Mechanisms and policies related to goods origin in Vietnam

1.1. Decree No. 31/2018 / ND-CP dated March 8, 2018 detailing the Law on foreign trade management on goods origin

The Decree includes 6 Chapters, 36 Articles and 4 Annexes. In this Decree, in order to match international commitments and reduce administrative procedures, the Government updated some new points as follows:

1.1.1. Self-certification of origin

 

One of the new problems in the negotiation process of FTAs ​​is the mechanism of self-certification of goods origin (hereinafter referred to as the EPI). This mechanism is becoming a new trend in FTAs ​​such as the Comprehensive Partnership and Trans-Pacific Partnership (CPTPP), FTA between Vietnam and the European Union, ASEAN Trade in Goods Agreement (ATIGA). . Accordingly, traders are allowed to declare and commit to goods origin instead of C / O issuers at C / O issuers. The mechanism of export and import helps exporters to save costs, time and proactively in production and export business. Accordingly, traders are allowed to declare and commit to goods origin instead of C / O issuers at C / O issuers.

1.1.2. Electronic certificate of origin

Recently, the Ministry of Industry and Trade has been trying to simplify administrative procedures in the field of C / O issuance, initially creating positive changes in the form of C / O issuance via the Internet. According to the process of issuing C / O via the Internet, traders declare and submit electronic documents, not submit a certificate of origin certificate. The number of C / O records should be checked and stored at C / O issuers. Deadlines for archiving records in a number of new FTAs ​​lasting from 3 years to 5 years require proper storage. Therefore, the improvement and upgrading of the current C / O management system in the direction of electronicization requires specific regulations. Along with facilitating traders to declare and issue C / O via Inter-net, the Decree stipulates the specific responsibilities of traders to declare and apply for electronic C / O and to archive evidence. from.

1.1.3. Documents, procedures and procedures for issuing C / O include the process of declaring and issuing C / O via the Internet

In the spirit of continuing to innovate on administrative procedure reform in C / O issuance, the Decree stipulates in the direction:

Firstly: Combining the procedure of granting preferential C / O and non-preferential C / O from two different previous Circulars into a common procedure to unify management and facilitate traders when proposing C / O.

Second: In the C / O application file, remove the request for certification of the local government where the production of materials and goods is produced in case of using raw materials and goods purchased domestically for production. In fact, it is very difficult for traders to obtain this certificate or local confirmation incorrectly, resulting in many cases of export traders falsifying certification. Instead, the Decree provides a declaration of origin for producers or suppliers of raw materials in Vietnam in case the material is used to produce other goods.

Third: Building a risk management system in the process of issuing C / O through streamlining C / O application dossiers, contributing to solving procedures for traders in the spirit of administrative procedure reform.

1.1.4. Regulations on certification of origin of imported goods

The Decree has 2 amendments compared to the previous regulations:

Firstly, clarifying the case of imported C / O must be submitted to customs authorities for goods that are likely to cause harm to social safety, health, and goods imported from Vietnam. applying measures of trade defense, tariff quotas and goods under the regime of import management under Vietnamese law and international treaties. The above-mentioned cases of goods shall be carried out in accordance with the List of goods managed by the Ministry after exchanging and reaching agreement with the Ministry of Industry and Trade.

Secondly, amendments to the timing of submission of imported C / O goods due to commitments in FTAs ​​differ in this regard. In fact, some FTAs ​​allow traders to submit C / O after the time of import procedures and within the validity period of the C / O (within 1 year from the date of issue). Therefore, Nghi decided to abolish the compulsory regulation of paying C / O at the time of customs clearance.

1.1.5. Issuing C / O for foreign traders whose goods are stored in bonded warehouses and awaiting export and issuing unchanged Certificate of origin

Although the Decree No. 19/2006 / ND-CP dated February 20, 2006 of the Government provides in detail the Commercial Law on origin of goods, there are provisions on procedures for granting C / O for goods stored in foreign warehouses. The agency waiting for export but the object of C / O application is limited to Vietnamese traders. In order to contribute to the development of bonded warehouse business, take advantage of seaports and geographical position to become a regional center for goods transshipment and distribution, Decree No. 31/2018 / ND-CP regulations to expand the object, allowing foreign traders to be granted C / O in the case of goods stored in bonded warehouses awaiting export.

The granting of back-to-back C / O is commonly applied in signed FTAs. However, the previous internal law does not have specific provisions for granting C / O for goods not from FTA, and put into bonded warehouses waiting for export to other countries. This leads to difficulties for traders to transfer goods to Vietnam and then export. The Decree additionally provides for the issuance of certificates of non-originating goods certificates for goods originating from foreign countries (not under FTAs) and put into Vietnam’s bonded warehouses and then exported. Certificate of unchanged goods of origin includes minimum information such as original country of origin, final destination country, original C / O reference number, date of arrival of goods in Vietnam, date of departure from Vietnam Male, transport information, confirmation of C / O issuers and organizations in Vietnam.

