Circular No. 155/2016/TT-BTC dated October 20, 2016 of the Ministry of Finance detailing the Government’s Decree No. 127/2013/ND-CP of October 15, 2013, on the sanctioning of administrative violations and coerced execution of administrative decisions in the field of customs, and the Government’s Decree No. 45/2016/ND-CP of May 26, 2016, amending and supplementing a number of articles of Decree No. 127/2013/ND-CP

CIRCULAR

Detailing the Government’s Decree No. 127/2013/ND-CP of October 15, 2013, on the sanctioning of administrative violations and coerced execution of administrative decisions in the field of customs, and the Government’s Decree No. 45/2016/ND-CP of May 26, 2016, amending and supplementing a number of articles of Decree No. 127/2013/ND-CP[1]

Pursuant to June 19, 2015 Law No. 76/2015/QH13 on Organization of the Government;

Pursuant to June 20, 2012 Law No. 15/2012/QH13 on Handling of Administrative Violations;

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

Pursuant to November 29, 2006 Law No. 78/2006/QH11 on Tax Administration; November 20, 2012 Law No. 21/2012/QH13 Amending and Supplementing a Number of Articles of the Law on Tax Administration; and November 26, 2014 Law No. 71/2014/QH13 Amending and Supplementing a Number of Articles of the Laws on Taxes;

Pursuant to November 29, 2005 Law No. 51/2005/QH11 on E-Transactions;

Pursuant to the Government’s Decree No. 81/2013/ND-CP of July 19, 2013, detailing a number of articles of, and measures to implement, the Law on Handling of Administrative Violations;

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

Pursuant to the Government’s Decree No. 127/2013/ND-CP of October 15, 2013, on the sanctioning of administrative violations and coerced execution of administrative decisions in the field of customs, and Decree No. 45/2016/ND-CP amending and supplementing a number of articles of Decree No. 127/2013/ND-CP;

Pursuant to the Government’s Decree No. 215/2013/ND-CP of December 23, 2013, 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 detailing the sanctioning of administrative violations and coerced execution of administrative decisions in the field of customs as follows:

Chapter I

SANCTIONING OF CUSTOMS-RELATED ADMINISTRATIVE VIOLATIONS

Section 1

GENERAL PROVISIONS

Article 1.Scope of regulation and subjects of application

1. This Chapter details a number of articles of Chapter I of the Government’s Decree No. 127/2013/ND-CP of October 15, 2013, on the sanctioning of administrative violations and coerced execution of administrative decisions in the field of customs, which was amended and supplemented under the Government’s Decree No. 45/2016/ND-CP of May 26, 2016 (below referred to as the Decree, which was consolidated under the Ministry of Finance’s Document No. 10/VBHN-BTC of July 12, 2016).

2. Subjects of application:

a/ Customs officers, and persons competent to sanction customs-related administrative violations;

b/ Individuals and organizations that commit customs-related administrative violations;

c/ Other subjects involved in the handling of customs-related administrative violations.

Article 2.Application of legal documents and sanctioning principles

1. The sanctioning of administrative violations, application of sanctioning forms, remedial measures, and application of measures to deter, and secure the sanctioning of, administrative violations in the field of customs must comply with the principles, order, procedures and competence prescribed in Law No. 15/2012/QH13 on Handling of Administrative Violations, Law No. 78/2006/QH10 on Tax Administration, Law No. 21/2012/QH13 Amending and Supplementing a Number of Articles of the Law on Tax Administration, November 26, 2014 Law No. 71/2014/QH13 Amending and Supplementing a Number of Articles of the Laws on Taxes, the Government’s Decree No. 81/2013/ND-CP of July 19, 2013, detailing a number of articles of, and measures to implement, the Law on Handling of Administrative Violations, the Government’s Decree No. 115/2013/ND-CP of October 3, 2013, on the management and preservation of exhibits and means used in administrative violations, the Government’s Decree No. 83/2013/ND-CP of July 22, 2013, detailing a number of articles of the Law on Tax Administration and the Law Amending and Supplementing a Number of Articles of the Law on Tax Administration, the Government’s Decree No. 127/2013/ND-CP of October 15, 2013, on the sanctioning of administrative violations and coerced execution of administrative decisions in the field of customs, and the Government’s Decree No. 45/2016/ND-CP of May 26, 2016, amending and supplementing a number of articles of Decree No. 127/2013/ND-CP.

2. The sanctioning of customs-related administrative violations must comply with the provisions on application of legal documents in Article 156 of the Law on Promulgation of Legal Documents, and Article 3 of the National Assembly’s Resolution No. 24/2012/QH13 of June 20, 2012, on the implementation of the Law on Handling of Administrative Violations.

3. In case a customs-related violation is the consequence of another violation in the same field, only the violation subject to a heavier penalty shall be sanctioned.

Article 3.Determination of first-time violations

First-time violation referred to in Clause 2, Article 2 of the Decree means a violation committed by an individual or organization that has never been administratively sanctioned for such violation before or that has been administratively sanctioned for such violation but not repeated it for 6 months counting from the date of complete execution of the decision on warning, or 1 year counting from the date of complete execution of another administrative sanctioning decision, or from the date of expiration of the statute of limitations for execution of the administrative sanctioning decision.

Article 4.Cases not subject to sanctioning of customs-related administrative violations

Cases not subject to sanctioning of customs-related administrative violations specified in Article 5 of the Decree are settled as follows:

1. Within 3 days after the goods and vehicles are brought into the Vietnamese territory due to unexpected events orforce majeureevents, notices thereon shall be sent to the Customs Branches, Control Squadrons, Marine Control Squadrons, provincial-level Customs Departments, local administrations of the nearest places or other competent agencies in accordance with law.

If no notice is sent, the sanctioning shall be conducted on a case-by-case basis under the Government’s Decree No. 127/2013/ND-CP of October 15, 2013 (which was amended and supplemented under Decree No. 45/2016/ND-CP of May 26, 2016) or under other relevant regulations.

The determination of unexpected events orforce majeureevents must comply with Clauses 13 and 14, Article 2 of the Law on Handling of Administrative Violations.

2. The notification of mistakes prescribed in Clause 2, Article 5 of the Decree shall be made in writing by the goods consignor or consignee or his/her/its lawful representative, clearly stating the reason, and sent to the head of the Customs Branch of the place where the goods are stored, enclosed with documents proving the mistakes, provided customs declarations have not yet been registered.

In case there are grounds to believe that the goods consignor, goods consignee and/or carrier collude with each other to evade taxes, illegally transport goods across borders or smuggle goods, the customs office may refuse to accept the mistake and handle the case in accordance with law. Such refusal shall be made in writing, clearly stating the reason.

3. The provisions of Clause 3, Article 5 of the Decree apply to cases of modification of declarations and additional declaration of customs dossiers specified at Points a and b, Clause 1, Article 20 of the Ministry of Finance’s Circular No. 38/2015/TT-BTC of March 25, 2015, on customs procedures, customs inspection and supervision, import duty and export duty, and tax administration of imports and exports.

4. For the cases specified in Clauses 4, 5 and 7, Article 5 of the Decree:

a/ At the time of detecting a violation, if there are sufficient grounds to believe that the violation is not subject to sanctioning, the person with sanctioning competence shall only make a record of violation for filing;

b/ If there are insufficient grounds to identify whether or not the violation is subject to sanctioning, the customs officer on duty shall make a record of customs-related administrative violation; based on this record, the customs dossier and relevant documents, the person with sanctioning competence defined in Clause 2, 3, 4 or 5, Article 19 of the Decree shall decide to sanction or not to sanction the violation under current regulations;

c/ Tax-related violations for imports and exports specified in Clause 4, Article 5 of the Decree include violations specified in Clauses 1 and 2, Article 8, and Clauses 1 and 2, Article 13, of the Decree.

5. The provisions of Clause 6, Article 5 of the Decree apply in case customs declarants who carry out for the first time the procedures for import or export of goods have correctly declared the names of actually imported or exported goods under regulations on customs declaration but falsely declared the goods headings according to Vietnam’s List of Imports and Exports; or falsely declared duty rates or duty amounts for the goods according to the Export Tariff or Import Tariff effective at the time of registration of customs declarations.

6. Violations of the regulations on customs declaration or violations of the provisions of Article 14 of the Decree for imported goods or articles for which postal service providers or express mail service providers carry out the customs procedures on behalf of the goods owners under law shall not be sanctioned if there is no ground to believe that the goods consignor, goods consignee and customs declarant collude with one another in committing a fraud.

Article 5.Valuation of exhibits used in administrative violations for determining fine brackets and sanctioning competence

When it is necessary to valuate exhibits used in administrative violations for determining fine brackets and sanctioning competence, a competent person on duty shall valuate the exhibits and take responsibility for such valuation.

