Regional Tariff Response Initiative in Southern Ontario: Funding to Help Businesses Respond to Tariff Impacts
Canadian businesses are navigating a changing trade environment. Tariffs, higher input costs, supply chain disruptions, and uncertainty in international markets are creating new challenges for companies across the country.
To help businesses adapt, the Government of Canada has launched the Regional Tariff Response Initiative (RTRI). Delivered through Canada’s regional development agencies, RTRI is part of the federal government’s broader response to ongoing trade pressures.
Across Canada, the initiative is providing $1.95 billion to help businesses strengthen their operations, improve productivity, reduce costs, build more resilient supply chains, and expand into new markets.
In Southern Ontario, RTRI is delivered by FedDev Ontario and provides support to both for-profit businesses and eligible not-for-profit organizations, although the eligibility requirements, funding structures, and eligible activities differ between the two.
What Is the Regional Tariff Response Initiative?
The Regional Tariff Response Initiative is designed to help Canadian businesses and organizations respond to the impacts of tariffs and broader trade disruptions.
Rather than simply helping businesses offset existing costs, the program is intended to support new projects that improve long-term competitiveness and resilience.
Projects may help businesses:
- Improve productivity and reduce costs
- Adopt new technology, automation, and digital solutions
- Strengthening domestic supply chains
- Diversify suppliers and markets
- Find new customers and reduce exposure to tariff-affected markets
- Develop strategic partnerships
- Expand business capacity
- Support research and development
- Bring highly qualified expertise and R&D activities to Southern Ontario
RTRI is available across all impacted sectors, with a portion of FedDev Ontario’s investments giving priority to projects supporting businesses in sectors such as steel, automotive, and food security.
RTRI Funding for For-Profit Businesses
Who Can Apply?
For-profit businesses applying through FedDev Ontario must meet a number of eligibility requirements.
Generally, an eligible business must:
- Be located and operated in Southern Ontario
- Have been incorporated and registered to do business in Canada or Ontario for at least three years
- Operate as a for-profit business
- Employ at least five full-time equivalent employees in Southern Ontario
- Employ fewer than 500 full-time equivalent employees overall
- Have been viable before the tariffs imposed by the U.S. and China and before March 21, 2025
The business must also demonstrate that it has been affected by tariffs or ongoing trade disruptions.
Demonstrating Tariff or Trade Impacts
A business may demonstrate eligibility by showing that at least 25% of its sales are in markets targeted by the tariffs.
Alternatively, a business may demonstrate that it has been directly affected by trade disruptions.
Evidence of direct impact could include:
- Increased costs for production materials
- Supply chain disruptions or longer lead times
- Increased costs for finished products
- New import or export taxes
- Revenue declines
- Loss of customers or contracts
- Reduced export volumes
- Loss of market access
- Layoffs or hiring freezes
- Other measurable evidence showing that tariffs or trade uncertainty have negatively affected the business
This distinction is important because a company does not necessarily need to have 25% of its sales in tariff-targeted markets if it can demonstrate another direct and measurable impact from trade disruptions.
How Much Can For-Profit Businesses Receive?
Eligible businesses can generally request:
$125,000 to $10 million in repayable funding, or
$125,000 to $1 million in non-repayable funding.
The level of support depends on the project, the applicant, and the type of funding requested.
Repayable Funding
For repayable funding, FedDev Ontario may contribute up to 75% of eligible project costs, while the applicant must contribute at least 25%.
Non-Repayable Funding
For non-repayable funding, FedDev Ontario may contribute up to 50% of eligible project costs, while the applicant must contribute at least 50%.
Matching contributions must come from eligible sources. In-kind contributions are not eligible as matching funds.
RTRI Funding for Not-for-Profit Organizations
RTRI also provides funding for eligible not-for-profit organizations in Southern Ontario whose primary focus is supporting small and medium-sized businesses and/or community economic development.
