U.S. Tariffs at 107% on Italian Pasta? Another episode in the saga of exporting to the United States

8. Oktober 2025

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It is quite common for business relationships with agents or distributors to last for years without any signed documents. And be careful, because we know that a contract can exist even verbally.

The absence of a written contract will add difficulties in the event of a possible claim, so what you do between the decision to terminate, and the moment of the claim is very important. Remember: ‘anything you write will be used against you’.

The decision to terminate a business relationship is a very delicate moment to which, for some reason, solicitors are not invited. Here are some examples (all real) in which companies or employees with the best of intentions wrote to the agent/distributor. All of them were subsequently very damaging to the company:

Saying ‘We are terminating our business relationship’ when the strategy will be to argue that no such business relationship exists, but rather that there are separate and linked contracts (e.g., supply rather than ongoing distribution contract; very significant compensation consequences).

‘You no longer represent our company’, which may be evidence that you did so before.

‘As of day X, you may no longer act on behalf of our company,’ which would prove that you were previously able to act on its behalf.

‘You may not attend the X trade fair on our behalf.’ A way of confirming that the agent/distributor’s responsibilities included participating in trade fairs and probably accrediting the customers obtained.

‘The sales you promoted have been significantly reduced in year N.’ When there is no written contract or other form of documentation, imputing a breach of an obligation that is not clear can be counterproductive.

Saying ‘You are not actively promoting our products’ and then adding: ‘We urge you to stop promoting the sale of our products’.

‘You are no longer our exclusive representative’, which proves a type of relationship (representation/agent) and a tacit or express agreement (‘exclusivity’).

‘We have appointed another representative in your area’, which shows that the agent/distributor had an assigned area and was “representing”.

‘From this moment on, orders will be handled by X’, which also confirms a type of relationship.

 

In summary: from the moment the company considers terminating a commercial relationship, especially when it is not in writing and before sending any letter, it is advisable to think carefully about the strategy in case of a possible claim. This is the best time to seek advice and avoid surprises. Any communication that is not in line with this strategy designed from the outset can only lead to confusion and problems.

Remember the USA – EU agreement on 15% tariffs? I wrote that with a negotiator like Trump the game is never over (article here) and—after the recent interlude featuring a threat of 100% tariffs on pharmaceuticals—the U.S. government has announced the imposition of an overall 107% duty on Italian pasta, which could take effect on January 1, 2026.

Where this new duty comes from

The antidumping investigation was launched by the U.S. Department of Commerce at the request of certain competing American companies and is based on a 1996 antidumping order that allows for periodic reviews of imports of Italian pasta. The Department of Commerce conducts these checks annually to assess whether Italian producers are selling pasta at prices lower than the U.S. domestic market, a practice known as “dumping.”

Companies involved in the investigation

The Department of Commerce selected two sample companies for in-depth analysis, defined as “mandatory respondents”: La Molisana and Pastificio Lucio Garofalo. According to the official document published by the U.S. administration, for the period from July 1, 2023 to June 30, 2024, both companies allegedly sold their products below market prices, resulting in the imposition of a duty of 91.74%.

U.S. authorities justified this percentage by claiming the two companies did not provide complete or compliant information as requested by the Department and were therefore insufficiently cooperative during the investigation. What is very important is that, in addition to the two companies directly examined, the additional 91.74% duty is also applied to numerous other Italian producers not individually reviewed. This methodology, while formally permitted under U.S. law as an exception, is being applied without any direct verification of the other companies.

Next steps in the procedure

Italy’s Ministry of Foreign Affairs moved immediately, formally intervening in the proceeding as an “interested party” through the Italian Embassy in Washington. The Foreign Ministry is working in close coordination with the companies concerned and, in concert with the European Commission, to persuade the U.S. Department to revise the provisional duties.

The two companies involved (La Molisana and Garofalo) can submit documentation to contest the dumping allegations. However, if dumping is confirmed, the Department of Commerce will instruct Customs to apply antidumping duties on goods sold and entered into U.S. commerce.

The preliminary nature of this determination means there is still room to change the decision before it becomes final.

Possible effective date

The new super-duty of 91.74%, which will be added to the existing 15% tariff for a total of 107%, is scheduled to take effect on January 1, 2026. This date therefore represents a crucial deadline for all ongoing diplomatic and legal actions.

If confirmed, the economic impact would be significant: in 2024, Italian pasta exports to the United States reached a value of €671 million according to Coldiretti, accounting for nearly 17% of the sector’s total exports. A 107% duty would risk seriously undermining competitiveness in one of the most important markets for Italian agri-food products.

 What to do between now and January 1, 2026?

At this stage, the entry into force of the new duty depends on the outcome of the ongoing procedure: given what has happened in recent months, and the political use the U.S. administration has made of tariffs—well beyond their technical function—it is reasonable to be pessimistic.

So, what to do? In recent months we have seen companies react to the uncertainty over the fate of the tariffs in three ways:

  • Some rushed to ship as many products as possible before the potential effective date of the duty;
  • Some granted—upfront—discounts equivalent to the threatened duty, in case it came into force;
  • Some suspended orders, pending definitive news on the impact of the duties.

These are all  valid options, but other effective tools for managing the uncertainty caused by the flurry of announcements, negotiations, and threats from the U.S. administration should not be forgotten: the risk of new duties being introduced, or existing ones being increased, can be managed in the contract by agreeing with the U.S. importer how any tariff change will affect the product.

The parties can stipulate, for example, that the increase will be split equally; or that the importer will bear it beyond a certain threshold; or that if the duty exceeds a certain level, the contracts may be terminated. You can find a deeper dive in this article.

The only certainty is that trade relations with the U.S. will stay unpredictable for a long time, and it’s vital to carefully manage the risk factors involved in selling products there. Right now, the focus is on tariffs and prices, and I encourage you to take this chance to thoroughly review existing agreements and assess whether—and how—other important points are addressed that could entail significant liabilities: we discuss them, very practically, in this book.

On 29 June 2025, the Vietnamese government introduced Decree No. 163/2025/ND-CP (Decree 163). This decree provides detailed guidance on how the updated Law on Pharmacy will be implemented.

Like the amended Law on Pharmacy, Decree 163 came into effect on 1 July 2025, replacing the previous Decree No. 54/2017/ND-CP (Decree 54). The new decree sets out comprehensive rules for key aspects of managing pharmaceuticals, including:

  • Pharmacy practice certificates
  • Certificates allowing pharmaceutical businesses to operate
  • Import and export of medicines and drug ingredients
  • Good Manufacturing Practice (GMP) inspections of overseas manufacturers
  • Recalling medicines and drug ingredients
  • Certificates for medicine advertising content
  • Medicine price management

Key Changes in Decree 163

Here are some important changes and additions introduced by Decree 163:

Destroying Specially Controlled Medicines

You no longer need to get approval from the relevant authority before destroying narcotic, psychotropic, and precursor drugs, or pharmaceutical ingredients that are narcotic or psychotropic substances or precursors used in medicines. Instead, you just need to provide notification at least seven working days in advance. This notification must include the planned destruction date and a detailed list of items to be destroyed.

E-commerce in Pharmaceutical

Pharmaceutical businesses that sell products online must openly display the following information to ensure transparency and consumer safety:

  • Their certificate allowing them to operate as a pharmaceutical business.
  • The pharmacy practice certificate of the person responsible for pharmaceutical expertise.
  • Information about the medicines themselves.

Shelf-Life Rules for Imported Products

For medicines and ingredients with a total shelf life of nine months or less, at least one-third of their shelf life must remain when they clear customs. Medicines with a shelf life of 30 days or less must still be within their shelf life at the time of customs clearance.

Controlling Imported Products

All medicines with marketing authorisation (MA) are subject to import control, except for:

  • Medicines needed for preventing and treating Group A infectious diseases that have been declared epidemics, as per the Law on Prevention and Control of Infectious Diseases.
  • Medicines with a shelf life of less than 30 days.

Importers must inform the provincial People’s Committee at least five working days before making a customs declaration. The People’s Committee can then issue a written notice of non-compliance to the customs authority within five working days of receiving this notification.

Medicine Advertising

Decree 163 adds a process that allows an approved medicine advertising certificate to be adjusted for certain changes (such as a change to the MA holder or manufacturer information). This means you don’t have to go through the entire initial registration process for medicine advertising content again, as was required under the previous rules.

Medicine Price Management

Businesses must announce or re-announce wholesale prices, similar to the medicine price declaration process under Decree 54. Some medicines are exempt from this requirement, including those provided free of charge for emergency responses, national health programmes, humanitarian aid, clinical trials, scientific research, or exhibition purposes, and medicines carried as personal luggage.

The Ministry of Health (MOH) can make recommendations if the announced or re-announced price is significantly higher than similar medicines already on the market. This includes situations where:

  • The announced or re-announced wholesale price of the medicine is higher than the highest price of similar medicines.
  • The price difference is more than 35% (for medicines priced under VND 1 million) or 15% (for medicines priced at VND 1 million and above) compared to winning bid prices in tenders.
  • The announced or re-announced price is higher than prices in the country of origin or other markets (if there’s no similar product in Vietnam).
  • When such differences are found, the MOH issues a formal recommendation to the announcing business and publishes it online for transparency and accountability.

Further Guidance in New Circular

On 1 July 2025, the MOH issued Circular No. 31/2025/TT-BYT (Circular 31), which further details how the amended Law on Pharmacy and Decree 163 should be implemented. Circular 31 officially replaces Circular No. 07/2018/TT-BYT and Decree 54 and came into effect immediately.

Key provisions of Circular 31 include:

Notification of Practising Pharmacists

Pharmaceutical businesses that are not part of a pharmacy chain must inform the relevant authority of a list of people currently working at the business who hold pharmacy practice certificates. This notification must be submitted within 15 days of the date the certificate allowing the pharmaceutical business to operate was issued, or when there are any changes to the list. This is a shorter deadline than the previous 30 days under earlier rules.

Pharmacy chains have similar notification duties and deadlines. Specifically, the chain operator must inform the provincial authority where each pharmacy in the chain is located about the list of practising pharmacists at those sites. Additionally, pharmacy chains must notify the authority if pharmacies are added or removed from the chain, and if there are any rotations of the people responsible for pharmaceutical expertise between pharmacies within the chain.

Medicine Information Activities

Under Circular 31, medicine information can still be given to healthcare professionals through information materials, seminars, and medical representatives.

However, Circular 31 introduces a significant change by removing the need to obtain a certificate for medicine information content before carrying out these activities. Under the new rules, pharmaceutical businesses, representative offices of foreign pharmaceutical companies in Vietnam, and MA holders are now responsible for creating and distributing medicine information materials. These materials must comply with the package inserts for medicines approved by the MOH, the Vietnamese National Drug Formulary, and any related documents and professional instructions issued or recognised by the MOH.

Donald Trump, never one to shy away from drama or diplomacy-via-caps-lock, has slapped a 50% tariff on all Brazilian exports to the United States. The justification? In his own delicate prose: „The treatment of former President Jair Bolsonaro is a disgrace… A witch hunt that must end IMMEDIATELY!“

And just in case anyone thought this was about trade imbalances or economic strategy, Trump made things crystal clear: „Due to Brazil’s insidious attacks on free elections…“.

In short, the 50% tariff isn’t about coffee, orange juice, or flip-flops. It’s about a Supreme Court judgment, applying Brazilian law, regarding Brazilian politicians accused of conspiring in a coup d’état. In other words, this is a brazen (and frankly absurd) attempt at judicial intervention via trade war.

Trump, with his characteristic subtlety, offered a solution: manufacture in the U.S., and he’ll look kindly upon Brazil, like a mafia don offering „protection“ after smashing your shop window. But what he meant was: consider Bolsonaro innocent, and we’ll talk.

The Brazilian market took the bait

Although the fishy interference in Brazilian affairs was determined from a fish out of the water, the market took the bait: in the first 48 hours after the infamous letter, at least 1500 tons of fish were already held in Brazilian ports, as US buyers suspended their contracts due to uncertainty about the costs upon arrival. The fish market is on alert, as 80% of the exports head to the US, mainly coming from small family-owned industries that distribute the catch from artisanal fishing communities.

The same effect hit other sectors, from orange, honey, and coffee to aircraft.

Brazil’s response and sorcery: don’t mess with us (or our weather)

Naturally, Brazil will not sit quietly sipping caipirinhas while its sovereignty is trampled. Reciprocity is on the table: if Washington raises tariffs, Brasília can do the same. But above all, one thing is sure: Brazil will never tolerate foreign interference in its independent judiciary.

And then, a curious coincidence: right after Trump’s speech, a tornado accompanied by lightning struck the White House grounds. Pure chance? Maybe. Or could it have been the work of Brazilian indigenous shamans, a particularly well-organized group of umbanda practitioners, or simply the fact that, as every Brazilian child knows, God is Brazilian.

Trump might want to check the weather forecast next time before penning another angry letter.

The unpredictable becoming predictable

Trade wars are rarely tidy affairs, but one thing they consistently deliver is chaos (in legal terms, disruption). And when disruption meets contracts, force majeure disputes often end up in court.

At first glance, Trump’s decision to impose a 50% tariff overnight might feel like an unpredictable thunderbolt (quite literally, given the weather at the White House). But here’s the catch: by now, unpredictable tariffs are becoming predictable. When a government with a well-documented love for impulsive economic diplomacy imposes politically motivated tariffs, can anyone claim to be surprised?

In most jurisdictions, force majeure requires that the event be extraordinary, unforeseeable, and beyond the parties’ control. A sudden 50% tariff certainly ticks a few of those boxes, but following a repetition of erratic trade policy, one might argue that businesses should expect what in past times was considered unexpected, especially when dealing with certain jurisdictions or political figures. In other words, Trump’s tariffs might not excuse performance if parties didn’t prepare for exactly this kind of volatility.

This is where good contract drafting comes into play

Savvy businesses are learning that their contracts must go beyond a vague boilerplate clause about “acts of government” or “changes in law.” Instead, they should expressly address the risk of sudden tariff changes, including

  • hardship clauses that allow renegotiation when costs become commercially unreasonable;
  • price adjustment mechanisms linked to tariff thresholds;
  • termination rights triggered by specified levels of customs duties;
  • currency fluctuation provisions (because tariffs rarely travel alone, and currency swings often accompany them).

In short, while no contract can immunize a business from every shock, smart drafting can mean the difference between a commercial headache and a catastrophic breach.

Therefore, tariffs may no longer be an unpredictable storm; they are part of the new predictable landscape. Given that your contract might wake up tomorrow facing ‘IMMEDIATE’ punitive tariffs in all caps, your contract should be ready today.

The unwitting cupid: strengthening EU-Brazil relations

While the tariffs may ruffle trade flows between Brasília and Washington, there’s an unintended silver lining: Trump is proving to be the most efficient matchmaker between Brazil and other markets, such as China and the European Union.

The EU-Brazil relationship, already a flirtation with promising prospects, with relevant progress in the EU-Mercosur Agreement, now seems destined for deeper romance. If Mr. Trump insists on isolating the US from Brazil, the old continent stands ready, with flowers and wine in hand, to pick up where the US left off. After all, Brazilian fish can pair up nicely with champagne, cava and prosecco.

So thank you, Mr. Trump. In your quest to bully Brazil into submission, you may have done more to strengthen transatlantic ties than any EU Commissioner ever could. As they say in Brasília these days: Trump is not a trade warrior. He’s a cupid in disguise.

The recent announcement of a landmark trade agreement framework, following just three months negotiations since President Trump’s tariffs announcement on 2 April 2025, signals a pivotal shift, not merely in bilateral relations, but in the broader architecture of global supply chains.

As a commercial lawyer with exposure to Vietnam since 2007, I have observed the evolving dynamics between the United States and Vietnam through the years, talking to students, entrepreneurs, veterans, diplomats, humans from all walks all life, from both nations and beyond.

You may recall that Vietnam, with the notable exclusion of China, was to be the nation that would encounter the most stringent tariffs imposed by the Trump administration, reaching an astonishing 46%.

The newly forged framework outlines significant reciprocal concessions designed to foster greater trade and investment flows. Granted, pre-April 2 tariffs applied by the USA on Vietnamese goods were lower than what emerges from the framework agreement, but still, it is better than 46%),

The United States has committed to imposing a 20% tariff on most Vietnamese imports, a notable reduction from the previously mooted 46%. However, a substantial 40% tariff will apply to goods re-exported from third countries, with a particular focus on those originating from China.

Vietnam has pledged to open its market to a wide array of US products. Crucially, it has also committed to implementing stringent measures aimed at restricting the transshipment of Chinese goods through its territory, a long-standing concern for Washington.

In a significant win for American exporters, US goods will now enjoy duty-free access to the Vietnamese market, effectively granting “total access”, particularly for large-engine vehicles such as SUVs, as emphatically stated by President Trump (how SUVs are going to circulate in the narrow alleys of Hanoi and Ho Chi Minh City, infested by swarms of mopeds, is a different story).

This agreement is expected to catalyse growth in several key sectors. Electronics, textiles, furniture, energy (especially Liquefied Natural Gas), and agriculture are poised for expansion. US firms specialising in manufacturing technology, energy solutions, and agricultural products are anticipated to be the primary beneficiaries. Furthermore, beyond immediate trade benefits, the agreement is set to reshape investment strategies, encouraging a greater localisation of supply chains within Vietnam. This strategic realignment is also expected to further solidify the already robust US-Vietnam Comprehensive Strategic Partnership.

While the potential upsides are considerable, it is imperative for businesses and investors to approach this new landscape with a clear understanding of the accompanying risks. From my vantage point, I identify several significant execution challenges and structural impediments that require close monitoring.

Enforcement of Transshipment Controls

The most immediate and perhaps formidable risk lies in the effective enforcement of transshipment controls. Vietnam has historically served as a significant assembly point for Chinese-manufactured components. Ensuring that goods originating from China are not merely re-routed through Vietnam to circumvent US tariffs will require exceptionally close monitoring and robust verification mechanisms. The legal and practical complexities of definitively determining the true country of origin for all goods will undoubtedly pose a persistent challenge. As a European citizen, witnessing how the EU-Vietnam Free Trade Agreement (“EVFTA”), which poses an important stress on certificates of origin, I am particularly aware of this matter.

While Vietnam has made remarkable strides in its economic development, certain structural issues could hinder its capacity to scale up high-value manufacturing in the short to medium term. These include:

Legal framework nuances

Vietnam’s legal framework for foreign investment has seen continuous improvements, but legal and cultural complexities and inconsistencies can and do still arise. Navigating the regulatory landscape, particularly with new rules stemming from this agreement and at a time of deep administrative, governmental, digital and legal reforms in Vietnam, will demand expert legal guidance to ensure compliance and mitigate potential fines and disputes. Issues surrounding so-called sublicences for businesses, intellectual property rights enforcement and contract enforceability, whilst improving, still require careful consideration;

Education

The ambition to transform Vietnam into a high-value manufacturing hub necessitates a workforce equipped with advanced skills. While the Vietnamese government prioritises education and workforce development, a significant portion of the current labour force lacks formal training and specialised certifications, let alone a good command of the English language. Bridging this skills gap, particularly in areas like advanced manufacturing, engineering, and digital technologies is a necessity and not just in light of this framework agreement. Companies may need to factor in substantial investment in training and upskilling programmes for their Vietnamese employees.

Infrastructures

Despite considerable investment, Vietnam’s infrastructure, particularly in logistics, energy, and transportation, continues to face bottlenecks. And China – the apparent target of Trump’s tariffs – is stepping in with high-speed trains connecting it to the northern Provinces of Vietnam. An increased volume of high-value manufacturing and trade will place further strain on existing infrastructure. Inadequate port capacity, congested roads, and a reliable energy supply (including for EV charging) are critical concerns that could impact efficiency and increase operational costs for businesses.

Policy divergence

This framework agreement deepens US-Vietnam trade ties and seems to be paving the way for more US investments in Vietnam, but this second aspect seems to run counter to parallel US policy objectives aimed at reshoring manufacturing back to the United States. This potential divergence in strategic priorities could introduce yet another element of unpredictability in the long term, necessitating a flexible and adaptable investment approach. Future shifts in US policy could impact the durability and full extent of the benefits derived from this agreement.

This trade agreement, if finalised and implemented, undoubtedly represents a structural shift in global trade dynamics. It strategically positions Vietnam as an increasingly important high-value manufacturing hub and significantly deepens US engagement in Southeast Asia. We will need time, however, to assess the practical impact of the agreement, observing the efficacy of its implementation, and understanding how Vietnam’s inherent strengths and challenges will ultimately shape its role in the reconfigured global supply chain.

We will also need to see what China, if anything, will do as a countermeasure. In fact, any assessment of Vietnam’s evolving trade landscape would be incomplete without a thorough consideration of China’s influence and strategic posture. President Xi Jinping has consistently championed a vision of a “community of shared future for mankind,” a concept that, while outwardly promoting global cooperation, also subtly underscores a demand for international alignment with Beijing’s interests. In the context of escalating trade tensions, Xi has repeatedly warned that “trade wars have no winners,” advocating for unity against protectionist measures, yet simultaneously implying that nations must ultimately choose sides, either with or against China’s economic and political orbit. Vietnam, despite its historical complexities and occasional maritime disputes with Beijing in the South China Sea (or East Sea, as it is officially called by Hanoi), remains deeply interwoven with China’s economy. China has been Vietnam’s largest trading partner for many years, with significant inflows of Chinese FDI, loans, and project contractors. This economic dependency is particularly evident in various sectors, where Chinese components and materials form a substantial part of Vietnamese manufacturing supply chains. While Vietnam has actively sought to diversify its trade partners and reduce its reliance on China, the sheer scale of the bilateral economic relationship means that disentanglement is a long-term, complex endeavour. Furthermore, China’s influence extends beyond direct trade into crucial regional resources. The Mekong River, a lifeline for millions in Southeast Asia, originates in China, which has constructed numerous upstream dams.

As Vietnam navigates its enhanced trade relationship with the United States, it must simultaneously contend with the enduring economic gravity and strategic ambitions of its northern giant neighbour. Any perceived move by Vietnam to significantly shift away from China could invite retaliatory measures or heightened pressure from Beijing. Businesses investing in Vietnam must not only grasp the intricacies of the US-Vietnam agreement but also meticulously analyse how these developments will intersect with, and potentially be impacted by, the intricate, often delicate, and sometimes fraught relationship between Hanoi and Beijing. Understanding this geopolitical tightrope will be essential for sustainable success in the Vietnamese market. Prudence, informed legal counsel, and a keen eye on evolving geopolitical and economic realities will be paramount for those seeking to capitalise on this transformative new chapter.

Takeaways

  • Tariffs:The US-Vietnam framework agreement marks a significant departure from previous trade dynamics, reducing US tariffs on most Vietnamese imports to 20% (from a mooted 46%) while imposing a 40% tariff on transshipped goods, especially from China.
  • Vietnam’s market opening:Vietnam has committed to duty-free access for a broad range of US products and stricter controls on Chinese goods transiting its territory.
  • Growth / manufacturing shift potential:The agreement is expected to fuel expansion in Vietnamese electronics, textiles, furniture, energy (LNG), and agriculture. It also encourages supply chain localisation within Vietnam (normally more of an assembly point for Chinese products).
  • Execution challenges: Effectively preventing the re-routing of Chinese goods through Vietnam to avoid tariffs will be a complex and demanding task; Despite economic progress, Vietnam faces hurdles in scaling high-value manufacturing due to legal framework nuances (e.g., sublicences, IP enforcement), a skills gap in its workforce (lack of formal training, English proficiency) and infrastructure bottlenecks (logistics, energy, transportation).
  • US policy divergence:The agreement’s encouragement of US investment in Vietnam appears to contradict the broader US policy objective of reshoring manufacturing.
  • China:Businesses must consider China’s significant economic sway over Vietnam, including its position as Vietnam’s largest trading partner, its FDI, and its control over shared resources like the Mekong River. Any major shift by Vietnam away from China could lead to retaliatory measures from Beijing.
  • Uncertainty:This is not a final agreement, so the situation might change. Prudence and informed legal counsel are crucial for businesses navigating this evolving landscape.

The Trump approach: power and dominance

In his autobiography, The Art of the Deal, Donald Trump describes negotiation as a contest of strength, determination, and dominance. His vision is clear: anyone who shows uncertainty or makes concessions too early is immediately perceived as a loser. His negotiating style is based on constant pressure, maximalist demands, and calculated threats, to obtain unilateral advantages. In this scheme, compromise is not a point of arrival, but a sign of weakness to be avoided.

Trump has always been a competitive negotiator, focused on immediate results and uninterested in balanced solutions unless they are strictly functional to his interests.

Other negotiating styles: compromising and collaborative

In contrast to this competitive approach, there are two other relevant negotiating styles:

  • The compromising style aims to reach a ‘middle ground’ agreement, in which both parties give something up to achieve an acceptable solution. It is a pragmatic approach, practical in situations where time is limited or positions are too far apart for genuine collaboration.
  • The collaborative style, on the other hand, aims to create win-win solutions. The parties seek to thoroughly understand each other’s interests and work together to build an outcome that maximizes the benefit for both. It requires openness, time, and trust.

In commercial negotiations, the compromising or collaborative approach can only work if the other party shares the same logic. But when dealing with an explicitly competitive actor such as Trump, adopting a compromising style risks seriously penalizing the other party, for at least three reasons:

  • It conveys weakness

An accommodating gesture is seen not as a sign of openness, but as a point of pressure to be exploited. The competitive negotiator, focused on gaining an immediate advantage, interprets it as a willingness to give even more.

  • It relinquishes bargaining power

The EU has a vast market and significant trade levers, especially in a context where the US is closing the door to the Chinese market. Offering concessions at the outset is tantamount to burning your cards without getting anything in return. In a competitive confrontation, the first move can set the tone for the negotiation: once a concession has been made, it is very difficult to backtrack.

  • It legitimizes the negotiating imbalance

An unbalanced compromise, if accepted without resistance, risks becoming the new basis for future trade relations, systematically penalizing the EU in subsequent rounds.

Why 30%? The anchor technique

Trump often uses a negotiating technique known as the anchor technique. This consists of deliberately setting a very high target at the beginning of the negotiation (in our case, the threat of 30% tariffs).

The aim is to create a psychological perimeter for the negotiation and force the other party to reason on the basis of that figure, even though they are aware that it is arbitrary. This technique allows one to influence the scope of the discussion and obtain greater concessions, just as Trump has done.

The worst response: unilateral concessions with no return

Unfortunately, the European Union has already shown worrying signs of a compromising attitude that has not been negotiated with the Trump administration, for example:

  • The waiver of the web tax* on American digital giants, without obtaining any regulation or shared tax contribution in return.
  • The offer to increase imports of liquefied natural gas (LNG) from the US, made to reassure Washington, without obtaining anything in return.
  • The acceptance of the increase in NATO spending to 5% of GDP, demanded by Trump, again without obtaining anything in return.

All these offers without asking for anything in return reinforce the idea that the EU is willing to concede from the outset. Trump, true to his competitive logic, sees these concessions as a starting point, not a compromise: this pushes him to raise his demands, not moderate them.

Persevering would be a fatal mistake

Continuing along this path of compromise, in the hope that accommodation will ease the pressure, would be not only ineffective but counterproductive. With a competitive negotiator, unilateral concessions do not stop escalation: they fuel it. Any sign of weakness is interpreted as additional room for maneuver.

A helpful example is China’s reaction during the trade war initiated by Trump. Faced with massive tariffs imposed by the US, Beijing responded in kind, imposing equivalent tariffs. Instead of giving in, it spoke the same language of power. The result is there for all to see: after weeks of escalation, the US had to moderate its position, opening up to a more balanced agreement.

The right strategy: speak his language

To avoid the mistakes of the past, the EU should therefore reverse its negotiating logic. Not to fuel confrontation, but to restore a credible balance. Some applicable countermeasures could be:

  • Target Trump’s electoral base, particularly the agricultural sectors (soy, corn, beef), with selective tariffs or targeted restrictions.
  • Put the European web tax* back on the table, even with a minimum rate, linking any exemptions to real concessions from the US.

These well-calibrated moves would strengthen the EU’s position and show that it can defend its interests by speaking a language Trump understands: that of strength and bargaining power.

Going beyond requests, seeking the other party’s interests

A fundamental principle in any negotiation is to identify the other side’s interests and find a way to allow them to achieve them without sacrificing your own. This is no easy task, given Trump’s notorious volatility and the lack of sound arguments to justify the demands made in the negotiations.

In the case of the EU-US negotiations, it must be borne in mind that Trump is playing the game with his electoral base in mind: an agreement must offer him a narrative of victory to communicate to his electorate.

Takeaway

When negotiating with a competitive player like Trump, one should abandon the accommodating approach, avoid concessions without something in return, and adopt a style that is more assertive, strategic, and symmetrical.

Only then will it be able to build an agreement that is solid, fair, and respectful of its economic and political strength.

I have often dealt with commercial distribution agreements between Italian and Chinese companies, sometimes following negotiations in the wine sector for various types of agreements: sales, distribution, franchising, establishment of joint ventures, and sales through online stores.

I am sharing some key considerations for approaching this complex but opportunity-rich market.

📌 Here are my 10 takeaways

Step Zero. Protect your IP

it is essential to protect your intellectual property before entering China. This includes trademarks (including their Chinese transliteration), labels, web domains, and social media accounts. Neglecting this aspect can have disastrous consequences, exposing you to the widespread phenomenon of trademark squatting (even famous names such as Michael Jordan, Elon Musk, and Donald Trump have fallen victim to this).

For more information, you can read this article about Intellectual property protection in China

1 – Know your enemy

trust is good, but mistrust is better. Before entering into commercial agreements, it is essential to check the credentials of potential partners through the databases of the State Administration for Industry and Commerce. When it comes to wine, it is necessary to check whether the prospective distributor has a license to import and distribute wine.

2 – No copy-paste

 Contracts must be tailor-made, adapting them to local specificities. In particular, it is crucial to clearly regulate promotional activities: budget, commercial actions, communication methods, and management of the producer’s trademarks. It is also best to write the contract in Chinese to ensure that there are no misunderstandings and in case it needs to be used before a judge or local administrative body, as Chinese is the only official language. (N.B.: if you think of entrusting the task to ChatGPT, this is not a good idea).

For an in-depth article, check out The commercial distribution contract in China

3 – Decide immediately how and where to litigate

It may seem counterintuitive, but it is best to avoid providing for Italian (or French, or German) jurisdiction and applicable law, which is an ineffective solution, especially in cases where urgent action is needed to stop unfair competition or counterfeiting. Consider applying Chinese law and provide for an arbitration clause at CIETAC. An effective dispute management strategy is a key element of the agreement and must be negotiated carefully. (P.S.: This applies not only to China but to all international agreements. For more information, see this article).

4 – China is big

And it is the sum of many very different internal markets. Exclusivity should be granted for good reasons, but only if the distributor has a well-developed commercial network and can achieve specific shared objectives. If granted, it should be limited to the province where the distributor is based and subject to the achievement of agreed sales volumes. Having a single distributor for the whole of China is like entrusting an Italian distributor with promoting a product throughout Europe. Or appoint a NYC-based company to promote and sell your wines in all 50 US States.

5 – China is far away

Delegating everything to the local distributor and taking no interest in what is happening on the Chinese market is never a good idea. Firstly, because you have no idea how, where, and with what results the wines are being sold. Secondly, because you cannot verify compliance with agreements, for example on non-competition or the use of trademarks. It is therefore important to schedule meetings to share commercial policies and be able to verify what is happening, including through audits and visits to warehouses and the sales network.

6 – China is expensive

Competition in the Chinese domestic market is fierce. This is also true in terms of price, as some countries that are direct competitors of Italy (Australia, Chile, New Zealand) have free trade agreements and can therefore enter the market on more favorable terms than Italian wine, which is subject to a total tax burden of around 43% after payment of duties, excise taxes, and VAT. It is necessary to position oneself in the right market segment (medium-high), and to do so, it is necessary to plan the right commercial actions together with the distributor. Selling Ex-Works and hoping that the distributor will take care of everything is not an excellent strategy for being competitive.

7 – China is dangerous

Scams are always around the corner. In the wine world in particular, for example, spontaneous expressions of interest are frequent, arriving via the company website, social media accounts, or directly via email. They sound like this: we have discovered your wines, we think they are fantastic, we want to place an order immediately. If it sounds too good and easy, it is certainly a scam. There is an easy way to check: if the next step is a request for payment of a few thousand euros, justified by the need to register the wines on the CIFER (China Imported Food Enterprise Registration) portal, or to register your trademark to prevent others from doing so, or to authenticate the signature on the sales contract… these are attempts at fraud, and the elusive order will never arrive after payment has been received. How can you check whether the person you are dealing with is a reputable company or a fraudster? 👉🏼Go back to point 1 (here is an in-depth article).

8 – E-commerce? Yes, but with method (and money)

Online wine sales continue to grow, but entering large platforms is complex, competition is fierce, and running an online store requires meticulous planning and highly efficient system implementation. The online market in China is all pay-for-play. Nothing is achieved with no money or minimal effort. If you want to sell online, you need to build an omnichannel system integrated with traditional distribution, and to do this, it is essential to involve a local partner with well-defined investments and responsibilities.

9 – China is not a market for everyone

You need to protect your brands, study the market thoroughly, know your competition (both foreign and local), find the right market channel, select a distributor motivated to invest time and money in promoting your product, and be willing to support them with the right investments. If you want to build a serious plan to enter the Chinese market, you must have a medium- to long-term perspective. There are no shortcuts (actually, there are many, but they almost always lead to wasted time and money). If you are unwilling to invest in entering the Chinese market through the front door, it is unlikely that anyone else will do it for you.

10 – Don’t do it yourself

If you have read up to point 9 and are still keen to enter the Chinese market, consider doing so professionally, involving consultants who can support your company throughout the market research, scouting, negotiation, and contract drafting processes. This is also part of the investment needed to build and develop a solid and resilient business model. This advice applies to all foreign markets, and even more so to China.

The most dangerous mistake one can make after the announcement of the (partial) suspension of U.S. duties for 90 days is to hope that everything will go well and we will return to the pre-April 2 world.

First, because very invasive tariffs remain in place: 10 percent on all countries that trade with the U.S., including the EU, 25 percent on automotive, 25 percent on steel and aluminum, 145 percent on China.

Second, because it is impossible to predict the actions of the U.S. Administration in the short and medium term: it cannot be ruled out that tariffs will remain, increase, change targets or that other factors will intervene to turn the tide in international markets, such as an escalation of the trade war with China.

The 90-day suspension is an opportunity

The U.S.’s temporary suspension of tariffs represents a valuable window that should be used not only as a truce but also as a valuable room for action: 90 days to rehash contracts, renegotiate key clauses, and insert levers of flexibility that can protect business in various future scenarios in the U.S. and other markets.

Today’s exporters cannot afford to „sit back and see what will happen“-it is time to act, and to do so professionally and strategically. Let’s look at a checklist of important points to consider.

What do contracts with customers and suppliers entail?

The first point is to survey agreements with the trade network in the U.S. and other countries that export to the U.S., as well as with upstream suppliers in the supply chain.

Is there a written contract? The worst-case scenario – unfortunately a very frequent one – is when the parties cooperate informally, only based on orders and order confirmations. This leaves undefined not only what happens in the case of imposition of duties, but also a whole range of other points, for example, limits on damages that can be claimed in the case of breach of contract, the duration of the agreement, the applicable law, and how any disputes will be resolved.

Another very problematic scenario is one in which contracts exist, but they are generic and do not include the necessary covenants to manage the risks involved in operating in a highly litigious market such as the U.S., which, moreover, has very high legal costs.

Having done this analysis, the necessary actions can be put in place, prioritizing according to the importance of business relationships and as appropriate:

  • Negotiate and conclude a written contract from scratch
  • Replace the existing agreement with a complete and correct contract
  • Amend and integrate the existing agreement with pacts to manage tariffs and other causes of price fluctuations

Let us dwell on the last scenario, assuming that there is a complete and correct contract but one that does not regulate price and cost fluctuation as a direct or indirect consequence of the introduction of duties.

Contract Addendum

In such cases, the correct course of action is to sign an Addendum to the original contract, specifying which covenants are being waived and which covenants are being added. It is essential that the Addendum be negotiated and signed by persons with the power of representation of the parties and that it be drafted with the help of lawyers who specialize in this field. In addition to including correct clauses, it is necessary to verify that the covenants are valid according to the rules of law applicable to the contract.

Here are some clauses that can be the subject of the Addendum, to be modulated according to the specific case and possible scenarios.

Tariff Cost Sharing

By introducing this covenant, it is provided that in the event that duties are confirmed at [x]% or are reduced or increased within certain established thresholds, the Parties will share the increase equally, or according to other established percentages.

There may also be a ceiling on tariffs beyond which a party has the right to withdraw from the contract or request the suspension of certain orders for a specified period of time, after which it has the right to withdraw.

Price Adjustment

With this covenant, a discount or an increase in the product’s price is agreed upon, as the case may be, in the case of a duty greater than [x]%.

Among the use cases, in addition to that of the company exporting to the U.S. or other intermediate markets, with final destination of the products in the U.S., is that of those who purchase a product subject to import duty and resell it, processed or assembled.

Right to Cancel or Postpone Confirmed Orders

This covenant gives the right to revoke or suspend for a certain period already negotiated orders, as such binding, in case of confirmation or introduction of duties above a certain threshold, for example, if 20% taxation was confirmed for the import of wine from the EU.

The clause can be combined with previous covenants, for example, by stipulating that below the specified threshold, the contracts remain valid, and the parties share the duty or have the right to renegotiate the price.

Supply Forecast Adjustment

With this clause the Parties can modify supply programs already agreed for a specific duration (e.g., 24 months), with continuous sales and purchase obligations at a fixed price or indexable only within certain limits. The aim is to agree on the prerequisites for reshaping supply programs in the short and medium term, which can be very useful for defining the rules that will apply to relationships with key suppliers or customers for possible changes in volumes, delivery times, and prices.

Right to Source from Alternative Suppliers

This covenant serves to be authorized, if necessary, to source alternative suppliers of components or raw materials to those previously authorized in the contract with the end customer, for example, in cases where purchasing from the original suppliers has become too costly or difficult due to duties imposed at import or in previous steps in the supply chain, or other events such as currency or price fluctuation of certain commodities beyond a certain level established in the agreement.

Hardship and Force Majeure

The imposition of duties cannot be invoked as a cause of Force Majeure or hardship, respectively, to excuse contract non-performance or to renegotiate the price, even in cases of very high price increases (such as the 145% duty imposed on Chinese products). This conclusion is almost uniform under the law and jurisprudence of the major countries involved in the tariff war: U.S., China, Canada, Mexico, France and Italy: I refer to this practical guide for a timely examination of what the various rules provide.

If the contract lacks a well drafter Force Majeure and Hardship clause, or contains a generic clause, it is important to get your hands on revising it to expressly state the cases in which a party is entitled to suspend or terminate the contract, how and when to communicate the decision to invoke the exemption, and the consequences on the parties‘ contractual obligations. You can go deeper on this topic here.

Conclusion

It is essential to prepare for possible future scenarios regarding duties (confirmed, increased, changed, or decreased) and to determine the consequences on trade relations with foreign clients and suppliers: moving today, at a standstill (or nearly so), allows entrepreneurs to negotiate shared and fair solutions and to avoid, as far as possible, the emergence of tensions and conflicts with the various partners along the international supply chain.

Roberto Luzi Crivellini

Rechtsgebiete

  • Schiedsgerichtsbarkeit
  • Vertrieb
  • Internationaler Handel
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    Vietnam | Updated Law on Pharmacy

    21. Juli 2025

    • Vietnam
    • Vertrieb
    • Internationaler Handel
    • Arzneimittelrecht

    It is quite common for business relationships with agents or distributors to last for years without any signed documents. And be careful, because we know that a contract can exist even verbally.

    The absence of a written contract will add difficulties in the event of a possible claim, so what you do between the decision to terminate, and the moment of the claim is very important. Remember: ‘anything you write will be used against you’.

    The decision to terminate a business relationship is a very delicate moment to which, for some reason, solicitors are not invited. Here are some examples (all real) in which companies or employees with the best of intentions wrote to the agent/distributor. All of them were subsequently very damaging to the company:

    Saying ‘We are terminating our business relationship’ when the strategy will be to argue that no such business relationship exists, but rather that there are separate and linked contracts (e.g., supply rather than ongoing distribution contract; very significant compensation consequences).

    ‘You no longer represent our company’, which may be evidence that you did so before.

    ‘As of day X, you may no longer act on behalf of our company,’ which would prove that you were previously able to act on its behalf.

    ‘You may not attend the X trade fair on our behalf.’ A way of confirming that the agent/distributor’s responsibilities included participating in trade fairs and probably accrediting the customers obtained.

    ‘The sales you promoted have been significantly reduced in year N.’ When there is no written contract or other form of documentation, imputing a breach of an obligation that is not clear can be counterproductive.

    Saying ‘You are not actively promoting our products’ and then adding: ‘We urge you to stop promoting the sale of our products’.

    ‘You are no longer our exclusive representative’, which proves a type of relationship (representation/agent) and a tacit or express agreement (‘exclusivity’).

    ‘We have appointed another representative in your area’, which shows that the agent/distributor had an assigned area and was “representing”.

    ‘From this moment on, orders will be handled by X’, which also confirms a type of relationship.

     

    In summary: from the moment the company considers terminating a commercial relationship, especially when it is not in writing and before sending any letter, it is advisable to think carefully about the strategy in case of a possible claim. This is the best time to seek advice and avoid surprises. Any communication that is not in line with this strategy designed from the outset can only lead to confusion and problems.

    Remember the USA – EU agreement on 15% tariffs? I wrote that with a negotiator like Trump the game is never over (article here) and—after the recent interlude featuring a threat of 100% tariffs on pharmaceuticals—the U.S. government has announced the imposition of an overall 107% duty on Italian pasta, which could take effect on January 1, 2026.

    Where this new duty comes from

    The antidumping investigation was launched by the U.S. Department of Commerce at the request of certain competing American companies and is based on a 1996 antidumping order that allows for periodic reviews of imports of Italian pasta. The Department of Commerce conducts these checks annually to assess whether Italian producers are selling pasta at prices lower than the U.S. domestic market, a practice known as “dumping.”

    Companies involved in the investigation

    The Department of Commerce selected two sample companies for in-depth analysis, defined as “mandatory respondents”: La Molisana and Pastificio Lucio Garofalo. According to the official document published by the U.S. administration, for the period from July 1, 2023 to June 30, 2024, both companies allegedly sold their products below market prices, resulting in the imposition of a duty of 91.74%.

    U.S. authorities justified this percentage by claiming the two companies did not provide complete or compliant information as requested by the Department and were therefore insufficiently cooperative during the investigation. What is very important is that, in addition to the two companies directly examined, the additional 91.74% duty is also applied to numerous other Italian producers not individually reviewed. This methodology, while formally permitted under U.S. law as an exception, is being applied without any direct verification of the other companies.

    Next steps in the procedure

    Italy’s Ministry of Foreign Affairs moved immediately, formally intervening in the proceeding as an “interested party” through the Italian Embassy in Washington. The Foreign Ministry is working in close coordination with the companies concerned and, in concert with the European Commission, to persuade the U.S. Department to revise the provisional duties.

    The two companies involved (La Molisana and Garofalo) can submit documentation to contest the dumping allegations. However, if dumping is confirmed, the Department of Commerce will instruct Customs to apply antidumping duties on goods sold and entered into U.S. commerce.

    The preliminary nature of this determination means there is still room to change the decision before it becomes final.

    Possible effective date

    The new super-duty of 91.74%, which will be added to the existing 15% tariff for a total of 107%, is scheduled to take effect on January 1, 2026. This date therefore represents a crucial deadline for all ongoing diplomatic and legal actions.

    If confirmed, the economic impact would be significant: in 2024, Italian pasta exports to the United States reached a value of €671 million according to Coldiretti, accounting for nearly 17% of the sector’s total exports. A 107% duty would risk seriously undermining competitiveness in one of the most important markets for Italian agri-food products.

     What to do between now and January 1, 2026?

    At this stage, the entry into force of the new duty depends on the outcome of the ongoing procedure: given what has happened in recent months, and the political use the U.S. administration has made of tariffs—well beyond their technical function—it is reasonable to be pessimistic.

    So, what to do? In recent months we have seen companies react to the uncertainty over the fate of the tariffs in three ways:

    • Some rushed to ship as many products as possible before the potential effective date of the duty;
    • Some granted—upfront—discounts equivalent to the threatened duty, in case it came into force;
    • Some suspended orders, pending definitive news on the impact of the duties.

    These are all  valid options, but other effective tools for managing the uncertainty caused by the flurry of announcements, negotiations, and threats from the U.S. administration should not be forgotten: the risk of new duties being introduced, or existing ones being increased, can be managed in the contract by agreeing with the U.S. importer how any tariff change will affect the product.

    The parties can stipulate, for example, that the increase will be split equally; or that the importer will bear it beyond a certain threshold; or that if the duty exceeds a certain level, the contracts may be terminated. You can find a deeper dive in this article.

