CIIT Committee Meeting

The Standing Committee on International Trade met at 3:45 p.m. this day, in Room 308, West Block, the Chair, Leon Benoit, presiding.

On motion of Dominic LeBlanc, it was agreed, — That the Agenda of the Committee for today's meeting be amended for the beginning of the meeting to resume on the Softwood Lumber study, specifically the votes on the motion of Pierre Paquette and the amendments of Helena Guergis.

On the motion of Pierre Paquette, — 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 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.

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, — Whereas it may be the will of the Committee to table a report on the matter of the issues facing the softwood lumber industry without taking into consideration the testimony of the witnesses appearing before Committee on Monday, June 19, 2006 the committee moves:

That interested Members of the Committee be prepared to append supplementary comments to the main report within 48 hours of the final adoption of the Committee report..

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, — Whereas the Committee has not had an opportunity to complete the testimony and provide research staff with drafting instructions or parameters for the drafting of a report on the softwood lumber industry the committee moves:

That discussion take place to provide staff with parameters and guidelines for the drafting of the report; a deadline for which to complete the report and the major components that are to be addressed within the context of the testimony of the witnesses heard by the Committee.

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.

Peter Julian moved, — That the government provide all members of the Standing Committee on International Trade with all impact studies performed by Industry Canada on the consequences of a free trade deal with South Korea on the automotive and shipbuilding sectors, within thirty days.

Debate arose thereon.

After debate, the question was put on the motion and it was agreed to, by a show of hands: YEAS: 7; NAYS: 4.

On motion of Helena Guergis, it was agreed, — That the senior officials be permitted to leave and be reinvited for a subsequent meeting next fall.

On motion of Dominic LeBlanc, it was agreed, — That the Canadian Council for International Cooperation and Raùl Moreno be the first to present their brief.

Raúl Moreno, Rusa Jeremie, Merrill Harris, Sandra Marsden and Andrew Young made statements and answered questions.

At 5:33 p.m., the Committee adjourned to the call of the Chair.