Washington, November 23:

The United States said it will keep collecting duties on Canadian lumber of some 20 per cent until a ‘final’ decision on the trade row by a North American Free Trade Agreement

(NAFTA) panel.

The US Commerce Department announced it would comply with a NAFTA panel ruling earlier this year by officially calculating the duty on softwood lumber from Canada at a rate of 0.8 per cent. But John Sullivan, general counsel for the Department of Commerce, said that even though the duty rate was changed on paper, US officials would not immediately alter the practice of collecting duties of 20.96 per cent at the border.

“We’re complying with the panel’s decision, but we don’t agree with it,” he said. Additionally, Sullivan said Washington was not prepared to refund prior lumber duties of some four billion US dollars sought by Canada.

“This particular matter that is being litigated is not final,” Sullivan told journalists in a conference call.

After the case is finalised, Washington would ‘assess’ its position. Even if the NAFTA panel finalises its ruling, the official said, Washington could still make an ‘extraordinary challenge’ under the trade pact that would take additional time.

In the meantime, Sullivan said Washington hopes to reach a negotiated settlement with Ottawa on the longstanding trade row.

The hard-line stand came amid reports that Ottawa was preparing to provide an additional $1.2 billion in aid for lumber companies and communities affected by the trade dispute.