U.S.-Korea Free Trade Agreement: Potential Economy-wide ... - USITC

In another departure from previous FTAs, section C would provide for the establishment of
a Committee on Trade Remedies, comprising representatives from each party who have
responsibility for trade remedies matters, including antidumping, subsidies and
countervailing measures, and safeguard issues. The functions of the Committee would
include enhancing knowledge of each other’s trade remedy laws, policies, and practices;
overseeing implementation of the chapter, including compliance with paragraphs 3 and 4 of
Article 10.7; improving cooperation between the parties’ agencies having responsibilities for
trade remedies matters; providing a forum for the parties to exchange information on issues
relating to antidumping, subsidies and countervailing measures, and safeguards; establishing
and overseeing development of educational programs related to the administration of trade
remedy laws for officials of both parties; and providing a forum for the parties to discuss
other relevant topics of mutual interest. These relevant topics would include international
issues related to trade remedies (e.g., issues relating to the WTO Doha Round rules
negotiations), practices by the parties’ competent authorities in antidumping and
countervailing duty investigations (such as application of “facts available” and verification
procedures), and practices of a party that may constitute industrial subsidies. Section C
would require that the Committee meet at least once per year.
Views of Interested Parties
The Industry Trade Advisory Committee on Steel (ITAC 12), whose members include U.S.
producers of steel products, stated in its report on the agreement that it strongly objects to
the new AD-CVD provisions, and asserts that they could weaken U.S. trade law, threaten to
politicize the AD-CVD process, and set a dangerous precedent for future FTAs. 3 In
particular, ITAC 12 stated that the current trade remedy process in the United States is
already transparent and that the preinitiation notification and consultation requirement would
merely serve to delay and politicize the process, particularly in antidumping investigations. 4
The report objected to the provisions in paragraph 4 of Article 10.7 regarding undertakings.
It asserted that such “undertakings” will encourage the use of suspensions and the
introduction of foreign governments into domestic trade law procedures. The report also
objected to the establishment of a Committee on Trade Remedies, stating that such a forum
will give Korea the opportunity to try to further weaken U.S. trade remedy law. 5
In separate statements, the Weldbend Corporation, a U.S. producer of carbon steel butt-weld
pipe fittings and flanges, the American Dehydrated Onion and Garlic Association, and the
Labor Advisory Committee (LAC) expressed concern that the agreement’s rules of origin
may encourage producers in China and possibly other Asian countries to circumvent U.S.imposed
antidumping orders by transshipping products (including steel products such as pipe
fittings and flanges and dehydrated garlic) to the United States through Korea. 6 LAC asserted
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afford “due consideration and adequate opportunity for consultations” to the other party, and exporters of the
other party regarding proposed undertakings on price, or, as appropriate, on quantity, which, if accepted, may
result in suspension of the investigation without imposition of countervailing duties, through the means
provided for in the party’s laws and procedures.
3 ITAC (12) on Steel, Advisory Committee Report, April 27, 2007, 7.
4 Ibid., 3.
5 Ibid., 4.
6 Weldbend Corp., testimony before the USITC, April 27, 2006, 12–13; American Dehydrated Onion and
Garlic Assoc., testimony before the USITC, 6; and LAC for Trade Negotiations and Trade Policy, Report,
April 27, 2007, 22 and 28.
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