Circular No. 60/2019/TT-BTC dated August 30, 2019 of the Ministry of Finance on amending and supplementing a number of articles of Circular No. 39/2015/TT-BTC of March 25, 2015, prescribing customs value of imported and exported goods

CIRCULAR

Amending and supplementing a number of articles of the Minister of Finance’s Circular No. 39/2015/TT-BTC of March 25, 2015, prescribing customs value of imported and exported goods[1]

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

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 (GATT 1994);

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; Decree No. 59/2018/ND-CP of April 20, 2018. amending and supplementing a number of articles of Decree No. 08/2015/ND-CP;

Pursuant to the Government’s Decree No. 87/2017/ND-CP of July 26, 2017, defining the functions, tasks, 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 amending and supplementing a number of articles of Circular No. 39/2015/TT-BTC of March 25, 2015, prescribing customs value of imported and exported goods.

Article 1.To amend and supplement a number of articles of Circular No. 39/2015/TT-BTC of March 25, 2015, prescribing customs value of imported and exported goods:

1. To amend Clause 5 of, and add Clauses 15, 16, 17, 18 and 19 to, Article 2 as follows:

“5. Application software means data, programs or instructions presented in the form of commands, codes, schemas or any other forms that, when being installed in a data processing equipment, for example: desktop, laptop or tablet, enables such equipment to perform a specific task or to produce a specific outcome as desired by the software user. Under this provision, sound products, films or images are not regarded as application software.

15.Paidmeans by the time of customs valuation, the buyer has fulfilled the payment obligation toward to seller in cash or by a cashless payment method or by debt offsetting between the two parties and such payment is expressed in actual payment documents between the buyer and the seller.

16.To be paidmeans by the time of customs valuation, the buyer has not yet fulfilled the payment obligation toward to seller in cash or by a cashless payment method or by debt offsetting between the two parties and there is no actual payment documents between the buyer and the seller.

17.Direct paymentmeans the buyer makes payment in cash or by a cashless payment method directly to the seller without any third parties. The credit institution that provides the service of payment between the buyer and the seller is not regarded as a third party.

18.Indirect paymentmeans the buyer makes payment in cash or by a cashless payment method to the seller via a third party at the request of the seller or the buyer requests a third party to make payment to the seller on its/his/her behalf or makes payment in the form of offsetting debts between the two parties. The credit institution that provides the service of payment between the buyer and the seller is not regarded as a third party.

19.Operating systemmeans data, programs or instructions presented in the form of commands, codes, schemas or any other forms that, when being integrated into machinery or equipment, serve as a communication interface between the user and machinery or equipment or provide an environment enabling the user to operate and control functions of machinery or equipment.”

2. To amend and supplement Article 3 as follows:

“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, Decree No. 59/2018/ND-CP of April 20, 2018, amending and supplementing a number of articles of Decree No. 08/2015/ND-CP,  and this Circular; take responsibility before law for the accuracy and truthfulness of declared contents and results of customs valuation; submit or produce documents at the request of customs offices according to the Circular on customs procedures; customs inspection and supervision; import duty and export duty and tax administration of imported and exported goods and this Circular; hold consultations to clear doubts of customs offices about customs value declared by customs declarants; request customs offices to make written notifications of customs value, customs valuation bases and methods in case the customs value is determined by customs offices.

2. When inspecting the declaration and determination of customs value of imported or exported goods by customs declarants, customs offices may request these declarants to submit or produce documents relating to methods of customs valuation according to the provisions of the Circular on customs procedures; customs inspection and supervision; import duty and export duty and tax administration of imported and exported goods and this Circular so as to prove the accuracy and truthfulness of the customs value determined and declared by customs declarants.

3. Customs offices shall determine customs value in the following cases:

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

b/ There is sufficient grounds and bases to reject customs value determined and declared by a customs declarant;

c/ There is a ground to believe that customs value determined and declared by a customs declarant is inappropriate.

4. When determining customs value, a customs office shall base itself on the principles, application order of customs valuation methods, customs value database, and relevant documents specified in this Circular and issue a notice of customs value according to Form No. 04/TGHQ provided in Appendix II to this Circular.

5. A customs office shall inspect and handle discounts within 5 working days after receiving a complete dossier as prescribed at Point d, Clause 2, Article 15 of this Circular.”

