PORT ANGELES — The government of Canada is reviewing the $25 million damage claim filed this week by Merrill & Ring but has no intention of changing the log export rules that prompted it.
“I’m not aware of any effort to change the log export policies,” said Brooke Grantham, spokesman for Foreign Affairs and International Trade Canada in Ottawa.
“We have not yet reviewed the basis for the challenge set out in the notice.
“But Canada is of the opinion that its policies on log exports are fully consistent with NAFTA,” he said.
Merrill & Ring complaint
On Monday, Merrill & Ring filed a notice of intent to submit a claim to arbitration under the North American Free Trade Agreement seeking at least $25 million in damages.
The Port Angeles-based forestry and land management company, which owns about 8,000 acres of timberland in British Columbia, says the Canadian government has unfairly restricted its log exports in violation of NAFTA.
Grantham said there’s no indication these log export rules have been challenged in the past, although “Chapter 11” claims under the NAFTA agreement are filed quite often.
“Canada is assessing and reviewing the claim and if necessary Canada will defend its interests,” he said.
Governor’s trade advisor
Robert Hamilton, Gov. Chris Gregoire’s adviser for trade policy, said such Chapter 11 claims are one of the most controversial provisions of NAFTA.
Those claims also can be quite protracted, he said.
“It’s so early in the process, these things take a couple years.
“So it’s something I’ll be watching but I doubt the governor will have any statement. It’s way too early,” Hamilton said.
Chapter 11 of the North American Free Trade Agreement contains provisions designed to protect cross-border investors and help settle investment disputes.
It allows an investor from one NAFTA country (United States, Canada, Mexico) to seek monetary damages if rules of another country violate that section of the continental free trade agreement that took effect on Jan. 1, 1994.
Four other Chapter 11 cases have been filed against Canada: Ethyl Corp., S.D. Myers Inc., Pope and Talbot Inc. and United Parcel Service of America.