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Glossy Paper From China, Indonesia to Face U.S. Anti-Subsidy Import Duties

The U.S. will impose dumping and anti-subsidy duties on glossy paper from Indonesia and China after the U.S. International Trade Commission ruled that domestic makers may be harmed by low-cost imports.

The panel’s 6-0 vote yesterday followed by hours a World Trade Organization decision that applying both sets of duties on China doesn’t violate trade rules. China has called the duties protectionist, while lawmakers and makers of steel, paper and textiles say they are crucial to countering what they call unfair trade practices.

“This decision by the ITC will help level the international playing field for our manufacturers and make it possible for our companies to sustain and create jobs,” Representative Michael Michaud, a Maine Democrat, said in a statement after the decision.

The ITC ruling is the final step needed to set tariffs on imports valued at $260 million of the glossy paper, used to print magazines and art books. NewPage Corp., Appleton Coated LLC and a unit of Sappi Ltd. sought the duties, citing China’s and Indonesia’s policies of debt forgiveness, cheap power and low-cost access to timber for domestic producers.

The dumping duties will reach as much as 135.83 percent for China and 20.13 percent for Indonesia, the Commerce Department said last month. Countervailing duties to offset subsidies will be as much as 17.94 percent for Indonesia and 178.03 percent for China, the agency said.

Preliminary Duties

The Commerce Department imposed preliminary duties in April and May. Paper importers have been depositing those duties pending action by the ITC. The panel’s decision sets the stage for the tariff rates to take effect within days.

Gold East Paper Jiangsu Co. must pay combined duties of 25.24 percent, the department said. Chinese companies not listed in the case face a 153.47 percent duty, according to the statement.

Asia Pulp & Paper, a unit of Indonesia’s Sinar Mas Group, must pay a 38 percent duty on its exports, according to a company statement.

“We are extremely disappointed in the commission’s decision,” said Terry Hunley, acting president for the company in the U.S. “We believe there are very strong grounds for appeal, and we will begin pursuing our appeal options immediately.”

China Leads Complaints

China, which faces the most unfair trade complaints worldwide, has criticized the U.S. decision to impose dumping and countervailing duties on imports from that country. The U.S. categorizes China as a non-market economy, which raises the anti-dumping duties its products face in the U.S.

In its case at the WTO, China argued that the U.S. was punishing its products twice by imposing both sets of duties.

The WTO judges rejected 8 of 11 complaints by China against U.S. duties on imports of steel pipes, some off-road tires and woven sacks in its decision announced in Geneva yesterday.

“This was a major victory for the U.S.,” said Alan Price, a lawyer at Wiley Rein LLP in Washington who has represented Nucor Corp. in trade cases.

To contact the reporter on this story: Mark Drajem in Washington at mdrajem@bloomberg.net.

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net.

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