Resolution No. 119/NQ-CP 2019 measures to intensify the state management of prevention of origin fraud

I. OBJECTIVES

- To prevent goods origin fraud and illegal goods transshipment in import and export activities; to proactively detect and strictly handle violations, if any;

- To promote the development of domestic production, protect the legitimate rights and interests of Vietnamese producers; to maintain export growth in a sustainable manner; to attract foreign cooperation and investment in hi-tech projects with high added value and spillover effects, while connecting global production and supply chains;

- To improve the efficiency of international economic integration, especially the implementation of new-generation FTAs, ensuring the strict and effective implementation of commitments within the signed multilateral frameworks and under the signed FTAs;

- To protect Vietnam's rights and interests in international trade.

2. Specific targets

- To improve the legal system on goods origin and inspection and verification of goods origin to effectively prevent and strictly handle origin frauds, illegal goods transshipment, and shirking of trade remedies;

- To increase the capacity of the supervision and inspection apparatuses to effectively implement measures to prevent origin fraud, illegal goods transshipment, and shirking of trade remedies;

- To take the initiative in inspection, investigation and verification activities to detect violations, origin fraud, illegal goods transshipment, and shirking of trade remedies, and strictly handle the detected violations;

- To intensify communication and education activities to prevent origin fraud and illegal goods transshipment in import and export activities;

- To promote international cooperation to coordinate in preventing and handling cases of goods origin fraud and illegal goods transshipment in import and export activities.

II. MAJOR TASKS AND SOLUTIONS

1. The Ministry of Industry and Trade

a/ To assume the prime responsibility for, and coordinate with related ministries and agencies in, reviewing and improving the system of legal documents

- Amending or replacing Decree No. 124/2015/ND-CP of November 19, 2015, amending Decree No. 185/2013/ND-CP, on sanctioning of administrative violations in commercial activities, production and trading in counterfeit goods and banned goods and protection of consumer interests through increasing sanctioning levels for acts related to origin frauds or counterfeit goods labels in order to increase deterrence;

b/ To continue to assume the prime responsibility for, and coordinate with related ministries and agencies in, implementing the Prime Minister's Decision No. 824/QD-TTg of July 4, 2019, approving the Scheme to intensify the state management of prevention of the shirking of trade remedies and origin fraud. To monitor, compile statistics, regularly update and timely provide the list of commodity items subject to investigation, imposition of anti-dumping duty and countervailing duty by countries regularly applying trade remedies, and the list of commodity items at risk of origin fraud or illegal transshipment to the Ministry of Finance and related ministries, sectors and organizations, and provincial-level People's Committees to intensify control, examination and inspection, especially the issuance of certificates of origin (C/O) and supervision of investment, production, and import and export activities.

c/ To accelerate the implementation of policies to promote development of, and attract investment in, supporting industries in order to increase the localization rate in product structure for meeting the criteria on domestic value content and regional value content, with a view to increasing C/O-related preference utilization rate, take advantage of FTAs' tax incentives, and minimize foreign countries' investigation of origin fraud and shirking of trade remedies.

d/ To set a roadmap appropriate to a mechanism of self-certification of origin and issuance of C/Os via the internet in the direction of creating favorable conditions for the exporting enterprises in accordance with Vietnam's law as well as practical conditions.

dd/ The Ministry of Industry and Trade and Ministry of Finance shall consider signing a memorandum on coordination in information exchange serving the control of origin, and giving warnings about and assessing exports at risk of being subject to imposition, and prevention of the shirking, of trade remedies as well as imports at risk of being subject to investigation for application, and prevention of the shirking, of trade remedies.

e/ To promote international cooperation, especially the signing of memorandums of understanding and cooperation agreements with related foreign authorities to improve the effectiveness of activities related to the handling of the shirking of trade remedies and origin fraud.

g/ To consolidate the organization and increase capacity of C/O issuers, including the re-planning of the system of C/O issuers and intensifying inspection and verification of goods origin, ensuring the modern and effective operation of the system.

h/ To intensify inspection, examination and supervision of C/O issuers under current regulations to ensure strict compliance with regulations on goods origin.

- Regularly inspecting and supervising issuers of C/Os (including preferential C/Os and non-preferential C/Os) to ensure strict compliance with regulations on goods origin;

- Increasing coordination among C/O issuers in information exchange; intensifying professional guidance for officers engaged in C/O issuance, upgrading physical facilities, storing dossiers and documents, etc., to facilitate the verification of origin upon request;

- Regularly supervising and updating information and data on C/O issuance to detect abnormal developments;

- Continuing to widely apply the channeling mechanism for receiving dossiers and issuing C/Os, and regularly updating the list of high-risk enterprises and commodities to put them under red channel. Identifying exports with signs of abnormal large turnovers in order to request inspection and verification of origin;

- Intensifying the mechanism for risk management, dossier examination and verification at enterprises in suspected cases or for high-risk commodities;

- Intensifying the monitoring and supervision of enterprises applying the mechanism of self-certification of origin to prevent them from taking advantage of this mechanism to commit origin frauds;

- Establishing origin-related interdisciplinary inspection teams with regard to enterprises showing suspected signs of origin fraud or counterfeiting, or illegal goods labeling or transshipment. An inspection team must consist of representatives of the Ministry of Industry and Trade, Ministry of Finance, Ministry of Public Security, Vietnam Chamber of Commerce and Industry and the related line associations. Conducting inspection and examination of the issuance of C/Os;

- Contents related to the checking and verification of the origin of exports before and after the issuance of C/Os and the self-certification of origin of exports by traders must comply with Circular No. 39/2018/TT-BCT of October 30, 2018, prescribing the checking and verification of origin of goods.

