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CUSMA: Chicken TRQ – Serial No. 988

Date: October 1, 2020

This Notice replaces Notice to Importers No. 1029 dated June 15, 2020, and sets out the policies and practices pertaining to the administration of Canada’s tariff rate quota (TRQ) for chicken under the under the Canada-United States-Mexico Agreement (CUSMA).

This Notice is provided pursuant to the authority of the Export and Import Permits Act (EIPA) and its corresponding regulations, and remains in effect until further notice.

Table of contents

1. Definitions

Chicken means a product that is included in Items 96 to 104 on the Import Control List (ICL), namely chicken and chicken products falling under tariff items 01.05, 02.07, 02.09, 02.10, 16.01 and 16.02 in the list of tariff provisions set out in the Schedule to the Customs Tariff.

Further processing means the manufacturing of products that are on the ICL. Such products include, but are not limited to, patties, nuggets, fingers, rolls or roasts produced from chicken meat; it also means marinating, smoking or drying, coating or seasoning chicken meat.

Food service operator means a restaurant or food service company that is active in the Canadian food service sector in the chicken industry.

Non-ICL products means products that are not on the ICL and that are domestically manufactured using products that are on the ICL to compete with like imported products entering Canada duty-free or at a low rate of duty.

Processing means the slaughtering of chicken, cutting up of eviscerated chicken, de-boning of eviscerated or cut up chicken, or further processing of chicken meat.

2. Allocation policy

3. Eligibility criteria

You are eligible to apply for an allocation if you are a:

Processor of non-ICL products
  • that manufactures non-ICL products, in your owned and operated Canadian establishments that are in good standing and have received processing licenses from the Canadian Food Inspection Agency (CFIA), in the reference period; and
  • sells these products at the wholesale level.
  • You must exclude the following from your application:
    • ICL products
    • products that have not been processed in Canada in CFIA-approved plants owned and operated by you;
    • products for which you have not obtained a letter of opinion from the Canada Border Services Agency (CBSA);
    • products for which you are unable to provide the finished product recipe, processing method and composition of the meat;
    • products exported, or intended to be exported, from Canada;
    • products for which only packaging was performed;
    • products sold to related persons;
    • products sold at the retail level to consumers;
    • products containing meat from old roosters or spent fowl;
    • meat-on-meat products, meaning products that contain meat other than chicken and turkey, and less than 7% of non-meat ingredients (excluding spices and seasonings);
    • brochettes, meaning products composed of chicken and other ingredients on a skewer, pick or rod;
    • mechanically separated meat;
    • finely textured meat;
    • naturally occurring and added chicken skin; and
    • added fat.
  • Note: If you use marinated chicken in your non-ICL product, you must use the pre-marinated weight of the chicken in your application.
  • If you are related to a food service operator, you may be eligible to apply for an allocation provided that:
    • you provide a written guarantee that the non-ICL products are for retail sale only;
    • you undertake to pay for an independent auditor, approved by the Department, to evaluate and certify that the products are, and will be, produced and sold for retail sale only; and
    • you undertake to have such evaluations done, at your own cost, as often as quarterly if so requested by the Department.
Distributor
  • that bought (i.e., took ownership of and financial responsibility for) at least 220,000 kg and subsequently sold at least 220,000 kg of chicken in the reference period, using warehouses and trucks in carrying out this activity.
  • You may also qualify as a distributor if you are a retail company that:
    • has separate divisions that purchase and distribute chicken to non-affiliated companies; or
    • has central buying operations and sells to corporate or franchise stores (or co-op members), and that arranges delivery and charges the individual store for warehousing and for the chicken product.
    • Note: Companies that procure or sell chicken and chicken products on behalf of others without taking ownership of or financial responsibility for the products are not eligible to apply for an allocation.
  • You must exclude the following from your application:
    • products bought and sold for the export market;
    • non-ICL products;
    • products sold to related persons;
    • products sold at the retail level to consumers;
    • products containing meat from old roosters or spent fowl;
    • products bought from or sold to other distributors; and
    • live chickens.
Food Service Operator
  • that bought and subsequently sold at least 220,000 kg of chicken in the reference period.
  • You must exclude the following from your application:
    • non-ICL products;
    • products containing meat from old roosters or spent fowl; and
    • non-chicken purchases.
  • If you are a food service operator comprised of a parent company and various subsidiaries, the parent company must submit an application, accompanied by individual application forms for each individual affiliate or business brand.
    • Note: You must exclude any individual affiliate or business brand that did not buy and subsequently sell at least 220,000 kg of chicken in the reference period.
  • In the case of food service chains, only the application submitted by the system-wide brand owner of the chain is considered for an allocation. Individual entities within that chain (e.g., franchisees) are not eligible to apply for an allocation.
Processor
  • that bought at least 250,000 kg of chicken and subsequently sold at least 250,000 kg of chicken and chicken products processed or further processed in the reference period in federally or provincially registered Canadian plants owned and operated by you.
  • You must exclude the following from your application:
    • products that were not processed in federally or provincially registered Canadian plants owned and operated by you;
    • products bought and sold for the export market;
    • non-ICL products;
    • products that you did not process (e.g., distribution sales);
    • products sold at the retail level to consumers;
    • products containing meat from old roosters or spent fowl; and
    • intra-company transfers and transactions.
  • If you are a parent company submitting joint applications by affiliated firms, you must exclude the purchases and sales of any company, whether it’s the parent company or an affiliated company, that does not meet the 250,000 kg purchase, production and sales criteria as set out above.