3. To supplement Article 4 as follows:

“Article 4.Principlesand methods of customs valuation applicable to exported goods

1. Principles:

a/ Customs value is selling price of goods at the border gate of exportation, exclusive of international insurance cost (I) and international freight (F) and shall be determined by applying the methods provided in Clauses 2, 3, 4 and 5 of this Article one after another until a custom value is identified.

b/ Customs valuation must be based on objective and quantifiable documents and data.

c/ Cost distribution principle: The costs prescribed in Clause 2 of this Article shall be calculated for exported goods of each category. In case a goods shipment contains goods of different categories but costs are not yet detailed for each category of goods, they shall be distributed by:

c.1/ Selling price of goods of each category; or

c.2/ Weight or volume or quantity of goods of each category.

2. Methods of determining selling price of goods at the border gate of exportation:

a/ Selling price of goods at the border gate of exportation is a selling price written in the goods purchase and sale contract or commercial invoice plus costs related to exported goods at the border gate of exportation in conformity with relevant documents, provided that such costs are not yet included in the selling price of goods.

b/ Method of determination:

b.1/ In case exported goods are delivered at the border gate of exportation: selling price of goods at the border gate of exportation is a selling price written in the goods purchase and sale contract or commercial invoice plus costs related to exported goods at the border gate of exportation in conformity with relevant documents, provided that such costs are not yet included in the selling price of goods.

b.2/ In case exported goods are not delivered at the border gate of exportation:

b.2.1/ If the place of goods delivery is outside the Vietnamese territory, selling price of goods at the border gate of exportation shall be determined on the basis of the selling price written in the goods purchase and sale contract or commercial invoice minus international insurance cost (I, if any) and international freight (F) for the distance from the border gate of exportation to the place of goods delivery;

b.2.2/ If the place of goods delivery is within the Vietnamese territory, selling price of goods at the border gate of exportation shall be determined on the basis of the selling price written in the purchase and sale contract or commercial invoice, plus the following costs:

b.2.2.1/ Domestic freight and other costs related to the transport of exported goods from the place of goods delivery to the border gate of exportation, including also costs of gathering goods, hiring warehouses, loading and unloading goods to and from carrying vehicles, and transporting goods to the border of exportation;

b.2.2.2/ Insurance cost of exported goods for the stretch of road from the place of goods delivery to the border gate of exportation (if any);

b.2.2.3/ Other costs related to exported goods occurred en route from the place of goods delivery to the border gate of exportation.

c/ Documents used for customs valuation by this method include (one copy for each document):

c.1/ Goods sale and purchase contract or commercial invoice;

c.2/ Documents relating to costs of exported goods at the border gate of exportation (if any);

c.3/ Other documents relating to selling price of goods at the border gate of exportation (if any);

3. The method of using selling price of identical or similar exported goods stated in the customs value database

a/ If applying this method, customs value of exported goods shall be determined based on selling price of identical or similar exported goods stated in the customs value database after being converted into selling price of goods at the border gate of exportation at the time nearest to the date of registration of the export declaration of the shipment subject to customs declaration.

b/ Cases where conversion is required:

b.1/ There is a difference in the stretch of road;

b.2/ There is a difference in the mode of transport.

c/ Conditions for application:

c.1/ Customs value of exported goods may be determined by this method on conditions that selling price of identical or similar exported goods determined and declared by enterprises by the method prescribed in Clause 2 of this Circular has been accepted by customs offices or is determined by customs offices by one of the methods prescribed in Clause 8, Article 1 of Decree No. 59/2018/ND-CP;

c.2/ The conversion required upon occurrence of a difference in the stretch of road or mode of transport may be made only when there are objective and quantifiable documents according to this method;

c.3/ In case two or more values of identical or similar exported goods can be determined at a time, customs value shall be the lowest among these values; customs values of identical or similar exported goods shipments of which declared values are doubted may not be used.

d/ Documents used for customs valuation by this method include (one copy for each document):

d.1/ Export customs declarations of identical or similar exported goods;

d.2/ Transport contracts or documents showing transport freight of identical or similar exported goods;

d.3/ Other documents relating to selling prices of identical or similar exported goods contained in the customs value database.

