Special investigation measeures act SIMA

This is the based on special investiagation measeues act Canada. SIMA

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          Since international trade has become the main part of global business, there are a lot of advantages for trading industry and nations; however, some cases like dumping that cannot easily be controlled and can cause injuries in domestic markets. Dumping means that selling goods in another country at price lower than the domestic market of exporter. Most of the nations have their rules to control the price in order to protect the domestic manufactures. Special Import Measures Act (SIMA) is the regulation of the dumping in Canada, and Anti-dumping duties under SIMA will be applied in Canada when the dumping situation is occurred. The following is a dumping case that shows how the process of defining it and charging the duties from the government.


Blue Mountain Corp (905773214RM0001) in Canada ordered 5000 pairs of rubber boots from Ski World Company in China that were the unit price CAD $30.00 at CIF Montreal net 50 days and the total price was 150,000.00 CAD under MFN. The shipment shipped by Oriental Overseas International Limited Ltd from Hong Kong, China to Main Longroom, Canada(395) . The date of direct shipment to Canada was Aug 15, 2008 and the cargo control number is 9082-4567895. One carton contained 10 pairs of the boots and the total shipment was 5 containers. Net weight of the shipments was 5000kg and gross weight was 7500kg.

Blue Mountain Corp were selling the boots at $75.00 CAD per pairs to Canadian customer, they were very successful because their price was lower than competitions price which was $120.00 CAD in Canada. After 6 months, the competitions found out that their sales were decreased because of the price, so they complained to Shoe manufacture Association in Canada. The association decided to complain to the government of the injury of their industry from the lower price products.


The Shoe Manufacturers’ Association of Canada (SMAC) of Baie d’Urfé, Quebec complained about that some importers were bringing certain waterproof rubber footwear as dumping from China and Vietnam into Canada, and that were causing injury in domestic market. CBSA confirmed the complaint’s documentations under subsection 32(1) of the Special Import Measures Act (SIMA) on January 29, 2009. In order to assist the claim, SMAC as a complainant collected the evidence of the injury from the imported products from China and Vietnam, and provided to CBSA. Moreover, they attached a specific indication which explained that the Canadian manufactured goods were injured by imported goods, or they were potentially injured.

In order to assist the claim, SMAC as a complainant collected the evidence of the injury from the imported products from China and Vietnam, and provided to CBSA. Moreover, they attached a specific indication which explained that the Canadian manufactured goods were injured by imported goods, or they were potentially injured. On February 27, 2009, the compliant had have been approved by CBSA in accordance with subsection 31(1) of SIMA, and CBSA started to investigate the possible dumping waterproof rubber/plastic footwear from China and Vietnam.

SIMA Investigation—-Complainant by Canadian industry

The Shoe Manufacturer’s Association of Canada (SMAC) submitted the complaint on behalf of the six producers.

The Shoe Manufacturers’ Association of Canada
90 Morgan Road
Suite 203
Baie d’Urfé, QC
H9X 3A8

The Canadian industry for footwear is composed of six producers who produce waterproof footwear of plastic and/or rubber. Four of the six producers provided letters of support for the complaint. The one of six producers is:

Air Boss Defence
881 rue Landry
Acton Vale, QC
J0H 1A0     ……..

Based on information provided in the complaint, CBSA gathered other information as well. Thus, under the subsection 31(2) of SIMA, the complaint has met the standing requirements.

Preliminary Determination—-Evidence of dumping by CBSA

Based on the total volume of imports which was reasonable form China and Vietnam, and statistics for imports from other countries was obtained from customs data for heading 6401, CBSA determined that there were significant importations. For the reason of protecting the Canadian domestic industry, the CBSA avoided to provide the detailed information about the domestic production data of the two largest Canadian producers. However, the following table provided by CBSA still can show the estimated percentage market shares of waterproof footwear in Canada using only the goods imported under the relevant classification numbers of heading 6401.



