With Labour Day now behind us, Parliament Hill is gearing up for its September 21 return. Canada’s counter-tariffs on nearly $28 billion in American goods are now in force, and the United States has already escalated in response: President Trump has signed measures to ban certain Canadian alcohol, dairy-related products, molasses, non-alcoholic beer, motorcycles and mopeds from entering the U.S. market as of September 29, while modifying the list of Canadian goods subject to 50% tariffs effective September 15 and directing action to remove Canadian-origin products from U.S. government procurement schedules.
Meanwhile, the federal Cabinet retreats to Banff on Thursday for its fall “Cabinet Planning Forum,” and the first-ever Canada Investment Summit opens in Toronto next Monday with an exclusive guest list arriving to pursue specific Canadian investment opportunities. A quick but consequential European trip by the Prime Minister and the return of the House of Commons follow, fresh off three commanding Liberal by-election wins last week, with six more contests on the horizon. All of this against a trade file where the two governments are speaking, despite the Truth Social posts and memes against Canada, but not currently negotiating.
In this Canada – Trump Administration 2.0 Update, Alex Steinhouse of the Fasken Government Relations and Political Law team provides insights on the state of Canada-US relations and on the fall federal political calendar now underway.
Canada’s Counter-Tariffs Take Effect
At 12:01 a.m. on the morning of Tuesday, September 8, 2026, Canada’s counter-tariffs on approximately $27.6 billion of US imports came into force. The countermeasures are calibrated as a dollar-for-dollar mirror of the tariffs imposed by the US on $27.6 billion of Canadian goods effective August 22 under Section 338 of the Tariff Act of 1930 — an obscure Depression-era provision that appears not to have been used previously to impose tariffs, though it was reportedly last considered in the late 1940s against newly Communist China.
The Canadian measures apply at rates of 15%, 25% and 50% across more than 700 tariff classifications. Finance Canada has identified the affected sectors as including steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics; the tariff-item list also captures goods such as aluminum products, plastics, apparel, cosmetics, and other consumer products. The full list of goods subject to surtax is available here.
The list itself carries a deliberate political design. Alongside the US equivalents of Canadian goods shut out of the American market, it in part targets US exports from some politically important states with a view to exerting pressure on the administration in advance of the November midterm elections; to that end, approximately 12 percent of the total targeted imports come from Ohio, where the Senate seat is considered in play. As Industry Minister Mélanie Joly put it when the list was announced: “We are targeting products that will target states in the US. We’re being wise and strategic to put political pressure, and that’s why we think it’s the right thing to do right now.”
The episode also illustrates how advocacy can quickly shape and evolve the scope of the government’s counter-tariff targets. Fish and seafood products worth about $1 billion were included in the initial Canadian package, with many items subject to a 25% rate, but were quickly removed from the counter-tariff list within days after feedback from the sector and concerns about broader economic harm to integrated cross-border supply chains, including Atlantic Canadian processors and the lobster industry.
Hours after the Canadian retaliatory tariffs took effect, Prime Minister Carney released a national address to Canadians, warning that the pivot away from the US will “come at a cost,” but “it doesn’t come close to the cost of standing still.” Prime Minister Carney referenced the policies his government has put forward to make Canada stronger and more resilient so that “no country can ever hold us hostage, and that we can live how we want to live.” The framing is deliberate. The government appears to be no longer preparing the country for an imminent settlement; it is preparing it for a more prolonged dispute.
The American response has now moved beyond threatened retaliation. In measures announced late on September 8, the White House said it would use Section 338 to prohibit imports of selected Canadian alcohol and dairy-related products, as well as molasses, non-alcoholic beer, motorcycles and mopeds, effective September 29. It also announced that certain Canadian goods would be added to, and others removed from, the 50% tariff list as of September 15, with rock salt and cement among the removals and all-terrain vehicles, additional dairy products and other goods among the additions. The White House also stated that these Section 338 tariffs apply regardless of whether goods originate under the CUSMA, and in addition to Section 232 tariffs.
