Hynix Applauds European Commission Move to Lift Countervailing Duties on Hynix DRAMs
On April 7th, 2008 the Council of the European Union formally adopted a decision to lift countervailing duties on imports of dynamic random access memory chips from Korea manufactured by Hynix Semiconductor Inc.
Hynix management greeted the Councils action with praise and a degree
of vindication.
"We commend the Council for taking the right course of action in this matter," said Min Goo Choi, a Senior Vice President at the company. "For five years Hynix and the Government of Korea have fought the imposition of these duties before the European Commission and at the World Trade Organization and we are happy that we have finally secured their just termination," he added.
In 2003 the Council determined that the Government of Korea had illegally subsidized Hynix by allegedly directing banks to engage in a non-commercial financial restructuring of the company. The Councils decision was overturned by the World Trade Organization in 2005 and Hynix continued to press its case within the European court and before the European Commission.
As importantly, during this time, Hynixs financial performance dramatically improved. Hynixs stock price increased by nearly 514% percent over the 2003 2007 period and the company re-emerged as an industry leader. Restructured debt was repaid early and Hynix creditors made substantial returns on debt they converted to equity. Mr. Choi stated that "Hynixs strong performance and return on investment over the 2003-2007 period demonstrates the sound commercial judgment of Hynix creditors back in 2001 and 2002 when they agreed to restructure Hynix debt. There was no government interference, just a wise business decision."
With no justification for continued imposition, the Council agreed to lift the countervailing duties, retroactively effective from December 31st 2007.
"We commend the Council for taking the right course of action in this matter," said Min Goo Choi, a Senior Vice President at the company. "For five years Hynix and the Government of Korea have fought the imposition of these duties before the European Commission and at the World Trade Organization and we are happy that we have finally secured their just termination," he added.
In 2003 the Council determined that the Government of Korea had illegally subsidized Hynix by allegedly directing banks to engage in a non-commercial financial restructuring of the company. The Councils decision was overturned by the World Trade Organization in 2005 and Hynix continued to press its case within the European court and before the European Commission.
As importantly, during this time, Hynixs financial performance dramatically improved. Hynixs stock price increased by nearly 514% percent over the 2003 2007 period and the company re-emerged as an industry leader. Restructured debt was repaid early and Hynix creditors made substantial returns on debt they converted to equity. Mr. Choi stated that "Hynixs strong performance and return on investment over the 2003-2007 period demonstrates the sound commercial judgment of Hynix creditors back in 2001 and 2002 when they agreed to restructure Hynix debt. There was no government interference, just a wise business decision."
With no justification for continued imposition, the Council agreed to lift the countervailing duties, retroactively effective from December 31st 2007.
