Notice to Importers

Beef and Veal (Items 114 to 116 on the Import Control List)

Serial No. 846
Date: October 30, 2013

Table of Contents


1.0 Purpose

1.1 The purpose of this Notice is:

  1. to outline the Minister's policies and practices respecting the administration of the beef and veal tariff rate quota (TRQ). This Notice should be read in conjunction with the Export and Import Permits Act (EIPA), the EIPA Regulations, and/or the Allocation Method Order (Beef and Veal). Where elements of the present Notice augment the EIPA, the Regulations and/or the Allocation Method Order, those elements are to be read as expressions of the Minister's normal policies and procedures; and,
  2. to invite applications for quota shares of the beef and veal TRQ available for allocation for the period January 1 to December 31, 2014.

Note: For 2014 allocations, the relevant base period for processing and import activities in connection with an application for quota is 16 months from January 1, 2002 to April 30, 2003 (pro-rated to a 12 month period), or a more recent period from August 1, 2012 to July 31, 2013, whichever the applicant chooses.

Note: Applications from firms applying for a share of the TRQ must be accompanied by an original affidavit and a letter from an independent qualified professional, such as an accountant, certifying the information included in the application. In an application for a share of the 2014 TRQ, no accountant's letter is required where an applicant selects the base period of January 1, 2002 to April 30, 2003, provided that the applicant selected the same base period in an application for a share of the 2005, 2006, 2007, 2008, 2009, 2010, 2011, 2012 and/or 2013 TRQ, and that the necessary documentation was provided.

2.0 Coverage

2.1 This Notice replaces Notice to Importers No. 830, dated October 22, 2012. It refers to items 114 to 116 of the Import Control List (ICL) covering fresh, chilled or frozen beef and veal imported from countries other than the United States, Mexico, Chile or Peru under headings 02.01 and 02.02 in the List of Tariff Provisions set out in the Schedule to the Customs Tariff.

3.0 Duration

3.1 This Notice will remain valid until December 31, 2014.

4.0 Authority

4.1 Each of the products covered by this Notice was added to the Import Control List (ICL) pursuant to paragraphs 5(1)(a), (b), (d) and (e) and sections 5.3 and 6 of the Export and Import Permits Act (EIPA) in order to implement a Canadian commitment under the World Trade Organization (WTO) Agreement on Agriculture.

4.2 Under TRQs, imports are subject to low “within access commitment” rates of duty up to a predetermined limit (i.e., until the import access quantity has been reached); imports over this limit are subject to higher “over access commitment” rates of duty. Under section 6.2 of the EIPA, the Minister may: a) determine an import access quantity allowed entry at the low rate of duty; b) establish a method of allocating the import access quantity; and c) issue an import allocation to any resident of Canada that applies for an allocation, subject to the regulations and any terms and conditions the Minister may specify in the allocation.  Also pursuant to section 6.2 of the EIPA, the Minister may consent to the transfer of import allocations.  Having established an import access quantity, the Minister shall, under subsection 8.3(1) of the EIPA, issue import permits to allocation holders that apply for permits, up to the limit of that quantity, subject to compliance and application of regulations made under section 12 of the EIPA.  These permits shall entitle the goods to which they apply to be subject to the low “within access commitment” rates of duty.  Subsection 8.3(3) allows the Minister to issue permits in excess of the access quantity. 

4.3 Pursuant to subsection 6 (f) of the Import Allocation Regulations, when deciding whether to issue an import allocation or whether to consent to a transfer, the Minister shall take into account whether the import allocation holder has furnished false or misleading information in connection with any reports required by the Act or the regulations made under the Act or by any condition of an import allocation or import permit during the 12-month period preceding the period in respect of which the import allocation or transfer is to apply.

4.4 Pursuant to subsection 10 (1) of the EIPA, the Minister may amend, suspend, cancel or reinstate any permit or import allocation issued or granted under the Act.