4. The method of using selling price of identical or similar goods in the Vietnamese market

a/ If this method is applied, customs value of goods shall be determined based on selling price of identical or similar goods in the Vietnamese market stated in goods sale invoices at the time nearest to date of registration of the export declaration of the goods shipment subject to customs valuation plus domestic freight and other related costs for transporting the goods to the border gate of exportation.

b/ Selling price of identical or similar goods in the Vietnamese market must be expressed in accounting books and documents and recorded in accordance with Vietnam’s accounting law. In case there exists more than one selling price at a time, the selling price with the highest cumulative sales shall be used.

c/ Domestic freight and other related costs for transporting goods to the border gate of exportation shall be added to the customs value only when there are objective and quantifiable documents;

d/ Documents used for customs valuation by this method include (one copy for each document):

d.1/ Goods sale invoices under regulations of the Ministry of Finance;

d.2/ Documents on domestic freight and costs used for customs valuation under Point a of this Clause.

5. The method of using selling price of exported goods collected, summarized and classified by customs offices

a/ Customs value of exported goods shall be determined by using selling price of goods summarized from different sources of information under Article 25 of this Circular after being converted into selling price at the border gate of the exported goods subject to customs valuation.

b/ In case there are more than one customs value after being converted, the lowest value shall be used; customs values of identical or similar goods shipments which are doubted under regulations may not be used.

c/ Documents used for customs valuation by this method include documents relating to selling price of goods collected from different sources of information and converted into selling price at the border gate of exportation (1 copy for each document).

6. Customs valuation of exported goods in special cases

For exported goods without goods sale and purchase contracts and commercial invoices, customs value is declared value. In case there are grounds to believe that declared price is inappropriate, customs offices shall carry out customs valuataion according to the principles and methods prescribed in this Article.”

4. To amend and supplement Article 5 as follows:

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

1. Principles:

a/ Customs value of imported goods is actual payable price of goods at the first border gate of importation and shall be determined by the methods prescribed at Points a thru e of this Article one after another until a custom value is identified;

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

c/ Customs valuation must be based on objective and quantifiable documents and data.

2. Methods of customs valuation of imported goods:

a/ Method based on transaction value of imported goods;

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.”

5. To amend and supplement Article 6 as follows:

“Article 6.Transaction price-based method

1. If being determined by this method, customs value of imported goods is transaction value of imported goods.

2. Transaction value of imported goods is price actually paid or to-be-paid by the buyer to purchase and import the goods after being adjusted under Articles 13, 14 and 15 of this Circular.

3. Actually paid or to-be-paid price of imported goods is total amount actually paid or to be paid by the buyer, directly or indirectly, to the seller to purchase imported goods, including the following amounts:  

a/ Buying price written on the commercial invoice;

b/ Amounts actually paid by the buyer but not yet included in the buying price written on the commercial invoice, including:

b.1/ Amounts actually paid or to be paid (for example, advance payment for goods, deposit for the production, trade, transport and insurance of goods);

b.2/ Indirect payments to the seller.

c/ Pluses and minuses prescribed in Articles 13, 14 and 15 of this Circular;

4. 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 goods after the importation, except the following restrictions:

a.1/ Restrictions prescribed by Vietnam’s law such as regulations that imported goods must bear 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/ Restriction on places where goods may be sold;

a.3/ Other restrictions that do not affect value of goods. These restrictions are one or many factors that is/are directly or indirectly related to imported goods without leading to an increase or a decrease in the price actually paid or to be 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/ Price or sale of goods does not depend on conditions or payments due to which value of goods subject to customs valuation cannot be determined.

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

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

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

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

5. In case imported goods are machinery and equipment with an operating system, customs value is transaction value of such machinery, equipment and operating system.

a/ In case the operating system is recorded or stored in a carrier media for installment in machinery and equipment after being imported:

a.1/ In case the value of the operating system is separated from the value of the carrier media, customs value is the transaction value of the machinery or equipment and operating system, exclusive of the value of the carrier media prescribed in Clause 6 of this Article;

a.2/ In case the value of the operating system is not separated from the value of the carrier media, customs value is the transaction value of the machinery or equipment and operating system, inclusive of the value of the carrier media.

b/ The value of the imported operating system may not be included in the customs value of machinery and equipment in the following cases:

b.1/ The operating system is imported to upgrade or replace the initially imported operating system whose value has been included in the value of imported machinery and equipment;

b.2/ The operating system is produced in Vietnam for being installed in imported machinery and equipment.

c/ In case the buyer has to pay costs for the right to use the operating system installed in machinery and equipment, the amount actually paid for the right to use the operating system shall be included in the value of imported machinery and equipment.

