Commerce Dept. Rejects U.S. Salmon Farmers' Allegations; No Subsidies Found and "All Others" Rate Reduced in Chilean Salmon Case.

WASHINGTON--(BUSINESS WIRE)--June 2, 1998--The U.S. Department of Commerce today rejected a series of baseless allegations by eight salmon producers from Maine and Washington state against Chilean salmon imports.

After an 11-month investigation, the DOC found that, contrary to domestic producers' claims, the Chilean government does not subsidize the Chilean salmon industry. The DOC also found two of Chile's five largest producers to be fairly trading salmon. Additionally, the DOC reduced the "all others" dumping margin to 5.19 percent -- dramatically below the 42 percent dumping margin sought by domestic producers.

Because the Chilean industry is not subsidized, the DOC imposed no countervailing duties. In the dumping case, the DOC calculated de minimis margins (less than 2 percent, and thus, not subject to duties) for two of Chile's largest salmon producers: Marine Harvest and Camanchaca. Margins for the other two investigated companies, Mares Australes, Aguas Claras and Eicosal, were set at 2.24 percent, 8.27 percent, and 10.91 percent respectively.

The DOC's practice is to average the margins of the companies above the de minimis level and to apply this "all others" rate to the rest of the industry. In this case, the 5.19 percent all others rate will be applied to all uninvestigated Chilean salmon producers. Though the DOC found three companies above de minimis instead of two, as was the case in the preliminary dumping decision, the "all others" average fell from 5.79 percent.

"The results of the DOC's full investigation and the facts presented to the International Trade Commission show clearly that no material injury to the U.S. industry was caused by subsidized or less-than-fair-value salmon imports from Chile," said Richard A. Johnson, lead counsel of the Chilean salmon industry at the law firm of Arnold & Porter. "These low dumping margins and the absence of countervailable subsidies make it difficult for U.S. producers to back their inflated claims for injury."

The ITC will make its final determination in July. A "no injury" determination by the ITC will end the case, and confirm that every major element of the U.S. salmon producers' case has been disproved.

Rodrigo Infante, general manager of the Santiago-based Association of Chilean Salmon Farmers, said that the final DOC decisions "verify what we have been saying all along: Chilean salmon farmers are not -- as the petitioners have alleged -- subsidized by the government. Nor are we, as an industry, 'dumping' our product on the U.S. market. Our producers' success is the result of our country's natural advantages for growing salmon. Our success in the U.S. market is the result of developing, perfecting and marketing a product that consumers want to buy: boneless salmon fillets."

"It is unfortunate that the DOC found any dumping margins," Infante added. "We expect to prevail at the ITC and expect that no margins will ever be established. If, however, there is an antidumping order for some companies, we would find it extremely unjust that the 'all others' rate -- based on three companies rather than all five -- would apply to companies that were never investigated and that are not dumping. They will unfairly be put at a disadvantage just because they are located in Chile."

Infante reiterated that today's ruling will have no effect on the Chilean industry's plans to continue providing American consumers with the products that they demand and continue building a U.S. industry that has created more than 7,600 more American jobs. -0- Note to international editors: The Association of Salmon Farmers will hold a press conference today with Chilean government and industry representatives, including Chile's Minister of the Economy, Alvaro Garcia, and Metro-Dade County Mayor Alex Penelas. Time: 15:30 Place: Club de la Union, Santiago, Chile Contact: Francisco Achondo, Burson Marsteller Chile 011-562-203-5085

    CONTACT: SalmonChile Information Bureau
              Jeanne McKnight, 425/451-3443
              or
              Arnold & Porter
              Richard Johnson/Lawrence A. Schneider, 202/942-5000
              or
              SalmonChile
              Rodrigo Infante V./Francisco Ruiz, 011 [phone]
              or
              Burson-Marsteller Chile
              Claudia Adriasola, 011 [phone]
              www.salmonchile.com