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WASHINGTON, D.C. — Vaughan-Bassett Furniture Co. of Galax was one of several furniture manufacturers with the American Furniture Manufacturers’ Committee for Legal Trade testifying before the International Trade Commission in Washington, D.C., last Tuesday.
Furniture makers testified in an all-day hearing that an order should be renewed that places duties on Chinese imports due to China's illegal “dumping” of wooden bedroom furniture, hurting the U.S. market and injuring furniture companies.
Dumping is the illegal practice of flooding the market with underpriced items in an attempt to undermine competition.
The World Trade Organization, made up of 140 countries, has agreed not to participate in dumping.
In 2003, the American Furniture Manufacturers’ Committee For Legal Trade — made up of 25 companies — filed a petition alleging illegal dumping of imported furniture with the U.S. Department of Commerce and the International Trade Commission.
The committee won the case in 2004 and, as a result, dumping duties of about 7 percent were placed on most Chinese bedroom furniture being shipped to the U.S. market.
The duties are a penalty placed on top of the price for illegal imports. If the 7 percent is removed, it will lower the price of the products and will threaten the furniture industry, said Doug Bassett, Vaughan-Bassett’s executive vice president and COO. The special tax allows breathing room for American furniture companies to compete against the low prices of Chinese imports.
Every five years, the ITC reviews the case in an all-day hearing, with testimonies from furniture company representatives and elected officials, to determine whether to revoke the duties against Chinese bedroom furniture, or “sunset” the ruling and the duties for another five years.
The testimony proved that China has continued with illegal dumping, said Bassett.
John Bassett of Vaughan-Bassett Furniture — chair the American Manufacturers' Committee for Legal Trade — spoke in favor of renewing the order, along with Wyatt Bassett, president and CEO of Vaughan-Bassett. Also there to testify in favor of the order was Glenn Prillamen, president and CEO of Stanley Furniture, and heads of other furniture companies from Vermont, California, Mississippi and West Virginia.
“Regardless of where these companies do business, China is injuring [them] and is causing a primary risk to their business,” said Doug Bassett.
The coalition had arranged for about 15 congressman and senators from both parties and from all parts of the country to testify on behalf of furniture manufacturers. But, congress unexpectedly adjourned two weeks ago and all the elected officials went home to campaign for the Nov. 2 election.
While 20 officials sent letters of support to ITC, Rep. Rick Boucher (D-Abingdon) — whose district includes Galax — and Rep. John Dingell of Washington were the only two representatives to testify.
“We are extremely grateful that Rick Boucher cared enough about our employees that he took a day-and-a-half off the campaign trail to come stand with American bedroom workers,” said Doug Bassett.
Boucher noted that the area has seen many hardships in the furniture industry due to an influx of “cheap Chinese imports, coupled with a hard-hitting recession.”
“Were it not for the anti-dumping duty order on imports of wooden bedroom furniture from China, the economic circumstance in our furniture producing localities would be much worse than it is,” said Boucher.
Although Vaughan-Bassett has been able to preserve 700 jobs, Boucher added that Bassett Furniture, also in his district, closed its 323,000-square-foot Bassett facility in 2007, costing 280 jobs.
“With the protection afforded Vaughan-Bassettt Furniture by the anti-dumping order, that company was able to invest $1 million in 2010 to expand its plant in Galax and increase employment in a region that is in need of as much new employment as it can get...” said Boucher. “If the anti-dumping order were revoked, imports of low-priced Chinese wood bedroom furniture would surely flood the market and destroy what remains of our U.S. industry.”
U.S. trade laws are indispensable tools which should guarantee a level playing field and fair opportunity for American workers, he argued.
“I know that the workers of companies like Vaughan-Bassett and Bassett can compete against their counterparts anywhere in the world, as long as the playing field is level,” said Boucher. “Without the protections available under current law, these workers and these companies face substantial and lasting harm.”
Vaughan-Bassett will learn the outcome of the ITC's decision when the commission votes in late November. When manufacturers won the case seven years ago, they received a unanimous vote in favor of the anti-dumping order.
Bassett said he could not release the statistics that were shared in the testimony that proved illegal dumping is harming furniture manufacturers, due to the information being proprietary to the manufacturers affected. That information was only shared between lawyers and the commission members. The trade commission will review dates, sales, profits and market shares to determine if the order is to be renewed.
The commission will also need to determine if the manufacturers were indeed affected by Chinese imports or through the recession.
“China hasn't changed their behavior in the last five years, and we're confident and hopeful that evidence that was presented will lead to a positive outcome of the ITC,” said Doug Bassett. “We think [the hearing] went extremely well, and the facts are overwhelming that it is causing harm to furniture manufacturers, and we have a degree of confidence that it will be in our favor as we await the results in November.”