70th anniversary of Hanoi's Liberation Day Vietnam - Asia 2023 Smart City Summit Hanoi celebrates 15 years of administrative boundary adjustment 12th Vietnam-France decentrialized cooperation conference 31st Sea Games - Vietnam 2021 Covid-19 Pandemic
Home / Economy / Trade - Service
Vietnam urged to step up fight against origin frauds
Ngoc Mai - Le Nam 17:26, 2020/09/15
Foreign companies are abusing preferential treatments from free trade agreements (FTAs) between Vietnam and its partners for illegal transshipment.

Amid a growing number of Chinese goods forging Vietnamese origin to evade US punitive taxes when being exported to the US, Vietnam could face sanctions from the later without drastic measures to address the issue, according to experts.

 Hanoi's Market Surveillance Authority checked origin of products at HC super market. Photo: Le Nam.  

Last week, the General Department of Vietnam Customs (GDVC) identified a local company that imported Chinese silk but then changed the origin as Vietnamese products to export to India. By being labeled as of Vietnamese origin, those products would only be subject to an import tariff of 5%, instead of 25% as Chinese products.

Head of USAID Trade Facilitation Program Claudio Dordi said the issue is not new as the agency has found many Chinese products, ranging of bicycles, footwear, lighters, among others with counterfeit origin as Vietnamese goods to export to the US or the EU since 2000.

A report from the Vietnamese customs authority revealed it has caught 76 cases of origin frauds since 2019 to date, in which the majority were Chinese goods that underwent basic assembling process in Vietnam. After having acquired the certificate of Vietnamese origin, they are later exported to other countries such as the US, EU or Japan, among others.

Director of GDVC’s Customs Control and Supervision Department Au Anh Tuan said foreign companies are abusing preferential treatments from free trade agreements (FTAs) between Vietnam and its partners for illegal transshipment.

Recently, as the US has raised import tariffs to Chinese goods and products by an additional 7.5 – 285%, more and more goods have forged Vietnamese origin to evade US tariffs, Tuan added.

Lack of proper measures

Facing risks from foreign goods using Vietnamese origin for unfair trade gains, Prime Minister Nguyen Xuan Phuc on July 4, 2019 issued Decision No.824 aiming to improve state management to prevent evasion of trade remedies and origin fraud.

However, many experts raised concern that Vietnam’s legal framework has not had proper regulations and laws to address this issue.

Vu Tien Loc, chairman of the Vietnam Chamber of Commerce and Industry (VCCI), said the current Penal Code does not include punishments against the act of forging origin, while the concept of “illegal transshipment” has not been mentioned in any law.

Sharing the same view, Head of Hanoi’s Department of Market Surveillance Chu Xuan Kien said the law does not provide a detail clarification of “basic assembling works”, making it difficult for local authorities to identify whether a local firm is actually just assembling products for its foreign partners.

Loc from VCCI suggested local authorities should not tighten rules related to the issuance of certificate of origin, especially products having two thirds of production process outside Vietnam.

RELATED NEWS
TAG: Vietnam origin frauds trade tension United States China USAID illegal transshipment VCCI Customs authorities
Other news
15:25, 2024/03/29
Vietnam among Japan’s top partners: KEIDANREN
Japanese firms are eager to expand in Vietnam and boost economic cooperation in various fields, including industrial support, digital transformation, high-quality workforce training, and global supply chain development.
20:36, 2024/03/25
Vietnam seeks to strengthen ties with Finland
Vietnam remains a key partner for Finland in ASEAN.
18:15, 2024/03/21
Vietnam urged to soon implement PDP VIII
Ensuring an attractive investment environment "capable of mobilizing capital" is crucial to attracting long-term investment in infrastructure development.
15:41, 2024/03/21
Argentina seeks to elevate ties with Vietnam to strategic partnership
Both sides would continue to accelerate the process of negotiating and concluding the Vietnam-MERCOSUR Free Trade Agreement.
20:36, 2024/03/20
Vietnamese Gov’t to strengthen gold market management
Authorities must strictly enforce laws against gold smuggling, speculation, manipulation, and exploiting government policies to inflate gold prices, posing risks to market stability and safety.
15:06, 2024/03/20
South Korea to increase ODA by 50% to Vietnam in 2024
South Korea is the leading investor in Vietnam with a cumulative total of $86 billion.