Businesses are happy to have a set of compliance criteria

	Tax and Customs policy dialogue with the business: Practice and efficiency
	Customs leads the administrative procedures group with low compliance costs
	Why the construction industry is leading the compliance costs?

Enterprises will be assessed according to four levels of high, medium, low compliance and non-compliance with customs regulations, regulations on tax and registered office. Picture: Nguyen Hue.

No more emotional evaluations

Speaking at the consultation workshop to get business opinion on the draft circular stipulating the criteria for assessing compliance and organizing the assessment of legal compliance of enterprises in the management of import and export activities, and transit of goods, that took place on 4^th of December, 2018, Deputy General Director of Customs, Hoang Viet Cuong, confirmed that the announcement of the criteria for compliance assessment and organization of legal compliance assessment for the first time in the management of export and import, transit of goods of the General Department of Customs, the "stream" business has become transparent. This criterion makes it impossible for the customs office to grasp facts, because every criterion is displayed on a spreadsheet and there are not any frauds in this case any longer.

In this draft, the Customs will publicly and widely publicize the criteria of compliance assessment, the level of legal compliance of enterprises operating in the field of import and export. Enterprises can look up the index on the system of risk information of the General Department of Customs updated at 0 hours daily. In addition, customs offices shall apply measures to check dossiers and conduct actual inspection of goods in customs procedures and results of customs clearance inspection, which shall be updated in the system on the same day.

Enterprises will be assessed according to four levels of high, medium, low compliance and non-compliance with customs regulations, regulations on tax and registered office.

Commenting on this draft, Mrs. Ta Thi Van Ha, Vietnam Association of Seafood Exporters and Producers (VASEP), said seafood enterprises are very happy because there is a clear set of criteria for businesses to know where you are and how you adhere, and no need to ask the customs office why my cargo is in the Blue - Yellow - Red stream. However, representatives of VASEP also worry that according to the criteria proposed by the draft, there are no seafood enterprises able to achieve levels 1, 2, 3. All seafood enterprises will only reach level 4 - the degree of non-compliance with customs law in import and export activities.

Actual analysis from enterprise’s issued export and import activities, she said that the cancellation of declarations under the draft circular, due to the fact in the purchase and sale activities that cancellation of customs declaration can’t be avoided because of the risk of canceling the order, delaying the purchase time, or damaging goods, the company must cancel the declaration. If the number of declaration cancellations that must have records checked, or actual inspection of goods is too large, after accounting for allowed percentage, no seafood enterprises will reach levels 1, 2 and even level 3.

Regarding the regulations for import goods that are refused when the customs declaration has been registered, Ms. Ha suggested that if goods owners could provide evidences on the goods which had been sent with a wrong agreement or fake name, whether they would respond to criteria for evaluation or not.

"We also suggest that in this Circular it is necessary to add criteria to inherit the law-abiding history of the enterprise, because it would be unfair for companies that comply well. Before the issuance, it is also necessary to have more practical assessment to not downgrade good companies. Besides, the Drafting Board should also have a rating scale for each criterion rather than just general criteria," she said.

There will be a roadmap to apply

Mr. Nguyen Van Son, Chairman of the Vietnam Association of Pesticides, said that the cancellation of customs declarations is unavoidable in import-export activities and depending on each branch; if the number of declarations is canceled into a criterion of compliance, it should be carefully considered and formulated for an appropriate assessment so as to not cause difficulties for enterprises.

At the conference, many representatives of small and micro enterprises also expressed concern that their businesses only expand from 50-60 customs declarations per year, so according to regulations will be classified as low-level 3 compliance, and asked whether it is fair to small and micro enterprises or not.

Answering the questions, Mr. Quach Dang Hoa, Director General of the Department of Risk Management (General Department of Customs), said that the view of the Drafting Committee is to build this index in a transparent manner. When enterprises look at this set of indicators, they can look up and know where they are right now. If scores are coded, enterprises will find it difficult to look up.

On the recommendations of representatives of VASEP, Mr. Hoa said that the drafting committee will review the mistakes that seafood companies have encountered in the past and adjust the set of indicators accordingly. "However, we also have to look very objectively if a business often cancels declarations, corrects declarations, and payment of goods, so we must look back on whether the capacity of compliance is good or not.”

At the same time, the drafting committee also received suggestions to supplement the history of compliance of enterprises because in fact there will be enterprises split or merged, so there will be specific cases in which split companies that have good performance will inherit the compliance history of the former enterprise.

Answering questions about mistakes in the process of making declarations, the director of the Risk Management Department said that the view of the Drafting Committee is that when assessing compliance, two factors must be looked at: one is the law (whether the enterprises violates the law or not), the second, the law complying capacity that is reflected in the process of operation, the time of operation of the enterprise, reflecting in the faults that enterprises created during the operation. In levels 1, 2, 3, enterprises comply, only at level 4 do they not comply, and even level 3 enterprises are still compliant. However, the drafting board will also record and split large enterprises with many declarations at levels under percentage, and how is percentage to be calculated for small businesses with less declarations? Correcting the declaration and not receiving the goods, the Drafting Board will study and recommend the direction remains the same, but in case if the business is reasonable, this will be evidence to reconsider.

According to deputy director general Hoang Viet Cuong, consideration should be given specifically to the criteria for repair and return of goods. In fact, there is a story that some enterprises are ranked in red level and the yellow level, they should cancel the declaration, but the cancellation also has many causes, it cannot be considered the same, so the study needs to be analyzed particularly.

Information collection will decide the results of compliance assessment

For enterprises that are concerned they will be in the low level group when the new regulations are applied, Deputy Director General Hoang Viet Cuong confirmed that the provisions in the draft circular are basically inherited rules, but considering the adjustment and supplementation according to international practices and the practical situation in Vietnam. "It means that the Circular of category 1 down category 4 does not have to be changed, so businesses can be completely assured in the process of implementation. Besides, there will also be a roadmap for applying to some groups, step by step, to avoid shocking enterprises," he stressed.