Implementing Active Trade Remedies Amidst Accelerating Global Integration

9:24:07 AM | 6/4/2024

Vietnam is an open economy, especially when Vietnam has negotiated and signed many important free trade agreements (FTAs) to open up great opportunities for exports. However, this openness also renders Vietnamese exports more susceptible to trade remedies imposed by certain developed economies.

Vietnam's exports, particularly shrimp and pangasius, are likely to face trade defense investigations

In recent times, there has been an observable increase in anti-circumvention investigations concerning Vietnamese goods. By the end of April 2024, Vietnam's exports had been subject to 249 trade defense investigation cases across 24 markets.

Investigated commodities are relatively diverse, ranging from big exports like wooden cabinets, plywood, solar batteries, shrimp, pangasius and high-pressure washers to smaller exports like foam mattresses, lawn mowers, cigarette wrappers, EPS plastic beads and honey. In addition, foreign investigators also regularly review trade remedy cases with as complicated procedures and requirements as new investigation cases.

As Vietnam faces more investigation cases and is imposed trade defense measures by foreign countries, the business support from authorities, especially the Trade Remedies Authority of Vietnam (TRAV) during the investigation process has brought in positive outcomes, helping exporters gain better outcomes.

According to the TRAV under the Ministry of Industry and Trade, domestic businesses, from previously being unfamiliar, are now increasingly knowledgeable and proactively using defense tools to mitigate risks and damages. 

Mr. Chu Thang Trung, Deputy Director of TRAV, said some industries have certain conflicts with international trade, businesses in those industries also have certain knowledge of trade remedies. Currently, the most initiated investigations are involved with steel, chemicals and rubber products.

Furthermore, early warning has helped businesses proactively respond to foreign trade defense measures and build production and export strategies to minimize impacts caused by foreign trade remedy measures.

By late April 2024, Vietnam had investigated a total of 18 anti-dumping cases, one anti-subsidy case and six safeguard cases and two trade remedy shirking cases.

The Ministry of Industry and Trade received and processed five requests for investigation into the application of anti-dumping measures in the domestic manufacturing industry and the ministry decided to initiate probes into two cases. In addition, the ministry conducted 12 cases of reviewing effective anti-dumping, anti-subsidy and trade remedy shirking measures according to regulations to make sure that these measures are applied to the right subjects, at the right level and under the right conditions. Among these review cases, four are about new exporters, five are annual reviews and three are final reviews.

The Ministry of Industry and Trade has actively coordinated with relevant agencies, localities and trade associations to support exporters in effectively handling foreign trade remedy cases through various activities like providing updated information for them to understand case developments; consulting law matters, investigation procedures, investigation regulations/practices of suing countries and giving specific recommendations and directions for settlement to businesses; approaching, exchanging and consulting with foreign investigation agencies to give Vietnam's views on legal and practical aspects of the cases.

Business support from authorities in handling trade remedy cases has brought positive outcomes. Many Vietnamese companies have managed to prove that they did not dump prices, or the Government did not subsidize or intervene in the market to create unfair advantages for exporters.

In addition, the Ministry of Industry and Trade closely monitors investigation developments from foreign investigation agencies, regularly puts forth legal counter arguments when it finds any signs of possible violations of WTO and international investigation practices. The ministry has also ensured that manufacturers and exporters have the opportunity to exercise their corporate rights in trade remedy cases.

By Huong Giang, Vietnam Business Forum