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<title>PETTIGREW LAUNCHES WTO CHALLENGE OF U.S. SOFTWOOD LUMBER ANTI-DUMPING ACTION</title>
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<p><font face="Arial" size="+1"></font><font face="Arial" size="+1"></font><font size="+1"><strong>March 6, 2002 </strong></font><font face="Arial" size="+1"><strong> <em>(1:35 p.m. EST)</em> No. 24</strong></font></p>
<p align="CENTER"><font size="+1"><strong></strong></font><font size="+1"><strong>PETTIGREW LAUNCHES WTO CHALLENGE OF </strong></font></p>
<p align="CENTER"><font size="+1"><strong>U.S. SOFTWOOD LUMBER ANTI-DUMPING ACTION</strong></font><font face="Arial" size="+1"><strong></strong></font></p>
<p>International Trade Minister Pierre Pettigrew announced today that Canada has requested World Trade Organization
(WTO) consultations with the United States concerning its October 30, 2001 preliminary finding that Canadian softwood
lumber was dumped into the U.S. market. </p>
<p>"The U.S. anti-dumping determination fails to meet WTO standards," said Minister Pettigrew. "As such, we have requested
WTO consultations on this matter. This challenge comprises one more element in Canada's ongoing strategy to defend the
interests of its softwood lumber exporters."</p>
<p>Canada's request for consultations will examine the methods used by the U.S. Department of Commerce (DOC) for
determining the anti-dumping duties imposed on Canadian softwood lumber producers.</p>
<p>On August 21, 2001, Canada also initiated a WTO challenge of the U.S. DOC's preliminary countervailing duty
determination.</p>
<p>In separate proceedings, the Government of Canada filed notices of intent in February 2002 requesting the establishment of
a binding panel under Chapter 19 of the NAFTA to review the U.S. DOC's final countervailing and dumping
determinations.</p>
<p>The request for consultations is the first step in proceedings under the WTO Dispute Settlement Understanding.<font face="Arial"></font></p>
<p>- 30 -</p>
<p>A backgrounder is attached.</p>
<p>For further information, media representatives may contact:</p>
<multicol cols="2" gutter="46">
<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<font face="Arial"></font></p>
<p><a href="https://bac-lac.wayback.archive-it.org/web/20070221124622/http://www.dfait-maeci.gc.ca/"><font face="Arial">http://www.dfait-maeci.gc.ca</a></multicol>
</font><strong><font size="+1">Backgrounder</strong></font><font size="+1"></font></p>
<p>On March 6, 2002, Canada formally requested consultations with the United States with respect to the U.S. Department of
Commerce's preliminary anti-dumping determination concerning certain softwood lumber products from Canada. On
October 30, 2001, the DOC preliminarily determined that producers/exporters of softwood lumber from Canada have sold
their product into the United States at below fair value. </p>
<p>Such a duty can only be applied where it is established in an investigation that imported goods were sold at below fair value
and were either causing material injury, or threatening to cause material injury, to the domestic industry. The DOC will
make its final determination of dumping on March 21, 2002, and will announce its decision the following day.</p>
<p>Canada's request for consultations will examine three aspects of the U.S. preliminary anti-dumping determination. Canada
will query the initiation of the anti-dumping investigation, insofar as the petition did not contain reasonably available
information on actual transaction prices at which softwood lumber is sold in Canada, and generally failed to contain
"sufficient evidence" to justify the initiation of an investigation.</p>
<p>Furthermore, Canada will discuss the WTO consistency of the United States' calculation of sales at less than fair value.
This calculation disregarded certain sales of like products in Canada's domestic market, something that resulted in
improper price comparisons and an inflation of weighted-average margins of dumping.</p>
<p><font face="Arial">Finally, Canada will consult with the United States on its application of the practice of zeroing. In calculating the
overall dumping margin of an exporter, a margin of zero is applied to goods for which a negative dumping
margin exists. This practice of zeroing prevents the negative margin for one category of goods from offsetting a
margin of dumping for another category of goods from the same producer. Zeroing serves to enforce the
principle that merchandise is either dumped, in which case there is a margin of dumping, or is not dumped, in
which case the margin is zero.</font></p>
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