Circular No. 11/1999/TT-BTM guiding the implementation of Decision No. 219/1998/QĐ-TTg dated November 12, 1998 of the Prime Minister on the Rules for the Encouraged Economic and Trade Zone of Lao Bao, Quang Tri Province.

CIRCULAR

Guidelines for implementing Decision No. 219/1998/QĐ-TTg dated November 12, 1998 of the Prime Minister promulgating the Regulations on the Economic and Trade Encouragement Zone of Lao Bao, Quang Tri Province.

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Implementing Decision No. 219/1998/QĐ-TTg dated November 12, 1998 of the Prime Minister promulgating the Regulations on the Economic and Trade Encouragement Zone of Lao Bao, Quang Tri Province, hereinafter referred to as the Lao Bao Trade Zone Regulations, the Ministry of Commerce provides guidelines for issues related to trade activities in the Lao Bao Trade Zone as follows:

I. OBJECTS AND SCOPE OF TRADE ACTIVITIES IN THE LAO BAO TRADE ZONE

1.- Objects of trade activities

a. Vietnamese traders belonging to various economic sectors with their main office located in the Lao Bao Trade Zone and branches of Vietnamese traders in the Lao Bao Trade Zone that have been issued a Business Registration Certificate by the Management Board of the Lao Bao Trade Zone, hereinafter referred to as Vietnamese traders in the Lao Bao Trade Zone.

b. Foreign-invested enterprises that have been granted an Investment License by competent authorities to operate in the Lao Bao Trade Zone and branches of foreign-invested enterprises in Vietnam located in the Lao Bao Trade Zone, hereinafter referred to as foreign-invested enterprises in the Lao Bao Trade Zone.

c. Branches of foreign traders that have been granted a license to establish by competent authorities in the Lao Bao Trade Zone according to the provisions of Vietnamese law on branches of foreign traders in Vietnam, hereinafter referred to as branches of foreign traders in the Lao Bao Trade Zone.

The objects of trade activities in the Lao Bao Trade Zone mentioned above in clauses a, b, and c are referred to as enterprises in the Lao Bao Trade Zone.

2.- Scope of trade activities

Enterprises in the Lao Bao Trade Zone shall conduct trade activities in accordance with the provisions of Chapter II of the Commercial Law and Article 3 of the Lao Bao Trade Zone Regulations, specifically as follows:

a. Vietnamese traders in the Lao Bao Trade Zone shall conduct trade activities in accordance with the contents of the Business Registration Certificate and this Circular.

b. Foreign-invested enterprises in the Lao Bao Trade Zone shall conduct trade activities in accordance with the contents of the Investment License and this Circular.

c. Branches of foreign traders in the Lao Bao Trade Zone shall conduct trade activities in accordance with the contents of the Branch Establishment License and this Circular.

II. TRADE ACTIVITIES IN THE LAO BAO TRADE ZONE

1.- Export and import of goods

a. Enterprises in the Lao Bao Trade Zone may export and import goods based on their business needs, except for goods listed in the Prohibited Export and Import List of Vietnam.

b. For goods listed in the Conditional Export and Import List (goods subject to quotas or permits from the Ministry of Commerce or relevant ministries), enterprises in the Lao Bao Trade Zone must be allocated quotas or granted permits by competent authorities.

In cases where goods listed in this category are imported by enterprises in the Lao Bao Trade Zone from domestic Vietnamese enterprises for export abroad, when exporting, enterprises in the Lao Bao Trade Zone must present documentation issued by competent authorities allocating quotas or granting permits to domestic Vietnamese enterprises.

c. Enterprises in the Lao Bao Trade Zone exporting or importing goods that Laos and international regulations do not prohibit but are listed in the Prohibited Export and Import List of Vietnam must obtain permission from the Prime Minister of Vietnam.

d. Vietnamese traders in the Lao Bao Trade Zone may purchase goods from the domestic market of Vietnam for export or for sale in Vietnam and import goods from abroad into the domestic market of Vietnam for business operations in accordance with Vietnamese laws.

e. Foreign-invested enterprises in the Lao Bao Trade Zone may purchase goods from the domestic market of Vietnam for export abroad in accordance with Vietnamese laws applicable to foreign-invested enterprises operating in the domestic market of Vietnam.

g. Branches of foreign traders in the Lao Bao Trade Zone may purchase goods from the domestic market of Vietnam for export abroad and import goods from abroad to sell in the domestic market of Vietnam according to the list of goods permitted for business operations in Vietnam under Vietnamese laws on branches of foreign traders in Vietnam.

h. Enterprises in the Lao Bao Trade Zone and residents of the Lao Bao Trade Zone may purchase goods from the domestic market of Vietnam for use in the Lao Bao Trade Zone to meet daily needs; procedures shall be carried out in accordance with regulations of the General Customs Department.

2.- Temporary import for re-export of goods

a. All enterprises in the Lao Bao Trade Zone are entitled to engage in temporary import for re-export of all types of goods.

Engaging in temporary import for re-export of goods listed in the Prohibited Export and Import List must be approved in writing by the Ministry of Commerce.

b. Temporary import for re-export of goods includes:

- Importing goods from abroad for export abroad, with procedures for importing goods into the Lao Bao Trade Zone and exporting the same goods out of the Lao Bao Trade Zone.

- Importing goods from the domestic market of Vietnam for export abroad or importing goods from abroad for export to the domestic market of Vietnam, with procedures for importing goods into the Lao Bao Trade Zone and exporting the same goods out of the Lao Bao Trade Zone.

c. Temporary import for re-export shall be conducted in accordance with the Regulations on Trading under the Temporary Import for Re-export Method issued together with Decision No. 1311/1998/QĐ-BTM dated October 31, 1998 of the Minister of Commerce, except for the provisions of Article 3, Article 4, and the provisions regarding customs declaration procedures related to these articles in this Regulation.

