The International Trade Commission is expected to decide Thursday not to pursue independent action against steel imports, thereby averting undercutting the administrations' new program to aid the domestic steel industry.
But sources at the commission and elsewhere said the vote of the six member commission will be close and that the deciding ballot could be cast by chairman Daniel Minchew. Minchew reportedly leans toward continuting an investigation, but is also wary of upsetting the delicate international diplomatic situation in steel.
A special administration task force headed by Treasury Undersecretary Anthony M. Solomon developed a five-part steel program with a system of minimum prices for imported steel products as the centerpiece of the program.
If steel prices come in below the minimum reference prices (which are based on the costs of the Japanese steel makers), the Treasury would trigger an immediate, accelerated anti-dumping investigation to see whether the steel is being sold below cost.
Two weeks ago, in a move that angered administration officials, the ITC staff recommended that the independent agency should take its own action against steel imports under the "unfair trade practices" section of the nation's trade laws.
The staff report - which the commission voted to keep secret in a 4-to-2 vote - put the commission in an embarrassing position. While the agency has no desire to upset the delicate international negotiations that are part of the so-called Solomon plan, it also does not want to seem to be giving in to the Treasury's position that the agency has no role in prosecuting anti-dumping cases because that role is reserved to Treasury under law.
The more activist, newer members of the commission, formerly the Tariff Commission, think that dumping - selling a product below fair market value, which usually means below cost - is an unfair trade practice that the agency can deal with under section 347 of the trade laws.
The newer commissioners are out to reestablish the reputation of the agency, which for the last several decades has been a relatively unimportant factor in the U.S. trade picture.
The trade commission was refashioned from the tariff commission by the Trade Act of 1974, both to administer various parts of the trade laws and to keep Congress on top of potential trade issues. There are three Republicans and three Democrats on the commission. They serve for nine years; the chairman is appointed to the rotating two-year term by the President.
In October, the commission staff was readily to recommend that the agency institute a formal proceeding against steel imports, but that recommendation was delayed by Minchew, apparently to avoid upsetting the work of the Solomon task force, which was in full swing by them.
President Carter accepted Solomon's recommendations last week. Administration officials are laboriously computing several hundred reference prices for imported steel, in part using cost of production data supplied by Japanese steel makers.
Administration officials, while opposed to giving the trade commission any more powers in the dumping field (its role now is to determine if there is injury to U.S. industry while the Treasury determines there is dumping), are also worried that foreign countries will be less cooperatives with the Solomon scheme if they could face other dumping penalties from the international trade commission.
Under the unfair practices section of the trade law, the commission could issue cease and desist orders or could prohibit imports from entering the country. The President could overturn the decision within 60 days.
Two weeks ago, the six-member commission voted to keep the staff report secret and decided to move into a rare closed-door meeting to consider what to do about the proposal to pursue a formal inquiry. Such an investigation could take a year to reach any conclusion.
Commission sources said a majority of the commission is expected to vote against pursuing the staff recommendation, only the second time the commission has considered taking such action on its own and not in response to an industry filing.
The first such case was its decision not to pursue an "unfair trade practices" injury against the Airbus aircraft produced by a consortium of European countries.