d/ Procedures for declaration and inspection:

d.1/ In case the operating system is imported together with machinery and equipment:

d.1.1/ The customs declarant shall determine and declare the customs value of machinery and equipment, including also the value of the operating system; and determine and declare the customs value of the carrier media (if any) on the customs declaration of imported machinery and equipment or customs value declaration (if any);

d.1.2/ The customs office shall conduct inspection and process the inspection result according to the Circular on customs procedures; customs inspection and supervision; import duty, import duty and tax administration of exported and imported goods.

d.2/ In case the operating system is not imported together with machinery and equipment:

d.2.1/ For the customs declarants:

d.2.1.1/ In case the operating system is imported before machinery and equipment are imported, the customs declarant shall declare and determine the value of the imported operating system under Point a of this Clause, declaring the use of the operating system for the to-be-imported machinery and equipment in the box “Description” and the commodity code of the to-be-imported machinery and equipment in the box “Heading”; determine and declare the customs value of carrier media (if any) on the import declaration of the operating system. When importing machinery and equipment, the customs declarant shall write the serial number of the import declaration of the operating system in the box “Details of value declaration” on the import declaration of machinery and equipment;

d.2.1.2/ In case the operating system is imported after machinery and equipment are imported, the customs declarant shall declare the commodity code(s) and customs value(s) of the operation system and carrier media (if any) as prescribed at Point d.2.1.1; and write the serial number of the import declaration of machinery and equipment in the box “Details of value declaration”.

d.2.2/ The customs office shall check documents relating to the value(s) of the imported operating system and carrier media (if any) and the declarations of the customs declarant and proceed as follows:

d.2.2.1/ If the customs declarant’s declarations do not conform with Point d.2.1, the customs office shall request the customs declarant to make additional declaration and handle the violation according to regulations. If the customs declarant fails to make the additional declaration within 5 working days after receiving the request for additional declaration, the customs office shall carry out the customs valuation, assess tax, collect tax and late-payment interest and handle the violation according to regulations;

d.2.2.2/ If the customs declarant declares and determines the customs value in accordance with Point d.2.1, the customs office shall approve the customs value determined and declared by the customs declarant.

6. In case the imported goods is carrier media carrying software for data processing equipment, the customs value is the price actually paid or to be paid for the carrier media, exclusive of the value of the software, provided the value of the software is separated from the value of carrier data on the commercial invoice;

7. Documents for customs valuation by this method include (one copy for each document):

a/ The goods purchase and sale contract, commercial invoice;

b/ Documents proving the special relationship not affecting the transaction value under Point a.2, Clause 4, Article 7 of this Circular upon requested by the customs office;

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

d/ Documents related to the additions (if any);

dd/ Documents related to the subtractions (if any);

e/ Other documents related to the customs value declared and determined by the customs declarant.”

7. To amend and supplement Clause 4, Article 7 as follows:

“4. Procedures for declaration and inspection:

a/ The customs declarant shall:

a.1/ Declare the special relationship between the buyer and seller on the declaration of imported goods and the declaration of customs value (if any), if at the time of registration of the customs declaration, the buyer and seller have a special relationship which, however, does not affect the transaction value;

a.2/ Provide documents proving the special relationship not affecting the transaction value upon requested by the customs office, specifically:

a.2.1/ Documents proving that the purchase and sale transaction is carried out in the same manner as the purchase and sale transaction between parties without a special relationship (if any);

a.2.2/ Documents proving that the transaction value of the good being valued is approximate or equal to the transaction value of identical or similar goods traded between parties without a special relationship (if any);

a.2.3/ Other relevant documents proving the special relationship not affecting the transaction value (if any).

b/ The customs office shall inspect and handle as follows:

b. l/ If the buyer and seller have a special relationship but the customs declarant fails to declare such relationship on the customs declaration and the customs value declaration (if any), the customs office shall request the customs declarant to make additional declaration under Article 29 of the Customs Law and sanction administrative violations under  regulations;

b.2/ If doubting that the special relationship between the buyer and seller affects the transaction value of the imported goods, the customs office shall compare the transaction value of the imported goods with the values prescribed at Point b, Clause 2 of this Article.

b.2.1/ If the transaction value satisfies the conditions specified at Point b, Clause 2 of this Article, the customs office shall accept the special relationship as not affecting the transaction value;

b.2.2/ If the transaction value does not satisfy the conditions specified at Point b, Clause 2 of this Article, the customs office shall request the customs declarant to provide the  information and documents prescribed at Point a.2 of this Clause for use as proof.

