The federal Liberals have put the White House on notice that Canada will officially challenge the legality of an American decision to hike duties on softwood lumber heading south of the border.
The government is filing the grievance under the recently renewed North American free trade pact.
Trade Minister Mary Ng said in a statement that she expects Canada to be successful, as it has been in previous challenges to what she calls unwarranted duties on Canadian lumber.
She added that the extra costs are likely to hit American homebuyers and homeowners hardest, saying the duties are also a tax on U.S. consumers that will raise construction and renovation costs.
Late last month, the U.S. government nearly doubled the tariffs on Canadian softwood lumber as part of a long-running dispute that stems from the U.S. industry’s belief that their northern counterparts get help from the federal government.
The Liberals have been under fire from opposition parties for not preventing the new round of tariffs, particularly given expectations that trade disputes would dissipate with Joe Biden in the White House rather than Donald Trump, with his protectionist policies.
The government had hinted it was prepared to impose countervailing measures, or take a more formal stance in challenging the duties under the Canada-United States-Mexico Agreement.
Ng said the government remains interested in negotiating a settlement to the trade issue, but decided to go the route of a trade challenge in the absence of any movement from the Americans.
Susan Yurkovich, president of the B.C. Lumber Trade Council, applauded the government’s decision to challenge the American duties that she said remain a threat to an economic recovery on both sides of the border.
—The Canadian Press