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Tuesday, 02 September 2008 12:11

Chip war between South Korea and Japan heats up

Written by Nick Farell

Image

Tariffs too slow to come off


South Korea
has ordered Japan to scrap punitive tariffs on RAM made by Hynix Semiconductor.

Japan said that it would reduce the 27.2 per cent tariff it imposed on Hynix DRAM chips in 2006 to 9.1 per cent, after the World Trade Organisation ordered the duty be recalculated by September 1. However Hynix said the Japanese decision called for the lower tariff to remain in place until the end of 2010. 

Jim Wan-joong, director of the East Asian Trade Division at the Ministry of Foreign Affairs and Trade, said Tokyo's decision was "unacceptable and unfair" and South Korea was looking at retaliatory measures against Japan. The Koreans are also expected to ask the WTO to look into the matter again.

The United States, the EU and Japan have imposed duties on Hynix DRAM chips because of what they called unfair South Korean government support for the company when it nearly collapsed twice under debt in 2001 and 2002. South Korea almost won the battle, the WTO upheld Washington's 44.71 per cent tariff, but called for the EU and Japan to recalculate theirs.

The EU said in April it was repealing duties of more than 30 per cent effective as of the end of last year.

Nick Farell

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