|
Deficiencies in the Current Administration of the Product Exclusions Process
The Steel Section 201 product exclusion process is a critical element
of the President's comprehensive steel plan, in that it will help
to minimize unnecessary harm to steel consuming industries. However,
we have identified a number of procedural problems with the current
product exclusion process, discussed below, that should be corrected
to assure fair administration of product exclusions.
1. TONNAGE LIMITATIONS ON EXCLUSIONS ARE UNFAIR
A significant number of the exclusions that have been granted
have been conditioned on tonnage limitations.
- Because the Administration actively discouraged companies from
filing duplicative exclusion requests, there is no reason to believe
that tonnage limitations based on amounts in submitted exclusion
requests are sufficient to address shortages or unavailability
of steel.
- We are not aware of any way to allocate this tonnage fairly
or rationally. A "race to the Customs House" should
be avoided if possible.
2. THE ADMINISTRATION SHOULD NOT ALLOW THE DOMESTIC STEEL
INDUSTRY TO FAIL TO ANSWER IMPORTANT PORTIONS OF THE OBJECTORS'
QUESTIONNAIRE OR IMPROPERLY TO REDACT KEY PORTIONS OF THEIR RESPONSES
The product exclusion process requires strict adherence to all
requirements equally for requestors and objectors. We are concerned
that even-handed treatment of requests for exclusion and objections
could be lacking.
- Companies seeking product exclusions have been informed that
their requests would be rejected if they either fail to respond
fully to every question raised, or seek to have significant portions
of their request treated as business proprietary information.
The Administration should assure that objectors' questionnaires
are being treated in the same manner. To date, it appears that
many of the objections that have been filed do not respond to
key questions raised by the administering agencies.
- Many of these objections improperly claim proprietary treatment
for key portions of their response. While requestors or objectors
could properly delete customer names, other information (including
aggregate quantities) should not be considered proprietary. It
is necessary for all parties to know the significant parameters
of the requests and the objections. The administering agencies
should not consider objections that do not meet the rules applied
to requestors' questionnaires.
- Improper claims for proprietary treatment (and the consequent
redaction of such information) effectively precludes public scrutiny
of these objections or any ability on the part of the product
exclusion requestors to respond to the objections raised.
3. THERE IS A FAILURE TO GIVE AN OPPORTUNITY FOR REBUTTAL
TO OBJECTIONS RAISED
- The Administration has indicated it will reject unsolicited
submissions by product exclusion requestors to rebut objections
that have been filed to their product exclusion requests. We believe
this is clearly unfair to requestors, even if unsolicited submissions
by objectors are treated similarly.
- Even if the Commerce Department does solicit a response in
a particular instance, the domestic steel producers' unwarranted
claims for proprietary treatment of their objections (see above)
may make it extremely difficult for product exclusion requestors
to fully address any objections that have been raised. We repeat
that information other than customer names and customer-specific
quantity information should be given to requestors to allow for
full airing of disputed issues.
4. PRODUCT EXCLUSIONS MUST BE GRANTED ON AN ON-GOING BASIS
AFTER JULY 3, 2002
- The President's March Proclamation does not appear to specifically
authorize granting product exclusions after July 3, 2002, but
before March 2003. This deficiency must be remedied.
- Some companies will run out of steel in July 2002, and these
companies cannot wait until the government is authorized to grant
additional product exclusions in March 2003.
5. EXCLUSIONS SHOULD BE CONSIDERED EVEN IF THE NECESSARY
STEEL IS FROM COUNTRIES OTHER THAN THE EUROPEAN UNION OR JAPAN
- All product exclusion requests that are meritorious should
be granted, whether or not the steel needed comes from Europe
or Japan. Exclusion requests should not be judged on the country
of export of the needed steel.
6. THERE MUST BE MEANINGFUL CONSIDERATION OF SHORT SUPPLY
SITUATIONS
- United States steel producers at full production supply only
about 80 percent of the total amount of steel needed by American
manufacturers of products containing steel, such as automobiles
and parts, appliances, heavy machinery, fabricated metal products,
and farm equipment. Failure to permit imports of steel, even steel
of a type that is made domestically, could unduly burden steel
consuming industries.
- Without imports, the supply of steel that is needed in this
country is insufficient. The Administration needs to recognize
this and be willing to grant product exclusions based on short
supply situations.
- We see four situations where product exclusions are warranted:
- A needed steel product specification is not made in the
United States;
- A needed steel product is not available in sufficient quantities
to meet U.S. demand;
- A needed steel product must be sourced from a qualified
foreign supplier; and
- A needed steel product is so expensive that the purchaser
will lose business and jobs to offshore competition if the
request is not approved.
|
