Problems relating to Trade and Investment on Vietnam
9. Restrictive export/import trade, duty, and customs clearance |
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Issue |
Issue details |
Requests |
Reference |
| (1) High Import Duty | - The tariff rate is high at 10-25% for complete unit of clocks and watches and movements thereof. - GOV removed import restrictions on steel products under import licence as of the end December 2001. GOV, instead, shifted to imposing the high tariff rates. - While single function projector (being an ITA Product) attracts zero import duty, in some countries, multi- function projector is dutiable at high rate of import duty. - While Japan-Vietnam Economic Partnership Agreement has been ratified, Japanese Lowe Glass, classified under HS 700510 and HS 900090 remains dutiable at the rate of 30%. |
- It is requested that GOV reduces the tariff ahead of the schedule. - It is requested that GOJ: -- takes action for solution of the problem, -- ascertains the latest information for expansion of the scope of products subject to ITA, and -- provides information continuously on the future trends worldwide. - It is requested that GOV reduces or repeals the Customs Duty. |
- Customs Law |
| (Action) - Law on Export - Import Tax stipulates certain products that are duty exempt such as raw materials, spare parts, and semi-finished products that are imported into Vietnam for the purpose of manufacturing the items of products under the project included in the List of Encouraged Investment Sectors. Accordingly, based on the Lists of commodities (from time to time adjusted) attached to Decision No.827/2006/QD-BKH (Decision 827), "Enterprises and competent authority consider eligibility for duty-exempted treatment". Where commodities not listed in Decision 827 nevertheless correspond to the commodities expressly identified in VAT Law and Law on Export-Import, the import duty and VAT is exempted on the imported commodities in concern. Decision 827 also provides in the course of using the lists, if customs offices' opinions are different from those of enterprises, the customs offices shall coordinate with the provincial/municipal Planning and Investment Services in considering and handling such difference. If there remain any unsolved problems, Vietnam Customs shall propose the Ministry of Planning and Investment to consider and make decisions or amend and/or supplement the lists. - MOF promulgated Decision No. 26/2007/QD-BTC (Decision 26) of April 16, 2007, promulgating Vietnam's particularly preferential import tariff for the implementation of the ASEAN-China Free Trade Area, by virtue of which imported goods satisfying the following conditions will be subject to application of the special preferential import tariffs: -- Goods are included in the tariff schedules, -- Goods are imported from the ASEAN Member States and PRC, -- Goods are directly exported to Vietnam, and -- Goods are accompanied by country of origin certificate issued by the competent authority of the originating country. - MOF promulgated on 31 May 2007 Decision No. 41/2007/QD-BTC (Decision 41), "Promulgating Vietnam's Particularly Preferential Import Tariff for Implementation of ASEAN-Korea Free Trade Area" by virtue of which imported goods satisfying the following conditions will be subject to application of the special preferential import tariffs. Further, subject to meeting certain conditions, AKFTA tariff rates apply to imports from Kaesong Industrial Park (North Korea): --Goods are included in the Tariff Schedules, --Goods are imported from the ASEAN Member States and ROK, --Goods are directly exported to Vietnam, and --Goods are accompanied by Country of Origin Certificate issued by the competent authority of the originating country. - Under the AJCEP, tariffs are evenly reduced in each year and will be completely repealed after 16-years. While the move toward repeal is welcome, it takes too long for the complete repeal. - On 27 February 2009, MOF amended the tariff rates for vehicle parts (HS8404, 8408, 8409, and 8708). - On 13 April 2009, MOF raised the import tariff rate for certain alloy steel to 10%, which is the WTO Concession Rate. Moreover, on 26 March 2009, GOV amended the import tariff rates on steel products (HS7207, 7209, 7210, 7214, 7215, 7217, and 7306). - Under the Japan-Vietnam EPA enforced in October 2009, the tariffs on Japanese watches have been reduced evenly in stages, while import duty on watches and clocks will be completely repealed after 10-years, while tariffs on movements and parts will be repealed after 15- years, which, while appreciated, is too long. - GOV announced its intention to accede to TPP with the high liberalisation rate of 100%, sometime in future as associate member. - In March 2010, GOV agreed to enter into negotiation with EU on FTA. - On 25 March 2011, the Ministry of Industry and Trade (MOIT) promulgated Decision No. 1380/QD-BCT on adjustments based on the List of Discouraged Import Items immediately enforced on the same date. This List encompasses a wide range of products including HS Chapters 73, 84, 85, 87, 90, and 91, such as certain steel made household products (such as