Imposing Additional Duties To Offset Canadian Discrimination Against the Commerce of the United States With Respect to Alcoholic Beverages

( printed page 46639) Proclamation 11046 of July 20, 2026 Imposing Additional Duties To Offset Canadian Discrimination Against the Commerce of the United States With Respect to Alcoholic Beverages A Proclamation 1. Section 338 of the Tariff Act of 1930 ( 19 U.S.C. 1338 ) (section 338) empowers the President to, among other things, impose duties on imports of a foreign country to offset the burden or disadvantage from a foreign country's discrimination against or unequal imposition on the commerce of the United States. 2. Canada, through discrimination or an unreasonable and unequal imposition, burdens U.S. commerce but not the commerce of other countries and disadvantages U.S. commerce compared to the commerce of other countries. Specifically, Canada unreasonably burdens and disadvantages U.S. alcoholic beverages but not alcoholic beverages of other countries. 3. The provinces and territories of Canada generally regulate the distribution and sale of distilled spirits, wine, beer, and other alcoholic beverages (collectively, alcoholic beverages) in their respective jurisdictions. All provinces and territories control the wholesale of alcoholic beverages, and most have a hybrid public/private system for the retail of alcoholic beverages. 4. Beginning in March 2025, all Canadian provinces and territories halted the purchase, distribution, or retailing of U.S. alcoholic beverages. For example, on March 4, 2025, the Liquor Control Board of Ontario (LCBO) ceased purchasing all U.S. products and canceled existing orders where contractually possible; removed all U.S. products from wholesale product catalogues and retail eCommerce sites; and removed all U.S. products from LCBO retail stores and outlets. Similarly, on March 4, 2025, the province of Quebec asked the Société des Alcools du Québec to remove all U.S. products from its shelves and to stop supplying U.S. alcoholic beverages to grocery stores, liquor stores, bars, and restaurants. Only the provinces of Alberta and Saskatchewan subsequently lifted their bans on the purchase, distribution, or retailing of U.S. alcoholic beverages, in June 2025. 5. The United States, U.S. businesses and workers, and U.S. commerce suffer from the Canadian provinces' and territories' unreasonable and unequal impositions and discriminations with respect to U.S. alcoholic beverages. Following the implementation of the bans, U.S. exports of alcoholic beverages to Canada fell precipitously. Comparing the period from March 2025 through February 2026 to the same period in 2024-2025, Canadian imports of U.S. alcoholic beverages decreased by approximately 81 percent (from approximately $718 million to approximately $137 million). 6. The Canadian provinces and territories have not instituted or maintained similar bans or restrictions on any other country since March 2025, thereby benefitting other countries at the expense of the United States. Indeed, exports of alcoholic beverages from other countries to Canada have increased to meet the demand previously filled by U.S. exports. For example, comparing March 2025 through February 2026 to the same period in 2024-2025, Canadian imports of alcoholic beverages from Chile, Japan, Argentina, Ireland, New Zealand, and Australia significantly increased, with increases ranging ( printed page 46640) from approximately 13 percent to approximately 26 percent. Despite a nearly 12 percent decline in total imports of alcoholic beverages into Canada, imports into Canada from countries other than the United States increased by over $170 million from March 2025 through February 2026 compared to the same period in 2024-2025, with imports into Canada from the European Union accounting for over $100 million of this increase. 7. Accordingly, pursuant to section 338, I find as a fact that through the regulation, restriction, or prohibition of U.S. alcoholic beverages, Canada has imposed an unreasonable regulation or limitation on articles wholly or in part the growth or products of the United States and is discriminating in fact against the commerce of the United States in such manner as to place it at a disadvantage compared to the commerce of other countries, by banning the purchase, distribution, or retailing of U.S. alcoholic beverages while not banning or similarly restricting such products from other countries. I also find as a fact that this unequal and unreasonable imposition or discrimination places a burden on the commerce of the United States and places a disadvantage on the commerce of the United States. 8. Further, I find that imposing additional ad valorem duties on certain products of Canada to address the burden or disadvantage from this discrimination or unequal and unreasonable imposition is in the public interest, will serve the public interest, and is consistent with the interests of the United States. When U.S. producers are unfairly denied export opportunities, as they are in Canada due to Canadian provinces' and territories' bans on the purchase, distribution, or retailing of U.S. alcoholic beverages, they lose sales that support production in the United States, among other harms to the U.S. alcoholic beverage industry. The unreasonable, unequal, and discriminatory actions by Canada suppress U.S. manufacturing and agricultural output, as well as investment, undermining employment and economic vitality in American communities. Imposing additional duties on certain products of Canada will, among other things, expand opportunities for U.S. producers to compete within the U.S. market, revitalizing U.S. production and bringing attendant economic and societal benefits, and may spur Canada to remove the unreasonable and unequal imposition on and discrimination against commerce in U.S. alcoholic beverages. 9. Accordingly, I find that it is necessary and appropriate and in the public interest to impose an additional ad valorem duty of 50 percent on certain products of Canada, as identified in Annex II to this proclamation, effective as of 12:01 a.m. eastern time on August 19, 2026. I determine that the additional ad valorem duties imposed in this proclamation, as described below, will offset the burden or disadvantage on U.S. commerce from Canada's discrimination or unequal and unreasonable imposition. In my judgment, the action in this proclamation is consistent with the public interest, will serve the public interest, and is consistent with the interests of the United States. 