    The only certainty is that trade relations with the U.S. will stay unpredictable for a long time, and it’s vital to carefully manage the risk factors involved in selling products there. Right now, the focus is on tariffs and prices, and I encourage you to take this chance to thoroughly review existing agreements and assess whether—and how—other important points are addressed that could entail significant liabilities: we discuss them, very practically, in this book.

    On 29 June 2025, the Vietnamese government introduced Decree No. 163/2025/ND-CP (Decree 163). This decree provides detailed guidance on how the updated Law on Pharmacy will be implemented.

    Like the amended Law on Pharmacy, Decree 163 came into effect on 1 July 2025, replacing the previous Decree No. 54/2017/ND-CP (Decree 54). The new decree sets out comprehensive rules for key aspects of managing pharmaceuticals, including:

    • Pharmacy practice certificates
    • Certificates allowing pharmaceutical businesses to operate
    • Import and export of medicines and drug ingredients
    • Good Manufacturing Practice (GMP) inspections of overseas manufacturers
    • Recalling medicines and drug ingredients
    • Certificates for medicine advertising content
    • Medicine price management

    Key Changes in Decree 163

    Here are some important changes and additions introduced by Decree 163:

    Destroying Specially Controlled Medicines

    You no longer need to get approval from the relevant authority before destroying narcotic, psychotropic, and precursor drugs, or pharmaceutical ingredients that are narcotic or psychotropic substances or precursors used in medicines. Instead, you just need to provide notification at least seven working days in advance. This notification must include the planned destruction date and a detailed list of items to be destroyed.

    E-commerce in Pharmaceutical

    Pharmaceutical businesses that sell products online must openly display the following information to ensure transparency and consumer safety:

    • Their certificate allowing them to operate as a pharmaceutical business.
    • The pharmacy practice certificate of the person responsible for pharmaceutical expertise.
    • Information about the medicines themselves.

    Shelf-Life Rules for Imported Products

    For medicines and ingredients with a total shelf life of nine months or less, at least one-third of their shelf life must remain when they clear customs. Medicines with a shelf life of 30 days or less must still be within their shelf life at the time of customs clearance.

    Controlling Imported Products

    All medicines with marketing authorisation (MA) are subject to import control, except for:

    • Medicines needed for preventing and treating Group A infectious diseases that have been declared epidemics, as per the Law on Prevention and Control of Infectious Diseases.
    • Medicines with a shelf life of less than 30 days.

    Importers must inform the provincial People’s Committee at least five working days before making a customs declaration. The People’s Committee can then issue a written notice of non-compliance to the customs authority within five working days of receiving this notification.

    Medicine Advertising

    Decree 163 adds a process that allows an approved medicine advertising certificate to be adjusted for certain changes (such as a change to the MA holder or manufacturer information). This means you don’t have to go through the entire initial registration process for medicine advertising content again, as was required under the previous rules.

    Medicine Price Management

    Businesses must announce or re-announce wholesale prices, similar to the medicine price declaration process under Decree 54. Some medicines are exempt from this requirement, including those provided free of charge for emergency responses, national health programmes, humanitarian aid, clinical trials, scientific research, or exhibition purposes, and medicines carried as personal luggage.

    The Ministry of Health (MOH) can make recommendations if the announced or re-announced price is significantly higher than similar medicines already on the market. This includes situations where:

    • The announced or re-announced wholesale price of the medicine is higher than the highest price of similar medicines.
    • The price difference is more than 35% (for medicines priced under VND 1 million) or 15% (for medicines priced at VND 1 million and above) compared to winning bid prices in tenders.
    • The announced or re-announced price is higher than prices in the country of origin or other markets (if there’s no similar product in Vietnam).
    • When such differences are found, the MOH issues a formal recommendation to the announcing business and publishes it online for transparency and accountability.

    Further Guidance in New Circular

    On 1 July 2025, the MOH issued Circular No. 31/2025/TT-BYT (Circular 31), which further details how the amended Law on Pharmacy and Decree 163 should be implemented. Circular 31 officially replaces Circular No. 07/2018/TT-BYT and Decree 54 and came into effect immediately.

    Key provisions of Circular 31 include:

    Notification of Practising Pharmacists

    Pharmaceutical businesses that are not part of a pharmacy chain must inform the relevant authority of a list of people currently working at the business who hold pharmacy practice certificates. This notification must be submitted within 15 days of the date the certificate allowing the pharmaceutical business to operate was issued, or when there are any changes to the list. This is a shorter deadline than the previous 30 days under earlier rules.

    Pharmacy chains have similar notification duties and deadlines. Specifically, the chain operator must inform the provincial authority where each pharmacy in the chain is located about the list of practising pharmacists at those sites. Additionally, pharmacy chains must notify the authority if pharmacies are added or removed from the chain, and if there are any rotations of the people responsible for pharmaceutical expertise between pharmacies within the chain.

    Medicine Information Activities

    Under Circular 31, medicine information can still be given to healthcare professionals through information materials, seminars, and medical representatives.

    However, Circular 31 introduces a significant change by removing the need to obtain a certificate for medicine information content before carrying out these activities. Under the new rules, pharmaceutical businesses, representative offices of foreign pharmaceutical companies in Vietnam, and MA holders are now responsible for creating and distributing medicine information materials. These materials must comply with the package inserts for medicines approved by the MOH, the Vietnamese National Drug Formulary, and any related documents and professional instructions issued or recognised by the MOH.

    Donald Trump, never one to shy away from drama or diplomacy-via-caps-lock, has slapped a 50% tariff on all Brazilian exports to the United States. The justification? In his own delicate prose: „The treatment of former President Jair Bolsonaro is a disgrace… A witch hunt that must end IMMEDIATELY!“

    And just in case anyone thought this was about trade imbalances or economic strategy, Trump made things crystal clear: „Due to Brazil’s insidious attacks on free elections…“.

    In short, the 50% tariff isn’t about coffee, orange juice, or flip-flops. It’s about a Supreme Court judgment, applying Brazilian law, regarding Brazilian politicians accused of conspiring in a coup d’état. In other words, this is a brazen (and frankly absurd) attempt at judicial intervention via trade war.

    Trump, with his characteristic subtlety, offered a solution: manufacture in the U.S., and he’ll look kindly upon Brazil, like a mafia don offering „protection“ after smashing your shop window. But what he meant was: consider Bolsonaro innocent, and we’ll talk.

    The Brazilian market took the bait

    Although the fishy interference in Brazilian affairs was determined from a fish out of the water, the market took the bait: in the first 48 hours after the infamous letter, at least 1500 tons of fish were already held in Brazilian ports, as US buyers suspended their contracts due to uncertainty about the costs upon arrival. The fish market is on alert, as 80% of the exports head to the US, mainly coming from small family-owned industries that distribute the catch from artisanal fishing communities.

    The same effect hit other sectors, from orange, honey, and coffee to aircraft.

    Brazil’s response and sorcery: don’t mess with us (or our weather)

    Naturally, Brazil will not sit quietly sipping caipirinhas while its sovereignty is trampled. Reciprocity is on the table: if Washington raises tariffs, Brasília can do the same. But above all, one thing is sure: Brazil will never tolerate foreign interference in its independent judiciary.

    And then, a curious coincidence: right after Trump’s speech, a tornado accompanied by lightning struck the White House grounds. Pure chance? Maybe. Or could it have been the work of Brazilian indigenous shamans, a particularly well-organized group of umbanda practitioners, or simply the fact that, as every Brazilian child knows, God is Brazilian.

    Trump might want to check the weather forecast next time before penning another angry letter.

    The unpredictable becoming predictable

    Trade wars are rarely tidy affairs, but one thing they consistently deliver is chaos (in legal terms, disruption). And when disruption meets contracts, force majeure disputes often end up in court.

    At first glance, Trump’s decision to impose a 50% tariff overnight might feel like an unpredictable thunderbolt (quite literally, given the weather at the White House). But here’s the catch: by now, unpredictable tariffs are becoming predictable. When a government with a well-documented love for impulsive economic diplomacy imposes politically motivated tariffs, can anyone claim to be surprised?

    In most jurisdictions, force majeure requires that the event be extraordinary, unforeseeable, and beyond the parties’ control. A sudden 50% tariff certainly ticks a few of those boxes, but following a repetition of erratic trade policy, one might argue that businesses should expect what in past times was considered unexpected, especially when dealing with certain jurisdictions or political figures. In other words, Trump’s tariffs might not excuse performance if parties didn’t prepare for exactly this kind of volatility.

    This is where good contract drafting comes into play

    Savvy businesses are learning that their contracts must go beyond a vague boilerplate clause about “acts of government” or “changes in law.” Instead, they should expressly address the risk of sudden tariff changes, including

    • hardship clauses that allow renegotiation when costs become commercially unreasonable;
    • price adjustment mechanisms linked to tariff thresholds;
    • termination rights triggered by specified levels of customs duties;
    • currency fluctuation provisions (because tariffs rarely travel alone, and currency swings often accompany them).

    In short, while no contract can immunize a business from every shock, smart drafting can mean the difference between a commercial headache and a catastrophic breach.

    Therefore, tariffs may no longer be an unpredictable storm; they are part of the new predictable landscape. Given that your contract might wake up tomorrow facing ‘IMMEDIATE’ punitive tariffs in all caps, your contract should be ready today.

    The unwitting cupid: strengthening EU-Brazil relations

    While the tariffs may ruffle trade flows between Brasília and Washington, there’s an unintended silver lining: Trump is proving to be the most efficient matchmaker between Brazil and other markets, such as China and the European Union.

    The EU-Brazil relationship, already a flirtation with promising prospects, with relevant progress in the EU-Mercosur Agreement, now seems destined for deeper romance. If Mr. Trump insists on isolating the US from Brazil, the old continent stands ready, with flowers and wine in hand, to pick up where the US left off. After all, Brazilian fish can pair up nicely with champagne, cava and prosecco.

    So thank you, Mr. Trump. In your quest to bully Brazil into submission, you may have done more to strengthen transatlantic ties than any EU Commissioner ever could. As they say in Brasília these days: Trump is not a trade warrior. He’s a cupid in disguise.

    The recent announcement of a landmark trade agreement framework, following just three months negotiations since President Trump’s tariffs announcement on 2 April 2025, signals a pivotal shift, not merely in bilateral relations, but in the broader architecture of global supply chains.

    As a commercial lawyer with exposure to Vietnam since 2007, I have observed the evolving dynamics between the United States and Vietnam through the years, talking to students, entrepreneurs, veterans, diplomats, humans from all walks all life, from both nations and beyond.

    You may recall that Vietnam, with the notable exclusion of China, was to be the nation that would encounter the most stringent tariffs imposed by the Trump administration, reaching an astonishing 46%.

    The newly forged framework outlines significant reciprocal concessions designed to foster greater trade and investment flows. Granted, pre-April 2 tariffs applied by the USA on Vietnamese goods were lower than what emerges from the framework agreement, but still, it is better than 46%),

    The United States has committed to imposing a 20% tariff on most Vietnamese imports, a notable reduction from the previously mooted 46%. However, a substantial 40% tariff will apply to goods re-exported from third countries, with a particular focus on those originating from China.

    Vietnam has pledged to open its market to a wide array of US products. Crucially, it has also committed to implementing stringent measures aimed at restricting the transshipment of Chinese goods through its territory, a long-standing concern for Washington.

    In a significant win for American exporters, US goods will now enjoy duty-free access to the Vietnamese market, effectively granting “total access”, particularly for large-engine vehicles such as SUVs, as emphatically stated by President Trump (how SUVs are going to circulate in the narrow alleys of Hanoi and Ho Chi Minh City, infested by swarms of mopeds, is a different story).

    This agreement is expected to catalyse growth in several key sectors. Electronics, textiles, furniture, energy (especially Liquefied Natural Gas), and agriculture are poised for expansion. US firms specialising in manufacturing technology, energy solutions, and agricultural products are anticipated to be the primary beneficiaries. Furthermore, beyond immediate trade benefits, the agreement is set to reshape investment strategies, encouraging a greater localisation of supply chains within Vietnam. This strategic realignment is also expected to further solidify the already robust US-Vietnam Comprehensive Strategic Partnership.

    While the potential upsides are considerable, it is imperative for businesses and investors to approach this new landscape with a clear understanding of the accompanying risks. From my vantage point, I identify several significant execution challenges and structural impediments that require close monitoring.

    Enforcement of Transshipment Controls

    The most immediate and perhaps formidable risk lies in the effective enforcement of transshipment controls. Vietnam has historically served as a significant assembly point for Chinese-manufactured components. Ensuring that goods originating from China are not merely re-routed through Vietnam to circumvent US tariffs will require exceptionally close monitoring and robust verification mechanisms. The legal and practical complexities of definitively determining the true country of origin for all goods will undoubtedly pose a persistent challenge. As a European citizen, witnessing how the EU-Vietnam Free Trade Agreement (“EVFTA”), which poses an important stress on certificates of origin, I am particularly aware of this matter.

    While Vietnam has made remarkable strides in its economic development, certain structural issues could hinder its capacity to scale up high-value manufacturing in the short to medium term. These include:

    Legal framework nuances

    Vietnam’s legal framework for foreign investment has seen continuous improvements, but legal and cultural complexities and inconsistencies can and do still arise. Navigating the regulatory landscape, particularly with new rules stemming from this agreement and at a time of deep administrative, governmental, digital and legal reforms in Vietnam, will demand expert legal guidance to ensure compliance and mitigate potential fines and disputes. Issues surrounding so-called sublicences for businesses, intellectual property rights enforcement and contract enforceability, whilst improving, still require careful consideration;

    Education

    The ambition to transform Vietnam into a high-value manufacturing hub necessitates a workforce equipped with advanced skills. While the Vietnamese government prioritises education and workforce development, a significant portion of the current labour force lacks formal training and specialised certifications, let alone a good command of the English language. Bridging this skills gap, particularly in areas like advanced manufacturing, engineering, and digital technologies is a necessity and not just in light of this framework agreement. Companies may need to factor in substantial investment in training and upskilling programmes for their Vietnamese employees.

    Infrastructures

    Despite considerable investment, Vietnam’s infrastructure, particularly in logistics, energy, and transportation, continues to face bottlenecks. And China – the apparent target of Trump’s tariffs – is stepping in with high-speed trains connecting it to the northern Provinces of Vietnam. An increased volume of high-value manufacturing and trade will place further strain on existing infrastructure. Inadequate port capacity, congested roads, and a reliable energy supply (including for EV charging) are critical concerns that could impact efficiency and increase operational costs for businesses.

    Policy divergence

    This framework agreement deepens US-Vietnam trade ties and seems to be paving the way for more US investments in Vietnam, but this second aspect seems to run counter to parallel US policy objectives aimed at reshoring manufacturing back to the United States. This potential divergence in strategic priorities could introduce yet another element of unpredictability in the long term, necessitating a flexible and adaptable investment approach. Future shifts in US policy could impact the durability and full extent of the benefits derived from this agreement.

    This trade agreement, if finalised and implemented, undoubtedly represents a structural shift in global trade dynamics. It strategically positions Vietnam as an increasingly important high-value manufacturing hub and significantly deepens US engagement in Southeast Asia. We will need time, however, to assess the practical impact of the agreement, observing the efficacy of its implementation, and understanding how Vietnam’s inherent strengths and challenges will ultimately shape its role in the reconfigured global supply chain.

    We will also need to see what China, if anything, will do as a countermeasure. In fact, any assessment of Vietnam’s evolving trade landscape would be incomplete without a thorough consideration of China’s influence and strategic posture. President Xi Jinping has consistently championed a vision of a “community of shared future for mankind,” a concept that, while outwardly promoting global cooperation, also subtly underscores a demand for international alignment with Beijing’s interests. In the context of escalating trade tensions, Xi has repeatedly warned that “trade wars have no winners,” advocating for unity against protectionist measures, yet simultaneously implying that nations must ultimately choose sides, either with or against China’s economic and political orbit. Vietnam, despite its historical complexities and occasional maritime disputes with Beijing in the South China Sea (or East Sea, as it is officially called by Hanoi), remains deeply interwoven with China’s economy. China has been Vietnam’s largest trading partner for many years, with significant inflows of Chinese FDI, loans, and project contractors. This economic dependency is particularly evident in various sectors, where Chinese components and materials form a substantial part of Vietnamese manufacturing supply chains. While Vietnam has actively sought to diversify its trade partners and reduce its reliance on China, the sheer scale of the bilateral economic relationship means that disentanglement is a long-term, complex endeavour. Furthermore, China’s influence extends beyond direct trade into crucial regional resources. The Mekong River, a lifeline for millions in Southeast Asia, originates in China, which has constructed numerous upstream dams.

    As Vietnam navigates its enhanced trade relationship with the United States, it must simultaneously contend with the enduring economic gravity and strategic ambitions of its northern giant neighbour. Any perceived move by Vietnam to significantly shift away from China could invite retaliatory measures or heightened pressure from Beijing. Businesses investing in Vietnam must not only grasp the intricacies of the US-Vietnam agreement but also meticulously analyse how these developments will intersect with, and potentially be impacted by, the intricate, often delicate, and sometimes fraught relationship between Hanoi and Beijing. Understanding this geopolitical tightrope will be essential for sustainable success in the Vietnamese market. Prudence, informed legal counsel, and a keen eye on evolving geopolitical and economic realities will be paramount for those seeking to capitalise on this transformative new chapter.

    Takeaways

    • Tariffs:The US-Vietnam framework agreement marks a significant departure from previous trade dynamics, reducing US tariffs on most Vietnamese imports to 20% (from a mooted 46%) while imposing a 40% tariff on transshipped goods, especially from China.
    • Vietnam’s market opening:Vietnam has committed to duty-free access for a broad range of US products and stricter controls on Chinese goods transiting its territory.
    • Growth / manufacturing shift potential:The agreement is expected to fuel expansion in Vietnamese electronics, textiles, furniture, energy (LNG), and agriculture. It also encourages supply chain localisation within Vietnam (normally more of an assembly point for Chinese products).
    • Execution challenges: Effectively preventing the re-routing of Chinese goods through Vietnam to avoid tariffs will be a complex and demanding task; Despite economic progress, Vietnam faces hurdles in scaling high-value manufacturing due to legal framework nuances (e.g., sublicences, IP enforcement), a skills gap in its workforce (lack of formal training, English proficiency) and infrastructure bottlenecks (logistics, energy, transportation).
    • US policy divergence:The agreement’s encouragement of US investment in Vietnam appears to contradict the broader US policy objective of reshoring manufacturing.
    • China:Businesses must consider China’s significant economic sway over Vietnam, including its position as Vietnam’s largest trading partner, its FDI, and its control over shared resources like the Mekong River. Any major shift by Vietnam away from China could lead to retaliatory measures from Beijing.
    • Uncertainty:This is not a final agreement, so the situation might change. Prudence and informed legal counsel are crucial for businesses navigating this evolving landscape.

    The Trump approach: power and dominance

    In his autobiography, The Art of the Deal, Donald Trump describes negotiation as a contest of strength, determination, and dominance. His vision is clear: anyone who shows uncertainty or makes concessions too early is immediately perceived as a loser. His negotiating style is based on constant pressure, maximalist demands, and calculated threats, to obtain unilateral advantages. In this scheme, compromise is not a point of arrival, but a sign of weakness to be avoided.

    Trump has always been a competitive negotiator, focused on immediate results and uninterested in balanced solutions unless they are strictly functional to his interests.

    Other negotiating styles: compromising and collaborative

    In contrast to this competitive approach, there are two other relevant negotiating styles:

    • The compromising style aims to reach a ‘middle ground’ agreement, in which both parties give something up to achieve an acceptable solution. It is a pragmatic approach, practical in situations where time is limited or positions are too far apart for genuine collaboration.
    • The collaborative style, on the other hand, aims to create win-win solutions. The parties seek to thoroughly understand each other’s interests and work together to build an outcome that maximizes the benefit for both. It requires openness, time, and trust.

    In commercial negotiations, the compromising or collaborative approach can only work if the other party shares the same logic. But when dealing with an explicitly competitive actor such as Trump, adopting a compromising style risks seriously penalizing the other party, for at least three reasons:

    • It conveys weakness

    An accommodating gesture is seen not as a sign of openness, but as a point of pressure to be exploited. The competitive negotiator, focused on gaining an immediate advantage, interprets it as a willingness to give even more.

    • It relinquishes bargaining power

    The EU has a vast market and significant trade levers, especially in a context where the US is closing the door to the Chinese market. Offering concessions at the outset is tantamount to burning your cards without getting anything in return. In a competitive confrontation, the first move can set the tone for the negotiation: once a concession has been made, it is very difficult to backtrack.

    • It legitimizes the negotiating imbalance

    An unbalanced compromise, if accepted without resistance, risks becoming the new basis for future trade relations, systematically penalizing the EU in subsequent rounds.

    Why 30%? The anchor technique

    Trump often uses a negotiating technique known as the anchor technique. This consists of deliberately setting a very high target at the beginning of the negotiation (in our case, the threat of 30% tariffs).

    The aim is to create a psychological perimeter for the negotiation and force the other party to reason on the basis of that figure, even though they are aware that it is arbitrary. This technique allows one to influence the scope of the discussion and obtain greater concessions, just as Trump has done.

    The worst response: unilateral concessions with no return

    Unfortunately, the European Union has already shown worrying signs of a compromising attitude that has not been negotiated with the Trump administration, for example:

    • The waiver of the web tax* on American digital giants, without obtaining any regulation or shared tax contribution in return.
    • The offer to increase imports of liquefied natural gas (LNG) from the US, made to reassure Washington, without obtaining anything in return.
    • The acceptance of the increase in NATO spending to 5% of GDP, demanded by Trump, again without obtaining anything in return.

    All these offers without asking for anything in return reinforce the idea that the EU is willing to concede from the outset. Trump, true to his competitive logic, sees these concessions as a starting point, not a compromise: this pushes him to raise his demands, not moderate them.

    Persevering would be a fatal mistake

    Continuing along this path of compromise, in the hope that accommodation will ease the pressure, would be not only ineffective but counterproductive. With a competitive negotiator, unilateral concessions do not stop escalation: they fuel it. Any sign of weakness is interpreted as additional room for maneuver.

    A helpful example is China’s reaction during the trade war initiated by Trump. Faced with massive tariffs imposed by the US, Beijing responded in kind, imposing equivalent tariffs. Instead of giving in, it spoke the same language of power. The result is there for all to see: after weeks of escalation, the US had to moderate its position, opening up to a more balanced agreement.

    The right strategy: speak his language

    To avoid the mistakes of the past, the EU should therefore reverse its negotiating logic. Not to fuel confrontation, but to restore a credible balance. Some applicable countermeasures could be:

    • Target Trump’s electoral base, particularly the agricultural sectors (soy, corn, beef), with selective tariffs or targeted restrictions.
    • Put the European web tax* back on the table, even with a minimum rate, linking any exemptions to real concessions from the US.

    These well-calibrated moves would strengthen the EU’s position and show that it can defend its interests by speaking a language Trump understands: that of strength and bargaining power.

    Going beyond requests, seeking the other party’s interests

    A fundamental principle in any negotiation is to identify the other side’s interests and find a way to allow them to achieve them without sacrificing your own. This is no easy task, given Trump’s notorious volatility and the lack of sound arguments to justify the demands made in the negotiations.

    In the case of the EU-US negotiations, it must be borne in mind that Trump is playing the game with his electoral base in mind: an agreement must offer him a narrative of victory to communicate to his electorate.

    Takeaway

    When negotiating with a competitive player like Trump, one should abandon the accommodating approach, avoid concessions without something in return, and adopt a style that is more assertive, strategic, and symmetrical.

    Only then will it be able to build an agreement that is solid, fair, and respectful of its economic and political strength.

    I have often dealt with commercial distribution agreements between Italian and Chinese companies, sometimes following negotiations in the wine sector for various types of agreements: sales, distribution, franchising, establishment of joint ventures, and sales through online stores.

    I am sharing some key considerations for approaching this complex but opportunity-rich market.

    📌 Here are my 10 takeaways

    Step Zero. Protect your IP

    it is essential to protect your intellectual property before entering China. This includes trademarks (including their Chinese transliteration), labels, web domains, and social media accounts. Neglecting this aspect can have disastrous consequences, exposing you to the widespread phenomenon of trademark squatting (even famous names such as Michael Jordan, Elon Musk, and Donald Trump have fallen victim to this).

    For more information, you can read this article about Intellectual property protection in China

    1 – Know your enemy

    trust is good, but mistrust is better. Before entering into commercial agreements, it is essential to check the credentials of potential partners through the databases of the State Administration for Industry and Commerce. When it comes to wine, it is necessary to check whether the prospective distributor has a license to import and distribute wine.

    2 – No copy-paste

     Contracts must be tailor-made, adapting them to local specificities. In particular, it is crucial to clearly regulate promotional activities: budget, commercial actions, communication methods, and management of the producer’s trademarks. It is also best to write the contract in Chinese to ensure that there are no misunderstandings and in case it needs to be used before a judge or local administrative body, as Chinese is the only official language. (N.B.: if you think of entrusting the task to ChatGPT, this is not a good idea).

    For an in-depth article, check out The commercial distribution contract in China

    3 – Decide immediately how and where to litigate

    It may seem counterintuitive, but it is best to avoid providing for Italian (or French, or German) jurisdiction and applicable law, which is an ineffective solution, especially in cases where urgent action is needed to stop unfair competition or counterfeiting. Consider applying Chinese law and provide for an arbitration clause at CIETAC. An effective dispute management strategy is a key element of the agreement and must be negotiated carefully. (P.S.: This applies not only to China but to all international agreements. For more information, see this article).

    4 – China is big

    And it is the sum of many very different internal markets. Exclusivity should be granted for good reasons, but only if the distributor has a well-developed commercial network and can achieve specific shared objectives. If granted, it should be limited to the province where the distributor is based and subject to the achievement of agreed sales volumes. Having a single distributor for the whole of China is like entrusting an Italian distributor with promoting a product throughout Europe. Or appoint a NYC-based company to promote and sell your wines in all 50 US States.

    5 – China is far away

    Delegating everything to the local distributor and taking no interest in what is happening on the Chinese market is never a good idea. Firstly, because you have no idea how, where, and with what results the wines are being sold. Secondly, because you cannot verify compliance with agreements, for example on non-competition or the use of trademarks. It is therefore important to schedule meetings to share commercial policies and be able to verify what is happening, including through audits and visits to warehouses and the sales network.

    6 – China is expensive

    Competition in the Chinese domestic market is fierce. This is also true in terms of price, as some countries that are direct competitors of Italy (Australia, Chile, New Zealand) have free trade agreements and can therefore enter the market on more favorable terms than Italian wine, which is subject to a total tax burden of around 43% after payment of duties, excise taxes, and VAT. It is necessary to position oneself in the right market segment (medium-high), and to do so, it is necessary to plan the right commercial actions together with the distributor. Selling Ex-Works and hoping that the distributor will take care of everything is not an excellent strategy for being competitive.

    7 – China is dangerous

    Scams are always around the corner. In the wine world in particular, for example, spontaneous expressions of interest are frequent, arriving via the company website, social media accounts, or directly via email. They sound like this: we have discovered your wines, we think they are fantastic, we want to place an order immediately. If it sounds too good and easy, it is certainly a scam. There is an easy way to check: if the next step is a request for payment of a few thousand euros, justified by the need to register the wines on the CIFER (China Imported Food Enterprise Registration) portal, or to register your trademark to prevent others from doing so, or to authenticate the signature on the sales contract… these are attempts at fraud, and the elusive order will never arrive after payment has been received. How can you check whether the person you are dealing with is a reputable company or a fraudster? 👉🏼Go back to point 1 (here is an in-depth article).

    8 – E-commerce? Yes, but with method (and money)

    Online wine sales continue to grow, but entering large platforms is complex, competition is fierce, and running an online store requires meticulous planning and highly efficient system implementation. The online market in China is all pay-for-play. Nothing is achieved with no money or minimal effort. If you want to sell online, you need to build an omnichannel system integrated with traditional distribution, and to do this, it is essential to involve a local partner with well-defined investments and responsibilities.

    9 – China is not a market for everyone

    You need to protect your brands, study the market thoroughly, know your competition (both foreign and local), find the right market channel, select a distributor motivated to invest time and money in promoting your product, and be willing to support them with the right investments. If you want to build a serious plan to enter the Chinese market, you must have a medium- to long-term perspective. There are no shortcuts (actually, there are many, but they almost always lead to wasted time and money). If you are unwilling to invest in entering the Chinese market through the front door, it is unlikely that anyone else will do it for you.

    10 – Don’t do it yourself

    If you have read up to point 9 and are still keen to enter the Chinese market, consider doing so professionally, involving consultants who can support your company throughout the market research, scouting, negotiation, and contract drafting processes. This is also part of the investment needed to build and develop a solid and resilient business model. This advice applies to all foreign markets, and even more so to China.

    The most dangerous mistake one can make after the announcement of the (partial) suspension of U.S. duties for 90 days is to hope that everything will go well and we will return to the pre-April 2 world.

    First, because very invasive tariffs remain in place: 10 percent on all countries that trade with the U.S., including the EU, 25 percent on automotive, 25 percent on steel and aluminum, 145 percent on China.

    Second, because it is impossible to predict the actions of the U.S. Administration in the short and medium term: it cannot be ruled out that tariffs will remain, increase, change targets or that other factors will intervene to turn the tide in international markets, such as an escalation of the trade war with China.

    The 90-day suspension is an opportunity

    The U.S.’s temporary suspension of tariffs represents a valuable window that should be used not only as a truce but also as a valuable room for action: 90 days to rehash contracts, renegotiate key clauses, and insert levers of flexibility that can protect business in various future scenarios in the U.S. and other markets.

    Today’s exporters cannot afford to „sit back and see what will happen“-it is time to act, and to do so professionally and strategically. Let’s look at a checklist of important points to consider.

    What do contracts with customers and suppliers entail?

    The first point is to survey agreements with the trade network in the U.S. and other countries that export to the U.S., as well as with upstream suppliers in the supply chain.

    Is there a written contract? The worst-case scenario – unfortunately a very frequent one – is when the parties cooperate informally, only based on orders and order confirmations. This leaves undefined not only what happens in the case of imposition of duties, but also a whole range of other points, for example, limits on damages that can be claimed in the case of breach of contract, the duration of the agreement, the applicable law, and how any disputes will be resolved.

    Another very problematic scenario is one in which contracts exist, but they are generic and do not include the necessary covenants to manage the risks involved in operating in a highly litigious market such as the U.S., which, moreover, has very high legal costs.

    Having done this analysis, the necessary actions can be put in place, prioritizing according to the importance of business relationships and as appropriate:

    • Negotiate and conclude a written contract from scratch
    • Replace the existing agreement with a complete and correct contract
    • Amend and integrate the existing agreement with pacts to manage tariffs and other causes of price fluctuations

    Let us dwell on the last scenario, assuming that there is a complete and correct contract but one that does not regulate price and cost fluctuation as a direct or indirect consequence of the introduction of duties.

    Contract Addendum

    In such cases, the correct course of action is to sign an Addendum to the original contract, specifying which covenants are being waived and which covenants are being added. It is essential that the Addendum be negotiated and signed by persons with the power of representation of the parties and that it be drafted with the help of lawyers who specialize in this field. In addition to including correct clauses, it is necessary to verify that the covenants are valid according to the rules of law applicable to the contract.

    Here are some clauses that can be the subject of the Addendum, to be modulated according to the specific case and possible scenarios.

    Tariff Cost Sharing

    By introducing this covenant, it is provided that in the event that duties are confirmed at [x]% or are reduced or increased within certain established thresholds, the Parties will share the increase equally, or according to other established percentages.

    There may also be a ceiling on tariffs beyond which a party has the right to withdraw from the contract or request the suspension of certain orders for a specified period of time, after which it has the right to withdraw.

    Price Adjustment

    With this covenant, a discount or an increase in the product’s price is agreed upon, as the case may be, in the case of a duty greater than [x]%.

    Among the use cases, in addition to that of the company exporting to the U.S. or other intermediate markets, with final destination of the products in the U.S., is that of those who purchase a product subject to import duty and resell it, processed or assembled.

    Right to Cancel or Postpone Confirmed Orders

    This covenant gives the right to revoke or suspend for a certain period already negotiated orders, as such binding, in case of confirmation or introduction of duties above a certain threshold, for example, if 20% taxation was confirmed for the import of wine from the EU.

    The clause can be combined with previous covenants, for example, by stipulating that below the specified threshold, the contracts remain valid, and the parties share the duty or have the right to renegotiate the price.

    Supply Forecast Adjustment

    With this clause the Parties can modify supply programs already agreed for a specific duration (e.g., 24 months), with continuous sales and purchase obligations at a fixed price or indexable only within certain limits. The aim is to agree on the prerequisites for reshaping supply programs in the short and medium term, which can be very useful for defining the rules that will apply to relationships with key suppliers or customers for possible changes in volumes, delivery times, and prices.

    Right to Source from Alternative Suppliers

    This covenant serves to be authorized, if necessary, to source alternative suppliers of components or raw materials to those previously authorized in the contract with the end customer, for example, in cases where purchasing from the original suppliers has become too costly or difficult due to duties imposed at import or in previous steps in the supply chain, or other events such as currency or price fluctuation of certain commodities beyond a certain level established in the agreement.

    Hardship and Force Majeure

    The imposition of duties cannot be invoked as a cause of Force Majeure or hardship, respectively, to excuse contract non-performance or to renegotiate the price, even in cases of very high price increases (such as the 145% duty imposed on Chinese products). This conclusion is almost uniform under the law and jurisprudence of the major countries involved in the tariff war: U.S., China, Canada, Mexico, France and Italy: I refer to this practical guide for a timely examination of what the various rules provide.

    If the contract lacks a well drafter Force Majeure and Hardship clause, or contains a generic clause, it is important to get your hands on revising it to expressly state the cases in which a party is entitled to suspend or terminate the contract, how and when to communicate the decision to invoke the exemption, and the consequences on the parties‘ contractual obligations. You can go deeper on this topic here.

    Conclusion

    It is essential to prepare for possible future scenarios regarding duties (confirmed, increased, changed, or decreased) and to determine the consequences on trade relations with foreign clients and suppliers: moving today, at a standstill (or nearly so), allows entrepreneurs to negotiate shared and fair solutions and to avoid, as far as possible, the emergence of tensions and conflicts with the various partners along the international supply chain.

    Federico Vasoli

    Rechtsgebiete

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    • Auslandsinvestitionen
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      The USA vs. Brazil Trade War | How to Lose a Trade Partner in 10 Tweets

      18. Juli 2025

      • Brasilien
      • USA
      • Vertrieb
      • Internationaler Handel
      • Steuer

      It is quite common for business relationships with agents or distributors to last for years without any signed documents. And be careful, because we know that a contract can exist even verbally.

      The absence of a written contract will add difficulties in the event of a possible claim, so what you do between the decision to terminate, and the moment of the claim is very important. Remember: ‘anything you write will be used against you’.

      The decision to terminate a business relationship is a very delicate moment to which, for some reason, solicitors are not invited. Here are some examples (all real) in which companies or employees with the best of intentions wrote to the agent/distributor. All of them were subsequently very damaging to the company:

      Saying ‘We are terminating our business relationship’ when the strategy will be to argue that no such business relationship exists, but rather that there are separate and linked contracts (e.g., supply rather than ongoing distribution contract; very significant compensation consequences).

      ‘You no longer represent our company’, which may be evidence that you did so before.

      ‘As of day X, you may no longer act on behalf of our company,’ which would prove that you were previously able to act on its behalf.

      ‘You may not attend the X trade fair on our behalf.’ A way of confirming that the agent/distributor’s responsibilities included participating in trade fairs and probably accrediting the customers obtained.

      ‘The sales you promoted have been significantly reduced in year N.’ When there is no written contract or other form of documentation, imputing a breach of an obligation that is not clear can be counterproductive.

      Saying ‘You are not actively promoting our products’ and then adding: ‘We urge you to stop promoting the sale of our products’.

      ‘You are no longer our exclusive representative’, which proves a type of relationship (representation/agent) and a tacit or express agreement (‘exclusivity’).

      ‘We have appointed another representative in your area’, which shows that the agent/distributor had an assigned area and was “representing”.

      ‘From this moment on, orders will be handled by X’, which also confirms a type of relationship.

       

      In summary: from the moment the company considers terminating a commercial relationship, especially when it is not in writing and before sending any letter, it is advisable to think carefully about the strategy in case of a possible claim. This is the best time to seek advice and avoid surprises. Any communication that is not in line with this strategy designed from the outset can only lead to confusion and problems.

      Remember the USA – EU agreement on 15% tariffs? I wrote that with a negotiator like Trump the game is never over (article here) and—after the recent interlude featuring a threat of 100% tariffs on pharmaceuticals—the U.S. government has announced the imposition of an overall 107% duty on Italian pasta, which could take effect on January 1, 2026.

      Where this new duty comes from

      The antidumping investigation was launched by the U.S. Department of Commerce at the request of certain competing American companies and is based on a 1996 antidumping order that allows for periodic reviews of imports of Italian pasta. The Department of Commerce conducts these checks annually to assess whether Italian producers are selling pasta at prices lower than the U.S. domestic market, a practice known as “dumping.”

      Companies involved in the investigation

      The Department of Commerce selected two sample companies for in-depth analysis, defined as “mandatory respondents”: La Molisana and Pastificio Lucio Garofalo. According to the official document published by the U.S. administration, for the period from July 1, 2023 to June 30, 2024, both companies allegedly sold their products below market prices, resulting in the imposition of a duty of 91.74%.

      U.S. authorities justified this percentage by claiming the two companies did not provide complete or compliant information as requested by the Department and were therefore insufficiently cooperative during the investigation. What is very important is that, in addition to the two companies directly examined, the additional 91.74% duty is also applied to numerous other Italian producers not individually reviewed. This methodology, while formally permitted under U.S. law as an exception, is being applied without any direct verification of the other companies.

      Next steps in the procedure

      Italy’s Ministry of Foreign Affairs moved immediately, formally intervening in the proceeding as an “interested party” through the Italian Embassy in Washington. The Foreign Ministry is working in close coordination with the companies concerned and, in concert with the European Commission, to persuade the U.S. Department to revise the provisional duties.

      The two companies involved (La Molisana and Garofalo) can submit documentation to contest the dumping allegations. However, if dumping is confirmed, the Department of Commerce will instruct Customs to apply antidumping duties on goods sold and entered into U.S. commerce.

      The preliminary nature of this determination means there is still room to change the decision before it becomes final.

      Possible effective date

      The new super-duty of 91.74%, which will be added to the existing 15% tariff for a total of 107%, is scheduled to take effect on January 1, 2026. This date therefore represents a crucial deadline for all ongoing diplomatic and legal actions.

      If confirmed, the economic impact would be significant: in 2024, Italian pasta exports to the United States reached a value of €671 million according to Coldiretti, accounting for nearly 17% of the sector’s total exports. A 107% duty would risk seriously undermining competitiveness in one of the most important markets for Italian agri-food products.

       What to do between now and January 1, 2026?

      At this stage, the entry into force of the new duty depends on the outcome of the ongoing procedure: given what has happened in recent months, and the political use the U.S. administration has made of tariffs—well beyond their technical function—it is reasonable to be pessimistic.

      So, what to do? In recent months we have seen companies react to the uncertainty over the fate of the tariffs in three ways:

      • Some rushed to ship as many products as possible before the potential effective date of the duty;
      • Some granted—upfront—discounts equivalent to the threatened duty, in case it came into force;
      • Some suspended orders, pending definitive news on the impact of the duties.

      These are all  valid options, but other effective tools for managing the uncertainty caused by the flurry of announcements, negotiations, and threats from the U.S. administration should not be forgotten: the risk of new duties being introduced, or existing ones being increased, can be managed in the contract by agreeing with the U.S. importer how any tariff change will affect the product.

      The parties can stipulate, for example, that the increase will be split equally; or that the importer will bear it beyond a certain threshold; or that if the duty exceeds a certain level, the contracts may be terminated. You can find a deeper dive in this article.

      The only certainty is that trade relations with the U.S. will stay unpredictable for a long time, and it’s vital to carefully manage the risk factors involved in selling products there. Right now, the focus is on tariffs and prices, and I encourage you to take this chance to thoroughly review existing agreements and assess whether—and how—other important points are addressed that could entail significant liabilities: we discuss them, very practically, in this book.

      On 29 June 2025, the Vietnamese government introduced Decree No. 163/2025/ND-CP (Decree 163). This decree provides detailed guidance on how the updated Law on Pharmacy will be implemented.

      Like the amended Law on Pharmacy, Decree 163 came into effect on 1 July 2025, replacing the previous Decree No. 54/2017/ND-CP (Decree 54). The new decree sets out comprehensive rules for key aspects of managing pharmaceuticals, including:

      • Pharmacy practice certificates
      • Certificates allowing pharmaceutical businesses to operate
      • Import and export of medicines and drug ingredients
      • Good Manufacturing Practice (GMP) inspections of overseas manufacturers
      • Recalling medicines and drug ingredients
      • Certificates for medicine advertising content
      • Medicine price management

      Key Changes in Decree 163

      Here are some important changes and additions introduced by Decree 163:

      Destroying Specially Controlled Medicines

      You no longer need to get approval from the relevant authority before destroying narcotic, psychotropic, and precursor drugs, or pharmaceutical ingredients that are narcotic or psychotropic substances or precursors used in medicines. Instead, you just need to provide notification at least seven working days in advance. This notification must include the planned destruction date and a detailed list of items to be destroyed.

      E-commerce in Pharmaceutical

      Pharmaceutical businesses that sell products online must openly display the following information to ensure transparency and consumer safety:

      • Their certificate allowing them to operate as a pharmaceutical business.
      • The pharmacy practice certificate of the person responsible for pharmaceutical expertise.
      • Information about the medicines themselves.

      Shelf-Life Rules for Imported Products

      For medicines and ingredients with a total shelf life of nine months or less, at least one-third of their shelf life must remain when they clear customs. Medicines with a shelf life of 30 days or less must still be within their shelf life at the time of customs clearance.

      Controlling Imported Products

      All medicines with marketing authorisation (MA) are subject to import control, except for:

      • Medicines needed for preventing and treating Group A infectious diseases that have been declared epidemics, as per the Law on Prevention and Control of Infectious Diseases.
      • Medicines with a shelf life of less than 30 days.

      Importers must inform the provincial People’s Committee at least five working days before making a customs declaration. The People’s Committee can then issue a written notice of non-compliance to the customs authority within five working days of receiving this notification.

      Medicine Advertising

      Decree 163 adds a process that allows an approved medicine advertising certificate to be adjusted for certain changes (such as a change to the MA holder or manufacturer information). This means you don’t have to go through the entire initial registration process for medicine advertising content again, as was required under the previous rules.

      Medicine Price Management

      Businesses must announce or re-announce wholesale prices, similar to the medicine price declaration process under Decree 54. Some medicines are exempt from this requirement, including those provided free of charge for emergency responses, national health programmes, humanitarian aid, clinical trials, scientific research, or exhibition purposes, and medicines carried as personal luggage.

      The Ministry of Health (MOH) can make recommendations if the announced or re-announced price is significantly higher than similar medicines already on the market. This includes situations where:

      • The announced or re-announced wholesale price of the medicine is higher than the highest price of similar medicines.
      • The price difference is more than 35% (for medicines priced under VND 1 million) or 15% (for medicines priced at VND 1 million and above) compared to winning bid prices in tenders.
      • The announced or re-announced price is higher than prices in the country of origin or other markets (if there’s no similar product in Vietnam).
      • When such differences are found, the MOH issues a formal recommendation to the announcing business and publishes it online for transparency and accountability.

      Further Guidance in New Circular

      On 1 July 2025, the MOH issued Circular No. 31/2025/TT-BYT (Circular 31), which further details how the amended Law on Pharmacy and Decree 163 should be implemented. Circular 31 officially replaces Circular No. 07/2018/TT-BYT and Decree 54 and came into effect immediately.

      Key provisions of Circular 31 include:

      Notification of Practising Pharmacists

      Pharmaceutical businesses that are not part of a pharmacy chain must inform the relevant authority of a list of people currently working at the business who hold pharmacy practice certificates. This notification must be submitted within 15 days of the date the certificate allowing the pharmaceutical business to operate was issued, or when there are any changes to the list. This is a shorter deadline than the previous 30 days under earlier rules.

      Pharmacy chains have similar notification duties and deadlines. Specifically, the chain operator must inform the provincial authority where each pharmacy in the chain is located about the list of practising pharmacists at those sites. Additionally, pharmacy chains must notify the authority if pharmacies are added or removed from the chain, and if there are any rotations of the people responsible for pharmaceutical expertise between pharmacies within the chain.

      Medicine Information Activities

      Under Circular 31, medicine information can still be given to healthcare professionals through information materials, seminars, and medical representatives.

