Decision No. 456/QD-BTC On the issuance of the "Plan for Reform, Development, and Modernization of the Customs Sector from 2008 to 2010"

Pursuant to …;

Regarding the issuance of "the plan for reform, development, and modernization of the Customs sector from 2008 to 2010"

THE MINISTER OF FINANCE

Pursuant to the Law on Customs dated June 29, 2001 and the Law Amending and Supplementing Certain Provisions of the Law on Customs dated June 14, 2005;
Pursuant to Decree No. 178/2007/ND-CP dated December 3, 2007 of the Government stipulating the functions, tasks, powers, and organizational structure of Ministries and ministerial-level agencies;
Pursuant to Decree No. 77/2003/NĐ-CP dated July 1, 2003 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;
At the proposal of the Director General of the General Department of Customs;

DECISION:

Article 1. This Decision promulgates the Plan for Reform, Development, and Modernization of the Customs Sector from 2008 to 2010 attached hereto.

Article 2. The Director of the Financial Management Department shall coordinate with the General Director of the General Department of Customs to submit the budget estimate and resources necessary for implementing this Plan to the Ministry for approval.

Article 3. This Decision shall take effect from the date of signing.

Article 4. The Heads of the Ministry's Office, the General Department of Customs, and other units under the Ministry are responsible for enforcing this Decision.

PLAN

REFORM, DEVELOPMENT AND MODERNIZATION OF THE CUSTOMS SECTOR FROM 2008 TO 2010
(Issued together with Decision No. 456/QD-BTC dated March 14, 2008 of the Minister of Finance)

I. RESULTS OF IMPLEMENTING THE PLAN FOR REFORM, DEVELOPMENT AND MODERNIZATION OF THE CUSTOMS SECTOR FROM 2004 TO 2007

1. Overall assessment of results in implementing the reform, development, and modernization of customs from 2004 to 2007

To ensure scientific state management of customs, meeting international integration requirements and administrative reform, the Customs sector needs to change its activities in new circumstances. Following the directives of the Ministry of Finance, the General Department of Customs has developed the Plan for Reform, Development, and Modernization of the Customs Sector from 2004 to 2006. On March 16, 2004, the Minister of Finance issued Decision No. 810/QD-BTC regarding the "Plan for Reform, Development, and Modernization of the Customs Sector from 2004 to 2006" (hereinafter referred to as Plan 810).

Through the implementation of Plan 810, the Customs sector achieved several notable results as follows:

- The awareness of customs officers throughout the sector regarding customs modernization has fundamentally changed;

- The legal framework for customs operations has been improved, gradually aligning with international standards and practices through the drafting and submission of amendments to the Law on Customs 2005; the submission of decrees and circulars guiding specific provisions to the Government and the Ministry of Finance. Many international customs standards and practices have been incorporated into customs laws, creating a legal basis for the Customs sector to implement new modern customs management regulations, particularly the pilot implementation of electronic customs procedures;

- Customs management methods have been reformed from pre-inspection to post-inspection. Customs procedures have largely been simplified and harmonized based on risk management methods and the application of information technology (IT), while simultaneously promoting post-clearance inspections. Customs procedures have become clear, effective, and responsibilities have been clearly defined for each business process and individual officer;

- The application of IT has also been strengthened, during this period the Customs sector piloted electronic customs procedures, widely applied remote customs declarations; developed and upgraded many IT programs to support the implementation of the amended Law on Customs and the amended Law on Export Duties and Import Duties; invested in building customs office premises, equipment, IT infrastructure, and networks, especially in key areas to quickly and effectively implement the amended Law on Customs and new customs procedures;

- The organizational system within the sector was improved to serve the implementation of procedures according to the amended Law on Customs, the amended Law on Export Duties and Import Duties, and the Law on Tax Administration. Established and consolidated the organizational structure of the post-clearance inspection system at 33 provincial and city customs offices and the system for collecting, processing, and analyzing information for risk management throughout the sector. A notable achievement in this phase was the implementation of the organizational model project for piloting electronic customs procedures at two Electronic Customs Branches under the Hai Phong Customs Department and the Ho Chi Minh City Customs Department;

- Annual revenue into the State budget exceeded the assigned targets;

- Risk management (RMM) methods were applied in some customs business processes, thus reducing the actual inspection rate of goods to only 20-25%, and shortening the clearance time for goods;

- Through the implementation of customs modernization projects, most leaders at all levels of Customs have approached and applied modern customs management methods. A team has been formed to assist the General Department in directing, coordinating, organizing the implementation of reforms, modernization, and managing projects more effectively.

In 2007, one of the key tasks of the Customs Sector was to implement the second phase of electronic customs procedures and remote customs declaration. The Customs Sector focused on piloting the second phase at the Hai Phong Customs Department and Ho Chi Minh City Customs Department, initially achieving some results, receiving attention and support from public opinion, especially the business community, preparing conditions to ensure the pilot implementation of electronic customs procedures at other Customs Departments, and implementing the Modernization of Customs Project funded by the World Bank, including tender packages such as Training Strategy, Customs Statistics, Human Resource Management, Exception Intervention, and Legal Framework. The contents and outcomes of these tender packages were introduced through international seminars and were initially evaluated as practical for reform and modernization requirements, serving as a lever to influence awareness when implementing work towards modernization. The contents of the program of the EU Technical Assistance Project for the Government of Vietnam (ETV2), Customs Component, were implemented according to schedule and requirements; negotiations with Japan regarding the Regional Cooperation Project on Risk Management in the Customs Field for the period 2008-2010 and the Japanese Government's Non-Reimbursable Aid Project for Container Inspection Systems using X-ray Machines at major ports were also conducted.

To fulfill the tasks of reform and modernization, in the short term and long term, the Customs Sector has established a unified organizational system to implement modernization work from the General Department to provincial and city Customs Departments and within units under the General Department.

At the General Department level, the Ministry of Finance established the Reform and Modernization Customs Steering Committee, and the Director of the General Department of Customs issued Decision No. 831/QD-TCHQ dated May 10, 2007, stipulating the functions and responsibilities of the Working Groups under the Reform and Modernization Customs Steering Committee. Through reorganization, the work of organizing and directing reform and modernization in the Sector has formed a team of specialized staff responsible for modernization, utilizing resources from the General Department to provincial and city Customs Departments; ensuring the establishment of a specialized unit to research new issues, linked to the organization and implementation throughout the Sector.

In summary, the period of customs reform and modernization from 2004 to 2007 was a comprehensive preparation for subsequent phases of the Sector's reform and modernization program, setting up necessary conditions in terms of institutional framework, human resources, procedural processes, equipment, etc., for the Customs Sector to continue its reform and modernization efforts.

According to the general goal of Plan 810, completing the reform and transformation of customs operations according to modern customs standards, meeting international integration requirements in customs, laying the groundwork for further customs reform and modernization according to strategic goals until 2010; fully automating customs procedures for export goods, piloting automation of customs procedures for import goods... The achievement of this general goal has not met the set targets, specifically: the reform and transformation of customs operations according to modern customs standards, this target has only been completed in some aspects, while there are still some shortcomings such as the related legal system for import and export goods has not been fully and synchronously perfected by relevant agencies; the electronic customs procedures proposed in Plan 810 were only piloted for exports but during implementation, it was also piloted for both exports and imports at two Electronic Customs Branches (Hai Phong Customs Department, Ho Chi Minh City Customs Department).

2. Results of Implementing the Objectives of the Five Programs for Reform, Development, and Modernization of the Customs Sector from 2004 to 2007

2.1. Institutional Reform Program

The General Department of Customs studied and submitted to competent authorities for promulgation the Law Amending and Supplementing Certain Provisions of the Customs Law. The Customs Law of 2001 and the Law Amending and Supplementing Certain Provisions of the Customs Law of 2005 have created a legal basis for the Customs Sector to continue reform and modernization; approaching and establishing a legal framework for modern customs management models, serving as a foundation for applying risk management techniques in customs activities and domesticating many international commitments related to customs activities.

Additionally, the General Department of Customs directly participated in the development and amendment of the Export Tax Law, Import Tax Law, Tax Administration Law, and related Decrees and Circulars guiding customs activities. Simultaneously, the General Department of Customs took the lead in drafting and submitting to competent authorities for promulgation regulatory legal documents such as Decision No. 149/2005/QD-TTg dated June 20, 2005 of the Prime Minister on piloting electronic customs procedures; Decision No. 50/2005/QD-BTC dated July 19, 2005 of the Minister of Finance on piloting electronic customs procedures (Phase 1); Decision No. 52/2007/QD-BTC dated June 22, 2007 of the Minister of Finance on piloting electronic customs procedures (Phase 2).

