After nearly four years of implementation, certain provisions within Circular No. 37/2019/TT-BCT issued by the Ministry of Industry and Trade detailing the handling of proposals and decisions regarding the exemption from applying trade remedy measures in Vietnam have become incompatible with practical needs. This has led to certain difficulties related to Vietnam’s trade remedy system. In order to address these shortcomings, the Ministry of Industry and Trade of Vietnam has drafted an amendment proposal for Circular No. 37/2019/TT-BCT, awaiting public feedback.
To guide the implementation of Government Decree No. 10/2018/NĐ-CP, which details certain provisions of the Law on Foreign Trade Management regarding trade remedy measures during the period 2018 – 2020, the Ministry of Industry and Trade has issued two guiding Circulars:
i) Circular No. 06/2018/TT-BCT dated April 20, 2018, which provides detailed regulations on trade remedy measures; and
ii) Circular No. 37/2019/TT-BCT dated November 29, 2019, which details certain provisions of trade remedy measures. This Circular replaces the aforementioned Circular No. 06/2018/TT-BCT.
After nearly four years of implementation, Circular No. 37/2019/TT-BCT has become a legal normative document that provides a clear legal basis for the Trade Remedies Administration and the Ministry of Industry and Trade to handle proposals and make timely, reasonable, and compliant decisions regarding the exemption from applying trade remedy measures, ensuring the effectiveness of these measures in practice.
However, during the process of reviewing and improving the overall trade remedy legal system and Circular No. 37/2019/TT-BCT in particular, the Trade Remedies Administration has identified certain issues that need to be amended regarding the decisions on exemptions from applying trade remedy measures in order to align with practical requirements.
One noteworthy aspect of the current proposal by the Ministry of Industry and Trade of Vietnam concerns the scope of exemptions from applying trade remedy measures. Currently, according to Article 10 of Circular No. 37/2019/TT-BCT, the Ministry of Industry and Trade examines the exemption from applying trade remedy measures in six cases, including the case of “similar goods, domestically produced competitive goods do not meet sufficient domestic demand.”
Citing insufficient domestic production capacity and domestic consumption needs as per the above case, enterprises have submitted requests for exemption from applying trade remedy measures to continue their business operations. However, the reality is that domestic production can hardly meet domestic demand in most investigation cases, thus making the above case an inevitable one for application if enterprises seek exemption from applying trade remedy measures.
Although this deficiency can still be compensated for by non-affected imports of goods that are not subject to trade remedy measures, if the aforementioned reason is used to reject applications for exemption from applying trade remedy measures, enterprises may raise concerns and objections to the Administration’s decision, citing provisions in Circular No. 37.
To thoroughly address this issue, the proposed draft considers removing the provision regarding exemptions in cases of similar goods and domestically produced competitive goods that do not meet sufficient domestic demand.
The draft can be downloaded from here.