CIIT Committee Meeting

The Standing Committee on International Trade met at 3:38 p.m. this day, in Room 701, La Promenade Building, the Chair, Leon Benoit, presiding.

Gordon Ritchie, Pierre Monahan, Barry Rutenberg, Francis Schiller, Martin Béland, Roger Falconer, John Rolland and Luc Dufour made statements and answered questions.

At 5:16 p.m., the sitting was suspended.

At 5:20 p.m., the sitting resumed.

Pierre A. Paquette moved, — The Standing Committee on International Trade heard testimony regarding the agreement in principle on softwood lumber concluded by Canada and the United States on April 27, 2006.

Based on the testimony heard, the Committee on International Trade recommends that the Government:

1- Take the time needed to conclude a final agreement that meets the expectations of the Canadian softwood lumber industry, since it will be in effect for 7 to 9 years;

2- Uphold Canada’s legal victories before NAFTA tribunals and ensure that the agreement does not include any reference to the American allegations of presumed subsidies to the Canadian industry and harm to the American industry;

3- Ensure that the anti-circumvention clause is worded so it preserves the provinces’ ability to amend and enhance their forestry policy without the risk of American reprisals;

4- Ensure that under option B, which stipulates export taxes and export ceilings, the ceiling is not so rigid as to prevent companies from obtaining and honouring major contracts in the United States. A flexible ceiling could be provided in various ways: carry forward of unused part of a quota to the next period; possibility of exceeding the quota by “borrowing” from future periods;

5- Ensure that under option A, the Canadian industry is not excessively penalized for sudden and temporary increases in softwood lumber exports to the United States. In this case also, the necessary flexibility could be provided in various ways;

6- Take every measure to ensure that Canadian companies receive with interest their due share of countervailing and anti-dumping duties within 90 days of the conclusion of the agreement and not of its coming into force. Without this commitment from the American authorities, the Government should present a loan guarantee program, covering all the amounts owed to the companies. The Committee reiterates that, for the purposes of a general audit, loan guarantees are not regarded as an expenditure.

7- Be extremely vigilant in obtaining an effective mechanism to resolve disputes over the interpretation of the agreement.

8- Ensure that if, for technical reasons (computer system not yet ready, for instance), regions that chose option B must be subject to option A, these regions are not required to pay the tax levels stipulated under option A but rather those under option B.

That this motion be tabled in the House as the Committee’s report within the next 24 hours. .

Debate arose thereon.

Helena Guergis moved, — To add on the fifth line after the words ''Based on'' the following words ''some of''.

After debate, the question was put on the amendment of Helena Guergis and it was negatived, by a show of hands: YEAS: 4; NAYS: 7.

Helena Guergis moved, — That the last paragraph be amended by replacing the words ''That this motion be tabled in the House as the Committee's report within the next 24 hours.'' and be replaced by the following words ''That this motion be tabled in the House as the Committee' INTERIM report until such a time as full and balanced report can be prepared.''.

Debate arose thereon.

At 5:34 p.m., the Committee adjourned to the call of the Chair.