stove, scrub brush, hygienic porcelain, etc.), laundry machine, computer, electric appliance, camera, cassette tape recorder, record player, golf cart, passenger car (excluding small trucks), motorcycle, bicycle, stand clock, wrist watch, etc. Products used for production materials are excluded from this List. While this measure is not intended to build up import barriers for the listed items, GOV attempts at restricting their imports by directing State Bank of Vietnam (SBV) to make it difficult for importers through commercial banks (CMBs) to purchase foreign currency to import the listed items in its Official Dispatch No. 3215/NHNN-CSTT of 29 April 2010. SBV directs CMBs to carefully examine the request for loan in foreign exchange, severely control, and restrict such loan. Furthermore, by Decision No. 2677/QD-NHNN of 20 November 2010, SBV established an Inter-Department Working Group for monitoring the sale and lending for payment of imported goods, while tightening lending and payment in foreign currencies services. Working Group shall be responsible for monitoring and reporting to the Governor on a daily basis the situation of sale, lending and remittance by credit institutions for payment of imported goods in connection with the list of non-essential imported goods items (under Decision 1899/QD-BCT of MOIT) and the list of essential goods items manufactured locally (under Decision No. 2840/QD-BCT of MOIT of 28 May 2010). SBV does not envisage reducing the MFN tariff rate on the listed items in the near future. - On 2 February 2016, GOV signed trans pacific partnership agreement. |
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| (Improvement) - On 1 December 2008, ASEAN-Japan Comprehensive Economic Partnership (AJCEP) came into force, whereby GOV immediately repealed tariffs on 2,911 items out of the 11,397 items on the list of tariff concessionary rates. Excluded from the tariff reduction are 1,164 items, while 35,817 items are related to transport machineries and equipment. It is said that the tariff rates for 103 items are more favourable under AJCEP compared to those of AFTA CEPT. - Japan-Vietnam Economic Partnership Agreement signed on 25 December 2008 has become effective since 1 October 2009. The tariff reduction schedule on the part of Vietnam is:- out of the total of 9,300 items, tariffs were immediately removed on 2,586 items, while on 5,873 items, tariffs are reduced in stages until 2025 when they are totally repealed, along with the other 89 items. In terms of amount, 88% will be liberalised within 10-years. - On 28 April 2009, MOF announced the Vietnam's import tariff reduction schedules under AJCEP during 2008 through 2012. |
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| (2) Raise in Import Duty | - GOV's repeated tariff increases have disrupted the distribution: -- On 1 April 2009: GOV raised the tariff on billet: 5%=>8%, construction steel bars: 12%=>15%, CR: 7%=>8%, plated sheet steel: 12%=>13%. -- On 20 April 2009: GOV raised the tariff on boron-added steel bar: 0%=>10% -- In February 2010: GOV raised the tariff on steel bar, wire rod (in part): 5%=>15%, Tin plate 3%=>5%. -- Since 25 August 2011, MFN tariff rate has been raised from 0% to 10% on the boron added Other Alloy steel sheet, wire rod, and shaped steel (HS7225, 7226, 7227, and 7228 however, excluding hot-rolled steel sheet). -- On 11 June 2012: MFN tariff rate has been raised from 0% to 10% on the Stainless Steel Bar (in part). -- On 1 January 2013: MFN tariff rate has been raised from 5% to 10% on the cold rolled steel sheet & welded steel pipe (in part). -- On 19 May 2013: MFN Tariff Rate has been raised from 0% to 3% on wire (in part). -- On 1 January 2014: MFN tariff rate has been raised on steel sheet, shape steel, etc. |
- It is requested that GOV reduces tariff rates. | |
| (Action) '- Since 23 March 2009, Ministry of Finance (MOF) have adjusted export/import duty rates for certain coal products so that 5% of import duty and 10% of export duty apply to HS4402.10.00.00 and HS4402.90.00.90 coal products, and 5% export duty to HS4402.90.00.10 coal products. - On 7 July 2013, Ministry of Finance raised export tax to 13% on HS4402.90.00.10 and HS4402.90.00.90 coal products. - On 1 September 2013, GOV raised export duty from 9.1 to 10%, by the request of Vietnamese coal industries. - On 20 May 2013, GOV announced import tariff rates hike on petroleum products (gasoline 16%=>19%, diesel oil 12%=>14%, low quality burning oil 14%=>15%). - On 20 June 2013, GOV effected hike in import tariff rates on motor vehicles seating more than 9-Persons (under 1000 cc USD 4,200=>USD5,000, 1000cc-1500 cc USD9,600=>USD10,000. |
