Will Vietnam sue US DOC?

Representative from VASEP said that DOC has been applying the zeroing method to calculate the dumping margin for frozen shrimp imports from Vietnam. Currently, Vietnamese shrimp exporters are assessed the anti-dumping tax rates of between 4.13 to 25.76% when sending products to the US market.

According to VASEP, shrimp export prices depend on the size of shrimps, i.e. higher prices are paid for bigger size shrimp. As Vietnam mostly exports big shrimp, its average export price is always high. This explains why previously, the tax rates imposed by the US on Vietnamese exports were relatively low compared to other countries.

However, not all consignments of shrimp exported by Viet Nam to the US have high prices. As sometimes Vietnam exports smaller size shrimp, it gets lower prices. Meanwhile, the US DOC has been following a calculation method under which it ignores consignments of shrimp which have export prices higher than the average price for that shrimp size, which leads it to conclude that Vietnam dumps the consignments of shrimp that have lower prices.

“This is unfair and this does not follow WTO rules,” said VASEP’s representative. The representative also reiterated that in the second administration review of Vietnamese shrimp exports, 30 Vietnamese shrimp exporters registered for the review, but DOC only chose two of them for its compulsory probe.

According to VASEP, DOC is applying an unreasonable calculation method and has been unjust in setting the anti-dumping margins. It says these are contrary to articles No 1, 6 and 9 in the WTO’s Anti-dumping Agreement (AD).

The decision by DOC has made Vietnam lose its competitive edge over other countries exporting shrimp to the US, including Thailand, which is now imposed the tax rate of 3.18 percent, and India, which is imposed 1.6 percent.

VASEP’s proposal to sue the US DOC is being considered by the government. However, an official from the Ministry of Industry and Trade said that there is a good chance Vietnam could win the lawsuit. According to the official, the spirit of the WTO’s AD is that anti-dumping activities are abolished, not that more tax revenue is generated.

One of the things VASEP has cited to persuade government agencies to proceed against the US DOC is that the agency in charge of settling disputes under WTO considers the zeroing calculation method applied by the US contrary to WTO rules. Other countries have sued the US for this and won the lawsuits.

VASEP has been trying to persuade government agencies that if Vietnam won the lawsuit, it would help stop the disadvantageous decisions imposed by DOC on Vietnamese frozen shrimp and many other industrial products.