Vietnam Customs proactively participate in negotiation and develop AHTN Nomenclature

VCN - Vietnam Customs has actively participated in negotiating and developing the ASEAN Harmonized Tariff Nomenclature (AHTN) to fulfill its obligations as a member agency. Customs Magazine interviewed Mrs. Dao Thu Huong (pictured), Deputy Director of the Import and Export Duty Department, General Department of Vietnam Customs, to better understand the results that Vietnam Customs has achieved in this work.
Dao Thu Huong (pictured), Deputy Director of the Import and Export Tax Department, General Department of Vietnam Customs
Mrs. Dao Thu Huong (pictured), Deputy Director of the Import and Export Duty Department, General Department of Vietnam Customs

Could you please tell us the role and contributions of Vietnam Customs in building and implementing integration commitments related to the AHTN Nomenclature?

Within the realm of international cooperation and trade facilitation, Vietnam Customs has consistently demonstrated a strong commitment to active participation and close collaboration with its ASEAN member counterparts.

One of the important cooperation contents of ASEAN, the negotiation and development of the ASEAN Harmonized Tariff Nomenclature (AHTN) at a detailed level of 8 digits stands as a pivotal ASEAN cooperation initiative with a profound impact on import-export activities. The AHTN aims to harmonize the Nomenclature and Tariff Schedule among the 10 ASEAN countries, standardize annotations, codes, and product descriptions. These efforts are geared towards promoting the free movement of goods within the region, fostering ASEAN economic integration, and contributing to the development of the ASEAN Free Trade Area.

Vietnam Customs has played a crucial role in the AHTN process, actively participating in over 10 AHTN Nomenclature Negotiation Sessions during the 2019-2022 period. It meticulously compiled the opinions of relevant ministries and departments and delegated leading experts in commodity classification and tariff schedule development to engage in the negotiations. As an active and responsible ASEAN member, Vietnam Customs has consistently taken the initiative to coordinate with the ASEAN Secretariat and other member countries. It has proposed amendments and supplements to the AHTN to safeguard Vietnam's interests while achieving consensus within the bloc. In the implementation phase, Vietnam Customs has been proactive in reviewing and assessing unresolved issues in the Nomenclature. It engages in discussions with ASEAN countries to find solutions that address the difficulties and obstacles faced by businesses in commodity classification and tariff application. These efforts contribute to strengthening risk control, facilitating trade, and increasing intra-ASEAN trade turnover. In recognition of its proactive role, Vietnam has been selected by ASEAN countries to nominate representatives to teach and train ASEAN customs officials on the AHTN 2022 at workshops.

How has the construction, amendment, supplementation and implementation of the AHTN Nomenclature facilitated the import and export of goods within and outside the ASEAN region?

The AHTN Nomenclature is the common standard of 10 ASEAN countries on commodity codes and Tariffs to apply tariff policies, rules of origin, risk management, trade statistics and is also the basis for Apply specialized management policies (such as control of dual-use goods, environmental protection, food security, chemical weapons...). ASEAN countries also use the AHTN Nomenclature to negotiate and implement tariff reduction commitments within the framework of bilateral and multilateral agreements.

The amendment and supplementation of the AHTN Nomenclature plays an important role for ASEAN to update changes in science and technology in the world, new generation trade trends to facilitate trade and quick customs clearance. quickly, and at the same time strengthen management and control measures for risky items related to security, national defense, public health...

Specifically, during the negotiation process to build the AHTN2022 Nomenclature, ASEAN countries have added detailed descriptions of many product groups such as electronic cigarettes, HCFCs, scrap and electrical and electronic waste... in order to Strengthen strict control measures through descriptive identification in new categories. Within the framework of this cooperation, Vietnam Customs proactively proposed amending the AHTN2022 Nomenclature to resolve problems with goods classification in the region such as clarifying the contents of liquid and gel goods used for electronic cigarettes, superphosphate used as animal feed, aluminum spacer...

At the same time, on the basis of the AHTN list, ASEAN has been negotiating multilateral agreements such as ASEAN-EU, ASEAN-Canada... This brings great benefits to import-export enterprises when Vietnamese goods Facilitate movement within ASEAN and with countries signing trade agreements.

Can you specifically state the results in the process of negotiating, building and implementing the AHTN Nomenclature in Vietnam?

I think that cooperation in the field of import and export has been enhanced, contributing to increasing intra-ASEAN turnover. In particular, Vietnam's import-export turnover with ASEAN countries from the time of implementing the AHTN Nomenclature in 2003 to now has grown significantly.

Statistics show that export turnover increased from US$2.95 billion in 2003 to US$32.57 billion in 2023 (increases 11 times) and import turnover rises from US$5.95 billion in 2003 to US$40.9 billion in 2023 (grows 6 times). This demonstrates the strong growth in Vietnam's trade cooperation relations with ASEAN countries.

In addition, the proportion of Vietnam's import-export turnover with ASEAN countries compared to the total import-export turnover among the 10 ASEAN member countries increased significantly, from 4.1% in 2003 to 9.41%. 2022 (doubled). That demonstrates Vietnam's increasingly important role in trade within ASEAN.

In particular, Vietnam's total import-export turnover with the world compared to ASEAN's total import-export turnover with the world will increase from 5.21% in 2003 to 18.97% in 2022 (tripling), showing Vietnam's trade growth rate compared to other countries in ASEAN.

To meet the roadmap for reviewing commitments, in your opinion, in the coming time, how will Vietnam Customs carry out the work of classifying goods and pre-determining codes?

Currently, the General Department of Customs (Import-Export Duty Department) actively participates in the Technical Working Sub-Group on Goods Classification (TSWGC) within ASEAN. The TSWGC sub-group is responsible for reviewing and developing the AHTN Nomenclature based on the HS List and resolving problems with goods classification at the 8-digit level in the ASEAN region. Accordingly, Vietnam Customs will coordinate with ministries and branches to review and deploy specialized management lists on the basis of complete compliance with the AHTN Nomenclature. At the same time, developing a comprehensive AHTN negotiation program and plan for the HS 2028 version on the basis of synthesizing the management needs of relevant ministries and branches, to ensure Vietnam's interests in the process of harmonization of commodity codes for deep integration into regional and international trade.

In parallel with the negotiation plan, Vietnam Customs is making efforts to focus on building a smart IT system to facilitate the goods clearance process. We aim to perfect the functions of analyzing and controlling the classification of goods, applying tax rates on the basis of the AHTN Nomenclature, allowing the system to automatically warn customs officials about cases of false declaration of HS codes, tariff rates; supporting warnings for items that have had results of analysis and classification announced, pre-determination of codes, and official dispatches with classification instructions; design the system to be able to look up declarations following the flow of procedures such as before clearance, clearance and post-clearance.

In addition, Vietnam Customs will intensify its efforts to disseminate guidelines to the business community on goods classification, tariff application, and AHTN compliance to ensure fulfillment of ASEAN member countries obligations.

By Hồng Nụ/Thanh Thuy

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