Circular No. 39/2015/TT-BTC dated March 25, 2015 of the Ministry of Finance prescribing customs value of exported and imported goods

CIRCULAR

Prescribing customs value of exported and
imported goods[1]

Pursuant to June 23, 2014 Law No. 54/2014/QH13 on Customs;

Pursuant to November 29, 2006 Law No. 78/2005/QH11 on Tax Administration and November 20, 2012 Law No. 21/2012/QH13 Amending and Supplementing a Number of Articles of the Law on Tax Administration;

Pursuant to November 29, 2005 Law No. 50/2005/QH11 on Intellectual Property and June 19, 2009 Law No. 36/2009/QH12 Amending and Supplementing a Number of Articles of the Law on Intellectual Property;

Pursuant to the Agreement on the Implementation of Article VII of the General Agreement on Tariffs and Trade;

Pursuant to the Government’s Decree No. 08/2015/ND-CP of January 21, 2015, detailing and providing measures to implement, the Customs Law regarding customs procedures and customs inspection, supervision and control;

Pursuant to the Government’s Decree No. 83/2013/ND-CP of July 22, 2013, detailing a number of articles of the Law on Tax Administration and the Law Amending and Supplementing a Number of Articles of the Law on Tax Administration;

Pursuant to the Government’s Decree No. 215/2013/ND-CP of December 23, 2013, defining the functions, duties, powers and organizational structure of the Ministry of Finance;

At the proposal of the General Director of Customs,

The Minister of Finance promulgates the Circular prescribing customs value of exported and imported goods as follows:

Chapter I

GENERAL PROVISIONS

Article 1.Scope of regulation and subjects of application

1. Scope of regulation: This Circular prescribes customs value of exported and imported goods.

2. Subjects of application: Organizations and individuals exporting and/or importing goods, customs offices, customs officers and other related organizations and individuals.

Article 2.Interpretation of terms

These terms used in this Circular shall be construed as follows:

1.  Goods purchase and sale contract means an agreement on goods purchase and sale established in writing or in an equivalent form including telegram, telex, fax or data message. According to the contract, the seller is obliged to deliver goods, transfer the ownership of goods to the buyer, and receive payment; the buyer is obliged to pay the seller, receive goods and the ownership of goods according to the agreement; goods are transferred from the seller to the buyer through Vietnam’s border gate or from a non-tariff zone to the inland market andvice versa.

Seller includes goods seller and service provider.

2. Purchase commission means an amount of money that the buyer pays his/her representative agent for purchasing imported goods at the most reasonable cost.

3. Sale commission means an amount of money that the seller pays his/her representative agent for selling exported goods to the buyer.

4. Brokerage fee means an amount of money that the buyer or the seller or both the buyer and seller shall pay to the broker for acting as an intermediary in the purchase and sale of imported goods.

5. Software means data, programs or instructions presented in form of commands, codes, schemas or any other forms that enables a data processing device to perform a specific task or to produce a specific outcome when it is installed in such device. Under this provision, audio recordings, video recordings or pictures are not considered software.

6. Intermediate media include floppy disk, CD, DVD, magnetic tape, magnetic card, external drive and any other items that can store information, are used as a temporary storage medium or used for transferring software. For use, software is transferred, installed or integrated into data processing devices. Intermediate media do not include integrated circuits, chips, semiconductors and similar devices or components installed on such circuit boards or devices.

7. Values of goods are considered “approximate” with one another if the difference between them is affected by the following objective factors:

a/ The nature of goods, characteristics of the industry;

b/ The seasonality of goods;

c/ Insignificant commercial difference.

Two values shall be converted to the same trading conditions in order to determine their approximation.

8. Identical exported goods means exported goods that are alike in every respect including:

a/ Physical characteristics including the surface of product, constituting materials, manufacturing methods, functions, uses and mechanical, physical and chemical properties;

b/ Product quality;

c/ Brand;

d/ Being made in Vietnam by the same manufacturer or by an authorized manufacturer or a franchisee.

9. Identical imported goods means imported goods that are alike in every respect, including:

a/ Physical characteristics including the surface of product, materials, manufacturing methods, functions, uses and mechanical, physical and chemical properties, having the same code in the List of Vietnam’s imports and exports;

b/ Product quality;

c/ Brand;

d/ Being made in the same country by the same manufacturer or by an authorized manufacturer or a franchisee.

Imported goods that are basically the same with minor differences in appearance like color, size and pattern that do not affect their value are also considered identical imported goods.

Imported goods are not considered identical if in the process of manufacturing any of these goods, technical designs, construction designs, development plans, aesthetic designs, design drawings, plans, sketches or similar products or services, which are made in Vietnam and supplied free of charge by the buyer to the seller, are used.

10. Similar exported goods means goods which are not alike in every respect but have the same substantial characteristics, including:

a/ Being made of equivalent materials and by the same manufacturing method;

b/ Having the same functions and uses;

c/ Having equivalent quality;

d/ Being commercially interchangeable, in other words, being accepted by the buyers in substitution for similar goods;

dd/ Being made in Vietnam by the same manufacturer or by an authorized manufacturer or a franchisee.

11. Similar imported goods means goods which are not alike in every respect but have the same substantial characteristics, including:

a/ Being made of equivalent materials and by the same manufacturing method;

b/ Having the same functions and uses;

c/ Having similar quality;

d/ Being commercially interchangeable, in other words, being accepted by the buyer in substitution for similar goods;

dd/ Being made in the same country, by the same manufacturer or by an authorized manufacturer or a franchisee, imported into Vietnam.

Imported goods are not considered similar if, in the process of manufacturing of any of these goods, technical designs, construction designs, development plans, aesthetic designs, design drawings, plans, sketches or similar products or services, which are made in Vietnam and supplied free of charge or with discount by the buyer to the seller, are used.

12. Date of exportation means the date on which the bill of lading is issued. In case no bill of lading is available, the date of exportation is the date on which the customs declaration of imported goods is registered.

13. Imported goods of the same class or category means goods that have the same origin and belong to a group or a combination of groups of goods manufactured by the same industry or in the same field. Identical imported goods and similar imported goods are goods of the same category.  

For example: Construction steel products, including steel rods, wound coils and sections (U, I or V shape) manufactured by the steel industry, are regarded as goods of the same category.

a/ In the method of customs valuation based on the deductible value, “imported goods of the same class or category” are goods imported from any other countries into Vietnam, regardless of their origin;

b/ In the method of customs valuation based on the computed value, “imported goods of the same class or category” must be imported  goods that have the same origin as the one of goods under customs valuation.

14. Objective and quantifiable data means specific data of additions or subtractions relating to the imported goods under custom valuation that are presented in the agreement or documents of the transaction parties.

Article 3.Rights and obligations of customs declarants; responsibilities and powers of customs offices

1. Customs declarants shall themselves declare and carry out customs valuation according to the principles and methods of customs valuation prescribed in June 23, 2014 Law No. 54/2014/QH13 on Customs, the Government’s Decree No. 08/2015/ND-CP of  January 21, 2015, detailing, and providing measures to implement, the Customs Law regarding customs procedures and customs inspection, supervision and control, and this Circular; take responsibility before law for the accuracy and truthfulness of the declared contents and the results of customs valuation; submit or produce documents at the request of the customs offices according to Article 3 of the Circular on customs procedures, customs supervision and inspection, import and export duties, and tax administration of imported and exported goods; hold consultations to clear doubts of the customs offices about declared value; request the customs offices to make written notifications of dutiable values, bases and methods used for customs valuation in case the customs value is determined by the customs offices.

2. When inspecting the declaration and customs valuation of exported or imported goods of customs declarants, the customs offices may request the declarants to submit or produce documents related to the methods of determining declared value according to the provisions of this Circular to prove the accuracy and truthfulness of such declared value;

3. The customs offices shall determine the customs value according to the principles and methods of customs valuation, value database and relevant documents mentioned in this Circular in the following cases:

a/ The customs declarant cannot determine the customs value by using the methods prescribed in this Circular;

b/ The cases specified in Clauses 2 and 5, Article 17 of this Circular.

Chapter II

CUSTOMS VALUATION

Section I

PRINCIPLES AND METHODS OF CUSTOMS VALUATION

Article 4.Principleand methods of customs valuation applicable to exported goods

1. Principle: The customs value is the selling price of goods at the border gate of exportation exclusive of international insurance cost (I) and international freight cost (F), and determined according to the methods provided in Clause 2 of this Article.