      However, Circular 31 introduces a significant change by removing the need to obtain a certificate for medicine information content before carrying out these activities. Under the new rules, pharmaceutical businesses, representative offices of foreign pharmaceutical companies in Vietnam, and MA holders are now responsible for creating and distributing medicine information materials. These materials must comply with the package inserts for medicines approved by the MOH, the Vietnamese National Drug Formulary, and any related documents and professional instructions issued or recognised by the MOH.

      Donald Trump, never one to shy away from drama or diplomacy-via-caps-lock, has slapped a 50% tariff on all Brazilian exports to the United States. The justification? In his own delicate prose: „The treatment of former President Jair Bolsonaro is a disgrace… A witch hunt that must end IMMEDIATELY!“

      And just in case anyone thought this was about trade imbalances or economic strategy, Trump made things crystal clear: „Due to Brazil’s insidious attacks on free elections…“.

      In short, the 50% tariff isn’t about coffee, orange juice, or flip-flops. It’s about a Supreme Court judgment, applying Brazilian law, regarding Brazilian politicians accused of conspiring in a coup d’état. In other words, this is a brazen (and frankly absurd) attempt at judicial intervention via trade war.

      Trump, with his characteristic subtlety, offered a solution: manufacture in the U.S., and he’ll look kindly upon Brazil, like a mafia don offering „protection“ after smashing your shop window. But what he meant was: consider Bolsonaro innocent, and we’ll talk.

      The Brazilian market took the bait

      Although the fishy interference in Brazilian affairs was determined from a fish out of the water, the market took the bait: in the first 48 hours after the infamous letter, at least 1500 tons of fish were already held in Brazilian ports, as US buyers suspended their contracts due to uncertainty about the costs upon arrival. The fish market is on alert, as 80% of the exports head to the US, mainly coming from small family-owned industries that distribute the catch from artisanal fishing communities.

      The same effect hit other sectors, from orange, honey, and coffee to aircraft.

      Brazil’s response and sorcery: don’t mess with us (or our weather)

      Naturally, Brazil will not sit quietly sipping caipirinhas while its sovereignty is trampled. Reciprocity is on the table: if Washington raises tariffs, Brasília can do the same. But above all, one thing is sure: Brazil will never tolerate foreign interference in its independent judiciary.

      And then, a curious coincidence: right after Trump’s speech, a tornado accompanied by lightning struck the White House grounds. Pure chance? Maybe. Or could it have been the work of Brazilian indigenous shamans, a particularly well-organized group of umbanda practitioners, or simply the fact that, as every Brazilian child knows, God is Brazilian.

      Trump might want to check the weather forecast next time before penning another angry letter.

      The unpredictable becoming predictable

      Trade wars are rarely tidy affairs, but one thing they consistently deliver is chaos (in legal terms, disruption). And when disruption meets contracts, force majeure disputes often end up in court.

      At first glance, Trump’s decision to impose a 50% tariff overnight might feel like an unpredictable thunderbolt (quite literally, given the weather at the White House). But here’s the catch: by now, unpredictable tariffs are becoming predictable. When a government with a well-documented love for impulsive economic diplomacy imposes politically motivated tariffs, can anyone claim to be surprised?

      In most jurisdictions, force majeure requires that the event be extraordinary, unforeseeable, and beyond the parties’ control. A sudden 50% tariff certainly ticks a few of those boxes, but following a repetition of erratic trade policy, one might argue that businesses should expect what in past times was considered unexpected, especially when dealing with certain jurisdictions or political figures. In other words, Trump’s tariffs might not excuse performance if parties didn’t prepare for exactly this kind of volatility.

      This is where good contract drafting comes into play

      Savvy businesses are learning that their contracts must go beyond a vague boilerplate clause about “acts of government” or “changes in law.” Instead, they should expressly address the risk of sudden tariff changes, including

      • hardship clauses that allow renegotiation when costs become commercially unreasonable;
      • price adjustment mechanisms linked to tariff thresholds;
      • termination rights triggered by specified levels of customs duties;
      • currency fluctuation provisions (because tariffs rarely travel alone, and currency swings often accompany them).

      In short, while no contract can immunize a business from every shock, smart drafting can mean the difference between a commercial headache and a catastrophic breach.

      Therefore, tariffs may no longer be an unpredictable storm; they are part of the new predictable landscape. Given that your contract might wake up tomorrow facing ‘IMMEDIATE’ punitive tariffs in all caps, your contract should be ready today.

      The unwitting cupid: strengthening EU-Brazil relations

      While the tariffs may ruffle trade flows between Brasília and Washington, there’s an unintended silver lining: Trump is proving to be the most efficient matchmaker between Brazil and other markets, such as China and the European Union.

      The EU-Brazil relationship, already a flirtation with promising prospects, with relevant progress in the EU-Mercosur Agreement, now seems destined for deeper romance. If Mr. Trump insists on isolating the US from Brazil, the old continent stands ready, with flowers and wine in hand, to pick up where the US left off. After all, Brazilian fish can pair up nicely with champagne, cava and prosecco.

      So thank you, Mr. Trump. In your quest to bully Brazil into submission, you may have done more to strengthen transatlantic ties than any EU Commissioner ever could. As they say in Brasília these days: Trump is not a trade warrior. He’s a cupid in disguise.

      The recent announcement of a landmark trade agreement framework, following just three months negotiations since President Trump’s tariffs announcement on 2 April 2025, signals a pivotal shift, not merely in bilateral relations, but in the broader architecture of global supply chains.

      As a commercial lawyer with exposure to Vietnam since 2007, I have observed the evolving dynamics between the United States and Vietnam through the years, talking to students, entrepreneurs, veterans, diplomats, humans from all walks all life, from both nations and beyond.

      You may recall that Vietnam, with the notable exclusion of China, was to be the nation that would encounter the most stringent tariffs imposed by the Trump administration, reaching an astonishing 46%.

      The newly forged framework outlines significant reciprocal concessions designed to foster greater trade and investment flows. Granted, pre-April 2 tariffs applied by the USA on Vietnamese goods were lower than what emerges from the framework agreement, but still, it is better than 46%),

      The United States has committed to imposing a 20% tariff on most Vietnamese imports, a notable reduction from the previously mooted 46%. However, a substantial 40% tariff will apply to goods re-exported from third countries, with a particular focus on those originating from China.

      Vietnam has pledged to open its market to a wide array of US products. Crucially, it has also committed to implementing stringent measures aimed at restricting the transshipment of Chinese goods through its territory, a long-standing concern for Washington.

      In a significant win for American exporters, US goods will now enjoy duty-free access to the Vietnamese market, effectively granting “total access”, particularly for large-engine vehicles such as SUVs, as emphatically stated by President Trump (how SUVs are going to circulate in the narrow alleys of Hanoi and Ho Chi Minh City, infested by swarms of mopeds, is a different story).

      This agreement is expected to catalyse growth in several key sectors. Electronics, textiles, furniture, energy (especially Liquefied Natural Gas), and agriculture are poised for expansion. US firms specialising in manufacturing technology, energy solutions, and agricultural products are anticipated to be the primary beneficiaries. Furthermore, beyond immediate trade benefits, the agreement is set to reshape investment strategies, encouraging a greater localisation of supply chains within Vietnam. This strategic realignment is also expected to further solidify the already robust US-Vietnam Comprehensive Strategic Partnership.

      While the potential upsides are considerable, it is imperative for businesses and investors to approach this new landscape with a clear understanding of the accompanying risks. From my vantage point, I identify several significant execution challenges and structural impediments that require close monitoring.

      Enforcement of Transshipment Controls

      The most immediate and perhaps formidable risk lies in the effective enforcement of transshipment controls. Vietnam has historically served as a significant assembly point for Chinese-manufactured components. Ensuring that goods originating from China are not merely re-routed through Vietnam to circumvent US tariffs will require exceptionally close monitoring and robust verification mechanisms. The legal and practical complexities of definitively determining the true country of origin for all goods will undoubtedly pose a persistent challenge. As a European citizen, witnessing how the EU-Vietnam Free Trade Agreement (“EVFTA”), which poses an important stress on certificates of origin, I am particularly aware of this matter.

      While Vietnam has made remarkable strides in its economic development, certain structural issues could hinder its capacity to scale up high-value manufacturing in the short to medium term. These include:

      Legal framework nuances

      Vietnam’s legal framework for foreign investment has seen continuous improvements, but legal and cultural complexities and inconsistencies can and do still arise. Navigating the regulatory landscape, particularly with new rules stemming from this agreement and at a time of deep administrative, governmental, digital and legal reforms in Vietnam, will demand expert legal guidance to ensure compliance and mitigate potential fines and disputes. Issues surrounding so-called sublicences for businesses, intellectual property rights enforcement and contract enforceability, whilst improving, still require careful consideration;

      Education

      The ambition to transform Vietnam into a high-value manufacturing hub necessitates a workforce equipped with advanced skills. While the Vietnamese government prioritises education and workforce development, a significant portion of the current labour force lacks formal training and specialised certifications, let alone a good command of the English language. Bridging this skills gap, particularly in areas like advanced manufacturing, engineering, and digital technologies is a necessity and not just in light of this framework agreement. Companies may need to factor in substantial investment in training and upskilling programmes for their Vietnamese employees.

      Infrastructures

      Despite considerable investment, Vietnam’s infrastructure, particularly in logistics, energy, and transportation, continues to face bottlenecks. And China – the apparent target of Trump’s tariffs – is stepping in with high-speed trains connecting it to the northern Provinces of Vietnam. An increased volume of high-value manufacturing and trade will place further strain on existing infrastructure. Inadequate port capacity, congested roads, and a reliable energy supply (including for EV charging) are critical concerns that could impact efficiency and increase operational costs for businesses.

      Policy divergence

      This framework agreement deepens US-Vietnam trade ties and seems to be paving the way for more US investments in Vietnam, but this second aspect seems to run counter to parallel US policy objectives aimed at reshoring manufacturing back to the United States. This potential divergence in strategic priorities could introduce yet another element of unpredictability in the long term, necessitating a flexible and adaptable investment approach. Future shifts in US policy could impact the durability and full extent of the benefits derived from this agreement.

      This trade agreement, if finalised and implemented, undoubtedly represents a structural shift in global trade dynamics. It strategically positions Vietnam as an increasingly important high-value manufacturing hub and significantly deepens US engagement in Southeast Asia. We will need time, however, to assess the practical impact of the agreement, observing the efficacy of its implementation, and understanding how Vietnam’s inherent strengths and challenges will ultimately shape its role in the reconfigured global supply chain.

      We will also need to see what China, if anything, will do as a countermeasure. In fact, any assessment of Vietnam’s evolving trade landscape would be incomplete without a thorough consideration of China’s influence and strategic posture. President Xi Jinping has consistently championed a vision of a “community of shared future for mankind,” a concept that, while outwardly promoting global cooperation, also subtly underscores a demand for international alignment with Beijing’s interests. In the context of escalating trade tensions, Xi has repeatedly warned that “trade wars have no winners,” advocating for unity against protectionist measures, yet simultaneously implying that nations must ultimately choose sides, either with or against China’s economic and political orbit. Vietnam, despite its historical complexities and occasional maritime disputes with Beijing in the South China Sea (or East Sea, as it is officially called by Hanoi), remains deeply interwoven with China’s economy. China has been Vietnam’s largest trading partner for many years, with significant inflows of Chinese FDI, loans, and project contractors. This economic dependency is particularly evident in various sectors, where Chinese components and materials form a substantial part of Vietnamese manufacturing supply chains. While Vietnam has actively sought to diversify its trade partners and reduce its reliance on China, the sheer scale of the bilateral economic relationship means that disentanglement is a long-term, complex endeavour. Furthermore, China’s influence extends beyond direct trade into crucial regional resources. The Mekong River, a lifeline for millions in Southeast Asia, originates in China, which has constructed numerous upstream dams.

      As Vietnam navigates its enhanced trade relationship with the United States, it must simultaneously contend with the enduring economic gravity and strategic ambitions of its northern giant neighbour. Any perceived move by Vietnam to significantly shift away from China could invite retaliatory measures or heightened pressure from Beijing. Businesses investing in Vietnam must not only grasp the intricacies of the US-Vietnam agreement but also meticulously analyse how these developments will intersect with, and potentially be impacted by, the intricate, often delicate, and sometimes fraught relationship between Hanoi and Beijing. Understanding this geopolitical tightrope will be essential for sustainable success in the Vietnamese market. Prudence, informed legal counsel, and a keen eye on evolving geopolitical and economic realities will be paramount for those seeking to capitalise on this transformative new chapter.

      Takeaways

      • Tariffs:The US-Vietnam framework agreement marks a significant departure from previous trade dynamics, reducing US tariffs on most Vietnamese imports to 20% (from a mooted 46%) while imposing a 40% tariff on transshipped goods, especially from China.
      • Vietnam’s market opening:Vietnam has committed to duty-free access for a broad range of US products and stricter controls on Chinese goods transiting its territory.
      • Growth / manufacturing shift potential:The agreement is expected to fuel expansion in Vietnamese electronics, textiles, furniture, energy (LNG), and agriculture. It also encourages supply chain localisation within Vietnam (normally more of an assembly point for Chinese products).
      • Execution challenges: Effectively preventing the re-routing of Chinese goods through Vietnam to avoid tariffs will be a complex and demanding task; Despite economic progress, Vietnam faces hurdles in scaling high-value manufacturing due to legal framework nuances (e.g., sublicences, IP enforcement), a skills gap in its workforce (lack of formal training, English proficiency) and infrastructure bottlenecks (logistics, energy, transportation).
      • US policy divergence:The agreement’s encouragement of US investment in Vietnam appears to contradict the broader US policy objective of reshoring manufacturing.
      • China:Businesses must consider China’s significant economic sway over Vietnam, including its position as Vietnam’s largest trading partner, its FDI, and its control over shared resources like the Mekong River. Any major shift by Vietnam away from China could lead to retaliatory measures from Beijing.
      • Uncertainty:This is not a final agreement, so the situation might change. Prudence and informed legal counsel are crucial for businesses navigating this evolving landscape.

      The Trump approach: power and dominance

      In his autobiography, The Art of the Deal, Donald Trump describes negotiation as a contest of strength, determination, and dominance. His vision is clear: anyone who shows uncertainty or makes concessions too early is immediately perceived as a loser. His negotiating style is based on constant pressure, maximalist demands, and calculated threats, to obtain unilateral advantages. In this scheme, compromise is not a point of arrival, but a sign of weakness to be avoided.

      Trump has always been a competitive negotiator, focused on immediate results and uninterested in balanced solutions unless they are strictly functional to his interests.

      Other negotiating styles: compromising and collaborative

      In contrast to this competitive approach, there are two other relevant negotiating styles:

      • The compromising style aims to reach a ‘middle ground’ agreement, in which both parties give something up to achieve an acceptable solution. It is a pragmatic approach, practical in situations where time is limited or positions are too far apart for genuine collaboration.
      • The collaborative style, on the other hand, aims to create win-win solutions. The parties seek to thoroughly understand each other’s interests and work together to build an outcome that maximizes the benefit for both. It requires openness, time, and trust.

      In commercial negotiations, the compromising or collaborative approach can only work if the other party shares the same logic. But when dealing with an explicitly competitive actor such as Trump, adopting a compromising style risks seriously penalizing the other party, for at least three reasons:

      • It conveys weakness

      An accommodating gesture is seen not as a sign of openness, but as a point of pressure to be exploited. The competitive negotiator, focused on gaining an immediate advantage, interprets it as a willingness to give even more.

      • It relinquishes bargaining power

      The EU has a vast market and significant trade levers, especially in a context where the US is closing the door to the Chinese market. Offering concessions at the outset is tantamount to burning your cards without getting anything in return. In a competitive confrontation, the first move can set the tone for the negotiation: once a concession has been made, it is very difficult to backtrack.

      • It legitimizes the negotiating imbalance

      An unbalanced compromise, if accepted without resistance, risks becoming the new basis for future trade relations, systematically penalizing the EU in subsequent rounds.

      Why 30%? The anchor technique

      Trump often uses a negotiating technique known as the anchor technique. This consists of deliberately setting a very high target at the beginning of the negotiation (in our case, the threat of 30% tariffs).

      The aim is to create a psychological perimeter for the negotiation and force the other party to reason on the basis of that figure, even though they are aware that it is arbitrary. This technique allows one to influence the scope of the discussion and obtain greater concessions, just as Trump has done.

      The worst response: unilateral concessions with no return

      Unfortunately, the European Union has already shown worrying signs of a compromising attitude that has not been negotiated with the Trump administration, for example:

      • The waiver of the web tax* on American digital giants, without obtaining any regulation or shared tax contribution in return.
      • The offer to increase imports of liquefied natural gas (LNG) from the US, made to reassure Washington, without obtaining anything in return.
      • The acceptance of the increase in NATO spending to 5% of GDP, demanded by Trump, again without obtaining anything in return.

      All these offers without asking for anything in return reinforce the idea that the EU is willing to concede from the outset. Trump, true to his competitive logic, sees these concessions as a starting point, not a compromise: this pushes him to raise his demands, not moderate them.

      Persevering would be a fatal mistake

      Continuing along this path of compromise, in the hope that accommodation will ease the pressure, would be not only ineffective but counterproductive. With a competitive negotiator, unilateral concessions do not stop escalation: they fuel it. Any sign of weakness is interpreted as additional room for maneuver.

      A helpful example is China’s reaction during the trade war initiated by Trump. Faced with massive tariffs imposed by the US, Beijing responded in kind, imposing equivalent tariffs. Instead of giving in, it spoke the same language of power. The result is there for all to see: after weeks of escalation, the US had to moderate its position, opening up to a more balanced agreement.

      The right strategy: speak his language

      To avoid the mistakes of the past, the EU should therefore reverse its negotiating logic. Not to fuel confrontation, but to restore a credible balance. Some applicable countermeasures could be:

      • Target Trump’s electoral base, particularly the agricultural sectors (soy, corn, beef), with selective tariffs or targeted restrictions.
      • Put the European web tax* back on the table, even with a minimum rate, linking any exemptions to real concessions from the US.

      These well-calibrated moves would strengthen the EU’s position and show that it can defend its interests by speaking a language Trump understands: that of strength and bargaining power.

      Going beyond requests, seeking the other party’s interests

      A fundamental principle in any negotiation is to identify the other side’s interests and find a way to allow them to achieve them without sacrificing your own. This is no easy task, given Trump’s notorious volatility and the lack of sound arguments to justify the demands made in the negotiations.

      In the case of the EU-US negotiations, it must be borne in mind that Trump is playing the game with his electoral base in mind: an agreement must offer him a narrative of victory to communicate to his electorate.

      Takeaway

      When negotiating with a competitive player like Trump, one should abandon the accommodating approach, avoid concessions without something in return, and adopt a style that is more assertive, strategic, and symmetrical.

      Only then will it be able to build an agreement that is solid, fair, and respectful of its economic and political strength.

      I have often dealt with commercial distribution agreements between Italian and Chinese companies, sometimes following negotiations in the wine sector for various types of agreements: sales, distribution, franchising, establishment of joint ventures, and sales through online stores.

      I am sharing some key considerations for approaching this complex but opportunity-rich market.

      📌 Here are my 10 takeaways

      Step Zero. Protect your IP

      it is essential to protect your intellectual property before entering China. This includes trademarks (including their Chinese transliteration), labels, web domains, and social media accounts. Neglecting this aspect can have disastrous consequences, exposing you to the widespread phenomenon of trademark squatting (even famous names such as Michael Jordan, Elon Musk, and Donald Trump have fallen victim to this).

      For more information, you can read this article about Intellectual property protection in China

      1 – Know your enemy

      trust is good, but mistrust is better. Before entering into commercial agreements, it is essential to check the credentials of potential partners through the databases of the State Administration for Industry and Commerce. When it comes to wine, it is necessary to check whether the prospective distributor has a license to import and distribute wine.

      2 – No copy-paste

       Contracts must be tailor-made, adapting them to local specificities. In particular, it is crucial to clearly regulate promotional activities: budget, commercial actions, communication methods, and management of the producer’s trademarks. It is also best to write the contract in Chinese to ensure that there are no misunderstandings and in case it needs to be used before a judge or local administrative body, as Chinese is the only official language. (N.B.: if you think of entrusting the task to ChatGPT, this is not a good idea).

      For an in-depth article, check out The commercial distribution contract in China

      3 – Decide immediately how and where to litigate

      It may seem counterintuitive, but it is best to avoid providing for Italian (or French, or German) jurisdiction and applicable law, which is an ineffective solution, especially in cases where urgent action is needed to stop unfair competition or counterfeiting. Consider applying Chinese law and provide for an arbitration clause at CIETAC. An effective dispute management strategy is a key element of the agreement and must be negotiated carefully. (P.S.: This applies not only to China but to all international agreements. For more information, see this article).

      4 – China is big

      And it is the sum of many very different internal markets. Exclusivity should be granted for good reasons, but only if the distributor has a well-developed commercial network and can achieve specific shared objectives. If granted, it should be limited to the province where the distributor is based and subject to the achievement of agreed sales volumes. Having a single distributor for the whole of China is like entrusting an Italian distributor with promoting a product throughout Europe. Or appoint a NYC-based company to promote and sell your wines in all 50 US States.

      5 – China is far away

      Delegating everything to the local distributor and taking no interest in what is happening on the Chinese market is never a good idea. Firstly, because you have no idea how, where, and with what results the wines are being sold. Secondly, because you cannot verify compliance with agreements, for example on non-competition or the use of trademarks. It is therefore important to schedule meetings to share commercial policies and be able to verify what is happening, including through audits and visits to warehouses and the sales network.

      6 – China is expensive

      Competition in the Chinese domestic market is fierce. This is also true in terms of price, as some countries that are direct competitors of Italy (Australia, Chile, New Zealand) have free trade agreements and can therefore enter the market on more favorable terms than Italian wine, which is subject to a total tax burden of around 43% after payment of duties, excise taxes, and VAT. It is necessary to position oneself in the right market segment (medium-high), and to do so, it is necessary to plan the right commercial actions together with the distributor. Selling Ex-Works and hoping that the distributor will take care of everything is not an excellent strategy for being competitive.

      7 – China is dangerous

      Scams are always around the corner. In the wine world in particular, for example, spontaneous expressions of interest are frequent, arriving via the company website, social media accounts, or directly via email. They sound like this: we have discovered your wines, we think they are fantastic, we want to place an order immediately. If it sounds too good and easy, it is certainly a scam. There is an easy way to check: if the next step is a request for payment of a few thousand euros, justified by the need to register the wines on the CIFER (China Imported Food Enterprise Registration) portal, or to register your trademark to prevent others from doing so, or to authenticate the signature on the sales contract… these are attempts at fraud, and the elusive order will never arrive after payment has been received. How can you check whether the person you are dealing with is a reputable company or a fraudster? 👉🏼Go back to point 1 (here is an in-depth article).

      8 – E-commerce? Yes, but with method (and money)

      Online wine sales continue to grow, but entering large platforms is complex, competition is fierce, and running an online store requires meticulous planning and highly efficient system implementation. The online market in China is all pay-for-play. Nothing is achieved with no money or minimal effort. If you want to sell online, you need to build an omnichannel system integrated with traditional distribution, and to do this, it is essential to involve a local partner with well-defined investments and responsibilities.

      9 – China is not a market for everyone

      You need to protect your brands, study the market thoroughly, know your competition (both foreign and local), find the right market channel, select a distributor motivated to invest time and money in promoting your product, and be willing to support them with the right investments. If you want to build a serious plan to enter the Chinese market, you must have a medium- to long-term perspective. There are no shortcuts (actually, there are many, but they almost always lead to wasted time and money). If you are unwilling to invest in entering the Chinese market through the front door, it is unlikely that anyone else will do it for you.

      10 – Don’t do it yourself

      If you have read up to point 9 and are still keen to enter the Chinese market, consider doing so professionally, involving consultants who can support your company throughout the market research, scouting, negotiation, and contract drafting processes. This is also part of the investment needed to build and develop a solid and resilient business model. This advice applies to all foreign markets, and even more so to China.

      The most dangerous mistake one can make after the announcement of the (partial) suspension of U.S. duties for 90 days is to hope that everything will go well and we will return to the pre-April 2 world.

      First, because very invasive tariffs remain in place: 10 percent on all countries that trade with the U.S., including the EU, 25 percent on automotive, 25 percent on steel and aluminum, 145 percent on China.

      Second, because it is impossible to predict the actions of the U.S. Administration in the short and medium term: it cannot be ruled out that tariffs will remain, increase, change targets or that other factors will intervene to turn the tide in international markets, such as an escalation of the trade war with China.

      The 90-day suspension is an opportunity

      The U.S.’s temporary suspension of tariffs represents a valuable window that should be used not only as a truce but also as a valuable room for action: 90 days to rehash contracts, renegotiate key clauses, and insert levers of flexibility that can protect business in various future scenarios in the U.S. and other markets.

      Today’s exporters cannot afford to „sit back and see what will happen“-it is time to act, and to do so professionally and strategically. Let’s look at a checklist of important points to consider.

      What do contracts with customers and suppliers entail?

      The first point is to survey agreements with the trade network in the U.S. and other countries that export to the U.S., as well as with upstream suppliers in the supply chain.

      Is there a written contract? The worst-case scenario – unfortunately a very frequent one – is when the parties cooperate informally, only based on orders and order confirmations. This leaves undefined not only what happens in the case of imposition of duties, but also a whole range of other points, for example, limits on damages that can be claimed in the case of breach of contract, the duration of the agreement, the applicable law, and how any disputes will be resolved.

      Another very problematic scenario is one in which contracts exist, but they are generic and do not include the necessary covenants to manage the risks involved in operating in a highly litigious market such as the U.S., which, moreover, has very high legal costs.

      Having done this analysis, the necessary actions can be put in place, prioritizing according to the importance of business relationships and as appropriate:

      • Negotiate and conclude a written contract from scratch
      • Replace the existing agreement with a complete and correct contract
      • Amend and integrate the existing agreement with pacts to manage tariffs and other causes of price fluctuations

      Let us dwell on the last scenario, assuming that there is a complete and correct contract but one that does not regulate price and cost fluctuation as a direct or indirect consequence of the introduction of duties.

      Contract Addendum

      In such cases, the correct course of action is to sign an Addendum to the original contract, specifying which covenants are being waived and which covenants are being added. It is essential that the Addendum be negotiated and signed by persons with the power of representation of the parties and that it be drafted with the help of lawyers who specialize in this field. In addition to including correct clauses, it is necessary to verify that the covenants are valid according to the rules of law applicable to the contract.

      Here are some clauses that can be the subject of the Addendum, to be modulated according to the specific case and possible scenarios.

      Tariff Cost Sharing

      By introducing this covenant, it is provided that in the event that duties are confirmed at [x]% or are reduced or increased within certain established thresholds, the Parties will share the increase equally, or according to other established percentages.

      There may also be a ceiling on tariffs beyond which a party has the right to withdraw from the contract or request the suspension of certain orders for a specified period of time, after which it has the right to withdraw.

      Price Adjustment

      With this covenant, a discount or an increase in the product’s price is agreed upon, as the case may be, in the case of a duty greater than [x]%.

      Among the use cases, in addition to that of the company exporting to the U.S. or other intermediate markets, with final destination of the products in the U.S., is that of those who purchase a product subject to import duty and resell it, processed or assembled.

      Right to Cancel or Postpone Confirmed Orders

      This covenant gives the right to revoke or suspend for a certain period already negotiated orders, as such binding, in case of confirmation or introduction of duties above a certain threshold, for example, if 20% taxation was confirmed for the import of wine from the EU.

      The clause can be combined with previous covenants, for example, by stipulating that below the specified threshold, the contracts remain valid, and the parties share the duty or have the right to renegotiate the price.

      Supply Forecast Adjustment

      With this clause the Parties can modify supply programs already agreed for a specific duration (e.g., 24 months), with continuous sales and purchase obligations at a fixed price or indexable only within certain limits. The aim is to agree on the prerequisites for reshaping supply programs in the short and medium term, which can be very useful for defining the rules that will apply to relationships with key suppliers or customers for possible changes in volumes, delivery times, and prices.

      Right to Source from Alternative Suppliers

      This covenant serves to be authorized, if necessary, to source alternative suppliers of components or raw materials to those previously authorized in the contract with the end customer, for example, in cases where purchasing from the original suppliers has become too costly or difficult due to duties imposed at import or in previous steps in the supply chain, or other events such as currency or price fluctuation of certain commodities beyond a certain level established in the agreement.

      Hardship and Force Majeure

      The imposition of duties cannot be invoked as a cause of Force Majeure or hardship, respectively, to excuse contract non-performance or to renegotiate the price, even in cases of very high price increases (such as the 145% duty imposed on Chinese products). This conclusion is almost uniform under the law and jurisprudence of the major countries involved in the tariff war: U.S., China, Canada, Mexico, France and Italy: I refer to this practical guide for a timely examination of what the various rules provide.

      If the contract lacks a well drafter Force Majeure and Hardship clause, or contains a generic clause, it is important to get your hands on revising it to expressly state the cases in which a party is entitled to suspend or terminate the contract, how and when to communicate the decision to invoke the exemption, and the consequences on the parties‘ contractual obligations. You can go deeper on this topic here.

      Conclusion

      It is essential to prepare for possible future scenarios regarding duties (confirmed, increased, changed, or decreased) and to determine the consequences on trade relations with foreign clients and suppliers: moving today, at a standstill (or nearly so), allows entrepreneurs to negotiate shared and fair solutions and to avoid, as far as possible, the emergence of tensions and conflicts with the various partners along the international supply chain.

      Geraldo Fonseca

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        Assessing the US-Vietnam Framework Agreement on Trade

        13. Juli 2025

        • USA
        • Vietnam
        • Vertrieb
        • Steuer

        It is quite common for business relationships with agents or distributors to last for years without any signed documents. And be careful, because we know that a contract can exist even verbally.

        The absence of a written contract will add difficulties in the event of a possible claim, so what you do between the decision to terminate, and the moment of the claim is very important. Remember: ‘anything you write will be used against you’.

        The decision to terminate a business relationship is a very delicate moment to which, for some reason, solicitors are not invited. Here are some examples (all real) in which companies or employees with the best of intentions wrote to the agent/distributor. All of them were subsequently very damaging to the company:

        Saying ‘We are terminating our business relationship’ when the strategy will be to argue that no such business relationship exists, but rather that there are separate and linked contracts (e.g., supply rather than ongoing distribution contract; very significant compensation consequences).

        ‘You no longer represent our company’, which may be evidence that you did so before.

        ‘As of day X, you may no longer act on behalf of our company,’ which would prove that you were previously able to act on its behalf.

        ‘You may not attend the X trade fair on our behalf.’ A way of confirming that the agent/distributor’s responsibilities included participating in trade fairs and probably accrediting the customers obtained.

        ‘The sales you promoted have been significantly reduced in year N.’ When there is no written contract or other form of documentation, imputing a breach of an obligation that is not clear can be counterproductive.

        Saying ‘You are not actively promoting our products’ and then adding: ‘We urge you to stop promoting the sale of our products’.

        ‘You are no longer our exclusive representative’, which proves a type of relationship (representation/agent) and a tacit or express agreement (‘exclusivity’).

        ‘We have appointed another representative in your area’, which shows that the agent/distributor had an assigned area and was “representing”.

        ‘From this moment on, orders will be handled by X’, which also confirms a type of relationship.

         

        In summary: from the moment the company considers terminating a commercial relationship, especially when it is not in writing and before sending any letter, it is advisable to think carefully about the strategy in case of a possible claim. This is the best time to seek advice and avoid surprises. Any communication that is not in line with this strategy designed from the outset can only lead to confusion and problems.

        Remember the USA – EU agreement on 15% tariffs? I wrote that with a negotiator like Trump the game is never over (article here) and—after the recent interlude featuring a threat of 100% tariffs on pharmaceuticals—the U.S. government has announced the imposition of an overall 107% duty on Italian pasta, which could take effect on January 1, 2026.

        Where this new duty comes from

        The antidumping investigation was launched by the U.S. Department of Commerce at the request of certain competing American companies and is based on a 1996 antidumping order that allows for periodic reviews of imports of Italian pasta. The Department of Commerce conducts these checks annually to assess whether Italian producers are selling pasta at prices lower than the U.S. domestic market, a practice known as “dumping.”

        Companies involved in the investigation

        The Department of Commerce selected two sample companies for in-depth analysis, defined as “mandatory respondents”: La Molisana and Pastificio Lucio Garofalo. According to the official document published by the U.S. administration, for the period from July 1, 2023 to June 30, 2024, both companies allegedly sold their products below market prices, resulting in the imposition of a duty of 91.74%.

        U.S. authorities justified this percentage by claiming the two companies did not provide complete or compliant information as requested by the Department and were therefore insufficiently cooperative during the investigation. What is very important is that, in addition to the two companies directly examined, the additional 91.74% duty is also applied to numerous other Italian producers not individually reviewed. This methodology, while formally permitted under U.S. law as an exception, is being applied without any direct verification of the other companies.

        Next steps in the procedure

        Italy’s Ministry of Foreign Affairs moved immediately, formally intervening in the proceeding as an “interested party” through the Italian Embassy in Washington. The Foreign Ministry is working in close coordination with the companies concerned and, in concert with the European Commission, to persuade the U.S. Department to revise the provisional duties.

        The two companies involved (La Molisana and Garofalo) can submit documentation to contest the dumping allegations. However, if dumping is confirmed, the Department of Commerce will instruct Customs to apply antidumping duties on goods sold and entered into U.S. commerce.

        The preliminary nature of this determination means there is still room to change the decision before it becomes final.

        Possible effective date

        The new super-duty of 91.74%, which will be added to the existing 15% tariff for a total of 107%, is scheduled to take effect on January 1, 2026. This date therefore represents a crucial deadline for all ongoing diplomatic and legal actions.

        If confirmed, the economic impact would be significant: in 2024, Italian pasta exports to the United States reached a value of €671 million according to Coldiretti, accounting for nearly 17% of the sector’s total exports. A 107% duty would risk seriously undermining competitiveness in one of the most important markets for Italian agri-food products.

         What to do between now and January 1, 2026?

        At this stage, the entry into force of the new duty depends on the outcome of the ongoing procedure: given what has happened in recent months, and the political use the U.S. administration has made of tariffs—well beyond their technical function—it is reasonable to be pessimistic.

        So, what to do? In recent months we have seen companies react to the uncertainty over the fate of the tariffs in three ways:

        • Some rushed to ship as many products as possible before the potential effective date of the duty;
        • Some granted—upfront—discounts equivalent to the threatened duty, in case it came into force;
        • Some suspended orders, pending definitive news on the impact of the duties.

        These are all  valid options, but other effective tools for managing the uncertainty caused by the flurry of announcements, negotiations, and threats from the U.S. administration should not be forgotten: the risk of new duties being introduced, or existing ones being increased, can be managed in the contract by agreeing with the U.S. importer how any tariff change will affect the product.

        The parties can stipulate, for example, that the increase will be split equally; or that the importer will bear it beyond a certain threshold; or that if the duty exceeds a certain level, the contracts may be terminated. You can find a deeper dive in this article.

        The only certainty is that trade relations with the U.S. will stay unpredictable for a long time, and it’s vital to carefully manage the risk factors involved in selling products there. Right now, the focus is on tariffs and prices, and I encourage you to take this chance to thoroughly review existing agreements and assess whether—and how—other important points are addressed that could entail significant liabilities: we discuss them, very practically, in this book.

        On 29 June 2025, the Vietnamese government introduced Decree No. 163/2025/ND-CP (Decree 163). This decree provides detailed guidance on how the updated Law on Pharmacy will be implemented.

        Like the amended Law on Pharmacy, Decree 163 came into effect on 1 July 2025, replacing the previous Decree No. 54/2017/ND-CP (Decree 54). The new decree sets out comprehensive rules for key aspects of managing pharmaceuticals, including:

        • Pharmacy practice certificates
        • Certificates allowing pharmaceutical businesses to operate
        • Import and export of medicines and drug ingredients
        • Good Manufacturing Practice (GMP) inspections of overseas manufacturers
        • Recalling medicines and drug ingredients
        • Certificates for medicine advertising content
        • Medicine price management

        Key Changes in Decree 163

        Here are some important changes and additions introduced by Decree 163:

        Destroying Specially Controlled Medicines

        You no longer need to get approval from the relevant authority before destroying narcotic, psychotropic, and precursor drugs, or pharmaceutical ingredients that are narcotic or psychotropic substances or precursors used in medicines. Instead, you just need to provide notification at least seven working days in advance. This notification must include the planned destruction date and a detailed list of items to be destroyed.

        E-commerce in Pharmaceutical

        Pharmaceutical businesses that sell products online must openly display the following information to ensure transparency and consumer safety:

        • Their certificate allowing them to operate as a pharmaceutical business.
        • The pharmacy practice certificate of the person responsible for pharmaceutical expertise.
        • Information about the medicines themselves.

        Shelf-Life Rules for Imported Products

        For medicines and ingredients with a total shelf life of nine months or less, at least one-third of their shelf life must remain when they clear customs. Medicines with a shelf life of 30 days or less must still be within their shelf life at the time of customs clearance.

        Controlling Imported Products

        All medicines with marketing authorisation (MA) are subject to import control, except for:

        • Medicines needed for preventing and treating Group A infectious diseases that have been declared epidemics, as per the Law on Prevention and Control of Infectious Diseases.
        • Medicines with a shelf life of less than 30 days.

        Importers must inform the provincial People’s Committee at least five working days before making a customs declaration. The People’s Committee can then issue a written notice of non-compliance to the customs authority within five working days of receiving this notification.

        Medicine Advertising

        Decree 163 adds a process that allows an approved medicine advertising certificate to be adjusted for certain changes (such as a change to the MA holder or manufacturer information). This means you don’t have to go through the entire initial registration process for medicine advertising content again, as was required under the previous rules.

        Medicine Price Management

        Businesses must announce or re-announce wholesale prices, similar to the medicine price declaration process under Decree 54. Some medicines are exempt from this requirement, including those provided free of charge for emergency responses, national health programmes, humanitarian aid, clinical trials, scientific research, or exhibition purposes, and medicines carried as personal luggage.

        The Ministry of Health (MOH) can make recommendations if the announced or re-announced price is significantly higher than similar medicines already on the market. This includes situations where:

        • The announced or re-announced wholesale price of the medicine is higher than the highest price of similar medicines.
        • The price difference is more than 35% (for medicines priced under VND 1 million) or 15% (for medicines priced at VND 1 million and above) compared to winning bid prices in tenders.
        • The announced or re-announced price is higher than prices in the country of origin or other markets (if there’s no similar product in Vietnam).
        • When such differences are found, the MOH issues a formal recommendation to the announcing business and publishes it online for transparency and accountability.

        Further Guidance in New Circular

        On 1 July 2025, the MOH issued Circular No. 31/2025/TT-BYT (Circular 31), which further details how the amended Law on Pharmacy and Decree 163 should be implemented. Circular 31 officially replaces Circular No. 07/2018/TT-BYT and Decree 54 and came into effect immediately.

        Key provisions of Circular 31 include:

        Notification of Practising Pharmacists

        Pharmaceutical businesses that are not part of a pharmacy chain must inform the relevant authority of a list of people currently working at the business who hold pharmacy practice certificates. This notification must be submitted within 15 days of the date the certificate allowing the pharmaceutical business to operate was issued, or when there are any changes to the list. This is a shorter deadline than the previous 30 days under earlier rules.

        Pharmacy chains have similar notification duties and deadlines. Specifically, the chain operator must inform the provincial authority where each pharmacy in the chain is located about the list of practising pharmacists at those sites. Additionally, pharmacy chains must notify the authority if pharmacies are added or removed from the chain, and if there are any rotations of the people responsible for pharmaceutical expertise between pharmacies within the chain.

        Medicine Information Activities

        Under Circular 31, medicine information can still be given to healthcare professionals through information materials, seminars, and medical representatives.

        However, Circular 31 introduces a significant change by removing the need to obtain a certificate for medicine information content before carrying out these activities. Under the new rules, pharmaceutical businesses, representative offices of foreign pharmaceutical companies in Vietnam, and MA holders are now responsible for creating and distributing medicine information materials. These materials must comply with the package inserts for medicines approved by the MOH, the Vietnamese National Drug Formulary, and any related documents and professional instructions issued or recognised by the MOH.

        Donald Trump, never one to shy away from drama or diplomacy-via-caps-lock, has slapped a 50% tariff on all Brazilian exports to the United States. The justification? In his own delicate prose: „The treatment of former President Jair Bolsonaro is a disgrace… A witch hunt that must end IMMEDIATELY!“

        And just in case anyone thought this was about trade imbalances or economic strategy, Trump made things crystal clear: „Due to Brazil’s insidious attacks on free elections…“.

        In short, the 50% tariff isn’t about coffee, orange juice, or flip-flops. It’s about a Supreme Court judgment, applying Brazilian law, regarding Brazilian politicians accused of conspiring in a coup d’état. In other words, this is a brazen (and frankly absurd) attempt at judicial intervention via trade war.

        Trump, with his characteristic subtlety, offered a solution: manufacture in the U.S., and he’ll look kindly upon Brazil, like a mafia don offering „protection“ after smashing your shop window. But what he meant was: consider Bolsonaro innocent, and we’ll talk.

        The Brazilian market took the bait

        Although the fishy interference in Brazilian affairs was determined from a fish out of the water, the market took the bait: in the first 48 hours after the infamous letter, at least 1500 tons of fish were already held in Brazilian ports, as US buyers suspended their contracts due to uncertainty about the costs upon arrival. The fish market is on alert, as 80% of the exports head to the US, mainly coming from small family-owned industries that distribute the catch from artisanal fishing communities.

        The same effect hit other sectors, from orange, honey, and coffee to aircraft.

        Brazil’s response and sorcery: don’t mess with us (or our weather)

        Naturally, Brazil will not sit quietly sipping caipirinhas while its sovereignty is trampled. Reciprocity is on the table: if Washington raises tariffs, Brasília can do the same. But above all, one thing is sure: Brazil will never tolerate foreign interference in its independent judiciary.

        And then, a curious coincidence: right after Trump’s speech, a tornado accompanied by lightning struck the White House grounds. Pure chance? Maybe. Or could it have been the work of Brazilian indigenous shamans, a particularly well-organized group of umbanda practitioners, or simply the fact that, as every Brazilian child knows, God is Brazilian.

        Trump might want to check the weather forecast next time before penning another angry letter.

        The unpredictable becoming predictable

        Trade wars are rarely tidy affairs, but one thing they consistently deliver is chaos (in legal terms, disruption). And when disruption meets contracts, force majeure disputes often end up in court.

        At first glance, Trump’s decision to impose a 50% tariff overnight might feel like an unpredictable thunderbolt (quite literally, given the weather at the White House). But here’s the catch: by now, unpredictable tariffs are becoming predictable. When a government with a well-documented love for impulsive economic diplomacy imposes politically motivated tariffs, can anyone claim to be surprised?

        In most jurisdictions, force majeure requires that the event be extraordinary, unforeseeable, and beyond the parties’ control. A sudden 50% tariff certainly ticks a few of those boxes, but following a repetition of erratic trade policy, one might argue that businesses should expect what in past times was considered unexpected, especially when dealing with certain jurisdictions or political figures. In other words, Trump’s tariffs might not excuse performance if parties didn’t prepare for exactly this kind of volatility.

        This is where good contract drafting comes into play

        Savvy businesses are learning that their contracts must go beyond a vague boilerplate clause about “acts of government” or “changes in law.” Instead, they should expressly address the risk of sudden tariff changes, including

        • hardship clauses that allow renegotiation when costs become commercially unreasonable;
        • price adjustment mechanisms linked to tariff thresholds;
        • termination rights triggered by specified levels of customs duties;
        • currency fluctuation provisions (because tariffs rarely travel alone, and currency swings often accompany them).

        In short, while no contract can immunize a business from every shock, smart drafting can mean the difference between a commercial headache and a catastrophic breach.

        Therefore, tariffs may no longer be an unpredictable storm; they are part of the new predictable landscape. Given that your contract might wake up tomorrow facing ‘IMMEDIATE’ punitive tariffs in all caps, your contract should be ready today.

        The unwitting cupid: strengthening EU-Brazil relations

        While the tariffs may ruffle trade flows between Brasília and Washington, there’s an unintended silver lining: Trump is proving to be the most efficient matchmaker between Brazil and other markets, such as China and the European Union.

        The EU-Brazil relationship, already a flirtation with promising prospects, with relevant progress in the EU-Mercosur Agreement, now seems destined for deeper romance. If Mr. Trump insists on isolating the US from Brazil, the old continent stands ready, with flowers and wine in hand, to pick up where the US left off. After all, Brazilian fish can pair up nicely with champagne, cava and prosecco.

        So thank you, Mr. Trump. In your quest to bully Brazil into submission, you may have done more to strengthen transatlantic ties than any EU Commissioner ever could. As they say in Brasília these days: Trump is not a trade warrior. He’s a cupid in disguise.

