NAFTA panel gives U.S. one week to cut softwood lumber duties | VailDaily.com
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NAFTA panel gives U.S. one week to cut softwood lumber duties

WASHINGTON – The Commerce Department said Wednesday it will meet a Nov. 23 deadline to comply with a NAFTA panel’s order that the United States drastically cut its duties on Canadian softwood lumber imports.The panel, created under the North American Free Trade Agreement, is calling on the Commerce Department to all but eliminate punitive duties that average more than 16 percent. Canada accounts for about one-third of the U.S. market for softwood, or easily sawed pine, spruce and other wood used in homebuilding.Last month, U.S. officials said they needed more time to consider the latest NAFTA ruling in favor of Canada. On Wednesday, after the NAFTA panel reiterated its call for quick U.S. action, the Commerce Department said it would meet the deadline.”The department is closely reviewing the panel’s response and will respond by the date set by the panel,” Franklin Lavin, undersecretary for international trade at the Commerce Department, said in a statement.The announcement was the latest development in a long-standing dispute between the two countries.The Bush administration imposed the tariffs in 2002, accusing Canada of subsidizing its lumber industry. Most U.S. timber is harvested from private land at market prices, while in Canada, the government owns 90 percent of timberlands.NAFTA panels repeatedly have found in favor of Canada. But Washington has essentially ignored the rulings, pointing to a preliminary World Trade Organization ruling that the United States complied with international law in imposing the tariffs.The WTO, which had initially ruled against the United States, said Tuesday that Washington has made sufficient changes to the import duties to satisfy international rules. The decision by the Geneva-based panel means the United States will avoid $3.5 billion in sanctions that Canada had said it would seek in the lumber dispute.Canada will appeal the WTO decision, Trade Minister Jim Peterson said. Peterson and other Canadian officials say NAFTA trumps WTO and that Washington should eliminate the tariffs and pay up.A U.S. lumber industry lobby disputed the NAFTA panel’s decision, saying it would force the Commerce Department to artificially underestimate the true extent to which Canadian lumber is subsidized.”The Commerce Department should not take action in response to the (NAFTA) panel order that contradicts U.S. law,” said Steve Swanson, chairman of the Coalition for Fair Lumber Imports.Vail, Colorado


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