New challenge for exported bicycles to EU

The revival of Vietnamese bicycle exports is still facing problems despite the European Union removing anti-dumping duties, according to the Ministry of Industry and Trade’s Competition Authority.

The European Commission decided to scrap anti-dumping tariffs on Vietnamese bicycles last July, while many other countries continue to be subject to the duties.

This resulted in the fact that a number of bicycles from other countries are shipped to Vietnam and then exported to the EU under the trademark “Made-in-Vietnam” in order to avoid the market’s anti-dumping duties, Vu Ba Phu, the Deputy Head of the Ministry’s Competition Authority, told a VNA reporter.

If it fails to prevent these illegal actions, the export of bicycles made in Vietnam to the EU would see an unusual “hot” growth, resulting in EU manufacturers requiring the European Commission to take sanctions, he warned.

“At that point, Vietnam ’s bicycles are at risk of being hit by anti-dumping duties again,” he stressed.

He was also concerned that if the EU resumes their sanctions on Vietnamese bikes, it will negatively affect the Vietnamese bicycle industry and damage Vietnam ’s image in international trade circles.

The EU’s decision to end its sanctions on Vietnamese bikes reflects the real developments in the Vietnamese bicycle industry and will benefit a large number of European consumers, said Phu.

“Vietnam will resolutely fight Vietnam being used as middle-ground for exporting bicycles to the EU” in order to protect businesses and ensure the country’s reputation, he stated.

According to the official, the Ministry of Industry and Trade has asked all concerned ministries, department and localities to watch out for such trade fraud as well as closely monitor foreign invested bicycle projects, to prevent any attempt to take advantage of the EU removing anti-dumping duties on Vietnamese bicycles.

“The ministry is willing to cooperate with the EC to conduct investigations and punish cases relating to the illegal shipping of bicycles,” said Phu.

The Vietnam Automobile, Motorcycle and Bicycle Association needs to closely supervise the output of domestic bicycle producers and promptly discover cases of fraud.

 

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New challenge for exported bicycles to EU

The revival of Vietnamese bicycle exports is still facing problems
despite the European Union removing anti-dumping duties, according to
the Ministry of Industry and Trade’s Competition Authority.

The
European Commission decided to scrap anti-dumping tariffs on Vietnamese
bicycles last July, while many other countries continue to be subject to
the duties. This resulted in the fact that a number of bicycles from
other countries are shipped to Vietnam and then exported to the EU
under the trademark “Made-in-Vietnam” in order to avoid the market’s
anti-dumping duties, Vu Ba Phu, the Deputy Head of the Ministry’s
Competition Authority, told a Vietnam News Agency reporter.

If it
fails to prevent these illegal actions, the export of bicycles made in
Vietnam to the EU would see an unusual “hot” growth, resulting in EU
manufacturers requiring the European Commission to take sanctions, he
warned.

“At that point, Vietnam ’s bicycles are at risk of being hit by anti-dumping duties again,” he stressed.

He
was also concerned that if the EU resumes their sanctions on Vietnamese
bikes, it will negatively affect the Vietnamese bicycle industry and
damage Vietnam ’s image in international trade circles.

The
EU’s decision to end its sanctions on Vietnamese bikes reflects the real
developments in the Vietnamese bicycle industry and will benefit a
large number of European consumers, said Phu.

“ Vietnam will
resolutely fight Vietnam being used as middle-ground for exporting
bicycles to the EU” in order to protect businesses and ensure the
country’s reputation, he stated.

According to the official, the
Ministry of Industry and Trade has asked all concerned ministries,
department and localities to watch out for such trade fraud as well as
closely monitor foreign invested bicycle projects, to prevent any
attempt to take advantage of the EU removing anti-dumping duties on
Vietnamese bicycles.

“The ministry is willing to cooperate with
the EC to conduct investigations and punish cases relating to the
illegal shipping of bicycles,” said Phu.

The Vietnam
Automobile, Motorcycle and Bicycle Association needs to closely
supervise the output of domestic bicycle producers and promptly discover
cases of fraud./.

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Bikes crippled by anti-dumping legacy

HCM CITY — The EU has lifted the anti-dumping tax that broke the back of Vietnamese bicycle manufacturers after it was imposed five years ago, but this is unlikely to revive the fortunes of the once-successful industry.

In its heyday between 2000 and 2005, the Vietnamese bike manufacturing industry held 11.7 per cent of the European market, exporting up to 1.1 million bikes a year.

But in July 2005, the EU slapped a 34.5 per cent anti-dumping tax and things have been going downhill since. Last year, Vietnamese exports were down to a mere 21,000.

"To develop again, Viet Nam should get the 3.5 per cent import tax under the EU's Generalised System of Preferences (GSP)," Chau Vinh Chi, export director of Asama Yu Jiun International Viet Nam, said.

Even though the anti-dumping tax was lifted last month Vietnamese bicycle exporters still pay 10 per cent import tax plus other taxes.

In the past, Asama used to export 400,000 bicycles each year, employed 1,500 workers, and outsourced to 20 contract manufacturers. "Customers are discussing new contracts with us. If we get the GSP, we can return to past levels within three months," Chi said.

But there is a catch: only countries on which the EU has never imposed anti-dumping tariffs qualify for the GSP.

While enterprises worry about the GSP, the Ministry of Industry and Trade is anxious about a return of anti-dumping taxes because of the rampant fraud committed in the country by foreign manufacturers trying to take advantage of the lower taxes on Vietnamese bicycles.

Measures

"If we do not have strong and efficient measures to stop illegal bicycles from nations affected by anti-dumping tax entering the country, the EU might resurrect the tax within six months," Vu Ba Phu, head of the ministry's Competition Management Department, warned.

"Companies should not make bicycles for foreign partners to avoid tax fraud."

He urged relevant authorities to work closely with the Viet Nam Chamber of Commerce and Industry, which grants certificates of origin (C/O) to manufacturers, and organise workshops regularly to keep the companies informed.

The Department has written to all investment and planning departments to carefully check new cycle manufacturers to see if they meet C/O requirements, especially for manufacturing bodies.

The department said there could be three common ways in which fraud is committed.

The first could be by manufacturers from countries suffering anti-dumping tariffs who simply fake the origin as being Vietnamese.

Others could bring their products into Viet Nam and affix a "made in Viet Nam" label.

The third method could involve setting up a basic plant in Viet Nam, importing most parts from outside, and assembling in the country to get the C/O.

Phu said if the illegal projects were detected and eliminated, Viet Nam could avoid anti-dumping tariffs.

"It is the best way to protect our businesses' rights as well as Viet Nam's image," he said. — VNS