3.- Transshipment of goods

a. All enterprises in the Lao Bao Trade Zone are entitled to engage in transshipment of all types of goods.

b. Transshipment of goods includes:

- Purchasing goods from abroad to resell to another foreign country without going through import procedures for those goods into the Lao Bao Trade Zone.

- Purchasing goods from abroad to sell domestically in Vietnam without going through import procedures for those goods into the Lao Bao Trade Zone.

- Purchasing goods from domestic Vietnam to resell to a foreign country without going through import procedures for those goods into the Lao Bao Trade Zone.

c. The transshipment business shall be carried out in accordance with the Transshipment Business Regulation issued together with Decision No. 1311/1998/QĐ-BTM dated October 31, 1998 of the Minister of Commerce, except for the provisions of Article 3, Article 4, and the regulations on documents for customs procedures related to the aforementioned articles of this Regulation.

4. Transit of goods through the Lao Bao Trade Zone.

a. Enterprises in the Lao Bao Trade Zone specializing in cargo handling and transportation services may operate transit transportation services for goods passing through the Lao Bao Trade Zone.

b. The transit of goods from abroad through the Lao Bao Trade Zone to exit to another foreign country shall be carried out in accordance with the laws of Vietnam.

c. Goods of domestic Vietnamese enterprises passing through the Lao Bao Trade Zone for export to a foreign country or for import into domestic Vietnam shall go through customs procedures at the first border gate entering the Lao Bao Trade Zone.

5. Processing of goods.

a. Merchants in the Lao Bao Trade Zone are allowed to accept processing orders from abroad, from domestic Vietnam, and to place processing orders in foreign countries or in domestic Vietnam.

b. Processing of goods listed in the Prohibited Export and Import Goods List must comply with the provisions set forth in Section 2, Part II of Circular No. 18/1998/TT-BTM dated August 28, 1998 of the Ministry of Commerce guiding the implementation of Decree No. 57/1998/NĐ-CP dated July 31, 1998 of the Government on export, import, processing, and agency trading activities with foreign countries.

Merchants in the Lao Bao Trade Zone who process goods temporarily suspended from export and import do not need approval in writing from the Ministry of Commerce.

6. Lao Bao Trade Zone Market.

The Lao Bao Trade Zone Market includes the Lao Bao Border Market and the Lao Bao Trade Zone Market.

a. Lao Bao Border Market:

- Subjects eligible to conduct business at the Lao Bao Border Market:

Enterprises in the Lao Bao Trade Zone are permitted by the Lao Bao Border Market Management Board to arrange business locations within the market;

Residents with permanent and temporary residence registration in Huong Hoa District, including the Lao Bao Trade Zone, Quang Tri Province are permitted by the Lao Bao Border Market Management Board to arrange business locations within the market and to register their businesses according to regulations;

Merchants from Sepon District, Savannakhet Province of Laos are permitted by the Lao Bao Border Market Management Board to arrange business locations within the market and are issued a business permit by the Lao Bao Trade Zone Management Board.

- The Lao Bao Trade Zone Management Board is authorized to establish and dissolve the Lao Bao Border Market; establish and dissolve the Lao Bao Border Market Management Board; define the functions and tasks of the Lao Bao Border Market Management Board after reporting and obtaining approval from the Quang Tri Provincial People's Committee in accordance with the Border Market Organization and Management Regulation between Vietnam and Laos issued together with Decision No. 0807/1998/QĐ-BTM dated July 15, 1998 of the Minister of Commerce.

b. Lao Bao Trade Zone Market:

The Lao Bao Trade Zone Market is organized and managed in accordance with Circular No. 15/TM-CSTNTN dated October 16, 1996 of the Ministry of Commerce regarding the organization and management of markets. Specifically, the planning and establishment of markets classified as Type 1 and Type 2, including the decision to establish the Market Management Board, are entrusted to the Lao Bao Trade Zone Management Board.

III. GOODS CIRCULATION IN THE LAO BAO TRADE ZONE AND IMPLEMENTATION OF POLICIES TO ENCOURAGE MOUNTAIN REGION COMMERCE DEVELOPMENT

1. Goods Circulation.

a. Goods within the Lao Bao Trade Zone are freely circulated, except for goods listed in the Prohibited Goods Circulation List and Prohibited Commercial Services List (List 1) issued together with Decree No. 11/1999/NĐ-CP dated March 3, 1999 of the Government.

b. For special restricted goods specified in Section 1 of the Restricted Goods and Commercial Services List (List 2) issued together with Decree No. 11/1999/NĐ-CP dated March 3, 1999 of the Government, enterprises in the Lao Bao Trade Zone can only engage in business after obtaining a Business License from the relevant industry management department.

c. For conditional goods and commercial services specified in Section 1 of the Conditional Goods and Commercial Services List (List 3) issued together with Decree No. 11/1999/NĐ-CP dated March 3, 1999 of the Government, enterprises in the Lao Bao Trade Zone can only engage in business after obtaining a Certificate of Eligibility to Operate from the provincial industry management department.

2. Implementation of policies to encourage mountain region commerce development.

Enterprises in the Lao Bao Trade Zone are entitled to enjoy preferential policies as stipulated in Decree No. 20/1998/NĐ-CP dated March 31, 1998 of the Government on developing mountain and island trade and ethnic minority areas.

IV. IMPLEMENTATION PROVISIONS

This Circular takes effect fifteen days from the date of issuance.