Getting accustomed to change

The Ministry of Finance just enacted Circular 105/2011/TT-BTC dated July 12, 2011 to amend some conditions regulated in Circular 63/2011/TT-BTC dated May 13, 2011 stipulating pilot application of priority regime in state management on customs for enterprises.

In light of the new circular, firms will benefit from ‘eased’ conditions to become qualified for a customs priority regime. For example, minimal annual export values were lowered to $70 million (for export of agricultural, forest and seafood products of Vietnamese origin) and $350 million (for export of general products) from the previous $100 million and $500 million, respectively.

Besides, the new circular regulated only administration violations incurring fines of over VND20 million ($960) each time would be considered as faults by customs bodies when appraising priority enterprise application records.

“The amendment will bring opportunities for more firms to honour the priority scheme by customs bodies, particularly small-and medium-sized businesses,” said General Department of Customs (GDC)’s Post-clearance Audit Department head Pham Thanh Binh.

The priority enterprise programme triggered public great attention right after it was announced by the GDC as the programme gave huge and practical advantages to ‘priority’ enterprises such as reductions of customs procedures, quick customs clearance, reducing charges and increasing business efficiency.

However, the conditions for priority enterprise recognition are high, according to many firms. For instance, one of the criteria priority enterprises must satisfy is their administrative violations must not exceed three times in the last three years.

“Businesses may unintentionally incur faults with diverse fine levels due to meticulous customs regulations. Not many enterprises are, therefore, up to scratch when it comes to administrative violation criterion,” Binh said.

General director Le Duc Thong at 2/9 Daklak Import Export Company Limited, one of nine priority customs sector enterprises, said he expected the new status would help the firm significantly shorten the time working with customs bodies since currently around 10 per cent of its export shipments incur direct customs checks.

Among the priority enterprises, are Japan-backed Sumidenso and Brother Vietnam and South-Korea’s Samsung Electronics Vietnam.

Sumidenso Vietnam general director Ofuchi Ryuhei said the recognition helped the firm pare down huge administrative work volumes and quickly come through customs checks. “With the facilitation, we are committed to expand our footprint in Vietnam,” he said.

“We are happy with the [priority enterprise] recognition as it facilitates enterprise business and demonstrates the Vietnamese government’s recognition of Samsung efforts,” said Samsung Electronics Vietnam general director Yoo Young Bok.

Firms expect the GDC will soon hold negotiations and ink agreements on mutual recognition of priority enterprises with the customs authorities in other countries to effectively support businesses’ import and export activities.

Recently honoured nine priority enterprises:

1.     Binh Son, Quang Ngai Petrochemicals Limited Company

2.    Southern Food Corporation

3.     Minh Phu-Ca Mau Seafood Corporation

4.     Samsung Vina Electronics Co., Ltd.

5.     2/9 Daklak import-export one remember Co., Ltd

6.     Brother Industries Vietnam Co., Ltd

7.     An Giang Seafood Import-Export Joint Stock Company)

8.     PV Oil Corporation

9.     Sumidenso Vietnam Co., Ltd