A. Introduction of Dumping and Anti-Dumping

I. Dumping

1.1) Definition Dumping is the price of a product when sold in the importing country is less than the price of that product in the market of the exporting country. Thus, in the simplest of cases, one identifies dumping simply by comparing prices in two markets. However, the situation is rarely, if ever, that simple, and in most cases it is necessary to undertake a series of complex analytical steps in order to determine the appropriate price in the market of the exporting country (known as the “normal value”) and the appropriate price in the market of the importing country (known as the “export price”) so as to be able to undertake an appropriate comparison (GATT/WTO)

1.2) Forms of dumping Generally, dumping is divided into three forms:

Persistent dumping is dumping resulting from international price discrimination. Selling product to world market with the price that lower than domestic price to maximize profit of manufacturers, exporters.

Predatory dumping is the temporary sale of a commodity at below cost abroad to drive foreign producers out of business, after that price are raised abroad to take advantage of the newly acquired monopoly power.

Sporadic dumping is the occasional sale of commodity at lower price abroad than domestically in order to avoid unforeseen risks of world market and solve financial difficulties.

Predatory dumping is entirely bad way. Objective of Predatory dumping is not for consumer’s benefit, it is a manifestation of unfair competition. So restriction trade against this kind of dumping is considered to be legalized and allowed to apply for protection of domestic industry against competition. However, defining the form of dumping in reality is very difficult because they can’t understand true purposes of monopolist. Thus domestic manufacturers want the government to protect them from any form of dumping.

1.3) Conditions are considered dumping

The dumping is determined through comparison of prices between normal value and export price:

X= Normal value – Export price

(These prices have to be put at the same level of trade that is usually “EX works”)

If X >0 then there’s a phenomenon of dumping

Determining Dumping Margin:

Formula:

Dumping margin = (Normal value – Export price)/ Export price

De minimis dumping

The margin of dumping shall be considered to be de minimis if this margin is less than 2 per cent, expressed as a percentage of the export price.

Exporting country

Exporting country is producer and exporter of products that are object of anti-dumping case to the importing country. In case, products are not exported directly from producer to importing country but export to the intermediate country and then export to the importing country, so the exporting country is the last country from which products are exported to importing country. In case, products are transshipped through another country (just switch port) or intermediate country which doesn’t produce similar products that the exporting country is the country where product produced.

Importing country

Importing country is the country which imports related product and carries out anti-dumping investigation with that product

Export price

Export price of the product under investigation is one of two types of prices used to calculate dumping margin.

The ways of calculating export price (depending on the conditions, circumstances)

option 1 : export price is the price of transactions between manufacturers or exporters of the exporting country with importers of the importing country

option 2 : export price is constructed export price that bases on the selling price of that import product for the first independent buyer in the importing country; or a constructed value according to the reasonable criteria of competent authorities.

Option 1 is standard export pricing and prior applied for calculating export price (in the normal commerce conditions). When circumstance can’t meet the conditions to apply option 1, the new export price shall be calculated in option 2.

Normal value

Normal value is the selling price of product similar to product under investigation in the exporting market (“like product”). There are three ways to define normal value (apply which certain conditions)

option 1 : Normal value is defined by price of like product in the exporting country (in the domestic market of country where that product is produced)

option 2 : normal value is defined by price of like product form concerned exporting country to the third country

option 3 : normal value is defined according to constructed normal value (normal value =production cost + administrative and selling cost + profit)

Option 1 is standard way to calculate normal value and prior applied for all cases.When circumstance can’t meet the conditions to apply option 1, normal price shall be calculated in option 2 and option 3.

The term "like product" shall be interpreted to mean a product which is identical, i.e. alike in all respects to the product under consideration, or in the absence of such a product, another product which, although not alike in all respects, has characteristics closely resembling those of the product under consideration.

If the importing country is Non Market Economic country, Normal value will be defined as:

The price of third country which has same economical conditions but be recognized Market Economic Treatment country is used to calculate Normal price of product under investigation.

Comparison of Export price and Normal value

There are three ways to compare Normal value with Export price:

Option 1 : Compares weighted average Normal value with weighted average Export price of all transactions of each manufacturer, exporter.

Option 2 : Compares Normal value with Export price of each transaction (or transactions are made on same date or almost same date).

Option 3 : Compares weighted average Normal value with Export price of each transaction if the authorities find a pattern of export prices which differ significantly among different purchasers, regions or time periods, and if an explanation is provided as to why such differences cannot be taken into account appropriately by the use of two above ways.

Some rules have to be followed when compares Export price and Normal value:

Two kind of prices must be compared in the same level of trade (for example : same ex- factory price /wholesale / retail )

Two kind of prices must be defined at the same point of time (or at the nearest points of time).

When comparing price, it’s necessary to pay attention to the differences in conditions and terms of sale, taxation, levels of trade, quantities, physical characteristics, and any other differences which are also demonstrated to affect price comparability in order to have suitable changes.

If Export price and Normal value are determined by two different currencies, it’s necessary to exchange for comparison of price. The exchange rate is rate on the date of sale (the date of sale, the date of the commercial invoice, purchase order ...).

Notes

Dumping margin must be calculated for each concerned manufacturer, exporter. On the basic of dumping margin, the competent authorities of importing country will calculate anti-dumping duty (in any case not be higher than dumping margin) for each manufacture, exporter.

However, if the number of manufacturer, exporter is too much to calculate dumping margin, the competent authorities can only select a number of appropriate manufactures, exporters to investigate (there will be single margin for these manufacturers, exporters) and calculate general dumping margin for group of manufactures, exporters who don’t join investigation by average of single margin principle

However, export product of one country is only sued dumping when:

Dumping margin of 2% or more Quantity or value of export product is sued over 3% quantity of import

commodity (in the country sued) or quantity of export product is less than 3% but total volume or value of defendants in the market of importing country accounts for more than 7% (in case may countries are sued at the same time).

1.4) Roles and economic significance of dumping

a) Roles

Expand market share to increase economies of scale Eliminate competitors to create a monopoly in the importing market Increase profits by increasing sales (the profit on each product can be less but

the absolute gross profit goes up). In addition, increasing profits by reducing costs due to enlarged economies of scale.

Besides that, getting monopoly profit after control market Consolidation and enhance the value of the brand overseas

b) Consequences

Distort market activities that can be retaliated by anti-dumping measures in the importing country

Waste a lot of time and money for legal proceedings Risk of losing market because of high anti-dumping duty

c) Influences of dumping

For exporting country

Positive

Dumping help domestic enterprises expand export market and increase foreign currency

Dumping measure is an important tool of the foreign trade policy for the implementation of specific objectives of social economic development strategy.

Negative

Domestic consumers have to accept a higher price than before because of the price agreement among firms.

Because the purpose of dumping should be highly profitable, some countries use child labor, women and prisoners with cheap labor cost. Consequently, workers are severely abused. China is one of the countries which represented for using prisoner. According to latest data from BIT, the world has over 250 million children aged 5-14 years old that are involved in economic activities.

For importing country Positive

Consumers have the opportunity to choose new goods. Besides that the price is easier to accept.

Faces with goods from foreign country with low price, domestic services must have to find ways to improve the design of goods, machinery and equipment innovation, improve product quality, actively apply advanced technology, human resources to take advantage of lower production costs in order to maintain market position and profit optimization.

Negative

Dumping has also caused many problems for importing country, especially developing countries which have narrow market.

Consumers of importing country have to use low quality goods, counterfeit goods, goods which do not guarantee the safety of food, hygiene, seriously harms people's health.

Some enterprises find ways of smuggling goods, tax evasion, causing losses to the state budget. Moreover due to not compete with foreign product, many domestic enterprises are completely bankrupt. That influences to growth of the economy of the importing country.

Socially, because of bankruptcy, many workers who do not have a job, increasing unemployment, the social evil.That causes difficulty for the social and economic development of the importing country.

1.5) A few examples of dumping

According to the Report of the WTO Secretariat, the period from 1 / 1 - 06/30/2008 the number of anti-dumping cases increased 30% over the same period in 2007, the number of anti-dumping measures also increased, although not many in this period.

16 members of the WTO reported the figure of the dumping investigation in this period is 85 compared with 61 for the same period in 2007. 12 WTO members reported applying 54-dumping measures during the first quarter of 2008, higher than 6% over the same period in 2007. 31of 85 dumping cases are investigated by members of members of the developing countries and 13 of the 54 cases were applied dumping measures by developed countries during the half of 2008. This figure can be compared with 20 investigations which were conducted and 13 measures applied by developed countries during the first half of 2007.

As reported by the WTO members, the number of new investigations from January to June 2008 is the highest of Turkey (13 cases), followed by the United States (12), India (11), Argentina (10), EU (10), Brazil (7), Australia (4), Colombia (4), Ukraine (3), China (2), Canada, Chile, Indonesia, Israel, and South Africa, each country a service. This suggests that the increase in the dumping investigation of countries such as Argentina, Australia, Brazil, Canada, Colombia, EU, Turkey and the United States and

decrease of China, India, South Korea South Africa and Ukraine over the same period in 2007.

Egypt and Japan reported no dumping investigations in the above period.

China is regularly carried out dumping investigations, accounting for nearly half (37) of new investigations during the first half of 2008. This number has increased 76%, an increase of 21 new investigations were conducted on China's export product over the same period in 2007. Then to Thailand, seven new investigations with these country's export products, the EU (5), Indonesia (5), Korea, Malaysia and Taiwan, each member of the 4 cases, Vietnam (3) . Brazil, Canada, India and the United States each have two investigations, Ahentian, Moldova, New Zealand, Norway - Norway, Peru, South Africa, Sri Lanka, Turkey, each country has a dumping investigation .

On goods dumping lawsuits, the first half of 2008, mostly metal products (21), textiles (20) and chemical products (10). In the 21-dumping investigations related to metal products, there are 7 cases of the EU, U.S. 6 cases, 3 cases of Argentina, 3 cases of Colombia, a case of Australian and Canadian.

