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Japan rejects US antitrust enforcement request on flat glass

US trade officials said American flat glass manufactures have been unable to penetrate Japan“s US$ 5 billion market, despite price advantages and an agreement to open up to foreign firms, according t…

US trade officials said American flat glass manufactures have been unable to penetrate Japan“s US$ 5 billion market, despite price advantages and an agreement to open up to foreign firms, according to a recent press report. “In light of our growing trade deficit with Japan, in our view it becomes all the more critical that Japan work with the United States in a constructive manner to ensure that all the trade agreements we have reached with Japan are effectively working and they achieve their stated objectives – that is increased sales and market access,” said a US trade official. 11 June 1998: A Japanese survey of flat glass distributors and manufacturers showed most distributors have no plans to increase purchases of foreign flat glass, despite cheaper prices and comparable quality, US officials said. “These findings by MITI (Ministry of International Trade and Industry) convince us that there are clear impediments to competition in the Japanese flat glass market,” the official said. “Otherwise it makes sense that there would be a shift to cheaper foreign glass of similar quality.” The official added that most of the growth in foreign imports into Japan“s glass market has come from Japanese owned affiliates and that the two major US manufacturers, PPG Industries Inc., originally Pittsburgh Plate Glass, and Guardian International Inc., enjoy only a small fraction of the Japanese market. The US trade officials said that US exports account for about 2.8% of the Japanese market (Japan calculates the share at 5.8%), but the two US-owned firms enjoy less than a 1% share, the official said. As a result, Washington unofficially urged Tokyo to request flat glass makers and distributors improve their Anti-monopoly Law compliance programmes through such steps as preparing manuals on prohibited marketing practices. However, Japan has rejected the US request that Tokyo instruct Japanese flat glass makers and distributors to ensure their Anti-monopoly Law compliance. During two-day talks at the end of May to review a bilateral flat glass trade accord of December 1994, Japan told the United States the law is being observed and that the US-demanded instruction would be inappropriate government interference, said an informed source. A US trade official told reporters “we were totally disappointed and upset by the Japanese attitude.” He also declined to say what steps the United States might take in response to Japan“s apparent refusal to observe the anti-monopoly measures.

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