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NAFTA Rules for Canada in Suit

June 28, 2000

TORONTO (AP) _ An international tribunal ruled in favor of Canada on two parts of a $380 million lawsuit filed by an Oregon company under the North American Free Trade Agreement, the Canadian government said Tuesday.

Pope & Talbot, a forest products company based in Portland, Oregon, is seeking damages over softwood export limits imposed by Canada under the Canada-U.S. softwood lumber agreement of 1996.

The company says the softwood lumber agreement is discriminatory and the export limits damaged its business.

Pope & Talbot operates sawmills in British Columbia that sell lumber to the United States, so it comes under the export limits that charge fees when lumber exports from four provinces _ British Columbia, Alberta, Ontario and Quebec _ total more than 14.7 billion board feet a year.

The company argued it would be treated differently if it operated in other Canadian provinces where the export quotas don’t apply.

In its decision, the tribunal ruled Canada abided by NAFTA regulations involving export quotas, and rejected Pope & Talbot’s complaint that the limits amounted to expropriation of its investment.

The tribunal reserved its decision on two other aspects of the case involving whether Canada discriminated against Pope & Talbot.

``We welcome the tribunal’s decision,″ International Trade Minister Pierre Pettigrew said. ``In the remainder of this arbitration, we will reiterate that Canada’s actions are consistent with its NAFTA obligations.″

Pope & Talbot president Michael Flannery said he was ``pleased the tribunal is acting very quickly in this case, and with such thoroughness.″

``The tribunal has narrowed its focus onto the most important area of the claim,″ Flannery said.

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