1/1/2004, Southern Shrimp Alliance (SSA) filed a U.S. Department of Commerce (DOC) and the International Trade Commission (USITC) to sue six countries, including Vietnam, dumping shrimp into the U.S. market. Five other countries are also being sued, including Thailand, China, India, Ecuador and Brazil. According to plaintiffs, the U.S. government needs to use very high taxation levels from 30 to over 200% on shrimp imports from six countries with the reason that "these countries were sold shrimp in the United States at lower price than domestic price" According to analysts, the excess production of shrimp in the world that the U.S. export volume increased, causing difficulties for production and business activities industry, and exacerbate unemployment. "Shrimp is the consumer goods sold in the U.S. with a total volume of imports up to 5-6 billion per year, followed by the value of domestic production declined from 1.2 billion to 560 billion dollars." According to the DOC, in 2002, six countries which have dumping shrimp

lawsuit produced at 2 billion pounds of shrimp (about 900 million kg), twice in 1990. SSA’s proposal, to reduce export, import taxes for shrimps will be raised 40-230% for Brazil, 119-267% for China, 104-107% for Ecuador, 102-130% for Indian , 57% for Thailand and 30-99% for Vietnam.

EU investigated anti-dumping of cold linen with cotton type Country investigating : European Community (EC) Products were investigated: cold sheet with cotton type

Countries has product under investigation : India, Pakistan, Egypt Dated 07/30/1996, the Council of the Union of Cotton and textile industries the European Union (Eurocoton), an association of manufacturers of clothing and similar goods accounted for the majority of European gross products of industry cold linen in Europe, filed anti-dumping lawsuits.

U.S. initiated anti-dumping investigation of electrolytic manganese dioxide, Australia and China September 12 (2007) U.S. Commerce Department announced decision to initiate anti-dumping investigation with manganese dioxide electrolyte goods imported from Australia and PRC (China). Company Tronox LLC (OK) is the plaintiff. Tronox LLC has a factory producing electrolytic manganese dioxide in Nevada. According to HTSUS, electrolytic manganese dioxide is classified in tariff item No. 2820.10.00.00 Primary If ITCdetermines evidence of imports from Australia and China in terms causing damage or threatening physical harm to the domestic industry, the survey will continue. But in cases ITC defines that the initial damage is not serious, the survey will be abolished.

Provisional dumping margins

Nation Margin

Australia 52.94% 52,94%

China 133,76%

Import statistics

AUSTRALIA 2004 2005 2006

Volume (MT) 7.974 15.871 13.675 Value (U.S. $) 9.779.804 20.999.857 19.314.204

CHINA 2004 2005 2006

Volume (MT) 11.327 10.344 15.061

Value (U.S. $) 11.405.514 10.907.162 15.967.124

Source: International Trade Commission, the data page (HTSUS 2820.10.00.00)

II. Anti-dumping

2.1) Definition

AD are measures that the authorities of importing country applies for imported product to counteract dumping

Purpose

Establish a fair competitive environment Protect domestic manufacturers or different importers In some cases, AD is a retaliation when export activity of country is injury

because of importing country’s measures applied on export product

2.2) Example

a. American – China

- China will levy heavy anti-dumping duties on U.S. chicken product, its Commerce Ministry said on Friday, a move likely to aggravate trade relations and antagonise one of the few U.S. industries that profitably exports to China. The ministry's initial investigation showed that U.S. companies had dumped chicken products into the Chinese market

- Chicken wings and feet, virtually worthless in the U.S. market, are a delicacy in southern China. Many U.S. poultry producers count on the

Chinese market to round out their profits. "Chicken feet and wings are not wanted in the U.S. so they sell them to China, they dump them below cost," said Wang Xiulin, president of the Chinese Poultry Association."For over a decade, the U.S. has sent big volumes of chicken to the Chinese market, hurting producers here. Last year, the Chinese poultry industry was really hurting so we asked for this investigation."

- Tyson Foods (TSN.N), an active investor and lobbyist in China, got the lowest duty of 43.1 percent. Pilgrim's Pride Corp. (PPC.N) was hit with an 80.5 percent duty. Most other firms, including Sanderson Farms (SAFM.O), face a 64.5 percent duty.

b. Vietnam – American

- Exporters made their views known on Tuesday at the office of the Viet Nam Association of Seafood Exporters and Producers (VASEP) in HCM City after the US Department of Commerce (DOC) unofficially said the anti-dumping tariffs on Vietnamese tra fish could reach US$4.22 per kilo, equalling 130 per cent of the selling price of the Vietnamese tra fish in the US market.

- The association's general secretary, Truong Dinh Hoe, said: 'We absolutely oppose the (preliminary) decision made by the DOC in its last review of its tariffs.' Hoe said in the last review, the DOC used the Philippines, instead of Bangladesh, as the third-country market to determine the dumping tariff margins for Vietnamese tra fish, thus causing the tariffs to rise. Hoe said that the comparison of tra fish product prices in the Philippines and Viet Nam was inappropriate as fish feed in the latter was priced $0.5 per kilogramme compared with $2 per kilogramme for the former. He added that production and management costs in the Philippines were also much higher than in Viet Nam.

- It's not reasonable to impose the figures collected from 36 breeding ponds with a total of 12 tonnes per year in the Philippines with the breeding farms totalling 1 million tonnes of tra fish in Viet Nam,' said Hoe.

- Duong Ngoc Minh, deputy chairman of VASEP, said the association should prove that imposing such sky-high anti-dumping tariffs on Vietnamese tra fish would not only damage Viet Nam's tra fish production but also cause losses for American customers. If the new high tariffs are imposed in March next year, many tra fish exporters will certainly leave the

American market, according to an official from the Ministry of Agriculture and Rural Development (MARD), who declined to be named.

Consultancy:

Vo Thanh Thu - International Economic Relations, Publisher: Thong ke

http://chongbanphagia.vn/

http://www.jurisint.org

http://www.wto.org

http://www.tin24.com/

http://www.dddn.com.vn/

http://www/vietbao.com.vn/

III. Agreement WTO on anti-dumping

3.1) History :

- 1964-1967 : Kennedy Round ( Tariffs and Anti-dumping measures )

- 1973-1979 : Tokyo Round ( Tariffs and Anti-dumping ) interpreting Article 6, replacing the Kennedy Round code

3.2) Provisions on anti-dumping

a. Principles

The competent investigation can only apply anti-dumping measures against imported products, which were based on results of the survey. They determined that

(i) Dumping

(ii) Injury

(iii) a causal link between the dumped imports and the alleged injury

- A determination of injury shall be based on positive evidence and involve an objective examination of both

o The volume of the dumped imports. The investigating authorities shall

consider whether there has been a significant increase in dumped imports, either in absolute terms or relative to production or consumption in the importing Member

o The effect of the dumped imports on prices in the domestic market for like

products. The investigating authorities shall consider whether there has been a significant price undercutting by the dumped imports as compared with the price of a like product of the importing Member, or whether the effect of such imports is otherwise to depress prices to a significant degree or prevent price increases, which otherwise would have occurred, to a significant degree.

o The consequent impact of these imports on domestic producers of such

products. The examination of the impact of the dumped imports on the domestic industry concerned shall include an evaluation of all relevant economic factors and indices having a bearing on the state of the industry, including actual and potential decline in sales, profits, output, market share, productivity, return on investments, or utilization of capacity; factors affecting domestic prices; the magnitude of the margin of dumping; actual and potential negative effects on cash flow, inventories, employment, wages, growth, ability to raise capital or investments. This list is not exhaustive, nor can one or several of these factors necessarily give decisive guidance.

- A determination of a causal link between the dumped imports and the alleged injury: The demonstration of a causal relationship between the dumped imports and the injury to the domestic industry shall be based on an examination of all relevant evidence before the authorities. The authorities shall also examine any known factors other than the dumped imports which at the same time are injuring the domestic industry, and the injuries caused by these other factors must not be attributed to the dumped imports. Factors which may be relevant in this respect include, inter alia, the volume and prices of imports not sold at dumping prices, contraction in demand or changes in the patterns of consumption, trade restrictive practices of and competition

between the foreign and domestic producers, developments in technology and the export performance and productivity of the domestic industry.

- A determination of a threat of material injury shall be based on facts and not merely on allegation, conjecture or remote possibility. The change in circumstances which would create a situation in which the dumping would cause injury must be clearly foreseen and imminent. In making a determination regarding the existence of a threat of material injury, the authorities should consider, inter alia, such factors as:

+ a significant rate of increase of dumped imports into the domestic market indicating the likelihood of substantially increased importation;

+ sufficient freely disposable, or an imminent, substantial increase in, capacity of the exporter indicating the likelihood of substantially increased dumped exports to the importing Member's market, taking into account the availability of other export markets to absorb any additional exports;

+ whether imports are entering at prices that will have a significant depressing or suppressing effect on domestic prices, and would likely increase demand for further imports; and

+ inventories of the product being investigated.

b. Conditions for conducting anti-dumping

- The application shall be considered to have been made "by or on behalf of the domestic industry" if it is supported by those domestic producers whose collective output constitutes more than 50 per cent of the total production of the like product produced by that portion of the domestic industry expressing either support for or opposition to the application. However, no investigation shall be initiated when domestic producers expressly supporting the application account for less than 25 per cent of total production of the like product produced by the domestic industry.

- An application under paragraph 1 shall be rejected and an investigation shall be terminated promptly as soon as the authorities concerned are satisfied that there is not sufficient evidence of either dumping or of injury to justify proceeding with the case. There shall be immediate termination in cases where the authorities determine that the margin of dumping is de minimis, or that the volume of dumped imports, actual or potential, or the injury, is negligible. The

margin of dumping shall be considered to be de minimis if this margin is less than 2 per cent, expressed as a percentage of the export price. The volume of dumped imports shall normally be regarded as negligible if the volume of dumped imports from a particular country is found to account for less than 3 per cent of imports of the like product in the importing Member, unless countries which individually account for less than 3 per cent of the imports of the like product in the importing Member collectively account for more than 7 per cent of imports of the like product in the importing Member.

- Investigations shall, except in special circumstances, be concluded within one year, and in no case more than 18 months, after their initiation.

3.3) EU anti-dumping procedure

1.Pre-initiation and initiation

In the EU, most new anti-dumping investigations are initiated on the basis of a complaint from Community producers. These complaints must contain evidence of dumping and injury. EU authorities also require a showing of a Community interest. Once a complaint is received, the European Commission has 45 days to accept or reject a complaint. In that period, it will examine the

content of the complaint and consult with the so-called Anti-Dumping Committee which is made up of 27 EU Member State representatives.

If the Commission considers that the complaint is sufficiently substantiated, it will initiate an investigation and publish a notice in the Official Journal of the European Union. Prior to initiating the investigation, it will notify the relevant governments of the country of origin of the allegedly dumped goods.