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| (Improvement) - Pursuant to "The list of products and Vietnam's special preferential import duty rates", preferential import duty rates are expressly stated for the set of automotive parts in CKD format (for full local assembly) along with the import tariff rates for each automotive parts and spare parts. Enterprises engaged in manufacture and assembly of automotive vehicles have until 31 December 2006 to choose either the preferential import tariff rates for the set of automotive parts in CKD format or for each automotive parts and spare parts. Since 1 January 2007, the preferential import tariff rates expressly stated in the Decision 39 for each automotive parts and spare parts are uniformly applied and the preferential import tariff rates expressly stated in Decision 39 for the set of automotive parts in CKD format do not apply. Enterprises entitled to choose either the preferential import tariff rates for the set of automotive parts in CKD format or for each automotive parts and spare parts may register themselves in writing with the convenient local authority and must observe the registered details during the entire period. - With Vietnam's accession to WTO, the import tariff rates on 4-wheel automotive vehicles are reduced in the range of 47-70% in 11 years commensurate with the engine disbursement from the going tariff rate of 90%. - Since February 15, 2009, MOF has reduced export duty on coal and related products from 20% to 10%. |
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| (3) Fairly Expensive Knock Down Parts Import Tariff Rates | - Customs levied CBU (completely built unit) import tariff rate of finished products. - Import tariff on cars: auto engine CBU 0% on knockdown 5% (disadvantageous to local production) |
- It is requested that GOV reviews import tariff rates. | - Circular 05/2012/TT-BKHCN by MOST - Circular 19/2006/TT-BTC by MOF - Circular 165/2014/TT-BTC by MOF |
| (4) High Rate of Export Tax | - GOV imposes 10% export tax on export of coal, pushing up the market price. | - It is requested that GOV repeals as soon as possible the export tax on coal that causes the constant rise in the market price. | |
| (Action) - Since 23 March 2009, Ministry of Finance (MOF) have adjusted export/import duty rates for certain coal products so that 5% of import duty and 10% of export duty apply to HS4402.10.00.00 and HS4402.90.00.90 coal products, and 5% export duty to HS4402.90.00.10 coal products. - MOF, after raising to 13% in July export tariff on coal products HS4402.10.00.00 and HS4402.90.00.10, from 1 September 2013, reduced it to 10%, in response to coal export industry's request. - On 12 February 2015, MOF banned export of dust coal. - On 25 May 2015, MOF lifted export ban limited to 2015 only, in response to request from Japan. - Since January 2016, export ban continues. |
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| (Improvement) - Since 15 February 2009, MOF has reduced export tax from 20% to 10% on coal and related products. |
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| (5) Arbitrary Change in Application of HS Code Commodity Confirmation | - The competent customs authority of MFS in Bac Ninh Factory (new factory operating from June 2013) changed HS code for 4805 kraft paper & paperboard for corrugated board (at 10% customs duty), imported up to now from Taiwan, to 4804 paper & paperboard (at 15% customs duty) on the ground that the former is greater in strength (tensile or otherwise). As a result, competent customs authority levies different customs duty rates on the same products manufactured in MFS's Bac Ninh and Hai Phong factories. | - It is requested that GOV: -- honours the internationally accepted practice of determining the customs duty rates by the mixture percentage of used papers, and -- refrains from raising the applicable customs duty rates merely by the quality. |
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| (Action) - On 15 August 2013, MOF renewed classification master list for tariff items in implementing Article 17 (list of Vietnam import/export items) of the Decree guiding implementation of the new 2014 customs act (for enforcement from 15 August 2015). |
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| (6) Import Restriction by Designated Trade Enterprise Scheme | - MOIT maintains a system whereby only the enterprises designated by MOIT are authorised to apply for import licence and import goods. (Steel products are included in this scheme.) | - It is requested that GOV repeals or deregulates the scheme. | |
| (Action) - On 20 May 2010, MITI promulgated Circular No. 22/2010/TT-BCT Hanoi, setting forth the application of automatic import licenses to flat-rolled products of iron or non-alloy steel, and on 28 May 2010, Circular No. 24/2010/TT-BCT, setting forth the application of regulations on automatic import licensing to animal products, foods, cosmetics, plastics, clothing, footwear, ceramic and earthenware, glass, iron and steel, aluminium, machineries, electric appliances, cars, toys, and furniture. Circular No.22 enforced on 5 July 2010 is valid until 31 December 2010, while Circular No. 24 was enforced on 12 July 2010. Applicants for import licence under automatic route must be registered trader. For registration, the followings are required: (1) Registration dossier signed by the licensing agency, (2) Copies of Business Registration Certificate or Investment/Business Licence Certificate, and (3) A copy of tax registration certificate. To file application for automatic licence, the followings are required: (1) A full set of application dossiers, (2) Import contract, (3) Commercial invoice, (4) Letters of credit, payment deed or bank payment certificate, and (5) Cargo shipping documents including bills of lading (B/L). |
