Vietnam: When are export processing enterprises importing goods to sell to domestic enterprises not required to carry out the customs procedures?

Main Content

• When are export processing enterprises importing goods to sell to domestic enterprises not required to carry out the customs procedures in Vietnam?
• Are customs procedures required for goods received and dispatched by export processing enterprises for warranty and repair in Vietnam?
• Are goods imported from export processing enterprises into the domestic market subject to export and import duties in Vietnam?

When are export processing enterprises importing goods to sell to domestic enterprises not required to carry out the customs procedures in Vietnam?

Under Clause 2 Article 74 of Circular 38/2015/TT-BTC (amended by Clause 50 Article 1 of Circular 39/2018/TT-BTC) on exports and imports of EPEs:

Exports and imports of EPEs

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2. Customs procedures are not required when goods imported by the EPE are sold to domestic enterprises if taxes on which have been fully paid and regulations on management of exports and imports of non-EPEs are complied with.

Customs procedures are not required for trade of domestic goods purchased by the EPE if tax on which has been fully paid in accordance with regulations applied to non-EPEs. In the cases where an EPE purchases domestic goods subject to export duty, customs procedures have to be completed unless the goods are used as raw materials or supplies and consumed during the manufacture process (e.g. fossil coal burnt during production).

Thus, according to regulations, customs procedures are not required when goods imported by the EPE are sold to domestic enterprises if taxes on which have been fully paid and regulations on management of exports and imports of non-EPEs are complied with.

Are customs procedures required for goods received and dispatched by export processing enterprises for warranty and repair in Vietnam?

Goods received and dispatched by export processing enterprises for warranty and repair in Vietnam are specified in Clause 1 Article 74 of Circular 38/2015/TT-BTC (amended by Clause 50 Article 1 of Circular 39/2018/TT-BTC) as follows:

Exports and imports of EPEs

1. Goods imported for manufacturing of domestic exports by an EPE shall undergo customs procedures and be used for intended purposes, except for the following cases in which the EPE and its partners may decide whether to follow customs procedures:

a) Goods are traded, leased or lent among EPEs. If the goods are raw materials, supplies, machines and equipment under processing contracts between EPEs, follow instructions in Clause 3 Article 76 of this Circular;

b) Goods are building materials, stationery, food, consumables bought from the domestic market to build, serve the operation of the EPE and life of the EPE’s employees;

c) Goods circulated within an EPE or among EPEs in the same export-processing zone;

d) Goods of EPEs of the same corporation or group of companies in Vietnam;

dd) Goods received and dispatched by the EPE for repair, classification, packaging or repackaging.

If customs procedures are nor followed, the EPE shall keep a log of goods received and dispatched under regulations of the Ministry of Finance on goods trading, accounting, and audit. Purposes and sources of supply of goods must also be specified.

Thus, for goods received and dispatched by export processing enterprises for warranty and repair in Vietnam for warranty, repair, or performance of some stages in production activities such as inspection, classification, packaging, and repackaging, export processing enterprises, and their partners may carry out customs procedures or not.

Are goods imported from export processing enterprises into the domestic market subject to export and import duties in Vietnam?

Goods imported from export processing enterprises into the domestic market subject to export and import duties in Vietnam are specified in Clause 11 Article 26 of Decree 35/2022/ND-CP as follows:

Particular regulations applied to export processing zones, export processing enterprises

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10. Through lack of spaces reserved for warehouses or facilities used for storing goods for export processing activities of export processing enterprises inside the perimeter of export processing zones, industrial parks or economic zones, export processing enterprises can outsource spaces outside the perimeter of industrial parks or economic zones to store goods if the conditions specified in clause 2 of this Article are satisfied. Warehouses and facilities for storage of goods that are located outside the perimeter of industrial parks or economic zones may be put to use from the date of the competent customs authority’s certification of the customs inspection and supervision conditions under law on taxes and law on customs.

05 working days after obtaining permission to bring these warehouses and storage facilities into operation from the competent customs authorities, export processing enterprises must notify investment registration agencies of such permission and make any adjustment to the investment project (if any) under law on investment.

11. Export processing enterprises may sell goods into the domestic market. Goods imported from export processing enterprises or export processing zones into the domestic market shall be subject to taxes in accordance with law on customs duties.

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Under the above provisions, goods imported from export processing enterprises into the domestic market are subject to export and import duties in Vietnam.