i/ To formulate and submit to the Prime Minister for approval the Scheme on building and effective operation of the early warning system concerning trade remedies-related lawsuits in December 2019 to serve as a basis for analyzing and updating information on exports at risk of being subject to foreign countries' investigation regarding trade remedies and origin fraud as well as preventing dumping of, or subsidy or origin fraud for imports which may cause damage to domestic production.

k/ Coordination mechanism

- To develop a mechanism for close and effective coordination among ministries, sectors, the Vietnam Chamber of Commerce and Industry and business associations and line associations in order to regularly remove difficulties for enterprises, and create favorable conditions for enterprises in strictly observing the law on goods origin. To provide information on productivity and production capacity of line associations, and information on suspicion about C/O fraud and C/O fraud tricks for competent agencies to strengthen management work;

- To coordinate with ministries, sectors, localities, business associations, line associations and related organizations in intensifying training, information and communication on prevention of origin fraud and illegal goods transshipment.

l/ To set up a hotline to receive information on origin fraud.

m/ To closely coordinate with ministries, sectors, provincial-level People's Committees and C/O issuers in localities in monitoring and physically inspecting production processes of exports-producing enterprises, mastering production activities and sources of raw materials used by enterprises to ensure that exported products meet origin criteria.

a/ To coordinate with ministries and sectors in revising provisions on handling of violations related to the origin of exports and imports of Decree No. 45/2016/ND- CP of May 26, 2016, amending and supplementing the Government's Decree No. 127/2013/ND-CP of October 15, 2013, on sanctioning of administrative violations and enforcement of administrative decisions in the field of customs.

b/ To direct the General Department of Customs to implement the following contents:

- Monitoring data on import and export of goods, especially those on the list of goods or commodities for which Vietnam in conducting investigation for application of trade remedies so as to monthly provide such information to the Ministry of Industry and Trade and Ministry of Public Security, paying special attention to abnormal changes in import and export turnovers;

- Tightening the checking of origin from the stage of receiving dossiers to the stage of post-clearance inspection. Establishing an operations network to check and verify the origin of exports and imports.

a/ To intensify the inspection and examination of the labeling of goods sold in the domestic market to promptly detect acts of goods labeling in contravention of regulations.

b/ To coordinate with related ministries and sectors in studying, amending and supplementing Decree No. 43/2017/ND-CP on goods labeling, and Decree No. 119/2017/ND-CP of November 1, 2017, on sanctioning of administrative violations in the field of standards, measurement and product and goods quality to promptly prevent Vietnamese origin frauds and counterfeits in goods labels.

c/ To review the scope of regulation and effect of Circular No. 05/2019/TT- BKHCN, guiding the implementation of the Government's Decree No. 43/2017/ND-CP of April 14, 2017, on goods labeling.

a/ To intensify the inspection and identification of the origin of goods and goods exported and transshipped from Vietnam to other countries in order to issue C/Os of goods under regulations.

b/ To tighten the management of the issuance of C/Os in accordance with Decree No. 31/2018/ND-CP of March 8, 2018, detailing the Law on Foreign Trade Management regarding goods origin.

c/ To monitor the market and closely follow the production and export activities of its member enterprises in order to promptly detect acts of goods origin fraud, coordinate in providing information on commodities and enterprises at risk of origin fraud or counterfeits, or illegal transshipment to related ministries (the Ministry of Industry and Trade, Ministry of Finance, etc.).

d/ To exchange data on issuance of C/Os with the Ministry of Industry and Trade under regulations. To develop a plan to connect the system of exchange of data on issuance of C/Os through the Vietnam National Single Window portal according to data standards guided by the Ministry of Industry and Trade.

dd/ To closely coordinate with ministries, sectors, provincial-level People's Committees and C/O issuers in localities in monitoring and physically inspecting production processes of exports-producing enterprises, mastering production activities and sources of raw materials used by enterprises to ensure that exported products meet origin criteria.

e/ To intensify the communication and dissemination activities and recommend business associations and line associations about the risk of being subject to imposition of penalties due to origin fraud; to encourage associations to detect and report acts of origin fraud; to protect real enterprises and brands of Vietnamese goods.

a/ To take the initiative in taking measures to collect, study and evaluate trade policies, trade remedies and protectionism measures of countries, especially the United States, EU and China, etc.; to study and review inadequacies in policies and laws falling within the ambit of the functions and tasks of the Ministry of Public Security regarding import and export of goods, prevention of the shirking of trade remedies and origin fraud to promptly propose the Government, ministries and sectors to amend, supplement and complete them in a uniform and synchronous manner meeting the requirements of the state management work, international integration and crime prevention and combat in the new situation.

b/ To closely coordinate with the Ministry of Industry and Trade, Ministry of Finance, and VCCI in strengthening the prevention of tax evasion, and timely inspecting and verifying commodities and cases with signs of origin fraud; to proactively detect, investigate, and strictly handle cases of violations related to the shirking of trade remedies and origin fraud in accordance with law.

c/ To direct specialized departments and local public security agencues to intensify supervision to promptly detect acts of origin fraud, investigate and handle violations in accordance with law; to intensify supervision of foreign direct and indirect investment in each related field and locality.

a/ To intensify the communication and guide local management agencies in considering and settling investment registration for foreign investors (including mergers and acquisitions), and closely supervise foreign investment projects in different fields and production and trading of commodities at risk of origin fraud, illegal transshipment or shirking of trade remedies.

b/ To coordinate in studying, analyzing and evaluating domestic production capacity compared to import-export data provided by the Ministry of Finance, and provide information on investment by enterprises regarding commodities at risk of origin fraud to the Ministry of Industry and Trade, VCCI and General Department of Customs to strictly control the issuance of C/Os and inspection of the origin of exports.