2. Methods of customs valuation:

a/ The selling price of goods at the border gate of exportation shall be determined according to the selling price written in the purchase and sale contract or other forms that have legal validity equivalent to such contract, commercial invoices and documents relevant to the actually exported goods;

b/ If the customs value cannot be determined according to Point a of this Clause, the customs value is the value of identical or similar exported goods contained in the value database at the time nearest to the date on which the export declaration of the goods under customs valuation is registered, converted to the selling price at the border gate of exportation. If more than one customs value of identical or similar exported goods are determined, the lowest one shall be used.

Article 5.Principle and methods of customs valuation applicable to imported goods

1. Principle: The customs value is the buying price of goods at the first border gate of importation, determined according to the methods provided in Clause 2 of this Article.

2. Methods of customs valuation: The buying price at the first border gate of importation shall be determined by applying successively six methods of customs valuation specified in Articles 6, 8, 9, 10, 11 and 12 of this Circular until the customs value can be determined. Methods of customs valuation include:

a/ Method based on transaction value;

b/ Method based on transaction value of identical imported goods;

c/ Method based on transaction value of similar imported goods;

d/ Method based on deductible value;

dd/ Method based on computed value;

e/ Deductive method.

If requested in writing by a customs declarant, the method based on deductible value and the method based on computed value can be interchanged.

Article 6.Transaction value-based method

1. Transaction value is the actual payment or future payment for imported goods after being adjusted under Articles 13 and 15 of this Circular.

2. The actual or future payment for imported goods is the total amount that the buyer has paid or shall pay directly or indirectly to the seller to purchase the imported goods, including:  

a/ The buying price written on the commercial invoice;

b/ The adjustments prescribed in Articles 13 and 15 of this Circular;

c/ The amounts payable by the buyer but not included in the buying price written on the commercial invoice, including:

c.1/ Advance payment, deposit for the production, trade, transport and insurance of goods;

c.2/ Indirect payments to the seller (for example: amounts that the buyer pays to a third party at the request of the seller; or amounts paid by offsetting debts).

3. The transaction value shall be applied if the following conditions are fully satisfied:

a/ The buyer faces no restriction on the right to dispose of or use the goods after the importation, except the following ones:

a.1/ Restrictions prescribed by Vietnamese law such as regulations that imported goods shall be affixed with Vietnamese-language labels, goods are subject to conditional import or imported goods are subject to a certain form of inspection before customs clearance;

a.2/ The restriction on places where goods may be sold;

a.3/ Other restrictions that do not affect the value of goods. These restrictions are one or many factors that is or are directly or indirectly related to the imported goods without leading to an increase or a decrease in the actual price paid for such goods.

For example: A car seller requests a buyer not to sell or display an imported car before the model of such car is introduced on the market.

b/ The price or sale of goods does not depend on the conditions or the payments due to which the value of goods subject to customs valuation cannot be determined.

For example: The seller sets the selling price of imported goods on the condition that the buyer will buy a certain quantity of other goods; the price of the imported goods depends on the prices of other goods which will be sold by the importer to the exporter.

In case the trade or price of the goods depends on one condition or several conditions but the buyer possesses objective documents for the determination of the pecuniary impact of such dependence, such condition(s) shall still be regarded as being satisfied. Upon the customs valuation, the money amount reduced due to the impact of such dependence shall be added to the transaction value.

c/ After reselling, transferring or using the imported goods, except the additions specified at Point e, Clause 2, Article 13 of this Circular, the buyer is not required to pay any sum from the money collected from the disposal of the imported goods;

d/ The buyer and the seller have no special relationship; if any, such relationship does not affect the transaction value prescribed in Article 7 of this Circular.

4. Determination of customs value of imported goods containing software

a/ Customs value of imported goods being intermediate media carrying software is the actual or future payment for the imported goods, exclusive of the value of software used in the processing devices for the data they contain if on the commercial invoice the value of software is separated from the value of intermediate media;

b/ Customs value is the actual or future payment for imported goods inclusive of the value of software and expense for installing the software in the imported goods in any of the following cases:

b.1/ On the commercial invoice, the value of the software is not separated from the value of intermediate media;

b.2/ The actual or future payment for the software is related to the additions prescribed in Article 13 of this Circular;

b.3/ The software is recorded, installed or integrated in imported goods being other than intermediate media.

5. Documents for valuation using this method include:

a/ The goods purchase and sale contract;

b/ Documents proving the special relationship (if any) not affecting the transaction value;

c/ Documents proving the amounts (if any) payable by the buyer but not yet included in the buying price written on the commercial invoice;

d/ Documents proving the additions (if any);

dd/ Documents proving the subtractions (if any);

e/ Other documents proving the customs valuation based on the transaction value declared by the customs declarant.

Article 7.Special relationship

1. A seller and a buyer shall be regarded as having a special relationship in any of the following cases:

a/ Both of them are employees or one is an employee and the other is the director of another enterprise;

b/ Both of them are general partners contributing capital to the same business that is legally recognized;

c/ One of them is a person employing the other;

d/ One has the power to control the other;

dd/ They are both controlled by a third party;

e/ They both control a third party;

One having the power to control the other as referred to at Points d, dd and e of this Clause means a person who can directly or indirectly restrict or instruct the other person.

g/ They have any of the following family ties: husband and wife, parent and child recognized by law, grandparent and grandchild with consanguinity, aunt or uncle and nephew or niece, siblings, brothers or sisters-in-law;

h/ A third person owns, controls or holds at least 5% of the voting shares of both parties;

i/ Parties associated in business with one another with one party being the sole agent, sole distributor or sole franchisor of the other party shall be regarded as having a special relationship if the relationship is conformable with one of the provisions at Points a thru h above.

2. The special relationship between a seller and a buyer does not affect the transaction value if it satisfies either of the following conditions:

a/ The purchase and sale transaction between the buyer and the seller is carried out in the same manner as the purchase and sale transaction of the same imported goods with buyers that do not have special relationship with the seller. The customs office shall inspect the manner in which the relationship between the seller and the buyer is established and the manner of negotiation to reach the declared price, then come to the conclusion whether or not the declared value is influenced by special relationship;

For example:

- The sale price of the imported goods has been negotiated and agreed in the commercial contract in a manner conformable with the normal pricing negotiation and agreement practices of that commodity line or with the manner the seller offers the goods price to other buyers that have no special relationship with the seller.

- Imported goods sale price includes general expenses and profit corresponding to general expenses and profit from the sale of goods of the same class or category.

b/ The transaction value of the imported goods is approximates to any of the following values of the goods exported to Vietnam on the same day or within 60 days before or after the date of exportation of the goods being proved:

b.1/ The customs value determined based on the transaction value of identical or similar imported goods sold to other importers that have no special relationship with the exporter (the seller);

b.2/ The customs value of identical or similar imported goods determined according to the deductible value-based method specified in Article 10 of this Circular;

b.3/ The customs value of identical or similar imported goods determined according to the computed value-based method specified in Article 11 of this Circular.

3. The customs values prescribed at Point b, Clause 2 of this Article are used for comparison purposes only and the customs value of identical or similar imported goods shall be converted to the same condition with the imported goods being proved as follows:

a/ Conversion to the same trading condition: The conversion of the customs value of identical or similar imported goods to the same trading condition with the goods being proved must comply with Point b, Clause 2 Article 9 of this Circular; or,

b/ Adjustment of the additions and subtractions according to Articles 13 and 15 of this Circular.

4. Procedures for declaration and inspection:

a/ At the time the declaration is registered, if the seller and the buyer have a special relationship that does not affect the transaction value, the customs declarant shall fill in both the declaration of imported goods and the declaration of customs value for the cases subject to customs value declaration;

b/ On the basis of the available information, if doubting that the special relationship may affect the transaction value, the customs office shall make a notification and hold a meeting enabling the customs declarant to explain and provide the information clarifying such special relationship to prove that such relationship does not affect the transaction value of the imported goods prescribed in Clause 2 of this Article.

Article 8. Method based on transaction value of identical imported goods

1. Applicable cases: If the customs value cannot be determined according to the transaction value-based method prescribed in Article 6 of this Circular, the customs value of the imported goods shall be determined according to the method based on transaction value of identical imported goods.

2. The method based on transaction value of identical imported goods shall be applied under Article 9 of this Circular, replacing the term “similar imported goods” with the term “identical imported goods”.

Article 9.Method based on transaction value of similar imported goods

1. Applicable cases: If the customs value cannot be determined according to the methods prescribed in Articles 6 and 8 of this Circular, the customs value of imported goods shall be determined according to the method based on transaction value of similar imported goods, provided the similar imported goods have received the approval of the customs office for customs valuation according to the transaction value-based method and have the same trading condition and condition of time of exportation as those of the imported goods being valued as prescribed in Clause 2 of this Article.

In case there are not any similar imported goods with the same trading condition as that of the imported goods being valued, a similar imported goods with different trading conditions may be chosen and shall be converted to the same trading condition.

