Regional Tariff Response Initiative: Up to $10M for Businesses Impacted by U.S. and China Tariffs

The Regional Tariff Response Initiative (RTRI) is the federal government’s direct funding response to the ongoing U.S. and China trade disruptions. It’s designed to help Canadian businesses absorb tariff impacts, diversify markets, strengthen domestic supply chains, and invest in the operational changes needed to remain competitive under a new trade reality.

The program offers two distinct funding streams: repayable contributions up to $10 million and non-repayable contributions up to $1 million. Steel and automotive companies get priority for the non-repayable stream. Like the RDII, it’s delivered regionally through all six of Canada’s Regional Development Agencies.

Who can apply

Through FedDev Ontario, eligibility requires:

• For-profit business, incorporated and registered in Canada for at least 3 years
• Located and operating in southern Ontario (other regions served by their respective RDA)
• 5 to 499 full-time equivalent employees in southern Ontario
• Was viable prior to the tariffs imposed by the U.S. and China, and prior to March 21, 2025
• Can only submit one application to FedDev Ontario at a time across all open programs

In addition, your business must meet one of two tariff-impact thresholds:

1. Have at least 25% of your sales in the markets targeted by the tariffs, OR
2. Demonstrate that the business has been directly affected by ongoing trade disruptions, including U.S. and China tariffs or Canadian counter-measures

How to demonstrate tariff impact

If you’re relying on the second threshold, the program accepts several forms of evidence:

• Increased cost for production materials (supply chain disruption, alternative sourcing, changes to lead times)
• Increased retail cost of finished product
• Addition of an import or export tax
• Revenue decline or loss of market access (lost customers, reduced export volumes)
• Employment effects (layoffs, hiring freezes, uptake of Work-Sharing Program)
• Any other evidence demonstrating the business has been negatively impacted

The two funding streams

RTRI is unique in that it offers both repayable and non-repayable funding. You must choose one — you cannot apply for both on the same project.

Repayable stream

• Funding range: $125,000 to $10 million
• Cost sharing: FedDev covers up to 75% of eligible costs; applicant funds minimum 25%
• Repayment: Interest-free, unconditionally repayable. Terms determined at contribution agreement stage

Non-repayable stream

• Funding range: $125,000 to $1 million
• Cost sharing: FedDev covers up to 50% of eligible costs; applicant funds minimum 50%
• Key restriction: A business may only receive a non-repayable contribution from RTRI once during the initiative’s lifetime
• Eligibility for non-repayable: Your company must generate economic benefits for the local economy or region (employment, value creation, supply chain role)

Eligible activities

RTRI supports projects that help businesses boost productivity, enhance competitiveness, and reduce costs to mitigate tariff impacts. Projects must be executed between March 2025 and March 2028. Eligible activities include:

• Digitization and automation — acquiring or adapting technology to enhance productivity and competitiveness
• Market diversification — development, expansion, and joining trade missions to find new customers and reduce tariff exposure
• Supply chain optimization — building strategic partnerships, ensuring compliance with standards, enhancing global and domestic presence
• Domestic supply chain strengthening — facilitating internal trade and enhancing the resilience of domestic markets
• Business support and guidance — market development in all markets, sectoral advisory services
• Reshoring and onshoring — bringing production, R&D mandates, or highly qualified personnel to your region, including activities previously conducted outside Canada

Costs, timelines, and stacking

• Eligible costs: New costs essential to the project and directly related to eligible activities
• Retroactive costs: Up to 12 months before a signed application, but no earlier than March 21, 2025
• Ineligible costs: Land and building acquisition, entertainment, motor vehicles, refinancing of existing debts
• Project timeline: Start no earlier than March 21, 2025; complete by March 31, 2028
• In-kind contributions: Not eligible as matched funding
• Stacking: Total government assistance (federal, provincial, municipal) capped at 90% of eligible costs. 100% for projects led by Indigenous applicants

If you have an active application to the provincial Ontario Together Trade Fund or the Protect Ontario Financing Program as part of your matched funding, evidence of that application must be included.

Application process

Applications are accepted on a continuous basis until funding is fully allocated. There is no fixed deadline, but funding is finite.

