On January 24, 2024, the U.S. Department of Commerce (DOC) accepted petitions for antidumping (AD) and countervailing duty (CVD) investigations on certain paper plates imported from China, Thailand, and Vietnam. In this case, Thailand is subject to AD investigation only, while China and Vietnam are subject to both AD and CVD investigations.
1. General Information about the Case
– Product Subject to Investigation: Certain paper plates under HS code 4823.69.0040.
– Case Numbers: A-552-839 (AD) and C-552-840 (CVD).
– Petitioners: A group of six U.S. paper plate manufacturers.
– Date of Petition Receipt: January 24, 2024.
– Export Volume: According to the petitioners, during the most recent 12-month period for which data is available (December 2022 to November 2023), imports from Vietnam amounted to approximately 3,240 tons, accounting for about 4.02% of total U.S. imports (with China at about 73.98% and Thailand at about 2.82%). According to USITC data, Vietnam exported approximately $9.3 million worth of these products to the U.S. in 2022. In the first 11 months of 2023, Vietnam exported about $7.4 million worth, a 16% decrease compared to the same period the previous year.
Allegations of Harm: Petitioners claim that the growth in imports from 2020 to 2023 has caused significant damage to the U.S. domestic industry.
– Accused Exporters: The petition names approximately nine Vietnamese companies.
– Proposed Period for AD/CVD Investigation: Calendar year 2023.
– Proposed Period for Injury Investigation: Three years (2020-2023).
1.1. Dumping Allegations:
– Alleged Dumping Margin for Vietnam: 255.46% to 278.46%.
– Surrogate Country and Values: As the U.S. considers Vietnam a non-market economy, the DOC will use surrogate country values to calculate the dumping margin. The petitioners suggest using Indonesia as the surrogate country due to its similar economic development level and significant paper plate production. Indonesia is on the DOC’s latest list of surrogate countries for Vietnam. Parties have 30 days to comment on the choice of surrogate country before the DOC issues its preliminary determination.
1.2. Subsidy Allegations:
– Alleged Subsidy Programs: Petitioners allege that Vietnamese paper plate producers/exporters benefit from 22 subsidy programs provided by the Vietnamese government, which cause significant harm or threaten to cause significant harm to the U.S. industry. These programs include:
(1) Income Tax Incentives: Exemptions and reductions for exporters, companies in special zones (e.g., industrial, economic zones), companies in economically disadvantaged areas, new investors, and accelerated depreciation programs.
(2) Import Duty Exemptions: Exemptions for imports used in export production, refunds on import duties for raw materials used in export production, exemptions for imports into industrial zones, exemptions for foreign-invested enterprises, and exemptions for export processing enterprises.
(3) Loan and Guarantee Programs: Preferential loans, export credit guarantees, and export factoring from state-influenced commercial banks (Agribank, Vietinbank, Vietcombank, BIDV), VDB investment credit programs, and SBV interest rate support programs.
(4) Land Concessions: Exemptions and reductions in land rental/tax or fees for water and land rental for encouraged industries, companies in industrial/economic zones, and foreign-invested enterprises.
(5) Provision of Utilities at Preferential Rates: Provision of utilities like electricity and water at preferential rates in industrial and export processing zones.
(6) Grants: Export promotion and investment support programs.
2. Next Steps in the Investigation Process:
According to U.S. investigation procedures, both the DOC and the U.S. International Trade Commission (ITC) are involved in AD/CVD investigations. The DOC investigates dumping and subsidies, while the ITC assesses injury to the domestic industry. AD/CVD duties are imposed only if both agencies make affirmative determinations. For CVD cases, the government of the exporting country is also investigated.
The investigation process includes:
Step 1: The Vietnamese government consults with the DOC regarding the CVD petition.
Step 2: The DOC has 20 days to review the petition and decide whether to initiate an investigation, expected by February 14, 2024. This period can be extended to 40 days in special cases.
Step 3: The ITC has 45 days from petition receipt to issue a preliminary injury determination. If the ITC preliminarily finds no injury, the investigation ends (though this is rare).
Step 4: The DOC has 140 days from initiation to issue a preliminary AD determination and 65 days for a preliminary CVD determination.
Step 5: The DOC issues final AD/CVD determinations within 75 days of the preliminary determinations.
Step 6: The ITC has 45 days from the DOC’s final AD/CVD determinations to issue a final injury determination.
Step 7: If both determinations are affirmative, the DOC issues AD/CVD orders within 7 days.
(The timelines may be extended.)
3. Recommendations
The Trade Remedies Authority of Vietnam recommends:
(i) Associations: Inform and support manufacturers/exporters of the implicated products to prepare response plans in case of an investigation.
(ii) Manufacturers/Exporters:
– Closely monitor the case’s progress and understand U.S. AD/CVD investigation procedures to develop a suitable defense strategy if an investigation is initiated.
– Fully cooperate with U.S. investigative authorities to avoid the use of adverse facts or the imposition of the highest alleged AD/CVD rates.
– Register for an IA ACCESS account on the DOC portal (https://access.trade.gov/login.aspx) to stay updated and submit relevant documents.
– Regularly coordinate and update the Trade Remedies Authority for timely support.
