Vietnam: 06 important contents on application of bilateral safeguard measures according to EVFTA

According to Article 9 of the Circular No. 30/2020/TT-BCT of the Ministry of Industry and Trade of Vietnam, investigation and application of bilateral safeguard measures are specified as follows:

1. The time limit for investigation for application of a bilateral safeguard measure is 01 year from the date on which the decision to initiate the investigation is issued.

2. The Minister of Industry and Trade shall decide to impose the bilateral safeguard measure when the report given by the investigating authority contains the following findings:

- There is an absolute or relative increase in amounts/quantities of imported good applying the most-favored-nation rate of customs duty under the Agreement, compared to those of the like and directly competitive good domestically produced;

- The domestic industry suffers from serious injury or threat of serious injury;

- The serious injury or threat of serious injury incurred by the domestic industry is caused by the increased imports as set out in Point a of this Clause.

3. The applied bilateral safeguard measure includes:

- Suspension of the further reduction of the rate of customs duty on the imported good as provided for in the Agreement; or

- Increase of the rate of customs duty on the imported good to a level which does not exceed the lesser of the at the most-favored-nation applied rate of customs duty on the imported good in effect at the time the measure is taken, or the base rate of customs duty on the imported good specified in the schedules included in Annex 2-A (Elimination of Customs Duties) pursuant to Article 2.7 (Reduction or Elimination of Customs Duties) of the Agreement.

4. A bilateral safeguard measure shall be maintained for a period not exceeding 02 years.  This period may be extended up to 02 years if the investigating authority determines that the bilateral safeguard measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment for the domestic industry.

5. Where the expected duration of a bilateral safeguard measure is over 02 years, it must be progressively liberalized at regular intervals during the period of application.

6. On the termination of a bilateral safeguard measure, the rate of customs duty imposed on the relevant goods shall be the duty set out in the Agreement in effect at the time of termination of such bilateral safeguard measure.

View more details at the Circular No. 30/2020/TT-BCT of the Ministry of Industry and Trade of Vietnam, effective from January 15, 2021.

Thuy Tram

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