Safeguards

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Safeguards

Safeguards are an extreme reaction to a surge in imports that presents a serious threat to the domestic industry.  Unlike anti-dumping or countervailing actions, safeguards are not a response to anything that the exporter or exporting country did.  It is simply a response to the surge and the size of the duty is simply enough to reduce the import volumes.

Effective period

Safeguards are typically not put in place for more than 3 years and need to be reduced for each year that it is in place, so that at the end of the third year, the safeguard duty has been removed.

Timing

It typically takes around 2 months for a preliminary decision to be implemented.

A final decision is usually implemented within 12 months of initiation, but under no circumstances may exceed 18 months.  If an investigation exceeds 18 months, then the matter will automatically terminate.

Application process

1) Industry standing

Before an application can be made to ITAC, the applicants need to represent more than 50% of the domestic industry, by sales volume.  Technically, the applicants only need to represent more than 25% of domestic production, but practically a matter will not be initiated if less than 50% of the industry makes the application.

2) Make the application to ITAC

It is important to submit current and relevant information.  The information should not be older than 6 months at time of initiation.

3) ITAC assessment of the information

ITAC will check all of the information submitted to determine if your application has merit.

4) ITAC verification

Once your application has been accepted as reasonable, it will be verified (audited) by a team of investigators from ITAC.  This verification will include a factory visit and a fairly detailed review of the financial and business information supporting the application.  If verification fails, the matter will not proceed.

5) Initiate and investigate.

If ITAC decides to proceed with the investigation, the matter will be initiated.  Initiation means that the investigation has commenced and interested parties will have 21 days to respond (with a 2 week extension usually granted).  Any interested parties who do not respond in time will not have their information considered for either the preliminary or final decision.

6) Interested party verifications.

All interested parties (usually only importers) normally takes 1 day.  ITAC will usually be onsite for the full duration of the verification.

7) Preliminary decision.

A preliminary decision will normally be taken within 2 months of initiation of a matter.  At this point duties will be imposed but the specific method of calculation will be unique for each investigation.

8) Final decision.

Once the investigation is complete, a decision will be implemented.  That decision will remain in place for 3 years.

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