A new investigation will not be initiated if, (i) there is insufficient evidence of dumping and/or injury caused by dumping; (ii) the level of dumped imports is de minimis(e.g. if the market share of the dumped imports is less than 1%); or (iii) the complaint is not made by or on behalf of the Community industry. As regards the latter case, a complaint is made by or on behalf of the community industry when:

(1) It is supported by those Community producers whose collective output constitutes more than 50% of the total production of the like product produced by that portion of the Community industry expressing either support for of opposition to the complaint; and

(2)Community producers expressly supporting the complaint constitute more than 25% of the total production of the like product produced by the Community industry.

2.Submission of information to the Commission

When the Commission publishes the notice of initiation of an anti-dumping investigation, it will provide basic information about the scope of the investigation (e.g. the allegedly dumped product) and request information from interested parties. Generally, there are very short deadlines for the submission of the information requested by the Commission. Although deadlines can sometimes be extended, most information initially requested by the Commission must be submitted within 40 days or less.

For exporters especially, providing the type and scope of information requested by the Commission can be very burdensome. Nevertheless, it is in their interest to cooperate. Exporting producers that cooperate often receive a much lower duty in EU anti-dumping investigations than those that do not. For example, in a recent investigation concerning candles, numerous cooperating producers received a zero duty while non-cooperating producers

were subject to an anti-dumping duty of 549.33 EUR per tone. As a result, cooperation can provide a significant competitive advantage.

3.Questionaires and response

When an investigation in initated, the Commission will request detailed information from interested parties primarily related to prices and costs associated with the allegedly dumped product. This information is used for the dumping and injury calculations. Parties are normally given 40 days to reply and an extension of up to 14 days is sometimes available.

If the Commission considers that the number of cooperating exporters, Community producers and/or importers/users will be too large to individually analyse all of their information within the 15 months it has to complete an investigation, then it will not immediately request detailed questionnaire responses. Instead, in the notice of initiation, the Commission will request more limited “sampling” information like the following is usually requested:

(1)Name, address, e-mail address, telephone, and fax numbers and contact person;

(2)The turnover in local currency and the volume in tones of the product concerned sold fot export to the EU during a particular one-year dumping “investigation period” ending shortly before the initiation of the investigation( e.g. 1 July 2008 to 30 June 2009);

(3)The turnover in local currency and the volume in tones of sales of the product concerned on the domestic market during the same dumping investigation period

(4)The precise activities of the company worldwide with regard to the production of the product concerned;

(5)The names and the precise activities of all related companies involved in the production and/or selling( export and/or domestic) of the product concerned; and

(6)Any other relevant information that would assist the Commission in the selection of the sample.

The “sampling” information received is then used to choose a limited amount of exporters, Community producers and/or importers/users that will be required to fill out the more detailed questionnaire. The Commission

normally chooses the companies with the largest representative volume of production, sales or exports to be included in the sample.

4. Market-economy and individual treatment requests

Exporting producers from non-market WTO countries such as China and Vietnam may request market economy treatment in an EU anti-dumping investigation. If an exporter wishes to claim market economy treatment, questionnaires must normally be requested from the Commission within 10 to 15 days of initiation of the investigation and completed responses must be submitted to the Commission within 40 days. Where granted, the Commission takes into account the normal value and export price of the particular exporter granted market economy treatment.

Under EU rules, exporting producers from non-market economies are also able to request individual treatment. Like for market economy treatment, questionnaires for individual treatment must normally be requested from the Commission within 10 to 15 days of inititation of the investigation and completed responses must be submitted to the Commission within 40days of initiation. Where granted, the Commission takes into account the export prices of the particular exporter granted individual treatment and compares it with the countrywide normal value established. These export prices are also used when determining the injury margin.

5.Investigation

Following the submission of questionnaire responses, the Commission will begin to analyse the information received. It will also ask for supplementary/additional information in some cases. As part of its investigation process, the Commission will conduct on-site investigations for the purpose of verifying information provided by companies in their questionnaire responses. These verifications typically take from 3 to 5 days, but sometimes more.

Parallel to the Commission’s own investigation, interested parties are given a right to inspect non-confidential versions of information submitted by other interested parties. Such information includes questionnaire responses, comments on dumping, injury and other matters.

During the investigation stage, the Commission will also schedule time for hearings so that interested parties may present their views orally. Hearings are generally ex parte,i.e between the party concerned (e.g. an exporter) and the Commission. Importers, exporters, representatives of the government of the exporting country and Community complainants may also request to meet parties with adverse interests in a so-called “confrontation meeting”. In the latter case, cooperation by any party is not mandatory.

6.Provisional anti-dumping duties

Provisional anti-dumping duties may be imposed at any time between 60 days and 9 months after inititation of proceedings. In practice, these are generally imposed only once the Commission has conducted on-site verifications/

In order to apply provisional anti-dumping duties, the Commission must have reached a provisional determination that dumping exists and is causing injury to the Community industry. It must also be convinced that the Community interest calls for intervention to prevent such injury. Further, the Commission must be sure that the proceedings have been properly initiated and that interested parties have been given an adequate opportunity to make their views known and to submit information.

7.Disclosure of findings

Interested parties may request in writing the disclosure of the underlying essential facts and considerations on the basis of which any provisional measures are imposed. Disclosure is normally provided in writing shortly following the publication of the decision to impose provisional anti-dumping duties

Interested parties are also entitled to request disclosure of the essential facts and considerations and the basis on which the Commission intends to recommend the imposition of definitive measures, or the termination of an investigation without the imposition of measures. Disclosure is in writing and is normally made at least one month before the Commission begins the formal process of proposing either the termination of proceedings or the imposition of duties. Interseted parties may respond to such final disclosures

only within the short period set down by the Commission. Normally this period is 10 days.

8.Outcomes

a) UndertakingsInder EU law, exporters may offer so-called undertakings to the

Commission once there has been a provisional determination of dumping and injury. Normally, undertakings may not be offered following the end of the period provided by the Commission to comment on the final disclosure. Undertakings are offers submitted by exporters to revise export prices ro to cease exports at dumped prices in a manner which would eliminate the injurious effect of the dumping. Where undertakings are accepted, any provisional or final anti-dumping duties do not apply to imports of the product covered by the undertaking. The advantage of price undertakings for expoerters is that they can keep the additional income resulting from the price increase, whereas anti-dumping duties are paid to the EU.

b) Termination of the proceeding

The Proceeding will be terminated and anti-dumping measures will not be imposed if there is a finding of no dumping, no injury caused by dumping or that anti-dumping duties would be against the Community interest. Proceedings will also be terminated if the dumping margin or volume of imports is de minimis or if original complaint has been withdrawn.

C) Definitive duties

The Commission will propose definitive duties if the facts finally show that there is dumping and injury caused thereby, and the Community interest calls for intervention. In such cases, the proposal is submitted to the Council after consultation with the Anti-Dumping Advisory Committee, following which the proposal will be adopted unless the Council decides within a period of one month by a simple majority to reject the proposal. There are 27 EU Member States at the present time. Therefore, anti-dumping duties are not imposed in cases where 14 out of the 27 Member States reject a proposal. Typically, Member States vote in line with their national economic interest. Thus, southern and eastern European countries with larger manufacturing industries are inclined to vote for anti-dumping measures, whereas the more

service-oriented, import dependent northern European countries tend to vote against duties. Many EU Member States, however, do not necessarily have a strong interest either way; therefore, whether they vote for or against anti-dumping duties changes from case to case.

9. Reviews

Once anti-dumping duties have been imposed, EU anti-dumping law provides for a number of review possibilities, including: (1)interim reviews; (2) refunding reviews/administrative reviews; (3) expriry reviews(sunset reviews)

- Interim reviews: Interim reviews are primarily initiated to determine whether dumping and/or injury has increased or decreased. Interim reviews may also be initiated to re-examine the Community interest, product scope and other matters concerning the need for the continued imposition of anti-dumping measures. Interim reviews may be initiated by the Commission or at the request of a Member State, exporter, importer or Community producer. Requests for review from exporters, importers or Community producers may only be accepted if at least one year has elapsed since the imposition of the anti-dumping measures.

- Refunding reviews: If, following the imposition of anti-dumping measures, prices of the dumped product decline, remain the same or do not sufficiently increase, a refunding reviews may be initiated. If there is a positive determination in this regard, then dumping margins will be recalculated taking into account the lower export prices, and there is a refunding amount of money if the tax rate is higher than the real dumping action.

- Sunset reviews: Anti-dumping measures normally expire five years from the date of their imposition or from the date of the most recent review that covered dumping and injury. However, they will not automatically expire if a sunset review is requested and initiated. Sunset reviews may be requested by Community producers up until three months before the expiration of anti-dumping measures. They may also be initiated by the Commission without a request. If a review is initiated, anti-dumping duties will normally be extended for an additional five years if it is definitely determined that (i) dumping and injury would continue or recur if anti-dumping measures expire; and (ii) continued anti-dumping measures would not be against the Community interest.

Timeline of EU procedure:

0 DAY petition by EU producers

45 DAYS initial of proceeding by European Comission

85 DAYS or less submission of information to the Comission

Questionnaire and response within 40 DAYS after receiving questionnaire from Comission

12 MONTHS (Normally) after initial of proceeding : Investigation start

After investigation and within 10 days: disclosure of finding(determination of whether dumping or not)

After determination: Outcomes: Undertakings, Termination of the proceeding or Definitive duties

5 YEARS: Sunset reviews to determine continuous anti-dumping duties or not

4. Us anti-dumping procedure

In general, the procedure of antidumping of EU and US are similar. The main steps ín US are also like EU

1.Petition and initial of proceeding2.Preliminary investigation of injuries3.Preliminary investigation of dumping and provisional anti-dumping duties(if

needed)4.Questionaire and response5.Final determination of injuries by ITC(U.S. International Trade Commission)6.Final determination of dumping by DOC(U.S. Department of Commerce)7.Imposition of anti-dumping duties or termination of investigation8.Reviews

However, there are differences between the US and EU in the timeline of procedure and the authorities, here is the summary of US procedure:

0 DAY If a U.S. producer feels foreign competitors are charging a price in their market at less than the cost to produce the item, and are able sustain the unfair price because they charge more for the goods in their home market and/or receive financial assistance from their government to gain market shares in foreign economies, then producers in the U.S., representing at least 25% of domestic production, can file a petition with the Import Administration (IA) of the U.S. Department of Commerce (DOC).

20 DAYS A decision is made to accept the petition or not

45 DAYS If the Petition is accepted the International Trade Commission (ITC) will make a preliminary determination of injury or threat of the unfairly traded imports. If no indication of injury the investigation is terminated

190 DAYS Both the ITC and the IA will make affirmative preliminary determinations after analyzing sales information provided by foreign producers and exporters

75 DAYS After the preliminary determination, the investigation proceeds with on-site verification of the data submitted by the foreign party doing the dumping and /or subsidizing. A final determination is announced by DOC about dumping and another by ITC about injuries.

