The Hanoitimes - Vietnam’s exporters must self-verify the origin of their products that they export to the European Union (EU) from 2019 to be qualified for Generalised System of Preferences (GSP) which is the tariff preference for developing countries.
With the aim of integrating further into the global economy, Vietnam has joined many free trade agreements (FTAs) that have the self-certification mechanism of origin.
Self-certification of origin is a mandatory requirement of the EU for some countries, including Vietnam.
The Import and Export Department under the Ministry of Industry and Trade said under the requirement, the responsibility for verifying product origin will be shifted from authorities to enterprises or exporters.
Vietnamese exporters to self-verify products origin
Enterprises will have to perform all the steps themselves, meeting the requirements of product origin and be accountable for their accuracy.
At the same time, it reduces the risk of licensing authorities and minimises the burden on customs.
According to trade experts, this mechanism offers many benefits in terms of reducing time and cost of transaction, actively issuing commercial invoices, and helping businesses to know commitment on rules of origin in the FTA.
Vietnam currently has 2,700 Vietnamese enterprises exporting to the EU that enjoy the benefits of GSP and it will be quite a rush to force enterprises with self-certification of origin from early 2019, according to the ministry.
The only difference is that instead of the authorities, the enterprise will issue its own C/O by including the line “this product is qualified for GSP” in their document and invoice.
Enterprises becoming self-certifying exporters shows the trust of government agencies in businesses, in compliance with Vietnam’s commitment to the FTA, said Tran Thanh Hai, Deputy Director of the Export and Import Department.
Vietnamese businesses will have around six months of transition time to reduce the burden on them. During this time, if enterprises are unable to self-verify the origin of their products, they can apply for certification of origin from the Vietnam Chamber of Commerce and Industry (VCCI) and the Ministry of Industry and Trade as usual.
The ministry will still train, instruct and remain a place for business registry. In case any issue arises in the trading process, the agency will have information to collaborate with the EU to determine the source of goods and enterprises.
When businesses self-certify the origin of their products, they are acting on the government’s behalf.
Experts said that if businesses do not comprehend the mechanism and the necessary requirements that can result in false certification, the outcome would not only affect the businesses but also to the whole nation.
Hai said the ministry would assist enterprises by organising seminars that would provide information on the self-certification mechanism of origin and the training courses for enterprises in self-certifying the origin of goods.
At present, the ministry has concentrated on developing a circular guiding enterprises to self-certify the origin of goods exported to the EU. After the issuance of the circular, the ministry will cooperate with the VCCI, the associations and branches as well as the enterprises to provide training courses and guidance that would help them certify their origin quickly and accurately.