BETWEEN:
ONTARIO CORN PRODUCERS’ ASSOCIATION, LA FÉDÉRATION DES PRODUCTEURS DE CULTURES COMMERCIALES DU QUÉBEC, MANITOBA CORN GROWERS ASSOCIATION
Applicants
CANADIAN PORK COUNCIL, ANIMAL NUTIRITION ASSOCIATION OF CANADA, CANADIAN CATTLEMEN’S ASSOCIATION, BREWERS OF CANADA, FOOD PROCESSORS OF CANADA, LEAF FOODS INC., ASSOCIATION OF CANADIAN DISTILLERS, COMMERCIAL ALCOHOLS INC., NEWCO COMMODITIES LIMITED, DIAGEO CANADA INC., WESTON FOODS INC., BRAR NATURAL MILLING INCORPORATED, CASCO INC., CORN PRODUCTS INTERNATIONAL INC., CANADIAN SNACK FOOD ASSOCIATION, ARCHER DANIELS MIDLAND COMPANY, PEPSI-COLA CANADA LTD., HYTEK LIMITED, GREAT LAKES ORGANIC INC., U.S. CORN COALITION, TOWNSHIP OF EDWARDSBURGH CARDINAL, ANIMAL NUTRITION ASSOCIATION OF CANADA – MANITOBA DIVISION, ONTARIO AGRI BUSINESS ASSOCIATION, ANIMAL NUTRITION ASSOCIATION OF CANADA – BRITISH COLUMBIA DIVISION, OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE, QUE PASA MEXICAN FOODS, BRADNER FARMS, BRANDY FARMS INC. & COZY PRAIRIE, MANITOBA PORK COUNCIL, SUNCOR ENERGY PRODUCTS INC., THE PEPSI BOTTLING GROUP (CANADA) CO., DEL COMAL FOODS LTD.
Heard at Ottawa, Ontario, on June 5, 2007.
Judgment delivered from the Bench at Ottawa, Ontario, on June 5, 2007.
REASONS FOR JUDGMENT OF THE COURT BY: RICHARD C.J.
Docket: A-267-06
Citation: 2007 FCA 216
CORAM: RICHARD C.J.
NADON J.A.
SEXTON J.A.
BETWEEN:
ONTARIO CORN PRODUCERS’ ASSOCIATION, LA FÉDÉRATION DES PRODUCTEURS DE CULTURES COMMERCIALES DU QUÉBEC, MANITOBA CORN GROWERS ASSOCIATION
Applicants
and
CANADIAN PORK COUNCIL, ANIMAL NUTIRITION ASSOCIATION OF CANADA, CANADIAN CATTLEMEN’S ASSOCIATION, BREWERS OF CANADA, FOOD PROCESSORS OF CANADA, LEAF FOODS INC., ASSOCIATION OF CANADIAN DISTILLERS, COMMERCIAL ALCOHOLS INC., NEWCO COMMODITIES LIMITED, DIAGEO CANADA INC., WESTON FOODS INC., BRAR NATURAL MILLING INCORPORATED, CASCO INC., CORN PRODUCTS INTERNATIONAL INC., CANADIAN SNACK FOOD ASSOCIATION, ARCHER DANIELS MIDLAND COMPANY, PEPSI-COLA CANADA LTD., HYTEK LIMITED, GREAT LAKES ORGANIC INC., U.S. CORN COALITION, TOWNSHIP OF EDWARDSBURGH CARDINAL, ANIMAL NUTRITION ASSOCIATION OF CANADA – MANITOBA DIVISION, ONTARIO AGRI BUSINESS ASSOCIATION, ANIMAL NUTRITION ASSOCIATION OF CANADA – BRITISH COLUMBIA DIVISION, OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE, QUE PASA MEXICAN FOODS, BRADNER FARMS, BRANDY FARMS INC. & COZY PRAIRIE, MANITOBA PORK COUNCIL, SUNCOR ENERGY PRODUCTS INC., THE PEPSI BOTTLING GROUP (CANADA) CO., DEL COMAL FOODS LTD.
Respondents
REASONS FOR JUDGMENT OF THE COURT
(Delivered from the Bench at Ottawa, Ontario, on June 5, 2007)
[1] This is an application for judicial review of a decision of the Canadian International Trade Tribunal (the “Tribunal”) made on April 18, 2006 with reasons issued on May 3, 2006 in which the Tribunal found that the dumping and subsidizing of grain corn originating in or exported from the United States of America have not caused injury and are not threatening to cause injury to the domestic producers of grain corn.
