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Ontario Satisfied With Softwood Lumber Decision

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Ontario Satisfied With Softwood Lumber Decision

McGuinty Government Pleased With International Ruling On Softwood Exporters

Ontario is pleased with an international tribunal's decision to limit an additional export tax on Ontario softwood lumber to only one-tenth of a per cent (0.1 per cent). This is dramatically lower than the 20 per cent the U.S. had originally requested. The tribunal rejected many of the United States' claims and found that Ontario's forestry programs had no significant adverse impact on U.S. producers.

A London Court of International Arbitration Tribunal operating under the dispute settlement provisions of the 2006 Softwood Lumber Agreement (SLA) ruled the additional tax will be added to softwood lumber exports from Ontario. The U.S. had claimed a violation of the SLA because Ontario implemented certain pre-existing forest sector programs that took the form of grants, loan guarantees or other assistance.

Ontario continues to take strategic actions to diversify the forest sector and reduce its dependency on the U.S. market.

Quick Facts

  • This is one of three arbitration requests filed by the U.S. since the Softwood Lumber Agreement came into force in October 2006.
  • The dispute was heard in Ottawa in July 2009. Follow-up briefs from both parties were provided to the tribunal.
  • The Forest Access Roads Program, the Forest Sector Prosperity Fund and the Forest Sector Loan Guarantee are the three Ontario programs that were in question for a technical violation of the SLA. However the tribunal found only two programs were in any violation and that the impact of these violations was insignificant.
  • The tribunal's decision is final and cannot be appealed. The SLA is scheduled to expire in 2013.

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“Ontario is pleased with today's arbitration decision. We fought hard to defend Ontario's programs and clearly the tribunal agreed that they provided no significant threat to U.S. producers. We look forward to a prosperous future for the sector.”

Michael Gravelle

Minister of Northern Development, Mines and Forestry

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