1 WEEK later, anti-dumping duties will be imposed5 YEARS After a dumping determination has been made and duties have been announced against the offending country, the ITC shall conduct a review, called a "Sunset Review," to determine whether revocation of the antidumping duty order would be likely to lead to a continuation or recurrence of dumping and of material injury within a reasonably foreseeable time.

B WORLD, VIETNAM AND ANTI DUMPING

I. ANTI DUMPING ON THE WORLD:

1.1. Anti Dumping investigation Trends:

Trade protectionism refers to the imposition of duties or quotas on imports, in order to safeguard domestic industry against foreign competition. Anti-dumping duty forms a pertinent part of such trade protection measures. When any article is exported from any country to another foreign at less than its normal value, then the government of the latter country imposes an anti dumping duty, not exceeding the margin of dumping in relation to the article. According to World Trade Organization (WTO) rules, countries are allowed to slap restrictions on dumped goods if it is proved to cause damage to their domestic producers. It is to be understood that imposition of Anti Dumping Duty is based on Commodity to Commodity, country to country and suppliers in exporting countries.

Recent Declines: The year-wise anti-dumping initiations reveal an increase from 157 initiations in 1995 going up to 371 initiations in the year 2001, and thereafter there is a steady decline. The decline in the number of anti-dumping initiations is a welcome trend as there is scant support in economic literature for anti-dumping action.

Looking back over a long period of time, it is noted that global anti-dumping is cyclical, with lows in 1980s, around 1987-89, around 1995 and in 2007. Amidst wide speculations about increased anti- dumping during recession, the World Trade Organization in Geneva announced that there was a 17 % rise in its anti-dumping investigations in the second half of last year, compared with the same period in 2007. Anti-dumping actions tend to increase in times of downturns and can be apprehended as early signs of other trade disputes between nations which may emerge in the future.

Anti-dumping investigations initiated 1995-2009

0

50

100

150

200

250

300

350

400

1995 1996 19971998 1999 20002001 2002 20032004 2005 20062007 2008 2009

Antidumping during recession: The exact number of cases in 2008 was 213. It can be said that the expected increase in anti-dumping as a result of economic crisis, has not yet taken place. The injury caused by the global crisis cannot be attributed to any imports determined to be dumped as WTO obligations insists on the separation of other causes of injury from the dumped imports. But it is also true that, in good economic times, companies are less likely to make anti-dumping complaints. Thus, more difficult economic times make the use of anti-dumping more attractive to industries facing low price competition from imports.

During the five-year period 1985-1989, the traditional users of anti-dumping, namely the US, the EC, Canada and Australia accounted for 90% of the anti-dumping inititations which came down to 70% in the next five year period 1990-1994. During the subsequent 10 years (1995-2004), after the WTO was established, these four traditional users made a mere 36% of the total. A major trend discernible is the increasing use of anti-dumping by the new users and developing cuontries. According to WTO statistics, India accounted for the largest chunk were taken against products from different countries during 1995-2009.

Anti dumping investigations 1995-2009

596

440406

270212 208

0

100

200

300

400

500

600

700

India USA EU Argentina South Africa Autralia

Anti dumping investigations 2009

3128

26

2017

15

0

5

10

15

20

25

30

35

India Argentina Pakistan USA China EU

India initiated the most investigations from 2005 to 2009. It had a decline 31 from 55 investigations it had initiated in 2008. USA had the second highest number of initiations 20, up from 16 investigations initiated in 2008.

The WTO Secretariat reported that in 2009, 23 Members initiated 201 anti-dumping investigations against exports. This compare from 2008, during which 19 WTO Members had initiated.

1.2. China-the most frequent subject to anti-dumping

Main target of anti dumping 2009

77

14 11 11 10 8 7 73

0

10

20

30

40

50

60

70

80

90

China US Taiwan Brazil Indonesia Thailand India Korea Viet Nam

China’s products were the most frequent subject to new anti-dumping measures in 2009 (77) compared in 2008 (76)

China's enterprises in the anti-dumping proceedings are in the passive situation and China's government policies have lagged behind large, in our study the current critical situation in need of anti-dumping what role it plays, what policies will further strengthen the country's export enterprises prevention awareness, actively engaged abroad and avoid anti-dumping, insure our country the foreign trade keep on stabilizing the growth wait an each aspect's creation to influence actively.

Due to the rich resource in the labor and the other aspects, China has become one of the world’s largest resources products exporting nation. With the growth of the commodity exported, the anti-dumping cases are encounted more offenly. Since 1995, China has been performing as the target nation of anti-dumping.

Trend and Characteristics in the Anti-dumping Cases of China Targeted:

1# Quick increase in the amount of the anti-dumping cases;

2# Great losses resulted;

3# Developed countries mostly initiated;

4# Quick increase of the anti-dumping cases of China targeted from the developing countries;5# Percentage of anti-dumping cases being taken measures distinctly higher than the average rate;

6# Products scope ranges wide, highlighted in the products with high advantages;7# Mostly the enterprise taking general trade encountered the anti-dumping.

1.3. Anti dumping sector

Anti dumping sector 2009

47

4429

21

20Chemicals

Base metals

Plastics

Machines

Textiles

The largest number (47) of investigations initiated in 2009 involved products classified in the chemicals sector of the Harmonized System of Tariff Classification. The second most affected sector was base metals, which includes iron, steel and aluminium products, with 44 investigations initiated.

Anti dumping sector 1995-2009

1006

746

476

335294

Base metals

Chemicals

Plastics

Machines

Textiles

From 1995 to 2009 the sector most affected by final measures was base metals. The chemicals sector was second most affected, and the plastics sector was third. Of the measures on products in chemicals sector, the largest number was imposed by China (122), followed by USA. (47). In the metals sector, China (121) accounted for the most measures, followed by Russia (60). In the plastics sector, China imposed the largest number of measures (39), followed by Korea (37)

1.4) What’ve happened?

a) US

The antidumping law of the U.S creates a lot of bitterness and ill will among the countries of the world. For many years, this law has been the instrumental in making domestic production flourish at the cost of foreign production. While the antidumping law is originally meant to redress unfair trade, a careful scrutiny exposes its fallacy.

Follow the AD law about NME of USA

The Commerce Department employs another methodology altogether for imports from “non market economies” (NME), that is, China and members of the former Soviet bloc.15 In NME cases, Commerce rejects home-market prices as unreliable, since they are not the product of genuine market transactions. Constructed value is also rejected on the ground that the company’s costs are likewise not market based. Instead, Commerce obtains the company’s “factors of production”—the physical quantities of all the inputs used in producing the merchandise—and values those inputs on the basis of prices in a “surrogate country.” Surrogate countries are market economies judged to be at a level of economic development similar to that of the NME country in question.

Commerce then compares U.S. prices to a cost based normal value derived from company-specific factors of production and surrogate-country prices of those factors (including surrogate country averages for selling, general, and administrative expenses and profit).

In 2003, amidst claims of dumping, the U.S. imposed 37 to 64 percent tariffs on imports of catfish from Vietnam. As a result, Vietnamese exports of

catfish to the U.S. market sharply declined. This also adversely affected the economic stability of Vietnam households engaged in catfish trade. In addition, the antidumping shock triggered significant exit from catfish farming. Households adjusted by moving out of catfish aquaculture and into wage labor markets and agriculture. Moreover, in 2004, the imposition of the preliminary anti-dumping duty on shrimp imports once again drew the global attention on the anti-dumping practices of America. US Commerce Department’s imposition of duties on shrimp imports from third world countries including China and India received severe criticism by the affected countries who decided to fight against this irrational use of antidumping policies by the US.

However, possibly the worst distortion of the antidumping law is the practice known as "zeroing." This method is responsible for the overestimation of dumping margins and subsequent application of inflated antidumping duties. In a typical antidumping investigation, the U.S. Department of Commerce calculates dumping margins by the zeroing method. Under this method, DOC calculates weighted-average net prices for each product sold in the US and compares them to the product's normal value. The difference between the normal value and that in US is treated as the dumping amount. Under zeroing, when the U.S. price is higher, the dumping amount is set to zero rather than its calculated negative value. All dumping amounts are then added and divided by the aggregate export sales amount to give the overall dumping margin. Zeroing thus eliminates negative dumping margins from the calculation and thus gives rise to an overstated dumping duty.

b) EU

Anti-dumping duties may only be imposed if a product is found to be dumped. Under EU rules, a product is considered as being dumped when the export price of a product is less than the normal value of the same or like product not sold for export to the EU.

Calculating normal value

Under EU rules, normal value in market economy countries may be calculated in one or more of the following ways:

(1) on the basis of domestic sales prices of the exporting producer;

(2) on the basis of prices of other exporting sellers or producers in the same country;

(3) on the basis of export prices to a third country; or

(4) by constructing a normal value based on the costs of production plus a reasonable amount to cover selling, general and administrative costs and profit.

Non-market economies

If a good originates from a non-market economy country, then normal value will not be determined with respect to the rules discussed above. Instead, normal value will usually be determined on the basis of the price or costs in an "analogue" market-economy third country (e.g. Australia). If this is not possible, normal value may be determined on any other reasonable basis, including the price actually paid or payable in the EU for the like product. Countries which are considered to be non-market economies include: Albania, Armenia, Azerbaijan, Belarus, China, Georgia, North Korea, Kazakhstan, Kyrgyzstan, Moldova, Mongolia, Tajikistan, Turkmenistan, Uzbekistan and Vietnam. In practice, the use of the non market economy normal value methodologies leads to higher antidumping duties. However, if exporting producers are able to successfully persuade EU authorities to use a market economy "analogue" third country with similar costs of production for the normal value calculation, then the outcome of the dumping investigation is usually significantly improved.

Exceptionally, EU law also permits exporting producers from China, Vietnam, Kazakhstan and any other WTO non-market economy country to request "market economy treatment" or "MET". If successful, their normal value is primarily based on their own domestic prices and not third country prices. Market economy treatment is granted when the following five criteria are met:

(1) decisions of the firm regarding prices, costs and inputs are made in response to market signals reflecting supply and demand, and without

significant state interference, and costs of major input substantially reflects market values;

(2) the firm has one clear set of basic accounting records which are independently audited in line with the international accounting standards and are applied for all purposes;

(3) the production costs and financial situation of the firm is not subject to significant distortion carried over from the former non-market economy system, in particular in relation to depreciation of assets, other write-offs, barter-trade and payments via compensation of debts;

(4) the firm concerned is subject to bankruptcy and to property laws which guarantee legal certainty and stability for the operation of firms; and

(5) exchange rate of conversions are carried out at the market rate. Companies granted MET almost always receive a substantially lower dumping margin than companies not granted MET. Obtaining such "market economy" status can therefore result in a very significant competitive advantage.

