Granting certificates of origin via National Single Window mechanism to prevent trade fraud

TOPPER shoes was import under the form of temporary import and re-export from China to Vietnam showing signs of fraudulent origin (goods was imported from China but it labelled "Made in Vietnam") that was seized by Hai Phong Customs in July 2019.

Very small amount of C/O granted

According to the Ministry of Finance (General Department of Vietnam Customs) – PermanentOffice of the National Steering Committee on ASEAN Single Window (ASW), National Single Window (NSW) and trade facilitation (Commission 1899 ), from January 1, 2018, Vietnam has connected and exchanged electronic C/O form D (issued by the Ministry of Industry and Trade through NSW) with ASEAN countries and is in the process of expanding the connection with other trading partners.

According to the Ministry of Finance, certificates of origin (C/O) are important documents related to the trade of import and export goods and are connected with foreign partners. Therefore, full implementation of electronic declaration and certification through NSW will not only help the agency grant C/O, but also help Customs authorities have information and data for preventing fraud. At the same time, this is also necessary to connect and exchange information in accordance with international commitments.

Regarding granting C/O through NSW, the Vietnam Chamber of Commerce and Industry (VCCI) has issued C/O form B to ASEAN via NSW since early 2016.

But since then, only 77 dossiers have been declared and of that number only two certificates were approved and licensed (one in 2017 and one in 2018). Thus, issuances of C/O form B to ASEAN of VCCI through NSW were very limited.

Moreover, the information of C/O form B to ASEAN since the deployment was still implemented through the internal systems of the VCCI or in other forms.

According to the Ministry of Finance, through implementation, the VCCI gave feedback regarding several arising problems and they have been handled by the Ministry of Finance (the General Department of Vietnam Customs) in coordination with the VCCI.

The VCCI has just implemented the granting C/O form B for goods exported to ASEAN countries and it has not implemented with other markets outside ASEAN. In this case, the Ministry of Finance (the General Department of Vietnam Customs) has provided the service of looking up the information of declaration so the VCCI could look up information for granting C/O. However, as of early December 2019, the VCCI has not worked with the Ministry of Finance (the General Department of Vietnam Customs) to implement the issuance ofC/O form B for goods exporting to countries outside ASEAN. Not only that, according to this plan, the Ministry of Finance (General Department of Vietnam Customs) would not have any information about the process of granting, so they cannot assess risks.

With the issuance of C/O form D to ASEAN of the Ministry of Industry and Trade which has been implemented since 2014 and participated in exchanges with ASEAN countries from January 1, 2018 (via ASW), up to now, Vietnam has exchanged information on C/O form D with six countries including Singapore, Malaysia, Indonesia, Thailand, Brunei and Cambodia. Although the issuance of C/O has been carried out by the Ministry of Industry and Trade, by quickly deploying the connection of the NSW, the Ministry of Industry and Trade recommended the procedure for the issuance of the certificate be done in the form of "embedded". This means the request application for granting certificate of origin should be sent directly to ECOSYS (Electronic C/O system at level 4 managed by Ministry of Industry and Trade) and not be stored in the National Single Window Portal.

Up to now, the General Department of Vietnam Customs has proposed several times but the Ministry of Industry and Trade has not coordinated to convert to an appropriate model, so the Customs authority did not have enough data to issue certificates of origin.

Regarding preferential certificates of origin for other markets, the Ministry of Industry and Trade has not implemented the issuance via the NSW yet. However, per the request of implementing the E-Government, the Ministry of Industry and Trade has issued documents to announce they would connect with the Online Public Service Portal of the Government for implementation.

Deploying fully to prevent fraudulent origin

According to Ministry of Finance (General Department of Vietnam Customs), to strengthen the prevention of origin fraud, the full implementation of granting C/O via National Single Window Portal is important. So Customs authority and agency granting C/O would have sufficient information to assess risk in the performance.

Specifically, for the VCCI, the Ministry of Finance proposed strictly and fully granting C/O for non-preferential goods (via electronic mode) to ASEAN countries through the National Single Window Portal. At the same time, expanding the issuance of e-C/O with other markets outside ASEAN.

With the Ministry of Industry and Trade, changing the model of C/O form D to follow the mode of NSW and complete before September 30, 2020.

Facing complex trade wars between big countries, the situation of fraudulent Vietnamese origin is very complicated.

Customs authorities have discovered and handled many cases of foreign goods camouflaged “Made in Vietnam” for export to third countries or domestic consumption.