CIRCULAR NO. 30/2020/TT-BCT GUIDING THE IMPLEMENTATION OF THE FREE TRADE AGREEMENT BETWEEN THE SOCIALIST REPUBLIC OF VIETNAM AND THE EUROPEAN UNION ON TRADE DEFENSE MEASURES

CIRCULAR

GUIDANCE ON IMPLEMENTING THE FREE TRADE AGREEMENT BETWEEN THE SOCIALIST REPUBLIC OF VIETNAM AND THE EUROPEAN UNION ON TRADE DEFENSE MEASURES

BETWEEN THE SOCIALIST REPUBLIC OF VIETNAM AND THE EUROPEAN UNION

Pursuant to the Law on Foreign Trade Management No. 05/2017/QH14 dated June 12, 2017;

Pursuant to Resolution No. 102/2020/QH14 dated June 8, 2020 of the National Assembly approving the Free Trade Agreement between the Socialist Republic of Vietnam and the European Union;

Pursuant to Decree No. 98/2017/NĐ-CP dated August 18, 2017, of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Industry and Trade;

Pursuant to Decree No. 10/2018/NĐ-CP dated January 15, 2018, of the Government detailing some articles of the Law on Foreign Trade Management regarding trade remedy measures;

At the request of the Director of the Department of Trade Defense, the Minister of Industry and Trade issues this Circular to guide the implementation of anti-dumping and countervailing measures under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

The Minister of Industry and Trade issues this Circular guiding the implementation of the Free Trade Agreement between the Socialist Republic of Vietnam and the European Union on trade defense measures.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

1. This Circular guides the application of bilateral safeguard measures, anti-dumping measures, and countervailing measures for the enforcement of the Free Trade Agreement between the Socialist Republic of Vietnam and the European Union.

2. The provisions of this Circular apply to goods originating from:

- The territory of the member states of the European Union;

- The United Kingdom and Northern Ireland; and

- The Principality of Andorra; the Republic of San Marino.

Article 2. Applicability

1. State management agencies of Vietnam have the authority to investigate, apply, and handle trade defense measures to enforce the Agreement.

2. Domestic and foreign traders, agencies, organizations, and individuals related to the investigation, application, and handling of trade defense measures to enforce the Agreement.

Article 3. Explanation of Terms

According to this Circular, the following terms are understood as follows:

1. The Agreement is the Free Trade Agreement between the Socialist Republic of Vietnam and the European Union.

2. Bilateral safeguard measures are measures provided for in Article 3.10 Chapter 3 of the Agreement and Article 99 of the Law on Foreign Trade Management.

3. The transition period is from August 1, 2020 to July 31, 2030.

5. The investigating authority is the Department of Trade Defense - Ministry of Industry and Trade.

Chapter II

Article 4. Notification

Article 4. Consideration of Economic and Social Benefits

1. The Ministry of Industry and Trade decides not to apply anti-dumping or countervailing measures if, based on available information during the investigation, the investigating authority concludes clearly that the application of such measures is not in line with economic and social interests.

2. When assessing economic and social benefits, based on relevant information provided, the investigating authority will consider the situation of the domestic industry, importers, related associations, organizations, and individuals using or consuming the investigated goods.

Article 5. Rules for Lower Tax Rates

1. Anti-dumping duties or countervailing duties shall not be higher than the dumping margin or subsidy rate.

2. Based on the conclusion of the investigating authority, the Ministry of Industry and Trade will consider applying lower anti-dumping or countervailing duties than the dumping margin or subsidy rate if such lower duties are sufficient to eliminate damage to the domestic industry.

Chapter III

BILATERAL DEFENSIVE MEASURES

Article 6. Principles for Applying Bilateral Defensive Measures

1. At the same time, bilateral safeguard measures and safeguard measures under Article XIX of the General Agreement on Tariffs and Trade 1994 shall not be applied simultaneously to the same imported goods benefiting from preferential tariff rates under the Agreement.

2. Bilateral safeguard measures shall not be applied outside the transition period except where there is agreement with the European Union.

1. The application file for bilateral safeguard measures (referred to as the Application File in this Chapter) includes the Request for Application of Bilateral Safeguard Measures and related documents as stipulated in Article 47 of Decree No. 10/2018/NĐ-CP.

