The Thai government is violating international trade rules in its anti-dumping action against Russian steel imports, Russian officials and their U.S. attorney say, as Moscow mounts its first test case against a rising tide of steel trade complaints.
Steel is a highly competitive global commodity that oftens becomes the subject of dumping claims, a practice that involves selling abroad at unfairly low prices. If Russia finds its challenge to the Thai complaint successful, it may use the same tactic against dumping charges brought by the United States and other countries.
Gary Horlick, with the Washington law firm of O'Melveny & Myers, is representing three large Russian steelmakers - Severstal, Novolipetsk and Magnitogorsk - in a complaint involving hot-rolled steel coil exports to Thailand filed by Thailand's Sahaviriya, also a steelmaker.
Russian steel is also the target of anti-dumping actions elsewhere in Asia, including Taiwan, India and Indonesia.
The European Union, the United States, Mexico and Chile have also sought to check Russian steel exports.
''What is unusual is the concentrated wave of these moves,'' Mr. Horlick said. ''If they are effective, they would cut off about 1.2 percent of the gross domestic product of Russia. This makes for a big trade war against Russia.''
The GDP is the sum of all goods and services produced in a year.
Mr. Horlick added that Russia has received little detail on the Thai claims, although that is needed to prepare for a formal hearing set in Bangkok for Tuesday.
Alexei Ruzhin, a dispute settlement official of the Ministry of Foreign Economic Relations, met in Bangkok last week with Thai commerce ministry officials. ''What we witnessed was some sort of artillery barrage,'' he said.
Mr. Ruzhin said he gave the Thais detailed data on Russian steel production and pricing and they told him they would provide the amount of imposed duties within a matter of days. ''This didn't happen,'' he added.
The Thai steelmaker demanded a duty of 90 percent, which was subsequently cut back to 43 percent, Mr. Ruzhin said.
He accused Thailand of protecting Sahaviriya with the anti-dumping complaint. The Thai steelmaker used to import Russian-made hot-rolled coil but now produces its own.
Mr. Horlick and the government in Moscow say this is the first time Russia has mounted a full-scale counterattack in a steel trade case in Asia.
The Thai investigation should be regulated by World Trade Organization rules, even though Russia's WTO application is pending.
Russian mill representatives strongly deny that Russian export prices are below Russian domestic prices, a key dumping test.
Mr. Ruzhin also accused the Thai government of trying to circumvent price-calculation issues by refusing to treat Russia as a market economy for steel.
International trade dispute rules provide different standards in countries where the state is deemed to control production and pricing.
Thai officials in Moscow have acknowledged the difficulty of comparing Russian price data but say the issue must be addressed in Bangkok.