New guidance on applying preferential tariffs in EVFTA

Professional activities at Noi Bai International Airport Customs Branch. Photo: N.Linh

This is new guidance, following the Official Letter No. 6464/TCHQ-GSQL dated October 5, 2020, sent by the General Department of Vietnam Customs to the Customs Departments of provinces and cities to implement the free trade agreement between Vietnam and the European Union (EVFTA).

For goods imported from bonded warehouses to the domestic market since the effective date of EVFTA, Article 6 of Decree No. 111/2020/ND-CP dated September 18, 2020 stipulates that: " 3. For customs declarations of exported and imported goods registered from August 1, 2020 to the date before the effective date of this decree, if all regulations are met to enjoy preferential export or special preferential import duty of Vietnam in this decree and the tax has been paid at a higher tax rate, the overpaid tax would be handled by the customs authority in accordance with the law on tax management.”

Article 39, Circular No. 11/2020/TT-BCT guiding rules of origin of the EVFTA stipulating goods being transported or stored states that: “Preferential tariffs of the EVFTA are applied to goods complying with the provisions of this circular and on the date of entry into force of the EVFTA, the goods are located in a member country or during transportation or temporary storage in bonded warehouses or in non-tariff zone with the condition that certificate of origin is submitted to customs authorities of the importing member country. In case of being requested, importer should submit documents proving that the goods have no change of origin as prescribed in Article 17 of this circular to the customs authority of the importing member country.”

For goods originating from EU imported from bonded warehouses inland from the effective date of the EVFTA (August 1, 2020), special preferential tariff rates will be applied if the proof of origin of goods is submitted and meet the provisions of Circular No. 11/2020/TT-BCT and Circular No. 38/2018/TT-BTC.

Regarding form of proof of origin of goods under the EVFTA, it will comply with Clauses 2 and 3, Article 24, Circular No. 11/2020/TT-BCT.

Specifically: “The exporter will self-certify the origin of the goods on the invoice, delivery note or other commercial documents with sufficient information about the goods, by typing, stamping or printing the content of the declaration about origin of goods on documents. Exporters use the Declaration of Origin Form in one of the language versions specified in Appendix VII issued with this Circular and in accordance with the regulation of European Union…”

Commercial vouchers can be delivery notes, proforma invoices or packing lists. Transport documents like bill of lading or air waybill are not considered as other commercial vouchers.

The case of self-certification declaration of origin on the delivery note, proforma invoice or packing list is in accordance with regulations and this document is issued by the exporter from 1 August, 2020 and adds text of self-certification in accordance with the provisions of Circular No. 11/2020/TT-BCT, it will be accepted for special preferential tariff rates.

For proof of origin in case the seller is located in the territory of a country that is not a member of the EVFTA, the General Department of Vietnam Customs requested the units to comply with the provisions of Circular No. 11/2020/TT-BCT and is guided in detail in Official Dispatch No. 6464/TCHQ-GSQL dated October 5, 2020.

Besides the above content, the General Department of Vietnam Customs also guides the content related to the signature on the declaration of self-certification of origin of the exporter and lookup information when checking REX codes.

The General Department of Vietnam Customs requested Customs departments of provinces and cities to direct the units to carefully study the rules of origin in the EVFTA, Circular No. 11/2020/TT-BCT and related guiding documents of the General Department of Vietnam Customs to continue training to implement consistently, avoid causing troubles and difficulties for enterprises.