Canada Fears U.S. Trade Attack; Files WTO Complaint

ByBridgeNews Canada has filed a complaint with the World Trade Organization (WTO) against U.S. legislation that could allow the U.S. to impose duties on Canadian goods from April 2001, when a softwood lumber agreement ends. Under the agreement, made in 1996, Canada imposes duties on timber exports and in return, the U.S. agrees not to levy counterveiling duties on a range of Canadian products including wheat, cattle, sugar, and textiles. Canada fears that the end of the agreement will spur the U.S. to launch a rash of cases against its domestic subsidies, protected by the lumber deal. Consultations between the two, obligatory under WTO rules, have failed, and WTO arbitrators will now be appointed to examine the issue. Canada claims that U.S. legislation would define its export restraints as subsidies and therefore expose its exports to counterveiling duties. While there are no counterveiling subsidy cases currently between the two neighbors, Canada describes its WTO request as "pre-emptive." and insists that the U.S. legislation violates WTO commitments.