03-18465. WTO Dispute Settlement Proceeding Regarding Countervailing Duty Investigation on Dynamic Random Access Memory Semiconductors (DRAMS) From Korea

AGENCY:

Office of the United States Trade Representative.

ACTION:

Notice; request for comments.

SUMMARY:

The Office of the United States Trade Representative (“USTR”) is providing notice that on June 30, 2003, the United States received from the Republic of Korea a request for consultations under the Marrakesh Agreement Establishing the World Trade Organization (“WTO Agreement”) regarding the U.S. countervailing duty (“CVD”) investigation on dynamic random access memory semiconductors (“DRAMS”) from Korea. Korea asserts that existing and future determinations made in this investigation, as well as related U.S. laws and regulations, are inconsistent with Articles 1, 2, 10, 11, 12, 14, 17, 22, and 32.1 of the Agreement on Subsidies and Countervailing Measures (“SCM Agreement”), and Articles VI:3 and X:3 of the General Agreement on Tariffs and Trade 1994 (“GATT 1994”). USTR invites written comments from the public concerning the issues raised in this dispute.

DATES:

Although USTR will accept any comments received during the course of the dispute settlement proceedings, comments should be submitted on or before August 28, 2003, to be assured of timely consideration by USTR.

ADDRESSES:

Comments should be submitted (i) electronically, to [e-mail], with “Korea DRAMS (DS296)” in the subject line, or (ii) by fax, to Sandy McKinzy at [phone], with a confirmation copy sent electronically to the address above, in accordance with the requirements for submission set out below.

FOR FURTHER INFORMATION CONTACT:

William D. Hunter, Associate General Counsel, Office of the United States Trade Representative, [phone].

SUPPLEMENTARY INFORMATION:

Section 127(b) of the Uruguay Round Agreements Act (“URAA”) (19 U.S.C. 3537(b)(1)) requires that notice and opportunity for comment be provided after the United States submits or receives a request for the establishment of a WTO dispute settlement panel. Consistent with this obligation, but in an effort to provide additional opportunity for comment, USTR is providing notice that consultations have been requested pursuant to the WTO Dispute Settlement Understanding (“DSU”). If such consultations should fail to resolve the matter and a dispute settlement panel is established pursuant to the DSU, such panel, which would hold its meetings in Geneva, Switzerland, would be expected to issue a report on its findings and recommendations within six to nine months after it is established.

Major Issues Raised by Korea

With respect to the measures at issue, Korea's request for consultations refers to the following:

• The affirmative preliminary CVD determination by the U.S. Department of Commerce (“DOC”), 68 FR 16766 (April 7, 2003);
• The affirmative final CVD determination by the DOC, 68 FR 37122 (June 23, 2003);
• The affirmative preliminary injury determination by the U.S. International Trade Commission (“USITC”), 67 FR 79418 (December 27, 2002);
• Any subsequent determinations that may be made during the USITC's injury investigation in DRAMS and DRAM Modules from Korea (Inv. No. 701-TA-431); and
• The related laws and regulations, including section 771 of the Tariff Act of 1930 and 19 CFR 351.

With respect to the claims of WTO-inconsistency, Korea's request for consultations refers to the following:

• The DOC failed to demonstrate the existence of a financial contribution by the Government of Korea.
• The DOC failed to examine each separate alleged government measure at issue in the investigation.
• The DOC failed to demonstrate that a benefit was conferred on the respondent Hynix Semiconductor Inc., given available market benchmarks.
• The “creditworthy,” “equityworthy,” and other analysis required by section 771(5) of the Tariff Act of 1930 and 19 CFR 351.
• Section 771(5) and (5A) of the Tariff Act of 1930 and 19 CFR 351 impose and the DOC applied an improper burden of proof on respondents and, in turn, the DOC did not base its decisions on affirmative, objective, and verifiable evidence.
• The DOC did not base its decision to initiate its CVD investigation on sufficient evidence.
• The DOC conducted various verification meetings over the explicit objection of the Government of Korea.
• The DOC imposed provisional measures based on a flawed analysis of financial contribution, benefit, and other factual and legal issues.
• The DOC failed to provide all relevant information on the matters of fact and law and reasons for its determinations.
• The DOC failed to conduct its investigation and make determinations in accordance with fundamental substantive and procedural requirements.

The consultation request does not refer to any WTO-inconsistent action by the USITC, nor does it refer to any WTO-inconsistencies with respect to those provisions of U.S. laws and regulations dealing with injury determinations in CVD investigations.

Requirements for Submissions

Interested persons are invited to submit written comments concerning the issues raised in this dispute. Persons submitting comments may either send one copy by fax to Sandy McKinzy at [phone], or transmit a copy electronically to [e-mail], with “Korea DRAMS (DS296)” in the subject line. For documents sent by fax, USTR requests that the submitter provide a confirmation copy electronically. USTR encourages the submission of documents in Adobe PDF format, as attachments to an electronic mail. Interested persons who make submissions by electronic mail should not provide separate cover letters; information that might appear in a cover letter should be included in the submission itself. Similarly, to the extent possible, any attachments to the submission should be included in the same file as the submission itself, and not as separate files.

A person requesting that information contained in a comment submitted by that person be treated as confidential business information must certify that such information is business confidential and would not customarily be released to the public by the submitter. Confidential business information must be clearly marked “BUSINESS CONFIDENTIAL” at the top and bottom of the cover page and each succeeding page of the submission.

Information or advice contained in a comment submitted, other than business confidential information, may be determined by USTR to be confidential in accordance with section 135(g)(2) of the Trade Act of 1974 (19 U.S.C. 2155(g)(2)). If the submitting person believes that information or advice may qualify as such, the submitting person:

(1) Must so designate the information or advice;

(2) Must clearly mark the material as “SUBMITTED IN CONFIDENCE” at the top and bottom of the cover page and each succeeding page of the submission; and

(3) Is encouraged to provide a non-confidential summary of the information or advice.

Pursuant to section 127(e) of the URAA (19 U.S.C. 3537(e)), USTR will maintain a file on this dispute settlement proceeding, accessible to the public, in the USTR Reading Room, which is located at 1724 F Street, NW., Washington, DC 20508. The public file will include non-confidential comments received by USTR from the public with respect to the dispute; if a dispute settlement panel is convened, the U.S. submissions to that panel, the submissions, or non-confidential summaries of submissions to the panel received from other participants in the dispute, as well as the report of the panel; and, if applicable, the report of the Appellate Body. An appointment to review the public file (Docket No. WT/DS-296, Korea DRAMS) may be made by calling the USTR Reading Room at [phone]. The USTR Reading Room is open to the public from 9:30 a.m. to 12 noon and 1 p.m. to 4 p.m., Monday through Friday.

Daniel E. Brinza,

Assistant United States Trade Representative for Monitoring and Enforcement.