UNITED STATES – INVESTIGATION OF THE INTERNATIONAL TRADE COMMISSION IN SOFTWOOD LUMBER FROM CANADA
Document: Notification of Mutually Agreed Solution Addendum
Date: 9 March 2007
Document codes: WT/DS277/20/Add.1; G/L/598/Add.2; G/ADP/D45/2/Add.1; G/SCM/D51/2/Add.1
Complainant: Canada
Respondent: U.S.
Third parties: China, EU, Japan, South Korea
Dispute stage: Mutually Agreed Solution
Agreements cited: Art. VI:6  GATT 1994Art. 1, 3.1, 3.2, 3.3, 3.4, 3.5, 3.7, 3.8, 12, 18.1  Anti-dumpingArt. 10, 15.1, 15.2, 15.3, 15.4, 15.5, 15.7, 15.8, 22, 32.1  Subsidies and Countervailing Measures (SCM)

French

UNITED STATES – INVESTIGATION OF THE INTERNATIONAL
TRADE COMMISSION IN SOFTWOOD LUMBER FROM CANADA

Notification of Mutually Agreed Solution

Addendum

 The following communication, received on 23 February 2007, from the delegation of the
United States and the delegation of Canada to th e Chairman of the Dispute Settlement Body, is
circulated pursuant to Article 3.6 of the DSU.

United States – Preliminary Determinations with respect to
Certain Softwood Lumber from Canada (DS236);

United States – Provisional Anti-Dumping Measure
on Imports of Certain Softwood Lumber from Canada (DS247);

United States – Final Countervailing Duty Determination
with respect to Certain Softwood Lumber from Canada (DS257);

United States – Final Dumping Determination on Softwood Lumber
from Canada (DS264);

 (DS277); and

United States – Reviews of Countervailing Duty on Softwood Lumber
from Canada (DS311).

 On 12 October 2006, the Governments of Cana da and the United States notified the Dispute
Settlement Body (DSB) that we had reached a mutu ally agreed solution to the matters raised by
Canada in the above-referenced disputes in the form of a comprehensiv e agreement signed on
12 September 2006 (the original Agreement), which we a ttached to our notification. This letter is to
advise the DSB that, on 12 October 2006, Canada and the United States concluded a further
Agreement, which amended the original Agreement to facilitate its entry into force. We have attached
a copy of the amending Agreement for the information of Members.

AGREEMENT

BETWEEN

THE GOVERNMENT OF CANADA

AND

THE GOVERNMENT OF THE UNITED STATES OF AMERICA

AMENDING THE SOFTWOOD LUMBER AGREEMENT

BETWEEN

THE GOVERNMENT OF CANADA AND

THE GOVERNMENT OF THE UNITED STATES OF AMERICA

DONE AT OTTAWA ON 12 SEPTEMBER 2006

THE GOVERNMENT OF CANADA AND THE GOVERNMENT OF THE UNITED STATES
OF AMERICA,

HAVING signed the Softwood Lumber Agreement betw een the Government of Canada and the
Government of the United States of America, at Ottawa on 12 September 2006 ("the SLA 2006"),

DESIRING to amend Articles II through IV and Articl e X of the SLA 2006 Agreement, and make
consequential changes to the Anne xes associated with these Articles, pursuant to Article XIX of the
SLA 2006,

HAVE AGREED as follows:

ARTICLE I

Article II(1)(a) of the SLA 2006 shall be deleted and replaced by the following:

"(a) the Settlement of Claims Agreement in Annex 2A has been signed by counsel
on behalf of the parties set out therein;"

ARTICLE II

Article II(1)(c) of the SLA 2006 shall be deleted and replaced by the following:

"(c) the United States is not enjoined by court order from revoking the AD Order
or the CVD Order;"
WT/DS277/20/Add.1, G/L/598/Add.2,
 G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

ARTICLE III

Article II(1)(e) of the SLA 2006 shall be deleted and replaced by the following:

"(e) Canada and the United States have confirmed that all those Importers of
Record that have elected to be Escrow Im porters as of the day prior to the Effective
Date have complied with all the requirements in paragraph 1 of Annex 2C;"

ARTICLE IV

The chapeau of Article III(2) of the SLA 2006 shall be deleted and replaced by the following:

"2. On the Effective Date, or no later than 3 days after the Effective Date,
USDOC shall instruct USCBP, as set out in Annex 3A
*, to:
* The Parties understand that, should a court of competent jurisdiction enjoin the liquidation of
entries that would otherwise be subject to the liquidation instructions contained in Annex 3A,
USDOC shall amend the instructions to reflect that court’s order."

ARTICLE V

Article III(2)(b) of the SLA 2006 shall be deleted and replaced by the following:

"(b) except with respect to entries the li quidation of which is enjoined, liquidate
all Covered Entries made on or afte r May 22, 2002 without regard to
antidumping or countervailing duties a nd refund all deposits collected on
such entries with all accrued interest pursuant to 19 U.S.C. § 1677g(b) to the
Importers of Record or their designates. No later than 3 days after a court of
competent jurisdiction has modified any injunction against liquidation to
permit liquidation and the return of de posits to Importers of Record or
confirmed that liquidation is not incons istent with such injunction, USDOC
shall instruct USCBP, as set out in Annex 3B, to liquidate the entries that
were subject to that injunction in accordance with paragraph 8 of Annex 2C."

