Revise regulations on origin fraud prevention

	Procedures for certifying origin declaration abolished: VND23 billion and nearly 500,000 man-hours saved
	Need to specify counterfeit origin of goods
	Rules of origin make it difficult for businesses to take advantage of preferential tariffs from FTAs

Officers of Tinh Bien Customs Department inspect imported goods. Photo: Thu Hoa.

Obstacles in identifying simple processing and assembly process

The GDVC reported on some shortcomings in provisions related to identification of simple processing and assembly as prescribed in the Government Decree 31/2018.

Customs has faced difficulties in performing the tasks as these regulations have not yet been specified.

Some enterprises only implement simple processing and assembly but Customs does not have a legal framework to clarify their violations.

For example, firms import all raw materials and components from abroad and then use some machinery such as screws and welding machines to manufacture export products, and declare goods as originating from Vietnam.

The form and criteria on non-preferential certificates of origin have not yet been provided in this decree.

In fact, when carrying out customs procedures for goods imported from countries or territories not having agreements on special preferential import tariffs in trade relations with Vietnam, there have been some problems related to requirements on providing information in the non-preferential certificates of origin.

Article 15 of Circular 38 of the Ministry of Finance says that information stated in the non-preferential certificates of origin will comply with recommendations by the World Customs Organization (WCO) and the revised and supplemented Kyoto Convention.

Some enterprises have voiced their concerns related to the submission of C/O of import goods not subject to tax incentives. Accordingly, goods that are subject to Anti-dumping tax, Anti-subsidy tax and applied safeguard, tariff quota, and quantitative restriction measures by Vietnam must submit the C/O but those lack some information such as HS code, so Customs has not accepted to carry out procedures and imposed these measures.

The general department also said that provisions in Article 29 of Decree 31 have been relatively clear and are the key legal framework for the Ministry of Industry and Trade and relevant authorities to implement.

However, the coordination in inspection and identification for goods origin in the premises of enterprises and the information related to granting certificate of goods origin has not yet achieved positive results.

Some regulations have not yet been stipulated specifically, leading to overlapping or lack of information and causing difficulties in the investigation of customs.

Supplementing tasks on origin fraud prevention

From these shortcomings, the GDVC has proposed to supplement and amend some provisions in the Government Decree 31/2018.

Accordingly, provisions stipulated in Article 9 of the decree should be revised to specify principles and mechanisms for determining simple processing.

The department has suggested that the determination should be based on the approvals by the Ministry of Industry and Trade, Ministry of Finance, Vietnam Chamber of Commerce and Industry (VCCI).

For example, when it is necessary to identify a specific case, the lead authority will consult with the remaining authorities.

At the same time, the GDVC has asked to provide in detail for criteria of non-preferential certificates of origin to ensure strict control for the import goods, and unified performance.

Accordingly, the supplemented criteria include the exporter, the importer, means of transport, goods description, goods number, quantity, weight or volume of goods, countries, groups of countries or territories of origin, date of issuance, and signature.

The tasks of the two ministries in performing anti-origin fraud measures should be supplemented in the direction that the Ministry of Industry and Trade will strengthen the inspection and supervision organizations issuing C/O to timely detect certificates that are issued inconsistent with the law. Strictly control enterprises self-certification of origin to prevent fraud.

The Ministry of Finance will be in charge of investigating and identifying cases committing violations related to origin fraud and illicit transshipment. The Ministry will coordinate with the Ministry of Industry and Trade and other authorities in this work.

Annually report to the Prime Minister on the fight against origin fraud and illicit transshipment, and achievements and propose specific solutions to prevent this issue.