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February 9, 2023

Vietnam: Draft Circular on Determining Origin of Imported and Exported Goods

Vietnam’s Ministry of Finance is drafting a circular on determining the origin of imported and exported goods. This circular, a draft version of which has been released for public comment (“Draft Circular”), consolidates prevailing regulations and guidelines on determining the origin of imported and exported goods that are stipulated in the following legal documents, which the Draft Circular would replace when it comes into effect:

  • Circular No. 38/2018/TT-BTC dated April 20, 2018, of the Ministry of Finance regulating the determination of origin of imported and exported goods, as amended by Circular No. 62/2019/TT-BTC dated September 5, 2019, of the Ministry of Finance;
  • Circular No. 47/2020/TT-BTC dated May 27, 2020, regulating the time to submit documents proving the origin of goods and form of the documents proving the origin of imported goods applied during the Covid-19 pandemic; and
  • Circular No. 07/2021/TT-BTC dated January 25, 2021, regulating the time to submit documents proving the origin of imported goods under the EU-Vietnam Free Trade Agreement (EVFTA).

Generally speaking, the Draft Circular does not increase the administrative procedures for importers and exporters, but rather seeks to codify the recent practices implemented by the customs authorities. The Draft Circular focuses on providing comprehensive guidance for importing/exporting companies when carrying out administrative procedures to certify the origins of imported and exported goods to be in line with current trade practices and international commitments under new-generation free trade agreements. In particular, the Draft Circular supplements guidelines on declaring origins and submitting Certificates of Origin (C/Os) of imported goods under the EVFTA and the Regional Comprehensive Economic Partnership Agreement (RCEP).

The Draft Circular also provides some new guidelines to facilitate exports (and imports) and overcome some obstacles and issues when implementing the prevailing regulations. For example, the submission of C/Os online, which was only applicable during the Covid-19 period, would still be applicable under the Draft Circular. Another significant change is that the timeline to submit C/Os is prolonged from 30 days to one year from the date of declaring customs for imported goods subject to special preferential tax, and two years for imported goods having C/Os issued according to free trade agreements between Vietnam and specified partners.

A new noteworthy point of the Draft Circular is that the application of tax guarantee, for cases where C/Os have not been submitted at the time of declaring customs or in the case of conducting verification of origin, would allow the imported goods to clear customs first, with the importers submitting C/Os and fulfilling their tax obligations later.

The Draft Circular is in the process of obtaining opinions from relevant associations and enterprises, and its tentative effective date has not yet been determined.

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