Thursday, February 16, 2006

The Lumber Trade Fight, Round XVIII (I've Lost Count)

Canada appears to have lost a round in the never-ending dispute over U.S. duties on softwood lumber. A WTO panel has ruled that U.S. duties do not violate WTO obligations. Canada's view, of course, is that the U.S. duties do violate WTO obligations, in part because they also violate NAFTA obligations. Essentially, the U.S. has consistently lost in the NAFTA tribunals, but has consistently won in the WTO cases. Technically this shouldn't matter since each treaty represents a different set of trade obligations. But the fact that the WTO is fine with the U.S. duties does lend some intellectual support to the U.S. position. All of this confusion and uncertainty suggests litigation here is becoming a collossal waste of time and money. Ironically, the various litigation venues has impeded a deal in this case. Someone end the madness and settle this dispute.

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