A US panel gave preliminary approval Friday to import duties on more than US$1 billion of wooden bedroom furniture from China in the largest US anti-dumping case yet against Chinese goods.  

The US International Trade Commission (ITC), on a 6-0 vote, said there was "a reasonable indication" that low-priced imports from China were harming domestic furniture makers.

The ruling requires the US Commerce Department to start an investigation to determine an appropriate level of offsetting duties. The ITC will then hold a final hearing in mid-year and issue a final injury determination in the fall of this year.

Twenty-seven US companies and four unions in Virginia, North Carolina and 12 other states have asked for duties from 158 percent to 441 percent to offset what they say is "dumping" by Chinese competitors.

The US government will continue an investigation into whether Chinese makers of bedroom furniture are dumping their products into the US market after the ITC ruling.

China has warned that approval of the steep duties would have "negative effects on normal-US-Sino trade."

Chinese officials said the US method of calculating costs of production for non-market countries on costs in other countries may violate World Trade Organization rules. The US typically uses costs in India as a basis for determining costs of production in China.

However, the Bush administration has pledged to aggressively use US trade protection laws against imports it determines are unfairly priced.

The ITC decision sparked an immediate reaction from US retailers, who formed their own coalition aimed at averting the tariffs.

The coalition of more than 60 US furniture retailers -- including chains such as Rooms To Go, Haverty's, JCPenney and Crate & Barrel -- said the proposed duties would not keep furniture-making jobs in the United States.

"There is no benefit that will come from it. US jobs will not be saved or returned. Instead, US retailer jobs may be lost and US consumers will face major disruptions with price, choices and quality in the short term," Mike Veitenheimer, vice president of The Bombay Company, said in a statement.

"This petition is a brazen and hypocritical attempt by some domestic furniture companies to use the US government to manipulate the bedroom furniture market in their favor, at the expense of American consumers and independent furniture retail stores," said Veitenheimer.

The coalition accused US furniture makers of helping create the Chinese industry as a source of low-cost, high-quality furniture they could resell to retailers.

"This is one of the most cynical trade cases brought before the ITC in recent memory," coalition attorney William Silverman said.

"Once retailers went to China directly, thereby eliminating petitioners' middlemen profits, the group of domestic producers responded by filing this dumping case with the ITC."

(Xinhua News Agency January 12, 2004)