Calculating export price

Export prices are generally calculated using actual price data. Adjustments are, however, frequently necessary where, for example, the importer is associated with the exporter or there is some other form of compensatory arrangement so that the export price paid or used for accounting purposes appears unreliable. In such a case, the export price is constructed on the basis of the price at which the products are first resold to an independent buyer which is then adjusted so as to result in an "at Community frontier" price.

Comparing normal value and export prices

Once normal value and export prices are determined, these prices must be compared with each other. In other words, it must be determined whether the export price is less than the normal value. This allows an investigating authority to determine whether dumping has occurred.

For the purpose of determining whether dumping has occurred, EU authorities have traditionally compared prices on an ex-works basis (i.e. excluding any costs after a product leaves the factory) and exclusive of any indirect taxes. Therefore, in practice, numerous adjustments must be made to sales prices before they can be compared. These include deducting amounts associated with shipping and other after sales costs.

Adjustments to normal value and export prices will also be made to take into account the level of trade (e.g. wholesaler versus retailer), product differences, if any, and any other factors that may affect price comparability.

It should be noted that in a very recent determination concerning China, the EU decided to compare Chinese normal value and export prices inclusive of value added tax ("VAT"). In most situations, VAT is refunded on export. However, in the case where it was decided to compare normal value and export prices on a VAT-inclusive basis, the Chinese authorities did not refund the VAT on that particular product (normally, the reason for such a policy is to curb exports). In a case where the export price is lower than the normal value and assuming the same ad valorem VAT applies to the domestic and exported good, comparing on a VAT-inclusive basis would seem to lead to increased dumping. For example, assume an ex-works normal value of 100, an ex-works export price of 90 and a VAT rate of 20%. Without VAT, the dumping amount is 10. With VAT, the dumping amount is 12 or 120 (100+20% VAT) – 108 (90+20% VAT). Whether this comparison methodology will be used in future cases or is even legal remains to be seen.

Calculating the dumping margin

Under EU law, the dumping margin may be calculated in one of three ways:

(1) Weighted-average to weighted-average method;

(2) Individual transaction to individual transaction method; or

(3) Weighted-average to individual transaction method.

Normally, EU authorities will use the first method. Using this method, the weighted-average price of all export transactions to the EU during an investigation period is compared with a weighted average normal value during the same period. The resulting amount is expressed as a percentage of the CIF export price to arrive at a dumping margin. A simple example is below.

Weighted-average ("WA") dumping margin calculation example

WA normal value (50 EUR)

WA export price (45 EUR)

CIF price (50 EUR)

Dumping margin equals ((50-45)/50)*100 = 10%

c) Some cases

Example 1:

Country initiating the investigation: European Communities (EC)

Product under investigation: Cotton-Type Bed Linen

Countries under investigation: India, Pakistan, Egypt

The complaint was lodged on 30 July 1996 by the Committee of the Cotton and Allied Textile Industries of the European Union, an association of European textile and apparel manufacturers representing in this case a major proportion of Community production of cotton-type bed linen

On 28 November 1997, the Council of the European Union adopted a Regulation imposing a definitive antidumping duty on imports of cotton-type bed linen originating in Egypt, India and Pakistan. At the request of certain exporting producers, which were included in their comments on the

Commission's provisional

Regulation, the Commission agreed to operate certain adjustments to its dumping margin calculations. As a result, certain dumping margins were lowered in comparison to the provisional duties. The definitive individual dumping margin calculated for cooperating exporters ranged between 24,7% and 2,6% for India, 13,5% and 8,7% for Egypt, and 6,7% and 0,1% for Pakistan. It must be noted that four out of seven sampled companies from Pakistan obtained dumping margins which were considered to be de minimis, i.e. below 2%. For such companies, the investigation was terminated and they received a 0% antidumping duty.

Following the publication of the Regulation imposing definitive duties, the Republic of India decided to challenge the validity of the measures through the WTO Dispute Settlement System. According to India, the antidumping measures imposed by the EC were violating several provisions of the WTO Antidumping Agreement. On 12 March 2001 the Dispute Settlement Body (DSB) of the World Trade Organization (WTO) adopted a Panel report -as modified by the subsequent Appellate Body reporton the case _European Communities - anti-dumping duties on imports of cotton-type bed linen from India”.

The ruling of the DSB led the EC to review the ongoing measures applied against imports of bed linen. In particular, the EC rapidly adopted a specific Regulation aiming at giving effect to such DSB rulings and laying down the basis for the EU institutions to repeal, amend or adopt Community measures taken in application of the EC antidumping Regulation, in order to take account legal interpretations made in a report adopted by the DSB26. On the basis of this exceptional Regulation, the EC carried out reviews of the existing measures.

On 5 May 2006, the Council adopted definitive antidumping measures amending the original Regulation. The revised dumping margins for the cooperating sampled exporting producers ranged between 8,5% and 1,3%, which was considered to be de minimis. The residual duty for cooperating exporters not included in the sample was set at the level of the weighted average duty of all companies included in the sample, i.e. 5,8%. The residual duty for non-cooperating exporters was set at the level of the highest

individual duty calculated for the companies included in the sample, i.e. 8,5%.

=> Conclusion:

The bed linen case is a complex case which allows to have an overview of several key aspects of the EC rules and practice in the area of antidumping. These include the use of sampling techniques, the various events which may occur following the imposition of antidumping duties, such as reviews, suspension and termination of measures, as well as some of the technical aspects related to antidumping calculations (treatment of negative dumping margins, construction of normal value in the absence of sufficiently representative domestic sales, etc.).

The bed linen case is also emblematic for its highly sensitive and political background, which included a complete WTO litigation process against the original measures. This illustrates the capacity of WTO Members to act and defend the interests of their industry beyond the administrative phase of an antidumping investigation by formally challenging the measures in the context of the multilateral dispute settlement system.

The bed linen case has proved that the WTO dispute settlement system can be an efficient tool in particular for developing countries to challenge antidumping measures imposed by developed WTO Members in breach of their international commitments. In this regard, the acknowledgement by the DSB of the right of developing countries to an effective special and differential treatment as provided for in Article 15 of the ADA can be seen as a milestone in the concrete enforcement of special and differential treatment provisions available to developing countries.

Example 2

Country initiating the investigation: European Communities (EC)

Product under investigation: Para-cresol

Countries under investigation: People's Republic of China

The complaint was lodged on 13 May 2002 by the English company Degussa Knottingley Ltd, the sole producer in the Community representing 100 % of the Community production of para-cresol

For all other producers which were not granted MET (Market Economy Treatment), the normal value had to be established in accordance with the provision of Article 2(7)(a) of the Basic Regulation, i.e. on the basis of the prices or constructed value of the so called “analogue country”, which is a market economy country.

Since the USA producer’s sales were representative, as domestic sales accounted for more than 5 % of the exports of the product concerned originating in China to the Community and there were no substantial import restrictions, the Commission decided to use the USA as an appropriate analogue country.

It must be noted that, although allowed by China's accession protocol to the WTO, the practice of using an analogue country is somewhat questionable, since very significant differences may exist, in particular in terms of costs, between the market of the targeted country and that of the analogue country. Although the European Commission may operate certain adjustments to the normal value calculated in the analogue country, such adjustments are usually limited to the differences in the technical characteristics of the products between both markets, and do not take into account differences in items such as labor costs, environment costs, etc. However, the differences associated with such elements in a highly developed market (in our case, the USA) and a developing country's market, such as China's, put into question the credibility and the legitimacy of such comparison.

The comparison for non-cooperating producers was based on a comparison of the average export price of the two Chinese cooperating producers with the normal value calculated for the US producer. The European Commission determined that the dumping margin for non-cooperating producers was 40,7%, and for the two cooperating producers were 10,8% and 12,34% respectively, expressed as a percentage of the CIF Community frontier price, duty unpaid.

The producer submitted on 14 December 2003, before the European Court of First Instance, an application, on the basis of article 230 of the EU

Treaty, for the annulment of Council Regulation (EC) No 1656/2003 of 11 September 2003 imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of para-cresol originating in the People's Republic of China

Six months after the publication of the judgment of the Court, the Commission published a notice concerning the antidumping measures on imports of para-cresol originating in China stating that due to the Court's ruling, the definitive antidumping duties paid pursuant to the above-mentioned regulation on imports of para-cresol, including the provisional duties definitively collected in accordance with Article 2 of the regulation, should be reimbursed. It must be noted that the possibility of reimbursement opened by the notice was limited to the imports from the particular producer that obtained the annulment of the Regulation. The reimbursement should be requested from national customs authorities in accordance with the applicable Community customs legislation.

As a consequence of the judgment, the relevant producer is no longer subject to the anti-dumping measures imposed by Regulation (EC) No 1656/2003 of 11 September 2003.

=> Conclusion:

The para-cresol case is a very interesting case since it highlights some of the key problems faced by exporting producers in countries which are considered by the European Commission as non-market economies for the purpose of antidumping investigations (such as China and Vietnam). It also underlines some very interesting issues concerning the construction of a normal value.

In particular, the case shows that even when exporting producers can be granted MET, the determination of the normal value can be a difficult issue which, when not executed properly, can lead to significantly distorted results to the detriment of the exporting producer. The case highlights the importance for exporting producers to remain vigilant towards the calculation operated by the investigating authority, and to have accounting records which are properly kept and allow for a clear identification of all costs items included in (or deducted from) the cost of production of the product under investigation.

II Vietnam and Anti Dumping:

2.1) Overview:

Over the last decade, Vietnam has achieved remarkable achievements in export development. However, with growing export, Vietnam is also facing an increasing number of anti-dumping cases in various foreign markets, especially after its accession to WTO in 2007.

By May 2008, there have been 28 anti-dumping cases against Vietnamese export, including those initiated by EU (10 cases), US (3 cases), India (3 cases), Turkey (3 cases), Canada (2 cases), Peru (2 cases), South Korea (1 case), Argentina (1 case), Egypt (1 case), Poland (1 case), and Columbia (1 case). Among them, 23 cases have been concluded and 5 are under investigation. Among the 5 cases, one was initiated by the US on uncovered inner-spring; three by India on CD-R, flat yarn of polyester, and fluorescent lamp; and one by Turkey on gas lighter.

