Decree No. 14/2018/ND-CP dated January 23, 2018 of the Government on prescribing in detail border trade activities

DECREE

Prescribing in detail border trade activities[1]

Pursuant to the June 19, 2015 Law on Organization of the Government;

Pursuant to the June 12, 2017 Law on Foreign Trade Management;

At the proposal of the Minister of Industry and Trade;

The Government promulgates the Decree prescribing in detail border trade activities.

Chapter I

GENERAL PROVISIONS

Article 1.Scope of regulation

1. This Decree prescribes in detail border trade activities prescribed in Articles 53 and 54 of the Law on Foreign Trade Management regarding goods trading and exchange by border traders and inhabitants; and goods trading and exchange and related activities prescribed in treaties between the Socialist Republic of Vietnam and bordering countries.

2. Temporary import for re-export, temporary export for re-import, border-gate transfer and transit are not regulated by this Decree.

Article 2.Subjects of application

1. Traders, organizations and individuals involved in border trade activities.

2. Agencies and organizations managing and administering border trade activities.

3. Other agencies, organizations and individuals involved in border trade activities.

Article 3.Interpretation of terms

In this Decree, the terms below are construed as follows:

1. Bordering country means a country which shares land borders with the Socialist Republic of Vietnam. Vietnam’s bordering countries include the People’s Republic of China, the Lao People’s Democratic Republic and the Kingdom of Cambodia.

2. Other border gates and border crossings for cross-border movement means secondary border gates and border crossings defined by the law on management of land border gates.

3. Border inhabitants regulated by this Decree include:

a/ Vietnamese citizens with permanent residence registration in communes, wards, townships or equivalent administrative areas having partial administrative boundaries coinciding with the national land borderline;

b/ Persons with border region residence permits granted by a competent public security agency.

4. Border markets include border markets or market areas or points, border-gate markets and markets in border-gate economic zones located in communes, wards, townships or equivalent administrative areas with partial administrative boundaries coinciding with the national land borderline where goods export, import, trading and exchange by border traders and inhabitants simultaneously take place.

5. Cross-border goods trading and exchange by traders are export and import activities under law.

Article 4.Payment in border trade activities

1. Payment for border trade activities may be made in freely convertible foreign currencies, Vietnam dong or currencies of bordering countries.

2. Methods of payment

a/ Payment via bank;

b/ Payment in cash;

c/ Clearing between exported goods and services and imported ones (with the difference paid via bank).

Chapter II

BORDER TRADE OF TRADERS

Article 5.Traders involved in cross-border goods trading and exchange

1. Traders entitled to carry out cross-border goods trading and exchange are Vietnamese traders, including enterprises, cooperatives, business households and individuals having business registration under law.

2. Traders having foreign direct investment capital, foreign companies and their branches in Vietnam are entitled to carry out cross-border goods trading and exchange under commitments in treaties to which the Socialist Republic of Vietnam is a contracting party,

Article 6.Border gates via which traders are allowed to carry out cross-border goods trading and exchange activities

1. Border gates via which traders are allowed to carry out cross-border goods trading and exchange activities must comply with Clause 1, Article 54 of the Law on Foreign Trade Management.

2. In case cross-border goods trading and exchange activities are carried out via secondary border gates or border crossings, the People’s Committees of bordering provinces shall decide and announce the lists of secondary border gates and border crossings allowed for goods trading and exchange activities after consulting related ministries and sectors to ensure adequate forces for specialized inspection and control as well as technical infrastructure facilities to serve state management.

3. The Ministry of Industry and Trade shall assume the prime responsibility for, and coordinate with related agencies in, proposing the Prime Minister to consider and permit goods trading and exchange activities to be carried out via locations other than secondary border gates and border crossings prescribed in Clauses 1 and 2 of this Article. On the basis of the Prime Minister’s permission, the People’s Committees of bordering provinces shall reach agreement with related ministries and sectors on ensuring adequate forces for specialized inspection and control and technical infrastructure facilities to serve state management.