2. Conditions for choosing similar imported goods: Similar imported goods shall be chosen if fully satisfying the following conditions:

a/ Condition of time of exportation:

Similar imported goods must be those exported to Vietnam on the same day or within 60 days before or after the date of exportation of the imported goods being valued.

b/ Trading conditions:

b.1/ Condition of commercial level and quantity:

b.1.1/ Similar imported goods must be those with the same commercial level and in the same quantity as those of the imported goods being valued;

b.1.2/ In case there are not any imported goods specified at Point b.1.1 of this Clause, imported goods with the same commercial level but different quantity may be chosen and the transaction value of these similar imported goods shall be converted to having the same quantity as the imported goods being valued;

b.1.3/ In case there are not any imported goods specified at Points b.1.1 and b.1.2 of this Clause, imported goods with different commercial level but the same quantity may be chosen and the transaction value of these similar imported goods shall be converted to having the same commercial level as the imported goods being valued;

b.1.3/ In case there are not any imported goods specified at Points b.1.1, b.1.2 and b.1.3 of this Clause, imported goods with different commercial level and quantity may be chosen and the transaction value of these similar imported goods shall be converted to the same commercial level and quantity as those of the imported goods being valued;

b.2/ Condition of distance and mode of transportation and insurance:

Similar imported goods must be those having or converted to having the same distance and mode of transportation as those of the imported goods being valued.

Any significant difference in insurance cost shall be converted to the same insurance condition as that of the imported goods being valued.

c/ When applying the method based on transaction value of similar imported goods, only if there are not any similar imported goods made by the same manufacturer or an authorized manufacturer, may goods made by another manufacturer with the same origin be considered.

d/ If two or more transaction values of similar imported goods can be determined by using this method, the lowest transaction value after being converted to having the same trading condition as that of the goods being valued shall be used as the customs value.

If during customs clearance, the information for choosing identical or similar imported goods to the imported goods being valued is insufficient, the customs valuation prescribed in Article 8 or 9 of this Circular shall be skipped and the next method shall be used.

3. Documents for customs valuation according to this method, 1 copy each, include:

a/ The customs declaration of similar imported goods;

b/ The customs value declaration of similar imported goods, applicable to the cases subject to customs value declaration;

c/ The contract on transport of similar imported goods (in case of conversion of transportation cost);

d/ The insurance contract of similar imported goods (in case of conversion of insurance cost);

dd/ A list of selling prices of exported goods issued by the overseas manufacturer or seller (in case of conversion of quantity and commercial level);

e/ Other documents relating to the customs valuation.

Article 10. The deductible value-based method

1. Applicable cases: If the customs value cannot be determined according to the methods prescribed in Articles 6, 8 and 9 of this Circular, the customs value of the imported goods shall be determined according to the deductible value-based method using the selling unit price of imported goods, identical or similar imported goods on Vietnam’s inland market according to Clause 2 of this Article after deducting reasonable expenses and profit obtained from selling the imported goods.

This method is not applicable if the goods chosen for determining selling unit prices fall into either of the following cases:

a/ The goods are not yet sold on Vietnam’s inland market or the sale of the goods has not been recorded on accounting books according to Vietnam’s accounting law;

b/ The goods are related to aid provided by any person according to Point d.1, Clause 2, Article 13 of this Circular.

2. The selling price of imported goods on Vietnam’s market shall be determined according to the following principles:

a/ The selling price of imported goods is the actual selling price of such goods on Vietnam’s market. If the actual selling price of imported goods subject to customs valuation is unavailable, the actual selling price of identical or similar imported goods in the original conditions as when imported on Vietnam’s market shall be used.

Imported goods in the original condition as when imported are imported goods that see neither change in shape, characteristics, nature and uses nor value increase or decrease since importation.

b/ The importer and the domestic buyer have no special relationship as prescribed in Article 7 of this Circular;

c/ The selling price level shall be determined according to the highest sales sufficient for forming the unit price. The selling price level according to the highest sales is the price at which the greatest aggregate quantity of goods is sold among the sale transactions at the initial commercial level right after importation;

d/ Goods shall be sold (wholesaled or retailed) on the earliest day after the importation and within 90 days (calendar days) after the day on which such goods are imported. The earliest day after the importation is the day on which goods are sold sufficiently to form the unit price (at least 10% of the quantity of imported goods).

3. Conditions for choosing selling unit prices on Vietnam’s market:

a/ It must be the selling unit price of the imported goods subject to customs valuation or identical or similar imported goods that are sold in the original condition as when imported;

b/ It must be the unit price at which the greatest aggregate quantity of goods is sold, which is sufficient for forming the unit price. Goods are sold on the earliest day after the importation and within 90 days after the day on which the goods subject to customs valuation are imported. The domestic buyer and the seller must have no special relationship.

For example: Goods lot A consists of many goods items, in which item B is subject to customs valuation according to the deductible value-based method. Goods lot A is imported on January 1, 2014. A goods lot consisting of an item identical to item B was imported earlier and sold to many domestic buyers at different prices and at different times as follows:

In the example above, the selling unit price chosen for deduction is VND 800/unit corresponding to the greatest sales (450 units) sufficient for forming the unit price. This unit price satisfies the conditions for choosing the selling price, including:

- Having the greatest aggregate quantity (450) in the imported goods sold early after the importation.

- The selling time is within 90 days after the date of importation.

4. Deduction principle:

The determination of deductions shall be based on the accounting figures and documents that are lawful, available and conformable to Vietnam’s accounting regulations and standards. The deductions must be those allowed to be accounted as reasonable expenses of enterprises according to Vietnam’s Accounting Law.

5. Deductions to be made from the selling unit price:

Deductions to be made from the selling unit price are reasonable expenses and profit earned from the sale of goods on Vietnam’s market, including:

a/ Costs of transport and insurance and expenses for other activities related to the transportation of goods after their importation, specifically:

a.1/ Costs of transport and insurance and expenses for other activities related to the transportation of goods incurred during the transportation from the first border gate to the warehouse of the importer or to the place of delivery in inland Vietnam;

a.2/ Costs of transport and insurance and expenses for other activities related to the transportation of goods from the warehouse of the importer in inland Vietnam to the place of sale, in case the importer bears such costs and expenses.

b/ Taxes, charges and fees payable in Vietnam upon the importation and sale of the imported goods on Vietnam’s inland market;

c/ Commissions or general expenses and profit related to the sale of the imported goods in Vietnam:

c.1/ If the importer is a sale agent for a foreign trader, the commission shall be deducted. If such commission is inclusive of expenses specified at Points a and b of this Clause, such expenses shall not be deducted;

c.2/ In case of importation by the mode of definitive purchase and sale, general expenses and profit shall be deducted: General expenses and profit shall be considered generally when determining the deductible value. The determination and distribution of general expenses and profit to imported goods must comply with Vietnam’s accounting regulations and standards.

General expenses include direct and indirect expenses for the importation and sale of goods on the domestic market, such as expenses for marketing goods, expenses for storage and preservation of goods before sale, expenses for management of the importation and sale of goods.

Bases for determining deductions are data recorded and reflected on accounting records of the importer that are conformable with Vietnam’s accounting regulations and standards. These data must be consistent with those obtained from the trade of imported goods of the same class or category in Vietnam.

6. The customs value of goods imported through processing in Vietnam shall be determined according to the principle prescribed in Clause 1 of this Article after deducting the processing expenses that increase the value of goods. The method of customs valuation prescribed in this Article is inapplicable to the following cases:

a/ The imported goods, after being processed, are no longer in the same condition as when imported and their increase in value due to processing is unidentifiable;

b/ The imported goods, after being processed, still sustain the same characteristics, nature and uses as when imported but they constitute only part of the goods sold on Vietnam’s market.

7. Documents for customs valuation according to this method include:

a/ The sale or added-value invoice according to regulations;

b/ Sale agency contract, in case the importer is the sale agent of the exporter. This contract must specify the commission that the agent may earn and the costs that the agent shall pay;

c/ Written explanation of sales and accounting records reflecting the costs and expenses mentioned in Clause 5 of this Article;

d/ The customs declaration and the customs value declaration of the goods chosen for deduction;

dd/ Other necessary documents for inspection and customs valuation.

