What’s New at the Canadian International Trade Tribunal?

A Strategy for Injury Determination

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Outline

What is the CITT?WTO & Canadian frameworks for injury

determinationPast CITT strategiesCurrent CITT strategyWhat’s next?

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Canada has a long history with trade remedies

World’s first anti-dumping legislation in 1904

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What is the CITT?

Created January 1, 1989An independent, quasi-judicial, decision-making

bodyCanada has a bifurcated system

CITT does injury investigations

CITT also does safeguards, general economic studies, procurement and appeals

7 Members, 100 staff

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WTO Framework

Anti-dumping Agreement3.1 – objective examination of volumes, effect

on prices, impact on domestic producers

3.2 – significant increase in volumes?

– significant price undercutting?

3.5 – dumped imports are causing injury through the effects of dumping

– non-attribution

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Canadian Framework

Special Import Measures Act (SIMA)

CITT to inquire as to whether the dumping of the subject goods has caused injury

Injury = material injury to the domestic industry

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SIMA Regulations

CITT must consider 3 factors

1. Volume of dumped goods Significant increase?

2. Effects on Prices Significant undercutting, depressing, suppression?

3. Impact on the domestic industry Actual/potential decline in output, sales, market share,

profits, productivity, ROI or the utilization of capacity

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SIMA Regulations (con’t)

CITT must determinewhether a causal relationship exists between the

dumping … of the goods and the injury (Causation)

whether any factors other than the dumping … of the goods has caused injury(Non-attribution)

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The challenge for authorities

Attribution of injury Dumping is almost

never the only factor

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Two Schools of Thought

Total EffectsOverall extent of injury

caused by all factors is material

There is a causal link between the dumping and the material injury.

Dumping EffectsInjury caused directly by

the dumping is severe enough on its own to material

Dumping does not have to be the most important, major or principal cause of the total material injury

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CITT Strategies

Reasons for Decision 1989-91 Mostly total effects

Injury First 1992-99 Total effects

Dumping In and Of Itself 2000-2003 Dumping effects

Sequential Analysis 2003 to Present Dumping effects

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Reasons for Decision Strategy

No fixed structureNarrativeMateriality, causation,other factors togetherOften assessed total injury first

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Injury First Strategy

1st question – did the industry experience material injury?

2nd question – was there a causal link with the dumping?

Material injury had 2 meanings: total injury and injury from dumping

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Dumping In and Of Itself Strategy

Statistical summary – no conclusion on material injury

Relate observed trends to dumpingDetermine if negative effects of dumping

are material on their ownPresentation varied case to case

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Sequential Analysis Strategy

Mirrors SIMA Assess 3 injury factors

VolumeEffects on pricesImpact on domestic industry

Causation conclusionDid the dumping cause material injury?

Non-attributionRole of other factors?

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Volume of Dumped Goods

Significant increase? Displace domestic production?Gain market share?Outcomes:

Laminate Flooring NQ-2004-006 Increase in dumped goods √ Negative volume impacts√

Certain Steel Fuel Tanks NQ-2004-002 Increase in dumped goods √ Few negative volume impacts √

Unprocessed Grain Corn NQ-2005-001No increase in dumped goods

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Effects on Prices

Significant price undercutting, suppression, depression? Outcomes:

Certain Stainless Steel Wire NQ-2004-001Dumped prices fall √ Domestic prices increase √

→ Price suppressionCertain Fasteners (Carbon Steel Screws) NQ-2004-005

Dumped prices fall √ Domestic prices flat √ → Price erosion

Certain Fasteners (Carbon Steel Nuts and Bolts) NQ-2004-005Dumped prices rise √ Domestic prices fall √

→ No negative impact

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Impact, Causation and Other Factors

Trends in domestic industry?Impact of dumped goods?Causation

Did the dumping cause material injury?

Other factors

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Impact, Causation and Other Factors (con’t)

Positive Injury Determinations: Certain Stainless Steel Wire NQ-2004-001

Negative outcomes for domestic industry√ Dumping caused material injuryOther factors also had impact

Laminate Flooring NQ-2004-006 Negative outcomes for domestic industry√

Injury is materialCausal linkThe material injury caused by the dumping is materialOther factors also had impact

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Impact, Causation and Other Factors (con’t)

Negative Injury Determinations Certain Steel Fuel Tanks NQ-2004-002

Negative outcomes for the domestic industry √

Dumping did not cause material injury Injury attributable to other factors

Certain Fasteners (Carbon Steel Nuts and Bolts) NQ-2004-005Negative outcomes for the domestic industry √ Injury is material Injury can’t be attributed to dumped goodsOther factors

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Lessons Learned:Sequential analysis

Explicitly incorporates the key components of Canada trade remedies legislation

Provides framework for investigative work throughout case

Consistent format for decisions Eventually! See Unprocessed Grain Corn NQ-2005-001

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What is Next at the CITT?

No new strategies? Unlikely!