Electronic customs procedures have achieved some initial successes, significantly reducing the time to process customs documents (from 7-8 hours down to 10-15 minutes) and no longer requiring immediate submission of various types of documents to customs authorities. Initially transitioning to modern customs management methods from transaction-based management to enterprise-based management, from paper-based processing to electronic data processing; forming a cadre working in a new environment. Enterprises have gradually been supported to familiarize themselves with electronic customs procedures and received timely guidance on any difficulties either at their own units or online.

In addition to the achievements, the institutional reform program still has the following shortcomings: the legal system on customs is not yet complete and consistent; some documents issued to address urgent situations have not foreseen issues arising during implementation, especially some guiding documents for the Customs Law and its implementation have been delayed such as the procedures for managing customs business for imported goods for re-export, export processing enterprises, free trade zones, bonded warehouses, customs supervision...; the contents of some documents related to customs activities are contradictory and overlapping; some documents have not been developed and issued according to the plan, such as: the Decree stipulating the functions, tasks, and organizational structure of the General Department of Customs (to be completed at the beginning of Q4/2005); the Decree stipulating the scope of customs operations (to be completed at the beginning of Q4/2005); providing legal advisory services to partners; systematizing legal documents on customs to build a database of customs laws; assessing the current status of the customs legal system and proposing amendments in line with international standards have also not been completed on schedule.

2.2. The modernization program for information technology

To serve the pilot customs electronic procedures for exported and imported goods, the Customs sector has built and applied an electronic clearance system to implement the transmission and processing of information.

Along with purchasing equipment and software to support work, the Customs sector has prepared the infrastructure for communication to ensure connectivity between customs units and the General Department.

- Many software applications supporting basic customs management tasks such as declaration management, registration acceptance, valuation management, tax management... have been developed and upgraded.

- Investment in new computers and IT equipment;

- Building and effectively using the Net.office document management and processing program at the General Department, and in early 2006, the network was extended to provincial Customs Bureaus, contributing to promoting administrative reform in daily guidance activities from the General Department to subordinate units.

- Completing the General Department of Customs website to update and disseminate key policy regulations, rules, and information related to customs management activities to facilitate businesses.

Training and enhancing knowledge about information technology for officials has been emphasized, with a large number of staff being trained directly on operational chains to manage and operate IT systems, ensuring they are proficient in using the programs necessary for their work. These results have contributed to raising awareness about the importance of modernization reforms and the application of information technology in customs management...

However, the implementation of IT programs still reveals several inadequacies: software programs for each group of customs business tasks are not compatible with each other and difficult to integrate for new management models; the automation program for piloting customs electronic procedures is hesitant in implementation, facing difficulties in network connection with partners and relevant agencies; the network infrastructure is unstable, failing to meet management requirements and ensuring security; due to dispersed investment in machinery, equipment, and software, costs are high, making management, maintenance, and upgrades challenging; the implementation of electronic customs procedures is slow, with low levels of automation...; software and data for risk management have many limitations.

2.3. The organizational restructuring program

The General Department of Customs has conducted surveys and assessments of the current situation and operation, coordination within the organizational structure of each Bureau and Branch to refine the customs network planning as a basis for adjusting and rearranging the organizational structure according to the requirements of new procedures and modern customs management. This activity also aims to implement an organizational model serving electronic customs procedures, improve the organizational structure of post-clearance inspection systems, and arrange the anti-drug organization system in key areas.

However, the achievements mentioned above mainly involve follow-up activities to address issues arising from changes in business operations. The modernization reform plan has identified certain tasks that need to be studied and developed beforehand to establish scientific grounds for reform, such as: summarizing and evaluating the entire activities of units under the General Department of Customs and proposing amendments to Government Decree No. 96/2002/NĐ-CP dated November 19, 2002, stipulating the functions, tasks, and organizational structure of the General Department of Customs; developing a proposal for the organizational model of customs based on business processes; and a proposal for re-planning the customs branch network has not been organized and implemented.

2.4. The standardization and training program for cadres

Initial steps have been taken to survey and assess the cadre workforce throughout the sector, thereby identifying training needs and developing plans to train and enhance the skills of cadres and civil servants with high professional expertise, initially aiming towards professionalism, with a civilized and courteous service spirit, discipline, honesty. To achieve standardized cadre recruitment from the outset, in line with modernization requirements, the recruitment of new civil servants has focused on matching educational majors with job requirements and good moral qualities.

The development of curricula and materials is closely tied to practical business operations and has been assigned to relevant units to draft in conjunction with referencing modern customs training curricula. Regular training courses are organized at the General Department and local Customs Bureaus for various categories of civil servants to update and enhance their knowledge of customs laws, specialized business operations, in-depth expertise, as well as supplementary knowledge.

Alongside the implementation of training through internal resources, the General Department of Customs has also leveraged external technical support sources such as the World Customs Organization (WCO), ASEAN Customs, APEC Customs, and other countries' customs. Within the framework of the project to strengthen the capacity of key instructors serving modernization, with the assistance of the Japan International Cooperation Agency (JICA), many Vietnamese customs officials have been trained in basic skills to become key instructors in three areas of business operations: classification of goods, customs value, and post-clearance audit. Simultaneously, the Customs sector has begun to describe job titles down to each unit under and directly affiliated with the General Department of Customs.

However, standardizing the cadre and training according to the targets set out in the plan still lacks many unachieved contents. Many goals set exceed the ability to implement, there are some goals that can be fully implemented and are important in organizational execution but have not yet been organized and implemented, such as determining the cadre structure linked to each job title; completing and perfecting curricula and materials for each type of training and retraining; building a teaching staff; developing an appropriate training model to replace the Customs College. Regarding the program to reform the organizational structure: the goal "by 2006, the management system of the Bureau and Border Gate Customs Sub-departments in key units and regions will operate according to a centralized management model for electronic clearance of export goods, and piloting for import goods"; some activities of this component have not been implemented. Regarding the program to standardize training cadres: the goal "strive to reach the end of 2006, over 80% of enforcement civil servants and over 90% of leadership cadres meet the standards of civil servant ranks, leadership positions, and in-depth customs business expertise in each field, basically meeting international integration requirements in customs". This goal has not been achieved, some activities of this content are currently being implemented such as standardizing job title standards, in-depth training...

2.5. Investment Program for Equipment and Construction of Headquarters

The entire sector has focused on investing in equipment, machinery, IT, network infrastructure, especially in key areas based on ensuring centralized management requirements and the implementation of IT application programs. Surveys and evaluations of current usage, determination of needs, and effectiveness of equipment usage by all units in the sector have been conducted, leading to the reallocation and rearrangement of existing equipment, and the purchase of new equipment to serve the sector's business activities, avoiding waste, practicing thrift, and maximizing the value of machinery and equipment. From 2004 to 2007, significant investments were made in modern equipment and machinery to meet the requirements of implementing the amended Customs Law, quickly, effectively, and civilly. Specifically:

- Concentrating on reviewing and promoting investment in baggage scanners; surveillance camera systems; truck scales; communication systems; equipment for analyzing and classifying imported and exported goods according to the roadmap and plan;

- Developing an investment strategy and planning for basic construction investment to serve the reform and modernization of the Customs sector until 2010. New construction and repair of many Bureau and Sub-department facilities have been carried out, ensuring a decent and civilized workplace and living conditions for Customs officials. The construction of a new headquarters for the General Department of Customs is currently underway.

The results of these programs have not fully reflected the objectives set out in Plan 810. Many objectives have not been achieved, such as modernizing headquarters; investing in container scanning systems; surveillance cameras; centralized inspection locations; equipment for customs officers... In particular, when implementing this program, it was found that the planning and standardization work was not close to reality, thus causing confusion and inefficiency when organizing implementation. Regarding technical equipment, the addition of scanners as planned ("equipping international seaports, airports, and land border gates where installation locations have been determined (expected 53 units)") has not been achieved. For the basic construction investment program, the goal of having a modern infrastructure and technical equipment, and maximizing IT applications by 2006 has not been achieved, although some main activities have been initiated but are behind schedule, such as Building 15B Thi Sach (Ho Chi Minh City), the General Department's headquarters, the Service Dog Training Center (Control and Anti-Smuggling Bureau); the headquarters of the Northern Import and Export Goods Classification Analysis Center...

