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(collectively, related entities) owned approximately 110,000
acres of woodland in Maine and other States.
Petitioner’s Business Activities
Most of petitioner’s business activities relate to the
cutting of timber4 and transporting the resulting “wood product”5
(logs or wood) to the appropriate mills. Petitioner supervised
the cutting of timber on its own land and on land owned by
others.
Petitioner had contracts and arrangements with approximately
100 mills. Under the contracts and arrangements, petitioner
agreed to deliver logs to the mills for an agreed-upon price.
These mills were located in Maine, Vermont, New Hampshire,
Quebec, and New Brunswick.
For example, in petitioner’s contract with International
Paper Co., petitioner agreed to sell specified quantities of logs
and wood (such as pulpwood, sawtimber, poles, and piling) to
International Paper Co. for a set price. The duration of the
contract was 6 months, divided into six 1-month order intervals.
4 The parties define “timber” as standing trees containing
wood available and suitable for marketing and use. “Hardwood” is
defined as broadleaved, deciduous trees. “Softwood” is defined
as trees that have needles, such as pine, spruce, and fir.
“Stumpage” is defined as a standing tree, and “stumpage value” is
defined as the “economic value of standing trees”. “Pulpwood” is
defined as “paper wood” or “smaller timber that is chipped up and
used primarily to make paper”.
5 Once timber is cut, it becomes a “wood product”.
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Last modified: May 25, 2011