dumping of footwear in the United States at less than home-market price. State-controlled enterprises that manufacture footwear in these countries may establish prices for exported footwear which have no relation to cost but simply reflect the country's demand for dollars at that moment. Over the past few years complaints have been filed by the Association on imports of footwear from Czechoslovakia, Poland, and Rumania. In all three cases, Customs found the shoes were being sold at less than fair value, the homemarket price as described in the Antidumping Act of 1921. In the Czechoslovakian case the Tariff Commission found no injury to domestic industry. In the Polish and Rumanian cases the importers assured Customs that there would be no further sales at less than fair value, and the matter was not referred to the Tariff Commission. All of these actions were unsatisfactory. Now it appears that on July 1, 1968 the largely ineffective Antidumping Act of 1921 will be further emasculated by the International Antidumping Code. This Code, negotiated by the Executive Branch despite widespread doubts as to its authority to do so, is in several respects contrary to our own law. For example: (1) The Code requires that evidence of injury be considered both in the decision of whether or not to initiate an investigation and before the imposition of provisional measures. This directly conflicts with the 1954 amendment to the Antidumping Act of 1921, under which the Tariff Commission possesses sole jurisdiction over consideration of injury, which jurisdiction is to be exercised only after the Treasury has withheld appraisement and has made a final determination as to sales at less than fair value. (2) The Code precludes relief unless dumped imports are the principal cause of material injury. The 1921 Act requires only that a domestic industry "injured" by reason of dumped imports. (3) The Code narrowly defines the circumstances under which a regional concept of "industry" may be employed. The 1921 Act contains no such limitations. In view of these conflicts and the lack of authority in the Executive Branch to legislate in the area of foreign trade, we urge the adoption of Senate Concurrent Resolution 38, under which the effective date of the Code would be postponed pending full review and proper implementation by Congress. DEAR MR. VAIL: The International Antidumping Code is scheduled to become effective on July 1, 1968. On behalf of the Tanners' Council of America, the national trade association of the leather industry, may I respectfully request that the Senate Finance Committee take whatever steps may be necessary to postpone the Code's implementation. Significant areas of conflict between the Code and the United States Antidumping Act of 1921 are pointed out in the Tariff Commission's recent report to your committee. Of particular interest is the Commission majority's statement that the regional industry concept under the Code is so narrowly defined that "four out of five determinations by the Tariff Commission might not have been made had the Code been in effect. .." Also of interest are some of the effects of the recent Treasury regulations which implement the Code. Under these regulations the Treasury Department would take back a portion of the injury determination in dumping cases, in spite of the fact that by the Customs Simplification Act of 1954 Congress withdrew the injury function from the Treasury and placed it solely with the Tariff Commission. The regulations would also limit the withholding of appraisement to a period clearly not anticipated by the drafters of the 1921 Act. Senate Concurrent Resolution 38 would prevent implementation of the Code without prior consideration and approval by Congress. We urge the immediate, favorable report of this Resolution. Sincerely, WILLIAM F. MARX. TOM VAIL, [Submitted on behalf of the Bicycle Manufacturers Association] Chief Counsel, Committee on Finance, New Senate Office Building, Washington, D.C. COLLIER, SHANNON & RILL, DEAR MR. VAIL: I submit the following comments on the International Antidumping Code as counsel for the Bicycle Manufacturers Association. BMA is a non-profit trade association having offices at 122 East 42nd Street, New York, New York. Its members account for more than 95 percent of the bicycles produced in the United States. The concern of BMA with U.S. antidumping law and practice is long standing and of great interest to its members. The Association now strongly protests the fact that recent attempts by the Executive Branch to legislate in an area clearly reserved to Congress will be successful if the International Antidumping Code is permitted to go into effect on July 1, 1968. The implementation of this Code without Congressional approval will constitute a dangerous precedent of usurpation of Congressional authority by the Executive Branch. Equally significant, it will weaken the Antidumping Act of 1921 to a degree where dumping relief for domestic industry will be vitrually unobtainable. BMA urges the Committee to thoroughly review the report of the Tariff Commission, which sets out in full all areas of conflict between the Code and the 1921 Act. The Association also recommends the immediate favorable report