Circular No. 08/2020/TT-BCT stipulates the Rules of Origin for goods under the Vietnam-Cuba Trade Agreement.

 

CIRCULAR

Regulations on Rules of Origin for Goods

in the Vietnam-Cuba Trade Agreement

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Pursuant to Decree No. 9/2016/NĐ-CP dated July 1, 2016 of the Government detailing and guiding the implementation of certain provisions of the Statistics Law;8/2017/NĐ-CP dated January 18 the 8 Article 2. The receipt, handling of reflections and petitions from individuals and organizations concerning administrative regulations shall be carried out in accordance with Decree No. 20/2008/NĐ-CP dated February 14, 2008 of the Government on the receipt, handling of reflections and petitions from individuals and organizations concerning administrative regulations (amended and supplemented by Decree No. 48/2013/NĐ-CP dated May 14, 2013 on amending and supplementing certain articles of decrees related to administrative procedure control and Decree No. 92/2017/NĐ-CP dated August 7, 2017 on amending and supplementing certain articles of decrees related to administrative procedure control).7 /NĐ-CP dated March

Pursuant to Decree No.31/2018/NĐ-CP dated 08 the 3 Pursuant to Decree No. 32/2019/NĐ-CP dated April 10, 2019 of the Government on assigning tasks, procurement or tendering for the supply of products and services using state budget from regular operating expenses;18 of the Government detailing the Law on Foreign Trade Management on the origin of goods; về xuất xứ hàng hóa; ||

Implementing the Agreementon trade between Vietnam and Cuba signed dated 09 the 11 in 2018 at Vietnam;

At the proposal of the Director of the Department of Import-Export;

Chapter I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular stipulates the Rules of Origin for goods under the Vietnam-Cuba Trade Agreement (hereinafter referred to as the Agreement).

Article 2. Applicability

This Circular applies to:

2. Business entities.

3. Authorities, organizations, and individuals related to the origin of exported and imported goods.

3. Authorities, organizations, and individuals related to the origin of exported and imported goods under the Agreement.

Article 3. Explanation of Terms

According to this Circular, the following terms are understood as follows:

1. Change of heading means that raw materials without origin used in the production process must change the HS code at the 4-digit level.

2. "Chapter," "Heading," and "Subheading" refer to Chapters (2 digits), Headings (4 digits), and Subheadings (6 digits) used in the Harmonized System nomenclature, which in this Circular is understood as the "Harmonized System" or "HS."

3. CIF value is the value of imported goods including transportation costs and insurance up to the port or customs frontier of the importing country. This value is calculated according to the Customs Valuation Agreement.

4. "Classified" refers to the classification of goods or materials under specific Chapters, Headings, or Subheadings of the Harmonized System.

5. The competent authority is the body responsible for managing and supervising the implementation of the Agreement's provisions:

a) In Cuba, the Ministry of Industry and Trade and the Ministry of Finance cooperate.

b) In Vietnam, the Ministry of Industry and Trade.

6. Customs authority is the body implementing the laws of each country, responsible for managing and enforcing customs regulations and laws:

a) In Cuba, the General Department of Customs.

b) In Vietnam, the General Department of Vietnam Customs.

7. Day means working day, excluding Saturdays, Sundays, and holidays.

8. FOB value is the value of goods delivered alongside the ship, including freight charges to the port or final destination before the cargo-carrying vessel departs. This value is calculated according to the Customs Valuation Agreement.

9. Similar materials capable of substitution are materials that can be used interchangeably for commercial purposes, having similar basic characteristics and indistinguishable by visual inspection.

10. Goods may have pure origin even when used as raw materials in the production process of other goods.

11. The Harmonized System is an international standardization system for names and codes used in classifying traded goods. This system is developed and maintained by the World Customs Organization.

12. Intermediate material is material used in the production process of subsequent goods and has characteristics allowing it to be sold independently of the final product.

