Resolution No. 119/NQ-CP dated December 31, 2019 of the Government on emergency measures for enhancement of state management regarding prevention and combat against origin fraud and illegal goods transport
SOCIALIST REPUBLIC OF VIETNAM
Independence – Freedom – Happiness
Hanoi, December 31, 2019
EMERGENCY MEASURES FOR ENHANCEMENT OF STATE MANAGEMENT REGARDING PREVENTION AND COMBAT AGAINST ORIGIN FRAUD AND ILLEGAL GOODS TRANSPORT
Pursuant to the Law on Government Organization dated June 19, 2015;
Pursuant to Decree No. 138/2016/ND-CP dated October 1, 2016 of Government on operating regulations of Government;;
At request of Minister of Industry and Trade,
Along with economic openness and integration, import and export have taken great steps to develop and become a vital factor contributing to economic development and improving manufacturing capacity and living standards of the people. Vietnam has been a member and is negotiating 17 Free Trade Agreements (FTA); during implementation of said FTAs, the majority of goods originating from Vietnam benefit from import duty exemption when exported to other members of the FTA. Meanwhile, as a result of many countries and partners in the world increasingly adopting trade remedies namely antidumping tax, countervailing duties, safeguard tax, etc. with rates so high that lead to many consequences and impair export capabilities of countries which said taxes are imposed on, some enterprises attempt to falsify goods origin and exploit Vietnamese origin of goods to receive benefits and goodwill or to evade trade remedies illegally.
For the past few years, with the aims of steadfastly deterring and stringently taking actions against origin fraud, Government and Prime Minister have directed Ministry of Industry and Trade, Ministry of Finance, Ministry of Public Security and relevant ministries to intensely adopt specific activities and measures, thereby promptly dealing with many violations. In pursuit of aforementioned aims, Prime Minister promulgates Decision No. 824/QD-TTg dated July 4, 2019 approving Schemes for enhancement of state management regarding combat against trade remedy evasion and origin fraud measures. However, due to complications within world economy, particularly the US-China trade war and adjustments to policies of major partner countries in recent years, comes the needs for joint and effective measures to enhance state management regarding deterring origin fraud and illegal transport in order to sustainably develop import and export of Vietnam which in turns will protect and promote development of manufacture and trade in relevant sectors. Government requests ministers, heads of ministerial agencies, Chairpersons of People’s Committees of provinces and central-affiliated cities and heads of relevant agencies and organizations to stringently and effectively direct and implement on the basis of following objectives, tasks and measures:
1. General objectives
- Deter and prevent trade fraud and illegal transport in import and export, proactively detect and stringently take actions against violations if any;
- Promote domestic manufacture and protect reasonable rights and benefits of Vietnamese manufacturers; maintain import development sustainably; attract foreign cooperation and investment in projects involving high technology, high added value, exerting on a large scale and connecting global production and supply chains.
- Increase effectiveness of international economic integration, particularly implementation of new-generation FTAs and ensure strict implementation and guaranteed efficiency according to multilateral frameworks and signed FTAs;
- Protect rights and benefits of Vietnam in international trade.
2. Specific objectives:
- Develop legal systems regarding goods origin, goods origin examination and verification to effectively implement prevention and stringent sanctions against origin fraud, illegal transport and trade remedy evasion.
- Enhance capacity of supervising and examining bodies to effectively implement prevention and stringent sanctions against origin fraud, illegal transport and trade remedy evasion;
- Proactively examine, investigate and verify to detect violations, origin fraud, illegal transports and trade remedy evasion, and stringently take actions against found violations;
- Increase publicizing and raising awareness to deter and prevent violations regarding goods origin fraud and illegal transport in import and export;
- Promote international cooperation in deterring and taking actions against goods origin fraud and illegal transport in import and export.
