Textiles
- Document symbol
- G/LIC/N/3/CAN/22
- Original language
- English
- Published on
- 01/11/2023
Outline of Systems
Q1. Give a brief description of each licensing system as a whole and, with respect to each, reply to the following questions as relevant, placing all of the material with respect to a given system in sequence together, and using cross references as appropriate when elements which have already been described are also present in another system.
Textiles are on the Import Control List, established pursuant to the Export and Import Permits Act. Quantitative restraints (i.e., quotas) on imports of textiles were eliminated for goods shipped after 31 December 2004 in accordance with the WTO Agreement on Textiles and Clothing (ATC). Individual import licensing or open general licensing requirements for such goods were eliminated on 1 April 2005. An import licensing system remains in place for textiles shipped in connection with Tariff Preference Level (TPL) provisions established pursuant to the Canada-United States-Mexico, Canada-Chile, Canada-Costa Rica, and Canada-Honduras Free Trade Agreements and for origin quotas established pursuant to the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) and the Canada-UK Trade Continuity Agreement (Canada-UK TCA).
Purposes and Coverage of Licensing
Q2. Identify each licensing system maintained and state what products, appropriately grouped, are covered.
Textile products on the Import Control List subject to individual import permits for TPL are as follows: cotton or man-made fibre fabrics and made-up goods (CUSMA, Chile, Costa Rica); wool fabrics and made-up goods (Chile and Costa Rica); cotton or man-made fibre spun yarns (CUSMA, Chile, Costa Rica), and fabrics and made-up goods (Honduras). Origin quotas established under the CETA and the Canada-UK TCA include certain woven fabrics, sewing thread, twine, carpets, plastic-coated/covered/laminated fabrics, linoleum, transmission or conveyor belts or belting, technical textile products, bed linens, toilet and kitchen linens, floor-cloths, polishing-cloths, dish-cloths and dusters.
Q3. The system applies to goods originating in and coming from which countries?
The system applies to imports from the United States, Mexico, Chile, Costa Rica, Honduras, the European Union or other CETA beneficiaries, and beneficiaries of the Canada-UK TCA.
Q4. Is the licensing intended to restrict the quantity or value of imports, and if not, what are its purposes? Have alternative methods of accomplishing the purposes been considered and if so which? Why have they not been adopted?
Tariff Preference Levels (TPL) are special FTA provisions that provide tariff preferences for imports of non-originating textile and apparel goods up to a specified quantity. Above these specified quantities, non-originating textile and apparel goods are subject to the Most-Favoured-Nation rate of duty. The import licensing system is in place in order to implement quantitative import limits on goods shipped in connection with TPL provisions established pursuant to the Free Trade Agreements.
Origin quotas are alternative rules of origin that enable preferential tariff access for imports of eligible textile goods up to a specified quantity. Above these specified quantities, textile goods that do not meet the main rules of origin are subject to the Most-Favoured-Nation rate of duty. The import licensing system is in place in order to implement quantitative import limits on goods shipped in connection with origin quota provisions established pursuant to the CETA and the Canada-UK TCA.
Q5. Cite the law, regulation and/or administrative order under which the licensing is maintained. Is the licensing statutorily required? Does the legislation leave designation of products to be subjected to licensing to administrative discretion? Is it possible for the government (or the executive branch) to abolish the system without legislative approval?
The Export and Import Permits Act provides for the establishment of an Import Control List to implement an intergovernmental arrangement or to prevent the frustration or the circumvention of such arrangements. Import permits are issued for goods, including textiles, on the Import Control List.
Procedures
Q6. For products under restriction as to the quantity or value of imports (whether applicable globally or to a limited number of countries or whether established bilaterally or unilaterally):
Q6.I. Is information published, and where, concerning allocation of quotas and formalities of filing applications for licences? If not, how is it brought to the attention of possible importers? Of governments and export promotion bodies of exporting countries and their trade representatives? Is the overall amount published? The amount allocated to goods from each country? The maximum amount allocated to each importer? How to request any exceptions or derogations from the licensing requirement?
