Decision No. 874/QD-TCHQ dated May 15, 2007 of the General Department of Customs on promulgation of customs procedures applicable to commercial imported, exported goods

DECISION

ON PROMULGATION OF CUSTOMS PROCEDURES APPLICABLE TO COMMERCIAL IMPORTED, EXPORTED GOODS

DIRECTOR OF GENERAL DEPARTMENT OF CUSTOMS

Pursuant to Customs Law No. 29/2001/QH10 dated June 29, 2001 and Law on amendment of and supplement to a number of articles of Customs Law 42/2005/QH11 dated June 14, 2005;

Pursuant to Decree No. 154/2005/ND-CP dated December 15, 2005 of the Prime Minister detailing the implementation of a number of articles of the Customs Law regarding the customs procedures, the custom inspection and supervision regime;

Pursuant to Circular No. 112/2005/TT-BTC dated December 15, 2005 of the Ministry of Finance providing the customs procedures, the customs inspection and supervision regime;

Pursuant to directive opinion of the heads of the Ministry of Finance dated May 8, 2006;

In consideration of opinions of the head of the Department of Customs Management Supervision, the head of the Department of Personnel Organization, the head of Department of Information Technology and Customs Statistics,

DECIDE:

Article 1. To promulgate together with this Decision the Regulations on customs procedures applicable to commercial imported, exported goods and enclosed forms, including:

- Professional request (form 01/PYCNV/2006);

- Form order, customs inspection level (having code and bar code for management purpose);

- Receipt note, customs record handover (form 02/PTN-BGHS/2006);

- General diagram of customs procedures applicable to commercial imported, exported goods.

Article 2. This Decision shall take effect as of June 1, 2006 and replace Decision No. 1951/2005/QD-TCHQ dated December 19, 2005 of the Director of General Department of Customs.

Article 3. Directors of customs departments at provinces and cities, heads of units under the General Department of Customs shall be responsible for implementing this Decision./.

CUSTOMS PROCEDURES APPLICABLE TO COMMERCIAL IMPORTED, EXPORTED GOODS
(issued together with Decision No. 874 /QD-TCHQ  dated May 15, 2006)

I. GERERAL PROVISIONS:

1. Full customs procedures for customs clearance of commercial imported, exported goods under this Decision include 5 fundamental steps set out in section II below.  Regarding each imported, exported batch of goods, depending on method and inspection level, the customs procedures may undergo all 5 steps or only certain steps.  With respect to exported goods of exporter who has been complying with regulations of law and the goods is exempted from the actual inspection pursuant to provisions of the Customs Law, the customs procedures shall be carried out according to a simplized procedures and preference regime.

The procedures shall regulate orders of main works which to be conducted. When implementing the procedures, customs officials shall check against and base on regulations on laws, decrees, circulars and guiding regulations issued by competent authority.

2. The classification of green, yellow, red streams and form order, level of customs inspection shall be implemented according to regulations of the Custom Law, Law on import, export tariff, implementation documents, information system determined by computers and other information available at the time of proceeding with customs procedures.

3. Form order, level of customs inspection shall be numbered automatically by the computer system, have bar code for inspection and management, printed 1 version to internally circulate and file with customs record.  The head of customs sub-department shall approve the form order, decide on three streams of application files: green, yellow, red and/or give opinion on each specified circumstance.

4. The circulation of the application file after the approval of the head of customs sub-department on form and level of customs inspection shall be carried out as the following:

4.1. For application file under green stream:

To return to official who proceeds with step 1 to certify and seal his official code to the square “customs procedures completed” on the customs declaration (square No. 26 on import, export goods declaration, form HQ2002XK or square No. 38 on import, export goods declaration, form HQ2002NK).

4.2. For application file under yellow stream:

To transfer the file to official who proceeds with step 2 for detail inspection, in particular:

- In case the result of the detail inspection is conformable to the statements of the declarer, the customs official who conducts the detail inspection shall certify and seal his official code to the square “custom procedures completed” on the customs declaration (square No. 26 on import, export goods declaration, form HQ2002XK or square No. 38 on import, export goods declaration, form HQ2002NK).

- In case the result of the detail inspection shows any difference, doubt, violation, the person in charge shall propose method to deal with and transfer the related file to the head of customs sub-department for conisderation and decision.  Then, the file shall be transferred to suitable steps for handling according to direction of the head of customs sub-department.