Article 7.Goods in cross-border trading and exchange by traders

1. Goods in cross-border trading and exchange by traders must comply with the Law on Foreign Trade Management and documents guiding in detail international goods trading.

2. The Ministry of Industry and Trade shall assume the prime responsibility for, and coordinate with related ministries and agencies as well as the People’s Committees of bordering provinces in, promulgating the list of goods allowed for trading and exchange via secondary border gates and border crossings by traders in each period.

Article 8.Quarantine, food safety inspection and quality inspection of goods in cross-border trading and exchange by traders

Traders’ goods traded or exchanged across borders must comply with provisions of law and treaties on health quarantine; animal and plant quarantine and aquatic product quarantine; goods quality inspection; and food safety inspection.

Article 9.Forms of agreement in cross-border goods trading and exchange activities of traders

1. Cross-border goods trading and exchange activities of traders shall be carried out on the basis of agreement between Vietnamese traders and traders or individuals of bordering countries in one of the following forms:

a/ Written contract;

b/ In case written contracts are not established, traders shall make the lists of goods traded or exchanged across the border. Vietnamese traders shall sign and stamp their seal on the lists and take responsibility before law for the truthfulness of the lists, which have the same legal validity as contracts.

2. The lists of goods traded and exchanged across the border prescribed at Point b, Clause 1 of this Article shall be made according to the form provided in the Appendix to this Decree.

Article 10.Policies on taxes, charges and fees

1. Traders conducting cross-border goods trading and exchange shall fulfill their obligations on taxes, charges and fees as prescribed by law.

2. Goods traded and exchanged across the border are entitled to incentives prescribed by law and treaties of which the Socialist Republic of Vietnam is a contracting party.

3. Goods exported in the form of cross-border trading or exchange by traders as prescribed in this Decree are entitled to value-added tax refund under law.

4. Taxes, charges and fees in cross-border goods trading and exchange activities of traders must comply with law.

Chapter III

GOODS TRADING AND EXCHANGE ACTIVITIES OF BORDER INHABITANTS

Article 11.Border gates via which border inhabitants are allowed to carry out goods trading and exchange activities

Border inhabitants may carry out goods trading and exchange activities via border gates and border crossings defined in Article 6 of this Decree.

Article 12.Goods traded or exchanged by border inhabitants

1. Goods of border inhabitants are those manufactured in Vietnam or bordering countries which are traded or exchanged by border inhabitants in border areas of two countries to meet their production or consumption demands.

2. The Ministry of Industry and Trade shall promulgate the list of goods traded or exchanged by border inhabitants as prescribed in Clause 1 of this Article.

Article 13.Taxes on goods traded or exchanged by border inhabitants

1. Border inhabitants who trade in and exchange goods on the list of goods traded and exchanged by border inhabitants promulgated by the Ministry of Industry and Trade prescribed in Clause 2, Article 12 of this Decree are entitled to duty-free allowances prescribed in Appendix V to the Government’s Decree No. 134/2016/ND-CP of September 1, 2016, detailing a number of articles and prescribing measures for implementation of the Law on Import Duty and Export Duty.

2. The value of goods in excess of the allowances referred to in Clause 1 of this Article is subject to import duty and other taxes and charges (if any) prescribed by law.

Article 14.Management of purchase of traded and exchanged goods of border inhabitants

1. If border inhabitants do not use the goods within the allowances referred to in Clause 1, Article 13 of this Decree for production or consumption, they shall pay taxes thereon under law.

2. Traders may purchase the goods referred to in Clause 1 of this Article at border markets but shall make lists of purchased goods.

3. Traded and exchanged goods of border inhabitants referred to in Clause 1 of this Article, when purchased, are subject to quarantine and inspection of food safety and quality inspection under Article 8 of this Decree.

4. The Ministry of Finance shall guide the collection of taxes on goods within allowances which are not used for production or consumption by border inhabitants as prescribed in Clause 1 of this Article.

