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USW, Four American Paper Producers Win Illegal Trade Practices Case

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This week’s unanimous affirmative vote by the U.S. International Trade Commission (ITC) on the petitions brought at both the ITC and the U.S. Department of Commerce (Commerce) on Jan. 21, 2015, by the United Steelworkers (USW) and four U.S. paper manufacturers brings much needed relief to the industry. The four manufacturers are Packaging Corp. of America (PCA), Domtar Corp., Finch Paper LLC, and P.H. Glatfelter Co.

The ITC found that dumped, unfairly priced imports of certain types of uncoated paper in sheets from China, Indonesia, Brazil, Portugal, and Australia are causing material injury. They also found that during that same time, illegally subsidized imports from China and Indonesia were also causing material injury. 

During the period of these investigations, eight U.S. mills that produce uncoated paper were forced to close. They had been faced with a dramatic increase in unfairly traded imports, which resulted in the loss of thousands of paper jobs. Unfairly priced imports from the five countries named in the petitions were decimating U.S. producers and workers. The effort to stop the dumping and subsidies was supported by dozens of congressional and state officials from both parties.
 
Dumping occurs when a product is sold in the U.S. at a price below what it costs to produce or what it is sold for in the home country. Countervailing duties are imposed on imports that are subsidized by foreign governments. 
 
Last month, Commerce determined dumping margins ranging up to 222.46% against the five countries and subsidy rates of up to 176.75% against China and Indonesia.
 
The petitions had asked the ITC and Commerce, the agencies responsible for investigating illegal trade practices, to impose duties to offset the dumping from all five countries and to offset the subsidies on imports from China and Indonesia. The duties identified by Commerce will be applied as of the date the antidumping and countervailing duty orders are published in the Federal Register.

The petitions covered all uncoated paper in sheets (including cut-size and folio), weighing between 40 and 150 gsm, and having a GE brightness level of 85 or higher, typically used in copy machines and sheet-fed printers.
 
"Predatory trade practices by China and other countries have targeted the U.S. paper sector," said USW International VP Jon Geenen. "The results have been devastating for our members and their families and communities. America's paper sector is competitive when the rules are fair and when they're enforced. Today's decision will help stabilize and, hopefully, regain production."
   
Mark Kowlzan, CEO of Packaging Corp. of America, said that "today's decision will help restore fair market conditions for this product. From day one we knew that the law was on our side, that the facts were clear and that our petitions were necessary to restore fair competition. We only wanted for international trade rules to be enforced. We make great products and deserve the right to compete. That's exactly what this case will do."

John D. Williams, president and CEO of Domtar, noted that "this decision shows that our continuing investments in our plants and our people have put us on the right course. With the fair market conditions in uncoated paper that result from this case, we will be able to continue to compete and provide our customers with high quality products. We're pleased that the law worked as it was designed and we can focus our attention on the future." 
 
USW International President Leo W. Gerard added that "trade cases are all too often a necessary tool to ensure fair competition. Our members should not have to face unfair and predatory trade practices. Their government should be initiating action, but if they do not, we must.
 
"In partnership with the four petitioning companies and supported by dozens of elected officials from across the country," Gerard continued, "we made clear that we would not cede our market to unfair competition. The paper sector supports thousands of good, family-supportive jobs all across the country, and we owe it to the workers to ensure that when they work hard and play by the rules, they'll have a good shot at a at a decent life."
 

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