Part2: Module 2.3 Lesson 4: The Special Import Measures Act (SIMA)

Question 1

define dumping and subsidization;

Question 1

explain the purpose of SIMA;

Answer 1

to protect industries in Canada from injury by goods that have been dumped in Canada or goods that have been subsidized in their country of export, or both.

Question 2

describe the complaint process;

Question 3

define provisional, anti-dumping and countervailing duties.

Question 4

describe the Special Import Measures Act

Answer 4

three Parts and provides for the:
* investigation of complaints made by Canadian producers, that imported goods sold in Canada at a reduced cost cause injury to them; and
* assessment of additional costs (collection of provisional, anti-dumping, and countervailing duties) if injury is found.

https://laws-lois.justice.gc.ca/eng/acts/s-15/

Question 5

define injury under SIMA

Answer 5

reduced prices, lost sales, or lost market share for Canadian products, and decreased profits for the affected Canadian industry.

Question 6

Define ‘Dumped’ goods under SIMA

Answer 6

Dumping occurs when imported goods are sold to a business or person in Canada at prices lower than when they are sold in the country of export or when goods are sold into Canada at unprofitable prices (offset using ‘anti dumping’ duty)

Question 7

Define ‘Subsidized’ goods under SIMA

Answer 7

Subsidizing occurs when goods imported into Canada benefit from foreign government financial assistance. Subsidized goods are goods destined for export at prices lower than the prices at which the goods are sold in the domestic market of the exporter, the production of which has been subsidized by the government of the exporting country. (offset using ‘Countervailing’ duties)

Question 8

give some examples of subsidies by foreign governments on exported goods

Answer 8

financial incentives such as loans at preferential rates, grants, and tax incentives

Question 9

explain Provision Duty

Answer 9

applied to goods based on CBSA preliminary determination, while an investigation of dumping or subsidizing is underway

Question 10

True or False; after the investigation is over, it is found that injury did not occur, provisional duty, with interest, is returned to the importer.

Answer 10

True

Question 11

what is the ‘provisional period’ under SIMA

Answer 11

time between establishing that dumping and/or subsidizing has occurred and the determination of injury

Question 12

to whom does a Canadian Producer or industry launch a complaint of injury?

Answer 12

CBSA’s Trade and Anti-dumping Program Directorate.

Question 13

what are the conditions for being eligible to launch a complaint?

Answer 13

complaint represents at least 25% of Canadian production of the goods and the number of producers supporting the claim must be greater than the number of producers opposed.

Question 14

what must the complaint include?

Answer 14

elaborate and demonstrate the adverse effects experienced by the company or industry due to dumping or subsidizing of the foreign goods

Question 15

Ture or False; SIMA duties are applied as additional duty, an addition to the regular duties that may be applicable under the Customs Tariff schedule.

Answer 15

True

Question 16

what happens if SIMA rates are not applied to imported goods?

Answer 16

Failure to apply these SIMA duties to imported goods can lead to interest charges and in the worst case, monetary penalties.

Question 17

What are “subject goods” under SIMA?

Answer 17

When the SIMA duties are applicable, the goods are referred to as “subject goods”. (examples are steel pipes, whole potatoes, fasteners, sugar, and gypsum board)

Question 18

True or False; It is not just the goods that warrant the application of the SIMA duties, it is goods from a specific country or countries of export found to be dumped and/or subsidized.

Answer 18

True

Question 19

Lesson 4 Summary

Answer 19

Key points covered in this lesson are:

• the Special Import Measures Act is a protection for Canadian producers from dumped and subsidized goods that cause injury to the Canadian production of like goods;
• dumping is the selling of goods in another country’s market at prices lower than the prices at which the goods are sold in the domestic market of the exporter;
• subsidized goods are goods destined for export at prices lower than the prices at which the goods are sold in the domestic market of the exporter, the production of which has been subsidized by the government of the exporting country;
• provisional duty is applied to goods while an investigation of dumping or subsidizing is underway; and
• anti-dumping and countervailing duties are applied when dumped or subsidized goods cause injury to a Canadian producer of like goods.