Article 15.Quarantine and inspection of goods quality and food safety in goods trading and exchange activities of border inhabitants

1. Traded and exchanged goods of border inhabitants are not subject to health quarantine, except when competent state agencies notify the outbreak or danger of contagious epidemics.

2. Goods subject to animal or plant quarantine or aquatic product quarantine as announced by competent state agencies in each period shall be quarantined under law.

3. Traded and exchanged goods of border inhabitants are not subject to food quality and safety inspection and control, except the cases specified in Clause 3, Article 14 of this Decree,

Chapter IV

BORDER MARKETS

Article 16.Subjects conducting goods trading and exchange at border markets

1. Traders and individuals bearing Vietnamese citizenship and having permanent residence registration in border regions or border residence permits issued by competent public security agencies.

2. Traders and individuals bearing citizenships of bordering countries and having one of the following valid papers: passport, border identity card, citizen identity card (applicable to inhabitants living along the Vietnam-Laos or Vietnam-Cambodia land borderlines), border passes or other valid entry and exit papers issued under the laws of bordering countries; and traders, business households and individuals with business registration certificates granted under the laws of bordering countries.

3. Traders, business households and individuals with business registration certificates of bordering countries may only trade and exchange goods at border markets and shall comply with Vietnam’s law.

Article 17.Business activities at border markets

Business activities at border markets must comply with:

1. The Government’s Decree No. 02/2003/ND-CP of January 14, 2003, on market development and management; Decree No. 114/2009/ND-CP of December 23, 2009, amending and supplementing a number of articles of Decree No. 02/2003/ND-CP of January 14, 2003, on market development and management, and other relevant legal documents.

2. Treaties between the Socialist Republic of Vietnam and bordering countries.

Article 18.Goods traded or exchanged at border markets

1. Goods traded or exchanged at border markets must be those allowed for circulation in the Vietnamese market under law.

2. Goods traded or exchanged across borders for trading at border markets must comply with the provisions of this Decree.

Article 19.Quarantine applicable to goods traded and exchanged at border markets

1. Goods traded and exchanged at border markets are subject to health quarantine and animal, plant and aquatic product quarantine under the laws on health quarantine and animal, plant and aquatic product quarantine.

2. Goods traded and exchanged at border markets are subject to food quality and safety inspection and control.

3. Goods imported from bordering countries and introduced in border markets shall be quarantined by border-gate quarantine offices in the places where the goods are imported. Goods exported from border markets to bordering countries shall be quarantined under law.

Article 20.Provisions on taxes, charges and fees for goods traded or exchanged at border markets

Traders, organizations, business households and individuals with business registration certificates to do business at border markets shall comply with Vietnam’s laws on value-added tax, enterprise income tax, excise tax, license fee and other taxes and charges (if any).

Chapter V

ENTRY AND EXIT OF PEOPLE AND VEHICLES IN BORDER TRADE ACTIVITIES

Article 21.Entry and exit of Vietnamese people and vehicles

1. Goods owners or persons authorized by goods owners, vehicle owners, cargo transport vehicle drivers and workers on board vehicles or vessels must possess one of the following valid papers: passport, people’s identify card, citizen identity card (applicable to inhabitants living along the Vietnam-Laos and Vietnam-Cambodia land borderlines), border passes (seaman’s passports for vessels) or other papers for border crossing prescribed by Vietnamese law.

Particularly for vehicle drivers, in addition to the above papers, they must also have driver licenses suitable to the type of vehicle.

2. Vehicle owners and cargo transport vehicle drivers, when entering border regions, shall produce or submit papers as required by current law.

3. Vietnamese vehicles, cargo transport vehicle drivers and businesspeople may travel through border gates and border crossings defined in this Decree into or out of border markets of bordering countries and shall comply with the inspection and control by specialized management forces at these border gates and border crossings; when moving deep into the mainland of a bordering country, they shall carry out immigration procedures for people and vehicles according to the laws of Vietnam and the bordering country.