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| (7) Compulsory Acquisition of Import Licence (I/L) on Steel Products | - On 5 July 2010, GOV promulgated a rule compelling acquisition of import licence (I/L) on import of cold-rolled steel plate and wire rod, up to the end of December 2010. - On 9 September 2010, GOV likewise promulgated a rule compelling acquisition I/L on import of galvanised steel plate, aluminium-zinc plated steel plate, coloured galvanised steel plate and tin plate, up to the end of December 2010. - On 14 February 2011, GOV postponed the limited period measures for acquisition of I/L on import of the foregoing steel products to the end of December 2010 to "from 14 February 2011 to 31 December 2011". - On 20 September 2012, list of items subject to compulsory import licence acquisition newly added steel bar, stainless steel plate and welded steel pipe (Import HS code Nos. 7214/7215, 7219, 7220, and 7306). |
- It is requested that GOV expedites issuance of I/L as any delay means increased warehousing cost and lost business opportunities to importers. | - Decision of the Prime Minister No.41/2005/QD-TTg Hanoi, 2 March 2005 Promulgating the Regulation on Goods Import Licensing - Ministry of Industry and Trade Circulars: No. 22/2010/TT-BCT No. 31/2010/TT-BCT No. 42/2010/TT-BCT No. 23/2012/TT-BCT |
| (Action) - On 7 August 2012, MOIT promulgated Circular 23/2012/TT-BCT, prescribing the application of automatic import licences to certain steel products with effect from 20 September 2012. Goods subject to the licences are: HS code 7209, 7210-7212: iron or non-alloy steel flat roll products, HS code 7213-7215: iron or non-alloy steel bar, HS code 7219, 7220: flat-rolled stainless steel products and HS code 7306: other tubes, pipes and hollow profiles (for example, open seam or welded, riveted or similarly closed), of iron or steel. - On 12 June 2015, MoIT promulgated Circular 12/2015/TT-BCT, with effect from 26 July 2015. goods subject to the licences are: HS code 7207, 7209, 7210, 7211, 7212, 7213, 7214, 7215, 7219, 7220, 7224.7227, 7228, 7229, 7306, excluding, however, temporary export/import or import for the purposes of manufacture and processing. - On 26 July 2015, import licence acquisition requirement on iron and steel products import, once notified as repealed in the official gazette of 16 June 2014, was re-introduced. - On 7 March 2016, Ministry of Industry and Trade (MIT) announced its Decision (MIT Decision 862/QD-BCT) to invoke safeguard measures on steel ingots and long steel products, etc. imported into Vietnam (during 22 March through 7 October 2016). |
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| (8) Restricted Export by FFEs to 3rd Countries of Products Procured from Overseas | - Member firm's subsidiary (MFS) in Vietnam, when contracting with Myanmar / Cambodia enterprises (MCEs), may sell (export) to MCEs products originating in Vietnam, but may not sell (drop ship) products originating from 3rd countries such as Japan. This type of transaction is possible if sellers are Vietnamese enterprises, but it is closed to foreign funded enterprises. | - It is requested that GOV authorises MFS's export of finished products procured from 3rd countries for the sake of furthering the Vietnamese advantageous position in the ASEAN member states. | |
| (9) Disapproval of Triangular Trade in Foreign Trade Registration | - Inclusion of triangular trade business is disallowed in foreign trade registration by foreign funded enterprises (FFEs), in addition to manufacturing and import/export businesses. | - It is requested that GOV authorises triangular trade business also to FFEs in their line of business. | - KPMG LLP (the Audit, Tax and Advisory Firm) Information, concerning the registration of the change in the Articles of Association (Incorporation) of a Vietnamese legal entity |
| (10) Tightened Import Restrictions on Used Machinery, Equipment and Production Line (UMEPs) | - In regard to MoST Circular No. 20 issued in July 2014, while it was decided to suspend its effect until 1 March 2015, it appears both the limit on the service years and the quality warranty provisions remain in the draft amendment circular. If the restrictions on the service years remain as drafted, it will be no longer possible to import good and economical UMEPs, compelling numerous factories to amend their production plan. - Ministry of science and technology (MoST) in July 2014 promulgated Circular No.20 (20/014/TT-BKHCN), that allows import of used machineries and equipment with using time of less than 5-years from the manufacturing date and remaining quality of 80% or more (enforced on 1 September 2004). It was triggered by the closure of approx. 