US Blocks Request for Panel at WTO on Softwood Lumber
Canada said consultations with the United States over softwood lumber antidumping and countervailing duties have been unsuccessful since they began on Jan. 17, and asked for the formation of two panels, one for CVD and one for AD duties. The request was made at a World Trade Organization meeting on March 27. The U.S. blocked formation of the panels, but according to WTO rules, it can only do so temporarily. If Canada asks for a panel at the next Dispute Settlement Body meeting, a panel will be formed to judge the dispute.
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Canada says the investigation into Canadian subsidies for softwood lumber harvesting was improper, as was the way it determined the CV duties, which can be as high as 17.99 percent. The antidumping duties are as high as 7.28 percent. The U.S. said the panel Canada is asking for applies to a duty order that had not yet been issued when consultations started, and that all its actions are consistent with WTO rules. It also said it believes Canada's argument for an accelerated timeline has no justification. The U.S. ruled there were illegal subsidies on softwood lumber from Canada in November (see 1711070019). Before that determination, Canada was negotiating for a cap on exports, but warned if the U.S. took AD/CVD actions, Canada would litigate and would no longer agree to negotiate (see 1708240031).
According to a Geneva trade official, a Korean official backed Canada, saying that the U.S. has not complied with a WTO panel ruling on an earlier AD/CVD case involving Korean washing machines. If the U.S. had implemented that ruling, Canada would not need to pursue its case, Korea said, because the issues are the same. Also at the meeting, the U.S., as it has for seven months (see 1709290010), continued to block any appointment of appellate body representatives at the WTO. That body has three vacancies.