2.6. Evaluation of the Disbursement Progress of the 2004-2006 Plan

Issues:

- Some objectives have not been achieved, such as modernizing working headquarters; equipping container scanning systems; surveillance cameras; centralized customs inspection locations...

- The actual budget allocation only reached 42.27% (Allocated budget 930.968.0 tr/VND/Plan 2,202,367.0 tr/VND).

Reasons:

- Compared to the allocated budget, the disbursement progress achieved is 82.55% (768,484.0 tr/VND/930,968.0 tr/VND).

- The allocated budget is lower than the planned budget due to limitations in the quality of planning work. Many contents related to reform, development, and modernization have not been accurately forecasted, making the development goals, solutions, and implementation schedules unrealistic.

Details according to the consolidated table of disbursement progress for the Plan 2004-2006:

3. Existence and causes

3.1. Awareness of customs officers

A portion of leadership at all levels of customs have not fully recognized the correct position and role of reform and modernization work linked to customs operations, thus their actions have not achieved the objectives, even eliminating the motivation for modernization; they do not support reform and modernization; conflicts between personal interests and overall interests have hindered the reform and modernization process.

A portion of officials and civil servants have not fully recognized the necessity and requirements for reform, development, and modernization of customs; they are not proactive in implementing or rely on their units; they do not actively study and improve their professional skills; there is a reluctance to implement changes when transitioning from traditional management methods to modern ones; or they work in old ways for personal benefits.

The general level of some officials and civil servants has not met the requirements of integration, reform, and modernization of management and operational tasks.

In summary, regarding the awareness of a portion of customs officials, old habits have not been changed, they have not delved into the essence, and have not been specific and resolute in their work, showing a tendency towards superficial slogans, easy to do but difficult to abandon...

3.2. Regarding plan formulation

- From the implementation of Plan 810, it can be seen that the planning of the General Department of Customs is not good. The overall plan lacks a tight connection and coordination among programs of reform, development, and modernization across various fields of operation. Due to the short implementation period, the proposed goals and solutions are subjective; there was no survey, evaluation, or conclusion on specific topics before formulating the plan, so the forecast was inaccurate and incomplete; many set goals were too large, exceeding the capacity of the customs sector to achieve.

- Many contents related to reform, development, and modernization activities have not been accurately predicted, leading to unfeasible development goals, solutions, and implementation schedules. Contents with the nature of pressure from international commitments were inadequately prepared, passive, and insufficiently researched, resulting in unsatisfactory effectiveness.

- The team of officials and staff responsible for formulating plans still have certain limitations in terms of experience and knowledge, especially modern customs management experience and strategic planning experience. They have not effectively utilized human resources to develop the sector's development strategies and plans. In reality, many delegations and officials were sent abroad to learn about modernization, but did not participate in the task of formulating plans due to the lack of management mechanisms and participation mechanisms.

3.3. Regarding the organization and implementation of the plan

There has been no preparation or formation of a specialized organization with sufficient strength in organizational structure, status, responsibility, and authority... to concretize the plan, organize, supervise, adjust, coordinate, and evaluate the implementation of the targets set out in the plan according to the approved schedule, leading to a lack of clarity in directing and managing the modernization process throughout the sector.

Some units have not closely followed the plan's objectives in building and implementing programs under their jurisdiction. Coordination and cooperation between functional units overseeing modernization implementation and specialized units within the General Department as well as local Customs Bureaus have not been truly integrated.

Some targets set forth in the Plan with relatively appropriate schedules, but during implementation, there were changes at higher levels while lacking preparation for implementation conditions, leading to results not meeting expectations, generating many issues and inconsistencies.

From the General Department to provincial and city Customs Bureaus, specialized forces for modernization have been formed. The establishment of these units in various organizations does not meet the requirements and tasks, in some places, there are too many people assigned despite low demand for modernization work, making the activities of this force ineffective due to confusion in organizing and implementing.

During the implementation of the plan, the coordination between units under the General Department of Customs, between the General Department and local Customs, between the General Department and units under the Ministry of Finance, and between the Customs Authority and relevant Ministries and sectors has not met the requirements for organizing the implementation of reform, development, and modernization goals.

3.4. Participation of related parties

The participation of Ministries and sectors has not truly met the demands of the customs modernization process. For example, when developing a data processing program for electronic customs procedures, significant difficulties arose in the coding of goods subject to policy management by various Ministries and sectors, which had not been standardized. The network connection system between the General Department and Customs units was not guaranteed. Information exchange between the Customs Authority and Tax, Treasury, Bank, and related parties such as shipping companies and port authorities was not regular or sufficient, affecting the information needed for Customs operations.

Enterprises are not truly confident about the benefits brought by customs reform, development, and modernization to import-export activities, investment, and tourism; the thinking and working methods of most enterprises still follow old ways, reluctant to change, even unwilling to change because it affects their business methods, which may involve fraud when done in the old way, thus enterprise support for the reform and modernization process is limited, affecting the achievement of set goals.

4. Lessons learned from implementing the Modernization Reform Plan

First: Reform, development, and modernization of the Customs sector is a continuous process that takes place over a long period with many stages. Therefore, it is necessary to have a Strategic Plan for the Development of the Customs Sector with a long-term guiding nature for reform, development, and modernization efforts. From this Strategy, the Sector will be able to determine specific goals, programs, and contents of the modernization reform work at each stage and annually, serving as a basis for scientific and effective management and guidance.

Second: Cadre work must be considered one of the key tasks of the reform, development, and modernization effort; alongside this, it is necessary to build, train, and develop a cadre of customs officers with modern customs knowledge and skills. This task needs to be carried out concurrently with the work of evaluating, arranging, promoting, and rotating cadres.

Third: Leadership and management must focus and be resolute based on the goals and program of the modernization reform work so that the leadership and management of customs authorities at all levels in the modernization reform work can be practical; during the implementation process, particular attention should be paid to coordination, inspection, supervision, interim review, and final evaluation of the plan's implementation to draw lessons.

Fourth: To implement the reform and modernization work of the Sector, the participation and support of Ministries, sectors, provincial and municipal People's Committees, and the business community are required. The Customs Authority must proactively study and propose many solutions to effectively and creatively coordinate with relevant agencies to fulfill common tasks.

Fifth: It is necessary to strengthen educational and promotional activities about reform and modernization with the aim of:

- Enhancing awareness about customs reform and modernization among the customs cadre and civil servants, thereby determining political resolve in achieving the set goals;

- Promoting the benefits brought by customs reform and modernization to businesses and other partners to gain their support and cooperation;

- Promoting the content, measures, and goals of reform, development, and modernization to related parties to ensure the realization of the customs modernization goal.

II. NECESSITY, GOALS OF REFORM, DEVELOPMENT AND MODERNIZATION OF THE CUSTOMS SECTOR UNTIL 2010

1. The necessity to continue reform, development, and modernization

1.1. Context

Domestic situation: During the period of 2008-2010, the Customs Sector implemented reform, development, and modernization work in the context where Vietnam officially joined the WTO, expanded bilateral and multilateral relations, and deeply integrated into global economic forums. As a result, the volume of import and export goods, transportation vehicles, and passenger entry and exit increased rapidly. Domestic production continued to grow at a high rate, still requiring imports of equipment, machinery, and raw materials. Export turnover continued to increase significantly. Foreign investment in Vietnam also continued to rise at a faster pace, especially when Vietnam became a WTO member and joined free trade areas, specifically:

- Export of goods increased on average by 22.74% per year during the period of 2001-2006; in 2007, export turnover reached 48.56 billion USD, up nearly 22% compared to 2006. Forecasting for 2010, total export turnover will reach 83.76 billion USD with an average annual growth rate of 20%;

- Import of goods increased on average by 21.66% per year during the period of 2001-2006; in 2007, import turnover reached 62.68 billion USD, up nearly 40% compared to 2006. Forecasting for 2010, total import turnover will reach 123.55 billion USD with an average annual growth rate of 25%;

- The Office of Legal Document Supervision (Ministry of Justice);Number of passengers entering and exiting in 2007 was approximately 13.75 million (6.73 million for departure; 7.02 million for arrival). Forecasting for 2010, there will be around 23.7 million passengers entering and exiting annually (11.6 million for departure; 12.1 million for arrival). Forecasting shows that the number of passengers crossing international border gates by road will increase rapidly, large cruise ship tourism and other means of transport will become more frequent and regular at Vietnamese ports;

- Number of transportation vehicles entering and exiting in 2007 was 398 thousand trips, up 26.7% compared to 2006 (195,500 for departure; 202,500 for arrival). Forecasting for 2010, there will be around 688 thousand trips of transportation vehicles (338 thousand for departure; 350 thousand for arrival), in addition to increasing in quantity, diversification in types, there will also be various multi-functional transportation vehicle forms;

- Number of enterprises granted code numbers actually participating in import and export activities in 2007 was 34 thousand; with an average growth rate of 20%. Forecasting for 2010, there will be around 58,500 enterprises participating in import and export activities; in 2007 was 34 thousand; with an average growth rate of 20%. It is forecasted that in 2010, there will be approximately 58,5 thousand enterprises participating in import and export activities;

Total number of customs declarations for import and export goods in 2006 reached 2,319,935 (1,124,614 for exports; 1,195,321 for imports). Total number of customs declarations for import and export in 2007 was 2,871,000 declarations. With an average growth rate in import and export of over 20% during the period of 2008-2010, it is forecasted that there will be approximately 5.1 million declarations by 2010.