1.1.6. Strengthening post-inspection and anti-fraud of goods origin and handling violations

In the context of expanding the C / O issuance form through the Internet and applying the CO, the checking and verification mechanism of origin also needs to change in the direction of gradually shifting to post-inspection. However, in fact, when creating agreement, the risk of origin fraud will increase. The phenomenon of commercial fraud through goods origin, borrowing of Vietnamese goods origin to benefit free or as a means to avoid more and more trade defense measures.

In addition, increased countries apply trade defense measures. When the volume or value of exported goods from Vietnam increases dramatically, importing countries (especially large markets like the EU and the US) will consider and investigate anti-fraud, anti-dumping or take safeguard measures for Vietnamese exports. This has a negative impact on the export of goods of the same type in particular and affects exports in general of Vietnam.

Therefore, in addition to strengthening C / O post-inspection, the Decree creates a legal corridor to build a risk management system in the process of issuing C / O and measures to prevent fraud. In addition to handling administrative violations in accordance with the law, the Decree stipulates some additional sanctions for violations of traders on goods origin, including withdrawal of issued or postponing C / O issuance depending on the severity and case of violation.

The decree stipulates that in case of necessity, the Minister of Industry and Trade reports to the Prime Minister to apply specific measures to prevent the above situation as a monitoring mechanism in the process of granting Certificate of Origin. goods, temporarily granting certificates of origin of goods to some goods or fraudulent traders.

1.2. Circular No. 05/2018 / TT-BCT dated April 3, 2018 regulating the origin of goods

 

The Circular includes 4 chapters, 11 articles and 13 attached annexes. Specifically, the Circular provides for ways of determining origin of goods, including provisions on determination of preferential origin criteria, determining non-preferential origin criteria and specific list of goods items for non-preferential C / O form B, detailed formula for calculating “value percentage” (LVC); forms for declaration and commitment of origin of goods to meet preferential origin criteria or non-preferential origin criteria based on basic origin criteria.

 

Appendix I of the Circular (Item Specific Rules – PSR), built from Chapter 01 to Chapter 97, includes the 2017 HS version codes at the 6-digit level. On the basis of reference to PSR in Free Trade Agreements (FTA) Vietnam is a member, with the comments of relevant agencies and the results of consultations with industry associations, PSR in Annex I The Circular is updated and built more flexibly than the Circular guiding the Decree No. 19/2006 / ND-CP dated February 20, 2006 of the Government detailing the Commercial Law on goods origin to promote and motivate Vietnamese goods to export to markets without FTA preferential tariffs.

1.3. Circular No. 11/2018 / TT-BCT dated May 29, 2018 amending and supplementing Circular No. 21/2016 / TT-BCT dated September 20, 2016 on implementing the Rules of Origin of Goods in the Agreement Free trade between Vietnam and the Eurasian Economic Union

 

Implementation of the Notice of December 26, 2017, by the Eurasian Economic Commission and the January 16, 2018 Letter of Confirmation of Vietnam on the amendment of Annex III – Specific rules of goods under Chapter IV – Rules of origin within the framework of the Free Trade Agreement of Vietnam and the Eurasian Economic Union, Ministry of Industry and Trade issued Circular No. 11/2018 / TT-BCT dated May 29, 2018, amending and supplementing Information Circular No. 21/2016 / TT-BCT dated September 20, 2016 of the Minister of Industry and Trade regulating the implementation of rules of origin of goods in the Free Trade Agreement between Vietnam and the Eurasian Economic Union. Accordingly, Appendix II – Specific rules of goods issued together with Circular No. 21/2016 / TT-BCT are replaced by the Appendix issued together with Circular No. 11/2018 / TT-BCT; Procedures for granting and checking Certificate of origin of goods comply with Annex I issued together with Circular No. 21/2016 / TT-BCT, Decree No. 31/2018 / ND-CP dated 08 months 03 2018 of the Government detailing the Law on Foreign Trade Management on goods origin and Circular No. 05/2018 / TT-BCT dated April 3, 2018 of the Minister of Industry and Trade regulating the origin of goods

1.4. Circular No. 15/2018 / TT-BCT dated June 29, 2018 stipulating the channeling in the process of granting Certificate of preferential origin

 

Pursuant to Article 31 of Decree No. 31/2018 / ND-CP dated March 8, 2018 detailing the Law on Foreign Trade Management regarding goods origin, the Ministry of Industry and Trade promulgates “Circular regulating channeling in procedures Certificate of preferential origin ”. Accordingly, preferential levels in the process of issuing C / O are distributed according to the following principles:

– Green channel: a preferential regime applicable to traders with good history, well abiding by the law on goods origin and personnel with knowledge of goods origin and storage systems to ensure their identity authentication of C / O.

– Common channel: the current regime in the process of granting preferential C / O according to the provisions of Decree No. 31/2018 / ND-CP and relevant guiding documents.

– Red channel: control regime applied to traders violating the law of origin of goods, failing to meet the requirements of proving the origin of goods, exporting goods at high risk of fraudulently originating goods but no production base.

Threading is carried out in the same priority mode, with a channel transfer mechanism and anti-fraud control mechanism.

