Interim Reviews (section 76.01)
Interim Review No. RD-2008-001
Friday, October 24, 2008
Friday, November 7, 2008
TABLE OF CONTENTS
IN THE MATTER OF an interim review, under paragraph
76.01(1)(b) of the Special Import Measures Act,
of the findings made by the Canadian International Trade Tribunal
on January 7, 2005, in Inquiry No. NQ-2004-005 concerning:
THE DUMPING OF CERTAIN
FASTENERS ORIGINATING IN OR EXPORTED FROM THE PEOPLE’S REPUBLIC OF
CHINA AND CHINESE TAIPEI AND THE SUBSIDIZING OF SUCH PRODUCTS
ORIGINATING IN OR EXPORTED FROM THE PEOPLE’S REPUBLIC OF
The Canadian International Trade Tribunal, under the provisions
of paragraph 76.01(1)(b) of the Special Import
Measures Act, has conducted an interim review of the
Pursuant to paragraph 76.01(5)(b) of the Special
Import Measures Act, the Canadian International Trade Tribunal
hereby makes no amendment to its findings.
Pasquale Michaele Saroli
Pasquale Michaele Saroli
The statement of reasons will be issued within 15 days.
Serge Fréchette, Presiding Member
Diane Vincent, Member
Pasquale Michaele Saroli, Member
Senior Research Officer:
Counsel for the Tribunal:
Senior Registrar Officer:
Leland Industries Inc.
Lawrence L. Herman
H. Paulin & Co. Limited
Honor Best Co., Ltd.
IJ Windows & Doors Ltd.
Mary C. Bozinovic
Please address all communications to:
Canadian International Trade Tribunal
Standard Life Centre
333 Laurier Avenue West
1. On April 15, 2008, the Tribunal received a request from IJ
Windows & Doors Ltd. (IJ) for an interim review under paragraph
76.01(1)(b) of the Special Import Measures
of the Tribunal’s findings in Certain
to exclude certain screws from the scope of
2. On April 16, 2008, the Tribunal requested that IJ provide
additional information, including any new facts or changes in
circumstances that had arisen since the findings that would warrant
an interim review, and a completed Product Exclusion Request Form
clarifying the products for which it was seeking an exclusion.
3. On May 1, 2008, the Tribunal received the requested
information from IJ, along with a Product Exclusion Request Form
seeking an exclusion for “sheet metal screws E-guard coated and
4. The Tribunal replied to IJ on June 5, 2008, and asked it to
provide further information regarding the products for which it was
seeking an exclusion, including, among other things, the
composition of the products and the country of origin, the importer
of the goods, documentation of attempts to procure the goods from a
domestic manufacturer, whether any Canadian manufacturers supported
the exclusion request, any new facts or changes in circumstances
that had arisen since the findings that would warrant an exclusion,
and the reason why an exclusion was not requested at the time of
the original inquiry.
5. IJ provided the requested information to the Tribunal on July
2, 2008. IJ clarified that the products for which it was seeking an
exclusion are “Philips, flat head, sheet metal screw[s], yellow
zinc plated c/w e-guard coating.” originating in Taiwan. IJ
indicated that it purchases these screws from Truth Hardware, of
Owatonna, Minnesota. In addition, IJ had previously indicated, in
its Product Exclusion Request Form, that the screws for which it
was seeking an exclusion were of the following sizes: 8x1, 7x3/4,
8x3/4, 10x1, 7x1/2, 8x9/16 and 10-24x9/16.
6. After reviewing the additional information received from IJ,
the Tribunal determined that the request for an interim review was
properly documented. On July 17, 2008, pursuant to subrule 70(2) of
the Canadian International Trade Tribunal
the Tribunal informed all parties to Inquiry
No. NQ-2004-005, which resulted in the findings, of its receipt of
the request for an interim review and gave those parties an
opportunity to make representations to the Tribunal.
7. The sole party to file a
response was Leland Industries Inc. (Leland), a Canadian producer
of like goods. Leland agreed to the exclusion requested by IJ,
limited to the specific E-Gard® screws listed in IJ’s request,
imported for use by IJ in the manufacture of its own products in
its Kamloops, British Columbia, facility and sourced from Truth
Hardware. Leland submitted that, should the Tribunal decide to
conduct an interim review, it would agree to an amendment of the
findings in accordance with the specified conditions.
8. IJ replied on August 18, 2008, indicating that it was fully
satisfied with the contents of the submission filed by Leland and
requesting that the Tribunal amend the findings in accordance with
the terms set out in Leland’s letter.