Information on TPLs and origin quotas and related formalities are published in the Canada Gazette, Canada Border Services Agency (CBSA) D-Memoranda and Customs Notice and in Notices to Importers. This information is available to customs brokers, associations and traders and upon request from Global Affairs Canada. Notices to Importers and additional information are also available on Global Affairs Canada and CBSA websites at:
TPL: http://www.international.gc.ca/controls-controles/textiles/index.aspx?menu_id=21&view=d
http://www.cbsa-asfc.gc.ca/publications/dm-md/d11/d11-4-22-eng.html
Origin Quotas: http://www.international.gc.ca/controls-controles/prod/ceta_origin_quotas-contingents_origine_aecg.aspx?lang=eng
https://www.international.gc.ca/trade-commerce/controls-controles/notices-avis/1037.aspx?lang=eng
https://www.cbsa-asfc.gc.ca/publications/cn-ad/cn17-30-eng.html
Q6.II. How is the size of the quotas determined: on a yearly, six-monthly or quarterly basis? Are there cases where the size of quota is determined on a yearly basis but licences are issued for imports on a six-monthly or quarterly basis? In the latter case, is it necessary for importers to apply for fresh licence on a six-monthly or quarterly basis?
The TPL level primary units of measure (other than for yarns) are converted into Square Metre Equivalents (SMEs) by means of conversion factors found in each FTA. The yearly TPL levels for each FTA are as follows:
- Canada-Honduras Free Trade Agreement – Fabrics and made-up goods: 1,000,000.
- Canada-Costa Rica Free Trade Agreement - Cotton or man-made fabrics and made-up goods: 1,000,000 SME; Wool fabrics and made-up goods: 250,000 SME; and Cotton or man-made fibre spun yarn: 150,000 kg.
- Canada-Chile Free Trade Agreement - Cotton or man-made fabrics and made-up goods (limited to goods of Chapter 60 of the HS): 1,000,000 SME; Wool fabrics and made-up goods: 250,000 SME; and Cotton or man-made fibre spun yarn: 500,000 kg.
- Canada-United States-Mexico Agreement - United States: Cotton or man-made fabrics and made-up goods: 15,000,000 SME; and Cotton or man-made fibre spun yarn: 1,000,000 kg; Mexico: Cotton or man-made fabrics and made-up goods: 7,000,000 SME; and Cotton or man-made fibre spun yarn: 1,000,000 kg.
- There are no allocations to importers. The TPLs are administered on a first-come, first-served basis from 1 January to 31 December each year.
The origin quotas are measured by kilograms and square metres. The yearly origin quota levels are found in Table C.3 of the Protocol on rules of origin and origin procedures of the CETA; the same list has been incorporated by reference into the Canada-UK TCA: http://international.gc.ca/trade- commerce/trade-agreements-accords-commerciaux/agr-acc/ceta-aecg/text- texte/P1.aspx?lang=eng#5_1
- There are no allocations to importers.
- The origin quotas are administered on a first-come, first-served basis from 1 January to 31 December each year.
Q6.III. Are licences allotted for certain goods partly or only to domestic producers of like goods? What steps are taken to ensure that licences allocated are actually used for imports? Are unused allocations added to quotas for a succeeding period? Are the names of importers to whom licences have been allocated made known to governments and export promotion bodies of exporting countries upon request? If not, for what reason? (Indicate products to which replies relate.)
Available TPL or origin quotas quantities not used in one year are not available to carry-over to the following year.
Q6.IV. From the time of announcing the opening of quotas, as indicated in I above, what is the period of time allowed for the submission of applications for licences?
Applications for TPL and origin quota permits are accepted until the TPL or origin quota level for a given TPL or origin quota is filled.
Q6.V. What are the minimum and maximum lengths of time for processing applications?
Permit applications input directly into the control system, with no errors, are issued immediately. Applications which require further information, or data entry at GAC are issued within 48 hours. Applications with complex issues may take longer.
Q6.VI. How much time remains, at a minimum, between the granting of licences and the date of opening of the period of importation?
Not applicable because import permits are issued on a first-come, first-served basis.
Q6.VII. Is consideration of licence applications effected by a single administrative organ? Or must the application be passed on to other organs for visa, note or approval? If so, which? Does the importer have to approach more than one administrative organ?
Consideration of permit applications is effected by a single administrative organ.
Q6.VIII. If the demand for licences cannot be fully satisfied, on what basis is the allocation to applicants made? First come, first served? Past performance? Is there a maximum amount to be allocated per applicant and, if so, on what basis is it determined? What provision is made for new importers? Are applications examined simultaneously or on receipt?
