Southern Shrimp Alliance

Commerce Discontinues Use of Bangladeshi Wage Rates to Value Vietnamese Labor Costs in Shrimp Antidumping Duty Proceedings

June 29th, 2017
Today, the U.S. Court of International Trade issued a decision affirming the U.S. Department of Commerce’s determination to abandon the use of wage rates from the Bangladeshi shrimp processing industry to value labor costs for Vietnamese shrimp processors in its calculation of antidumping duties for Vietnamese shrimp.

Because Vietnam is not a market-based economy, Commerce is required to look to countries with market economies at similar levels of economic development to ascertain what costs would be like for Vietnamese shrimp producers if they operated in a market environment.  For most of the antidumping duty proceedings related to Vietnamese shrimp, Commerce has used costs from Bangladesh.

The Ad Hoc Shrimp Trade Action Committee has repeatedly challenged the use of Bangladeshi wage rates to value Vietnamese shrimp processing costs, arguing that the documented widespread abuse of labor in the Bangladeshi shrimp industry, as well as U.S. government actions in response to that abuse, render these values aberrational and not representative of what labor costs would be like if Vietnam operated a market economy.  Commerce had rejected this argument at the agency level, but after appeals by the Ad Hoc Shrimp Trade Action Committee to the U.S. Court of International Trade, the agency was ordered to reconsider its reliance on Bangladeshi wage rates.

Upon reconsideration, Commerce determined that in light of the evidence placed on the administrative record by the Ad Hoc Shrimp Trade Action Committee, the agency would no longer use Bangladeshi wage rate data and would, instead, rely on Indian wage rate data to value Vietnamese shrimp processing labor costs.  In the decision issued today, the Court found that Commerce’s redetermination complied with its prior order and sustained the agency action.

Because of the Court’s decision, the duty assessment rate on Vietnamese shrimp imports entered into the United States between February 1, 2013 and January 31, 2014 – the ninth administrative review period – increased from 1.16 percent for shrimp from Thuan Phuoc Seafoods and Trading Corporation to 1.42 percent and from 0.91 percent for shrimp from all Vietnamese companies that qualified for a separate rate to 1.05 percent.
Commerce is currently considering the same issue in the context of Vietnamese shrimp imports entered into the United States between February 1, 2012 and January 31, 2013, following an order from the U.S. Court of International Trade requiring the agency to review its reliance on Bangladeshi wage rates in that proceeding as well.

Read the U.S. Court of International Trade’s decision in Ad Hoc Shrimp Trade Action Committee v. United States, Slip Op. 17-76 (June 29, 2017) here: http://www.shrimpalliance.com/wp-content/uploads/2017/06/AHSTAC-Final-Decision.pdf