Canada won the bulk of a ruling at the World Trade Organization on Thursday in a dispute over U.S. duties on Canadian exports of supercalendered paper, which is used in glossy magazines and catalogues.
Canada filed the complaint in 2016, saying Washington was wrong to penalize Canada for subsidizing its paper industry.
The ruling can be appealed by either side.
The panel of WTO judges declined to rule on several of Canada’s arguments, but in other respects they found almost entirely in Canada’s favour.
Canada had complained about U.S. subsidy investigations into Canadian firms Port Hawkesbury Paper LP and Resolute FP, and says other firms had received subsidies.
It also said the U.S. Department of Commerce had been wrong to accept allegations made by rival U.S. firms when it discovered Canadian firms had not fully disclosed potential subsidy programs. The WTO panel agreed.
The ruling could deepen U.S. President Donald Trump’s ire with the global trading body. He has complained it treats the United States unfairly, although trade experts say the U.S. win-lose rate in trade disputes is no worse, and possibly somewhat better, than that of other WTO members.
Successive U.S. administrations have been angered by WTO rulings on U.S. trade policies, including a long string of defeats over the U.S. way of assessing unfairly priced trade, known as “dumping.”
Mr. Trump threatened to take action against the WTO on Monday after media reports said he wanted to withdraw from the global trade regulator.
He has already thrown the WTO into a crisis by blocking the appointment of appeals judges, threatening to bring the world’s system of resolving trade disputes to a halt.