Circular No. 18/1998/TT-BTM guiding the implementation of Government Decree No. 57/1998/NĐ-CP dated July 31, 1998 on export, import, processing, and agency purchase and sale of goods with foreign countries.

CIRCULAR

Guidelines for implementing Decree No. 57/1998/NĐ-CP dated July 31, 1998 of the Government on export activities,

import, processing, and agency purchase and sale of goods with foreign countries

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To implement Decree No. 57/1998/NĐ-CP dated July 31, 1998 of the Government detailing the implementation of the Commercial Law regarding export, import, processing, and agency sales of goods with foreign countries, the Ministry of Trade guides certain specific issues as follows:

I. ON EXPORT AND IMPORT ACTIVITIES OF GOODS:

1. On the right to engage in export and import business:

a. A trader who is a business entity belonging to various economic sectors, established in accordance with the law, is allowed to export and import goods within the scope of their registered business operations as stated in the Business Registration Certificate after registering the code number at the Customs Office of the province or city in accordance with Clause 3, Article 8 of Decree No. 57/1998/NĐ-CP, without having to apply for a Business License for Export and Import from the Ministry of Trade. Any Business Licenses for Export and Import issued by the Ministry of Trade will cease to be valid from September 1, 1998.

b. For businesses established under the Law on Foreign Investment in Vietnam, export and import activities shall be carried out in accordance with the Law on Foreign Investment in Vietnam and related legal regulations.

2. On exported and imported goods:

a. Goods that can be exported and imported must comply with the business operations recorded in the Business Registration Certificate of the trader, except for those items listed in the Catalogue of Prohibited Export and Import Goods and those temporarily suspended from export and import.

b. As for goods listed in the Catalogue of Conditionally Exported and Imported Goods (goods subject to quotas or permits from the Ministry of Trade or specialized management agencies), traders must obtain allocation of quotas or permits from competent authorities.

c. Prohibited export and import goods are specified in Appendix 1 attached to Decree No. 57/1998/NĐ-CP.

d. Conditionally exported and imported goods as stipulated in Appendix 2 of Decree No. 57/1998/NĐ-CP shall be exported and imported according to annual principles set forth by the Prime Minister.

3. On entrusted export and import:

a. For goods subject to quotas and permits from the Ministry of Trade:

Traders meeting the conditions prescribed in Clause 1, Article 9 of Decree No. 57/1998/NĐ-CP may entrust the export and import of quota-restricted goods and goods requiring permits from the Ministry of Trade within the quantity or value indicated in the quota allocation document issued by the competent authority or the permit issued by the Ministry of Trade.

Traders meeting the conditions prescribed in Clause 2, Article 9 of Decree No. 57/1998/NĐ-CP may accept the entrustment of the export and import of quota-restricted goods and goods requiring permits from the Ministry of Trade within the quantity or value indicated in the quota allocation document issued by the competent authority or the permit issued to the entrusting trader; the accepting trader shall not use their own quota or permit issued by the Ministry of Trade to accept such entrustments.

In cases where the Ministry of Trade has special provisions on the entrustment of the export and import of certain quota-restricted or permitted goods, such entrustment shall be carried out in accordance with those provisions.

b. For goods requiring permits from specialized management agencies:

Traders meeting the conditions prescribed in Clauses 1 and 2 of Article 9 of Decree No. 57/1998/NĐ-CP may entrust or accept the entrustment of the export and import of goods managed by specialized agencies when the entrusting party or the accepting party has a written permit from the specialized management agency allowing the export or import of such goods.

II. ON PROCESSING WITH FOREIGN TRADERS

1. Processing goods with foreign countries.

a. Vietnamese traders belonging to various economic sectors, whether or not they have registered a business code for export and import, are allowed to process goods with foreign traders; they may directly import and export machinery, equipment, raw materials, auxiliary materials, supplies, waste products, scrap materials, and processed products according to processing contracts.

b. For businesses established under the Law on Foreign Investment in Vietnam, processing activities shall be carried out in accordance with the Law on Foreign Investment in Vietnam, related legal regulations, and the provisions of Articles 12, 13, 15, 16, 17, and 18 of Decree No. 57/1998/NĐ-CP.

2. On processing goods listed in the Catalogue of Prohibited Export and Import Goods or temporarily suspended from export and import.

a. Vietnamese traders may only sign processing contracts for goods listed in the Catalogue of Prohibited Export and Import Goods or temporarily suspended from export and import after obtaining written approval from the Ministry of Trade.

b. The dossier submitted to the Ministry of Trade includes:

A request letter from the trader specifying the management measures for processed goods.

A certified copy of the Business Registration Certificate.

3. On raw materials, auxiliary materials, and supplies for processing contracts:

a. For raw materials, auxiliary materials, and supplies purchased domestically:

Raw materials, auxiliary materials, and supplies listed in the Catalogue of Prohibited Export Goods may only be purchased domestically for processing purposes if approved by the Ministry of Trade.

Raw materials, auxiliary materials, and supplies listed in the Catalogue of Conditionally Exported Goods may only be purchased domestically for processing purposes within the quantity or value indicated in the quota allocation document or permit issued by the competent authority.

b. For raw materials, auxiliary materials, and supplies imported:

Raw materials, auxiliary materials, and supplies listed in the Catalogue of Prohibited Import Goods may only be imported for processing purposes if approved by the Ministry of Trade.

4. Payment for processing by processed products.

The party receiving processing services may accept payment from the party commissioning the processing in the form of processed products, but must ensure the following conditions:

a. Processed products do not belong to the Catalogue of Prohibited Import Goods or temporarily suspended from import.

b. If processed products belong to the Catalogue of Conditionally Imported Goods, the party receiving processing services may only accept them within the quantity or value indicated in the quota allocation document or permit issued by the competent authority.

c. Import duties must be paid on the portion of processed products used to settle processing fees.

