Evading responsibility for re-exporting fake goods

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Imported Chinese ceramic tiles with Vietnamese origin discovered by Saigon port zone 3 Customs Branch. Photo: T.H

Leaving goods and evading responsibility

According to Ho Chi Minh City Customs Department, in 2016, Ho Chi Minh City Customs Department discovered Hui Tong Co., Ltd. importing goods with labels and packaging indicating fake origin, place of production, assembly, and packaging.

The goods are unglazed ceramic tiles imported from China, but have labels and packaging indicating origin and place of manufacture as ‘made in Vietnam’.

Pursuant to Clause 2, Article 4; Point g, Clause 1, Point b, Clause 4, Article 13 of Decree 185/2013/ND-CP dated November 15, 2013 of the Government providing penalties for administrative violations in commercial activities, production and trading of counterfeit goods, prohibited goods and protecting the interests of consumers, the Director of Ho Chi Minh City Customs Department issued a decision to impose a fine VND50 million for Hui Tong Co., Ltd., and request the company to take infringing goods out of Vietnam's territory within 30 days from the issuing date of the decision.

However, according to the Saigon port area 1 Customs Branch, after receiving the sanctioning decision, Hui Tong Co., Ltd neither re-exported the goods nor came to work with the Customs; and did not operate at a registered business address.

Currently, the company's goods are still stored at Cat Lai port and the company stopped operating and closed its tax code on April 3, 2017. Searching on the web portal of the General Department of Taxation and the National Portal on business registration, the Customs agency identified that the company is undergoing dissolution procedures.

Similarly, Van Thanh Bac Trading Transport Import-Export Co., Ltd. was also sanctioned by Ho Chi Minh City Customs Department for administrative violations and forced to re-export infringing goods but the company has not implemented them.

According to Ho Chi Minh City Customs Department, on June 27, 2017, Ho Chi Minh City Customs Department issued Decision 09/QD-HQHCM for Van Thanh Bac Trading Transport Import-Export Trading Co., Ltd on administrative sanction of VND50 million for imports of goods with labels or packages indicating fake origin, place of production, packaging and assembly of goods according to the provisions of Clause 2, Article 4; Point g, Clause 1, Article 13 of Decree 185/2013/ND-CP dated November 15, 2013. The company was requested to bring all the infringing goods out of the territory of Vietnam. However, so far, the company has not yet re-exported the goods.

Difficult to handle infringing goods

Through the above two cases, both enterprises have shown signs of avoiding taking remedial measures to force re-export for infringing shipments.

The two companies have shown signs of evading responsibility in reporting the infringing goods.

The infringing goods of Van Thanh Bac Trading Transport Import-Export Co., Ltd include 7,024 square meters of ceramic tiles stored at VICT port. The Sai Gon Port Zone 3 Customs Branch has repeatedly contacted the company but was unsuccessful.

The branch sent an official letter to the Ho Chi Minh City Department for Planning and Investment to verify the operational status of the company and saw that the company has not been dissolved. In addition, the customs branch worked with the police agency where Van Thanh Bac Company registered its business address and found the company did not operate at this address.

Pursuant to Clause 2, Article 33 of Decree 128/2020/ND-CP on sanctioning of administrative violations in the field of customs: “After 30 days from the expired date of the decision specified in Points a and b, Clause 5, Article 5 of this Decree, the companies have not implemented remedial measures, those specified in Article 28; Clauses 3, 4, 5 Article 29; Clauses 3, 4 of Article 30; Clauses 3, 4, 5, 6, 7 of Article 31 of this Decree shall destroy the material evidence of administrative violations that are goods and articles harmful to human health, livestock, plants and environment, cultural products with harmful content; or confiscate other kinds of material evidence.”

However, the sanctions for the administrative violations of the two companies are in accordance with Decree 185/2013/ND-CP and Decree 124/2015/ND-CP.

Pursuant to Article 7 of Decree 118/2021/ND-CP detailing a number of articles and measures to implement the Law on Handling of Administrative Violations: “The selection and application of legal documents to sanction administrative violations shall comply with the provisions of Article 156 of the Law on Promulgation of Legal Documents.”

To handle the above cases, Ho Chi Minh City Customs Department asked whether the provisions of Decree 128/2000/ND-CP should be applied to confiscate material evidence of administrative violations.

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Currently, the unit has reported and is waiting for the guidance of the General Department of Customs on the legal basis to handle the infringing goods of Hui Tong Co., Ltd. and Van Thanh Bac Trading Transport Import-Export Co., Ltd.