5.0 General information

5.1 There are three components to a TRQ: a low duty rate, a minimum access commitment (or "import access quantity") allowed entry at that rate, and a higher duty rate. Imports at the low "within access commitment" rate of duty for beef and veal are duty-free. The global minimum access commitment for beef and veal is 76,409,000 kilograms, within which there are two country-specific reserves: an allocation of 29,600,000 kilograms reserved for imports from New Zealand (NZ) and an allocation of 35,000,000 kilograms reserved for imports from Australia. The balance of the TRQ, 11,809,000 kilograms (known as the MFN reserve), is reserved for imports from all other eligible suppliers, including those from New Zealand and Australia once their country-specific allocations are filled. Goods imported in excess of the minimum access commitment may incur the higher "over access commitment" rate of duty, which is 26.5%. For the purpose of administering the beef and veal TRQ, the quota year is the calendar year.

5.2 Once the MFN reserve is filled, all imports from countries other than Australia and New Zealand, and from those countries also once their country-reserves are filled, will be subject to the higher "over access commitment" rate of duty unless a supplementary permit has been issued pursuant to paragraph 5.4 of this Notice, regardless of whether the importer has an unused quota allocation.

5.3 Importers allocated a share of the TRQ (or "import allocation") will be allowed to import beef from any eligible non-FTA country (for purposes of this Notice, the term "non-FTA" should be read to mean countries other than the United States, Mexico, Chile or Peru). Shipments from New Zealand will be counted against the New Zealand reserve. Once the New Zealand reserve is filled, any further New Zealand imports will be counted against the remaining TRQ in the MFN reserve, if any. Shipments from Australia will be counted against the Australian reserve. Once the Australian reserve is filled, any further Australian imports will be counted against the remaining TRQ available in the MFN reserve, if any. Once the MFN reserve is filled, only imports of non-FTA beef and veal from a country whose country-reserve is not filled, if any, will be permitted at the low rate of duty (unless the product is imported under a supplementary import permit, see paragraph 5.4). Foreign Affairs, Trade and Development Canada (DFATD) publishes a daily report on its website outlining the fill rate in the Australian, New Zealand and MFN reserves. Firms are encouraged to monitor closely the fill rate in the various reserves and manage their purchasing decisions accordingly.

5.4 The Minister may authorize supplemental imports of beef and veal in excess of the 76,409 tonne TRQ. The policy concerning supplemental beef imports is delineated in the Notice to Importers No. 855, dated June 9, 2014.

6.0 Allocation of the Beef and Veal TRQ

Note: For 2014 allocations, the relevant base period for processing and import activities in connection with an application for quota is 16 months from January 1, 2002 to April 30, 2003 (pro-rated to a 12-month period), or a more recent period from August 1, 2012 to July 31, 2013, whichever the applicant chooses.

6.1 The TRQ will be allocated to firms resident in Canada. Firms with an import allocation may apply for import permits (i.e., "specific import permits"), which are normally issued on demand to allocation holders up to the amount of their import allocation. (Please also see Section 13 of this Notice.)

6.2 Eligible processors and retailer-processors will receive a share of the allocation of 57,307,000 kilograms (equivalent to 75% of the TRQ); the balance of the TRQ, 19,102,000 kilograms (equivalent to 25% of the TRQ), will be allocated to distributors. Allocation in both categories is done on a market-share basis.

6.3 For purposes of this Notice, a "processor" is an establishment that substantially changes the appearance or nature of beef and veal; such processes include to de-bone, slice, comminute, thermally process, preserve, dehydrate, ferment, render, fractionate, defibrinate, or add to the product. It does not include such activities as to dress, trim, refrigerate, freeze, package or defrost product.

6.4 Retailers that engage in some of the eligible processing activities outlined in paragraph 6.3 may qualify as "retailer-processors".

6.5 Processors' and retailer-processors' import allocations will be determined in accordance with the amount of non-FTA beef and veal processed in their own facilities in the period January 1, 2002 to April 30, 2003 (pro-rated to 12-months), or a more recent period from August 1, 2012 to July 31, 2013, whichever the applicant chooses. Please note that this amount includes any non-FTA beef and veal imported by another firm.

6.6 For purposes of this Notice, "distributors" are establishments that buy beef and veal (i.e. take ownership and financial responsibility therefor) and re-sell it to other businesses. Distributors maintain warehouses and trucks in carrying on their trade, although the renting or purchasing of warehousing and transportation services is considered to meet this criterion. Commission brokers do not meet this definition.

