Restricting scrap import can affect many businesses

VCN - According to the Vietnam Confederation of Commerce and Industry (VCCI), regulations restricting scrap import can affect the operations of many businesses, so they need to be regulated according to a specific long-term roadmap.
Violations in scrap import handled Violations in scrap import handled
Removing problems on effective date of certificate of scrap imports Removing problems on effective date of certificate of scrap imports
Regulations on environmental protection deposit for scrap imports Regulations on environmental protection deposit for scrap imports

The Ministry of Natural Resources and Environment is collecting comments on the draft Decree amending and supplementing a number of articles of Decree 08/2022/ND detailing a number of articles of the Law on Environmental Protection. VCCI commented that, basically, the Draft had added many regulations to reform administrative procedures, reduce procedures or clarify the scope of subjects that must be implemented, and decentralize procedures.

However, based on comments from businesses, VCCI has raised a number of concerns that need to be considered, including regulations related to restricting the import of scrap and plastic scrap as production materials. VCCI assessed that these regulations were not consistent with the Law on Environmental Protection, because this Law did not assign the Government to regulate a roadmap to limit the import of raw materials or conditions for output products of businesses.

Officials at the Cai Mep Port Border Gate Customs Branch inspect imported scrap goods. Photo: N.H
Officials at the Cai Mep Port Border Gate Customs Branch inspect imported scrap goods. Photo: N.H

In addition, regarding scrap as raw production materials in general, the Draft stipulates that establishments using imported scrap can only import a maximum of 80% of their usage needs, and the rest must use domestically collected scrap from January 1, 2025. According to VCCI, this regulation may affect the operations of many businesses.

According to businesses, if imported scrap is used properly, it will be recycled into raw materials to produce industrial products to serve the economy, saving costs and reducing raw material exploitation. In many cases, importing scrap also helps businesses reduce difficulties in finding input materials due to tensions from the supply of raw minerals.

VCCI said that this regulation might be idea of the drafting agency that wanted to promote businesses to recycle domestic scrap.

However, this required businesses to form a domestic scrap collection chain, while in reality, an official collection chain had not been formed in Vietnam. At the same time, there were no regulations binding the responsibilities of subjects generating waste.

Thus, VCCI assessed that manufacturing enterprises would have difficulty establishing a domestic scrap collection chain and it might take many years for this chain to operate effectively, while the source of raw materials for production is limited.

Similarly, regarding importing plastic scrap as raw materials for production, the Draft stipulates that businesses are not allowed to import plastic scrap as raw materials to produce recycled plastic pellets from December 31, 2024. VCCI also assessed that the regulations are not consistent with the actual operations of the plastic industry.

Recycled plastic pellets and finished plastic products are an upstream and downstream value chain that depend and complement each other, but are two different fields with different production processes and technological know-how. Recycling businesses have no experience in producing finished plastic products, and conversely, businesses producing finished products also have no experience in producing recycled plastic pellets.

In the current context, the plastic industry's raw material sources mainly rely on imported raw materials, so businesses reflect that this regulation will have an immediate impact on the value chain of the plastic industry, causing businesses producing finished products must become increasingly dependent on imported plastic pellets, thereby reducing competitiveness and making it difficult to take advantage of tariff incentives in free trade agreements, or they may lose many export orders because of meeting recycled plastic rate as required by importers in developed countries.

From the above issues, VCCI recommended that restricting scrap import should be considered for the development of the industry with a full consultation process and a long-term conversion roadmap along with the development of the domestic collecting and recycling system, and VCCI proposed removing these regulations.

By Huong Diu/ Binh Minh

Related News

Regulating goods across Huu Nghi International Border Gate during peak times

Regulating goods across Huu Nghi International Border Gate during peak times

VCN – In order to reduce the pressure on customs clearance of import and export goods for the international border gate pair during peak times, the management agency of Lang Son (Vietnam) has just discussed with the management authority of Pingxiang (China) to strengthen coordination in regulating the means of transporting goods of enterprises on both sides.
Khanh Hoa Customs reaches revenue target 1 quarter early

Khanh Hoa Customs reaches revenue target 1 quarter early

VCN - Many key import items increased sharply, along with efforts in trade facilitation, tax debt collection, so in just 9 months of 2024, Khanh Hoa Customs Department completed the state budget revenue target.
3 items have a big impact on the budget revenue of Ho Chi Minh City Customs

3 items have a big impact on the budget revenue of Ho Chi Minh City Customs

VCN - Automobiles, petroleum, and steel are three items that account for nearly 35% of the total state budget revenue of Ho Chi Minh City Customs Department. Therefore, fluctuations in these revenue sources will greatly impact the state budget revenue of the entire Department.

