By David Lawder

(Reuters) – Canada won a dispute against U.S. solar tariffs in the trade pact. This was ahead of scheduled talks with Washington.

Mary Ng, Canada’s minister of trade and export promotion, said in a statement that she welcomed the findings of a U.S.-Mexico-Canada Agreement dispute settlement panel, “which unequivocally confirmed that U.S. tariffs on Canadian solar products are unjustified and in violation” of the trade pact.

In January 2018, the former U.S. president Donald Trump imposed “Section 201,” safeguard tariffs on imports of solar cells and panels. However, Canada and Mexico were not exempt from these duties. Canada claimed that tariffs were in violation of USMCA’s terms, which exempts North American partners from most tariffs. It sought to have a panel for dispute resolution last year.

The U.S. Trade Representative’s Office spoke out to say that the United States won on certain aspects of the panel decision.

“The U.S. appreciates that the panel reaffirmed the President’s authority to make exclusion determinations in safeguard proceedings,” USTR spokesman Adam Hodge said in a statement. We will review this report again and continue working with Canada in order to settle the dispute.

This month, President Joe Biden extended tariffs by four more years. But in a significant concession to installers, he relaxed terms to exempt a panel technology which is dominant on big U.S. project.

Biden called on Canada and Mexico for negotiations to “not undermine the effectiveness of the tariffs,” which are largely targeted at subsidies of Chinese production.

Canada and Mexico have been exempted from U.S. duties on aluminum and steel first imposed Trump. But those agreements also contain provisions that aim to stop “surges” in imports as well as products transshipped out of other countries.

Ng indicated that she accepted the U.S. invitation to talks and said, “Canada would work towards the total removal of these unfair tariffs.”