5. Liquidation of processing contracts:

After the termination of the processing contract, machinery, equipment rented or borrowed under the contract; surplus raw materials, auxiliary materials, spare parts; waste products (collectively referred to as processed materials and goods) shall be handled as follows:

a. The Ministry of Trade:

Shall handle the sale and gift of processed materials and goods listed in the Catalogue of Prohibited Import Commodities, Temporarily Suspended Import Commodities, and Commodities with Conditional Imports.

b. Customs authorities of provinces and cities:

Shall handle the re-export, transfer to other processing contracts, and destruction of processed materials and goods listed in the Catalogue of Prohibited Import Commodities, Temporarily Suspended Import Commodities, and Commodities with Conditional Imports.

Shall handle the sale, gift, re-export, transfer to other processing contracts, and destruction of processed materials and goods not listed in the Catalogue of Prohibited Import Commodities, Temporarily Suspended Import Commodities, and Commodities with Conditional Imports.

III. ON BEHALF OF FOREIGN TRADERS IN THE PURCHASE AND SALE OF GOODS
FOR FOREIGN TRADERS

1. Foreign traders acting as agents for the purchase and sale of goods for foreign entities:

Vietnamese traders with a business registration certificate for the relevant commodity category, whether or not they have registered for a business code for import and export operations, may act as agents for the purchase and sale of goods for foreign traders; they may directly export and import goods according to agency purchase and sale contracts with foreign traders.

2. Acting as agents for the sale of goods to foreign traders:

a. Commodity categories for agency sales:

Vietnamese traders may act as agents for the sale of goods in Vietnam to foreign entities for commodity categories not listed in the Catalogue of Prohibited Import Commodities or Temporarily Suspended Import Commodities.

For commodity categories listed in the Catalogue of Commodities with Conditional Imports, Vietnamese traders may only act as agents for the sale of goods to foreign traders within the quantity or value specified in the quota allocation document or permit issued by the competent authority.

b. Payment for agency sales:

In cases where payment is made in cash, Vietnamese traders must open a dedicated account at a bank for the settlement of agency sales payments in accordance with the guidelines of the State Bank of Vietnam.

In cases where payment is made in commodities listed in the Catalogue of Commodities with Conditional Exports, Vietnamese traders may only export for settlement within the quantity or value of commodities specified in the quota allocation document or permit issued by the competent authority.

3. Acting as agents for the purchase of goods from Vietnam for foreign traders:

a. Vietnamese traders must require foreign traders to transfer convertible foreign currency through a bank and convert it into Vietnamese dong in accordance with Vietnam's foreign exchange management regulations to purchase goods under the agency contract.

b. In cases where the goods belong to the Catalogue of Commodities with Conditional Exports, Vietnamese traders may only purchase goods for foreign traders within the quantity or value of commodities specified in the quota allocation document or permit issued by the competent authority.

IV. PROVISIONS ON IMPLEMENTATION

1. This Circular takes effect from September 1, 1998, and replaces the following documents of the Ministry of Trade:

a. Circular No. 05/1998/TT-BTM dated March 18, 1998, guiding the implementation of Decision No. 55/1998/QĐ-TTg dated March 3, 1998, of the Prime Minister on the Catalogue of Export Commodities Requiring Business Licenses for Import and Export Operations and Related Regulations on Business Licenses for Import and Export Operations.

b. Decision No. 1172 TM/XNK dated September 22, 1994, promulgating the Rules on Entrusted Import and Export between Domestic Legal Entities and Decision No. 38/TM-XNK dated May 6, 1996, amending the aforementioned Rules.

2. The management of exports and imports of conditional commodities during the period from now until March 31, 1999, will still be carried out in accordance with the documents listed in the Appendix attached to this Circular.

3. Abolish previous regulations of the Ministry of Trade on the export, import, processing, and agency of Vietnamese traders with foreign traders that conflict with this Circular.

ANNEX

(Issued together with Circular No. 18/1998/TT-BTM dated August 28, 1998, of the Ministry of Trade)
Decision No. 28/1998/TT-BTM of the Ministry of Trade)

DOCUMENTS ON EXPORT AND IMPORT MANAGEMENT IN 1998
(EFFECTIVE UNTIL MARCH 31, 1999)

1. Decision No. 11/1998/QĐ-TTg dated January 23, 1998, of the Prime Minister on the mechanism for managing exports and imports in 1998.

2. Decision No. 12/1998/QĐ-TTg dated January 23, 1998, of the Prime Minister on the management of rice exports and fertilizer imports in 1998.

3. Decision No. 65/1998/QĐ-TTg dated March 24, 1998, on the export of wood products and forest products and the import of wood and forest product raw materials.

4. Decision No. 136/1998/QĐ-TTg dated July 31, 1998, of the Prime Minister amending certain provisions in Decision No. 65/1998/QĐ-TTg dated March 24, 1998, mentioned above.

5. Circular No. 01/1998/TM-XNK dated February 14, 1998, of the Ministry of Trade guiding the implementation of Decisions No. 11/1998/QĐ-TTg and No. 12/1998/QĐ-TTg both dated January 23, 1998.

6. Circular No. 03/1998/TT-BTM dated February 24, 1998, of the Ministry of Trade guiding the issuance of permits for the import of Cambodian-sourced timber raw materials. Circular No. 06/1998/TT-BTM dated March 26, 1998, of the Ministry of Trade temporarily regulating wine imports in 1998.

7. Circular No. 03/TM-CSTTTN dated March 11, 1997, of the Ministry of Trade guiding the implementation of government regulations on the activities of buying, selling, exporting, importing, and processing precious stones.

8. Other related documents on the mechanism for managing exports and imports./.