U.S- Canada Softwood Lumber Agreement Enters Into Force on October 12, 2006
The Office of U.S. Trade Representative (USTR) and the Commerce Department have each issued press releases announcing that the U.S. - Canada Softwood Lumber Agreement (SLA) has entered into force on October 12, 2006.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
As a result, the press releases state that both the U.S. and Canada will begin to implement their obligations under the agreement, which will include the following actions:
Canadian Government to Immediately Collect an Export Tax, Etc.
According to the press releases, the implementation of the SLA means that Canada will immediately begin the collection of an export tax, based on current market prices for softwood lumber.
(USTR explains that as the lumber market is currently soft, Canadian exporting provinces can choose either to collect an export tax that ranges from 5 to 15 percent as prices fall or to collect lower export taxes and limit export volumes. When market conditions are favorable, the USTR states that unrestricted trade will occur.)
U.S. to Immediately Revoke AD and CV Orders, Begin Refunding AD/CV Deposits
For the United States, the press releases indicate that the implementation of the SLA will result in the immediate revocation of the AD and CV orders on Certain Softwood Lumber Products from Canada, and an end to the collection of AD/CV duty deposits on such imports.
Moreover, a process will be initiated to refund the associated AD/CV duty deposits currently held by U.S. Customs and Border Protection (CBP), except where a court order prevents it.
(See ITT's Online Archives or 10/18/06 news, 06101840 for BP summary of ITA's revocation of the AD and CV orders, etc.)
Disbursement of AD/CV Duty Deposits
According to the press releases, with respect to the disbursement of AD/CV duty deposits currently held in clearing accounts separate from the general treasury by CBP, approximately $4.3 billion will be returned to the importers of record.
In addition, $500 million will be provided to the Coalition for Fair Lumber Imports (the petitioners in the AD/CV duty cases), $50 million will be provided to a bi-national industry council; and $450 million will be disbursed to promote meritorious initiatives in the U.S. ($200 million to the U.S. Endowment for Forestry and Communities, Inc.; $150 million to the American Forestry Foundation, and $100 million to Habitat for Humanity International).
(See ITT's Online Archives or 07/11/06 news, 06071100 for BP summary on U.S. and Canada reaching agreement on Softwood Lumber dispute.)
USTR press release (dated 10/12/06) available at http://www.ustr.gov/Document_Library/Press_Releases/2006/October/US_Trade_Representative_Susan_C_Schwab_Announces_Entry_into_Force_of_US-Canada_Softwood_Lumber_Agreement.html
Commerce Department press release (dated 10/12/06) available at http://www.commerce.gov/opa/press/Secretary_Gutierrez/2006_Releases/October/12-Softwood_Lumber_Agreement_stmnt.htm