II. PRIMARY TASKS AND MEASURES
1. Ministry of Industry and Trade
a) Take charge and cooperate with ministries and relevant agencies in examining and developing legislative document systems
- Amend or replace Decree No. 124/2015/ND-CP dated November 19, 2015 on amendments to Decree No. 185/2013/ND-CP on administrative sanctions in trade, manufacture and sale of counterfeits and banned commodities, and protection of consumer’s rights by increasing levels of sanctions imposed on violations relating to origin fraud and fabricated product labeling to intensify intimidation;
- Examine legislative documents on goods origin, foreign investment and auxiliary industry and amend regulations to conform to policies of government on prevention and combat against trade frauds regarding origin;
- Expedite completion of relevant law provisions on goods origin, particularly domestically circulated goods.
b) Continue to take charge and cooperate with relevant ministries to fully implement Decision No. 824/QD-TTg dated July 4, 2019 of Prime Minister approving Schemes for enhancement of state management regarding combat against evasion of trade remedies and origin fraud measures. Monitor, conduct statistical reports and update on a regular basis, promptly provide list of commodities placed under inspection, adoption of antidumping tax and countervailing tax by countries adopting trade remedies on a regular basis and list of commodities subject to origin fraud and illegal transport for Ministry of Finance and relevant ministries and organizations, People’s Committees of provinces or central-affiliated cities to enhance control, examination and inspection, particularly control, examination and inspection of issuance of C/O and supervision of investment, manufacture, import and export.
c) Facilitate implementation of incentive policies on development and investment attraction in supporting industries to increase import substitution rates in product composition in order to satisfy domestic value contents and regional value contents to raise use rates of preferential C/O, take advantage of tax reduction of the FTAs, reduce probability of being investigated for combat against origin fraud and trade remedy evasion by other countries.
d) Adopt routes suitable to self-certification of product origin and certificate of origin via the internet to facilitate exporting enterprises and suitable to law systems and practical situations in Vietnam.
dd) Ministry of Industry and Trade and Ministry of Finance shall consider and sign records for cooperation on information exchange serving enhancement of origin control and warning, assessment of probability in which export goods are subject to trade remedies and counter evasion as well as investigation for adoption of trade remedies and counter evasion measures on export goods.
e) Promote international cooperation, particularly via signing memorandum and reach agreements on cooperation with relevant agencies of foreign countries to increase effectiveness of actions against evasion of trade remedies and origin fraud.
g) Strengthen organization and increase capacity with respect to issuance of C/O, including reform systems of C/O issuing bodies and examination and verification of goods origin in order to ensure operational effectiveness of the systems in a modern and efficient fashion.
h) Intensify inspection and supervision frequencies carried out on C/O issuing bodies according to applicable regulations and law in order to ensure compliance with regulations and law on goods origin.
- On a regular basis, carry out inspection and supervision on bodies issuing C/O (both preferential and non-preferential C/O) to ensure stringent compliance with regulations and law on goods origin;
- Increase cooperation between C/O issuing bodies in information exchange; improve specialized and operational instructions provided for officials issuing C/O, upgrade facilities and store documents and files, etc. in order to facilitate verification of origin upon request;
- Monitor and update information and data on issuance of C/O on a regular basis to detect irregularities;
- Continue to implement on a large scale classification mechanic in application receipt and issuance of C/O, update lists of enterprises and commodities under high risks on a regular basis to place into red lane. Identify focus of export goods displaying unusually high turn-over to request origin inspection and verification;
- Increase risk management, document examination and verification at enterprises with respect to suspicions or goods under high risks;
- Increase supervision and monitor with respect to enterprises self-certifying origin of their products to avoid exploitation to commit violations regarding goods origin fraud;
- Establish interdisciplinary inspectorates to inspect origin of goods of enterprises suspected with origins and labeling fraud and illegal transport of goods; the inspectorates consist of Ministry of Industry and Trade, Ministry of Finance, Ministry of Public Security Vietnam Chamber of Commerce and Industry and relevant industry associations. Conduct inspection on issuance of certificate of origin of goods;
- With respect to contents relating to examination and verification of export goods origin before and after issuance of certificate of origin of goods and self-certification of origin of export goods of traders, comply precisely with Circular No. 39/2018/TT-BCT dated October 30, 2018 on examination and verification of goods origin.
i) Develop and request Prime Minister to approve scheme for effective development and operation of early warning systems against trade remedy proceedings in December 2019 to establish basis for analysis and update risks of goods being inspected by other countries in terms of trade remedies and origin fraud as well as prevent import goods sold at injured prices, subsidized goods or goods with fabricated origin from being imported into Vietnam which will damage domestic manufacture.
