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<title>STATEMENT BY MINISTER PETTIGREWON U.S. SOFTWOOD LUMBER ANTI-DUMPING DECISION </title>
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<p><font size="+1"></font><font size="+1"><strong>October 31, 2001 <em>(4:00 p.m. EST)</em> No. 148</strong></font></p>
<p align="CENTER"><font size="+1"><strong>STATEMENT BY MINISTER PETTIGREW</strong></font></p>
<p align="CENTER"><font size="+1"><strong>ON U.S. SOFTWOOD LUMBER ANTI-DUMPING DECISION </strong></font></p>
<p>International Trade Minister Pierre Pettigrew responded today to the United States Department of Commerce preliminary
determination in its anti-dumping investigation of softwood lumber from Canada. The Department of Commerce found that
Canadian softwood lumber exports to the United States were dumped in the U.S. on average by 12.58 percent.</p>
<p>"Although we are not surprised by the decision, it is totally unjustified. This punitive action will only add to the difficulties
of our lumber producers, their employees and lumber-dependent communities across Canada, especially in times of
economic uncertainty. I have already conveyed my views to U.S. Secretary of Commerce Evans. </p>
<p>Unlike the countervailing duty case, this is a decision relating to the pricing practices of individual companies. We will
continue to challenge U.S. laws and policies at the World Trade Organization. We will also continue our discussions with
the U.S. Administration to seek a durable long-term solution to our trade differences. We will continue to stand by our
softwood lumber industry.</p>
<p>I spoke last week with all provincial ministers responsible for trade. We will review this latest decision with provincial and
territorial governments and with industry stakeholders to determine our next steps as the dumping case proceeds. In
response to requests from Canadian lumber producers, Canada's Export Development Corporation is mandated to address
the needs of company bonding requirements through existing programs.</p>
<p>I am heartened by the support Canadian industry received last week from the U.S. National Black Chamber of Commerce,
the United States Hispanic Contractors Association, Consumers for World Trade, and the U.S. National Lumber and
Building Material Dealers Association who called upon the U.S. Congress and Administration to support free trade in
softwood lumber. </p>
<p>The Government of Canada will continue to defend the rights of Canada's softwood lumber industry." </p>
<p align="CENTER">- 30 -</p>
<p>A backgrounder is attached.</p>
<p>For further information, media representatives may contact:</p>
<p>Sébastien Théberge</p>
<p>Office of the Minister for International Trade</p>
<p>(613) 992-7332 </p>
<p>Media Relations Office</p>
<p>Department of Foreign Affairs and International Trade </p>
<p>(613) 995-1874</p>
<p><font size="+1"><strong>Backgrounder</strong></font></p>
<p><font size="+1"><strong>U.S. DEPARTMENT OF COMMERCE PRELIMINARY DETERMINATION</strong></font></p>
<p><font size="+1"><strong>OF DUMPING OF SOFTWOOD LUMBER</strong></font></p>
<p>The U.S. Department of Commerce today issued its preliminary determination of dumping in its investigation of softwood
lumber from Canada. The Department of Commerce found that Canadian softwood lumber exports to the United States
were dumped on average by a margin of 12.58 percent. Individual dumping margins were also calculated for the six
mandatory respondents (Abitibi,13.64 percent, Canfor,12.98 percent, Slocan,19.24 percent, Tembec,10.76 percent, West
Fraser, 5.94 percent, and Weyerhaeuser,11.93 percent).</p>
<p>The Department of Commerce did not find "critical circumstances." As a result, there will be no retroactive anti-dumping
measures. </p>
<p>An anti-dumping duty is a special duty imposed to protect domestic injury from goods sold in that market at prices that are
below those charged for comparable sales in the producer's home market or that are below the cost of producing the goods.
Such a duty can only be applied if it has been determined in an investigation that imported goods have been dumped and
that such dumped goods are causing material injury, or threatening to cause injury to the domestic industry.</p>
<p>As a consequence of this determination, Canadian firms shipping softwood lumber into the United States will be required
to make a cash deposit or post bonds equal to the amount of the dumping rate found in the preliminary determination within
ten days.</p>
<p>On April 2, 2001, the U.S. Coalition for Fair Lumber Imports filed a petition alleging that Canadian exporters were
dumping softwood lumber into the United States. This anti-dumping investigation was initiated by the Department of
Commerce on April 21. On May 16, the U.S. International Trade Commission made a positive preliminary finding of threat
of injury concerning both the anti-dumping and countervailing duty investigations.</p>
<p>The dumping determination is unfounded. There was no basis upon which to initiate the investigation in the first place.
Furthermore, the petition failed to provide adequate Canadian export price data, and the petition includes a number of
errors in the calculation of the dumping margin.</p>
<p>The Department of Commerce must make final determinations concerning both anti-dumping and critical circumstances, to
be followed by a final determination of injury by the U.S. International Trade Commission. If affirmative, the Commission
also needs to make a final determination as to whether the imports subject to any final affirmative critical circumstances
determination are likely to seriously undermine the remedial effect of the anti-dumping duty order to be issued. These
decisions will be made during the course of the next several months, with a final determination of injury not expected until
mid-May 2002.</p>
<p>Final determinations of dumping, injury and critical circumstances are subject to judicial review in the U.S. courts or a
binational panel review under Chapter 19 of NAFTA.</p>
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