South Korea decries U.S. washing machine probe

Reuters News
Posted: Jan 21, 2012 1:28 AM

SEOUL (Reuters) - South Korea objected strongly on Saturday to a planned U.S. investigation into imports of Korean washing machines which could trigger huge import duties, saying the action was unfair.

The U.S. Commerce Department said on Friday it was launching the probe, requested by Whirlpool Corp., that could lead to import duties on more than $1 billion of washing machines from South Korea and Mexico.

The action comes despite the two countries signing a free trade agreement last year.

The century-old American manufacturer alleges South Korean producers are selling residential washing machines in the United States at prices 31 percent to 82 percent below fair market value, the Commerce Department said.

It also accuses Mexican suppliers of undercutting U.S. prices by 27 percent to 72 percent.

South Korea's Ministry of Foreign Affairs and Trade said it had "raised strong objections to the unfairness" of the probes, via a letter addressed to the Commerce Secretary and a series of high-level official talks.

"In addition, (the ministry) will call on the U.S. side to proceed with fair and objective probes," the statement said.

In October, the U.S. Commerce Department set preliminary anti-dumping duties ranging up to 37 percent on imports of bottom-mount refrigerators from South Korea and Mexico, which totaled more than $3 billion in 2010.

U.S. imports of residential washers from South Korea and Mexico were valued at an estimated $659.1 million and $450.2 million, respectively, the department said.

"Whirlpool is taking this legal action to protect its 23,000 U.S. employees and the communities in which they work from practices used by Samsung and LG that violate U.S. and international trade laws," the company said in a statement.

Whirlpool's refrigerator case was also directed at Samsung and LG, which have both said they were confident the United States would find them in compliance with U.S. trade laws once it completes its investigation.

A separate government agency, the U.S. International Trade Commission, must give its approval for the washing machine case to proceed. The panel is expected to vote by February 13.

(Reporting by Sung-won Shim; Writing by Nick Macfie)