Recommendation of investigation for profiteering from rice export policy by quotas

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Recommended to prioritise 150,000 tonnes of rice left in port

The General Department of Customs proposed many solutions to ensure public and transparent rice exports and food security.

Regarding management of exported rice, to ensure State management over exported rice; to ensure publicity, transparency and convenience for enterprises when planning to export rice and handle rice currently stored at the border gates but cannot be exported, the General Department of Customs stated as follows:

For rice consignments stuck at the border gates and have not yet been exported, the Prime Minister allows the export of rice consignments that have been brought into ports before March 24, 2020 but have not yet registered customs declaration in April certified by port operators and customs agencies (the Vietnam Food Association said it is 146,453 tonnes). The amount of exported rice will be deducted from the export quota.

Two options for quota management

As for quota management during the Covid-19 pandemic, the Prime Minister approved the amount of rice allowed to be exported (excluding sticky rice) and set aroadmap and export schedule. On that basis, the Ministry of Industry and Trade was assigned to select the most optimal plan to submit to the Prime Minister for approval.

The two options proposed by the General Department of Customs are: the first option, the Ministry of Industry and Trade is assigned to organize the auction of rice export quotas (similar to the auction of sugar import quotas implemented by the Ministry of Industry and Trade).

The Ministry of Industry and Trade publicly announced the export quotas of rice and divided it into auction packages.

Enterprises can participate in the auction if they meet the following conditions: conditions specified in Decree No. 107/2018 / ND-CP on rice export business; won the bid of rice supply contract, signed a contract and completed rice delivery to the regional State reserve departments; signed an agreement with at least one supermarket system to ensure a 5% circulation supply upon required.

If enterprises meet the above conditions and are notified by the Ministry of Industry and Trade of the auction enterprises, the customs agency willhandle the export procedures according to regulations.

For the second option, the Ministry of Industry and Trade is assigned to allocate rice export quotas to enterprises that meet rice trading conditions prescribed in Decree No. 107/2018 / ND-CP.

According to the General Department of Customs, to ensure publicity and transparency, as well as time for Customs to re-open the system (after stopping receiving declarations the quota is over) when issuing a decision on the allocation of export quotas, the Ministry of Industry and Trade needs to reach an agreement with the Ministry of Finance (the General Department of Customs) on the time of the application for public announcement to enterprises for implementation.

Proposal on not applying quota after Covid-19 pandemic

When the Covid-19 pandemic ends, the General Department of Customs requests the Ministry of Industry and Trade and the Ministry of Agriculture and Rural Development to assess the situation of domestic rice production, demand for national reserves and domestic consumption, if supply and demand are ensured,ministries will then report to the Prime Minister to allow enterprises to continue carrying out rice exports in accordance with Decree No. 107/2018 / ND-CP; and shall not be managed for export rice by export quotas.

Regarding the export rice management policies, the Prime Minister assigned authorities to investigate, verify and clarify organizations and individuals who not strictly comply with Decree No. 107/2018 / ND-CP, directions by the Prime Minister in Notice No. 121 / TB-VPCP dated March 23, 2020 and Official Letter No. 2827 / VPCP-KTTH dated April 10 / 2020, and clarifying whether or not there is profiteering from the rice export quota management policy to strictly handle it.

Regarding the bid to buy national reserve rice, according to the General Department of Customs, per the provisions of the Bidding Law, if the contractor wins the bid but refuses to sign acontract, they must pay abid security from 1% to 3% of the bidding package price.

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However, this regulation is not strong enough to bind the contractor's responsibility when winning the bid, so the General Department of Customs requests the Prime Minister direct concerned ministries and agencies to study amending and supplementing the Bidding Law to include sanctions against bidding.