1.5. Circular No. 26/2018 / TT-BCT dated September 14, 2018 amending and supplementing Appendix IV issued together with Circular No. 20/2014 / TT-BCT dated June 25, 2014 stipulating the implementation of the Code originated in the Asean Free Trade Area Agreement – Korea

Implementation of the negotiation results of the Group of Tax Sub-Committees, Rules of Goods Origin and Customs Procedures (AKSTROO) for the 25th time within the framework of the Committee implementing the ASEAN-Korea Free Trade Agreement (AK- IC) for the 16th time in Thailand in August 2017, ASEAN and South Korea reviewed the 2016 Decision approving the list of converting HS codes of goods to the 2012 HS version for 100 Korean special items. production license in Khai Thanh Industrial Zone – Democratic People’s Republic of Korea (GIC list) under Annex 3 Chapter of Rules of Origin of AKFTA On the basis of implementing the Decision on approving the list of goods to be converted to the 2012 HS version for the GIC list of ASEAN and Korea, the Ministry of Industry and Trade issued a revised and supplemented Circular Appendix IV issued together with Circular No. 20/2014 / TT-BCT converting GIC portfolio from 2007 HS version to 2012 HS version.

1.6. Circular No. 38/2018 / TT-BCT dated October 30, 2018 regulating the implementation of certificates of origin of goods under the universal tariff preferential regime of the European Union, Norway, Switzerland and Turkey .

According to EC regulations, the mechanism of certification of origin of goods under GSP (REX mechanism) applies to goods exported from Vietnam from January 1, 2019. Circular guiding GSP regulations about the process of registration and approval of the certificate of origin of goods (REX code). Entrusted merchants to export goods to other traders to the European Union, Norway, Switzerland and Turkey must not use their REX codes to issue certificates of origin according to GSP for export goods of trustees.

For export consignments with a total value of less than EUR 6,000 calculated at ex-factory price, traders are not required to register the REX code and are allowed to export the exported goods. Exported goods of traders who do not have an REX number under GSP are still granted a C / O form A during the transition period in accordance with EC regulations (12 months from January 1, 2019 and may be considered for review). term of 6 months).

In order to ensure management, the Circular stipulates the application of some measures such as (1) revocation / cancellation of CNXX issuing incorrect regulations or revocation of traders’ REX codes and (2) request for trade update the data of each applicable REX shipment to manage and support data retrieval and verification of origin.

1.7. Circular No. 39/2018 / TT-BCT dated October 30, 2018 regulating the inspection and verification of origin of exported goods

Circular on inspection, verification of origin of goods for the certification mechanism of origin. Based on the comparison of terms of inspection and verification of goods origin in Chapter of Origin of goods under preferential and non-preferential commitments, some FTA and GSP importing countries stipulate a little difference in order of inspection, verification and administrative coordination between the importing country and the exporting country. However, the two basic methods are: (i) checking records, certificates of origin of goods and (ii) checking and verifying at the production facility still applies.

The order of checking and verifying the origin of goods in the Circular stipulates the steps for coordination between the Ministry of Industry and Trade and the competent agencies, organizations and traders. Where the process of checking and verifying the origin of goods stipulated in FTAs ​​or GSPs is different from the Circular, agencies, domestic competent agencies and traders comply with international treaties that Vietnam Male is a member or according to importing country regulations.

1.8. Circular No. 42/2018 / TT-BCT dated November 12, 2018 amending and supplementing a number of articles of Circular No. 31/2015 / TT-BCT dated September 24, 2015 stipulating the implementation of the Rules of Origin in Agreement to Establish Asean Free Trade Area – Australia – New Zealand

At AANZFTA’s 14th meeting of the Committee for Trade in Goods (CTG) and the 10th Joint Committee of the Implementation of Agreement (FJC) in April 2018 in Da Nang, the list of specific rules of goods ( PSR) converted to 2017 HS version approved by the Parties and takes effect from January 1, 2019, does not apply the transition period.

Implementing international commitments and adjusting the process of granting AANZ sample C / O according to Decree No. 31/2018 / ND-CP dated March 8, 2018 of the Government detailing the Law on Foreign Trade Management regarding goods origin (hereinafter referred to as Decree No. 31/2018 / ND-CP), the Import and Export Department presided over the draft of the Circular amending and supplementing a number of articles of Circular No. 31/2015 / TT-BCT dated September 24, 2015 prescribes the implementation of the Rules of Origin in the Agreement on Establishment of ASEAN – Australia – New Zealand Free Trade Area.

The Ministry of Industry and Trade promulgated the amended and supplemented Circular with the contents of converting Appendix II – Specific rules of goods of Circular No. 31/2015 / TT-BCT to 2017 HS version and adjustment process, Procedures for granting AANZ C / O form according to Decree No. 31/2018 / ND-CP are necessary, updated and do not increase administrative procedures for traders. The above Circular is issued together with the list of specific rules of goods according to 2017 HS version.

Source:VIETNAM EXPORT IMPORT REPORT 2018-MOIT

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