. /.  WORLD TRADE  
ORGANIZATION  WT/DS264/17 
20 May 2005 
 
 (05-2049) 
 Original:   English 
  
 
UNITED STATES – FINAL DUMPING DETERMINATION ON 
SOFTWOOD LUMBER FROM CANADA 
 
Recourse to Article 22.2 of the DSU by Canada
 
 
 
 The following communication, dated 19 May 2005, from the delegation of Canada to the Chairman of the Dispute Settlement Body, is circulated pursuant to Article 22.2 of the DSU.  
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 Canada requests that a special meeting of th e Dispute Settlement Body (DSB) be held on 
1 June 2005 to consider the following agenda item:  
 United States – Final Dumping Determination on Softwood Lumber from Canada 
 
 Recourse by Canada to Article 22.2 of the Understanding on Rules and Procedures 
Governing the Settlement of Disputes 
 
On 31 August 2004, the Dispute Settlement Body  ("DSB") adopted the Panel and Appellate 
Body reports in United States – Final Dumping Determination on Softwood Lumber from Canada .
1  
The panel and Appellate Body found that the United States acted "inconsistently with Article 2.4.2 of 
the Anti-Dumping Agreement  in determining the existence of dumping on the basis of a methodology 
incorporating the practice of ‘zeroing'".2  The panel and the Appellate Body recommended that the 
United States bring its measure into conf ormity with its obligations under the Agreement on 
Implementation of Article VI of th e General Agreement on Tariffs and Trade  ("Anti-Dumping 
Agreement "). 
 
 On 6 December 2004, Canada and the United States reached agreement on a "reasonable period of time" to comply with the recommend ations and rulings of the DSB pursuant to 
Article 21.3(b) of the Understanding on Rules and Procedures Go verning the Settlement of Disputes 
("DSU ").
3  The United States confirmed in this agreem ent that it would complete implementation no 
later than 15 April 2005.  On 14 February 2005, Ca nada and the United States agreed to extend the 
"reasonable period of time" until no later than 2 May 2005.4 
 
                                                      
1 Dispute Settlement Body, Minutes of Meeting (31 August 2004) , WT/DSB/M/175, 24 September 
2004, at para. 4. Also see United States – Final Dumping Determination on Softwood Lumber from Canada , 
Report of the Appellate Body, WT/DS 264/AB/R, adopted 31 August 2004 and United States – Final Dumping 
Determination on Softwood Lumber from Canada , Report of the Panel, WT/DS264/R, adopted 31 August 2004. 
2 Appellate Body Report, at para. 183(a); and Panel Report, at para. 8.1(a)(i).   
3 United States – Final Dumping Determination on Softwood Lumber from Canada, Agreement under 
Article 21.3(b) of the DSU , WT/DS264/12, 8 December 2004.   
4 United States – Final Dumping Determination on Softwood Lumber from Canada, Agreement under 
Article 21.3(b) of the DSU , WT/DS264/15, 17 February 2005.   WT/DS264/17 
Page 2  
 
  The United States has failed to comply with  the DSB's recommendations and rulings within 
the reasonable period of time provided.  Therefore, pursuant to Article 22.2 of the DSU , Canada 
requests authorization from the DSB to suspend the application to the United States of concessions or 
other obligations, in an amount representing the portion of the total anti-dumping duties illegally 
collected and not refunded as a result of the United States' non-compliance ( i.e., the United States' 
failure to eliminate the practice of zeroing).  Through 2005, this amount  will be approximately 
$CAD 400 million.  For the year 2005, the level of suspension of concessions should therefore equal 
this amount.  In each subsequent year, the level of  suspension of concessions will equal the portion of 
the total anti-dumping duties illegally collected and not refunded for that year as a result of the United States' non-compliance. 
 
 This level of suspension of concessions is equivalent to the level of nullification and 
impairment of benefits accruing to  Canada that results from the US failure to bring its measures into 
compliance with Anti-Dumping Agreement or to otherwise comply with the recommendations and 
rulings of the DSB. 
 
 Canada intends to implement this suspension of tariff concessions a nd related obligations 
under the General Agreement on Tariffs and Trade 1994  by imposing additional import duties above 
bound custom duties on products originating in the United States.  For each year in which Canada 
intends to take such measures, Canada will provide  the DSB with a final list indicating the level of 
additional duties that Canada will apply and the produc ts that will be subject to the additional duties.  
 
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