An independent U.S. federal agency ruled Wednesday that Canadian paper imports don't hurt American producers, delivering a surprise decision that eliminates tariffs that had raised prices and squeezed margins at struggling newspapers.
The U.S. International Trade Commission said in a statement that its decision ends the yearlong government investigation into allegations that Canada was dumping uncoated groundwood paper into the U.S. and offering its producers unfair subsidies. The paper is commonly used to print newspapers.
The ruling comes after the commission last year agreed that American producers were possibly "materially injured" by Canadian imports. The Commerce Department subsequently slapped preliminary duties on the product. The department early this month lowered the rate of its duties, slashing them to zero for two Canadian exporters and trimming them to 16.9 percent from 22.2 percent for a third.
Many U.S. newspapers had complained the tariffs were an added burden amid years of declining revenue, and applauded Wednesday's decision.
"Today is a great day for American journalism," David Chavern, president of the News Media Alliance, which represents news organizations, said in an emailed statement. The ruling "will help to preserve the vitality of local newspapers and prevent additional job losses."
In a related development on Wednesday, the U.S. appealed a panel report from the World Trade Organization that ruled American duties against Canadian glossy paper imports violated international trade rules. If the WTO appellate body upholds the decision on appeal, it could force the U.S. to revise or eliminate its duties on the paper imports.
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