VietNamNet Bridge – Many associations still neglect the needs of their members or find it hard to address such needs, heard a workshop on capacity of Vietnamese business associations held on Wednesday.

Associations are meant to represent and protect the interests of their members, but many industry associations, particularly in the export-import sector, have not fulfilled their duties, said Dr. Pham Van Chat, arbitrator of the Vietnam International Arbitration Center.

Sometimes when businesses are faced with lawsuits brought by foreign partners, they ask associations for advice and assistance but in vain, said Chat.

He cited a case in which a Singaporean company required a Vietnamese rice exporter to compensate US$1.4 million. In 2010, the local company cut deal with the Singaporean partner to export rice at a price of US$310 a ton.

However, shortly after that, rice price increased sharply to US$410. The Vietnamese firm was sued at the international court for running short of 11,500 tons.

Getting involved in the lawsuit, Chat tried to contact the chairman of the Vietnam Food Association (VFA) seven times, but he did not succeed. Then, he tried to contract a deputy minister of industry and trade in charge of rice export, but the case was transferred to the Department of Legal Affairs of the ministry and ended in deadlock.

Though the Vietnamese company did not lose the lawsuit, Chat described this as a sad story and an example of how associations fail to do their job.

Dau Anh Tuan, deputy head of the Legal Department of the Vietnam Chamber of Commerce and Industry (VCCI), said that in many cases of anti-dumping and anti-subsidy, most business associations could not assist their members. Only a few associations with experience in anti-dumping lawsuits like the Vietnam Association of Seafood Exporters and Vietnam and the Vietnam Leather and Footwear Association can help their members.

According to many enterprises, associations have yet to act on behalf of the majority of their members. “If associations can only represent a few members or get too close to the State management agencies, they all have problems. An association is healthy when they speak on behalf of the majority of members,” said Tuan.

At the workshop, VCCI published a report on the research titled “Capacity of business associations in Vietnam”. The report presents the overall picture of local associations, said Tuan.

“The Government must quickly issue a law on associations, providing a legal framework for associations, together with a program to help associations improve their capacity, with the ultimate goal of serving development of their members,” he said.

Source: SGT