Vietnam rejects US new tax on Vietnamese tra fish

The Vietnam Association of Seafood Exporters and Processors (VASEP) has rejected the US Department of Commerce’s new calculations of tax rates imposed on Vietnamese tra fish imported to the US.

In its recent annual administrative review on March 15, the US department chose Indonesia as a benchmark country to calculate anti-dumping margins on Vietnam’s frozen fish fillet exports instead of Bangladesh which is used for the calculations seven times previously.
Accordingly, the new tax rates were adjusted to increase more than 10 times, from just several cents per kilo to several dollars per kilo. 

The Directorate of Fisheries of Vietnam (D-Fish) is considering suing the US Department of Commerce in a US federal court for its unfair calculation of anti-dumping margins on Vietnamese frozen fish fillets.

D-Fish Deputy General Director Pham Anh Tuan described the DOC’s decision as unfair, explaining that Indonesia’s socio-economic conditions are completely different from Vietnam’s.

He said the fisheries sector is working with the Vietnam Association of Seafood Exporters and Processors (VASEP) and lawyers to make clear the US’s possible miscalculations.

The VASEP also expressed its indignation over the DOC’s sudden benchmark country replacement and claimed the US decision was unreasonable.

According to the VASEP, the DOC relied on the Indonesian government’s study of its tra fish prices based on information from just several localities of the country, resulting wider margins.

In the previous seven administrative reviews, Indonesia was not chosen as a model for tax calculations as it had no sufficient pricing and financial data. In fact, Indonesia imports frozen tra fillets, mainly from Vietnam, and it does not export tra fish products to the world market.

The VASEP and its tra fish businesses will take necessary legal measures to protect the fishery industry and ask the DOC to correct its decision according to US laws and WTO agreements.

Processing tra fish in a factory (photo Vietnam net)

The VASEP proposed that the DOC maintain Bangladesh as the reference country for calculating prices of Vietnamese tra fish products.

As the US determination takes effect within five days’ time, the Directory of Fisheries and its lawyers are considering the possibility of bringing the case to the US federal commercial court.

Businesses will not have to hand in the required deposits for new tax rates before the final ruling is issued.

It’s worth remembering that in the previous seven reviews the US selected Bangladesh as the reference country to calculate the margins on Vietnamese fish products.

Dao Tran Nhan,  Embassy Counsellor, Trade Representative of Vietnam in the United States said the DOC’s decision was strongly impacted by groups of US catfish farmers and processors, particularly the Catfish Farmers of America, that lobbied the DOC to select Indonesia instead of Bangladesh in tax calculations.

The US conducts an annual administrative review against Vietnamese exports under its anti-dumping lawsuits. Nhan suggested that Vietnamese businesses and lawyers gather sufficient evidence before the US issues its 9th preliminary determination scheduled for September 2013 as well as the final determination in March 2014.

He also asked them to be well prepared for another possible scenario in which the DOC would select another country to calculate new tax rates on Vietnamese fish fillets.

Many fishery experts advised both farmers and businesses to keep a cool head, or else the situation could lead to a temporary sell-off, resulting great losses.

Tran Thanh Hai, head of the Can Tho City Fisheries Department, asked VASEP and relevant Vietnamese agencies to take action to protect farmers and businesses from this unfair decision.

Nguyen Van Phan, General Director of Hiep Thanh Seafood Processors Company suggested that the fishery sector restructure production and export markets, giving priority to businesses subject to low margins. Those subject to higher rates will shift to other markets outside the US.

Anticipating the difficulties in US market, Hiep Thanh actively diversified its export market from the United States to the EU market, Russia, Australia, South America, Africa ...

Go Dang Company leaders also acknowledge that  with the tax rate increase more than 10 times to US$ 1.81 per kg, Go Dang will abandon US market to focus on traditional markets in the EU.

Source SGGP, DTTC - translated by Dan

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