Closing Loopholes in Faking Vietnam Origin on Electric Vehicles

Featuring convenience and affordability, electric vehicles (EV) are becoming a preferred means of transport for many consumers. However, there is a dire need for strictly controlling the origin to ensure customer interests.

In recent years, EV sales grew more than 30% a year. Customers can easily buy an EV model from e-commerce websites and shops in Ton Duc Thang and Ba Trieu streets (Hanoi). Most EV models are introduced as “assembled in Vietnam”, commonly sold at VND6-12 million each for electric bicycles and VND14-20 million for electric motorcycles. Many such brands as VinFast, Yadea and Pega are often more expensive, ranging from VND20 million to VND50 million. Small EVs are more preferred. And, most consumers find it hard to distinguish Vietnamese or imported goods.

According to authorities, over one million EVs are sold each year but only 290,000 units are manufactured and assembled in Vietnam, while the rest are imported with unguaranteed quality.

According to an electric bike manufacturer in Vietnam, up to 90% of electric bicycles and components on the market have unclear origin. All kinds of EV components were smuggled into Vietnam. EVs lack certified stamps and certificates of origin. Most of them are of low quality, lacking quality-guaranteed components.

Furthermore, in rural areas, cheap EVs, priced around VND10 million each, are preferred. This segment has most products of unclear origin and unguaranteed quality. In fact, millions of EVs sold each year are not registered, thus increasing incomes for manufacturers and distributors. Besides, the EV market is overwhelmed by contraband and counterfeit products.

In addition, according to current regulations, electric bikes are not necessarily registered for circulation (license plates) like electric motorcycles. Thus, owners do not have to care about stamps and invoice value or other documents about EVs. As a result, a lot of knock-offs are present on the market but market watchdogs cannot deal with them because related regulations are absent.

Mr. Nguyen Tien Loc, Director of Post-Customs Clearance Inspection Bureau under the General Department of Customs, said, customs authorities specified behaviors, tricks and schemes of violators. For example, as for electric bikes, companies import separate components for assembly in Vietnam to make complete products. Imported components are not made in Vietnam or just simply processed (like painting frames and handlebars) and should not be certified Vietnam origin. According to inspection results, most checked EV vehicle manufacturers are found to have origins defrauded.

To combat the counterfeiting of Vietnam origin of exported goods, the General Department of Customs requested the Ministry of Industry and Trade to provide information on enterprises and commodities suspected of defrauded origin and labeling and illegal information. The General Department regularly directed and warned C/O issuers of enhancing inspection and supervision of C/O granting, reminding them to pay heed to items with high risk of origin fraud (such as solar cell, car tire, pistachios, shrimp, aluminum, steel, plywood, ceramic tile and electric bicycle.) It also asked for completing legal documents on origin and labeling of exports; reviewing, amending and supplementing simple processing stages specified in Article 9 of Decree 31/2018/ND-CP to match current developments. C/O authorities need to assess risks, assign inspectors to examine suspected production facilities before granting C/O. It trained and guided origin and traceability of commodities for enterprises and recommended them to provide information for authorities when they see any abnormal signs to avoid being affected by bad deeds.

 By Le Hien, Vietnam Business Forum