S.323, which calls for a maximum of 6 months from the filing of a complaint to a notice of withholding of appraisement.

Further, in connection with the Antidumping Act of 1921, we believe it would be highly desirable to codify some of the Tariff Commission's more recent and realistic interpretations of the statute's injury requirements.

Specifically, we believe the law should require the Commission to make an affirmative determination of injury when less than fair value sales of foreign merchandise have caused or are likely to cause more than immaterial injury in any line of commerce in any section of the country. S.323 would so provide.

Finally, we believe that judicial review of determinations by both the Treasury and the Tariff Commission should be explicitly authorized on petition of domestic as well as foreign industries, as provided in S.323. The right of review for domestic injury is subject to serious doubt. We urge the Committee to clarify the Act to remove any doubt of the right of judicial review for all parties to an antidumping proceeding.

We generally support the trade reform bill's countervailing duty amendments. Here also we believe that judicial review should be provided upon petition of any interested party, as provided in S.323.

We support the trade reform bills provisions to liberalize the escape clause. However, we question the desirability of conferring upon the President total discretion to decline to act upon a recommendation for relief by the Tariff Commission. Under S.323, a procedure is provided by which the Congress can in appropriate circumstances override a Presidential determination not to follow a Tariff Commission determination.

We also support S.323's amendments to the Revenue Act of 1916. If a domestic manufacturer unjustifiably sells his product at one price in New York and at another in Chicago and thereby causes injury to competition, he can be held liable for treble damages. But if a foreign manufacturer illegally dumps merchandise in the United States, takes away business by unfair pricing, drives American men and women out of work and damages the industry-even if all this can be proved he is not required to make any compensations. He does not even have his wrist slapped. Meanwhile, he has prospered while our people are out of work. We think such a foreign manufacturer should be subject to the same kind of obligation to redress the injury he has caused that domestic manufacturers face.

Specifically, we think that the Revenue Act of 1916 should be amended to make it a more realistic vehicle for the recovery of treble damages for injurious international price discrimination. The act currently makes it possible for an injured U.S. businessman to secure damages only where he can show that dumping was committed "with the intent of destroying or injuring an industry in the United States" -that takes a little mind reading to discover a man's intent. S.323 would eliminate this onerous intent requirement and permit recovery where the effect of a known price discrimination was to injure competition. That is the same standard that exists in domestic price discrimination cases.

Despite the Antidumping Act, there is today little incentive for foreign manufacturers to avoid dumping in the United States when it suits their own interests. Indeed, it is frequently very much to their advantage to dump. Dumping gives them an opportunity to invade our domestic market. Why not dump? They are not held accountable for the damage that they cause. So we especially urge you to consider title IV of S.323 which will provide at least the possibility of treble damage suits for dumping.

In concluding, I would like to convey to the committee our members' views on title IV of the trade reform bill.

We strongly urge that the committee report to the Senate a trade bill that confines itself to trade issues. We are convinced that in the long run, the cause of world prosperity, stability and understanding is served by promoting free, fair and nondiscriminatory international trade.

We types of industry and our workers need the trade reform bill now, this year. We want to add jobs by selling more of our products

overseas.

Thank you.

Senator TALMADGE. Thank you, Mr. Rhodes, for your contribution. You have made an excellent statement. The recommendations seem to me to be both reasonable and necessary.

Mr. RHODES. We hope so.

Senator TALMADGE. Thank you very much.

The committee will stand in recess until 10:00 a.m. tomorrow morning.

[The prepared statement of Mr. Rhodes follows:]

PREPARED STATEMENT OF EDWARD M. RHODES, PRESIDENT, AMERICAN

CHAIN ASSOCIATION

My name is Edward M. Rhodes. I am President of the American Chain Association, a voluntary, non-profit trade association, comprised of United States companies engaged in the design, manufacture and sale of sprocket chains for the mechanical transmission of power and for conveying and elevating. The eleven member companies, listed in Appendix A, account for substantially all of the domestic production of sprocket chain. The ACA speaks on behalf of its members on matters of general concern to the sprocket chain industry.

Our Association is not concerned with anchor chain or tire chains. Our chains run over sprockets, and they transmit power from one shaft to other shafts or they convey or elevate material of one kind or another.

We can be classified as a medium sized industry. Our total shipments last year were $240 million. Our problems, we believe, are typical of those of scores of other medium sized industries.

