Washington -- The U.S. International Trade Commission (USITC) has voted to continue a subsidy investigation on U.S. imports of computer memory chips from South Korea.

In a December 13 preliminary determination the commissioners indicated they have found sufficient evidence that allegedly subsidized imports of dynamic random access memory (DRAM) semiconductors substantially hurt domestic producers to let the case continue.

A subsidy is a grant conferred on a producer by a government.

Imposition of countervailing duties requires final affirmative determinations both from the Department of Commerce that a subsidy was provided and from the USITC that the imports injured or threatened U.S. industry.

A preliminary Commerce determination is expected by January 27.

The department took action against Korea in November after a U.S. producer of dynamic random access memory (DRAM) semiconductors had filed a complaint asserting that South Korean DRAM manufacturers received loan subsidies and other government support worth thousands of millions of dollars, according to press reports.

The European Union (EU) started in July a similar investigation against Samsung Electronics Co. and Hynix Semiconductor Inc., the world's number one and number three
chipmakers respectively, which are reportedly also subject to the U.S. investigation.

South Korea denied it had paid subsidies to DRAM manufacturers and threatened to take the case to the World Trade Organization if the United States and the EU impose new tariffs on Korean memory chip imports.

In 2001 South Korean producers generated $14,300 million in overseas sales of semiconductors, according to news reports.

However, the reports said, a sharp decline in semiconductor sales and DRAMs prices the same year hurt the manufacturers considerably and affected negatively the overall growth of the South Korean economy, which is heavily dependent on DRAMs exports.

In another case, the USITC advanced an antidumping investigation into imports of malleable iron pipe fittings from China by making an affirmative preliminary injury determination.

Imposition of antidumping duties requires final affirmative determinations from Commerce on dumping and from USITC on injury.

Dumping is the sale of an export good at a price below the home-market or a third-country price, or below the cost of production.