6.7 Distributors' import allocations will be determined on the basis of imports of non-FTA beef and veal in the period January 1, 2002 to April 30, 2003 (pro-rated to 12-months), or a more recent period from August 1, 2012 to July 31, 2013, whichever the applicant chooses. In determining its total imports for inclusion in their 2014 application, a distributor may only include (i) non-FTA beef and veal imports carried out under the authority of an import permit issued to the applicant and (ii) beef and veal, if any, that it imported at the 26.5% over-access rate of duty.

6.8 All import allocations expire at the end of each calendar year, and all firms interested in receiving an import allocation must re-qualify each year.

7.0 Advances on 2014 import allocations

7.1 To ensure an orderly transition to the 2014 quota year, processors, retailer-processors and distributors holding shares of the 2013 beef and veal TRQ will be issued advances on their 2014 import allocations up to a maximum of 30% of their 2013 import allocations or a minimum of 18,144 kg. Requests for advances from firms likely to be subject to an under-utilization penalty (pursuant to paragraph 10.0) will be evaluated on a case-by-case basis.

Note: An advance will only be issued if a completed 2014 application has been received.

8.0 Application for shares of the 2014 beef and veal TRQ

8.1 All applicants must complete the application form attached as Appendix 3. Please note that in addition to the total imports data (for distributors) and processing data (for processors and retail-processors) for either the period January 1, 2002 to April 30, 2003 or August 1, 2012 to July 31, 2013, applicants are required to provide with their application a monthly breakdown of the relevant imports or processing activities for either the full 16-month period starting January 1, 2002 to April 30, 2003 or from August 1, 2012 to July 31, 2013, (please see attachments to the application form in Appendix 3).

8.2 The declaration in the application form allows DFATD and its representatives access to any information pertaining to the applicant in relation to the application for an import allocation or to subsequent applications for, or concerning the use of, import permits that is in the files of Agriculture and Agri-Food Canada or the Canadian Food Inspection Agency. Normally, applicants are informed of any such requests for information.

8.3 Applications from firms applying for a share of the TRQ allocated to processors and retailer-processors must be accompanied by an affidavit. Furthermore, a verification letter from an independent qualified professional such as an accountant is required certifying a) that the applicant meets the definition of processor activity, and b) confirming the amount of non-FTA beef and veal processed in the applicant's own facilities in either the period January 1, 2002 to April 30, 2003 or August 1, 2012 to July 31, 2013. A model affidavit is attached as Appendix 5. A model verification letter is attached as Appendix 6. Only original affidavits and verification letters in the same format as the model will be accepted. In an application for a share of the 2014 TRQ, no accountant's letter is required where an applicant selects the base period of January 1, 2002 to April 30, 2003, provided that the applicant selected the same base period in an application for a share of the 2005, 2006, 2007, 2008, 2009, 2010, 2011, 2012 and/or 2013 TRQ, and that the necessary documentation was provided.

8.4 Applications from firms applying for a share of the TRQ allocated to distributors must be accompanied by an affidavit. Furthermore, a verification letter from an independent qualified professional such as an accountant is required certifying the firm's total imports of non-FTA beef and veal in either the period January 1, 2002, to April 30, 2003 or August 1, 2012 to July 31, 2013. A model affidavit is attached as Appendix 7. A model verification letter is attached as Appendix 8. Only original affidavits and verification letters in the same format as the model will be accepted. In an application for a share of the 2014 TRQ, no accountant's letter is required where an applicant selects the base period of January 1, 2002 to April 30, 2003, provided that the applicant selected the same base period in an application for a share of the 2005, 2006, 2007, 2008, 2009, 2010, 2011, 2012 and/or 2013 TRQ, and that the necessary documentation was provided.

8.5 For the purpose of this Notice, "accountant" is defined as a member in good standing of one of the three professional accounting bodies in Canada (C.A., C.G.A. or C.M.A.) who is registered with his/her provincial professional organization to provide accounting services and is independent from the applicant (i.e., is not an owner, or a partner of the company applying for an import allocation, and is not in an employee - employer relationship which involves the applicant).

