Canada Targets US Trade Remedies With Massive WTO Case

Posted January 14, 2018

"Canada's claims are unfounded and could only lower US confidence that Canada is committed to mutually beneficial trade", Lighthizer said.

While Canada continues to hope for the best from the NAFTA renegotiation, Freeland says it is also preparing for the worst-case scenario - a decision by President Donald Trump to withdraw from the three-way, continental trade pact. It also accuses the United States of using a trade-panel voting system that's biased against foreigners. The association applauded the efforts of Democratic and Republican U.S. Senators, and the publishers of over one thousand small and medium-sized U.S. newspapers who have demanded that Washington not impose countervailing and anti-dumping duties on Canadian newsprint.

The complaint ramps up tensions amid talks on renegotiating the North American Free Trade agreement.

If Canada is successful at the WTO, the United States may have to change the way it approaches trade remedies cases.

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The thinly veiled threat gives new rise to concerns for positive progress in the ongoing NAFTA renegotiations ahead of the next round of talks set for January 23 in Montreal.

The confusion over Canadian expectations comes ahead of the next round of negotiations, scheduled to be held in Montreal Jan. 23-28.

"Canada is acting against its own workers' and businesses' interests", he said. Chapter 19 allows the parties to bypass the national judicial system to challenge countervailing and anti-dumping duties.

Canada has launched an attack on U.S. trade practices with an worldwide complaint over Washington's use of punitive duties.

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With its WTO filing, Canada is forcing the United States to put its logic to the test.

"These rates tabled lby the US on uncoated groundwood paper represent the third action that stands to hurt hard working men and women in our mill communities across Canada", says Derek Nighbor, CEO, Forest Products Association of Canada.

"For example, if the US removed the orders listed in Canada's complaint, the flood of imports from China and other countries would negatively impact billions of dollars in Canadian exports to the United States, including almost $9 billion in exports of steel and aluminum products and more than $2.5 billion in exports of wood and paper products".

Canada says the US violated the WTO's Anti-Dumping Agreement, the Agreement on Subsidies and Countervailing Measures, the General Agreement on Tariffs and Trade 1994 and the Understanding on Rules and Procedures Governing the Settlement of Disputes.

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Ideally, Canada would want to keep both chapter 19 and the United States' commitment to the WTO, since it gives it more ammunition in disputes. What started as tariffs on lumber products has blown up into a vast relitigation of trade disputes going back two decades.