2000-firms in PRC from the use of inefficient and outdated manufacturing machineries and technologies. MoST was afraid of the flood into Vietnam of these kinds of old-fashioned contraptions brought into Vietnam in huge quantities from PRC. MoST was concerned with the negative impact on the domestic industrial efficiency. "The remaining quality of 80% or more" means "almost new" to both enterprises contemplating entry into Vietnam and those already operate in Vietnam. Some of them would be compelled to retreat from Vietnam from the aggravated break-even point. MoST Minister by Decision No.2279/QD-BKHCN promulgated on 1 September 2014 has suspended the validity of Circular No.20 (20/014/TT-BKHCN). However, using time of less than 5-years still remains, giving negative impact upon existing enterprises and those considering investment into Vietnam. - Concerning import of UMEPL, MoST Circular compels from September 2014 service length of no longer than 5-years, or remaining quality of 80% or higher. However, by petition, its implementation was postponed. As of now, deliberation continues on extension until 1 December 2015, and remaining quality of 70% or higher at the end of 10th year. - According to the relevant MoST Circular, Major UMEPL that may be imported into Vietnam must have service length of no longer than 5 years, and remaining quality of 80% or higher. However, due to numerous ambiguities concerning the documents for submission to customs, and the rules concerning the testing institutions, it is impossible to prepare practical work. In transfer of production from Japanese factories to Vietnam, expanded production in Vietnam cannot be achieved, unless GOV allows import of UMEPL used in the Japanese factories. - "Circular regulations on the importation of used machinery, equipment and production line" remains pending implementation. However, it prohibits import of UMEPL with service length of less than 5-years, or remaining quality of 80%. However, quite a few UMEPLs made in Japan, of course, and in third countries can be used for many years. Thoughtless prohibition of such imports is harmful to entry and expansion of businesses. - Circular was promulgated, prohibiting import of UMEPL other than those that satisfy "service length of no longer than 5-years, or remaining quality of 80% or higher requirements" (later annulled) This could result in subsequent difficulty UMEPL procurement. - On import of UMEPL, while by MoST Circular, service length of no longer than 5 years, or remaining quality of 80% or higher requirements have come to apply, by petition, its implementation has been deferred. As of now, "postponement until 1 December 2015, and service length of no longer than 5 years, or remaining quality of 80% or higher requirements" are under deliberation. - (Problems facing enterprises moving in to a member firm's industrial zone) due to the new Circular, sub-standard UMEPL cannot be imported any longer. |
- It is requested that GOV repeals the restrictions on service length. - Implementation of this law obstructs Japanese SMEs' / downstream industries' transfer of production and could result in reduced investment into Vietnam. It is requested that GOV repeals at least service length restrictions. - It is requested that GOV ensures preparation of reasonable implementing rules, complete with an ample period allowed for penetration, such as permissible terms concerning proviso for remaining quality, before starting the implementation. - It is requested that GOV deregulates the legislative requirement and reopen implementation, enabling the use of UMEPL by satisfaction of either requirement. - It is requested that GOV repeals the restrictions. - Enforcement of this Circular deters Japanese SMEs transfer of their production to Vietnam, and results in reduced investment into Vietnam. At least removal of service length is requested. - It is requested that GOV repeals the restrictions. |
- Circular No. 20/2014/TT-BKHCN Ministry of Science and Technology on the Import of Used Machinery, Equipment and Production Line 15/07/2014 |
| (Action) - On 9 August 2013, the Prime Minister promulgated Indication 17/CT-TTG, on "Strengthening Management and Control over the Import of Technologies, Machinery and Equipment by Enterprises". Enterprises upon filing application for investment certificate, should there be plan for importing machinery and equipment for use in business activity, must submit manual giving technical parameters and performance characteristics. - On 9 July 2014, Ministry of Science and Technology (MST), Vietnam promulgated Circular No.20 dated 15 July 2014 (due for enforcement on 1 September 2014), stipulating the new requirements for importing used machineries and equipment, aimed at curbing the inflow from PRC of old-type machineries and equipment. --MST Notification No. 20 (In Vietnamese) (http://www.customs.gov.vn/Lists/VanBanPhapLuat/ViewDetails.aspx?ID=7704) - On 15 July 2014, MST promulgated Circular No. 20/2014/TT-BKHCN. Regulations for used machinery, equipment and technological line imports, requiring the service years within 5-years and the quality level of 80% or more of the new products, on imported used machineries and equipment (of general purpose) - On 15 July, MoST promulgated Circular No. 20/2014/TT-BCT, (on importation of used machinery, equipment and production line, due for enforcement on 1 September 2014), with additional requirements of service length of no longer than 5 years, or remaining quality of 80% or