Article 11. The computed value-based method

1. Applicable cases: If the customs value cannot be determined according to the methods prescribed in Articles 6, 8, 9 and 10 of this Circular, the customs value of the imported goods shall be determined according to the computed value-based method. The computed value of imported goods includes:

a/ Direct expenses for producing the imported goods: the cost price or value of raw materials and materials, expense for the manufacture of, or other processing for manufacturing, the imported goods. These expenses may also include:

a.1/ The expenses specified at Points a, b and c, Clause 2, Article 13 of this Circular;

a.2/ The value of the aids as prescribed at Point d.1, Clause 2, Article 13 of this Circular;

a.3/ The value of the aids prescribed at Point d.1, Clause 2, Article 13 of this Circular shall be included in the customs value only when the manufacturer bears the cost of such aid products.

b/ General expenses and the profits from the sale of goods of the same class or category as that of imported goods subject to customs valuation and made in the country of exportation for sale to Vietnam. The profits and general expenses shall be considered generally when determining the computed value.

General expenses include all direct and indirect expenses for the manufacture and sale for exportation of goods but not yet calculated according to Point a of this Clause.

c/ The cost of transport, cost of insurance and expenses related to the transportation of imported goods must comply with Points g and h, Clause 2, Article 13 of this Circular.

2. Bases for determining computed value:

Bases for determining computed value are data recorded and reflected on accounting records of the manufacturer unless such data are unconformable with those obtained in Vietnam. These such data must be consistent with those obtained from the manufacture and trade of imported goods of the same class or category that are made in the country of exportation for export to Vietnam.

3. Any accounting records or other documents of the entities living outside Vietnam’s territory shall not be inspected or asked to be produced for inspection for the purpose of determining the computed value prescribed in this Article.

The verification of the information provided by the manufacturer serving the customs valuation prescribed in this Article may be conducted outside of Vietnam’s territory if so agreed by the manufacturer. Advance notification of such verification shall be made to a competent agency of the relevant country for approval.

4. Documents for customs valuation according to this method include:

a/ The manufacturer’s written explanation about the expenses mentioned at Points a and b, Clause 1 of this Article, containing the manufacturer’s certification of the accounting records and data conformable to such explanation;

b/ The sale invoice of the manufacturer;

c/ Documents of the expenses mentioned at Point c, Clause 1 of this Article.

Article 12. Deductive method

1. Applicable cases: If the customs value cannot be determined according to the methods prescribed in Articles 6, 8, 9, 10 and 11 of this Circular, the customs value shall be determined according to the deductive method using the documents and data that are objective and available at the time of customs valuation.

The customs value determined according to the deductive method is the customs value determined by applying successively and flexibly the methods of customs valuation specified in Articles 6, 8, 9, 10 and 11 of this Circular according to Clause 2 of this Article until the customs value is determined.

2. When determining the customs value according to this method, the customs declarant and the customs office may not use the following values:

a/ The selling price on the domestic market of goods of the same kind made in Vietnam;

b/ The selling price of goods in the domestic market of the exporting country;

c/ The selling price of goods for exporting to a third country;

d/ The manufacture costs of goods, excluding those used in the computing method;

dd/ The minimum dutiable value;

e/ The value determined by the customs office not according to the principles and methods of customs valuation specified in this Circular or the value provided by the customs declarant before carrying out goods trading activities for importing goods to Vietnam;

g/ The higher of the two alternative values as the customs value.

3. Some examples of flexible application of methods of customs valuation:

a/ Application of the  transaction value-based method of identical or similar imported goods.

If there are no identical or similar imported goods exported to Vietnam on the same day or within 60 days before or after the date of exportation of the imported goods being valued, identical or similar imported goods exported within a longer duration that does not exceed 90 days before or after the date of exportation of the goods being valued may be chosen.

b/ The deductible value-based method may be used for customs valuation in either of the following ways:

b.1/ If no unit price is determined for deduction within 90 days from the date of importation, the selling unit price of goods sold in the greatest aggregate quantity within 120 days from the date of importation of the goods chosen for deduction may be chosen;

b.2/ If there is no reselling unit price of the very imported goods or identical or similar imported goods to a person having no special relationship with the importer, the reselling unit price of goods for the buyer having special relationship with the importer may be chosen on the condition that the special relationship does not influence the price in the sale transaction.

c/ The customs value of the imported goods determined based on the customs value of the identical imported goods which has been determined according to the deductible value- or computed value-based method.

d/ The customs value of the imported goods determined based on the customs value of the similar imported goods which has been determined according to the deductible value- or computed value-based method.

4. Apart from the cases specified in Clause 3 of this Article, the flexible application of the methods of customs valuation may be based on the price database but may not violate the provisions of Clause 2 of this Article.

5. Documents: the documents related to the customs valuation by applying flexibly the methods prescribed in Articles 6, 8, 9, 10 and 11 of this Circular.

Article 13.Additions

1. Additions may be made only when the following conditions are fully satisfied:

a/ These additions are paid by the buyer and have not been included in the actual or future payment;

b/ These additions are related to the imported goods;

c/ There are objective and quantifiable data conformable with the relevant documents.

If the imported goods have additions without objective and quantifiable data for determining customs value, such value shall not be determined according to the transaction value-based method but the next method instead.

2. The additions:

a/ Sale commission cost, brokerage fee. If these costs include payable taxes in Vietnam, such taxes are not required to be added to the customs value of imported goods.

b/ Cost of packing associated with imported goods, including buying price of packing and other costs related to the purchase and transportation of packing to the place of goods packaging and preservation.

Containers, casks and racks used as a means of packaging for transporting goods and used many times are not considered packing associated with goods so they are not the addition related to the cost of packing associated with goods.

c/ Packaging cost, including:

c.1/ The cost for packaging materials including the buying price of packaging material and other costs related to the purchase and transport of packaging materials to the place of packaging;

c.2/ The cost for packaging workers, including the wages and costs related to the employment of workers to package the goods being valued.

If the buyers have to bear the expenses for accommodation and travel for workers during the packaging, these expenses shall be also included in the cost for packaging workers.

d/ Aid: The value of goods and services that the buyer provides free of charge or with discount and are transferred directly or indirectly to the manufacturer or seller to produce and sell exported goods to Vietnam.

d.1/ The aids include:

d.1.1/ Raw materials, components, accessories and their similar products constituting or inserted in imported goods;

d.1.2/ Raw materials, materials and fuel consumed in the manufacture of imported goods;

d.1.3/ Instruments, tools, dies, molds, models and similar products used for manufacturing imported goods;

d.1.4/ Design drawings, technical drawings, aesthetic designs, development plans, construction designs, model designs, diagrams, sketches and similar products and services which are made in foreign countries and necessary for the manufacture of imported goods.

d.2/ Valuation of the aids:

d.2.1/ If the aids are products or services bought from a person without special relationship to provide for the seller, the value of the aids is the buying price of such products or services;

d.2.2/ If the aids are products or services produced by the importer or a person with special relationship with the importer to provide for the seller, the value of the aids is the cost price of such products or services;

d.2.3/ If the aids are products or services made by an overseas-based manufacturing facility of buyer without documents for accounting separately such products or services, the value of the aids shall be determined by distributing the total cost of production in the same period of such facility for the quantity of the products or services produced;

d.2.4/ The value of the aid rented by the buyer is the renting cost;

d.2.5/ The value of the aid being used products is the residual value of such products;

d.2.6/ For the aid goods that were processed by the buyer before handing over to the seller for use in manufacturing the imported goods, the added value resulting from the processing shall be added to the value of the aid;

d.2.7/ If the aid is sold with discount by the buyer to the exporter, the value of such discount shall be added to the customs value;

d.2.8/ If after the manufacture of imported goods, the manufacturer still obtains superfluous raw materials and materials and scraps from the aid goods, the value of recovered superfluous raw materials and materials and scraps shall be subtracted from the value of the aid, if there are data showing the value of the scraps or superfluous raw materials and materials.