8.6 Companies that engage in both processing and distributing activities may apply under both categories.

8.7 For processors' and retailer-processors' import allocation, the purchase invoices showing the usage of beef and veal imported from non-FTA countries must clearly state the name and address of the purchaser, the date of importation or purchase and consignment, the weight and the country of origin. Only fresh, chilled or frozen beef and veal falling within Customs Tariff headings 02.01 and 02.02 may be included in the amount of goods imported.

8.8 For distributors' import allocation, the purchase invoices showing the beef and veal imported from non-FTA countries must clearly state the name and address of the purchaser, the date of importation or purchase and consignment, the weight, value, type of product imported and that the product was exported from non-FTA countries. Only fresh, chilled or frozen beef and veal falling within Customs Tariffheadings 02.01 and 02.02 may be included in the amount of goods imported. To be counted, beef and veal purchases must have been delivered to the importer within the period selected by the applicant (i.e., January 1, 2002 and April 30, 2003 or August 1, 2012 to July 31, 2013). The applicant must also have paid for the product in the same period.

8.9 Only fresh, chilled or frozen beef and veal falling within Customs Tariff headings 02.01 and 02.02 may be included in the quantity of goods imported. Generally, this is beef and veal that has neither been cooked nor had spices added to it. Questions as to whether particular imports of beef and veal fall under the above-mentioned tariff headings should be addressed to Canada Border Services Agency, Tariff Division, Programs Branch, 613-957-1468; fax: 613-952-3971.

8.10 Estimates of total processing activity or total imports based on statistical sampling techniques and findings resulting from such techniques are not acceptable nor allowed for the purposes of this Notice. Applications for import allocations from firms found using such techniques will be deemed incomplete.

8.11 The information that the applicant provides will be considered when allocating the TRQ. DFATD retains the right to request additional information. Any costs associated with a request for additional information will be borne by the applicant. Failure to provide information requested may result in the application being deemed incomplete.

9.0 Submission of applications for import allocations

9.1 Applications must include a fully completed application form attached as Appendix 3 and MUST BE postmarked December 1, 2013, or earlier.

9.2 Applications sent by MAIL or COURIER should be addressed to the beef and veal quota manager at DFATD. The name and mailing address of the beef and veal quota manager can be obtained on the DFATD website, under Contact Us.

9.3 APPLICATIONS SENT BY FACSIMILE WILL NOT BE ACCEPTED. ONLY ORIGINAL APPLICATIONS WILL BE ACCEPTED.

9.4 Applications sent after December 1, 2013 will not be considered. Claims for lost applications will not be considered without acceptable proof (e.g., courier receipt).

10.0 Adjustment for under-utilization

10.1 Firms that import less than 90 percent of their allocation (calculated as the initial allocation plus any reallocated quota, plus any returns received before October 31st) in any one year may receive an allocation in the next year that reflects the actual level of use. The under-utilization penalty may be waived if the total amount of the shortfall is less than 9,000 kilograms.

11.Quota Return and Re-allocation

11.1 Firms that cannot fully utilize their allocation are encouraged to return any portion of their quota that they believe will be unused. Quota holders can return quota by sending a letter, facsimile or e-mail to DFATD (contact information listed in section 15.1) indicating the amount returned. Firms are encouraged to return their unused quota, if any, as early as possible to allow it to be re-allocated to other importers. The latest date to return unused quota is October 31 each year. Quota returned on or before the above deadline will not be considered unused for the purpose of administering the under-utilization penalty.

11.2 Quota that is returned under the beef and veal TRQ will be re-allocated to applicants on a first-come, first-served basis. Applications can be submitted by sending a letter, facsimile or e-mail to DFATD indicating the amount requested.  DFATD officials will hold any applications that arrive on or after September 15 each year in a queue until there is a sufficient quantity of returned quota to accommodate the first request in the queue. Applications received prior to September 15 of a year may be accommodated if there is sufficient returned quota available at the time of request, but if there is not, such early applications will be rejected and not held in queue.

11.3 In re-allocating returned quota, DFATD will take into consideration the amount of quota an applicant is requesting. The amount requested must be reasonable and reflect the applicant's normal usage of non-FTA beef and veal. Incomplete applications (e.g., that do not specify a quantity) will be rejected and not held in the queue. Applicants who do not import 90 percent of the volume re-allocated to them by the end of the calendar year will face an under-utilization penalty in connection with their allocation, if any, in the next year.

