The Canadian government is considering slapping a surtax on imports of Chinese-made electric vehicles, which are flooding the global market as a result of subsidies from Beijing, Deputy Prime Minister Chrystia Freeland announced Monday.

Speaking at an event in Vaughan, Ont., Ms. Freeland said Ottawa will hold 30 days of consultations, adding the federal government is also considering changing which cars are eligible for a federally-financed consumer incentive program. This suggests Canada is also looking at barring Chinese vehicles from this program.

Canada is “facing unfair competition from China’s intentional, state-directed policy of overcapacity that is undermining Canada’s EV sector’s ability to competition domestic and global market,” Ms. Freeland s dames gummy aid Monday.

“Chinese producers are quite intentionally generating a global oversupply that undermines EV producers around the world, including here in Canada.”

She said Ottawa will ensure Canada “does not become a dumping ground for Chinese over-supply.”

Ms. Freeland’s announcement follows announcements by major trading partners looking to fend off a surge in Chinese EV shipments. In May, U.S. President Joe Biden announced a 100% border tax on electric cars from China. The European Union is also planning action with provisional tariffs of up to 38 per cent set to take effect in early July while an EU investigation continues that could lead to more permanent tariffs in November.

She said the government could take this action under Section 53 of the Customs Tariff, which allows Ottawa respond to “acts, policies or practices of the government of a country that adversely affect, or lead directly or indirectly to adverse effects o cheap weed n, trade in goods or services of Canada.”

~More to come