[Federal Register Volume 59, Number 156 (Monday, August 15, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-19928]


[[Page Unknown]]

[Federal Register: August 15, 1994]


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DEPARTMENT OF COMMERCE
International Trade Administration

 

U.S.-Canada Free-Trade Agreement, Article 1904 Binational Panel 
Reviews: Decision of the Extraordinary Challenge Committee

AGENCY: NAFTA Secretariat, United States Section, International Trade 
Administration, Department of Commerce.

ACTION: Notice of Decision of the Extraordinary Challenge Committee 
respecting Softwood Lumber Products from Canada, Secretariat File No. 
ECC-94-1904-01USA.

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SUMMARY: On August 3, 1994, the Extraordinary Challenge Committee (ECC) 
in review of the binational panel decision in the panel review of the 
affirmative countervailing duty determination made by the International 
Trade Administration, dismissed the request for an extraordinary 
challenge for failure to meet the standards of an extraordinary 
challenge set forth in FTA Article 1904.13. The ECC ordered that the 
Binational Panel's May 6, 1993 and December 17, 1993 Decisions 
reviewing the International Trade Administration's affirmative 
countervailing duty determination and redetermination on remand shall 
remain in effect. The Binational Panel's Order Affirming the 
Determination on Remand dated February 23, 1994 was affirmed.

FOR FURTHER INFORMATION CONTACT: James R. Holbein, United States 
Secretary, NAFTA Secretariat, Suite 2061, 14th and Constitution Avenue, 
Washington, D.C. 20230, (202) 482-5438.

SUPPLEMENTARY INFORMATION: Chapter 19 of the United States-Canada Free-
Trade Agreement (``Agreement'') establishes a mechanism to replace 
domestic judicial review of final determinations in antidumping and 
countervailing duty cases involving imports from the other country with 
review by independent binational panels. When a Request for Panel 
Review is filed, a panel is established to act in place of national 
courts to review expeditiously the final determination to determine 
whether it conforms with the antidumping or countervailing duty law of 
the country that made the determination.
    Under Article 1904.13 of the Agreement, where a Party alleges that 
a binational panel has seriously departed from a fundamental rule of 
procedure, has manifestly exceeded its powers, authority or 
jurisdiction or that a member of the panel has materially violated the 
Code of Conduct established pursuant to Article 1910, and further 
alleges that any of these actions have materially affected the panel's 
decision and threaten the integrity of the panel review process, that 
Party may request that an Extraordinary Challenge Committee be 
established under the procedure set out in Annex 1904.13 of the 
Agreement.
    Under Annex 1904.13 of the Agreement, the Government of the United 
States and the Government of Canada established Rules of Procedure for 
Article 1904 Extraordinary Challenge Committees (``ECC Rules''). These 
ECC Rules were published in the Federal Register on December 30, 1988 
(53 FR 53222). These Rules were amended in the Federal Register on 
February 8, 1994 (59 FR 5910). The ECC Rules give effect to the 
provisions of Chapter Nineteen of the Agreement with respect to 
Extraordinary Challenge Committee proceedings conducted pursuant to 
Article 1904 of the Agreement. The ECC Rules are intended to result in 
decisions typically within 30 days after the establishment of the 
Extraordinary Challenge Committee. The Extraordinary Challenge 
Committee proceeding in this matter was conducted in accordance with 
these ECC Rules.

Background

    On April 6, 1994, the United States Trade Representative filed a 
Request for an Extraordinary Challenge Committee on behalf of the 
United States Government in its capacity as a Party to the United 
States-Canada Free-Trade Agreement, with the United States Secretary of 
the NAFTA Secretariat. Four specific counts were contained in the 
Request. (1) The U.S. Government alleged that two of the Binational 
Panelists maintained relationships or engaged in activities creating 
the appearance of partiality or bias or, in the case of one of the 
panelists, constituting a serious conflict of interest. Further, 
contrary to the Binational Panel Rules of Conduct, the two Panelists 
did not disclose this information before joining the Panel or, in 
certain instances, as the information came to light during the Panel 
review; (2) The U.S. Government alleged that the Panel, in its May 6, 
1993 determination, manifestly exceeded its power, authority, and 
jurisdiction by failing to apply the appropriate standard of review and 
general legal principles that a court of the United States would apply 
when it ruled that Commerce must determine that the preferential 
treatment in timber pricing led to an increased output of lumber; (3) 
In its December 17, 1993 decision analyzing Commerce's determination 
that provincial stumpage programs in fact benefit a specific industry 
or group of industries, the Majority manifestly exceeded its power, 
authority, or jurisdiction by failing to apply the appropriate standard 
of review and by seriously misapprehending the U.S. substantive law it 
was required to apply; and (4) Finally, the U.S. Government alleged 
that for reasons similar to the case of stumpage, the Majority 
manifestly exceeded its powers, authority, and jurisdiction in its 
finding concerning whether B.C.'s log expert restriction were 
``specific'' under U.S. countervailing duty law.

ECC Decision

    The Extraordinary Challenge Committee issued its Memorandum 
Opinions and Order on August 3, 1994. Each Committee Member wrote a 
separate opinion, two affirming the Binational Panel's decisions and 
one dissenting. The Order dismissed the ECC Request for failure to meet 
other standards for an extraordinary challenge. The Order also affirmed 
the Binational Panel's decisions and order Affirming the Determination 
on remand.

    Dated: August 8, 1994.
James R. Holbein,
United States Secretary, NAFTA Secretariat.
[FR Doc. 94-19928 Filed 8-12-94; 8:45 am]
BILLING CODE 3510-GT-M