(Bloomberg) — The World Trade Organization on Tuesday ruled for a second time that South Korea’s anti-dumping duties on Japanese valves violate international trade rules, according to a decision published on the WTO website.
The WTO’s appellate body said Tuesday that Seoul must modify its duties on the pneumatic transmission valves, which are used in power tools and diesel engines.
That could increase competition for South Korean manufacturers like TPC Mechatronics Corp. and KCC Co., Ltd. and benefit Japanese producers — including SMC Corp., CKD Corp., and Toyooki Kogyo Co. — which have been subject to anti-dumping duties ranging from 11.6% to 22.7% since 2015.
Dumping occurs when a producer from one country sells a good in another country at a price that is lower than the price of that same product in the exporting country.
The decision from the Geneva-based organization comes amid increased tensions between the two nations whose governments are sparring over reparations stemming from Japan’s 1910-45 occupation of the Korean peninsula.
The appellate body’s finding upheld several key aspects of a 2018 dispute that found South Korea violated WTO rules in the way it determined anti-dumping duties.
Tuesday’s statement also upheld various findings of the 2018 report that disfavored Japan and found in South Korea’s favor with respect to various other aspects in the case, which makes the decision a mixed ruling.
Japanese Trade Minister Hiroshige Seko hailed the ruling as a victory and urged South Korea to “sincerely and promptly correct its measures,” according to a news release.
Seko also said the Japanese government will seek to “invoke countermeasures” against South Korea if it does not promptly comply.
The Japanese Ministry of Economy Trade and Industry said the export value of pneumatic transmission valves from Japan to Korea is approximately 6.4 billion yen ($60 million) per year, according to a news release.
The South Korean mission to the WTO in Geneva did not immediately comment on the decision.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.