US Commerce Dept reduces tariff on Canadian paper used by

The US Commerce Department on Thursday said it would make permanent but also reduce a tariff on Canadian paper used by the US newspaper and publishing industry.

The anti-dumping duties, which had been as high as 22.16 percent, will be capped at 16.88 percent, the department said. Two of the Canadian companies accused of dumping their paper in the US will face no duties.

The US imposed the preliminary tariff in March on uncoated groundwood paper imported from Canadian mills and used as newsprint by the US newspaper industry.

US publishers, printers and members of Congress from both parties opposed the tariffs. They also have been opposed by the association representing the American paper industry and other paper mill owners in the US and Canada. The US newspaper industry said the tariffs increased newsprint prices by 25 to 30 percent. Newsprint often is the second-biggest operating expense, after salaries, for most newspapers.

The increase in newsprint costs caused many newspapers in the US to reduce page count and content. The Tampa Bay Times, a regional paper in Florida, said it was cutting up to 50 jobs because of the soaring paper cost.

Commerce Secretary Wilbur Ross said Thursday that the department would also revise downward its preliminary ruling that Canada provides unfair subsidies of between 4.42 and 9.93 percent to its mills that produce the paper. The new rates will be between 0.82 and 9.81 percent.

"This was a complicated and unique case," Ross said in a statement. "The department worked hard to address the arguments raised, and I am satisfied that the final determinations appropriately targets bad actors."

The Commerce Department approved the preliminary tariff in response to a complaint from a single paper mill, North Pacific Paper Co in Washington state, which said Canadian paper manufacturers were being subsidized by their government and were therefore able to offer lower prices, giving them an unfair advantage over their US counterparts. The US mill, which was bought in 2016 by New York hedge fund One Rock Capital Partners, is one of five left in the United States.

The International Trade Commission could still reduce or eliminate the tariff. Almost 20 members of Congress and representatives of the newspaper industry testified to the commission last month that the tariff posed a threat to the future of local newspapers across the nation.

The independent federal agency is due to rule on the case in late August.