13. Material is raw material, components, intermediate material, and parts used in the production process of goods.

14 Packaging and packing materials for transport are goods used to protect another good during transportation and are not packaging and packing materials containing goods for retail sale.

15. Production is the method of manufacturing goods, including but not limited to planting, breeding, raising, extracting, harvesting, fishing, hunting, aquaculture, gathering, producing, processing, assembling, or disassembling goods.

16. Issuing body is an organization, whether governmental or non-governmental, authorized by the competent authority to issue Certificates of Origin:

a) In Cuba, the Chamber of Commerce and Industry.

b) In Vietnam, authorized bodies and organizations.

17. Set of goods is a product assembled for a specific purpose, packaged for retail sale, and classified according to Rule 3 of the Harmonized System.

Article 4. Regulations on certification and verification of origin certificates for goods

1. The Circular hereby promulgates the following Appendices:

a) Appendix I: Specific rules for products.

b) Appendix II: Sample VN-CU Certificate of Origin (C/O) form.

c) Appendix III: Guidelines for declaring the VN-CU Export Certificate of Origin.

d) Appendix IV: List of agencies and organizations issuing the VN-CU sample Certificate of Origin in Vietnam.

2. The specific product rules stipulated in Appendix II of this Circular include products listed in the tariff schedule under the Agreement.

3. The list of agencies and organizations issuing the VN-CU sample Certificate of Origin in Vietnam is specified in Appendix IV issued together with this Circular and updated in the Electronic System for Management and Issuance of Certificates of Origin operated by the Ministry of Industry and Trade at the website www.ecosys.gov.vn.

4. The process of certification and verification of the origin of goods shall be carried out in accordance with the provisions of Decree No. 31/2018/NĐ-CP dated March 8, 2018 of the Government detailing the Law on Foreign Trade Management regarding the origin of goods and the provisions in related Circulars.

Chapter II

DETERMINATION OF THE ORIGIN OF GOODS

Article 5. Goods with origin

Goods are considered to have origin if they meet one of the following conditions:

1. They have pure origin or are produced entirely within the territory of that Member State.

2. They are produced entirely from materials of origin within the territory of that Member State.

3. They are produced from non-originating materials provided that these materials undergo production processes carried out entirely within the territory of one Member State and the goods are classified in a different heading than the materials.

4. They meet the regional value content (RVC) criterion of not less than X% of the FOB export value of the final goods. This provision applies in cases where the goods do not meet the requirements set forth in Clause 3 of this Article due to the production process not involving a change in heading for all non-originating materials.

5. They are produced entirely within the territory of one Member State from non-originating materials provided that the goods meet the specific criteria set forth in Appendix I issued together with this Circular. This provision applies in cases where the goods do not meet the requirements set forth in Clauses 3 and 4 of this Article.

Article 6. Goods with pure origin

According to Clause 1 of Article 5 of this Circular, goods are considered to have pure origin or are produced entirely within the territory of one or more Member States in one of the following cases:

1. Minerals extracted within the territory of one Member State.

2. Products from plants harvested, picked, or gathered within the territory of one Member State.

3. Live animals born and raised within the territory of one Member State.

4. Products obtained from hunting, trapping, harvesting, farming aquatic species, or fishing within the territory of one Member State.

5. Fish, shellfish, and other marine organisms taken from the sea outside the territory of Member States by vessels owned or registered by companies established within the territory of one Member State, provided that the vessel is registered or has a record filed in one Member State and flies the flag of that Member State.

6. Goods obtained or produced from fish, shellfish, and other marine organisms on vessels owned or registered by companies established within the territory of one Member State and flying the flag of that Member State.

7. Goods obtained from one Member State or from individuals of one Member State from the seabed or subsoil beyond the continental shelf of that Member State, provided that the Member State or individual of that Member State has rights to exploit the seabed or subsoil.

8. Waste and scrap generated during production or collected within the territory of one Member State, provided that such waste and scrap are only suitable as raw material.