Exhibits used in violations shall be valuated as follows:

1. For exhibits not subject to confiscation, their value is the customs value determined under current regulations on customs valuation at the time of making a record of violation; for foreign currencies, their exchange rates shall be determined under Clause 3, Article 21 of 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.

2. For exhibits subject to confiscation, depending on their types, their value shall be determined under Clause 2, Article 60 of the Law on Handling of Administrative Violations.

If it is impossible to apply the grounds specified in Clause 2, Article 60 of the Law on Handling of Administrative Violations, a competent person on duty shall, pursuant to Clause 3, Article 60 of the Law on Handling of Administrative Violations, decide to temporarily seize the exhibits used in a violation (when necessary) and form a valuation council to determine the value of the exhibits to serve as a basis for determining fine brackets and sanctioning competence.

3. When determining the value of exhibits used in an administrative violation, a competent person on duty shall make a record. Valuation-related documents shall be included in the dossier on handling of administrative violations involving the valuation of exhibits used in the violation.

Article 6.Handling of goods or means used in violations which are not subject to confiscation

1. For temporarily seized goods or means not subject to confiscation, the person who has issued the decision to temporarily seize them shall issue a decision to return them.

2. The returned goods or means shall be cleared from customs procedures or brought out of Vietnam or re-exported under regulations; if they are liable to import duty, export duty and relevant taxes, duties and taxes shall be paid under regulations.

Section 2

APPLICATION OF SANCTIONING FORMS AND LEVELS

Article 7.Violations of the provisions on the time limit for customs clearance or submission of tax dossiers in Article 6 of the Decree

1. The provisions of Point a, Clause 1, Article 6 of the Decree apply to exported, imported or transited goods and vehicles on exit or entry or in transit.

2. The violations specified at Point g, Clause 3; Points a and b, Clause 4; and Clause 5, Article 6 of the Decree shall only be sanctioned if the time limit for re-import or re-export is stated in licenses, customs declarations or other papers prescribed by law.

3. The determination of the number of seats of vehicles used in violations as prescribed in Clause 5, Article 6 of the Decree shall be based on circulation registration certificates of passenger vehicles. If these certificates do not state the number of seats, such number shall be determined based on actual inspection and supervision of the vehicles.

Article 8.Violation of the provisions on customs declaration in Article 7 of the Decree

1. Acts of failing to make declaration or making false declaration of goods on the list of goods given as humanitarian aid or non-refundable aid as certified by the Ministry of Finance or an agency authorized by the Ministry of Finance shall be sanctioned under Clause 1, Article 7 of the Decree.

In case the goods are not on the list certified by a competent agency, violations shall be sanctioned under Article 8, or Clause 3, Article 14, of the Decree.

2. The provisions of Clause 3, Article 7 of the Decree apply in case the false declaration does not result in the deficiency of payable tax amounts, increase of exempted, reduced or refunded tax amounts, or non-collection of taxes, or in case a tax fraud or tax evasion is not committed. If the false declaration leads to the deficiency of payable tax amounts, increase of exempted, reduced or refunded tax amounts, or non-collection of taxes, or if a tax fraud or tax evasion is committed, the violations shall be sanctioned under Article 8 or 13 of the Decree.

3. For violations of the provisions of Clause 4, Article 7 of the Decree, if there are grounds to believe that the goods no longer exist or their use purposes change or they are not subject to customs declaration, such violations shall be sanctioned under Point g, Clause 1, Article 13 of the Decree.

4. The provisions of Clause 5, Article 7 of the Decree apply in case the goods have undergone customs declaration and clearance but not exported or they are exported in a quantity smaller than that declared. These provisions do not apply in case customs declarations are not valid for customs clearance as prescribed in Clause 2, Article 25 of the Customs Law.

Article 9.Violation of the provisions on tax declaration in Article 8 of the Decree

1. The sanctioning under Article 8 of the Decree applies to violations for modes of export and import of goods which lead to the deficiency of payable tax amounts, increase of exempted, reduced or refunded tax amounts, or non-collection of taxes.

2. For acts of failing to make declaration or making false declaration of the names, types, quantities, volumes, quality, value, headings, duty rates, duty amounts or origin of imports or exports, it is necessary to conduct the verification for clarifying whether the violations are stated in Article 8, or Clause 1, Article 13, of the Decree; if the violations do not fall in the cases specified in Clause 1, Article 13 of the Decree, they shall be sanctioned under Article 8 of the Decree.

3. For acts of making over declaration compared to the actually exported goods in terms of type, quantity or volume by export processing enterprises or for processed products, products produced for export and re-exported goods, and the tax amount difference is under VND 100,000,000, they shall be sanctioned under Point a, Clause 2, Article 8 of the Decree. If such difference is VND 100,000,000 or more, but the violations are not serious enough for being examined for penal liability, they shall be sanctioned under Point dd, Clause 1, Article 13 of the Decree.

Article 10.Violation of the provisions on customs declaration by persons on exit or entry with respect to foreign and Vietnamese currencies, negotiable instruments, gold, precious metals or gems as specified in Article 9 of the Decree

1. The provisions of Article 9 of the Decree apply in case persons on exit or entry with their passports, laissez-passers or border identity cards violate the provisions on customs declaration or carry along banned foreign currencies when carrying out the exit or entry procedures. Those who illegally carry across borders foreign and Vietnamese currencies, negotiable instruments, gold, precious metals or gems shall be sanctioned under Article 12 of the Decree.

2. The determination of foreign currencies permitted or not permitted to be carried along by persons on exit or entry with their laissez-passers or border identity cards must comply with the State Bank Governor’s Decision No. 92/2000/QD-NHNN7 of March 17, 2000, on carrying along of foreign and Vietnamese currencies by persons on exit or entry with their laissez-passers or border identity cards.

3. The value of exhibits used in violations is the value exclusive of the value of of the foreign currency, gold or Vietnamese currency amount exempted from customs declaration under law.

4. In case a violator has left Vietnam without information on his/her specific address, the concerned customs office shall still issue a sanctioning decision under regulations, and coordinate with the provincial-level External Affairs Department in sending this decision to the violator via the embassy or consular office of the country of which he/she is a national for compliance; if this decision cannot be delivered to the violator, the exhibits used in violations shall be disposed of under Clause 4, Article 126 of the Law on Handling of Administrative Violations.

Article 11.Violation of the provisions on customs inspection and tax inspection, customs supervision, and customs control in Articles 10, 11 and 12 of the Decree

1. The provisions of Point b, Clause 2, Article 10 of the Decree apply in case the making and archive of dossiers, documents and books are provided in legal documents on customs.

2. The provisions of Point c, Clause 2, Article 10 of the Decree apply in case related bodies or persons fail to comply with customs offices’ requests prescribed in relevant legal documents for inspection.

3. When having a doubt about the customs sealing; or detecting that documents used for declaration, submission or production to customs offices are forged or unlawful, such documents shall be temporarily seized. When necessary, to conduct the verification or solicit the assessment of such documents by competent agencies for use as a basis for determining the violations specified at Point a, Clause 5, Article 10 of the Decree. If such documents are licenses, the licensing agencies shall be informed thereof.

4. Violations of the provisions on transportation of goods in transit, port transfer, transshipment, or border-gate transfer, or goods temporarily imported for re-export not according to prescribed routes, roadmaps, places, border gates or time limit or not as registered in customs dossiers while the violators give no explanation or give explanations without plausible reasons, thus not being accepted by heads of the Customs Branches, shall be sanctioned under Point a, Clause 2, Article 11 of the Decree.

5. The provisions of Points d and dd, Clause 2, Article 11 of the Decree only apply in case the exhibits used in violations are not yet dispersed or consumed. If the exhibits have been dispersed or consumed, the violators shall be sanctioned under Point a, Clause 3, Clause 4, or Points a and b, Clause 5, Article 11, or Point d, Clause 5, Article 12, of the Decree.

6. For violations of the provisions of Clause 2, Article 12 of the Decree:

a/ For violations of the provisions of Clause 2, Article 12 of the Decree which are committed by under-14 persons, a competent person shall make a record of violation and issue a decision to confiscate or destroy the exhibits;

b/ When detecting that goods or currencies are illegally transported across borders or are not accompanied by lawful documents, thus violating the provisions of Clause 2, Article 12 of the Decree, while the violators have absconded leaving the exhibits or means used in violations, if having grounds to identify the violators (names and addresses), a competent person shall make a record of administrative violation and handle the violation in accordance with the Law on Handling of Administrative Violations; if it is impossible to identify the violators or owners of the exhibits or means used in violations, a competent person shall make a record of violation and dispose of such exhibits or means under regulations.

