ROSSLYN, Va., June 27, 2018—The National Electrical Manufacturers Association (NEMA) welcomes diligent administration by the U.S. Commerce Department of an ongoing anti-dumping order on large power transformers from South Korea. NEMA and domestic producers of the large power transformers support the strong enforcement action by the Department ensuring that imports of large power transformers from Korea are fairly traded or properly subject to appropriate antidumping duties.
"NEMA supports free and fair trade and the appropriate use of our trade laws," says NEMA President and CEO Kevin Cosgriff. "Large power transformers are essential components of the electric grid that control the high-voltage flow of our nation's electricity. As such, a strong domestic manufacturing base for this equipment is indispensable."
NEMA represents, in part, U.S. manufacturers of large power transformers.
On May 31, 2018, the Commerce Department published a preliminary decision that Hyundai Electric & Energy Systems Co., Ltd. (HEES) is the successor-in-interest to Hyundai Heavy Industries Co., Ltd. (HHI) for purposes of the antidumping duty (AD) order on large power transformers from South Korea. As a result, HEES will have to pay the entry cash deposit rate to import transformers subject to the AD order at HHI's anti-dumping duty rate of 60.81 percent ad valorem.
In its two most recent reviews of the AD order, which was put in place in 2012, the Department concluded that HHI had not cooperated with the agency's requests for information and assigned HHI 60.81 percent as an adverse rate for its failure to cooperate. Since HEES spun off from HHI in April 2017, HEES has been claiming a lower 22.00 percent rate for its entries of subject merchandise into the U.S., claiming that it is a new entity distinct from HHI. The Department's preliminary finding makes clear that HEES must pay the adverse rate of 60.81 percent instead of the lower rate.
Furthermore, the Department will require retroactive cash deposits from HEES at the 60.81 percent rate, meaning that HEES must deposit the difference between the 22.00 percent rate and the 60.81 adverse rate for any entries it made since its inception (in April 2017) through the date of the Department's final decision, which is anticipated to be published sometime in the fall of 2018.
This is the first time that the Commerce Department has required a retroactive cash deposit payment under a changed circumstances review of an AD order. In its published decision, the agency explained that the "unique" circumstances of this situation (HHI's decision to spin-off HEES and then enter merchandise at a lower rate) is undermining the efficacy of the AD order and is depriving the domestic industry of the full magnitude of the remedy.
Electrical Manufacturers Association (NEMA) represents nearly 350 electrical
equipment and medical imaging manufacturers that make safe, reliable, and efficient products
and systems. Our combined industries
account for 360,000 American jobs in more than 7,000 facilities covering every
state. Our industry produces $106 billion shipments of electrical equipment and
medical imaging technologies per year with $36 billion exports.