B.C. Claims Victory in Softwood Lumber Case

B.C. lumber | BCBusiness
B.C. lumber producers avoided a $300-million penalty in a case filed by their U.S. counterparts.

An international arbitration court sided with the province in a dispute with U.S. lumber companies over wood infested with pine beetles.

The province’s lumber producers are welcoming a victorious ruling Thursday in a year-long legal skirmish with their U.S. competitors.
 
Several American lumber companies filed a complaint in 2011 claiming B.C. wasn’t abiding by the terms of the U.S.-Canada Softwood Lumber Agreement. The complaint alleged the province justified low stumpage rates (the equivalent of a subsidy, in their eyes) with the 15-year mountain pine beetle infestation that’s devastated the lumber industry and the entire region.
 
The companies also complained that B.C.’s export volumes for the beetle-infested timber seemed noticeably higher than predicted.
 
Of course B.C. denied the allegations, protesting that U.S. lumber companies had to anticipate large volumes of low-grade lumber due to those rotten pine beetles. And the London-based Court of International Arbitration unanimously agreed, tossing out the claim and siding with B.C.
 
The favourable ruling is an event to be celebrated — if the court had gone the other way, our lumber producers would be stuck with a $300-million penalty for violating the terms of the pricing policies outlined in the international agreement.