Extend CETA trade rules to the United Kingdom

Summary#

The Order Amending the Import Control List and the Export Control List updates Canada’s trade control lists so the United Kingdom can keep using the same tariff and quota rules that applied under CETA. It was published in the Canada Gazette on April 14, 2021 and registered on March 29, 2021; it takes effect when the relevant section of the Canada – United Kingdom Trade Continuity Agreement Implementation Act comes into force (see “Why it matters” for the timing note).

What it does#

• Adds the United Kingdom as an eligible country for certain textile and apparel origin quotas on the Import Control List so those goods can continue to enter Canada at preferential tariff rates.
• Keeps some beef and veal products and certain milk protein substances excluded from import controls so they do not require import permits.
• Keeps controls on certain vehicles destined for the U.K. on the Export Control List so the government can issue export permits and manage origin quotas.
• Updates the rules that tell exporters what tariff references to use when they apply for export permits (changes to the Export Permits Regulations (Non-strategic Products)).

Who's affected#

• Importers and exporters of textiles and apparel that fall under origin quotas.
• Exporters of vehicles that were export-controlled under CETA and who send them to the U.K.
• Businesses dealing in certain beef and veal products and high-protein milk substances (they will not need new import permits because of these changes).
• Small businesses that trade with the U.K. and rely on preferential tariff access.
• Global Affairs Canada and other trade administration bodies that issue permits and monitor quotas.

Why it matters#

• The change keeps trade between Canada and the U.K. close to what it was under CETA after the U.K. left the EU (the U.K. left the EU single market on January 1, 2020). That reduces sudden tariff surprises or paperwork for businesses that trade with the U.K.
• For textile and apparel, it preserves negotiated quota limits and monitoring so imports at preferential rates don’t exceed agreed amounts. For vehicles, export permits help ensure Canadian exporters can secure preferential treatment when their goods arrive in the U.K.
• The Order’s legal effect begins when the relevant part of the Canada – United Kingdom Trade Continuity Agreement Implementation Act comes into force; if the Order is registered after that day it comes into force on the registration day. The underlying trade continuity deal was signed on December 9, 2020 and replicates CETA provisions that had been provisionally applied since September 21, 2017.