The not-for-profit stream is structured differently from the for-profit business stream.
Who Can Apply?
An eligible not-for-profit organization must:
- Be an incorporated not-for-profit organization located in Southern Ontario
- Have a primary focus on supporting businesses and/or community economic development
The organization must also support businesses that either:
- Have at least 25% of their sales in markets targeted by the tariffs, or
- Can demonstrate that they have been directly affected by tariffs or the uncertainty they have created
The impact can include increased production costs, supply chain disruptions, new import or export taxes, revenue declines, loss of market access, reduced export volumes, employment impacts, or other evidence of tariff-related disruption.
How Much Can Not-for-Profits Receive?
Eligible not-for-profit organizations can generally request $125,000 to $10 million in non-repayable funding.
To be considered for this funding, the organization must demonstrate that its proposed project will generate economic benefits for the local economy or region.
These benefits could include:
- Employment creation or maintenance
- Strengthening the regional economic base
- Creating additional value
- Supporting businesses within the regional value chain
- Expanding access to regional, national, or international markets
Unlike the for-profit business stream, the not-for-profit stream focuses on projects that provide services and broader economic benefits to businesses and the regional economy.
What Can RTRI Funding Support?
While the exact eligible activities differ depending on the applicant and project, RTRI is designed to support new initiatives that help businesses respond to trade disruption and become more competitive and resilient.
Technology and Automation
Funding may support digitization, automation, and the adoption or adaptation of technology to improve productivity and competitiveness.
Market Development and Diversification
Businesses and supporting organizations can undertake market development activities designed to identify new customers, expand into new markets, and reduce exposure to tariff-affected markets.
This may include market research, market diagnostics, market expansion activities, and participation in trade missions.
Supply Chain Resilience
RTRI can support initiatives that strengthen supply chains and improve the reliability of domestic markets.
Projects may involve:
- Developing strategic supplier relationships
- Optimizing supply chains
- Strengthening domestic sourcing
- Facilitating internal trade
- Building strategic partnerships
- Improving compliance with relevant standards
Research and Development
Funding can also support R&D mandates and access to highly qualified personnel or expertise in Southern Ontario.
This may include new activities as well as certain R&D activities previously conducted outside Canada that are being brought to Southern Ontario as a result of the initiative.
Business Support Services
For eligible not-for-profit organizations, projects may include providing services directly to businesses, such as business guidance, market intelligence, market development, and other forms of support that help companies respond to trade disruptions.
What Makes a Strong RTRI Project?
Meeting the eligibility requirements is only the beginning.
FedDev Ontario assesses applications based on the information provided by the applicant. A strong application should present a clear, evidence-based rationale for the project and demonstrate the connection between the company’s challenges, the proposed investment, and the expected results.
Whether you are a for profit or a not-for-profit organization, in both streams, the strength of the project and the quality of the application matter.
What Costs Are Eligible?
RTRI generally supports new costs that are essential to the project and directly related to eligible activities.
Certain eligible costs may be retroactive for up to 12 months before the receipt of a signed funding application but cannot be incurred earlier than March 21, 2025.
Applicants should carefully distinguish proposed project costs from existing operating expenses or projects already underway.
Costs that are unreasonable, non-incremental, or not directly related to eligible project activities may not qualify. Examples of potentially ineligible costs include land and building acquisition, entertainment expenses, motor vehicle costs, and refinancing existing debt.
Projects must be completed no later than March 31, 2028.
How to Apply
A successful RTRI application requires more than completing a funding form. Applicants need to demonstrate a clear business or economic need, establish the impact of trade disruptions, and present a realistic plan for how funding will address that challenge.
The application process generally involves:
1. Confirm Eligibility
Determine whether your organization meets the requirements for the for-profit business or not-for-profit organization stream.
2. Define the Project, Develop the Business Case & Prepare Supporting Documentation which is mandatory. Additional documentation for project rationale will strengthen the application.