Circular No. 16/2004/TT-BTC dated March 10, 2004 of the Ministry of Finance guiding the implementation of the Government’s Decree No. 99/2004/ND-CP dated February 25, 2004 which promulgates Vietnam’s list of goods and their import tax rates for implementation of the early harvest program under the Framework Agreement on ASEAN-China comprehen-sive economic cooperation

CIRCULAR

GUIDING THE IMPLEMENTATION OF THE GOVERNMENTS DECREE No. 99/2004/ND-CP OF FEBRUARY 25, 2004 WHICH PROMULGATES VIETNAMS LIST OF GOODS AND THEIR IMPORT TAX RATES FOR IMPLEMENTATION OF THE EARLY HARVEST PROGRAM UNDER THE FRAMEWORK AGREEMENT ON ASEAN-CHINA COMPREHEN-SIVE ECONOMIC COOPERATION

In furtherance of Article 6 of the Early Harvest Program (hereinafter abbreviated to EHP) of the Framework Agreement on ASEAN-China comprehensive economic cooperation (hereinafter called the Framework Agreement for short), signed in Phnom Penh, Cambodia on November 4, 2002;

In furtherance of the Governments Decree No. 99/2004/ND-CP of February 25, 2004 promulgating Vietnams 2004-2008 list of goods and their import tax rates for implementation of the Framework Agreements EHP,

The Ministry of Finance hereby guides the implementation thereof as follows:

I. SCOPE OF APPLICATION

1. Goods imported from ASEAN countries and China, which

(i) Being on Vietnams list of goods and their import tax rates participating in the EHP, promulgated together with the Governments Decree No. 99/2004/ND-CP of February 25, 2004;

(ii) Being imported into Vietnam from ASEAN member countries or China, which sign the Framework Agreement and participate in the EHP, including the following

- Brunei Darussalam (hereinafter called Brunei);

- The Kingdom of Cambodia (hereinafter called Cambodia);

- The Republic of Indonesia (hereinafter called Indonesia);

- The Peoples Democratic Republic of Laos (hereinafter called Laos);

- Malaysia;

- The Federation of Myanmar (hereinafter called Myanmar);

- The Republic of Singapore (hereinafter called Singapore);

- The Kingdom of Thailand (hereinafter called Thailand);

- The Peoples Republic of China (hereinafter called China).

Particularly for the Republic of the Philippines (hereinafter called the Philippines), which is an ASEAN member country participating in signing the Framework Agreement but not yet committing to participate in implementing the EHP, goods of the Philippines origin imported into Vietnam, which are on Vietnams list of goods and their import tax rates for implementation of the EHP, promulgated together with the Governments Decree No. 99/2004/ND-CP of February 25, 2004, shall not be eligible for the EHP preferential import tax rates. After the Philippines

(iii) Being transported directly to Vietnam from a member country participating in the EHP and satisfying the ASEAN-China goods origin requirement, being granted certificates of ASEAN-China goods origin Form E (as prescribed in Part III of this Circular) under the provisions of the Trade Ministers Decision No. 1727/2003/QD-BTM of December 12, 2003.

2. Goods of export-processing enterprises in Vietnam, when being sold into the domestic market with the EHP preferential import tax rates, must fully satisfy the following conditions:

(i) Being on Vietnams list of goods and their import tax rates participating in the EHP, promulgated together with the Governments Decree No. 99/2004/ND-CP of February 25, 2004;

(ii) Satisfying the ASEAN-China goods origin requirement, evidenced by certificates of the ASEAN-China goods origin Form E, granted by the Ministry of Trade or a body authorized by the Ministry of Trade.

II. EHP PREFERENTIAL IMPORT TAX RATES

1. The import tax rates applicable to import goods eligible for the EHP preferential tax rates as prescribed in Part I of this Circular shall be the EHP tax rates for each year, corresponding to the EHP tax rates for each of those years, specified in Vietnams list of goods and their tax rates for implementation of the EHP, promulgated together with the Governments Decree No. 99/2004/ND-CP of February 25, 2004 (hereinafter called the EHP preferential tax rates for short). The EHP preferential tax rates for each year shall automatically apply as from January 1 to the end of December 31 of such year, starting from 2004.