4.3. For application file under red stream:

To transfer the file to official who proceeds with step 2 for detail inspection before carrying out actual inspection of goods, in particular:

- In case the results of the detail inspection and actual inspection of goods are conformable to the statements of the declarer, the customs official who conducts the detail inspection shall confirm by a signature and seal his official code to the square “custom procedures completed” on the customs declaration (square No. 26 on import, export goods declaration, form HQ2002XK or square No. 38 on import, export goods declaration, form HQ2002NK).

- In case the results of the detail inspection and actual inspection of goods show any difference, doubt, violation, the person in charge shall propose method to deal with and transfer the related file to the head of customs sub-department for conisderation and decision.  Then, the file shall be transferred to suitable steps for handling according to direction of the head of customs sub-department.

5. The change in classification of streams, form and level of customs inspection shall be carried out from green to yellow or red, from less inspection percentage to more inspection percentage or wholly inspection; the change from red to yellow, green or wholly inspection to percentage inspection is prohibited, except the case of incorrect in determination by the computer as set out in Item 3.2, Step 1, Section II below.

Regarding cases having doubts which need to be adjusted the classification of stream or form, customs inspection level, but having direction from higher agency not to change and continue to follow in order to find other measure for dealing with, such direction shall be complied and shall  be filed together with the customs records.

6. The cerification of “customs procedures completed” on the customs declaration (goods customs clearance) shall be carried out by customs officials.  In case more than one customs official takes part in a step of the customs procedures, the customs official who conducts the last phase or customs official assiged or appointed by the head of customs sub-department shall make the certification.  In particular:

- For application file under green stream: the official at step 1 shall certify after having approval and decision of the head of customs sub-department on form and customs inspection level.

- For application file under yellow stream:  the official who inspects in detail the application file, price, tax shall certify after all works in step 2 are completed.

- For application file under red stream: the official who conducts the actual inspection shall certify after all works in step 3 are completed (if there are more than one official takes part in the inspection procedures, then all such officials shall certify and seal their official codes to the square where the result of actual inspection is stated, regarding to the cerification of “customs procedures completed” on the customs declaration, only one official assigneed or appointed by the head of customs sub-department is required to sign and seal).

7. Duties of the head of customs sub-department during the customs procedures:

7.1. Head of customs sub-department shall have duty proactively obtain information, consider and inspect to make decision or change form, insepction level prescribed in the form order, customs inspection level determined by the computer or proposed by the official taking part in customs procedures; sign and seal official code to this order;

7.2. To decide on the goods customs clearance with respect to cases which have not completed the customs precedures as set out in Clause 3, Article 12 Decree 154/ND-CP dated December 15, 2005 of the Government;

7.3. To decide on price consultation, decide to render expertise assessment of goods according to provisions set out in item III.1.2, section 1, part B of Circular 122/2005/TT-BTC;

7.4. To resolve problems arisen which beyond authority of customs officials during the customs procedures;

7.5. To deal with breaches which are under authority of the director of customs sub-department; to complete procedures and transfer files of violation cases which are under authority of the higher level agency;

7.6. Be respeonsible for implementation, inspection and supervision of works to be carried out by the officials during the implemantation of customs procedures; to ensure the compliance with regulation, the promptly procedures and non-inconvinience and tie-up.

8. The circulation of files among steps, divisions of the customs agencies shall be internal circulation, not to permit the declarer to carry out such circulation.

9. Regarding enterprises which qualify for issuance of a special preferntial card relating to customs procedures, a separate regulations will be applied.

II. SPECIFIC REGULATIONS:

Step 1: Receive application file, priminary examination, delaration registration, form decision and inspection level:

Works in this step shall include:

1. to input import, export code of the enterprise in order to check conditions for opening a declaraton of the enterprise on the system (compulsory or not) and check taxation grace period, taxation guarantee;

1.1. In case the enterprise does not qualify for registration of the declaration, the customs official shall give a professional request informing the applicant,clarifying the reason for the refusal of registration of declaration;

1.2. In case the enterprise qualify for registration of the declaration, the customs official shall carry out the priminary examination the customs application file (to be implemented according to item III, section I, Part B, Circular 112/2005/TT-BTC).  If the application file is duly, to input information of the declaration to the computer system:

a. If the appliction file is received by hand (paper application file), the customs official shall input to the computer information on the customs declaration, price value declaration and other related information (if any).  If the application file falls within green stream and taxable, the customs officer shall print a “voucher on payable tax” according to regulations of law.

b. If the aplication file is receipted by electronic means (software, internet etc.), the customs official shall update the data to the computer system and other related information (if any);

2. After inputting all information to the computer, the information shall be automatically processed (under a risk management system program) and the form order and inspection level shall be given.

