Canada Exploring New Export Control, Economic Security Measures

Canada is considering new measures to strengthen its export controls, tariffs and other trade-related enforcement powers as it analyzes whether it has tools powerful enough to protect against threats to its economic and national security.

The country said it’s seeking input from companies, trade groups, academia and others on “potentially strengthening measures to advance Canada’s economic security and supply chain resilience in the context of global economic and trade challenges,” including protectionist measures, nonmarket policies and coercion by other countries. The comments could lead to “potential enhancements” to Canada’s toolkit of trade controls, including new export restrictions on emerging and dual-use technologies, more effective antidumping and countervailing duties, new supply chain policies, export duties for products in certain critical industries and expanded investigative powers.

The country is accepting comments until Sept. 23. The announcement comes about a month after Canada launched a 30-day consultation period for whether it should impose additional duties or take other measures against Chinese electronic vehicle imports (see 2407030035).

One portion of Canada’s consultation asks for feedback to ensure the country’s export control regulations continue to “address risks to national security posed by exports of advanced dual-use technologies.” The country said it’s considering adding “critical or strategic items” to its Export Control List or Import Control List, and is thinking about whether “enhanced monitoring may be required.”

It’s also considering “amended or additional authorities” to place export duties or restrictions on “certain products in critical or strategic sectors in response to the trade actions of other countries or for Canada’s economic security (e.g. through amendments to the Special Economic Measures Act, or the Export Act).” This could include new legislation that would cover specific sectors, such as critical minerals. It’s seeking feedback on the “specific criteria” it should evaluate before imposing export duties or a list of products to focus on.

Canada is also considering “enhanced trade remedies authorities” for its anti-circumvention and enforcement efforts, which “could further protect against unfairly dumped or subsidized imports that harm Canadian industry.” It may also explore ways to suspend nontariff benefits under a free trade agreement “in response to trade actions that harm Canada.”

Other measures could help Canadian companies improve the standing of their supply chains. The country said it’s exploring restricting access to certain Canadian incentives or other trade and investment benefits in a way that will “strengthen Canada’s supply chains in relation to certain products, for instance in critical or strategic sectors, to limit the sourcing of these products from entities that pose risks related to Canada’s essential security interests.” Canada also may expand incentives to improve the “competitive standing” of certain Canadian sectors, including for critical mineral projects, or offer financing options to help companies manage “price volatility” or diversify their critical minerals supply chains.

Canada also wants feedback on whether the government needs more investigative powers, including “new forms of administrative or quasi-judicial investigations or reviews,” which “may be needed to achieve economic resilience objectives.”

The country said it’s looking for “specific suggestions” to improve its tools “used for addressing economic security vulnerabilities, such as economic coercion, shocks to essential supply chains, unfair trade practices that undermine Canada’s competitiveness on the global stage, and protectionist policies by other countries that restrict Canada’s access to international markets.” It also wants input about the types of situations in which Canada should use these tools, and whether it needs guardrails to “constrain overuse of a measure.”

One question asks for possible policy measures that will help Canada better compete in emerging technologies and critical minerals. The country is seeking potential “trade and investment policy approaches” for energy and clean technology, critical minerals, artificial intelligence, biotechnology, quantum computing, semiconductors and communications technologies.

It also asks for steps Canada can take to help companies manage supply chain risks, gain foreign market access, secure essential imports goods from foreign markets and more.

Mary Ng, Canada’s international trade minister, said “we are engaging with Canadians to ensure that our economy remains strong and secure in the face of policies and practices that can undermine our competitiveness and prosperity.”