majority notion of industry. It permits a finding of injury to an industry where not all of the producers in question are being injured, but where a majority are.

The CHAIRMAN. Well, in my home town of Baton Rouge, we have one cement manufacturer, for example. Now, let us assume that foreign shipments are directed to Baton Rouge and they just absolutely clobber that one producer but there is no serious injury to the industry as a whole. Would that be a case in which relief could be obtained?

Mr. REHM. It is possible. I think we have to distinguish the general definition

The CHAIRMAN. You say possible, but not likely.

Mr. REHM. No. I think

The CHAIRMAN. You do not know?

Mr. REHM. I do not know, because I do not have sufficient facts which would indicate whether the general national definition of industry we have been talking about should be applied or whether one of the two alternative definitions of geographic segmentation should be applied in this case. It is not impossible, certainly.

The CHAIRMAN. All right, Now, he is being clobbered. You do not know whether he can get relief or not, under what you bring us. That is what you told me. Is that right or not?

Mr. REHM. All I am saying is I do not have enough facts in your hypothetical to determine whether one could.

The CHAIRMAN. It seems to me, that is just the facts you are looking for. Here is one mill. It is being clobbered by dumping, but it is not a significant segment of the overall industry. Now, would it be entitled to relief or not? It seems to me, that is just as clear as anything on earth you are looking for. After you get through hearing all the facts, that is your conclusion. He is being clobbered here at Baton Rouge. But, the industry as a whole is not being significantly injured. Mr. ROTH. Mr. Chairman, it would be my understanding that if there were not a provable regional market where he was being clobbered, it would be difficult to prove injury. But this does not relate to the code so much as it relates to the Antidumping Act itself.

Mr. REHM. I would simply add Mr. Chairman, that if in your case he is the only producer of cement in this area and one could define a marketing area in this portion of Louisiana, then I think under the code you could find injury.

Senator HARTKE. Will you please speak louder?

Senator ANDERSON. Let him finish. What did you say?

Senator HARTKE. I did not hear what you said, either. You faded off.

Mr. Chairman, I would like to have the answer-Mr. Chairman, can we have the answer? I did not hear what he said there. I am sorry. Mr. REHM. Yes, I will certainly repeat it, Senator. I said that if this company was the sole producer in the area and if one could find, and this would require looking at some other factors, I think, that this was a regional market, then I think it would be possible to find injury.

The CHAIRMAN. But, he is not the sole supplier. You have got cement coming out of New Orleans from Lone Star and OKC producing it down there. They sometimes put some of their cement into that

area when they have a surplus. That is just at Baton Rouge, La., where you have other producers shipping cement into it, but that one fellow right there is really being clobbered. Now, could you find injury? Mr. REHM. Mr. Chairman, both under the act and the code one has to conceive of an industry. There has to be injury to an industry. The act does not grapple with the question how you define industry. The code attempts to-to a certain extent. If in your case there were other companies and one could find a regional market but the other companies were doing all right, in spite of the dumped imports; that is, imports at sales of less than fair value, then one could not find injury. The CHAIRMAN. The Tariff Commission sometimes applies a competitive market area test in determining injury.

Can they apply that same test under the code?

Mr. REHM. I believe so. I have to state this generally, because it does turn upon specific facts. But as Ambassador Roth's statement tried to point out, and this is indeed something that I think a lot of people have missed, there are two alternative definitions of geographic segmentation provided for in the code.

Senator HARTKE. What page are you reading from?

Mr. REHM. If you have the committee print, Senator-
Senator HARTKE. I have it. Do not worry. I have it.

Mr. REHM. Page 42.1 And, it is in particular a long sentence but I will try to go through it with you, if you would like. It is under article 4(a) (ii).

The CHAIRMAN. Well, you have two tests in the code, but neither one of them apply to the case I gave you in my hometown.

Mr. REHM. Well again, to repeat, if there were other producers who were fairing well, I do not think either under the code or the act now could you find injury. But, to return to Senator Hartke's questionSenator HARTKE. I did not ask any question.

The CHAIRMAN. I have.

Mr. REHM. I am sorry. I thought you wanted to know—

Senator HARTKE. I wanted the page. That is all I asked for. I have the page.

