Wednesday, 15 August, 2018

Canada files WTO complaint over United States trade practices

Canada files WTO complaint over United States trade practices Canada files WTO complaint over United States trade practices
Melinda Barton | 13 January, 2018, 08:34

Canada says the USA violated the WTO's Anti-Dumping Agreement, the Agreement on Subsidies and Countervailing Measures, the General Agreement on Tariffs and Trade 1994 and the Understanding on Rules and Procedures Governing the Settlement of Disputes.

On Wednesday the country requested that the World Trade Organization step in to review certain US trade actions and whether they're in accordance with its obligations as a member of the WTO.

The WTO filing comes less than two weeks before the sixth round of North American Free Trade Agreement (NAFTA) renegotiation talks between the two countries and Mexico resume January 23 in Montreal.

A spokesman for Foreign Affairs Minister Chrystia Freeland said this challenge is tied to Canada's latest fight with the United States over softwood lumber.

The complaint covers actions taken against not just Canada but countries all around the world, from Japan to South Africa.

"Even if Canada succeeded on these groundless claims, other countries would primarily benefit, not Canada", he said.

Mr. Trump has repeatedly threatened to pull out of NAFTA - or at least trigger the withdrawal process to increase pressure on Canada and Mexico. Canada has protested the tariffs in other filings with the WTO and under the North American Free Trade Agreement.

It's possible other countries may join this complaint as intervenors, making it a bigger and more embarrassing problem for the USA government.

The Canadian government has launched a sweeping World Trade Organization complaint against a litany of USA trade practices, alleging almost 200 violations of WTO rules by US investigators reaching back more than 20 years, according to documents published Wednesday. Sands, who said the move may have come because Canadian trade negotiators and politicians believe the strategy of playing nice with the Trump administration has not paid dividends. "But with the Trump administration being relatively new, and because of the protectionist noises we've been hearing from them, it's not at all clear what sort of reaction the USA might have".

Canadian Foreign Minister Chrystia Freeland said the legal action was in response to "unfair and unwarranted" U.S. duties against Canada's softwood lumber producers, and is part of a "broader litigation" to defend its forestry jobs.

In a statement in response to Canada's move, U.S. Trade Representative Robert Lighthizer said, "Canada's new request for consultations at the WTO is a broad and ill-advised attack on the U.S. trade remedies system".

The move was denounced by the US and had some trade experts worrying it could derail already tense negotiations to renew the North American Free Trade Agreement.

"Canada is acting against its own workers' and businesses' interests", Lighthizer added.

Anticipating an imminent US retreat from NAFTA, the Canadian government has made a decision to go on the offensive in managing its trade relations with our Southern neighbor.

"In a normal situation you wouldn't expect this to impact the long-term trading relationship that we've got under NAFTA", he said.

If Canada is successful at the WTO, the United States may have to change the way it approaches trade remedies cases.