The U.S. Department of Commerce is investigating possible evasion by Vietnamese suppliers of anti-dumping and anti-subsidy duties on wooden kitchen and bathroom cabinets imported from Vietnam that used Chinese-made components covered by the U.S. tariff regime.

The department launched the investigation after the American Kitchen Cabinet Alliance filed bypass investigation requests on April 22. The AKCA, a trade group representing American wood cabinet makers, has asked for rulings on cabinets labeled “made in Vietnam.”

The department’s investigation, announced in the June 10 Federal Register, aims to determine whether wood cabinets from Vietnam and Malaysia contain components imported from China into those countries.

If the finished products exported to the United States were found to include Chinese components, the finished products would be subject to trade remedies such as the taxes that the United States applies to like products exported directly from China.

The Commerce Department will have to issue final findings within 300 days of launching its investigation, although the investigation can be extended to conclude no later than 365 days after initiation, according to the Vietnam News website.

According to a spokesperson for the United States International Trade Commission, “This matter is before the Commerce Department, and the commission does not comment on trade matters.”

Speaking at a recent woodworking conference, Nguyen Pham Nhu Ha from the Vietnam Customs Control and Supervision Department under the General Department of Vietnam Customs said that over the past few months, the department had seen an increase in woodwork exports to the United States, according to Saigon time.

Ha said some Vietnamese companies imported veneer and plywood from China and then affixed “Made in Vietnam” labels to the final product, while others bought wooden parts from China to assemble them in Vietnam. then exported the products as made in Vietnam.

“Such a sophisticated circumvention trade method took time for customs authorities to investigate and collect evidence,” Ha said.

In response to a request for comment from Vietnam’s VOA, Vietnam’s Trade Remedies Department (TRAV) of the Ministry of Commerce and Industry (MOTI) referred to statements on its websites saying it recommends producers and wood cabinet exporters to study US anti-circumvention. investigation regulations and procedures.

Vietnamese authorities have also asked growers and exporters to fully comply with any U.S. request to provide information when working with TRAV.

Tran Quoc Thuan, a lawyer in Ho Chi Minh City and former deputy director of the Office of the National Assembly of Vietnam, told Vietnamese VOA that although Vietnam and the United States enjoy good relations, the Vietnamese government and its Exporters should take this investigation seriously and review their practices for importing and exporting wood products.

Tran added that “companies must also obey the laws, not only with lumber companies, but also with companies that import materials from countries considered hostile nations by the United States.”

The United States issued an order imposing anti-dumping and anti-subsidy duties on wood cabinets from China in February 2020 after the U.S. International Trade Commission in April 2019 determined that there was “reasonable indication that a US industry is suffering material injury from imports of wood cabinets and vanities from China that are allegedly subsidized and sold in the US at less than fair value.

Anti-dumping tax ranges from 4.37% to 262.18% while anti-subsidy tax rates can range from 13.33% to 293.45%, according to the US International Trade Administration.

US trade law enforcement was a key goal of President Donald Trump’s administration during a trade war with China, according to the US Trade Agency.

Since February 2020, due to US taxes, China’s wooden cabinet exports to the US have dropped by 54% from $2.5 billion to $1.6 billion, according to Viforest, which represents timber companies in Vietnam. During the same period, Vietnamese exports of wood products to the United States increased by more than 130%, from $1.37 billion to $2.7 billion.

At the same time, imports of these products from China to Vietnam rose from $232 million to $810 million, according to the association cited by Woodworking Network.

Do Xuan Lap, CEO and chairman of Tien Dat Furniture and chairman of Viforest, told Vietnamese news site Cong Thuong on June 13 that the U.S. investigation would hurt Vietnam’s timber industry.

“If the investigation finds that components made in China were part of Vietnamese cabinets exported to the United States, the United States will impose the same tariffs on products from China,” he said.

According to Viforest, the US market accounts for 68% of Vietnam’s export and wood product turnover.

After the United States imposed anti-dumping duties on kitchen cabinets and bathroom cabinets made in China in 2020, American buyers began ordering the items from Vietnam, where many Chinese factories were relocating, a declared Do.

Vietnam’s exports of wood and wood products to the United States were valued at $8.77 billion in 2021, an increase of 22.4 percent from $6.97 billion in 2020, according to Viforest.

In 2021, Vietnam’s total wood and wood products exports were $14.8 billion, a 19.7 percent increase from 2020 to $12.37 billion, according to the General Bureau of Statistics. from Vietnam.

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