Serial No. 826
Date: November 23, 2012
1.1 The purposes of this Notice are:
a) to inform importers of the Minister’s policies and practices respecting the administration of the tariff rate quota (TRQ) for Broiler Hatching Eggs and Chicks for chicken production. It should be read with the Import Allocation Regulations and the Import Permit Regulations. Where elements of the present Notice augment these Regulations, those elements are to be read as expressions of the Minister’s normal practices and procedures; and
b) to invite applications for quota shares of the Broiler Hatching Egg and Chick TRQ available for allocation for the period January 1 to December 31, 2013.
1.2 This Notice should be read in conjunction with the most recent Notice to Importers governing the administration of supplemental imports for Broiler Hatching Eggs and Chicks for chicken production which is available on the Foreign Affairs and International Trade Canada (DFAIT) Internet site: http://www.international.gc.ca/controls-controles/prod/agri/incubation/index.aspx?menu_id=24&view=d.
2.1 This Notice replaces Notice to Importers No. 794 of October 21, 2011. It refers to Items 94 and 95 of the Import Control List (ICL), namely live broilers for domestic production, being fowls of the species Gallus domesticus, weighing not more than 185 grams, that are classified under tariff item No. 0105.11.21 or 0105.11.22 in the List of Tariff Provisions set out in the schedule to the Customs Tariff; and hatching eggs, for broilers, of fowls of the species Gallus domesticus, that are classified under tariff item No. 0407.11.11 or 0407.11.12 in the List of Tariff Provisions set out in the schedule to the Customs Tariff.
3.1 This Notice will remain in effect until December 31, 2013.
4.1 Each of the products covered by this Notice was added to the 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 re-instate any permit or import allocation issued or granted under the Act.
5.1 The combined annual access level for 2013 for imports of broiler hatching eggs and chicks shall be 21.1% of estimated domestic production of broiler hatching eggs for 2013. This estimate will be adjusted and finalized in August 2013, when final production figures are available. The calculation of domestic production includes exports, but excludes imports.
5.2 The combined annual access level is subdivided into two separate and distinct access levels for broiler hatching eggs and for chicks. Separate import allocations will be issued to all eligible applicants. A company which receives an allocation for broiler hatching eggs may convert any portion of this allocation into an egg-equivalent (EE) allocation for chick imports at a conversion rate of 1.27 broiler hatching eggs for one chick. Chick import allocations may not, however, be converted into hatching egg import allocations.
5.3 The annual access level for broiler hatching eggs shall be 17.4% of the estimated domestic broiler hatching egg production for the year. The annual access level for EE chicks shall be 3.7% of the estimated domestic broiler hatching egg production for the year.
6.1 The broiler hatching egg and chick TRQ is allocated to federally-registered hatcheries on the basis of market share.
6.2 The term market share, as used in this Notice, means an applicant's share of the total number of chicks hatched by all successful applicants during the period October 1, 2011 to September 30, 2012 as reported to DFAIT for the purpose of obtaining an import allocation.
7.1 Federally-registered hatcheries that receive an import allocation will be permitted to import up to 95% of this allocation prior to August 1, 2013. Allocation holders will be informed by letter regarding the remaining 5%, with adjustments, if any, after the overall import access quantity for 2013 is finalized in August 2013.
7.2 A penalty will normally be assessed for import allocation under-utilization in the next year to allocation holders whose actual utilization of either their chick or egg allocation is less than 90%1. An allocation for the next year will normally be adjusted downward in percentage to the total under-utilization (in egg equivalents) of these two quantities by that company during the 12-month period preceding the calendar year during which the import allocation is to apply2. The calculation will normally take into account the weight of the chick or egg import allocation relative to the overall total.
8.1 Federally-registered hatcheries applying for an import allocation on the basis of market share must provide supporting information on the total number of chicks hatched for chicken meat production for the period October 1, 2011 to September 30, 2012.
8.2 Applicants must submit copies of their weekly Report of Chicken Hatchery Operations prepared for Agriculture and Agri-Food Canada and/or Provincial Boards or Commissions. Market share, determined on the basis pursuant to paragraph 6.2, is subject to verification by DFAIT.
8.3 Applications must also include the following information:
8.4 Applicants for an allocation are required to provide a list of related persons. Applicants should consult Appendix 1 for the definition of related persons as it applies for the purpose of this Notice.
9.1 Applications MUST be postmarked December 21, 2012 or earlier. Applications sent by MAIL or COURIER should be addressed to:
Mr. Edouard Huot
Trade Controls Policy Division
Foreign Affairs and International Trade Canada
125 Sussex Drive
9.2 Companies submitting late applications will not be considered for a share of the 2013 TRQ.
9.3 Applications sent by facsimile will not be accepted. Only original applications will be accepted.
10.1 The review and processing of applications by DFAIT may unavoidably result in delays in the notification of allocations to importers. DFAIT will make every effort to inform all applicants of their allocation, if any, in early 2013; in the meantime eligible applicants may apply for permits from January 1, 2013.
