Trade Clippings December 2021

  • January 14, 2022

Dear Members of the CBA International Law Section, here are the international trade and investment articles and publications of interest for the month of December 2021. This month’s edition has been prepared by Ashley Taborda. Ashley is an associate in McCarthy Tétrault LLP’s International Trade & Investment Law group.


Canada’s dairy trade conduct violates USMCA pact, first panel rules, Globe and Mail (January 4, 2022)

In a December 2021 decision, a USMCA panel agreed with the United States that Canada’s practice of reserving preferential access or tariff-rate quotas for the use of dairy processors was a violation of the United States-Mexico-Canada Agreement (“USMCA”). The full decision can be accessed at and Canada’s news release in respect of the decision can be accessed here.

Canada to join Mexico in complaint over U.S. car-origin rules, Reuters (December 23, 2021)

According to Reuters, Canada plans to formally join Mexico in calling for an arbitration panel to resolve a dispute with the U.S. over how to interpret rules governing the origin of vehicle parts.

Biden signs bill banning goods from China’s Xinjiang over forced labour, Reuters (December 23, 2021)

On December 23, 2021, U.S. President Joe Biden signed into law the "Uyghur Forced Labor Prevention Act", which bans imports from China’s Xinjiang region over concerns of forced labour. This measure creates a "rebuttable presumption" that all goods from Xinjiang, where the Chinese government has set up a vast network of detention camps for Uyghurs and other Muslim groups, were made with forced labour. Similar legislation (Bill S-204, An Act to amend the Customs Tariff (goods from Xinjiang)) is currently being considered by the Canadian Senate; however, this legislation, if implemented, would bar the importation of all goods manufactured or produced wholly or in part in the Xinjiang Uyghur Autonomous Region of the People’s Republic of China, without any rebuttable presumption or similar measure.

Joe Manchin Kills the Build Back Better Bill, The New Yorker (December 19, 2021)

U.S. Senator Joe Manchin announced that he would not vote for President Joe Biden’s “Build Better Back” plan, which is said to have killed the bill for the time being. This is relevant for Canada, as this means the bill’s controversial electric vehicle tax credits are currently a non-issue. For background, on December 10, 2021, Canada’s Minister of Finance, Christia Freeland, and Minister of International Trade, Mary Ng, co-wrote a letter to U.S. senators expressing Canada’s “deep” concern that certain provisions of these electric vehicle tax credits would violate the United States’ obligations under the USMCA. Canada promised to retaliate by launching a dispute settlement process under the USMCA if this proposed U.S. legislation discriminated against Canada. A copy of the letter is available for subscribers on PoliticoPro.

Press Releases & Governmental Notices

Minister Ng announces Canada’s challenges to U.S. softwood lumber duties under Canada-United States-Mexico Agreement, Global Affairs Canada (December 21, 2021)

International Trade Minister Mary Ng issued a statement regarding the United States’ duties on Canadian softwood lumber, indicating that Canada had filed notices that it would be challenging the final results of the U.S. Department of Commerce’s second administrative reviews of the United States’ anti-dumping and countervailing duty orders on softwood lumber from Canada under Chapter 10 of the USMCA.

Gypsum Board: Notice of Expiry Review of Finding, Canadian International Trade Tribunal (December 13, 2021)

The Canadian International Trade Tribunal issued notice indicating that it will initiate an expiry review of the findings made in inquiry NQ‑2016‑002, concerning the dumping of gypsum board, sheet, or panel inquiry NQ‑2016‑002, concerning the dumping of gypsum board, sheet, or panel.

Canada imposes additional sanctions on entities affiliated with Myanmar military regime, Global Affairs Canada (December 10, 2021)

In coordination with the United States and United Kingdom, Canada announced additional sanctions against 4 entities under the Special Economic Measures (Burma) Regulations in response to the Myanmar military’s ongoing repression of the people of Myanmar and the escalating violence, eroding human rights situation and worsening humanitarian crisis in the country, as well as the regime’s refusal to take concrete action to restore democracy.

Minister Joly announces additional sanctions on Belarusian individuals and entities in response to ongoing and systematic human rights violations, Global Affairs Canada (December 2, 2021)

In coordination with the United States, the United Kingdom, and the European Union, Canada announced new sanctions on 24 individuals and 7 entities under the Special Economic Measures Act in response to the Belarusian regime’s ongoing and systematic human rights violations.

Opinions & Editorials

Trade update: Canada-UK trade talks enter new phase, Fasken (December 15, 2021)

Canada and the UK will be formally commencing the negotiation on a comprehensive bilateral free trade agreement in April 2022. In the Canada-United Kingdom Trade Continuity Agreement, Canada and the UK agreed to commence negotiations on a new bilateral free trade agreement by April 1, 2022 and to conclude such negotiations by April 1, 2024.

Migrant crisis triggers new round of sanctions against Belarus, McCarthy Tétrault LLP (December 7, 2021)

Canada coordinated the application of its sanctions against Belarus with the European Union, United States, and the United Kingdom. Nevertheless, the sanctions measures, including persons listed, as well as the spelling of their names, vary from country to country. Given the significant discrepancies in the sanctions regimes of Canada and its allies even when sanctions measures are apparently coordinated, it is crucial for firms to conduct their screening against the sanctions lists of each country that has jurisdiction over their transactions and other activities. Compliance with only US and/or EU sanctions measures does not protect against exposure to Canadian sanctions risk.

The Trade Environment: Evolving Context and Canadian Priorities, Bennett Jones (December 8, 2021)

Canada is currently facing a number of major trade challenges, many of which pose specific threats or opportunities that could seriously impact Canadian trade and prosperity. The biggest challenge is the apparent lack of interest in the administration of President Biden in Canada and how certain American actions threaten to damage Canadian important interests and undermine the Canada-U.S. relationship. Part of the Canadian response should be to engage in advocacy efforts in the United States. The Government should also be engaging in senior-level dialogue with public and private sector partners to assess the situation and determine how to proceed.

Hiking U.S. duties on Canadian softwood could damage our relationship with the U.S., Globe and Mail (December 5, 2021)

The Biden administration should roll back tariffs on softwood lumber from Canada. In addition to Canada and the U.S. being strong trade partners and allies, the duties are simply unjustified. For decades, U.S. lumber producers have accused Canadian producers of taking advantage of the United States by “dumping” low-priced lumber. Canadian lumber producers, however, have been cleared of this charge every time by international trade arbiters. These duties benefit only American lumber producers, who seek to protect their market share, while acting as a tax on American homes, driving up costs for builders, and exacerbating price volatility.

Canada Enters Into Free Trade Negotiations with the Association of Southeast Asian Nations, McMillan LLP (November 30, 2021)

On November 16, 2021, Canada announced that it will proceed with negotiations with the Association of Southeast Asian Nations (ASEAN) on a free trade agreement. Among other things, this article discusses the potential advantages for Canada associated with such an agreement, as well as anticipated priority and contentious subject areas for the negotiations.