Article 12.Sanctioning of acts of tax evasion and tax fraud specified in Article 13 of the Decree

1. The documents and papers specified at Point a, Clause 1, Article 13 of the Decree include documents and papers submitted or produced to customs offices during and after the customs clearance as a basis for determining or evidencing payable tax amounts.

2. Sanctioning of acts of false declaration of headings, tax rates and tax amounts:

a/ The provisions of Point b, Clause 1, Article 13 of the Decree apply in case the customs office has provided the violators with guidance on headings, tax rates and tax amounts for goods having the same names, headings, tax rates and tax amounts with those of the violating goods by:

a.1/ Issuing a notice on goods analysis or classification results or issuing a document on prior determination of goods’ headings, tax rates and tax amounts; or,

a.2/ Issuing a tax assessment decision after having determined goods’ headings, tax rates and tax amounts.

b/ Other cases of false declaration of goods’ headings, tax rates and tax amounts shall be sanctioned under Article 8 of the Decree.

3. Acts of failing to make declaration or making false declaration of the names, types, quantities, volumes, quality, value, headings, duty rates, duty amounts or origin of imports or exports which are detected after the goods have been cleared from the customs procedures but the violators fail to pay sufficient tax amounts or have not yet paid sufficient tax amounts as prescribed before the customs office makes a record of violation shall be sanctioned under Point c, Clause 1, Article 13 of the Decree.

4. Violations relating to exports being processed products, products produced for export or products exported abroad by export processing enterprises: If the goods have been cleared from export procedures but not yet exported, the violations shall be sanctioned under Point d, Clause 1, Article 13 of the Decree. These provisions do not apply in case customs declarations are not valid for the customs clearance as prescribed in Clause 2, Article 25 of the Customs Law.

5. The provisions of Point l, Clause 1, Article 13 of the Decree apply when the customs office has sufficient grounds to believe that the taxpayers fail to make declaration or make false declaration for the purpose of tax evasion or tax fraud even though they know that the goods have been actually imported or exported.

6. The tax amount difference for violations specified in Articles 8 and 13 shall be determined based on the tax amount declared by the taxpayer and the payable tax amount stated in the competent person’s tax assessment decision or the payable tax amount as prescribed.

Article 13.Violations relating to licenses or import and export conditions

1. Licenses, conditions, standards and technical regulations referred to in Article 14 of the Decree are those prescribed in the Government’s Decree detailing the Commercial Law and guiding documents and other legal documents containing the provisions on licenses, conditions, standards and technical regulations for imports and exports.

2. For imports and exports requiring licenses, if importers and exporters can produce these licenses but the actual quantity and weight of goods are larger than the licensed ones, the goods owners shall be sanctioned for the act of importing and exporting goods without license with regard to the goods surplus.

3. For imports and exports requiring licenses, if importers and exporters can produce these licenses but the actually imported goods fail to meet the quality requirements (conditions, standards or technical regulations) stated in the licenses, the violations shall be sanctioned under Clause 7 or 8, Article 14 of the Decree.

4. Violations relating to import licenses or import and export conditions which involve goods bartered by border residents, goods given as humanitarian aid, gifts, donations, sample goods, personal effects or goods of persons on exit and entry; or transited and transshipped goods shall, depending on their severity, be sanctioned under Clause 1, 2, 3 or 4, Article 14 of the Decree; violations in other cases shall be sanctioned under Clause 5, Article 14 of the Decree.

5. For violations relating to licenses, conditions, standards or technical regulations for import as prescribed in Clauses 1, 2, 3, 4, 5, 7 and 8, Article 14 of the Decree, but goods used in the violations are permitted by a competent state agency for import before the sanctioning decision is issued, the remedial measure of “compelled bringing of goods out of the Vietnamese territory or compelled re-export of goods” shall not be applied.

In case the sanctioning decision has been issued with the application of the remedial measure of “compelled bringing of goods out of the Vietnamese territory or compelled re-export of goods” but the competent state agency permits the import of such goods within 30 days after receiving this decision and the goods have not yet been brought out of Vietnam, such goods shall be permitted for import.

Article 14.Handling of violations committed by state treasuries, credit institutions and related organizations and individuals

The provisions of Clause 3, Article 16 of the Decree do not apply to organizations and individuals being taxpayers. These taxpayers that violate the regulations on provision of information shall be sanctioned under Point b, Clause 3, Article 10 of the Decree.

Section 3

APPLICATION OF MEASURES TO DETER, AND SECURE SANCTIONING OF, ADMINISTRATIVE VIOLATIONS, SANCTIONING COMPETENCE

Article 15.Application of measures to deter, and secure sanctioning of, administrative violations

1. The application of measures to deter, and secure sanctioning of, administrative violations must comply with the principles, order, procedures and competence defined in Articles 119 thru 132 of the Law on Handling of Administrative Violations, Article 102 of Customs Law No. 54/2014/QH13 of June 23, 2014, and Article 17 of the Decree.

2. If the risk management system or relevant information helps detect narcotics hidden by an individual, a competent person shall conduct body search in person or may use technical facilities or equipment for the search.

3. Temporary seizure of exhibits or means used in administrative violations in case the violations fall beyond the sanctioning competence of directors of Customs Departments of provinces, inter-provincial regions or centrally run cities, the Director of the Anti-Smuggling Investigation Department or Director of the Post-Clearance Inspection Department:

Persons with the sanctioning competence defined in Clauses 3 and 4, Article 19 of the Decree shall issue decisions on temporary seizure of exhibits or means used in administrative violations under Clause 1, Article 125 of the Law on Handling of Administrative Violations; preserve exhibits or means used in administrative violations in accordance with the Law on Handling of Administrative Violations, and dispose of exhibits or means used in administrative violations under decisions of competent persons.

Article 16.Search of vehicles and objects according to administrative procedures

1. The search of vehicles and objects of persons entitled to privileges and immunities must comply with relevant treaties which Vietnam has signed or acceded to and requires a decision of the General Director of Customs.

2. When there are grounds to believe that luggage of a person on exit or entry who is entitled to privileges or immunities contains objects ineligible for privileges or objects banned from export or import by the Vietnamese State or failing to comply with Vietnam’s quarantine requirements, the search shall be conducted under a decision of the General Director of Customs to the witness of a diplomat or his/her authorized person.

Article 17.Determination of sanctioning competence

1. The competence to impose fines on tax-related violations prescribed in Articles 8 and 13, and Point a, Clause 1, Article 16, of the Decree, of the persons defined in Clause 7, Article 19 of the Decree shall be determined under the provisions of the Decree, without a maximum fine set out.

2. Handling of administrative violations with dossiers relating to different customs units:

a/ For administrative violations with dossiers relating to different customs units, the unit that is the first to detect, and make a record of, the violations shall issue a sanctioning decision; other related units shall transfer all necessary documents as required by the violation-accepting unit and coordinate with one another in implementing the sanctioning decision when so requested, except the case mentioned at Point b, Clause 2 of this Article;

b/ For administrative violations involving exhibits being goods transported for preservation at a place other than the place of customs clearance pending results of the quality inspection, food safety inspection, plant quarantine or animal quarantine, the Customs Branch where customs declarations are registered shall sanction the violations according to its competence; the Customs Branch participating in physical inspection of goods shall transfer all relevant documents to the Customs Branch where customs declarations are registered as a basis for sanctioning;

c/ Within 5 (five) days after issuing a sanctioning decision, the sanctioning Customs Branch shall notify sanctioning results to related customs units.

3. When detecting customs-related violations, a person with the sanctioning competence shall, pursuant to the provisions of the Penal Code, determine whether the violation is an administrative violation or a crime. If a sign of crime is detected, the criminal procedure law shall apply. For cases showing a sign of tax evasion crime, the case file shall be finalized and immediately transferred to a competent agency for investigation under regulations.

4. Violations or violators detected or arrested by units under the Anti-Smuggling Investigation Department while the sanctioning falls beyond the competence of the head of an Anti-Smuggling Control Squadron, head of the Control Squadron for Protection of Intellectual Property Rights, or head of a Marine Control Squadron under the Anti-Smuggling Investigation Department shall be sanctioned by the Director of the Anti-Smuggling Investigation Department under the General Department of Customs.

5. In case a principal penalty (fine) falls within the sanctioning competence of a person on duty while the additional penalty or remedial measure falls beyond his/her competence, this person shall immediately transfer the case file to an agency with the sanctioning competence under regulations.

6. For customs-related administrative violations with the form and level of sanctioning, value of confiscated exhibits or means, or remedial measure falling beyond his/her competence, the Director of the Customs Department of a province, an inter-provincial region or a centrally run city shall report them to the provincial-level People’s Committee of the locality where the violations are committed for its chairperson to issue a sanctioning decision.

