The Ontario government is pushing back against New York State's Buy American law by limiting public sector procurement with suppliers in that state.
A new regulation that took effect Sunday restricts government contracts with New York State suppliers, specifically when it comes to the use of structural iron.
In a statement Monday, Ontario Premier Kathleen Wynne said the move is a response to legislation that took effect in New York State this weekend requiring the use of American-made iron in certain government road and bridge construction projects.
Wynne said Ontario's regulation is meant to level the playing field, and will immediately be repealed if New York State abandons its Buy American restrictions.
"I have consistently supported open and competitive procurement because it helps create good jobs on both sides of the border, but it has to be a two-way street," she said.
"When Ontario workers and businesses are threatened by protectionist U.S. actions I have no choice but to respond."
Last month, Ontario legislators passed a law allowing the province to retaliate against any state that adopts Buy American provisions, calling it a necessary protection for the province's workers and businesses.
The opposition parties have panned the move as a reckless and desperate attempt to shore up votes ahead of the spring election.
"Kathleen Wynne and the Liberals can't be trusted. They will do, say, or promise anything to cling to power," Progressive Conservative finance critic Vic Fedeli said in a statement on Monday.
"No amount of grandstanding is going to be able to distract from their disastrous record over the last 15 years."
The Ontario government is monitoring other U.S. jurisdictions where Buy American policies are in place or on the horizon, Wynne said.
The province has not yet created a regulation to counter Buy American legislation in Texas because it believes the rules there do not apply to Canada, she noted. However, that position will be put up for review, she said.
More than $1 billion in goods are traded between Ontario and the U.S. each day, according to the province.
The state of New York exported almost US$11 billion in goods to Ontario in 2016, it has said. The province is ranked the first or second export destination for 28 states, the government said.