U.S. Imposes Anti-Dumping Duty on Steel Products from Thailand, Malaysia and Vietnam

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HANOI – The U.S. Department of Commerce (DOC) announced its decision last week to impose an anti-dumping duty on stainless steel pressure pipes imported from Thailand, Malaysia and Vietnam.

The three petitioners for the anti-dumping investigation were Bristol Metals LLC of Tennessee, Felker Brothers Corp. of Wisconsin and Outokumpu Stainless Pipe, Inc. of Illinois. They claimed that circular welded austenitic stainless pressure pipes imported from Thailand, Malaysia and Vietnam were being sold at unfairly low prices, significantly injuring the U.S. manufacturing industry. The petitioners claimed that Thailand, Malaysia and Vietnam’s actions led to “reduced market share; increased market penetration; underselling and price depression or suppression; lost sales and revenues; declining production and shipments and reduced capacity utilization; increased inventories; and decline in financial performance.”

The ‘dumping’ of a product refers to a company exporting a product at a price which is lower than the one they charge in their domestic market. Although the World Trade Organization (WTO) promotes the principle of applying binding tariffs equally to all trading partners, it allows governments to implement protective measures if the dumping of products is hurting industry in the importing country. If a government wishes to proceed with anti-dumping measures, a detailed investigation, including the evaluation of all recent economic factors which may have had an effect upon the ‘injured’ industry, must first be conducted.

As a result of their final determinations on the issue, the DOC has instructed U.S. Customs and Border Protection to collect cash deposits in proportion to each country’s dumping margin. The Department of Commerce has set dumping margins ranging from 23.89 to 24.01 percent on Thai imports, 22.7 to 167.11 percent on Malaysian imports and a fixed duty of 16.25 percent on Vietnamese imports.  The DOC had previously made the preliminary decision of setting dumping margins ranging from 17.72 percent to 53.91 percent on Vietnamese imports, but this tax rate has now been reduced.

The next step in the anti-dumping investigation is the final decision of the U.S. International Trade Commission (USITC), which will be issued on July 6, 2014. If the USITC decides that the stainless steel pressure pipes imported from Thailand, Malaysia and Vietnam do not cause material injury, or threaten to cause material injury, to the domestic manufacturing industry in the U.S., no anti-dumping duty will be imposed upon imports from these countries. However, if the USITC agrees with the petitioners’ complaints, the DOC will issue the order to impose the anti-dumping duty on July 13, 2014.

This is not the only anti-dumping dispute regarding steel products involving countries in the region. Last October, Malaysia assigned an anti-dumping duty of 25.2 percent on steel wire rods imported from China, Thailand, Indonesia, Taiwan and Vietnam, to last from February 20, 2013 until February 19, 2018.

Furthermore, last December, Vietnam assigned provisional anti-dumping measures on imported cold-rolled stainless steel from China, Indonesia, Malaysia and Taiwan, setting taxes at between 6.45 and 6.99 percent for Chinese imports, 12.03 percent for Indonesian imports, 14.38 percent for Malaysian imports and between 13.23 and 30.73 percent for Taiwan.

It is estimated that the total value of the stainless steel pressure pipes imported from Thailand, Malaysia and Vietnam into the U.S. market in 2013 was worth US$16.9 million, US$11.9 million, and US$10.3 million respectively.

Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email asean@dezshira.com or visit www.dezshira.com.

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