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WTO rules for US in Canada softwood lumber dispute

[JURIST] The World Trade Organization (WTO) [official website; JURIST news archive] has held that the US adhered to international trade rules in setting softwood lumber tariffs against Canada [JURIST news archive]. A WTO panel publicly released a report [PDF text] Monday that was originally disclosed to the parties in February. Canada had claimed that the US had violated the WTO's Anti-Dumping Agreement [WTO summary], which allows a member country to impose a tariff on another member found to have harmfully "dumped" an imported product in their market, by failing to calculate rates based upon a previous WTO Dispute Settlement Body [official website] opinion. The US argued that the Canadian government, which owns 90% of the country's timberlands and charges an administratively set "stumpage fee" to harvest the trees, unfairly subsidizes the industry. The majority of timber harvested in the US comes from private lands at market-driven prices.

The softwood lumber dispute [CBC backgrounder] between the two countries has festered for decades, with both a NAFTA panel [JURIST report] and the WTO previously ruling in Canada's favor. The US and Canada are the world's largest trading partners, with one-third of the US market for softwood supplied by Canada. The ongoing dispute has raised doubt as to the sustainability of the North American Free Trade Agreement. AP has more.

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