Academic Activities

UEF Law Faculty Accompanies Students and Businesses Amid Global Trade Fluctuations

19/06/2025

In the context of increasingly complex global trade, major countries such as the United States have stepped up the use of trade defense measures, creating far-reaching impacts on international supply chains, including Vietnam’s. Facing a wave of countervailing duties on imported goods, many Vietnamese exporting enterprises find themselves in a passive position, confronting risks of losing market access and increased cost burdens.

To help students and the business community promptly access policy changes and proactively respond, the UEF Faculty of Law, in collaboration with the UEF Center for Business Cooperation, organized a specialized seminar titled “U.S. Countervailing Duties and Its Consequences for Vietnamese Exports” on the morning of June 19. Led by Lawyer Phan Thi Lieu – Senior Associate and Head of the Tax and Customs Department at Dentons Luat Viet, the program provided in-depth analysis connected with the real-world practices of trade investigations, duty imposition, and response solutions for Vietnamese enterprises in the current volatile environment.

The seminar was attended by Dr. Ngo Minh Hai – Vice Rector; Assoc. Prof. Dr. Duong Anh Son – Head of the Faculty of Law; M.A. Vu Anh Sao – Vice Head of the Faculty of Law; and Dr. Bui Thi Hang Nga – Lecturer of the Faculty of Law.

At the event, Lawyer Phan Thi Lieu presented an overview of the trade defense measures that the United States currently applies, including two main groups: tariff-based measures (anti-dumping duties, countervailing duties, and safeguard measures) and non-tariff measures (quotas, import licensing, technical standards, origin regulations, administrative procedures, etc.). Among these, countervailing duties have emerged as a strong tool used by the U.S. against countries whose policies are viewed as threatening its economic security.

From a legal perspective, Executive Order 14257, issued by the U.S. President on April 2, 2025, established a new framework for applying countervailing duties. The legal basis cited includes Section 232 of the Trade Expansion Act of 1962 and the International Emergency Economic Powers Act (IEEPA), emphasizing behaviors considered threatening to the system, such as government subsidies, currency manipulation, or excessive reliance on state-owned enterprises. Vietnam is among the countries targeted under this policy.

According to the analysis, the level of U.S. countervailing duty applied to Vietnam could reach 46%, calculated based on the trade deficit ratio between the two countries. Specifically, in 2024 Vietnam imported $16.5 billion worth of goods from the U.S. while exporting $136.5 billion, resulting in a trade surplus of 90%. The countervailing duty was set at 50% of the deficit ratio – equivalent to 45%, plus other adjustments leading to a total duty of 46%.

This situation carries significant consequences for Vietnamese companies. First, it reduces competitiveness compared to countries not subject to these duties. Additionally, exporters may face supply chain disruptions, loss of orders, and loss of market share in the U.S. Beyond that, businesses also encounter legal risks, such as being sued, having to comply with strict origin verification requirements, and facing strong pressure on cash flow due to rising costs and falling revenue. The domestic market is also affected when exported products return for local consumption, causing pressure on inventory levels and selling prices.

Industries at high risk of being affected by countervailing duty policies include aluminum, steel, plywood, textiles and garments, and many products not listed in Appendix II of the Executive Order – a category that is exempt from countervailing duties. This serves as a serious warning to Vietnamese exporters selling to the U.S. market.

In response, Lawyer Phan Thi Lieu also offered practical recommendations to help Vietnamese companies proactively cope. Specifically, companies should carefully analyze the affected HS codes, monitor investigation developments, prepare detailed origin verification documentation, and maintain transparency in cost structures. If possible, they should apply for product exclusion from the duty list. Additionally, adjusting the supply chain, changing the country of origin, or sharing costs with U.S. import partners are options worth considering. Furthermore, companies should consider expanding into other markets, and leveraging free trade agreements such as CPTPP, EVFTA, and RCEP to offset losses.

With the goal of supporting the Vietnamese business community in enhancing their ability to adapt and respond to legal risks in international trade, the seminar at UEF helped spread valuable information and equipped learners with a realistic perspective on global trade. This event also demonstrated UEF’s commitment to integrating academia, practical relevance, and business engagement in its ongoing efforts to train future internationally integrated human resources.