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The Ministry of Commerce has decided to drop an anti-dumping investigation on chemicals imported from Japan and South Korea.

The decision came on Friday after the Chinese group involved decided not to go through with its action -- a first among China's anti-dumping cases.

The raw chemicals, pure and polymeric MDI, are widely used in national defence projects and the chemical, medicine and electronic industries.

The ministry began to investigate the case on September 20 last year at the request of the Wanhua Polyurethane Co Ltd.

The company, based in Yantai, East China's Shandong Province, is the sole producer of MDI products in China.

In its application to withdraw the case, Wanhua said MDI imports from Japan and South Korea have increased in price since the investigation began.

Japan's Mitsui Takeda Chemical Industries Ltd, Japanese Poly-urethane Industry Co Ltd and Sumitomo Chemical Co Ltd, and Basf Korea Ltd and the Kumho Mitsui Chemical Industries of South Korea were the foreign companies involved.

The competitive order of the industry is being restored and the current environment favours its healthy development locally, which was another reason Wanhua decided not to pursue the matter.

A public hearing about the case was held by the ministry on September 22 this year.

China has so far filed 24 anti-dumping cases against foreign products, 12 of which were raised after the nation's World Trade Organization entry in December 2001.

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