Port Angeles timber firm insists complaint not linked to U.S.-Canada softwood deal

PORT ANGELES — When a local forestry company gave notice on Monday that it was going to take on the Canadian government over timber policies in British Columbia, the Canadian business press reported that some wondered at the timing.

That’s because on Oct. 1, the Canada-U.S. softwood lumber agreement will take effect, ending a decades-long battle between the trade partners.

Now it appears there will be another showdown.

But Norm Schaaf, vice-president of timberland and administration for Merrill & Ring Forestry, said the complaint filed Monday has nothing to do with the softwood showdown that has finally simmered down.

“It has nothing to do with that whatsoever,” Schaaf said.

The complaint was filed under Chapter 11 of the North American Free Trade Agreement.

Canada’s Financial Post reported Tuesday that Merrill & Ring’s $25 million complaint over what it says are unfair rules placed on them by the British Columbia provincial government and blessed by the national government has unnamed government officials in both camps uneasy.

Schaaf told the Peninsula Daily News that Merrill & Ring had hoped that the governments would address the issue of British Columbia restricting how much timber it can export from the 8,000 acres in British Columbia the company has owned since the late 1800s.

They didn’t, so the Port Angeles-based forestry company’s lawyer began following the procedures for filing the notice, Schaaf said.

If the company and the Canadian government can’t reach an agreement in 90 days, the complaint will go before a tribunal.

Schaaf said the process can take years.

The trade pact’s rules can’t force governments to change their laws, but they can force governments to reimburse companies for lost profits.

“We’ve certainly suffered financial damages,” Schaaf said.

The softwood debate, which has been raging since the early 1980s, had the U.S. accusing the Canadian government of unfairly subsiding its timber industry.

The rule that sparked the complaint requires foreign timber companies that want to export logs to advertise them through the British Columbia Forest Service.

If a British Columbia mill makes an offer on the logs, even if the offer is below market price, the government prohibits the logs from being exported, Schaaf said.

Foreigners own about 3 percent of British Columbia timber, the Financial Post reported.

The government owns the vast majority of timber lands.

“We’re a very small player in British Colombia,” Schaaf said.

Carol Johnson, executive director of the North Olympic Timber Action Committee, said Merrill & Ring was the largest landowner in British Columbia from the North Olympic Peninsula.

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