It is no secret that many industries of our size have encountered and, despite devaluation, will continue to encounter, serious troubles and disruptions caused by imports. We are not, however, urging a return to protectionist legislation-for example, legislation that would impose import quotas or increase tariffs, or prevent the further reduction of tariffs in accordance with international agreements.

What we are asking for is legislation that will help insure fair international trade.

In general our Association supports the provisions of the Trade Reform bill, but we urge that certain portions be strengthened along the lines of S. 323, introduced by Senator Schweiker.

Four years ago, of the total pounds of roller chain used in the United States, imported chain accounted for 25 percent. We were concerned about fur

30-229 - 74 pt. 4 -- 33

ther growth of imports. In 1972, imported roller chain amounted to 35 percent of the pounds of roller chain used in the United States. And, last year, 1973, it was still at that level.

In March 1971, we began a thorough investigation of Japanese pricing of roller chain in the United States and in Japan. A year ago, in March 1973, the 1921 as a result of unfair pricing on the part of Japanese roller chain manufacturers. Because of this first-hand experience with the Antidumping Act we think we are in a position to make some suggestions on how this 50-year old legislation can be improved.

We are particularly concerned about the length of time required for a dumping case. In February 1970, we began our studies. The formal findings of both Treasury and the Tariff Commission were published in April 1973. Where did all this time go? As indicated in Appendix B, it took us a yearfrom February 1970 to March 1971-to gather the pricing information necessary to confirm our suspicions of dumping and to satisfy ourselves that we would be able to demonstrate the necessary causal connection between that dumping and the injury our industry was experiencing.

In March of 1971 we initiated the necessary investigation to document the actual price levels of Japanese chains in Japan and the United States. This project was finished in October. We assembled the data and filed a formal complaint with Treasury on December 20, 1971.

On November 30, 1972, Treasury issued a determination of dumping and notified the Tariff Commission. The actual elapsed time between filing the complaint and the issue of determination of dumping was a little over 11 months. As you know, the Tariff Commission has 90 days to determine whehter or not the complaining domestic industry has been injured. On March 1 of last year the Tariff Commission made that determination by finding injury in our case. That was more than 14 months after the complaint had been filed. In April 1973 Treasury published the formal findings of both Treasury and the Tariff Commission- -more than three years after we began our study. A great deal of damage can be done to an industry in three years!

ANTIDUMPING ACT

In retrospect, we of course wish we had moved sooner and more quickly to make our study and conduct the necessary pre-complaint investigation. But there are inherent difficulties, both practical and legal, in any group of U.S. companies quickly and efficiently organizing themselves to collect the information necessary to file an antidumping complaint. Viewed realistically, I do not think we could have moved much more quickly.

But what about Treasury? We do not suggest that Treasury dragged its feet. The antidumping staff has been significantly increased but so has its workload. However, we suggest that, while it might require some budget and staff increases, it would be perfectly feasible for Treasury to make a tentative dumping determination within six months of a complaint's being filed if directed by Congress to do so.

The trade bill passed by the House provides that a withholding of appraisement order would normally be issued by Treasury within six months from the date of publication in the Federal Register of a notice that a complaint has been received. However, it would permit Treasury to extend the period to nine months in more complicated cases. Also, there is no limitation on the time that Treasury could take to publish such a notice after receiving a complaint. We urge you to consider S. 323, which calls for a maximum of six months from the filing of a complaint to a notice of withholding of appraisement.

Further, in connection with the Antidumping Act of 1921, we believe it would be highly desirable to codify some of the Tariff Commission's more recent and realistic interpretations of the statute's injury requirements. Specifically, we believe the law should require the Commission to make an affirmative determination of injury when less than fair value sales of foreign merchandise has caused or are likely to cause more than immaterial injury in any line of commerce in any section of the country. S. 323 would so provide. Finally, we believe that judicial review of determinations by both the Treasury and the Tariff Commission should be explicitly authorized on petition of domestic as well as foreign industries, as provided in S. 323. Under current law only an aggrieved importer has a recognized right of appeal. While the Ways and Means Committee Report expresses agreement with the Treasury

Department that there clearly exists a right of review for domestic industry, this has never been established and is subject to serious doubt. Under these circumstances, the Committee should clarify the Act to remove any doubt of the right of judicial review for all parties to an antidumping proceeding. CONTERVAILING DUTIES; RETALIATION FOR DISCRIMINATION AGAINST U.S. EXPORTS We generally support the Trade Reform bill's countervailing duty amendments, including the establishment of mandatory time tables and extension of the law to cover duty-free merchandise. Here also we believe that judicial review should be provided upon petition of any interested party, as provided in S. 323.

