The U.S. Department of Commerce last week assessed preliminary DRAM dumping duties of 4.96% to 30.89% against the four Taiwanese companies that import the most DRAMs into the United States.
Mosel-Vitelic Inc. was hit hardest, with a 30.89% penalty, while Vanguard International Semiconductor Corp. was assessed preliminary duties of 10.36%, Nanya Technology Corp. 9.03%, and Ertron 4.96%.
The Commerce Department also levied penalty duties of 16.65% against all other DRAM suppliers to the United States, including Japanese and U.S. companies that use Taiwanese foundries. The department said Taiwan's foundries themselves aren't included in the dumping case, only their DRAM customers.
Commerce will make a final decision by the end of September, with likely adjustments or reductions to the preliminary tariffs. Before the dumping duties go into effect, the International Trade Commission must rule that the U.S. DRAM industry has been materially injured.
The dumping charges were filed in October 1998 by Micron Technology Inc., which alleged that Taiwan's chip makers had damaged its business by selling DRAMs in the United States below cost.
The four Taiwanese memory companies vowed they would fight final dumping penalties. "We will never give up the U.S. market," said Charles Kau, executive vice president of Nanya.
Mosel-Vitelic will try to get its penalty reduced or eliminated, said William Chen, executive vice president. Even if hit with final penalty tariffs, Mosel-Vitelic will work with alliance partners to divert DRAM shipments to locations outside the United States, he said.
Taiwan is not a major DRAM exporter to the United States, having only an estimated 7% market share in this country, according to Brian Matas, an analyst with IC Insights Inc., Scottsdale, Ariz.
But Steven R. Appleton, chairman, president, and chief executive of Boise, Idaho-based Micron, said the purpose was not only to punish Taiwanese chip makers for dumping, but to send a clear warning that they shouldn't expand their DRAM capacity further in a glutted global market.
However, the continuing plunge of DRAM prices may be having a more immediate effect on some Taiwan-based producers than the threat of future dumping duties.
Acer Semiconductor Manufacturing Inc., for example, has already decided to slash DRAM production by 75%. "The DRAM business is too risky," said Teddy Lu, executive vice president of ASMI, which lost $150 million last year.
Taiwan filed its own suit against U.S. DRAM makers two months ago, charging those companies had dumped products in Taiwan.
Micron's Appleton called the suit an act of retaliation. "Even if dumping penalties were levied against Micron exports from the U.S.," Appleton said, "we would simply ship to Taiwan from our other plants in Europe, Japan, and Singapore."