ARTICLE VI

Article III of the SLA 2006 shall be amended by adding paragraph 3 as follows:

"3. With respect to Covered Entries subj ect to an injunction against liquidation
for antidumping purposes, after a suspension of liquidation for CVD purposes with
respect to such entries has been removed, the United States shall, unless otherwise
ordered by a court of competent jurisdiction, act in accordance with the view that the
6 month period specified in 19 U.S.C. § 1504(d) does not begin until USCBP receives
notice of the lifting of the injunction, unless an extension request under 19 U.S.C. §
1504(b) and 19 C.F.R. § 159.12 is applicable."
WT/DS277/20/Add.1, G/L/598/Add.2,
G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

ARTICLE VII

Article IV(1) of the SLA 2006 shall be deleted and replaced by the following:

"1. Within 10 days after the Effective Date, the United States shall begin to
liquidate all Covered Entries made on or af ter May 22, 2002, except with respect to
entries the liquidation of which is enjoined
**, without regard to antidumping or
countervailing duties, and with interest pur suant to 19 U.S.C. § 1677g(b). Within
10 days after a court of competent jurisdiction has modified any injunction against
liquidation to permit liquidation and the return of deposits to Importers of Record or
confirmed that liquidation is not inconsistent with such injunction, the United States
shall begin to liquidate the entries that we re subject to the injunction in accordance
with paragraph 8 of Annex 2C.
**Liquidation of such entries is addressed in paragraph 2(b) of Article III."

ARTICLE VIII

Article IV(2) of the SLA 2006 shall be deleted and replaced by the following:

"2. Except with respect to entries th e liquidation of which is enjoined, *** the
United States shall complete the liquidation of Covered Entries and the refund of all
cash deposits as soon as possible, but not late r than 6 months after the publication in
the Federal Register of the revocations referred to in Article III unless these entries
are subject to an extension request under 19 U.S.C. § 1504(b) and 19 C.F.R. § 159.12.
***Liquidation of such entries is addressed in paragraph 2(b) of Article III."

ARTICLE IX

Article X(2)(a) of the SLA 2006 shall be deleted and replaced by the following:

"(a) except for 9157-9516 Québec inc. (Sci erie Nord-Sud inc.), a base average
monthly production shall be established for each company in Annex 10
equivalent to its total production of Softwood Lumber Products for 2004 and
2005, divided by 24. For 9157-9516 Québec inc. (Scierie Nord-Sud inc.), a
base average monthly production shall be established that is equivalent to its
total production of Softwood Lumber Products for 2002 and 2003, divided
by 24;"

ARTICLE X

Article X(3) of the SLA 2006 shall be deleted and replaced by the following:

"3. With respect to each company listed in Annex 10, the province in which the
company is located shall provide Canada be fore the Effective Date with a certified
statement attesting to the company’s tota l production of Softwood Lumber Products
for 2004 and 2005. In the case of 9157-9516 Qu ébec inc. (Scierie Nord-Sud inc.),
Québec shall provide Canada before the E ffective Date with a certified statement
WT/DS277/20/Add.1, G/L/598/Add.2,
 G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

attesting to the company’s total produc tion of Softwood Lumber Products for 2002
and 2003. Canada shall provide these statemen ts to the United States within 10 days
of receipt. This information shall not be tr eated as confidential under Article XVI. If
exclusion of a company is limited to one or more mills, "company" in this Article
shall be limited to those one or more mills. The Parties shall cooperate with respect to
monitoring and enforcement, as contemplated in Article XV, in respect of claims of
exclusion under this Article."

ARTICLE XI

Annex 2A of the SLA 2006 shall be deleted and replaced by the attached Annex 2A.

ARTICLE XII

Annex 2B of the SLA 2006 shall be deleted and replaced by the attached Annex 2B.

ARTICLE XIII

Paragraph 2 of Annex 2C of the SLA 2006 shall be deleted and replaced by the following:

"2. USCBP shall provide Canada with information and documentation
demonstrating that USCBP has received the documentation described in sub-
paragraph 1(a) for all Importers of Record that have elected to be Escrow Importers
as of the Effective Date."

ARTICLE XIV

The chapeau of Annex 2C, paragraph 4 of the SLA 2006 shall be deleted and replaced by the
following:

"4. By the Effective Date, the United St ates shall provide Canada or its agent
with information identifying beneficiaries who will establish accounts with respect to
the following:"

ARTICLE XV

Annex 2C, paragraph 5 of the SLA 2006 shall be amended by deleting the phrase "pursuant to the
Irrevocable Directions to Pay".

ARTICLE XVI

Annex 2C, paragraph 6 of the SLA 2006 shall be deleted and replaced by the following:

"6. The United States understands that Ca nada or its agent shall purchase from
the Escrow Importers the rights to the am ount of cash deposits stated in USCBP
records and accrued interest for the Co vered Entries. The purchase price
**** paid to
WT/DS277/20/Add.1, G/L/598/Add.2,
G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

an Escrow Importer shall not exceed the am ount of cash deposits and accrued interest
on its Covered Entries on the purchase date less the amounts directed to the accounts
referenced in paragraph 4. Canada or its agent may make payments in installments in
respect of these purchases. Each Escrow Importer in the Agreements of Purchase and
Sale shall irrevocably direct Canada or its agent to pay a portion of each installment
to the referenced accounts in paragraph 4 in an amount that is proportionate to
$US 1 billion divided by the total amount of cash deposits to be refunded to all
Importers of Record and the interest accrued as of the Effective Date. Payment of
any such portion shall be made on the same day as the installment is paid to the
Escrow Importer.
In particular, Canada or its agent shall en sure that the majority of the amount owing
to the account referenced in paragraph 4(a) is paid within 8 weeks of the Effective
Date provided that, if a longer timeframe is necessary, payments to the account
referenced in paragraph 4(a) shall be ma de as soon as possible and no later than the
same date as payments to the Escrow Importers. Furthermore, to the extent
permissible under the terms of the Agreements of Purchase and Sale and in light of
the fact that the accounts specified in para graphs 4(b) and (c) will require additional
time to be created, payment of all monies due to the account referenced in
paragraph 4(a) shall be completed in adva nce of payments to the accounts referenced
in paragraphs 4(b) and (c).
If, for any reason, the 8 week timeframe needs to be extended, the Parties shall
consult regarding the extension of the time frame required. Such consultations shall
take place within 8 weeks of the Effective Date. A Party may not initiate dispute
settlement proceedings under Article XIV regarding the extension of the above-
mentioned timeframes.
Canada shall pay the difference between $US 1 billion and the aggregate amount
directed by the Escrow Importers into th e accounts referenced in paragraph 4.
Notwithstanding any extension of the 8 week timeframe referenced above, all
payments to the accounts referenced in paragraph 4 shall be completed within
6 months of the Effective Date.
**** Canada or its agent shall assume administra tive costs associated w ith the purchase of the
rights to the amount of cash deposits and accrued interest."

ARTICLE XVII

Annex 2C, paragraph 8 of the SLA 2006 shall be deleted and replaced by the following:

"8. The United States shall liquidate Covered Entries starting with entries that are
or will become more than 4 years old dur ing the first 6 months of the liquidation
process and followed by entries that will b ecome more than 4 years old during any
subsequent extension under 19 U.S.C. § 1504(b) and 19 C.F.R. § 159.12. In addition,
the United States shall liquidate all entries for which liquidation is enjoined by the
CIT in West Fraser v. United States (Consol. Ct. No. 05-00079) within 6 months of
the modification or clarification of the injunctions permitting liquidation of these
entries to proceed, unless th ese entries are subject to an extension request under
19 U.S.C. § 1504(b) and 19 C.F.R. § 159.12. Such liquidation shall proceed
according to the instructions in Annex 3B."
WT/DS277/20/Add.1, G/L/598/Add.2,
 G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

ARTICLE XVIII

Annex 3 of the SLA 2006 shall be deleted and replaced by the attached Annex 3A and Annex 3B.

ARTICLE XIX

Annex 10, item 3 of the SLA 2006 shall be ame nded by replacing "Scierie Coaticook inc." with
"Beaubois Coaticook inc."

ARTICLE XX

This Agreement shall enter into fo rce on the date designated by the Parties for the entry into force of
the SLA 2006.

IN WITNESS WHEREOF, the undersigned, being duly authorized by their respective Governments,
have signed this Agreement.

DONE in duplicate at Ottawa, this 12
th day of October 2006, in the English and French languages,
each version being equally authentic.

FOR THE
GOVERNMENT OF CANADA
FOR THE
GOVERNMENT OF THE UNITED
STATES OF AMERICA
WT/DS277/20/Add.1, G/L/598/Add.2,
G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

ANNEX 2A

SETTLEMENT OF CLAIMS AGREEMENT

1. On the Effective Date of the Softwood Lumb er Agreement 2006, this Settlement of Claims
Agreement (Claims Settlement Agreement) will c onstitute a full and complete settlement of the
claims asserted in the actions referenced in this paragraph. On the Effec tive Date, Canada and the
United States shall file a joint stipulation of dismissal of Canada’s complaint in Canada v. United
States (Ct. No. 05-00033 (CIT)). Further, on the Effective Date:

The United States and Tembec Inc. and its aff iliates shall file a joint stipulation of
dismissal in Tembec et al. v. United States (Civil Action No. 05-2345 (U.S. District
Ct. for the District of Columbia));
the United States shall withdraw its request for an Extraordinary Challenge in Certain
Softwood Lumber Products from Canada , Secretariat File No. ECC-2006-1904-
01USA; and
Canfor Corporation shall withdraw its claim against the United States in The
Consolidated Arbitration Pursuant to Ar ticle 1126 of the North American Free Trade
Agreement (NAFTA) and the UNCITRAL Arbitration Rules between Canfor
Corporation v. United States of America and Terminal Forest Products Ltd. v. United
States of America.
2. In addition, on the Effective Date, Canada a nd the United States shall seek to dismiss the
following actions:

Certain Softwood Lumber Products from Canada (Original AD Investigation) ,
Secretariat File No. USA-CDA-2002-1904-02;
Tembec v. United States (Consol. Ct. No. 05-00028 (CIT)) and the cases consolidated
therein; and
Coalition for Fair Lumber Imports Execu tive Committee v. United States (Civil
Action No. 05-1366 (D.C. Cir.)).
3. The United States shall ensure th at the following actions are taken:

 (a) On the Effective Date, the U.S. Department of Commerce ("USDOC") shall
retroactively revoke the Countervailing Du ty Order regarding Certain Softwood
Lumber from Canada, 67 Fed. Reg. 36, 070 (May 22, 2002), as amended, and the
Antidumping Duty Order regarding Certain Softwood Lumber from Canada, 67 Fed.
Reg. 36,068 (May 22, 2002), as amended (the "Orders"), in their entirety as of
May 22, 2002 without the possibility that they could be reinstated;

 (b) On the Effective Date, USDOC shall term inate all USDOC proceedings related to the
Orders; and

 (c) No later than 3 days after the Effec tive Date, to the extent that USDOC is not
enjoined against providing for liquidation, USDOC shall provide the instructions in
WT/DS277/20/Add.1, G/L/598/Add.2,
 G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

Annex 3A of the SLA 2006 to U.S. Customs and Border Protection to cease
collecting cash deposits and to liquidate entr ies covered by the Orders described in
subparagraph 3(a) without regard to anti dumping or countervailing duties and to pay
interest in accordance with section 778 of the Tariff Act of 1930, as amended.

4. Following the Effective Date, Canada a nd the United States shall continue to seek
modification or clarification of the injunctions in West Fraser v. United States (Consol. Ct. No. 05-
00079 (CIT)) such that the underlying entries may be liquidated without regard to antidumping and
countervailing duties. To the extent that USDOC is not enjoined against providing for liquidation,
USDOC shall provide the instructions in Annex 3B of the SLA 2006, as amended, to USCBP at such
time as the U.S. Court of International Trade modifi es or clarifies the injunctions against liquidation
issued in West Fraser v. United States to permit the United States to liquidate entries covered by the
first AD administrative review, the liquidation of which had been enjoined.

5. As promptly as possible after the Effective Date , Canada and the United States shall file joint
motions to dismiss the following actions, if they have not been dismissed already, on the grounds of
mootness:

Certain Softwood Lumber Products from Canada (CVD 1
st Administrative Review) ,
Secretariat File No. USA-CDA-2005-1904-01; and
West Fraser v. United States (Consol. Ct. No. 05-00079 (CIT)).
6. For purposes of paragraphs 7 through 10, Certain Softwood Lumber Products from Canada
(Original CVD Investigation ), Secretariat File No. USA-CDA-2002-1904-03 shall be treated in the
same manner as an "action referenced in this Claims Settlement Agreement".

7. Canada and the United States shall request dism issal of any new lawsuits concerning the same
subject matter as any action referenced in this Clai ms Settlement Agreement that are filed before the
date of entry into force of the SLA 2006.

8. No party to this Claims Settlement Agreement shall seek to hold any other party liable to pay
its costs and expenses of litigation relating to any action referenced in this Claims Settlement
Agreement.

9. This Claims Settlement Agreement is without prejudice to the position of any party to this
Claims Settlement Agreement on any issue in any action referenced in this Claims Settlement
Agreement.

10. Each party to this Claims Settlement Agreemen t shall not re-file any of the actions that are
referenced in paragraph 1 of this Claims Settlement Agreement.

11. This Claims Settlement Agreement may not be altered, amended, m odified, or otherwise
changed other than through the written agreement of all parties hereto.

12. This Claims Settlement Agreement shall bind th e parties, their officers, directors, employees,
predecessors, subsidiaries, heirs, executors, administrators, agents, successors, and assigns.

13. As evidence of their consent to this Claims Settlement Agreement, the parties, through their
duly authorized Representatives, have signed below.
WT/DS277/20/Add.1, G/L/598/Add.2,
G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

14. This Claims Settlement Agreement may be ex ecuted in counterparts, each one of which shall
be deemed an original and all of which together shall constitute one and the same Claims Settlement
Agreement.

By: _________________________ Dated: ______, 2006

M. Jean Anderson
Weil, Gotshal & Manges, LLP
1300 Eye Street, NW.
Suite 900
Washington, DC 20005

Counsel for the Government of Canada in all the referenced proceedings other than Tembec et al. v.
United States (Civil Action No. 05-2345 (U.S. District Ct. for the District of Columbia)) and the
Consolidated Arbitration Pursuant to Article 1126 of the North American Free Trade Agreement
(NAFTA) and the UNCITRAL Arbitration Rules between Canfor Corporation v. United States of
America and Terminal Forest Products Ltd. v. United States of America

By: _________________________ Dated: ______, 2006
Seth P. Waxman
Wilmer, Cutler, Pickering, Hale & Dorr, LLP
1875 Pennsylvania Avenue, NW.
Washington, DC 20006-3642

Counsel for the Government of Canada in Coalition for Fair Lumber Imports Executive Committee v.
United States (Civil Action No. 05-1366 (D.C. Cir.))

By: _________________________ Dated: ______, 2006
Reginald T. Blades, Jr.
U.S. Department of Justice
Commercial Litigation Branch - Civil Division
1100 L Street, NW.
8th Floor
Washington, DC 20530

Counsel for the United States in W est Fraser v. United States (Consol. Ct. No. 05-00079 (CIT)) and
the cases consolidated therein
WT/DS277/20/Add.1, G/L/598/Add.2,
 G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

By: _________________________ Dated: ______, 2006
Stephen C. Tosini
U.S. Department of Justice
Commercial Litigation Branch - Civil Division
1100 L Street, NW.
Room 12020
Washington, DC 20530

Counsel for the United States in Tembec v. United States (Consol. Ct. No. 05-00028
(CIT)) and the cases consolidated therein

By: _________________________ Dated: ______, 2006
Alexander Kenneth Haas
U.S. Department of Justice
20 Massachusetts Avenue, NW
Washington, D.C.

Counsel for the United States in Tembec et al. v. United States (Civil Action No. 05-2345 (U.S.
District Ct. for the District of Columbia))

By: _________________________ Dated: ______, 2006
Douglas N. Letter
Litigation Counsel
U.S. Department of Justice
Civil Division, Appellate Staff
950 Pennsylvania Avenue N.W.
Room 7513
Washington, D.C. 20530-0001

Counsel for the United States in Coalition for Fair Lumber Imports Executive Committee v. United
States (Civil Action No. 05-1366 (D.C. Cir.))

By: _________________________ Dated: ______, 2006
John D. McInerney
U.S. Department of Commerce
14
th & Constitution Avenue, N.W.
Room 3622
Washington, D.C. 20230

Counsel for United States Department of Commerce in Certain Softwood Lumber
Products from Canada (Original AD Investigation), Secretariat File No. USA-CDA-
2002-1904-02; Certain Softwood Lumber Products from Canada (Original CVD
Investigation), Secretariat File No. USA-CDA-2002-1904-03; Certain Softwood Lumber Products
from Canada (CVD 1
st Administrative Review), Secretariat File No. USA-CDA-2005-1904-01
WT/DS277/20/Add.1, G/L/598/Add.2,
G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

By: _________________________ Dated: ______, 2006
Andrea J. Menaker
Chief, NAFTA Arbitration Division
Office of the Legal Adviser
U.S. Department of State
Washington, D.C.

Counsel for the United States with respect to the Consolidated Arbitration Pursuant to Article 1126 of
the North American Free Trade Agreement (NAFT A) and the UNCITRAL Arbitration Rules between
Canfor Corporation v. United States of America and Terminal Forest Products Ltd. v. United States
of America

By: _________________________ Dated: ______, 2006
William Busis
Office of the United States Trade Representative
600 – 17
th Street, N.W.
Washington, D.C. 20508

Counsel for the United States in Certain Softwood Lumber Products from Canada,
Secretariat File No. ECC-2006-1904-01USA

By: _________________________ Dated: ______, 2006
Elliot J. Feldman
Baker & Hostetler, LLP
Washington Square, Suite 1100
1050 Connecticut Avenue, NW.
Washington, DC 20036-5304

Counsel for Tembec Inc. and its affiliates

By: _________________________ Dated: ______, 2006
P. John Landry
DAVIS & COMPANY
2800-666 Burrard Street
Vancouver, British Columbia
V6C 2Z7

Counsel for Canfor Corporation in the Consolidated Arbitration Pursuant to Article 1126 of the North
American Free Trade Agreement (NAFTA) and the U NCITRAL Arbitration Rules between Canfor
Corporation v. United States of America and Term inal Forest Products Ltd. v. United States of
America
WT/DS277/20/Add.1, G/L/598/Add.2,
 G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

By: _________________________ Dated: ______, 2006
Keith E.W. Mitchell
Harris and Company
14 Floor Bentall 5, 550 Burrard
Vancouver, British Columbia
V6C 2B5

Counsel for Canfor Corporation in the Consolidated Arbitration Pursuant to Article 1126 of the North
American Free Trade Agreement (NAFTA) and the U NCITRAL Arbitration Rules between Canfor
Corporation v. United States of America and Term inal Forest Products Ltd. v. United States of
America

By: _________________________ Dated: ______, 2006
B. Thomas Peele, III
Baker & McKenzie, LLP
815 Connecticut Avenue, NW.
Suite 900
Washington, DC 20006-4078

Counsel for Canadian Forest Products Ltd ., Canfor Corporation and its affiliates , Canfor Wood
Products Marketing Ltd.
WT/DS277/20/Add.1, G/L/598/Add.2,
G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

ANNEX 2B

October 12, 2006

H.E. Mr. Muhamad Noor Yacob
Chairperson
Dispute Settlement Body
World Trade Organization
Centre William Rappard
Rue de Lausanne 154
1211 Geneva 21

 Re: United States -– Preliminary Determinations with respect to Certain Softwood
Lumber from Canada (DS236);

 United States -– Provisional Anti-Dumping Measure on Imports of Certain Softwood
Lumber from Canada (DS247);

 United States -– Final Countervailing Duty Determination with respect to Certain
Softwood Lumber from Canada (DS257);

 United States -– Final Dumping Determination on Softwood Lumber from Canada
(DS264);

 United States -– Investigation of the International Trade Commission in Softwood
Lumber from Canada (DS277); and

 United States -– Reviews of Countervailing Duty on Softwood Lumber from Canada
(DS311).

