WORLD TRADE  
ORGANIZATION  WT/DS257/18 
18 January 2005 
 
 (05-0217) 
 Original:   English 
  
 
UNITED STATES – FINAL COUNTERVAILING DUTY DETERMINATION 
WITH RESPECT TO CERTAIN SOFTWOOD LUMBER FROM CANADA 
 
Understanding between Cana da and the United States
 
Regarding Procedures under Articles 21 and 22 of the DSU  
 
  The following communication, dated 14 January  2005, from the delegation of Canada and the 
delegation of the United States to the Chairperson of the Dispute Settlement Body, is circulated at the request of these delegations. 
 
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  Canada and the United States would like to in form the Dispute Settlement Body that they 
have agreed on the attached "Agreed Procedures Un der Articles 21 and 22 of the Dispute Settlement 
Understanding Applicable to the WTO Dispute:  United States – Final Countervailing Duty 
Determination with Respect to Certain Softwood Lumber from Canada  (WT/DS257)". 
  We ask that you please circulate this notification to the Dispute Settlement Body. WT/DS257/18 
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 Agreed Procedures under Articles 21 and 22
 
of the Dispute Settlement Understanding  
Applicable to the WTO Dispute:  
United States – Final Countervailing Duty Determination  
with Respect to Certain Softwood Lumber from Canada  (WT/DS257)  
 
  The Panel and Appellate Body reports in this dispute were adopted by the Dispute Settlement 
Body ("DSB") on 17 February 2004.  
 On 30 April 2004, pursuant to Article 21.3(b) of the DSU, Canada and the United States 
reached an agreement (WT/DS257/13) on a reasonable period of time for implementation of the DSB's recommendations and rulings of ten months ( i.e., from 17 February 2004 to 
17 December 2004).  
 On 17 December 2004, the United States informed the DSB that it had implemented the 
DSB's recommendations and rulings.  On 30 Decem ber 2004, Canada informed the DSB that it 
considers that the United States has not properly implemented these recommendations and rulings.  
  Canada and the United States (the "Parties" ) have agreed on the following procedures: 
 
1. Canada will request the establishment of a pa nel pursuant to Article 21.5 of the DSU (the 
"compliance panel") at a special DSB meeting on 14 January 2005.  The United States will accept the establishment of the compliance panel. 
 2. At the DSB meeting of 14 January 2005, Cana da will also request authorization to suspend 
concessions or other obligations pursuant to Article  22.2 of the DSU.  Pursuant to Article 22.6 
of the DSU, the United States will object to th e level of suspension of concessions or other 
obligations, thereby referring th is matter to arbitration.  
 3. Canada and the United States will cooperate to  enable the compliance panel to circulate its 
report within 90 days of the referral of the matter to the compliance panel, excluding such 
time as the compliance panel's work may be susp ended pursuant to Article 12.12 of the DSU. 
 4. In case of an appeal of the compliance panel report, the Parties will cooperate to enable the 
Appellate Body to circulate its report within 90  days from the date of notification of the 
appeal to the DSB. 
 
5. The Parties will request that the Article 22. 6 arbitration be suspended until adoption by the 
DSB of the recommendations and rulings in the Article 21.5 compliance proceedings. 
 6. In the event that the DSB finds that th e United States has failed to comply with the 
recommendations and rulings of the DSB or that the measures taken by the United States to 
comply with the recommendations and rulings of  the DSB are inconsistent with the covered 
agreements, the Article 22.6 arbitration will resume at the request of either Party.  The Parties 
will cooperate to enable the arbitrators to circulate their report within 60 days of the 
resumption of their work. 
 
7. In the event that the DSB finds that the Un ited States has complied with the recommendations 
and rulings of the DSB and that the measures ta ken by the United States to comply with the 
recommendations and rulings of the DSB are not inconsistent with th e covered agreements, 
Canada will withdraw its request under Article  22.2 of the DSU, thereby terminating the 
arbitration procedure.  WT/DS257/18 
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8. The Parties will cooperate to facilitate the pa rticipation of the orig inal panelists in the 
compliance panel and the Article 22.6 arbitration. 
 9. If any of the original panelists are not av ailable for either the compliance panel or the 
Article 22.6 arbitration, or both, the Parties will promptly consult on a replacement panelist 
and either Party may request the Director-General of the WTO to appoint, as soon as possible, a replacement for the proceeding or proceedings in  which such a replacement is required.  If 
an original panelist is unavailable to serve  on the compliance panel and the Article 22.6 
arbitration, the Parties will further request that in selecting a panelist for the compliance 
panel, the Director-Gener al seek a person who will also be available to act in the Article 22.6 
arbitration. 
 10. The Parties agree to continue to cooperate in all matters related to these agreed procedures 
and not to raise any procedural objection to any of the steps set out in them.  If during the 
application of these procedures, the Parties cons ider that a procedural aspect has not been 
properly addressed, they will endeavour to find a solution within the shortest time possible 
that will not affect the other agreed procedures. 
 11. These agreed procedures do not prejudice either Party's rights to take any action or procedural 
step to protect its rights or interests, including the activation of any aspect of the provisions of 
the DSU. 
 Geneva, 14 January 2005   For Canada: For the United States: 
 
    (signed) (signed)  H.E. Mr Don Stephenson H.E. Ms Linnet F. Deily 
 Ambassador Ambassador 
 Permanent Mission of Canada Permanent Mission of the United States   
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