9. Goods produced entirely within the territory of one Member State from goods mentioned in Clauses 1 to 8 of this Article or from products derived from them at any stage of production.

Article 7. Aggregation

1. Raw materials of origin from the territory of a Member State used to produce a specific item in the exporting State's territory shall be considered as having origin in the exporting State's territory.

2. When the Member States have a Trade Agreement currently in effect with the same non-Member State, raw materials of that state shall be considered as goods of origin as defined under this Agreement.

3. Paragraph 2 of this Article shall only apply when the Member States agree on the mechanism, procedures, and raw materials used for aggregation of origin.

Article 8. De Minimis

Goods shall be considered as having origin if the CIF value of all non-originating materials used in the production process does not exceed 10% of the FOB value of the goods according to the rule of change in tariff classification.

Article 9. Intermediate Materials

To determine the origin of goods, for cases specified in Clause 4 of Article 5 of this Circular, the manufacturer may consider the total value of intermediate goods used to produce the goods of origin provided that the intermediate goods meet the conditions stipulated in this Circular.

Article 10. Simple Processing Operations

1. The processing operations described below shall be considered simple processing operations and shall not be taken into account when determining the origin of goods:

a) Ensuring the preservation of goods in good condition for transportation or storage.

b) Facilitating transportation or delivery.

c) Packaging or displaying goods for sale.

2. Goods of origin from the territory of a Member State retain their original origin when exported from another Member State if the processing operations do not exceed those specified in Clause 1 of this Article.

Article 11. Accessories, Spare Parts, and Tools

1. Accessories, spare parts, and tools accompanying a product shall be considered part of the goods when issued on the same invoice with the goods and are a usual component of the goods. Accessories, spare parts, and tools shall not be taken into account in determining all non-originating materials used in the production process of goods undergoing a change in tariff classification.

2. If the origin of goods is determined based on the RVC criterion, the value of accessories, spare parts, and tools as stipulated in Clause 1 of this Article shall be considered as originating or non-originating when calculating the RVC.

Article 12. Sets of Goods

1. A set of goods as defined in Rule 3 of the General Rules of Interpretation of the Harmonized System and goods described in the Harmonized System shall be considered as having origin if all constituent goods have origin.

2. In the case where a set of goods consists of both originating and non-originating goods, the set of goods shall be considered as having origin if the CIF value of the non-originating goods does not exceed 15% of the FOB value of the set of goods.

Article 13. Packing Materials and Retail Packaging

1. In the case where the origin of goods is determined based on the RVC criterion, the value of packing materials and retail packaging shall be taken into account when determining the origin, as packing materials and retail packaging are considered components constituting the entire goods.

2. In the case where the origin of goods is determined based on the change in tariff classification criterion, packing materials and retail packaging classified together with the packaged goods do not need to meet the change in tariff classification criterion.

Article 14. Packaging materials and packaging for transportation

Packaging materials and packaging for transportation shall not be taken into account when determining the origin of goods.

Article 15. Intermediate factors and indirect raw materials used in production

The following intermediate factors and indirect raw materials used in the production process shall not be taken into account in the determination of origin:

1. Fuel and energy.

2. Tools, molds, and dies. Spare parts and supplies used to maintain machines, equipment, and facilities.

3. Lubricants, greases, bonding materials, and other materials used in production or used to operate equipment and facilities.

4. Gloves, goggles, footwear, clothing, safety equipment, and supplies.

5. Equipment and supplies used for inspection and testing of goods.

6. Catalysts and solvents.

7. Any other material that does not constitute or is not part of the final product of the goods and can be proven to be part of the production process.

Article 16. Similar Raw Materials and Substitutable Raw Materials

1. The determination of the origin of similar raw materials and substitutable raw materials shall be carried out by separating each material or by using inventory accounting principles or warehouse management practices of the Exporting Country.

