We've ben waiting on this for some months and now the US Commerce Department has said that both LG and Samsung dumped refrigerators at low cost, in a case brought by Whirlpool Corp. The agency set duties of as much as 36.65%.
Samsung of, South Korea, faces a tariff 36.65 percent for refrigerators produced in Mexico and 32.2 percent for those from South Korea based on the preliminary findings, the department said today in a statement. LG Electronics will pay 16.44 percent for products made in Mexico and 4.09 percent on South Korea units. Dumping refers to selling a product at a discount in a foreign market.
The decision “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 Kristine Vernier, a spokeswoman for Whirlpool, the world’s largest appliance maker. “Maintaining jobs in the United States requires restoring fair competition through the strong enforcement of United States and international trade laws.”
The bottom-mount models covered by the decision have the freezer below the refrigerator section and are more energy efficient, according to Whirlpool. Imports of refrigerators of all types were valued last year at $2.3 billion from Mexico and $881 million from South Korea, the Commerce Department said today.
The investigation found Daewoo Electronics Corp. of Seoul hadn’t been dumping the appliances, according to the Commerce Department statement.
The Commerce Department, in a separate preliminary investigation, found that Chinese companies are dumping steel wheels, and set duties from 110.58 percent to 193.54 percent.
Accuride Corp. of Evansville, Indiana, and Hayes Lemmerz International Inc. of Akron, Ohio, filed petitions seeking the duties on the steel wheels, the department said today in an e- mailed statement.
We wouldn't be surprised, like the patent wars going on, that this sort of action will spread in tit-for-tat squabbles in both the US and other markets, the most likely to be the EU.
In the meantime, unsurprisingly, both Samsung and LG have thrown their teddies out their respective prams in statements that they have issued as below.
Samsung Press Release
Samsung is disappointed with the U.S. Department of Commerce's preliminary findings regarding a segment of the refrigerator market, bottom-mount refrigerators, produced by Samsung in Korea and Mexico. Samsung disagrees with the preliminary findings, and is confident that once the full investigation is concluded, the Department of Commerce will determine that Samsung is in compliance with U.S. trade laws.
The Department of Commerce took exception to the manner in which Samsung provided certain information and, as a result, made adverse assumptions in its calculations of the antidumping margins. However, the Department of Commerce has requested that Samsung provide the needed information in a different form, which it has agreed to consider before issuing its final determinations. We believe that Samsung is in compliance with U.S. trade laws, and we intend to present factual data and information to that end during the full investigation.
Samsung's market leadership is built upon our innovative technologies and products, which satisfy the highest standards in design, performance and quality. We expect our business to continue to thrive due to our delivery of an excellent product experience to consumers.
LG Press Release
LG Electronics and its affiliates will aggressively contest the dumping allegations and the methodologies used by the U.S. Department of Commerce in its preliminary determinations in the ongoing antidumping duty investigations of bottom mount refrigerator-freezers imported from Korea and Mexico.
In those determinations, the Commerce Department preliminarily found that LG Electronics USA, Inc. (LGEUS) and its affiliates LG Electronics, Inc. (LGE) and LG Electronics Monterrey Mexico (LGEMM), sold bottom-mount combinations refrigerator-freezers at dumped prices in the United States.
LGEUS, LGE and LGEMM strongly disagree with the DOC's findings and believe these findings will be reversed in the final determination to be issued in March 2012. Dumping exists if the prices to the U.S. market are lower than the prices in the comparison market.
Specifically, the Commerce Department calculated dumping duty rates of 4.09 percent for LGE and 16.44 percent for LGEMM. 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 theMexico 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.
LGEUS, LGE, and LGEMM have worked hard over the past seven months to provide the Department with extensive and accurate data required under the U.S. antidumping duty laws. "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.
At the same time that the Commerce Department issues its final determination in the antidumping duty investigations, it will issue a final determination in the countervailing duty investigation brought by Whirlpool Corporation regarding illegal subsidies obtained with respect to imports of bottom mount combination refrigerator-freezers from Korea. In that case, the Commerce Department issued a negative preliminary determination on August 30, 2011 based on its finding that any governmental benefit LGE may have obtained was negligible. Specifically, Commerce calculated a countervailing duty rate of 0.05 percent, well under the minimum actionable threshold of 1.0 percent.
LGE is a respondent in all three investigations and is confident that the Department's final determinations in these cases will demonstrate that Whirlpool's dumping and countervailing duty allegations are equally without merit and that LGE and its Mexican affiliate, LGEMM, have not dumped bottom-mount refrigerators in the United States.