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Thu, Dec 23, 2004 - Page 12 News List

Shares rise on ruling against US tariffs

BLOOMBERG

Shares of Hynix Semiconductor Inc, the world's third-largest computer memory maker, rose after the WTO said US punitive tariffs on the South Korean company violate global trade rules.

Hynix shares rose as much as 2.6 percent after the WTO ruled the US failed to prove banks' loan guarantees and rollovers in 2002 were an unfair state subsidy, supporting a preliminary decision made a month ago.

The removal of the tariffs helps Hynix regain full use of its domestic plants after punitive charges on Icheon, the South Korea-based chipmaker, forced it to divert production to its facility in the US and begin building a factory in China to dodge the levies.

Hynix is forecasting record profit this year amid surging demand for chips after the company piled up losses of US$11.1 billion over four years.

The ruling by the Geneva-based arbiters is still confidential, a US trade official said.

The US will appeal the ruling, and the decision won't necessarily end the duties, the official said. South Korea filed a separate WTO complaint against EU tariffs.

The US and the EU accused South Korea of illegally bailing out Hynix through government-backed financial restructuring packages.

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