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Majap Makers Facing Stiff Tariffs

Washington – Offshore majap makers are facing possible double-digit
import duties on bottom-mount refrigerators following yesterday’s determination
by the U.S. Department of Commerce (DOC) that the products were sold in the
U.S. at below-market prices.

The year-long investigation was

by Whirlpool

, which filed anti-dumping and countervailing duty petitions last
March against Electrolux, LG Electronics, Samsung and Mabe, a Mexican OEM that
produces appliances for GE.

Among other claims, Whirlpool had cited “substantial unfair
subsidies given by the Korean government to Samsung and LG in the past few
years,” although the DOC dropped its countervailing duty claim against LG
yesterday after finding that the company’s refrigerators are not illegally

The case now goes before the U.S. International Trade Commission
(ITC), an independent, quasi-judicial federal agency, which will make a final determination
in April. If the ITC supports the DOC’s determination, duty deposits could be
required from the four vendors as early as May.

Based on the DOC’s dumping margin findings, the import duties may
be as high as:

  • 30.34 percent for LG’s Mexican-assembled fridges
    and 15.41 percent for those made in Korea;

  • 15.95 percent for Samsung’s Mexican-assembled
    fridges and 5.16 percent for those made in Korea;

  • 22.94 percent for Electrolux’s Mexican-assembled
    fridges; and
  • 6 percent for Mabe-made products.

In a separate case related to bottom-mount refrigerators from
South Korea, the DOC found dumping margins of 12.9 percent for exports by
Daewoo and 2.46 percent for exports by Samsung.

In response to the ruling, LG and Samsung claimed the DOC used a
discredited comparison methodology called “zeroing” that inflated the margin

LG also claimed that the DOC erroneously compared U.S. prices of
Mexican refrigerators to the prices in Korea for a highly specialized line of
Korean refrigerators designed primarily to store kimchi, a Korean food
specialty, which highly inflated the antidumping duty margin for its
Mexican-made fridges.

Chris Jung, president of Home Appliances for LG Electronics USA,
promised to “continue to aggressively contest the antidumping duty findings
through every means possible in order to obtain determinations that fully and
accurately reflect [LG’s] pricing in the U.S. market.”

Samsung said it is “disappointed” with the DOC’s determination,
which it claims is based on “flawed methodologies.

“The use of zeroing created an antidumping margin where dumping
did not occur,” the company said.  “We
are disappointed that the Commerce Department continues to use this discredited
methodology,” which has been found in several instances to violate World Trade
Organization standards upon which the antidumping duty laws are based.

 “Although Samsung will do
everything we can to mitigate any impact of this decision on our business and
customers, American consumers stand to lose the most from today’s
determination,” Samsung said.

The company also reiterated its “long-term commitment” to its
U.S. majap business.

Neither Electrolux nor GE Appliances responded to TWICE’s request
for comment by post time.

For its part, Whirlpool said it “remains confident that the
successful conclusion of these investigations will lead to trade remedies against
unlawfully traded bottom-mount refrigerators from South Korea and Mexico.”

Added Whirlpool North America president Marc Bitzer: “We are
pleased with the Department of Commerce’s decisions.”

In a


, the U.S. ITC said last month that it found preliminary
evidence of predatory pricing on certain large-capacity washers imported from
Korea and Mexico by LG and Samsung. The investigation is expected to run
through next February.