The determined value of the aids includes all expenses related to the purchase and sale, transportation and insurance to the place where the imported goods are produced.

d.3/ Distribution of the value of the aids to the imported goods.

d.3.1/ Principle of distribution:

d.3.1.1/ The value of the aids shall be completely distributed to the imported goods;

d.3.1.2/ The distribution shall be recorded in writing in a lawful manner;

d.3.1.3/ The distribution must comply with Vietnam’s accounting regulations and standards.

d.3.2/ Methods of distribution:

The customs declarant shall himself/herself distribute the value of the aids to the imported goods by any of the following methods:

d.3.2.1/ Distributing to the quantity of imported goods of the first importation;

d.3.2.2/ Distributing according to the quantity of manufactured goods up to the time of the first importation;

d.3.2.3/ Distributing to all of goods intended to be manufactured according to the purchase and sale agreement between the buyer and the seller (or the manufacturer);

d.3.2.4/ Distributing according to the principle of descending or ascending;

d.3.2.5/ In addition to the methods above, the buyer may apply other methods of distribution (for example, distribution by month, quarter or year), on the condition that the distribution must comply with the law on accounting regime and shall be recorded in writing.

dd/ The copyright fee and licensing fee specified in Article 14 of this Circular.

e/ The sum that the importer shall pay from the proceeds from resale, disposal or use of imported goods shall be transferred directly or indirectly to the seller in any form. Procedures for declaration and inspection are as follows:

e.1/ In case this sum can be determined at the time the declaration is registered:

e.1.1/ The customs declarant shall himself/herself declare in the relevant box in the imported goods declaration, or the customs value declaration applicable to the case subject to customs value declaration;

e.1.2/ The customs office shall conduct inspection and process the inspection results according to Article 25 of the Circular on customs procedures; customs supervision and inspection; export and import duties and tax administration of exported and imported goods.

e.2/ In case the sum cannot be determined at the time the declaration is registered due to the dependence on post-import sales or for other reasons specified in the goods purchase and sale contract or other separate documents of agreement:

e.2.1/ At the time of registration of the declaration, the customs declarant shall clearly declare the reason for not determining the sum of money that the importer is obliged to pay after reselling, disposing of or using imported goods on the imported goods declaration or the customs value declaration applicable to the case subject to customs value declaration. Within 5 days from the date of actual payment, the customs declarant shall declare and calculate the payable tax for the actually paid sum on the additional declaration after customs clearance, and fully pay the tax according to regulations;

e.2.2/ The customs office shall check the documents related to this sum of money and the declaration of the customs declarant according to Point e.2.1 of this Clause, and shall:

e.2.2.1/ Issue a sanctioning decision according to regulations and request the customs declarant to declare or make additional declaration, in case the customs declarant fails to declare or declares a sum unconformable with the actual payment. If the customs declarant fails to declare or make additional declaration as requested, the customs office shall carry out the customs valuation, assess the tax, collect the tax and late payment interest (if any) according to regulations;

e.2.2.2/ Impose a sanction according to regulations, in case the customs declarant fails to declare within the time limit specified at Point e.2.1 of this Clause.

g/ Transportation cost and any expenses related to the transportation of imported goods to the first border gate of importation, excluding expenses for loading, unloading and arranging goods onto and from the vehicles to the first border gate of importation.

If the expenses for loading, unloading and arranging the goods onto and from the vehicles to the first border gate of importation are included in the international transportation cost or in the actual or future payment, such expenses shall be deducted from the customs value of the imported goods if they fully satisfy the conditions specified in Clause 1, Article 15 of this Circular.

g.1/ The value of such adjustments shall be determined based on the transportation contract and documents related to the transportation of goods;

g.2/ In case the buying price is exclusive of the transportation cost but the buyer fails to present the lawful transportation contract or documents related to the transportation of goods, the transaction value-based method shall not be applied;

g.3/ In case the goods lot consists of multiple types of goods and the transportation contract or the documents related to the transportation of goods does or do not contain detailed information on each type of goods, the customs declarant may select to apply any of the following methods of distribution:

g.3.1/ Distribution on the basis of the transportation tariff of the carrier;

g.3.2/ Distribution by weight or volume of goods;

g.3.3/ Distribution according to the ratio of buying price of each type of goods to the total value of goods.

h/ Insurance cost of imported goods to the first border gate of importation.

h.1/ If the importer does not purchase insurance for goods, the insurance cost will not be added to the customs value;

h.2/ The insurance cost for a goods lot consisting of multiple types of goods without detailed information on each type of goods shall be distributed according to the value of each type of goods.

i/ The costs mentioned at Points g and h of this Clause are exclusive of payable value-added tax in Vietnam. If such tax is included in the transportation cost, international insurance cost or in the actual or future payment, it shall be allowed to be deducted from the customs value of the imported goods if fully satisfying the conditions specified in Clause 1, Article 15 of this Circular.

Article 14.Copyright fee and licensing fee

1. Copyright fee means an amount of money that the buyer shall pay directly or indirectly to the subject of intellectual property rights in order to be transferred the ownership or the right to use intellectual property rights.

a/ Intellectual property rights means the rights of organizations or individuals over an intellectual property, including copyright and copyright-related rights, industrial property rights and plant variety rights.

a.1/ Copyright means the right of organizations or individuals over the work they create or own;

a.2/ Copyright-related rights means the rights of organizations or individuals over their performances, audio recordings, video recordings, broadcast programs and satellite signals carrying encrypted programs;

a.3/ Industrial property rights means the rights of organizations or individuals over the inventions, industrial designs, layout designs of semiconductor integrated circuits, trademarks, trade names, geographical indications and trade secrets they create or own, and the right against unfair competition;

a.4/ Rights over plant varieties means the rights of organizations or individuals over new plant varieties they create or discover and develop or enjoy the ownership.

The rights above shall be exercised in accordance with the Law on Intellectual Property.

b/ Subject of intellectual property rights means the owner of intellectual property rights or any organization or individual that is transferred intellectual property rights by their owner.

2. Licensing fee means an amount of money that the buyers shall pay directly or indirectly to the subjects of intellectual property rights in order to perform some activities within the industrial property rights.

3. Copyright fee or licensing fee shall be added to the imported goods only when the following conditions are fully satisfied:

a/ The buyer pays the copyright fee or licensing fee for the use or transfer of intellectual property rights related to the imported goods being valued according to Clause 4 of this Article;

b/ Copyright fee or licensing fee are paid directly or indirectly by the buyer as a condition for the purchase and sale transaction of goods being valued according to Clause 6 of this Article and are specified in the purchase and sale contract, licensing contract or other agreement on transfer of intellectual property rights;

c/ The copyright fee or licensing fee has not been included in the actual or future payment of the imported goods being valued.

4. The copyright fee or licensing fee is considered being related to imported goods if:

a/ Copyright fee or licensing fee paid for the use of product brands associated with the documents relating to the agreement and payment of copyright fee or licensing fee if the following conditions are fully satisfied:

a.1/ Imported goods are resold in the original condition as when imported on Vietnam’s market or have undergone simple processing after they are imported according to the provisions of Clause 5 of this Article;

a.2/ Imported goods are affixed with trademarks when they are sold on Vietnam’s market.

b/ Copyright fee or licensing fee paid for the use of inventions, technical know-how or other intellectual property rights shown in the purchase and sale contracts, licensing contracts or other agreements on transfer of intellectual property rights if falling into any of the following cases:

b.1/ Inventions, technical know-how or other intellectual property rights are used for producing imported goods;

b.2/ Imported goods carry inventions, industrial designs or rights belonging to other intellectual property rights;

b.3/ Imported goods are machinery or equipment manufactured to apply inventions, technical know-how or rights belonging to other intellectual property rights.

Examples of copyright fee or licensing fee satisfying the condition “relating to imported goods” are provided in Appendix I to this Circular.

5. Simple processing after the importation covers:

a/ Preservation of goods during the transportation and storage (air ventilation, spreading out, drying, cooling or defrosting, pickling, inhalation of sulfur or addition of other additives, removal of broken parts, and similar jobs);

b/ Dusting, screening, selection, classification (including arrangement into sets), cleaning, painting, division into sections;

c/ Changing wrappings and dismantling or assembling batches of goods; bottling, packaging, boxing and other simple packaging jobs; simple jobs like husking, grinding, cutting, tearing, bending, rolling and peeling;

d/ Sticking labels, marks or other similar marks to products or wrappings of products;

dd/ Simply mixing imported goods with other ingredients, including diluting with water or other ingredients, provided that the basic characteristics of the products remain unchanged;

g/ Simply assembling parts of products to form finished products;

Simple assembly means assembly of details, components and parts together with assembly tools (screws, bolts, nuts) or rivets or by welding provided that these activities are simply assembly. The components and parts are not processed into finished products regardless of the complexity of assembly methods.

h/ Combination of two or more jobs specified at Points a thru g of this Clause;

i/ Slaughtering animals without processing.

6. Copyright fee or licensing fee shall be considered a condition for the purchase and sale of imported goods in either of the following cases:

a/ The buyer only purchases the imported goods from the supplier appointed by the intellectual property owner or the supplier related to the intellectual property owner; or the goods must satisfy the technical standards at the request of the intellectual property owner;

b/ The buyer only purchases the imported goods when he/she/it pays the copyright fee or licensing fee to the seller or the subject of intellectual property rights.

Examples of imported goods satisfying the condition “being a condition of imported goods purchase and sale transaction” are provided in Appendix I to this Circular.

7. The following amounts may not be added to the customs value:

a/ The amount of money that the buyer shall pay for the right to reproduce the imported goods or art works in Vietnam (for example: if a goods specimen is imported and used for producing copies exactly the same as the original specimen, then the amount of money paid for manufacturing goods according to the imported goods specimen is considered the right to reproduce imported goods);

b/ The amount of money that the buyer shall pay for the right to distribute or resell the imported goods, in case such amount is not considered a condition for imported goods purchase and sale transaction.

