Customs News– The Ministry of Industry and Trade has formally asked that the Republic of Korea (RoK) consider imposing a reasonable tax rate based on provisions outlined in the Vietnam-Korea Free Trade Agreement (VKFTA)
The Department of Trade Remedies under the Ministry of Industry and Trade (MoIT) stated that on April 29, the Korean Trade Commission (KTC) issued a preliminary conclusion with regard to the anti-dumping investigation into Vietnamese plywood.
The KTC initially concluded that Vietnamese firms that export plywood have been dumping their items into the Korean market with a margin of between 9.15% and 10.65%, causing significant damage to the domestic manufacturing industry within the RoK.
Upon receiving this information, the MoIT made it a priority to study the contents of the preliminary conclusion, before analyzing and comparing it with the provisions set out by the World Trade Organization, in addition to the practical investigation experience of several other countries. This led the MoIT to send a four-point statement on May 25 in response to the preliminary conclusion of the KTC.
Firstly, the MoIT requests that the KTC consider and ensure that plaintiffs are eligible to represent the domestic manufacturing industry as previously had been stipulated.
Secondly, the MoIT asks that the KTC will think about adjusting the scope of products under investigation. The range of products to be investigated in this case is very large, with some products included that firms from the RoK do not produce. In addition, Vietnamese plywood products can be considered different items that do not compete with those produced by Korean enterprises.
Thirdly, the MoIT proposes that the KTC move to scrutinise the method of calculating dumping margins for Vietnamese export firms, as well as fully considering the performance indicators within the domestic manufacturing industry when providing damage assessment.
Finally, the MoIT believes that anti-dumping measures could cause a negative impact on other Korean manufacturing industries, mostly small and medium enterprises, many of whom utilise plywood as a main raw material.
Aside from these key points, the ministry also requested that the KTC consider the opinions of the Vietnamese side and cancel their investigation. In the event that the KTC still decides to apply anti-dumping measures, the ministry therefore requests they consider applying a reasonable tax rate based on provisions set out in the VKFTA as a means of minimising the impact on local export enterprises without causing a negative effect on the growing trade ties between the two nations.