Similar to the imposition of previous counter-tariffs, Canada’s tariff remission framework remains available to assess requests for exceptional relief from impacted businesses experiencing significant harm.
Moreover, Ottawa has also paired the countermeasures with an additional $7.5 billion support package for businesses and workers affected by the American duties, announced by Finance Minister François-Philippe Champagne alongside the counter-tariff list on August 25, including loan and grant programs, and facilitated access to Employment Insurance for affected workers.
For a fuller treatment of key Canadian business considerations with respect to the tariffs, please consult our International Trade and Investment Law Bulletin, “Canada’s New Retaliatory Tariffs on US Goods: What Canadian Businesses Need to Know.”
Talking, But Not Negotiating
Minister of Canada-US Trade Dominic LeBlanc confirmed a call on September 8, 2026, with US Trade Representative Jamieson Greer, with a further meeting expected later this week. But the space for formal negotiation appears to have narrowed (September 8) further. Within hours of Canada’s counter-tariffs taking effect, the White House announced the import bans, tariff-list changes and procurement-related measures against Canada, while US officials framed the escalation as a response to what they call Canada’s “continued discriminatory treatment” of American exports. (September 8)
Minister LeBlanc’s office has been careful in terms of expectations setting. His press secretary, Gabriel Brunet, confirmed that Canadian and American officials have maintained ongoing discussions on a range of issues, “although formal trade negotiations are not taking place at this stage.” There were, however, several informal exchanges between the two men over the weekend. On the most recent American escalation, Minister Leblanc has stated that Canada is assessing these new measures before responding further.
The public rhetoric has not helped. Prime Minister Carney has urged Washington to “stop doing memes, stop throwing shade, stop trying to be tough” and return to serious trade discussions, but so far little has changed in that regard. Over the weekend, President Trump posted a hockey-themed meme aimed at Prime Minister Carney, telling him to “Get up, Governor” and then later demanded that Americans stop buying from Bombardier — “NO MORE SELLING BOMBARDIER IN THE UNITED STATES!” — while threatening to bar the Canadian manufacturer’s aircraft from the American market. It is a reminder that firm-specific, sector-specific and now procurement-specific interventions remain live risks, independent of the published tariff schedules, and that clients with significant US exposure should be planning for targeted market-access restrictions — not only price effects from tariffs.
Cabinet Heads to Banff
The Prime Minister announced Monday (September 7) that the Cabinet will hold its fall “Cabinet Planning Forum” (formerly known as a Cabinet Retreat) in Banff, Alberta, on September 10 and 11, framed around building “with greater speed and ambition.” In advance of the retreat, federal cabinet ministers have been asked to report directly to the Prime Minister on the progress they have made in their files, including “key performance indicators” and in respect of the Prime Minister’s mandate letter to cabinet. This has fueled further speculation about a Cabinet shuffle, which has long been expected by Parliament Hill observers given previous Cabinet resignations and the performance of certain Ministers.
The choice of venue for a meeting of this importance is never accidental. Holding the fall planning session in Alberta, on the eve of its referendum, and of an investment summit built around energy, critical minerals and infrastructure, sends a clear message to Alberta, the West, and to capital markets at the same time — and hedges against a fall dominated by tariff defence and Canadian unity, rather than nation-building offence.
The Canada Investment Summit, September 14-15
The following week, the Four Seasons in downtown Toronto hosts the first-ever Canada Investment Summit, co-hosted by the Prime Minster with CPP Investments and PSP Investments. The objective is the government’s stated goal of catalyzing $1 trillion in total investment in Canada over five years, and the summit will involve pitching major Canadian projects for potential foreign investment.
As CTV News reports, the senior principals from more than 100 institutional investors are expected, drawn from at least 11 countries and collectively responsible for allocating more than $100 trillion in capital. Notably, and at a time when relations are at their most strained, the largest single contingent is American — 33 investment firms — followed by 28 Canadian, nine from the United Kingdom, eight from France and seven from Australia, with participation from the United Arab Emirates, China, Malaysia, Norway, Singapore, and Saudi Arabia. Four state-owned funds from the UAE will attend, a year after Emirati sovereign wealth funds committed $70 billion to Canadian critical minerals, energy, ports, and artificial intelligence during the Prime Minister’s November 2025 visit. So will Norges Bank Investment Management, which runs the world’s largest sovereign wealth fund.
