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CUSMA: Butter and Cream Powder TRQ - Serial No. 1040
Date: May 1, 2021
This Notice replaces Notice to Importers No. 1018 dated June 15, 2020 and sets out the policies and practices pertaining to the administration of Canada’s tariff rate quota (TRQ) for butter and cream powder under the Canada-United States-Mexico Agreement (CUSMA).
This Notice to Importers is provided pursuant to the authority of the (EIPA) and its corresponding , and remains in effect until further notice.
Table of contents
1. Definitions
Butter means a product that is included in Items 159 to 160 of the (ICL), namely butter falling under tariff items. 0405.10.10, 0405.20.10, 0405.90.10, and Cream Powder means a product that is included in Items 119 and 120 of the , namely cream powder falling under tariff items 0402.21.21 and 0402.29.21 in the list of tariff provisions set out in the Schedule to the .
See the List of EIPA commodity codes for butter and cream powder.
2. Allocation policy
- To be eligible, you must be active in the Canadian food or agriculture industry at the time of application, and must remain active regularly during the quota year.
- Note: You must, in addition, have been active regularly in the Canadian food or agriculture industry during the reference period.
- Individual applicants and related persons applicants are eligible for only one allocation.
- Note: All applicants must provide a list of related persons.
- Note: In the case of separate applications from related persons involving a parent company and one or more subsidiaries, only the application nominated by the parent company is considered.
- You must specify in your application the minimum quantity of quota you will accept. If your calculated market share allocation is less than 20,000 kg, you are issued an allocation only if the quantity you have specified in your application is equal to or lower than your calculated market share allocation.
- For the 2019-2020 and 2020-2021 TRQ years, 100% of processors’ allocations are reserved for the importation of goods in bulk (not for retail sale) to be used as ingredients for further food processing (secondary manufacturing). In subsequent TRQ years, this percentage will be reduced in accordance with Canada’s commitments under CUSMA as follows:
Year | Percentage of processors’ allocations reserved for importation of goods in bulk to be used as ingredients for further food processing |
---|---|
2021-2022 | 94% |
2022-2023 | 88% |
2023-2024 | 75% |
2024-2025 | 62.5% |
3. Eligibility criteria
You are eligible to apply for an allocation if you are a:
Processor
- that manufactures butter and/or cream powder in your own provincially-licensed or federally-registered facility.
Further processor
- that uses butter and/or cream powder in your manufacturing operations and product formulation.
Distributor
- that buys butter and/or cream powder and re-sells it to other businesses.
- Note: Companies that procure or sell butter and/or cream powder on behalf of others without taking ownership of or financial responsibility for the product are not eligible to apply for an allocation.
- Note: Retailers are not eligible to apply for an allocation. A retailer is an establishment that is primarily engaged in retailing food, and which buys butter and/or cream powder and sells it directly to final consumers.
4. Calculation of allocations
Processors
- 80% is allocated to processors on a market share basis based on the kilograms of butter and/or cream powder manufactured by the processor during the reference period for the importation of goods in bulk (not for retail sale) to be used as ingredients for further food processing (secondary manufacturing).
Further processors
- 10% is allocated to further processors on a market share basis based on the kilograms of butter and/or cream powder used by the further processor, in the manufacturing of further processed food products during the reference period.
Distributors
- 10% is allocated to distributors on an equal share basis.
5. Transfer, return and under-utilization of allocations
- If you wish to transfer any portion of your allocation, you must submit a transfer request form.
- Note: If you transfer any portion of your allocation, you are not eligible to receive transfers from other allocation holders during the year. If you receive a transfer, you are not eligible to transfer any portion of your allocation.
- Note: Transfer requests will normally be considered and approved on a like-for-like basis. For example, an allocation issued for the importation of goods in bulk to be used as ingredients for further food processing will be approved for transfer on this basis. The Department may require evidence that the transferred allocation is utilized in accordance with the conditions under which the TRQ was originally allocated.
- You may return any portion of your allocation to the Department in writing by the prescribed return date.
- Note: Returned quantities will normally be made available seven days after the return date to eligible allocation holders, who have not returned any portion of their allocation, in proportion to their initial allocation, or on demand if quantities still remain after the first offer.
- If you use less than 95% of your allocation in one year, you may have your allocation adjusted downward by an under-utilization penalty in the following year.
- Note: Any portion of your allocation that you transfer or return in accordance with the present policy is considered to have been used.
6. Related links
- General Information on the Administration of TRQs for Supply-Managed Products
- Key dates and access quantities
- Information concerning related persons
- How to apply for an allocation
- How to apply for an import permit
- Allocation transfer request form
- Contact us
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