It seems that no one--not even the winner--is satisfied with the International Trade Commission's ruling that Japanese and German manufacturers have been dumping large printing presses in the United States at below fair value.
Each of the four foreign manufacturers now subject to tariffs filed a summons with the Court of International Trade by the Oct. 4 deadline, indicating their intent to appeal the rulings by the ITC and the U.S. Department of Commerce. And despite the fact that the decision was a major victory for Illinois-based Goss Graphics Systems, it too plans to challenge the ruling.
Prompted by a very large sale of presses by Mitsubishi Heavy Industries to The Washington Post, Goss (then Rockwell Graphic Systems Inc.) initiated the anti-dumping proceedings in the summer of 1995. It charged that four German and Japanese press manufacturers were dumping their products at less than fair market value, thus causing injury to the domestic printing-press industry.
Commerce and ITC agreed, and in August ITC ruled that tariffs ranging from 31 to 63 percent would be levied against Mitsubishi, TKS, KBA-Motter and MAN Roland. ITC found no current injury to Rockwell but believed it would likely be harmed in the future. Those following the case believe this is the reason for Rockwell's appeal--the company wants to prove current as well as probable future injury.
Following its notice of intent to appeal, each company was expected to file its substantive complaint with the trade court during the first week of November. At press time, it was not known if this would include a request to restrain the ITC from imposing the hefty tariffs prior to the ruling on the appeal.
This is how the dumping penalty would work: When a press comes into this country, the U.S. importer of record is liable for the additional duty set by the commission, such as Mitsubishi's 62.9 percent or KBA's 46.4 percent of the purchase price. The importer, likely an American subsidiary of the foreign manufacturer, posts a bond for the tariff.
The bond is, in reality, a potential expense. One year after the effective date of the ruling (February 1996), each individual sale is reviewed and the government re-imposes a duty that represents the difference between the sale price and the fair market value. At that time, the bond could be called in if it matches the initial percentage levied, says Lynn Featherstone, head of the ITC investigations unit. If it is found to be lower, a refund would be issued.
A very simple example: A press is sold to a U.S. customer by a foreign manufacturer for $2.5 million, and a duty of 46 percent, or $1.15 million, is levied. After the sale is reviewed, the fair market value of the press is determined to be $3 million. The actual dumping penalty then becomes $0.5 million ($3 million minus $2.5 million). Since this is less than the $1.15 million bond originally posted, the government keeps only the $0.5 million and refunds the difference of $0.65 million to the importer.
If the press makers' appeals are not successful, Commerce will impose duties on all press sales dating back to the its preliminary determination on Feb. 26. Since virtually no presses or additions have been imported since then, the duties effectively apply only to future sales.
NAA testified on behalf of its members at a July 17 hearing before the ITC and may file an amicus brief with the New York trade court in opposition to the duties. NAA argued that competition for improved design is essential to the welfare of the newspaper industry because advertisers and readers are demanding more color, better color and a level of tailored content that exceeds the capability of currently installed presses.
NAA also argued that increased environmental and safety concerns and the staggering cost of newsprint reinforce the need for more efficient and flexible press designs, regardless of the country of origin.
Kim D. Currow, staff attorney with NAA, says more information will be available over the next several months as manufacturers detail their complaints before the court.
Judy Grande is a free-lance writer in Great Falls, Va. E-mail, RockyRun91@aol.com; phone, (703) 759-0276.
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