West Hill Collegiate Institute - International Business

Established in 2012, by Daniel Shafransky and Raymond Ahmad

Dispute Over Repayment of Duties 2002

Source: Softwood Dispute: Run for the border

Image result for canada us softwood lumber dispute

  • Nipuni Kuruppu
  • Mariam Ibrahim
  • Zainab Raza


  1. In 2002, tension between Canada and the U.S. in regards to the softwood lumber dispute rose over. In April that year, the U.S. Department of Commerce lowered duties of countervailing to 18.79% and anti-dumping duties to 8.43%. The U.S. gave duties of 27.22% total to Canada because they believed that Canada unfairly subsidized producers of lumber. Canada responded to this with their own trade challenges. To the World Trade Organization and under the North American Free Trade Agreement, they requested separate panels to go over the three claims made by the U.S. Department of Commerce. There have been contradictory rulings by the panels. NAFTA ruled in favour of Canada, but WTO concluded that Canada softwood lumber imports did threaten the U.S. market. This contradictory rulings led to a further dispute of if the U.S. would have to repay the large sum of duties that had been collected. The position taken by Canada is that the U.S. should repay the duties they charged on Canadian softwood lumber, but the U.S. believed that Canada must bargain with them first. There was no resolution as the U.S. ignored the NAFTA ruling and pursued the one made by WTO.

    “CBC News Indepth: Softwood Lumber Dispute.” Cbc.ca. N.p., 2006. Web. 2 Nov. 2017.
    Makarenko, Jay. “The Canada-US Softwood Lumber Dispute | Mapleleafweb.Com.” Mapleleafweb.com. N.p., 2008. Web. 2 Nov. 2017.
    Charron, Michel. “Lumber I To IV: History Of The Canada-U.S. Softwood Lumber Dispute.” Lop.parl.ca. N.p., 2005. Web. 2 Nov. 2017.

  2. This video discusses the initial ruling of the WTO in favour of Canada. They believe that the U.S. is wrong to impose duties on Canada for their lumber imports. Many lumber producers have lost out on a lot of money and many Canadians have also lost jobs because of this dispute. Canada won 8 of 9 technical arguments before the WTO. The Federal Trade minister said that the ruling is a fundamental victory for Canada. This decision only applies to the original 19% duty imposed in March 2001. This means Canadian companies had to continue to pay the 27% duty even after the ruling. Despite this preliminary hearing, some mill owners believe that this decision is just a play by the American strategy to force them out of business.

    VIDEO: http://www.cbc.ca/archives/entry/softwood-dispute-canada-claims-victory-at-wto

    “The National.” CBC, 2002. TV programme.

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