Supporting Export Processors to Overcome Hardships

2:26:30 PM | 8/10/2020

To assist businesses in general and export processors to overcome difficulties, in addition to issuing investment support policies on infrastructure construction, Vinh Phuc province has actively organized many direct dialogues with investors and businesses. At the same time, the province requested the Ministry of Finance and the Ministry of Planning and Investment to seek advice on solving difficulties faced by export processing companies.

Currently, Vinh Phuc has nearly 400 FDI companies with over US$5 billion of registered investment capital, including 300 in industrial parks, of which 25% are export processing enterprises.

Under the Government's Decree 82/2018 / ND-CP on management of industrial and economic zones, newly established export processing enterprises may have the waiting time for investment certification extended because the licensing must meet criteria imposed by customs authorities as per Clause 1, Article 30 of Decree 82 which states “Export processing zones and export processing enterprises may be applied separate regulations on customs and non-tariff zones, except for separate regulations applicable to non-tariff zones inside a border economic zone. The export processing enterprise is specified in the Investment Registration Certificate or in a relevant document granted by a competent investment registration agency in case it is not required to carry out procedures for an investment registration certificate. The investment registration agency is responsible for consulting competent customs authorities on the capacity to satisfy conditions for customs inspection and supervision before issuing an Investment Registration Certificate or a certification document to the investor.”

Accordingly, as for projects applying for an investment certificate as an export processing enterprise, the provincial investment registration agency consults customs authorities of Vinh Phuc province before granting a license. The consultation process encountered problems, mainly relating to tax-free business conditions, inspection and supervision, and competence criteria, making it hard for the investment registration agency to license an export processing enterprise as per the 2014 Investment Law and its guiding documents.

To remove difficulties for export processors, on April 20, 2020, the Vinh Phuc Provincial People’s Committee sent a document to the Prime Minister asking for assistance and direction to remove difficulties in executing the Government’s Decree 82 on export processing enterprises. On June 9, 2020, the General Department of Vietnam Customs issued Official Dispatch 3778 on conditions for customs inspection and supervision when establishing an export processing enterprise.

Accordingly, upon receipt of a written consultation from the investment registration agency as prescribed in Clause 1, Article 30 of Decree 82, customs authorities check contents for competence certification. Certification conditions include separated surrounding hard walls, surveillance camera system, surveillance camera image storage, camera image data storage for at least 12 months, the camera system directly connected to customs offices, and input management system among other things.

If investors and enterprises already have factories or rent factories that meet criteria for gates, doors and surveillance camera systems, they may be considered for being granted the Export Processing Enterprise Registration Certificate. Companies are licensed for export processing but still subject to usual business conditions, they must submit relevant documents to the Vinh Phuc Industrial Parks Authority and the Vinh Phuc Customs Department for inspection and supervision. If qualified, they will be entitled to preferential treatment applied to export processing enterprises. They must seriously comply with four conditions in the Official Dispatch 3778 of the General Department of Customs to avoid arising problems.

By Nguyet Tham, Vietnam Business Forum