WTO backs U.S. in lumber fight with Canada

GENEVA – The WTO ruled that the United States complied with international law in its calculation of tariffs against Canadian lumber imports, according to a report made public Monday.

Canada argued the United States artificially inflated antidumping rates by using a different calculation method to avoid complying with an earlier World Trade Organization decision.

But a WTO panel, which originally released its findings to the parties in February, said that the U.S. had not broken trade rules in its calculation of the duties.

The U.S. imposed antidumping and countervailing duties totaling more than 27 percent in May 2002 after accusing Canada of subsidizing its lumber industry. The U.S. Commerce Department, responding to a complaint under the North American Free Trade Agreement, reduced punitive duties late last year from an average of 16 percent to less than 9 percent. Most U.S. timber is harvested from private land at market prices, while in Canada, the government owns 90 percent of timberlands and charges fees for logging.

The decades-long dispute has fueled talk of an outright trade war between the world’s largest trading partners and concerns that the rules of free trade under the North American Free Trade Agreement among the U.S., Canada and Mexico were unraveling.