Entrepot Trade Management Tightened

To prevent fraudulence and tax evasion on goods temporarily imported for re-export, goods in transit, goods transshipped across border gates and goods stored in bonded warehouses, the General Department of Vietnam Customs (GDC) required provincial customs authorities to tighten inspection and supervision of transportation and export of these types of goods.

GDC requests customs authorities to reinforce inspection, control and supervision of goods in transit, goods temporarily imported for re-export and consigned goods in bonded warehouses

GDC recently sent Official Letter 1236/TCHQ-GSQL to customs authorities of provinces and cities, demanding them to reinforce inspection, control and supervision of goods in transit, goods temporarily imported for re-export and consigned goods in bonded warehouses.

Splitting shipments to export through the trail

The guidance came as border provinces witnessed many traders taking advantage of goods temporarily imported for re-export, but they did not re-export them and smuggled them into Vietnam.

When transporting goods in transit, traders extract them for selling in Vietnam. “Surveys and inspections showed that inconsistent and inappropriate implementation at some customs units led to the risk of smuggling, trade fraud and tax evasion,” said GDC in the above document.

Apart from taking goods out of transit containers, as for conditional imports, valuable imports or banned imports in transit shipments, traders will seek to bring them back to Vietnam by various methods.

Therefore, to ensure the export and re-export of goods by law, GDC required customs authorities of provinces and cities to inform their customs officers at border-gate customs offices to intensify inspection, supervision and control of goods temporarily imported for re-export, goods in transit, goods transshipped through border gates and goods stored in bonded warehouses for export through land border gate in Documents 3734/TCHQ-GSQL dated June 8, 2020; 3475/TCHQ-GSQL dated July 9, 2021; 4182/TCHQ- GSQL dated August 26, 2021; 1036/TCHQ-GSQL dated March 28, 2022 and 3361/TCHQ-GSQL dated August 12, 2022.

In addition, they are told to strictly implement customs management, inspection and supervision of goods in transit in accordance with agreements on goods in transit signed between Vietnam with Cambodia, Laos and China.

Regarding export border gates for goods temporarily imported for re-export, goods in transit and goods stored in bonded warehouses, GDC required goods re-exported and goods transported from bonded warehouses to border gates for export to foreign countries across border gates must be re-exported through international border gates or main border gates in accordance with the laws.

Goods are only allowed to be exported and re-exported to right places of exportation and border gates of exportation registered on customs declaration forms. They are not allowed to be subdivided from containers or shipments to export through trails, openings and border landmarks,” GDC emphasized.

GDC also noted that customs officers only confirm goods that pass monitoring areas after the entire shipment has been transported to right border gates of exportation registered with customs authorities.

Close monitoring with electronically positioned seals

Re-exported and exported goods are required to be transported on vehicles that meet conditions for customs sealing, inspection and supervision.

Accordingly, containers are not torn or punctured; locks and latches are sealed by customs authorities; hinges and ears of containers conform to standards certified by competent authorities as prescribed in Circular 64/2015/TT-BGTVT dated November 5, 2015 of the Ministry of Transport.

Cargo containers are not torn or punctured; locks and latches are sealed by customs authorities.

The transportation of goods in transit, goods from bonded warehouses or from storage places, and goods temporarily imported for re-export to the border gate of export is required to be monitored with electronically positioned seals.

If containers or customs seals are changed from original conditions, vehicles do not follow registered routes and time, or turn off positioning signals, inspection on them is required at border gates of export.

Customs authorities of provinces and cities that have been granted electronically positioned seals review and direct their affiliates and subordinates to strictly and effectively use electronically positioned seals as guided by GDC in Official Letter 5227/TCHQ-GSQL dated June 7, 2020 and Official Letter 7885/TCHQ-GSQL dated December 14, 2020 on increased use of electronically positioned seals and rectification of civil servants who do not install positioned seals.

GDC requested customs departments of provinces and cities, especially those with land border gates, to direct border-gate customs offices, customs control forces and internal inspectors to control administrative procedure implementation and customs supervision along protrusions and openings to promptly detect, correct and handle unlawful acts of export and re-export across border gates.

GDC also proposed the Anti-smuggling and Investigation Department, the Customs Control and Supervision Department and the GDC’s Standing Committee strengthen measures to inspect, supervise, observe and control directly or through electronically positioned seals and surveillance cameras installed at border gate areas.

“In case violations are detected, in addition to treatment by law, it is necessary to clarify signs of aiding and protecting goods transported through these areas by customs officers as well as other forces. GDC will review responsibility and handle agency leaders when violations are found in their areas,” GDC emphasized.

With electronically positioned seals, customs authorities have a fully active and automatic monitoring tool that uses GPS positioning technology to support professional staff in tracking and monitoring container/vehicle locations and ensure the integrity of goods during transportation.

The system will warn users in case the vehicle goes the wrong way, intervention is detected, seals are illegally impacted or the vehicle travels and stops longer than the given time.

Source:  Vietnam Business Forum