10. Section 338 authorizes the President, if he determines it will serve the public interest, to offset any burden or disadvantage placed on the commerce of the United States by an unequal imposition or discrimination by a foreign country by specifying and declaring additional duties not to exceed 50 percent ad valorem (or its equivalent) and not to take effect earlier than 30 days after the President's proclamation finding that a foreign country imposes an unreasonable charge, exaction, regulation, or limitation that is not equally enforced on the like articles of every foreign country, or discriminates in fact against U.S. commerce in a way that places the commerce of the United States at a disadvantage compared to the commerce of any foreign country. Section 338 also authorizes the President to suspend, revoke, supplement, or amend any proclamation under section 338 whenever the President deems that the public interests require such action. Further, section 338 authorizes the President to exclude articles of the foreign country if the foreign country maintains or increases the discrimination against the ( printed page 46641) commerce of the United States and the President deems the exclusion to be consistent with the public interests and the interests of the United States. 11. Section 604 of the Trade Act of 1974, as amended ( 19 U.S.C. 2483 ) (section 604), authorizes the President to embody in the Harmonized Tariff Schedule of the United States (HTSUS) the substance of statutes affecting import treatment, and actions thereunder, including the removal, modification, continuance, or imposition of any rate of duty or other import restriction. NOW, THEREFORE, I, DONALD J. TRUMP, President of the United States of America, by the authority vested in me by the Constitution and the laws of the United States, including section 338; section 301 of title 3, United States Code ; and section 604, do hereby proclaim as follows: (1) Except as otherwise provided in this proclamation, certain products of Canada, as set forth in Annex II to this proclamation, imported into the United States shall be subject to an additional ad valorem duty of 50 percent, effective for goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern time on August 19, 2026. (2) Except as otherwise provided in this proclamation and in Annex I to this proclamation, the duties imposed in this proclamation are in addition to any other duties, taxes, fees, exactions, and charges applicable to such products. The duties imposed in this proclamation shall not apply to articles subject to duties pursuant to section 232 of the Trade Expansion Act of 1962, as amended ( 19 U.S.C. 1862 ), or articles, excluding unmanned aircraft, subject to the World Trade Organization Agreement on Trade in Civil Aircraft. (3) The HTSUS is modified as provided in Annex II to this proclamation, effective with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern time on August 19, 2026, and the modifications shall continue in effect, unless this action is expressly reduced, modified, or terminated. (4) Any product subject to the duties imposed in this proclamation, except those eligible for admission under “domestic status” as described in 19 CFR 146.43 , that is subject to the duties imposed in this proclamation and that is admitted into a United States foreign trade zone on or after the effective date of this proclamation must be admitted as “privileged foreign status” as described in 19 CFR 146.41 , and will be subject upon entry for consumption to any ad valorem rate of duty related to the classification under the applicable HTSUS subheading. (5) The head of each executive department and agency (agency) is authorized to and shall take all appropriate measures within the agency's authority to implement this proclamation. The head of each agency may, consistent with applicable law, including section 301 of title 3, United States Code , redelegate the authority to take such appropriate measures within the agency. (6) The Commissioner of U.S. Customs and Border Protection (CBP), in consultation with the Secretary of the Treasury, the Secretary of Commerce, and the United States Trade Representative, is authorized to issue such rules, regulations, guidance, instructions, or determinations as may be necessary to implement this proclamation and is authorized to take any necessary measures to administer the duties imposed in this proclamation. (7) The Commissioner of CBP, in consultation with the Secretary of the Treasury, the Secretary of Commerce, the United States Trade Representative, the Chairman of the United States International Trade Commission, and any other senior official he deems appropriate, shall determine whether any additional modifications to the HTSUS are necessary to effectuate this proclamation and shall make such modifications to the HTSUS through notice in the Federal Register , including any technical correction to the annexes to this proclamation. ( printed page 46642) (8) For any rule or regulation the Commissioner of CBP makes to implement this proclamation, the Commissioner of CBP shall, to the extent required by law, obtain the approval of the President or the United States Trade Representative. The United States Trade Representative is delegated the President's approval authority in 19 U.S.C. 1338(h) . (9) Any provision of previous proclamations and Executive Orders that is inconsistent with this proclamation is superseded to the extent of such inconsistency. If any provision of this proclamation or the application of any provision to any individual or circumstance is held to be invalid, the remainder of this proclamation and the application of its provisions to any other individuals or circumstances shall not be affected. IN WITNESS WHEREOF, I have hereunto set my hand this twentieth day of July, in the year of our Lord two thousand twenty-six, and of the Independence of the United States of America the two hundred and fifty-first. ( printed page 46643) ( printed page 46644) ( printed page 46645) ( printed page 46646) ( printed page 46647) ( printed page 46648) ( printed page 46649) ( printed page 46650) ( printed page 46651) ( printed page 46652) Billing code 3395-F4-P [ FR Doc. 2026-14991 Filed 7-22-26; 11:15 am] Billing code 7020-02-C