TOKYO — Japan notified South Korea on Monday that it wants to start bilateral consultations over its antidumping duties on stainless steel bars from Japan in accordance with World Trade Organization rules.
Currently, South Korea imposes a 15.39 percent tariff on Japanese stainless steel bars. Japan argues that keeping such antidumping duties for roughly 14 years is against international trade rules, taking issue with South Korea’s review process.
Stainless steel bars are used to make bolts, nuts as well as valves for machinery and cars. South Korea mainly imports high-end steel bars from Japan.
If Japan fails to resolve the issue through consultations with South Korea, it can request the WTO to establish a dispute settlement panel, according to government officials.
South Korea began levying antidumping duties on Japanese stainless steel bars in 2004 and the measure has been extended three times so far. The most recent three-year extension from 2017 is estimated to translate to around 1.28 billion yen ($12 million) in tariffs, according to the Ministry of Economy, Trade and Industry.
When a country judges that a product is imported at an unfairly lower price than sold on its home market, it can impose an antidumping tariff. Such an antidumping measure should expire after five years but can be extended “as an exception” if lifting it is feared to hurt the domestic industry.
Japan exported around 9,269 tons of stainless steel bars to South Korea in 2002 before the levy was imposed, but it fell to 5,349 tons in 2016.
The share of Japanese stainless steel bars in South Korea’s total imports also decreased from 50.9 percent to 12.9 percent, the ministry said.
The Japanese government took a tough stance on South Korea amid a growing trend for protracted use of antidumping duties among members in the Association of Southeast Asian Nations.