higher. While enforcement was due on 1 September 2014, petition for its extension is now under way. MoST to this date verbally expressed its intent of enforcement on 1st March this year. First draft amendment was formulated in November last year, and after hearing views from related ministries and agencies, 2nd draft was formulated as of 15 January 2016. [Contents of 2nd Draft] THE GIST OF THE LATEST DRAFT: Enforcement: 1 December 2015. Import terms: service length of no longer than 10 years, and remaining quality of 70%. SPECIAL CONDITIONS: -- Machining tools (HS84.56-HS84.66): country of origin (EU/G8): 12 years, 70%. -- Construction machine: country of origin (EU/G8/ROK): 12 years, 70% or higher. -- Paper mill/textile mill machines (HS84.39, HS84.41-HS84.54): country of origin (EU/G8/ROK): 12 years, 70%. -- Agricultural machines: service length of 5 years, and remaining quality of 80%. -- Production line: service length of no longer than 10 years, and remaining quality of 70%. Special condition for production line: in the cases of EU, G8, ROK: service length in excess of 10-years requires filing of request to MoST for approval. -- Parts: approval is granted, if the parts are incapable of local production, and remaining quality is 70% or higher. - On 29 August 2014, enforcement of MoST Circular No. 20/2014/TT-BKHCN was terminated and replaced by MoST Minister's Decision No. 2279/QD-BKHCN, having met with strong oppositions from the domestic industries, etc. - MoST released draft amendment for the lapsed "Circular 20/2014/TT-BKHCN (Circular No.20) on the import of used machinery, equipment and Production Line." - On 13 November 2015, MoST Circular 23/2015/TT-BKHCN was promulgated, due for enforcement from 1 July 2016. 1. Used equipment shall be eligible for import if satisfying the following criteria: (1) Use of equipment shall not exceed 10 years (the period from manufacture to arrival at Vietnam port). (2) Equipment manufactured up to the national technical regulations (QCVN) or national standards (TCVN) or G7 nations' standards on safety, energy efficiency and environmental protection. 2. Used equipment released from investment projects, including both new and extending projects, under the following circumstances: a) Projects in the approved list for investment; b) Projects to be granted investment certificate but not in the approved list for investment. If a list of used equipment is included in the investment project documents and approved by relevant authorities, such project is not subject to regulations stated in 1. above. |
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| (Improvement) - New Circular promulgated on 13 November 2015 concerning the import of used machinery, equipment and production line enables import of used equipment within 10 years in age, satisfying the quality standards. In addition, authenticated copy of the investment policy decision or certificate of investment issued by the authority of competent jurisdiction suffices in the event of new or expansion investment project. |
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| (11) Vexatiously Complex and Delayed Customs Clearance Procedures | - It takes substantial amount of time to get the imported goods cleared through customs. - Import customs clearance procedures are indeed time consuming, what with quality inspection and customs requirement for production of voluminous documents both of which take a long time to check and confirm. (Sometimes, it even takes more than one month). - Investigation process after customs clearance is so complex that plural Ministries and Agencies conduct investigation into our member firm's subsidiary (MFS) on the same issue. - All concerned parties cannot help wondering why there exist so many documents, requiring individual signatures and company seals. Frequently, expedited response cannot be obtained from the competent authority. - Vietnam Customs headquarters are in charge of issuing import licence for used equipment. It takes about one month for compilation of the requisite documents and despatch of the used equipment to Vietnam. In addition, new equipment can reach Vietnam in 10-days or so, and the shipper's inability to ship both used and new equipment together results in doubling the transportation cost. |
- It is requested that GOV streamlines the customs clearance procedures. - It is requested that GOV streamlines and expedites its inspection and confirmation of documents. - It is requested that each Ministry and Agency will commonly share the submitted information. - It makes one wonder where has gone the electronic customs clearance system. There is no sign of reduction in volume of the requisite documents. It is requested that GOV streamlines and expedites the documental processing. - It is requested that that GOV: -- reviews the import restrictions on used equipment, and -- cuts down the time required to complete the import process in Vietnam. |
- Article 144, Circular No. 79/2009/TT-BTC |