        The recent announcement of a landmark trade agreement framework, following just three months negotiations since President Trump’s tariffs announcement on 2 April 2025, signals a pivotal shift, not merely in bilateral relations, but in the broader architecture of global supply chains.

        As a commercial lawyer with exposure to Vietnam since 2007, I have observed the evolving dynamics between the United States and Vietnam through the years, talking to students, entrepreneurs, veterans, diplomats, humans from all walks all life, from both nations and beyond.

        You may recall that Vietnam, with the notable exclusion of China, was to be the nation that would encounter the most stringent tariffs imposed by the Trump administration, reaching an astonishing 46%.

        The newly forged framework outlines significant reciprocal concessions designed to foster greater trade and investment flows. Granted, pre-April 2 tariffs applied by the USA on Vietnamese goods were lower than what emerges from the framework agreement, but still, it is better than 46%),

        The United States has committed to imposing a 20% tariff on most Vietnamese imports, a notable reduction from the previously mooted 46%. However, a substantial 40% tariff will apply to goods re-exported from third countries, with a particular focus on those originating from China.

        Vietnam has pledged to open its market to a wide array of US products. Crucially, it has also committed to implementing stringent measures aimed at restricting the transshipment of Chinese goods through its territory, a long-standing concern for Washington.

        In a significant win for American exporters, US goods will now enjoy duty-free access to the Vietnamese market, effectively granting “total access”, particularly for large-engine vehicles such as SUVs, as emphatically stated by President Trump (how SUVs are going to circulate in the narrow alleys of Hanoi and Ho Chi Minh City, infested by swarms of mopeds, is a different story).

        This agreement is expected to catalyse growth in several key sectors. Electronics, textiles, furniture, energy (especially Liquefied Natural Gas), and agriculture are poised for expansion. US firms specialising in manufacturing technology, energy solutions, and agricultural products are anticipated to be the primary beneficiaries. Furthermore, beyond immediate trade benefits, the agreement is set to reshape investment strategies, encouraging a greater localisation of supply chains within Vietnam. This strategic realignment is also expected to further solidify the already robust US-Vietnam Comprehensive Strategic Partnership.

        While the potential upsides are considerable, it is imperative for businesses and investors to approach this new landscape with a clear understanding of the accompanying risks. From my vantage point, I identify several significant execution challenges and structural impediments that require close monitoring.

        Enforcement of Transshipment Controls

        The most immediate and perhaps formidable risk lies in the effective enforcement of transshipment controls. Vietnam has historically served as a significant assembly point for Chinese-manufactured components. Ensuring that goods originating from China are not merely re-routed through Vietnam to circumvent US tariffs will require exceptionally close monitoring and robust verification mechanisms. The legal and practical complexities of definitively determining the true country of origin for all goods will undoubtedly pose a persistent challenge. As a European citizen, witnessing how the EU-Vietnam Free Trade Agreement (“EVFTA”), which poses an important stress on certificates of origin, I am particularly aware of this matter.

        While Vietnam has made remarkable strides in its economic development, certain structural issues could hinder its capacity to scale up high-value manufacturing in the short to medium term. These include:

        Legal framework nuances

        Vietnam’s legal framework for foreign investment has seen continuous improvements, but legal and cultural complexities and inconsistencies can and do still arise. Navigating the regulatory landscape, particularly with new rules stemming from this agreement and at a time of deep administrative, governmental, digital and legal reforms in Vietnam, will demand expert legal guidance to ensure compliance and mitigate potential fines and disputes. Issues surrounding so-called sublicences for businesses, intellectual property rights enforcement and contract enforceability, whilst improving, still require careful consideration;

        Education

        The ambition to transform Vietnam into a high-value manufacturing hub necessitates a workforce equipped with advanced skills. While the Vietnamese government prioritises education and workforce development, a significant portion of the current labour force lacks formal training and specialised certifications, let alone a good command of the English language. Bridging this skills gap, particularly in areas like advanced manufacturing, engineering, and digital technologies is a necessity and not just in light of this framework agreement. Companies may need to factor in substantial investment in training and upskilling programmes for their Vietnamese employees.

        Infrastructures

        Despite considerable investment, Vietnam’s infrastructure, particularly in logistics, energy, and transportation, continues to face bottlenecks. And China – the apparent target of Trump’s tariffs – is stepping in with high-speed trains connecting it to the northern Provinces of Vietnam. An increased volume of high-value manufacturing and trade will place further strain on existing infrastructure. Inadequate port capacity, congested roads, and a reliable energy supply (including for EV charging) are critical concerns that could impact efficiency and increase operational costs for businesses.

        Policy divergence

        This framework agreement deepens US-Vietnam trade ties and seems to be paving the way for more US investments in Vietnam, but this second aspect seems to run counter to parallel US policy objectives aimed at reshoring manufacturing back to the United States. This potential divergence in strategic priorities could introduce yet another element of unpredictability in the long term, necessitating a flexible and adaptable investment approach. Future shifts in US policy could impact the durability and full extent of the benefits derived from this agreement.

        This trade agreement, if finalised and implemented, undoubtedly represents a structural shift in global trade dynamics. It strategically positions Vietnam as an increasingly important high-value manufacturing hub and significantly deepens US engagement in Southeast Asia. We will need time, however, to assess the practical impact of the agreement, observing the efficacy of its implementation, and understanding how Vietnam’s inherent strengths and challenges will ultimately shape its role in the reconfigured global supply chain.

        We will also need to see what China, if anything, will do as a countermeasure. In fact, any assessment of Vietnam’s evolving trade landscape would be incomplete without a thorough consideration of China’s influence and strategic posture. President Xi Jinping has consistently championed a vision of a “community of shared future for mankind,” a concept that, while outwardly promoting global cooperation, also subtly underscores a demand for international alignment with Beijing’s interests. In the context of escalating trade tensions, Xi has repeatedly warned that “trade wars have no winners,” advocating for unity against protectionist measures, yet simultaneously implying that nations must ultimately choose sides, either with or against China’s economic and political orbit. Vietnam, despite its historical complexities and occasional maritime disputes with Beijing in the South China Sea (or East Sea, as it is officially called by Hanoi), remains deeply interwoven with China’s economy. China has been Vietnam’s largest trading partner for many years, with significant inflows of Chinese FDI, loans, and project contractors. This economic dependency is particularly evident in various sectors, where Chinese components and materials form a substantial part of Vietnamese manufacturing supply chains. While Vietnam has actively sought to diversify its trade partners and reduce its reliance on China, the sheer scale of the bilateral economic relationship means that disentanglement is a long-term, complex endeavour. Furthermore, China’s influence extends beyond direct trade into crucial regional resources. The Mekong River, a lifeline for millions in Southeast Asia, originates in China, which has constructed numerous upstream dams.

        As Vietnam navigates its enhanced trade relationship with the United States, it must simultaneously contend with the enduring economic gravity and strategic ambitions of its northern giant neighbour. Any perceived move by Vietnam to significantly shift away from China could invite retaliatory measures or heightened pressure from Beijing. Businesses investing in Vietnam must not only grasp the intricacies of the US-Vietnam agreement but also meticulously analyse how these developments will intersect with, and potentially be impacted by, the intricate, often delicate, and sometimes fraught relationship between Hanoi and Beijing. Understanding this geopolitical tightrope will be essential for sustainable success in the Vietnamese market. Prudence, informed legal counsel, and a keen eye on evolving geopolitical and economic realities will be paramount for those seeking to capitalise on this transformative new chapter.

        Takeaways

        • Tariffs:The US-Vietnam framework agreement marks a significant departure from previous trade dynamics, reducing US tariffs on most Vietnamese imports to 20% (from a mooted 46%) while imposing a 40% tariff on transshipped goods, especially from China.
        • Vietnam’s market opening:Vietnam has committed to duty-free access for a broad range of US products and stricter controls on Chinese goods transiting its territory.
        • Growth / manufacturing shift potential:The agreement is expected to fuel expansion in Vietnamese electronics, textiles, furniture, energy (LNG), and agriculture. It also encourages supply chain localisation within Vietnam (normally more of an assembly point for Chinese products).
        • Execution challenges: Effectively preventing the re-routing of Chinese goods through Vietnam to avoid tariffs will be a complex and demanding task; Despite economic progress, Vietnam faces hurdles in scaling high-value manufacturing due to legal framework nuances (e.g., sublicences, IP enforcement), a skills gap in its workforce (lack of formal training, English proficiency) and infrastructure bottlenecks (logistics, energy, transportation).
        • US policy divergence:The agreement’s encouragement of US investment in Vietnam appears to contradict the broader US policy objective of reshoring manufacturing.
        • China:Businesses must consider China’s significant economic sway over Vietnam, including its position as Vietnam’s largest trading partner, its FDI, and its control over shared resources like the Mekong River. Any major shift by Vietnam away from China could lead to retaliatory measures from Beijing.
        • Uncertainty:This is not a final agreement, so the situation might change. Prudence and informed legal counsel are crucial for businesses navigating this evolving landscape.

        The Trump approach: power and dominance

        In his autobiography, The Art of the Deal, Donald Trump describes negotiation as a contest of strength, determination, and dominance. His vision is clear: anyone who shows uncertainty or makes concessions too early is immediately perceived as a loser. His negotiating style is based on constant pressure, maximalist demands, and calculated threats, to obtain unilateral advantages. In this scheme, compromise is not a point of arrival, but a sign of weakness to be avoided.

        Trump has always been a competitive negotiator, focused on immediate results and uninterested in balanced solutions unless they are strictly functional to his interests.

        Other negotiating styles: compromising and collaborative

        In contrast to this competitive approach, there are two other relevant negotiating styles:

        • The compromising style aims to reach a ‘middle ground’ agreement, in which both parties give something up to achieve an acceptable solution. It is a pragmatic approach, practical in situations where time is limited or positions are too far apart for genuine collaboration.
        • The collaborative style, on the other hand, aims to create win-win solutions. The parties seek to thoroughly understand each other’s interests and work together to build an outcome that maximizes the benefit for both. It requires openness, time, and trust.

        In commercial negotiations, the compromising or collaborative approach can only work if the other party shares the same logic. But when dealing with an explicitly competitive actor such as Trump, adopting a compromising style risks seriously penalizing the other party, for at least three reasons:

        • It conveys weakness

        An accommodating gesture is seen not as a sign of openness, but as a point of pressure to be exploited. The competitive negotiator, focused on gaining an immediate advantage, interprets it as a willingness to give even more.

        • It relinquishes bargaining power

        The EU has a vast market and significant trade levers, especially in a context where the US is closing the door to the Chinese market. Offering concessions at the outset is tantamount to burning your cards without getting anything in return. In a competitive confrontation, the first move can set the tone for the negotiation: once a concession has been made, it is very difficult to backtrack.

        • It legitimizes the negotiating imbalance

        An unbalanced compromise, if accepted without resistance, risks becoming the new basis for future trade relations, systematically penalizing the EU in subsequent rounds.

        Why 30%? The anchor technique

        Trump often uses a negotiating technique known as the anchor technique. This consists of deliberately setting a very high target at the beginning of the negotiation (in our case, the threat of 30% tariffs).

        The aim is to create a psychological perimeter for the negotiation and force the other party to reason on the basis of that figure, even though they are aware that it is arbitrary. This technique allows one to influence the scope of the discussion and obtain greater concessions, just as Trump has done.

        The worst response: unilateral concessions with no return

        Unfortunately, the European Union has already shown worrying signs of a compromising attitude that has not been negotiated with the Trump administration, for example:

        • The waiver of the web tax* on American digital giants, without obtaining any regulation or shared tax contribution in return.
        • The offer to increase imports of liquefied natural gas (LNG) from the US, made to reassure Washington, without obtaining anything in return.
        • The acceptance of the increase in NATO spending to 5% of GDP, demanded by Trump, again without obtaining anything in return.

        All these offers without asking for anything in return reinforce the idea that the EU is willing to concede from the outset. Trump, true to his competitive logic, sees these concessions as a starting point, not a compromise: this pushes him to raise his demands, not moderate them.

        Persevering would be a fatal mistake

        Continuing along this path of compromise, in the hope that accommodation will ease the pressure, would be not only ineffective but counterproductive. With a competitive negotiator, unilateral concessions do not stop escalation: they fuel it. Any sign of weakness is interpreted as additional room for maneuver.

        A helpful example is China’s reaction during the trade war initiated by Trump. Faced with massive tariffs imposed by the US, Beijing responded in kind, imposing equivalent tariffs. Instead of giving in, it spoke the same language of power. The result is there for all to see: after weeks of escalation, the US had to moderate its position, opening up to a more balanced agreement.

        The right strategy: speak his language

        To avoid the mistakes of the past, the EU should therefore reverse its negotiating logic. Not to fuel confrontation, but to restore a credible balance. Some applicable countermeasures could be:

        • Target Trump’s electoral base, particularly the agricultural sectors (soy, corn, beef), with selective tariffs or targeted restrictions.
        • Put the European web tax* back on the table, even with a minimum rate, linking any exemptions to real concessions from the US.

        These well-calibrated moves would strengthen the EU’s position and show that it can defend its interests by speaking a language Trump understands: that of strength and bargaining power.

        Going beyond requests, seeking the other party’s interests

        A fundamental principle in any negotiation is to identify the other side’s interests and find a way to allow them to achieve them without sacrificing your own. This is no easy task, given Trump’s notorious volatility and the lack of sound arguments to justify the demands made in the negotiations.

        In the case of the EU-US negotiations, it must be borne in mind that Trump is playing the game with his electoral base in mind: an agreement must offer him a narrative of victory to communicate to his electorate.

        Takeaway

        When negotiating with a competitive player like Trump, one should abandon the accommodating approach, avoid concessions without something in return, and adopt a style that is more assertive, strategic, and symmetrical.

        Only then will it be able to build an agreement that is solid, fair, and respectful of its economic and political strength.

        I have often dealt with commercial distribution agreements between Italian and Chinese companies, sometimes following negotiations in the wine sector for various types of agreements: sales, distribution, franchising, establishment of joint ventures, and sales through online stores.

        I am sharing some key considerations for approaching this complex but opportunity-rich market.

        📌 Here are my 10 takeaways

        Step Zero. Protect your IP

        it is essential to protect your intellectual property before entering China. This includes trademarks (including their Chinese transliteration), labels, web domains, and social media accounts. Neglecting this aspect can have disastrous consequences, exposing you to the widespread phenomenon of trademark squatting (even famous names such as Michael Jordan, Elon Musk, and Donald Trump have fallen victim to this).

        For more information, you can read this article about Intellectual property protection in China

        1 – Know your enemy

        trust is good, but mistrust is better. Before entering into commercial agreements, it is essential to check the credentials of potential partners through the databases of the State Administration for Industry and Commerce. When it comes to wine, it is necessary to check whether the prospective distributor has a license to import and distribute wine.

        2 – No copy-paste

         Contracts must be tailor-made, adapting them to local specificities. In particular, it is crucial to clearly regulate promotional activities: budget, commercial actions, communication methods, and management of the producer’s trademarks. It is also best to write the contract in Chinese to ensure that there are no misunderstandings and in case it needs to be used before a judge or local administrative body, as Chinese is the only official language. (N.B.: if you think of entrusting the task to ChatGPT, this is not a good idea).

        For an in-depth article, check out The commercial distribution contract in China

        3 – Decide immediately how and where to litigate

        It may seem counterintuitive, but it is best to avoid providing for Italian (or French, or German) jurisdiction and applicable law, which is an ineffective solution, especially in cases where urgent action is needed to stop unfair competition or counterfeiting. Consider applying Chinese law and provide for an arbitration clause at CIETAC. An effective dispute management strategy is a key element of the agreement and must be negotiated carefully. (P.S.: This applies not only to China but to all international agreements. For more information, see this article).

        4 – China is big

        And it is the sum of many very different internal markets. Exclusivity should be granted for good reasons, but only if the distributor has a well-developed commercial network and can achieve specific shared objectives. If granted, it should be limited to the province where the distributor is based and subject to the achievement of agreed sales volumes. Having a single distributor for the whole of China is like entrusting an Italian distributor with promoting a product throughout Europe. Or appoint a NYC-based company to promote and sell your wines in all 50 US States.

        5 – China is far away

        Delegating everything to the local distributor and taking no interest in what is happening on the Chinese market is never a good idea. Firstly, because you have no idea how, where, and with what results the wines are being sold. Secondly, because you cannot verify compliance with agreements, for example on non-competition or the use of trademarks. It is therefore important to schedule meetings to share commercial policies and be able to verify what is happening, including through audits and visits to warehouses and the sales network.

        6 – China is expensive

        Competition in the Chinese domestic market is fierce. This is also true in terms of price, as some countries that are direct competitors of Italy (Australia, Chile, New Zealand) have free trade agreements and can therefore enter the market on more favorable terms than Italian wine, which is subject to a total tax burden of around 43% after payment of duties, excise taxes, and VAT. It is necessary to position oneself in the right market segment (medium-high), and to do so, it is necessary to plan the right commercial actions together with the distributor. Selling Ex-Works and hoping that the distributor will take care of everything is not an excellent strategy for being competitive.

        7 – China is dangerous

        Scams are always around the corner. In the wine world in particular, for example, spontaneous expressions of interest are frequent, arriving via the company website, social media accounts, or directly via email. They sound like this: we have discovered your wines, we think they are fantastic, we want to place an order immediately. If it sounds too good and easy, it is certainly a scam. There is an easy way to check: if the next step is a request for payment of a few thousand euros, justified by the need to register the wines on the CIFER (China Imported Food Enterprise Registration) portal, or to register your trademark to prevent others from doing so, or to authenticate the signature on the sales contract… these are attempts at fraud, and the elusive order will never arrive after payment has been received. How can you check whether the person you are dealing with is a reputable company or a fraudster? 👉🏼Go back to point 1 (here is an in-depth article).

        8 – E-commerce? Yes, but with method (and money)

        Online wine sales continue to grow, but entering large platforms is complex, competition is fierce, and running an online store requires meticulous planning and highly efficient system implementation. The online market in China is all pay-for-play. Nothing is achieved with no money or minimal effort. If you want to sell online, you need to build an omnichannel system integrated with traditional distribution, and to do this, it is essential to involve a local partner with well-defined investments and responsibilities.

        9 – China is not a market for everyone

        You need to protect your brands, study the market thoroughly, know your competition (both foreign and local), find the right market channel, select a distributor motivated to invest time and money in promoting your product, and be willing to support them with the right investments. If you want to build a serious plan to enter the Chinese market, you must have a medium- to long-term perspective. There are no shortcuts (actually, there are many, but they almost always lead to wasted time and money). If you are unwilling to invest in entering the Chinese market through the front door, it is unlikely that anyone else will do it for you.

        10 – Don’t do it yourself

        If you have read up to point 9 and are still keen to enter the Chinese market, consider doing so professionally, involving consultants who can support your company throughout the market research, scouting, negotiation, and contract drafting processes. This is also part of the investment needed to build and develop a solid and resilient business model. This advice applies to all foreign markets, and even more so to China.

        The most dangerous mistake one can make after the announcement of the (partial) suspension of U.S. duties for 90 days is to hope that everything will go well and we will return to the pre-April 2 world.

        First, because very invasive tariffs remain in place: 10 percent on all countries that trade with the U.S., including the EU, 25 percent on automotive, 25 percent on steel and aluminum, 145 percent on China.

        Second, because it is impossible to predict the actions of the U.S. Administration in the short and medium term: it cannot be ruled out that tariffs will remain, increase, change targets or that other factors will intervene to turn the tide in international markets, such as an escalation of the trade war with China.

        The 90-day suspension is an opportunity

        The U.S.’s temporary suspension of tariffs represents a valuable window that should be used not only as a truce but also as a valuable room for action: 90 days to rehash contracts, renegotiate key clauses, and insert levers of flexibility that can protect business in various future scenarios in the U.S. and other markets.

        Today’s exporters cannot afford to „sit back and see what will happen“-it is time to act, and to do so professionally and strategically. Let’s look at a checklist of important points to consider.

        What do contracts with customers and suppliers entail?

        The first point is to survey agreements with the trade network in the U.S. and other countries that export to the U.S., as well as with upstream suppliers in the supply chain.

        Is there a written contract? The worst-case scenario – unfortunately a very frequent one – is when the parties cooperate informally, only based on orders and order confirmations. This leaves undefined not only what happens in the case of imposition of duties, but also a whole range of other points, for example, limits on damages that can be claimed in the case of breach of contract, the duration of the agreement, the applicable law, and how any disputes will be resolved.

        Another very problematic scenario is one in which contracts exist, but they are generic and do not include the necessary covenants to manage the risks involved in operating in a highly litigious market such as the U.S., which, moreover, has very high legal costs.

        Having done this analysis, the necessary actions can be put in place, prioritizing according to the importance of business relationships and as appropriate:

        • Negotiate and conclude a written contract from scratch
        • Replace the existing agreement with a complete and correct contract
        • Amend and integrate the existing agreement with pacts to manage tariffs and other causes of price fluctuations

        Let us dwell on the last scenario, assuming that there is a complete and correct contract but one that does not regulate price and cost fluctuation as a direct or indirect consequence of the introduction of duties.

        Contract Addendum

        In such cases, the correct course of action is to sign an Addendum to the original contract, specifying which covenants are being waived and which covenants are being added. It is essential that the Addendum be negotiated and signed by persons with the power of representation of the parties and that it be drafted with the help of lawyers who specialize in this field. In addition to including correct clauses, it is necessary to verify that the covenants are valid according to the rules of law applicable to the contract.

        Here are some clauses that can be the subject of the Addendum, to be modulated according to the specific case and possible scenarios.

        Tariff Cost Sharing

        By introducing this covenant, it is provided that in the event that duties are confirmed at [x]% or are reduced or increased within certain established thresholds, the Parties will share the increase equally, or according to other established percentages.

        There may also be a ceiling on tariffs beyond which a party has the right to withdraw from the contract or request the suspension of certain orders for a specified period of time, after which it has the right to withdraw.

        Price Adjustment

        With this covenant, a discount or an increase in the product’s price is agreed upon, as the case may be, in the case of a duty greater than [x]%.

        Among the use cases, in addition to that of the company exporting to the U.S. or other intermediate markets, with final destination of the products in the U.S., is that of those who purchase a product subject to import duty and resell it, processed or assembled.

        Right to Cancel or Postpone Confirmed Orders

        This covenant gives the right to revoke or suspend for a certain period already negotiated orders, as such binding, in case of confirmation or introduction of duties above a certain threshold, for example, if 20% taxation was confirmed for the import of wine from the EU.

        The clause can be combined with previous covenants, for example, by stipulating that below the specified threshold, the contracts remain valid, and the parties share the duty or have the right to renegotiate the price.

        Supply Forecast Adjustment

        With this clause the Parties can modify supply programs already agreed for a specific duration (e.g., 24 months), with continuous sales and purchase obligations at a fixed price or indexable only within certain limits. The aim is to agree on the prerequisites for reshaping supply programs in the short and medium term, which can be very useful for defining the rules that will apply to relationships with key suppliers or customers for possible changes in volumes, delivery times, and prices.

        Right to Source from Alternative Suppliers

        This covenant serves to be authorized, if necessary, to source alternative suppliers of components or raw materials to those previously authorized in the contract with the end customer, for example, in cases where purchasing from the original suppliers has become too costly or difficult due to duties imposed at import or in previous steps in the supply chain, or other events such as currency or price fluctuation of certain commodities beyond a certain level established in the agreement.

        Hardship and Force Majeure

        The imposition of duties cannot be invoked as a cause of Force Majeure or hardship, respectively, to excuse contract non-performance or to renegotiate the price, even in cases of very high price increases (such as the 145% duty imposed on Chinese products). This conclusion is almost uniform under the law and jurisprudence of the major countries involved in the tariff war: U.S., China, Canada, Mexico, France and Italy: I refer to this practical guide for a timely examination of what the various rules provide.

        If the contract lacks a well drafter Force Majeure and Hardship clause, or contains a generic clause, it is important to get your hands on revising it to expressly state the cases in which a party is entitled to suspend or terminate the contract, how and when to communicate the decision to invoke the exemption, and the consequences on the parties‘ contractual obligations. You can go deeper on this topic here.

        Conclusion

        It is essential to prepare for possible future scenarios regarding duties (confirmed, increased, changed, or decreased) and to determine the consequences on trade relations with foreign clients and suppliers: moving today, at a standstill (or nearly so), allows entrepreneurs to negotiate shared and fair solutions and to avoid, as far as possible, the emergence of tensions and conflicts with the various partners along the international supply chain.

        Federico Vasoli

        Rechtsgebiete

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        • Auslandsinvestitionen
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          The importance of understanding the other side’s negotiating style

          13. Juli 2025

          • Italien
          • USA
          • Vertrieb
          • Steuer

          It is quite common for business relationships with agents or distributors to last for years without any signed documents. And be careful, because we know that a contract can exist even verbally.

          The absence of a written contract will add difficulties in the event of a possible claim, so what you do between the decision to terminate, and the moment of the claim is very important. Remember: ‘anything you write will be used against you’.

          The decision to terminate a business relationship is a very delicate moment to which, for some reason, solicitors are not invited. Here are some examples (all real) in which companies or employees with the best of intentions wrote to the agent/distributor. All of them were subsequently very damaging to the company:

          Saying ‘We are terminating our business relationship’ when the strategy will be to argue that no such business relationship exists, but rather that there are separate and linked contracts (e.g., supply rather than ongoing distribution contract; very significant compensation consequences).

          ‘You no longer represent our company’, which may be evidence that you did so before.

          ‘As of day X, you may no longer act on behalf of our company,’ which would prove that you were previously able to act on its behalf.

          ‘You may not attend the X trade fair on our behalf.’ A way of confirming that the agent/distributor’s responsibilities included participating in trade fairs and probably accrediting the customers obtained.

          ‘The sales you promoted have been significantly reduced in year N.’ When there is no written contract or other form of documentation, imputing a breach of an obligation that is not clear can be counterproductive.

          Saying ‘You are not actively promoting our products’ and then adding: ‘We urge you to stop promoting the sale of our products’.

          ‘You are no longer our exclusive representative’, which proves a type of relationship (representation/agent) and a tacit or express agreement (‘exclusivity’).

          ‘We have appointed another representative in your area’, which shows that the agent/distributor had an assigned area and was “representing”.

          ‘From this moment on, orders will be handled by X’, which also confirms a type of relationship.

           

          In summary: from the moment the company considers terminating a commercial relationship, especially when it is not in writing and before sending any letter, it is advisable to think carefully about the strategy in case of a possible claim. This is the best time to seek advice and avoid surprises. Any communication that is not in line with this strategy designed from the outset can only lead to confusion and problems.

          Remember the USA – EU agreement on 15% tariffs? I wrote that with a negotiator like Trump the game is never over (article here) and—after the recent interlude featuring a threat of 100% tariffs on pharmaceuticals—the U.S. government has announced the imposition of an overall 107% duty on Italian pasta, which could take effect on January 1, 2026.

          Where this new duty comes from

          The antidumping investigation was launched by the U.S. Department of Commerce at the request of certain competing American companies and is based on a 1996 antidumping order that allows for periodic reviews of imports of Italian pasta. The Department of Commerce conducts these checks annually to assess whether Italian producers are selling pasta at prices lower than the U.S. domestic market, a practice known as “dumping.”

          Companies involved in the investigation

          The Department of Commerce selected two sample companies for in-depth analysis, defined as “mandatory respondents”: La Molisana and Pastificio Lucio Garofalo. According to the official document published by the U.S. administration, for the period from July 1, 2023 to June 30, 2024, both companies allegedly sold their products below market prices, resulting in the imposition of a duty of 91.74%.

          U.S. authorities justified this percentage by claiming the two companies did not provide complete or compliant information as requested by the Department and were therefore insufficiently cooperative during the investigation. What is very important is that, in addition to the two companies directly examined, the additional 91.74% duty is also applied to numerous other Italian producers not individually reviewed. This methodology, while formally permitted under U.S. law as an exception, is being applied without any direct verification of the other companies.

          Next steps in the procedure

          Italy’s Ministry of Foreign Affairs moved immediately, formally intervening in the proceeding as an “interested party” through the Italian Embassy in Washington. The Foreign Ministry is working in close coordination with the companies concerned and, in concert with the European Commission, to persuade the U.S. Department to revise the provisional duties.

          The two companies involved (La Molisana and Garofalo) can submit documentation to contest the dumping allegations. However, if dumping is confirmed, the Department of Commerce will instruct Customs to apply antidumping duties on goods sold and entered into U.S. commerce.

          The preliminary nature of this determination means there is still room to change the decision before it becomes final.

          Possible effective date

          The new super-duty of 91.74%, which will be added to the existing 15% tariff for a total of 107%, is scheduled to take effect on January 1, 2026. This date therefore represents a crucial deadline for all ongoing diplomatic and legal actions.

          If confirmed, the economic impact would be significant: in 2024, Italian pasta exports to the United States reached a value of €671 million according to Coldiretti, accounting for nearly 17% of the sector’s total exports. A 107% duty would risk seriously undermining competitiveness in one of the most important markets for Italian agri-food products.

           What to do between now and January 1, 2026?

          At this stage, the entry into force of the new duty depends on the outcome of the ongoing procedure: given what has happened in recent months, and the political use the U.S. administration has made of tariffs—well beyond their technical function—it is reasonable to be pessimistic.

          So, what to do? In recent months we have seen companies react to the uncertainty over the fate of the tariffs in three ways:

          • Some rushed to ship as many products as possible before the potential effective date of the duty;
          • Some granted—upfront—discounts equivalent to the threatened duty, in case it came into force;
          • Some suspended orders, pending definitive news on the impact of the duties.

          These are all  valid options, but other effective tools for managing the uncertainty caused by the flurry of announcements, negotiations, and threats from the U.S. administration should not be forgotten: the risk of new duties being introduced, or existing ones being increased, can be managed in the contract by agreeing with the U.S. importer how any tariff change will affect the product.

          The parties can stipulate, for example, that the increase will be split equally; or that the importer will bear it beyond a certain threshold; or that if the duty exceeds a certain level, the contracts may be terminated. You can find a deeper dive in this article.

          The only certainty is that trade relations with the U.S. will stay unpredictable for a long time, and it’s vital to carefully manage the risk factors involved in selling products there. Right now, the focus is on tariffs and prices, and I encourage you to take this chance to thoroughly review existing agreements and assess whether—and how—other important points are addressed that could entail significant liabilities: we discuss them, very practically, in this book.

          On 29 June 2025, the Vietnamese government introduced Decree No. 163/2025/ND-CP (Decree 163). This decree provides detailed guidance on how the updated Law on Pharmacy will be implemented.

          Like the amended Law on Pharmacy, Decree 163 came into effect on 1 July 2025, replacing the previous Decree No. 54/2017/ND-CP (Decree 54). The new decree sets out comprehensive rules for key aspects of managing pharmaceuticals, including:

          • Pharmacy practice certificates
          • Certificates allowing pharmaceutical businesses to operate
          • Import and export of medicines and drug ingredients
          • Good Manufacturing Practice (GMP) inspections of overseas manufacturers
          • Recalling medicines and drug ingredients
          • Certificates for medicine advertising content
          • Medicine price management

          Key Changes in Decree 163

          Here are some important changes and additions introduced by Decree 163:

          Destroying Specially Controlled Medicines

          You no longer need to get approval from the relevant authority before destroying narcotic, psychotropic, and precursor drugs, or pharmaceutical ingredients that are narcotic or psychotropic substances or precursors used in medicines. Instead, you just need to provide notification at least seven working days in advance. This notification must include the planned destruction date and a detailed list of items to be destroyed.

          E-commerce in Pharmaceutical

          Pharmaceutical businesses that sell products online must openly display the following information to ensure transparency and consumer safety:

          • Their certificate allowing them to operate as a pharmaceutical business.
          • The pharmacy practice certificate of the person responsible for pharmaceutical expertise.
          • Information about the medicines themselves.

          Shelf-Life Rules for Imported Products

          For medicines and ingredients with a total shelf life of nine months or less, at least one-third of their shelf life must remain when they clear customs. Medicines with a shelf life of 30 days or less must still be within their shelf life at the time of customs clearance.

          Controlling Imported Products

          All medicines with marketing authorisation (MA) are subject to import control, except for:

          • Medicines needed for preventing and treating Group A infectious diseases that have been declared epidemics, as per the Law on Prevention and Control of Infectious Diseases.
          • Medicines with a shelf life of less than 30 days.

          Importers must inform the provincial People’s Committee at least five working days before making a customs declaration. The People’s Committee can then issue a written notice of non-compliance to the customs authority within five working days of receiving this notification.

          Medicine Advertising

          Decree 163 adds a process that allows an approved medicine advertising certificate to be adjusted for certain changes (such as a change to the MA holder or manufacturer information). This means you don’t have to go through the entire initial registration process for medicine advertising content again, as was required under the previous rules.

          Medicine Price Management

          Businesses must announce or re-announce wholesale prices, similar to the medicine price declaration process under Decree 54. Some medicines are exempt from this requirement, including those provided free of charge for emergency responses, national health programmes, humanitarian aid, clinical trials, scientific research, or exhibition purposes, and medicines carried as personal luggage.

          The Ministry of Health (MOH) can make recommendations if the announced or re-announced price is significantly higher than similar medicines already on the market. This includes situations where:

          • The announced or re-announced wholesale price of the medicine is higher than the highest price of similar medicines.
          • The price difference is more than 35% (for medicines priced under VND 1 million) or 15% (for medicines priced at VND 1 million and above) compared to winning bid prices in tenders.
          • The announced or re-announced price is higher than prices in the country of origin or other markets (if there’s no similar product in Vietnam).
          • When such differences are found, the MOH issues a formal recommendation to the announcing business and publishes it online for transparency and accountability.

          Further Guidance in New Circular

          On 1 July 2025, the MOH issued Circular No. 31/2025/TT-BYT (Circular 31), which further details how the amended Law on Pharmacy and Decree 163 should be implemented. Circular 31 officially replaces Circular No. 07/2018/TT-BYT and Decree 54 and came into effect immediately.

          Key provisions of Circular 31 include:

          Notification of Practising Pharmacists

          Pharmaceutical businesses that are not part of a pharmacy chain must inform the relevant authority of a list of people currently working at the business who hold pharmacy practice certificates. This notification must be submitted within 15 days of the date the certificate allowing the pharmaceutical business to operate was issued, or when there are any changes to the list. This is a shorter deadline than the previous 30 days under earlier rules.

          Pharmacy chains have similar notification duties and deadlines. Specifically, the chain operator must inform the provincial authority where each pharmacy in the chain is located about the list of practising pharmacists at those sites. Additionally, pharmacy chains must notify the authority if pharmacies are added or removed from the chain, and if there are any rotations of the people responsible for pharmaceutical expertise between pharmacies within the chain.

          Medicine Information Activities

          Under Circular 31, medicine information can still be given to healthcare professionals through information materials, seminars, and medical representatives.

          However, Circular 31 introduces a significant change by removing the need to obtain a certificate for medicine information content before carrying out these activities. Under the new rules, pharmaceutical businesses, representative offices of foreign pharmaceutical companies in Vietnam, and MA holders are now responsible for creating and distributing medicine information materials. These materials must comply with the package inserts for medicines approved by the MOH, the Vietnamese National Drug Formulary, and any related documents and professional instructions issued or recognised by the MOH.

          Donald Trump, never one to shy away from drama or diplomacy-via-caps-lock, has slapped a 50% tariff on all Brazilian exports to the United States. The justification? In his own delicate prose: „The treatment of former President Jair Bolsonaro is a disgrace… A witch hunt that must end IMMEDIATELY!“

          And just in case anyone thought this was about trade imbalances or economic strategy, Trump made things crystal clear: „Due to Brazil’s insidious attacks on free elections…“.

          In short, the 50% tariff isn’t about coffee, orange juice, or flip-flops. It’s about a Supreme Court judgment, applying Brazilian law, regarding Brazilian politicians accused of conspiring in a coup d’état. In other words, this is a brazen (and frankly absurd) attempt at judicial intervention via trade war.

          Trump, with his characteristic subtlety, offered a solution: manufacture in the U.S., and he’ll look kindly upon Brazil, like a mafia don offering „protection“ after smashing your shop window. But what he meant was: consider Bolsonaro innocent, and we’ll talk.

          The Brazilian market took the bait

          Although the fishy interference in Brazilian affairs was determined from a fish out of the water, the market took the bait: in the first 48 hours after the infamous letter, at least 1500 tons of fish were already held in Brazilian ports, as US buyers suspended their contracts due to uncertainty about the costs upon arrival. The fish market is on alert, as 80% of the exports head to the US, mainly coming from small family-owned industries that distribute the catch from artisanal fishing communities.

          The same effect hit other sectors, from orange, honey, and coffee to aircraft.

          Brazil’s response and sorcery: don’t mess with us (or our weather)

          Naturally, Brazil will not sit quietly sipping caipirinhas while its sovereignty is trampled. Reciprocity is on the table: if Washington raises tariffs, Brasília can do the same. But above all, one thing is sure: Brazil will never tolerate foreign interference in its independent judiciary.

          And then, a curious coincidence: right after Trump’s speech, a tornado accompanied by lightning struck the White House grounds. Pure chance? Maybe. Or could it have been the work of Brazilian indigenous shamans, a particularly well-organized group of umbanda practitioners, or simply the fact that, as every Brazilian child knows, God is Brazilian.

          Trump might want to check the weather forecast next time before penning another angry letter.

          The unpredictable becoming predictable

          Trade wars are rarely tidy affairs, but one thing they consistently deliver is chaos (in legal terms, disruption). And when disruption meets contracts, force majeure disputes often end up in court.

          At first glance, Trump’s decision to impose a 50% tariff overnight might feel like an unpredictable thunderbolt (quite literally, given the weather at the White House). But here’s the catch: by now, unpredictable tariffs are becoming predictable. When a government with a well-documented love for impulsive economic diplomacy imposes politically motivated tariffs, can anyone claim to be surprised?

          In most jurisdictions, force majeure requires that the event be extraordinary, unforeseeable, and beyond the parties’ control. A sudden 50% tariff certainly ticks a few of those boxes, but following a repetition of erratic trade policy, one might argue that businesses should expect what in past times was considered unexpected, especially when dealing with certain jurisdictions or political figures. In other words, Trump’s tariffs might not excuse performance if parties didn’t prepare for exactly this kind of volatility.

          This is where good contract drafting comes into play

          Savvy businesses are learning that their contracts must go beyond a vague boilerplate clause about “acts of government” or “changes in law.” Instead, they should expressly address the risk of sudden tariff changes, including

          • hardship clauses that allow renegotiation when costs become commercially unreasonable;
          • price adjustment mechanisms linked to tariff thresholds;
          • termination rights triggered by specified levels of customs duties;
          • currency fluctuation provisions (because tariffs rarely travel alone, and currency swings often accompany them).

          In short, while no contract can immunize a business from every shock, smart drafting can mean the difference between a commercial headache and a catastrophic breach.

          Therefore, tariffs may no longer be an unpredictable storm; they are part of the new predictable landscape. Given that your contract might wake up tomorrow facing ‘IMMEDIATE’ punitive tariffs in all caps, your contract should be ready today.

          The unwitting cupid: strengthening EU-Brazil relations

          While the tariffs may ruffle trade flows between Brasília and Washington, there’s an unintended silver lining: Trump is proving to be the most efficient matchmaker between Brazil and other markets, such as China and the European Union.

          The EU-Brazil relationship, already a flirtation with promising prospects, with relevant progress in the EU-Mercosur Agreement, now seems destined for deeper romance. If Mr. Trump insists on isolating the US from Brazil, the old continent stands ready, with flowers and wine in hand, to pick up where the US left off. After all, Brazilian fish can pair up nicely with champagne, cava and prosecco.

          So thank you, Mr. Trump. In your quest to bully Brazil into submission, you may have done more to strengthen transatlantic ties than any EU Commissioner ever could. As they say in Brasília these days: Trump is not a trade warrior. He’s a cupid in disguise.

          The recent announcement of a landmark trade agreement framework, following just three months negotiations since President Trump’s tariffs announcement on 2 April 2025, signals a pivotal shift, not merely in bilateral relations, but in the broader architecture of global supply chains.

          As a commercial lawyer with exposure to Vietnam since 2007, I have observed the evolving dynamics between the United States and Vietnam through the years, talking to students, entrepreneurs, veterans, diplomats, humans from all walks all life, from both nations and beyond.

          You may recall that Vietnam, with the notable exclusion of China, was to be the nation that would encounter the most stringent tariffs imposed by the Trump administration, reaching an astonishing 46%.

          The newly forged framework outlines significant reciprocal concessions designed to foster greater trade and investment flows. Granted, pre-April 2 tariffs applied by the USA on Vietnamese goods were lower than what emerges from the framework agreement, but still, it is better than 46%),

          The United States has committed to imposing a 20% tariff on most Vietnamese imports, a notable reduction from the previously mooted 46%. However, a substantial 40% tariff will apply to goods re-exported from third countries, with a particular focus on those originating from China.

          Vietnam has pledged to open its market to a wide array of US products. Crucially, it has also committed to implementing stringent measures aimed at restricting the transshipment of Chinese goods through its territory, a long-standing concern for Washington.

          In a significant win for American exporters, US goods will now enjoy duty-free access to the Vietnamese market, effectively granting “total access”, particularly for large-engine vehicles such as SUVs, as emphatically stated by President Trump (how SUVs are going to circulate in the narrow alleys of Hanoi and Ho Chi Minh City, infested by swarms of mopeds, is a different story).

          This agreement is expected to catalyse growth in several key sectors. Electronics, textiles, furniture, energy (especially Liquefied Natural Gas), and agriculture are poised for expansion. US firms specialising in manufacturing technology, energy solutions, and agricultural products are anticipated to be the primary beneficiaries. Furthermore, beyond immediate trade benefits, the agreement is set to reshape investment strategies, encouraging a greater localisation of supply chains within Vietnam. This strategic realignment is also expected to further solidify the already robust US-Vietnam Comprehensive Strategic Partnership.

          While the potential upsides are considerable, it is imperative for businesses and investors to approach this new landscape with a clear understanding of the accompanying risks. From my vantage point, I identify several significant execution challenges and structural impediments that require close monitoring.

          Enforcement of Transshipment Controls

          The most immediate and perhaps formidable risk lies in the effective enforcement of transshipment controls. Vietnam has historically served as a significant assembly point for Chinese-manufactured components. Ensuring that goods originating from China are not merely re-routed through Vietnam to circumvent US tariffs will require exceptionally close monitoring and robust verification mechanisms. The legal and practical complexities of definitively determining the true country of origin for all goods will undoubtedly pose a persistent challenge. As a European citizen, witnessing how the EU-Vietnam Free Trade Agreement (“EVFTA”), which poses an important stress on certificates of origin, I am particularly aware of this matter.

          While Vietnam has made remarkable strides in its economic development, certain structural issues could hinder its capacity to scale up high-value manufacturing in the short to medium term. These include:

          Legal framework nuances

          Vietnam’s legal framework for foreign investment has seen continuous improvements, but legal and cultural complexities and inconsistencies can and do still arise. Navigating the regulatory landscape, particularly with new rules stemming from this agreement and at a time of deep administrative, governmental, digital and legal reforms in Vietnam, will demand expert legal guidance to ensure compliance and mitigate potential fines and disputes. Issues surrounding so-called sublicences for businesses, intellectual property rights enforcement and contract enforceability, whilst improving, still require careful consideration;

          Education

          The ambition to transform Vietnam into a high-value manufacturing hub necessitates a workforce equipped with advanced skills. While the Vietnamese government prioritises education and workforce development, a significant portion of the current labour force lacks formal training and specialised certifications, let alone a good command of the English language. Bridging this skills gap, particularly in areas like advanced manufacturing, engineering, and digital technologies is a necessity and not just in light of this framework agreement. Companies may need to factor in substantial investment in training and upskilling programmes for their Vietnamese employees.

          Infrastructures

          Despite considerable investment, Vietnam’s infrastructure, particularly in logistics, energy, and transportation, continues to face bottlenecks. And China – the apparent target of Trump’s tariffs – is stepping in with high-speed trains connecting it to the northern Provinces of Vietnam. An increased volume of high-value manufacturing and trade will place further strain on existing infrastructure. Inadequate port capacity, congested roads, and a reliable energy supply (including for EV charging) are critical concerns that could impact efficiency and increase operational costs for businesses.

          Policy divergence

          This framework agreement deepens US-Vietnam trade ties and seems to be paving the way for more US investments in Vietnam, but this second aspect seems to run counter to parallel US policy objectives aimed at reshoring manufacturing back to the United States. This potential divergence in strategic priorities could introduce yet another element of unpredictability in the long term, necessitating a flexible and adaptable investment approach. Future shifts in US policy could impact the durability and full extent of the benefits derived from this agreement.

          This trade agreement, if finalised and implemented, undoubtedly represents a structural shift in global trade dynamics. It strategically positions Vietnam as an increasingly important high-value manufacturing hub and significantly deepens US engagement in Southeast Asia. We will need time, however, to assess the practical impact of the agreement, observing the efficacy of its implementation, and understanding how Vietnam’s inherent strengths and challenges will ultimately shape its role in the reconfigured global supply chain.

