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To: Win Smith who wrote (78558)	9/13/2001 11:04:29 AM
From: froland	Respond to of 93625

Micron to Sue Asian Memory Manufacturers: digitimes.com The Taiwan Semiconductor Industry Association (TSIA) is inviting local DRAM firms to meet on September 13 to discuss the possibility that at the beginning of October Micron Technologies may sue Taiwanese and South Korean DRAM firms for dumping. News about Micron planning to take legal action against Taiwanese and Korean DRAM makers in October appeared in US media at the end of August. The Board of Foreign Trade (BOFT) of the Ministry of Economic Affairs (MOEA) also received urgent notification from the Republic of China’s (ROC) representative office in the US regarding this issue a few days ago. It is widely believed that the anti-dumping lawsuit will be filed. The TSIA indicated that in response to Micron’s possible legal action against DRAM firms in Taiwan, it will unite resources from all of Taiwan’s DRAM firms and come up with preventive measures and countermeasures. In addition, the TSIA will also hold a meeting in conjunction with the BOFT on September 13 to discuss with local DRAM companies the possible impact arising from such lawsuits and what might be the proper action to take. DRAM firms noted that as US laws do not set very high criteria for filing anti-dumping lawsuits and with global DRAM prices mostly lower than manufacturing costs, it is very possible that the US Department of Commerce will review the case after it has been filed. Judging from Micron’s financial results from the previous quarter, it appears to be selling DRAM well below costs. If it accuses Taiwanese and South Korean DRAM makers of dumping, Micron would seem to be acting hypocritically, because this kind of price-cutting is common during downturns in the DRAM industry. Taiwanese DRAM firms generally believe that an anti-dumping lawsuit filed by Micron would bring DRAM prices to the bottom. According to analysts, if the Taiwanese and South Korean DRAM companies were found to be in violation of anti-dumping regulations, the first impact to be seen would be the stabilization of DRAM prices, especially those on US market. Prices could even rise due to the market’s expectation that supply would decrease. This would in turn affect DRAM prices in other global markets. In addition, the lawsuit would also serve to lower willingness on the part of Taiwanese and South Korean DRAM makers to expand capacity. If Micron wins, DRAM products from Taiwan and Korea would all have anti-dumping duties imposed when sold to the US, forcing Taiwanese firms to seriously examine the opportunity cost of further expansion. Past attempts by Micron to file similar lawsuits have failed as the cash-rich Taiwanese firms always succeeded in expanding capacity whenever the market experienced a downturn. According to Taiwanese DRAM companies, an anti-dumping lawsuit may also have a severe impact on Japanese and European DRAM firms’ outsourcing strategies toward Taiwan. If an anti-dumping tax is imposed, prices for their DRAM products made in Taiwan would inevitably rise and consequently lose competitiveness. froland.