TPLs and origin quotas are made available on a first-come, first-served basis, whereby import permits are issued to importers on demand until the TPL or origin quota has been filled in a given year.
Q6.IX. In the case of bilateral quotas or export restraint arrangements where export permits are issued by exporting countries, are import licences also required? If so, are licences issued automatically?
Q6.X. In cases where imports are allowed on the basis of export permits only, how is the importing country informed of the effect given by the exporting countries to the understanding between the two countries?
Not applicable.
Q6.XI. Are there products for which licences are issued on condition that goods should be exported and not sold in the domestic market?
No.
Q7. Where there is no quantitative limit on importation of a product or on imports from a particular country:
Q7.a. How far in advance of importation must application for a licence be made? Can licences be obtained within a shorter time-limit or for goods arriving at the port without a licence (for example, owing to inadvertency)?
Q7.b. Can a licence be granted immediately on request?
Q7.c. Are there any limitations as to the period of the year during which application for licence and/or importation may be made? If so, explain.
Q7.d. Is consideration of licence applications effected by a single administrative organ? Or must the application be passed on to other organs for visa, note or approval? If so, which? Does the importer have to approach more than one administrative organ?
Q8. Under what circumstances may an application for a licence be refused other than failure to meet the ordinary criteria? Are the reasons for any refusal given to the applicant? Have applicants a right of appeal in the event of refusal to issue a licence and, if so, to what bodies and under what procedures?
Import permits are not normally refused if the criteria relating to issuance are met. If a permit is refused, for example, because of incomplete information on the application, the applicant is advised and given the opportunity to correct the anomaly.
Eligibility of Importers to Apply for Licence
Q9. Are all persons, firms and institutions eligible to apply for licences: (If not, is there a system of registration of persons or firms permitted to engage in importation? What persons or firms are eligible? Is there a registration fee? Is there a published list of authorized importers?) a) under restrictive licensing systems? b) under non-restrictive systems?
Applicants are eligible if they are a "resident of Canada." "Resident of Canada" is defined as meaning, in the case of a natural person, a person who ordinarily resides in Canada and, in the case of a corporation, a corporation having its head office in Canada or operating a branch office in Canada.
Documentational and Other Requirements for Application for Licence
Q10. What information is required in applications? Submit a sample form. What documents is the importer required to supply with the application?
Instructions and the information required to complete an import permit application and the form can be found on the web at:
Q11. What documents are required upon actual importation?
Import permits and normal customs entry forms are required.
Q12. Is there any licensing fee or administrative charge? If so, what is the amount of the fee or charge?
Any applicant may directly apply for a permit via customs brokers equipped with authorized computer terminals. Permit fees range from CAN$10.00 to CAN$26.00 (according to the value of the goods). This fee does not cover the cost of any additional services provided by such issuers.
Permits may also be requested, by email, from Global Affairs Canada for which the associated fees range from CAN$15.00 to CAN$31.00 (according to the value of the goods).
Q13. Is there any deposit or advance payment requirement associated with the issue of licences? If so, state the amount or rate, whether it is refundable, the period of retention and the purpose of the requirement.
No.
Conditions of Licensing
Q14. What is the period of validity of a licence? Can the validity of a licence be extended? How?
A permit is valid for 30 days. Should the permit expire, the cancellation and subsequent issuance of a replacement permit may be completed upon request.
Q15. Is there any penalty for the non-utilization of a licence or a portion of a licence?
No.
Q16. Are licences transferable between importers? If so, are any limitations or conditions attached to such transfer?
Licences are not transferable.
Q17. Are any other conditions attached to the issue of a licence? a) for products subject to quantitative restriction? b) for products not subject to quantitative restriction?
No.
Other Procedural Requirements
Q18. Are there any other administrative procedures, apart from import licensing and similar administrative procedures, required prior to importation?
No.
Q19. Is foreign exchange automatically provided by the banking authorities for goods to be imported? Is a licence required as a condition to obtaining foreign exchange? Is foreign exchange always available to cover licences issued? What formalities must be fulfilled for obtaining the foreign exchange?
Import permits issued pursuant to the Export and Import Permits Act are not a condition of foreign exchange transactions.