          We will also need to see what China, if anything, will do as a countermeasure. In fact, any assessment of Vietnam’s evolving trade landscape would be incomplete without a thorough consideration of China’s influence and strategic posture. President Xi Jinping has consistently championed a vision of a “community of shared future for mankind,” a concept that, while outwardly promoting global cooperation, also subtly underscores a demand for international alignment with Beijing’s interests. In the context of escalating trade tensions, Xi has repeatedly warned that “trade wars have no winners,” advocating for unity against protectionist measures, yet simultaneously implying that nations must ultimately choose sides, either with or against China’s economic and political orbit. Vietnam, despite its historical complexities and occasional maritime disputes with Beijing in the South China Sea (or East Sea, as it is officially called by Hanoi), remains deeply interwoven with China’s economy. China has been Vietnam’s largest trading partner for many years, with significant inflows of Chinese FDI, loans, and project contractors. This economic dependency is particularly evident in various sectors, where Chinese components and materials form a substantial part of Vietnamese manufacturing supply chains. While Vietnam has actively sought to diversify its trade partners and reduce its reliance on China, the sheer scale of the bilateral economic relationship means that disentanglement is a long-term, complex endeavour. Furthermore, China’s influence extends beyond direct trade into crucial regional resources. The Mekong River, a lifeline for millions in Southeast Asia, originates in China, which has constructed numerous upstream dams.

          As Vietnam navigates its enhanced trade relationship with the United States, it must simultaneously contend with the enduring economic gravity and strategic ambitions of its northern giant neighbour. Any perceived move by Vietnam to significantly shift away from China could invite retaliatory measures or heightened pressure from Beijing. Businesses investing in Vietnam must not only grasp the intricacies of the US-Vietnam agreement but also meticulously analyse how these developments will intersect with, and potentially be impacted by, the intricate, often delicate, and sometimes fraught relationship between Hanoi and Beijing. Understanding this geopolitical tightrope will be essential for sustainable success in the Vietnamese market. Prudence, informed legal counsel, and a keen eye on evolving geopolitical and economic realities will be paramount for those seeking to capitalise on this transformative new chapter.

          Takeaways

          • Tariffs:The US-Vietnam framework agreement marks a significant departure from previous trade dynamics, reducing US tariffs on most Vietnamese imports to 20% (from a mooted 46%) while imposing a 40% tariff on transshipped goods, especially from China.
          • Vietnam’s market opening:Vietnam has committed to duty-free access for a broad range of US products and stricter controls on Chinese goods transiting its territory.
          • Growth / manufacturing shift potential:The agreement is expected to fuel expansion in Vietnamese electronics, textiles, furniture, energy (LNG), and agriculture. It also encourages supply chain localisation within Vietnam (normally more of an assembly point for Chinese products).
          • Execution challenges: Effectively preventing the re-routing of Chinese goods through Vietnam to avoid tariffs will be a complex and demanding task; Despite economic progress, Vietnam faces hurdles in scaling high-value manufacturing due to legal framework nuances (e.g., sublicences, IP enforcement), a skills gap in its workforce (lack of formal training, English proficiency) and infrastructure bottlenecks (logistics, energy, transportation).
          • US policy divergence:The agreement’s encouragement of US investment in Vietnam appears to contradict the broader US policy objective of reshoring manufacturing.
          • China:Businesses must consider China’s significant economic sway over Vietnam, including its position as Vietnam’s largest trading partner, its FDI, and its control over shared resources like the Mekong River. Any major shift by Vietnam away from China could lead to retaliatory measures from Beijing.
          • Uncertainty:This is not a final agreement, so the situation might change. Prudence and informed legal counsel are crucial for businesses navigating this evolving landscape.

          The Trump approach: power and dominance

          In his autobiography, The Art of the Deal, Donald Trump describes negotiation as a contest of strength, determination, and dominance. His vision is clear: anyone who shows uncertainty or makes concessions too early is immediately perceived as a loser. His negotiating style is based on constant pressure, maximalist demands, and calculated threats, to obtain unilateral advantages. In this scheme, compromise is not a point of arrival, but a sign of weakness to be avoided.

          Trump has always been a competitive negotiator, focused on immediate results and uninterested in balanced solutions unless they are strictly functional to his interests.

          Other negotiating styles: compromising and collaborative

          In contrast to this competitive approach, there are two other relevant negotiating styles:

          • The compromising style aims to reach a ‘middle ground’ agreement, in which both parties give something up to achieve an acceptable solution. It is a pragmatic approach, practical in situations where time is limited or positions are too far apart for genuine collaboration.
          • The collaborative style, on the other hand, aims to create win-win solutions. The parties seek to thoroughly understand each other’s interests and work together to build an outcome that maximizes the benefit for both. It requires openness, time, and trust.

          In commercial negotiations, the compromising or collaborative approach can only work if the other party shares the same logic. But when dealing with an explicitly competitive actor such as Trump, adopting a compromising style risks seriously penalizing the other party, for at least three reasons:

          • It conveys weakness

          An accommodating gesture is seen not as a sign of openness, but as a point of pressure to be exploited. The competitive negotiator, focused on gaining an immediate advantage, interprets it as a willingness to give even more.

          • It relinquishes bargaining power

          The EU has a vast market and significant trade levers, especially in a context where the US is closing the door to the Chinese market. Offering concessions at the outset is tantamount to burning your cards without getting anything in return. In a competitive confrontation, the first move can set the tone for the negotiation: once a concession has been made, it is very difficult to backtrack.

          • It legitimizes the negotiating imbalance

          An unbalanced compromise, if accepted without resistance, risks becoming the new basis for future trade relations, systematically penalizing the EU in subsequent rounds.

          Why 30%? The anchor technique

          Trump often uses a negotiating technique known as the anchor technique. This consists of deliberately setting a very high target at the beginning of the negotiation (in our case, the threat of 30% tariffs).

          The aim is to create a psychological perimeter for the negotiation and force the other party to reason on the basis of that figure, even though they are aware that it is arbitrary. This technique allows one to influence the scope of the discussion and obtain greater concessions, just as Trump has done.

          The worst response: unilateral concessions with no return

          Unfortunately, the European Union has already shown worrying signs of a compromising attitude that has not been negotiated with the Trump administration, for example:

          • The waiver of the web tax* on American digital giants, without obtaining any regulation or shared tax contribution in return.
          • The offer to increase imports of liquefied natural gas (LNG) from the US, made to reassure Washington, without obtaining anything in return.
          • The acceptance of the increase in NATO spending to 5% of GDP, demanded by Trump, again without obtaining anything in return.

          All these offers without asking for anything in return reinforce the idea that the EU is willing to concede from the outset. Trump, true to his competitive logic, sees these concessions as a starting point, not a compromise: this pushes him to raise his demands, not moderate them.

          Persevering would be a fatal mistake

          Continuing along this path of compromise, in the hope that accommodation will ease the pressure, would be not only ineffective but counterproductive. With a competitive negotiator, unilateral concessions do not stop escalation: they fuel it. Any sign of weakness is interpreted as additional room for maneuver.

          A helpful example is China’s reaction during the trade war initiated by Trump. Faced with massive tariffs imposed by the US, Beijing responded in kind, imposing equivalent tariffs. Instead of giving in, it spoke the same language of power. The result is there for all to see: after weeks of escalation, the US had to moderate its position, opening up to a more balanced agreement.

          The right strategy: speak his language

          To avoid the mistakes of the past, the EU should therefore reverse its negotiating logic. Not to fuel confrontation, but to restore a credible balance. Some applicable countermeasures could be:

          • Target Trump’s electoral base, particularly the agricultural sectors (soy, corn, beef), with selective tariffs or targeted restrictions.
          • Put the European web tax* back on the table, even with a minimum rate, linking any exemptions to real concessions from the US.

          These well-calibrated moves would strengthen the EU’s position and show that it can defend its interests by speaking a language Trump understands: that of strength and bargaining power.

          Going beyond requests, seeking the other party’s interests

          A fundamental principle in any negotiation is to identify the other side’s interests and find a way to allow them to achieve them without sacrificing your own. This is no easy task, given Trump’s notorious volatility and the lack of sound arguments to justify the demands made in the negotiations.

          In the case of the EU-US negotiations, it must be borne in mind that Trump is playing the game with his electoral base in mind: an agreement must offer him a narrative of victory to communicate to his electorate.

          Takeaway

          When negotiating with a competitive player like Trump, one should abandon the accommodating approach, avoid concessions without something in return, and adopt a style that is more assertive, strategic, and symmetrical.

          Only then will it be able to build an agreement that is solid, fair, and respectful of its economic and political strength.

          I have often dealt with commercial distribution agreements between Italian and Chinese companies, sometimes following negotiations in the wine sector for various types of agreements: sales, distribution, franchising, establishment of joint ventures, and sales through online stores.

          I am sharing some key considerations for approaching this complex but opportunity-rich market.

          📌 Here are my 10 takeaways

          Step Zero. Protect your IP

          it is essential to protect your intellectual property before entering China. This includes trademarks (including their Chinese transliteration), labels, web domains, and social media accounts. Neglecting this aspect can have disastrous consequences, exposing you to the widespread phenomenon of trademark squatting (even famous names such as Michael Jordan, Elon Musk, and Donald Trump have fallen victim to this).

          For more information, you can read this article about Intellectual property protection in China

          1 – Know your enemy

          trust is good, but mistrust is better. Before entering into commercial agreements, it is essential to check the credentials of potential partners through the databases of the State Administration for Industry and Commerce. When it comes to wine, it is necessary to check whether the prospective distributor has a license to import and distribute wine.

          2 – No copy-paste

           Contracts must be tailor-made, adapting them to local specificities. In particular, it is crucial to clearly regulate promotional activities: budget, commercial actions, communication methods, and management of the producer’s trademarks. It is also best to write the contract in Chinese to ensure that there are no misunderstandings and in case it needs to be used before a judge or local administrative body, as Chinese is the only official language. (N.B.: if you think of entrusting the task to ChatGPT, this is not a good idea).

          For an in-depth article, check out The commercial distribution contract in China

          3 – Decide immediately how and where to litigate

          It may seem counterintuitive, but it is best to avoid providing for Italian (or French, or German) jurisdiction and applicable law, which is an ineffective solution, especially in cases where urgent action is needed to stop unfair competition or counterfeiting. Consider applying Chinese law and provide for an arbitration clause at CIETAC. An effective dispute management strategy is a key element of the agreement and must be negotiated carefully. (P.S.: This applies not only to China but to all international agreements. For more information, see this article).

          4 – China is big

          And it is the sum of many very different internal markets. Exclusivity should be granted for good reasons, but only if the distributor has a well-developed commercial network and can achieve specific shared objectives. If granted, it should be limited to the province where the distributor is based and subject to the achievement of agreed sales volumes. Having a single distributor for the whole of China is like entrusting an Italian distributor with promoting a product throughout Europe. Or appoint a NYC-based company to promote and sell your wines in all 50 US States.

          5 – China is far away

          Delegating everything to the local distributor and taking no interest in what is happening on the Chinese market is never a good idea. Firstly, because you have no idea how, where, and with what results the wines are being sold. Secondly, because you cannot verify compliance with agreements, for example on non-competition or the use of trademarks. It is therefore important to schedule meetings to share commercial policies and be able to verify what is happening, including through audits and visits to warehouses and the sales network.

          6 – China is expensive

          Competition in the Chinese domestic market is fierce. This is also true in terms of price, as some countries that are direct competitors of Italy (Australia, Chile, New Zealand) have free trade agreements and can therefore enter the market on more favorable terms than Italian wine, which is subject to a total tax burden of around 43% after payment of duties, excise taxes, and VAT. It is necessary to position oneself in the right market segment (medium-high), and to do so, it is necessary to plan the right commercial actions together with the distributor. Selling Ex-Works and hoping that the distributor will take care of everything is not an excellent strategy for being competitive.

          7 – China is dangerous

          Scams are always around the corner. In the wine world in particular, for example, spontaneous expressions of interest are frequent, arriving via the company website, social media accounts, or directly via email. They sound like this: we have discovered your wines, we think they are fantastic, we want to place an order immediately. If it sounds too good and easy, it is certainly a scam. There is an easy way to check: if the next step is a request for payment of a few thousand euros, justified by the need to register the wines on the CIFER (China Imported Food Enterprise Registration) portal, or to register your trademark to prevent others from doing so, or to authenticate the signature on the sales contract… these are attempts at fraud, and the elusive order will never arrive after payment has been received. How can you check whether the person you are dealing with is a reputable company or a fraudster? 👉🏼Go back to point 1 (here is an in-depth article).

          8 – E-commerce? Yes, but with method (and money)

          Online wine sales continue to grow, but entering large platforms is complex, competition is fierce, and running an online store requires meticulous planning and highly efficient system implementation. The online market in China is all pay-for-play. Nothing is achieved with no money or minimal effort. If you want to sell online, you need to build an omnichannel system integrated with traditional distribution, and to do this, it is essential to involve a local partner with well-defined investments and responsibilities.

          9 – China is not a market for everyone

          You need to protect your brands, study the market thoroughly, know your competition (both foreign and local), find the right market channel, select a distributor motivated to invest time and money in promoting your product, and be willing to support them with the right investments. If you want to build a serious plan to enter the Chinese market, you must have a medium- to long-term perspective. There are no shortcuts (actually, there are many, but they almost always lead to wasted time and money). If you are unwilling to invest in entering the Chinese market through the front door, it is unlikely that anyone else will do it for you.

          10 – Don’t do it yourself

          If you have read up to point 9 and are still keen to enter the Chinese market, consider doing so professionally, involving consultants who can support your company throughout the market research, scouting, negotiation, and contract drafting processes. This is also part of the investment needed to build and develop a solid and resilient business model. This advice applies to all foreign markets, and even more so to China.

          The most dangerous mistake one can make after the announcement of the (partial) suspension of U.S. duties for 90 days is to hope that everything will go well and we will return to the pre-April 2 world.

          First, because very invasive tariffs remain in place: 10 percent on all countries that trade with the U.S., including the EU, 25 percent on automotive, 25 percent on steel and aluminum, 145 percent on China.

          Second, because it is impossible to predict the actions of the U.S. Administration in the short and medium term: it cannot be ruled out that tariffs will remain, increase, change targets or that other factors will intervene to turn the tide in international markets, such as an escalation of the trade war with China.

          The 90-day suspension is an opportunity

          The U.S.’s temporary suspension of tariffs represents a valuable window that should be used not only as a truce but also as a valuable room for action: 90 days to rehash contracts, renegotiate key clauses, and insert levers of flexibility that can protect business in various future scenarios in the U.S. and other markets.

          Today’s exporters cannot afford to „sit back and see what will happen“-it is time to act, and to do so professionally and strategically. Let’s look at a checklist of important points to consider.

          What do contracts with customers and suppliers entail?

          The first point is to survey agreements with the trade network in the U.S. and other countries that export to the U.S., as well as with upstream suppliers in the supply chain.

          Is there a written contract? The worst-case scenario – unfortunately a very frequent one – is when the parties cooperate informally, only based on orders and order confirmations. This leaves undefined not only what happens in the case of imposition of duties, but also a whole range of other points, for example, limits on damages that can be claimed in the case of breach of contract, the duration of the agreement, the applicable law, and how any disputes will be resolved.

          Another very problematic scenario is one in which contracts exist, but they are generic and do not include the necessary covenants to manage the risks involved in operating in a highly litigious market such as the U.S., which, moreover, has very high legal costs.

          Having done this analysis, the necessary actions can be put in place, prioritizing according to the importance of business relationships and as appropriate:

          • Negotiate and conclude a written contract from scratch
          • Replace the existing agreement with a complete and correct contract
          • Amend and integrate the existing agreement with pacts to manage tariffs and other causes of price fluctuations

          Let us dwell on the last scenario, assuming that there is a complete and correct contract but one that does not regulate price and cost fluctuation as a direct or indirect consequence of the introduction of duties.

          Contract Addendum

          In such cases, the correct course of action is to sign an Addendum to the original contract, specifying which covenants are being waived and which covenants are being added. It is essential that the Addendum be negotiated and signed by persons with the power of representation of the parties and that it be drafted with the help of lawyers who specialize in this field. In addition to including correct clauses, it is necessary to verify that the covenants are valid according to the rules of law applicable to the contract.

          Here are some clauses that can be the subject of the Addendum, to be modulated according to the specific case and possible scenarios.

          Tariff Cost Sharing

          By introducing this covenant, it is provided that in the event that duties are confirmed at [x]% or are reduced or increased within certain established thresholds, the Parties will share the increase equally, or according to other established percentages.

          There may also be a ceiling on tariffs beyond which a party has the right to withdraw from the contract or request the suspension of certain orders for a specified period of time, after which it has the right to withdraw.

          Price Adjustment

          With this covenant, a discount or an increase in the product’s price is agreed upon, as the case may be, in the case of a duty greater than [x]%.

          Among the use cases, in addition to that of the company exporting to the U.S. or other intermediate markets, with final destination of the products in the U.S., is that of those who purchase a product subject to import duty and resell it, processed or assembled.

          Right to Cancel or Postpone Confirmed Orders

          This covenant gives the right to revoke or suspend for a certain period already negotiated orders, as such binding, in case of confirmation or introduction of duties above a certain threshold, for example, if 20% taxation was confirmed for the import of wine from the EU.

          The clause can be combined with previous covenants, for example, by stipulating that below the specified threshold, the contracts remain valid, and the parties share the duty or have the right to renegotiate the price.

          Supply Forecast Adjustment

          With this clause the Parties can modify supply programs already agreed for a specific duration (e.g., 24 months), with continuous sales and purchase obligations at a fixed price or indexable only within certain limits. The aim is to agree on the prerequisites for reshaping supply programs in the short and medium term, which can be very useful for defining the rules that will apply to relationships with key suppliers or customers for possible changes in volumes, delivery times, and prices.

          Right to Source from Alternative Suppliers

          This covenant serves to be authorized, if necessary, to source alternative suppliers of components or raw materials to those previously authorized in the contract with the end customer, for example, in cases where purchasing from the original suppliers has become too costly or difficult due to duties imposed at import or in previous steps in the supply chain, or other events such as currency or price fluctuation of certain commodities beyond a certain level established in the agreement.

          Hardship and Force Majeure

          The imposition of duties cannot be invoked as a cause of Force Majeure or hardship, respectively, to excuse contract non-performance or to renegotiate the price, even in cases of very high price increases (such as the 145% duty imposed on Chinese products). This conclusion is almost uniform under the law and jurisprudence of the major countries involved in the tariff war: U.S., China, Canada, Mexico, France and Italy: I refer to this practical guide for a timely examination of what the various rules provide.

          If the contract lacks a well drafter Force Majeure and Hardship clause, or contains a generic clause, it is important to get your hands on revising it to expressly state the cases in which a party is entitled to suspend or terminate the contract, how and when to communicate the decision to invoke the exemption, and the consequences on the parties‘ contractual obligations. You can go deeper on this topic here.

          Conclusion

          It is essential to prepare for possible future scenarios regarding duties (confirmed, increased, changed, or decreased) and to determine the consequences on trade relations with foreign clients and suppliers: moving today, at a standstill (or nearly so), allows entrepreneurs to negotiate shared and fair solutions and to avoid, as far as possible, the emergence of tensions and conflicts with the various partners along the international supply chain.

          Roberto Luzi Crivellini

          Rechtsgebiete

          • Schiedsgerichtsbarkeit
          • Vertrieb
          • Internationaler Handel
          • Rechtsstreitigkeiten
          • Immobilien
          Kontakt Roberto

          Schreiben Sie an Roberto





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            Contracts for Wine Distribution in China. 10 takeaways

            4. Juni 2025

            • China
            • Vertrieb

            It is quite common for business relationships with agents or distributors to last for years without any signed documents. And be careful, because we know that a contract can exist even verbally.

            The absence of a written contract will add difficulties in the event of a possible claim, so what you do between the decision to terminate, and the moment of the claim is very important. Remember: ‘anything you write will be used against you’.

            The decision to terminate a business relationship is a very delicate moment to which, for some reason, solicitors are not invited. Here are some examples (all real) in which companies or employees with the best of intentions wrote to the agent/distributor. All of them were subsequently very damaging to the company:

            Saying ‘We are terminating our business relationship’ when the strategy will be to argue that no such business relationship exists, but rather that there are separate and linked contracts (e.g., supply rather than ongoing distribution contract; very significant compensation consequences).

            ‘You no longer represent our company’, which may be evidence that you did so before.

            ‘As of day X, you may no longer act on behalf of our company,’ which would prove that you were previously able to act on its behalf.

            ‘You may not attend the X trade fair on our behalf.’ A way of confirming that the agent/distributor’s responsibilities included participating in trade fairs and probably accrediting the customers obtained.

            ‘The sales you promoted have been significantly reduced in year N.’ When there is no written contract or other form of documentation, imputing a breach of an obligation that is not clear can be counterproductive.

            Saying ‘You are not actively promoting our products’ and then adding: ‘We urge you to stop promoting the sale of our products’.

            ‘You are no longer our exclusive representative’, which proves a type of relationship (representation/agent) and a tacit or express agreement (‘exclusivity’).

            ‘We have appointed another representative in your area’, which shows that the agent/distributor had an assigned area and was “representing”.

            ‘From this moment on, orders will be handled by X’, which also confirms a type of relationship.

             

            In summary: from the moment the company considers terminating a commercial relationship, especially when it is not in writing and before sending any letter, it is advisable to think carefully about the strategy in case of a possible claim. This is the best time to seek advice and avoid surprises. Any communication that is not in line with this strategy designed from the outset can only lead to confusion and problems.

            Remember the USA – EU agreement on 15% tariffs? I wrote that with a negotiator like Trump the game is never over (article here) and—after the recent interlude featuring a threat of 100% tariffs on pharmaceuticals—the U.S. government has announced the imposition of an overall 107% duty on Italian pasta, which could take effect on January 1, 2026.

            Where this new duty comes from

            The antidumping investigation was launched by the U.S. Department of Commerce at the request of certain competing American companies and is based on a 1996 antidumping order that allows for periodic reviews of imports of Italian pasta. The Department of Commerce conducts these checks annually to assess whether Italian producers are selling pasta at prices lower than the U.S. domestic market, a practice known as “dumping.”

            Companies involved in the investigation

            The Department of Commerce selected two sample companies for in-depth analysis, defined as “mandatory respondents”: La Molisana and Pastificio Lucio Garofalo. According to the official document published by the U.S. administration, for the period from July 1, 2023 to June 30, 2024, both companies allegedly sold their products below market prices, resulting in the imposition of a duty of 91.74%.

            U.S. authorities justified this percentage by claiming the two companies did not provide complete or compliant information as requested by the Department and were therefore insufficiently cooperative during the investigation. What is very important is that, in addition to the two companies directly examined, the additional 91.74% duty is also applied to numerous other Italian producers not individually reviewed. This methodology, while formally permitted under U.S. law as an exception, is being applied without any direct verification of the other companies.

            Next steps in the procedure

            Italy’s Ministry of Foreign Affairs moved immediately, formally intervening in the proceeding as an “interested party” through the Italian Embassy in Washington. The Foreign Ministry is working in close coordination with the companies concerned and, in concert with the European Commission, to persuade the U.S. Department to revise the provisional duties.

            The two companies involved (La Molisana and Garofalo) can submit documentation to contest the dumping allegations. However, if dumping is confirmed, the Department of Commerce will instruct Customs to apply antidumping duties on goods sold and entered into U.S. commerce.

            The preliminary nature of this determination means there is still room to change the decision before it becomes final.

            Possible effective date

            The new super-duty of 91.74%, which will be added to the existing 15% tariff for a total of 107%, is scheduled to take effect on January 1, 2026. This date therefore represents a crucial deadline for all ongoing diplomatic and legal actions.

            If confirmed, the economic impact would be significant: in 2024, Italian pasta exports to the United States reached a value of €671 million according to Coldiretti, accounting for nearly 17% of the sector’s total exports. A 107% duty would risk seriously undermining competitiveness in one of the most important markets for Italian agri-food products.

             What to do between now and January 1, 2026?

            At this stage, the entry into force of the new duty depends on the outcome of the ongoing procedure: given what has happened in recent months, and the political use the U.S. administration has made of tariffs—well beyond their technical function—it is reasonable to be pessimistic.

            So, what to do? In recent months we have seen companies react to the uncertainty over the fate of the tariffs in three ways:

            • Some rushed to ship as many products as possible before the potential effective date of the duty;
            • Some granted—upfront—discounts equivalent to the threatened duty, in case it came into force;
            • Some suspended orders, pending definitive news on the impact of the duties.

            These are all  valid options, but other effective tools for managing the uncertainty caused by the flurry of announcements, negotiations, and threats from the U.S. administration should not be forgotten: the risk of new duties being introduced, or existing ones being increased, can be managed in the contract by agreeing with the U.S. importer how any tariff change will affect the product.

            The parties can stipulate, for example, that the increase will be split equally; or that the importer will bear it beyond a certain threshold; or that if the duty exceeds a certain level, the contracts may be terminated. You can find a deeper dive in this article.

            The only certainty is that trade relations with the U.S. will stay unpredictable for a long time, and it’s vital to carefully manage the risk factors involved in selling products there. Right now, the focus is on tariffs and prices, and I encourage you to take this chance to thoroughly review existing agreements and assess whether—and how—other important points are addressed that could entail significant liabilities: we discuss them, very practically, in this book.

            On 29 June 2025, the Vietnamese government introduced Decree No. 163/2025/ND-CP (Decree 163). This decree provides detailed guidance on how the updated Law on Pharmacy will be implemented.

            Like the amended Law on Pharmacy, Decree 163 came into effect on 1 July 2025, replacing the previous Decree No. 54/2017/ND-CP (Decree 54). The new decree sets out comprehensive rules for key aspects of managing pharmaceuticals, including:

            • Pharmacy practice certificates
            • Certificates allowing pharmaceutical businesses to operate
            • Import and export of medicines and drug ingredients
            • Good Manufacturing Practice (GMP) inspections of overseas manufacturers
            • Recalling medicines and drug ingredients
            • Certificates for medicine advertising content
            • Medicine price management

            Key Changes in Decree 163

            Here are some important changes and additions introduced by Decree 163:

            Destroying Specially Controlled Medicines

            You no longer need to get approval from the relevant authority before destroying narcotic, psychotropic, and precursor drugs, or pharmaceutical ingredients that are narcotic or psychotropic substances or precursors used in medicines. Instead, you just need to provide notification at least seven working days in advance. This notification must include the planned destruction date and a detailed list of items to be destroyed.

            E-commerce in Pharmaceutical

            Pharmaceutical businesses that sell products online must openly display the following information to ensure transparency and consumer safety:

            • Their certificate allowing them to operate as a pharmaceutical business.
            • The pharmacy practice certificate of the person responsible for pharmaceutical expertise.
            • Information about the medicines themselves.

            Shelf-Life Rules for Imported Products

            For medicines and ingredients with a total shelf life of nine months or less, at least one-third of their shelf life must remain when they clear customs. Medicines with a shelf life of 30 days or less must still be within their shelf life at the time of customs clearance.

            Controlling Imported Products

            All medicines with marketing authorisation (MA) are subject to import control, except for:

            • Medicines needed for preventing and treating Group A infectious diseases that have been declared epidemics, as per the Law on Prevention and Control of Infectious Diseases.
            • Medicines with a shelf life of less than 30 days.

            Importers must inform the provincial People’s Committee at least five working days before making a customs declaration. The People’s Committee can then issue a written notice of non-compliance to the customs authority within five working days of receiving this notification.

            Medicine Advertising

            Decree 163 adds a process that allows an approved medicine advertising certificate to be adjusted for certain changes (such as a change to the MA holder or manufacturer information). This means you don’t have to go through the entire initial registration process for medicine advertising content again, as was required under the previous rules.

            Medicine Price Management

            Businesses must announce or re-announce wholesale prices, similar to the medicine price declaration process under Decree 54. Some medicines are exempt from this requirement, including those provided free of charge for emergency responses, national health programmes, humanitarian aid, clinical trials, scientific research, or exhibition purposes, and medicines carried as personal luggage.

            The Ministry of Health (MOH) can make recommendations if the announced or re-announced price is significantly higher than similar medicines already on the market. This includes situations where:

            • The announced or re-announced wholesale price of the medicine is higher than the highest price of similar medicines.
            • The price difference is more than 35% (for medicines priced under VND 1 million) or 15% (for medicines priced at VND 1 million and above) compared to winning bid prices in tenders.
            • The announced or re-announced price is higher than prices in the country of origin or other markets (if there’s no similar product in Vietnam).
            • When such differences are found, the MOH issues a formal recommendation to the announcing business and publishes it online for transparency and accountability.

            Further Guidance in New Circular

            On 1 July 2025, the MOH issued Circular No. 31/2025/TT-BYT (Circular 31), which further details how the amended Law on Pharmacy and Decree 163 should be implemented. Circular 31 officially replaces Circular No. 07/2018/TT-BYT and Decree 54 and came into effect immediately.

            Key provisions of Circular 31 include:

            Notification of Practising Pharmacists

            Pharmaceutical businesses that are not part of a pharmacy chain must inform the relevant authority of a list of people currently working at the business who hold pharmacy practice certificates. This notification must be submitted within 15 days of the date the certificate allowing the pharmaceutical business to operate was issued, or when there are any changes to the list. This is a shorter deadline than the previous 30 days under earlier rules.

            Pharmacy chains have similar notification duties and deadlines. Specifically, the chain operator must inform the provincial authority where each pharmacy in the chain is located about the list of practising pharmacists at those sites. Additionally, pharmacy chains must notify the authority if pharmacies are added or removed from the chain, and if there are any rotations of the people responsible for pharmaceutical expertise between pharmacies within the chain.

            Medicine Information Activities

            Under Circular 31, medicine information can still be given to healthcare professionals through information materials, seminars, and medical representatives.

            However, Circular 31 introduces a significant change by removing the need to obtain a certificate for medicine information content before carrying out these activities. Under the new rules, pharmaceutical businesses, representative offices of foreign pharmaceutical companies in Vietnam, and MA holders are now responsible for creating and distributing medicine information materials. These materials must comply with the package inserts for medicines approved by the MOH, the Vietnamese National Drug Formulary, and any related documents and professional instructions issued or recognised by the MOH.

            Donald Trump, never one to shy away from drama or diplomacy-via-caps-lock, has slapped a 50% tariff on all Brazilian exports to the United States. The justification? In his own delicate prose: „The treatment of former President Jair Bolsonaro is a disgrace… A witch hunt that must end IMMEDIATELY!“

            And just in case anyone thought this was about trade imbalances or economic strategy, Trump made things crystal clear: „Due to Brazil’s insidious attacks on free elections…“.

            In short, the 50% tariff isn’t about coffee, orange juice, or flip-flops. It’s about a Supreme Court judgment, applying Brazilian law, regarding Brazilian politicians accused of conspiring in a coup d’état. In other words, this is a brazen (and frankly absurd) attempt at judicial intervention via trade war.

            Trump, with his characteristic subtlety, offered a solution: manufacture in the U.S., and he’ll look kindly upon Brazil, like a mafia don offering „protection“ after smashing your shop window. But what he meant was: consider Bolsonaro innocent, and we’ll talk.

            The Brazilian market took the bait

            Although the fishy interference in Brazilian affairs was determined from a fish out of the water, the market took the bait: in the first 48 hours after the infamous letter, at least 1500 tons of fish were already held in Brazilian ports, as US buyers suspended their contracts due to uncertainty about the costs upon arrival. The fish market is on alert, as 80% of the exports head to the US, mainly coming from small family-owned industries that distribute the catch from artisanal fishing communities.

            The same effect hit other sectors, from orange, honey, and coffee to aircraft.

            Brazil’s response and sorcery: don’t mess with us (or our weather)

            Naturally, Brazil will not sit quietly sipping caipirinhas while its sovereignty is trampled. Reciprocity is on the table: if Washington raises tariffs, Brasília can do the same. But above all, one thing is sure: Brazil will never tolerate foreign interference in its independent judiciary.

            And then, a curious coincidence: right after Trump’s speech, a tornado accompanied by lightning struck the White House grounds. Pure chance? Maybe. Or could it have been the work of Brazilian indigenous shamans, a particularly well-organized group of umbanda practitioners, or simply the fact that, as every Brazilian child knows, God is Brazilian.

            Trump might want to check the weather forecast next time before penning another angry letter.

            The unpredictable becoming predictable

            Trade wars are rarely tidy affairs, but one thing they consistently deliver is chaos (in legal terms, disruption). And when disruption meets contracts, force majeure disputes often end up in court.

            At first glance, Trump’s decision to impose a 50% tariff overnight might feel like an unpredictable thunderbolt (quite literally, given the weather at the White House). But here’s the catch: by now, unpredictable tariffs are becoming predictable. When a government with a well-documented love for impulsive economic diplomacy imposes politically motivated tariffs, can anyone claim to be surprised?

            In most jurisdictions, force majeure requires that the event be extraordinary, unforeseeable, and beyond the parties’ control. A sudden 50% tariff certainly ticks a few of those boxes, but following a repetition of erratic trade policy, one might argue that businesses should expect what in past times was considered unexpected, especially when dealing with certain jurisdictions or political figures. In other words, Trump’s tariffs might not excuse performance if parties didn’t prepare for exactly this kind of volatility.

            This is where good contract drafting comes into play

            Savvy businesses are learning that their contracts must go beyond a vague boilerplate clause about “acts of government” or “changes in law.” Instead, they should expressly address the risk of sudden tariff changes, including

            • hardship clauses that allow renegotiation when costs become commercially unreasonable;
            • price adjustment mechanisms linked to tariff thresholds;
            • termination rights triggered by specified levels of customs duties;
            • currency fluctuation provisions (because tariffs rarely travel alone, and currency swings often accompany them).

            In short, while no contract can immunize a business from every shock, smart drafting can mean the difference between a commercial headache and a catastrophic breach.

            Therefore, tariffs may no longer be an unpredictable storm; they are part of the new predictable landscape. Given that your contract might wake up tomorrow facing ‘IMMEDIATE’ punitive tariffs in all caps, your contract should be ready today.

            The unwitting cupid: strengthening EU-Brazil relations

            While the tariffs may ruffle trade flows between Brasília and Washington, there’s an unintended silver lining: Trump is proving to be the most efficient matchmaker between Brazil and other markets, such as China and the European Union.

            The EU-Brazil relationship, already a flirtation with promising prospects, with relevant progress in the EU-Mercosur Agreement, now seems destined for deeper romance. If Mr. Trump insists on isolating the US from Brazil, the old continent stands ready, with flowers and wine in hand, to pick up where the US left off. After all, Brazilian fish can pair up nicely with champagne, cava and prosecco.

            So thank you, Mr. Trump. In your quest to bully Brazil into submission, you may have done more to strengthen transatlantic ties than any EU Commissioner ever could. As they say in Brasília these days: Trump is not a trade warrior. He’s a cupid in disguise.

            The recent announcement of a landmark trade agreement framework, following just three months negotiations since President Trump’s tariffs announcement on 2 April 2025, signals a pivotal shift, not merely in bilateral relations, but in the broader architecture of global supply chains.

            As a commercial lawyer with exposure to Vietnam since 2007, I have observed the evolving dynamics between the United States and Vietnam through the years, talking to students, entrepreneurs, veterans, diplomats, humans from all walks all life, from both nations and beyond.

            You may recall that Vietnam, with the notable exclusion of China, was to be the nation that would encounter the most stringent tariffs imposed by the Trump administration, reaching an astonishing 46%.

            The newly forged framework outlines significant reciprocal concessions designed to foster greater trade and investment flows. Granted, pre-April 2 tariffs applied by the USA on Vietnamese goods were lower than what emerges from the framework agreement, but still, it is better than 46%),

            The United States has committed to imposing a 20% tariff on most Vietnamese imports, a notable reduction from the previously mooted 46%. However, a substantial 40% tariff will apply to goods re-exported from third countries, with a particular focus on those originating from China.

            Vietnam has pledged to open its market to a wide array of US products. Crucially, it has also committed to implementing stringent measures aimed at restricting the transshipment of Chinese goods through its territory, a long-standing concern for Washington.

            In a significant win for American exporters, US goods will now enjoy duty-free access to the Vietnamese market, effectively granting “total access”, particularly for large-engine vehicles such as SUVs, as emphatically stated by President Trump (how SUVs are going to circulate in the narrow alleys of Hanoi and Ho Chi Minh City, infested by swarms of mopeds, is a different story).

            This agreement is expected to catalyse growth in several key sectors. Electronics, textiles, furniture, energy (especially Liquefied Natural Gas), and agriculture are poised for expansion. US firms specialising in manufacturing technology, energy solutions, and agricultural products are anticipated to be the primary beneficiaries. Furthermore, beyond immediate trade benefits, the agreement is set to reshape investment strategies, encouraging a greater localisation of supply chains within Vietnam. This strategic realignment is also expected to further solidify the already robust US-Vietnam Comprehensive Strategic Partnership.

            While the potential upsides are considerable, it is imperative for businesses and investors to approach this new landscape with a clear understanding of the accompanying risks. From my vantage point, I identify several significant execution challenges and structural impediments that require close monitoring.

            Enforcement of Transshipment Controls

            The most immediate and perhaps formidable risk lies in the effective enforcement of transshipment controls. Vietnam has historically served as a significant assembly point for Chinese-manufactured components. Ensuring that goods originating from China are not merely re-routed through Vietnam to circumvent US tariffs will require exceptionally close monitoring and robust verification mechanisms. The legal and practical complexities of definitively determining the true country of origin for all goods will undoubtedly pose a persistent challenge. As a European citizen, witnessing how the EU-Vietnam Free Trade Agreement (“EVFTA”), which poses an important stress on certificates of origin, I am particularly aware of this matter.

            While Vietnam has made remarkable strides in its economic development, certain structural issues could hinder its capacity to scale up high-value manufacturing in the short to medium term. These include:

            Legal framework nuances

            Vietnam’s legal framework for foreign investment has seen continuous improvements, but legal and cultural complexities and inconsistencies can and do still arise. Navigating the regulatory landscape, particularly with new rules stemming from this agreement and at a time of deep administrative, governmental, digital and legal reforms in Vietnam, will demand expert legal guidance to ensure compliance and mitigate potential fines and disputes. Issues surrounding so-called sublicences for businesses, intellectual property rights enforcement and contract enforceability, whilst improving, still require careful consideration;

            Education

            The ambition to transform Vietnam into a high-value manufacturing hub necessitates a workforce equipped with advanced skills. While the Vietnamese government prioritises education and workforce development, a significant portion of the current labour force lacks formal training and specialised certifications, let alone a good command of the English language. Bridging this skills gap, particularly in areas like advanced manufacturing, engineering, and digital technologies is a necessity and not just in light of this framework agreement. Companies may need to factor in substantial investment in training and upskilling programmes for their Vietnamese employees.

            Infrastructures

            Despite considerable investment, Vietnam’s infrastructure, particularly in logistics, energy, and transportation, continues to face bottlenecks. And China – the apparent target of Trump’s tariffs – is stepping in with high-speed trains connecting it to the northern Provinces of Vietnam. An increased volume of high-value manufacturing and trade will place further strain on existing infrastructure. Inadequate port capacity, congested roads, and a reliable energy supply (including for EV charging) are critical concerns that could impact efficiency and increase operational costs for businesses.

            Policy divergence

            This framework agreement deepens US-Vietnam trade ties and seems to be paving the way for more US investments in Vietnam, but this second aspect seems to run counter to parallel US policy objectives aimed at reshoring manufacturing back to the United States. This potential divergence in strategic priorities could introduce yet another element of unpredictability in the long term, necessitating a flexible and adaptable investment approach. Future shifts in US policy could impact the durability and full extent of the benefits derived from this agreement.

            This trade agreement, if finalised and implemented, undoubtedly represents a structural shift in global trade dynamics. It strategically positions Vietnam as an increasingly important high-value manufacturing hub and significantly deepens US engagement in Southeast Asia. We will need time, however, to assess the practical impact of the agreement, observing the efficacy of its implementation, and understanding how Vietnam’s inherent strengths and challenges will ultimately shape its role in the reconfigured global supply chain.

            We will also need to see what China, if anything, will do as a countermeasure. In fact, any assessment of Vietnam’s evolving trade landscape would be incomplete without a thorough consideration of China’s influence and strategic posture. President Xi Jinping has consistently championed a vision of a “community of shared future for mankind,” a concept that, while outwardly promoting global cooperation, also subtly underscores a demand for international alignment with Beijing’s interests. In the context of escalating trade tensions, Xi has repeatedly warned that “trade wars have no winners,” advocating for unity against protectionist measures, yet simultaneously implying that nations must ultimately choose sides, either with or against China’s economic and political orbit. Vietnam, despite its historical complexities and occasional maritime disputes with Beijing in the South China Sea (or East Sea, as it is officially called by Hanoi), remains deeply interwoven with China’s economy. China has been Vietnam’s largest trading partner for many years, with significant inflows of Chinese FDI, loans, and project contractors. This economic dependency is particularly evident in various sectors, where Chinese components and materials form a substantial part of Vietnamese manufacturing supply chains. While Vietnam has actively sought to diversify its trade partners and reduce its reliance on China, the sheer scale of the bilateral economic relationship means that disentanglement is a long-term, complex endeavour. Furthermore, China’s influence extends beyond direct trade into crucial regional resources. The Mekong River, a lifeline for millions in Southeast Asia, originates in China, which has constructed numerous upstream dams.

            As Vietnam navigates its enhanced trade relationship with the United States, it must simultaneously contend with the enduring economic gravity and strategic ambitions of its northern giant neighbour. Any perceived move by Vietnam to significantly shift away from China could invite retaliatory measures or heightened pressure from Beijing. Businesses investing in Vietnam must not only grasp the intricacies of the US-Vietnam agreement but also meticulously analyse how these developments will intersect with, and potentially be impacted by, the intricate, often delicate, and sometimes fraught relationship between Hanoi and Beijing. Understanding this geopolitical tightrope will be essential for sustainable success in the Vietnamese market. Prudence, informed legal counsel, and a keen eye on evolving geopolitical and economic realities will be paramount for those seeking to capitalise on this transformative new chapter.

            Takeaways

            • Tariffs:The US-Vietnam framework agreement marks a significant departure from previous trade dynamics, reducing US tariffs on most Vietnamese imports to 20% (from a mooted 46%) while imposing a 40% tariff on transshipped goods, especially from China.
            • Vietnam’s market opening:Vietnam has committed to duty-free access for a broad range of US products and stricter controls on Chinese goods transiting its territory.
            • Growth / manufacturing shift potential:The agreement is expected to fuel expansion in Vietnamese electronics, textiles, furniture, energy (LNG), and agriculture. It also encourages supply chain localisation within Vietnam (normally more of an assembly point for Chinese products).
            • Execution challenges: Effectively preventing the re-routing of Chinese goods through Vietnam to avoid tariffs will be a complex and demanding task; Despite economic progress, Vietnam faces hurdles in scaling high-value manufacturing due to legal framework nuances (e.g., sublicences, IP enforcement), a skills gap in its workforce (lack of formal training, English proficiency) and infrastructure bottlenecks (logistics, energy, transportation).
            • US policy divergence:The agreement’s encouragement of US investment in Vietnam appears to contradict the broader US policy objective of reshoring manufacturing.
            • China:Businesses must consider China’s significant economic sway over Vietnam, including its position as Vietnam’s largest trading partner, its FDI, and its control over shared resources like the Mekong River. Any major shift by Vietnam away from China could lead to retaliatory measures from Beijing.
            • Uncertainty:This is not a final agreement, so the situation might change. Prudence and informed legal counsel are crucial for businesses navigating this evolving landscape.

            The Trump approach: power and dominance

            In his autobiography, The Art of the Deal, Donald Trump describes negotiation as a contest of strength, determination, and dominance. His vision is clear: anyone who shows uncertainty or makes concessions too early is immediately perceived as a loser. His negotiating style is based on constant pressure, maximalist demands, and calculated threats, to obtain unilateral advantages. In this scheme, compromise is not a point of arrival, but a sign of weakness to be avoided.

            Trump has always been a competitive negotiator, focused on immediate results and uninterested in balanced solutions unless they are strictly functional to his interests.

            Other negotiating styles: compromising and collaborative

            In contrast to this competitive approach, there are two other relevant negotiating styles:

            • The compromising style aims to reach a ‘middle ground’ agreement, in which both parties give something up to achieve an acceptable solution. It is a pragmatic approach, practical in situations where time is limited or positions are too far apart for genuine collaboration.
            • The collaborative style, on the other hand, aims to create win-win solutions. The parties seek to thoroughly understand each other’s interests and work together to build an outcome that maximizes the benefit for both. It requires openness, time, and trust.

