Bac Ninh Customs: Many difficulties in management of processed and manufactured goods for export
![]() | Bac Ninh Customs controls revenues |
![]() | Bac Ninh Customs Branch well controls revenue |
![]() | Bac Ninh Customs listens, supports import-export businesses |
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Officials of Thai Nguyen Customs Branch (Bac Ninh Customs Department) inspect the goods. Photo: Provided by the Customs Branch |
Risk of enterprises ceasing operations
Bac Ninh Customs Department manages enterprises in three provinces of Bac Ninh, Bac Giang, and Thai Nguyen, mainly investors in the field of manufacturing electronic components, electronics and semiconductor components. Notable are a number of very large-scale enterprises, belonging to the system of multinational companies/groups such as Samsung, Canon, Amkor, Goertek, Foxconn, Luxshare.
In the past three years, Bac Ninh Customs Department recorded number of import and export declarations of over 1 million per year. Specifically, in 2021, it was 1,054,990 declarations (1,566,835 declarations including on-site import-export declarations); In 2022, 1,006,937 declarations (1,538,962 declarations including on-site import-export declarations) and in the first 11 months of 2023, it was 910,259 declarations (1,575,763 including on-site import-export declarations). In particular, import-export turnover through the area reached over US$176 billion, bringing Bac Ninh to the top of the country in 2022.
In addition, the number of import-export enterprises increased rapidly, especially export production enterprises and export processing enterprises. There are about 6,000 enterprises, including nearly 1,100 export processing enterprises and export production enterprises, accounting for 18.28%.
Through customs management and supervision of processed and manufactured goods for export and export processing enterprises, Bac Ninh Customs Department has faced difficulties in legal regulations.
Regarding tax policy in Vietnam, for processed and manufactured goods for export, export processing enterprises are enjoying great incentives such as tax exemption and none-tax application if the enterprises meet conditions such as enterprises have production facilities, machinery and equipment, satisfy customs inspection and supervision conditions. However, there is no regulation on time limit to put raw materials and supplies into production from the time of import or the time of processing and producing goods; capital source or conditions on import and export value of the enterprise; conditions for destruction of machinery, equipment, raw materials, supplies, leading to difficulties in carrying out management, monitoring and supervision and making the Customs agency monitor and supervise goods for a long time, depending on the needs of enterprises.
Regarding foreign trade policy, there still exist parallel regulations that are difficult to distinguish in the operations of foreign-invested enterprises, such as business activities under import rights and export rights require licensing in the Certificate of investment registration (according to Decree No. 09/2018/ND-CP); liquidation of surplus raw materials, supplies, machinery and equipment from production activities does not require licensing (according to Article 26 of Decree No. 35/2022/ND-CP, Circular No. 04/2007/TT -BTM which has not yet announced its expiration date...), leading to difficulties in the management of Customs authorities in determining types because there are no specific standards.
In addition, Bac Ninh Customs also said that the procedures and measures for customs management, inspection and supervision in the Decree and Circular have been specific but strict enough to prevent and promptly detect fraudulent acts of enterprises or prevent enterprises from escaping. Specifically, there is a lack of management regulations for Customs authorities to capture information about businesses selling scrap and waste products created from the production process into the domestic market. At the same time, there is a lack of regulations allowing enterprises to autonomously submit settlement reports as needed or enterprises must submit a report on norms to the Customs agency before exporting.
In fact, there are cases where enterprises have their factory lease term almost ended, import-export actives are less than those in the previous period... there is a potential risk of enterprises ceasing operations at any time, even though the agency Customs know this information, but it only monitors and remind, urge, explain their obligations to the Customs and much depend on the compliance of enterprises. However, non-compliant enterprises, the legal representative departs and returns to their home country, leading to the burden for the Customs agency in tracing and verifying even though the business had previously exported products.
Risk of transporting goods to destruction
Reporting shortcomings in the destruction of goods, Bac Ninh Customs said that regulations on supervision of destroyed goods in Article 64 of Circular No. 38/2015/TT-BTC amended and supplemented in Circular No. 39/2018/TT-BTC are allowing authorized enterprises to conduct the destruction of goods without customs inspection and supervision. Meanwhile, Article 43 of the Customs Law stipulates a priority regime for enterprises from exemption of documentary examination and physical inspection of goods and does not stipulate exemption from customs supervision. Therefore, for authorized enterprises with large-scale production activities and large amount of destroyed goods, the enterprises only need to notify the Customs agency of time of destruction and the volume of destroyed goods. This poses a potential risk for the Customs control.
In addition, current law only governs processing enterprises, export production enterprises, and export processing enterprises; there are no regulations on the responsibilities of environmental companies involved in the destruction of goods of enterprises, nor regulations on management plans and methods of Customs authorities for the companies. In fact, when there is information about violations in the handling of goods by processing enterprises, export production enterprises, and export processing enterprises related to environmental companies, there is no legal basis for customs to handle environmental companies.
For example, there is a case of an environmental company transporting goods from processing enterprises, export production enterprises, and export processing enterprises without notifying the Customs authority, but stopping the transportation and conducting documentary examination are very complicated and the authorities have no power to handle the environmental company.
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