Dairy products: Washington launches new lawsuit against Ottawa

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Products Dairy: Washington Launches New Proceedings Against Ottawa

Washington resorted to treaty provisions to denounce Canadian milk quotas.

The US administration announced on Tuesday its intention to launch a new conciliation procedure against Ottawa, within the framework of the North American Free Trade Agreement, concerning the quotas tariffs for dairy products, a subject of dispute for many months between Canada and the United States.

The two countries clash over the granting of tariff quotas, provided for in the Canada-United States-Mexico Agreement (CUSMA), a mechanism imposing a zero or low customs duty on imports of certain products up to a certain quantity.

Washington has already used treaty provisions to denounce Canadian milk quotas.

And the administration prevailed when, in early January, the settlement panel ruled that these quotas violated CUSMA provisions.

However, trade restrictions do not seem to have been lifted on the Canadian side.

“The United States requests the initiation of a new conciliation procedure for the settlement of disputes under the x27;CUSMA Agreement on Canada's Dairy Tariff Rate Quotas. »

— Diplomatic Trade Mission, attached to the White House

The diplomatic mission said it has identified additional aspects of the Canadian measures that appear to contradict Canada's obligations under the agreement, adding that the concerns of the United States have only made it worse. increase.

Rather than working to meet its obligations, Canada persists in implementing new dairy policies that are contrary to the CUSMA agreement, has denounced Trade Ambassador Katherine Tai, quoted in the press release.

Canada continues to violate its obligations under the agreement by refusing to remove its trade restrictions on US dairy products, US Secretary of Agriculture Tom Vilsack insisted.

This is Washington's third recourse to this treaty provision.

At the end of May, the United States notably accused Canada to give a majority of the quotas for dairy products to Canadian processors, who are more inclined to import cheap American cheese, effectively excluding other American products.

In December 2021, Washington had already appealed to the settlement panel provided for in the treaty, which had concluded last January that Canada's practice of maintaining reserves of tariff quotas for use exclusively for dairy processors was incompatible with CUSMA.

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