1. Complete the online self-screening tool to confirm eligibility
2. Review the Application Guide for Businesses
3. Download and complete the Application for Funding plus the supplementary application form
4. Submit with all mandatory attachments (incorporation documents, IP strategy, financial statements, tariff impact evidence)

If approved, you sign a contribution agreement within 30 calendar days. Funding is reimbursed based on approved costs incurred. All project activities must be completed by March 31, 2028 to be eligible for reimbursement. Contact FedDev Ontario at 1-866-593-5505 with questions.

Part of a broader tariff relief suite

RTRI doesn’t exist in isolation. The federal government has deployed a coordinated set of tariff response programs:

• RTRI — regional project-based funding (this program)
• Workforce Alliances — supports for workforce adaptation
• Large Enterprise Tariff Loan Facility — for larger companies (500+ employees)
• BDC Pivot to Grow — Business Development Bank of Canada financing initiative
• Strategic Response Fund — for large-scale, strategically significant projects

RTRI is designed to work in coordination with these programs. If you’re above 500 employees, the Large Enterprise Tariff Loan Facility is likely more appropriate. If your project exceeds $10M and is strategically significant, the Strategic Response Fund may be a better fit.

Available across all regions

Like RDII, RTRI is delivered by all six Regional Development Agencies:

• FedDev Ontario — Southern Ontario
• PrairiesCan — Alberta, Saskatchewan, Manitoba
• PacifiCan — British Columbia
• ACOA — Atlantic provinces
• CED — Quebec
• FedNor — Northern Ontario
• CanNor — Yukon, Northwest Territories, Nunavut

Our take: who this program is for (and who it isn’t)

Good fit

• Manufacturers with significant U.S. export exposure. If 25%+ of your sales are in the U.S. and tariffs are compressing your margins, the repayable stream gives you up to $10M in interest-free capital to retool, automate, or diversify. Example: a custom metal fabricator in the GTA whose largest contracts are with U.S. automotive OEMs and is facing 25% tariffs on finished goods.
• Steel and automotive companies seeking non-repayable funding. These sectors get explicit priority. If you’re a steel processor, auto parts manufacturer, or EV component supplier, the $1M non-repayable stream was designed for you. Example: a Tier 2 auto parts supplier investing in automation to reduce per-unit cost and offset tariff-driven margin erosion.
• Companies looking to reshore production. If the tariff environment makes it economical to bring manufacturing, R&D, or sourcing back to Canada, RTRI explicitly funds onshoring activities. Example: a plastics manufacturer bringing injection moulding capacity from a U.S. facility to Ontario.
• Businesses diversifying away from U.S. market dependence. Trade missions, market diagnostics, and expansion into new geographies are all eligible. Example: a food processing company pivoting from U.S. retail chains to European and Asian distributors.

Not a good fit

• Companies with fewer than 5 or more than 499 FTEs. The employee threshold is strict. Under 5, you’re too small. Over 499, look at the Large Enterprise Tariff Loan Facility instead.
• Businesses that weren’t viable before the tariffs. RTRI is not a bailout program. You must demonstrate you were a going concern before March 21, 2025. If the tariffs tipped a company from struggling to insolvent, this program won’t help.
• Companies that can’t demonstrate tariff impact. If neither the 25% sales threshold nor direct impact evidence applies to your business, you won’t qualify. General economic slowdown isn’t enough — the impact must be traceable to U.S. or China tariffs or Canadian counter-measures.
• Companies looking for working capital. This is project-based reimbursement funding. You incur costs first, then claim. If cash flow is the immediate problem, BDC’s Pivot to Grow or your bank’s operating line are faster paths.

How this fits into a broader funding strategy

RTRI can be layered with other programs up to the 90% stacking limit. A tariff-impacted manufacturer could combine RTRI (for equipment and market diversification) with SR&ED tax credits (on eligible R&D work), IRAP (for technology development components), and provincial programs like Ontario’s Together Trade Fund. The key is ensuring cost categories don’t overlap and the 90% stacking ceiling is respected.

If your business has been hit by tariffs and you’re planning capital investments, market diversification, or operational changes to adapt, we can help you assess what you qualify for and build the application.