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George Reid in National Post on CUSMA and Oil Export Tariffs

June 21, 2019

George Reid comments in the National Post on the elimination of tariffs on Canadian heavy oil containing diluent in the Canada-United States-Mexico Agreement (CUSMA).

CUSMA includes a rule of origin amendment to allow up to 40 per cent of non-originating diluent in pipelines for transportation of crude oil without affecting the status of the oil as a product eligible for duty free treatment. This has been a longstanding Canadian industry request. This technical issue has resulted in upwards of $60 million a year in duties and other fees on Canadian crude exports to the U.S.

“This is a modernization of the agreement,” said George Reid, a trade and investment lawyer at Bennett Jones LLP in Toronto, adding the scrutiny on diluents added a tariff cost to Canadian exports as well as a “compliance cost” since companies spend millions proving their diluent originated in Canada. Reid is confident the new rules are a win for oil companies.

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  • George W. H. Reid George W. H. Reid, Partner

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