2. The Application Form for Bilateral Safeguard Measures as prescribed in Clause 2 of Article 47 of Decree No. 10/2018/NĐ-CP must meet the following specific contents:

a) Name, address, and other necessary information of the organization or individual representing the domestic producing industry.

b) Information, data, and evidence to determine the representative of the domestic industry, including a list of domestic organizations and individuals producing like or directly competitive products; the quantity and volume of like or directly competitive products produced by these organizations and individuals;

c) Name and address of organizations or individuals producing similar goods supporting or opposing the case;

d) Information describing the imported goods benefiting from preferential tariff rates under the Agreement subject to investigation and application of safeguard measures, including scientific name, commercial name, common name; composition; basic physical and chemical characteristics; main purpose of use; production process; international and Vietnamese standards; tariff code and preferential tariff rate according to the Special Preferential Tariff Schedule implementing the Agreement;

đ) Information describing the like or directly competitive products of the domestic industry, including scientific name, commercial name, common name; basic physical and chemical characteristics; main purpose of use; production process; international and Vietnamese standards;

e) Information about the quantity, volume, and value of the imported goods specified in point d of this clause in the three-year period before submitting the Application File and including at least six months after the Agreement takes effect;

g) Information about the quantity, volume, and value of the like or directly competitive products of the domestic industry specified in point đ of this clause in the three-year period before submitting the Application File and including at least six months after the Agreement takes effect. In cases where the domestic industry has been operating for less than three years, the collected data covers the entire period of operation of the domestic industry up to the date of submission of the Application File;

h) Information, data, and evidence regarding serious injury or threat of serious injury to the domestic industry;

i) Information, data, and evidence regarding the causal relationship between the importation of goods specified in clause d of this article and serious damage or threat of serious damage to the domestic industry;

k) Specific requests regarding the application of safeguard measures, duration of application, and degree of application.

Article 8. Notification

The investigating authority will notify the European Union in writing of the investigation and application of bilateral safeguard measures and consult with the European Union in accordance with the provisions of the Agreement.

Article 9. Investigation and Application of Bilateral Safeguard Measures

1. The investigation period for applying bilateral safeguard measures is one year from the date the investigation decision is issued.

2. The Minister of Industry and Trade decides on the application of bilateral safeguard measures when the investigation report of the investigating authority includes the following contents:

a) There is an absolute or relative increase in the importation of goods benefiting from the special preferential tariff rate under the Agreement compared to the volume and quantity of similar goods and directly competing domestic products;

b) The domestic industry suffers serious injury or is threatened with serious injury;

c) The increase in imports specified in point a of this clause is the cause of serious damage or a threat of serious damage to the domestic production industry.

3. Bilateral safeguard measures include:

a) Suspend the continued reduction of the import tariff rate as provided for in the Agreement; or

b) Increase the import tariff rate on such goods but not exceeding the effective preferential tariff rate at the time this measure is applied or the basic import tariff rate specified in the tariff schedules in Appendix 2-A (Abolition of customs duties) under Article 2.7 (Reduction or abolition of customs duties on imported goods) of the Agreement, whichever is lower.

4. The duration of the application of the bilateral safeguard measure shall not exceed two years. In cases where the investigating authority concludes that it is necessary to continue applying the bilateral safeguard measure to prevent or remedy serious injury and facilitate adjustment by the domestic industry, the duration may be extended by up to two additional years.

5. Where the duration of the application of the bilateral safeguard measure exceeds two years, the bilateral safeguard measure must be gradually relaxed throughout the period of its application.

6. After the expiration of the duration of the bilateral safeguard measure, the import tariff rate applicable to related goods shall be implemented according to the provisions of the Agreement effective at the time the bilateral safeguard measure ceases to apply.

Article 10. Interested Parties in the Investigation of Bilateral Safeguard Measures

1. Interested parties in the investigation of bilateral safeguard measures include:

a) Organizations and individuals producing and exporting goods under investigation into Vietnam;

b) Organizations and individuals importing goods under investigation;

c) Associations with a majority of members being organizations and individuals producing and exporting goods under investigation;

d) The Government and the competent authorities of the European Union exporting the investigated goods;

đ) Organizations and individuals submitting applications for the application of bilateral safeguard measures;

e) Organizations and individuals domestically producing similar goods and directly competitive goods;

g) Domestic associations in Vietnam with a majority of members being organizations and individuals producing similar goods and directly competitive goods;

h) Other organizations and individuals having legitimate rights and interests related to the investigation or who can assist in the investigation process or represent consumer interests.

2. Organizations and individuals must register and be approved by the investigating authority to become interested parties in the investigation in accordance with the provisions of the Law on Foreign Trade Management.

Chapter IV

IMPLEMENTING PROVISIONS

Article 11. Effective Date

1. This Circular takes effect from January 11, 2021.

2. The provisions of this Circular shall only apply to goods originating from the United Kingdom and Northern Ireland from the date this Circular takes effect until December 31, 2020 (which may be extended to 24 months pursuant to the agreement on the withdrawal of the United Kingdom and Northern Ireland from the European Union).