A NAFTA review panel has unanimously ordered the U.S. Department of Commerce to reconsider its costly duties against Canadian mills that produce glossy paper.
The countervailing duties were imposed in November 2015 after a U.S. investigation into Canadian imports of supercalendered paper, which is mainly used in magazines, catalogues, corporate brochures and advertising inserts.
Nova Scotia's Port Hawkesbury Paper was hit with a 20.18 per cent duty, while a duty of 17.87 per cent was levelled against Montreal-based Resolute Forest Products and a duty of 18.85 per cent was imposed on the J.D. Irving mill in New Brunswick and Catalyst Paper of British Columbia.
Under the new ruling, the U.S. must reconsider some aspects of the reasoning behind its initial findings and respond to the NAFTA decision by mid-summer.
The U.S. trade action resulted from a petition filed by two American producers of supercalendered paper who maintain their Canadian competitors benefited from government subsidies.
In a news release, Port Hawkesbury Paper welcomed the decision, but says it will continue "vigorous work" to substantially reduce the duties or to eliminate them entirely.