On January 15, 2021, the Office of the United States Trade Representative (“USTR”) published a report detailing the findings of its investigation under Section 301 of the Trade Act of 1974 (“Section 301”) into Vietnam’s currency policies. The report concludes that “Vietnam’s acts, policies, and practices with respect to currency valuation, including excessive foreign exchange market interventions and other related actions, taken in their totality, are unreasonable and burden or restrict U.S. commerce.”  Although such findings permit USTR to adopt measures, such as tariffs, in response to Vietnam’s policies, USTR has declined to take such action at this time.

Continue Reading USTR Finds Vietnam’s Currency Undervaluation To Be Unreasonable And Burden Or Restrict U.S. Commerce, But Delays Responsive Action

On November 24, 2020, the U.S. Department of Commerce (“Commerce”) issued a preliminary affirmative determination in the countervailing duty (“CVD”) investigation of twist ties from China. What is particularly noteworthy about this preliminary determination is Commerce’s decision to countervail the undervaluation of China’s currency, the Renminbi (“RMB”). This marks only the second occasion – following the investigation of Passenger Vehicle and Light Truck (“PVLT”) Tires from Vietnam earlier this year – that Commerce has countervailed a country’s undervalued currency, and the first time it has done so against China. As discussed further below, Commerce’s determination relied on an analysis of the RMB from the U.S. Department of the Treasury (“Treasury”) which differed in meaningful respects from Treasury’s analysis of the Vietnamese Dong (“Dong”) in the investigation of PVLT Tires from Vietnam, suggesting that a less objective, more qualitative analysis may be applied against the RMB in future cases.

Under U.S. law, a subsidy program is countervailable when it meets three criteria. Specifically, the program must constitute (a) a financial contribution provided by a government authority or public body, (b) to a specific firm or industry, that (c) yielded a benefit to the recipient.

The currency undervaluation allegations examined in the PVLT Tires from Vietnam and Twist Ties from China investigations were based on regulations issued by Commerce earlier this year to interpret these terms in the context of currency undervaluation. Regarding the requirement of specificity, Commerce’s new rule provides that enterprises that buy or sell goods internationally (i.e., enterprises in the traded goods sector) may comprise a “group” of enterprises for specificity purposes.


Continue Reading Commerce Takes Action Against Allegedly Undervalued Currencies

The Office of the United States Trade Representative (USTR) has initiated investigations on two trade-related issues with respect to Vietnam under Section 301 of the Trade Act of 1974 (Section 301). The investigations, which were announced on October 2, 2020, will cover Vietnam’s acts, policies, and practices related to (1) the import and use of