What are regulations on assurance about the quality of commodity rice for export in Vietnam?

What are regulations on assurance about the quality of commodity rice for export in Vietnam?

Pursuant to Article 17 of the Decree 107/2018/NĐ-CP stipulating assurance about the quality of commodity rice for export in Vietnam as follows:

1. The rice used for export shall comply with the national technical standards and regulations and satisfy the requirements for the rice quality, package, label, maintenance and traceability as prescribed in the law regulations of the importing country; if the importer has other requirements, the exporter shall satisfy them.

2. The rice exporters that export the categories of rice prescribed in clause 3, Article 4 hereof shall carry out the technical procedures, satisfy the technical standards and implement the regulations on production and maintenance of commodity rice which are promulgated by the competent authority.

What are regulations on development of the rice export market in Vietnam?

Pursuant to Article 18 of the Decree 107/2018/NĐ-CP stipulating development of the rice export market in Vietnam as follows:

1. The Ministry of Industry and Trade shall take charge and cooperate with the Ministry of Agriculture and Rural Development and relevant agencies in negotiating to open the rice market and remove the difficulties and barriers of different markets; directing the market information provision, developing trading programs and activities, promoting products, doing trade promotion, and establishing, strengthening and expanding the cooperative relationship between Vietnam and other countries regarding the rice trade.

2. The Ministry of Industry and Trade shall take charge and cooperate with the ministries, sectors and relevant agencies in negotiating and signing the memorandum and agreements on rice trade with foreign countries and territories at ministerial levels. If the foreign countries or territories request the signature of the Government or the enterprise, the Ministry of Industry and Trade shall send a report to the Prime Minister for consideration and decision-making.

3. The Ministry of Agriculture and Rural Development shall take charge and cooperate with the Ministry of Industry and Trade and relevant agencies in monitoring, negotiating and removing the technical and plant quarantine barriers of the importing countries or territories; negotiate and sign the agreements on plant quarantine, technical regulations on quality of rice commodity exported to foreign countries or territories.

4. The Ministry of Finance shall allocate the annual fundings for developing the programs and activities specified in clause 1, clause 2, clause 3 of this Article.

What are regulations on transaction, negotiation, bidding, signing and implementation of the G2G contract in Vietnam?

Pursuant to Article 19 of the Decree 107/2018/NĐ-CP stipulating transaction, negotiation, bidding, signing and implementation of the G2G contract in Vietnam as follows:

1. The government-to-government rice export contract (hereinafter referred to as “G2G contract") is the one signed under the memorandum and agreement between a competent agency of Vietnam’s government and a competent agency of a foreign country or territory, or the one signed under the Prime Minister’s direction.

2. The Ministry of Industry and Trade shall get consultancy from relevant agencies or organizations to assign a key trader to negotiate the G2G contract based on the following criteria:

a. The trader’s export performance within 2 recent years in the expected market of G2G contract transaction.

b. The trader’s export performance within 02 recent years.

c. The transactions with foreign partners who are assigned or to be assigned as key rice exporters.

The trader assigned to take charge of contract transactions before this Decree comes into effect shall continue performing the transactions until the signed contract expires.

3. If more than 02 traders are assigned to act as key traders in the market with G2G contracts, they shall take turns to perform such transactions.

4. The responsibilities of the key trader during transactions, negotiation, bidding, signing and implementation of G2G contract:

a. Take charge in monitoring the market process, taking timely information about the transaction demands, signing the rice export contracts or bidding for the rice import of competent agencies of importing countries.

b. Take charge in developing the plan for transactions and bidding, determining the offer price and taking full responsibility for the contract which has been signed.

c. Send a written report about the ability to carry out transactions, sign contracts, participate in bidding activities, balance the commodity sources and other relevant activities to the Ministry of Industry and Trade, with the aim to guarantee contract implementation; transaction results, contract signing results or bidding results and the plan for implementing the contract.

d. Guarantee to execute the G2G contract which has been signed; handle the entrusted export which is returned or cannot be carried out or cannot be accepted by a trader.

5. The key trader that signs and executes the G2G contract shall export directly 20% of the rice volume specified in such contract. If the key traders take turn in performing the transactions prescribed in clause 3 of this Article, the Ministry of Industry and Trade shall specified the regulation on distribution of 20% of the rice volume specified in the contract.

Based on the criterion specified in clause 6 of this Article and in the regulations promulgated by the Ministry of Industry and Trade, the Vietnam Food Association shall allocate 80% of the remaining rice volume, which is specified in the G2G contract, to the rice exporters for entrusted export.

6. The rice volume specified in the G2G contract shall be allocated to traders for entrusted export based on the following criteria:

a. The trader’s direct export performance within the previous 06 months.

b. Responsibilities for rice delivery under G2G contract previously assigned to traders.

c. The results of building the raw materials area or of the trader’s joint rice production and consumption.

d. The trader's rice procurement performance as guided by the competent agencies or organizations.

7. Vietnam Food Association shall allocate the implementation targets of G2G contracts to the traders according to the criterion specified in clause 6 of this Article; monitor and accelerate the implementation process of such contracts, including the signing and implementation of export authorization contract, and report the aforesaid process to the Ministry of Industry and Trade.

After the Vietnam Food Association allocates the targets, the traders that have been allocated such targets and the key traders shall sign an agreement on the implementation process of G2G contracts, and in such agreement, there must be clear regulations on the rights and obligations of both parties.

Any dispute that arises from the agreement between both parties shall be settled according to the laws.

8. A trader shall not be allocated the implementation targets of G2G contracts under this Article if they:

a. Bid or make transactions for contracts on rice export directly or indirectly to markets with G2G contracts in violation of regulations and the direction of competent authorities.

b. Falsify the documents or commit other frauds to be assigned as the key traders for executing the G2G contracts, allocating the implementation targets of such contracts or being approved to return the authorization targets which have been allocated to them.

c. Do not implement or do not completely implement the export authorization targets which have been allocated to them, have not been in case of force majeure and have not been required to notify the competent authorities according to the laws.

The period for applying the method for not allocating the implementation targets of G2G contract shall be 06 months.

If a trader violates multiple regulations of this Article or violate such regulations for the second time during the aforesaid period, then such period shall be determined based on its total time with regards to each violation being handled.

9. If foreign countries or foreign territories organize an open bidding for traders that are not key traders of G2G contracts, on the basis of receiving the notification from competent agencies of foreign countries or foreign territories, the Ministry of Industry and Trade shall notify such traders of the bidding to carry out bidding transactions and take full responsibilities for the business efficiency.

10. According to the regulations hereof, the Ministry of Industry and Trade shall take charge and cooperate with relevant agencies in guiding the development of criteria for selecting key agencies, the signing and execution of G2G contracts.

Best regards!