Commerce Dept. Finds Misconduct by Japanese Press Maker TKS

By: Jim Rosenberg The U.S. Department of Commerce said yesterday that evidence Japanese press maker Tokyo Kikai Seisakusho withheld and misrepresented information during a years-long government antidumping investigation was sufficient for the department to now apply an adverse-facts-available margin of 59.67% for its review of the year 1997-98, rescind revocation of the antidumping duty order for TKS for the year before the entire order was terminated, and reconsider the sunset review that led to revocation of the entire order.

The last measure could reinstate the antidumping duty order for large newspaper presses from Japan, regardless of manufacturer. The Commerce Department said it will reconsider a sunset review approximately a month after next week's publication of the final results of its just-concluded changed-circumstances review.

Based on evidence developed in the course of the antidumping lawsuit that Goss International won in late 2003, the department self-initiated a changed-circumstances review of its Sept. 2000 revocation of an antidumping duty order against TKS. The revocation followed reviews of three consecutive years -- necessary to satisfy the department that TKS was no longer engaging in unfair pricing.

The Commerce Department's changed-circumstances review was based largely on business conducted between TKS and The Dallas Morning News. Although the near-60% applied margin is for 1997-98 and has no effect on current press imports from Japan, by replacing the original review's zero margin, it denies TKS the three consecutive zero-margin reviews needed to lift the antidumping duty order.

Last Sunday, Foster's Daily Democrat reported that Goss CEO Bob Brown was unhappy that the Commerce Department was re-examining only the 1997-98 administrative review. "They're citing only one, and frankly, it's the smallest transaction of all," Brown told the paper in Dover, New Hampshire, site of a Goss facility.

Yesterday's decision did find "deliberate" and "egregrious misconduct" by TKS during the antidumping administrative proceedings in the 1990s. And it affirmed last summer's preliminary findings that TKS submitted false and incomplete information for its only sale during the 1997-98 period under review. But for the 1998-99 and 1999-2000 administrative reviews, the Commerce Department stated that it found "no basis to conclude that TKS intentionally provided misinformation ... at a level which warrants the recalculation of margins."

In a statement issued soon after the decision, Brown said: "TKS knowingly broke U.S. laws and then committed blatant acts of fraud against the U.S. government in an attempt to avoid penalties."

TKS (U.S.A.) President Greg Harabin was away from the office Friday, but Peter Toren, his company's New York-based attorney at Sidley Austin Brown & Wood, told E&P that the decision will have "little or no impact on prospective or current customers," that it "doesn't require TKS to pay a cash deposit, now or in the foreseeable future," and that any sunset review "could take up to a year."

In the meantime, TKS has recourse to the U.S. Court of International Trade. Though that court last fall dismissed TKS's original allegations challenging the Commerce Department's re-examination of TKS behavior during past periods of review, Toren said, "we still have the right to [challenge] Commerce's authority to render a decision in this matter."

Mitsubishi Heavy Industries -- whose sale of presses to The Washington Post 11 years ago sparked Goss' original petitions for antidumping investigations of two German and two Japanese competitors -- expressed concern last year that an adverse determination with respect to TKS could also unfairly affect Mitsubishi's business in this country. It did not respond to an E&P inquiry.

Though Mitsubishi effectively abandoned sales efforts in the U.S. newspaper market for years after the Washington Post press purchase, it has returned to the Nexpo trade show in recent years. One year ago sold a six-tower press to a division of the Washington Post Co.