The US Commerce Department has found Vietnam guilty of dumping catfish on the US market in a preliminary ruling that could lead to penalty tariffs on Vietnamese imports if upheld by the US government.

Last week Hanoi warned that such a ruling would damage the bilateral relationship that has existed since the two countries signed a trade agreement a year ago. This is the first major dispute since the signing of that agreement.

The preliminary finding from the US Commerce Department was that Vietnamese catfish are being sold to US customers at less than a fair market price. If the government upholds the ruling, Vietnam could face tariffs of up to 64%, reported BBC Online.