Việt Nam advances electronic certificates of origin issuance to boost competitiveness

Việt Nam advances electronic certificates of origin issuance to boost competitiveness

The implementation of electronic certificates of origin (C/O) instead of traditional paper forms, along with the self-certification mechanism, is becoming a key focus in the administrative reform of export procedures in Việt Nam, according to the Ministry of Industry and Trade (MoIT).

Export cargo containers at Tân Vũ port, Hải Phòng. — VNA/VNS Photo

The collaboration between the MoIT, local departments of industry and trade and the business community plays an essential role in optimising the process, ensuring compliance with international commitments, and enhancing the competitiveness of Vietnamese goods in the global market.

However, the adoption of electronic C/O still depends on the approval of the customs authorities of the importing countries, as certificates of origin are a basis for determining whether goods are eligible for tariff preferences under free trade agreements.

Most C/Os issued by the MoIT and relevant authorities are currently processed on electronic platforms. However, some C/O forms under international agreements and partnerships still require physical copies.

According to the MoIT’s Agency for Foreign Trade (AFT), Việt Nam has fully implemented electronic C/O in three frameworks: ASEAN (10 member countries); ASEAN-Korea (AK); and Việt Nam-Korea (VK).

In these frameworks, C/O data is transmitted directly through the National Single Window to both Vietnamese customs and the customs of the importing countries, creating a fully digital processing environment without the need for paper-based C/O.

For C/O forms such as EUR.1 (EVFTA), EUR.1 UK/HUKA (UKVFTA), and EAV (Việt Nam-EAEU FTA), while the issuance process is electronic, the original certificate still needs to be printed and sent to the importer for customs procedures.

In addition, not all international commitments that Việt Nam participates in allow businesses to self-certify origin.

In ASEAN, traders who want to self-certify must obtain written approval from the departments of industry and trade or the competent C/O issuing authorities. This step is mandatory to ensure that businesses understand and comply with origin rules.

In other markets, such as the EU or the US, the self-certification mechanism has its own principles.

For example, in the EU, businesses do not need written approval from the departments of industry and trade and are allowed to self-certify origin for shipments under 6,000 euro (US$7,055).

However, when customs authorities inspect, businesses must still prove the legitimacy of the origin. Failure to do so may result in penalties.

In practice, the tax recovery and fines could be higher than the value of the shipment, so businesses need to be cautious when applying the self-certification mechanism, noted AFT.

The implementation of electronic C/O and the self-certification mechanism is an important step in the reform of administrative procedures and the enhancement of export capacity.

Therefore, the agency recommended businesses to fully understand the types of C/O and applicable frameworks; familiarise themselves with the C/O issuance process, self-certification of origin and related legal risks; cooperate closely with MoIT, local departments of industry and trade and relevant authorities; and prepare proper documentation, data, and production plans that meet the rules of origin.

Effective collaboration between government agencies and businesses would help Việt Nam move towards a fully digital export environment, improve transparency, reduce costs and time, and ensure the rights of businesses in the process of international integration, it noted. 

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