The Canadian International Trade Tribunal has completed a global safeguard inquiry into the importation of bicycles and finished, painted bicycle frames. The Tribunal’s decision supported an earlier claim made by the Canadian Bicycle Manufacturers Association and The Tribunal determined that increased imports of bicycles were “a principal cause of serious injury” to domestic bicycle manufacturers.

More than 50 parties participated in the hearings, including domestic and foreign producers, importers, mass merchants, independent bicycle dealers, domestic and foreign trade associations, a union and the governments of several countries. After hearing testimony and conducting its own research, The Tribunal found that from 2000 to 2004, total imports of bicycles increased almost 98%. Two significant surges in imports occurred, one in 2001 and the other in 2003. The imports of frames increased 133% over the same period and while imports increased, domestic production of finished painted bicycle frames declined dramatically.

In order to rectify the situation, the Tribunal recommended a surtax of 30% in the first year, 25% in the second, and 20% in the third year. The surtax will be applied to bicycles with a wheel diameter greater than 15 inches with an FOB value of CN$225 or less, roughly equivalent to CN$400 retail. The surtax exempts imports from Canada’s “Free Trade” partners and developing countries as set forth by the World Trade Organization.