of Senate Concurrent Resolution 38. Sincerely, THOMAS F. SHANNON. [Submitted on behalf of the Tool and Stainless Steel Industry Committee] COLLIER, SHANNON & RILL, Washington, D.C., June 27, 1968. TOM VAIL, Chief Counsel, Committee on Finance, New Senate Office Building, Washington, D.C. DEAR MR. VAIL: I submit this letter as counsel for the Tool and Stainless Steel Industry Committee, which is an association of seventeen specialty steel producers, all having a particular interest in the area of international trade. This Committee strongly urges that steps be taken to prevent the International Antidumping Code from becoming effective on July 1, 1968. In 1966 the Senate Finance Committee report on Senate Concurrent Resolution 100 stated that dumping "concerns unfair trade practices in a domestic economy and it is difficult for us to understand why Congress should be bypassed at the crucial policymaking stages, and permitted to participate only after policy has been frozen in an international agreement." The Resolution 100 was then overwhelmingly passed by the Senate. Notwithstanding this clear warning the Administration negotiated a Code which in many respects directly conflicts with our domestic dumping law as set forth in the Antidumping Act of 1921. As pointed out by a majority of the Tariff Commission in its recent report to the Senate Finance Committee, the Code (1) contains a more stringent test of inquiry than the Act by requiring that dumped imports be demonstrably the principal cause of material injury; (2) so narrowly defines "industry" as to preclude, in the Commission's words, four out of five of the Commission's existing affirmative determinations, and (3) makes consideration of evidence of injury a condition to the successful filing of a complaint and the withholding of appraisement, notwithstanding the fact that sole jurisdiction over injury consideration was transferred to the Tariff Commission in 1954. Any one of these new proviso's would make domestic industries already difficult task of securing dumping relief a virtual impossibility. For this reason the Committee wholeheartedly endorses Senate Concurrent Resolution 38 introduced by Senator Hartke, and House Concurrent Resolution 447. Sincerely, R. H. S. FRENCH. Hon. RUSSELL B. LONG, AMERICAN IMPORTERS ASSOCIATION, INC., Chairman, Committee on Finance, DEAR SENATOR LONG: In response to the invitation in the press release you issued June 21, we submit for the consideration of your Committee our views on the International Antidumping Code, signed at Geneva on June 30, 1967. We respectfully request that this statement be made a part of the record of the public hearing which your Committee will hold on June 27, 1968. We agree with the Administration, Senator Javits, and authorities in and out of the Government that the United States may implement this code without enabling legislation. As an importers organization, we know at first hand how the provisions of the Antidumping Act are applied in practice. Our long experience in importing and living with the Antidumping Act convinces us that the provision prohibiting foreign sellers from shipping goods to the United States at prices which are lower than the prices charged in the home market, and the provision requiring imposition of a dumping duty when this practice results in an injury to the American industry are sound and adequate. We believe that the Code does not alter, amend, or in any way impair these basic requirements. Neither does the Code make any changes in the duties which the Antidumping Act assigns to the Treasury Department and to the Tariff Commission. Treasury must continue to determine whether or not imported goods are sold to the United States at "less than fair value," and the Tariff Commission will continue to make findings regarding injury. The Bureau of Customs has already promulgated amended regulations under the Antidumping Act which conform with the Code. Here, too, we firmly believe that the amended regulations, which will be applied on and after July 1, 1968, are in accordance with the spirit of the Act. The most important amendments merely accelerate the procedures leading to a Tariff Commission determination as to whether or not there is injury to an American industry requiring imposition of dumping duties. These accelerated procedures will benefit not only importers, but domestic interests complaining of dumping. In addition to being faithful to the basic concepts of the Antidumping Act, the Code will require other countries which accept it to make their antidumping procedures conform with our own United States practices as embodied in the Antidumping Act and the Regulations under it. These are more elaborate and more precise than any others in existence, and, most important, they are published in official documents for all to see and study. This is in contrast to the situation existing in many other countries which have only vestigial or no published statutes or regulations on dumping. This vagueness allows other countries to apply antidumping practices in a capricious and willful manner. Thus, when their interests suit them, such countries can discriminate against American exports by alleging dumping. But when a country accepts