Vietnam endeavors to combat trade fraud

The government of Vietnam’s effort to combat trade fraud has been highly appreciated by trade partners as Vietnam’s exports to important markets continue to be welcomed.

Serious violations committed by Excel Co Ltd, a 100 percent Chinese invested enterprise, which makes bicycles for export, have been discovered.

Vietnam endeavors to combat trade fraud

Serious violations have been discovered

The officials of the Post-customs Clearance Inspection Agency at the General Department of Customs (GDC) found that the company imported 100 percent of bicycle and electric bicycle parts from China and assembled them in Vietnam for export.

The components imported to Vietnam had not undergone any manufacturing process before they were exported from Vietnam to the US, and were labeled as Vietnamese products in order to enjoy preferential tariffs.

Reports on Chinese investments in Vietnam show a sharp increase recently. According to the Ministry of Planning and Investment (MPI), investments from China and Hong Kong are increasing rapidly as a result of the US-China trade war.

After referring to the current regulations on goods origin, the agency concluded that the products of the company, established in 2018, did not meet the requirements to be considered products with Vietnamese origin.

“The company acknowledged the violations,” the representative of the agency said, adding that all the products in violation have been seized.

Excel Co Ltd is not alone. The agency also discovered fraud committed by three other bicycle and one woodwork assembling companies in order to enjoy Vietnamese origin.

It named a series of 100 percent Chinese invested enterprises in the watchlist for origin fraud, inspected ninr enterprises and directed nine provincial and municipal customs agencies to inspect another 24 enterprises.

The discoveries by GDC show that origin fraud has become a significant problem in the context of the escalating trade war. They also show Vietnam’s strong determination to ensure a level playing field for businesses.

Reports on Chinese investments in Vietnam show a sharp increase recently. According to the Ministry of Planning and Investment (MPI), investments from China and Hong Kong are increasing rapidly as a result of the US-China trade war.

 

The investments from China have increased by 1.65 times, and from Hong Kong 2.4 times compared with 2018. China (including Hong Kong) has jumped to the first or second position among the 125 countries and territories having foreign direct investment (FDI) in Vietnam, which had never occurred before.

In 2016, capital from China, not including Taiwan, to Vietnam was $3.51 billion only. It surged to $3.64 billion in 2017, $5.64 billion in 2018 and continued increasing sharply in 2019.

Not all foreign investors follow illegal purposes when making investment in Vietnam. However, the host country always has to be vigilant in the current complex geopolitical context.

Nguyen Tien Loc, director of the Post-customs Clearance Inspection Agency, said the agency is focusing on Chinese invested enterprises because of the high risk for origin fraud. In the US-China trade war, many Chinese enterprises are flocking to Vietnam under the cloak of investors to export their products to the US to evade tax.

Warning of the abnormality of the foreign capital flow to Vietnam, the Ministry of Planning and Investment (MPI) has sent a document to provincial people’s committees, asking local authorities to provide information and urge relevant agencies to monitor foreign investment changes (new investment, M&As and foreign ownership ratio) in production and business fields related to products prone to trade remedy and tax evasion avoidance measures.

This aims to minimize the cases of Vietnamese goods being investigated for trade remedy avoidance, especially origin fraud through investment in Vietnam; and to prevent foreign enterprises from exploiting Vietnam as a transshipment point to export goods to third countries.

The warnings by Vietnamese agencies, including GDC, the Ministry of Industry and Trade, and MPI, are very necessary to prevent Vietnam from not getting involved in the trade war.

In early July 2019, Prime Minister Nguyen Xuan Phuc approved a plan on strengthening state management of avoidance of trade remedies and origin fraud. A lack of vigilance would force Vietnam’s economy to pay a heavy price. 

Luong Bang

Vietnam eyes sustained fight against trade fraud, cross-border smuggling

Vietnam eyes sustained fight against trade fraud, cross-border smuggling

Drastic measures are needed to sustain the fight against trade fraud and smuggling of goods into Vietnam from Cambodia, speakers told a conference in HCM City on Thursday.

Unprecedented strikes against trade frauds and counterfeit products in 2019: Deputy PM

Unprecedented strikes against trade frauds and counterfeit products in 2019: Deputy PM

Market surveillance units last year cracked a number of major counterfeit rings countrywide as the fight against trade frauds took place on a scale never seen before, Deputy Prime Minister Truong Hoa Binh said.

 
 

Other News

.
Vietnam emerges as the world’s No2 rice exporter
Vietnam emerges as the world’s No2 rice exporter
BUSINESSicon  27/07/2020 

Vietnam has beaten Thailand to become the second biggest rice exporter in the world after the latter decided to slash rice exports due to prolonged drought and strong baht.

Competitive power market still afar
Competitive power market still afar
BUSINESSicon  27/07/2020 

There are three criteria for assessing goods and services— including prices, quality and customer service. 

Standardization for agro-value chain
Standardization for agro-value chain
BUSINESSicon  27/07/2020 

When it officially takes effect, the EU-Vietnam Free Trade Agreement (EVFTA) will have a positive impact on promoting Vietnam’s exports, especially agro-products, to the EU.

