The United States must rework duties on $4.6 billion a year in Canadian lumber imports because the tariffs were incorrectly computed, a North American Free Trade Agreement panel said Monday, for the second time.
Commerce Department officials used inappropriate benchmarks to make their case that Canadian pine, spruce and fir boards undercut U.S. lumber because of government subsidies, the five-member panel ruled in a decision released in Washington.
The ruling concerns a 19 percent tax on Canadian lumber set to punish alleged subsidies by Canada's provinces, which regulate most of the country's forests. It marks the second time that the panel, convened under the trade agreement, has rejected a U.S. attempt to justify the duty.
''If today's decision is implemented faithfully by [the] Commerce [Department], those rates should go to zero,'' John Allan, president of the British Columbia Trade Council, said in a conference call from Vancouver. ''The panel has rejected every argument the U.S. has made.''
Sawmills like Canfor Corp., represented by Allan's group, and Abitibi-Consolidated have deposited about $2 billion with the U.S. Treasury while paying duties the past two years.
The United States also charges an 8.4 percent levy, to make up, it says, for Canadian companies' selling in the States for less than the cost of production.
The United States has until July 30 to make its case to NAFTA yet again, said Andre Lemay, a spokesman for Canada's Trade Department.Miami Herald: