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Pipe, tube makers: Chinese companies perpetuating fraud

Published: Wed, February 10, 2010 @ 12:00 a.m.

By Don Shilling

Pipe and tube imports are being mislabeled intentionally, a lawyer said.

Wheatland Tube and other domestic pipe and tube producers say Chinese companies are cheating to evade duties that were enacted in 2008.

Chinese companies are labeling shipments to make them seem as though they are coming from Malaysia, Vietnam or other countries that don’t face duties, said Roger Schagrin, a lawyer for the Committee on Pipe and Tube Imports.

The domestic producers also found one case of Chinese pipe that had documents describing it as a shipment of used books, he said.

“We think there’s a lot of fraud going on,” he said.

Daniel Porter, a Washington, D.C., lawyer who has represented Chinese companies in trade cases, said he had not heard of the allegations.

“None of my clients are engaged in that. What am I supposed to say? That’s a wild accusation,” he said.

The domestic producers have formed an industry task force that has asked the U.S. government to take law-enforcement action, Schagrin said.

“These domestic producers agree that it is time to elevate this issue to the highest levels in the U.S. government,” he said.

More customs agents may be needed, and discussions with the Chinese government are in order, he said.

“There are companies in China that specialize in creating false paperwork to evade duties, and the U.S. government should get the government of China to shut down these purveyors of fraud,” Schagrin added.

The outcry is tied to a trade case the producers filed in 2007. They said Chinese companies were selling products below the cost of production — which is known as dumping — and benefited from massive government subsidies.

In 2007, China sent 750,000 tons of standard pipe and 150,000 tons of decorative tubing to this country.

There have been no official shipments of the products since duties were enacted in 2008. Duties ranged from 100 percent to 600 percent.

Schagrin said mislabeled shipments started arriving last summer and have totaled in the thousands of pounds.

Standard pipe is used in plumbing, sprinkler systems, fencing and construction.

Wheatland Tube, which has plants in Mercer County in Pennsylvania and Trumbull County, is the largest U.S. producer of standard pipe.

The decorative tubing is used in furniture, fencing and other products.

Last month, Wheatland Tube and V&M Star Steel in Youngstown were among the producers that successfully petitioned the U.S. government for duties on oil-country tubular goods, which is pipe used for oil and natural-gas exploration.


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