Downhill likely after climax
Downhill likely after climax
BUSINESSicon  27/07/2020 

Rice is a rare spotlight in Vietnam’s agro-product exports in the first half of this year. However, the good performance may not be maintained in the second half of the year.

Vietnam imposes tariffs on foreign plastic film
Vietnam imposes tariffs on foreign plastic film
BUSINESSicon  26/07/2020 

The ministry of Industry and Trade (MoIT) has applied anti-dumping measures on some products with biaxially oriented polypropylene (BOPP) film originating from China, Thailand and Malaysia.

Improved quality and higher demand boost Vietnam rice export outlook
Improved quality and higher demand boost Vietnam rice export outlook
BUSINESSicon  27/07/2020 

In the first half of this year, rice export value jumped 18.6% year-on-year to US$1.71 billion.

Vietnam urged to be cautious about Chinese investment
Vietnam urged to be cautious about Chinese investment
BUSINESSicon  27/07/2020 

Growing Chinese investment to Vietnam could turn the Southeast Asian country into a transshipment point for China to reroute its exports to a third country.

Vietnam gov’t to offer extraordinary incentives for high-impact FDI projects
Vietnam gov’t to offer extraordinary incentives for high-impact FDI projects
BUSINESSicon  26/07/2020 

By fulfiling certain criteria, some foreign investors would receive special treatment, said Minister of Planning and Investment Nguyen Chi Dung.

Australian firm alleged of transfer pricing worth over US$116 million
Australian firm alleged of transfer pricing worth over US$116 million
BUSINESSicon  26/07/2020 

The State Audit Office of Vietnam requested the police to investigate the case.

Vietnam construction industry stays positive during Covid-19
Vietnam construction industry stays positive during Covid-19
BUSINESSicon  26/07/2020 

The construction industry grew 4.5% year-on-year during the first six months of 2020, which was higher than the GDP growth rate of 1.8%.

EC allows Vietnamese exporters to extend deadline of REX applications
EC allows Vietnamese exporters to extend deadline of REX applications
BUSINESSicon  26/07/2020 

The European Commission (EC) has given the green light for Vietnam’s exporters to extend the deadline of applying for the registered exporter system (REX) until late 2020, 

Southern Vietnamese real estate market: emergence of large M&A deals
Southern Vietnamese real estate market: emergence of large M&A deals
BUSINESSicon  26/07/2020 

The southern real estate market has witnessed a series of impressive mergers and acquisitions (M&A) deals. This trend is expected to be more vibrant in the near future. 

E-wallet providers ask to extend deadline of verification
E-wallet providers ask to extend deadline of verification
BUSINESSicon  26/07/2020 

 E-wallet service providers want to extend the deadline for users to complete identity verification.

Ministry launches PayGov to upgrade national public portal
Ministry launches PayGov to upgrade national public portal
BUSINESSicon  26/07/2020 

The Ministry of Information and Communications (MIC) launched a national payment support gateway (PayGov) yesterday in Ha Noi in the latest move to boost e-government in Vietnam.

Pandemic ravages household businesses and MSMEs: survey
Pandemic ravages household businesses and MSMEs: survey
BUSINESSicon  26/07/2020 

The COVID-19 pandemic has substantially reduced revenue for both household businesses (HBs) and micro, small and medium enterprises (MSMEs), 

Japanese firms choose Viet Nam for production expansion
Japanese firms choose Viet Nam for production expansion
BUSINESSicon  26/07/2020 

Fifteen Japanese firms chose Vietnam as the destination for their production expansion within the Japanese government’s programme to support Japanese firms to diversify their value chains in foreign countries, according to JETRO.

Vietnam Banks Association urges MIC to reduce telecommunication charges
Vietnam Banks Association urges MIC to reduce telecommunication charges
BUSINESSicon  26/07/2020 

The Vietnam Banks Association has just sent a dispatch to propose the Ministry of Information and Communications lower charges for banking services via SMS.

R&D spending key to join global supply chain: executives
R&D spending key to join global supply chain: executives
BUSINESSicon  25/07/2020 

Challenges will overwhelm opportunities for Vietnamese part suppliers if they are unable to find ways to upgrade technology and meet international production standards, business executives said on July 24.

Vietnam likely to export 6.7 million tonnes of rice this year
Vietnam likely to export 6.7 million tonnes of rice this year
BUSINESSicon  25/07/2020 

Vietnam is likely to reach its rice export target of 6.7 million tonnes this year thanks to favourable market conditions and high global demand, according to the Ministry of Agriculture and Rural Development.

Korean multinationals suggest solutions to ease difficulties in Covid-19
Korean multinationals suggest solutions to ease difficulties in Covid-19
BUSINESSicon  27/07/2020 

Vietnam Airlines’ airplanes which have been left idle because of Covid-19 could be used to carry cargo, offering benefits to both the air carrier and export companies.

 
 
 
Leave your comment on an article

OR QUICK LOGIN