| (Action) - On 12 December 2008, MOIT promulgated its Circular, compelling the AILS on consumer goods, extending broadly over a wide range of items, including certain vehicles, motorcycles, desk top and lap top computers, cameras and video cameras, audio equipment, home appliances, equipment/products, cosmetics and cosmetic goods, and furniture. The new requirements came into force within 21 days from the date of publication. All AILS's issued prior to 1 January 2009 accompanying the contents approvals would thereafter remain valid and effective. - On 20 May 2010, MITI promulgated Circular No. 22/2010/TT-BCT setting forth the application of automatic import licenses to flat-rolled products and bars of iron or non-alloy steel (HS 7209, 7211 and 7213). - On 28 May 2010, MITI promulgated Circular No. 24/2010/TT-BCT, setting forth the application of regulations on automatic import licensing to animal products, foods, cosmetics, plastics, clothing, footwear, ceramic and earthenware, glass, iron and steel, aluminium, machineries, electric appliances, cars, toys, and furniture. - On 14 June 2010, Ministry of Industry and Trade, Ministry of Transport and Ministry of Finance promulgated Joint Circular No. 25/2010/TTLT-BCT- BGTVT-BTC, providing the import of Brand-New under 16-seat Passenger Cars (BNPC), designating the 5-international seaport border gates (Cai Lan - Quang Ninh, Hai Phong, Da Nang. HoChi Minh City and Ba Ria - Vung Tau) for import of BNPC. - MOIT Circular No.20 (20/2011/TT-BTC) of 12 May 2011 additionally requires importers of finished cars (CBU) submission of assignment documents between importing automobile manufacturers and dealers as additional requisite documents upon importers of finished cars (CBU), inclusive of the import contracts dated on and after 12 May 2011. - On 1 April 2014, General Department of Vietnam Customs (GDVC) announced formal implementation of Vietnam Automated Cargo and Port Consolidated System and the Vietnamese Customs Information System (VNACCS/VCIS) at Hanoi and Hai Phong Customs Departments. The spread of its implementation will reach all across provinces and municipalities by June this year. "VNACCS/VCIS" (Vietnam Automated Cargo and Port Consolidated System and the Vietnam Customs Information System) is an automated customs cargo information processing system, designed after the Nippon Automated Cargo and Port Consolidated System and the information system. -- GDVC Official Press Release of 1 April 2014 [in Vietnamese] (http://www.customs.gov.vn/Lists/TinHoatDong/ViewDetails.aspx?ID=20840&Category=Tin%20n?i%20b?t) - In March 2015, Ministry of Science and Technology (MoST) promulgated draft amendment on (Circular No.20) Regulation 20/20/2014/TT-BKHCN on the import of used machinery, equipment and production line (UMEPL), which had ceased its effect by the Industry's opposition. It is due for be enforced from 1 July 2015. - On 15 July 2015, Ministry of transport promulgated Circular No.17/2015/TT-BGTVT, providing guidance on routes and border gate for transport of transit goods that pass through the territory of Vietnam (due for enforcement from 15 July 2015). |
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| (Improvement) - On 26 June 2001 the National Assembly approved Customs Law 29/2001/QH to improve and facilitate customs clearance procedures. This new law comprises of 8 Chapters and 82 Articles and includes provisions such as: (1) exempting inspection upon export/import for enterprises with proven records of observing customs regulations and; (2) executing inspection on the raw materials imported, representing only 10% of their value. - Effective as of 4 September 2002, GDC was merged into the Ministry of Finance, pursuant to Decision 113-2002-QD-TTg. The Government Pricing Committee was merged into the Ministry of Finance pursuant to Decision No.113-2002-QD-TTG on 19 September 2002. - On 20 June 2005, GOV promulgated Decision No. 149/2005/QD-TTg on the pilot implementation of e-customs procedures with objectives (1) to implement step-by-step renewal of customs operations in conformity with modern customs standards in the region and the world and (2) to shift from manual customs procedures to e-customs procedures. Decision 149 requires exporters/importers to archive the documentations concerning e-customs related to import or export goods for duration of five years counting from the date of registration of customs declarations and to produce such documentations when so requested by customs offices according to regulations. - 15 December 2005, GOV promulgated Decree No. 154/2005/ND-CP (Decree 154), "Providing detailed guidelines for implementing provisions referring to customs procedures and customs control and inspection in the customs law", which replaces Decree No.101 and Decree No.102 and have been enforced since 1 January 2005. The following export and import goods are subject to customs procedures and customs control and inspection under this Decree: 1. Export/import goods and goods in transit, 2. Goods in transit, upon embarkation and entry, and 3. Foreign currencies, Vietnamese currency, precious metals, Jewelleries, cultural goods, relics, postal goods, parcels, 4. Accompanied goods of exiting and entering persons, and 5. Other export/import goods in transit or in store within the jurisdiction of customs office. - On 4 April 2007, MOT promulgated Circular