11.1 Supplemental import permit requests from applicants will only be considered if they and their related hatcheries have utilized their annual import allocations of both broiler hatching eggs and chicks within a given quarter of the year on a cumulative basis, according to the following schedule:
The applicable utilization rate is determined by the date of delivery, not the date of the request.
12.1 The Minister may allow the transfer of import allocations among allocation holders. All requests for transfer of import allocations must be referred to DFAIT for consideration.
13.1 Import permits are required for each shipment of broiler hatching eggs and chicks falling under tariff item Nos. 0407.11.11 or 0407.11.12 and 0105.11.21 or 0105.11.22, respectively, in the List of Tariff Provisions set out in the schedule to the Customs Tariff. Importers may either invoke General Import Permit (GIP) No. 100 - Eligible Agricultural Goods, a copy of which is available on request, or present an import permit issued by DFAIT to their firm for that shipment (specific import permit) in order to clear Canada Customs. The specific import permit must also be presented to Canada Border Services Agency at the time of accounting for the shipment to be eligible for classification under tariff item No. 0407.11.11 or 0105.11.21. Goods imported without a specific import permit (i.e. those invoking the GIP) will be subject to classification under tariff item No. 0407.11.12 (broiler hatching eggs), for which the duty is 238% (but not less than 2.91$/dzn), or under tariff item No. 0105.11.22 (chicks), for which the duty is 238% (but not less than 30.8¢ each). Note: Specific permits will not be issued for shipments already imported into Canada under the authority of the GIP, regardless of the importer’s import allocation.
14.1 An individual import permit is required for each shipment of broiler hatching eggs and chicks to enter Canada under the TRQ.
14.2 Import permits are issued through an on-line automated system either (a) in the offices of customs brokers in major centres across Canada, or (b) at DFAIT in Ottawa (address listed in paragraph 9.1).
14.3 A list of customs brokers having access to the on-line computer system may be obtained from DFAIT on request.
14.4 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.
15.1 Requests for import permits will be accepted within the 30 days prior to the expected date of arrival of the shipment in Canada. When requesting an import permit, applicants should complete form EXT-1466: Application for Permit, and transmit it to the agents referred to in paragraph 18.2 of this Notice.
15.2 In completing import permit applications, the following codes should be used to describe the product to be imported:
15.3 The possession of an import permit does not relieve importers from the obligation to comply with other legislative requirements, such as those administered by the Canadian Food Inspection Agency and the Canada Border Services Agency
16.1 Effective January 1, 1995, hatching eggs of the species Gallus domesticus (chicken) other than for broilers are captured under Item 135 of the ICL. They are classified under tariff item No. 0407.11.91 or 0407.11.92 in the List of Tariff Provisions set out in the schedule to the Customs Tariff. Import permits are required for EACH shipment of hatching eggs falling within these tariff items. Importers may either invoke General Import Permit No. 100 - Eligible Agricultural Goods, a copy of which is available on request, or present an import permit issued to their firm for that shipment (specific import permit) to clear Canada Customs. The specific import permit must also be presented to Canada Border Services Agency at the time of accounting for the shipment to be eligible for classification under tariff item No. 0407.11.91 and allowed entry at the low rate of duty. Those without a specific import permit (i.e. those invoking the GIP) will be subject to classification under tariff item No. 0407.11.92, for which the duty is 163.5% (but not less than 79.9¢/dzn). Note: Specific permits will not be issued for shipments already imported into Canada under the authority of the GIP.
16.2 There are no import access quantities for hatching eggs other than for broilers into Canada. Applications for specific import permits for hatching eggs other than for broilers will be issued on request.
16.3 In completing the Application for Permit form, importers are requested to use code 0407.11.91.00.0000 to describe the product to be imported.
16.4 The possession of an import permit does not relieve importers from the obligation to comply with other legislative requirements, such as those administered by the Canadian Food Inspection Agency and the Canada Border Services Agency.
17.1 A fee will be levied for each supplemental import permit issued in accordance with the Export and Import Permits and Certificates Fees Order (Notice to Importers No. 508 dated May 16, 1995).
18.1 Enquiries about import allocations may be addressed to:
Mr. Edouard Huot (Trade Policy Officer)
(Address as indicated in paragraph 9.1)
18.2 Enquiries about permit issuance and utilization of import allocations may be addressed to:
Ms. Adèle Brisson
Utilization Rate (%) = (Actual Level of Use (EE) / Total Allocation Granted (EE)) X 100%
Actual Level of Use (EE) = Permits Used (EE) + Transfers Out (EE)
Total Allocation Granted (EE) = Initial Allocation (EE) + Transfers In (EE)
Underutilization Penalty (EE) = Pre-penalty Allocation (EE) X Underutilization Rate (%)
“Pre-penalty Allocation (EE)” is the allocation that the allocation holder would have been eligible for in the new quota year, if the allocation holder had not under-utilized in the previous quota year.
Underutilization Rate (%) = 100% - Utilization Rate (%)