2. Once a decision on the method of inventory management has been made, such method shall be consistently applied throughout the fiscal year.

Article 17. Direct Transportation

1. Goods with origin shall be considered to have been directly transported from the Exporting Country to the Importing Country under one of the following circumstances:

a) Goods are transported without passing through the territory of a Non-Member Country.

b) Goods are transported for transit through a Non-Member Country including or excluding transshipment or temporary storage there, subject to the following conditions: - Transit due to geographical reasons, handover, or transport requirements. - Goods do not participate in commercial transactions or consumption within the territory of the Non-Member Country. - Goods do not undergo any production or processing stages in the territory of the Non-Member Country, except for unloading, reloading, and splitting shipments or other necessary steps to preserve the goods in good condition.

2. In cases where goods with origin from the Exporting Country are imported via one or more Non-Member Countries or after being exhibited in a Non-Member Country, the customs authority of the Importing Country may require the importer to submit supporting documents such as transport documents, customs documents, or other relevant documents.

Article 18. Goods Stored in Bonded Warehouses

1. Goods with a Certificate of Origin shall retain their original origin if they remain stored in a third country's bonded warehouse during transportation and do not undergo any additional processing stages other than warehousing, preservation, splitting shipments for transportation to Member Countries, and remaining under the supervision of the customs authority.

2. The customs authority of the Importing Country may request confirmation that the goods have not undergone any changes.

Article 19. Exhibited Goods

Goods of origin transported from one Member State to a third country for exhibition or display and sale after or during the exhibition, then imported into another Member State, shall be entitled to preferential customs duties when they comply with the provisions of this Circular and accompanied by customs documents proving the display or exhibition of the goods.

Chapter III

 PROCEDURE FOR CERTIFICATION AND VERIFICATION OF ORIGIN OF GOODS

Article 20. Certificate of Origin

1. The Certificate of Origin is the sole document certifying that goods meet the origin requirements set forth in this Circular and is used to request preferential tariffs under the Agreement.

2. The Certificate of Origin specified in Clause 1 of this Article shall be issued according to the form prescribed in Appendix II attached to this Circular. One Certificate of Origin shall be issued for one consignment.

Article 21. Validity of the Certificate of Origin

1. The Certificate of Origin must be issued within three days from the date of export as stipulated in Article 20 and remains valid for one year from the date of issuance. The Certificate of Origin is invalid if the declared information is not fully and correctly reported.

2. The Certificate of Origin must bear the name, signature, and stamp of the competent authority.

3. The Certificate of Origin may not be issued before, but can be issued on the same day or after the issuance of the commercial invoice.

Article 22. Record Keeping

The issuing authority, organization, and trader must retain records and documents proving the origin of goods, including the Certificate of Origin, for at least five years from the date of issuance in writing or electronically as prescribed by Vietnamese law.

Article 23. Third Country Invoice

In cases where goods of origin have a commercial invoice issued by the exporter registered in a third country, the Certificate of Origin must declare "Non-party invoicing."

Article 24. Issuance of the Certificate of Origin

Upon request of the competent authority, the exporter requesting the issuance of the Certificate of Origin must submit proof of origin and comply with the provisions of this Circular.

Article 25. Application Package for Issuance of the Certificate of Origin

The application package for the issuance of the Certificate of Origin must include the exporter's request form and documents proving compliance with the provisions of this Circular and related regulations.

Article 26. Refusal of Preferential Treatment

The importing country may refuse preferential treatment if the goods do not meet the requirements and deadlines set forth in this Circular.

Article 27. Amendment of Issued C/O

An issued C/O may not be erased or added to. Any changes must be made by:

1. Striking out incorrect entries and supplementing necessary information. These changes must be approved by the authorized person who signed the C/O and confirmed by the issuing authority or organization. Blank spaces must be crossed out to prevent additional entries.