If the amount of money the buyer pays for the right to reproduce, distribute or resell the imported goods is included in the actual price or future payment, such amount may not be deducted from the customs value when determining the value of such imported goods.

8. Procedures for declaration and inspection:

a/ In case the copyright fee or licensing fee can be determined at the time the declaration is registered:

a.1/ The customs declarant shall himself/herself declare the amount of copyright fee or licensing fee in the imported goods declaration or the customs value declaration in the case subject to customs value declaration;

a.2/ The customs office shall conduct inspection and process the inspection result according to the provisions of Article 25 of the Circular on customs procedures; customs supervision and inspection; export and import duties and tax administration of exported and imported goods.

b/ If the copyright fee or licensing fee cannot be determined at the time the declaration is registered due to the dependence on post-import sales or other reasons specified in the goods purchase and sale contract or a separate document of agreement on the payment of copyright fee or licensing fee, the declaration and inspection procedures are as follows:

b.1/ At the time of registration of the declaration, the customs declarant shall declare in the imported goods declaration or the customs value declaration, applicable to the case subject to customs value declaration, the reason why the copyright fee or licensing fee cannot be declared. Within 5 days from the date of actual payment, the customs declarant shall make declaration, calculate the payable tax for the copyright fee or licensing fee actually paid in an additional declaration after customs clearance and fully pay the tax according to regulations;

b.2/ The customs office shall examine the documents relating to the copyright fee or licensing fee and the declaration of the customs declarant according to Point b.1 of this Clause, and shall:

b.2.1/ Make a sanctioning decision according to regulations and request the customs declarant to declare or make additional declaration, if the customs declarant fails to declare or declares an untruthful copyright fee or licensing fee. If the customs declarant fails to declare or make additional declaration as requested, the customs office shall carry out the customs valuation, assess the tax, fully collect the tax and/or late payment interest (if any) according to regulations;

 b.2.2/ Impose a penalty according to regulations, in case the customs declarant fails to declare within the time limit specified at Point b.1 of this Clause.

9. In case the copyright fee or licensing fee is determined partly based on the imported goods and partly based on other elements not related to the imported goods:

a/ If there are figures enabling the separation of the copyright fee and licensing fee related to the imported goods, such fee shall be added to transaction value;

b/ In case the copyright fee and licensing fee related to the imported goods are inseparable, the customs value shall not be determined according to the transaction value-based method but the next method instead.

Article 15. Subtractions

1. Subtractions can be made only when the following conditions are fully satisfied:

a/ There are objective and quantifiable data conformable with the relevant documents which are lawful and available at the time of valuation;

b/ These subtractions are included in the actual or future payment;

c/ The subtractions are conformable with Vietnam’s accounting law.

2. The subtractions:

a/ Costs for activities arising after the importation, including the cost of construction, architecture, installation, maintenance or technical assistance, technical consultancy, cost of supervision and similar costs;

b/ The costs of transportation and insurance when the goods have been transported to the first border gate of importation. If such costs are related to different types of goods without detailed information on each type of goods, they shall be distributed according to the principle at Point g or h, Article 13 of this Circular;

c/ The taxes, fees and charges payable in Vietnam included in the buying price of imported goods. If the taxes, fees and charges are related to different types of goods and cannot be separated, they shall be distributed according to the rate of buying value of each type of goods.

d/ Discount:

d.1/ Discount may be subtracted only when the following conditions are fully satisfied:

d.1.1/ The discount falls into any of the following cases:

d.1.1.1/ Discount according to the commercial level of the goods purchase and sale transaction;

d.1.1.2/ Discount according to the quantity of goods purchased and sold;

d.1.1.3/ Discount according to the form and time of payment.

d.1.2/ The discount is recorded in writing before loading goods onto the carrying vehicle in the country of exportation;

d.1.3/ There are objective and quantifiable data conformable with the documents for separating such discount from the transaction value. These documents shall be submitted together with the customs declaration;

d.1.4/ Payment is made via bank using the L/C method or TTR method for all the imported goods in the purchase and sale contract;

d.1.5/ Actual and declared value of the imported goods, commercial level, form and time of payment are conformable to the seller’s announcement of discount.

d.2/ Dossier of request for consideration of discount:

d.2.1/ A written request for subtraction of discount when the importation and payment for all the goods included in the contract are completed: 1 original;

d.2.2/ The goods purchase and sale contract: 1 copy;

d.2.3/ The list for monitoring the actual goods importation, made according to form No. 01/GG/2015  in Appendix II to this Circular, for the case goods included in a contract are imported in different shipments (using different declarations): 1 original;

d.2.4/ The seller’s announcement of discount: 1 copy;

d.2.5/ Documents of payment for all the goods included in the purchase and sale contract: 1 copy;

d.3/ Procedures for declaration and inspection of the discount and handling competence:

d.3.1/ Responsibilities of the customs declarant:

d.3.1.1/ To declare the discount in the box “detail of value declaration” on the import declaration or in the corresponding box on the customs value declaration, but do not subtract the discount on the customs value declaration;

d.3.1.2/ To calculate and pay the tax according to the value before subtracting the discount;

d.3.1.3/ To submit the dossier of request for consideration of discount according to Point d.2 of this Clause after completing the importation and payment for all the goods included in the purchase and sale contract.

d.3.2/ Responsibilities of the customs office:

The customs office receiving the dossier of request for consideration of discount from the customs declarant shall:

d.3.2.1/ Examine the dossier and enclosed relevant documents;

d.3.2.2/ Examine and compare the declared and actual values in terms of quantity, commercial level, form and time of payment against the seller’s announcement of discount;

d.3.2.3/ The director of the provincial-level Customs Department shall consider and decide to subtract the discount if the conditions specified at Point d.1 of this Clause are fully satisfied. The value of the discount must be under 5% of the total value of goods and the declared value must not be lower than the value of the reference price of identical goods on the list of imported goods facing risk in value. Other cases of discount shall be considered and decided by the General Director of Customs;

d.3.2.4/ Handle the differential tax amount due to the subtraction of discount according to regulations.

dd/ Expenses incurred by the buyer that are related to the marketing of imported goods, including:

dd.1/ Expenses for market research and survey about the to-be-imported goods;

dd.2/ Expenses for advertising the trademark or brand of the imported goods;

dd.3/ Expenses related to the display and introduction of the newly imported products;

dd.4/ Expenses for participation in trade fairs and exhibitions of the new products;

e/ Expenses for examination of quantity and quality of goods before importation. If such expenses have been agreed between the buyer and the seller and are included in the actual or future payment from the buyer to the seller, they may not be subtracted from the transaction value;

g/ Expense for opening the L/C, remittance charge for the payment for the imported goods, if such expense is paid by the buyer to his/her/its representative bank to make  payment for the goods;

h/ The interest at the rate according to the financial agreement of the buyer and related to the purchase of imported goods may be subtracted from the transaction value only if the following conditions are fully satisfied:

h.1/ Financial agreement is made in writing;

h.2/ The customs declarant can prove that at the time the financial agreement is implemented, the declared interest rate does not exceed the normal credit interest rate applicable in the country of exportation as well as the ceiling interest rate announced by the State Bank of Vietnam.

Article 16.Distribution of adjustments

1. If the addition or subtraction to or from the customs value of goods is eligible but the types of goods whose customs value is increased or decreased are not specified in the purchase and sale contract or relevant documents, the customs declarant may choose any of the methods of distribution specified in Clause 2 of this Article (except the adjustments subject to specific regulations on distribution in Articles 13 and 15 of this Circular) to distribute such adjustments for each type of goods on the principle that the value of the adjustment shall be wholly distributed to the imported goods whose customs value is adjusted.

2. Methods of distribution: The customs declarant may choose any of the following methods of distribution:

a/ Distribution according to quantity;

b/ Distribution according to weight;

c/ Distribution according to volume;

d/ Distribution according to invoice value.

