Canada protests U.S. softwood lumber tariffs
OTTAWA (Reuters) - Canada will challenge what Ottawa called an "unfair, unjust and illegal" extension of U.S. tariffs on imports of Canadian softwood products, Trade Canada said on Tuesday.
The softwood tariffs are the product of a decades-long trade dispute over the structure of Canada's lumber industry that was not resolved when a quota agreement expired in 2015. U.S. producers say Canada unfairly subsidises its lumber industry.
The U.S. Commerce Department imposed a 7.99 per cent tariff on the product in July.
Canada filed a notice of intent to pursue a judicial review of those tariffs on Monday, Trade Canada said in a statement, adding that Ottawa remains open to discussing the outcome of negotiations with Washington. The department often challenges under the rules of the U.S.-Mexico-Canada trade agreement.
"For years, the U.S. has imposed unfair, unjust and illegal tariffs on Canadian softwoods, harming Canadian industry and increasing housing costs in both countries," Trade Minister Mary Wu said in a statement.
The U.S. bases its tariffs on the fact that Canadian timber harvested from federal and provincial lands, where governments set lower stumpage fees, constitutes an unfair subsidy, while most U.S. timber is harvested from private lands at market prices.
The USTR said it is working to ensure a level playing field.
"When Canada is ready to address the underlying issues related to subsidies and fair competition, we are prepared to discuss another softwood agreement so that Canadian timber imports do not harm the U.S. industry," a spokesman for the USTR said in an emailed statement.
The U.S. Commerce Department did not immediately respond to a request for comment.