2. Issuing a new C/O to replace the original erroneous C/O. The new C/O must bear the reference number and issuance date of the original C/O. The new C/O must clearly state "replaces C/O No... date of issue...". The new C/O becomes effective from the issuance date of the original C/O.

Article 28. Issuing Certified True Copies of C/O

In case the C/O is stolen, lost, or damaged, the Exporting Country may request the issuing authority to issue a certified true copy. The copy shall be marked "CERTIFIED TRUE COPY" and bear the date of issuance of the original C/O, which remains valid for one year from the date of issuance of the original C/O.

Article 29. Verification of Origin and Granting of Preferential Treatment

1. In addition to requesting the presentation of the Certificate of Origin in accordance with this Circular, the customs authority of the Importing Country may request information from the competent authority of the Exporting Country for the purpose of verifying the origin of goods. The Importing Country has the right to refuse preferential treatment if it does not receive a notification from the customs authority of the Exporting Country confirming receipt of the verification request within ninety days from the date of issuance of the verification request. The Exporting Country must respond with the results of the origin verification within one hundred eighty days from the date of receipt of the verification request.

2. The notification of the verification request issued by the customs authority of the Importing Country shall include the following contents:

a) Name of the requesting authority.

b) Reference number and date of issuance of the C/O or the quantity of C/Os issued to the exporter within a specific period.

c) Description of the verification request.

d) Reason for the request.

3. In cases where the information obtained from the verification process under Clause 1 and 2 of this Article is insufficient to verify the origin of goods, the customs authority of the Importing Country, through the competent authority of the Exporting Country, shall issue:

a) A document requesting information from the exporter or manufacturer.

b) A questionnaire for the importer, exporter, or manufacturer.

c) A request for on-site verification at the production facility of the exporter or manufacturer located in each Party's territory, with the aim of reviewing additional documentation or verifying the production facilities, when the information obtained from points a and b of Clause 3 of this Article is incomplete.

d) Other procedures agreed upon by both Parties.

4. The customs authority of the Importing Country shall notify the importer, exporter, or manufacturer and the competent authority of the Exporting Country of the verification request pursuant to Clause 3 of this Article. The notification shall be sent via email or any other means; the recipient shall confirm receipt of the verification request.

5. The document requesting information or questionnaire mentioned in point a and point b of Clause 3 of this Article shall include the following contents:

a) Name of the requesting authority.

b) Name of the importer, exporter, and manufacturer requested for verification.

c) Description of the requested information and documents.

d) Reason for the verification request or questionnaire.

6. The importer, exporter, or manufacturer receiving the questionnaire or document requesting information pursuant to point a and point b of Clause 3 of this Article must complete and return the questionnaire or verification response within forty-five days from the date of receipt of the document.

7. The on-site verification request mentioned in point c of Clause 3 of this Article shall include the following information:

a) Name of the customs authority making the verification request.

b) Name of the exporter or manufacturer whose origin is to be verified at the production facility.

c) Date and location of the on-site verification as stipulated in Clause 8 of this Article.

d) Purpose and scope of the verification, specifying the goods to be verified at the production facility.

đ) Name and position of the staff conducting the on-site verification.

e) Reason for the on-site verification.

8. The competent authority of the Exporting Country shall reply to the customs authority of the Importing Country regarding approval of the on-site verification within thirty days from the date of receipt of the request. On-site verification can be conducted sixty days after approval.

9. The exporter or manufacturer may submit a written request to the competent authority of the Exporting and Importing Countries to temporarily suspend on-site verification due to compelling reasons. The suspension period shall not exceed thirty days from the agreed date or a longer period approved by the customs authorities of both countries. The customs authority of the Importing Country shall notify the new schedule for on-site verification at the exporter or manufacturer's production facility.

10. Upon completion of on-site verification, the customs authority of the Importing Country shall draft a verification report including the facts and results of the on-site verification. The verification report shall be signed by the competent authority of the Importing Country, the exporter, and the manufacturer.

