Facilitating enterprises in C/O declaration and submission, but paying attention to post-audit

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Mr. Dao Duy Tam, Deputy Director of Customs Supervision and Administration Department, General Department of Customs, interviewed by Customs Magazine about outstanding reform regulations in Circular 33.

What are the outstanding reform regulations in Circular 33, sir?

Circular 33 was issued by the Ministry of Finance to replace 4 circulars including: Circular No. 38/2018/TT-BTC; Circular No. 62/2019/TT-BTC; Circular No. 47/2020/TT-BTC; Circular No. 07/2021/TT-BTC with many reforming regulations. The first is the regulation on origin declaration for exported goods. Circular 33 is more specific, for example, the case of determining the origin of Vietnam will declare how and the case of unidentified will declare how.

The next new point of the Circular is the regulation on late submission of documents of goods’ origin. Circular 33 does not stipulate the late payment declaration, but based on the validity period of the certificate of origin submitted by the enterprise. If the certificate is still valid, a special preferential tax rate will be applied at that time. Particularly for imported goods subject to the application of tariff quotas or application of trade remedies, enterprises will be entitled to delay payment within 30 days. As for other cases such as: goods on the list subject to control in terms of environmental sanitation, labor safety, public health or goods subject to notification under the Resolution of the United Nations Security Council, it must be paid immediately at the time of carrying out the procedures.

Another new feature in Circular 33 is the provision on guarantee for tax payment in case there is no certificate of origin at the time of customs clearance. How the guarantee is applied is specified in Article 42 of Circular 38/2015/TT-BTC.

In addition, the regulation on the case of refusing documents of goods’ origin is also a new point in Circular 33. Accordingly, at the time of carrying out import procedures, if the customs office detects: the certificate of origin has expired according to the provisions of law and according to the notification of the exporting country's authority about issuing the C/O that does not guarantee to meet the origin criteria or it is not effective to apply the special preferential tax rate, it will be rejected immediately.

Besides, Circular 33 also amends and supplements regulations on handling cases with differences in HS codes; deduct the documents of origin of goods.

Notably, the highlight of Circular 33 that is of particular interest to businesses is the regulation allowing the submission of proof of origin in the form of an electronic data sheet or an electronic document that is transferred from paper document. Or in case the proof of origin is issued on the National Single Window, the enterprise is not required to submit it, but only declares the reference number or the serial number of the certificate of origin on the customs declaration for preferential treatment.

Currently, the General Department of Customs has been actively organizing activities to disseminate new regulations in Circular 33. Could you tell me what issues businesses need to pay attention to for effective implementation?

Right after the Circular was issued, we also received a lot of requests and coordinated with the units to organize training for businesses as well as local customs. Through the training sessions, there are a number of outstanding issues that businesses are very interested in. Because the basic changes in the Circular may lead to different interpretations and businesses really want the Customs to clarify.

For example, in the matter of submitting scans, do businesses have to submit paper copies or keep documents? In this regard, the Customs authority has clearly explained that enterprises that have submitted scanned documents are not required to submit paper documents. However, enterprises will be responsible for keeping the paper copies to serve the inspection of the Customs.

The second problem is the debt declaration of certificates of origin for petroleum products. Particularly, petroleum is a special commodity subject to state management and control in price. According to current regulations, in order to have a basis for calculating the base price and determining the base price for petroleum products, it must be based on information on the customs declaration. Therefore, for the petroleum products only, if the enterprise owes C/O, it still has to declare the debt so that the authorities have a basis to determine the base price when it is announced to consumers.

Another issue that businesses are also very interested in is the declaration to change the purpose of use for the certificate of origin. In case of changes in the enterprise HS code, can additional declarations be made? or after the post-customs clearance inspection, the customs office determines that the enterprise's imported goods are not eligible for incentives, the enterprise may supplement the C/O for tax calculation at the special preferential tax rate? or in the case that the declared goods change the purpose of use and are no longer in their original condition, will the enterprise be entitled to incentives? In the above cases, enterprises are entitled to a preferential tax rate if the proof of origin submitted by the enterprise has a valid period of time...

The problems faced by enterprises are answered directly by the Customs at the seminars, and at the same time, they are synthesized to have specific guiding documents to ensure that the enterprises and the Customs authorities agree on the understanding and agree on performance manner.

From the perspective of the management agency, is there any note for the local Customs when implementing Circular 33 to create favorable conditions for businesses but still ensure the management, sir?

During the drafting of the Circular, the drafting committee consulted with local Customs units and raised concerns. For example, the problem is using fake certificates of origin, or implementing regulations related to determining criteria to enjoy preferential tax rates...

During the development of the draft, the drafting committee explained, or after the Circular was issued, in the seminars and training sessions, it was explained very clearly, along with creating facilitation, the Customs authority must also strengthen management measures. In the case that we have facilitated the customs clearance, there must be post-clearance management measures. Therefore, for these Circulars during the implementation process, we also note that local customs must strengthen post-clearance inspection measures. For imported shipments, when enterprises submit scanned documents, they may be exempted from the document check and physical inspection, so the Customs authority must strengthen the inspection at the post-inspection stage to ensure promptly detect cases of origin fraud when doing customs procedures.

Thank you Sir!