Imports –
Subject Goods



Jan.1 to
June 30 2007

Jan.1 to
June 30 2008


% of imports


% of imports


% of imports


% of imports

China 493,144 42.4% 765,026 70.7% 197,664 61.8% 429,516 64.8%
Vietnam 11,713 1.0% 54,040 5.0% 18,436 5.8% 33,308 5.0%
Imports – Other Countries 657,178 56.6% 262,693 24.3% 103,718 32.4% 200,437 30.2%
Total Imports 1,162,035 100.00% 1,081,759 100.00% 319,818 100.00% 663,261 100.00%


From the research report, it determined that the export price of goods sold to importers in Canada is lesser of the exporter’s selling price, and the importer’s purchase price is lesser than all the expense resulting from the exportation of the goods.

The complainant alleges that the subject goods have been injuriously dumped into Canada. There is dumping exist as export price of the goods sold to an importer in Canada lower than the normal value of the goods; in another word, the goods are sold to importers in Canada at prices lower than the full cost of the goods. Normal values are generally based on the domestic selling prices of the goods in the country of export (section 15 of SIMA), or on the total cost of the goods including producing and selling the goods plus a reasonable amount of profit (section 19 of SIMA).


Preliminary Determination—-Material injury by CITT

CITT provided the approximated margins of dumping and imports data summary of the period between January 1, 2008 and June 30, 2009 which is shown below.


January 1, 2008 to June 30, 2008

Country Percentage
of Total
Estimated Dumped Goods
as % of Country Total
Estimated Dumped Goods
as % of Total Imports
Margin of Dumping as %
of Export Price
China 64.8% 100.0% 64.8% 45.0%
Vietnam 5.0% 100.0% 5.0% 31.2%


SIMA determined that the imported goods caused physical injury in domestic industry. The CBSA assigned that the imported waterproof rubber footwear was alike goods to Canadian manufactured product. CBSA’s report was concentrated on how the dumped goods from China and Vietnam were affecting on Canadian market.

While trade with China and Vietnam had increasing in 2006 to 2008, SMAC indicated that it decreasing their industry market shares in Canada. SMAC disclosed account information from four main clients in Canada included the proof of the declining sales due to the dumped Chinese and Vietnamese products in 2008 compare to 2007 to assist their claim. In addition, SMAC directly pointed to the imported goods from China and Vietnam as the reason why they lost sales.


Based on the information provided in the complaint, other available information, and the CBSA’s internal data on imports, there is evidence that waterproof rubber footwear originating in or exported from China and waterproof rubber and/or plastic footwear originating in or exported from Vietnam have been dumped, and there is a reasonable indication that such dumping has caused or is threatening to cause injury to the Canadian industry. As such, a dumping investigation was initiated on February 27, 2009.

Based on the information from the Canadian Trade Lawyers website, On March 24, 2010, the Canadian International Trade Tribunal announced that on December 6, 2010, the anti-dumping order against waterproof footwear and bottoms from China will expire.



Dumping occurs frequently in international trade for several reasons such as cancelation of shipments and bankrupt of importers. It could be a chance for importers to extend their market shares and increase the sales, but dumping is a threat for domestic industry. Therefore, most of nations have the regulations to prevent a monopoly and encourage manufactures in the country. Special Import Measures Act (SIMA) helps manufactures in Canada in order to compete with other importers.  As we learned the importance and roles of SIMA, we applied the theory from ITC411 class on this scenario. In addition, we acquired more details of the process, and how CBSA and CITT initiate the investigation and make a decision to collecting duties.


Works sited

Canada Border Services Agency. Anti-dumping and Countervailing Program.” Govt. of         Canada, 13 Mar.2009. Web. 3 April 2010


Canada Border Services Agency. “The CBSA starts investigation into the dumping of certain waterproof footwear.” Govt. of Canada, 4 Mar. 2009. Web. 4 April 2010


Cyndee Todgham Cherniak. “Canada’s Anti-dumping Order Against Waterproof  Footwear and Bottoms from China Will Expire in December 2010” Trade Lawyers Blog, Web 05 April. 2010.


Canadian International Trade Tribunal. “Dumping and Subsidizing” Gov. of Canada, 28 Apirl. 2009. Web 13 2009.



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