7. For customs-related administrative violations with the form and level of sanctioning, value of confiscated exhibits or means, or remedial measure falling beyond his/her competence, the Director of the Anti-Smuggling Investigation Department or Director of the Post-Clearance Inspection Department shall organize investigation and verification to clarify the violations under Article 59 of the Law on Handling of Administrative Violations and transfer the case files (proposing the forms of sanctioning and remedial measures) to the General Director of Customs for him/her to issue a sanctioning decision according to competence.

Article 18.Empowerment for sanctioning administrative violations and applying measures to deter, and secure the handling of, administrative violations

1. The empowerment for sanctioning administrative violations to the titles prescribed in Clauses 2 thru 8, Article 19; Clauses 2, 3 and 4, Article 19a; and Clauses 2 thru 7, Article 19b of the Decree applies only to deputy heads. A document on empowerment shall be made, clearly stating the scope, contents and duration of the empowerment.

2. The empowerment for applying measures to deter, and secure the handling of, administrative violations must comply with the provisions of Chapter II, Part Four of the Law on Handling of Administrative Violations.

3. Deputy heads who are empowered to sanction administrative violations and apply measures to deter, and secure the handling of, administrative violations shall take responsibility before law and their heads for the handling of administrative violations and may neither empower nor authorize any other persons to do so.

4. A decision on task assignment or administration within a unit may not be used in substitution for a document on empowerment for sanctioning administrative violations and applying measures to deter, and secure the handling of, administrative violations.

Section 4

PROCEDURES FOR SANCTIONING ADMINISTRATIVE VIOLATIONS AND EXECUTION OF ADMINISTRATIVE SANCTIONING DECISIONS

Article 19.Making of records of administrative violations

The making of, and competence to make, records of administrative violations must comply with Article 58 of the Law on Handling of Administrative Violations, Article 6 of the Government’s Decree No. 81/2013/ND-CP of July 19, 2013, detailing a number of articles of, and measures to implement, the Law on Handling of Administrative Violations, and Article 18 of the Government’s Decree No. 127/2013/ND-CP of October 15, 2013, on sanctioning of administrative violations and coerced execution of administrative decisions in the field of customs.

Article 20.Transfer of files of administrative violations for sanctioning, extension of the time limit for issuing sanctioning decisions for violations falling beyond the competence of directors of Customs Departments of provinces, inter-provincial regions or centrally run cities, Director of the Anti-Smuggling Investigation Department or Director of the Post-Clearance Inspection Department

1. The transfer of files of administrative violations to customs offices for reporting to chairpersons of provincial-level People’s Committees or General Director of Customs for sanctioning must strictly comply with regulations. The time limit for transfer of files is prescribed as follows:

Within 5 (five) days after making a record of administrative violations, the Director of the Customs Department of the concerned province, inter-provincial region or centrally run city, Director of the Anti-Smuggling Investigation Department or Director of the Post-Clearance Inspection Department shall send the files of violations and propose forms of administrative sanctioning for the Chairperson of the provincial-level People’s Committee or General Director of Customs to issue a sanctioning decision.

For administrative violations involving complicated circumstances which are not subject to explanation or for violations subject to explanation under Clauses 2 and 3, Article 61 of the Law on Handling of Administrative Violations, the above time limit must not exceed 20 (twenty) days after a record of administrative violations is made.

2. For particularly serious violations involving complicated circumstances which are subject to explanation under Clauses 2 and 3, Article 61 of the Law on Handling of Administrative Violations and need more time for verification and collection of evidence for identifying the violations, the Director of the Customs Department of the concerned province, inter-provincial region or centrally run city, Director of the Anti-Smuggling Investigation Department or Director of the Post-Clearance Inspection Department shall report them to the General Director of Customs requesting extension of the above time limit.

Within 5 (five) days after this time limit is extended, the Director of the Customs Department of the concerned province, inter-provincial region or centrally run city, Director of the Anti-Smuggling Investigation Department or Director of the Post-Clearance Inspection Department shall send files of administrative violations, proposing forms of sanctioning, for the Chairperson of the provincial-level People’s Committee or General Director of Customs to issue a sanctioning decision according to competence.

3. Customs units that issue decisions to temporarily seize exhibits used in violations shall manage and dispose of such exhibits under Articles 82 and 126 of the Law on Handling of Administrative Violations.

Article 21.Transfer of files of administrative violations for criminal handling

1. When considering a violation for handling, if a person with the administrative sanctioning competence cannot identify whether it is an administrative violation or a crime, he/she shall send a written request for exchange of opinions, enclosed with a copy of the file of the violation, to the related body competent to conduct criminal proceedings (people’s procuracy or investigative body) before issuing a decision on administrative sanctioning or criminal handling. Within 10 (ten) days after receiving the request, if the consulted agency gives no reply, the person with the administrative sanctioning competence shall handle the violation under regulations, and then send one sanctioning decision to such body.

If the body competent to conduct criminal proceedings requests the transfer of the file of the violation for consideration and processing, Article 62 of the Law on Handling of Administrative Violations shall apply.

2. If seeing that a violation shows criminal signs, a person with the sanctioning competence who is on duty shall transfer the file of the violation to a competent person for consideration and initiation of a criminal case (for crimes of smuggling, cross-border illegal transportation of goods or currencies, or trading in banned goods prescribed in the Penal Code) or transfer the file to the body competent to conduct criminal proceedings for initiation of a criminal case for other cases showing signs of violating the penal law.

3. If the body competent to conduct criminal proceedings sends a notice on its decision to initiate a criminal case, the customs office shall transfer the original file of the violation to the former within 5 (five) days after receiving the notice.

Article 22.Issuance of sanctioning decisions

1. When sanctioning customs-related administrative violations with the application of caution or imposition of a fine of up to VND 250,000 for individuals, or VND 500,000 for organizations, the person with the sanctioning competence shall issue a sanctioning decision on the spot.

2. An administrative sanctioning decision takes effect on the date of its signing, unless it states another effective date. Within 10 (ten) days after receiving a sanctioning decision, the sanctioned individual or organization shall execute it.

3. The issuance of sanctioning decisions must comply with Articles 67 and 68 of the Law on Handling of Administrative Violations, and Article 6 of the Government’s Decree No. 81/2013/ND-CP of July 19, 2013, detailing a number of articles of, and measures to implement, the Law on Handling of Administrative Violations.

4. A sanctioning decision shall be issued within 7 (seven) days after a record of administrative violations is made.

For administrative violations involving complicated circumstances which are not subject to explanation or for violations subject to explanation under Clauses 2 and 3, Article 61 of the Law on Handling of Administrative Violations, a sanctioning decision shall be issued within 30 (thirty) days after a record of administrative violations is made.

For a particularly serious violation involving complicated circumstances which is subject to explanation under the provisions of Paragraph 2, Clause 2, and Clause 3, Article 61 of the Law on Handling of Administrative Violations and needs more time for verification and collection of evidence, at least 10 (ten) days before the expiration of the time limit for issuing a sanctioning decision, a competent person on duty shall report such in writing to his/her head, requesting extension of this time limit; the extension shall be recorded in writing and must not exceed 30 (thirty) days.

5. For diplomats or consuls who take advantage of their privileges or immunities to conduct commercial activities beyond their vested functions, thus committing customs-related administrative violations, their violations shall be sanctioned after opinions are exchanged with diplomatic missions or consulates of their countries.

Article 23.Execution of sanctioning decisions

1. The execution of sanctioning decisions must comply with the provisions of Section 2, Chapter III, Part Two of the Law on Handling of Administrative Violations.

2. Persons with the sanctioning competence who have issued sanctioning decisions shall supervise, inspect and urge the sanctioned individuals or organizations in executing such decisions and issue coercive decisions if the sanctioning decisions are not executed within the prescribed time limit.

3. For sanctioning decisions issued by chairpersons of provincial-level People’s Committees, Directors of Customs Departments of provinces, inter-provincial regions or centrally run cities that transfer files of violations shall supervise the execution of such decisions and report thereon to chairpersons of provincial-level People’s Committees.

If the sanctioning decisions are not executed within the prescribed time limit, Directors of Customs Departments shall propose the application of coercive measures for chairpersons of provincial-level People’s Committees to issue coercive decisions.

4. For sanctioning decisions issued by the General Director of Customs, the Director of the Anti-Smuggling Investigation Department or Director of the Post-Clearance Inspection Department shall organize and supervise the execution of these decisions; assume the prime responsibility for disposing of exhibits and means used in violations under such decisions; collect and remit fines and proceeds from the sale of confiscated exhibits into the state budget under current regulations.

If the sanctioning decisions are not executed within the prescribed time limit, the Director of the Anti-Smuggling Investigation Department or Director of the Post-Clearance Inspection Department shall report such to the General Director of Customs and propose the application of coercive measures for the latter to issue coercive decisions.

