The Government of Canada took a strong stand today against what it calls an unfounded American attack on Canada's wheat trade policies and practices.

The U.S. government has decided to go ahead with a Section 301 investigation targeting Canadian government policies and trading practices of the Canadian Wheat Board (CWB).

The possibility of an investigation arose Sept. 8 when the North Dakota Wheat Commission (NDWC) filed a petition with the United States Trade Representative (USTR). The NDWC sees such an investigation as a step toward the U.S. government placing import restrictions on Canadian wheat and acting to counter CWB pricing practises in third market countries.

The initiation of an investigation does not mean that the U.S. government is taking trade action. Canada will continue to press the U.S. not to restrict Canada's market access or otherwise interfere with the CWB's legitimate pursuit of the best returns available for Western Canadian wheat producers. The Government of Canada stressed that any action that fails to respect Canada's North American Free Trade Agreement (NAFTA) and World Trade Organization (WTO) rights will be challenged.

Eight separate U.S.-initiated investigations and audits since 1990 have confirmed that the CWB operates in compliance with international trade rules.

The USTR has up to one year to complete the investigation and announce what, if any, action will follow.