The federal government won't meet its self-imposed Sunday deadline to implement the softwood lumber agreement with the United States, International Trade Minister David Emerson confirmed Wednesday.

Complications surrounding the withdrawal of more than 30 pieces of trade litigation, including resistance by some exporters to shelving their lawsuits, make it unlikely a planned softwood border tax will start being levied as of Sunday.

Sources in Ottawa, Washington and the Canadian lumber industry told the Canadian Press the minority Conservative government won't be ready to implement the deal by the Oct. 1 date set out in its softwood legislation.

"We have simply responded to the industry's needs to work through this process, but everybody's keen to get the thing done and moving ahead as quickly as possible," Emerson told Kamloops, B.C., radio station CHNL.

"We're trying to be flexible and not be seen as bullying or being unreasonable. We're trying to do what's best for the industry."

The U.S. government demanded as part of the agreement that all trade litigation be withdrawn as a precondition for lifting punitive lumber duties.

The softwood agreement reached July 1 doesn't contain a specific date for coming into force, but Ottawa set Oct. 1 to implement the deal, which includes replacing U.S. duties with a Canadian export tax.

But industry sources say a number of Canadian lumber exporters, including at least one large company, have refused to sign letters agreeing to withdraw their cases pending in U.S. trade courts.

Others need more time to review the terms for abandoning their cases, a move the deal's critics have said would void five years of Canadian legal victories that would have inevitably killed the U.S. duties.

Emerson's communications director, Bob Klager, said the government was advised through consultation with the industry about difficulties in implementing the agreement.

"Government right now is looking at what we can do to assist industry with the complexities of this implementation process," he said.

If Ottawa had moved ahead as planned and the U.S. duties remained in place, it raised the possibility lumber shipments would face a 15-per-cent export tax as they leave Canada and a 10.8-per-cent import duty when they cross into the United States.

However, Klager indicated lumber exporters won't face the prospect of paying the export tax and the duties simultaneously.

"The fact is all the aspects of the agreement are meant to dovetail," he said. "The suggestion … the duty orders could still be in place while an export tax is being levied, it just wouldn't happen."

A source said the industry has been assured Ottawa won't begin levying the export tax Sunday.

Klager said more information would come out later this week.

A U.S. government source said Washington is co-ordinating with Ottawa, adding, "I think it's fair to say that I think the deadline might slip.

"I don't know if it's complications. I think it just takes time."

Klager said the delay should not affect the government's plans to start distributing more than $4 billion US in American duty refunds by December.

The agreement makes Ottawa responsible for the process, which includes funnelling $1 billion US in duties back to the U.S. government and American lumber producers.

Industry sources said officials in International Trade's softwood lumber division have been calling holdout companies and pressuring them to sign letters withdrawing their trade cases.

One of those officials confirmed to the Canadian Press that companies were being called, but would not discuss how many were refusing.

Elliot Feldman, a Washington trade lawyer acting for several lumber firms, said one client was misled by being told he was one of the last holdouts.

"Of the companies we represent, he's one of 19," he said.

But other softwood litigants simply want more time to sort out the legal ramifications of shelving their cases.

John Allan, president of the B.C. Lumber Trade Council, which is a party to some of the litigation, said the group is committed to quick implementation of the agreement, but a limited extension is needed to satisfy all its requirements.

"I look at the agreement and I think there's something like 33 cases requiring 53 signoffs," he said in an interview. "You just don't unwind five-plus years of litigation without going through a lot of due process."

Allan said the council, which represents much of the dominant B.C. lumber sector, will look for clarification on whether Ottawa will start levying the tax Sunday.

"We'll be following up on that, but I'd expect the duties to stay in place and that the border tax would not be paid," he said.

Meanwhile, the U.S. Coalition for Fair Lumber Imports, the American producer lobby behind the duties, has indicated it's ready to fulfil a key Canadian demand that it drop a constitutional challenge of the NAFTA dispute-resolution process that gave Canada significant legal victories in the dispute.

"The agreement contemplates that the coalition will withdraw the constitutional challenge when the agreement comes into effect," coalition spokesman Zoltan van Heyningen said. "The coalition is prepared to proceed on that basis."

The legal tangle isn't the only question mark hovering over the softwood agreement's implementation.

The government got the necessary authority to proceed through a ways and means motion passed in the House of Commons last week.

The complete softwood package — Bill C-24 — will take longer to work its way through Parliament and likely won't be passed for several weeks at the earliest.

Some observers have raised questions about the bill, including an indication there's no provision to reimburse companies for a "special charge" levied to ensure companies that refuse to sign over about 20 per cent of their duty refunds to the U.S. government and lumber industry receive more money than exporters that do.

On its lumber web site, International Trade says companies that sign duty-deposit waivers can apply for a refund of the up-front tax. But Feldman said the bill itself doesn't mention it and in fact rules out any refunds not spelled out in the legislation.

Others also wonder about sections that give the government the power to conduct warrantless searches of lumber exporters — presumably to ensure they're abiding by the deal's reporting provisions.