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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 14pt"><span style="font-weight: bold">August 11, 2004 <i>(12:00 p.m. EDT)</i> No. 90</span></span></span></p>
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<p style="text-align: center"><span style="font-family: 'Arial', sans-serif"><span style="font-size: 14pt"><span style="font-weight: bold">WTO APPELLATE BODY RULES IN CANADA’S FAVOUR ON<br>
SOFTWOOD ANTI-DUMPING DUTIES</span></span></span></p>
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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt">Jim Peterson, Minister of International Trade, welcomed today’s World Trade
Organization (WTO) Appellate Body decision that found the United States’ use of
zeroing to be inconsistent with the WTO Anti-dumping Agreement. The Appellate Body
also found in favour of Canada regarding Abitibi Consolidated Inc. The WTO report
recommends that the U.S. bring its anti-dumping measures with respect to softwood
lumber from Canada into conformity with its WTO obligations.</span></span></p>
<br>
<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt">“We are pleased that the WTO Appellate Body affirmed that the U.S. practice of
zeroing in this case breaches WTO anti-dumping rules,” said Minister Peterson. “We
are also very pleased that the Appellate Body ruled in Canada’s favour on Abitibi. We
urge the U.S. to comply with this ruling.”</span></span></p>
<br>
<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt">Zeroing is the practice of assigning a margin of zero to goods for which the export price
exceeds the home market price. This difference is also referred to as a “negative
dumping margin.” Zeroing prevents the negative margin for one category of goods from
offsetting a margin of dumping for another category of goods. This is an important issue
because zeroing results in higher dumping rates.</span></span></p>
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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt">Canada had asked the Appellate Body to reconsider the Panel’s findings with respect to
the calculations of the dumping margins for Abitibi Consolidated Inc. and Tembec Inc.
In today’s report, the Appellate Body reversed the Panel’s legal findings with respect to
Abitibi and upheld the Panel’s findings regarding Tembec.</span></span></p>
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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt">The Appellate Body’s report will be adopted by the WTO Dispute Settlement Body
within 30 days. Once the Dispute Settlement Body has adopted the report, the U.S. will
be required to bring its measures into conformity with its WTO obligations within a
reasonable period of time.</span></span></p>
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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt">Dumping is the sale of goods in a foreign market at prices below those charged for
comparable sales in the home market or that are below the cost of producing the
goods.</span></span></p>
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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt">For more information regarding softwood lumber issues in general, please visit
</span></span><a href="https://bac-lac.wayback.archive-it.org/web/20061209063152/http://www.softwoodlumber.gc.ca/"><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #0000ff"><span style="text-decoration: underline">http://www.softwoodlumber.gc.ca</span></span></span></span></a><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #000000">.</span></span></span></p>
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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #000000">The WTO panel report is available at </span></span></span><a href="https://bac-lac.wayback.archive-it.org/web/20061209063152/http://www.wto.org/"><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #0000ff"><span style="text-decoration: underline">http://www.wto.org</span></span></span></span></a><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #000000">.</span></span></span></p>
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<p style="text-align: center"><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #000000">- 30 -</span></span></span></p>
<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #000000">A backgrounder is attached.</span></span></span></p>
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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #000000">For further information, media representatives may contact:</span></span></span></p>
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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #000000">Jacqueline LaRocque<br>
Director of Communications<br>
Office of the Minister of International Trade<br>
(613) 992-7332</span></span></span></p>
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<p><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #000000">Media Relations Office<br>
Foreign Affairs Canada and International Trade Canada<br>
(613) 995-1874<br>
</span></span></span><a href="https://bac-lac.wayback.archive-it.org/web/20061209063152/http://www.international.gc.ca/"><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #0000ff"><span style="text-decoration: underline">http://www.international.gc.ca</span></span></span></span></a><span style="font-family: 'Arial', sans-serif"><span style="font-size: 12pt"><span style="color: #000000"></span></span></span></p>
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<p style="text-align: center"><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-size: 14pt"><span style="font-weight: bold">Backgrounder</span></span></span></span></span></p>
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<p style="text-align: center"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-size: 14pt"><span style="font-weight: bold">CHRONOLOGY OF KEY EVENTS</span></span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">April 2, 2001</span>: The United States Department of Commerce (DOC) initiated its
anti-dumping duty investigation of Canadian softwood lumber.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">October 30, 2001</span>: The DOC made a preliminary dumping duty determination. Six
Canadian exporters (respondents) were assessed individual margins of dumping,
provisionally ranging from 5.94 percent to 19.24 percent. The average margin of
dumping (12.58 percent) for these six respondents was used to establish the rate for all
other Canadian exporters of softwood lumber.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">March 22, 2002</span>: The DOC announced a final affirmative determination of dumping.
The six Canadian respondents were assessed individual margins of dumping ranging
from 2.18 percent to 12.44 percent. An “all others” margin of dumping of 8.43 percent
was applied to all other Canadian exporters of softwood lumber.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">January 8, 2003</span>: At Canada’s request, the WTO established a panel to resolve the
dispute.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">June 17-18, 2003</span>: The Panel held its first hearing in this case.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">July 29-30, 2003</span>: The Panel held its second hearing in this case.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">April 13, 2004</span>: The Panel issued its final report to the parties.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">May 13, 2004</span>: The U.S. appealed the Panel’s findings with respect to zeroing.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">May 28, 2004</span>: Canada cross-appealed the Panel’s findings with respect to two
company-specific issues.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">June 22, 2004</span>: The WTO Appellate Body held a hearing.</span></span></span></p>
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<p><span style="font-size: 12pt"><span style="color: #000000"><span style="font-family: 'Arial', sans-serif"><span style="font-weight: bold">August 11, 2004</span>: The WTO Appellate Body issued its report.</span></span></span></p>
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