- Develop close and effective cooperation between ministries, Vietnam Chamber of Commerce and Industry and industry associations to innovate and assist enterprises in dealing with issues on a regular basis, facilitate enterprises in stringently complying with regulations and law on goods origin. Provide information on productivity and manufacture capacity of industry associations and suspicions regarding C/O fraud, information about C/O fraud schemes to enable competent authorities to emphasize on management;
- Cooperate with ministries, local government, industry associations and relevant organizations in promoting training, education and raising awareness of counter of origin fraud and illegal transport.
l) Establish hotline to receive information relating to origin fraud.
m) Stringently cooperate with ministries, People’s Committees of provinces and central-affiliated cities and C/O issuing bodies to monitor and conduct physical inspections on manufacturing process of enterprises manufacturing export goods, acknowledge manufacturing operation and material sources used by the enterprises to ensure satisfactory to origin criteria.
2. Ministry of Finance
a) Cooperate with ministries in amending regulations relating to imposing sanctions regarding to origin of import and export goods in Decree No. 45/2016/ND-CP dated May 26, 2016 on amendments to Decree No. 127/2013/ND-CP dated October 15, 2013 of Government on administrative sanctions and enforcement of implementation of administrative decisions in customs.
b) Direct General Department of Customs to:
- Monitor import and export figures, particularly those of goods under the lists and goods of Vietnam placed under inspection and trade remedies to provide information for Ministry of Industry and Trade and Ministry of Public Security on a monthly basis, pay special attention to unusual change in import and/or export turn-over;
- Increase inspection, control and taking actions against manufacturing and trading goods infringing intellectual property rights within customs controlled areas;
- Increase customs cooperation with other countries to exchange information relating to statistical figures of import and export goods of Vietnam, predict probability that export goods of Vietnam are placed under trade remedies and other measures of customs authorities of importing countries relating to origin fraud and illegal transport;
- Increase monitor, examination and origin verification, promote management with respect to certain import and export goods observing unusually rise in turn-over, goods placed under taxes for prevention of trade remedy evasion, potentially subject to origin and/or labeling fraud or falsification and illegally transported. Provide investigation, verification and examination results with respect to goods and enterprises committing origin-related violations and information relating to fraudulent schemes during procedures for issuance of C/O and origin fraud of import and/or export goods for Ministry of Industry and Trade, Ministry of Public Security and Vietnam Chamber of Commerce and Industry to warn procedures for issuance of C/O for export goods of Vietnam;
- Develop origin fraud warning functions on the management systems of customs authorities to promptly intercept shipments suspected with origin fraud;
- Perform stricter origin inspection from application receipt to post clearance inspection. Develop operational network to examine and verify origin of import and export goods.
3. Ministry of Science and Technology
a) Increase inspection on labeling of goods circulated in domestic market to promptly detect violations relating to product labeling.
b) Cooperate with relevant ministries in conducting research and amending Decree No. 43/2017/ND-CP on goods labeling and Decree No. 119/2017/ND-CP dated November 1, 2017 of Government on administrative sanctions in product and goods standards, measurement and quality to promptly prevent Vietnam labeling and origin fraud.
c) Examine scope and effective period of Circular No. 05/2019/TT-BKHCN on guidelines for implementation of Decree No. 43/2017/ND-CP dated April 14, 2017 of Government relating product labeling.
4. Vietnam Chamber of Commerce and Industry (VCCI)
a) Increase examination and verification regarding origin of goods and goods exported from Vietnam to other countries for issuance of certificates of origin as per the law.
b) Perform stricter management of issuance of certificates of origin as specified in Decree No. 31/2018/ND-CP dated March 8, 2018 on elaborating to Law on Foreign Trade Management regarding goods origin.
c) Monitor market and supervise manufacture and export of member enterprises to promptly detect violations regarding goods origin fraud, cooperate in providing relevant ministries (Ministry of Industry and Trade, Ministry of Finance, etc.) information about goods and enterprises potentially commit origin fraud and illegally transport.
d) Exchange information about issuance of C/O with Ministry of Industry and Trade as per the law. Develop measures to link systems for exchange of C/O issuance information via National single-window portal according to data standards provided by Ministry of Industry and Trade.
dd) Stringently cooperate with ministries, People’s Committees of provinces and central-affiliated cities and C/O issuing bodies to monitor and conduct physical inspections on manufacturing process of enterprises manufacturing export goods, acknowledge manufacturing operation and material sources used by the enterprises to ensure satisfactory to origin criteria.
e) Increase publicizing, raising awareness and warning enterprise and industry associations about risks of sanctions against origin fraud; encourage associations to detect and report origin fraud violations; protect honest enterprises and Vietnam brands.
