The U.S. Court of International Trade (“CIT”) on August 18, 2021, invalidated the 2019 U.S. Department of Commerce (“DOC”) expedited countervailing duty (“CVD”) review of softwood lumber from Canada in Committee Overseeing Action for Lumber International Trade Investigations or Negotiations v. United States. In result, DOC is scheduled to publish notice in the Federal Register in late August 2021 invalidating that expedited CVD review. This publication would change the CVD cash deposit rates for the following sets of Canadian softwood lumber producers who were not individually examined in the CVD investigation.
- Companies that DOC excluded from the CVD order through the expedited review would again become subject, requiring importers to prospectively pay 14.19% CVD cash deposits:
- Les Produits Forestiers D&G Ltee;
- Marcel Lauzon Inc.;
- North American Forest Products Ltd.;
- Roland Boulanger & Cie Ltée; and
- Scierie Alexandre Lemay & Fils Inc.
- Companies that obtained lower CVD cash deposit rates through the expedited review would have those lowered rates invalidated, requiring importers to prospectively pay higher CVD cash deposits:
- Mobilier Rustique (Beauce) Inc. (increased from 1.99% to 14.19%);
- Fontaine Inc. (increased from 1.26% to 14.19%); and
- Produits Matra Inc. and Sechoirs de Beauce Inc. (increased from 5.8% to 7.42%).
The CIT expressly declined to provide retroactive relief, meaning that softwood lumber from these companies that has already entered the United States is unaffected by the ruling.
Importers sourcing from these sets of Canadian softwood lumber companies should expect to soon start paying CVD cash deposits or increased CVD cash deposits, respectively, unless the CIT decides to “stay” cash deposit collection pending further appeal – a possibility mentioned in the ruling. The ultimate CVD liability for softwood lumber from these companies is not expected to be resolved soon, as this ruling will likely be appealed to the U.S. Court of Appeals for the Federal Circuit. The question of law presented is whether DOC has the statutory authority to conduct expedited CVD reviews pursuant to its 1997 regulation. If affirmed on appeal, Canada could bring challenge before the World Trade Organization – which requires its members to allow for expedited CVD reviews.
If you have any questions, please contact one of our attorneys.