[2] The applicants allege that the Tribunal made three related errors:
(a) it confused the concept of price suppression with that of price depression and refused to consider price suppression as a separate head of injury as required by law;
(b) it refused to consider the 44% margin of dumping and amount of subsidy as a separate head of injury as required by law; and
(c) it based its decision on the supposedly widening price “gap” between American and Canadian corn. In doing so, the Tribunal based its decision on an issue that was never raised by anyone before it found its way in to The Tribunal’s reasons and in so doing, breached the rules of natural justice.
[3] With respect to the first two allegations, the Tribunal did not make any reversible error in reaching the conclusion it did.
[4] Section 37.1 of the Special Import Measures Regulations, SOR/84-927, as amended sets out a number of factors for the Tribunal to consider.
[5] For the purposes of determining whether the dumping or subsidizing of any goods has caused injury or retardation, the following factors are prescribed:
a) the volume of the dumped or subsidized goods and, in particular, whether there has been a significant increase in the volume of imports of the dumped or subsidized goods, either in absolute terms or relative to the production or consumption of like goods;
b) the effect of the dumped or subsidized goods on the price of like goods and, in particular, whether the dumped or subsidized goods have significantly
(i) undercut the price of like goods;
(ii) depressed the price of like goods; or
(iii) suppressed the price of like goods by preventing the price increases for those like goods that would otherwise likely have occurred;
c) the resulting impact of the dumped or subsidized goods on the state of the domestic industry and, in particular, all relevant economic factors and indices that have a bearing on the state of the domestic industry;
d) any other factors that are relevant in the circumstances.
[6] For the purpose of determining whether the dumping or subsidizing of any goods has caused injury or retardation , or is threatening to cause injury, the following additional factors are prescribed:
a) whether a causal relationship exists between the dumping or subsidizing of the goods and the injury, retardation or threat of injury, on the basis of the factors listed in subsections (1) and (2); and
b) whether any factors other than the dumping or subsidizing of the goods have caused injury or retardation or are threatening to cause injury, …
[7] These provisions set out a non-exhaustive list of factors which the Tribunal may consider in reaching its determination of whether dumped/subsidized goods have caused injury, retardation or threat of injury.
[8] The Tribunal, in its determination on the issue of price effects, concluded based on the evidence that U.S. imports did not cause price undercutting, price depression or price suppression.
[9] At paragraph 106 of its reasons, the Tribunal found:
On the basis of the above date and analysis, the Tribunal finds that selling prices of the subject goods, after accounting for the appreciation of the Canadian dollar, have not declined significantly and, thus, would not have had a significant negative influence on the selling prices of domestic grain corn. The Tribunal concludes that the decline in the selling prices of domestic grain corn is essentially attributable to the appreciation of the Canadian dollar and other factors unrelated to the subject goods. Therefore, the Tribunal finds that the subject goods have not significantly depressed or suppressed the price of domestic grain corn.
[10] The applicants argue that because the Tribunal recognized that the 44% margin was significant, the Regulations required the Tribunal to conclude that imports had caused material injury.
[11] The mandate of the Tribunal is to analyse the evidence to determine whether the subject goods have caused material injury to the domestic industry. One of the factors that the Tribunal may consider is the magnitude of the margin.
[12] The Tribunal concluded that, although the margins were significant, imports have not caused injury to the domestic industry.
[13] As stated by this Court in Canadian Pasta Manufacturers’ Assn. v. Aurora Importing & Distributing Ltd., [1997] F.C.J. No. 115; 208 N.R. 329 (C.A.) at paragraph 9:
As we have said on at least two previous occasions, the question of the causal relationship between dumping and injury in quintessentially one of fact. Indeed, if it were otherwise the Tribunal would have simply no role to play in cases such as this where both dumping and injury have been established; it would follow as a matter of law that the former caused the later.
[14] The applicants have not established that the Tribunal committed any error of law or made patently unreasonable finding with respect to the first two allegations.
[15] The third allegation made by the applicants is that the Tribunal breached the rules of natural justice by focusing on the widening price gap between American and Canadian corn when no one had raised that as an issue.
[16] The Tribunal is entitled, under its governing legislation and rules, to consider all information relevant to its inquiry.
[17] In this case, the Tribunal issued its Notice of Commencement of Inquiry on December 16, 2006, along with questionnaires to each of the applicants and other interested parties, including importers. On the basis of the information collected, the Tribunal prepared and circulated a Pre-Hearing Staff Report which included statistics documenting a price gap between American and Canadian corn prices and its movement over time.
[18] In its Public Brief, the Canadian Snack Food Association argued that: “table 16 of the Tribunal’s Staff Report shows that the price of imported U.S. corn is significantly higher than the price of Canadian corn and that gap widened considerably in the 2004-2005 season.
[19] The applicants had a full opportunity to review and respond to evidence throughout the proceeding, both in their questionnaire responses, written submissions, witness statements and oral testimony.