Article 24.Supervision of the bringing out of the Vietnamese territory or re-export of goods or means used in violations

Goods and means used in violations which are compelled to be brought out of the Vietnamese territory or to be re-exported are subject to strict supervision from their storage places to the border gates of re-export.

Supervision results shall be certified in writing by border-gate customs offices and sent to issuers of sanctioning decisions within 5 (five) days after the goods have been brought out of the Vietnamese territory or re-exported for filing.

Article 25.Handling of cases of late payment of fines

Individuals or organizations sanctioned for their customs-related administrative violations that pay fines later than the deadline for execution of administrative sanctioning decisions shall pay not only a sufficient fine amount but also a daily interest equivalent to 0.05% of the total unpaid fine amount.

The period of considering and deciding on reduction or exemption of the unpaid fine amount or permitting payment of fines in installments shall not be considered a late payment period.

Chapter II

COERCED EXECUTION OF CUSTOMS-RELATED ADMINISTRATIVE DECISIONS

Section 1

GENERAL PROVISIONS

Article 26.Scope of regulation and subjects of application

1. This Chapter details a number of articles of Chapter II of the Government’s Decree No. 127/2013/ND-CP of October 15, 2013, on the sanctioning of administrative violations and coerced execution of administrative decisions in the field of customs, and the Government’s Decree No. 45/2016/ND-CP of May 26, 2016, amending and supplementing a number of articles of Decree No. 127/2013/ND-CP (below referred to as the Decree, which was consolidated under the Ministry of Finance’s Document No. 10/VBHN-BTC of July 12, 2016).

2. Subjects of application

a/ Organizations and individuals coerced to execute customs-related administrative decisions under the Law on Tax Administration and the Law Amending and Supplementing a Number of Articles of the Law on Tax Administration (below collectively referred to as the Law on Tax Administration);

b/ Customs offices and officers;

c/ Persons with the competence and responsibility to coerce the execution of customs-related administrative decisions;

d/ State agencies and other organizations and individuals involved in the coerced execution of customs-related administrative decisions.

Article 27.Supervising and pressing for collection of owed tax and fine amounts

1. Customs offices at all levels shall supervise and manage subjects owing tax and fine amounts; and regularly classify owing subjects and owed amounts for urging the collection of owed amounts before applying coercive measures.

Forms of pressing for collection of owed tax and fine amounts:

a/ Sending notices to request taxpayers or tax payment guarantors to sufficiently pay owed tax and fine amounts;

b/ Directly coming to taxpayers’ head offices to claim owed tax and fine amounts;

c/ Informing online the lists of subjects having overdue owed tax and fine amounts;

d/ Notifying in the mass media subjects that owe tax and fine amounts, and owned tax and fine amounts.

2. Taxpayers or tax payment guarantors that still have owed tax and fine amounts shall, when being notified by customs offices of such owing, sufficiently pay the tax and fine amounts in accordance with law. Past the time limit prescribed in Article 26 of the Decree, if they fail to make payment, they shall be subject to coercive measures prescribed in Article 27 of the Decree.

Article 28.Coercion in case of tax assessment for goods already cleared from customs procedures

In case of tax assessment after the goods have been cleared from customs procedures, if, past 90 days from the deadline for execution of tax assessment decisions, taxpayers or tax payment guarantors do not voluntarily execute these decisions, customs offices shall coerce the execution of these decisions under regulations. The deadline for execution of a tax assessment decision prescribed in this Article is the date the customs office issues such decision under the Minister of Finance’s Circular No. 38/2015/TT-BTC of March 25, 2015.

Article 29.Issuance of coercive decisions

1. Persons competent to issue coercive decisions shall promptly verify information and issue decisions to coerce the execution of customs-related administrative decisions in case the prescribed deadline has expired but taxpayers or tax payment guarantors or violators do not voluntarily execute customs-related administrative decisions or disperse property or abscond.

2. The verification of information related to persons subject to coercion and conditions for execution of coercive decisions must comply with Articles 33 and 38; Clause 1, Article 43; and Clause 1, Article 61, of the Decree.

For coercive measures to compel the application of remedial measures, before issuing a coercive decision, a competent person shall exchange in writing opinions with the People’s Committee of the commune, ward or township, public security agency and other related agencies in the locality where the person subject to coercion resides or where exhibits, articles or means used for the administrative violation are stored on the actual state of such exhibits, articles or means (whether they are preserved in status quo or have been sold, dispersed or destroyed, and other information on their actual state), conditions for execution of the coercive decision of the person subject to coercion before the coercive decision is issued.

3. In case a coercive decision on a coercive measure to execute a tax-related administrative decision has expired, if the competent person that has issued such decision has a ground to believe it is possible to continue applying such coercive measure while tax arrear, fine and late-payment interest amounts can still be collected, he/she shall issue a new decision to replace the expired decision in order to continue applying such coercive measure.

Evidence and documents that serve as grounds for the issuance of a coercive decision shall be preserved in the case file.

4. In case a coercive decision to apply a coercive measure is issued while information and conditions for application of a previous coercive measure are available, the coercive decision issuer may decide to terminate the currently applied coercive measure and issue a decision to apply the previous coercive measure in order to secure collection of sufficient tax, fine and late tax-payment interest amounts.

Contents of the newly issued decision must state the invalidation of the previously issued coercive decision.

5. In case of having sufficient grounds to believe that the application of the current coercive measures cannot help collect tax arrear, fine and late tax-payment interest amounts, a person competent to issue coercive decisions may invalidate the currently executed coercive decision and issue a decision to apply the subsequent coercive measure.

Contents of the newly issued decision must state the invalidation of the previously issued coercive decision.

Article 30.Organization of execution of coercive decisions

1. Persons who issue coercive decisions to compel the execution of administrative decisions in the field of customs shall organize the execution of such coercive decisions.

2. For coercive decisions issued by chairpersons of provincial-level People’s Committees or the General Director of Customs, directors of the Customs Departments of provinces, inter-provincial regions or cities, the Director of the Anti-Smuggling Investigation Department or the Director of the Post-Customs Clearance Inspection Department shall organize the execution of such decisions and report on execution results to the chairpersons of provincial-level People’s Committees and General Director of Customs.

3. In case of application of the coercive measure of property distraint or appropriation of money and property held by other organizations or individuals that are based in other localities, directors of the Customs Departments of provinces, inter-provincial regions or cities managing such localities shall coordinate with customs offices that have issued the coercive decisions or customs offices that are responsible for organizing the execution of coercive decisions of chairpersons of provincial-level People’s Committees or General Director of Customs in organizing the execution of such coercive decisions.

Article 31.Postponement of application of coercive measures; suspension of application of the coercive measure to cease the carrying out of customs procedures

1. Cases of postponement of application of coercive measures; suspension of application of the coercive measure to cease the carrying out of customs procedures:

a/ Taxpayers subject to the application of coercive measures may be allowed by customs offices to pay tax arrears in installments under Article 39 of the Government’s Decree No. 83/2013/ND-CP of July 22, 2013, detailing a number of articles of the Law on Tax Administration and the Law Amending and Supplementing a Number of Articles of the Law on Tax Administration;

b/ Taxpayers for whom the application of coercive measures is suspended may cease carrying out the customs procedures under Clause 5, Article 46 of the Decree.

2. Procedures and competence for handling different cases:

a/ For cases of payment of tax arrears in installments under Article 39 of Decree No. 83/2013/ND-CP, and Article 134 of the Ministry of Finance’s Circular No. 38/2015/TT-BTC of March 25, 2015, guiding customs procedures, inspection and supervision; export duty, import duty and tax administration of exports and imports.

b/ For cases of suspension of application of the coercive measure to cease the carrying out of customs procedures for exports or imports specified in Clause 5, Article 46 of the Decree:

b.1/ Taxpayers subject to coercion send written requests for suspension of the coercion to the provincial-level Customs Departments of localities where arise the debts subject to coerced cessation of customs procedures, enclosed with guarantee letters of credit institutions for unpaid tax arrear, fine and late-payment interest amounts;

b.2/ Provincial-level Customs Departments of localities where taxpayers have debts subject to coerced cessation of customs procedures shall receive and examine the accuracy and completeness of dossiers and send reports and recommendations to the General Department of Customs within 5 (five) working days after receiving complete dossiers;

For an incomplete dossier, within 3 (three) working days after receiving it, the customs office shall notify such to the taxpayer for completion of the dossier.

b.3/ The General Department of Customs shall base itself on Clause 5, Article 46 of the Decree to examine dossiers, consult related units (if any), and report to the Ministry of Finance within 7 (seven) days working days after receiving a complete dossier;

b.4/ The Ministry of Finance shall consider suspending the coercive measure of ceasing the carrying out of customs procedures for each specific case at the request of the General Department of Customs within 5 (five) working days after receiving a report of the General Department of Customs;

b.5/ Customs offices that issue coercive decisions shall base themselves on the Ministry of Finance’s documents on suspension of the coercive measure of ceasing the carrying out of customs procedures to postpone the application of such coercive measure.