the Code, it must follow its provisions, and then American exporters will know where they stand when allegations of dumping are brought against their goods. This will remove another non-tariff barrier against American exports, and finally lead to a harmonization of antidumping laws and procedures to the benefit of all trading nations, large and small. We urge that the Senate Committee on Finance take no action which would jeopardize this very significant achievement in codifying this non-tariff barrier and thus improving the rules of international trade. Sincerely, GERALD O'BRIEN, Executive Vice President. BRIEF OF JAMES R. SHARP, COUNSEL FOR ELOF HANSSON, INC., NEW YORK, N.Y., PAN PACIFIC TRADING CORP., NEW YORK, N.Y., ROBINSON EXPORT-IMPORT CORP., ALEXANDRIA, VA. SUMMARY The International Dumping Code is largely designed to bring the administrative procedures of other counties in line with our own. Those practices provide fair and equitable procedures conforming to our Administrative Procedures Act. The differences between the International Code and our law are advantageous and provide no basis for protracted arguments between the Legislative and Executive branches of the Government. They make sense-they should be approved if that is found necessary or be allowed to be put into effect by the Executive. Rejection of the Code will lead to increased difficulties for our exporters in foreign markets. The bills pending before this Committee would freeze the hands of those charged with administration of the Antidumping laws. The administrator's ability to find equitable solutions would be replaced by rigid rules required to be applied whether or not they made sense. The proposed amendments are not necessary and should be rejected. STATEMENT I am James R. Sharp, attorney for several U.S. companies who for some years past have imported substantial quantities of hardboard. Hardboard is a wood product made of imploded or ground up wood, the fibers of which are thereby torn apart and put back together by wet matting and pressing. Hardboard is used largely in the building and furniture business. The companies I represent here are: Elof Hansson, Inc., New York, N.Y.; Pan Pacific Trading Corp., New York, N.Y. and Robinson Export-Import Corp., of Alexandria, Virginia, one of our local Washington area companies. On behalf of these clients I support the International Dumping Code formulated in the course of the Kennedy Round negotiations and I oppose the bills pending before this Committee which would amend the Antidumping Act of 1921 in a very substantial manner. The principal bills now pending before you are H.R. 8510 introduced by Representative Herlong of Florida, and H.R. 16332 introduced this Session by Representative Saylor of Pennsylvania. I have had considerable experience in respect to dumping matters having acted as counsel for numerous American importers in a broad spectrum of dumping cases over the past 14 years. I have also frequently counseled with American manufacturers with respect to their complaints relative to dumping of foreign products on this market. Dumping is an unfair trade practice. However, the term has been loosely used to apply to all sorts of marketing practices-fair ones as well as unfair ones. The concept of dumping as spelled out in our 1921 Act is the sale of goods produced abroad to U.S. buyers at a lower f.o.b. mill price than the price charged for the same goods on an f.o.b. mill basis for consumption in the producing country involved. There has been a lack of uniformity in the concepts of dumping incorporated into the laws of the major trading nations. The laws of some countries like Canada have provided that a mere difference in price for home country and for export constituted dumping. Under the laws of such nations it makes no difference whether imports injured or threatened injury to their domestic producers of like or similar goods, nor is the extent of competition between the foreign and domestic goods an issue. The laws of other countries, like those of Great Britain for instance, have provided that a dumping order requiring additional duties would be entered only if the sales for export were lower than the sales for domestic consumption in the exporting country, and a domestic industry in the importing country was injured or was likely to be injured by such sales. In the recent Kennedy Round the diversity in the statutes applicable to dumping practices in the major trading nations led to the desirability of negotiating a common code providing uniformity in the rules to be applied in determining when dumping penalties should be applied. Of additional importance was the fact that in the United States we have developed a system of administrative practice before agencies of the Government which provides fair and equitable investigations, open hearings and the adoption of orders under the dumping statute only after all interested parties had been given an adequate hearing on the factual and legal issues involved. In other countries the dumping proceedings have historically been conducted in camera with neither the accused or the accusers being provided the opportunity of hearing the other side of the story or knowing the factors taken into consideration