Long-outlawed US trade policy wins WTO approval in Canada lumber dispute (updated)

Conifex Timber

09/04/2019 16:10

(Adds U.S. comment)
    By Tom Miles
    GENEVA, April 9 (Reuters) - A World Trade Organization
ruling approved a long-outlawed U.S. trade policy on Tuesday,
when a panel of adjudicators said Washington's use of "zeroing"
to calculate anti-dumping tariffs was permissible in the case of
Canadian softwood lumber. 
    The WTO's long-running row over zeroing is a technical
dispute that turned into a power struggle between the United
States and the arbiters of international trade law.
    The United States has suffered a string of defeats at the
WTO over zeroing, a calculation method that was ruled to have
unfairly increased the level of U.S. anti-dumping duties. 
    The repeated losses helped to fuel U.S. President Donald
Trump's campaign to reform the WTO, where the United States is
blocking appointments at the WTO's Appellate Body, effectively
the supreme court of world trade.
    Trump said last year the United States could withdraw from
the WTO if "they don't shape up". 
    U.S. Trade Representative Robert Lighthizer welcomed the
ruling by a WTO dispute panel, which he said showed the
"erroneous", "unpersuasive" and "flawed reasoning" of Appellate
Body rulings in the past. 
   "The United States commends this panel for doing its own
interpretive analysis, and for having the courage to stand up to
the undue pressure that the Appellate Body has been putting on
panels for many years," Lighthizer said in a statement.
    He said the WTO rules did not prohibit zeroing, and the
United States would never have signed up to WTO rules that did
prohibit the practice. 
    "WTO Appellate Body reports to the contrary are wrong, and
reflect over-reaching by that body," he said. 
    Canada launched the WTO dispute in November 2017, saying it
would forcefully defend its lumber industry against "unfair,
unwarranted and deeply troubling" U.S. tariffs.
    The U.S. Commerce Department had accused Canada of unfairly
subsidising and dumping softwood lumber, which is commonly used
in the construction of homes. Its duties affected about $5.66
billion worth of imports.  urn:newsml:reuters.com:*:nL2N1N816M
    There was no immediate reaction from Canada’s international
trade ministry, which could appeal against the ruling. 

 (Reporting by Tom Miles; Editing by Stephanie Nebehay and Mark
Potter)
 ((tom.miles@thomsonreuters.com; +41 58 306 2006; Reuters
Messaging: tom.miles.reuters.com@reuters.net))