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Finance committee  It depends on what the demand is in their domestic market, for one thing. I think part of the overcapacity that we're seeing in the steel sector is because there's an overshooting of investment in steel production compared with global demand. That is part of it; you're just trying to unload it in whatever form you can to whatever market you can.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  Countries may have different strategic reasons for doing that. If they want to increase their global market share in a particular product category, that might be a reason, but I think you'd have to speak with individual governments as to the calculus they're making on that.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  We have proceeded in this way in the past, by including in our legislation the two-year period prescribed by the WTO rules. I think the intention is to confirm the temporary nature of that change. A two-year period is long enough to analyze the situation and decide whether it is necessary to impose safeguards.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  That is a larger question. Dumping is the behaviour of individual companies, so I think we need to distinguish between dumping and subsidization. I think on the subsidization side, where a government is providing assistance to a company, the company itself is not necessarily losing money on that.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  There were seven steel product categories on which provisional safeguards were imposed in October. Then the CITT ruled on those. Two of those categories now have final safeguards applied, and there are five that do not have safeguards applied.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  On the surge, you're right. If it's a one-month thing, that would likely not trigger the government to impose provisional measures or the CITT to conclude that this is a surge according to the definition required by the WTO rules. They do look at a longer period. Certainly, in determining whether provisional safeguards would be warranted, we would look at patterns during a particular period to see whether they constituted a surge and action needed to be taken.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  Yes, it's an order in council.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  The E.U. does have steel safeguards in place for a number of product categories. Those have been in place as final measures since January of this year. The United States does not have a safeguard in place, but as we know, the section 232 tariffs that were imposed on steel and aluminum have a very similar effect.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  On the second question, we've certainly been in touch not just with the steel producers but also with some of the smaller players you were talking about that might import steel for various purposes in using it in Canada. Certainly, with the way that safeguards were imposed on a provisional basis last time, and in looking at how the final safeguards are structured, it does allow for a certain amount of surtax-free trade to occur, reflecting historical levels.

June 11th, 2019Committee meeting

Michèle Govier

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  Yes. I think Patrick referred earlier to 77 measures being in place, with anti-dumping and countervail cases against a number of different countries related to steel products.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  Some of them go back quite a long time. Measures are generally imposed for five years, but they can be extended if it's found to be warranted and if it's likely that the dumping and subsidization that are causing injury are likely to continue. For some products, I think it goes back even 10 or 15 years.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  Absolutely. I think for virtually all products, China is one of the countries that are subject to those measures.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  As part of the CITT's process, I can speak to it a bit at a distance, because I'm obviously not involved in that process. Typically they would look at data over a three-year period and look for trends over that period, as well as looking at a more.... In the last finding, they did look at the first half of 2018 and compared it with the first half of 2017 to identify whether there were patterns that showed what looked like a significant increase.

June 11th, 2019Committee meeting

Michèle Govier

Finance committee  Certainly within the CITT process, they're well positioned to gather all of the information they have and, for the government's part, we have import permits for steel. We do have reasonably good data on steel, which is looked at on a regular basis.

June 11th, 2019Committee meeting

Michèle Govier