by the administrator of the dumping law in arriving at a proposed decision. In the Kennedy Round, a great concession was obtained by our negotiators, a concession which involved the requirement that other countries conform to our own pattern of administrative procedures. In other words, we obtained a concession which will require all those nations who accept the International Dumping Code before entering a dumping order, to hold an open, fair and square hearing in which all parties concerned may express themselves openly and frankly with the knowledge of their adversaries so that the facts can be clearly laid before the administrators of the law before their decision is made. This concession by other nations is bound to be of great advantage to the United States. In some areas, particularly in the area of agricultural products, we have maintained a two-price policy-selling our agricultural products abroad for less than they would draw in the domestic market. This is dumping under the standards generally accepted by our country and dumping in the concept of that word as used in the laws or regulations of other countries if the sales should result in injury or the likelihood of injury to the country to which the goods are shipped. While I don't know too much about U.S. products as to which dumping proceedings have been instituted by foreign countries, I do know that dumping procedings have been instituted in the United States with respect to a large variety of commodities. They have involved everything from cold rolled sheets of steel to cement, cellophane, bicycles, fertilizer, vital wheat gluten, chronic acid, window glass, titanium dioxide, fig paste, plastic baby carriages, badminton shuttles, 12-ounce canned luncheon meats, halibut steak and a host of other products, including bubble chewing gum. As most of you know, the complaints under the Antidumping Act were few and far between from the period 1930 to 1944. During that period it was practically a dead issue. Since that date as competition between foreign producers and U.S. producers increased, so has the volume of dumping complaints in the U.S. increased. As a result, it became of utmost importance that in the Kennedy Round our negotiators tackle this international problem and arrive, if possible, at an agreed upon code for application of dumping duties-a code which would provide uniform rules for the instigation of dumping orders and, insofar as possible, uniform administrative procedures in line with our domestic procedures. Obviously it is of importance that this country's exporters be treated with the same fairness in dumping proceedings which may occur abroad as we find necessary in dumping proceedings in our own country. Based on our experience in this field I and my clients are satisfied that our negotiators did a good job in the Kennedy Round and therefore we support the International Dumping Code agreed on in that Round. I am quite aware of the fact that it has been charged by a substantial number of members of this Congress and by representatives of a number of industries in the United States that our negotiators agreed to matters which either go beyond, or are contrary to, provisions of our 1921 Antidumping Act. A recent report of the U.S. Tariff Commission rendered March 18, 1968, indicated that three of the five Commissioners agreed with those Congressmen and industries who believed that the Code goes beyond our own statute and is not altogether interpretative but instead requires a change in our law. Without taking a position on whether the majority of the Commission was correct in that conclusion, I can only say to you that it is of the utmost importance to our administrative procedures and to our international relations that this problem be solved by the Congress promptly and definitively. There should be no uncertainty in the effectiveness of our laws or our international agreements. Be it otherwise, our trading partners may well shy away from conformance with the Code. Should this happen, our exporters will be denied the procedural and substantive benefits which will flow from the Code. If this Congress should renounce the Code or prevent the President from putting it in effect, reciprocal action will undoubtedly occur and we will face an international battle which would in the long run affect our exports in a much larger measure than we might anticipate. One of the major points involved is whether an injury investigation should be conducted at the same time as a fair value determination. Prior to 1955, the Treasury Department conducted both of these investigations and it conducted them simultaneously. It was only after adoption of the 1955 amendments to the Act that an initial determination was required by the Treasury Department on the fair value question, followed by a subsequent reference to the Tariff Commission on the question of injury. May I ask what is all the yelling about? Isn't a simultaneous determination not only more efficient but more rapidly determinative of the issues involved, less ruinous if the determination is in the negative, and more beneficial if the determination is in the affirmative. Why should the Congress fight over the question of whether our Executive Department |