Form order, inpection level includes certain specific criteries according to attached forms, there are three different levels (level 1, 2, 3 correlative with green, yellow, red).

- Level (1): to be excempted from detail inspection of application file and actual inspection of goods (green stream);

- Level (2): the application file shall be inspected in detail, but actual inspection of goods is excempted (yellow stream);

- Level (3): the application file to be inspected in detail and the goods to be actual inspected (red stream).

Form order and inspection level which belong to inspection level (3) (red stream) shall include 3 actual inspection levels (to be implemented according to provisions of Circular 112/2005/TT-BTC) as the followings:

+ Level (3).a : to inspect wholly of the batch of goods;

+ Level (3).b: to actually inspect 10% of the batch of goods, if no violation is discovered, the inspection procedures shall be completed.  In case of discovery of any violation, to continue to inspect until a final conclusion on the seriousness of the violation is determined.

+ Level (3).c: to actually inspect 5% of the batch of goods, if no violation is discovered, the inspection procedures shall be completed.  In case of discovery of any violation, to continue to inspect until a final conclusion on the seriousness of the violation is determined.

3. Cases forms and inspection levels of which are proposed by officials:

3.1. Regarding customs sub-departments where the computers are not able to classify the streams automatically, officials who receive application files shall propose the forms and inspection levels (which are already printed out) base on criteria of classification of enterprises (enterprises comply well with the customs law, enterprises breach the customs law for many times), policy on each type of goods, and other information, etc. and transfer the application files together with form order and inspection level to the head of customs sub-department for consideration and decision.

3.2. Regarding cases where the computers are able to determine forms, inspection levels on the order but the customs officials believe that such determination is not correct due to the insufficiency of information (in particular, information on policy on goods, goods are entitled to preferential customs procedures) in the computers or the computers cannot deal with information timely, the customs officials shall propose other forms and inspection levels by the way of writing in the respective square on the form order, inspection level and write down reason of adjustment and transfer the application file together with form order and inspection level to the head of customs sub-department for consideration and decision.

4. After the procedures of receive, primary examination of the application file and declaration registration are completed, official at step 1 shall print form order, inspection level, sign name and seal official code to square preserved for official step 1 on the order form, inspection level and square “registration officer” on the customs declaration.

5. To transfer all application file together with form order, inspection level to the head of customs sub-department for consideration and decision of the form, inspection level and directions for next steps (if any);

6. the head of customs sub-departments to decide forms, inspection levels.  After the decision on forms and inspection levels by the head of customs sub-department, the application files are circulated as the followings:

6.1. For application under green stream:

a. Head of customs sub-departments return to the official at step 1 for certifying and sealing the official code to square “customs procedures completed” on the customs declaration (square No. 26 on the import, export goods customs declaration, form HQ2002XK or square No. 38 on the import, export goods customs declaration, form HQ2002NK);

b. After signing and sealing in square “certification of customs procedures completed” on the custom declaration, the official at step 1 shall transfer the application file to customs fee collection division to seal “customs procedures completed” and return the customs declaration to the declarer.

6.2. For application file under yellow and red streams:

The head of the customs department to transfer the application file to official in step 2 for taking detail inspection on application file, price and tax.

Step 2: Detail inspection on application file, price and tax:

Works in this step shall include:

1. To inspect in detail the application file (to be implemented according to provisions in item III.1.2, section 1 part B, Circular 112/2005/TT-BTC);

2. To inspect taxable price, to examine code, policy and tax regime (to be implemented according to provisions in item III.3.5, section 1 part B, Circular 112/2005/TT-BTC) and to consult price (if any) according to inspection procedures and to determine taxable price applicable to imported, exported goods promulgated by the General Department of Customs;

3. If the detail inspection shows a conformity, to input the acceptance information to the computers and print “voucher on payable tax” according to regulations of the Ministry of Finance.

4. After the inspection work in step 2 above is completed, to record result of the detail inspection of application file to the form order, inspection level (spare preserved for the official in step 2) and record the result of inspection of tax decalration to the customs declaration (to square “tax inspection part”), to sign and seal official code to the form order, customs inspection level and the Customs declaration.  In case there are more than one customs officer takes part in the detail inspection of the application file, all such customs officers shall certify in the part on which the result of the inspection is written on the Customs Declaration and the form order, customs inspection level according to direction from the head of customs sub-department.  In particular as the followings:

4.1. For application file under yellow stream which has result on detai inspection is comformable to statements of the declarer:

a. to certify, seal the official code to the square “customs procedures completed” on the customs declaration (square No. 26 on the import, export goods declaration, form HQ2002XK or square 38 on the import, export goods declaration, form HQ2002NK). In case there are mote than one customs officer takes part in the inspection, the customs officer who conduct the last inspection or customs officer appointed or assigned by the head of customs sub-department shall certify to square “customs procedures completed” on the Customs declaration;

b. to transfer the application file to the customs fee collection division, seal “customs procedures completed” and return the declaration to the declarer.