We also support the Trade Reform bill's provisions authorizing the President to take unilateral action against imports from those countries that maintain unjustifiable or unreasonable barriers to U.S. exports or that otherwise engage in discriminatory acts against U.S. commerce.

THE "ESCAPE CLAUSE"

We support in general the Trade Reform bill's proposal to liberalize the "escape clause." However, we question the desirability of conferring upon the President total discretion to decline to act upon a recommendation for relief by the Tariff Commission. Under S. 323 a procedure is provided by which the Congress can in appropriate circumstances override a Presidential determination not to follow a Tariff Commission recommendation for relief.

PRIVATE DAMAGE REMEDY

We also support S. 323's amendments to the Revenue Act of 1916. If a domestic manufacturer unjustifiably sells his product at one price in New York and at another in Chicago and thereby causes injury to competition, he can be held liable for treble damages. But if a foreign manufacturer illegally dumps merchandise in the United States, takes away business by unfair pricing, successfully drives American men and women out of work and damages the prosperity of an industry-even if all this is proved-he is not required to make compensation.

He doesn't even have his wrist slapped. Meanwhile, he has prospered while our people were on short hours or out of work.

We think such a foreign manufacturer should be subject to the same kind of obligation to redress the injury he has caused that domestic manufacturers face. Specifically, we think that the Revenue Act of 1916 should be amended to make it a more realistic vehicle for the recovery of treble damages for injurious international price discrimination. The Act currently makes it possible for an injured U.S. businessman to secure damages only where he can show that dumping was committed "with the intent of destroying or injuring an industry in the United States, or of preventing the establishment of an industry in the United States, or of restraining or monopolizing any part of trade and commerce in such articles in the United States." Apparently no U.S. company has ever succeeded in shouldering this strict burden and establishing this proof.

S. 323 would eliminate this onerous intent requirement and permit recovery where the effect of the price discrimination was to injure competition, the same standard that exists in domestic price discrimination cases.

The members of our Association believe, as do most American manufacturers, that we can compete with overseas manufacturers in a fair ball game. But, despite the Antidumping Act, there is today little incentive for foreign manufacturers to avoid dumping in the United States when it suits their own interests to do so. Indeed, it is frequently very much to their advantage to dump. Dumping gives them an opportunity to invade our domestic market. One of the responses of the Japanese manufacturers to our antidumping case, we are told, was to form a cartel in Japan. This cartel includes all Japanese roller chain manufacturers and is headed up by the largest chain manufacturer in Japan. The purpose of this new cartel is to establish minimum price levels for their products in the United States which, in their opinion, will avoid dumping. It seems rather obvious that previously they were knowingly and deliberately dumping here in the United States. Why not? They are not held accountable for the damage they have caused.

So we especially urge you to consider Title IV of S. 323 which will provide at least the possibility of treble damage suits for dumping.

MFN AND EXIMBANK FINANCING

In concluding I would like to convey to the Committee our members' views on Title IV of the Trade Reform bill. We strongly urge that the Committee report to the Senate a trade bill that confines itself to trade issues and does not attempt to use trade as a lever to reform the domestic policies of other nations of the world, however much we may disapprove of them. We are persuaded that in the long run the cause of both prosperity and stability is served by promoting free, fair and non-discriminatory international trade. Thank you very much for this opportunity to give you our views on international trade legislation.

APPENDIX A-MEMBERS OF AMERICAN CHAIN ASSOCIATION

Acme Chain Division, Rockwell International, Holyoke, Mass.
Atlas Chain & Precision Products Co., Inc., West Pittston, Penn.
Diamond Chain Co., Indianapolis, Ind.

FMC Corp. Chain Division, Indianapolis, Ind.

Jeffrey Manufacturing Co., Columbus, Ohio

Moline Corp., St. Charles, Ill.

Morse Chain, Division of Borg-Warner Corp., Ithaca, N.Y.

Ramsey Products Corp., Charlotte, N.C.

Rexnord, Inc., Milwaukee, Wis.

Union Chain Co., Sandusky, Ohio.

Webster Industries, Inc., Tiffin, Ohio.

[Whereupon, at 12:05 p.m., the committee recessed, to reconvene at

10 a.m., Tuesday, April 2, 1974.]