CHAPTER 2: THE ANTI - DUMPING CASE FRAMEWORK
2.2. Anti - dumping cases between the US and Viet Nam
2.2.2. The frozen warm - water shrimp case
06/08/2003: The Louisiana Shrimp Association voted to file a petition against imported shrimp.
08/08/2003: The South American Shrimp Alliance (SSA) voted to approve a resolution to sue dumping imported shrimp from six countries, including Vietnam.
(Brazil, China, Vietnam, Thailand, Ecuador, India.)
31/12/2003: SSA officially submitted a petition form against "shrimp anti - dumping"
to DOC and ITC for shrimp exporters to the US market from some countries, including Vietnamese enterprises.
2.2.2.2. The process of Anti - dumping investigation a. Initiation
20/01/2004, DOC began investigating Vietnam's dumping lawsuit in the United States. All types of exported shrimp (including: frozen and canned warm-water shrimp from Vietnam were within the scope of the investigation, except for dried shrimp and flour shrimp.
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At the same time, DOC informed ITC about that DOC was conducting the anti - dumping investigation.
b. ITC Preliminary Determination ITC Hearing:
21/01/2004, ITC held a public hearing in Washington D.C. Representatives from 6 countries sued for dumping shrimp attend this hearing, including Vietnam.
Preliminary conclusion:
17/02/2004, ITC had a voting session for the results for the first investigation and they concluded preliminary of the shrimp dumping case on the US market with Vietnamese enterprises that importing shrimp from Vietnam into the US market made seriously harm to the domestic industry.
The lawsuit began at the investigation stage.
c. DOC preliminary determination
DOC Investigates dumping status – Questionnaire:
Divide the defendants:
23/02/2004, DOC selected a number of companies to begin conducting investigations.
26/02/2004, DOC published a list of four Vietnamese defendants on shrimp lawsuits.
They are: Ca Mau Seafood Processing and import-export company (Camiex), Minh Phu Seafood Processing Enterprise (Ca Mau), Minh Hai Seafood processing JSC (Seaprodex Minh Hai) and Kim Anh Co.Ltd. (Soc Trang).
Moreover, there were also voluntary defendants expecting to take part in the investigation process) and the other defendants who didn't participate in the investigation process).
DOC has asked four mandatory defendants (Minh Phu, Kim Anh, Minh Hai, and Camimex) to respond a questionnaire about the company's financial and cost issues relating to exporting shrimp to the US.
01/04/2004, The Consuming Industries Trade Action Coalition (CITAC) and the The American Seafood Distributors Association (ASDA) formally established the Shrimp
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Task Force to mobilize with campaigning against the dumping lawsuit that the South American Shrimp Alliance (SSA) submited a lawsuit against imported shrimp from six South American and Asian countries, including Vietnam.
06/07/2004, DOC conducted a dumping investigation over about 30 Vietnamese companies including 4 mandatory defendants and 29 voluntary defendants.
Antidumping duties are planned at 3 levels:
- Mandatory defendants: from 12% to nearly 20% (included 4 companies).
- Voluntary defendants: duties rate is about 16%.
- Other defendants: duties rate is 93%
(Sources: VCCI, Viet Nam)
d. ITC and DOC Final Decision
31/01/2005, ITC and DOC announced the final ruling: the import of shrimp from Vietnam into the US market seriously made the injury to the domestic industry of the United States.
Imposing Anti - dumping duties order
The US anti - dumping duty order was effective from February 1, 2004. DOC asked for the US Customs to officially impose anti - dumping duties rate following the final decision of DOC on January 26, 2005, for Vietnamese enterprises. Simultaneously, DOC also stipulated that anti - dumping duties would apply to unpaid imported shrimp shipments into or out of warehouses for consumption on or after July 16, 2004.
In February 2005, DOC officially applied anti - dumping duties with the following rates through using Zeroing way:
+) 4.3% to 5.24% for each mandatory defendant;
+) 4.57% (which is the weighted average of the tax rates applicable to 4 mandatory defendants) for voluntary defendants.
+) And the national tax rate of 25.76% for all remaining businesses.
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According to the US anti - dumping law, after every year since imposing the anti - dumping duty, DOC will conduct an administrative review to review the official tax rate that DOC has applied to the period of the previous 1 year. Accordingly, in February 2010, DOC has conducted three administrative reviews (POR).
On POR 1, Vietnamese enterprises actively agreeded not to request a review but still applied the AD duties rate of the anti - dumping result for the first time and would pay the US a sum of money instead of to have more time to prepare for the second phase review.
In the second round of review - POR2 (April 2007), about 30 Vietnamese shrimp exporters have registered to participate in the review. However, DOC only selected 2 enterprises (Minh Phu and Camimex) as mandatory defendants based on the criteria that enterprises have the largest export volume. Accordingly, the tax rates of mandatory defendants (Minh Phu and Camimex) were insignificant (0-0.01%). The remaining 28 businesses are subject to a tax rate of 4.57%, the country-wide rate for all enterprises not participating in the review was 25.76%.
In the third round of review - POR3 (April 2008), there were 28 enterprises registered to review, DOC has chosen 3 enterprises to be defendants: Minh Phu Company, Camimex, and Phuong Na Company. On September 15, 2009, the final decision on the review of POR3 results was issued, 3 mandatory defendants all received the minimum tax rate (Minh Phu: 0.43%; Camimex: 0.08%, Phuong Nam: 0.21%), the tax rate for the remaining 25 enterprises was 4.57%, the country - wide rate was 25.76%.
In front of the risk of DOC continuing to use calculation methods as used in POR2 and POR3, resulting in very unfavorable results in POR4, Vietnam Association of Seafood Exporters and Processors (VASEP) and Vietnam Chamber of Commerce and Industry (VCCI) have proactively provided analysis and recommendations to the Government to sue the United States in the WTO. In February 2010, the Government approved this proposal and started the lawsuit by consulting to the US Government.
After a long investigation, 11/07/2011, the World Trade Organization (WTO) issued a final decision that the United States had violated the provisions of the Anti - dumping
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Agreement and the GATT 1994 of WTO and this has undermined Vietnam's rights following these Agreements.
The ruling of the WTO Panel stated that the US applies the zeroing method to calculate anti - dumping duty is a violation of WTO rules. This is a main complaint of Vietnam because the use of this method has created a large dumping margin for products, caused the duty rate to be raised and caused the injury to Vietnam's shrimp exporting enterprises. Therefore, the Panel recommended that the United States should adjust the relevant measures in accordance with the above Agreements. Under WTO rules, after this decision of the Panel, the two parties have a 60-day timeline to appeal to the WTO.
In the latest review of POR 13, DOC announced 31 companies and factories received 0% anti - dumping duty. However, the preliminary conclusion of POR13 hasn’t still affect on shrimp exports to the US because we still have to wait a few months for DOC to announce the final conclusion.
Thanks to a long time for preparation, various activities have been carried out to improve the capability of Vietnamese respondents in responding to the investigation.
Mistakes and shortcomings revealed in the catfish case were learned. The mechanism to manage the defense was also refined.