Japan is deciding to issue tariffs against Korean DRAM maker Hynix Semiconductor, a new source in Korea said.

The move would make Japan the third foreign government to level tariffs against Hynix, following the United States and the European Union. Reports began surfacing out of Japan on Friday that Japan's finance ministry would begin leveling a tariff of 27.2 percent beginning Jan. 27th against Hynix.

US and the EU issued tariffs of 44 percent and 34.8 percent respectively in 2003. These actions stemmed from U.S. and European claims that the South Korean government efforts to bailout Hynix, which nearly went bankrupt early in 2003, essentially amounted to government subsidies, illegal under WTO rules.

The WTO partially rejected the EU's contention that the Korean government illegally subsidized Hynix. The WTO ruled that the bailout did not constitute illegal subsidies, however it agreed that backing by a Korean state insurance company for Hynix exports and the purchase of Hynix bonds by the government-controlled Korea Development Bank in 2001 were commercially unjustifiable.

By: DocMemory
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