Businesses urged to exploit trade protection remedies

The local business community must develop expertise in trade protection remedies such as anti-dumping and anti-subsidy measures to prevent unfair competition from importers, experts said at workshops held in HCM City and Ha Noi this week.

Prof Claudio Dordi said EU-Viet Nam anti-dumping cases were primarily caused by the fact that Viet Nam was classified as a non-market economy by EU and the US.

Viet Nam was also used by foreign companies to circumvent Chinese trade tariffs, he said.

Dordi is technical assistance team leader of MUTRAP III, a multilateral trade assistance project in its third phase implemented by the European Commission to help Viet Nam prepare for, carry out and follow up on World Trade Organisation (WTO) commitments.

Because of Viet Nam’s status as a non-market economy, the EU and US required that business decisions and costs of Vietnamese firms be based on the market, and there must be no State interference, he noted.

Vietnamese companies are required to have clear accounting records, according to International Accounting Standards (IAS), and they must show legal stability under bankruptcy and property laws.

In addition, currency exchanges must be carried out at the market rate.

James Lockett of the law firm Baker&McKenzie Viet Nam Ltd said the catfish anti-dumping lawsuit brought by the US against Viet Nam in 2002 was highly significant. But a number of even larger anti-dumping cases against Viet Nam had originated in the EU.

These have involved Viet Nam exports of integrated electronic compact fluorescent lamps, ring-binder mechanisms, zinc oxide, and footwear with leather uppers.

Lockett said businesses should develop a quick response when they were charged with dumping, and should be counseled by professional trade counsels or lawyers.

He said proper strategies, real evidence and persistence to follow each case, among other factors, were important criteria in fighting anti-dumping lawsuits or charges.

Dordi said in the case of footwear, six Vietnamese businesses failed to meet several criteria, including having proper accounting records.

“Four businesses were under obligation to export all or a significant part of the production, while the other two were entirely State-owned, one with a direct management link with the State,” he said.

Three of the businesses had no records, and the records of the other three were not in line with International Accounting Standards.

Vu Ba Phu, deputy director of the Viet Nam Competition Agency, encouraged business associations and companies to develop anti-dumping petitions to prevent unfair competition from importers to Viet Nam.

“Businesses can create a petition with careful counsel from experts and agencies, collect strength from domestic partners, and gain consensus in an association,” Phu said, adding that they should be persistent in chasing the pertinent cases.

The workshops, held by MUTRAP III and the Viet Nam Competition Agency on April 14-15, also included Korea Trade Commission delegates who spoke about their experiences with anti-dumping issues. — VNS

Tags: Vietnam business