9. Upon receipt of submissions from IJ and Leland, the Tribunal
decided that an interim review of the findings was warranted and
issued a notice of commencement of interim review on August 28,
In accordance with paragraph 25(c) of the
Rules, the Tribunal decided to proceed with a hearing by
way of written submissions. Submissions already filed by parties
were placed on the record of the interim review. The Tribunal
requested that further submissions by interested parties respecting
the products for which an exclusion had been requested or their
descriptions be filed not later than September 18, 2008, with reply
submissions due on September 25, 2008.
10. As regards the scope of any exclusion order, the Tribunal
requested an indication from Leland as to whether it would support
a generic exclusion for the products for which an exclusion was
requested that does not make reference to the name of the user,
supplier or distributor and that does not refer to a specific end
use. If not, the Tribunal further requested that Leland provide
evidence that it currently produces or has the capability of
producing a substitutable product and to explain how the granting
of a generic exclusion would result in injury to the domestic
11. Finally, the Tribunal requested an indication from IJ and
Leland as to whether they would be opposed to the addition of the
following phrase to the definition of the products for which an
exclusion was requested: E-Gard®-painted screws “or an equivalent
12. On September 18, 2008, Leland submitted that, should the
Tribunal broaden the definition of the products for which an
exclusion was being requested, it would result in injury to the
domestic industry, as Leland produces a similar coated product that
would be substitutable for the fasteners imported by IJ. Leland
stated that its fasteners would be substitutable in all
applications where the fasteners were not required to match other
window hardware produced by Truth Hardware.
13. The Tribunal also received submissions from H. Paulin &
Co. Limited (Paulin) and Honor Best Co., Ltd. (Honor).
14. Paulin opposed the requested exclusion, stating that it
would be injurious to Canadian fastener and coating manufacturers,
would provide an advantage to one importer (Truth Hardware) and
would put other window and door manufacturers at a
15. Honor, a producer in Taiwan, submitted that it did not
oppose an exclusion for E-Gard®-coated screws, but did oppose an
exclusion if the screws were subsequently colour-coated.
16. IJ replied on September 29, 2008, stating that it was in
agreement with Leland’s submissions.
REASONS FOR DECISION
17. Subsection 76.01(1) of SIMA states that, at any
time after the making of an order or finding described in any of
sections 3 to 6, the Tribunal may, on its own initiative or at the
request of the Minister of Finance, the President of the Canada
Border Services Agency or any other person or government, conduct
an interim review of (a) the order or finding, or (b) any aspect of
the order or finding. Further, subsection 76.01(3) states that
the Tribunal shall not conduct an interim review at the request of
any person or government unless the person or government satisfies
the Tribunal that the review is warranted.
18. The Tribunal’s first step after receiving a request for an
interim review, therefore, is deciding whether the interim review
is warranted. This decision is usually reached after considering
whether there is a reasonable indication that sufficient new
relevant facts have arisen since the issuance of the existing
finding or order, or that there has been sufficient change in the
circumstances that led to the finding or order in question. An
interim review may also be warranted where there are sufficient
relevant facts that, although in existence during the previous
inquiry or review, were not put into evidence and were not
discoverable by the exercise of reasonable diligence at that
19. After reviewing IJ’s request and the subsequent information
that it provided to the Tribunal in support thereof, the Tribunal
was satisfied that the information provided a reasonable indication
that the initiation of an interim review was warranted.
20. After deciding that an interim review is warranted, the
Tribunal can then undertake the interim review to determine if the
original finding or order should be amended.
21. The basis for the application of anti-dumping and/or
countervailing duties on goods is established in the original
finding or order. Therefore, the issue to be considered in an
interim review is whether, in light of new facts or changed
circumstances, there remains a continuing justification for the
application of such duties to the particular goods for which an
exclusion from the scope of the Tribunal’s finding or order is
22. In this interim review, IJ is asking the Tribunal to amend
its original findings to grant an exclusion for specific
E-Gard®-coated screws listed in IJ’s request (described above),
imported for use by IJ in the manufacture of its own products in
its Kamloops facility and sourced from Truth Hardware. The exact
wording of this exclusion request has evolved throughout the
interim review and was settled subsequent to an agreement between
IJ and Leland.
23. When a party requests a product exclusion, it is required to
indicate whether or not the domestic industry supports the
exclusion. In this case, Leland and IJ have reached an agreement on
the scope of the product exclusion that would be acceptable to both
parties. The Tribunal notes however that an agreement between the
domestic industry and a party requesting an exclusion does not
compel the Tribunal to grant the agreed-upon exclusion.