4. Calculation of allocations

Processors of non-ICL products
  • A maximum of 17,097,442 kg of quota is allocated to processors of non-ICL products on the basis of one kilogram of import quota for each kilogram of chicken inputs used in the production of non-ICL products in the reference period.
    • If the total amount of chicken requested for the production of non-ICL products exceeds the quantity available to processors of non-ICL products, the allocation is done on a pro-rata basis.
    • Any dark meat you require for the production of your non-ICL chicken products is supplied by the Chicken Farmers of Canada (CFC) Market Development Program (MDP). To obtain dark meat through the MDP, you should:
  • If the amount of quota you are allocated for the production of non-ICL products is insufficient to meet your manufacturing needs, you may apply for supplemental imports through the Import-to-Compete program. Supplemental import requests are authorized only for the specific inputs you require for the manufacturing of your non-ICL products. (See Notice to Importers Chicken and Chicken Products - Supplemental Imports)
    • Note: As a component of the evaluation of supplemental import requests under the Import-to-Compete program, the Department will review whether you have any remaining allocation under any TRQ for non-ICL chicken products and whether you can reasonably source the requested product from the eligible destinations under the TRQ in question. If you have not submitted an application for one of the available chicken TRQs, you may be asked to submit a written explanation as to why you did not apply for any TRQ allocation.
Traditional processors, distributors and food service operators under the World Trade Organization (WTO)
  • Traditional processors, distributors and food service operators are allocated a total of 10,523,717 kg at the same percentage they were allocated individually in the previous year, as adjusted since (e.g. for under-utilization).
Non-Traditional Distributors
  • 5,055,710 kg is allocated to distributors on an equal share basis
Non-Traditional Food service operators
  • 2,006,443 kg is allocated to food service operators on a market share basis based on the total amount of chicken purchased by the food service operator:
    • 70% is allocated to food service operators whose quantity (non-eviscerated equivalent) of chicken purchases is equal to at least 50% of their total quantity of meat purchases;
    • 30% is allocated to food service operators whose quantity (non-eviscerated equivalent) of chicken purchases is less than 50% of their total quantity of meat purchases.
    • the minimum amount allocated to a food service operator is 10,007 kg;
      • Note: In the case of a parent company with subsidiaries, the parent company’s allocation is the sum total of its eligible subsidiaries’ calculated allocations.
Non-Traditional Processors
  • are allocated any remaining quota on a market share basis based on the dollar difference between purchases and sales of processed product:
    • the minimum amount allocated to a processor is 42,094 kg.

5. Transfer, return and under-utilization of allocations

6. Information related to import permits of chicken and chicken products

7. Related links

Date Modified: