Coalition for Fair Lumber Imports Applauds U.S. Government Initiation of Arbitration Proceeding Against British Columbia Softwood Lumber Agreement Violations

WASHINGTON, Jan. 18, 2011 /PRNewswire-USNewswire/ -- The U.S. Coalition for Fair Lumber Imports today welcomes United States Trade Representative Ron Kirk's decision to initiate arbitration under the Softwood Lumber Agreement (SLA) to address timber pricing practices in the British Columbia (BC) Interior that circumvent the SLA.

Since the spring of 2007, the British Columbia Government has sold BC Interior lumber producers enormous amounts of timber that was improperly classified as 'lumber reject' yet used to manufacture lumber for the minimum price of C$0.25 per cubic meter, contrary to rules grandfathered under the SLA that govern eligibility for the minimum stumpage price.

"The enormous increase in the amount of timber priced at the C$0.25/m3 minimum price has saved BC Interior lumber producers hundreds of millions of dollars in fiber costs, compared to what they would have paid under the timber pricing system that was in place when the U.S.-Canada Softwood Lumber Agreement was signed," explained Steve Swanson, Chairman of the Coalition and President of the family-run Swanson Group in Oregon.

"As North American lumber producers have curtailed production, closed mills, and been forced to let go thousands of workers due to the severe lumber market downturn, the BC government's expanded and unfair subsidy to BC Interior mills has had devastating effects on the rest of the industry outside BC -- both in the United States and Canada," added Swanson.

The Softwood Lumber Agreement stipulates that any disputes under the agreement are to be resolved through a commercial-type binding arbitration process before the London Court of International Arbitration (LCIA), involving commercial arbitrators that are neither citizens nor residents of the United States or Canada.  This is the third time that the United States has been forced to bring an arbitration case against violations by Canada of the terms of the SLA.

"BC must reverse its actions and begin to charge the stumpage fees required under the SLA and impose additional compensatory export taxes to collect the export taxes that its producers have been effectively evading since 2007," stated Swanson.  "In light of British Columbia's willful disregard of the terms of the Softwood Lumber Agreement, we are confident that the Arbitration panel will find in favor of the United States," concluded Swanson.

For more information on British Columbia's Softwood Lumber Agreement violation, see http://www.uslumbercoalition.org/doc/fact_sheet_01-18-11.pdf.

About the Coalition for Fair Lumber Imports

The U.S. Coalition for Fair Lumber Imports is an alliance of large and small lumber producers from around the country, joined by hundreds of thousands of their employees, and tens of thousands of woodland owners. The Coalition is united in opposition to Canada's unfair lumber-trade practices, including the gross under-pricing of timber on government-owned lands. For more information, please visit the Coalition's website at www.uslumbercoalition.org.

SOURCE Coalition for Fair Lumber Imports