3. Documents on suspension of execution of coercive decisions to compel the execution of tax-related administrative decisions in the field of customs for cases where taxpayers are allowed by customs offices to pay tax arrears in installments and cases for which the application of the coercive measure of ceasing the carrying out of customs procedures is suspended shall be made according to form QD-59 in the Appendix to this Circular.

Article 32.Coercion in cases where taxpayers that have not yet abided by tax-related administrative decisions in the field of customs abscond or disperse property

1. Signs of absconding or dispersal of property

a/ Signs of absconding:

Taxpayers that have not yet abided by tax-related administrative decisions no longer conduct production or business activities in their places of business registration, certified by People’s Committees of communes, wards or townships or street quarters where taxpayers subject to coercion carry out their business activities, or are notified by tax offices as having ceased their activities (including those dissolved not according to the procedures prescribed by the Law on Enterprises);

b/ Signs of dispersal of property:

Taxpayers that have not yet abided by tax-related administrative decisions carry out the procedures for transfer, donation or sale of property, release or dispersal of their account balance in an abnormal manner not relating to their ordinary transactions or it is inspected or verified that no goods are left in their enterprises.

2. Persons competent to issue coercive decisions shall base themselves on verified information to issue decisions to apply coercive measures according to the order and procedures prescribed for each measure in Chapter II of the Decree and shall, pursuant to this Circular, fully collect tax, fine and late payment interest amounts (if any) into the state budget.

Article 33.Expenses for coerced execution of administrative decisions

1. Specific expenses for activities of coercing the execution of administrative decisions specified in Article 37 of the Decree include:

a/ Expense for mobilizing persons to execute coercive decisions: remuneration for agencies, organizations and individuals directly involved in the coerced execution of administrative decisions, including coercive decision issuers, executors, security police officers, medical workers, representatives of local administrations and social organizations, etc;

b/ Expense for valuation and auction of property: remuneration for valuation council members; expense for expert examination of property (if any); rents for venue and means for the auction and listing, and expense for revaluation of property; expense for publishing auction announcements in the mass media; expense for keeping or preservation of property; cost of transportation of objects and property involved in the coerced execution of coercive decisions;

c/ Rents for vehicles for dismantlement and transportation of objects and property; fuel cost, rents for protection means and equipment and medical equipment to serve the execution of coercive decisions;

d/ Expense for hired keeping or preservation of distrained property;

dd/ Expense for fire and explosion prevention and fighting (if any): rented fire engines, fire prevention and fighting devices, hired sweeping of bombs and land mines and other necessary fire and explosion prevention and fighting equipment;

e/ Expense for publishing information on tax debtors in the mass media;

g/ Other actual expenses for the execution of coercive decisions (if any).

2. Expense levels

a/ Expenses for hired keeping or preservation of property; expert examination of property; rents for venue and means for auction of property; expense for publishing property auction announcements in the mass media; freight for hired transportation of objects and property involved in the coerced execution of coercive decisions, etc., shall be paid under lawful and valid contracts, invoices and expenditure documents;

b/ Levels of other expenses must comply with the State’s regulations.

In case the State has no regulations on such expenses, persons who organize the execution of coercive decisions shall decide on actual expense levels accompanied with lawful invoices and documents and take responsibility for their decisions.

3. Funding sources to pay expenses for the execution of coercive decisions

a/ Expenses for the coerced execution of coercive decisions shall be borne by persons subject to coercion;

b/ Customs offices that issue coercive decisions shall make estimates of coercion expenses concurrently with the issuance of coercive decisions and may settle such expenses upon the conclusion of cases subject to coercion;

c/ In case expenses for coerced execution are borne by persons subject to coercion but have not yet been collected by customs offices, these customs offices may make advances from operation funds of the customs sector and refund the advanced amounts immediately after collecting expenses from persons subject to administrative coercion. The advance level must not exceed VND 100,000,000 (one hundred million). For cases where expense levels are higher than the permitted advance amounts, coercive decision issuers shall report to superior customs offices for consideration and decision on each specific case.

Article 34.Coercive-decision execution expense exemption and reduction

1. An individual subject to coercion may be considered for coercive-decision execution expense exemption or reduction if falling into one of the following cases:

a/ Having an economic difficulty: An individual that has an economic difficulty is the one whose income is not enough to cover the minimum daily-life needs of his/her normal livelihood or who falls into a prolonged particularly difficult economic situation caused by a natural disaster or fire. The minimum income means an income not liable to income tax applicable to high-income earners;

b/ Being a member of a policy-benefiting family or a family having made meritorious contributions to the revolution;

c/ Being a single aged person without anyone to rely on, a person with disabilities or a person suffering a prolonged disease.

2. Procedures for enjoying coercive-decision expense exemption or reduction:

To be considered for coercive-decision execution expense exemption or reduction, individuals shall send written requests for consideration for such exemption or reduction to customs offices that have issued coercive decisions.

Documents to be enclosed with such a written request:

a/ A person subject to coercion who has an economic difficulty caused by a natural disaster or fire shall obtain certification by the commune-level People’s Committee of the locality where he/she resides or the head of the agency or organization where he/she works;

b/ A person subject to coercion whose income is not enough to cover the minimum daily-life needs of his/her normal livelihood or who is a member of a policy-benefiting family or a family having made meritorious contributions to the revolution shall carry out the procedures and prepare a dossier under current regulations on recognition of, and settlement of benefits for, fallen heroes and their families, war invalids and persons entitled to policies applicable to war invalids, and diseased soldiers;

c/ A person subject to coercion with disabilities or suffering from a prolonged illness shall obtain a written certification by a medical assessment council or competent medical body under regulations of the Ministry of Health.

3. Coercive-decision expense exemption or reduction levels:

a/ An individual subject to coercion who has paid part of coercive-decision execution expenses but falls into a prolonged particularly difficult economic situation caused by a natural disaster or fire may be considered for the reduction of the unpaid coercive-decision expenses;

b/ In other cases, an individual subject to coercion may be considered for 50%- (fifty percent) reduction of the payable coercive-decision expenses.

4. A coercive decision issuer shall receive a written request and enclosed dossier, and consider and decision on the coercive-decision expense exemption or reduction within 5 (five) working days.

In case a coercive decision-issuing agency issues a decision on coercive-decision execution expense exemption or reduction, such expense shall be covered by operation funds of such agency.

5. A decision on coercive-decision execution expense exemption or reduction shall be cancelled in case of detecting an act of dispersing or hiding money or property of the person subject to coercion in order to shirk the verification of specific conditions for coercive decision execution.

Section 2

COERCIVE MEASURES AND ORDER AND PROCEDURES FOR COERCED EXECUTION OF TAX-RELATED ADMINISTRATIVE DECISIONS IN THE FIELD OF CUSTOMS

Article 35.Coerced execution by the measure of deducting money from accounts of persons subject to coerced execution of tax-related administrative decisions at state treasury offices or credit institutions; requests for account freezing

1. A person subject to coerced execution of a tax-related administrative decision and organizations and individuals that are holding his/her money shall provide the person competent to issue coercive decisions with information on his/her account, such as where his/her account is opened, number, sign and current monetary balance of his/her account, when receiving a request of the person competent to issue coercive decisions.

2. A competent person shall base himself/herself on the available database, tax arrear, fine and late payment (90 days overdue) interest amounts and verified and collected information to issue a coercive decision to be executed by the measure of deducting money from the account of the person subject to coercion at a state treasury office or a credit institution or decision to shift to a subsequent coercive measure if the time limit prescribed in Clause 1, Article 40 of the Decree has expired or if the account has no deposit balance.

3. In case the account balance is smaller than the amount to be deducted from the account of a person subject to coercion, the state treasury office or credit institution shall still deduct and transfer such balance and then further deduct and transfer the deficit when there is a remittance into the account during the effective duration of the coercive decision.

4. In case of receiving information about failure of an individual or organization to execute a tax-related administrative decision in the field of customs while he/she/it commits an act of dispersing property or absconding, a person competent to issue coercive decisions shall issue a coercive decision, clearly stating a request for deduction of money from the account of the person subject to coerced execution of the administrative decision, or send a written request (if it has previously issued a coercive decision) to the state treasury office or credit institution to deduct money from the account of such individual or organization.

Article 36.Coerced execution by the measure of deducting part of wage or income

1. Based on verification results, a person competent to issue coercive decisions shall:

a/ Issue a coercive decision to be executed by the measure of deducting part of wage or lawful income of the individual subject to coercion;

b/ Issue a decision to shift to the subsequent coercive measure if the individual subject to coercion has no lawful income, or in case the individual subject to coercion or the organization or individual paying wage or income and related organizations and individuals fail to provide information on wage and income of the individual subject to coercion to the person competent to issue coercive decisions within 3 (three) working days after receiving a request of such person.