The CHAIRMAN. Senator, one more and I am coming back to you. Now, the Tariff Commission has found injury in a number of cases just exactly like I gave you.

Mr. REHM. One company? Not to my knowledge.

The CHAIRMAN. Here is their report.

In another case the LTFV, which means sales at less than fair value, imports were found to injure an industry composed of producers in/or adjacent to the competitive market area in which the imports were sold and in three cases such imports were found to affect an industry composed of producers adjacent to the competitive market area.

Mr. REHM. I think, Mr. Chairman, you will note that the Tariff Commission's report on page 192 you just read uses the plural— "producers."

The CHAIRMAN. I am informed that the rules in your code would not permit them to find injury in the case I just described-producers in/or adjacent to the competitive market area in which the imports were sold.

Mr. REHM. Let me speak to that, if I may, since it is an important point, which I notice the cement industry is concerned about and I

1 P. 266 of these hearings.

think reasonably so. This report of the Tariff Commission on page 19 clearly proceeds on the assumption and I think the last sentence of this paragraph so indicates, that there is only one definition of geographic segmentation provided for in the code and that is the notion of transportation costs. I will read the second definition: or, . .

This is, Senator Hartke, the fourth line from the bottom of page 42 on this committee print

or . . . if there exist special regional marketing conditions (for example, traditional patterns of distribution or consumer tastes) which result in an equal degree of isolation of the producers in such a market from the rest of the industry

Now, I have looked at these four cases which are cited in the majority portion of the Tariff Commission's report. I certainly cannot state for sure that this second alternative definition would apply. But, reading those decisions and three of them are very terse indeed I believe it fair to say that one cannot rule out the possibility, and, indeed, distinct possibility, that this second alternative definition could apply in these cases.

The CHAIRMAN. Let me just read you these two sentences from the Tariff Commission report. I am going to read you what I have and the sentences following it:

In another case,

This is Portland Cement from Belgium

the LTFV, which is sale for less than fair market value imports, were found to injure an industry composed of producers in/or adjacent to the competitive market area in which the imports were sold, and in three cases such imports were found to injure an industry composed of producers adjacent to the competitive market area. The Code would limit a regional industry to all producers within such a market who sell all or almost all of their production of the product in question in that market.

Now, assume the market area were broad enough to include New Orleans and the area, let us say, from New Orleans over to Mobile, and as far west perhaps as Lake Charles or Houston and north to Shreveport, which would seem to me to be well within the argument for those who argue for a large market area concept. One could say that if the only injury to competition occurs up there at Baton Rouge, La., involving the fellow who is producing cement there, and those who are trying to compete with him in that area that is not injury to the market area. Here is the Tariff Commission saying that while they could perhaps find injury as the law exists, they could not find it if you are going to say they must find injury to the whole market area.

Mr. ROTH. I think the proof is in the pudding-the fact that they never have found injury where only one company was involved.1

The CHAIRMAN. Now, you are the man who negotiated the agreement and you cannot tell us the answer. Now, if you do not know the answer, how do you expect a businessman to know the answer, or even a lawyer who represents that businessman?

Mr. REHM. Well, my answer, Mr. Chairman, would be that, as in the case of any legal document, one cannot definitively determine in the

1 Clerk's note: Steel jacks from Canada, AA 1921-49 (TD 66-91) involved injury to a single domestic firm.

abstract without the specific facts how a law or an agreement, or a provision thereof, would apply. All I am saying is that in terms of the four cases we have been talking about, I cannot rule out the possibility of the application of this second definition. I think the point you were making perhaps, in part, Mr. Chairman, was that the code talks about the producers in such a market whereas these three cases talk about producers in/or adjacent to. But, I would say that that obviously turns upon the boundary line you want to draw and that is an economic judgment. There is nothing scientific about it.

The CHAIRMAN. Now, the Tariff Commission tells us in four cases out of five where they have found injury, this code that you are bringing us here would bar them from finding injury. That's 80 percent of those

cases.

Now, have you looked at those cases and concluded otherwise?

