What is the sanction for enterprises that commit dumping in Vietnam? How much is fine for enterprises that commit dumping in Vietnam?

What is the sanction for enterprises that commit dumping in Vietnam? 

In Article 8 of Decree 75/2019/ND-CP stipulating abuse of dominant position as follows:

1. A fine ranging from 01% to 10% of total turnover of the enterprise holding dominant market position or each enterprise in the group of enterprises holding dominant market position earned from the relevant market in the financial year preceding the year in which the violation is committed shall be imposed upon that enterprise for:

a) Selling goods or providing services below the costs that drives or probably drives competitors out of the market;

b) Imposing unreasonable purchase or selling prices of goods or services or setting a minimum resale price maintenance that causes or may cause harm to customers.

c) Restricting production or distribution of goods or provision of services, limiting markets or restricting technical/technological development that causes or may cause harm to customers;

d) Applying dissimilar conditions to equivalent transactions with other trading parties that prevents or may prevent other enterprises from engaging in or expanding their market or force them out of the market;

dd) Applying conditions for concluding contracts for trading of goods or provision of services to other enterprises or requesting other enterprises or customers to accept obligations which are not related to objects of contracts, that prevents or may prevent other enterprises from engaging in or expanding their market or force them out of the market;

e) Preventing other enterprises from engaging in or expanding their market;

g) Performing other prohibited acts of abuse of dominant position as regulated by law.

2. Additional penalties:

Profits illegally obtained from the administrative violation shall be confiscated.

3. Remedial measures:

a) The violating entity is forced to remove illegal terms and conditions from business contracts, agreements or transactions;

b) The enterprise that abuses its dominant position is forced to carry out restructuring.

According to Article 9 of Decree 75/2019/ND-CP stipulating abuse of monopoly position as follows:

1. A fine ranging from 01% to 10% of total turnover of the enterprise holding the monopoly position earned from the relevant market in the financial year preceding the year in which the violation is committed shall be imposed upon that enterprise for:

a) Performing acts prescribed in Point b, c, d, dd or e Clause 1 Article 8 of this Decree;

b) Imposing terms and conditions unfavorable to customers;

c) Taking advantage of the monopoly position to unilaterally modify or invalidate the signed contract without legitimate reasons;

d) Performing other prohibited acts of abuse of the monopoly position as regulated by law.

2. Additional penalties:

Profits illegally obtained from the administrative violation shall be confiscated.

3. Remedial measures:

a) The enterprise that abuses the monopoly position is forced to carry out restructuring;

b) The violating entity is forced to remove illegal terms and conditions from business contracts, agreements or transactions;

c) The violating entity is forced to restore conditions for technical/technological development which it has obstructed;

d) The violating entity is forced to remove terms and conditions unfavorable to customers;

dd) The violating entity is forced to restore terms and conditions of contracts or contracts which have been changed or invalidated without legitimate reasons.

Thus, according to the above provisions in Vietnam, dumping can be considered as an abuse of dominant position or an abuse of monopoly position. Depending on the case, there will be different specific sanctions. 

In case Company H sells products of the same type as your business for less than 10,000 dong, this is the act of selling goods or providing services below the cost. Company H is violating the law and will be administratively sanctioned in Vietnam.

How much is fine for enterprises that commit dumping in Vietnam?

Pursuant to Article 21 of Decree 75/2019/ND-CP stipulating selling goods or providing services below costs as follows:

1. A fine ranging from VND 800,000,000 to VND 1,000,000,000 shall be imposed for selling goods or providing services below their costs and thus driving or potentially driving other enterprises selling or providing the same type of goods or services out of the market.

2. A fine twice as much as the fine for the administrative violation prescribed in Clause 1 or Clause 2 of this Article shall be imposed if the corresponding violation prescribed in Clause 1 or Clause 2 of this Article involves two provinces or central-affiliated cities or more.

3. Additional penalties:

a) The exhibits and instrumentalities for committing the administrative violation shall be confiscated;

b) Profits illegally obtained from the administrative violation shall be confiscated.

In Clause 7, Article 4 of Decree 75/2019/ND-CP stipulates the fine level:

7. The maximum fines prescribed in Chapter II of this Decree are imposed for violations committed by organizations. The maximum fine imposed upon an individual shall be equal to a half of that imposed upon an organization for committing the same administrative violation against regulations on competition.

Therefore, enterprise H that commits dumping will be fined from VND 800,000,000 to VND 1,000,000,000. In addition, enterprise H also confiscated the material evidences used to commit the offence, and confiscated the profits gained from the dumping in Vietnam.

What are anti-dumping measures in Vietnam?

According to Article 77 of the Law on Foreign Trade Management 2017, anti-dumping measures are prescribed as follows:

1. Anti-dumping measure imposed on imports of Vietnam (hereinafter referred to as “anti-dumping measure”) is a measure imposed on products that are dumped when being imported to Vietnam, which causes material injury or threaten to cause material injury to domestic industry or retard the establishment of the domestic industry.

2. A product that is determined as dumped if price of this product imported to Vietnam is less than the comparable price of its like products sold in the exporting country or third country under the common commercial conditions or the price that is self-calculated by the investigating authority.

3. Anti-dumping measures include:

a) Imposition of anti-dumping duty;

b) Undertakings to implement measures for removing the dumping carried out by organizations and individuals producing and exporting products subject to the anti-dumping measures with the investigating authority of Vietnam or domestic producers in case of the approval of the investigating authority.

The above are provisions on anti-dumping measures of the law in Vietnam.

Best Regards!