U.S. International Trade Commission Rejects Efforts to Impose Trade Restrictions on Imported Crabmeat

(Washington, D.C.) - On July 11, 2000, the commissioners of the United States International Trade Commission voted 4-2 to reject an effort by domestic processors of crabmeat to impose trade restrictions, in the form of additional tariffs and quotas, on imported crabmeat.

Akin, Gump, Strauss, Hauer & Feld, L.L.P. represented a coalition of over 150 companies and trade associations in defeating the “Section 201” petition filed by these domestic processors. Section 201 of the Trade Act of 1974 authorizes the president, upon the recommendation of the USITC, to impose restrictions on any article that is being imported in “such increased quantities as to be a substantial cause of serious injury” to a domestic industry.

Akin Gump worked with lead client Phillips Foods, Inc. of Baltimore, Maryland, to assemble a coalition of opponents to the petition that included the National Restaurant Association; the Food Marketing Institute; the American Frozen Foods Institute; and the nation’s three largest foodservice distributors, Sysco, U.S. Foodservice and Alliant; as well as numerous other crabmeat importers, wholesalers, distributors, retailers and value-added processors. Working closely with this coalition, the firm developed the substantive arguments that it presented to the USITC in two lengthy written submissions and in testimony at a daylong hearing held on June 15. The firm also engaged in lobbying efforts intended to convey to the Clinton administration the extensive degree of domestic opposition to the petition’s request for import restrictions.

The USITC’s negative determination on July 11 is the first time in over five years that it has rejected a petition seeking relief under Section 201. The case is now over because the law does not authorize a judicial appeal. As a result, importers will continue to be able to import crabmeat free of any import restrictions. Domestic demand for crabmeat has exploded in the past three years, largely due to the efforts of Phillips Foods, which has discovered large supplies of blue swimming crabs in Indonesia, Thailand and the Philippines. Phillips employs over 10,000 workers in the Far East who pick this crab by hand and then pasteurize it before shipping it to the United States for sale. Phillips has also established a value-added facility in the inner city of Baltimore that employs over 250 people who make crabcakes, crab soups and other crab-based products that Phillips distributes nationwide.

Founded in 1945, Akin, Gump, Strauss, Hauer & Feld, L.L.P., a leading international law firm, numbers 900 lawyers with offices in Austin, Brussels, Dallas, Houston, London, Los Angeles, Moscow, New York, Northern Virginia, Philadelphia, Riyadh (affiliate), San Antonio and Washington. The firm has a diversified practice and represents regional, national and international clients in a wide range of areas, including antitrust; banking and financial institutions; bankruptcy, reorganization and creditors’ rights; capital markets; communications; corporate and securities; employee benefits; energy; entertainment; environmental; estate planning, wealth transfer and probate; government contracts; health; insurance; intellectual property; international; investment management; labor and employment; litigation; mergers and acquisitions; privatization; project finance; public law and policy; real estate and finance; taxation; and technology. For additional information, please visit our Web site at http://www.akingump.com.