Fuyao wins anti-dumping battle in US
By Dai Yan (China Daily)
Updated: 2004-05-12 08:50

China's largest auto glass maker Fuyao Glass Industry Group Co Ltd said yesterday it won a close-to-zero rate in a preliminary anti-dumping ruling by the United States Department of Commerce (DOC).

The DOC said in its new ruling that the dumping rate for Fuyao is 0.13 per cent. It ruled in February last year in favour of imposing anti-dumping duties of 11.8 per cent on Fuyao's shipments of automotive replacement windshields to the US.

The DOC was asked by the US Court of International Trade in New York last December to remand the case for a new ruling.

The impact of the 0.13-per-cent rate can be ignored, say trade experts.

No cash deposit will be required of the company if the rate is less than 0.5 per cent.

The final ruling is expected in September and no major changes are expected.

Su Qing, an analyst from Merchant Securities, said the ruling will greatly increase Fuyao's overseas business.

"The ruling will cut Fuyao's export cost and will be a big advantage for it compared to its domestic counterparts," Su said.

Other domestic companies involved in the case had anti-dumping duties higher than the 3 per cent imposed.

Fuyao, listed on the Shanghai Stock Exchange, was a blue-chip company, Su said.

Fuyao President Cao Dewang said the case did not have an effect on his company's operations.

"Because of the case, many auto makers placed orders with us directly, rather than with the auto parts makers only," he said.

The company reported revenues of 433 million yuan (US$52.3 million) in the first quarter, rising 48.6 per cent year-on-year. Its net profit surged by 48 per cent to 76.8 million yuan (US$9.28 million).

The company recorded a 54-per-cent surge in its revenue of 1.73 billion yuan (US$209 million) last year. Its net profit even jumped by 74 per cent to 321 million yuan (US$38.78 million) last year.

Besides the ruling, Su said the government's decision to speed up efforts to boost automobile and components exports would create a favorable climate for Fuyao's business growth.

The government has set a target for the nation's automobile and components exports to reach US$15-20 billion next year. And a long-term goal is US$70 billion to US$100 billion a year by 2010.

Legal analysts say they believe the case is important for other Chinese companies suffering from frequent US protectionist action.

A lawyer from the Beijing Junhe Law Firm said the win by Fuyao could create a good legal precedent for Chinese companies.

"Points in the Fuyao case will be quoted by many Chinese companies as positive proof when they are facing anti-dumping charges," he said.

Fuyao also pioneered a model for Chinese companies showing how to deal with increasing trade disputes, he said.

Fuyao Group and its US subsidiary, Greenville Glass Industries Inc, appealed April 10 last year to the US Court of International Trade in New York. The federal district court specializes in appeals against DOC anti-dumping decisions.

"We believed that right was on our side, so we spent a lot of money to prove it," Cao said.

Fuyao Group spent US$3 million presenting its case.

Fuyao also won an anti-dumping case in Canadian September last year.

The Canadian International Trade Tribunal's final determination said that the Fuyao Glass Industry Group Co Ltd has caused no injury to the Canadian industry.

The decision meant a previously imposed, weighted average tariff rate of 24.09 per cent placed on it by the Canada Customs and Revenue Agency, would have no effect.

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