Dumping row flares again

PUBLISHED : Friday, 21 May, 1993, 12:00am
UPDATED : Friday, 21 May, 1993, 12:00am

THE US is back-tracking on its landmark decision on anti-dumping - awarded in favour of Hongkong last November after a time-consuming and costly battle backed by the Government - by launching a surprise second round of investigations.

In what was hailed as a major victory for Hongkong last November, US agency the International Trade Commission (ITC) reversed its earlier ruling that the territory had hurt American sweater manufacturers by dumping cut-rate products in the US.

It was hoped that ruling would clear the way for an end to the bitter three-year dispute which led to anti-dumping tariffs against Hongkong and other Asian sweater exporters.

Now it is understood America plans to continue its investigations, and that a second round of questionnaires covering the period from September 1991 to August 1992 will go out to the eight local sweater exporters caught up in the row.

Textile Council executive director Kenneth Yeung Ting-ho said: ''The court has ruled that the whole action is not justified, so why should there be an annual review of the action? ''They should be withdrawing it, or cancelling it, or terminating it.

''From our point of view this should be stopped, because there has been a court ruling.'' He said the picture was muddied by an appeal which still hung over the final decision, but that until this was decided upon a course of normal action should be pursued.

Initially questionnaires went out to the three exporters named by the US authorities - Comitex Knitters, Shanghai Knitwear and Wing Ho Knitwear - along with three unnamed firms, plus Hayward Knitters and LaMagma, which volunteered.

They were backed, in the time-consuming and costly business of responding, by the Hongkong Trade Development Council, which injected some $5 million into a $10 million fighting fund to pay legal fees.

TDC director-general Dennis Yau Tat-wang said: ''We will be discussing with the Textile Council to see at this stage what kind of support is necessary from the TDC. We would have to look at those requests as they are presented to us.

''The anti-dumping case is against individual companies. In this case the Textile Council as an umbrella organisation will be co-ordinating efforts and providing assistance to individual companies putting up an effective defence.

''If there is any way the TDC can help we will do that, but we need to see what kind of assistance is required.'' Exports of acrylic sweaters to the US had fallen significantly since the US anti-dumping action was launched in 1989, according to Trade Department officials.

The value of synthetic fibre sweater exports to the US, which totalled $809 million in 1989, slid to $564 million in 1990 - the year dumping duties were imposed.

The dispute began in 1989, when the US National Knitwear and Sportswear Association (NKSA) accused Hongkong, Taiwan and South Korea of dumping man-made fibre sweaters at below cost to capture the US market.

In a series of rulings, the ITC found all three Asian exporters guilty of injuring US competitors, while the Commerce Department ruled that Hongkong had sold sweaters at 5.86 per cent below cost; South Korea at 1.4 per cent; and Taiwan at 21.38 per cent.

The US imposed punitive tariffs on all three, equivalent to their respective dumping percentages. The high tariffs on Taiwan killed off its acrylic sweater exports to the US.

However, Hongkong sweater firm Comitex Knitters challenged the penalties, taking the case to the trade court and winning the rulings against the ITC and the Commerce Department.