Can the foreign EPEs temporarily import and re-export goods into Vietnam? If yes, how to temporarily import and re-export goods into Vietnam under the latest regulations?
What is the customs-controlled area in Vietnam?
According to the provisions of Article 4 of the Law on Foreign Trade Management 2017 as follows:
Article 3. Definitions
For the purpose of this Law, the terms below shall be construed as follows:
1. ”foreign trade activities” means activities related to the international controlled area in Vietnamimportation; temporary exportation; merchanting trade; transit and other activities related to the international exchange of products in accordance with regulations of Vietnam law and international treaties to which the Socialist Republic of Vietnam is a signatory.
2. “technical measures” means measures imposed on exports and imports in accordance with regulations of law on the quality of goods and products, technical standards and regulations, food safety and measurement.
3. “quarantine measures” includes sanitary measures for animal and animal products and phytosanitary measures and border health quarantine measures in accordance with regulations of law on plant protection and phytosanitary, veterinary medicine and prevention and fighting of infections.
4. “customs-controlled area” means a geological area in the territory of Vietnam that is established in accordance with regulations of Vietnam law and international treaties to which the Socialist Republic of Vietnam is a signatory and the exchange of products between this area and the remaining territory of Vietnam or foreign countries are considered as import and export activities.
5. “foreign trader without presence in Vietnam” means a foreign trader who does not engage in investment and business activities in Vietnam according to the forms prescribed in law on investment, trade or enterprises and does not establish any representative office or branch in Vietnam in accordance with regulations of law on trade or enterprises.
Thus, “customs-controlled area” means a geological area in the territory of Vietnam that is established in accordance with regulations of Vietnam law and international treaties to which the Socialist Republic of Vietnam is a signatory and the exchange of products between this area and the remaining territory of Vietnam or foreign countries are considered as import and export activities.
What is the Free trade zone in Vietnam?
Pursuant to the provisions of Article 4 of the Law on Import and Export Duties 2016 as follows:
Article 4. Definitions
For the purpose of this Law, the terms below are construed as follows:
1. Free trade zone means an economic zone located within Vietnam’s territory, established in accordance with law, having a definite geographic boundary, and separated from the outer area by hard fences in order to facilitate customs inspection and customs control by the customs authority and relevant agencies with regard to exports and imports, inbound and outbound vehicles and passengers; the trading relationship between the free trade zone and the outside area is consider exportation and importation.
2. Mixed duty means the total amount of proportional tax and fixed tax.
3. Proportional duty means tax expressed as a percentage of the taxable value of exports and imports.
4. Fixed duty means a fixed amount of tax imposed upon a unit of exports and imports.
5. Anti-dumping duty means an additional import duty imposed upon dumped imports in Vietnam that cause or threaten to cause considerable damage to domestic manufacturing or prevents the formation of domestic manufacturing.
6. Countervailing duty means an additional import duty imposed upon subsidized goods imported into Vietnam that causes or threatens to cause considerable damage to domestic manufacturing or prevents the formation of domestic manufacturing.
7. Safeguard duty means an additional import duty that is imposed in case the quantity of goods imported into Vietnam is above the acceptable level and thus causes or threatens to cause considerable damage to domestic manufacturing or prevents the formation of domestic manufacturing.
Thus, Free trade zone means an economic zone located within Vietnam’s territory, established in accordance with law, having a definite geographic boundary, and separated from the outer area by hard fences in order to facilitate customs inspection and customs control by the customs authority and relevant agencies with regard to exports and imports, inbound and outbound vehicles and passengers; the trading relationship between the free trade zone and the outside area is consider exportation and importation.
Can the foreign EPEs temporarily import and re-export goods into Vietnam?
According to Article 41 of the Law on Foreign Trade Management 2017, other forms of temporary importation and re-exportation are as follows:
Article 41. Other forms of temporary importation
1. Except for the temporary importations prescribed in Article 39 of this Law, a trader may import temporarily products that are not included in the list of prohibited exports and imports; products that are suspended from export or import according to the contract with a foreign country to maintain, rent, lend or use these products for another purposes for a certain period of time and re-export these products from Vietnam.
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3. The time limit for temporary importation shall comply with the agreement between the trader and the partner and be registered at the customs authority’s premises where procedures for temporary importation are gone through.
4. If temporary imports are withdrawn for domestic consumption, they shall comply with regulations of law on the import management prescribed in this law and other relevant regulations of law.
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At the same time, according to Clause 1, Article 57 of the Law on Foreign Trade Management 2017, the application of measures to manage imported goods of customs-controlled area is as follows:
Article 51. Management of the processing of products of foreign traders
1. A trader may process legal products of foreign traders, except for products that are included in the list of prohibited or suspended exports and imports.
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Pursuant to Clause 1, Article 30 of Decree 82/2018/ND-CP 2018 of the Government as follows:
Article 30. Particular regulations applied to export processing zones and export processing enterprises
1. Export processing zones and export processing enterprises shall be subject to regulations applicable to separate customs areas and non-tariff zones, except for particular regulations applicable to non-tariff zones within bordergate economic zones. If export processing enterprises may be exempted from applying for the Certificate of investment registration, such exemption shall be specified in their investment registration certificates or written document issued by the competent investment registry. The investment registry shall be held responsible for gathering opinions from the competent customs authorities on the capability to satisfy conditions of the customs inspection and supervision before issuing the investment registration certificate or confirmation in writing to investors.
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From the above provisions and based on Official Dispatch 1400/TCHQ-TXNK dated April 21, 2022 of the General Department of Customs on import duty on leased or lent goods from EPEs (export processing enterprises), in case an export processing enterprise leases or lends its goods to a domestic enterprise for production of main products of the export processing enterprise, the export processing enterprise shall open the declaration of temporary export and the domestic enterprise shall open the declaration of temporary import; upon termination of the lease or lending contract, the domestic enterprise shall follow procedures for re-export of the leased or lent goods, and the export processing enterprise shall follow procedures for re-import of these goods.
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