11.4 If there is only a small quantity of returned quota and no interested applicant, DFATD may consider other types of requests for smaller quantities (e.g., applicants seeking to top off a load).

12.0 Transferability of import allocations

12.1 The transfer (i.e., purchase, sale or rent) of import allocations between processors, retailers-processors and distributors is prohibited. However, a firm may sell imported non-FTA beef and veal to another firm after the product has been cleared through Customs. Processors and retailer-processors should, however, be mindful that such sales will affect their processing figures that will be used in calculating their 2015 allocation. When calculating their imports for the purpose of applying for an allocation, distributors may not count imports made by another firm and sold to the distributor once the product has entered Canada.

12.2 DFATD does not prohibit companies with allocations from utilizing the services of importers or brokers to source beef and veal. However, the firm to whom a permit is issued MUST be the same as the importer of record on Canada Border Services Agency's B3 customs entry document.

13.0 Import Permit Issuance

13.1 Import permits are required for each shipment of beef and veal falling within headings of 02.01 and 02.02 of the Customs Tariff. Importers may either invoke General Import Permit (GIP) No. 100, a copy of which is available on request, or present a "specific import permit" issued to their firm by DFATD for that shipment to clear Canada Border Services Agency. Those citing the GIP will be permitted to import unlimited quantities of beef and veal, but such imports will be subject to the higher "over access commitment" rate of duty. Those presenting a specific import permit to Canada Border Services Agency at the time of final accounting may enter their shipments at the low "within access commitment" rate of duty if there is quota remaining for the country from which the shipment originates. Note: specific import permits will not be issued for shipments already imported into Canada under the authority of the general import permit, regardless of the applicant's import allocation.

13.2 The following procedures are in place for receiving applications for import permits:

  1. When requesting an import permit, an applicant must submit a completed Form EXT-1466, "Application for Permit" (a copy of which is attached as Appendix 1).
  2. A description of the process for applying for a permit is attached as Appendix 2, including information about fees, the monthly billing system, and information required from applicants. All import permits are issued either
    1. through an on-line automated system in the offices of brokers in major centres across Canada, or
    2. in the office of DFATD (contact information listed in section 15.2).
  3. Import permits are normally issued with a validity period of 30 days around the date of arrival specified by importers (5 days prior to it and 24 days after). Under no circumstances will utilization of permits for one quota year be allowed in the next quota year.
  4. Requests for import permits will be accepted within the 30 days prior to the expected arrival date of the shipment in Canada.
  5. A list of customs brokers having access to the on-line computer system may be obtained from DFATD on request.

13.3 In completing the "Application for Permit", importers are required to use the product codes and categories shown in Appendix 4. These codes and categories have been established for administrative and statistical purposes. The product categories are the same for both global and supplementary permits but product codes are different.

13.4 Non-FTA fresh, chilled or frozen beef and veal imported directly into a bonded warehouse do not require either a specific import permit or a general import permit. However, a permit is required to move goods out of a bonded warehouse for consumption in Canada.

13.5 The name on the specific import permit must match EXACTLY the name of the importer on Canada Border Services Agency's B3 customs entry and related documents at time of final accounting. Where the consignee on the import permit and the name of the importer on the B3 are not the same entity, the permit will be declared invalid. It is incumbent on the allocation holder to ensure that applications for permits are made in the name of the importer of record. Questions about the proper procedures to fill out customs entry documents should be addressed to local Canada Border Services Agency officials.

13.6 For all products on the ICL, the weight listed on the permit must be the same as the net weight quantity on the customs invoice.

13.7 NOTE: Import permits will not normally be extended beyond the 30 days validity period in the case where there is no remaining availability in the MFN pool.

14.0 Permit Fees

14.1 A fee will be levied for each permit or certificate issued in accordance with the Export and Import Permits and Certificates Fees Orders (Notice to Importers No. 508 dated May 16, 1995).

15.0 Further information

15.1 Names and direct phone numbers for quota manager(s), permit officer(s), and the Help Desk are available on the DFATD website: Contact Us.

15.2 For directory assistance, you may call 613-944-0773.

15.3 Unless otherwise specified by the applicant, DFATD officials communicate with an applicant in the official language of Canada utilized by the applicant on the application.