International situation: The development of international trade continues to increase both in content and form. Globalization and free trade agreements make the import and export turnover of goods of each country increase rapidly. While tariff barriers are gradually reduced according to specific schedules, new forms of protection such as technical barriers, sanitary and phytosanitary standards, environmental regulations, anti-dumping, monopoly... are increasing and becoming more severe conflicts. Requirements for transportation and exchange of goods in international trade must be fast and diverse in transportation methods. Meanwhile, e-commerce and many new forms of trade such as service provision and outsourcing for foreign countries, online business have developed rapidly and become widespread.

The emergence of international terrorism risks, smuggling, illegal transportation of various types of waste, dangerous toxic substances, narcotics, weapons, money laundering in various forms leads to economic instability risks and insecurity for community interests.

In this context, customs agencies around the world must change to adapt to the new and complex situation with the aim of ensuring maximum facilitation for international trade activities through the application of risk management techniques, investment in modern equipment, and the application of information technology in modern customs management, while also ensuring compliance with customs laws to ensure national security, economic benefits, and safety for international supply chains.

1.2. The necessity to continue reforming, developing, and modernizing the Customs sector

- Fulfilling international commitments requires Vietnam's Customs to undergo reforms and modernization to ensure compatibility and alignment with global development trends and integration into the world and regional customs systems.

- The Customs sector must continue to reform towards achieving management levels comparable to those of advanced countries in the region and worldwide.

- Reform, development, and modernization to enhance management capacity in both quality and efficiency to address the contradictions between the rapid increase in import and export goods volume, means of transport, and travelers, and the requirements for facilitating trade, investment, and tourism under limited resources.

- Reform, development, and modernization to facilitate and streamline import and export activities, investment, and tourism, contributing to enhancing domestic enterprises' competitiveness.

- To implement major policies of the Party and State regarding the prevention of corruption and negative practices, and the promotion of administrative reform in the customs sector.

1.3. Opportunities and challenges in the work of reforming, developing, and modernizing the Customs sector

a. Opportunities

- The correct economic and social development policy of the Party and State has promoted rapid and stable economic and social development, creating many business opportunities for domestic and foreign enterprises in international trade, which provides favorable conditions for the Customs sector to carry out its reform and modernization efforts.

- The Customs sector receives special attention from the Party, State, and Ministry of Finance leadership, which are key factors for the development and modernization of customs.

- The Customs sector has a long tradition and is organized according to centralized principles from central to local levels. It also receives significant technical, expert, and financial support from customs agencies and international organizations, particularly the General Department of Vietnam Customs, which was allowed to accept a World Bank-funded modernization project worth $70 million, a large-scale project that facilitates Vietnam's customs reform and modernization.

b. Challenges

- Current customs management methods still heavily rely on manual processes. The overall capabilities of customs officers are limited in many aspects. Some customs officials exhibit negative behaviors, seek personal gain, and lack strong commitment to reform and modernization, often struggling with complex tasks.

- Some legal regulations in the customs sector are incomplete, lacking synchronization, or overlap with regulations within and outside the sector. Coordination among ministries, functional departments, localities, and customs authorities, as well as between the customs sector and other units within and outside the finance sector, is not yet satisfactory.

- Infrastructure and working tools are not fully equipped and suitable for reform and modernization requirements. The current information system does not meet modern management needs, failing to provide timely, accurate, and comprehensive data.

- The level of legal compliance awareness among partners involved in import and export activities and traveler entry and exit is low: some businesses have not thoroughly studied new customs law regulations; others exploit the openness and facilitation of trade activities for smuggling, commercial fraud, and tax evasion, causing difficulties for customs reform and modernization.

- There is no legal mechanism or coordination mechanism binding the responsibilities of related units in reform and modernization work, especially among units within the finance sector.

- The content of customs reform, development, and modernization is closely linked and dependent on the progress of finance sector reform and modernization, and national administrative reform generally, making it difficult to ensure consistency and synchronization in construction and implementation, requiring joint efforts from all levels of state management agencies.

1.4. Opportunities and challenges facing the Customs sector in reform, development, and modernization

a. Opportunities

- Vietnam belongs to the dynamic Southeast Asian economy, along with globalization and economic integration trends, providing opportunities for Vietnam's development. Under these conditions, Vietnam's Customs receives support from countries and international organizations such as the World Bank (WB), MDTF Fund, JICA, etc., to reform and modernize customs towards building a modern Vietnam Customs and quickly meeting international and regional advanced standards.

- Vietnam is recognized for having a stable political and security environment conducive to attracting foreign investment; the results of economic development and increased foreign investment create momentum for Vietnam Customs' reform and modernization program aimed at simplifying, streamlining, and unifying customs procedures in line with World Customs Organization (WCO) standards, aligning with international practices and customs to facilitate business operations.

- Advances in science and technology worldwide, along with many lessons learned from modern customs management practices in developed countries such as the United States, Japan, South Korea, and the European Union; from the World Customs Organization and customs agencies of ASEAN countries provide impetus for the development of Vietnam's Customs.

b. Challenges

- As a member of the WTO and participating in regional and global integration, Vietnam not only benefits from many preferential treatments but also must implement the results of bilateral and multilateral negotiations on trade policies, intellectual property protection, etc. High demands from the business community and society require both facilitation of trade and improvement in service quality while ensuring effective law enforcement in customs matters.

- Vietnam's Customs aims to improve and innovate its relationship with the business community, recognizing businesses as cooperative partners in jointly enforcing and complying with laws rather than mere objects of customs inspection and supervision. In conditions where the area of operation includes a long coastline and borders adjacent to multiple countries, smuggling and commercial fraud continue to occur in a highly complex manner.

- The reform and modernization program sets increasingly high requirements for managers, particularly concerning introducing new concepts in areas covered by the Plan, including: procedural and legal framework reforms according to international standards; centralized data processing; risk management; compliance and trade facilitation...

- The world situation still harbors many risks causing instability such as terrorism, civil war, epidemics... leading to unpredictable developments that affect the implementation of reform and modernization goals for customs.

2. Views, models, and targets for reform, development, and modernization

2.1. Views on reform, development, and modernization of customs

First - Reform, development, and modernization of customs must be in line with general trends, with the standards of the World Customs Organization and the region, while also being consistent with national administrative reform and the overall development direction of the country.

Second - Customs reform, development, and modernization must ensure a balance between facilitating export, import, exit, entry, and investment activities, while also ensuring strict state management of customs in accordance with the law, enhancing enterprises' awareness of compliance and adherence to the law.

Third - Customs reform, development, and modernization should focus on key regions and areas to concentrate investment resources for modernization to achieve high efficiency; at the same time, consider balanced, harmonious, and uniform development among other regions and areas, ensuring comprehensive modernization across the entire sector.

Fourth - Customs reform, development, and modernization should be based on mobilizing maximum resources both domestically and internationally, within and outside the Finance Ministry, with a focus on leveraging domestic strength and that of the Customs sector.

2.2. Direction and principles of action of Vietnam Customs until 2020

2.2.1. Development orientation

- Target orientation

+ Strictly implementing Vietnamese laws, international commitments, and practices to facilitate trade, investment, tourism; strengthen national security, safety for the community, and ensure revenue from import-export activities for the State budget.

+ Vietnam Customs will become one of the leading administrative agencies in administrative reform and modernization in Vietnam and one of the leading customs agencies in ASEAN and globally.

