January 10, 2013

Vietnam has requested the World Trade Organisation to set up a panel of arbitrators over a dispute involving alleged dumping of Vietnamese shrimp on the US market.

The escalation of the case is awkward for Washington as it attempts to strike a regional free trade deal with Vietnam while under domestic pressure from American shrimp producers to clamp down on Vietnamese imports.

Dumping, or damaging foreign competitors by exporting goods at unfairly low prices, is illegal under WTO rules.

Several WTO rulings have found that, until early last year, the US was using the wrong method of calculating dumping, forcing the US government to withdraw many of the accusations it had made.

However, Vietnam says the US Department of Commerce has not reversed duties imposed to punish Vietnamese shrimp exporters.

Vietnam and six other shrimp-producing nations were named in a petition sent by American shrimp producers to the US Commerce Department two weeks ago. The petition alleged that those countries were receiving billions of dollars in unfair subsidies, threatening the survival of the US industry.

The Commerce Department is expected to decide shortly whether to launch an investigation, which could lead to new punitive duties on foreign imports.