Washington's U.S. Senators asked the FMC for an investigation of 'diversions' of U.S.-bound, Asia-origin cargo through Canada, brought into United States via Canadian rail services.
The Federal Maritime Commission in the U.S. decided late last year to launch a study into possible unfair practices by Ottawa for its container ports, raising fears of a damaging trade war.
Richard Lidinsky, the chairman of the Federal Maritime Commission (FMC), said he would be proposing a study on whether Canadian and Mexican ports are benefiting from unfair subsidization, following a request for an investigation by two U.S. senators from Washington state. They wanted an investigation of “diversions” of U.S.-bound, Asia-origin cargo through Canada, brought into United States via Canadian rail services.
Some of the issues to be investigated include the Harbor Maintenance Tax, which isn’t in place in Canada, as well as rail service rates and infrastructure funding.
The report will be referred to the U.S. Congress, which could launch retaliatory trade actions against Canada.
In an FMC news release, Lidinsky stated: “Canadian and Mexican ports are free to compete with U.S. ports for U.S. cargo. But they should do so on a playing field that is not artificially tilted by governments’ policies. So the primary question is: Are we handicapping our own ports in international competition?”