According to Vu Ba Phu, director of the Ministry of Industry and Trade (MoIT)’s Trade Promotion Agency, for the first time in many years, the US has again applied a global safeguard measure in trade for washing machines.The US is also willing to contradict itself, changing the rules of origin that have been recognized by itself and maintained in the country for years to be able to levy anti-circumvention tariffs on Vietnam's certain corrosion-resistant steel products.
Vietnamese goods have faced 107 trade-defense lawsuits in other countries
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Some other countries are even willing to violate the World Trade Organization (WTO) rules to protect domestic production. Indonesia, for example, only allows the import of smartphones if the company makes that phone also has a production facility in Indonesia, or India bans imports of pepper if prices are lower than the minimum price set by its government.
Nguyen Thi Thu Trang, director of the WTO Center under the Vietnam Chamber of Commerce and Industry (VCCI), said that Vietnamese goods have faced 107 trade-defense lawsuits in other countries, including 78 anti-dumping cases, 12 anti-subsidy cases and 17 anti-tax-evasion cases.
Of the 78 anti-dumping lawsuits, 37 cases are related to iron and steel exports, or nearly half of the total, while three-fourths of the anti-subsidy lawsuits have been filed against these products as well.
As for anti-tax-evasion lawsuits, enterprises in importing countries claim Vietnamese exports are being produced in third countries that are subject to higher anti-dumping taxes than Vietnam. Up to 16 of these 17 cases have been brought by manufacturers in importing markets, who believe Chinese goods have been exported to Vietnam before being shipped to their countries.
Most of the lawsuits have been filed by manufacturers in the United States, India, Turkey, Australia and the European Union. However, Trang noted, producers and associations in Indonesia and other regional countries have recently also petitioned for investigations into Vietnamese exports.
Preventative measures taken
Tran Lan Huong from the Department of Trade Defense under the Ministry of Industry and Trade said that many nations in the world have erected barriers such as trade defense instruments to restrict free trade.
Huong warns that businesses need to avoid trade defense by diversifying their export markets to curb their losses. In markets which have applied trade defense instruments like the US and India, businesses should learn more about their laws and regulations and discover whether these nations have previously imposed trade defense measures on any nation. When the lawsuit is filed, businesses need to deal with the incident by all means.
The Ministry of Industry and Trade recommends that businesses consider hiring lawyers to provide consultancy on trade defense measures which are a combination of complicated issues related to economics, accountancy, finance and law. Businesses need to gain insights into agencies’ methods of investigation to properly prepare documents for any lawsuits.
Lastly, businesses need to identify their strategy and targets, as they can lose costs in such lawsuits but can prevent similar incidents in other markets in future.
At the same time, the ministry advises businesses to strengthen solidarity and cooperation to deal with the similar cases, as foreign nations have imposed tariffs on the Vietnamese market, not specific businesses.
