The tariff was imposed by the EU as a balancing measure, because
of subsidies allegedly made to Hynix by state-owned or controlled
banks.
The chips affected are Dynamic Random Access Memory, or DRAM,
chips, the most common type of RAM for personal computers.
Germany's Infineon Technologies AG, a rival manufacturer of DRAM
chips, complained to the EU about Korean subsidies last year. The
ensuing investigation lasted over a year and focused on two
companies.
The first, Samsung Electronics, was found to have received
subsidies to a value marginally beneath the level at which duties
can be imposed, and no action was taken against it.
But the second company, Hynix, was found to have benefited from
two types of subsidy, in the form of a refinancing programme with
the Korean Development Bank and further financing from a group of
different banks. Both measures were apparently carried out under
the influence of the Korean government.
In April this year the Commission imposed a provisional tariff
of 33% on Hynix, to last for four months. Earlier this month the
Commission decided that the tariff should be increased to 34.8%,
and should last for five years.
According to Associated Press, the South Korean government has
now filed a complaint with the WTO over the tariff. The government
argues that the funds given to Hynix were not state sponsored, and
that some of the creditors involved are not even South Korean.
The EU tariff followed a similar move by the US Commerce
Department, which imposed a tariff of 44.71% on the import of Hynix
goods. According to Associated Press, South Korea is also intending
to file a complaint with the WTO over this US tariff.
