Commerce to probe dumping claims; NSF pact put on hold

The National Science Foundation stalled a $35 million supercomputer buy last week following the Commerce Department's decision to investigate allegations that Japan's NEC Corp. is dumping supercomputers in the United States.

"It would be inappropriate for NSF to approve this procurement until the dumping issue has been resolved " NSF director Neal Lane said in a statement issued last week.

U.S. supercomputer maker Cray Research Inc. filed a petition with Commerce late last month citing a recent supercomputer procurement at the National Center for Atmospheric Research. Federal Computer Corp. (FCC) Falls Church Va. beat Cray and Fujitsu to win the right to lease four 32-processor NEC SX-4 supercomputers to NCAR for use in climate-modeling research. In its complaint Cray charged that the deal will cost NEC $65 million.

NEC has denied the charges.

FCC senior vice president George Blick last week said his company won the award "fair and square" and expressed frustration at NSF's decision to hold off on approving the contract.

"Basically it just keeps us from getting an award that we worked hard on " Blick said. "There is nothing in procurement law that would prevent NSF from making the award. It is a political issue."

U.S. trade law calls for Commerce to decide if the supercomputers were dumped in the United States. If Commerce decides dumping occurred the case will go to the International Trade Commission to determine if U.S. companies were injured by the dumping. If the ITC finds injury Commerce will require NEC to pay a dumping penalty.

ITC held a preliminary hearing last week. It has until Sept. 12 to determine the injury to Cray. Commerce would then have until Jan. 6 1997 to issue a preliminary decision.