b.2.2.1/ If there are sufficient information and documents to prove that the special relationship does not affect the transaction value or there are not sufficient grounds to prove that the special relationship affects the transaction value, the customs office shall accept the customs value determined and declared by the customs declarant;

b.2.2.2/ If there are sufficient information and documents to prove that the special relationship affects the transaction value, the customs office shall reject the customs value determined and declared by the customs declarant and determine the custom value according to the principles and order of the methods specified in this Circular.

b.3/ The customs office shall not determine whether the special relationship affects the transaction value or not if the following conditions are fully satisfied:

b.3.1/ The customs office has inspected and accepted the special relationship as not affecting the transaction value;

b.3.2/ The transaction value of the imported goods being inspected is the same as that of identical imported goods which has been previously inspected and accepted.”

7. To amend and supplement Article 12 as follows:

“Article 12. Deductive method

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

2. The customs value determined by the deductive method is the customs value determined by applying the methods of customs valuation specified in Articles 6, 8, 9, 10 and 11 of this Circular one after another until a customs value is determined, provided that such valuation conforms with Clause 3 of this Article.

3. When determining the customs value by this method, the customs declarant and customs office may not use:

a/ The selling price on Vietnam’s market of goods which are of the same category and made in Vietnam;

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

c/ The selling price of goods for exportation to countries other than Vietnam;

d/ The manufacture costs of goods, except cases in which the manufacture costs of imported goods are used to determine the calculation value in the computed value-based method;

dd/ Reference prices in the list of imported goods facing risks in customs value;

e/ The value provided by the customs declarant before carrying out goods trading activities for importing goods into Vietnam;

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

4. The deductive method shall be applied as follows:

a/ Application of the method of using the transaction value of imported goods: In case the customs value of the goods cannot be determined by the method using the transaction value of imported goods due to unavailability of documents and quantifiable data on the additions or subtractions prescribed in Articles 13 and 15 of this Circular, the data on such additions or subtractions which are certified in writing by the supplier to the customs declarant shall be used.

b/ Application of the  method using the transaction value 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 shipment being valuated, identical or similar imported goods exported within a longer period which, however, must not exceed 90 days before or after the date of exportation of the goods being valuated, may be chosen.

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

c.1/ If it is impossible to determine the unit price used for deduction within 90 days from the date of importation, the unit price with the highest cumulative sales  within 120 days from the date of importation of the goods shipment will be chosen for deduction;

c.2/ If there is no re-selling unit price of the very imported goods or identical or similar imported goods to a person having no special relationship with the importer, the re-selling unit price of goods for a buyer having a special relationship with the importer may be chosen on the condition that the special relationship does not affect the re-selling unit price.

d/ The customs value of the imported goods shall be determined based on the customs value of the identical imported goods which has been determined by the  deductible value- or computed value-based method.

dd/ 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.

e/ If it is impossible to determine the value according to the provisions of Points a thru dd of this Clause, the application of the methods of customs valuation shall be based on the customs value database but must not violate Clause 3 of this Article.

5. Documents for customs valuation using this method include (1 copy for each document):

a/ Documents provided by the supplier certifying the adjustments, in case of applying the method of using the transaction value of imported goods;

b/ Customs declarations of identical or similar imported goods, in case of applying the method of using the transaction values of identical or similar imported goods;

c/ Sale invoices of the importer, in case of applying the deductible value-based method;

dd/ Other documents related to customs valuation using this method (if any).”

8. To amend and supplement Article 14 as follows:

“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 intellectual property right holder in order to be transferred the right to use subject matters of intellectual property rights.

a/ Intellectual property rights means rights of organizations or individuals to intellectual assets, including copyright and copyright-related rights, industrial property rights and rights to plant varieties;

a.1/ Copyright means right of organizations or individuals to works they have created or own;

a.2/ Copyright-related rights means rights of organizations or individuals to performances, phonograms, video recordings, broadcast programs and encrypted program-carrying satellite signals;

a.3/ Industrial property rights means rights of organizations or individuals to inventions, industrial designs, layout-designs of semiconductor integrated circuits, marks, trade names, geographical indications and trade secrets they have created or own, and the right to repression of unfair competition;

a.4/ Rights to plant varieties means rights of organizations or individuals to new plant varieties they have created, or discovered and developed, or own.

