Commerce Department: Samsung, LG, Others Are Dumping Fridges on U.S. Market
Oct 28, 2011
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A preliminary determination by the U.S. Department of Commerce International Trade Administration (ITC) found that four appliance makers from Mexico and two from South Korea have been dumping bottom-mount refrigerators on the U.S. market, in violation of United States and International trade laws.
In the Mexico investigation, mandatory respondents were Mabe (Controladora Mabe S.A. de C.V. /Mabe S.A. de C.V.); Electrolux (Electrolux Home Products, Corp. NV/Electrolux Home Products De Mexico, S.A. de C.V.); LG Mexico (LG Electronics Monterrey Mexico, S.A. de C.V.; and Samsung Mexico (Samsung Electronics Mexico S.A. de C.V.).
In the preliminary determination, the Commerce Department found company-specific dumping margins for four Mexican producers:
• Samsung - 36.65%
• LG - 16.44%
• Mabe - 36.21%
• Electrolux - 19.80%.
In the preliminary determination, the Commerce Department also found company-specific dumping margins for two Korean producers:
• Samsung 32.20%
• LG 4.09%
A Fact Sheet issued on October 27, 2011, by the Department of Commerce said: "We found that Samsung Korea did not act to the best of its ability by failing to submit useable data with respect to its sales of certain products subject to the investigation, sales which constituted the overwhelming majority of Samsung Korea’s home market sales."
The Department of Commerce also investigated Korean appliance maker Daewoo and found a preliminary dumping rate of 0.00%.
The investigation was launched after Whirlpool Corporation filed an anti-dumping complaint.
As a result of the Commerce Department's action today, affected importers will be required to post bonds as security for future payment of anti-dumping duties if United States' wholesale sales prices on bottom-mount refrigerators are not raised to fair value.
The Commerce Department is halfway through its investigation, and will seek further information from the companies being investigated, including from LG and Samsung. The Commerce Department will also conduct an audit before the final determination. The final ruling is intended to accurately measure the respective levels of dumping and help determine what duties should be assessed by the United States government against United States imports from South Korea and Mexico of bottom-mount refrigerators.
Whirlpool Feels Validated
"The Commerce Department's preliminary finding of dumping validates the legal actions we are taking to protect our 23,000 employees in the United States and the communities in which they work," said Whirlpool Corp. spokesperson Kristine Vernier. "When foreign companies like Samsung and LG violate trade laws, they destroy the ability of United States producers to invest, innovate, and create jobs here in America. Whirlpool Corporation spends $7.4 billion each year in the United States to offer innovative products consumers are seeking. Of the products we make, more than 80% of what we sell in America is built in America. Maintaining jobs in the United States requires restoring fair competition through the strong enforcement of United States and International trade laws."
LG Intends to "Aggressively Contest" Dumping Allegations
LG Electronics quickly issued a statement saying it will "aggressively contest" the dumping allegations and the methodologies used by the U.S. Department of Commerce to reach its preliminary determinations.
The LG statement said that, "Based on a rarely used provision in the antidumping duty laws, the Commerce Department erroneously compared U.S. prices of Mexican refrigerators to the prices for Korean refrigerators in Korea, which highly inflated the antidumping duty margin in the Mexico case. Margins in both cases were further inflated by the Department's use of another comparison methodology (called "zeroing") which has been held to violate World Trade Organization standards upon which the antidumping duty laws are based."
"We are confident that LGE will prevail in the final determination, which will demonstrate that bottom mount refrigerators have not been dumped in the United States," said Wayne Park, president and CEO, LG Electronics USA.
The ITC is scheduled to make its final injury determinations on or about April 30, 2012.
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