2. For goods imported from ASEAN countries and goods sold by export-processing enterprises in Vietnam into the domestic market, the importers may select the lowest of the following import tax rates at the time of importation under the tariff preference programs which Vietnam has parti-cipated in if the application conditions are fully met:

(i) The EHP preferential import tax rates;

(ii) The preferential import tax rates under the Agreement on Common Effective Preferential Tariffs for materializing the ASEAN Free Trade Area;

(iii) The MFN preferential import tax rates;

preferential import tax rates, for which Vietnam has participated in bilateral commitment with an ASEAN member country (if any).

3. For goods imported from China, the importers may select the lowest of the following import tax rates at the time of importation under the tariff preference programs which Vietnam has participated in if the application conditions are fully met:

(i) The EHP preferential import tax rates;

(ii) The MFN preferential import tax rates;

(iii) Other preferential import tax rates, for which Vietnam has participated in bilateral commitment with China (if any).

4. In cases where there are changes in the commodity items in the legal documents promulgated by ASEAN countries or by China for implementation of the EHP, that affect the right to enjoy Vietnams special preferential import tax rates as prescribed in Part I of this Circular, the Ministry of Finance shall provide appropriate guidance for each specific case.

III. CERTIFICATES OF ASEAN-CHINA GOODS ORIGIN

1. The rules according to which goods are recognized to originate from ASEAN countries or China are defined in the Regulation on goods origin applicable to the EHP, promulgated together with the Trade Ministers Decision No. 1727/2003/QD-BTM of December 12, 2003.

2. The certificates of origin must contain signatures and seals compatible with the official specimen signatures and seals of the following agencies of ASEAN member countries or China participating in the EHP, which are competent to grant certificates of ASEAN-China goods origin:

(i) In Brunei: The Ministry of Industry and Natural Resources or an authorized agency;

(ii) In Cambodia: The Ministry of Trade or an authorized agency;

(iii) In Indonesia: The Ministry of Trade and Industry or an authorized agency;

Laos: The Ministry of Trade or an authorized agency;

(v) In Malaysia: The Ministry of Foreign Trade and Industry or an authorized agency;

Myanmar: The Ministry of Trade or an authorized agency;

(vii) In Singapore: The Customs or an authorized agency;

(viii) In Thailand: The Ministry of Trade or an authorized agency;

(ix) In China: The Ministry of Trade or an authorized agency;

(x) In Vietnam: The Ministry of Trade or agencies authorized by the Ministry of Trade.

The signatures and seals on the certificates of goods origin Form E must be compatible with the specimen signatures and seals notified by competent agencies of ASEAN member countries or China.

3. In case of suspicion of the truthfulness and accuracy of the certificates of goods origin Form E, the customs offices shall be entitled:

(i) To request the re-examination of the certificates of ASEAN-China goods origin Form E. The customs offices shall send their requests to the exporting countries agencies competent to grant such certificates, requesting the certification;

(ii) To suspend the application of the EHP preferential tax rates and temporarily collect tax at the rates specified in the current preferential or ordinary import tariff;

(iii) To request the importers to provide additional documents (if any) to prove that their goods actually originate from ASEAN countries or China, within 01 (one) year;

the re-examination results, to continue filling in the procedures for the release of goods according to the ordinary import regulations;

(v) When having enough documents to evidence the goods ASEAN-China origin, the customs offices shall have to carry out procedures to reimburse the importers the difference between the tax amounts temporarily collected according to the current preferential or ordinary import tariff and the tax amounts calculated at the EHP preferential tax rates.

IV. OTHER REGULATIONS

1. In cases where commercial invoices are issued by the third party other than exporters, goods imported into Vietnam shall still enjoy the EHP preferential tax rates if they fully satisfy the conditions prescribed in this Circular.

2. The regulations on tax calculation bases, the regimes of tax collection, payment, exemption, reduction and reimbursement, the handling of violations and other regulations shall comply with the provisions of the Law on Export Tax and Import Tax and current guiding documents.

V. ORGANIZATION OF IMPLEMENTATION

This Circular takes implementation effect 15 days after its publication in the Official Gazette and applies to the import goods declarations submitted to the customs offices as from January 1, 2004.

In the course of implementation of this Circular, if meeting with any difficulties or problems, units should promptly report them to the Ministry of Finance for appropriate additional guidance.