OTTAWA -- An intensive new stage in the multibillion-dollar softwood lumber dispute with the United States begins today with the release of a ruling that experts don't expect will do much for Canada's interests.
The NAFTA dispute-panel ruling, which is binding on both parties, may favour Washington's arguments for slapping an anti-dumping duty of more than eight per cent on Canadian softwood imports.
That would be a blow to the domestic industry's morale, even though it recently won a related case at the World Trade Organizaton, an industry expert says.
"I don't think a lot of people on the Canadian side are putting a lot of hope in winning as clear a victory this time as we did" at the WTO in May, said Carl Grenier of the Montreal-based Free Trade Lumber Council.
"We may hear some interesting technical points, but I don't think anyone expects a clear ruling that says 'There's no dumping.'"
The ruling, the first in a series due from the NAFTA panel, also marks the beginning of an intensified stage in the two-year-old trade war because decisions under NAFTA are considered more influential than those from the WTO, experts say.
"These are binding rulings . . . so we're getting down to the core of decisions that matter," said Sebastian Theberge, spokesman for Trade Minister Pierre Pettigrew.
NAFTA panels are considered part of the judicial system with an impact similar to that of a court.
"Ultimately, the NAFTA rulings are more important to us than the WTO rulings because they have force of law in the U.S.," said Grenier.
"If you win under NAFTA, the panel tells . . . the Department of Commerce or the International Trade Commission that they have to change this or that. Whereas, if you win at the WTO the country in question -- in this case, the U.S. -- can always find a way out."
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