Latest News

"One law amending four laws" on investment to decentralize and ease business challenges

"One law amending four laws" on investment to decentralize and ease business challenges

VCN - According to the Government, the draft Law amending and supplementing certain provisions of the Planning Law, Investment Law, Law on Investment under Public-Private Partnerships (PPP), and Bidding Law (referred to as "One law amending four laws") focuses on amending conflicting regulations that are causing obstacles, to facilitate investment, production, and business activities.
One law amending seven financial laws: New driving force for economic growth

One law amending seven financial laws: New driving force for economic growth

VCN - Draft 1 of the Law amending 7 laws in the financial sector has been officially submitted and discussed at the 8th session of the 15th National Assembly. According to the Law-making program, the Law will be developed and promulgated following a simplified procedure and will be approved at this session. The simultaneous amendment of many provisions in the laws in the financial sector and their early approval demonstrate the determination and great efforts of the National Assembly, the Government, and the Ministry of Finance in creating a system of open and appropriate policies, promoting investment resources in the economy, thereby promoting economic growth in the new period.
Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

VCN - In the short term, applying 5% VAT on fertilizers may increase selling prices, but in the long term, farmers will benefit from this policy. When the fertilizer manufacture is deducted input tax, it will help reduce investment cost and production cost.
Tax, fee, and land rent exemption, reduction, and deferral policies: a driving force for business recovery and growth

Tax, fee, and land rent exemption, reduction, and deferral policies: a driving force for business recovery and growth

Recently, the implementation of a series of policies on tax, fee, and land rent exemption, reduction, and deferral has provided timely support for businesses to recover and develop, thereby making positive contributions to economic growth.

More News

Revamping commodity management and trade protection

Revamping commodity management and trade protection

VCN - Completing commodity management policies combined with applying trade defense measures plays an important role in protecting the interests of businesses and the Vietnamese economy. Close coordination between management agencies not only helps prevent trade fraud but also creates favorable conditions for exporting businesses, minimizing risks from anti-dumping lawsuits.
Tax support policy is a "lift" for business bounceback

Tax support policy is a "lift" for business bounceback

VCN- Sharing with Customs Magazine, economic expert, Associate Professor, Dr. Dinh Trong Thinh highly appreciated the effectiveness of tax and fee reduction measures implemented by the Government and the Ministry of Finance. These policies not only enable businesses to reduce input costs and increase profits, but also promote consumption and production of businesses.
VAT policy for on-the-spot imports

VAT policy for on-the-spot imports

VCN- The General Department of Vietnam Customs has instructed Dong Nai Food Industry Corporation on VAT policy for imported tobacco leaves separated from stems.
Applying tax on animal feed ingredient faces problems due to specialized regulations

Applying tax on animal feed ingredient faces problems due to specialized regulations

VCN - The unified application of regulations of specialized legal documents related to value-added tax (VAT) policies on imported raw materials for animal feed has caused many problems. Notably, the accurate identification for imported raw materials for animal feed not only causes difficulties for the enterprise but also for the enforcement authority.
Ministry of Finance proposes to choose the option of reducing land rent by 30% in 2024

Ministry of Finance proposes to choose the option of reducing land rent by 30% in 2024

VCN - The Ministry of Finance has just completed the draft Decree of the Government regulating the reduction of land rent in 2024. Accordingly, in the latest Draft, the Ministry of Finance directly proposed to choose the reduction level according to option 2 of 30%.
Ensuring reasonableness upon enforcement of regulations in "1 law amending 7 laws"

Ensuring reasonableness upon enforcement of regulations in "1 law amending 7 laws"

VCN - According to the representative of the Vietnam Chamber of Commerce and Industry (VCCI), the Ministry of Finance and the National Assembly Committees are urgently collecting opinions to complete the draft Law amending seven Laws, to ensure that the issued regulations are reasonable and remove difficulties for businesses.
Ensuring global trade security requires cooperation, exchange and processing of information before the goods arrive

Ensuring global trade security requires cooperation, exchange and processing of information before the goods arrive

VCN - As import and export activities increase, security risks also increase. Therefore, to meet the requirements of both strict security control and shortening clearance time, facilitating trade, one of the effective solutions is to cooperate, exchange and process information before the goods arrive.
New regulations on foreign indirect investment in Vietnam drafted

New regulations on foreign indirect investment in Vietnam drafted

The State Bank of Vietnam (SBV) is drafting a circular to better manage foreign investment protocols and hopefully make them speedier.
Considering amending regulations on suspension from exit due to tax arrears

Considering amending regulations on suspension from exit due to tax arrears

VCN - To facilitate the implementation of suspension from exit, the General Department of Taxation directs specialized units to study and amend and supplement current regulations to ensure both improving the efficiency of tax debt collection and creating conditions for enterprises and taxpayers to develop stable production and business as well as facilitate travel and trade activities.
Read More

Your care

Latest Most read
"One law amending four laws" on investment to decentralize and ease business challenges

"One law amending four laws" on investment to decentralize and ease business challenges

VCN - According to the Government, the draft Law amending and supplementing certain provisions of the Planning Law, Investment Law, Law on Investment under Public-Private Partnerships (PPP), and Bidding Law (referred to as "One law amending four laws") fo
One law amending seven financial laws: New driving force for economic growth

One law amending seven financial laws: New driving force for economic growth

VCN - Draft 1 of the Law amending 7 laws in the financial sector has been officially submitted and discussed at the 8th session of the 15th National Assembly. According to the Law-making program, the Law will be developed and promulgated following a simpl
Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

VCN - The representative of the Vietnam Fertilizer Association cites data from the Ministry of Finance, as saying that about VND10,000 billion of VAT has not been deducted from business expenses from 2015 to present.
Tax, fee, and land rent exemption, reduction, and deferral policies: a driving force for business recovery and growth

Tax, fee, and land rent exemption, reduction, and deferral policies: a driving force for business recovery and growth

Recently, the implementation of a series of policies on tax, fee, and land rent exemption, reduction, and deferral has provided timely support for businesses to recover and develop, thereby making positive contributions to economic growth.
Revamping commodity management and trade protection

Revamping commodity management and trade protection

Completing commodity management policies combined with applying trade defense measures plays an important role in protecting the interests of businesses and the Vietnamese economy.
Mobile Version