By the end of July 2009, Vietnam had faced 39 anti-dumping lawsuits, while it had lost in 70 percent of the cases. Vietnam now ranks 7th among the 100 countries sued the most.

 

Vietnam’s exports are relying heavily on some markets, which may bring risks as production will be severely hurt if there are changes in the export markets.Vietnam ranks 39th in the world in the highest export growth rates. Its Vietnam-made goods could easily become the subject of anti-dumping lawsuits also because the country mainly exports raw materials and products which do not go through much processing, and thus always have low prices.

Secctor:

Export items under anti-dumping investigations are vital to Vietnam’sexport, such as shrimp, fish, footwear, and other industrial products. In many cases,

anti-dumping cases against Vietnam are filed together with those against a number ofother Asian countries such as China, Thailand, and India..

Trend

Nguyen Thi Thu Trang, member of the Trade Remedies Council of Vietnam Chamber of Vietnam may face anti-dumping suits in the future due to its export-dependent economy.“One thing worries me - although Vietnam didn’t face as many anti-dumping suits as other countries, the rate is slowing in other nations, while legal action against Vietnam is increasing,” she said. Koenig suggested Vietnamese exporters learn about their importing markets’ trade protection histories. The US often files legal action against products like steel pipe, furniture, tra and basa catfish, nails and screws. The garment industry is vulnerable to anti-dumping suits too. Anti-dumping suits increased 30 percent last year, but a sharp decrease in the fourth quarter as the economic crisis slowed worldwide trade.Legal action - including anti-dumping, anti-subsidy and safeguard suits - against Vietnamese products set a record last year. Seven trade protection cases were filed in six markets, including Brazil, Canada, the US, India and Turkey. Already this year, anti-dumping and anti-subsidy suits have been brought against Vietnam’s PE bags. Vietnam launched its first dispute this year at WTO over US frozen shrimp dutiesCommerce and Industry, said.

Anti-dumping cases against Vietnam exports are expected to increase, following her WTO accession. In 2007, there were considerations for anti-dumping investigations and anti-dumping measures on Vietnam’s export of 6 products and formal complains on three 3 products (CD-R, fluorescent lamp, and gas lighter) were eventually launched. In January 2008, an anti-dumping investigation request was submitted by the American Association of Producers to the International Trade Center and the Department of Commerce in the US against imports of uncovered inner-spring from

Vietnam. Vietnam exports of flat yarn of polyester were also under anti-dumping investigation in India. Vietnam’s exports to Europe have experienced difficulties since European Committee (EC) decided, in October 2008, to extend the application period of antidumping measure on leather footwear imported from Vietnam and China. Consequently, an anti-dumping duty of 10% will continue to be levied on such

imports until the end of the investigation and a review and a final ruling are reached by EC’s Directorate General Trade.

Gorvement’s Reactions:

Vietnam’s ineffective response to anti-dumping challenges. Even before Vietnam joined WTO, the government was already working to enhance Vietnam’s ability to respond to anti-dumping investigations, including improving its legislation, establishing functional organizations, and providing

guidance for the exporters.

In 2004, the Competition Administration Department was established under MOIT to assist in managing competition matters, including anti-dumping, antisubsidy, safeguard, and consumer protection. MOIT also established the Competition Council in 2006 to take charge of investigation process for unfair business practices. However, efforts from the government alone are not sufficient to help Vietnam respond to an increasing number of anti-dumping cases. Exporters are the most import party in these cases as they are affected first and most directly. But how have Vietnamese enterprises coped with anti-dumping cases?

Vietnamese exporters first became aware of anti-dumping issues when antidumping complaints were filed against Vietnam’s rice export to Columbia; they have since experienced and learnt from numerous anti-dumping cases from various countries.

Non_ Market Argument:

Classified as a NME, Vietnam has been facing considerable disadvantages. Its NME status was given for the first time when the US decided to apply anti-dumping duties on catfish imported from Vietnam in 2002. Since then, antidumping investigations by EU, Canada, and Korea against imports of footwear, gas-lighters, etc. from Vietnam have all used Vietnam’s NME status to reach unfavorable rulings for Vietnam. Such rulings have inevitably hindered Vietnam’s exports. The problem is likely to get worse now that Vietnam is a WTO member, as Vietnam is encountering more anti-dumping challenges.

High anti-dumping duties are levied on Vietnam exports following the rulings. As a NME, domestic prices in Vietnam are not used in the anti-dumping investigations. Instead, the import countries use comparable prices in a third country, such as India and Mexico, to determine whether dumping occurred from Vietnam’s export. It is not clear whether such prices are indeed comparable to Vietnam. Anti-dumping duties resulted in huge losses to Vietnam’s exporters and, in some cases, the closing down of businesses and the shrinking of industries. Business closures and industry contractions may further cause social problems such as rising unemployment, decreasing living standards, and increasing poverty.

Increasingly, the NME status seems unfounded and inconsistent with WTO’s non-discriminatory principles. Unfavorable rulings against countries with NME status place them at a very disadvantageous position when they are subject to anti-dumping investigations. Vietnam’s WTO accession commitments specify a maximum duration of 12 years for its NME status. Vietnam has the option to request for a reclassification as a ME before its 12-year term by providing sufficient evidences. There are opportunities for some sectors to apply for ME status even though Vietnam as a whole is still considered a NME.

2.1) Anti Dumping summary:

As shown in Appendix Table 1, a considerable number of anti-dumping investigations have resulted in anti-dumping duties against Vietnamese

exports; while in some cases, no anti-dumping duties were levied due to the lack of evidence of material injury to domestic industries.

( The following cases were concluded without imposing anti-dumping duties, including rice export to Columbia, footwear export to

EU, export of water-proof footwear and sole to Canada, and export of fabric footwear to Peru.)

.

From late 2008 to 2010

Waterproof Rubber Footwear

This was the case initiated by Canada on February 27, 2009; relating to Vietnam.

On May 28, 2009, Canada imposed the provisional anti-dumping duty ranging from 16% to 49%.

On September 25, 2009 The Canadian International Trade Tribunal found no injury to the domestic industry caused from Vietnam's waterproof footwear. 

The case terminated without any anti-dumping duty.

Polyethylene Retail Carrier Bags

This was the case initiated by the United States on April 21, 2009.

On Octorber 28, 2009 The US Department of Commerce announced the provisional anti-dumping duty ranging from 52.30% to 76.11%.

On March 26, 2010 the US Department of Commerce announced its affirmative final determination on the final dumping margins

On April 15,2010 the US International Trade Commission determined that US industry is threatened with material injury by the subsidized and dumping imports from Vietnam.

Air conditioners

This were the case initiated by Turkey on July 25, 2009 and by Argentina on February 16, 2010.

2.3) Typical Case study:

a) Catfish:

In 2001, American catfish farmers, who were severely subject to competition by Vietnamese producers, launched a successful campaign at the state and federal levels for legislations to ban the later from using the name of “catfish” for their products.

The imports of Vietnamese catfish, which is cheaper than those from the Southeast of America has increased from 0.6 million pounds in 199837 to 26 million pounds in 2001.38 The Bilateral Trade Agreement between Vietnam and the United States came into effect on December 10, 2001 with the elimination of tariff on Vietnamese catfish, have presumably contributed to a dramatic increase of import volume39 from 12.5 million pounds in 2000 to 26 million pounds in 2001.40 In 2001, the price for U.S. fish have dropped to as low as 50 cents a pound, about 15 cents below the cost of production and about 30 cents below the price in 2000.41

In 2001, CFA launched an USD 500,000-funded attack on the imported catfish which aimed at three factors: (i) sanitary conditions of Vietnamese catfish, (ii) the matter of species, and (iii) unfair competition of Vietnamese farmers exploiting a market developed at the American farmers’ expenses.

With respect to the sanitary matter, an advertisement by CFA said that "Never trust a catfish with a foreign accent…[t]hey've grown up flapping around in third world rivers and dining on whatever they can get their fins on". Representative Marion Berry of Arkansas, one of the three leading states producing catfish, even went further by offering a novel idea that Vietnamese fish are contaminated by the defoliant Agent Orange, which was sprayed by the

Antidumping action against Vietnamese “tra” and “basa”

Facts

Despite the fight over labeling, the import volume of Vietnamese “tra” and “basa” (Vietnamese catfish) in 2002 still reached 36 million pounds, much higher that of 2001 (26 million pounds)53. The increasing rate of imports from 2000 to 2002 is 187.4 percent and the increasing rate of import value is 127.5 percent.54 On June 28, 2002, CFA and a number of individual U.S. catfish processors (hereinafter the “Petitioners”) filed a petition to ITC and DOC alleging that U.S. catfish industry was materially injured and threatened with material injury by reason of less-than-fair-value (LTFV) imports of certain frozen fish fillets from Vietnam. On July 24, 2002, DOC announced the initiation of AD investigation on Federal Register (67 FR 48437). DOC issued its preliminary affirmative antidumping duty and critical circumstances determinations on January 31, 2003 (68 FR 4986). The determinations of antidumping duty and critical circumstances were amended on March 5 and May 28, 2003. ITC had its hearing on June 17, 2003. DOC had its final determinations on antidumping duty and critical circumstances on June 23, 2003 (68 FR 37116). Final dumping margins and critical circumstances determinations of DOC as follows:

Every year, the DOC conducts an administrative review of named exporters, which decides appropriate tax rates for the companies.

Year US Antidumping Actions

Vietnam Actions

Provisional Measures

Definitive Measures

2001 DOC restricted the name “catfish”, denying tra and basa fish from using the brand “catfish” in US market

had to register their two main expor ted fish

species as “basa fish” and “tra fish”

Exports continued rising

2002 -US farmers suited VN for dumping price

- July, DOC announced the initiation of AD investigation on

(VASEP) Hired the White & Case Law Corporation of the US to represent

them in the case

Federal Register

- Sep, DOC delegation traveled to Vietnam to investigate the

dumping allegation

- DOC proposed that India be used as the reference country to assess a new tariff rate for Vietnamese products, and

that the proposed tariff hike could be as high as 191 percent

decided to work with four biggest Vietnamese processing and exporting enterprises -

namely

The Vietnamese Government and

enterprises pointed out that Vietnam’s status as a market economy was one of the prerequisites

of the Bilateral Trade Agreement (BTA)

- Recommended that Bangladesh be selected for reference as it is more relevant

2003 - DOC issued its 66.34 per

preliminary affirmative antidumping duty and critical circumstances determinations

- Mar 5 and May 28, the determinations were amended

June 23, final determinations on antidumping duty and critical circumstances

- from August 6 apply the new tariffs

cent.

