Taiwan tire makers propose settlement of import duties case

Taiwan's four largest tire makers have banded together to propose a settlement with the U.S. government for the suspension of the Commerce Department's antidumping investigation into imports from Taiwan in exchange for pricing oversight on shipments into the U.S.

The four companies — Cheng Shin Rubber Ind. Co. Ltd. (Maxxis), Federal Corp., Kenda Rubber Industrial Co. Ltd. and Nankang Rubber Tire Corp. Ltd. — submitted their proposal Jan. 13 to the U.S. Department of Commerce. The proposal is signed by U.S.-based counsel for all four companies.

The proposal comes after the Department of Commerce ruled in late Decemberthat passenger and light truck tires imported from South Korea, Taiwan, Thailand and Vietnam should be subject to anti-dumping duties ranging up to 98.44% depending on the country of origin.In Taiwan's case, the duties are: Cheng Shin Rubber — 52.42%; Nankang Rubber Tire — 98.44%; and all others — 88.82%The tire makers' proposal, which is based on their assertion that collectively they represent up to 85% of the targeted imports from Taiwan, asks Commerce to suspend its antidumping investigation initiated on June 29, 2020, with respect to passenger and light truck tires from Taiwan.

In return, the four companies would agree to "not sell subject merchandise in the United States, on and after the effective date of the agreement, at prices that are less than the reference prices established under this investigation."

Commerce would determine the reference prices (RPs) on a quarterly basis based on the "constructed value" of the subject merchandise, in accordance with specific language in the Tariff Act of 1930, the law that governs most import duty regulations.

The proposal contains lengthy explanations of how the RPs would be calculated.

In the proposal, the four tire companies cite Commerce Department assertions that suspending the investigation "will be more beneficial to the domestic industry than the continuation of the investigation" because of its complexity and "extraordinary circumstances."

The proposal goes on to state that Commerce "has determined that the suspension of the investigation is in the public interest and that effective monitoring of the agreement by the United States is practicable."

This determination, the Taiwanese companies assert, takes into account "the availability of supplies of the merchandise, the relative impact on the international economic interests of the United States, and the relative impact on the competitiveness of the domestic industry producing the like merchandise, including any such impact on employment and investment in that industry."

It is understood that a proposal such as this would be subject to comment from all interested parties, including the original petitioner, the United Steelworkers. Tire Business reached out to the USW for its reaction, but hasn't as yet received a reply.

Taiwan's imports of passenger/light truck tires into the U.S. amounted to between 8 million and 9 million units in 2017-2019, and was valued at roughly $375 million. It's the smallest of the four nations/territories targeted by the USW petition.