General Department of Customs points out tricks of origin fraud and forgery

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Converse shoes in a container of goods from China to Hai Phong port labelled "Made in USA". The shipment was seized by Hai Phong Customs in 2017. Photo: Thai Binh

Sophisticated tricks on goods labels

Notably, regarding labelling and infringement of intellectual property rights, the General Department of Customs found many cases of foreign-made goods labelled “Made in Vietnam” or “Manufactured in Vietnam, “Originated from Vietnam” when importing to Vietnam or information on trademark, manufacturing establishment, website, warranty centre on products and/or product packaging, warranty card are shown in Vietnamese language

In addition, goods imported from a foreign country with a label showing foreign origin and manufacturer/ or failing to show country of origin but will be labelled with “Made in Vietnam” or “Manufactured in Vietnam, “Originated from Vietnam” for consumption in the Vietnamese market.

Traders have taken advantage of legal documents on not requiring sub-labels at customs clearance to import goods and then do not attach sub-labels but change labels, packages and the names of goods for domestic consumption.

In the field of labelling, infringement of intellectual property rights, the General Department of Customs also discovered imports of goods with counterfeit registered trademark for protection of intellectual property rights; or taking advantage of the transit to transport counterfeit goods, infringing intellectual property rights or forging Vietnamese origin.

Origin fraud to enjoy tax incentives

The General Department of Customs has detected many tricks of origin fraud and forgery. To enjoy special preferential tax rates under free trade agreements, importers used fake or invalid C/O to carry out customs procedures or declare false information on C/O such as regional value content (RVC), Change in Tariff Classification (CTC) ; information about person named in box 1 (for C/O form E) or information about invoices in box 10.

For Vietnamese exports, Vietnamese enterprises (including FDI enterprises) import raw materials, semi-finished products, components and spare parts for production, processing and assembly but the imported goods do not undergo processing and manufacturing stages or undergo simple processing, manufacturing and assembling stages that do not meet the origin criteria prescribed but they are labelled with Vietnamese origin or declared Vietnamese origin on Customs declaration upon exports or have dossier to be legalised to apply for a certificate of Vietnamese origin.

In particular, traders take advantage of the establishment of many companies to import components, spare parts or disassembled parts for assembling or selling to other companies to perform simple processing and assembly, failing to meet the required origin criteria but printed with “Manufactured in Vietnam” or “Originated from Vietnam” on the goods labelled for consumption in the domestic market or exports.

To perform fraudulent act of origin, traders also import goods originating from a foreign country to transit through Vietnam to legalise the dossier or apply for a certificate of origin then export to a third country.

According to the General Department of Customs, the subjects have taken advantage of the lax in issuing C/O to legalise C/O application such as: failure to declare the origin of input materials, signing blank contract for buying domestic raw materials, using VAT invoices for many export declarations, repeating the C/O applications.

The General Department of Customs has issued many documents to assign the Customs Departments to inspect, supervise and strictly control the origin of goods and labelling and intellectual property rights for imported and exported goods.

On August 13, the General Department of Customs issued Official Dispatch No. 5189/TCHQ-GSQL to assign Customs units to inspect and determine origin, preventing acts of origin fraud and forgery, infringement of intellectual property rights and illegal transit.

Accordingly, on the basis of information on enterprises, imports and exports subject to high risks of origin fraud and forgery, labelling, infringement of intellectual property rights, illegal transit, channel classification criteria on the system and other information, the municipal and provincial Customs Departments direct their customs branches and their subordinate units to take measures to inspect, supervise and control the origin and labelling; infringement of intellectual property rights and illegal transit of import and export goods in accordance with legal documents.

	Customs prevents origin fraud and protect intellectual property rights
	Customs sector detects many cases of origin fraud

In addition, the General Department of Customs also directs provincial and municipal customs departments to inspect and control and to assign tasks to attached and subordinate units to prevent fraudulent acts.