The Prime Minister will deliver the keynote address, and the 13 provincial and territorial Premiers are expected to play central roles. Five federal Ministers — Foreign Affairs Minister Anita Anand, Canada-US Trade Minister Dominic LeBlanc, Finance Minister François-Philippe Champagne, Industry Minister Mélanie Joly and International Trade Minister Maninder Sidhu — will host investment sessions on themes including delivering on Canada’s nation-building agenda and partnering with Canada’s pension plans. Former Prime Minister Stephen Harper is also expected to deliver remarks at the summit.
The substance, however, will not be in the main ballroom. The provinces and territories have submitted project lists, which the Prime Minister’s Office is said to be curating into a final “deal book,” and the pitches will be made in closed breakout rooms attended only by the Prime Minister, select Ministers, the relevant Premier, and the principal of each investor group — in most cases without the company executives in the room. The projects on offer span hydroelectricity, oil and gas, critical minerals, ports and data centres.
CTV reports that the development of the Port of Churchill in northern Manitoba is in the deal book, with Premier Wab Kinew expected to make the pitch, and that the Churchill Falls and Gull Island hydroelectric plan in Labrador— described by the Prime Minister as the largest clean energy investment in North America, with potential generation of up to 14,000 megawatts and a value in excess of $50 billion — is said to be likely opened to foreign investment. One source characterized the mood of the investors bluntly: they “do not want to hear speeches,” they want to be told “what [they] can buy.”
EU Diplomatic Overtures, the House returns and Six More By-Elections
Prime Minister Carney will attend the State of the European Union address in Strasbourg, France on September 16, where it is expected that EU Commission President Ursula von der Leyen will announce plans of a far-reaching alliance to strengthen EU-Canada partnership, which would touch on trade, defence, critical minerals and other strategic areas. The following day, Prime Minister Carney will deliver his own address to the European Parliament, all in an attempt to forger greater relations with the EU and its member states. The Government’s national caucus will also convene before the House of Commons returns on Monday, September 21.
Expect the fall sitting to open on the tariffs, the support package and the major projects agenda, with the Conservatives pressing for more details on the negotiations with the Americans and the economic cost of the dispute, and the Bloc Québécois on Quebec-specific exposure — the latter with one eye on the provincial general election of October 5.
The Government arrives to the fall sitting in a strong parliamentary position. Buoyed by strong national polling, on August 31, the Liberals swept all three by-elections, each with an absolute majority of the vote: holding Beaches–East York and North Vancouver–Capilano, and gaining Chicoutimi–Le Fjord. The standings now sit at 173 Liberals, 138 Conservatives, 21 Bloc Québécois, five New Democrats, and one Green.
That seat cushion matters to the Liberal majority government, because the political map is about to move again. Five seats currently stand vacant — Rosemont–La Petite-Patrie, Laurier–Sainte-Marie, Saint-Hyacinthe–Bagot–Acton, Scarborough North and Yorkton–Melville — and Conservative MP Larry Brock has announced his resignation in Brantford–Brant South-Six Nations effective September 18, three days before the House reconvenes. That makes six by-elections to come. Under federal election law, the earliest permissible polling dates for the current vacancies fall in October, with the latest dates to announce running into February 2027. The Prime Minister has previously indicated that the contests are unlikely to be held simultaneously and has pointed to the October 5 Quebec provincial election as a scheduling consideration — a relevant factor given that three of the six pending contests are in Quebec.
The political read is straightforward. With a working majority secured and no obligation to move quickly, the Government has unusual latitude to sequence these contests around the trade file and the Quebec campaign, and potentially flip further seats from the opposition.
For more information or to discuss how these developments affect your business, please contact any member of the Fasken Government Relations and Political Law team.