11. The verification process is completed when the customs authority of the Importing Country reports the conclusion on the origin of goods after verification, within thirty days from the date of receipt of the information or completion of on-site verification.

12. The verification report shall include the facts, findings, legal basis for on-site verification, and shall inform the importer, exporter, or manufacturer whether the goods have origin.

13. Goods subject to origin verification shall enjoy preferential treatment in the following circumstances:

a) If the deadline specified in Clause 11 of this Article expires without a verification report provided by the customs authority of the Importing Country; or

b) If the Importing Country fails to comply with the deadlines set forth in this Article.

14. In cases where the customs authority of the Importing Country has reasonable grounds to suspect the origin of a consignment, the customs authority may temporarily withhold preferential treatment for that consignment. The goods shall be cleared according to the regulations of the Importing Country. The party discovering the suspicion shall notify and consult the other party to reach a mutually satisfactory solution ensuring financial interests.

Article 30. Responsibilities of Exporters

1. When an exporter has reasons to believe that the Certificate of Origin (C/O) contains inaccurate information, the exporter must immediately notify in writing to the issuing authority or organization all contents that may affect the accuracy or validity of such C/O.

2. The exporter shall not be penalized for providing inaccurate information if they voluntarily notify in writing to the competent authority before the customs authority of the Importing State grants preferential tariff treatment or conducts origin verification at the production facility.

Article 31. Responsibilities of Importers

The customs authority of each Party shall require importers seeking preferential tariff treatment for goods to:

1. Declare in writing in the import declaration according to the provisions of the law based on the Certificate of Origin that the goods have origin.

2. Submit the Certificate of Origin at the time of declaration as stipulated in Clause 1 of this Article, if required by the laws of the Importing State.

3. Immediately submit the corrected declaration form and pay the difference in tax when the importer has reasons to believe that the information declared on the import declaration based on the Certificate of Origin is inaccurate.

Article 32. Refund of Tax

In cases where imported goods have origin but did not receive preferential tariff treatment at the time of importation, the importer may apply to the customs authority of the Importing State for a refund of the paid tax based on the current Vietnamese laws, upon providing:

1. A written declaration stating that the goods met the origin requirements at the time of importation.

2. The Certificate of Origin.

3. Other relevant documents related to the importation of goods as requested by the Importing State.

Article 33. Minor Differences on the C/O

1. The customs authority of the Importing State will not consider minor errors such as slight discrepancies, omissions, typographical errors, or information spilling over the declaration box, provided that these minor errors do not affect the authenticity of the C/O, the accuracy of the information provided on the C/O, or the origin status of the certified goods.

2. For C/Os declaring multiple goods, issues with one of the listed goods shall not affect or delay preferential tariff treatment for the remaining goods on the C/O.

Article 34. Confidentiality

The competent authorities of Vietnam, in accordance with the law, shall maintain confidentiality of the information provided in accordance with this Circular. Information shall not be disclosed without the permission of the individual or competent authority providing it.

Chapter IV

IMPLEMENTATION PROVISIONS

Article 35. Issuance of C/O for Goods Exported Before the Effective Date of the Circular

The issuing authority or organization shall consider issuing the VN-CU model C/O for Vietnamese goods exported before the effective date of this Circular to enjoy preferential tariff treatment under the Agreement and the laws of the Importing State.

Article 36. Implementation and Effectiveness

1. The guidelines and uniform understanding regarding the implementation of the Rules of Origin are established through periodic reports from the Working Group on Rules of Origin and the Joint Committee within the framework of implementing the Vietnam-Cuba Trade Agreement, which serve as the basis for the issuing authorities and customs authorities to follow.

2. The contents specified in Clause 1 of this Article shall be communicated to the issuing authorities and customs authorities through the focal point of the Working Group on Rules of Origin and the Joint Committee implementing the Vietnam-Cuba Trade Agreement.

3. This Circular takes effect from May 25, 2020.