Contents of the rights above must comply with the Law on Intellectual Property.

b/ Holder 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 buyer shall pay directly or indirectly to the holder of intellectual property rights in order to perform some activities within the scope of 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 a copyright fee or licensing fee for the use or transfer of the right to use subject matters of intellectual property rights related to the imported goods being valuated according to Clause 4 of this Article;

b/ The copyright fee or licensing fee shall be paid directly or indirectly by the buyer as a condition for the purchase and sale transaction of the goods being valuated according to Clause 6 of this Article and such requirement is stated in the purchase and sale contract, licensing contract or other agreement on transfer of the right to use subject matters of intellectual property rights;

c/ The copyright fee or licensing fee has not been included in the price actually paid or to be paid for the imported goods being valuated.

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

a/ The copyright fee or licensing fee to be paid directly or indirectly for the use of product marks is conformable with the set of documents relating to the agreement and payment of copyright fee or licensing fee if the following conditions are fully satisfied:

a.1/ The imported goods are re-sold in the original condition on Vietnam’s market or have undergone simple processing after being imported according to the provisions of Clause 5 of this Article;

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

b/ The copyright fee or licensing fee to be paid directly or indirectly for the use of inventions, trade secrets, industrial designs, layout-designs of semiconductor integrated circuits or the right to use other subject matters of intellectual property rights shown in the purchase and sale contracts, licensing contracts or other agreements on transfer of the right to use subject matters of intellectual property rights if falling into any of the following cases:

b.1/ Inventions, trade secrets, layout-designs of semiconductor integrated circuits or the right to use other subject matters of intellectual property rights are used for producing imported goods;

b.2/ Imported goods carry inventions, industrial designs or the right to use other subject matters of intellectual property rights;

b.3/ Imported goods are machinery or equipment manufactured for application of inventions, trade secrets, designs of semiconductor integrated circuits, or rights to use other subject matters of 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/ Preserving goods during the transportation and storage (air ventilation, spreading out, drying, cooling, pickling, inhalation of sulfur or addition of other additives, removal of broken parts, and similar jobs);

b/ Dusting, screening, selecting, classifying (including arranging into sets), cleaning, painting, and dividing goods into sections;

c/ Changing packagings and dismantling or assembling batches of goods; bottling, packaging, boxing and other simple packaging jobs;

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

dd/ Simply mixing products of the same or different kinds;

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

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

i/ Slaughtering animals.

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

a/ The seller agrees with the buyer about the latter’s direct or indirect payment for the copyright fee or licensing fee related to imported goods;

b/ The seller agrees with the holder of intellectual property rights or licensor about the fact that goods shall be sold only to the buyer that makes direct or indirect payment for the copyright fee or licensing fee related to the owner of intellectual property rights or licensor;

c/ The seller supplies goods to the buyer as designated by the holder of intellectual property rights or licensor;

d/ The seller supplies goods to the buyer according to technical standards approved by the holder of intellectual property rights or licensor;

dd/ The buyer pays the copyright fee or licensing fee to the holder of intellectual property rights or licensor or another person as designated by the seller;

e/ There is evidence that the buyer can neither buy nor receive the imported goods if he/she/it fails to make direct or indirect payment for the copyright or licensing fee.

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

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

a/ The amount of money that the buyer shall directly or indirectly pay for the right to reproduce the imported goods or artistic works in Vietnam (for example: if a goods specimen is imported and then used for producing copies exactly the same as the original specimen of the imported goods, the amount of money paid directly or indirectly 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 directly or indirectly 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 directly or indirectly for the right to reproduce, distribute or resell the imported goods is included in the actual payment or future payment, it 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 (if any);

a.2/ The customs office shall conduct inspection and process the inspection result 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.

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 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  the reason why the copyright fee or licensing fee cannot be declared in the box “detailed customs value” in the imported goods declaration. In case the customs declarant has data on the copyright fee or licensing fee amount, he/she/it shall declare such fee amount in the imported goods declaration at the time of registration of the declaration and pay taxes according to regulations;

Within 5 days from the date of actual payment, the customs declarant shall make declaration, calculate the payable tax amount for the actually paid copyright fee or licensing fee in an additional declaration after customs clearance and fully pay the tax amount 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, and shall:

b.2.1/ Request the customs declarant to make additional declaration and handle violations under regulations, if the customs declarant fails to declare a copyright fee or licensing fee according to Point b.1 of this Clause. If the customs declarant fails to make additional declaration within 5 working days after receiving a written request for additional declaration, the customs office shall determine the customs value, assess the tax amount, fully collect the tax amount and/or late-payment interest, and handle violations according to regulations;

b.2.2/ Impose a sanction according to regulations, if the customs declarant makes declaration 5 days past the date of actual payment of the copyright fee or licensing fee according to Point b.1 of this Clause;

b.2.3/ Accept the declared value, if the customs declarant declares and determines the customs value according to 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 it is impossible to separate the copyright fee and licensing fee related to the imported goods, the customs value shall be determined not according to the transaction value-based method but according to the next method instead.”

