PORTLAND, Maine — U.S. trade officials on Wednesday backed tariffs up to 20 percent on certain Canadian paper producers they determined to have received government subsidies that hurt American producers of supercalendered paper, including the mill in Madison.
The vote from the U.S. International Trade Commission fixes tariffs on four Canadian producers of supercalendered paper, a decision sought by UPM Madison and Verso Paper, which own all of the production capacity for that grade of paper in the United States.
The decision received quick rebuke from the primary target of the investigation, Port Hawkesbury Paper, and various provincial governments in Canada. Port Hawkesbury said in a news release Wednesday that it joined the Canadian government in filing an appeal of the ruling under the North American Free Trade Agreement.
“While we are disappointed by the ITC’s decision, we are keen to have the opportunity for our case to be heard by an impartial NAFTA panel of five Canadian and U.S. international trade legal experts,” the company said in its statement.
A Canadian government official told Bloomberg Wednesday evening that the government disagrees with how the tariffs were calculated.
The decision makes final the tariffs issued by the U.S. International Trade Administration of 20.18 percent on imports of supercalendered paper from Port Hawkesbury; 17.87 percent for Resolute Paper Industries; and 18.85 percent on other producers, including Irving Pulp and Paper and Catalyst Paper Corp.
Altogether, the tariff rates approved Wednesday amount to about $150 million per year, based on a reported $868.4 million value of Canadian supercalendered paper imports to the United States in 2014.
Separately from the finding of material injury to U.S. supercalendered paper producers, Irving Pulp and Catalyst Paper Corp. have asked for expedited review of the tariffs assessed on their imported products.
Both companies contest they have not received any subsidies that are grounds for the assessment of tariffs and neither was investigated individually in the case.
UPM Madison and Verso Paper Corp. formed The Coalition for Fair Paper Imports to file their petition in February for trade duties on supercalendered paper with U.S. regulators.
Canada’s ambassador, Gov. Paul LePage, Maine’s U.S. senators and others have objected to lumping companies together in that duty assessment, arguing they should have had an opportunity in preliminary hearings to argue for company-specific preliminary tariff rates for supercalendered paper, which is used in color printing applications, including magazines, retail inserts, directories and coupons.
The ITC will issue its full report on the finding of injury to U.S. paper producers in a report due by Dec. 24.