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The U.S. International Trade Commission (ITC) Ruling on Softwood Lumber

May 3, 2002

Wrapping up its countervailing and anti-dumping investigations, the United States International Trade Commission (ITC) found that Canadian softwood lumber exports have posed a threat of injury to U.S. lumber producers.

This ITC decision was not unexpected. It is in keeping with the protectionist nature of other recent U.S. softwood lumber decisions – decisions that Canada is already challenging in the World Trade Organization and the North American Free Trade Agreement.

We will conduct an immediate review regarding possible challenges of the ITC’s decision as soon as the ITC provides its reasons. We feel it is important for governments to gain a clear picture of the finding as we determine how to respond to it.

The decision of the ITC means that all bonds posted should be cancelled as in the past, and that cash deposits made prior to May 16 should be refunded as in the past by the U.S. Customs Service, thus eliminating over $760 million in contingent duty liabilities being carried by Canadian lumber producers.

It is hard to understand how the U.S. Commission found a threat of injury given the stable Canadian share of the U.S. market, the strong U.S. lumber market and U.S. industry profitability.

The decision of the ITC does not change our course of action.

We are extremely sensitive to the impact the U.S. duties will have on Canadian workers, communities and firms.

The Government of Canada, through its united approach with the provinces and industry, will continue to defend the rights of the Canadian softwood lumber industry at the World Trade Organization and under the North American Free Trade Agreement. Our case is solid and we are confident we will prevail.

We will continue to argue the simple facts: that the Canadian softwood lumber industry's success in the American market reflects its competitiveness – nothing more nothing less.

We are talking to our provincial partners and the industry to assess how best to protect the interests of communities and workers.


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