+ Vietnam Customs will be a modern customs agency with a complete, transparent customs legal system meeting international standards; customs officers will have professional and specialized qualifications; customs procedures will be simple, harmonized, unified, and meet international standards based on information technology applications, risk management techniques; modern technical equipment and high technology usage.

- Model orientation:

Modern customs management based on centralized and unified principles using information technology platforms and applying risk management techniques, including:

+ Business processes implemented on centralized data processing systems at the General Department and Provincial Customs Bureaus (operating under the Regional Customs Bureau model) include: Fully automating the management of goods information through the completion of electronic data exchange systems with key agencies related to goods management; processing information, deciding inspection methods based on risk management techniques... Applying information technology advancements to customs management through synchronized informatization and automation via unified and complete management systems.

+ The clearance model forms three blocks: Block for receiving, processing centralized data, and providing feedback on customs declarations (data processing center); block for centralized file inspection (Regional Customs Bureau or Border Customs); goods inspection (centralized inspection location, clearance point).

+ Modern management method based on risk management techniques combined with enhancing legal compliance awareness, strengthening voluntary compliance, applying mandatory compliance sanctions, and intensifying post-clearance inspections.

+ Efficiently utilizing modern technical equipment, including: Centralized commodity classification analysis centers at the central level and Regional Customs; container scanning systems; equipment and means serving customs inspection, supervision, and control activities.

2.2.2. Principles of action of Vietnam Customs are:

Convenience - Diligence - Accuracy

2.3. Targets of Vietnam Customs until 2010

2.3.1. Overall target: The customs business model up to 2010 was based on the platform of partial automation and centralized data processing at the General Department level, gradually applying risk management techniques, information technology applications, and modern equipment investment at selected key areas. Determining the general goal up to 2010, Vietnam Customs developed towards modernization including four main contents as follows:

a. A complete, transparent, simple, harmonious, and unified customs procedure system and basic customs management regulations, gradually applying information technology and risk management techniques to meet integration and modernization requirements;

b. Modern technical equipment at some key areas with large volumes of import and export goods, transportation means, and inbound and outbound passengers;

c. Reorganizing the customs organizational structure to eliminate overlapping functions and tasks, promptly meeting the requirements for customs procedural reform, aiming to meet modern customs management needs;

d. Preparing all aspects for changes in personnel management methods according to modern requirements; implementing a focused training strategy for important business areas (classification of goods, determination of customs value, origin of goods, post-clearance audit, intelligence information, risk management, anti-smuggling control) and honest customs practices.

2.3.2. Identifying some key areas

Investing in headquarters, modern technical equipment to serve the management work of Customs at international seaports, international airports, railway border gates, road border gates, and key industrial zones and export processing zones with large volumes of import and export goods and inbound and outbound passengers, specifically:

a- International seaports:

+ Centralized inspection area, Lach Huyen (Haiphong);

+ Thien Sa Port (Da Nang City);

+ Cat Lai Port, Hiep Phuoc Port (Ho Chi Minh City);

+ Cai Me - Thi Vai Port Cluster, Phu My Port (Ba Ria - Vung Tau Province).

b- International airports:

+ Noi Bai International Airport (Hanoi City);

+ Tan Son Nhat International Airport (Ho Chi Minh City);

+ Da Nang International Airport (Da Nang City).

c- Railway border gates:

+ Dong Dang Station (Lang Son Province);

+ Lao Cai Station (Lao Cai Province);

+ Yen Vien International Railway Station (Hanoi City).

d- Road border gates:

+ Hoa Lien Gate (Lang Son Province);

+ Lao Cai Gate (Lao Cai Province);

+ Mong Cai Gate (Quang Ninh Province);

+ Lao Bao Gate (Quang Tri Province);

+ Mo Cay Gate (Tay Ninh Province).

e- Some industrial zones and export processing zones in key economic regions identified by the Government.

III. SOLUTIONS AND ACTIVITIES TO IMPLEMENT THE OBJECTIVES

1. Customs Procedure Reform Program

1.1. Customs Procedure Reform

1.1.1. Clearance Procedures

a. Objectives

Customs procedures (including both manual and electronic) for goods, passengers, and transport vehicles are basically improved to be simpler, harmonious, and unified; continuing to expand pilot electronic customs procedures to meet the requirements of facilitating trade, investment, tourism, and ensuring security.

b. Indicators

- Standardizing current manual declaration forms to unify their application for both electronic and manual declarations according to WCO standards and regional ASEAN standards;

- Striving to achieve 80% of import and export turnover declared through computer networks;

- Applying risk management at key stages of customs procedures (both manual and electronic) and for various types of commercial imports and exports, implementing automatic channeling based on risk assessment for both electronic and manual customs procedures;

- At major international seaports and airports, electronically receiving cargo declarations and passenger information from port authorities exceeding 90%;

- Inspecting goods using container scanning machines at: Centralized Inspection Area (Haiphong); Thien Sa Port (Da Nang); Cat Lai Port, Hiep Phuoc Port (Ho Chi Minh City); Cai Me-Thi Vai Port Cluster (Vung Tau); Lao Bao Border Gate (Quang Tri); Hoa Lien Border Gate (Lang Son); Mong Cai Border Gate (Quang Ninh);

- Declaring customs through customs agents at key Customs Departments exceeding 30% of total goods declaration at these units.

c. Solutions and activities to implement objectives

- Applying the standards and recommendations of the amended Kyoto Convention, relevant international agreements and conventions: Continuing to review international commitments to improve customs procedures (including tax management procedures) towards simplicity, harmony, and conformity with international standards.

- Implementing phase 2 of electronic customs procedures, expanding the scope, drafting a Decree on electronic customs procedures to apply to key areas, specifically:

+ Expanding nationwide remote declaration through the network, creating conditions for quick clearance and laying the groundwork for electronic customs procedures; encouraging the development of customs agents;

+ Exchanging electronic data with carriers, port authorities, agents, and licensing agencies to receive information about goods and passengers before transport enters the country; exchanging electronic data with banking and treasury systems to ensure timely information for business operations and goods clearance;

+ Pre-clearance for enterprises with high compliance, granted priority electronic customs clearance cards;

+ Self-declaration and self-payment of taxes according to the Law on Tax Administration; tax payment and debt tracking basically carried out electronically;

+ Pilot application of priority enterprises under the SAFE framework;

+ Preparing conditions to implement the national single window mechanism and ASEAN single window mechanism according to international commitments.

- Redesigning customs procedures based on information technology applications (coordinating with the results of the "Customs Procedure Redesign" tender package of the World Bank project).

1.1.2. Customs Management System

a. Customs management system for transit goods

Objective

Facilitate the transit of goods through the territory of Vietnam to the greatest extent possible; review and improve current national procedures and regulations on transit towards harmonizing procedures with countries participating in transit; establish a system of national regulatory documents for transiting goods; organize customs forces with sufficient capacity to implement transit procedures.

Solutions and activities to achieve the objectives

- Study and apply the most common international practices and provisions of relevant international agreements to amend and supplement the management mechanisms and procedural processes for goods and means of transport in transit according to the World Trade Organization (WTO) and Greater Mekong Subregion (GMS) regulations on customs procedures for goods and means of transport in transit.

- Develop procedures, regulations, and organize the implementation of two related ASEAN transit protocols under the Framework Agreement on Facilitation of Cross-Border Paperless Trade in Asia and the Pacific (FAFP).

- Develop, promote, and maintain national guidance documents on customs transit regimes as reference materials for customs officers.

b. Temporary Admission Regime

Objective

Provide the highest level of facilitation in customs procedures for a specific commodity entering the customs territory of Vietnam that is exempted from part or all import duties and other taxes.

Solutions and activities to achieve the objectives

- Develop procedures, regulations, and organize the implementation of bilateral temporary admission agreements with some countries for pilot projects.

- Promote and train on temporary admission and the ATA Convention.

- Conduct surveys on the implementation of temporary admission in some countries to roll out temporary admission procedures in Vietnam.

Sign and implement the ATA Convention in Vietnam; organize seminars for relevant parties.

c. Express Delivery

Objective

Improve express delivery services of goods and commercial documents into and out of the territory of Vietnam to enhance the international competitiveness of domestic producers and attract foreign investors based on reviewing current customs regulations and procedures to develop customs management systems and fast clearance procedures in accordance with international practices.

Solutions and activities to achieve the objectives:

- Fully survey and evaluate information related to express delivery in Vietnam as a basis for developing proposals to accelerate programs to improve express delivery management systems.

