US keeps tariff on plastic bags

The US continues to impose countervailing duty (CVD) as well as old duty rates on polyethylene retail carrier bags (plastic bags) from Vietnam after the first sunset review on the duty in May, reported Vietnam Competition Authority.

According to the final results of sunset review, the US Department of Commerce held that revoking the CVD on plastic bags from Vietnam was likely to lead to continuation or recurrence of countervailing subsidies.

The tax rate would remain 52.56 percent for Advance Polybag Co. Ltd and 5.28 percent for Fotai Vietnam Enterprise Corp. and Fotai Enterprise Corporation. Meanwhile, all other entities would face a CVD rate of 5.28 percent on the plastic bags exported to the US.

On May 4, 2010, the Department published the order imposing the CVD on plastic bags from Vietnam with tariffs ranging between 5.28 percent and 52.56 percent.

This was the first dual investigation regarding anti-dumping and anti-subsidy mechanisms carried out by the US into exports from Vietnam.

In addition to the CVD, Vietnam exporters also must face anti-dumping duty on the plastic bags they export to the US, levied at rates between 52.3 percent and 76.11 percent.

On April 1, 2015, the Department published a notice of initiation of the first sunset review of the CVD order on plastic bags from Vietnam.

Thirty days after the notice, the Department did not receive substantive responses from the respondent party.

As a result, the Department conducted an expedited (120-day) sunset review into the matter.

According to the Vietnam Plastic Association, Vietnam's plastic products' exports to the US rose by 17.8 percent year-on-year in value, reaching 66.3 million USD in first quarter of 2015. With this, the US became the second largest export market for Vietnamese plastic products.

The US market continues to be not just large but also with potential for further growth for the Vietnamese plastic products, primarily comprising plastic home utensils and bags.-VNA