What is safeguard measure? Conditions for the imposition of safeguard measures in Vietnam

What is safeguard measure? Conditions for the imposition of safeguard measures in Vietnam (Internet image)

1. What is safeguard measure?

Safeguard measure imposed on foreign products imported to Vietnam (hereinafter referred to as “safeguard measure”) is measure imposed on increased imports of particular products to Vietnam, which causes the serious injury or threat of serious injury to the domestic industry.

(Clause 1, Article 91 of the Law on Foreign Trade Management 2017)

2. Safeguard measures in Vietnam 

Safeguard measures include:

- Imposition of safeguard duties;

- Imposition of import quotas;

- Imposition of tariff-rate quotas;

- Issuance of import license;

- Other safeguard measures.

(Clause 2, Article 91 of the Law on Foreign Trade Management 2017)

3. Conditions for the imposition of safeguard measures in Vietnam

- A safeguard measure will be imposed on imports if all following conditions are satisfied:

+ There is an absolute increase or a relative increase in imports compared with domestic production of like products;

+ There is a serious injury or threat of serious injury to the domestic industry;

+ The increased production of imports prescribed in Point a of this Clause is the major cause of the serious injury or threat of serious injury to the domestic industry.

- If the production of imports originating in a developing country accounts for not more than 3% of total imports of like products to Vietnam and the total production of products originating in developing countries and satisfying the abovementioned conditions accounts for than 9% of the total production of imports of like products to Vietnam, these countries will be exempt from the safeguard measures.

(Article 92 of the Law on Foreign Trade Management 2017)

4. Bases for conducting safeguard investigations in Vietnam

- The safeguard investigation will be conducted if a domestic producer of like or directly competitive products (“directly competitive products” mean products that are able to be substituted for products subject to the safeguard measures by the buyer due to their advantages and use purposes) submits an application for the imposition of safeguard measures.

- The application shall prove that the excessive import of products to Vietnam causes the serious injury or threat of serious injury to the domestic industry.

- The Minister of Industry and Trade shall decide the investigation if there is clear evidence that the excessive import of products to Vietnam causes the serious injury or threat of serious injury to the domestic industry.

5. Application for imposition of safeguard measures in Vietnam

The written request for imposition of safeguard measures includes the following contents:

- Name, address and other necessary information of the organization/individual representing the domestic industry;

- Information, data and evidences for determining the representative of the domestic industry, including list of domestic organizations and individuals producing similar goods or directly competitive goods; volume and quantity of similar goods or directly competitive goods produced by the above organizations and individuals;

- Names and addresses of organizations and individuals producing similar goods supporting or opposing the case;

- Description of the imports subject to investigation of imposition of safeguard measures, including scientific names, trade names, common names; ingredient; basic physical and chemical characteristics; production process; main purpose; Vietnam and international standards/regulations; codes of goods in accordance with the List of Imports and Exports of Vietnam and the effective import tax rates applied according to the export tariffs and import tariffs in each period;

- Description of similar goods or directly competitive goods of the domestic industry, including scientific names, trade names, common names; ingredient; basic physical and chemical characteristics; main purpose; Vietnam and international standards/regulations;

- Information on the volume, quantity and value of the imports specified in Point d of this Clause within 03 years prior to the submission of dossiers;

- Information on the volume, quantity and value of similar goods or directly competitive goods of the domestic industry specified in Point dd of this Clause within 03 years prior to the submission of dossiers; In case the domestic industry has less than 3 years of operation, the data collected will be the entire operation duration of such domestic industry up to the time of submission of the application;

- Information, data and evidences on serious damage or threat to cause serious damage to the domestic industry;

- Information, data and evidences on the causal relationship between the imports of goods specified in Clause d this Point and the serious damage to the domestic industry or threat to cause serious damage to the domestic industry;

- Specific requirements on the imposition

(Clause 2, Article 47 of Decree 10/2018/ND-CP)

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