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Need for legal mechanism to deploy customs bond

14:29 | 26/05/2020

VCN – To deploy customs bond for import – export goods, there is a need for a legal mechanism

need for legal mechanism to deploy customs bond
Import - export activities at Da Nang port. Photo: N.Linh

In a report submitted to the Government to approve the scheme of “customs bond mechanism for import – export goods”, the Ministry of Finance made some recommendations on amending and improving Vietnam’s legal system to facilitate import enterprises and enhance administrative ability of Customs authorities as well as management authorities when applying customs bond mechanisms.

To have a legal basis for deploying customs bond in Vietnam, the Ministry of Finance proposed to submit National Assembly to consider promulgating a resolution of piloting customs bond for import – export goods and transit; the Government issued decree on instructing the implementation of the resolution of the Government on customs bond.

Regarding detailed content, the Ministry of Finance proposed that, in the first stage of piloting, they would select some form of business for applying a customs bond mechanism on the basis of inheriting form of guarantee already applied and applying pilot for some new forms. At the same time, expanding range for subjects participating in customs bond, including:

Import - export goods must pay full tax before clearance or releasing goods.

Goods are temporarily imported and re-exported within a limited time allowing for preservation in Vietnam in accordance with Foreign Trade Management (including the time of extension), expecting goods are on the list of goods banned from import – export, suspension from import – export but allowing to temporary import and re-export.

Goods in transit in Vietnam’s territory, excepting goods in the list of goods banned from import – export, suspension from import – export.

Imported goods subject to case of allowing to late submission of certificate of origin (C/O) in accordance with regulations; imported goods which are waiting for inspection result from the competent authority or organisation granting C/O of export country.

Imported goods are on the list of potentially unsafe commodities complied with the law on product and goods quality and subjected to the case of submitting results of State inspection on quality before clearance.

According to the Ministry of Finance, the deployment of customs bond will provide a control mechanism which allows to cut clearance time and enhance compliance. Deploying customs bond will strengthen tax collection, preventing situation of trade fraud and customs law violations.

Facilitating cargo clearance, releasing imported goods subjected to specialised inspection and ensuring conditions on customs supervision and management of goods.

This mechanism brings many benefits for parties directly involved and it will contribute to cost savings, increase working capital for businesses, fast cargo clearance; ensure customs law compliance for customs authorities; expanding market of the insurance service.

Specific benefits assessed by experts of Global Alliance of Trade Facilitation, customs bond mechanism would help cut administrative costs for businesses, State management authorities, help reduce costs equal to 0.1-0.5% of the value of the shipment; reducing clearance time to reduce costs for businesses (the part of cost reduction was equaled to 0.5-0.8% of the value of the shipment); this mechanism also helped increase competition, promote export growth (up 1% of total export turnover). In particular, the customs bond did not reduce or eliminate requirements of implementing specialised management and inspection regulations for import and export goods.

By N.Linh/Thanh Thuy