4.2. For application file under red stream which has result on detail inspection is comformable to statements of the declarer and/or the result shows noticable issues, the customs officer shall write down to the form order, customs inspection level such issue and transfer to the official at step 3 for implementation.

4.3. If the result of the detail inspection on the application file (yellow or red) shows any difference, inconformity which needs adjustment, doubt or violation, the customs officer shall propose the measure for dealing with and transfer the application file to the head of customs sub-department for consideration and decision on:

- customs clearance or temporarily liberation goods; and/or

- re-examination or change actual inspection level on goods; and/or

- price consulting; and/or

- rendering expertise assessment of goods; and/or

- making a minutes on certification/minutes on administrative violation of customs regulations.

5. To implement procedures on tax exemption, tax deduction (if any) according to provisions in Circular No. 113/2005/TT-BTC dated December 15, 2005 of the Ministry of Finance and implementing regulations and guidance of the General Department of Customs.

Step 3: Actual inspection of goods

This step is conducted by the official who is assigned to carry out the actual inspection of goods. The actual inspection of goods shall be conducted by machinery and equipment such as flash machine, electronic scale etc. or physical inspection.  The record of the results of actual inspection must be obvious and sufficient of necessary information of the goods for ensuring the exact determination of the goods code, price and tax.

Works in this step shall include:

1. to receive written request from enterprises on adjustment of statements declared by the declarer before the actual inspection of goods, propose and submit to the head of customs sub-department for consideration and decision (if any).

2. to carry out the actual inspection of goods:

2.1. to inspect the status of packing and seal of goods;

2.2. to actually inspect the goods according to guidance stated in the form order, inspection level (the actual inspection is implemented according to guidelines in item III.2.2 and III.3, section 1, part B of Circular 112/2005/TT-BTC);

3. to record the result of the actual inspection to the customs declaration; the method of inspection, goods to be inspected, sufficient information to determine the code of the goods, taxable price and other relevant matters are required to be described in detail. To sign and seal the official code to the square “customs inspection result part” on the customs declaration (all official take part in the actual inspection procedures must sign and seal their official codes to this square).

4. Input the actual inspection result to the computer systems.

5. Dealing with inspection result:

5.1. If result of the actual inspection is conformable to statements of the declarer, the customs officer shall certify, seal the official code to the square “customs procedures completed” on the customs declaration. In case there are more than one customs officer takes part in the actual inspection of goods, only the official assigned or appointed by the head of customs sub-department is required to certify on the square “confirmation of customs procedures completed” on the customs declaration.

To transfer the application file to the customs fee collection division to seal “customs procedures completed” and return the declaration to the declarer.

5.2. If result of the actual inspection shows any difference from the statements of the declarer, the customs official shall propose the method for dealing with and transfer the application file to the head of customs sub-department for consideration and decision on:

- examination and re-calculation of the taxable amount and issuance of a decision to adjust the receivable tax; and/or

- making a minutes on certification/minutes on breach; and/or

- customs clearance or temporary liberation of the goods.

Step 4: Collection of customs fee, seal “customs procedures completed” and return of the declaration to declarer

Duties in this step shall include:

1. to check tax payment voucher, bank guarantee/guarantee of credit institutions for tax amounts payable for goods which have to pay tax immediately;

2. to collect customs fee;

3. to seal “customs procedures completed” (form No. 3 issued together with Decision 120/2001/QD-TCHQ dated November 23, 2001) at the right angle above the front of the custom declaration (to seal ovelap the sign of the declaration HQ/2002-NK or HQ/2002-XK);

4. to record to the monitor register and return the customs declaration to the declarer;

5. to hand over the application file to selection and response division according to the form of Receipt Note, Handover of the application file issued together with this procedures (form 02: PTN-BGHS/2006).

Step 5: Selection and Response of Application File

- to receive the application files from the customs fee collection division;

- to sellect and response the application file according to a procedures of file sellection and response which is promulgated by the General Department of Customs.

During the implementation, if any problems arises, these problems must be reported promptly to the General Department of Customs for consideration and adjustment for suitability./.