CBP must reconcile and verify data provided by the exporter and importer as required by the 2008 Act. The agency reconciles aggregated export prices from the U.S. entry forms with aggregated export prices from Canadian export permits.
To meet the 2008 Act's verification requirement that the importer has correctly reported the export price, the tax to be paid by exporters to the Canadian government (the export charge), and other information, CBP has created a process in its system to collect these data.
However, the Government Accountability Office said in a report that CBP port officials manually enter the data into the system, which could lead to miscoding and potential inaccurate analysis.
CBP, along with the Commerce Department and Office of the U.S. Trade Representative, said the information produced through the reconciliation and verification requirements under the 2008 Act thus adds little assurance of compliance with the 2006 Softwood Lumber Agreement, the GAO report said.
The United States and Canada have been embroiled in a decades-long dispute over trade in softwood lumber. Canada is the biggest exporter of softwood lumber to the United States. In 2008, Canada exported about $3.2 billion worth of softwood lumber products to the United States, about 17 times the amount supplied by the next largest exporter to the United States.
One of the main causes of the dispute is differences in costs for timber harvested on public lands in Canada, compared to timber from private lands in the United States. In Canada, federal and provincial governments own about 90 percent of the timberlands and set harvest fees and allocations. In the United States, only about 40 percent of timberland is publicly owned, and the timber from that land is sold through competitive auctions. The U.S. lumber industry has alleged that the use of government-set fees for Canada raised the possibility that private industry in Canada has access to timber at less than market prices.
After several years of litigation related to U.S. allegations of unfair Canadian subsidies, the two countries signed the 2006 Softwood Lumber Agreement. In 2008, Congress passed the Softwood Lumber Act requiring the U.S. government to reconcile and verify softwood lumber trade data.
View the GAO report, here.