[20] In these circumstances, the applicants’ allegations of breach of natural justice are not sustainable.
[21] In this respect, the applicants also claim that the Tribunal’s analysis of the price gap between American and Canadian corn prices is patently unreasonable.
[22] However, the Tribunal’s analysis of the price gap was based on a factual determination within the Tribunal’s jurisdiction and expertise and the applicants have not shown that the finding is not rationally supported by any evidence.
[23] Accordingly, the application for judicial review will be dismissed.
[24] After hearing representations from the parties and having determined that there is no basis for not awarding costs against the applicants, an order of costs will follow on these terms:
1) The respondents who appeared at the hearing of the application for judicial review are entitled to costs under Column III and are limited to counsel fee for one counsel;
2) For the purpose of assessment and payment of costs, the applicants shall be treated as a single entity.
Chief Justice
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: A-267-06
STYLE OF CAUSE: ONTARIO CORN PRODUCERS’ ASSOCIATION, LA FÉDÉRATION DES PRODUCTEURS DE CULTURES
COMMERCIALES DU QUÉBEC, MANITOBA CORN
GROWERS ASSOCIATION
v.
CANADIAN PORK COUNCIL, ANIMAL NUTRITION
ASSOCIATION OF CANADA, CANADIAN
CATTLEMEN’S ASSOCIATION, BREWERS OF
CANADA, FOOD PROCESSORS OF CANADA,
SCHENLEY DISTILLERIES INC., ALBERTA
DISTILLERS LIMITED, MAPLE LEAF FOODS INC.,
ASSOCIATION OF CANADIAN DISTILLERS,
COMMERCIAL ALCOHOLS INC., NEWCO
COMMODITIES LIMITED, DIAGEO CANADA INC.,
WESTON FOODS INC., BRAR NATURAL MILLING
INCORPORATED, CASCO INC., CORN PRODUCTS
INTERNATIONAL INC., CANADIAN SNACK FOOD
ASSOCIATION, ARCHER DANIELS MIDLAND
COMPANY, PESPI-COLA CANADA LIMITED, HYTEK LIMITED, GREAT LAKES ORGANIC INC., U.S. CORN COALITION, TOWNSHIP OF EDWARDSBURGH CARDINAL, ANIMAL NUTRITION ASSOCIATION OF CANADA - MANITOBA DIVISION, ONTARIO AGRI-BUSINESS ASSOCIATION, ANIMAL NUTRITION ASSOCIATION OF CANADA – BRITISH COLUMBIA DIVISION, OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE, QUE PASA MEXICAN FOODS, BRADNER FARMS, BRANDY FARMS INC. & COZY PRAIRIE, MANITOBA PORK COUNCIL, SUNCOR ENERGY PRODUCTS INC., THE PEPSI BOTTLING GROUP (CANADA) CO., DEL COMAL FOODS LTD.
REASONS FOR JUDGMENT OF THE COURT BY: Richard C.J.
DELIVERED FROM THE BENCH BY: Richard C.J.
APPEARANCES:
|
Mr. Jonathan Hood |
FOR THE APPLICANTS |
|
Mr. Michael Flavell
Mr.Paul Lalonde Ms. Cynthia Amsterdam
Mr. Clifford Sosnow Mr. Brad Berg
Mr. Nicholas McHaffie Ms. Susan Hutton Mr. Craig Collins Williams
Mr. William Hourigan Mr. Mark Sills
Mr. Gordon LaFortune
Mr. Simon Potter Ms. Brenda Swick Mr. Orlando Silva
Mr. Martin Masse
Mr. Martin Sorensen |
FOR THE RESPONDENT ARCHER DANIEL MIDLANDS COMPANY
FOR THE RESPONDENTS SCHENLEY DISTILLERIES INC. AND ALBERTA DISTILLERS LIMITED
FOR THE RESPONDENTS CASCO INC. AND CORN PRODUCTS INTERNATIONAL INC.
FOR THE RESPONDENT UNITED STATES TRADE REPRESENTATIVE
FOR THE RESPONDENT MAPLE LEAF FOODS INC.
FOR THE RESPONDENT COMMERCIAL ALCOHOLS INC.
FOR THE RESPONDENTS CANADIAN PORK COUNCIL, ANIMAL NUTRITION ASSOCIATION OF CANADA AND CANADIAN CATTLEMEN’S ASSOCIATION
FOR THE RESPONDENTS DIAGEO CANADA INC., WESTON FOODS INC. AND PEPSI BOTTLING GROUP (CANADA) CO.
FOR THE RESPONDENT HYTEK LTD.
FOR THE RESPONDENT SUNCOR ENERGY PRODUCTS INC. |
SOLICITORS OF RECORD: