Canada Challenges U.S. Tariffs through WTO and Free Trade Agreements

Monday 03 February 2025 - 14:05

Canada is set to file a formal complaint with the World Trade Organization (WTO) against the tariffs recently imposed by the United States, while also seeking remedies under a regional free trade agreement, according to a Canadian government official.

The official, speaking anonymously, stated that Canada views these tariffs as violations of the U.S.’s existing trade commitments. The move follows the U.S. administration’s decision to apply a 25% tariff on most Canadian imports, excluding energy products, which face a separate 10% levy.

Canada plans to pursue legal actions under both WTO regulations and the U.S.-Mexico-Canada Agreement (CUSMA), signed in 2018. A scheduled review of this trade pact, previously described by Canadian officials as a “gold standard agreement,” is expected next year.

In response, Canada has announced its first round of countermeasures, targeting 1,256 American products with retaliatory tariffs totaling 30 billion Canadian dollars. The affected goods include cosmetics, household appliances, tires, tools, plastics, furniture, coffee, alcoholic beverages, dairy products, and fruits.

While the tariffs are not specifically aimed at states with strong Republican ties, officials acknowledged that they are designed to influence key lawmakers who could pressure the U.S. administration to reconsider its stance.

A potential second round of counter-tariffs is under consideration, which could raise the total value of targeted U.S. goods to 155 billion Canadian dollars (approximately 106 billion USD).

“Our goal is to encourage the United States to reconsider its approach and engage in constructive discussions,” the official noted. “However, if necessary, the Canadian government is prepared to explore additional measures.”