The US Department of Commerce (DOC) has ended a review into whether import duties could be extended to steel traction wheels imported from Vietnam.

The termination leaves in place current tariff structures but underscores the increasing scrutiny over trade remedy evasion in the global steel sector.

In August 2023, the DOC initiated a probe into whether Vietnamese-made traction wheels were subject to existing US anti-dumping and countervailing duties applied to similar products from China. This followed a petition from Dexstar Company, a US manufacturer.

Allegations of Circumvention

Dexstar alleged that Vietnamese producers were using Chinese-origin wheel parts to finish the products in Vietnam, thereby circumventing the duties applied to Chinese goods. However, upon review, the DOC found insufficient evidence that Vietnamese companies had used Chinese discs or rims as components.

While the DOC has closed this specific case, the matter highlights an ongoing concern for US trade officials.

The department noted that interested parties were invited to comment on whether there is enough evidence to open a separate inquiry into potential trade remedy evasion through third-country assembly based on the information in this case.

Potential for Further Investigations

Dexstar maintained its position, arguing that the Vietnamese wheels could be assembled from pre-cut Chinese steel blanks. This suggests a potential for further investigations, focused on evasion methods beyond component sourcing.

Trade battles over steel have been a significant factor in recent US-Vietnam relations. In another recent case, the DOC extended its determination deadline for a probe into alleged tax evasion linked to Vietnamese imports of wooden cabinets.

Solar Industry Tensions

Heightened trade tensions extend beyond steel. The DOC has also confirmed receipt of a request to launch an anti-dumping investigation into Vietnamese producers of solar cells and modules.

These cases illustrate the complex and dynamic nature of trade disputes as global supply chains shift. US officials and businesses are increasingly scrutinizing import flows to identify potential transgressions, raising the prospect of future tariffs or other trade restrictions.