Authorized Economic Operator enjoys strong incentives
Hanoi Customs manages 12 authorized economic operators | |
Customs of ASEAN countries recognize each other as authorized economic operators |
Garment 10 Corporation is recognized as Authorized Economic Operator for 8 years. Photo: T.Binh. |
Typical companies in import and export activities
Deputy Director of Post Clearance Audit (under the General Department of Vietnam Customs) Nguyen Sy Hoang said in 2022, Authorized Economic Operators (AEOs) only account for small proportion of about 85,000 import-export firms but account for about 36% of total turnover of the country with about US$ 266 billion. These operators have engaged in diversified areas such as industry, export processing, agriculture manufacturing.
The data shows that the AEOs are typical operators in imports and exports with large import-export turnover.
However, to be recognized as an AEO, the operator must meet requirements and be gone through a strict appraisal and evaluation process.
According to provisions in Circular 72/2015/TT-BTC in 2015 of the Ministry of Finance, one of the conditions to be recognized as an AEO is related to import and export turnover.
Specifically, the enterprise must achieve import and export turnover of US$ 100 million/ year or more; export turnover of goods made in Vietnam of US$ 40 million/year or more; export turnover of products as agricultural and aquatic products produced or raised or grown in Vietnam of 30 million US$/year or more.
For the customs broker, the number of declaration implemented by the customs broker reached 20,000 declarations/year or more.
The export and import turnover and declarations are the average data of two consecutive years from the date of submitting the application by the enterprise (the turnover and declaration exclude the turnover entrusted export and import).
In addition, enterprises certified by the Ministry of Science and Technology as high-tech enterprises under the provisions of the Law on High Technology are not required the conditions on import and export turnover by the Customs.
Enterprises must satisfy other conditions such as complying with regulations in Customs and Tax laws; e-customs and e-tax procedures; payment for exported and imported goods; internal control system; and accounting and auditing laws.
Need to well comply with the law
When the enterprise meets requirements and is recognized as the AEO by the General Department of Vietnam Customs, it will enjoy incentives.
Circular 72 provides regulations on applying the AEO program, as saying that the exported and imported goods of the AEO or authorized project or authorized customs broker named on the declaration will enjoy priority on customs procedures, inspection and supervision for all import and export regimes, and all customs units across the country.
In addition to the priorities in Circular 72, the AEO is also given other priorities in customs management for imports and exports.
The AEO will be exempted from document inspection and physical inspection of goods; cleared goods by incomplete declaration; given priority in customs procedures; specialized inspection; tax procedures; on-spot import and export procedures; post-clearance audit.
The incentives contribute to promoting production and business activities of the AEO, thereby implementing quick customs clearance, creating reputation with customers and reducing cost.
The AEO must comply with the law to maintain the recognition of the AEAO and enjoy incentives. However, after being recognized as the AEO, some operators have not yet complied with regulations. Therefore, the Customs has detected and suspended the AEO regime.
Over the past 12 years, some AEOs have been suspended the AEO regime by the General Department of Vietnam Customs such as POSCO VST Co., Ltd., Saigon Precision Co., Ltd., Pouchen Vietnam Co., Ltd., Au Vung I Seafood Processing Import and Export Joint Stock Company, PetroVietnam Oil Joint Stock Corporation…
These AEOs have been suspended the AEO regime because they fail to comply well with the law or no longer meet regulations to participate in the AEO program.
The suspension of the AEO regime will make operators lose great incentives given by the Customs, affect their reputation with partners, especially when Vietnam Customs has signed the AEO mutual recognition agreements with customs administrations of ASEAN Member States, and has continued to negotiate to sign agreements with other major trading partners.
Therefore, the Customs recommends that the AEOs must always comply with the law especially provisions in Article 26, Circular 72/2015/TT-BTC (supplemented in Clause 10, Article 1 of Circular 07/2019/TT-BTC, taking effective from March 28, 2019).
Than Duc Viet, General Director of Garment 10 Corporation: Garment 10 Corporation has been recognized as an AEO since 2015. Thanks to becoming an AEO, the Corporation’s reputation has been enhanced not only with domestic export businesses but also with major partners in the Europe and Japan. In addition, motivated by the priorities in customs procedures, the reduced clearance time, storage time and costs, the Corporation has actively made better plans. To maintain regular presence on the list of AEOs, Garment 10 Corporation always meets requirements and complies with the law; innovates and improves business operations; and applies modern management measures and internal control… |
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