- Comprehensively study the World Customs Organization (WCO) guidelines on expediting the release of goods (Immediate Release Guidelines) and related provisions of the Kyoto Convention.

- Establish a system of guidance documents for express delivery through various types of international transportation in line with global standards and practices.

d. Other Customs Management Regimes

In addition to the aforementioned customs regimes, continue to implement activities to amend and supplement existing management regimes such as processing trade, investment management, customs management in export processing zones, bonded warehouses, preferential tariff areas, guarantee regimes, etc., based on applying information technology to unify procedures, content, and methods of management.

1.1.3. Tax Administration

a. Objectives

Modernize the operational aspects of tax administration and budget revenue collection including analysis, evaluation, and forecasting of budget revenues; organizing tax collection; managing tax arrears and tax exemptions based on the application of information technology to ensure the achievement of budget revenue targets assigned.

- Projected state budget revenue from 2008 to 2010:

Unit of measurement: billion VND

- Arrears recovery target:

b. Solutions and activities to achieve the objectives

- Establish and improve management procedures for tax arrears tracking; tax exemptions, reductions, refunds; investment incentives; tax assessments, tax recoveries; tax enforcement...;

- Modernize statistical analysis of trade volumes and tax revenues to build budget forecasts for each tax type annually while implementing the budget forecast across the entire sector based on IT application;

- Modernize management practices for tax exemption, reduction, refund, investment incentives, tax assessment, tax recovery, and enforcement measures based on IT application;

- Modernize tax arrears management according to the Tax Administration Law requirements, tracking each tax type in detail for each declaration to ensure collection in accordance with the prescribed procedures based on IT application;

- Improve mechanisms to synchronously apply customs measures and coordinate with relevant agencies within the Finance Ministry and other related agencies to ensure tax revenue protection;

1.1.4. Partnership between Customs and Enterprises

a. Objectives

- Become a partner with the business community and related parties to achieve simple, convenient, and lawful clearance processes;

- Strengthen cooperation and information exchange between Customs and Enterprises to enhance mutual understanding for facilitating trade and ensuring compliance;

- Enhance coordination between Customs and relevant state management agencies;

b. Solutions and activities to achieve the objectives

- Develop and improve the system of customs brokers to facilitate the implementation of electronic clearance according to the roadmap; Specifically: Summarize and evaluate the operations of model customs brokers at the Haiphong, Ho Chi Minh City, and Hanoi Customs Departments, while developing a proposal to enhance the capacity of customs brokers according to the roadmap;

- Establish a coordination mechanism among relevant ministries and sectors in national inter-sectoral programs and activities;

- Develop a mechanism to resolve issues among ministries and sectors during the implementation of customs matters related to international integration;

- Rebuild the content and form of high-level consultations between the Customs agency and the business community to ensure practical and specific results. Specific activities include improving the consultation and support mechanism under the Customs Law and Tax Administration Law between the Customs agency and the business community; organizing consultations to collect opinions for policy planning by the Customs agency;

- Apply joint cooperation programs to strengthen customs control through effective information exchange and provision. Specific activities include establishing joint cooperation programs and capacity-building programs; building capacity-enhancing programs for customs officers and related entities;

- Gradually implement the core standards of the World Customs Organization (WCO) in the Customs-Business framework: including partnership standards, priority businesses, security, licensing, technology, information exchange, and cooperation;

(Details of each activity in customs procedure reform; implementation timeline; lead unit; estimated budget and cooperating units are specified in Appendix 1A)

1.2. Customs Technical Operations

1.2.1. Goods Classification

a. Objectives

Enhance skills in classifying imported and exported goods to ensure standardized classification and resolution of disputes over classification by customs officials. Address inconsistencies in coding within a Customs Branch, Department, and throughout the sector.

b. Solutions and activities to achieve the objectives

- Build a database of commodity codes for import-export declarations to support code verification and inspection. This is a crucial prerequisite for standardizing coding throughout the sector;

- Organize training programs for customs officials and enterprises on the classification of import-export goods and staff them professionally and deeply;

- Effectively implement pre-import classification work, proactively determine codes for new, complex, and sensitive goods regarding taxes and import-export policies to assist declarants and customs officials;

- Complete a unified, transparent, stable, and convenient regulatory system for goods classification (including dispute resolution and complaints about classification);

- Invest in enhancing analytical capabilities at the three existing centers, aiming to establish a central analysis and classification center at the General Department and branch centers in customs regions;

- Vigorously develop the customs broker system to improve professionalism and accuracy in classifying and applying codes for import-export goods.

1.2.2. Customs Value

a. Objectives

- Gradually effectively implement the WTO Customs Valuation Agreement: control declared values, limit commercial fraud through prices; standardize valuation inspection procedures, consultation procedures, and value determination consistent with the Agreement and the sector's modernization process; complete dispute resolution mechanisms on pricing; develop price databases and other supporting tools to control declared values; establish a mechanism to support businesses in determining customs values.

- Specific targets:

+ Control declared values for 100% of import-export consignments based on risk management and compliance management;

+ Conduct price consultations for certain sensitive product groups with high tariff rates where the Customs agency has sufficient data and management conditions.

b. Solutions and activities to achieve the objectives

- Establish a complete legal foundation to fully implement the WTO Customs Valuation Agreement:

+ Continue to adjust the national legal framework by incorporating the provisions of the WTO Customs Valuation Agreement and its Notes into the national legal framework;

+ Organize the effective implementation of the dispute resolution and complaint system for issues related to customs;

+ Submit to the competent authority for issuance of the Regulation on the collection, management, and use of valuation data and declarations;

- Harmonize the application of valuation:

+ Implement the four-step valuation inspection process; improve the price consultation work to make it substantive and effective;

+ Apply risk management techniques in the implementation of valuation inspections;

+ Develop and enhance reference price databases; update and disseminate information on determining customs value and support relevant parties involved in customs on a regular basis;

+ Establish a mechanism for exchanging valuation information with customs authorities of other countries;

- Strengthen and enhance organizational management for the implementation of customs valuation:

+ Review and perfect the current organizational structure to implement and manage customs valuation;

+ Develop and enhance the functions and responsibilities of the valuation department;

1.2.3. Origin of Goods

a. Objectives

Enhance the skills of customs officials and business communities in verifying the origin of goods to ensure that goods enjoy the correct tariff and trade preferences as stipulated by law and consistent with the criteria for the origin of such goods;

b. Solutions and activities to achieve the objectives

- Build a database on the origin of goods to serve customs declaration and verification of origin;

- Improve the professional expertise of customs officials in verifying the origin of goods in a professional and specialized manner, particularly knowledge related to rules of origin, methods for determining the origin of goods, and investigation and verification skills at the exporting country according to agreements and regulations on origin;

- Develop guidance materials, inspection procedures for verifying the origin of goods, and a pre-determination mechanism for the origin of imported goods;

- Study and implement a system for connecting and exchanging information with organizations issuing certificates of origin from other countries to verify the validity of certificates of origin;

1.2.4. Intellectual Property

a. Objectives

Perfect the legal framework, mechanisms, and organization for implementing intellectual property control;

b. Solutions and activities to achieve the objectives

- Perfect the legal framework regarding intellectual property for exported and imported goods, including:

+ Review, amend, and supplement relevant legal provisions concerning the enforcement of intellectual property rights at borders by customs authorities clearly and consistently;

+ Propose additional powers for customs authorities to proactively apply measures to enforce intellectual property rights;

+ Research and implement WCO standards for combating intellectual property rights violations (SECURE);

+ Develop a strategy for protecting intellectual property rights at borders;

- Establish mechanisms and organizations for customs authorities to protect intellectual property rights at borders, including:

+ Develop procedures and regulations for the operation of forces tasked with enforcing intellectual property rights protection for imported and exported goods;

+ Develop a complaint resolution mechanism and organize the implementation of activities for enforcing intellectual property rights protection for imported and exported goods; enhance professional capacity and technological infrastructure to effectively implement intellectual property rights enforcement;

+ Strengthen organizational structures to ensure the enforcement of intellectual property rights at borders, establish a specialized unit against counterfeit and infringing goods at the General Department of Customs; develop a coordination mechanism with customs authorities of other countries, industry associations, and intellectual property protection organizations;

(The details of each reform activity regarding technical and professional customs operations; implementation timelines; lead units; estimated budget; and coordinating units are specified in Appendix 1B and the Management Plan for Taxable Value Calculation Phase 2008-2010;