            In commercial negotiations, the compromising or collaborative approach can only work if the other party shares the same logic. But when dealing with an explicitly competitive actor such as Trump, adopting a compromising style risks seriously penalizing the other party, for at least three reasons:

            • It conveys weakness

            An accommodating gesture is seen not as a sign of openness, but as a point of pressure to be exploited. The competitive negotiator, focused on gaining an immediate advantage, interprets it as a willingness to give even more.

            • It relinquishes bargaining power

            The EU has a vast market and significant trade levers, especially in a context where the US is closing the door to the Chinese market. Offering concessions at the outset is tantamount to burning your cards without getting anything in return. In a competitive confrontation, the first move can set the tone for the negotiation: once a concession has been made, it is very difficult to backtrack.

            • It legitimizes the negotiating imbalance

            An unbalanced compromise, if accepted without resistance, risks becoming the new basis for future trade relations, systematically penalizing the EU in subsequent rounds.

            Why 30%? The anchor technique

            Trump often uses a negotiating technique known as the anchor technique. This consists of deliberately setting a very high target at the beginning of the negotiation (in our case, the threat of 30% tariffs).

            The aim is to create a psychological perimeter for the negotiation and force the other party to reason on the basis of that figure, even though they are aware that it is arbitrary. This technique allows one to influence the scope of the discussion and obtain greater concessions, just as Trump has done.

            The worst response: unilateral concessions with no return

            Unfortunately, the European Union has already shown worrying signs of a compromising attitude that has not been negotiated with the Trump administration, for example:

            • The waiver of the web tax* on American digital giants, without obtaining any regulation or shared tax contribution in return.
            • The offer to increase imports of liquefied natural gas (LNG) from the US, made to reassure Washington, without obtaining anything in return.
            • The acceptance of the increase in NATO spending to 5% of GDP, demanded by Trump, again without obtaining anything in return.

            All these offers without asking for anything in return reinforce the idea that the EU is willing to concede from the outset. Trump, true to his competitive logic, sees these concessions as a starting point, not a compromise: this pushes him to raise his demands, not moderate them.

            Persevering would be a fatal mistake

            Continuing along this path of compromise, in the hope that accommodation will ease the pressure, would be not only ineffective but counterproductive. With a competitive negotiator, unilateral concessions do not stop escalation: they fuel it. Any sign of weakness is interpreted as additional room for maneuver.

            A helpful example is China’s reaction during the trade war initiated by Trump. Faced with massive tariffs imposed by the US, Beijing responded in kind, imposing equivalent tariffs. Instead of giving in, it spoke the same language of power. The result is there for all to see: after weeks of escalation, the US had to moderate its position, opening up to a more balanced agreement.

            The right strategy: speak his language

            To avoid the mistakes of the past, the EU should therefore reverse its negotiating logic. Not to fuel confrontation, but to restore a credible balance. Some applicable countermeasures could be:

            • Target Trump’s electoral base, particularly the agricultural sectors (soy, corn, beef), with selective tariffs or targeted restrictions.
            • Put the European web tax* back on the table, even with a minimum rate, linking any exemptions to real concessions from the US.

            These well-calibrated moves would strengthen the EU’s position and show that it can defend its interests by speaking a language Trump understands: that of strength and bargaining power.

            Going beyond requests, seeking the other party’s interests

            A fundamental principle in any negotiation is to identify the other side’s interests and find a way to allow them to achieve them without sacrificing your own. This is no easy task, given Trump’s notorious volatility and the lack of sound arguments to justify the demands made in the negotiations.

            In the case of the EU-US negotiations, it must be borne in mind that Trump is playing the game with his electoral base in mind: an agreement must offer him a narrative of victory to communicate to his electorate.

            Takeaway

            When negotiating with a competitive player like Trump, one should abandon the accommodating approach, avoid concessions without something in return, and adopt a style that is more assertive, strategic, and symmetrical.

            Only then will it be able to build an agreement that is solid, fair, and respectful of its economic and political strength.

            I have often dealt with commercial distribution agreements between Italian and Chinese companies, sometimes following negotiations in the wine sector for various types of agreements: sales, distribution, franchising, establishment of joint ventures, and sales through online stores.

            I am sharing some key considerations for approaching this complex but opportunity-rich market.

            📌 Here are my 10 takeaways

            Step Zero. Protect your IP

            it is essential to protect your intellectual property before entering China. This includes trademarks (including their Chinese transliteration), labels, web domains, and social media accounts. Neglecting this aspect can have disastrous consequences, exposing you to the widespread phenomenon of trademark squatting (even famous names such as Michael Jordan, Elon Musk, and Donald Trump have fallen victim to this).

            For more information, you can read this article about Intellectual property protection in China

            1 – Know your enemy

            trust is good, but mistrust is better. Before entering into commercial agreements, it is essential to check the credentials of potential partners through the databases of the State Administration for Industry and Commerce. When it comes to wine, it is necessary to check whether the prospective distributor has a license to import and distribute wine.

            2 – No copy-paste

             Contracts must be tailor-made, adapting them to local specificities. In particular, it is crucial to clearly regulate promotional activities: budget, commercial actions, communication methods, and management of the producer’s trademarks. It is also best to write the contract in Chinese to ensure that there are no misunderstandings and in case it needs to be used before a judge or local administrative body, as Chinese is the only official language. (N.B.: if you think of entrusting the task to ChatGPT, this is not a good idea).

            For an in-depth article, check out The commercial distribution contract in China

            3 – Decide immediately how and where to litigate

            It may seem counterintuitive, but it is best to avoid providing for Italian (or French, or German) jurisdiction and applicable law, which is an ineffective solution, especially in cases where urgent action is needed to stop unfair competition or counterfeiting. Consider applying Chinese law and provide for an arbitration clause at CIETAC. An effective dispute management strategy is a key element of the agreement and must be negotiated carefully. (P.S.: This applies not only to China but to all international agreements. For more information, see this article).

            4 – China is big

            And it is the sum of many very different internal markets. Exclusivity should be granted for good reasons, but only if the distributor has a well-developed commercial network and can achieve specific shared objectives. If granted, it should be limited to the province where the distributor is based and subject to the achievement of agreed sales volumes. Having a single distributor for the whole of China is like entrusting an Italian distributor with promoting a product throughout Europe. Or appoint a NYC-based company to promote and sell your wines in all 50 US States.

            5 – China is far away

            Delegating everything to the local distributor and taking no interest in what is happening on the Chinese market is never a good idea. Firstly, because you have no idea how, where, and with what results the wines are being sold. Secondly, because you cannot verify compliance with agreements, for example on non-competition or the use of trademarks. It is therefore important to schedule meetings to share commercial policies and be able to verify what is happening, including through audits and visits to warehouses and the sales network.

            6 – China is expensive

            Competition in the Chinese domestic market is fierce. This is also true in terms of price, as some countries that are direct competitors of Italy (Australia, Chile, New Zealand) have free trade agreements and can therefore enter the market on more favorable terms than Italian wine, which is subject to a total tax burden of around 43% after payment of duties, excise taxes, and VAT. It is necessary to position oneself in the right market segment (medium-high), and to do so, it is necessary to plan the right commercial actions together with the distributor. Selling Ex-Works and hoping that the distributor will take care of everything is not an excellent strategy for being competitive.

            7 – China is dangerous

            Scams are always around the corner. In the wine world in particular, for example, spontaneous expressions of interest are frequent, arriving via the company website, social media accounts, or directly via email. They sound like this: we have discovered your wines, we think they are fantastic, we want to place an order immediately. If it sounds too good and easy, it is certainly a scam. There is an easy way to check: if the next step is a request for payment of a few thousand euros, justified by the need to register the wines on the CIFER (China Imported Food Enterprise Registration) portal, or to register your trademark to prevent others from doing so, or to authenticate the signature on the sales contract… these are attempts at fraud, and the elusive order will never arrive after payment has been received. How can you check whether the person you are dealing with is a reputable company or a fraudster? 👉🏼Go back to point 1 (here is an in-depth article).

            8 – E-commerce? Yes, but with method (and money)

            Online wine sales continue to grow, but entering large platforms is complex, competition is fierce, and running an online store requires meticulous planning and highly efficient system implementation. The online market in China is all pay-for-play. Nothing is achieved with no money or minimal effort. If you want to sell online, you need to build an omnichannel system integrated with traditional distribution, and to do this, it is essential to involve a local partner with well-defined investments and responsibilities.

            9 – China is not a market for everyone

            You need to protect your brands, study the market thoroughly, know your competition (both foreign and local), find the right market channel, select a distributor motivated to invest time and money in promoting your product, and be willing to support them with the right investments. If you want to build a serious plan to enter the Chinese market, you must have a medium- to long-term perspective. There are no shortcuts (actually, there are many, but they almost always lead to wasted time and money). If you are unwilling to invest in entering the Chinese market through the front door, it is unlikely that anyone else will do it for you.

            10 – Don’t do it yourself

            If you have read up to point 9 and are still keen to enter the Chinese market, consider doing so professionally, involving consultants who can support your company throughout the market research, scouting, negotiation, and contract drafting processes. This is also part of the investment needed to build and develop a solid and resilient business model. This advice applies to all foreign markets, and even more so to China.

            The most dangerous mistake one can make after the announcement of the (partial) suspension of U.S. duties for 90 days is to hope that everything will go well and we will return to the pre-April 2 world.

            First, because very invasive tariffs remain in place: 10 percent on all countries that trade with the U.S., including the EU, 25 percent on automotive, 25 percent on steel and aluminum, 145 percent on China.

            Second, because it is impossible to predict the actions of the U.S. Administration in the short and medium term: it cannot be ruled out that tariffs will remain, increase, change targets or that other factors will intervene to turn the tide in international markets, such as an escalation of the trade war with China.

            The 90-day suspension is an opportunity

            The U.S.’s temporary suspension of tariffs represents a valuable window that should be used not only as a truce but also as a valuable room for action: 90 days to rehash contracts, renegotiate key clauses, and insert levers of flexibility that can protect business in various future scenarios in the U.S. and other markets.

            Today’s exporters cannot afford to „sit back and see what will happen“-it is time to act, and to do so professionally and strategically. Let’s look at a checklist of important points to consider.

            What do contracts with customers and suppliers entail?

            The first point is to survey agreements with the trade network in the U.S. and other countries that export to the U.S., as well as with upstream suppliers in the supply chain.

            Is there a written contract? The worst-case scenario – unfortunately a very frequent one – is when the parties cooperate informally, only based on orders and order confirmations. This leaves undefined not only what happens in the case of imposition of duties, but also a whole range of other points, for example, limits on damages that can be claimed in the case of breach of contract, the duration of the agreement, the applicable law, and how any disputes will be resolved.

            Another very problematic scenario is one in which contracts exist, but they are generic and do not include the necessary covenants to manage the risks involved in operating in a highly litigious market such as the U.S., which, moreover, has very high legal costs.

            Having done this analysis, the necessary actions can be put in place, prioritizing according to the importance of business relationships and as appropriate:

            • Negotiate and conclude a written contract from scratch
            • Replace the existing agreement with a complete and correct contract
            • Amend and integrate the existing agreement with pacts to manage tariffs and other causes of price fluctuations

            Let us dwell on the last scenario, assuming that there is a complete and correct contract but one that does not regulate price and cost fluctuation as a direct or indirect consequence of the introduction of duties.

            Contract Addendum

            In such cases, the correct course of action is to sign an Addendum to the original contract, specifying which covenants are being waived and which covenants are being added. It is essential that the Addendum be negotiated and signed by persons with the power of representation of the parties and that it be drafted with the help of lawyers who specialize in this field. In addition to including correct clauses, it is necessary to verify that the covenants are valid according to the rules of law applicable to the contract.

            Here are some clauses that can be the subject of the Addendum, to be modulated according to the specific case and possible scenarios.

            Tariff Cost Sharing

            By introducing this covenant, it is provided that in the event that duties are confirmed at [x]% or are reduced or increased within certain established thresholds, the Parties will share the increase equally, or according to other established percentages.

            There may also be a ceiling on tariffs beyond which a party has the right to withdraw from the contract or request the suspension of certain orders for a specified period of time, after which it has the right to withdraw.

            Price Adjustment

            With this covenant, a discount or an increase in the product’s price is agreed upon, as the case may be, in the case of a duty greater than [x]%.

            Among the use cases, in addition to that of the company exporting to the U.S. or other intermediate markets, with final destination of the products in the U.S., is that of those who purchase a product subject to import duty and resell it, processed or assembled.

            Right to Cancel or Postpone Confirmed Orders

            This covenant gives the right to revoke or suspend for a certain period already negotiated orders, as such binding, in case of confirmation or introduction of duties above a certain threshold, for example, if 20% taxation was confirmed for the import of wine from the EU.

            The clause can be combined with previous covenants, for example, by stipulating that below the specified threshold, the contracts remain valid, and the parties share the duty or have the right to renegotiate the price.

            Supply Forecast Adjustment

            With this clause the Parties can modify supply programs already agreed for a specific duration (e.g., 24 months), with continuous sales and purchase obligations at a fixed price or indexable only within certain limits. The aim is to agree on the prerequisites for reshaping supply programs in the short and medium term, which can be very useful for defining the rules that will apply to relationships with key suppliers or customers for possible changes in volumes, delivery times, and prices.

            Right to Source from Alternative Suppliers

            This covenant serves to be authorized, if necessary, to source alternative suppliers of components or raw materials to those previously authorized in the contract with the end customer, for example, in cases where purchasing from the original suppliers has become too costly or difficult due to duties imposed at import or in previous steps in the supply chain, or other events such as currency or price fluctuation of certain commodities beyond a certain level established in the agreement.

            Hardship and Force Majeure

            The imposition of duties cannot be invoked as a cause of Force Majeure or hardship, respectively, to excuse contract non-performance or to renegotiate the price, even in cases of very high price increases (such as the 145% duty imposed on Chinese products). This conclusion is almost uniform under the law and jurisprudence of the major countries involved in the tariff war: U.S., China, Canada, Mexico, France and Italy: I refer to this practical guide for a timely examination of what the various rules provide.

            If the contract lacks a well drafter Force Majeure and Hardship clause, or contains a generic clause, it is important to get your hands on revising it to expressly state the cases in which a party is entitled to suspend or terminate the contract, how and when to communicate the decision to invoke the exemption, and the consequences on the parties‘ contractual obligations. You can go deeper on this topic here.

            Conclusion

            It is essential to prepare for possible future scenarios regarding duties (confirmed, increased, changed, or decreased) and to determine the consequences on trade relations with foreign clients and suppliers: moving today, at a standstill (or nearly so), allows entrepreneurs to negotiate shared and fair solutions and to avoid, as far as possible, the emergence of tensions and conflicts with the various partners along the international supply chain.

            Roberto Luzi Crivellini

            Rechtsgebiete

            • Schiedsgerichtsbarkeit
            • Vertrieb
            • Internationaler Handel
            • Rechtsstreitigkeiten
            • Immobilien
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              US Tariffs | Commercial risk management in contracts with international clients and suppliers 

              14. April 2025

              • USA
              • Vertrieb
              • Steuer

              It is quite common for business relationships with agents or distributors to last for years without any signed documents. And be careful, because we know that a contract can exist even verbally.

              The absence of a written contract will add difficulties in the event of a possible claim, so what you do between the decision to terminate, and the moment of the claim is very important. Remember: ‘anything you write will be used against you’.

              The decision to terminate a business relationship is a very delicate moment to which, for some reason, solicitors are not invited. Here are some examples (all real) in which companies or employees with the best of intentions wrote to the agent/distributor. All of them were subsequently very damaging to the company:

              Saying ‘We are terminating our business relationship’ when the strategy will be to argue that no such business relationship exists, but rather that there are separate and linked contracts (e.g., supply rather than ongoing distribution contract; very significant compensation consequences).

              ‘You no longer represent our company’, which may be evidence that you did so before.

              ‘As of day X, you may no longer act on behalf of our company,’ which would prove that you were previously able to act on its behalf.

              ‘You may not attend the X trade fair on our behalf.’ A way of confirming that the agent/distributor’s responsibilities included participating in trade fairs and probably accrediting the customers obtained.

              ‘The sales you promoted have been significantly reduced in year N.’ When there is no written contract or other form of documentation, imputing a breach of an obligation that is not clear can be counterproductive.

              Saying ‘You are not actively promoting our products’ and then adding: ‘We urge you to stop promoting the sale of our products’.

              ‘You are no longer our exclusive representative’, which proves a type of relationship (representation/agent) and a tacit or express agreement (‘exclusivity’).

              ‘We have appointed another representative in your area’, which shows that the agent/distributor had an assigned area and was “representing”.

              ‘From this moment on, orders will be handled by X’, which also confirms a type of relationship.

               

              In summary: from the moment the company considers terminating a commercial relationship, especially when it is not in writing and before sending any letter, it is advisable to think carefully about the strategy in case of a possible claim. This is the best time to seek advice and avoid surprises. Any communication that is not in line with this strategy designed from the outset can only lead to confusion and problems.

              Remember the USA – EU agreement on 15% tariffs? I wrote that with a negotiator like Trump the game is never over (article here) and—after the recent interlude featuring a threat of 100% tariffs on pharmaceuticals—the U.S. government has announced the imposition of an overall 107% duty on Italian pasta, which could take effect on January 1, 2026.

              Where this new duty comes from

              The antidumping investigation was launched by the U.S. Department of Commerce at the request of certain competing American companies and is based on a 1996 antidumping order that allows for periodic reviews of imports of Italian pasta. The Department of Commerce conducts these checks annually to assess whether Italian producers are selling pasta at prices lower than the U.S. domestic market, a practice known as “dumping.”

              Companies involved in the investigation

              The Department of Commerce selected two sample companies for in-depth analysis, defined as “mandatory respondents”: La Molisana and Pastificio Lucio Garofalo. According to the official document published by the U.S. administration, for the period from July 1, 2023 to June 30, 2024, both companies allegedly sold their products below market prices, resulting in the imposition of a duty of 91.74%.

              U.S. authorities justified this percentage by claiming the two companies did not provide complete or compliant information as requested by the Department and were therefore insufficiently cooperative during the investigation. What is very important is that, in addition to the two companies directly examined, the additional 91.74% duty is also applied to numerous other Italian producers not individually reviewed. This methodology, while formally permitted under U.S. law as an exception, is being applied without any direct verification of the other companies.

              Next steps in the procedure

              Italy’s Ministry of Foreign Affairs moved immediately, formally intervening in the proceeding as an “interested party” through the Italian Embassy in Washington. The Foreign Ministry is working in close coordination with the companies concerned and, in concert with the European Commission, to persuade the U.S. Department to revise the provisional duties.

              The two companies involved (La Molisana and Garofalo) can submit documentation to contest the dumping allegations. However, if dumping is confirmed, the Department of Commerce will instruct Customs to apply antidumping duties on goods sold and entered into U.S. commerce.

              The preliminary nature of this determination means there is still room to change the decision before it becomes final.

              Possible effective date

              The new super-duty of 91.74%, which will be added to the existing 15% tariff for a total of 107%, is scheduled to take effect on January 1, 2026. This date therefore represents a crucial deadline for all ongoing diplomatic and legal actions.

              If confirmed, the economic impact would be significant: in 2024, Italian pasta exports to the United States reached a value of €671 million according to Coldiretti, accounting for nearly 17% of the sector’s total exports. A 107% duty would risk seriously undermining competitiveness in one of the most important markets for Italian agri-food products.

               What to do between now and January 1, 2026?

              At this stage, the entry into force of the new duty depends on the outcome of the ongoing procedure: given what has happened in recent months, and the political use the U.S. administration has made of tariffs—well beyond their technical function—it is reasonable to be pessimistic.

              So, what to do? In recent months we have seen companies react to the uncertainty over the fate of the tariffs in three ways:

              • Some rushed to ship as many products as possible before the potential effective date of the duty;
              • Some granted—upfront—discounts equivalent to the threatened duty, in case it came into force;
              • Some suspended orders, pending definitive news on the impact of the duties.

              These are all  valid options, but other effective tools for managing the uncertainty caused by the flurry of announcements, negotiations, and threats from the U.S. administration should not be forgotten: the risk of new duties being introduced, or existing ones being increased, can be managed in the contract by agreeing with the U.S. importer how any tariff change will affect the product.

              The parties can stipulate, for example, that the increase will be split equally; or that the importer will bear it beyond a certain threshold; or that if the duty exceeds a certain level, the contracts may be terminated. You can find a deeper dive in this article.

              The only certainty is that trade relations with the U.S. will stay unpredictable for a long time, and it’s vital to carefully manage the risk factors involved in selling products there. Right now, the focus is on tariffs and prices, and I encourage you to take this chance to thoroughly review existing agreements and assess whether—and how—other important points are addressed that could entail significant liabilities: we discuss them, very practically, in this book.

              On 29 June 2025, the Vietnamese government introduced Decree No. 163/2025/ND-CP (Decree 163). This decree provides detailed guidance on how the updated Law on Pharmacy will be implemented.

              Like the amended Law on Pharmacy, Decree 163 came into effect on 1 July 2025, replacing the previous Decree No. 54/2017/ND-CP (Decree 54). The new decree sets out comprehensive rules for key aspects of managing pharmaceuticals, including:

              • Pharmacy practice certificates
              • Certificates allowing pharmaceutical businesses to operate
              • Import and export of medicines and drug ingredients
              • Good Manufacturing Practice (GMP) inspections of overseas manufacturers
              • Recalling medicines and drug ingredients
              • Certificates for medicine advertising content
              • Medicine price management

              Key Changes in Decree 163

              Here are some important changes and additions introduced by Decree 163:

              Destroying Specially Controlled Medicines

              You no longer need to get approval from the relevant authority before destroying narcotic, psychotropic, and precursor drugs, or pharmaceutical ingredients that are narcotic or psychotropic substances or precursors used in medicines. Instead, you just need to provide notification at least seven working days in advance. This notification must include the planned destruction date and a detailed list of items to be destroyed.

              E-commerce in Pharmaceutical

              Pharmaceutical businesses that sell products online must openly display the following information to ensure transparency and consumer safety:

              • Their certificate allowing them to operate as a pharmaceutical business.
              • The pharmacy practice certificate of the person responsible for pharmaceutical expertise.
              • Information about the medicines themselves.

              Shelf-Life Rules for Imported Products

              For medicines and ingredients with a total shelf life of nine months or less, at least one-third of their shelf life must remain when they clear customs. Medicines with a shelf life of 30 days or less must still be within their shelf life at the time of customs clearance.

              Controlling Imported Products

              All medicines with marketing authorisation (MA) are subject to import control, except for:

              • Medicines needed for preventing and treating Group A infectious diseases that have been declared epidemics, as per the Law on Prevention and Control of Infectious Diseases.
              • Medicines with a shelf life of less than 30 days.

              Importers must inform the provincial People’s Committee at least five working days before making a customs declaration. The People’s Committee can then issue a written notice of non-compliance to the customs authority within five working days of receiving this notification.

              Medicine Advertising

              Decree 163 adds a process that allows an approved medicine advertising certificate to be adjusted for certain changes (such as a change to the MA holder or manufacturer information). This means you don’t have to go through the entire initial registration process for medicine advertising content again, as was required under the previous rules.

              Medicine Price Management

              Businesses must announce or re-announce wholesale prices, similar to the medicine price declaration process under Decree 54. Some medicines are exempt from this requirement, including those provided free of charge for emergency responses, national health programmes, humanitarian aid, clinical trials, scientific research, or exhibition purposes, and medicines carried as personal luggage.

              The Ministry of Health (MOH) can make recommendations if the announced or re-announced price is significantly higher than similar medicines already on the market. This includes situations where:

              • The announced or re-announced wholesale price of the medicine is higher than the highest price of similar medicines.
              • The price difference is more than 35% (for medicines priced under VND 1 million) or 15% (for medicines priced at VND 1 million and above) compared to winning bid prices in tenders.
              • The announced or re-announced price is higher than prices in the country of origin or other markets (if there’s no similar product in Vietnam).
              • When such differences are found, the MOH issues a formal recommendation to the announcing business and publishes it online for transparency and accountability.

              Further Guidance in New Circular

              On 1 July 2025, the MOH issued Circular No. 31/2025/TT-BYT (Circular 31), which further details how the amended Law on Pharmacy and Decree 163 should be implemented. Circular 31 officially replaces Circular No. 07/2018/TT-BYT and Decree 54 and came into effect immediately.

              Key provisions of Circular 31 include:

              Notification of Practising Pharmacists

              Pharmaceutical businesses that are not part of a pharmacy chain must inform the relevant authority of a list of people currently working at the business who hold pharmacy practice certificates. This notification must be submitted within 15 days of the date the certificate allowing the pharmaceutical business to operate was issued, or when there are any changes to the list. This is a shorter deadline than the previous 30 days under earlier rules.

              Pharmacy chains have similar notification duties and deadlines. Specifically, the chain operator must inform the provincial authority where each pharmacy in the chain is located about the list of practising pharmacists at those sites. Additionally, pharmacy chains must notify the authority if pharmacies are added or removed from the chain, and if there are any rotations of the people responsible for pharmaceutical expertise between pharmacies within the chain.

              Medicine Information Activities

              Under Circular 31, medicine information can still be given to healthcare professionals through information materials, seminars, and medical representatives.

              However, Circular 31 introduces a significant change by removing the need to obtain a certificate for medicine information content before carrying out these activities. Under the new rules, pharmaceutical businesses, representative offices of foreign pharmaceutical companies in Vietnam, and MA holders are now responsible for creating and distributing medicine information materials. These materials must comply with the package inserts for medicines approved by the MOH, the Vietnamese National Drug Formulary, and any related documents and professional instructions issued or recognised by the MOH.

              Donald Trump, never one to shy away from drama or diplomacy-via-caps-lock, has slapped a 50% tariff on all Brazilian exports to the United States. The justification? In his own delicate prose: „The treatment of former President Jair Bolsonaro is a disgrace… A witch hunt that must end IMMEDIATELY!“

              And just in case anyone thought this was about trade imbalances or economic strategy, Trump made things crystal clear: „Due to Brazil’s insidious attacks on free elections…“.

              In short, the 50% tariff isn’t about coffee, orange juice, or flip-flops. It’s about a Supreme Court judgment, applying Brazilian law, regarding Brazilian politicians accused of conspiring in a coup d’état. In other words, this is a brazen (and frankly absurd) attempt at judicial intervention via trade war.

              Trump, with his characteristic subtlety, offered a solution: manufacture in the U.S., and he’ll look kindly upon Brazil, like a mafia don offering „protection“ after smashing your shop window. But what he meant was: consider Bolsonaro innocent, and we’ll talk.

              The Brazilian market took the bait

              Although the fishy interference in Brazilian affairs was determined from a fish out of the water, the market took the bait: in the first 48 hours after the infamous letter, at least 1500 tons of fish were already held in Brazilian ports, as US buyers suspended their contracts due to uncertainty about the costs upon arrival. The fish market is on alert, as 80% of the exports head to the US, mainly coming from small family-owned industries that distribute the catch from artisanal fishing communities.

              The same effect hit other sectors, from orange, honey, and coffee to aircraft.

              Brazil’s response and sorcery: don’t mess with us (or our weather)

              Naturally, Brazil will not sit quietly sipping caipirinhas while its sovereignty is trampled. Reciprocity is on the table: if Washington raises tariffs, Brasília can do the same. But above all, one thing is sure: Brazil will never tolerate foreign interference in its independent judiciary.

              And then, a curious coincidence: right after Trump’s speech, a tornado accompanied by lightning struck the White House grounds. Pure chance? Maybe. Or could it have been the work of Brazilian indigenous shamans, a particularly well-organized group of umbanda practitioners, or simply the fact that, as every Brazilian child knows, God is Brazilian.

              Trump might want to check the weather forecast next time before penning another angry letter.

              The unpredictable becoming predictable

              Trade wars are rarely tidy affairs, but one thing they consistently deliver is chaos (in legal terms, disruption). And when disruption meets contracts, force majeure disputes often end up in court.

              At first glance, Trump’s decision to impose a 50% tariff overnight might feel like an unpredictable thunderbolt (quite literally, given the weather at the White House). But here’s the catch: by now, unpredictable tariffs are becoming predictable. When a government with a well-documented love for impulsive economic diplomacy imposes politically motivated tariffs, can anyone claim to be surprised?

              In most jurisdictions, force majeure requires that the event be extraordinary, unforeseeable, and beyond the parties’ control. A sudden 50% tariff certainly ticks a few of those boxes, but following a repetition of erratic trade policy, one might argue that businesses should expect what in past times was considered unexpected, especially when dealing with certain jurisdictions or political figures. In other words, Trump’s tariffs might not excuse performance if parties didn’t prepare for exactly this kind of volatility.

              This is where good contract drafting comes into play

              Savvy businesses are learning that their contracts must go beyond a vague boilerplate clause about “acts of government” or “changes in law.” Instead, they should expressly address the risk of sudden tariff changes, including

              • hardship clauses that allow renegotiation when costs become commercially unreasonable;
              • price adjustment mechanisms linked to tariff thresholds;
              • termination rights triggered by specified levels of customs duties;
              • currency fluctuation provisions (because tariffs rarely travel alone, and currency swings often accompany them).

              In short, while no contract can immunize a business from every shock, smart drafting can mean the difference between a commercial headache and a catastrophic breach.

              Therefore, tariffs may no longer be an unpredictable storm; they are part of the new predictable landscape. Given that your contract might wake up tomorrow facing ‘IMMEDIATE’ punitive tariffs in all caps, your contract should be ready today.

              The unwitting cupid: strengthening EU-Brazil relations

              While the tariffs may ruffle trade flows between Brasília and Washington, there’s an unintended silver lining: Trump is proving to be the most efficient matchmaker between Brazil and other markets, such as China and the European Union.

              The EU-Brazil relationship, already a flirtation with promising prospects, with relevant progress in the EU-Mercosur Agreement, now seems destined for deeper romance. If Mr. Trump insists on isolating the US from Brazil, the old continent stands ready, with flowers and wine in hand, to pick up where the US left off. After all, Brazilian fish can pair up nicely with champagne, cava and prosecco.

              So thank you, Mr. Trump. In your quest to bully Brazil into submission, you may have done more to strengthen transatlantic ties than any EU Commissioner ever could. As they say in Brasília these days: Trump is not a trade warrior. He’s a cupid in disguise.

              The recent announcement of a landmark trade agreement framework, following just three months negotiations since President Trump’s tariffs announcement on 2 April 2025, signals a pivotal shift, not merely in bilateral relations, but in the broader architecture of global supply chains.

              As a commercial lawyer with exposure to Vietnam since 2007, I have observed the evolving dynamics between the United States and Vietnam through the years, talking to students, entrepreneurs, veterans, diplomats, humans from all walks all life, from both nations and beyond.

              You may recall that Vietnam, with the notable exclusion of China, was to be the nation that would encounter the most stringent tariffs imposed by the Trump administration, reaching an astonishing 46%.

              The newly forged framework outlines significant reciprocal concessions designed to foster greater trade and investment flows. Granted, pre-April 2 tariffs applied by the USA on Vietnamese goods were lower than what emerges from the framework agreement, but still, it is better than 46%),

              The United States has committed to imposing a 20% tariff on most Vietnamese imports, a notable reduction from the previously mooted 46%. However, a substantial 40% tariff will apply to goods re-exported from third countries, with a particular focus on those originating from China.

              Vietnam has pledged to open its market to a wide array of US products. Crucially, it has also committed to implementing stringent measures aimed at restricting the transshipment of Chinese goods through its territory, a long-standing concern for Washington.

              In a significant win for American exporters, US goods will now enjoy duty-free access to the Vietnamese market, effectively granting “total access”, particularly for large-engine vehicles such as SUVs, as emphatically stated by President Trump (how SUVs are going to circulate in the narrow alleys of Hanoi and Ho Chi Minh City, infested by swarms of mopeds, is a different story).

              This agreement is expected to catalyse growth in several key sectors. Electronics, textiles, furniture, energy (especially Liquefied Natural Gas), and agriculture are poised for expansion. US firms specialising in manufacturing technology, energy solutions, and agricultural products are anticipated to be the primary beneficiaries. Furthermore, beyond immediate trade benefits, the agreement is set to reshape investment strategies, encouraging a greater localisation of supply chains within Vietnam. This strategic realignment is also expected to further solidify the already robust US-Vietnam Comprehensive Strategic Partnership.

              While the potential upsides are considerable, it is imperative for businesses and investors to approach this new landscape with a clear understanding of the accompanying risks. From my vantage point, I identify several significant execution challenges and structural impediments that require close monitoring.

              Enforcement of Transshipment Controls

              The most immediate and perhaps formidable risk lies in the effective enforcement of transshipment controls. Vietnam has historically served as a significant assembly point for Chinese-manufactured components. Ensuring that goods originating from China are not merely re-routed through Vietnam to circumvent US tariffs will require exceptionally close monitoring and robust verification mechanisms. The legal and practical complexities of definitively determining the true country of origin for all goods will undoubtedly pose a persistent challenge. As a European citizen, witnessing how the EU-Vietnam Free Trade Agreement (“EVFTA”), which poses an important stress on certificates of origin, I am particularly aware of this matter.

              While Vietnam has made remarkable strides in its economic development, certain structural issues could hinder its capacity to scale up high-value manufacturing in the short to medium term. These include:

              Legal framework nuances

              Vietnam’s legal framework for foreign investment has seen continuous improvements, but legal and cultural complexities and inconsistencies can and do still arise. Navigating the regulatory landscape, particularly with new rules stemming from this agreement and at a time of deep administrative, governmental, digital and legal reforms in Vietnam, will demand expert legal guidance to ensure compliance and mitigate potential fines and disputes. Issues surrounding so-called sublicences for businesses, intellectual property rights enforcement and contract enforceability, whilst improving, still require careful consideration;

              Education

              The ambition to transform Vietnam into a high-value manufacturing hub necessitates a workforce equipped with advanced skills. While the Vietnamese government prioritises education and workforce development, a significant portion of the current labour force lacks formal training and specialised certifications, let alone a good command of the English language. Bridging this skills gap, particularly in areas like advanced manufacturing, engineering, and digital technologies is a necessity and not just in light of this framework agreement. Companies may need to factor in substantial investment in training and upskilling programmes for their Vietnamese employees.

              Infrastructures

              Despite considerable investment, Vietnam’s infrastructure, particularly in logistics, energy, and transportation, continues to face bottlenecks. And China – the apparent target of Trump’s tariffs – is stepping in with high-speed trains connecting it to the northern Provinces of Vietnam. An increased volume of high-value manufacturing and trade will place further strain on existing infrastructure. Inadequate port capacity, congested roads, and a reliable energy supply (including for EV charging) are critical concerns that could impact efficiency and increase operational costs for businesses.

              Policy divergence

              This framework agreement deepens US-Vietnam trade ties and seems to be paving the way for more US investments in Vietnam, but this second aspect seems to run counter to parallel US policy objectives aimed at reshoring manufacturing back to the United States. This potential divergence in strategic priorities could introduce yet another element of unpredictability in the long term, necessitating a flexible and adaptable investment approach. Future shifts in US policy could impact the durability and full extent of the benefits derived from this agreement.

              This trade agreement, if finalised and implemented, undoubtedly represents a structural shift in global trade dynamics. It strategically positions Vietnam as an increasingly important high-value manufacturing hub and significantly deepens US engagement in Southeast Asia. We will need time, however, to assess the practical impact of the agreement, observing the efficacy of its implementation, and understanding how Vietnam’s inherent strengths and challenges will ultimately shape its role in the reconfigured global supply chain.

              We will also need to see what China, if anything, will do as a countermeasure. In fact, any assessment of Vietnam’s evolving trade landscape would be incomplete without a thorough consideration of China’s influence and strategic posture. President Xi Jinping has consistently championed a vision of a “community of shared future for mankind,” a concept that, while outwardly promoting global cooperation, also subtly underscores a demand for international alignment with Beijing’s interests. In the context of escalating trade tensions, Xi has repeatedly warned that “trade wars have no winners,” advocating for unity against protectionist measures, yet simultaneously implying that nations must ultimately choose sides, either with or against China’s economic and political orbit. Vietnam, despite its historical complexities and occasional maritime disputes with Beijing in the South China Sea (or East Sea, as it is officially called by Hanoi), remains deeply interwoven with China’s economy. China has been Vietnam’s largest trading partner for many years, with significant inflows of Chinese FDI, loans, and project contractors. This economic dependency is particularly evident in various sectors, where Chinese components and materials form a substantial part of Vietnamese manufacturing supply chains. While Vietnam has actively sought to diversify its trade partners and reduce its reliance on China, the sheer scale of the bilateral economic relationship means that disentanglement is a long-term, complex endeavour. Furthermore, China’s influence extends beyond direct trade into crucial regional resources. The Mekong River, a lifeline for millions in Southeast Asia, originates in China, which has constructed numerous upstream dams.

              As Vietnam navigates its enhanced trade relationship with the United States, it must simultaneously contend with the enduring economic gravity and strategic ambitions of its northern giant neighbour. Any perceived move by Vietnam to significantly shift away from China could invite retaliatory measures or heightened pressure from Beijing. Businesses investing in Vietnam must not only grasp the intricacies of the US-Vietnam agreement but also meticulously analyse how these developments will intersect with, and potentially be impacted by, the intricate, often delicate, and sometimes fraught relationship between Hanoi and Beijing. Understanding this geopolitical tightrope will be essential for sustainable success in the Vietnamese market. Prudence, informed legal counsel, and a keen eye on evolving geopolitical and economic realities will be paramount for those seeking to capitalise on this transformative new chapter.

              Takeaways

              • Tariffs:The US-Vietnam framework agreement marks a significant departure from previous trade dynamics, reducing US tariffs on most Vietnamese imports to 20% (from a mooted 46%) while imposing a 40% tariff on transshipped goods, especially from China.
              • Vietnam’s market opening:Vietnam has committed to duty-free access for a broad range of US products and stricter controls on Chinese goods transiting its territory.
              • Growth / manufacturing shift potential:The agreement is expected to fuel expansion in Vietnamese electronics, textiles, furniture, energy (LNG), and agriculture. It also encourages supply chain localisation within Vietnam (normally more of an assembly point for Chinese products).
              • Execution challenges: Effectively preventing the re-routing of Chinese goods through Vietnam to avoid tariffs will be a complex and demanding task; Despite economic progress, Vietnam faces hurdles in scaling high-value manufacturing due to legal framework nuances (e.g., sublicences, IP enforcement), a skills gap in its workforce (lack of formal training, English proficiency) and infrastructure bottlenecks (logistics, energy, transportation).
              • US policy divergence:The agreement’s encouragement of US investment in Vietnam appears to contradict the broader US policy objective of reshoring manufacturing.
              • China:Businesses must consider China’s significant economic sway over Vietnam, including its position as Vietnam’s largest trading partner, its FDI, and its control over shared resources like the Mekong River. Any major shift by Vietnam away from China could lead to retaliatory measures from Beijing.
              • Uncertainty:This is not a final agreement, so the situation might change. Prudence and informed legal counsel are crucial for businesses navigating this evolving landscape.

              The Trump approach: power and dominance

              In his autobiography, The Art of the Deal, Donald Trump describes negotiation as a contest of strength, determination, and dominance. His vision is clear: anyone who shows uncertainty or makes concessions too early is immediately perceived as a loser. His negotiating style is based on constant pressure, maximalist demands, and calculated threats, to obtain unilateral advantages. In this scheme, compromise is not a point of arrival, but a sign of weakness to be avoided.

              Trump has always been a competitive negotiator, focused on immediate results and uninterested in balanced solutions unless they are strictly functional to his interests.

              Other negotiating styles: compromising and collaborative

              In contrast to this competitive approach, there are two other relevant negotiating styles:

              • The compromising style aims to reach a ‘middle ground’ agreement, in which both parties give something up to achieve an acceptable solution. It is a pragmatic approach, practical in situations where time is limited or positions are too far apart for genuine collaboration.
              • The collaborative style, on the other hand, aims to create win-win solutions. The parties seek to thoroughly understand each other’s interests and work together to build an outcome that maximizes the benefit for both. It requires openness, time, and trust.

              In commercial negotiations, the compromising or collaborative approach can only work if the other party shares the same logic. But when dealing with an explicitly competitive actor such as Trump, adopting a compromising style risks seriously penalizing the other party, for at least three reasons:

              • It conveys weakness

              An accommodating gesture is seen not as a sign of openness, but as a point of pressure to be exploited. The competitive negotiator, focused on gaining an immediate advantage, interprets it as a willingness to give even more.

              • It relinquishes bargaining power

              The EU has a vast market and significant trade levers, especially in a context where the US is closing the door to the Chinese market. Offering concessions at the outset is tantamount to burning your cards without getting anything in return. In a competitive confrontation, the first move can set the tone for the negotiation: once a concession has been made, it is very difficult to backtrack.

              • It legitimizes the negotiating imbalance

              An unbalanced compromise, if accepted without resistance, risks becoming the new basis for future trade relations, systematically penalizing the EU in subsequent rounds.

              Why 30%? The anchor technique

              Trump often uses a negotiating technique known as the anchor technique. This consists of deliberately setting a very high target at the beginning of the negotiation (in our case, the threat of 30% tariffs).

              The aim is to create a psychological perimeter for the negotiation and force the other party to reason on the basis of that figure, even though they are aware that it is arbitrary. This technique allows one to influence the scope of the discussion and obtain greater concessions, just as Trump has done.

              The worst response: unilateral concessions with no return

              Unfortunately, the European Union has already shown worrying signs of a compromising attitude that has not been negotiated with the Trump administration, for example:

              • The waiver of the web tax* on American digital giants, without obtaining any regulation or shared tax contribution in return.
              • The offer to increase imports of liquefied natural gas (LNG) from the US, made to reassure Washington, without obtaining anything in return.
              • The acceptance of the increase in NATO spending to 5% of GDP, demanded by Trump, again without obtaining anything in return.

              All these offers without asking for anything in return reinforce the idea that the EU is willing to concede from the outset. Trump, true to his competitive logic, sees these concessions as a starting point, not a compromise: this pushes him to raise his demands, not moderate them.

              Persevering would be a fatal mistake

              Continuing along this path of compromise, in the hope that accommodation will ease the pressure, would be not only ineffective but counterproductive. With a competitive negotiator, unilateral concessions do not stop escalation: they fuel it. Any sign of weakness is interpreted as additional room for maneuver.

              A helpful example is China’s reaction during the trade war initiated by Trump. Faced with massive tariffs imposed by the US, Beijing responded in kind, imposing equivalent tariffs. Instead of giving in, it spoke the same language of power. The result is there for all to see: after weeks of escalation, the US had to moderate its position, opening up to a more balanced agreement.

              The right strategy: speak his language

              To avoid the mistakes of the past, the EU should therefore reverse its negotiating logic. Not to fuel confrontation, but to restore a credible balance. Some applicable countermeasures could be:

              • Target Trump’s electoral base, particularly the agricultural sectors (soy, corn, beef), with selective tariffs or targeted restrictions.
              • Put the European web tax* back on the table, even with a minimum rate, linking any exemptions to real concessions from the US.

              These well-calibrated moves would strengthen the EU’s position and show that it can defend its interests by speaking a language Trump understands: that of strength and bargaining power.

              Going beyond requests, seeking the other party’s interests

              A fundamental principle in any negotiation is to identify the other side’s interests and find a way to allow them to achieve them without sacrificing your own. This is no easy task, given Trump’s notorious volatility and the lack of sound arguments to justify the demands made in the negotiations.

              In the case of the EU-US negotiations, it must be borne in mind that Trump is playing the game with his electoral base in mind: an agreement must offer him a narrative of victory to communicate to his electorate.

              Takeaway

              When negotiating with a competitive player like Trump, one should abandon the accommodating approach, avoid concessions without something in return, and adopt a style that is more assertive, strategic, and symmetrical.

              Only then will it be able to build an agreement that is solid, fair, and respectful of its economic and political strength.

              I have often dealt with commercial distribution agreements between Italian and Chinese companies, sometimes following negotiations in the wine sector for various types of agreements: sales, distribution, franchising, establishment of joint ventures, and sales through online stores.

              I am sharing some key considerations for approaching this complex but opportunity-rich market.

              📌 Here are my 10 takeaways

              Step Zero. Protect your IP

              it is essential to protect your intellectual property before entering China. This includes trademarks (including their Chinese transliteration), labels, web domains, and social media accounts. Neglecting this aspect can have disastrous consequences, exposing you to the widespread phenomenon of trademark squatting (even famous names such as Michael Jordan, Elon Musk, and Donald Trump have fallen victim to this).

              For more information, you can read this article about Intellectual property protection in China

              1 – Know your enemy

              trust is good, but mistrust is better. Before entering into commercial agreements, it is essential to check the credentials of potential partners through the databases of the State Administration for Industry and Commerce. When it comes to wine, it is necessary to check whether the prospective distributor has a license to import and distribute wine.

              2 – No copy-paste

               Contracts must be tailor-made, adapting them to local specificities. In particular, it is crucial to clearly regulate promotional activities: budget, commercial actions, communication methods, and management of the producer’s trademarks. It is also best to write the contract in Chinese to ensure that there are no misunderstandings and in case it needs to be used before a judge or local administrative body, as Chinese is the only official language. (N.B.: if you think of entrusting the task to ChatGPT, this is not a good idea).

