VANCOUVER (Reuters) - The Canadian government said on Tuesday it is "deeply concerned" by a State of Alaska effort to apply 'Buy America' rules to a ferry terminal being built in a remote northern British Columbia port town.
Under Buy America provisions, Canadian iron and steel products cannot be used in the up to $15 million rebuild of the Prince Rupert ferry terminal, located just south of the Alaska border, despite the fact that the project is in Canada.
The terminal is owned and operated by Alaska's Department of Transportation, which leases the land from the Prince Rupert Port Authority. The replacement project is being funded by the U.S. Federal Highway Administration.
"We are aware of and deeply concerned by the attempt by the U.S. to apply 'Buy American' restrictions to a project at the Port of Prince Rupert, British Columbia," said Ed Fast, Canada's Minister of International Trade, in a statement.
"The extraterritorial application of these protectionist restrictions on trade within Canada by a foreign government is unreasonable."
Fast compared the issue to a bridge in the town of Morrison, Colorado, which was nearly dismantled earlier this year when it was discovered that it was built using steel beams made in Canada. The U.S. government eventually backed down in that case.
Canada has repeatedly said that protectionism is a bad policy and hurts business on both sides of the border.
The new Prince Rupert ferry terminal, to be completed in 2016, is part of a long-term lease signed last year between the Prince Rupert Port Authority and the Alaska Marine Highway System, which runs ferries between Alaska and Prince Rupert.
An undated call for bids posted on an Alaska government website clearly states that the project falls under Buy America provisions, meaning foreign-made products cannot be used.
A spokesman for the Alaska Marine Highway System contacted by Reuters after office hours was not immediately available for comment.
Reporting by Julie Gordon; Editing by Tom Hogue