1.3. Perfect the legal framework for customs activities

1.3.1. Objectives

Customs laws are generally comprehensive, transparent, and meet the requirements for regulating issues arising during the modernization reform period from 2008 to 2010;

1.3.2. Solutions and Implementation Activities

- Review and systematize most international commitments related to customs law

+ Review and systematize the entire list of international treaties in the customs field, related to the customs sector;

+ Organize training and upgrading of knowledge about customs-related commitments in international treaties for customs officials and civil servants;

+ Closely monitor and evaluate the domestication of international treaties related to the customs sector;

- Develop, amend, and supplement the customs legal system

+ Based on reviewing international commitments, amend and supplement regulatory legal documents guiding customs operations and procedures to be consistent with practice and international commitments Vietnam has signed or joined;

+ Develop and submit to competent authorities for issuance of regulatory legal documents on electronic customs procedures (including Government Decrees on electronic customs procedures and accompanying implementation guidelines);

- Promote transparency in customs legal regulations

+ Review and systematize legal regulatory documents on promoting trade policy transparency; review the regulatory content within customs operational procedures, circulars, and incorporate these contents into legal regulatory documents;

+ Summarize the implementation of transparency by the General Department of Customs, highlighting successes, limitations; causes, and solutions;

+ Develop regulations and procedures for soliciting opinions from the business community on draft regulatory legal documents as well as information provision processes.

+ Coordinate with the Vietnam Chamber of Commerce and Industry and industry associations, business communities to exchange and resolve issues arising from difficulties related to mechanisms, policies, customs procedures;

+ Continue to maintain the advisory form "Problem-solving Team" at customs procedure locations to guide and answer businesses' inquiries;

+ Publicize on the Vietnam Customs Web site legal regulatory documents on customs and other related guidance documents, including translations of these documents into foreign languages. Post other information that businesses need to know on the Customs Website.

(Details of each activity regarding the completion of the legal framework; implementation timeline; leading unit; estimated budget and cooperating units are specified in Appendix 1C)

2. Program to Reform and Enhance the Effectiveness of Customs Management Work

2.1. Reform of Business Management Work

2.1.1. Objectives

Establish a mechanism for compliance control to serve modernization of customs, strengthen information collection and risk management work, combined with anti-smuggling efforts and enhanced post-clearance inspection and tax audit work.

2.1.2. Solutions and Activities to Achieve Objectives

a. Compliance Management

- Objective

Internalize certain compliance management contents; implement activities related to compliance management such as (measurement, assessment, and improvement of compliance levels of enterprises); prepare necessary conditions to ensure compliance management implementation; and enhance voluntary compliance levels of the business community and relevant parties.

- Indicators

+ Assess the level of compliance with laws of about 8% of enterprises engaged in import and export activities;

+ Complete files of enterprises complying with customs laws at 80%.

- Main Activities

+ Develop a Compliance Management Strategy and Implementation Plan until 2010 and Vision 2020;

+ Continue to internalize compliance concepts into customs regulatory documents and implement comprehensive compliance management linked to risk management methods and effectively apply post-clearance inspection and tax audit measures;

+ List and classify enterprises implementing compliance;

+ Guide and inspect enterprises self-assessing and implementing compliance;

+ Develop training and capacity-building projects on compliance management for customs officers and promote awareness among businesses.

b. Information Collection, Processing and Risk Management

Principles guiding the development of the Customs risk management program in the coming years include: ensuring compliance with customs laws and related laws to meet reform and modernization requirements; meeting World Customs Organization standards on unified risk management models, risk assessment techniques, risk management policies, information technology, electronic data...

- Objective

Improve the effectiveness of risk management application in the clearance process of exported and imported goods; expand the scope of risk management application in post-clearance inspections and for transportation vehicles and passengers entering and exiting; enhance the quality of information collection and processing in customs operations.

- Main Activities

+ Issue and implement regulations at the Ministry level on applying risk management in customs operations; collect and process customs operational information: Issue joint circulars with relevant ministries and sectors on providing and exchanging customs operational information;

+ Upgrade and improve the risk management system for commercial exports and imports (including various forms of trade contracts, temporary imports for re-export, transshipment, raw materials for export production, overseas processing contracts,...): Gradually apply risk management to passenger luggage and transportation vehicles on air routes. Develop, manage, and apply risk files; enterprise files;

+ Upgrade the information system supporting risk management to meet requirements for the following areas: risk assessment and classification during the clearance of exported and imported goods; transportation vehicles and passengers entering and exiting; electronic data summary declarations; serving post-clearance inspections. Provide risk analysis results to support customs control activities. Databases and tools to meet the analytical requirements of all levels and units within the customs sector;

+ Organize nationwide information collection on enterprises to achieve 70% of assigned targets and 70% of criteria as stipulated. Expand cooperation and information exchange mechanisms with ministries, sectors, and industry associations;

+ Strengthen organizational structure, personnel, and equipment of customs levels and units responsible for collecting and processing customs operational information and managing risks;

+ Further develop basic theoretical foundations and textbooks on risk management; coordinate training in risk management to achieve the goal: All officers and staff in the customs sector have a basic understanding of risk management. Meet the understanding and capability requirements for risk management of the team of officers and staff specializing in risk management at provincial and city-level customs bureaus;

+ Coordinate with the World Bank Project Management Board to implement tender results; Exceptional intervention.

c. Anti-Smuggling and Illicit Goods Transportation Work

Apply customs control measures, collect and process operational information, and risk management techniques to proactively prevent, detect, and effectively stop smuggling and illicit goods transportation across borders, especially drugs, weapons, explosives, and prohibited items, to ensure effective tax collection, enforcement of trade policies, and national security. This component is also closely linked to the implementation of World Customs Organization standards on security and facilitation of trade.

- Objective

Implement in depth the basic operational tasks according to Decision 65/2004/QĐ-TTg dated April 19, 2004 of the Prime Minister on the operation regulations of the specialized customs force for combating smuggling and illegal goods transportation across borders, and focusing on fighting serious cases of exploiting loopholes in customs procedures, mechanisms, and policies; drug cases; prohibited goods; and conditional imported goods.

- Main Activities

+ Continue to guide, specify, and implement Decision No. 65/2004/QĐ-TTg mentioned above;

+ Develop and apply record systems for various customs control measures. Deploy research activities to understand the situation, investigate, and establish secret bases at all locations. Establish special cases to combat large, complex, drug, weapon, and prohibited goods cases that affect national security and intellectual property rights violations;

+ Summarize and evaluate the cooperation work with functional forces according to signed cooperation regulations; amend, supplement, adjust these regulations, and implement new areas of cooperation; issue regulations of the sector on cooperation in performing customs control tasks;

+ Maintain regular international cooperation in customs control fields; actively participate in ASEAN Customs control programs;

+ Complete the establishment and improve specialized customs control units. Organize training courses to enhance customs control skills and propose issuing specific systems for special operations and implement investment projects for equipment;

+ Implement Decisions 187/2005/QĐ-TTg and 330/2006/QĐ-TTg of the Prime Minister on strengthening drug prevention capabilities in the Customs sector. Build a specialized dog training center for the Customs sector;

+ Organize and implement administrative enforcement decisions;

d. Post-clearance inspection and tax audit

- Objective

Significantly change the position, capacity, and effectiveness of post-clearance inspections in line with risk management plans, facilitating trade, and ensuring customs inspection and control work;

- Indicators

+ The rate of file reviews at customs offices reaches 100%;

+ The rate of post-clearance inspections at business premises reaches 3%-4% of the total number of businesses involved in import and export activities;

- Solutions and implementation activities

+ Identify post-clearance inspection targets based on analyzing and processing information from relatively complete, ready, and updated databases;

+ Focus on planned post-clearance inspections to assess compliance levels of businesses and particularly prioritized businesses;

+ Classify and control the majority of key enterprises, types, and important import and export goods;

+ Effectively implement the contents of the Tax Management Law; Complete tax auditor standards and select qualified staff to perform tax audits;

+ Continue to study and perfect the system of documents related to post-clearance inspections and tax audits;

+ Continue to improve the post-clearance inspection system;

+ Strengthen training for post-clearance inspection forces to gradually professionalize and deepen their expertise;

+ Enhance the ability to classify targets and build plans to select businesses for inspection and compliance assessment;

+ Enhance the ability to collect, synthesize, analyze, process information, and equip modern machinery and equipment for operational purposes;

+ Develop standard procedures and manuals for post-clearance inspections;

+ Strengthen post-clearance inspections and tax audits at business premises;

