August 28, 2018 — Hughes Hubbard earned a significant victory for the Japanese specialty steel industry when the U.S. International Trade Commission (ITC) ended anti-dumping duties on stainless steel bars from Japan.

On Aug. 24, the ITC voted unanimously to remove the duties on steel bars from Japan, as well as Spain and Brazil, finding that lifting the duties would not likely hurt domestic producers in the near future. The ITC, however, voted to maintain the duties for India.

“As a result of the Commission’s negative determinations, the existing antidumping duty orders on imports of this product from Brazil, Japan and Spain will be revoked,” the ITC said in a statement.

The ITC’s decision comes under the five-year sunset review process that is mandated by the Uruguay Round Agreements Act. That federal law requires the U.S. Department of Commerce to revoke an anti-dumping duty order after five years unless the Commerce Department determines that revocation would likely lead to material injury to the U.S. industry. Obtaining victory at just one agency is enough to obtain revocation, as any anti-dumping order must be supported by findings of both dumping and injury.

Stainless steel bars are characterized by resistance to corrosion and heat. They are widely used for a variety of familiar products, including tableware, kitchen tools, construction material, electronic devices, medical appliances and aircraft.

The duties on all four countries have been in place since 1995. Daido Steel Co., Sanyo Special Steel Co. and Aichi Steel Works retained HHR in June 2017 after being subject for more than 20 years to Commerce’s assessment of a 61.47 percent dumping margin for Japanese steel producers – the highest average duty of the four countries.

Winning revocation in these sunset reviews is difficult given the political climate on trade, which favors domestic industry interests. Winning is particularly difficult in steel cases given the political power of the U.S. steel industry. A victory was possible in this case because the U.S. industry had restructured, in part due to foreign investments, while demand for stainless bars increased throughout the world, thereby using up more of the foreign mills’ capacity and making them less of a threat to the U.S. industry.

The ITC began its latest sunset review in July 2017, saying it would probe to see if the foreign companies were still in a position to hurt domestic producers. In October 2017, the agency voted to conduct a full review of the duties, which is often an indication that the Commission is seriously considering whether duties are still necessary.

Matt Nicely, Dean Pinkert and Julia Eppard represented the Japanese steelmakers in this matter.