2. Total wage and income amounts serving as a basis for the deduction include all wage amounts, wage-based allowances and other lawful income amounts earned in a month.

Article 37.Coerced execution by the measure of ceasing the carrying out of customs procedures for imports or exports

1. A person competent to issue coercive decisions shall base himself/herself on the available database, verified information and results of coerced execution by the measure of deducting money from the account of the person subject to coerced execution of the tax-related administrative decision at a state treasury office, commercial bank or credit institution or on results of coerced execution by the measure of deducting part of wage or income to issue a coercive decision to be executed by the measure of ceasing the carrying out of customs procedures for imports or exports.

2. A coercive decision issuer shall disclose coercive decisions to be executed by the measure of ceasing the carrying out of customs procedures for imports or exports on the e-portal of the customs sector within the time limit prescribed in Clause 3, Article 46 of the Decree.

Article 38.Coerced execution by the measure of distraining property or auctioning distrained property in accordance with law

1. Verification of information on property of persons subject to coercion

a/ A person competent to issue coercive decisions may send a written request to the person subject to coercion, the property ownership registry office (when information on property is available), secured transaction registry office and related organizations and individuals for verification of property;

b/ A person competent to issue coercive decisions may himself/herself verify the property of the organization or individual subject to coercion in the locality where such organization is based or such individual resides, the property ownership registry office, secured transaction registry office and related organizations and individuals;

c/ Information to be verified includes verified property and their value stated in accounting books of the organization/individual subject to coercion, production or business results (for production, business or service establishments) or economic conditions (for non-business individuals). For property subject to registration, of which the ownership transfer must be based on the purchase and sale, conversion, transfer or donation contract or title document, the verification shall be conducted through the property owner, local administration, competent agency or observer as stated by the seller, local administration or competent agency in the certification of purchase and sale.

The verification shall be recorded in writing, clearly stating verified contents and bearing signatures of information providers;

d/ Verified information on property subject to ownership registration or transfer may be publicly notified to persons with related rights and obligations so that they may protect their interests;

dd/ For property already put in lawful pledge or mortgage and ineligible for distraint under Article 49 of the Decree, the agency conducting the distraint shall notify the pledgee or mortgagee of the obligations of the person subject to coercion and request the pledgee or mortgagee to promptly inform it of the obligation fulfillment by the pledgor or mortgagor under the pledge or mortgage contract;

e/ After verifying the property of the taxpayer at the above places, a person competent to issue coercive decisions shall identify the money amount which can be remitted into the state budget through distraint by estimating the value of such property after the auction.

In case the money amount being proceeds from the coercion is not enough to cover coercive-decision expenses, the person competent to issue coercive decisions shall report to the superior agency for postponement of the issuance of a coercive decision (except the case eligible for coercive-decision execution expense exemption or reduction specified in Clause 4, Article 34 of this Circular);

g/ In case the property ownership registry office, secured transaction registry office and related organizations and individuals fail to provide or insufficiently provide information on property within 5 (five) working days after notifying in writing the person subject to coercion of the verification of property, or the proceeds from the coerced execution are not enough to cover coercive-decision execution expenses, the subsequent coercive measure shall be applied.

2. After issuing a coercive decision to be executed by the measure of distraining property subject to ownership registration, a distraint organizer shall promptly notify the property distraint to the following agencies:

a/ The land use rights registry office and agency competent to carry out land-attached property registration, in case of distraint of land use rights and land-attached property;

b/ The road vehicle registry office, in case the distrained property is a road motor vehicle;

c/ Other agencies competent to carry out ownership and use right registration in accordance with law.

3. Procedures for applying the measure of distraining property

a/ The distraint of property shall be conducted in the daytime and within working hours applicable in the locality where the distrained property exists. If detecting the act of absconding, dispersing or destroying property of the person subject to coercion, the person competent to issue coercive decisions may promptly organize the distraint of property to stop such act;

b/ In case of distraint of property being a locked house or a packaged object, the distraint organizer may request the person subject to coercion or person currently using or managing the property to unlock or unpack it. If the person subject to coercion or person currently using or managing the property refuses to unlock or unpack it or is intentionally absent, the organization executing the coercive decision shall make a written record (in the presence of the local administration’s representative and an observer) of the unlocking or unpacking for checking and listing of property items and distraint in accordance with law;

c/ From the time of receiving a notice of distraint of a property, the property ownership or use right registry office shall no longer carry out the registration of transfer of such property, unless otherwise provided by law.

Within 3 (three) working days after the distraint of a property is released or the sale or handover of distrained property is completed for the coerced execution of a tax-related administrative decision, the distraint organizer shall notify such to the property ownership registry office or secured transaction registry office specified at Point c, Clause 3 of this Article.

4. Some specific cases of distraint

a/ Land use rights, house or office of a person subject to coercion may be distrained only if the value of his/her other property, after being fully distrained, is not enough to cover coercive-decision execution expenses;

b/ Only the property of a person subject to coercion which is valuable enough for securing the execution of the coercive decision and covering coercive-decision execution expenses shall be distrained. In case a person subject to coercion has only one property which has a value larger than his/her obligation to execute the coercive decision and cannot be divided or if the division may significantly devalue such property, the distraint organizer may still distrain such property to secure the execution of the coercive decision;

c/ In case a person subject to coercion has a real estate as his/her private property and concurrently has part of a movable property co-owned by many persons and his/her part of such common property is valuable enough for the execution of the coercive decision, the distraint organizer shall clearly explain such and ask him/her which property he/she wants to be distrained first to secure the execution of the coercive decision;

d/ In case a person subject to coercion requests the distraint of a movable property being part of a common property he/she shares with another person, the distraint organizer shall distrain such property and ensure the preemptive right of the co-owner to purchase it;

dd/ If a person subject to coercion has no other property, the distraint organizer may also distrain his/her property currently in a pledge or mortgage if the value of such property is larger than the secured obligation. The distraint organizer shall notify the pledgee or mortgagee of the distraint.

5. Handover of distrained property for preservation

If a person subject to coercion, person currently using or managing a property or next of kin of a person subject to coercion refuses to preserve a distrained property or when seeing a sign of dispersing or destroying property or obstructing the execution of the coercive decision, the distrained property may, on a case-by-case basis, be handed over to an organization or individual that has conditions for preservation.

A property distraint organizer shall safely keep and preserve files and documents on property ownership and use rights during the coercive-decision execution.

6. When distraining a property, a distraint organizer shall temporarily calculate the value of to-be-distrained property items in order to distrain only the property value enough to pay the tax arrear, late tax-payment interest, fine or late fine-payment interest amounts stated in the coercive decision and coercive-decision execution expenses. The distraint organizer may refer to market prices and opinions of related agencies and involved parties to temporarily calculate the value of the distrained property.

7. The valuation council and its tasks

a/ Composition of the valuation council: The coercive decision issuer is the chairperson and representatives of related financial and specialized agencies are members of the council. The person assuming the prime responsibility for execution of the coercive decision may hire or solicit the expert examination of the property value. When receiving a request of the person assuming the prime responsibility for execution of the coercive decision, specialized agencies shall send their experts to participate in the valuation.

Representatives of specialized agencies in the valuation council are persons who have professional and technical expertise employed by agencies competent to perform the professional management of to-be-valuated property. For to-be-valuated property being houses, the valuation council must have representatives of the housing and land management agency and construction management agency as its members.

b/ Tasks of the valuation council:

Within 7 (seven) working days after being established, the valuation council shall conduct the valuation. Individuals whose property is distrained or representatives of organizations that have their property distrained may contribute their opinions to the valuation but final decisions shall be made by the valuation council.

The valuation council shall base itself on market prices at the time of valuation and expert opinions of agencies and organizations conducting the expert examination of the property to determine the property price. The valuation council shall decide on the property price by majority rule. In case opinions of different council members are equally divergent on the property price, the opinion of the council chairperson shall be used as the basis for determination of the reserve price for property sale. The valuation council members may reserve their own opinions and request heads of customs offices to review the valuation. For property subject to price management by the State, the valuation shall be based on property prices prescribed by the State.

8. An agency that organizes the coerced execution of a coercive decision may organize the revaluation of property in the following cases:

a/ It has grounds to believe there is a violation of the valuation procedures;

b/ There is a big price fluctuation;

c/ Past six months from the date of valuation, the valuated property remains unsold.

