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Parts and materials technology development
426th Korea Trade Commission gives preliminary determination on anti-dumping investigations 2022-07-26

The Ministry of Trade, Industry, and Energy (MOTIE) held the 426th Korea Trade Commission (hereinafter “Commission”) meeting on July 21, where Chairperson Chang Seung-wha announced a positive preliminary determination on anti-dumping investigations on imports of polyamide film from China, Thailand and Indonesia, as well as aluminum hydroxide from China and Australia, and proposed the imposing of provisional duties.

First of all, the Commission determined that the amount of evidence for dumping and substantial injury on domestic industries was sufficient, and gave a positive preliminary determination, deciding to propose provisional duties within the 5.08-46.71 percent range to the Ministry of Economy and Finance.

Noting that the above products imported from the aforementioned countries are imported at lower-than-normal prices, the Commission regards damage incurred on domestic industries as not insignificant, and intends to continue investigations for final determination through local inspections and public hearings.

The period subject to investigation shows that the volume and domestic market share of imported products increased while their prices decreased, eating into domestic counterpart products’ market share and operating profit. Thereby, the Commission decided to propose imposing provisional anti-dumping duties to prevent additional domestic injury.

With maximum thickness of 25㎛, stretched polyamide film offers superb heat and cold resistance, gas barrier properties and tensile strength, making it a popular packaging material for refrigerated, frozen or retort foods as well as medical products, laundry detergent, shampoo and secondary battery pouch cells.

As of 2021, the domestic polyamide film market amounts to KRW 70 billion (up to 20,000 tons), of which Korean products, products for investigation, and overseas products each take up 30 percent, 60 percent and 10 percent, respectively.

By country of origin, provisional anti-dumping duties are 5.08-5.18 percent, 24.81 percent, and 46.71 percent for China, Thailand and Indonesia, respectively. Imported products from Indonesia are imposed with a higher rate since Indonesian suppliers did not comply with anti-dumping investigation requirements, and the Commission has calculated their duty rate based on limited available documents, such as the investigation request form.

The Commission will give the final determination after its main investigation, including local and overseas inspections and public hearings over the following three months (can extend by 2 months).

Next, regarding the aluminum hydroxide imported from China and Australia, the Commission determined that the amount of evidence for dumping and substantial injury on domestic industries was sufficient to give a positive preliminary determination, and decided to go ahead with main investigations for a final determination.

During the period of investigation, not only were Chinese and Australian aluminum hydroxide imported at lower-than-normal prices, but the imported volume continued to rise while domestic sales price kept dropping, with Chinese and Australian products being sold at prices lower than their Korean counterparts. This caused further price falls, higher inventory-sales ratios and profit margin shrinkages.

Therefore, the Commission has decided to propose imposing provisional anti-dumping duties for aluminum hydroxide imported from China and Australia within the ranges of 14.27-21.05 percent and 37.96 percent, respectively.

Upon the Commission’s submission of the preliminary determination outcomes, the Ministry of Economy and Finance has one month to give a final decision.

Lastly, a Korean pharmaceutical company Vivozon requested investigations on unfair trade practices, claiming that another Korean company “A” has exported to Vietnam a numbing cream product that infringes on Vivozon’s trademark rights.

In response to this claim, the Commission has conducted investigations and determined that there exist export records within the last two years, and decided to launch unfair trade practices investigations.

The investigations usually take 6-10 months and involve document investigations, technical explanatory sessions and local inspections, after which the Commission will draw a final conclusion.

If unfair trade practices are recognized, company “A” would be required to carry out corrective measures, such as payment of fine or having its import and export privileges suspended.