4. The management of Vietnamese vehicles crossing the border for goods delivery or receipt right at border gate or border crossing areas then returning on the same day, and vehicles of individuals and organizations in border regions frequently crossing the border must comply with relevant law.

5. People and cargo transport vehicles referred to in this Article that need to go into goods transshipment locations determined in the transport agreements between the governments of Vietnam and bordering countries for goods delivery and receipt shall comply with the provisions of the agreements, protocols and other agreements concluded between the Socialist Republic of Vietnam and these bordering countries regarding immigration and goods transportation.

Article 22.Entry and exit of people and vehicles of bordering countries

1. Citizens of bordering countries who are goods owners or persons authorized by goods owners, vehicle owners, vehicle operators and workers on board cargo transport vehicles of bordering countries may travel with cargo transport vehicles through border gates or border crossings defined in this Decree into goods delivery and receipt locations with passports, seaman’s passports or people’s identity cards (applicable to inhabitants living along the Vietnam-Laos or Vietnam-Cambodia land borderline) or border passes issued by competent bodies of bordering countries or other papers for border crossing under current Vietnam’s law.

2. Cargo transport vehicles of bordering countries may travel through border gates determined by this Decree into goods delivery and receipt locations determined by competent Vietnamese agencies in border regions.

3. Vehicles and citizens who are cargo transport vehicle drivers and businesspeople of bordering countries, when going into or out of border markets, border-gate markets and markets in border economic zones of Vietnam for goods transportation, shall comply with the inspection, control and quarantine by specialized state management bodies at the border gates; when they need to travel from border markets into the Vietnam’s inland, they shall carry out exit and entry procedures for people and vehicles under current Vietnam’s law.

4. Vehicles of bordering countries which travel into border-gate or border-crossing areas of Vietnam for goods delivery and receipt then return to their countries on the same day and vehicles of individuals and organizations in border regions which frequently travel through border regions everyday are not required to make customs declarations and submit their vehicles’ papers but shall comply with the inspection, control and quarantine by specialized state management agencies at the border gates.

5. The management of vehicles of bordering countries which travel into the border-gate or border-crossing areas of Vietnam for goods delivery and receipt right at the border-gate areas then return on the same day and vehicles of individuals and organizations in border regions which frequently travel through the borders must comply with Vietnam’s law.

6. In case people and vehicles of a bordering country need to travel into locations other than border-gate or border-crossing areas for goods delivery and receipt, they shall comply with the agreements, protocols and other agreements concluded between the Socialist Republic of Vietnam and the bordering country regarding immigration and goods transportation.

Chapter VI

ORGANIZATION OF IMPLEMENTATION AND EFFECT

Article 23.Responsibilities of the Ministry of Industry and Trade

1. To assume the prime responsibility for, and coordinate with related ministries, sectors and the People’s Committees of border provinces in, guiding the implementation of this Decree.

2. To assume the prime responsibility for, and coordinate with related ministries and sectors in, advising the Government and the Prime Minister on management and administration of border trade activities.

3. To coordinate with related ministries, sectors and People’s Committees of border provinces in directing, administering and guiding border trade activities according to their assigned functions and tasks.

4. To assume the prime responsibility for, and coordinate with related ministries, sectors and the People’s Committees of border provinces in, providing the implementation of border trade activities for secondary border gates and border crossings.

5. To assume the prime responsibility for, and coordinate with related ministries, sectors and the People’s Committees of border provinces in, regulating cross-border goods trading and exchange activities of traders upon occurrence or possible occurrence of goods congestions at border gates or border crossings in the border provinces, environmental pollution, natural disasters, epidemics and in other necessary cases.

6. To cooperate, exchange ideas and reach agreement with competent authorities of bordering countries on coordination mechanisms in management of border trade activities.