Mr. REHM. Well, as I was trying to say, their conclusion is clearly based upon an assumption-which is wrong-that there is only one test of geographic segmentation, concerning transportation costs, where indeed you have to find that all the producers within such a market sell all or almost all of their production of the product in question in that market. They were taking only the first test. I think it is clear that with the exception of the first case they cite, the other four would not fall under that provision. But, I am talking about the second alternative test.

The CHAIRMAN. All right. But you still have not answered the question. How about those 80 percent of the cases, four out of five cases? They say your code would make them come out the other way. Are you prepared to say that in those four cases out of five that your code would not make the case come out the other way?

Mr. REHM. No. I cannot without the record before me, Mr. Chairman. The CHAIRMAN. Well, the report is there. You can go look at the

cases.

Mr. REHM. The decisions which I have before me, Mr. Chairman, if you have seen them, are about two paragraphs long. They are a statement of legal conclusions. They do not permit me to see the kind of facts, sir, that were taken into account when the decisions were reached.

The CHAIRMAN. Well, you negotiated this thing. As a lawyer you should have been looking at those cases and the record behind those cases to see how they arrived at them so you would know whether you are giving away industry's rights or whether you are not.

Mr. REHм. Let me say on this very point we were very, very sensitive to this question of geographic segmentation. It was a major issue in the negotiations because other countries have long been suspicious of our concept of geographic segmentation. It was indeed an issue over which we fought bitterly, I may say, during the negotiations and we insisted that there be what we felt to be an adequate geographic segmentation notion in the code. The other countries pressed us very hard to hold us to this first definition of geographic segmentation based on transportation costs. We said that would not be enough, that the Tariff Commission has decided cases in the past which would not fall within that first definition and we needed, if you will, another definition and we finally worked out this alternative language.

The CHAIRMAN. Let me just tell you what I understand you to be telling me. See if we understand one another. You are saying that these Tariff Commission cases have each one been put on a single sheet of paper. I ask whether you have changed the result of those decisions. You say you do not know because all you have to look at is that sheet of paper. When we are passing an act of Congress we have committee reports and hearings that back it up. All you have to do is go look at them and see whether you have changed the results or not.

Now, do you know whether you have changed the results or would not change the results in those cases?

Mr. REHM. Mr. Chairman, all I can say is that this is why the Tariff Commission has divided opinions and our Supreme Court has divided opinions. These things are not black and white. They are not that clear. We were aware of these difficult cases. We certainly looked at the decisions. I do not believe we looked into the complete record but we were satisfied that in the second definition we wrote into the code did give latitude to the Tariff Commission. But I am sorry, Mr. Chairman. I cannot give you an unequivocal answer that it would have reached the same result.

The CHAIRMAN. Let me tell you how the Congress approaches a similar question. We looked at the Miranda case with regard to admissions and confessions. That was decided by a five-to-four vote by the Supreme Court. We said we think that is a horrible decision. It contributes to a major increase in crime in this country and if we can, we are going to reverse the finding in that decision. So, we passed a law seeking to change that Miranda decision.

Now, at the time we did it, the lawyers on the Judiciary Committee and the lawyers in the Senate, of which two-thirds are lawyers, well knew what that decision said and anybody who wanted to could go read the transcript although we did not regard that as necessary. We could read the hearing in the trial decision case, read what the court of appeals said, we could read what the Supreme Court said. It was clear enough to us what we were doing.

But you are telling me that you do not know what you did and what you did not do because looking at the cases about which you were negotiating, you do not know whether you changed the result or not.

Mr. REHM. Mr. Chairman, I think we are talking about different kinds of cases. We are dealing here in this field with very difficult economic judgments based upon quite abstract legal criteria. I think the antitrust field would be a far better analogy if you wish to draw one than the Miranda case where as I recall, you were dealing with specific criteria in terms of even numbers of hours for arraignment and the like.

In this field, where you have very delicate, difficult economic judgments to be made, one cannot be positive. I dare say that any antitrust lawyer would say reading Supreme Court decisions in the antitrust field, that it is hard to see what guidance one can draw for purposes of future problems. So, if you expect me to be unequivocal, I cannot be. The CHAIRMAN. Do you know the facts of those cases? You said that in order to say whether what you are bringing here would change the results you would have to know the facts of the cases. That infers that you do not know the facts of the cases which they say would have changed the result. Now, do you know the facts of those cases?