Quotas on Canadian softwood lumber and the return of a significant portion of punishing U.S. duties are part of a complex framework agreement officials from both sides were hammering out in around-the-clock discussions, Canadian Television reported.

As part of the agreement, Canadian lumber firms would be held to a 34 percent share of softwood lumber in the U.S. market, which is roughly Canada's current share.

The U.S. would return 78 percent of the 5 billion Canadian dollars(4 billion U.S. dollars) it collected in anti-dumping and countervailing duties beginning in 2002.

The remaining 22 percent would likely go to the U.S. lumber industry to help defray the costs of their legal challenges.

The news is expected to be confirmed by the industry ministry later Wednesday, said the report.

The two nations have been battling in trade court over tariffs and quotas ever since Washington slapped duties on Canadian softwood lumber more than four years ago.

The U.S. had long argued that Canadian softwood exports were subsidized and priced at below the real cost of production.

In May, 2002, the U.S. government began to slap a 27.2 percent tax on Canadian softwood. Since then, U.S. Customs have collected 5 billion Canadian dollars(4 billion U.S. dollars) in duties. Enditem