WTO creates two dispute settlement panels to review U.S. softwood lumber duties

MONTREAL — The World Trade Organization says its dispute settlement body has agreed to establish two panels to examine Canada’s complaint about duties imposed by the United States on softwood lumber imports.

The Canadian government requested March 27 that a panel be set up to examine the dispute after consultations with the U.S. in January failed to resolve the matter. It also requested a second panel to review the U.S. use of differential pricing methodology in its anti-dumping determinations.

Canada’s wide-ranging complaint to the WTO about the way the U.S. applies punitive tariffs has infuriated the Americans.

U.S. trade czar Robert Lighthizer called it a “massive attack” on the American system of international trade.

The U.S. objected to the Canadian requests, which argue that the anti-dumping and countervailing duties imposed on softwood lumber imports were inconsistent with U.S. obligations under the agreement on subsidies and countervailing measures and the general agreement on tariffs and trade.

Ottawa says the duties represent a “considerable hardship” on softwood lumber producers and communities across Canada.

The United States has argued that the duties were fully consistent with its obligations under the WTO agreements.

It has also raised concerns that Canada’s request for a panel included an item that wasn’t identified in its request that wasn’t part of the consultations.

The U.S. said the request included claims against the measures that don’t exist and therefore couldn’t be challenged. It also said Canada stated the matter was urgent even though the final determination in the anti-dumping investigation of softwood lumber from Canada made in November 2017.

The United States said it was disappointed that Canada had proceeded to request a special DSB meeting to consider its second panel request rather than addressing these concerns.

The Canadian government has suggested it might drop its major international trade case if it gets a softwood lumber deal.