EU favours scrapping memory chip duties

Date: 03/07/1997

THE European Commission has revealed its hand as a controversial decision looms over whether to continue safeguarding European producers of a key component of telecoms and computer equipment with anti-dumping duties - even though no official position has yet been taken.

Trade officials disclosed their opposition to continued anti-dumping measures against D-RAMS (dynamic access random memory) chips - a component of all semiconductors - at a meeting of national experts last week, according to a member state official following the dossier.

“The paper said the intention was to terminate duties. But discussions with the industry are still continuing,” he said. “The Commission hinted at its position although it has still not officially made up its mind.”

One scenario being looked at, he added, was for the EU to keep tabs on the quantity and price of D-RAMS being imported into the Union through some sort of surveillance regime similar to that already hammered out between the US and Japan.

Commission officials said the issue was raised last week with national governments, but stressed that they had yet to arrive at a final position for or against duties.

The issue of whether on not to protect European producers of D-RAMS or allow the many manufacturers using them to buy at the cheapest world market prices is one of the biggest anti-dumping dossiers currently in front of the Commission.

Telecoms equipment manufacturers, such as Sweden's Ericsson and Finland's Nokia, have been lobbying heavily for no duties to be imposed.

However, the handful of European chip producers, headed by Germany's Siemens, Philips, IBM and Texas Instruments, are calling for continued levies to protect them against cut-price imports from Japan and South Korea.

“There are rumours that the Commission does not want to continue duties, but nothing has been decided,” said a spokesman for Siemens.

Part of the argument over the desirability of duties centres on whether D-RAMS are still a strategic resource for the EU or, as the Nordics argue, an ordinary commodity and building block for information technology industries. They claim that European industry has far more to gain from access to cheap chips than from protecting the small number of local producers.

The question of duties on D-RAMS has surfaced in the wake of a dramatic slump in prices following the boom period in the early 1990s, as manufacturers rushed to satisfy the expanding demand for personal computers.