Skip to content

Tribunal rules Canada broke softwood deal, U.S. says

WASHINGTON — An international arbitration tribunal has ruled provincial programs in Quebec and Ontario violate the softwood lumber agreement between Canada and the United States, a top U.S. trade official said Friday.

WASHINGTON — An international arbitration tribunal has ruled provincial programs in Quebec and Ontario violate the softwood lumber agreement between Canada and the United States, a top U.S. trade official said Friday.

Under the rules, the decision from the London court is final.

“The tribunal agreed that a number of provincial assistance programs put into place by Quebec and Ontario circumvent the Softwood Lumber Agreement and breach the deal struck by the United States and Canada in 2006,” U.S. Trade Representative Ron Kirk said in a statement.

The ruling is the second win for the U.S. at the arbitration tribunal.

The court previously ruled against Canada over the calculation of export quotas for the first six months of 2007.

The tribunal on Friday took issue with three programs in Quebec and two in Ontario aimed at helping the forestry sector with tax credits and loan guarantees.

The U.S. says Canada must “cure the breach” or impose additional charges on exports of softwood lumber from Quebec and Ontario to the United States.

The additional export charges, which would remain in place for the life of the softwood agreement, would amount to about $59.4 million, the U.S. estimated.

Earlier this week, the U.S. requested arbitration of a case that alleges British Columbia is breaking the agreement by “dramatically” increasing the amount of timber it is selling at a cut-rate price in an effort to clear dead, beetle-infested timber.