9. Revaluation of property

When finding it necessary to revaluate a property, an agency organizing the coerced execution of a tax-related administrative decision shall send a written notice of property revaluation to the property valuation council for coordination or solicit a valuation agency formed in accordance with law to conduct the property revaluation. The property valuation under Points a and b, Clause 8 of this Article shall be conducted as follows:

a/ The property valuation is regarded as involving a violation of the valuation procedures if falling into one of the following cases:

a.1/ The valuation council is not composed of required persons;

a.2/ The person subject to coercion has not been duly notified to participate in the property valuation;

a.3/ The regulations on property prices are not properly applied, for property subject to price management by the State;

a.4/ There is a serious violation in the classification and valuation of property;

a.5/ Other cases specified by law;

b/ A distrained property is regarded as having experienced a big price fluctuation in the following cases:

The price fluctuates by at least twenty percent (20%), for property valued under VND 100 million.

The price fluctuates by at least ten percent (10%), for property valued between VND 100 million and under VND 1 billion.

The price fluctuates by at least five percent (5%), for property valued at least VND 1 billion;

c/ A person subject to coercion may request a customs office to reconsider a property price upon a price fluctuation before receiving a public notice of to-be-auctioned property. The customs office shall base itself on the market price and price provided by the price management agency to determine whether there is a price fluctuation and decide on the revaluation.

10. Determination of a reserve price for auction of a distrained property:

A reserve price for auction of a property is the property value determined through valuation upon the property distraint under Article 54 of the Decree.

11. Proceeds from the auction of a distrained property of a person subject to coercion shall be handled in the following order:

a/ To pay the expenses for coercive-decision execution and auction of the distrained property held by another individual or organization;

b/ To remit tax, late payment interest and fine amounts stated in the coercive decision into the state budget revenue account or custody account opened by the customs office at the State Treasury;

c/ To refund the remainder (if any) to the person subject to coercion.

Article 39.Coerced execution by the measure of collecting money or property of persons coerced to execute customs-related administrative decisions held by other organizations or individuals

1. Organizations or individuals that are holding money, property, goods or valuable papers or certificates of persons coerced to execute customs-related administrative decisions include:

a/ Organizations or individuals that owe due debts to persons subject to coercion;

b/ Organizations, individuals, state treasuries, banks or credit institutions authorized by persons subject to coercion to hold on their behalf money, property, goods or valuable papers or certificates, or customs offices that have sufficient grounds to prove that money, property, goods or valuable papers or certificates currently held by individuals, households or organizations are owned by persons subject to coercion.

2. Verification of information

a/ A person competent or authorized to issue coercive decisions may collect and verify information by requesting in writing a third party currently holding money or property of a person subject to coercion to provide information on such money or property or a debt payable to the person subject to coercion.

In case the third party currently holding money or property of the person subject to coercion fails to do so, it/he/she shall justify in writing the reason with the customs office within 5 (five) working days after receiving a written request of the customs office;

b/ Based on information provided by the third party currently holding money or property of the person subject to coercion, the competent person shall issue a coercive decision to be executed by the measure of collecting money or property of the person subject to coercion currently held by the third party or a debt payable to the person subject to coercion;

c/ Past 5 (five) working days after a written request for provision of information on money or property it is holding or a debt payable to the person subject to coercion is sent to the third party, if the third party fails to provide information, provides inadequate information or justifies in writing the reason for failure to provide information, the competent person shall shift to the subsequent measure;

d/ In case no information on money or property of the person subject to coercion held by another organization or individual is available, the competent person shall shift to the subsequent measure.

Article 40.Coerced execution by the measure of revoking business registration certificates, enterprise registration certificates, establishment and operation licenses or practice licenses

1. Verification of information

A person competent or authorized to issue coercive decisions shall organize the verification of information that a taxpayer is subject to the measure of revoking a business registration certificate, enterprise registration certificate, establishment and operation license or practice license through data on such taxpayer at the customs office or state agency competent to grant such certificate or license for use as the basis for issuance of a coercive decision, and send a written request to such agency for revocation of such certificate or license.

2. Coercive decisions

a/ A coercive decision to be executed by the measure of revoking a business registration certificate, enterprise registration certificate, establishment and operation license or practice license must clearly state the date of issuance of the decision, grounds for issuance; full name, position and office of the issuer; registered name, business address and tax identification number of the individual subject to such measure; the type of certificate or license requested to be revoked (serial number and date of issuance); money amount subject to coerced execution (as stated in the tax-related administrative decision and coercive-decision execution expenses calculated by the date of expiration of the time limit of 5 (five) days before the coerced execution is conducted), reason for coerced execution, name, address and state budget revenue account number, mode of transfer of the money amount subject to coerced execution (in cash or account transfer); execution period and signature of the coercive decision issuer or seal of the coercive decision-issuing agency;

b/ A coercive decision shall be sent to the person subject to coercion and related agencies, organizations and individuals within 5 (five) working days from the date of issuance.

3. Written requests for coerced execution

a/ A written request for coerced execution by the measure of revoking a business registration certificate, enterprise registration certificate, establishment and operation license or practice license must have the following principal details: state agency competent to receive the request; information on the individual or organization subject to coerced execution; registered name, tax identification number and address of the business place; type of certificate or license requested to be revoked; information related to the type of certificate or license requested to be revoked (serial number and date of issuance); reason for taking the coerced execution measure (accompanied with copies of dossiers of previous coerced execution measures); time limit within which the agency issuing the business registration certificate, enterprise registration certificate, establishment and operation license or practice license is requested to revoke it;

b/ A written request for coerced execution shall be sent to the organization or individual subject to coerced execution and the competent state management agency for revocation of the business registration certificate, enterprise registration certificate, establishment and operation license or practice license within 3 (three) working days from the date of issuance.

4. Responsibility of an agency competent to revoke a business registration certificate, enterprise registration certificate, establishment and operation license or practice license

Within 10 (ten) working days after receiving a written request for coerced execution from a customs office, a competent state management agency shall notify the customs office of whether it revokes or refuses to revoke a business registration certificate, enterprise registration certificate, establishment and operation license or practice license.

Chapter III

ORGANIZATION OF IMPLEMENTATION

Article 41.Implementation responsibility

1. The General Director of Customs shall organize and direct the handling of administrative violations and coerced execution of customs-related administrative decisions; inspect the observance of law and settlement of complaints in order to ensure the uniform implementation in accordance with law in the entire customs sector.

2. Immediate superiors of persons with sanctioning competence shall inspect the handling of administrative violations by such persons.

Directors of Customs Departments of provinces, inter-provincial regions or centrally run cities, the Director of the Anti-Smuggling Investigation Department, and the Director of the Post-Customs Clearance Inspection Department of the General Department of Customs shall strictly inspect the handling of administrative violations by their units.

Customs branches and control squadrons of Customs Departments of provinces, inter-provincial regions or centrally run cities shall appoint their officers to monitor, instruct and inspect the sanctioning of administrative violations by professional operation teams.

3. Customs officers competent to sanction, apply measures to prevent administrative violations and secure the sanctioning of administrative violations and coerced execution of administrative decisions or tasked to advise persons competent to sanction administrative violations and coerce customs-related administrative decisions who commit violations of regulations, show irresponsibility or harass for bribes or self-seeking purpose shall, depending on the severity of their violations, be strictly handled in accordance with law. If their violations cause material damage, they shall pay compensations in accordance with the law on state compensation liability.

4. Forms of records, decisions and notices used in the course of sanctioning administrative violations, applying measures to prevent administrative violations and securing the handling of administrative violations and coerced execution of customs-related administrative decisions are provided in the Appendix to this Circular. The General Director of Customs shall guide the use of these forms in the entire customs sector.

Article 42.Transitional provisions

1. The sanctioning of administrative violations in the field of customs committed before the effective date of this Circulars must comply with the regulations effective at the time of commission of these violations.

For violations committed before the effective date of this Circular but detected later or being considered for handling, the provisions of this Circular shall be applied to handle them in favor of violators.

2. For decisions on sanctioning of administrative violations issued or completely executed before the effective date of this Circular, about which the sanctioned individuals and organizations file complaints, regulations effective at the time of commission of these violations shall be applied to settle such complaints.

Article 43.Effect

1. This Circular takes effect on December 1, 2016.

To annul the Ministry of Finance’s Circular No. 190/2013/TT-BTC of December 12, 2013, guiding the implementation of the Government’s Decree No. 127/2013/ND-CP of October 15, 2013, on the handling of administrative violations and coerced execution of customs-related administrative decisions.

2. In the course of implementation, if the relevant documents referred to in this Circular and the appendices to this Circular are amended, supplemented or replaced, the amending, supplementing or replacing documents shall be complied with.

3. Any problems arising in the course of implementation should be promptly reported to the Ministry of Finance and General Department of Customs for study and settlement.-

For the Minister of Finance
Deputy Minister
DO HOANG ANH TUAN

* The Appendix to this Circular is not translated.