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Technology Stocks : Micron Only Forum -- Ignore unavailable to you. Want to Upgrade?

To: SeaViewer who wrote (40306)	10/23/1998 6:37:00 PM
From: sandstuff	Respond to of 53903

Micron's suit against Taiwan is far-reaching By Jack Robertson WASHINGTON -- Micron Technology Inc. has filed its long-expected DRAM dumping petition with the U.S. government, casting a wide net over Taiwan's DRAM manufacturing machine. The petition, filed with the U.S. Department of Commerce and the International Trade Commission, names virtually every Taiwanese foundry that makes DRAMs for export (see Oct. 22 story). The suit could also affect foundry users, particularly Japanese DRAM suppliers, which depend heavily on the island's manufacturers for their chips. In its charges, Micron said Taiwan's chip makers have damaged its business by selling DRAMs in the United States below cost. The Boise, Idaho, company cited specific dumping incidents involving Nan Ya Technology Corp., which allegedly sold DRAMs at 73% below production cost, and Vanguard International Semiconductor Corp., which is said to have sold chips at 52% below cost. An ITC hearing is set for Nov. 12. Also named in the petition were Acer Semiconductor Manufacturing, Mosel-Vitelic, Powerchip Semiconductor, United Microelectronics, and Winbond Electronics, Macronix International. In addition, U.S.-based Alliance Semiconductor Corp. and the U.S. arm of Taiwan Semiconductor Manufacturing Co. also were cited for importing DRAMs from Taiwan. The island's DRAM vendors said they anticipated Micron's charges and are ready to defend themselves. "The dumping [suit] is the American DRAM maker's strategy in competition," said Peter Pan, general counsel for Hsinchu-based Vanguard. "Taiwan is neither a pricing leader nor the most influential [player] in the memory market. We are gathering data and working with the Taiwan Semiconductor Industry Association now to plan our strategy. "One thing for sure," Pan added. "We will not withdraw from the U.S. market, even if we have to pay a deposit." Observers said Micron may have filed the petition in an effort to head off rampant Taiwanese capacity expansion. Taiwan has only a 3.8% share of the global DRAM market, according to Semico Research Corp., of Phoenix, but chip makers there have been gearing up for major growth. Micron claimed that Taiwan's DRAM imports jumped from 6% in 1997 to 10% in the first half of 1998. DRAM vendors in Japan and Korea have also expressed concern that a capacity build-up by Taiwan could unleash a wave of chips, just as the market shows signs of stabilizing (see Oct. 21 story). The charges outlined in the petition relate to all discrete DRAMs and DRAM wafers, whether made for the merchant market or as part of a contractual arrangement. DRAM chips made in Taiwan but sold in module form were included in the suit. In addition to Taiwan-based vendors, the Micron petition could affect foundry users, particularly Japanese DRAM suppliers Fujitsu, Mitsubishi Electric, and Toshiba, which outsource up to 50% of their DRAM production to Taiwanese partners. The charges could also affect German DRAM supplier Siemens AG, which has a joint-venture DRAM fab--ProMos Technologies Inc.--with Mosel-Vitelic in Taiwan. The petition's broader implications appear to have legal precedent. In April, the ITC assessed duties against several U.S.-based fabless SRAM companies because they were using Taiwanese foundries that were found to have dumped chips in the United States. Micron said it hasn't yet decided whether to file against Japan's DRAM producers directly. Two South Korean companies, Hyundai Electronics Industries Co. Ltd. and LG Semicon Co. Ltd., have already been assessed DRAM-dumping penalties in a six-year-old case. With a year to gird for battle, however, Taiwan's chip makers said they have their legal strategy well prepared. "This is a war that we must fight," said Yin-Sheng Tung, assistant vice president of Hsinchu-based Powerchip, a DRAM foundry venture with Mitsubishi. "Data from our R&D, manufacturing, and marketing can clearly show the answer is, 'No, we did not conduct dumping.' I am confident in the judicial system in the States. We should be able to win the case." --Additional reporting by Sandy Chen.