Canada takes US to WTO in vast trade complaint

[Shahzaz ud din]

Canada takes US to WTO in vast trade complaint
AFP | Published — Wednesday 10 January 2018

Trucks headed for Windsor, Ont., exit onto the lane toward the Ambassador Bridge in Detroit in April. Canada has filed a broad trade complaint with the World Trade Organization against the United States. (Reuters)

GENEVA: Canada has launched a vast dispute against its southern neighbor before the World Trade Organization, accusing Washington of breaching dozens of international trade rules, according to a document published Wednesday.
In a filing to the WTO dated December 20, but only published Wednesday, Canada requested so-called “consultations” with the United States over its use of anti-dumping and countervailing duties.
Washington frequently slaps such punitive tariffs on imports it deems are subsidised or otherwise priced in a way that leads to unfair competition, including announcing late on Tuesday charges of up to 10 percent on paper used to print newspapers and books.
These duties are permitted under international trade rules as long as they adhere to strict conditions, and disputes over their use are often brought before the WTO’s Dispute Settlement Body.
The Canadian complaint pointed to a slew of US “measures relating to anti-dumping or countervailing duty investigations, reviews or other proceedings, which are inconsistent with its WTO obligations.”
In its complaint, Ottawa listed more than 100 examples of wrongdoings it alleged that Washington had committed in its dealings not only with Canada but also with a long line of other trade partners, including China, India, Japan, Mexico, South Africa and the European Union.
Among other things, the document reiterated a long-running Canadian complaint over US anti-dumping duties imposed on Canadian softwood lumber imports.
Washington reacted angrily to the filing.
“Canada’s new request for consultations at the WTO is a broad and ill-advised attack on the US trade remedies system,” US Trade Representative Robert Lighthizer said in a statement.
“US trade remedies ensure that trade is fair by counteracting dumping or subsidies that are injuring US workers, farmers, and manufacturers,” he said, insisting that “Canada’s claims are unfounded and could only lower US confidence that Canada is committed to mutually beneficial trade.”
He stressed that if the United States removed the duties listed in the Canadian complaint, “the flood of imports from China and other countries would negatively impact billions of dollars in Canadian exports to the United States.”
Canadian exports of steel and alumium products would take a $9.0 billion hit, while its wood and paper product exports would shrink by $2.5 billion, the statement said.
“Canada’s claims threaten the ability of all countries to defend their workers against unfair trade,” Lighthizer said, insisting that “Canada’s complaint is bad for Canada.”
Canada’s request for consultations marks the first step in the WTO dispute system, and is aimed at giving the parties a chance to talk things through and resolve their differences without moving forward with litigation.
If the consultations fail to resolve the dispute within 60 days, the WTO can create a panel of experts to review the case.
Canada is also embroiled in tense talks with the United States to amend the North American Free Trade Agreement (NAFTA), which President Donald Trump demanded be renegotiated to get a better deal for US businesses and consumers.

 

[Zibago]

US will defy orders of WTO now Trump has zero concern for America,s standing in the global community he still thinks that no one has the capacity to say no to US if you bully them

 

[Bilal9]

US will defy orders of WTO now Trump has zero concern for America,s standing in the global community he still thinks that no one has the capacity to say no to US if you bully them

This whole fiasco started when Bombardier tried to sell new efficient passenger jets in the US which undercut Boeing's 737 business. This may be a portent of bad things to come (tit-for-tat action), maybe even a trade war between Canada and US.

------------------------------------------------------------------------
US upholds 300% duties on disputed Bombardier jets, a win for Boeing

• A final decision is expected by February.
• Bombardier intends to make the jets in Alabama.
• Delta last year agreed to buy at least 75 C Series jets from Bombardier.

Leslie Josephs | @lesliejosephs
Published 3:17 PM ET Wed, 20 Dec 2017 Updated 10:04 PM ET Wed, 20 Dec 2017 CNBC.com

The U.S. Commerce Department on Wednesday finalized duties of nearly 300 percent on passenger jets made by Bombardier, a win for Boeing, which lodged the complaint against its Canadian rival.

The decision escalates the bitter trade dispute between the two air craft manufacturers, a battle that has ensnared one of the largest U.S. airlines and strained relations between the U.S. and Canada.

The Commerce Department first recommended the duties on Bombardier's CSeries jets, earlier this autumn after Boeing complained that the planes were dumped in the U.S. below cost and that the company received unfair government subsidies in Canada.


Bombardier said the Commerce Department did not consider a common practice of airplane manufacturers in which they offer discounts to launch customers.

"Unfortunately, the Commerce Department decision is divorced from this reality and ignores long-standing business practices in the aerospace industry, including launch pricing and the financing of multibillion dollar aircraft programs," the company said in a statement. "Moreover, we are deeply disappointed that the Commerce Department did not take this opportunity to rectify its past errors."

Delta Air Lines in 2016 agreed to buy at least 75 of the some 100-seat planes from Bombardier.

In October, European aerospace giant Airbus, Boeing's chief rival, said it would take a majority stake in the CSeries program, in a twist.

The U.S. International Trade Commission is scheduled to make a determination by Feb. 1 if Boeing was harmed by Bombardier's actions, a decision that will determine whether the investigation will be terminated.

Delta CEO Ed Bastian has repeatedly said the airline won't pay the tariffs and called the duties "absurd." Spokesman Morgan Durrant reiterated the final say on the matter will come in early 2018 when the ITC makes its decision, but declined to comment further.

The airline has not taken delivery of the C Series jets yet, so it has not been subjected to the tariffs. Delta, the second-largest U.S. airline, said it opted for the Bombardier jets because Boeing offered it no feasible alternative.

Boeing cheered the Commerce Department's decision on Wednesday.

"Today's decision validates Boeing's complaints regarding Bombardier's pricing in the United States, pricing that has harmed our workforce and U.S. industry," the company said in a statement. "We look forward to the conclusion of this matter when the International Trade Commission makes a final decision in early 2018."

In an effort to escape what could be crippling import duties, Bombardier has said it intends to build the planes in Alabama, where its newfound partner Airbus produces single-aisle jets.

But that arrangement didn't appear to be taken into account. The Commerce Department's statement on Wednesday said that Bombardier, petitioners and the government of Canada agreed that the proposed arrangement "does not impact these investigations."

Earlier this month Canada's government ditched plans to buy 18 new Super Hornet fighter jets made by Boeing. In September, Prime Minister Justin Trudeau had threatened not to buy the jets from Boeing unless it dropped its suit against Bombardier.