Article 17.Customs value of exported and imported goods in some special cases

1. For the exported or imported goods without official price at the time of registration of the customs declaration, their customs value is the temporary price declared by the customs declarant according to the relevant documents that are available at the time of valuation. When the official price is available, their customs value shall be determined according to the method of valuation specified in Clause 2, Article 4, or Clause 2, Article 5, of this Circular. The procedures for determination are as follows:

a/ Temporary price:

a.1/ The customs declarant shall declare the temporary price in the corresponding box on the custom declaration when registering the declaration and the time the official price will be available in the box “Notes”.

a.2/ The customs office shall examine the temporary price and the time of availability of the official price according to Article 25 of the Circular on customs procedures, customs supervision and inspection, export and import duties and tax administration of exported and imported goods; supervise and urge the customs declarant to declare the official price right at the time it is available.

b/ Official price:

b.1/ The customs declarant shall declare the official price on the modified declaration after customs clearance and pay the differential tax amount (if any) within 5 working days after the official price is available.

b.2/ The customs office shall examine the declaration of the customs declarant, the time the official price is available, conditions for approval for such time according to the provisions at Point c of this Clause, and shall:

b.2.1/ Determine the customs value, assess the tax, fully collect the tax and/or late payment interest (if any), issue a decision on sanctioning administrative violation against the customs declarant who fails to declare or declare the official price at variance with regulations; issue a decision on sanctioning administrative violation against the customs declarant who fails to declare within the time limit specified at Point b.1 of this Clause;

b.2.2/ Handle the differential tax amount according to the regulations on handling of overpaid tax amounts in accordance with the Law on Tax Administration and guiding documents in case the amount of tax calculated according to the official price is lower than the paid tax amount calculated according to the temporary price;

c/ If the official price becomes available later than 90 days from the date the declaration is registered, the customs declarant shall make declaration and submit the purchase and sale contract and the commercial invoice (1 copy) proving the time the official price is available and take responsibility before law for the accuracy of such time. Based on the dossier, documents and the actual condition of the exported or imported goods, the Director of the provincial-level Customs Department shall examine, consider and decide on the approval of the time of availability of the official price and take responsibility for such decision.

d/ Conditions for approval of the time of availability of official price: The time of availability of official price shall be approved if the following conditions are fully satisfied:

d.1/ The purchase and sale contract includes an agreement about the time of availability of the official price appropriate to the exported or imported goods according to international practices;

d.2/ The time of availability of actual price matches the time of availability of official price according to the agreement included in the contract;

d.3/ The official price matches the actual or future payment for the exported or imported goods according to the payment documents.

In case the conditions for approval of the time of availability of the official price are not fully met and the tax amount calculated according to the official price is higher than the paid tax amount calculated according to the temporary price, the customs declarant shall pay the late payment interest for the differential tax amount.

2. For imported goods that are used in Vietnam for purposes other than those for which they were determined non-taxable goods, goods eligible for tax exemption, or considered for tax exemption:

a/ For the imported goods being automobiles or motorbikes: Customs value shall be determined based on the residual use value of goods according to the duration of use in Vietnam (from the time of importation shown on the customs declaration to the time of tax calculation) and specified as follows:

If the price declared at the time of importation of goods that are non-taxable, or eligible for tax exemption or consideration of tax exemption is lower than the price in the price database at the same time, the price in the price database and the rates above shall be used for customs valuation.

b/ For other imported goods: Customs value must be the actual or future payment at the time of change of use purpose and shall be determined according to the principles and methods of customs valuation prescribed in this Circular.

3. Customs value of the goods imported into Vietnam after being processed by a foreign party must be the expense for processing and the value of raw materials and materials used for the processing that are supplied by the foreign party and specified in the processing contract and the adjustment specified in Articles 13 and 15 of this Circular. The value of supplies and materials exported from Vietnam for processing according to the processing contract shall not be included in the customs value of the processed products.

4. For imported goods that are sent to a foreign country for repair and are taxable objects when imported to Vietnam, customs value must be the actual payment for repair of imported goods according to the documents relating to such repair.

5. For goods that are imported without purchase and sale contract or commercial invoice, customs value must be the declared value. If there are grounds proving that the declared value is unconformable, the customs office shall determine the customs value according to the principles and methods of customs valuation specified in Articles 8 thru 12 of this Circular.

6. For surplus imported goods in comparison with the purchase and sale contract or commercial invoice:

a/ For surplus imported goods that are identical or similar to the imported goods written on the purchase and sale contract or commercial invoice: Customs value of the surplus imported goods shall be determined according to the method of customs valuation of the imported goods written on the purchase and sale contract;

b/ For surplus imported that are goods different from the imported goods written on the purchase and sale contract or commercial invoice: Customs value shall be determined according to the methods of customs valuation specified in Articles 8 thru 12 of this Circular.

7. For imported goods unconformable to the purchase and sale contract or commercial invoice:

a/ For imported goods with improper specifications: Customs value shall be determined according to the actual payment for the imported goods. Goods with improper specifications are the actually imported goods that have colors, sizes and shapes different from the description in the purchase and sale contract and such differences do not affect the actual payment;

b/ For goods unconformable with the purchase and sale contract or commercial invoice other than those specified at Point a of this Clause: Customs value shall be determined according to the methods of customs valuation specified in Articles 8 thru 12 of this Circular.

8. Actually imported goods with quantity different from that written on the commercial invoice due to the characteristics of goods and conformable to the conditions of delivery and payment in the purchase and sale contract or commercial invoice: Customs valuation shall be based on the commercial invoice and the purchase and sale contract (the conditions of delivery, tolerance rate, natural characteristics of goods and conditions of payment). Customs value must not be lower than the actual payment written on the commercial invoice and relevant documents.

9. If imported goods are rented ones, customs value must be the actual or future payment for renting, conformable with the documents relating to the rental of such goods.

10. Exported or imported goods in other special cases: Provincial-level Customs Departments shall report them to the General Department of Customs for further reporting to the Ministry of Finance for consideration and decision on a case-by-case basis conformable with the principles of customs valuation of exported or imported goods.

Section II

CUSTOMS VALUE DECLARATION

Article 18.Subjects of customs value declaration

The customs value of imported goods shall be declared on customs value declarations, except the following cases:

1. Non-taxable goods, goods eligible for tax exemption or consideration for tax exemption in accordance with the Law on Export Duty and Import Duty;

2. Goods that are imported in the form of importing raw materials for export production;

3. Goods that are eligible for applying the transaction value-based method prescribed in Clause 3, Article 6 of this Circular and have customs value information declared sufficiently in the imported goods declarations of the Vietnam Automated Cargo and Port Consolidated System which calculates the customs value automatically;

4. Goods that are imported without purchase and sale contract or commercial invoice.

Article 19. The form of customs value declaration

1. The form for customs value declaration according to the transaction value-based method of the imported goods prescribed in Article 6 of this Circular: Form HQ/2015-TG1 and the instructions for declaration in Appendix III to this Circular.

2. The form for customs value declaration according to the methods prescribed in Articles 8 thru 12 of this Circular: Form HQ/2015-TG2 and the instructions for declaration in Appendix III to this Circular.

Article 20. Principles of filling in and submission of customs value declarations forms

1. The customs value shall be declared specifically in the customs value declaration form for each item of imported goods included in the imported goods declaration. The items declared in the customs value declaration form shall be numbered continuously and in accordance with the ordinal numbers of such items in the imported goods declaration.

2. The customs value declaration is an integral part of the imported goods declaration and shall be enclosed with the imported goods declaration when carrying out the customs procedures. The customs value declaration shall be made in 2 copies, one to be filed at the customs office and the other kept by the goods owner and shall be preserved together with the imported goods declaration according to law.

Section III

VALUE DATABASE

Article 21.Value database

1. Value database is information relating to the customs valuation of the exported and imported goods that is collected, synthesized and classified by the customs offices. The customs value database shall be created by the General Department of Customs in a centralized manner and constantly updated, including:  

a/ Customs price database management system;

b/ Lists of exported and imported goods facing risk in value enclosed with reference prices.

2. Sources of information for creation of the value database:

a/ Information from export and import dossiers includes available information on the export and import documents declared by customs declarants or collected by the customs offices when carrying out the customs procedures and after customs clearance;

b/ Information from the lists of exported and imported goods facing risk in value as prescribed in this Circular;

c/ Information about the compliance with the law by the enterprises: the information relating to the compliance with policies and laws by the enterprises in the declaration and valuation, their number of violations and seriousness of violation that the customs offices have collected and analyzed on the risk management system;

d/ Other sources of information: information collected by the customs offices or provided by other relevant agencies that has been verified in terms of reliability.

3. The value database shall be used for:

a/ Making the List of exported and imported goods facing risk in value;

b/ Examining the customs value of exported and imported goods;

c/ Serving the state management of import and export and other fields.

4. The General Director of Customs shall issue detailed regulations on creation, management and use of the value database.

Article 22.Competence to make and modify; and principles of use of, the list of exported and imported goods facing risk in value and reference prices

1. The General Director of Customs shall organize the selection and modification of:

a/ The goods items in the List of exported and imported goods facing risk in value on the basis of the results of risk assessment according to the criteria prescribed in Article 24 of this Circular, professional information, information and data available in the information system of the customs sector at the time of assessment. The List of exported and imported goods facing risk in value must include the information about the goods such as headings and names of goods;

b/ The reference prices of the goods items in the Lists of exported and imported goods facing risk in value on the basis of the information collected according to Article 25 of this Circular.

