Loopholes in import of used goods

	Specialized project HP002 and the fight against prohibited goods in Hai Phong port area
	The level of physical inspection for imported scrap will follow the directives of system
	2 containers are full of used electric and refrigeration products at Cat Lai port

Customs officers of Huu Nghi Customs Branch inspect imported machinery. Photo: H.N

Permit and ban needs to be specified

The Ministry of Finance said that there are regulations related to the import of used goods and waste. According to Article 10 of the Law on Foreign Trade Management, the Government stipulates the list of goods banned from export and import. The Prime Minister shall decide to permit the import and export of goods specified in Clause 1 of this Article for special purposes, warranty, analysis, testing, scientific research, health, pharmaceutical production, defense and security protection.

Based on the provisions of Decree 69/2018/ND-CP, the Ministry of Industry and Trade issued a list of used goods banned from import accompanied with HS codes. The Ministry of Information and Communications has announced the list of used IT products banned from import with HS codes. The Ministry of Transport is also drafting a circular to replace Circular 13/2015/TT-BGTVT announcing the list of imported goods under its specialized management, including the list of goods banned from import. In addition, the import of used goods complies with the Prime Minister's Regulations.

According to Clause 9, Article 7 of the Law on Environmental Protection, it is prohibited to import or transit waste from abroad in any form. Currently, to determine whether an item is waste or not, it is not based on used criteria but must be based on the provisions of the Law on Environmental Protection and relevant international treaties to which Vietnam is a member. Clause 12, Article 3 of the Law on Environmental Protection states:"Wastes refer to a kind of materials emitted from activities such as manufacturing, trading, service, daily activities and others," but the guiding documents do not specify what an “emission” is. Because Vietnam is a member of the Basel Convention on the control of cross-border transport of hazardous wastes and their destruction must comply with the provisions of this convention. Specifically, the Basel Convention states that "waste is substances or objects that people destroy, intend to destroy or must destroy according to the provisions of national laws".

According to the Ministry of Finance, based on these provisions, the used goods that are not onthe list of goods banned from import or on the list but allowed to be imported by the Prime Minister under special purposes shall be imported. If the used goods are not identified as "waste" but are identified as "scrap", they shall be imported according to regulations on scrap management. If they are identified as normal goods and not on the list of banned goods, they shall be imported.

Some enterprises imported goods and declared as used goods which were still of original use value and are not waste and not on the list of used goods banned from import, they are still subject tocustoms clearance procedures.

The Ministry of Finance said that the current regulations on used goods still have legal loopholes, so that some businesses import used goods (such as waste, scrap and goods causing environmental pollution) into Vietnam but declare the import for original use.

Therefore, to strictly control this situation, the Ministry of Finance proposed ministries and branches to develop a list of used goods allowed to be imported, issued together with the standards, conditions, and used goods outside this list shall be banned from import.

Customs strictly controls customs clearance stage

Currently, the import of used machinery, equipment and technology lines complies with the Prime Minister's Decision 18/2019/QD-TTg. To strictly manage the import and prevent the taking advantage of preferential policies for investment attraction to import old, outdated and inferior machineryand equipment, failing to meet business production requirements, increasing product prices, causing environmental pollution, reducing competitiveness of enterprises, the General Department of Vietnam Customs issued an official dispatch requesting provincial and municipal Customs Departments not to carry out customs procedures and customs clearance for used machinery, equipment and technological lines exported from countries that have announced to eliminate these products due to backwardness, low quality, and causing environmental pollution, or failing to meet requirements on safety, energy and environmental protection under the law.

To request customs declarants to fill in information on goods names, categories, labels, quality, models, symbols, production years, origin countries, HS codes and legal documents on e-customs declarations; check and compare with import dossiers. In addition, the units need to search the list of used machinery, equipment and technological lines that countries have announced to eliminate due to backwardness, low quality, and causing environmental pollution published on the Ministry of Science and Technology’s portal.

When taking goods for preservation, customs officers must seal the whole shipment, make a hand-over record including suspicious contents of the Customs of the shipment to transfer to the assessment organizations approved and designated by the Ministry of Science and Technology. Inspection certificates submitted by customs declarants to customs authorities for customs clearance must be approved by assessment organizations on receipt of shipments with customs seals. Customs authorities only accepted the results of assessment organizations that are designated, recognized by the Ministry of Science and Technology and published on the Ministry of Science and Technology’s Portal for customs clearance.

The used machinery and equipment shall be subject tocustoms clearance if their import dossiers satisfy regulations in Clause 1, Article 8 of Decision 18/2019/QĐ-TTg. If used machinery and equipment are manufactured in G7 countries or South Korea but there is no certificate of manufacturer, or are made innon-G7 countries and South Korea, they must have an inspection certificate that meet the requirements specified in Article 6 of Decision 18/2019 / QD-TTg.

For machinery, equipment and technological lines without quality declaration or declared as new goods, if checking the dossier, suspecting signs of false declaration of information on goods to import used machinery and equipment, technological lines, aphysical inspection shall be required. When the goods’ quality cannot be identified by physical inspection, the verification by assessment organizations designated and recognized by the Ministry of Science and Technology shall be conducted. Customs authority shall base on the assessment results to decide customs clearance. While waiting for the assessment results, goods are not allowed to be taken for preservation.

The General Department of Customs has instructed the units to intensify the physical inspection, strictly control machinery, equipment and technological lines exported from non-G7 countries, South Korea and there are signs of shifting production investment to Vietnam to take advantage of Vietnamese origin to export goods to foreign countries to enjoy preferential tax policies.