7. To periodically or extraordinarily review and report on border trade activities to competent authorities.

Article 24.Responsibilities of related ministries and sectors

1. The Ministry of National Defense shall assume the prime responsibility for, and coordinate with related ministries, sectors and the People’s Committees of border provinces in, performing the state management at border gates within the ambit of their assigned functions and tasks under law.

2. The Ministry of Finance shall assume the prime responsibility for, and coordinate with related ministries, sectors and the People’s Committees of border provinces in, guiding the implementation of tax, charge and fee policies and customs procedures applicable to exports and imports; and coordinate with the Ministry of National Defense in the entry and exit of vehicles in border trade activities.

3. The Ministry of Health shall assume the prime responsibility for, and coordinate with related ministries, sectors and the People’s Committees of border provinces in, managing and guiding border health quarantine and food safety inspection activities in accordance with the law on food safety in border trade activities.

4. The Ministry of Agriculture and Rural Development shall assume the prime responsibility for, and coordinate with related ministries, sectors and the People’s Committees of border provinces in, managing and guiding the implementation of animal and plant quarantine, aquatic product quarantine and food safety inspection in accordance with the law on food safety in border trade activities.

5. The Ministry of Science and Technology shall assume the prime responsibility for, and coordinate with related ministries, sectors and the People’s Committees of border provinces in, managing and guiding the implementation of goods quality inspection in border trade activities.

6. The Ministry of Transport shall assume the prime responsibility for, and coordinate with related ministries, sectors and provincial-level People’s Committees in, facilitating the development of transport infrastructure in service of border trade activities; and guide the implementation of treaties and relevant regulations on vehicles travelling across the border.

7. The State Bank of Vietnam shall assume the prime responsibility for, and coordinate with related ministries, sectors and People’s Committees of border provinces in, managing and guiding payments in border trade activities.

8. The Ministry of Public Security shall, according to its function and tasks, coordinate with related ministries, sectors and the People’s Committees of border provinces in managing residence in border regions; coordinate with related  ministries, sectors and the People’s Committees of border provinces in maintaining security, social order and safety in border regions, managing the entry and exit of people and vehicles in border trade activities; intensify cooperation with related authorities of other countries in preventing and fighting crime and violations in border trade activities.

9. Related ministries and sectors shall coordinate with the Ministry of Industry and Trade in unanimously guiding and directing the management and administration of border trade activities within the scope of their respective responsibilities.

Article 25.Responsibilities of the People’s Committees of border provinces

1. To organize the management and administration of trading activities at border gates in their respective provinces according to law and regulations of the Prime Minister in each period.

2. To abide by the direction and administration of the Ministry of Industry and Trade and related ministries and sectors on border trade activities.

3. To take the initiative in formulating mechanisms and policies to encourage traders of all economic sectors to invest in and develop trade supporting activities at border gates.

4. To direct their provincial departments, sectors and agencies to closely monitor border trade activities; to monthly or extraordinarily report on border trade activities in their respective provinces to the Ministry of Industry and Trade.

5. To promulgate lists of secondary border gates and border crossings as prescribed in Clause 2, Article 6 of this Decree.

6. To apply measures to deal with goods congestions in their respective provinces as prescribed in Clause 2, Article 54 of the Law on Foreign Trade Management.

Article 26.Effect

1. This Decree takes effect on January 23, 2018.

2. To annul the Prime Minister’s Decision No.52/2001/QD-TTg of October 20, 2015, on the management of border trade activities with bordering countries.

3. Documents on secondary border gates and border crossings for border trade activities promulgated by the People’s Committees of border provinces according to Decision No. 52/2015/QD-TTg and circulars promulgated according to Decision No. 52/2015/QD-TTg before this Decree takes effect remain valid until their expiry dates.

4. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, and chairpersons of provincial-level People’s Committees shall implement this Decree.-

On behalf of the Government
Prime Minister
NGUYEN XUAN PHUC

* The Appendix to this Decree is not translated.