2004 - August, US DoC to Rethink Tax Rates for Vietnamese Catfish Exporters

Some Vietnamese exporters working on procedures to apply for lower import tariffs

4.3% and 25.76%

2005 - August, US farmers request for closer scrutiny by the US' Catfish Farmers of America (CFA)

2006 - May 5, DOC announced tax reductions on tra and basa catfish

- Jul, DOC announced its final determinations in the scope and

Mekong Delta Dong Thap-based Vinh Hoan Ltd. Co. will receive reductions from 36.84% to 6.81%

circumvention

inquiries of the antidumping

2007 - On August 31, The Association of Catfish Farmers of America (CFA) and US catfish processors have removed the names of 27 Vietnamese tra and basa exporters from the list of companies subject to the fourth administrative review ( 2006-2007)

44.55 %(QVD)

14.59%

80.88 %(CATACO)

2008 - Aug, DOC decided to exempt three Vietnamese tra catfish export and processing companies from anti-dumping tariffs.

East Sea Seafoods Joint Venture Co Ltd (ESS), QVD Dong Thap Food Limited Company (QVD Food Co) and Anvifish Co Ltd.

2009 - Feb 2, DOC decided not to revoke its imposition of antidumping duty on certain catfish products imported from Vietnam

The Ministry of Industry and Trade (MoIT) has issued a statement voicing its strong opposition

- Jul, DOC selected the Philippines as a surrogate country to calculate the anti-dumping tariffs

- September 15, the US Department of Commerce (DOC) made a preliminary decision on imposing an increase of up to 136 per cent in anti-dumping tariffs

against the US International Trade Commission (ITC)’s decision to continue imposing anti-dumping duties on imports of Vietnamese tra and basa catfish for another five-years.

2010 - The frozen fillets of four tra catfish exporters have been declared anti-dumping-tax exempt after the US Commerce Department's fifth administrative review of imports (August 1, 2007 and July 31, 2008.)

-

officially filed a complaint at the WTO early this year

VASEP is working with its lawyers to prepare arguments and evidence to submit to the DOC in October and will attend hearing in November.

Nov, The Việt Nam Fisheries Association

26.84

zero-percent tax rate to Bianfisco to 2012

(VFA) has issued a notice requiring (CFA) and concerned individuals to stop unfair trade competitions and anti-dumping tariffs on Việt Nam’s catfish farming industry.

  Vietnamese exporters remain optimistic about doing business in other markets, including Russia, Spain and Egypt, according to the Viet Nam Association of Seafood Export Producers. Vietnamese exporters have already expanded their export markets to some African countries, Brazil and Mexico.

 

  The EU remains one of the biggest export markets for tra catfish, accounting for half the countries export value, according to the association. Vietnamese catfish is exported to 128 countries in the world.

b) Shrimp:

Facts

In the last decade, shrimp has become one of the most popular seafood in the United States. U.S. consumption of shrimp increased steadily at an average annual growth rate of 4.0 percent. In 2003, U.S. annual per capita consumption of shrimp (all preparations) reached a record of 4.0 pounds81. In 2003, U.S. consumption of shrimp reached 1,211 million pounds of which 1,066 million pounds was imported.82

The U.S. shrimp industry is mostly based on harvesting with the shrimp fleet is composed of thousands vessels in the Mexican Gulf and South Atlantic coasts. The estimated U.S. commercial landings of warmwater shrimp totaled 276.9 million pounds83. A small but growing percentage of U.S. domestic production of warmwater shrimp is produced by aquaculture (i.e., farm-raised)84. In 2003, U.S. production of farm-raised shrimp was estimated to be 13.4 million pounds (about 4.5 percent of U.S. production of warmwater shrimp).85

The total of shrimp imports steadily increased between 2001 and 2003 (from 852 million pounds to 1,066 million pounds).86 Shrimp prices decreased from $ 3 to $ 1.85 per pound during the period between 2001 and 200387.

In response, the U.S. Shrimp Trade Action Committee (STAC), an ad hoc representative of the U.S. Southern Shrimp Alliance (SSA), filed a petition for an anti-dumping investigation with the DOC on December 31, 2003. The respodents in this case were shrimp producers from Brazil, China, Ecuador, India, Thailand, and Vietnam. On July 16, 2004, the DOC announced its preliminary determination of sales less than fair value of frozen and canned warm-water shrimp from China and Vietnam.

On September 1, 2004, the DOC amended the preliminary determination on July 16, 2004. On November 5, 2004, the DOC held a public hearing on issues concerning financial ratios, surrogate values, and the Mandatory Respondent. On November 29, 2004, the DOC had final determination for Vietnam and China.

Early warning

VASEP had been aware of an impending antidumping case for a long time before the STAC filed its antidumping petition to the DOC. On January 20, 2003, Mr. Ngo Phuoc Hau, Vice President of VASEP informed Lao Dong [Labor] Newspaper that VASEP had already prepared for an antidumping action against its shrimp exported to America. In comparison with the catfish case, Vietnamese respondents had much more time to prepare for the DOC’s investigation. It is clearly that VASEP has learned a lot from experience in the catfish case. The association had understood the importance of early warnings during the preparation period for an investigation. Therefore,

VASEP has developed an early warning mechanism which compises several elements:

monitoring the preparation activities of American shrimp producers,

analysis of the U.S. shrimp industry and the trends of shrimp importation to the U.S.

a network of connections with international trade law firms and lobbying companies. The mechanism proved to be a success, Vietnamese respondents had almost two years to prepare for the case.

What’s new?

The US Department of Commerce (DoC) has announced final results into the fourth administrative review of Vietnamese shrimp exported to the United States for the period from February 1, 2008 through January 31, 2009.

- According to the final results, only one Vietnamese shrimp exporter enjoyed an antidumping duty reduction, while the remaining companies were ordered to pay higher duties compared to the preliminary results announced in March.- One of the two compulsory defendants in the antidumping lawsuit, the Minh Phu Seafood Co., will pay a lower duty, from 3.27 per cent to 2.96 per cent, while the second, the Nha Trang Seafood Joint Stock Co. will have its tariff increased to 5.58 per cent from 2.5 per cent.- Vietnamese companies are subject to higher duties than Indian exporters. The highest duty imposed on an Indian company is 4.44 per cent, while the rate for Vietnamese is 5.58 per cent. Other Indian companies pay lower duties than Vietnamese exporters, at only 2.67 per cent.- In April, Vietnam asked the World Trade Organisation (WTO) Dispute Settlement Body to set up a panel to review US antidumping measures imposed on frozen warm water shrimp from Vietnam.Recently, WTO General Director Pascal Lamy has appointed three members to the panel. Normally, after six months, the panel board will make its final report on the lawsuit for concerned parties.This is the first time Vietnam has launched a trade lawsuit since against a WTO member it joined the WTO in January 2007.

2.4) Effects and Lessons

a) Effects:

While anti-dumping duties may not lead to immediate bankruptcy of Vietnamese exporters, it has an adverse impact on their price competitiveness and profitability. Anti-dumping lawsuits also affect negatively other businesses associated with the exporters, including their suppliers and buyers. More broadly, anti-dumping lawsuits could potentially reduce the inflow of foreign investment into Vietnam,

especially those intended to set up export-oriented factories.

A case study on EU’s anti-dumping duty levied against footwear import from Vietnam from 2006 to 2008 found that the impact on Vietnam’s footwear industry was large. A total of 500,000 workers in Vietnam were affected in various aspects (such as lower income and possibly job losses of 70,000 to 90,000). Vietnam’s export of leather footwear to EU decreased considerably, from 106 million pairs in 2000 to 90 million pairs in 2006 and further to only 60 million pairs in 2007.

b) Lesson:

In particular, Vietnamese enterprises learnt a great lesson from the antidumping lawsuit against Vietnam’s catfish exports to the US in 2002. It shows that Vietnam enterprises can learn from such adversities if they respond promptly and actively. In that particular case, many catfish processing enterprises had subsequently diversified their products and expanded their network in domestic market. Since the lawsuit, the number of catfish processing enterprises in Vietnam had increased to 30 factories, and their capacities doubled. They quickly expanded to new export markets including China, Hong Kong SAR, Singapore, Canada, and especially EU. The total output doubled in one year and further increased seven-fold over the next four years. Vietnamese catfish businesses extended their exports to 65 countries, compared with 17 countries before the lawsuit. However, only a small number of enterprises have experience in anti-dumping matters. The large majority of Vietnamese exporters continue to have difficulties with anti-dumping lawsuits, for various reasons.

Firstly, most enterprises lack knowledge and experiences in dealing with antidumping and anti-dumping duties. They have not recognized the importance of responding actively in such lawsuits to defend and to protect their business interests. During the investigations, domestic companies do not know how to convince the other parties that they are operating under market economy conditions.

Secondly, the accounting method of Vietnam enterprises needs to be improved. In many Vietnamese enterprises, the accounting reports are not consistent with international standards. As a result, they are not able to provide sufficient and convincing data requested by foreign investigation agencies.

Thirdly, Vietnamese enterprises are constrained by financial resources to follow up with the lawsuits. According to a survey conducted by the Vietnam Chamber of Commerce and Industry, 72% of Vietnamese enterprises face financial difficulty pursuing their legal defense in anti-dumping lawsuits. A lack of human resource is another factor. The costs of fighting anti-dumping charges are often too

high for the firms to commit themselves in the cases.

Vietnam’s accession to the WTO in 2008 presented it with both great potential and challenges, including anti-dumping disputes, in Vietnam’s export promotion. To assist enterprises to avoid potential trade disputes and to defend their business interest in legal battles, VCCI set up a Trade Remedies Council (TRC) in 2008. Government agencies, together with VCCI and industrial associations, are working to provide trade related information to enterprises, especially with respect to anti-dumping regulations, through seminars, workshops, and conferences. These have helped the enterprises to acquire some basic knowledge of anti-dumping matters. One major problem, however, is that Vietnam continues to be considered a non-market economy in her WTO accession agreement. Therefore, when Vietnamese producers cannot convincingly demonstrate that they are operating under market economy conditions (with respect to production and sale), the importing party can use the price and cost of the product in a third economy to determine whether dumping has occurred. This has been the single most important disadvantage for Vietnamese exporters in fighting against anti-dumping

charges. In the WTO agreement, Vietnam accepts the designation as a non-market economy (NME) for up to 12 years after accession, or until it is able to meet the criteria for a market economy. The interesting issue is in the definition of a nonmarket economy and in the way it affects Vietnam’s response to anti-dumping charges.

