On December 21, 2020, the Canada Border Services Agency (CBSA) initiated investigations concerning the alleged injurious dumping and subsidizing of certain upholstered domestic seating imported from China and Vietnam. The investigation has been commenced under the Special Import Measures Act (SIMA), which helps to protect Canadian industries from injury caused by the dumping and subsidizing of imported goods. The investigations were initiated further to a complaint filed by Palliser Furniture Ltd. (Winnipeg, Manitoba).

The subject goods are usually classified under the following tariff classification numbers: 9401.40.00.00; 9401.61.10.10; 9401.61.10.90; 9401.71.10.10; and 9401.71.10.90.

Appendix 1 to the notice of initiation of investigations provides the product definition and additional information on the subject goods. The product definition provides that the subject goods are any upholstered seating used for domestic purposes that originate in or are exported from China and Vietnam. This definition extends to include both stationary and “motion” seating. The phrase “for domestic purposes” is defined under Chapter 94 of the Schedule to the Canadian Customs Tariff and has been interpreted and applied in Tribunal jurisprudence (see e.g., Stylus Sofas, Appeal No. AP-2013-021).  It covers seating products that are intended and designed for use in residential settings. The product definition includes an explicit exclusion for seating products that are “clearly designed and marketed for non‑domestic (i.e. commercial) use, such as in offices, business reception areas, restaurants, studios and other non‑residential applications.”

Additional guidance addresses the different descriptive marketing terms that may be used by manufacturers and retailers to describe the subject goods, noting that these “descriptive words generally do not indicate any material differences in the nature of the goods or detract from the goods being subject goods.”

Further information regarding the investigations will be available in a Statement of Reasons that will be posted within 15 days on the CBSA’s website.

Tereposky & DeRose regularly provides advice on Canadian trade remedy and trade defence matters, including anti-dumping and countervailing investigations. Should you have any questions regarding this matter, we are at your disposal.