Tay Ninh: Many problems in handling cigarette smuggling

Perpetratorsand exhibits arrested by the Tay Ninh Customs Department. Photo: Van Hieu.

In the first 9 months of 2016, functional forces and Steering Committee 389of Tay Ninh province discovered and seized 681,479 packs of cigarettes. Of these, the Tay Ninh Customs forces have discovered and seized 7,706 packets andprosecuted 2 criminal cases. The subjects of criminal prosecution are Nguyen Anh Tuan (born in 1979), living in Chau Thanh district, Tay Ninh province who controlledhis tractortruck hiding 2,000 packs of cigarettes underneath the rear hook and Tran Vu Toan (born 1974, fromCao Lanh district, Dong Thap province) hiding4 cartons with bagsinside containing a total of 2,000 White Jet brand cigarette packets,...

Mr. Huynh Van Duc, Director of the Tay Ninh Customs Department, Deputy Head of the Steering Committee 389 of Tay Ninh province said, although the functional forces havetaken a heavy line with cigarette smugglers, because of high interest and strong interest in the productfrom the market, tobacco smuggling remains complicated with increasing severenature and scale.

Specifically, smuggled cigarettebrands Hero sell for 8,000 vndper pack compared to to 10,000 vnd/ packet on the legal market, Jet sell for 10,000vndcompared to 12,000 vnd/packet, Esse sell for 4,000 vnd/packet, while legal cigarettes are applied with high tariffs (special consumption tax of 65%, VAT 10%, 135% for import tax, corporate income tax of 22%, the harm prevention of tobacco Fundwith 1.5%, and warning pictures should be printed.) with high a profitability gap making the perpetrators use sophisticated tactics to illegally transport cigarettes from Cambodia to Vietnam for consumption.

Meanwhile, the sanctions are overlapping and insufficient, making it hard forhandlingsmugglers. Clause 2, Article 25 of Decree 124/2015/NĐ-CP amending and supplementing some articles of Decree No. 185/2013/NĐ-CP of the Government on sanctioning of administrative violations in commercial, production and trade activitiesrelating to counterfeit goods, prohibited goods and to protect the interests of consumers, has been revised to reduce the amount of prohibited goods (smuggled cigarettes) to transfer for criminal prosecution, from 1,500 packets as before down to 500 packets. However, so far there are no guidelines defining what is the shipment size to be appointed inpenalty range, so when transferingthe dossier to the conducting agency for proceedings, it is stuck by the provisions of Clause 2, Article 7 at the joint Circular No.36/2012 dated 18th, April, 2012 of the Ministry of Industry and Trade - Ministry of Public Security - Ministry of Justice-People's Supreme Court - People’s Supreme Pricuracy (regulated quantity from 1,500 packs to less than 4,500 packs are the large bulk), so, cases are unable to go tocriminal prosecution.

Also, according to Steering Committee 389of Tay Ninh province, Decree No. 59/2006/NĐ-CP of the Government regulating detailsof the Commercial Law regarding banned, restriced and conditionalgoods and services from business, (as amended and supplemented by Decree No. 43/2009/NĐ-CP and consolidated under Document No. 19/VBHN-BCT dated 9th of May, 2014), fireworks, cigarettes, cigars and other types of smuggled finished cigarettesareon the list of banned goods from trading. However, under the provisions of the Investment Law 2014 there are noregulations to prohibit trading smuggled cigarettes, but regulation on producing and trading finished cigarettes as aconditional business and investment. In particular, the Association of Tobacco said that some provisions in the Criminal Code in 2015 have adversely changed the fight with this issue.

Accordingly, smuggled cigarettes are in group B. For goods in Group B, for criminal processing under article 190 and 191, the value of illegal goods must be at least 100 million vndto be applied the penalty range 1; Goods worth from or more than 300 million vndfor the penalty range 2 and 500 million vndfor the penalty range 3. For smuggled cigarettes, this level is very high.

Due to the above,the inconsistentlegal documentsidentifying"prohibited goods" and considering criminal responsibility for thosewho are transporting, storing fireworks, and smuggled cigarettes,make it difficult for agencies to apply the law.