Trade remedies: employment terms and circumvention

Summary#

These final regulations (SOR/2022-160) change how Canada’s trade-remedy system looks at the effects of imports. Published in the Canada Gazette on July 6, 2022, they came into force on registration day (June 24, 2022) and require decision-makers to explicitly consider workers’ terms and conditions of employment and give the border agency more flexibility to investigate circumvention of duties.

What it does#

• Adds “terms and conditions of employment” (for example, wages, hours worked, pensions, benefits, training and safety) as factors to be considered when the Canadian International Trade Tribunal (CITT) and investigators assess injury or threat of injury in:
  • anti‑dumping and countervailing duty investigations,
  • safeguard inquiries,
  • expiry reviews of existing trade remedy measures.
• Removes the requirement that the imposition of duties be the “principal cause” of a change in trade patterns for anti‑circumvention cases. This gives the Canada Border Services Agency (CBSA) more discretion to find circumvention even when other factors also played a role.
• Clarifies that, in anti‑circumvention work, the CBSA can consider economic or commercial factors unrelated to the imposition of duties.
• Updates the Canadian International Trade Tribunal Regulations so the Tribunal must evaluate a broad set of economic indicators that include effects on employment and the terms and conditions of employment.

Who's affected#

• Workers in industries that face competition from imported goods — including unionized and non‑unionized employees — who may see their working conditions weighed more explicitly in investigations.
• Canadian producers and manufacturers seeking relief from unfairly traded imports; they may get stronger consideration for measures that protect jobs.
• Importers, exporters and traders who could face more or different investigations, including anti‑circumvention inquiries.
• Canada Border Services Agency and Canadian International Trade Tribunal, which will apply the new factors in their work.
• Trade lawyers, consultants and industry groups involved in trade remedy cases.

If it’s unclear who will be affected in a specific case, the regulations give the CBSA and the CITT discretion to decide based on the facts.

Why it matters#

• It makes worker impacts—like lost hours, reduced wages, cuts to pensions or safety and training—an explicit part of the decision about whether imports are harming a Canadian industry. That can change outcomes in favour of domestic firms and their employees.
• It lowers the legal hurdle for anti‑circumvention actions, so the CBSA may more readily investigate and block tactics meant to avoid duties. That could affect how companies structure imports.
• For consumers and businesses that buy imported goods, the changes could influence prices or availability if duties or enforcement rise. Regulators say they do not expect major new costs from these rules, and the changes implement a commitment from Budget 2022.