              For an in-depth article, check out The commercial distribution contract in China

              3 – Decide immediately how and where to litigate

              It may seem counterintuitive, but it is best to avoid providing for Italian (or French, or German) jurisdiction and applicable law, which is an ineffective solution, especially in cases where urgent action is needed to stop unfair competition or counterfeiting. Consider applying Chinese law and provide for an arbitration clause at CIETAC. An effective dispute management strategy is a key element of the agreement and must be negotiated carefully. (P.S.: This applies not only to China but to all international agreements. For more information, see this article).

              4 – China is big

              And it is the sum of many very different internal markets. Exclusivity should be granted for good reasons, but only if the distributor has a well-developed commercial network and can achieve specific shared objectives. If granted, it should be limited to the province where the distributor is based and subject to the achievement of agreed sales volumes. Having a single distributor for the whole of China is like entrusting an Italian distributor with promoting a product throughout Europe. Or appoint a NYC-based company to promote and sell your wines in all 50 US States.

              5 – China is far away

              Delegating everything to the local distributor and taking no interest in what is happening on the Chinese market is never a good idea. Firstly, because you have no idea how, where, and with what results the wines are being sold. Secondly, because you cannot verify compliance with agreements, for example on non-competition or the use of trademarks. It is therefore important to schedule meetings to share commercial policies and be able to verify what is happening, including through audits and visits to warehouses and the sales network.

              6 – China is expensive

              Competition in the Chinese domestic market is fierce. This is also true in terms of price, as some countries that are direct competitors of Italy (Australia, Chile, New Zealand) have free trade agreements and can therefore enter the market on more favorable terms than Italian wine, which is subject to a total tax burden of around 43% after payment of duties, excise taxes, and VAT. It is necessary to position oneself in the right market segment (medium-high), and to do so, it is necessary to plan the right commercial actions together with the distributor. Selling Ex-Works and hoping that the distributor will take care of everything is not an excellent strategy for being competitive.

              7 – China is dangerous

              Scams are always around the corner. In the wine world in particular, for example, spontaneous expressions of interest are frequent, arriving via the company website, social media accounts, or directly via email. They sound like this: we have discovered your wines, we think they are fantastic, we want to place an order immediately. If it sounds too good and easy, it is certainly a scam. There is an easy way to check: if the next step is a request for payment of a few thousand euros, justified by the need to register the wines on the CIFER (China Imported Food Enterprise Registration) portal, or to register your trademark to prevent others from doing so, or to authenticate the signature on the sales contract… these are attempts at fraud, and the elusive order will never arrive after payment has been received. How can you check whether the person you are dealing with is a reputable company or a fraudster? 👉🏼Go back to point 1 (here is an in-depth article).

              8 – E-commerce? Yes, but with method (and money)

              Online wine sales continue to grow, but entering large platforms is complex, competition is fierce, and running an online store requires meticulous planning and highly efficient system implementation. The online market in China is all pay-for-play. Nothing is achieved with no money or minimal effort. If you want to sell online, you need to build an omnichannel system integrated with traditional distribution, and to do this, it is essential to involve a local partner with well-defined investments and responsibilities.

              9 – China is not a market for everyone

              You need to protect your brands, study the market thoroughly, know your competition (both foreign and local), find the right market channel, select a distributor motivated to invest time and money in promoting your product, and be willing to support them with the right investments. If you want to build a serious plan to enter the Chinese market, you must have a medium- to long-term perspective. There are no shortcuts (actually, there are many, but they almost always lead to wasted time and money). If you are unwilling to invest in entering the Chinese market through the front door, it is unlikely that anyone else will do it for you.

              10 – Don’t do it yourself

              If you have read up to point 9 and are still keen to enter the Chinese market, consider doing so professionally, involving consultants who can support your company throughout the market research, scouting, negotiation, and contract drafting processes. This is also part of the investment needed to build and develop a solid and resilient business model. This advice applies to all foreign markets, and even more so to China.

              The most dangerous mistake one can make after the announcement of the (partial) suspension of U.S. duties for 90 days is to hope that everything will go well and we will return to the pre-April 2 world.

              First, because very invasive tariffs remain in place: 10 percent on all countries that trade with the U.S., including the EU, 25 percent on automotive, 25 percent on steel and aluminum, 145 percent on China.

              Second, because it is impossible to predict the actions of the U.S. Administration in the short and medium term: it cannot be ruled out that tariffs will remain, increase, change targets or that other factors will intervene to turn the tide in international markets, such as an escalation of the trade war with China.

              The 90-day suspension is an opportunity

              The U.S.’s temporary suspension of tariffs represents a valuable window that should be used not only as a truce but also as a valuable room for action: 90 days to rehash contracts, renegotiate key clauses, and insert levers of flexibility that can protect business in various future scenarios in the U.S. and other markets.

              Today’s exporters cannot afford to „sit back and see what will happen“-it is time to act, and to do so professionally and strategically. Let’s look at a checklist of important points to consider.

              What do contracts with customers and suppliers entail?

              The first point is to survey agreements with the trade network in the U.S. and other countries that export to the U.S., as well as with upstream suppliers in the supply chain.

              Is there a written contract? The worst-case scenario – unfortunately a very frequent one – is when the parties cooperate informally, only based on orders and order confirmations. This leaves undefined not only what happens in the case of imposition of duties, but also a whole range of other points, for example, limits on damages that can be claimed in the case of breach of contract, the duration of the agreement, the applicable law, and how any disputes will be resolved.

              Another very problematic scenario is one in which contracts exist, but they are generic and do not include the necessary covenants to manage the risks involved in operating in a highly litigious market such as the U.S., which, moreover, has very high legal costs.

              Having done this analysis, the necessary actions can be put in place, prioritizing according to the importance of business relationships and as appropriate:

              • Negotiate and conclude a written contract from scratch
              • Replace the existing agreement with a complete and correct contract
              • Amend and integrate the existing agreement with pacts to manage tariffs and other causes of price fluctuations

              Let us dwell on the last scenario, assuming that there is a complete and correct contract but one that does not regulate price and cost fluctuation as a direct or indirect consequence of the introduction of duties.

              Contract Addendum

              In such cases, the correct course of action is to sign an Addendum to the original contract, specifying which covenants are being waived and which covenants are being added. It is essential that the Addendum be negotiated and signed by persons with the power of representation of the parties and that it be drafted with the help of lawyers who specialize in this field. In addition to including correct clauses, it is necessary to verify that the covenants are valid according to the rules of law applicable to the contract.

              Here are some clauses that can be the subject of the Addendum, to be modulated according to the specific case and possible scenarios.

              Tariff Cost Sharing

              By introducing this covenant, it is provided that in the event that duties are confirmed at [x]% or are reduced or increased within certain established thresholds, the Parties will share the increase equally, or according to other established percentages.

              There may also be a ceiling on tariffs beyond which a party has the right to withdraw from the contract or request the suspension of certain orders for a specified period of time, after which it has the right to withdraw.

              Price Adjustment

              With this covenant, a discount or an increase in the product’s price is agreed upon, as the case may be, in the case of a duty greater than [x]%.

              Among the use cases, in addition to that of the company exporting to the U.S. or other intermediate markets, with final destination of the products in the U.S., is that of those who purchase a product subject to import duty and resell it, processed or assembled.

              Right to Cancel or Postpone Confirmed Orders

              This covenant gives the right to revoke or suspend for a certain period already negotiated orders, as such binding, in case of confirmation or introduction of duties above a certain threshold, for example, if 20% taxation was confirmed for the import of wine from the EU.

              The clause can be combined with previous covenants, for example, by stipulating that below the specified threshold, the contracts remain valid, and the parties share the duty or have the right to renegotiate the price.

              Supply Forecast Adjustment

              With this clause the Parties can modify supply programs already agreed for a specific duration (e.g., 24 months), with continuous sales and purchase obligations at a fixed price or indexable only within certain limits. The aim is to agree on the prerequisites for reshaping supply programs in the short and medium term, which can be very useful for defining the rules that will apply to relationships with key suppliers or customers for possible changes in volumes, delivery times, and prices.

              Right to Source from Alternative Suppliers

              This covenant serves to be authorized, if necessary, to source alternative suppliers of components or raw materials to those previously authorized in the contract with the end customer, for example, in cases where purchasing from the original suppliers has become too costly or difficult due to duties imposed at import or in previous steps in the supply chain, or other events such as currency or price fluctuation of certain commodities beyond a certain level established in the agreement.

              Hardship and Force Majeure

              The imposition of duties cannot be invoked as a cause of Force Majeure or hardship, respectively, to excuse contract non-performance or to renegotiate the price, even in cases of very high price increases (such as the 145% duty imposed on Chinese products). This conclusion is almost uniform under the law and jurisprudence of the major countries involved in the tariff war: U.S., China, Canada, Mexico, France and Italy: I refer to this practical guide for a timely examination of what the various rules provide.

              If the contract lacks a well drafter Force Majeure and Hardship clause, or contains a generic clause, it is important to get your hands on revising it to expressly state the cases in which a party is entitled to suspend or terminate the contract, how and when to communicate the decision to invoke the exemption, and the consequences on the parties‘ contractual obligations. You can go deeper on this topic here.

              Conclusion

              It is essential to prepare for possible future scenarios regarding duties (confirmed, increased, changed, or decreased) and to determine the consequences on trade relations with foreign clients and suppliers: moving today, at a standstill (or nearly so), allows entrepreneurs to negotiate shared and fair solutions and to avoid, as far as possible, the emergence of tensions and conflicts with the various partners along the international supply chain.

              Roberto Luzi Crivellini

              Rechtsgebiete

              • Schiedsgerichtsbarkeit
              • Vertrieb
              • Internationaler Handel
              • Rechtsstreitigkeiten
              • Immobilien
              Kontakt Roberto

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                11. April 2025

                • Vertrieb

                It is quite common for business relationships with agents or distributors to last for years without any signed documents. And be careful, because we know that a contract can exist even verbally.

                The absence of a written contract will add difficulties in the event of a possible claim, so what you do between the decision to terminate, and the moment of the claim is very important. Remember: ‘anything you write will be used against you’.

                The decision to terminate a business relationship is a very delicate moment to which, for some reason, solicitors are not invited. Here are some examples (all real) in which companies or employees with the best of intentions wrote to the agent/distributor. All of them were subsequently very damaging to the company:

                Saying ‘We are terminating our business relationship’ when the strategy will be to argue that no such business relationship exists, but rather that there are separate and linked contracts (e.g., supply rather than ongoing distribution contract; very significant compensation consequences).

                ‘You no longer represent our company’, which may be evidence that you did so before.

                ‘As of day X, you may no longer act on behalf of our company,’ which would prove that you were previously able to act on its behalf.

                ‘You may not attend the X trade fair on our behalf.’ A way of confirming that the agent/distributor’s responsibilities included participating in trade fairs and probably accrediting the customers obtained.

                ‘The sales you promoted have been significantly reduced in year N.’ When there is no written contract or other form of documentation, imputing a breach of an obligation that is not clear can be counterproductive.

                Saying ‘You are not actively promoting our products’ and then adding: ‘We urge you to stop promoting the sale of our products’.

                ‘You are no longer our exclusive representative’, which proves a type of relationship (representation/agent) and a tacit or express agreement (‘exclusivity’).

                ‘We have appointed another representative in your area’, which shows that the agent/distributor had an assigned area and was “representing”.

                ‘From this moment on, orders will be handled by X’, which also confirms a type of relationship.

                 

                In summary: from the moment the company considers terminating a commercial relationship, especially when it is not in writing and before sending any letter, it is advisable to think carefully about the strategy in case of a possible claim. This is the best time to seek advice and avoid surprises. Any communication that is not in line with this strategy designed from the outset can only lead to confusion and problems.

                Remember the USA – EU agreement on 15% tariffs? I wrote that with a negotiator like Trump the game is never over (article here) and—after the recent interlude featuring a threat of 100% tariffs on pharmaceuticals—the U.S. government has announced the imposition of an overall 107% duty on Italian pasta, which could take effect on January 1, 2026.

                Where this new duty comes from

                The antidumping investigation was launched by the U.S. Department of Commerce at the request of certain competing American companies and is based on a 1996 antidumping order that allows for periodic reviews of imports of Italian pasta. The Department of Commerce conducts these checks annually to assess whether Italian producers are selling pasta at prices lower than the U.S. domestic market, a practice known as “dumping.”

                Companies involved in the investigation

                The Department of Commerce selected two sample companies for in-depth analysis, defined as “mandatory respondents”: La Molisana and Pastificio Lucio Garofalo. According to the official document published by the U.S. administration, for the period from July 1, 2023 to June 30, 2024, both companies allegedly sold their products below market prices, resulting in the imposition of a duty of 91.74%.

                U.S. authorities justified this percentage by claiming the two companies did not provide complete or compliant information as requested by the Department and were therefore insufficiently cooperative during the investigation. What is very important is that, in addition to the two companies directly examined, the additional 91.74% duty is also applied to numerous other Italian producers not individually reviewed. This methodology, while formally permitted under U.S. law as an exception, is being applied without any direct verification of the other companies.

                Next steps in the procedure

                Italy’s Ministry of Foreign Affairs moved immediately, formally intervening in the proceeding as an “interested party” through the Italian Embassy in Washington. The Foreign Ministry is working in close coordination with the companies concerned and, in concert with the European Commission, to persuade the U.S. Department to revise the provisional duties.

                The two companies involved (La Molisana and Garofalo) can submit documentation to contest the dumping allegations. However, if dumping is confirmed, the Department of Commerce will instruct Customs to apply antidumping duties on goods sold and entered into U.S. commerce.

                The preliminary nature of this determination means there is still room to change the decision before it becomes final.

                Possible effective date

                The new super-duty of 91.74%, which will be added to the existing 15% tariff for a total of 107%, is scheduled to take effect on January 1, 2026. This date therefore represents a crucial deadline for all ongoing diplomatic and legal actions.

                If confirmed, the economic impact would be significant: in 2024, Italian pasta exports to the United States reached a value of €671 million according to Coldiretti, accounting for nearly 17% of the sector’s total exports. A 107% duty would risk seriously undermining competitiveness in one of the most important markets for Italian agri-food products.

                 What to do between now and January 1, 2026?

                At this stage, the entry into force of the new duty depends on the outcome of the ongoing procedure: given what has happened in recent months, and the political use the U.S. administration has made of tariffs—well beyond their technical function—it is reasonable to be pessimistic.

                So, what to do? In recent months we have seen companies react to the uncertainty over the fate of the tariffs in three ways:

                • Some rushed to ship as many products as possible before the potential effective date of the duty;
                • Some granted—upfront—discounts equivalent to the threatened duty, in case it came into force;
                • Some suspended orders, pending definitive news on the impact of the duties.

                These are all  valid options, but other effective tools for managing the uncertainty caused by the flurry of announcements, negotiations, and threats from the U.S. administration should not be forgotten: the risk of new duties being introduced, or existing ones being increased, can be managed in the contract by agreeing with the U.S. importer how any tariff change will affect the product.

                The parties can stipulate, for example, that the increase will be split equally; or that the importer will bear it beyond a certain threshold; or that if the duty exceeds a certain level, the contracts may be terminated. You can find a deeper dive in this article.

                The only certainty is that trade relations with the U.S. will stay unpredictable for a long time, and it’s vital to carefully manage the risk factors involved in selling products there. Right now, the focus is on tariffs and prices, and I encourage you to take this chance to thoroughly review existing agreements and assess whether—and how—other important points are addressed that could entail significant liabilities: we discuss them, very practically, in this book.

                On 29 June 2025, the Vietnamese government introduced Decree No. 163/2025/ND-CP (Decree 163). This decree provides detailed guidance on how the updated Law on Pharmacy will be implemented.

                Like the amended Law on Pharmacy, Decree 163 came into effect on 1 July 2025, replacing the previous Decree No. 54/2017/ND-CP (Decree 54). The new decree sets out comprehensive rules for key aspects of managing pharmaceuticals, including:

                • Pharmacy practice certificates
                • Certificates allowing pharmaceutical businesses to operate
                • Import and export of medicines and drug ingredients
                • Good Manufacturing Practice (GMP) inspections of overseas manufacturers
                • Recalling medicines and drug ingredients
                • Certificates for medicine advertising content
                • Medicine price management

                Key Changes in Decree 163

                Here are some important changes and additions introduced by Decree 163:

                Destroying Specially Controlled Medicines

                You no longer need to get approval from the relevant authority before destroying narcotic, psychotropic, and precursor drugs, or pharmaceutical ingredients that are narcotic or psychotropic substances or precursors used in medicines. Instead, you just need to provide notification at least seven working days in advance. This notification must include the planned destruction date and a detailed list of items to be destroyed.

                E-commerce in Pharmaceutical

                Pharmaceutical businesses that sell products online must openly display the following information to ensure transparency and consumer safety:

                • Their certificate allowing them to operate as a pharmaceutical business.
                • The pharmacy practice certificate of the person responsible for pharmaceutical expertise.
                • Information about the medicines themselves.

                Shelf-Life Rules for Imported Products

                For medicines and ingredients with a total shelf life of nine months or less, at least one-third of their shelf life must remain when they clear customs. Medicines with a shelf life of 30 days or less must still be within their shelf life at the time of customs clearance.

                Controlling Imported Products

                All medicines with marketing authorisation (MA) are subject to import control, except for:

                • Medicines needed for preventing and treating Group A infectious diseases that have been declared epidemics, as per the Law on Prevention and Control of Infectious Diseases.
                • Medicines with a shelf life of less than 30 days.

                Importers must inform the provincial People’s Committee at least five working days before making a customs declaration. The People’s Committee can then issue a written notice of non-compliance to the customs authority within five working days of receiving this notification.

                Medicine Advertising

                Decree 163 adds a process that allows an approved medicine advertising certificate to be adjusted for certain changes (such as a change to the MA holder or manufacturer information). This means you don’t have to go through the entire initial registration process for medicine advertising content again, as was required under the previous rules.

                Medicine Price Management

                Businesses must announce or re-announce wholesale prices, similar to the medicine price declaration process under Decree 54. Some medicines are exempt from this requirement, including those provided free of charge for emergency responses, national health programmes, humanitarian aid, clinical trials, scientific research, or exhibition purposes, and medicines carried as personal luggage.

                The Ministry of Health (MOH) can make recommendations if the announced or re-announced price is significantly higher than similar medicines already on the market. This includes situations where:

                • The announced or re-announced wholesale price of the medicine is higher than the highest price of similar medicines.
                • The price difference is more than 35% (for medicines priced under VND 1 million) or 15% (for medicines priced at VND 1 million and above) compared to winning bid prices in tenders.
                • The announced or re-announced price is higher than prices in the country of origin or other markets (if there’s no similar product in Vietnam).
                • When such differences are found, the MOH issues a formal recommendation to the announcing business and publishes it online for transparency and accountability.

                Further Guidance in New Circular

                On 1 July 2025, the MOH issued Circular No. 31/2025/TT-BYT (Circular 31), which further details how the amended Law on Pharmacy and Decree 163 should be implemented. Circular 31 officially replaces Circular No. 07/2018/TT-BYT and Decree 54 and came into effect immediately.

                Key provisions of Circular 31 include:

                Notification of Practising Pharmacists

                Pharmaceutical businesses that are not part of a pharmacy chain must inform the relevant authority of a list of people currently working at the business who hold pharmacy practice certificates. This notification must be submitted within 15 days of the date the certificate allowing the pharmaceutical business to operate was issued, or when there are any changes to the list. This is a shorter deadline than the previous 30 days under earlier rules.

                Pharmacy chains have similar notification duties and deadlines. Specifically, the chain operator must inform the provincial authority where each pharmacy in the chain is located about the list of practising pharmacists at those sites. Additionally, pharmacy chains must notify the authority if pharmacies are added or removed from the chain, and if there are any rotations of the people responsible for pharmaceutical expertise between pharmacies within the chain.

                Medicine Information Activities

                Under Circular 31, medicine information can still be given to healthcare professionals through information materials, seminars, and medical representatives.

                However, Circular 31 introduces a significant change by removing the need to obtain a certificate for medicine information content before carrying out these activities. Under the new rules, pharmaceutical businesses, representative offices of foreign pharmaceutical companies in Vietnam, and MA holders are now responsible for creating and distributing medicine information materials. These materials must comply with the package inserts for medicines approved by the MOH, the Vietnamese National Drug Formulary, and any related documents and professional instructions issued or recognised by the MOH.

                Donald Trump, never one to shy away from drama or diplomacy-via-caps-lock, has slapped a 50% tariff on all Brazilian exports to the United States. The justification? In his own delicate prose: „The treatment of former President Jair Bolsonaro is a disgrace… A witch hunt that must end IMMEDIATELY!“

                And just in case anyone thought this was about trade imbalances or economic strategy, Trump made things crystal clear: „Due to Brazil’s insidious attacks on free elections…“.

                In short, the 50% tariff isn’t about coffee, orange juice, or flip-flops. It’s about a Supreme Court judgment, applying Brazilian law, regarding Brazilian politicians accused of conspiring in a coup d’état. In other words, this is a brazen (and frankly absurd) attempt at judicial intervention via trade war.

                Trump, with his characteristic subtlety, offered a solution: manufacture in the U.S., and he’ll look kindly upon Brazil, like a mafia don offering „protection“ after smashing your shop window. But what he meant was: consider Bolsonaro innocent, and we’ll talk.

                The Brazilian market took the bait

                Although the fishy interference in Brazilian affairs was determined from a fish out of the water, the market took the bait: in the first 48 hours after the infamous letter, at least 1500 tons of fish were already held in Brazilian ports, as US buyers suspended their contracts due to uncertainty about the costs upon arrival. The fish market is on alert, as 80% of the exports head to the US, mainly coming from small family-owned industries that distribute the catch from artisanal fishing communities.

                The same effect hit other sectors, from orange, honey, and coffee to aircraft.

                Brazil’s response and sorcery: don’t mess with us (or our weather)

                Naturally, Brazil will not sit quietly sipping caipirinhas while its sovereignty is trampled. Reciprocity is on the table: if Washington raises tariffs, Brasília can do the same. But above all, one thing is sure: Brazil will never tolerate foreign interference in its independent judiciary.

                And then, a curious coincidence: right after Trump’s speech, a tornado accompanied by lightning struck the White House grounds. Pure chance? Maybe. Or could it have been the work of Brazilian indigenous shamans, a particularly well-organized group of umbanda practitioners, or simply the fact that, as every Brazilian child knows, God is Brazilian.

                Trump might want to check the weather forecast next time before penning another angry letter.

                The unpredictable becoming predictable

                Trade wars are rarely tidy affairs, but one thing they consistently deliver is chaos (in legal terms, disruption). And when disruption meets contracts, force majeure disputes often end up in court.

                At first glance, Trump’s decision to impose a 50% tariff overnight might feel like an unpredictable thunderbolt (quite literally, given the weather at the White House). But here’s the catch: by now, unpredictable tariffs are becoming predictable. When a government with a well-documented love for impulsive economic diplomacy imposes politically motivated tariffs, can anyone claim to be surprised?

                In most jurisdictions, force majeure requires that the event be extraordinary, unforeseeable, and beyond the parties’ control. A sudden 50% tariff certainly ticks a few of those boxes, but following a repetition of erratic trade policy, one might argue that businesses should expect what in past times was considered unexpected, especially when dealing with certain jurisdictions or political figures. In other words, Trump’s tariffs might not excuse performance if parties didn’t prepare for exactly this kind of volatility.

                This is where good contract drafting comes into play

                Savvy businesses are learning that their contracts must go beyond a vague boilerplate clause about “acts of government” or “changes in law.” Instead, they should expressly address the risk of sudden tariff changes, including

                • hardship clauses that allow renegotiation when costs become commercially unreasonable;
                • price adjustment mechanisms linked to tariff thresholds;
                • termination rights triggered by specified levels of customs duties;
                • currency fluctuation provisions (because tariffs rarely travel alone, and currency swings often accompany them).

                In short, while no contract can immunize a business from every shock, smart drafting can mean the difference between a commercial headache and a catastrophic breach.

                Therefore, tariffs may no longer be an unpredictable storm; they are part of the new predictable landscape. Given that your contract might wake up tomorrow facing ‘IMMEDIATE’ punitive tariffs in all caps, your contract should be ready today.

                The unwitting cupid: strengthening EU-Brazil relations

                While the tariffs may ruffle trade flows between Brasília and Washington, there’s an unintended silver lining: Trump is proving to be the most efficient matchmaker between Brazil and other markets, such as China and the European Union.

                The EU-Brazil relationship, already a flirtation with promising prospects, with relevant progress in the EU-Mercosur Agreement, now seems destined for deeper romance. If Mr. Trump insists on isolating the US from Brazil, the old continent stands ready, with flowers and wine in hand, to pick up where the US left off. After all, Brazilian fish can pair up nicely with champagne, cava and prosecco.

                So thank you, Mr. Trump. In your quest to bully Brazil into submission, you may have done more to strengthen transatlantic ties than any EU Commissioner ever could. As they say in Brasília these days: Trump is not a trade warrior. He’s a cupid in disguise.

                The recent announcement of a landmark trade agreement framework, following just three months negotiations since President Trump’s tariffs announcement on 2 April 2025, signals a pivotal shift, not merely in bilateral relations, but in the broader architecture of global supply chains.

                As a commercial lawyer with exposure to Vietnam since 2007, I have observed the evolving dynamics between the United States and Vietnam through the years, talking to students, entrepreneurs, veterans, diplomats, humans from all walks all life, from both nations and beyond.

                You may recall that Vietnam, with the notable exclusion of China, was to be the nation that would encounter the most stringent tariffs imposed by the Trump administration, reaching an astonishing 46%.

                The newly forged framework outlines significant reciprocal concessions designed to foster greater trade and investment flows. Granted, pre-April 2 tariffs applied by the USA on Vietnamese goods were lower than what emerges from the framework agreement, but still, it is better than 46%),

                The United States has committed to imposing a 20% tariff on most Vietnamese imports, a notable reduction from the previously mooted 46%. However, a substantial 40% tariff will apply to goods re-exported from third countries, with a particular focus on those originating from China.

                Vietnam has pledged to open its market to a wide array of US products. Crucially, it has also committed to implementing stringent measures aimed at restricting the transshipment of Chinese goods through its territory, a long-standing concern for Washington.

                In a significant win for American exporters, US goods will now enjoy duty-free access to the Vietnamese market, effectively granting “total access”, particularly for large-engine vehicles such as SUVs, as emphatically stated by President Trump (how SUVs are going to circulate in the narrow alleys of Hanoi and Ho Chi Minh City, infested by swarms of mopeds, is a different story).

                This agreement is expected to catalyse growth in several key sectors. Electronics, textiles, furniture, energy (especially Liquefied Natural Gas), and agriculture are poised for expansion. US firms specialising in manufacturing technology, energy solutions, and agricultural products are anticipated to be the primary beneficiaries. Furthermore, beyond immediate trade benefits, the agreement is set to reshape investment strategies, encouraging a greater localisation of supply chains within Vietnam. This strategic realignment is also expected to further solidify the already robust US-Vietnam Comprehensive Strategic Partnership.

                While the potential upsides are considerable, it is imperative for businesses and investors to approach this new landscape with a clear understanding of the accompanying risks. From my vantage point, I identify several significant execution challenges and structural impediments that require close monitoring.

                Enforcement of Transshipment Controls

                The most immediate and perhaps formidable risk lies in the effective enforcement of transshipment controls. Vietnam has historically served as a significant assembly point for Chinese-manufactured components. Ensuring that goods originating from China are not merely re-routed through Vietnam to circumvent US tariffs will require exceptionally close monitoring and robust verification mechanisms. The legal and practical complexities of definitively determining the true country of origin for all goods will undoubtedly pose a persistent challenge. As a European citizen, witnessing how the EU-Vietnam Free Trade Agreement (“EVFTA”), which poses an important stress on certificates of origin, I am particularly aware of this matter.

                While Vietnam has made remarkable strides in its economic development, certain structural issues could hinder its capacity to scale up high-value manufacturing in the short to medium term. These include:

                Legal framework nuances

                Vietnam’s legal framework for foreign investment has seen continuous improvements, but legal and cultural complexities and inconsistencies can and do still arise. Navigating the regulatory landscape, particularly with new rules stemming from this agreement and at a time of deep administrative, governmental, digital and legal reforms in Vietnam, will demand expert legal guidance to ensure compliance and mitigate potential fines and disputes. Issues surrounding so-called sublicences for businesses, intellectual property rights enforcement and contract enforceability, whilst improving, still require careful consideration;

                Education

                The ambition to transform Vietnam into a high-value manufacturing hub necessitates a workforce equipped with advanced skills. While the Vietnamese government prioritises education and workforce development, a significant portion of the current labour force lacks formal training and specialised certifications, let alone a good command of the English language. Bridging this skills gap, particularly in areas like advanced manufacturing, engineering, and digital technologies is a necessity and not just in light of this framework agreement. Companies may need to factor in substantial investment in training and upskilling programmes for their Vietnamese employees.

                Infrastructures

                Despite considerable investment, Vietnam’s infrastructure, particularly in logistics, energy, and transportation, continues to face bottlenecks. And China – the apparent target of Trump’s tariffs – is stepping in with high-speed trains connecting it to the northern Provinces of Vietnam. An increased volume of high-value manufacturing and trade will place further strain on existing infrastructure. Inadequate port capacity, congested roads, and a reliable energy supply (including for EV charging) are critical concerns that could impact efficiency and increase operational costs for businesses.

                Policy divergence

                This framework agreement deepens US-Vietnam trade ties and seems to be paving the way for more US investments in Vietnam, but this second aspect seems to run counter to parallel US policy objectives aimed at reshoring manufacturing back to the United States. This potential divergence in strategic priorities could introduce yet another element of unpredictability in the long term, necessitating a flexible and adaptable investment approach. Future shifts in US policy could impact the durability and full extent of the benefits derived from this agreement.

                This trade agreement, if finalised and implemented, undoubtedly represents a structural shift in global trade dynamics. It strategically positions Vietnam as an increasingly important high-value manufacturing hub and significantly deepens US engagement in Southeast Asia. We will need time, however, to assess the practical impact of the agreement, observing the efficacy of its implementation, and understanding how Vietnam’s inherent strengths and challenges will ultimately shape its role in the reconfigured global supply chain.

                We will also need to see what China, if anything, will do as a countermeasure. In fact, any assessment of Vietnam’s evolving trade landscape would be incomplete without a thorough consideration of China’s influence and strategic posture. President Xi Jinping has consistently championed a vision of a “community of shared future for mankind,” a concept that, while outwardly promoting global cooperation, also subtly underscores a demand for international alignment with Beijing’s interests. In the context of escalating trade tensions, Xi has repeatedly warned that “trade wars have no winners,” advocating for unity against protectionist measures, yet simultaneously implying that nations must ultimately choose sides, either with or against China’s economic and political orbit. Vietnam, despite its historical complexities and occasional maritime disputes with Beijing in the South China Sea (or East Sea, as it is officially called by Hanoi), remains deeply interwoven with China’s economy. China has been Vietnam’s largest trading partner for many years, with significant inflows of Chinese FDI, loans, and project contractors. This economic dependency is particularly evident in various sectors, where Chinese components and materials form a substantial part of Vietnamese manufacturing supply chains. While Vietnam has actively sought to diversify its trade partners and reduce its reliance on China, the sheer scale of the bilateral economic relationship means that disentanglement is a long-term, complex endeavour. Furthermore, China’s influence extends beyond direct trade into crucial regional resources. The Mekong River, a lifeline for millions in Southeast Asia, originates in China, which has constructed numerous upstream dams.

                As Vietnam navigates its enhanced trade relationship with the United States, it must simultaneously contend with the enduring economic gravity and strategic ambitions of its northern giant neighbour. Any perceived move by Vietnam to significantly shift away from China could invite retaliatory measures or heightened pressure from Beijing. Businesses investing in Vietnam must not only grasp the intricacies of the US-Vietnam agreement but also meticulously analyse how these developments will intersect with, and potentially be impacted by, the intricate, often delicate, and sometimes fraught relationship between Hanoi and Beijing. Understanding this geopolitical tightrope will be essential for sustainable success in the Vietnamese market. Prudence, informed legal counsel, and a keen eye on evolving geopolitical and economic realities will be paramount for those seeking to capitalise on this transformative new chapter.

                Takeaways

                • Tariffs:The US-Vietnam framework agreement marks a significant departure from previous trade dynamics, reducing US tariffs on most Vietnamese imports to 20% (from a mooted 46%) while imposing a 40% tariff on transshipped goods, especially from China.
                • Vietnam’s market opening:Vietnam has committed to duty-free access for a broad range of US products and stricter controls on Chinese goods transiting its territory.
                • Growth / manufacturing shift potential:The agreement is expected to fuel expansion in Vietnamese electronics, textiles, furniture, energy (LNG), and agriculture. It also encourages supply chain localisation within Vietnam (normally more of an assembly point for Chinese products).
                • Execution challenges: Effectively preventing the re-routing of Chinese goods through Vietnam to avoid tariffs will be a complex and demanding task; Despite economic progress, Vietnam faces hurdles in scaling high-value manufacturing due to legal framework nuances (e.g., sublicences, IP enforcement), a skills gap in its workforce (lack of formal training, English proficiency) and infrastructure bottlenecks (logistics, energy, transportation).
                • US policy divergence:The agreement’s encouragement of US investment in Vietnam appears to contradict the broader US policy objective of reshoring manufacturing.
                • China:Businesses must consider China’s significant economic sway over Vietnam, including its position as Vietnam’s largest trading partner, its FDI, and its control over shared resources like the Mekong River. Any major shift by Vietnam away from China could lead to retaliatory measures from Beijing.
                • Uncertainty:This is not a final agreement, so the situation might change. Prudence and informed legal counsel are crucial for businesses navigating this evolving landscape.

                The Trump approach: power and dominance

                In his autobiography, The Art of the Deal, Donald Trump describes negotiation as a contest of strength, determination, and dominance. His vision is clear: anyone who shows uncertainty or makes concessions too early is immediately perceived as a loser. His negotiating style is based on constant pressure, maximalist demands, and calculated threats, to obtain unilateral advantages. In this scheme, compromise is not a point of arrival, but a sign of weakness to be avoided.

                Trump has always been a competitive negotiator, focused on immediate results and uninterested in balanced solutions unless they are strictly functional to his interests.

                Other negotiating styles: compromising and collaborative

                In contrast to this competitive approach, there are two other relevant negotiating styles:

                • The compromising style aims to reach a ‘middle ground’ agreement, in which both parties give something up to achieve an acceptable solution. It is a pragmatic approach, practical in situations where time is limited or positions are too far apart for genuine collaboration.
                • The collaborative style, on the other hand, aims to create win-win solutions. The parties seek to thoroughly understand each other’s interests and work together to build an outcome that maximizes the benefit for both. It requires openness, time, and trust.

                In commercial negotiations, the compromising or collaborative approach can only work if the other party shares the same logic. But when dealing with an explicitly competitive actor such as Trump, adopting a compromising style risks seriously penalizing the other party, for at least three reasons:

                • It conveys weakness

                An accommodating gesture is seen not as a sign of openness, but as a point of pressure to be exploited. The competitive negotiator, focused on gaining an immediate advantage, interprets it as a willingness to give even more.

                • It relinquishes bargaining power

                The EU has a vast market and significant trade levers, especially in a context where the US is closing the door to the Chinese market. Offering concessions at the outset is tantamount to burning your cards without getting anything in return. In a competitive confrontation, the first move can set the tone for the negotiation: once a concession has been made, it is very difficult to backtrack.

                • It legitimizes the negotiating imbalance

                An unbalanced compromise, if accepted without resistance, risks becoming the new basis for future trade relations, systematically penalizing the EU in subsequent rounds.

                Why 30%? The anchor technique

                Trump often uses a negotiating technique known as the anchor technique. This consists of deliberately setting a very high target at the beginning of the negotiation (in our case, the threat of 30% tariffs).

                The aim is to create a psychological perimeter for the negotiation and force the other party to reason on the basis of that figure, even though they are aware that it is arbitrary. This technique allows one to influence the scope of the discussion and obtain greater concessions, just as Trump has done.

                The worst response: unilateral concessions with no return

                Unfortunately, the European Union has already shown worrying signs of a compromising attitude that has not been negotiated with the Trump administration, for example:

                • The waiver of the web tax* on American digital giants, without obtaining any regulation or shared tax contribution in return.
                • The offer to increase imports of liquefied natural gas (LNG) from the US, made to reassure Washington, without obtaining anything in return.
                • The acceptance of the increase in NATO spending to 5% of GDP, demanded by Trump, again without obtaining anything in return.

                All these offers without asking for anything in return reinforce the idea that the EU is willing to concede from the outset. Trump, true to his competitive logic, sees these concessions as a starting point, not a compromise: this pushes him to raise his demands, not moderate them.

                Persevering would be a fatal mistake

                Continuing along this path of compromise, in the hope that accommodation will ease the pressure, would be not only ineffective but counterproductive. With a competitive negotiator, unilateral concessions do not stop escalation: they fuel it. Any sign of weakness is interpreted as additional room for maneuver.

                A helpful example is China’s reaction during the trade war initiated by Trump. Faced with massive tariffs imposed by the US, Beijing responded in kind, imposing equivalent tariffs. Instead of giving in, it spoke the same language of power. The result is there for all to see: after weeks of escalation, the US had to moderate its position, opening up to a more balanced agreement.

                The right strategy: speak his language

                To avoid the mistakes of the past, the EU should therefore reverse its negotiating logic. Not to fuel confrontation, but to restore a credible balance. Some applicable countermeasures could be:

                • Target Trump’s electoral base, particularly the agricultural sectors (soy, corn, beef), with selective tariffs or targeted restrictions.
                • Put the European web tax* back on the table, even with a minimum rate, linking any exemptions to real concessions from the US.

                These well-calibrated moves would strengthen the EU’s position and show that it can defend its interests by speaking a language Trump understands: that of strength and bargaining power.

                Going beyond requests, seeking the other party’s interests

                A fundamental principle in any negotiation is to identify the other side’s interests and find a way to allow them to achieve them without sacrificing your own. This is no easy task, given Trump’s notorious volatility and the lack of sound arguments to justify the demands made in the negotiations.

                In the case of the EU-US negotiations, it must be borne in mind that Trump is playing the game with his electoral base in mind: an agreement must offer him a narrative of victory to communicate to his electorate.

                Takeaway

                When negotiating with a competitive player like Trump, one should abandon the accommodating approach, avoid concessions without something in return, and adopt a style that is more assertive, strategic, and symmetrical.

                Only then will it be able to build an agreement that is solid, fair, and respectful of its economic and political strength.

                I have often dealt with commercial distribution agreements between Italian and Chinese companies, sometimes following negotiations in the wine sector for various types of agreements: sales, distribution, franchising, establishment of joint ventures, and sales through online stores.

                I am sharing some key considerations for approaching this complex but opportunity-rich market.

                📌 Here are my 10 takeaways

                Step Zero. Protect your IP

                it is essential to protect your intellectual property before entering China. This includes trademarks (including their Chinese transliteration), labels, web domains, and social media accounts. Neglecting this aspect can have disastrous consequences, exposing you to the widespread phenomenon of trademark squatting (even famous names such as Michael Jordan, Elon Musk, and Donald Trump have fallen victim to this).

                For more information, you can read this article about Intellectual property protection in China

                1 – Know your enemy

                trust is good, but mistrust is better. Before entering into commercial agreements, it is essential to check the credentials of potential partners through the databases of the State Administration for Industry and Commerce. When it comes to wine, it is necessary to check whether the prospective distributor has a license to import and distribute wine.

                2 – No copy-paste

                 Contracts must be tailor-made, adapting them to local specificities. In particular, it is crucial to clearly regulate promotional activities: budget, commercial actions, communication methods, and management of the producer’s trademarks. It is also best to write the contract in Chinese to ensure that there are no misunderstandings and in case it needs to be used before a judge or local administrative body, as Chinese is the only official language. (N.B.: if you think of entrusting the task to ChatGPT, this is not a good idea).

                For an in-depth article, check out The commercial distribution contract in China

                3 – Decide immediately how and where to litigate

                It may seem counterintuitive, but it is best to avoid providing for Italian (or French, or German) jurisdiction and applicable law, which is an ineffective solution, especially in cases where urgent action is needed to stop unfair competition or counterfeiting. Consider applying Chinese law and provide for an arbitration clause at CIETAC. An effective dispute management strategy is a key element of the agreement and must be negotiated carefully. (P.S.: This applies not only to China but to all international agreements. For more information, see this article).

                4 – China is big

                And it is the sum of many very different internal markets. Exclusivity should be granted for good reasons, but only if the distributor has a well-developed commercial network and can achieve specific shared objectives. If granted, it should be limited to the province where the distributor is based and subject to the achievement of agreed sales volumes. Having a single distributor for the whole of China is like entrusting an Italian distributor with promoting a product throughout Europe. Or appoint a NYC-based company to promote and sell your wines in all 50 US States.

                5 – China is far away

                Delegating everything to the local distributor and taking no interest in what is happening on the Chinese market is never a good idea. Firstly, because you have no idea how, where, and with what results the wines are being sold. Secondly, because you cannot verify compliance with agreements, for example on non-competition or the use of trademarks. It is therefore important to schedule meetings to share commercial policies and be able to verify what is happening, including through audits and visits to warehouses and the sales network.

                6 – China is expensive

                Competition in the Chinese domestic market is fierce. This is also true in terms of price, as some countries that are direct competitors of Italy (Australia, Chile, New Zealand) have free trade agreements and can therefore enter the market on more favorable terms than Italian wine, which is subject to a total tax burden of around 43% after payment of duties, excise taxes, and VAT. It is necessary to position oneself in the right market segment (medium-high), and to do so, it is necessary to plan the right commercial actions together with the distributor. Selling Ex-Works and hoping that the distributor will take care of everything is not an excellent strategy for being competitive.

                7 – China is dangerous

                Scams are always around the corner. In the wine world in particular, for example, spontaneous expressions of interest are frequent, arriving via the company website, social media accounts, or directly via email. They sound like this: we have discovered your wines, we think they are fantastic, we want to place an order immediately. If it sounds too good and easy, it is certainly a scam. There is an easy way to check: if the next step is a request for payment of a few thousand euros, justified by the need to register the wines on the CIFER (China Imported Food Enterprise Registration) portal, or to register your trademark to prevent others from doing so, or to authenticate the signature on the sales contract… these are attempts at fraud, and the elusive order will never arrive after payment has been received. How can you check whether the person you are dealing with is a reputable company or a fraudster? 👉🏼Go back to point 1 (here is an in-depth article).

                8 – E-commerce? Yes, but with method (and money)

                Online wine sales continue to grow, but entering large platforms is complex, competition is fierce, and running an online store requires meticulous planning and highly efficient system implementation. The online market in China is all pay-for-play. Nothing is achieved with no money or minimal effort. If you want to sell online, you need to build an omnichannel system integrated with traditional distribution, and to do this, it is essential to involve a local partner with well-defined investments and responsibilities.

                9 – China is not a market for everyone

                You need to protect your brands, study the market thoroughly, know your competition (both foreign and local), find the right market channel, select a distributor motivated to invest time and money in promoting your product, and be willing to support them with the right investments. If you want to build a serious plan to enter the Chinese market, you must have a medium- to long-term perspective. There are no shortcuts (actually, there are many, but they almost always lead to wasted time and money). If you are unwilling to invest in entering the Chinese market through the front door, it is unlikely that anyone else will do it for you.

                10 – Don’t do it yourself

                If you have read up to point 9 and are still keen to enter the Chinese market, consider doing so professionally, involving consultants who can support your company throughout the market research, scouting, negotiation, and contract drafting processes. This is also part of the investment needed to build and develop a solid and resilient business model. This advice applies to all foreign markets, and even more so to China.

                The most dangerous mistake one can make after the announcement of the (partial) suspension of U.S. duties for 90 days is to hope that everything will go well and we will return to the pre-April 2 world.

                First, because very invasive tariffs remain in place: 10 percent on all countries that trade with the U.S., including the EU, 25 percent on automotive, 25 percent on steel and aluminum, 145 percent on China.

                Second, because it is impossible to predict the actions of the U.S. Administration in the short and medium term: it cannot be ruled out that tariffs will remain, increase, change targets or that other factors will intervene to turn the tide in international markets, such as an escalation of the trade war with China.

                The 90-day suspension is an opportunity

                The U.S.’s temporary suspension of tariffs represents a valuable window that should be used not only as a truce but also as a valuable room for action: 90 days to rehash contracts, renegotiate key clauses, and insert levers of flexibility that can protect business in various future scenarios in the U.S. and other markets.

                Today’s exporters cannot afford to „sit back and see what will happen“-it is time to act, and to do so professionally and strategically. Let’s look at a checklist of important points to consider.

                What do contracts with customers and suppliers entail?

