Vietnam to challenge US shrimp tariffs

Feb 9, 2010, 6:40 GMT

Hanoi - Vietnam will file suit with the World Trade Organization to challenge the US's imposition of anti-dumping tariffs on Vietnamese shrimp, a government official confirmed Tuesday.

'The US has applied a method of calculating anti-dumping duties that is not suitable with WTO regulations,' said Bach Van Mung, director of the Ministry of Industry and Trade's competitiveness department.

In November 2004, the US imposed tariffs of between 4 and almost 26 per cent on Vietnamese frozen shrimp from different companies. Some companies' tariffs have since been lowered.

Le Van Quang, chairman of the shrimp committee of the Vietnam Association of Seafood Exporters and Producers, said it would challenge the US Department of Commerce's use of a method known as 'zeroing' in assessing whether or not a company is dumping products at below-market rates.

The US method first calculates the market price of a given good in the exporter's home country, and compares that to the company's sale price of the product in the US.

If the sale price is lower than in the home country, the US registers the difference as a negative number, while if it is higher, the US registers it as zero. Significant overall negatives can trigger anti-dumping tariffs.

Most countries contend that export prices higher than domestic prices should be averaged against lower prices to determine whether or not a company is generally engaged in dumping. In a string of recent cases, the WTO has found that zeroing violates its rules, though it has sometimes upheld certain uses of the practice.

The state-run newspaper Tuoi Tre on Monday quoted Deputy Trade Minister Le Danh Vinh as saying oy would be the first time Vietnam filed a protest with the WTO since it joined in 2007.

Vinh said the WTO mechanism mandated a 60-day discussion period between the parties before it steps in to resolve the dispute.

Vietnam exported 1.67 billion dollars of shrimp last year.

The US was the second-largest importer of Vietnamese shrimp, importing 395 million dollars' worth in 2009, down 15 per cent from 2008. Vietnam is the fifth-largest shrimp exporter to the US.