9. To amend Point b of Clause 2, Clauses 5 and 9 of, and add Clause 11 to, Article 17 as follows:

“2. For imported goods that are used in Vietnam for purposes other than those for which they used to be regarded as non-taxable goods or goods eligible for tax exemption:

b/ Other imported goods:

b.1/ In case the purpose of the goods is changed for destruction, customs value must be the declared value;

b.2/ In case the purpose of the goods is changed for sale, customs value must be the declared value determined based on the actual payment. If the customs office has grounds to believe that the declared value is unconformable, the customs value shall be determined according to the method of customs valuation specified in this Circular and based on the current goods status;

b.3/ Apart from the cases mentioned at Points b.1 and b.2 of this Clause, customs value must be the declared value. If the customs office has grounds to believe that the declared value is unconformable, the customs value shall be determined according to the method of customs valuation specified in this Circular and based on the current goods status.

5. For goods that are imported without purchase or sale contract or commercial invoice; and imported goods that are transported into Vietnam via postal or express mail services without purchase or sale contract or commercial invoice, customs value must be the declared value. If the customs office has grounds to believe that the declared value is unconformable, the customs value shall be determined according to the method of customs valuation specified in this Circular and based on the current imported goods status.

9. For rented imported goods, the customs value must be the declared value determined based on actual payment or future payment for the rent and other expenses paid by the renter for the goods to be taken to the first border gate of importation as stated in the documents relating to the rented goods.

For borrowed imported goods, the customs value must be the total expenses paid by the borrower for the goods to be taken to the first border gate of importation as stated in the documents relating to the borrowed goods.

If the customs office has grounds to believe that the declared value is unconformable, the customs value shall be determined according to the method of customs valuation specified in this Circular and based on the current imported goods status.

11. For imported goods that are not yet used in Vietnam but are expected to be used for purposes other than those for which they used to be regarded as non-taxable goods or goods eligible for tax exemption:

a/ In case the purpose of the goods is changed for destruction, the customs value must be the declared value;

b/ In case the purpose of the goods is changed for sale, the customs value must be the declared value determined based on the actual payment. If the customs office has grounds to believe that the declared value is unconformable, the customs value shall be determined according to the method of customs valuation specified in this Circular and based on the current goods status;

c/ Apart from the cases mentioned at Points a and b of this Clause, customs value must be the declared value at the time of importation. If the customs office has grounds to believe that the declared value is unconformable, the customs value shall be determined according to the method of customs valuation specified in this Circular and based on the current goods status.”

10. To amend and supplement Article 21 as follows:

“Article 21. Customs value database

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

a/ Customs value database management system;

b/ List of exported and imported goods facing risks in value enclosed with reference prices;

c/ List of enterprises facing risks in customs value.

2. Information sources forming the customs value database:

a/ Information from customs dossiers, including available information in the electronic system or in the customs dossiers (for paper customs declaration) declared by customs declarants or collected by customs offices when carrying out customs procedures and after customs clearance;

b/ Information from the List of exported and imported goods facing risks in value; and List of enterprises facing risks in customs value as prescribed in this Circular;

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

d/ Other sources of information, including information collected by customs offices or provided by other relevant agencies with their reliability verified.

3. The customs value database shall be used for:

a/ Making the List of exported and imported goods facing risks in value; and the List of enterprises facing risks in customs value; 

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

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

4. The General Director of Customs shall issue detailed regulations on exploitation, development, management, operation and use of the customs value database.”

11. To amend and supplement Article 22 as follows:

“Article 22. Competence to make and modify; and principles of use of, the List of exported and imported goods facing risks in value and reference prices, and the List of enterprises facing risks in customs value

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

a/ The List of exported and imported goods facing risks in value made based on the criteria prescribed in Article 24 of this Circular. Such list must include the information about headings, names and detailed description of goods, units of calculation, origin of goods and reference prices;

b/ The reference prices of the goods items in the List of exported and imported goods facing risks in value which are set based on the sources of information specified in Article 25 of this Circular;

c/ The List of enterprises facing risks in customs value which is made on the basis of the results of risk assessment according to risk management principles. Such list must include the information about identification numbers and names of enterprises and places of registration of customs declarations.