                The first point is to survey agreements with the trade network in the U.S. and other countries that export to the U.S., as well as with upstream suppliers in the supply chain.

                Is there a written contract? The worst-case scenario – unfortunately a very frequent one – is when the parties cooperate informally, only based on orders and order confirmations. This leaves undefined not only what happens in the case of imposition of duties, but also a whole range of other points, for example, limits on damages that can be claimed in the case of breach of contract, the duration of the agreement, the applicable law, and how any disputes will be resolved.

                Another very problematic scenario is one in which contracts exist, but they are generic and do not include the necessary covenants to manage the risks involved in operating in a highly litigious market such as the U.S., which, moreover, has very high legal costs.

                Having done this analysis, the necessary actions can be put in place, prioritizing according to the importance of business relationships and as appropriate:

                • Negotiate and conclude a written contract from scratch
                • Replace the existing agreement with a complete and correct contract
                • Amend and integrate the existing agreement with pacts to manage tariffs and other causes of price fluctuations

                Let us dwell on the last scenario, assuming that there is a complete and correct contract but one that does not regulate price and cost fluctuation as a direct or indirect consequence of the introduction of duties.

                Contract Addendum

                In such cases, the correct course of action is to sign an Addendum to the original contract, specifying which covenants are being waived and which covenants are being added. It is essential that the Addendum be negotiated and signed by persons with the power of representation of the parties and that it be drafted with the help of lawyers who specialize in this field. In addition to including correct clauses, it is necessary to verify that the covenants are valid according to the rules of law applicable to the contract.

                Here are some clauses that can be the subject of the Addendum, to be modulated according to the specific case and possible scenarios.

                Tariff Cost Sharing

                By introducing this covenant, it is provided that in the event that duties are confirmed at [x]% or are reduced or increased within certain established thresholds, the Parties will share the increase equally, or according to other established percentages.

                There may also be a ceiling on tariffs beyond which a party has the right to withdraw from the contract or request the suspension of certain orders for a specified period of time, after which it has the right to withdraw.

                Price Adjustment

                With this covenant, a discount or an increase in the product’s price is agreed upon, as the case may be, in the case of a duty greater than [x]%.

                Among the use cases, in addition to that of the company exporting to the U.S. or other intermediate markets, with final destination of the products in the U.S., is that of those who purchase a product subject to import duty and resell it, processed or assembled.

                Right to Cancel or Postpone Confirmed Orders

                This covenant gives the right to revoke or suspend for a certain period already negotiated orders, as such binding, in case of confirmation or introduction of duties above a certain threshold, for example, if 20% taxation was confirmed for the import of wine from the EU.

                The clause can be combined with previous covenants, for example, by stipulating that below the specified threshold, the contracts remain valid, and the parties share the duty or have the right to renegotiate the price.

                Supply Forecast Adjustment

                With this clause the Parties can modify supply programs already agreed for a specific duration (e.g., 24 months), with continuous sales and purchase obligations at a fixed price or indexable only within certain limits. The aim is to agree on the prerequisites for reshaping supply programs in the short and medium term, which can be very useful for defining the rules that will apply to relationships with key suppliers or customers for possible changes in volumes, delivery times, and prices.

                Right to Source from Alternative Suppliers

                This covenant serves to be authorized, if necessary, to source alternative suppliers of components or raw materials to those previously authorized in the contract with the end customer, for example, in cases where purchasing from the original suppliers has become too costly or difficult due to duties imposed at import or in previous steps in the supply chain, or other events such as currency or price fluctuation of certain commodities beyond a certain level established in the agreement.

                Hardship and Force Majeure

                The imposition of duties cannot be invoked as a cause of Force Majeure or hardship, respectively, to excuse contract non-performance or to renegotiate the price, even in cases of very high price increases (such as the 145% duty imposed on Chinese products). This conclusion is almost uniform under the law and jurisprudence of the major countries involved in the tariff war: U.S., China, Canada, Mexico, France and Italy: I refer to this practical guide for a timely examination of what the various rules provide.

                If the contract lacks a well drafter Force Majeure and Hardship clause, or contains a generic clause, it is important to get your hands on revising it to expressly state the cases in which a party is entitled to suspend or terminate the contract, how and when to communicate the decision to invoke the exemption, and the consequences on the parties‘ contractual obligations. You can go deeper on this topic here.

                Conclusion

                It is essential to prepare for possible future scenarios regarding duties (confirmed, increased, changed, or decreased) and to determine the consequences on trade relations with foreign clients and suppliers: moving today, at a standstill (or nearly so), allows entrepreneurs to negotiate shared and fair solutions and to avoid, as far as possible, the emergence of tensions and conflicts with the various partners along the international supply chain.

                Andreas Eustacchio

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                  When Life Gives You Tariffs… Make New Allies: Brazil, Europe and a New Trade Chapter

                  3. April 2025

                  • Brasilien
                  • Vertrieb
                  • Steuer

                  It is quite common for business relationships with agents or distributors to last for years without any signed documents. And be careful, because we know that a contract can exist even verbally.

                  The absence of a written contract will add difficulties in the event of a possible claim, so what you do between the decision to terminate, and the moment of the claim is very important. Remember: ‘anything you write will be used against you’.

                  The decision to terminate a business relationship is a very delicate moment to which, for some reason, solicitors are not invited. Here are some examples (all real) in which companies or employees with the best of intentions wrote to the agent/distributor. All of them were subsequently very damaging to the company:

                  Saying ‘We are terminating our business relationship’ when the strategy will be to argue that no such business relationship exists, but rather that there are separate and linked contracts (e.g., supply rather than ongoing distribution contract; very significant compensation consequences).

                  ‘You no longer represent our company’, which may be evidence that you did so before.

                  ‘As of day X, you may no longer act on behalf of our company,’ which would prove that you were previously able to act on its behalf.

                  ‘You may not attend the X trade fair on our behalf.’ A way of confirming that the agent/distributor’s responsibilities included participating in trade fairs and probably accrediting the customers obtained.

                  ‘The sales you promoted have been significantly reduced in year N.’ When there is no written contract or other form of documentation, imputing a breach of an obligation that is not clear can be counterproductive.

                  Saying ‘You are not actively promoting our products’ and then adding: ‘We urge you to stop promoting the sale of our products’.

                  ‘You are no longer our exclusive representative’, which proves a type of relationship (representation/agent) and a tacit or express agreement (‘exclusivity’).

                  ‘We have appointed another representative in your area’, which shows that the agent/distributor had an assigned area and was “representing”.

                  ‘From this moment on, orders will be handled by X’, which also confirms a type of relationship.

                   

                  In summary: from the moment the company considers terminating a commercial relationship, especially when it is not in writing and before sending any letter, it is advisable to think carefully about the strategy in case of a possible claim. This is the best time to seek advice and avoid surprises. Any communication that is not in line with this strategy designed from the outset can only lead to confusion and problems.

                  Remember the USA – EU agreement on 15% tariffs? I wrote that with a negotiator like Trump the game is never over (article here) and—after the recent interlude featuring a threat of 100% tariffs on pharmaceuticals—the U.S. government has announced the imposition of an overall 107% duty on Italian pasta, which could take effect on January 1, 2026.

                  Where this new duty comes from

                  The antidumping investigation was launched by the U.S. Department of Commerce at the request of certain competing American companies and is based on a 1996 antidumping order that allows for periodic reviews of imports of Italian pasta. The Department of Commerce conducts these checks annually to assess whether Italian producers are selling pasta at prices lower than the U.S. domestic market, a practice known as “dumping.”

                  Companies involved in the investigation

                  The Department of Commerce selected two sample companies for in-depth analysis, defined as “mandatory respondents”: La Molisana and Pastificio Lucio Garofalo. According to the official document published by the U.S. administration, for the period from July 1, 2023 to June 30, 2024, both companies allegedly sold their products below market prices, resulting in the imposition of a duty of 91.74%.

                  U.S. authorities justified this percentage by claiming the two companies did not provide complete or compliant information as requested by the Department and were therefore insufficiently cooperative during the investigation. What is very important is that, in addition to the two companies directly examined, the additional 91.74% duty is also applied to numerous other Italian producers not individually reviewed. This methodology, while formally permitted under U.S. law as an exception, is being applied without any direct verification of the other companies.

                  Next steps in the procedure

                  Italy’s Ministry of Foreign Affairs moved immediately, formally intervening in the proceeding as an “interested party” through the Italian Embassy in Washington. The Foreign Ministry is working in close coordination with the companies concerned and, in concert with the European Commission, to persuade the U.S. Department to revise the provisional duties.

                  The two companies involved (La Molisana and Garofalo) can submit documentation to contest the dumping allegations. However, if dumping is confirmed, the Department of Commerce will instruct Customs to apply antidumping duties on goods sold and entered into U.S. commerce.

                  The preliminary nature of this determination means there is still room to change the decision before it becomes final.

                  Possible effective date

                  The new super-duty of 91.74%, which will be added to the existing 15% tariff for a total of 107%, is scheduled to take effect on January 1, 2026. This date therefore represents a crucial deadline for all ongoing diplomatic and legal actions.

                  If confirmed, the economic impact would be significant: in 2024, Italian pasta exports to the United States reached a value of €671 million according to Coldiretti, accounting for nearly 17% of the sector’s total exports. A 107% duty would risk seriously undermining competitiveness in one of the most important markets for Italian agri-food products.

                   What to do between now and January 1, 2026?

                  At this stage, the entry into force of the new duty depends on the outcome of the ongoing procedure: given what has happened in recent months, and the political use the U.S. administration has made of tariffs—well beyond their technical function—it is reasonable to be pessimistic.

                  So, what to do? In recent months we have seen companies react to the uncertainty over the fate of the tariffs in three ways:

                  • Some rushed to ship as many products as possible before the potential effective date of the duty;
                  • Some granted—upfront—discounts equivalent to the threatened duty, in case it came into force;
                  • Some suspended orders, pending definitive news on the impact of the duties.

                  These are all  valid options, but other effective tools for managing the uncertainty caused by the flurry of announcements, negotiations, and threats from the U.S. administration should not be forgotten: the risk of new duties being introduced, or existing ones being increased, can be managed in the contract by agreeing with the U.S. importer how any tariff change will affect the product.

                  The parties can stipulate, for example, that the increase will be split equally; or that the importer will bear it beyond a certain threshold; or that if the duty exceeds a certain level, the contracts may be terminated. You can find a deeper dive in this article.

                  The only certainty is that trade relations with the U.S. will stay unpredictable for a long time, and it’s vital to carefully manage the risk factors involved in selling products there. Right now, the focus is on tariffs and prices, and I encourage you to take this chance to thoroughly review existing agreements and assess whether—and how—other important points are addressed that could entail significant liabilities: we discuss them, very practically, in this book.

                  On 29 June 2025, the Vietnamese government introduced Decree No. 163/2025/ND-CP (Decree 163). This decree provides detailed guidance on how the updated Law on Pharmacy will be implemented.

                  Like the amended Law on Pharmacy, Decree 163 came into effect on 1 July 2025, replacing the previous Decree No. 54/2017/ND-CP (Decree 54). The new decree sets out comprehensive rules for key aspects of managing pharmaceuticals, including:

                  • Pharmacy practice certificates
                  • Certificates allowing pharmaceutical businesses to operate
                  • Import and export of medicines and drug ingredients
                  • Good Manufacturing Practice (GMP) inspections of overseas manufacturers
                  • Recalling medicines and drug ingredients
                  • Certificates for medicine advertising content
                  • Medicine price management

                  Key Changes in Decree 163

                  Here are some important changes and additions introduced by Decree 163:

                  Destroying Specially Controlled Medicines

                  You no longer need to get approval from the relevant authority before destroying narcotic, psychotropic, and precursor drugs, or pharmaceutical ingredients that are narcotic or psychotropic substances or precursors used in medicines. Instead, you just need to provide notification at least seven working days in advance. This notification must include the planned destruction date and a detailed list of items to be destroyed.

                  E-commerce in Pharmaceutical

                  Pharmaceutical businesses that sell products online must openly display the following information to ensure transparency and consumer safety:

                  • Their certificate allowing them to operate as a pharmaceutical business.
                  • The pharmacy practice certificate of the person responsible for pharmaceutical expertise.
                  • Information about the medicines themselves.

                  Shelf-Life Rules for Imported Products

                  For medicines and ingredients with a total shelf life of nine months or less, at least one-third of their shelf life must remain when they clear customs. Medicines with a shelf life of 30 days or less must still be within their shelf life at the time of customs clearance.

                  Controlling Imported Products

                  All medicines with marketing authorisation (MA) are subject to import control, except for:

                  • Medicines needed for preventing and treating Group A infectious diseases that have been declared epidemics, as per the Law on Prevention and Control of Infectious Diseases.
                  • Medicines with a shelf life of less than 30 days.

                  Importers must inform the provincial People’s Committee at least five working days before making a customs declaration. The People’s Committee can then issue a written notice of non-compliance to the customs authority within five working days of receiving this notification.

                  Medicine Advertising

                  Decree 163 adds a process that allows an approved medicine advertising certificate to be adjusted for certain changes (such as a change to the MA holder or manufacturer information). This means you don’t have to go through the entire initial registration process for medicine advertising content again, as was required under the previous rules.

                  Medicine Price Management

                  Businesses must announce or re-announce wholesale prices, similar to the medicine price declaration process under Decree 54. Some medicines are exempt from this requirement, including those provided free of charge for emergency responses, national health programmes, humanitarian aid, clinical trials, scientific research, or exhibition purposes, and medicines carried as personal luggage.

                  The Ministry of Health (MOH) can make recommendations if the announced or re-announced price is significantly higher than similar medicines already on the market. This includes situations where:

                  • The announced or re-announced wholesale price of the medicine is higher than the highest price of similar medicines.
                  • The price difference is more than 35% (for medicines priced under VND 1 million) or 15% (for medicines priced at VND 1 million and above) compared to winning bid prices in tenders.
                  • The announced or re-announced price is higher than prices in the country of origin or other markets (if there’s no similar product in Vietnam).
                  • When such differences are found, the MOH issues a formal recommendation to the announcing business and publishes it online for transparency and accountability.

                  Further Guidance in New Circular

                  On 1 July 2025, the MOH issued Circular No. 31/2025/TT-BYT (Circular 31), which further details how the amended Law on Pharmacy and Decree 163 should be implemented. Circular 31 officially replaces Circular No. 07/2018/TT-BYT and Decree 54 and came into effect immediately.

                  Key provisions of Circular 31 include:

                  Notification of Practising Pharmacists

                  Pharmaceutical businesses that are not part of a pharmacy chain must inform the relevant authority of a list of people currently working at the business who hold pharmacy practice certificates. This notification must be submitted within 15 days of the date the certificate allowing the pharmaceutical business to operate was issued, or when there are any changes to the list. This is a shorter deadline than the previous 30 days under earlier rules.

                  Pharmacy chains have similar notification duties and deadlines. Specifically, the chain operator must inform the provincial authority where each pharmacy in the chain is located about the list of practising pharmacists at those sites. Additionally, pharmacy chains must notify the authority if pharmacies are added or removed from the chain, and if there are any rotations of the people responsible for pharmaceutical expertise between pharmacies within the chain.

                  Medicine Information Activities

                  Under Circular 31, medicine information can still be given to healthcare professionals through information materials, seminars, and medical representatives.

                  However, Circular 31 introduces a significant change by removing the need to obtain a certificate for medicine information content before carrying out these activities. Under the new rules, pharmaceutical businesses, representative offices of foreign pharmaceutical companies in Vietnam, and MA holders are now responsible for creating and distributing medicine information materials. These materials must comply with the package inserts for medicines approved by the MOH, the Vietnamese National Drug Formulary, and any related documents and professional instructions issued or recognised by the MOH.

                  Donald Trump, never one to shy away from drama or diplomacy-via-caps-lock, has slapped a 50% tariff on all Brazilian exports to the United States. The justification? In his own delicate prose: „The treatment of former President Jair Bolsonaro is a disgrace… A witch hunt that must end IMMEDIATELY!“

                  And just in case anyone thought this was about trade imbalances or economic strategy, Trump made things crystal clear: „Due to Brazil’s insidious attacks on free elections…“.

                  In short, the 50% tariff isn’t about coffee, orange juice, or flip-flops. It’s about a Supreme Court judgment, applying Brazilian law, regarding Brazilian politicians accused of conspiring in a coup d’état. In other words, this is a brazen (and frankly absurd) attempt at judicial intervention via trade war.

                  Trump, with his characteristic subtlety, offered a solution: manufacture in the U.S., and he’ll look kindly upon Brazil, like a mafia don offering „protection“ after smashing your shop window. But what he meant was: consider Bolsonaro innocent, and we’ll talk.

                  The Brazilian market took the bait

                  Although the fishy interference in Brazilian affairs was determined from a fish out of the water, the market took the bait: in the first 48 hours after the infamous letter, at least 1500 tons of fish were already held in Brazilian ports, as US buyers suspended their contracts due to uncertainty about the costs upon arrival. The fish market is on alert, as 80% of the exports head to the US, mainly coming from small family-owned industries that distribute the catch from artisanal fishing communities.

                  The same effect hit other sectors, from orange, honey, and coffee to aircraft.

                  Brazil’s response and sorcery: don’t mess with us (or our weather)

                  Naturally, Brazil will not sit quietly sipping caipirinhas while its sovereignty is trampled. Reciprocity is on the table: if Washington raises tariffs, Brasília can do the same. But above all, one thing is sure: Brazil will never tolerate foreign interference in its independent judiciary.

                  And then, a curious coincidence: right after Trump’s speech, a tornado accompanied by lightning struck the White House grounds. Pure chance? Maybe. Or could it have been the work of Brazilian indigenous shamans, a particularly well-organized group of umbanda practitioners, or simply the fact that, as every Brazilian child knows, God is Brazilian.

                  Trump might want to check the weather forecast next time before penning another angry letter.

                  The unpredictable becoming predictable

                  Trade wars are rarely tidy affairs, but one thing they consistently deliver is chaos (in legal terms, disruption). And when disruption meets contracts, force majeure disputes often end up in court.

                  At first glance, Trump’s decision to impose a 50% tariff overnight might feel like an unpredictable thunderbolt (quite literally, given the weather at the White House). But here’s the catch: by now, unpredictable tariffs are becoming predictable. When a government with a well-documented love for impulsive economic diplomacy imposes politically motivated tariffs, can anyone claim to be surprised?

                  In most jurisdictions, force majeure requires that the event be extraordinary, unforeseeable, and beyond the parties’ control. A sudden 50% tariff certainly ticks a few of those boxes, but following a repetition of erratic trade policy, one might argue that businesses should expect what in past times was considered unexpected, especially when dealing with certain jurisdictions or political figures. In other words, Trump’s tariffs might not excuse performance if parties didn’t prepare for exactly this kind of volatility.

                  This is where good contract drafting comes into play

                  Savvy businesses are learning that their contracts must go beyond a vague boilerplate clause about “acts of government” or “changes in law.” Instead, they should expressly address the risk of sudden tariff changes, including

                  • hardship clauses that allow renegotiation when costs become commercially unreasonable;
                  • price adjustment mechanisms linked to tariff thresholds;
                  • termination rights triggered by specified levels of customs duties;
                  • currency fluctuation provisions (because tariffs rarely travel alone, and currency swings often accompany them).

                  In short, while no contract can immunize a business from every shock, smart drafting can mean the difference between a commercial headache and a catastrophic breach.

                  Therefore, tariffs may no longer be an unpredictable storm; they are part of the new predictable landscape. Given that your contract might wake up tomorrow facing ‘IMMEDIATE’ punitive tariffs in all caps, your contract should be ready today.

                  The unwitting cupid: strengthening EU-Brazil relations

                  While the tariffs may ruffle trade flows between Brasília and Washington, there’s an unintended silver lining: Trump is proving to be the most efficient matchmaker between Brazil and other markets, such as China and the European Union.

                  The EU-Brazil relationship, already a flirtation with promising prospects, with relevant progress in the EU-Mercosur Agreement, now seems destined for deeper romance. If Mr. Trump insists on isolating the US from Brazil, the old continent stands ready, with flowers and wine in hand, to pick up where the US left off. After all, Brazilian fish can pair up nicely with champagne, cava and prosecco.

                  So thank you, Mr. Trump. In your quest to bully Brazil into submission, you may have done more to strengthen transatlantic ties than any EU Commissioner ever could. As they say in Brasília these days: Trump is not a trade warrior. He’s a cupid in disguise.

                  The recent announcement of a landmark trade agreement framework, following just three months negotiations since President Trump’s tariffs announcement on 2 April 2025, signals a pivotal shift, not merely in bilateral relations, but in the broader architecture of global supply chains.

                  As a commercial lawyer with exposure to Vietnam since 2007, I have observed the evolving dynamics between the United States and Vietnam through the years, talking to students, entrepreneurs, veterans, diplomats, humans from all walks all life, from both nations and beyond.

                  You may recall that Vietnam, with the notable exclusion of China, was to be the nation that would encounter the most stringent tariffs imposed by the Trump administration, reaching an astonishing 46%.

                  The newly forged framework outlines significant reciprocal concessions designed to foster greater trade and investment flows. Granted, pre-April 2 tariffs applied by the USA on Vietnamese goods were lower than what emerges from the framework agreement, but still, it is better than 46%),

                  The United States has committed to imposing a 20% tariff on most Vietnamese imports, a notable reduction from the previously mooted 46%. However, a substantial 40% tariff will apply to goods re-exported from third countries, with a particular focus on those originating from China.

                  Vietnam has pledged to open its market to a wide array of US products. Crucially, it has also committed to implementing stringent measures aimed at restricting the transshipment of Chinese goods through its territory, a long-standing concern for Washington.

                  In a significant win for American exporters, US goods will now enjoy duty-free access to the Vietnamese market, effectively granting “total access”, particularly for large-engine vehicles such as SUVs, as emphatically stated by President Trump (how SUVs are going to circulate in the narrow alleys of Hanoi and Ho Chi Minh City, infested by swarms of mopeds, is a different story).

                  This agreement is expected to catalyse growth in several key sectors. Electronics, textiles, furniture, energy (especially Liquefied Natural Gas), and agriculture are poised for expansion. US firms specialising in manufacturing technology, energy solutions, and agricultural products are anticipated to be the primary beneficiaries. Furthermore, beyond immediate trade benefits, the agreement is set to reshape investment strategies, encouraging a greater localisation of supply chains within Vietnam. This strategic realignment is also expected to further solidify the already robust US-Vietnam Comprehensive Strategic Partnership.

                  While the potential upsides are considerable, it is imperative for businesses and investors to approach this new landscape with a clear understanding of the accompanying risks. From my vantage point, I identify several significant execution challenges and structural impediments that require close monitoring.

                  Enforcement of Transshipment Controls

                  The most immediate and perhaps formidable risk lies in the effective enforcement of transshipment controls. Vietnam has historically served as a significant assembly point for Chinese-manufactured components. Ensuring that goods originating from China are not merely re-routed through Vietnam to circumvent US tariffs will require exceptionally close monitoring and robust verification mechanisms. The legal and practical complexities of definitively determining the true country of origin for all goods will undoubtedly pose a persistent challenge. As a European citizen, witnessing how the EU-Vietnam Free Trade Agreement (“EVFTA”), which poses an important stress on certificates of origin, I am particularly aware of this matter.

                  While Vietnam has made remarkable strides in its economic development, certain structural issues could hinder its capacity to scale up high-value manufacturing in the short to medium term. These include:

                  Legal framework nuances

                  Vietnam’s legal framework for foreign investment has seen continuous improvements, but legal and cultural complexities and inconsistencies can and do still arise. Navigating the regulatory landscape, particularly with new rules stemming from this agreement and at a time of deep administrative, governmental, digital and legal reforms in Vietnam, will demand expert legal guidance to ensure compliance and mitigate potential fines and disputes. Issues surrounding so-called sublicences for businesses, intellectual property rights enforcement and contract enforceability, whilst improving, still require careful consideration;

                  Education

                  The ambition to transform Vietnam into a high-value manufacturing hub necessitates a workforce equipped with advanced skills. While the Vietnamese government prioritises education and workforce development, a significant portion of the current labour force lacks formal training and specialised certifications, let alone a good command of the English language. Bridging this skills gap, particularly in areas like advanced manufacturing, engineering, and digital technologies is a necessity and not just in light of this framework agreement. Companies may need to factor in substantial investment in training and upskilling programmes for their Vietnamese employees.

                  Infrastructures

                  Despite considerable investment, Vietnam’s infrastructure, particularly in logistics, energy, and transportation, continues to face bottlenecks. And China – the apparent target of Trump’s tariffs – is stepping in with high-speed trains connecting it to the northern Provinces of Vietnam. An increased volume of high-value manufacturing and trade will place further strain on existing infrastructure. Inadequate port capacity, congested roads, and a reliable energy supply (including for EV charging) are critical concerns that could impact efficiency and increase operational costs for businesses.

                  Policy divergence

                  This framework agreement deepens US-Vietnam trade ties and seems to be paving the way for more US investments in Vietnam, but this second aspect seems to run counter to parallel US policy objectives aimed at reshoring manufacturing back to the United States. This potential divergence in strategic priorities could introduce yet another element of unpredictability in the long term, necessitating a flexible and adaptable investment approach. Future shifts in US policy could impact the durability and full extent of the benefits derived from this agreement.

                  This trade agreement, if finalised and implemented, undoubtedly represents a structural shift in global trade dynamics. It strategically positions Vietnam as an increasingly important high-value manufacturing hub and significantly deepens US engagement in Southeast Asia. We will need time, however, to assess the practical impact of the agreement, observing the efficacy of its implementation, and understanding how Vietnam’s inherent strengths and challenges will ultimately shape its role in the reconfigured global supply chain.

                  We will also need to see what China, if anything, will do as a countermeasure. In fact, any assessment of Vietnam’s evolving trade landscape would be incomplete without a thorough consideration of China’s influence and strategic posture. President Xi Jinping has consistently championed a vision of a “community of shared future for mankind,” a concept that, while outwardly promoting global cooperation, also subtly underscores a demand for international alignment with Beijing’s interests. In the context of escalating trade tensions, Xi has repeatedly warned that “trade wars have no winners,” advocating for unity against protectionist measures, yet simultaneously implying that nations must ultimately choose sides, either with or against China’s economic and political orbit. Vietnam, despite its historical complexities and occasional maritime disputes with Beijing in the South China Sea (or East Sea, as it is officially called by Hanoi), remains deeply interwoven with China’s economy. China has been Vietnam’s largest trading partner for many years, with significant inflows of Chinese FDI, loans, and project contractors. This economic dependency is particularly evident in various sectors, where Chinese components and materials form a substantial part of Vietnamese manufacturing supply chains. While Vietnam has actively sought to diversify its trade partners and reduce its reliance on China, the sheer scale of the bilateral economic relationship means that disentanglement is a long-term, complex endeavour. Furthermore, China’s influence extends beyond direct trade into crucial regional resources. The Mekong River, a lifeline for millions in Southeast Asia, originates in China, which has constructed numerous upstream dams.

                  As Vietnam navigates its enhanced trade relationship with the United States, it must simultaneously contend with the enduring economic gravity and strategic ambitions of its northern giant neighbour. Any perceived move by Vietnam to significantly shift away from China could invite retaliatory measures or heightened pressure from Beijing. Businesses investing in Vietnam must not only grasp the intricacies of the US-Vietnam agreement but also meticulously analyse how these developments will intersect with, and potentially be impacted by, the intricate, often delicate, and sometimes fraught relationship between Hanoi and Beijing. Understanding this geopolitical tightrope will be essential for sustainable success in the Vietnamese market. Prudence, informed legal counsel, and a keen eye on evolving geopolitical and economic realities will be paramount for those seeking to capitalise on this transformative new chapter.

                  Takeaways

                  • Tariffs:The US-Vietnam framework agreement marks a significant departure from previous trade dynamics, reducing US tariffs on most Vietnamese imports to 20% (from a mooted 46%) while imposing a 40% tariff on transshipped goods, especially from China.
                  • Vietnam’s market opening:Vietnam has committed to duty-free access for a broad range of US products and stricter controls on Chinese goods transiting its territory.
                  • Growth / manufacturing shift potential:The agreement is expected to fuel expansion in Vietnamese electronics, textiles, furniture, energy (LNG), and agriculture. It also encourages supply chain localisation within Vietnam (normally more of an assembly point for Chinese products).
                  • Execution challenges: Effectively preventing the re-routing of Chinese goods through Vietnam to avoid tariffs will be a complex and demanding task; Despite economic progress, Vietnam faces hurdles in scaling high-value manufacturing due to legal framework nuances (e.g., sublicences, IP enforcement), a skills gap in its workforce (lack of formal training, English proficiency) and infrastructure bottlenecks (logistics, energy, transportation).
                  • US policy divergence:The agreement’s encouragement of US investment in Vietnam appears to contradict the broader US policy objective of reshoring manufacturing.
                  • China:Businesses must consider China’s significant economic sway over Vietnam, including its position as Vietnam’s largest trading partner, its FDI, and its control over shared resources like the Mekong River. Any major shift by Vietnam away from China could lead to retaliatory measures from Beijing.
                  • Uncertainty:This is not a final agreement, so the situation might change. Prudence and informed legal counsel are crucial for businesses navigating this evolving landscape.

                  The Trump approach: power and dominance

                  In his autobiography, The Art of the Deal, Donald Trump describes negotiation as a contest of strength, determination, and dominance. His vision is clear: anyone who shows uncertainty or makes concessions too early is immediately perceived as a loser. His negotiating style is based on constant pressure, maximalist demands, and calculated threats, to obtain unilateral advantages. In this scheme, compromise is not a point of arrival, but a sign of weakness to be avoided.

                  Trump has always been a competitive negotiator, focused on immediate results and uninterested in balanced solutions unless they are strictly functional to his interests.

                  Other negotiating styles: compromising and collaborative

                  In contrast to this competitive approach, there are two other relevant negotiating styles:

                  • The compromising style aims to reach a ‘middle ground’ agreement, in which both parties give something up to achieve an acceptable solution. It is a pragmatic approach, practical in situations where time is limited or positions are too far apart for genuine collaboration.
                  • The collaborative style, on the other hand, aims to create win-win solutions. The parties seek to thoroughly understand each other’s interests and work together to build an outcome that maximizes the benefit for both. It requires openness, time, and trust.

                  In commercial negotiations, the compromising or collaborative approach can only work if the other party shares the same logic. But when dealing with an explicitly competitive actor such as Trump, adopting a compromising style risks seriously penalizing the other party, for at least three reasons:

                  • It conveys weakness

                  An accommodating gesture is seen not as a sign of openness, but as a point of pressure to be exploited. The competitive negotiator, focused on gaining an immediate advantage, interprets it as a willingness to give even more.

                  • It relinquishes bargaining power

                  The EU has a vast market and significant trade levers, especially in a context where the US is closing the door to the Chinese market. Offering concessions at the outset is tantamount to burning your cards without getting anything in return. In a competitive confrontation, the first move can set the tone for the negotiation: once a concession has been made, it is very difficult to backtrack.

                  • It legitimizes the negotiating imbalance

                  An unbalanced compromise, if accepted without resistance, risks becoming the new basis for future trade relations, systematically penalizing the EU in subsequent rounds.

                  Why 30%? The anchor technique

                  Trump often uses a negotiating technique known as the anchor technique. This consists of deliberately setting a very high target at the beginning of the negotiation (in our case, the threat of 30% tariffs).

                  The aim is to create a psychological perimeter for the negotiation and force the other party to reason on the basis of that figure, even though they are aware that it is arbitrary. This technique allows one to influence the scope of the discussion and obtain greater concessions, just as Trump has done.

                  The worst response: unilateral concessions with no return

                  Unfortunately, the European Union has already shown worrying signs of a compromising attitude that has not been negotiated with the Trump administration, for example:

                  • The waiver of the web tax* on American digital giants, without obtaining any regulation or shared tax contribution in return.
                  • The offer to increase imports of liquefied natural gas (LNG) from the US, made to reassure Washington, without obtaining anything in return.
                  • The acceptance of the increase in NATO spending to 5% of GDP, demanded by Trump, again without obtaining anything in return.

                  All these offers without asking for anything in return reinforce the idea that the EU is willing to concede from the outset. Trump, true to his competitive logic, sees these concessions as a starting point, not a compromise: this pushes him to raise his demands, not moderate them.

                  Persevering would be a fatal mistake

                  Continuing along this path of compromise, in the hope that accommodation will ease the pressure, would be not only ineffective but counterproductive. With a competitive negotiator, unilateral concessions do not stop escalation: they fuel it. Any sign of weakness is interpreted as additional room for maneuver.

                  A helpful example is China’s reaction during the trade war initiated by Trump. Faced with massive tariffs imposed by the US, Beijing responded in kind, imposing equivalent tariffs. Instead of giving in, it spoke the same language of power. The result is there for all to see: after weeks of escalation, the US had to moderate its position, opening up to a more balanced agreement.

                  The right strategy: speak his language

                  To avoid the mistakes of the past, the EU should therefore reverse its negotiating logic. Not to fuel confrontation, but to restore a credible balance. Some applicable countermeasures could be:

                  • Target Trump’s electoral base, particularly the agricultural sectors (soy, corn, beef), with selective tariffs or targeted restrictions.
                  • Put the European web tax* back on the table, even with a minimum rate, linking any exemptions to real concessions from the US.

                  These well-calibrated moves would strengthen the EU’s position and show that it can defend its interests by speaking a language Trump understands: that of strength and bargaining power.

                  Going beyond requests, seeking the other party’s interests

                  A fundamental principle in any negotiation is to identify the other side’s interests and find a way to allow them to achieve them without sacrificing your own. This is no easy task, given Trump’s notorious volatility and the lack of sound arguments to justify the demands made in the negotiations.

                  In the case of the EU-US negotiations, it must be borne in mind that Trump is playing the game with his electoral base in mind: an agreement must offer him a narrative of victory to communicate to his electorate.

                  Takeaway

                  When negotiating with a competitive player like Trump, one should abandon the accommodating approach, avoid concessions without something in return, and adopt a style that is more assertive, strategic, and symmetrical.

                  Only then will it be able to build an agreement that is solid, fair, and respectful of its economic and political strength.

                  I have often dealt with commercial distribution agreements between Italian and Chinese companies, sometimes following negotiations in the wine sector for various types of agreements: sales, distribution, franchising, establishment of joint ventures, and sales through online stores.

                  I am sharing some key considerations for approaching this complex but opportunity-rich market.

                  📌 Here are my 10 takeaways

                  Step Zero. Protect your IP

                  it is essential to protect your intellectual property before entering China. This includes trademarks (including their Chinese transliteration), labels, web domains, and social media accounts. Neglecting this aspect can have disastrous consequences, exposing you to the widespread phenomenon of trademark squatting (even famous names such as Michael Jordan, Elon Musk, and Donald Trump have fallen victim to this).

                  For more information, you can read this article about Intellectual property protection in China

                  1 – Know your enemy

                  trust is good, but mistrust is better. Before entering into commercial agreements, it is essential to check the credentials of potential partners through the databases of the State Administration for Industry and Commerce. When it comes to wine, it is necessary to check whether the prospective distributor has a license to import and distribute wine.

                  2 – No copy-paste

                   Contracts must be tailor-made, adapting them to local specificities. In particular, it is crucial to clearly regulate promotional activities: budget, commercial actions, communication methods, and management of the producer’s trademarks. It is also best to write the contract in Chinese to ensure that there are no misunderstandings and in case it needs to be used before a judge or local administrative body, as Chinese is the only official language. (N.B.: if you think of entrusting the task to ChatGPT, this is not a good idea).

                  For an in-depth article, check out The commercial distribution contract in China

                  3 – Decide immediately how and where to litigate

                  It may seem counterintuitive, but it is best to avoid providing for Italian (or French, or German) jurisdiction and applicable law, which is an ineffective solution, especially in cases where urgent action is needed to stop unfair competition or counterfeiting. Consider applying Chinese law and provide for an arbitration clause at CIETAC. An effective dispute management strategy is a key element of the agreement and must be negotiated carefully. (P.S.: This applies not only to China but to all international agreements. For more information, see this article).

                  4 – China is big

                  And it is the sum of many very different internal markets. Exclusivity should be granted for good reasons, but only if the distributor has a well-developed commercial network and can achieve specific shared objectives. If granted, it should be limited to the province where the distributor is based and subject to the achievement of agreed sales volumes. Having a single distributor for the whole of China is like entrusting an Italian distributor with promoting a product throughout Europe. Or appoint a NYC-based company to promote and sell your wines in all 50 US States.

                  5 – China is far away

                  Delegating everything to the local distributor and taking no interest in what is happening on the Chinese market is never a good idea. Firstly, because you have no idea how, where, and with what results the wines are being sold. Secondly, because you cannot verify compliance with agreements, for example on non-competition or the use of trademarks. It is therefore important to schedule meetings to share commercial policies and be able to verify what is happening, including through audits and visits to warehouses and the sales network.

                  6 – China is expensive

                  Competition in the Chinese domestic market is fierce. This is also true in terms of price, as some countries that are direct competitors of Italy (Australia, Chile, New Zealand) have free trade agreements and can therefore enter the market on more favorable terms than Italian wine, which is subject to a total tax burden of around 43% after payment of duties, excise taxes, and VAT. It is necessary to position oneself in the right market segment (medium-high), and to do so, it is necessary to plan the right commercial actions together with the distributor. Selling Ex-Works and hoping that the distributor will take care of everything is not an excellent strategy for being competitive.

                  7 – China is dangerous

                  Scams are always around the corner. In the wine world in particular, for example, spontaneous expressions of interest are frequent, arriving via the company website, social media accounts, or directly via email. They sound like this: we have discovered your wines, we think they are fantastic, we want to place an order immediately. If it sounds too good and easy, it is certainly a scam. There is an easy way to check: if the next step is a request for payment of a few thousand euros, justified by the need to register the wines on the CIFER (China Imported Food Enterprise Registration) portal, or to register your trademark to prevent others from doing so, or to authenticate the signature on the sales contract… these are attempts at fraud, and the elusive order will never arrive after payment has been received. How can you check whether the person you are dealing with is a reputable company or a fraudster? 👉🏼Go back to point 1 (here is an in-depth article).

                  8 – E-commerce? Yes, but with method (and money)

                  Online wine sales continue to grow, but entering large platforms is complex, competition is fierce, and running an online store requires meticulous planning and highly efficient system implementation. The online market in China is all pay-for-play. Nothing is achieved with no money or minimal effort. If you want to sell online, you need to build an omnichannel system integrated with traditional distribution, and to do this, it is essential to involve a local partner with well-defined investments and responsibilities.

                  9 – China is not a market for everyone

                  You need to protect your brands, study the market thoroughly, know your competition (both foreign and local), find the right market channel, select a distributor motivated to invest time and money in promoting your product, and be willing to support them with the right investments. If you want to build a serious plan to enter the Chinese market, you must have a medium- to long-term perspective. There are no shortcuts (actually, there are many, but they almost always lead to wasted time and money). If you are unwilling to invest in entering the Chinese market through the front door, it is unlikely that anyone else will do it for you.

                  10 – Don’t do it yourself

                  If you have read up to point 9 and are still keen to enter the Chinese market, consider doing so professionally, involving consultants who can support your company throughout the market research, scouting, negotiation, and contract drafting processes. This is also part of the investment needed to build and develop a solid and resilient business model. This advice applies to all foreign markets, and even more so to China.

                  The most dangerous mistake one can make after the announcement of the (partial) suspension of U.S. duties for 90 days is to hope that everything will go well and we will return to the pre-April 2 world.

                  First, because very invasive tariffs remain in place: 10 percent on all countries that trade with the U.S., including the EU, 25 percent on automotive, 25 percent on steel and aluminum, 145 percent on China.

                  Second, because it is impossible to predict the actions of the U.S. Administration in the short and medium term: it cannot be ruled out that tariffs will remain, increase, change targets or that other factors will intervene to turn the tide in international markets, such as an escalation of the trade war with China.

                  The 90-day suspension is an opportunity

                  The U.S.’s temporary suspension of tariffs represents a valuable window that should be used not only as a truce but also as a valuable room for action: 90 days to rehash contracts, renegotiate key clauses, and insert levers of flexibility that can protect business in various future scenarios in the U.S. and other markets.

                  Today’s exporters cannot afford to „sit back and see what will happen“-it is time to act, and to do so professionally and strategically. Let’s look at a checklist of important points to consider.

                  What do contracts with customers and suppliers entail?

                  The first point is to survey agreements with the trade network in the U.S. and other countries that export to the U.S., as well as with upstream suppliers in the supply chain.

                  Is there a written contract? The worst-case scenario – unfortunately a very frequent one – is when the parties cooperate informally, only based on orders and order confirmations. This leaves undefined not only what happens in the case of imposition of duties, but also a whole range of other points, for example, limits on damages that can be claimed in the case of breach of contract, the duration of the agreement, the applicable law, and how any disputes will be resolved.

                  Another very problematic scenario is one in which contracts exist, but they are generic and do not include the necessary covenants to manage the risks involved in operating in a highly litigious market such as the U.S., which, moreover, has very high legal costs.

                  Having done this analysis, the necessary actions can be put in place, prioritizing according to the importance of business relationships and as appropriate:

                  • Negotiate and conclude a written contract from scratch
                  • Replace the existing agreement with a complete and correct contract
                  • Amend and integrate the existing agreement with pacts to manage tariffs and other causes of price fluctuations

                  Let us dwell on the last scenario, assuming that there is a complete and correct contract but one that does not regulate price and cost fluctuation as a direct or indirect consequence of the introduction of duties.

                  Contract Addendum

                  In such cases, the correct course of action is to sign an Addendum to the original contract, specifying which covenants are being waived and which covenants are being added. It is essential that the Addendum be negotiated and signed by persons with the power of representation of the parties and that it be drafted with the help of lawyers who specialize in this field. In addition to including correct clauses, it is necessary to verify that the covenants are valid according to the rules of law applicable to the contract.

                  Here are some clauses that can be the subject of the Addendum, to be modulated according to the specific case and possible scenarios.

                  Tariff Cost Sharing

                  By introducing this covenant, it is provided that in the event that duties are confirmed at [x]% or are reduced or increased within certain established thresholds, the Parties will share the increase equally, or according to other established percentages.

                  There may also be a ceiling on tariffs beyond which a party has the right to withdraw from the contract or request the suspension of certain orders for a specified period of time, after which it has the right to withdraw.

                  Price Adjustment

                  With this covenant, a discount or an increase in the product’s price is agreed upon, as the case may be, in the case of a duty greater than [x]%.

                  Among the use cases, in addition to that of the company exporting to the U.S. or other intermediate markets, with final destination of the products in the U.S., is that of those who purchase a product subject to import duty and resell it, processed or assembled.

                  Right to Cancel or Postpone Confirmed Orders

                  This covenant gives the right to revoke or suspend for a certain period already negotiated orders, as such binding, in case of confirmation or introduction of duties above a certain threshold, for example, if 20% taxation was confirmed for the import of wine from the EU.

                  The clause can be combined with previous covenants, for example, by stipulating that below the specified threshold, the contracts remain valid, and the parties share the duty or have the right to renegotiate the price.

                  Supply Forecast Adjustment

                  With this clause the Parties can modify supply programs already agreed for a specific duration (e.g., 24 months), with continuous sales and purchase obligations at a fixed price or indexable only within certain limits. The aim is to agree on the prerequisites for reshaping supply programs in the short and medium term, which can be very useful for defining the rules that will apply to relationships with key suppliers or customers for possible changes in volumes, delivery times, and prices.

                  Right to Source from Alternative Suppliers

                  This covenant serves to be authorized, if necessary, to source alternative suppliers of components or raw materials to those previously authorized in the contract with the end customer, for example, in cases where purchasing from the original suppliers has become too costly or difficult due to duties imposed at import or in previous steps in the supply chain, or other events such as currency or price fluctuation of certain commodities beyond a certain level established in the agreement.

                  Hardship and Force Majeure

                  The imposition of duties cannot be invoked as a cause of Force Majeure or hardship, respectively, to excuse contract non-performance or to renegotiate the price, even in cases of very high price increases (such as the 145% duty imposed on Chinese products). This conclusion is almost uniform under the law and jurisprudence of the major countries involved in the tariff war: U.S., China, Canada, Mexico, France and Italy: I refer to this practical guide for a timely examination of what the various rules provide.

                  If the contract lacks a well drafter Force Majeure and Hardship clause, or contains a generic clause, it is important to get your hands on revising it to expressly state the cases in which a party is entitled to suspend or terminate the contract, how and when to communicate the decision to invoke the exemption, and the consequences on the parties‘ contractual obligations. You can go deeper on this topic here.

                  Conclusion

                  It is essential to prepare for possible future scenarios regarding duties (confirmed, increased, changed, or decreased) and to determine the consequences on trade relations with foreign clients and suppliers: moving today, at a standstill (or nearly so), allows entrepreneurs to negotiate shared and fair solutions and to avoid, as far as possible, the emergence of tensions and conflicts with the various partners along the international supply chain.

                  Geraldo Fonseca

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