No.04/2007/TT-BTM (Circular 04), "Guiding import, export, processing activities, the liquidation of import goods and the consumption of products of foreign-invested enterprises, detailing and guiding the implementation of a number of articles of the Investment Law". Circular 04 has voided the requirement for import plan/approval on tariff exempt imports. With enforcement of Circular 04, Foreign Invested Enterprises have rights to freely import machinery, equipment, materials, spare parts, components, detail components and other goods to carry out the investment activities in conformity with the targets of investment projects defined in the Investment Licences or Investment Certificates, excluding, however, import of the commodities that requires licence of the relevant supervising authorities for industrial control, or import of the banned commodities. - GOV on 7 June 2007 promulgated Decree No: 97/2007/ND-CP (Decree 97), "Providing for the handling of administrative violations and the coercive enforcement of administrative decisions in the customs domain", which has been in force since 1 July 2007, in lieu of Decree 138/2004/ND-CP (Decree 138) promulgated on 17 June 2004. Furthermore, MOF promulgated on 14 June 2007 and enforced on 1 July 2007 Circular No. 62/2007/TT-BTC (Circular 62), "Guiding the implementation of the Government's Decree 97", replacing Decree 138. - MOF on 6 August 2007 promulgated Decision No. 71/2007/QD-BTC (Decision 71), "On non-stamping of 16 imported goods items". - The General Department of Customs of Vietnam (GDC) promulgated on 9 August 2007 Official Letter 4537/TCHQ-KTTT that further clarifies the registration procedure for the list of imported commodities subject to import tariff exemption on the cases authorized up to 31 December 2005 and after 1 January 2006. - On 14 July 2009, GDC promulgated Official Letter No.4190/TCHQ-KTTT (OL) in order to provide a more detailed explanation on issues concerning valuation of import products at customs clearance. The OL points out several significant issues that companies should pay attention to, of which the ruling underlines the use of customs database and other sources to reach proper customs value of imported goods. - As regards Vietnam Automated Cargo and Port Consolidated System and the Vietnamese Customs Information System (VNACCS/VCIS) due for operation from April 2014, GOV announced its State-wide introduction schedule in stages beginning with North Hanoi and Hai Phong No.1 branches of the Customs Department. By late June, the introduction of VNACCS/VCIS will be completed under the schedule. - On 1 January 2015, GOV promulgated Decree No. 08/2015/ND-CP on priority given to enterprises, pre-determination of code, origin and customs value, customs electronic data processing system, customs procedures, customs supervision and (post clearance) inspection processes for exports, etc. - On 8 September 2015, customs formally initiated implementation of national single-window system. |
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| (12) Complex Product Registration Procedures | - The procedures are complex for product registration in import and distribution of medical equipment. | - It is requested that GOV: -- abolishes the renewal procedures for the product registration, and -- obviates the need for the registration renewal, once the product is registered as in Japan, etc. |
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| (13) Improper Cap on Import Duty Exemption | - Allowable tax exemption (ATX) is up to USD300 only, so that virtually all imports are taxable. | - It is requested that GOV considers adjusting the ATX to an adequate level. | |
| (14) Frequently amended and nebulous Customs Clearance Procedures and Scheme | - The customs authorities frequently change customs clearance procedures and schemes, most of them without notification that serves as guidelines to the implementing authority. It consumes much time for handling clerical matters upon amendment. Sometimes, the contents of amendment are nebulous. | - It is requested that before enforcing new legislation or new system, GOV: -- completes thorough preparation, including without limitation, prior disclosure, notification, etc. on new legislation or amendment, and -- introduces a new scheme that grants a simplified procedures to enterprises of good standing with clean past records in observance of laws and regulations. |
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| (15) Identifying the Requisite Documents for Customs Clearance & structuring the means for Price Leakage Prevention | - In on-the-spot export/import transactions (where commodities move directly between the 2-domestic parties, while the flow of the transactions (documents) goes via an overseas enterprise (OE), upon import customs clearance when customs declaration sheet becomes necessary, the OE's purchase prices of the products get leaked out to the purchaser. | - It is requested that GOV clearly identifies the requisite documents for customs clearance (RDCC), and takes step to avoid the purchase price leakage to OE by re-arrangement of RDCC. | |
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