Thai sugar cane avoid tax to be imported into Vietnam

Thai sugar cane avoid tax to be imported into Vietnam

The Vietnam Ministry of Industry and Trade is investigating anti-dumping and anti-subsidy of Thai sugarcane, which is accused of evading through 5 ASEAN countries to enter Vietnam.

A representative of the Trade Remedies Department (Ministry of Industry and Trade) said that in the period from mid-February to the end of December 2021 after applying temporary anti-dumping and anti-subsidy taxes on Thai sugar, the total Sugar imports from the ASEAN countries mentioned above were more than 853,000 tons, averaging about 85,000 tons/month, up 194% compared to the previous period and even 255% over the same period in 2020.

However, the amount of sugar imported from other ASEAN countries is for domestic production and consumption. Specifically, from Cambodia, Indonesia, Laos, Malaysia and Myanmar increased rapidly. Citing data from the General Department of Customs (Ministry of Finance), the Vietnam Sugar Association stated that in the first six months of 2021, the amount of sugar imported from Cambodia, Laos, Malaysia, Myanmar, and Indonesia into Vietnam reached 399,189 tons. , increased 10 times compared to 38.61 tons in the same period last year.

While these countries have absolutely no development in sugar cane competitiveness to be able to export sugar to Vietnam. Thus, there are early signs that sugar from Thailand can be imported through ASEAN countries to evade anti-dumping and anti-subsidy measures.

According to the Trade Remedies Administration, the case is currently under investigation, collecting information from manufacturing and exporting enterprises and the Governments of the countries under investigation as well as enterprises of the manufacturing industry in the country. According to the Law on Foreign Trade Management, the time limit for investigating the case is 6 months and in complicated cases, it can be extended for another 6 months.

What does the Ministry of Industry and Trade say about the signs of tax evasion with cane sugar of 5 ASEAN countries?

The Ministry of Industry and Trade has actively coordinated with the Vietnam Sugar Association to monitor the import situation and actively consulted and supported the Vietnam Sugar Association as well as the domestic cane sugar industry in collecting information, developing a dossier of request for investigation against evasion of trade remedies with cane sugar products to ensure compliance with Vietnam’s regulations.

Acts of evading trade remedies are often complex in nature, involving many contents, legal regulations and international commitments. Countries also have different regulations on this issue. In some cases, even though goods fully meet the rules of origin, they can still be considered circumvention.

This trend was predicted by the Ministry of Industry and Trade early, so after a period of collecting evidence, the Ministry of Industry and Trade issued Decision No. 2171/QD-BCT to initiate an investigation and apply anti-evading preventive measures. Trade protection includes anti-dumping and anti-subsidy measures for cane sugar imported from some of the ASEAN countries mentioned above.

In principle, the investigation is to verify whether there is evasive behavior by Thailand through the five ASEAN countries mentioned above. Specifically, verifying whether or not Thai sugar products such as raw sugar, white sugar, and refined sugar, which are exported to the aforementioned ASEAN countries, are simply processed in these countries.

For example, refining, packing… and then exporting to Vietnam to avoid the trade remedy tax applied to Thai sugar.

ASL LAW is the top-tier Vietnam law firm for Anti-dumping & countervailing. If you need any advice, please contact us for further information or collaboration.


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