Propose to amend Decree 24 to stop illegal gold

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The demand for raw gold to produce golden jewellery is very high.

Last weekend, the Customs Branch of Tinh Bien border gate collaborated with the Customs Control Team under the An Giang Customs Department and the Police Division of economic crime investigation and corruption under the An Giang Police to arrest Mr. Rim Ri Ling, born in 1966 from Cambodia illegally transporting nearly 18 kg of gold, worth more than 16 billion vnd across borders. At the Customs office, Linh also confessed that he had successfully conducted 3 gold smuggling cases across borders. This indicated that gold smuggling operations were very sophisticated.

According to statistics of the districts in HCM City, there are now about 2,000 active gold trading enterprises. Until the end of September 2016, the HCM City Branch of the State Bank of Vietnam issued 428 certificates for the production of golden jewelry to gold trading enterprises. After 4 years of implementation of Decree 24, the volume of gold jewelry produced by domestic enterprises continued to increase over the years. In 2012, there were only 12 companies producing 1,244 kg of gold. However, in 2015, there were up to 386 companies producing more than 13,295 kg of gold. In particular, in the first half of 2016, there were 420 enterprises producing nearly 7,000 kg of gold. In addition, according to statistics from the HCM City Branch of the State Bank of Vietnam, in the first half of the year, the volume of raw gold for production of golden jewelry in HCM City was 126,871 ounces ( nearly 4 tons of gold), worth about 3,229 billion vnd. This indicates that the demand for raw gold to produce golden jewellery is very high.

According to the HCM City Branch of the State Bank of Vietnam, although the gap between the domestic price and the world price of gold has narrowed significantly (compared to 2012), this gap sometimes remains at a high level. Specifically, during the trading session on 30th November 2016, the domestic gold price was listed at around 35.7 million vnd per tael. Meanwhile, the world gold price was converted at 32.6 million vnd per tael. When the gap between the domestic price and the world price of gold is larger, the probability of gold smuggling is greater.

According to Mr. Nguyen Thanh Long, the Chairman of the Gold Trading Association, enterprises have been issued certificates for the production of gold jewelry by the State Bank, but they are not allowed to import raw gold as materials for production. Therefore, they have no choice but to buy illegal raw gold in the domestic market at a higher price than the world gold price, which makes domestic enterprises unable to compete with imported gold or smuggled gold. This has inadvertently raised gold smuggling activities and made State enterprises face the risk of gold smuggling.

The HCM City Branch of the State Bank of Vietnam said that raw gold sources for producing golden jewellery in Vietnam were mainly gold bars and used golden jewellery from companies in the market. There are only a few companies using gold bars as materials to produce jewellery with invoices and vouchers. Meanwhile, the number of raw gold sources in the market for the manufacture of gold jewellery is very large, but very few businesses have legal invoices and vouchers. Decree 24/2012/ND-CP has regulated the legal gold ownership of organizations and individuals recognized and protected under the Law, so it is necessary to determine the origin of raw gold.

Gold smuggling supported by airline staff, intercepted by coordinated forces VCN- An aircraft maintenance technical worker and a senior flight attendant thought that they could carry out ...

Therefore, the HCM City Branch of the State Bank of Vietnam proposed that in addition to the provisions on the use of gold bars for trading and producing gold jewellery, authorities should specify the legal origin of raw materials such as: used gold jewellery of customers and raw gold without invoices and vouchers. Specifically, the State Bank should coordinate with the Ministry of Finance and the Ministry of Industry and Trade to specify the legal documents of the origin of raw gold. Along with that, the Ministries should strengthen physical inspections to handle violations of imported gold across borders. In addition, according to the HCM City Branch of the State Bank of Vietnam, in order to contribute to the development of gold trading companies, the State Bank should have rules to encourage credit institutions to actively lend the raw materials to gold trading companies.