2. The List of exported and imported goods facing risk in value and reference prices shall be used as the basis for the customs office to compare and examine the values declared by the customs declarants when carrying out the customs procedures or when the goods have undergone customs clearance according to regulations. They shall not be used for imposing customs value and shall be used uniformly within the custom sector.

Article 23. Time limit and responsibility for selecting, adding and modifying goods items in the List of exported and imported goods facing risk in value and enclosed reference prices

1. The List of exported and imported goods facing risk in value and enclosed reference prices shall be made and modified biannually or in case of necessity on the basis of considering:

a/ Proposals of organizations and individuals;

b/ Suggestions of provincial-level Customs Departments and units of the General Department of Customs according to Clause 2 of this Article.

2. The director of a provincial-level Customs Department shall:

a/ Updating the results of documentary examination and physical inspection of goods, consultations and valuation, results of post-customs clearance inspection, and anti-smuggling investigation to the corresponding database system;

b/ Based on the results of documentary examination, physical inspection of goods and anti-smuggling investigation, turnover levels, export and import duty rates, the conditions of smuggling and commercial fraud, make proposals and reports to the General Department of Customs to:

b.1/ Add reference prices for exported and imported goods in the List of exported and imported goods facing risk in value without reference price according to the Report proposing additions to the List of exported and imported goods facing risk in value (Form No. 02/DMBX/2015  in Appendix II to this Circular) by collecting the information according to Article 25 (except Point h, Clause 1) of this Circular;

b.2/ Modify reference prices in case the declared prices and collected information increase or decrease over 10% in comparison with the reference prices in the List of exported and imported goods facing risk in value according to the Report proposing additions to the List of exported and imported goods facing risk in value (form No. 03/DMSD/2015  in Appendix II to this Circular) by collecting the information according to Article 25 (except Point h, Clause 1) of this Circular;

b.3/ Add to the List of exported and imported goods facing risk in value and reference prices the exported and imported goods satisfying any of the criteria specified in Article 24 of this Circular that have not been included in the List according to the Report proposing additions to the List of exported and imported goods facing risk in value by collecting the information according to Article 25 (except Point h, Clause 1) of this Circular.

3. The units of the General Department of Customs shall update to the corresponding data system of the General Department of Customs according to their functions and tasks of management of information sources specified in Clause 1, Article 25 of this Circular.

4. The Export-Import Duty Department (under the General Department of Customs) shall monitor, urge and direct the provincial-level Customs Departments to update the information and make the Report proposing additions to the List of exported and imported goods facing risk in value according to Clause 2 of this Article.

Article 24.Criteria for making and modifying the Lists of exported and imported goods facing risk in value

1. For exported goods:

a/ Goods with high export duty rate and export turnover;

b/ Goods with high frequency of violation in terms of customs value during the valuation;

c/ Goods facing risk of declaration of untrue transaction value for export duty fraud or evasion or added-value tax refund.

2. For imported goods:

a/ Goods with high import duty rate;

b/ Goods occupying high proportion in total import turnover;

c/ Goods with high frequency of violation in terms of customs value during the valuation;

d/ Goods facing risk of declaration of untrue transaction value for import duty fraud or evasion;

dd/ Goods facing risk of declaration of lower value for dumping into Vietnam’s inland market.

Article 25. Sources of information, elaboration, addition and modification of reference prices enclosed with the List of exported and imported goods facing risk in value

1. Information sources of the customs office:

a/ Information about import and export prices of identical or similar exported and imported goods of which the customs value declared by enterprises on the customs price data management information system has been approved by the customs offices;

b/ Information about results of documentary inspection and physical inspection of goods, consultation and modification of prices by provincial-level Customs Departments when carrying out the customs procedures that is daily updated to the customs price data management information system;

c/ Information about results of the handling of complaints about customs value by provincial-level Customs Departments and the General Department of Customs that is updated to the customs price data management information system;

d/ Information about results of the post-customs clearance inspection of the customs value by the post-clearance inspectors that is updated to the enterprise management information system serving post-customs clearance inspection and risk management;

dd/ Information about results of inspection and handling of customs value fraud by the anti-smuggling force during control and inspection activities that is updated to the information collection database system;

e/ Information about the situation of commercial fraud, about results of handling of violations during the classification in the risk management information system;

g/ Information about results of inspection by the inspectorates or other forces of the customs sector before, during or after customs clearance;

h/ Information from reports proposing additions and modifications of provincial-level Customs Departments according to Clause 2, Article 23 of this Circular.

2. Information sources outside the customs offices:

a/ Information about transaction prices on the international market (applicable to goods items with transaction prices on the international market) posted on the websites of the transaction markets of such items;

b/ Information about the declared priced that are posted on the websites of the line ministries in accordance with specialized laws;

c/ Information from specialized newspapers, magazines and documents for commodity lines like automobiles, motorbikes, electronics goods, iron and steel that is collected monthly by the customs office;

d/ Information about offer prices on the Internet from the official websites or the websites associated with the official websites, transaction prices on the international market (applicable to the goods items with transaction prices on the international market) posted on the websites of the transaction markets of such items;

dd/ Information about signs of commercial fraud in the value declaration provided for the customs office by related agencies such as the market management agency, police, commercial banks or by the ministries, sectors, tax agencies, associations, enterprises, organizations and individuals;

g/ Information from selling prices on the domestic market of the goods identical or similar to the exported or imported goods, the relationship between the market selling prices and selling prices (if any) of exported and imported goods that is collected periodically by the customs office or provided by the tax agency;

h/ Information about selling prices of goods to be exported to Vietnam that is provided by the customs authorities of foreign countries according to bilateral or multilateral customs cooperation agreements.

3. The above sources of information shall be collected within at least six months from the date of signing of the decision promulgating the applicable List of exported and imported goods facing risk in value. Once the information is collected, the Export-Import Duty Department shall analyze and convert such information to the same trading conditions and propose the General Director of Customs to promulgate the List of exported and imported goods facing risk in value and enclosed reference prices.

Chapter III

ORGANIZATION OF IMPLEMENTATION

Article 26.Effect

1. This Circular takes effect on April 1, 2015.

The following circulars and decisions are annulled:

a/ Circular No. 205/2010/TT-BTC of December 15, 2010, guiding the Government’s Decree No. 40/2007/ND-CP of March 16, 2007, prescribing the customs valuation of exported and imported goods;

b/ Circular No. 29/2014/TT-BTC of February 26, 2014, amending and supplementing a number of articles of Circular No. 205/2010/TT-BTC of December 15, 2010, guiding the Government’s Decree No. 40/2007/ND-CP of March 16, 2007, prescribing the customs valuation of exported and imported goods;

c/ Decision No. 30/2008/QD-BTC of May 21, 2008, issuing the customs value declaration form for tax calculation for imported goods and declaration instructions;

d/ Circular No. 182/2012/TT-BTC of October 25, 2012, amending and supplementing Clause 1, Section I of Decision No. 30/2008/QD-BTC of May 21, 2008, issuing the customs value declaration form for tax calculation for imported goods and declaration instructions;

dd/ Decision No. 1102/QD-BTC of May 21, 2008, on the creation, management and use of the price database.

2. The determination and inspection of the customs value of customs declarations registered from January 1, 2015, to the date before this Circular takes effect must comply with the guidance in the Minister of Finance’s Circular No. 205/2010/TT-BTC of December 15, 2010, and Circular No. 29/2014/TT-BTC of February 26, 2014.

3. During the implementation, if the relevant documents mentioned in this Circular and the appendices to this Circular are modified or replaced, such modified or replaced documents shall be applied.

4. The prior customs valuation of exported and imported goods; inspection of customs value during the customs clearance procedures; and inspection of value of goods after customs clearance must comply with the Minister of Finance’s Circular on customs procedures; customs supervision and inspection; export and import duties and tax administration of exported and imported goods.

Article 27.Implementation responsibilities

1. The General Department of Customs shall coordinate with the ministries, commodity line associations, and the units of the Ministry of Finance in collecting and exchanging information about prices to serve the inspection and determination of customs value under Article 25 of this Circular.

2. The directors of provincial-level Customs Departments shall organize the collection and processing of information and report to the General Department of Customs on the making and modification of the Lists of exported and imported goods facing risk in value prescribed in Clause 2, Article 23 of this Circular.

3. The customs offices, customs declarants, taxpayers and related organizations and individuals shall perform the customs valuation in accordance with this Circular. Any problems that arise during the implementation of this Circular should be reported to the Ministry of Finance and the General Department of Customs for consideration and settlement.-

For the Minister of Finance
Deputy Minister
DO HOANG ANH TUAN

* All appendices to this Circular are not translated.