Friday, March 28, 2003
The United States is likely to slap punitive import duties on chip shipments of South Korea's Hynix Semiconductor Inc next week, dealing a fresh blow to the firm already reeling from financial difficulties, industry sources said.
The U.S. Department of Commerce is set to unveil preliminary ruling on Monday over allegations lodged by Micron Technology Inc MU.N that the U.S. chip maker was materially injured by imports from South Korean chip makers that received illegal state aid.
The proposed duties will be crippling to Hynix 00660.KS that posted huge consecutive losses in the past three years, as it will force Hynix to deposit the duties to the U.S. Department of Commerce until final rulings are made on June 14.
"The decision will be a huge setback for Hynix," said An Seong-ho, a Meritz Securities analyst, adding Hynix may have to pay $14 million to the U.S. regulator per month, should they decide to impose import duties of 30 percent.
The European Union is expected to take similar preliminary steps on April 24 after sources said last week it may impose up to 35 percent duties on shipments of Hynix chips after Germany's Infineon Technologies AG IFXGn.DE filed complaint in June.
If slapped with penalty duties, Hynix may have to seek other ways to minimize the impact by channeling chips more on the Asian spot market and boosting productions at its overseas plant to avoid tariffs, analysts said.
By: DocMemory
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