Notification of Mutually Agreed Solution

Dear Mr. Chairman:

 The Governments of the United States of Amer ica and Canada hereby wish to notify the
Dispute Settlement Body ("DSB") that, in accordance with Article 3.6 of the Understanding on Rules
and Procedures Governing the Settlement of Disputes , we have reached a mutually agreed solution to
the matters raised by Canada in th e above-referenced disputes. This solution has taken the form of a
comprehensive agreement between the United States and Canada, dated 12 September 2006, resolving
all disputes related to trade in softwood lumber between our two countries (the "Softwood Lumber
Agreement"). A copy of the Softwood Lumber Agreement is attached.

 In light of the foregoing, Canada hereby withdraws its requests (WT/DS257/16;
WT/DS264/17; WT/DS277/9) to the DSB pursuant to Article 22.2 of the DSU for authorization to
suspend the application to the United States of tariff concessions or other obligations under the
General Agreement on Tariffs and Trade 1994 ("GATT 1994"). Canada having withdrawn its
requests under Article 22.2 of the DSU, th e United States hereby withdraws its requests
(WT/DS257/17; WT/DS264/19; WT/DS277/10) to the DSB for arbitration under Article 22.6 of the
WT/DS277/20/Add.1, G/L/598/Add.2,
 G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

DSU objecting to the level of suspension of tari ff concessions or other ob ligations under the GATT
1994 proposed by Canada.

 This mutually agreed solution is without pr ejudice to the WTO rights and obligations of the
United States and Canada except with respect to the disputes listed above.

 We ask that you circulate this notification to the relevant Councils and Committees, as well as
to the Dispute Settlement Body.

Sincerely,

Don Stephenson
Ambassador and Permanent Representative
of Canada to the World Trade Organization
Peter F. Allgeier
Ambassador and Permanent Representative
of the United States to the World Trade
Organization
WT/DS277/20/Add.1, G/L/598/Add.2,
G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

ANNEX 3A

USDOC CVD Liquidation Instructions to USCBP

RE: NOTICE OF REVOCATION OF THE COUNTERVAILING DUTY ORDER AND
TERMINATION OF COUNTERVAILING DUTY REVIEWS RELATED TO CERTAIN
SOFTWOOD LUMBER FROM CANADA FOR THE PERIOD 05/22/2002 THROUGH
XX/XX/XXXX ([C-122-839])

1. THE DEPARTMENT OF COMMERCE HAS REVOKED THE COUNTERVAILING
DUTY ORDER AND TERMINATED ALL REVIEWS, ON CERTAIN SOFTWOOD LUMBER
FROM CANADA PURSUANT TO SETTLEMENT OF LITIGATION. THE EFFECTIVE DATE
OF REVOCATION IS 05/22/2002.

2. THEREFORE, CBP IS DIRECTED TO CEASE COLLECTION OF CASH DEPOSITS
EFFECTIVE XX/XX/XX (THE EFFECTIVE DATE OF SETTLEMENT OF LITIGATION) AND
TERMINATE IMMEDIATELY THE SUSPENSION OF LIQUIDATION FOR ALL SHIPMENTS
OF CERTAIN SOFTWOOD LUMBER FROM CANADA ENTERED, OR WITHDRAWN FROM
WAREHOUSE, FOR CONSUMPTION ON OR AFTER MAY 22, 2002. ALL UNLIQUIDATED
ENTRIES OF THE SUBJECT MERCHANDISE THAT WERE ENTERED OR WITHDRAWN
FROM WAREHOUSE FOR CONSUMPTION, ON OR AFTER MAY 22, 2002, THE
LIQUIDATION OF WHICH IS SUSPENDED, SHOULD BE LIQUIDATED WITHOUT REGARD
TO COUNTERVAILING DUTIES (I.E., RELEASE ALL BONDS AND REFUND ALL CASH
DEPOSITS) AND ALL DEPOSITS SHALL BE REFUNDED WITH ACCRUED INTEREST TO
THE IMPORTERS OF RECORD OR THEIR DESIGNATES.

3. THE ASSESSMENT OF COUNTERVAILING DUTIES BY CUSTOMS AND BORDER
PROTECTION ON ENTRIES OF THIS MERCHANDISE IS SUBJECT TO THE PROVISIONS OF
SECTION 778 OF THE TARIFF ACT OF 1930. SECTION 778 REQUIRES THAT CBP PAY
INTEREST ON OVERPAYMENTS, OR ASSESS INTEREST ON UNDERPAYMENTS, OF THE
REQUIRED AMOUNTS DEPOSITED AS ESTIMATED COUNTERVAILING DUTIES.
INTEREST SHALL BE CALCULATED FROM THE DATE OF PAYMENT OF ESTIMATED
COUNTERVAILING DUTIES THROUGH THE DATE OF LIQUIDATION. THE RATE AT
WHICH SUCH INTEREST IS PAYABLE IS THE RATE IN EFFECT UNDER SECTION 6621 OF
THE INTERNAL REVENUE CODE OF 1954 FOR SUCH PERIOD.