C. THE SOLUTION TO THE VIETNAM BUSINESS THROUGH ANTI-DUMPING BARRIERS IN IMPORTING COUNTRIES.

I. Solutions to prevent from being sued

1.1) Government level:

The Government actively promoted the propaganda and popularization campaign for manufacturers, exporters of Vietnam on Vietnamese and International law, about the rules and practices of the International trade practices, as well as the important domestic laws of the foreign market useful for Viet Nam enterprises having more knowledge to protect themselves.

Government actively participate in official bilateral and multilateral negotiations to persuade more countries admit Vietnam as a market economy country, so they do not apply anti-dumping method against Vietnam.

Warning regularly the list of sectors and items of Vietnam economy is in threat of dumping lawsuit. On the basis of reviewing the situation of production and export of each sector and anti-dumping redulations of each country, and then proposing solution if necessary .

In the international trade agreement, Vietnam also needs to have acceptable agreements about safeguard measures, governmental subsidies and paticularly antidumping, on the basis of standard international trade in order to avoid partners being free to unilaterally apply their laws.

1.2) Enterprises level

2.1Measure 1 : Formulating diversification campaign into export markets and export commodities. This solution mainly applyto businesses large and

medium exporters. How to proceed as follows:Enterprises should develop major export markets,however, revenue in this market is abot 50-60% ot the total export turnover. At the same time, enterprises have to split the share of exports, disperse risks to other market, that has them create the ability to regulate increase or decrease export activity in each market and prevent enterprises from not finding a new market during a long anti-dumping lawsuit.

Enterprises should export diversified goods, focus on unique items,branded, unique design and style and legal protection of intellectual property rights.

Enhancement the application of non-price competition measures - improving product quality, promote the sales service, marketing ads... instead of competing on low prices.

In addition, enterprises should strengthen exploitation the domestic market - a potential market .

Measure 2: Enterprises should first research the barriers trade before penetrating a new market.

Besides, enterprises should focus on the study of free trade agreements of multilateral and bilateral,and use of legal advisory services to avoid unnecessary trouble.

"Companies should use addictive legal advice right from the start of negotiations until contracting with partners, conducting contracts and disputing, so we have a legal reason to fight the lawsuit, "said Phan The Rue-Former Minister of Commerce said.

Mesure 3: Participating actively in constructing and strengthening the activities of business associations.

Enterprises must be aware of business associations is that:

Being responsible for regulating flow of goods into the importer to avoid excessive growth in each good on an import market.

Protecting the interests of export enterprises when sued or were about to anti-dumping lawsuits.

Supporting and exchanging market development experience of developing market, dealing with commercial litigation, including lawsuits against dumping of exports.

Currently, the role of bussiness associations in our country is still very faint, internal discord, the level of leadership is weak, many businesses have not appreciate sector union households. Therefore, we have not conducted the case against dumping of any imported as a plaintiff, we lose the means used to "retaliate", "resistance" when it exports about to be sued.

Measure 4: Enterprises should actively prevent the risk of being sued in the export market, based on early warning systems of anti-dumping proceedings built by the Competition Administration Department, Ministry of Industry and Commerce.

II. Solutions when being sued:

2.1) Government level:

Government should not intervene directly in the lawsuit but they should support actively enterprises in the appeal.

Lobbying and establishing the fund for financial assistance to enterprises that pursue lawsuits and appeal.

Providing the necessary information about the appeal procedure, introducing good lawyers in the host country's who have ability to help enterprises win in lawsuits.

Business accosiations level:

Promote the role of business associations, organizations, gathering and strengthening the cooperation between enterprises in order to improve the ability of enterprises appealing.

Establishing a great coordination between the participants in lawsuits and sharing beneficiaries when appeal successfully to encourage businesses to participate in appeal.

2.2) Enterprises level:

Measure 1: The exporter should have the right attitude when they are sued in Anti- dumping lawsuits.

Enterprises must consider the phenomenon of dumping lawsuits in the importing country is normal, not only strengthen exporting but also deal positively with lawsuits.

Enterprises should actively participate in the proceedings, otherwise the ability to lose very high. If we lose in a lawsuit , we will be subject to anti-dumping tax rate the highest.

In addition, Vietnam has not been considered market economy by WTO, but the enterprises as the defendants tried to demonstrate that:

Businesses operate independently without the intervention of the State: business strategy, management appointment ... .

Enterprises do not receive any subsidies by the Government such as tax, preferential interest rates, capital allowances ...

Measure 2: Completing accounting regime and records system in company according to international standard.

Storaging full archive records of the business situation to prepare the evidence and arguments to prove not to dumping in import country.

Preparing staff, budget, building plans of protecting the interests of the business.

Measure 3: Close cooperation with importer to response against the lawsuit.

When Vietnam exporters sued and lost the case, the importer is also damaged: lost of imported power, lost partnerships and related constraints. Therefore, the exporter must contact a foreign partner to clarify the following:

Number of businesses represented petitioner at least 25% of the volume produced in the importing country does not? And some manufacturers in the lawsuit may constitute at least 50% of the mass production?

Compared with other competitors our export good are now dumping or not? If it has the phenomenon of selling low prices, enterprises should review it is

in the allowed dumping margin or not? Are there relationship between the low selling price of Vietnam goods with the

loss of manufacturers and industries in the importing country?

Measure 4: Creating link to coordinate and lobby to persuade consumers, concerned parties support canceling lawsuits.

Ex:  As in the case of shrimp was " Consuming Industries Trade Action Coalition" (CITAC), " Association of seafood distribution America " (ASDA) supported the Viet Nam enterprises against Vietnam dumping lawsuit in the U.S.

Measure 5: Using legal advice

When sued, enterprises should use legal consulting at all procedures of the involved appeal process. Such as: when answering the questionnaire of the anti-dumping investigation on, when arranging accounting system for a formal investigation, when in contact with the investigating agencies by importer send.

Notes: When participating in a proceeding in a foreign place, they must use legal consulting in importer.

Measure 6:Cooperating fully and promptly and goodwill with anti-dumping investigation agencies

Do all the work required during the investigation:

Answer questionare fully . Providing sufficient information and documents. Thorough explanation to the experts of anti-dumping investigation.. Presenting fully in the session convened meeting.

For example in PE cases were exported to the U.S. in anti-dumping investigation, said Mr. Vu Ba Phu, among three companies under investigation are two of the foreign company and a company in Vietnam. From the beginning, Tien Thinh Co., Vietnam's own proposals were classified as volunteers, work closely with lawyers. Two foreign companies coordination remains idle, even proactive move factories to other countries. The survey results published from the United States, Tien Thinh Co. close cooperation with the investigation should have low taxes, only 0.44%. Under the provisions of the anti-subsidy investigation, the tax rate is nearly equal to 0. Other companies subject to high tariffs, up to 52% ...

Measure 7: Export enterprises are actively recommended anti-dumping investigation (applies to the export business is not in the group are mandatory).

If exporting enterprises have realized that they prepared fully the conditions to deal with lawsuits (documentation, answer questions, have enough manpower for the investigation ... ..), they should proposal to be investigated to clarify them are dumped on the market or importing country. Benefit from this measure are enjoyed by enterprises of anti-dumping tariffs and the distinct low, and will keep the market. 

Practical case in Vietnam's shrimp export market on the U.S: +4 Mandatory application cows did not answer questions better beef DOC 25.76% tax rate applies. +3 Cows application requires a good answer, AD pressured tax rate: 4.13%, 4.21% and 4.99%. + These cows are entitled applicant voluntarily tax rate is 4.38%. + Other Businesses not participating investigator pressured tax rate 25.76% (approximately 54 businesses). 

Measure 8: Actively negotiating implementation of commitments prices with the import government if the business actually acts of dumping, causing damage to businesses and industries of the importing country.

Commitment to price means the producer, exporter commit to change price (increasing prices) or to stop exporting the product its price is considered dumping . This is a voluntary agreement between manufacturers, exporters and importers. When a commitment to price is aaccepted, investigation process will be terminated. Currently, the price is considered to be committed to a proactive response of exporters in anti-dumping lawsuits, especially for industrial products. Commitment to price has the advantage of faster and less expensive than having to complete the investigation of the dumping investigation.

Moreover, manufacturers, exporters sued will enjoy the difference before and after commitment of increasing the price instead of subjecting to anti-dumping tax by importing countries.

However, exporters also face a reduction advantage in competing on price exports, accept the implementation of stringent administrative procedures and more complex transactions for export.

Therefore, enterprises should consider carefully about economic, social, legal, competitive factors ... before implementing this measure.

III. Solution to reduce damage when losing in the lawsuit:

When losing in the lawsuit, being imposed high taxes ,firms need to choose these solutions to maintain the development of export:

Measure 1: Continue to keep the market consistently in the plaintiff country:

+ change the production into the commodities which are not imposed antidumping tariffs : for example, in the EU market,just only leathered shoes face with AD taxes, Businesses should produce shoes to export may increase in other types of shoes: shoes sport, boots, children sneaker... building strategies to develop new export products to get high profit

+ continuing appeal to get consideration on AD tariffs:

Most countries have time to apply AD tax is 5 years, prior to this period , Aintidumping investigate instituite in plaintiff country will conduct the investigation, whether decide to impose aintidumping tax.

However,after each year, if plaintiff or defendant have recommendation,investigate institute will re-adjust the antidumping taxes.In this case,if the exporter have enough information,documents, they will have ability to calculate the reduction of AD tariff margin ,so that they can get the lower antidumping taxes.

To re-appeal ,exporter have to complete the accounting system ,aswer transparently the question asked by the investigator.

The benefits of solutions:- Helping export business still remain market when losing.- To get more experience dealing against international antidumping case.

Measure 2: Sue the Importer to the WTO’s dispute settlement agency1. :WTO’s dispute settlement agency works very effective,on the other

hand, Viet Nam has become WTO’s member since 01/2007 so that when the firms figure out the unfair in the imposing AD taxes, export firms need to sue the import country to WTO with the support of ministry of commerce and industryTo carry out the measure 2, export firms have to:_ give the evidence that the AD tariffs on their goods are unfair_ hiring excellent lawyer_ Businesses exporter must solidarity with each other in every industry associations to support each other to do well legal proceedings at the WTO.