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A history of U.S. trade challenges

U.S. trade challenges of Canadian wheat imports

Investigation	Conducted by	Completed	Outcome
1. Section 332: Conditions of competition between the U.S. and Canadian durum industries.	U.S. International Trade Commission (ITC) under Section 332 of Tariff Act of 1930	June 1990	Study confirmed Canadian wheat sold in the U.S. at or above U.S. market prices. No evidence to support U.S. allegations.
2. Review of CWB/AWB	U.S. General Accounting Office (GAO) requested by Senator Boren of Oklahoma	June 1992	No evidence of unfair trade practices.
3. Canada-U.S Trade Agreement	Bi-national Panel	Feb. 1993	Rules in favour of Canada. Receives audit of durum sales. First audit covered 3.5 years.
4. Wheat/products: harm to U.S. farm programs?	U.S. ITC, under Section 22 of Agricultural Adjustment Act of 1930	July 1994	1994-95 cap on exports to the U.S. negotiated. WTO has since ruled that the requirements of Section 22 are not compliant with international trade rules.
5. Canada-U.S. grain market and policy environment	Joint Commission on Grains	Oct. 1995	Recommendations made to improve trade in both directions.
6. Ability of STEs to distort trade	U.S. GAO	June 1996	U.S.D.A. officials acknowledge they did not have any evidence that CWB was violating existing trade agreements.
7. U.S. agricultural trade: Canadian wheat issues	U.S. GAO	Nov. 1998	No solid conclusions, but focused on areas of U.S. concern.
8. Countervailing duty (CVD): live cattle from Canada	U.S. Department of Commerce (DOC)	Oct. 1999	Final ruling confirms that the CWB does not provide a subsidy to cattle producers.
9. Section 332: Conditions of competition between the U.S. and Canadian wheat and durum industries.	U.S. ITC under section 332 of the Tariff Act of 1930.	Nov. 2001	The ITC report concludes, among other findings, that Canadian durum was sold into the U.S. at prices equal to or higher than U.S. durum in all but one of the 60 months examined.
10. Section 301: Conditions of competition.	U.S. Trade Representative under Section 301 of the Trade Act of 1974.	Feb. 2002	No justification found to impose barriers to the entry of Canadian wheat to the U.S. (using information from Section 332 report).
11. Countervailing duty (CVD): investigations of durum and hard red spring (HRS) from Canada	U.S. DOC U.S. ITC on injury (see below) North American Free Trade Agreement (NAFTA) panel on appeal	Aug. 2003 Oct. 2003 Nov. 2003 June 2005	Final CVD ruling imposes duties of 5.29% on Canadian durum and HRS imports: 0.35% due to free provision of government hopper cars and 4.94% due to CWB guarantees. The latter benefit (4.94%) was concocted by the DOC using methodology that violates its own regulations/practices, as well as Article XIV, WTO Agreement on Subsidies and Countervailing Measures. The CWB appeals DOC's CVD ruling re. guarantees to a NAFTA panel. The Panel agrees with CWB arguments and, on March 10, 2005, orders the DOC to reconsider its countervailing duties related to CWB financial guarantees. On August 8, 2005 the CVD is lowered to 2.54 per cent. The CWB successfully appeals the ITC'S injury determination on HRS to a NAFTA panel. Panel ruling, released June 7/05, states that there was not substantive evidence to support the ITC'S determination. The ITC reverses its injury ruling. The tariff is lifted as of Feb. 24, 2006.
12. Anti-dumping (AD) investigations of durum	U.S. DOC U.S. ITC on injury U.S Court of International Trade (CIT) on appeal	Aug. 2003 Oct. 2003 July 2004	Final AD ruling imposes duties of 8.26% on Canadian durum imports, bringing total tariff to 13.55% October 2003: ITC commissioners unanimously find no injury on U.S. durum producers tariff revoked on Canadian durum imports. July 2004: CIT dismisses U.S. appeal of ITC injury ruling.
13. Anti-dumping (AD) investigations of hard red spring wheat	U.S. DOC U.S. ITC on injury U.S. CIT re. tariff disbursement NAFTA panel on appeal	Aug. 2003 Nov. 2003 June 2005	Final AD ruling imposes duties of 8.87% on Canadian HRS imports, bringing total tariff to 14.16%. October 2003: ITC Commissioners split 2-2 on HRS injury; decision defaults to petitioners, tariff remains on Canadian HRS imports. April 2005: The CWB files legal action with CIT against so-called Byrd Amendment disbursement of tariff proceeds to petitioners (North Dakota Wheat Commission). Case pending. The CWB successfully appeals the ITC's injury determination on HRS to a NAFTA panel. Panel ruling, released June 7/05, states there was not substantive evidence to support the ITC's determination. The ITC reverses its injury ruling. The tariff is lifted as of Feb. 24, 2006.
14. Canada Measures relating to exports of wheat and treatment of imported grain (DS276)	WTO dispute settlement panelWTO Appellate Body on appeal	April 2004 Aug. 2004	In April/04, the WTO panel dismisses U.S. claims, exonerating the CWB of allegations that the single-desk marketing system creates an incentive to act non-commercially, in violation of GATT Article XVII (i.e., the rules governing the behaviour of state trading enterprises). On August 30, 2004, WTO Appellate Body dismisses the U.S. appeal of the above decision. The Panel found that three Government of Canada (GOC) measures violate GATT Article III. These include the Canadian Grain Commission's (CGC) requirement for pre-authorization to receive U.S. grain into a Canadian elevator; the CGC's requirement that restricts mixing of eastern grain in transfer elevators with other eastern grain (to the exclusion of foreign grain), and the exclusion of foreign grain from application of the rail revenue cap. The GOC has taken steps to comply.