4. IF THERE ARE ANY QUESTIONS REGARDING THIS MATTER BY CBP OFFICERS,
THE IMPORTING PUBLIC OR INTERESTED PARTIES, PLEASE CONTACT DAVINA
HASHMI OR RON TRENTHAM AT OFFICE OF AD/CVD OPERATIONS, IMPORT
ADMINISTRATION, INTERNATIONAL TRADE ADMINISTRATION, U.S. DEPARTMENT OF
COMMERCE, AT (202) 482-0984 OR (202) 482-3577 RESPECTIVELY (GENERATED BY
O(Office Number):

Analyst's Initials (Example: O2:RL)).

5. THERE ARE NO RESTRICTIONS ON THE RELEASE OF THIS INFORMATION.
 CATHY SAUCEDA
WT/DS277/20/Add.1, G/L/598/Add.2,
 G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

USDOC AD Liquidation Instructions to USCBP

RE: NOTICE OF REVOCATION OF THE ANTIDUMPING DUTY ORDER AND
TERMINATION OF ANTIDUMPING DUTY REVIEWS RELATED TO CERTAIN SOFTWOOD
LUMBER FROM CANADA FOR THE PERIOD 05/22/2002 THROUGH XX/XX/XXXX
([A-122-838])

1. THE DEPARTMENT OF COMMERCE HAS REVOKED THE ANTIDUMPING DUTY
ORDER AND TERMINATED ALL REVIEWS ON CERTAIN SOFTWOOD LUMBER FROM
CANADA PURSUANT TO SETTLEMENT OF LITIGATION. THE EFFECTIVE DATE OF
REVOCATION IS 05/22/2002.

2. THEREFORE, CBP IS DIRECTED TO CEASE COLLECTION OF CASH DEPOSITS
EFFECTIVE XX/XX/XX (THE EFFECTIVE DATE OF SETTLEMENT OF LITIGATION) AND
TERMINATE IMMEDIATELY THE SUSPENSION OF LIQUIDATION FOR ALL SHIPMENTS
OF CERTAIN SOFTWOOD LUMBER FROM CANADA ENTERED, OR WITHDRAWN FROM
WAREHOUSE, FOR CONSUMPTION ON OR AFTER 05/22/2002, EXCEPT FOR ENTRIES
ENTERED OR WITHDRAWN FROM WAREH OUSE FROM 05/22/2002 THROUGH 04/30/2003
THAT HAVE BEEN ENJOINED. ALL UNL IQUIDATED ENTRIES OF THE SUBJECT
MERCHANDISE THAT WERE ENTERED OR WITHDRAWN FROM WAREHOUSE FOR
CONSUMPTION, ON OR AFTER 05/22/2002, THE LIQUIDATION OF WHICH IS SUSPENDED,
SHOULD BE LIQUIDATED WITHOUT REGARD TO ANTIDUMPING DUTIES (I.E., RELEASE
ALL BONDS AND REFUND ALL CASH DEPOSITS) AND ALL DEPOSITS SHALL BE
REFUNDED WITH ACCRUED INTEREST TO TH E IMPORTERS OF RECORD OR THEIR
DESIGNATES EXCEPT FOR ENTRIES DU RING THE PERIOD 05/22/2002 THROUGH
04/30/2003 THAT HAVE BEEN ENJOINED. CBP SHOULD CONTINUE TO SUSPEND
LIQUIDATION OF ENJOINED ENTRIES ENTERED, OR WITHDRAWN FROM WAREHOUSE,
FOR CONSUMPTION FROM 5/22/2002 TH ROUGH 4/30/2003 UNTIL LIQUIDATION
INSTRUCTIONS ADDRESSING THESE ENTRIES ARE PROVIDED.

3. THE ASSESSMENT OF ANTIDUMPING DUTIES BY CUSTOMS AND BORDER
PROTECTION ON ENTRIES OF THIS MERCHANDISE IS SUBJECT TO THE PROVISIONS OF
SECTION 778 OF THE TARIFF ACT OF 1930. SECTION 778 REQUIRES THAT CBP PAY
INTEREST ON OVERPAYMENTS, OR ASSESS INTEREST ON UNDERPAYMENTS, OF THE
REQUIRED AMOUNTS DEPOSITED AS ESTIMATED ANTIDUMPING DUTIES. INTEREST
SHALL BE CALCULATED FROM THE DATE OF PAYMENT OF ESTIMATED
ANTIDUMPING DUTIES THROUGH THE DATE OF LIQUIDATION. THE RATE AT WHICH
SUCH INTEREST IS PAYABLE IS THE RATE IN EFFECT UNDER SECTION 6621 OF THE
INTERNAL REVENUE CODE OF 1954 FOR SUCH PERIOD.