24. In considering requests for product exclusion in the context
of an interim review, the Tribunal follows an approach similar to
that used during inquiries. This approach was summarized in
Certain Stainless Steel Wire.5
approach is that the Tribunal will grant product exclusions only
when it is of the view that such exclusions will not cause injury
to the domestic industry. In this context, the Tribunal considers
such factors as whether there is any domestic production of
identical, substitutable or competing goods, whether the domestic
industry is an “active supplier” of the product, or whether it
normally produces the product or has the capability of producing
25. The present case involves a request for exclusion of
products involving intellectual property protection. The Tribunal
notes that, in Certain Fasteners (remand)6
involved a patent, it indicated that the fact that a product is
patented does not mean that the Tribunal will automatically grant
an exclusion. Even though a patented product may have certain
features or physical attributes that make it distinct under patent
law, a domestically manufactured product may have the same end
uses, fulfil most of the same customer needs and compete in the
marketplace with the patented product. Therefore, even if a request
for a product exclusion concerns a patented product, the Tribunal
must still determine whether the circumstances of the case are such
that granting an exclusion could cause or threaten to cause injury
to the domestic industry. The Tribunal is of the view that this
reasoning is equally applicable to products that benefit from
26. In considering product exclusions, the Tribunal is also
sensitive to the need to avoid the creation of trade distortion or
unfair competitive advantages for one or more parties. In that
regard, the Tribunal stated the following in Certain Flat
Hot-Rolled Carbon and Alloy Steel Sheet Products:
In determining how to define the product to be excluded, the
Tribunal gave careful consideration to the views expressed by the
parties. However, the Tribunal is of the view that any exclusion to
a finding, whether provided at the time of the original finding or,
subsequently, upon the completion of a review, should normally be
defined as generically as possible to avoid potential trade
distortions and unfair competitive advantages. Accordingly, the
Tribunal avoided reference to restrictions relating to producers
and end-users. The Tribunal has decided to leave the “Solbor”
trademark in the definition of the exclusion as well as end uses.
However, it has described the specifications of the trademarked
product in as much detail as possible and has also added the term
“or equivalent” in order to allow any other potential suppliers to
benefit from this exclusion in offering this product in
27. In the present case, the Tribunal is of the view that the
specific exclusion agreed upon by Leland and IJ would potentially
restrict competition between IJ and other end users of the E-Gard®
fasteners in question, as well as between IJ and competitors using
substituable fasteners, with IJ being exempt from anti-dumping
duties, while these other users would be required to pay same on
the importation of the subject goods.
28. The Tribunal further considers that to grant a generic
product exclusion for the requested fasteners and substitutable
products could result in injurious effects on the domestic
industry. To this effect, Leland submitted evidence that it
produces directly substitutable products.
29. In an affidavit, Mr. Byron Nelson, President of Leland,
submitted that Leland offers a type of coated screw that is very
similar to the kind of screw that IJ uses, with the only difference
being the E-Gard® coating, which Leland does not have a license to
use. He explained that there are many kinds of platings and
coatings that closely resemble or are substitutable for E-Gard®
30. Mr. Nelson submitted that a generic product exclusion for
flat head Philips zinc-coated and plated metal screws in the
dimensions referred to in IJ’s request could lead to a flood of
imports through existing Canadian importers, brokers and
distribution channels. He further submitted that an exclusion
limited to E-Gard®-coated screws in the dimensions requested would
still allow imports that would compete directly with Leland’ s own
products and result in lost sales.9
31. The Tribunal notes that Leland agreed to IJ’s request in
part because of the low volumes of imports by IJ.10
submitted that Truth Hardware has other customers that would, in
principle, be entitled to the same exclusion and added that this
would put its own customers at a competitive disadvantage if an
exclusion were granted for IJ.11
The Tribunal is of the
view that it would be unfair to grant an exclusion that would give
IJ an advantage over other importers of the goods and that such an
exclusion could open the door to a multitude of requests from other
importers of E-Gard®-coated products. In the circumstances, the
Tribunal is of the view that it is not appropriate to grant an
exclusion for a specific importer, even where the domestic industry
agrees to such a request.
32. IJ argued that it was rendered less competitive in
comparison with its U.S. competitors as a result of having to pay
anti-dumping duties on the subject goods. While it might be an
unfortunate consequence of such measures for this importer, it is
not, in and of itself, a sufficient basis for an exclusion.
33. For the foregoing reasons, pursuant to paragraph
76.01(5)(b) of SIMA, the Tribunal hereby makes no
amendment to its findings.
. R.S.C. 1985, c. S-15 [SIMA].
. (7 January 2005) (CITT).
. S.O.R./91-499 [Rules].
. C. Gaz. 2008.I.2569.
. (30 July 2004), NQ-2004-001 (CITT) at
. (26 September 2006), NQ-2004-005R (CITT)
at para. 17.
. (17 January 2003), RD-2002-003 (CITT) at
. Tribunal Exhibit RD-2008-001-18.3,
Administrative Record, Vol. 1 at 189.
. Ibid. at 190-91.
. Ibid. at 190.
. Tribunal Exhibit RD-2008-001-18.1,
Administrative Record, Vol. 1 at 171.