6 - United States – Final Determination with Respect to Certain Softwood Lumber from Canada (AB-2003-6, WT/DS257/AB/R)

Summary

Introduction

This note addresses the Word Trade Organization (WTO) dispute United States – Final Countervailing Duty Determination With Respect To Certain Softwood Lumber From Canada (WT/DS257); denoted “Softwood Lumber IV ” below. The issues discussed by the Panel and the Appellate Body (AB) in this dispute are very closely related to those examined by the Panel in United States – Preliminary Countervailing Duty Determination With Respect To Certain Softwood Lumber From Canada (WT/DS236); to be referred to as “Softwood Lumber III.” This dispute was not appealed, and the AB thus did not have the opportunity to provide its view on the issues raised in the dispute. The fundamental character of several of the issues at stake in both these disputes makes the AB's determination in Softwood Lumber IV particularly interesting.

The Panel in Softwood Lumber IV – “the Panel” if not stated otherwise – saw itself as facing seven claims by Canada:

1. (1) The United States Department of Commerce (USDOC) erred in determining that “stumpage” is a financial contribution in the form of the provision of a good by provincial governments.

2. (2) The USDOC erred in finding that the Canadian provincial stumpage programs confer a benefit.

3. (3) Even if stumpage does provide subsidies, the USDOC erred in not conducting a pass-through analysis in determining subsidization of softwood lumber in the case of certain upstream transactions for inputs.

4. (4) The USDOC failed to determine that the programs are specific subsidies within the meaning of Art. 2 of the Agreement on Subsidies and Countervailing Measures (SCM).

5. (5) The USDOC inflated the subsidy amount by using an inaccurate factor to convert the US log measurements into cubic meters.

6. […]