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Vietnam’s plastic bags under US lawsuit threat
Polyethylene retail carrier bags, or plastic bags, imported from Vietnam may face an anti-dumping lawsuit in the US.
An American lawyer told a recent conference in Ho Chi Minh City that there are warning signs that import of the products at low prices has increased.
Ken Pierce, a lawyer from Hughes Hubbard & Reed, was speaking at the conference organized by the Vietnam Plastic Association on Saturday to prepare for the eventuality.
Pierce said Vietnam was the second largest exporter of plastic bags to the US in the first eight months of this year. It is also the largest among plastic bag exporters that are not subject to anti-dumping taxes from the US.
He said exporters from Vietnam have offered the lowest prices for their products and American rivals who have suffered overall decline in revenues, considered this an unfair trading practice.
The lawyer said US petitioners, supported by another US law firm, King & Spalding, had sent a letter to the US Trade Representative, opposing the government’s policy to offer generalized system of preferences (GSP) to Vietnam’s plastic bag exporters.
GSP is a program providing preferential tariffs for products from 131 designated countries and territories.
“It is an initial step for a lawsuit by them against Vietnam’s exporters of the bags,” said Pierce.
Dinh Thi My Loan, chairwoman of the Trade Remedies Council under the Vietnam Chamber of Commerce and Industry, said US firms want to prevent the products moving from exporting countries already subject to punitive tariffs to others.
Many factories from China and other countries and territories have moved to Vietnam to circumvent anti-dumping orders from the US government, said Pierce.
The US government has imposed punitive measures on plastic bags imported from China, Thailand and Malaysia since 2004 and will start Sunset Reviews next July.
Sunset Review is a system under the World Trade Organization (WTO) Anti-dumping Agreement and generally implemented by WTO members.
If the reviews confirm the cancellation of anti-dumping measures would result in further dumping, investigative institutions may decide to continue implementing anti-dumping measures.
The maximum anti-dumping tariff rates are 77.57 percent for plastic bags from China, 122.88 percent for Thailand and 101.74 percent for Malaysia.
Ho Duc Lam, secretary general of the Vietnam Plastic Association, said plastic bags from Vietnam have enjoyed import tax rates of less than 5 percent.
Last year, Vietnam shipped about US$650 million worth of plastic products worldwide, including more than $350 million worth of polyethylene retail carrier bags and other kinds of plastic packages to the US, according to the association.
The association expects the country’s total plastic export value this year to hit $900-950 million.
Foreign-invested businesses in Vietnam are main exporters of plastic bags to the US and there are only three Vietnamese plastic bag producers exporting their products to the market, Lam told Thanh Nien Daily.
Lam, who is also chairman of domestic Rang Dong Plastic Joint Stock Company, said Vietnam’s plastic industry would be hurt if any lawsuit was filed by US plastic producers.
Lam said some foreign-invested plastic producers just package their finished products in Vietnam and then export them with certificates of origin issued by Vietnamese authorities.
The government should reconsider licensing to foreign investors who want to utilize the Vietnamese origin label for their products in order to avoid anti-dumping measures imposed on their countries, he suggested.
Pierce said although the lawsuit, if any, is aimed at foreign-invested exporters operating in Vietnam, Vietnamese businesses should also prepare for the case.
About 2,000 businesses are operating in Vietnam’s plastic industry. They import almost all the raw material needed for production.
Thanhnien
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