Docket: A-64-13
Citation: 2014 FCA 118
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CORAM:
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NOËL J.A.
WEBB J.A.
SCOTT J.A.
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BETWEEN:
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MARMEN-ÉNERGIE INC. and
MARMEN INC.
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Appellants
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and
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THE PRESIDENT OF THE CANADA BORDER SERVICES AGENCY
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Respondent
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Heard at Ottawa, Ontario, on May 7, 2014.
Judgment delivered from the Bench at Ottawa, Ontario, on May 7,
2014.
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REASONS FOR JUDGMENT OF THE COURT BY:
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NOËL
J.A.
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Docket: A-64-13
Citation:
2014 FCA 118
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CORAM:
|
NOËL J.A.
WEBB J.A.
SCOTT J.A.
|
|
|
|
BETWEEN:
|
|
MARMEN-ÉNERGIE INC. and
MARMEN INC.
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Appellants
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and
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THE PRESIDENT OF THE CANADA BORDER SERVICES AGENCY
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Respondent
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REASONS FOR JUDGMENT OF THE COURT
(Delivered from the Bench at Ottawa, Ontario, on May
7, 2014).
NOËL J.A.
[1]
The issue in this appeal brought pursuant to
section 68 of the Customs Act, R.S.C., 1985, c. 1 (2nd Supp.)
is whether goods used by Marmen Énergie Inc. and Marmen Inc. (the appellants)
in the manufacture of towers for wind turbines (the goods in issue) can be
classified under tariff item No. 9903.00.00 of the schedule to the Customs
Tariff, S.C. 1997, c. 36 as “[a]rticles and materials that enter into the
cost of manufacture or repair of”, or “[a]rticles for use in”, windmills, and
thereby benefit from duty-free treatment pursuant to this classification.
[2]
It has long been established that decisions of
the Canadian International Trade Tribunal (the CITT) relating to tariff
classification and the construction of tariff items stand to be reviewed on a
standard of reasonableness (Jam Industries Ltd. v. Canada (Border Services Agency), 2007 FCA 210 at para. 16; Mon-Tex Mills Ltd. v. Canada
(Commissioner of the Customs and Revenue Agency), 2004 FCA 346 at para. 2; Conair
Consumer Products Inc. v. Canada (Canada Customs and Revenue Agency), 2004
FCA 282 at para. 3; Star Choice Television Network Inc. v. Canada
(Commissioner of Customs and Revenue), 2004 FCA 153 at para. 7).
[3]
The source of the disagreement as to the proper
classification of the goods in issue is the introduction of the word
“éoliennes” in the French text of tariff item No. 9903.00.00 in 1987 (S.C. 1987
c. 49). Prior to that amendment the operative words were “moulins à vent”. The
corresponding word in the English text remained “windmills” throughout.
[4]
After conducting a contextual analysis the CITT
concluded that all host goods listed in tariff item No. 9903.00.00 must have a
connection to farming, agriculture, horticulture or agri-business and that the
goods in issue do not qualify as they have no such connection (reasons at
paras. 93 to 100). Having so decided the CITT proceeded to dismiss the appeals
brought by the appellants.
[5]
As the appellants have demonstrated, it cannot
be concluded with any certainty that tariff item No. 9903.00.00 requires that
all the host goods have a farming, agricultural, horticultural or agri-business
connection. Indeed, an addition to the classified goods in tariff item No.
9903.00.00 introduced in 2000 – “machinery for filling bottles for use in the
beverage industry” – indicates on the face of it that all listed goods
need not be connected to farming, agriculture, horticulture or agri-business.
The CITT in its elaborate reasons does not deal with this description.
[6]
In the absence of some explanation, a decision
that is based on the premise that all host goods have a farm related use restriction
in circumstances where the aforesaid description does not, cannot stand the
test of reasonableness.
[7]
The appeal will accordingly be allowed, the
judgment of the CITT will be set aside and the matter will be referred back to
the Tribunal for adjudication based on an analysis which takes into account the
addition of “machinery for filling bottles for use in the beverage industry” in
tariff item No. 9903.00.00.
[8]
The appellants shall have their costs.
“Marc Noël”
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