Business community dubious over draft changes

Consecutive changes in requirements for goods labels are making it difficult for businesses to perform, Photo: Le Toan

The purpose of the amendment of Decree No.43/2017/ND-CP dated 2017 on good labels is to combat trade fraud to suit the new situation, as well as to remove difficulties for businesses according to the Ministry of Science and Technology.

However, complaints have emerged over some burdens it may make on business, with unnecessary red tape that forces exporters to attain confirmation of foreign codes and barcodes.

The new draft, expected to come into effect in June 2021, requires that the name of the trader in charge of the goods (usually the importer) must be written on the original label for customs clearance at the border.

This means that all products imported from abroad to Vietnam or exported from Vietnam must clearly state the names of the importing units. But some enterprises have stated that this is an unreasonable and unnecessary requirement as goods from manufacturers can export to many countries, so they cannot meet specific requirements for Vietnam.

The American Chamber of Commerce in Vietnam (AmCham) also said that multinational enterprises produce in many places and sell goods around the world with the same main label. With this provision, exporters will have to design private labels for Vietnam which is expensive and unfeasible.

On two occasions since 2017, changes have been made regarding legislation on labelling, and next summer’s expected update will be the third. Firms say this is far too frequent, costing businesses hefty sums just to replace labels.

“Enterprises want a stable business environment. Changing too much makes businesses extremely tired and produces large costs due to changing labels too often,” said a representative of AmCham Vietnam at a recent conference.

Nguyen Hoai Nam, deputy general secretary of the Vietnam Association of Seafood Exporters and Producers explained that the provision is also contrary to international best practices which state that exporting organisations and individuals are only responsible for supplying goods strictly according to the contract in each case.

The importer is also the owner of the goods and is responsible for ensuring that labelling of exported goods does not violate laws of the importing country.

Decree 43 also set organisations’ foreign codes compliant with barcode standards, and shall assume responsibilities including ensuring codes or barcodes are competently issued and used according to a foreign code owner’s authorisation.

If authorised by an owner of a foreign code, the organisation using such codes must inform the competent regulatory authority to get confirmation of use of the codes according to the decree.

As per the Ministry of Science and Technology, using labels and barcodes helps manufacturers and suppliers avoid commercial fraud and protect consumer rights. They will help promote trade and international integration by facilitating businesses in e-commerce and product traceability.

“Regarding the policy, we agree with businesses that the amendments should contribute to progress and support them in areas such as electronic labelling, so it should be fixed soon and there must be a schedule for implementation,” he said.