5. Ministry of Public Security
a) Proactively adopt measures to acknowledge research and assess commercial policies, trade remedies and trade protection of other countries, particularly those of the United States, EU, China, etc.; conduct research and review difficulties in policies, regulations and law under functions and tasks of Ministry of Public Security relating to import and export of goods, prevention of trade remedies and origin fraud evasion to promptly request Government and ministries to amend and develop in a joint and synchronized fashion and satisfactory to requirements of state management, international integration and prevention and fight against crimes in recent times.
b) Closely cooperate with Ministry of Industry and Trade, Ministry of Finance and VCCI to increase prevention of tax evasion, promptly examine and verify goods and cases of potential origin fraud; proactively detect, investigate and take actions against violations regarding trade remedy evasion and origin fraud as per the law.
c) Direct professional agencies and police of local governments to increase supervision to promptly detect violations regarding origin fraud, investigate and take actions against violations as per the law, increase supervision with respect to foreign direct and indirect investment in each relevant sector and administrative division.
6. Ministry of Planning and Investment, Ministry of Transport, Ministry of Agriculture and Rural Development and Ministry of Construction
a) Increase publicizing and instruct local authorities to consider and deal with investment registration of foreign investors (including acquisition and purchase), monitor closely foreign investment projects in sectors and foreign investment projects manufacturing and/or trading goods potentially subject to origin fraud, illegal transport and trade remedy evasion.
b) Cooperate in conducting research and analyzing assessment of domestic manufacturing capacity with import and export figures provided by Ministry of Finance and provide information on investment of enterprises relating to goods potentially subject to origin fraud for Ministry of Industry and Trade, VCCI and General Department of Customs to perform strict control during issuance and examination of export goods origin.
c) Consult industry associations to devise measures to be adopted within specific sectors to prevent origin fraud and protect domestic manufacture.
7. People’s Committees of provinces or central-affiliated cities shall direct
a) Local departments and agencies
- To enhance examination, control, prevention, detection and actions against origin and labeling fraud, and illegal transport of goods;
- To increase publicizing and popularizing legislative documents on goods origin and labeling to enable enterprises operating in vicinity to acknowledge policies, regulations and law of government and comply therewith.
b) National steering committees for combating smuggling, commercial fraud and counterfeit goods of provinces and cities.
- To develop plans for combating and preventing origin and labeling fraud and illegal transport of goods from time to time;
- To monitor, encourage and report on combating and preventing smuggling, origin and labeling fraud and illegal transport of goods according to direction of the National steering Committee 389.
8. Media and press agencies
Vietnam Television (VTV), Voice of Vietnam, Vietnam News Agency, etc. and press agencies shall increase publicizing and providing information about combating origin fraud, illegal transport, trade remedies and prevention of trade remedy evasion of Vietnam.
III. ASSURANCE OF IMPLEMENTATION RESOURCES
1. Ministries, ministerial agencies, People’s Committees of provinces or central-affiliated cities and relevant agencies and organizations shall assure personnel and necessary conditions for timely and effective implementation of tasks and measures set forth under this Resolution.
2. Ministry of Finance shall provide funding for implementation of tasks set forth under this Resolution.
1. Ministries, ministerial agencies, Chairpersons of People’s Committees of provinces and central-affiliated cities and heads of relevant agencies within their functions and tasks shall be assigned to direct, instruct and organize implementation of measures under this Resolution to enhance state management regarding prevention and combat against goods origin fraud and illegal transport.
2. Ministry of Industry and Trade shall take charge and cooperate with ministries and People’s Committees of provinces or central-affiliated cities in monitoring, encouraging and examining implementation and results of implementation of the Resolution; consolidate and report to Prime Minister on implementation of ministries and local governments upon request./.
(Signed and sealed)
Nguyen Xuan Phuc
(This translation is for reference only)