2. Principles of use:

a/ The List of exported and imported goods facing risks in value and the List of enterprises facing risks in customs value shall be used as a basis for determining entities subject to customs value inspection during the performance of customs procedures or after customs clearance;

b/ The reference prices of the goods items in the List of exported and imported goods facing risks in value shall be used as the basis for the customs offices 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 customs sector.”

12. To amend and supplement Article 23 as follows:

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

1. The List of exported and imported goods facing risks in value and enclosed reference prices, and the List of enterprises facing risks in customs value 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 as prescribed in Clause 2 of this Article.

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

a/ Update the results of documentary examination and physical inspection of goods, consultations and valuation, results of post-customs clearance inspection, and anti-smuggling investigation, information on handling of violations, information on enterprise dossiers, results of assessment of law observance, and results of classification of risk levels to the corresponding database;

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

b.1/ Add reference prices for exported and imported goods which are on the List of exported and imported goods facing risks in value but not enclosed with reference prices according to the Report proposing additions to the List of exported and imported goods facing risks in value (made according to Form No. 02/DMBX/2015 provided 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 see an increase or a decrease of over 10% in comparison with the reference prices in the List of exported and imported goods facing risks in value according to the Report proposing additions to the List of exported and imported goods facing risks in value (made according to Form No. 03/DMSD/2015 provided 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 risks in value the exported and imported goods satisfying any of the criteria specified in Clauses 1 and 2, Article 24 of this Circular and reference prices that have not been included in such List according to the Report proposing additions to the List of exported and imported goods facing risks in value by collecting the information according to Article 25 (except Point h, Clause 1) of this Circular.

b.4/ Modify and add to the List of enterprises facing risks in customs value the enterprises satisfying the criteria specified in Clause 3, Article 24 of this Circular.

3. The units of the General Department of Customs shall update to the corresponding database of the General Department of Customs, based on 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 provincial-level Customs Departments to update the information and make the Report proposing additions to the List of exported and imported goods facing risks in value enclosed with reference prices, and the List of enterprises facing risks in customs value according to Clause 2 of this Article.”

13. To amend and supplement the title and Clause 3 of Article 24 as follows:

“Article 24. Criteria for making and modifying the List of exported and imported goods facing risks in value, and the List of enterprises facing risks in customs value

3. An enterprise shall be considered facing risks in customs value if:

a/ It is assessed by a customs office as failing to observe law at the time of assessment;

b/ It is classified by a customs office as an enterprise with high risks or an enterprise with very high risks or an enterprise having carried out import and export activities for less than 365 days;

c/ It is handled by a customs office for the untruthful declaration of customs value leading to a decrease in the payable tax amount or an increase in the tax amount eligible for exemption, reduction, refund or non-collection with the sanctioning level and fine as prescribed in the Ministry of Finance’s Circular on risk management in customs operations; or handled by a state management agency for tax fraud or tax evasion, within 730 days (2 years) prior to the date of assessment.”

14. To amend and supplement appendices as follows:

a/ To replace Appendix I to Circular No. 39/2015/TT-BTC with Appendix I to this Circular;

b/ To add Form No. 04/TGHQ to Appendix II to Circular No. 39/2015/TT-BTC.

Article 2.Responsibility for organization of implementation

1. The General Director of Customs shall, based on this Circular, guide customs units in uniformly implementing this Circular, thus facilitating import and export activities and effective customs management.

2. Customs offices, customs declarants, taxpayers and related organizations and individuals shall determine customs value as prescribed in this Circular. Any problems arising in the course of implementation of this Circular should be promptly reported to the Ministry of Finance (the General Department of Customs) for consideration and guidance for settlement.

Article 3.Effect

1. This Circular takes effect on October 15, 2019.

2. To annul Clause 15, Article 1 of the Minister of Finance’s Circular No. 39/2018/TT-BTC of April 20, 2018.

3. In case the documents referred to in this Circular are amended, supplemented or replaced, the amending, supplementing or replacing ones shall prevail.-

For the Minister of Finance
Deputy Minister
VU THI MAI

* The appendices to this Circular are not translated.