4. IF THERE ARE ANY QUESTIONS REGARDING THIS MATTER BY CBP OFFICERS,
THE IMPORTING PUBLIC OR INTERESTED PARTIES, PLEASE CONTACT DAVINA
HASHMI OR RON TRENTHAM AT OFFICE OF AD/CVD OPERATIONS, IMPORT
ADMINISTRATION, INTERNATIONAL TRADE ADMINISTRATION, U.S. DEPARTMENT OF
COMMERCE, AT (202) 482-0984 OR (202) 482-3577 RESPECTIVELY (GENERATED BY
O(Office Number):

Analyst's Initials (Example: O2:RL)).
WT/DS277/20/Add.1, G/L/598/Add.2,
G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

5. THERE ARE NO RESTRICTIONS ON THE RELEASE OF THIS INFORMATION.
 CATHY SAUCEDA
WT/DS277/20/Add.1, G/L/598/Add.2,
 G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

ANNEX 3B

USDOC Liquidation Instructions to USCBP

RE: LIQUIDATION INSTRUCTIONS FOR CERTAIN SOFTWOOD LUMBER FROM
CANADA FOR THE PERIOD 05/22/2002 THROUGH 04/30/2003 (A-122-838)

1. THE INJUNCTIONS IN WEST FRASER LTD. V. UNITED STATES
 (CONSOL.
CT. 05-00079) LIFTED ON (MM/DD/YYYY). AS A RESULT, LIQUIDATION OF PREVIOUSLY
ENJOINED ENTRIES OF THE SUBJECT MERCHANDISE ENTERED, OR WITHDRAWN
FROM WAREHOUSE, FOR CONSUMPTION DURING THE PERIOD 05/22/2002 THROUGH
04/30/2003 IS NO LONGER ENJOINED.

2. ON (MM/DD/YYYY) COMMERCE REVOKED THE ANTIDUMPING DUTY ORDER
ON CERTAIN SOFTWOOD LUMBER FROM CANADA PURSUANT TO SETTLEMENT OF
LITIGATION. THE EFFECTIVE DATE OF THAT REVOCATION WAS 05/22/2002.
THEREFORE, CBP IS DIRECTED TO CEASE IMMEDIATELY ANY SUSPENSION OF
LIQUIDATION FOR ALL SHIPMENTS OF CERTAIN SOFTWOOD LUMBER FROM CANADA
ENTERED, OR WITHDRAWN FROM WAREHOU SE, FOR CONSUMPTION FROM 05/22/2002
THROUGH 04/30/2003. ALL UNLIQUIDATED ENTRIES OF THE SUBJECT MERCHANDISE
THAT WERE ENTERED OR WITHDRAWN FROM WAREHOUSE FOR CONSUMPTION
FROM 05/22/2002 THROUGH 04/30/2003, THE LIQUIDATION OF WHICH IS SUSPENDED,
SHOULD BE LIQUIDATED WITHOUT REGARD TO ANTIDUMPING DUTIES (I.E., RELEASE
ALL BONDS AND REFUND ALL CASH DEPOSITS) AND ALL DEPOSITS SHALL BE
REFUNDED WITH ACCRUED INTEREST TO TH E IMPORTERS OF RECORD OR THEIR
DESIGNATES.

3. THE ASSESSMENT OF ANTIDUMPING DUTIES BY CUSTOMS AND BORDER
PROTECTION ON ENTRIES OF THIS MERCHANDISE IS SUBJECT TO THE PROVISIONS OF
SECTION 778 OF THE TARIFF ACT OF 1930. SECTION 778 REQUIRES THAT CBP PAY
INTEREST ON OVERPAYMENTS, OR ASSESS INTEREST ON UNDERPAYMENTS OF THE
REQUIRED AMOUNTS DEPOSITED AS ESTIMATED ANTIDUMPING DUTIES. INTEREST
SHALL BE CALCULATED FROM THE DATE OF PAYMENT OF ESTIMATED
ANTIDUMPING DUTIES THROUGH THE DATE OF LIQUIDATION. THE RATE AT WHICH
SUCH INTEREST IS PAYABLE IS THE RATE IN EFFECT UNDER SECTION 6621 OF THE
INTERNAL REVENUE CODE OF 1954 FOR SUCH PERIOD.

4. PREVIOUSLY ISSUED INSTRUCTIONS ADDRESSED THE LIQUIDATION OF
ENTRIES OF THE SUBJECT MERCHANDISE THAT WERE ENTERED OR WITHDRAWN
FROM WAREHOUSE FOR CONSUMPTION FROM 05/01/2003 THROUGH THE DATE OF
REVOCATION OF THE ANTIDUMPING DUTY ORDER. [REFERENCE TO PRIOR
INSTRUCTIONS]

5. IF THERE ARE ANY QUESTIONS REGARDING THIS MATTER BY CBP OFFICERS,
THE IMPORTING PUBLIC OR INTERESTED PARTIES, PLEASE CONTACT DAVINA
HASHMI OR RON TRENTHAM AT OFFICE OF AD/CVD OPERATIONS, IMPORT
ADMINISTRATION, INTERNATIONAL TRADE ADMINISTRATION, U.S. DEPARTMENT OF
COMMERCE, AT (202) 482-0984 OR (202) 482-3577 RESPECTIVELY (GENERATED BY
O(Office Number):
WT/DS277/20/Add.1, G/L/598/Add.2,
G/ADP/D45/2/Add.1, G/SCM/D51/2/Add.1

Analyst's Initials (Example: O2:RL)).

6. THERE ARE NO RESTRICTIONS ON THE RELEASE OF THIS INFORMATION.
 CATHY SAUCEDA