+ Collaborate with the Modernization Customs Project Management Board (referred to as the WB Project) to implement tender results;"Exceptional Intervention";

(Details of the Program to improve the efficiency of customs management work; implementation timeline; main responsible units; estimated budget; and cooperating units are specified in Appendix 2A and the Projects to Strengthen Post-Clearance Inspections and Enhance Customs Control Capacity for the period 2008-2010);

2.2. Administrative Management Reform

2.2.1. Objectives

Ensure Customs activities comply with administrative reform spirit, reduce administrative procedures, and move towards a single window at the General Department and its affiliated units;

2.2.2. Solutions and Implementation Activities

- Develop and implement short-term, medium-term, and long-term plans of the Customs sector related to administrative reform and modernization;

- Apply ISO 9001:2000 standards throughout the sector including management and operation standards (information systems, reporting, working regulations) and direct service standards related to citizens and businesses:

+ For the General Department: continue expanding to remaining units of the General Department;

+ For local Customs: prioritize implementation at border Customs branches first, followed by provincial and city Customs departments. Among border Customs branches, prioritize sea, air, and international land border crossings with high import and export volumes, industrial zones, export processing zones, especially the two electronic Customs branches in Hai Phong and Ho Chi Minh City Customs Departments;

- Enhance the capacity of management and leadership staff at all levels in the Customs sector;

- Organize research, surveys, and learning experiences on short-term, medium-term, and long-term planning, and development strategies of foreign Customs;

- Modernize financial management, strengthen financial and state asset management. Use state budget funds effectively, practice thrift, and prevent waste;

- Strive for the majority of officials and civil servants in the Sector to proficiently use application programs of information technology to serve their assigned tasks; the exchange of documents of the Sector, email exchanges, and processing of tasks are mainly carried out on the office information network of the Customs Department;

- Establish and implement customer service standards in various customs procedures (World Bank Project);

- Establish and implement a system of performance indicators for the effectiveness of operations of the Customs Department (World Bank Project).

- Establish and implement the Strategy for the Development and Modernization of Vietnam Customs until 2020 (World Bank Project).

(The details of each activity within the administrative management reform content; implementation timeline; lead units; estimated budget and coordinating units are specified in Appendix 2B)

3. Program for modernizing material infrastructure and applying information technology - customs statistics

3.1. Modernizing material infrastructure

a. Objectives

Invest in modern technical equipment at international seaports, international airport ports, international railway and road border gates, and key industrial zones with high volumes of import-export goods and passenger traffic.

b. Solutions and activities to achieve the objectives

The working premises system meets standard requirements, reasonably planned, equipped with modern and synchronized technical facilities consistent with the information technology system within a unified customs procedure process at international seaports, airports, and major international land border gates, prioritizing the investment in high-tech equipment (high-speed boats, X-ray machines, surveillance cameras, truck scales...), to enhance the inspection and supervision capabilities of the Customs Department, specifically:

- Determine investment locations: prioritize key areas such as seaports, airports, roads, industrial zones, export processing zones with large volumes of import-export goods and passenger traffic;

- Equip modern technical devices and means synchronized with procedural processes, information technology applications, and personnel capable of using these devices. Implement the project to equip container X-ray machines funded by the JICA Project;

- Main equipment: container X-ray machines, surveillance cameras, electronic scales, and other inspection devices, high-speed boats, global positioning systems (GPS), personal information assistance systems... Specifically, container X-ray machines are expected to be equipped as follows:

+ In 2008: equip two mobile container X-ray machines at the Hai Phong Customs Office (concentrated inspection location) and the Ho Chi Minh City Customs Office (Cat Lai Port).

+ In 2009: equip two fixed container X-ray machines donated by Japan for the Hai Phong Customs Office (concentrated inspection location) and the Ho Chi Minh City Customs Office (Cat Lai Port); two mobile container X-ray machines for the Quang Tri Customs Office (Lao Bao Border Gate) and the Lang Son Customs Office (Huu Nghi Border Gate); simultaneously transfer two mobile container X-ray machines from the Hai Phong Customs Office and the Ho Chi Minh City Customs Office in 2008 to the Quang Ninh Customs Office and the Hiep Phuoc Port (Ho Chi Minh City Customs Office).

+ In 2010: equip two mobile container X-ray machines for the Da Nang Customs Office (Tien Sa Port) and the Ba Ria-Vung Tau Customs Office (Cai Me - Thi Vai Port Complex).

- Working premises: Construct new headquarters for the General Customs Department; some provincial and district customs offices in key areas; the Central Analysis and Classification Center for Import-Export Goods in the Central Region; the Customs Service Dog Training Center; the Hai Phong Customs Office and the Ho Chi Minh City Customs Office. Develop and implement the proposal for building training facilities (Customs Vocational School) for officials and civil servants meeting national and international standards;

- Gradually invest in material infrastructure and equip modern machinery and equipment for the Analysis and Classification Centers for Import-Export Goods.

(Details of each activity in modernizing material infrastructure; implementation timeline; lead units; estimated budget and coordinating units are specified in Appendix 3A)

3.2. Applying information technology and customs statistics

3.2.1. Information Technology

a. Objectives

Vigorously apply information technology is a critical task in the plan to implement customs modernization, prioritized towards electronic customs procedures. By 2010, the information system will reach the level of moderately developed countries in ASEAN.

The application of information technology in customs activities must be conducted in a coordinated manner, compatible with customs procedural processes, especially electronic customs procedures, directly serving the implementation of phase 2 of electronic customs procedures, closely tied to the process of reform and modernization of the Sector. Focus primarily on the informatization of customs procedural processes.

Ensure that the information management system serves effective command and control, smooth and timely information exchange from the General Department to provincial and city customs offices and district customs offices nationwide.

b. Indicators

- Prioritize connecting information and electronic data with relevant ministries, sectors, and parties: State Bank, Ministry of Agriculture and Rural Development, Ministry of Health, Ministry of Industry and Trade; freight forwarders, shipping companies...at 50% - 60%;

- Connect the network with functional centers within the Ministry of Finance at 80% - 90% (State Treasury, General Taxation Department);

- 90% of customs officers exchange and skillfully use the application program for managing office work in the Sector, proficiently using information technology application programs to serve their tasks;

- 90% of Sector documents are exchanged over the internal network of the Sector;

- 70% of tasks are processed on the internal network of the Sector.

c. Solutions and activities to implement objectives

- Establish centralized data processing systems at provincial and city customs offices and towards the General Department level; establish two data processing centers in Hanoi and Ho Chi Minh City, maintaining continuous operation 24 hours/day;

- Establish an electronic data portal connected to agencies under the Ministry of Finance, other ministries and sectors, and relevant partners. Transform the Customs website into an electronic information portal providing administrative public services to citizens and businesses, specifically: having 100% information on procedures (guidelines, steps, timeframes...); allowing downloading of forms, applications, customs declarations; enabling declarants to print out or fill in declaration forms to submit information to customs authorities before submitting remote declarations through the network and electronic clearance.

- Integrate basic functions, standardize, and centralize databases for customs management work.

- Ensure the infrastructure for information technology networks, security, and safety.

- Complete operational mechanisms, maintenance, and upkeep for the entire system.

- Centralize databases at the General Department of Customs and key Customs Departments to ensure connectivity with the modernization project funded by the World Bank.

- Build and complete electronic databases for national goods import-export, business, and risk management databases to serve management operations, statistics, and risk management.

- Integrate basic applications serving procedures at Customs Branches such as information systems for declaration management, tax management, cargo flow management...

- Form a comprehensive risk management information system throughout the procedure stages according to international standards.

- Achieve 90% electronic data exchange with units under the Ministry of Finance: Customs, Tax, Treasury.

- Ensure smooth operation of data centers within the industry to all levels of Customs with high security and safety.

- Form a value-added network (VAN) capable of ensuring intermediary connections for electronic data exchange between Customs and external parties.

3.2.2. Customs Statistics Work

a. Objectives

Reach the level of ASEAN region's goods import-export statistics and electronic database that can electronically exchange data at the 6-8 digit HS code level.

b. Solutions and activities to achieve the objectives

- Support strategic objectives of the Customs sector.

- Adhere to international statistical standards:

+ Improve statistical methodology, using standardized concepts and definitions recommended by the United Nations Statistical Commission (UNSD).

+ Utilize standardized classification categories in statistics (HS System, SITC Catalogue, etc.).

+ Study and build a customs statistical system under the conditions of the ASEAN Economic Community (AEC).

- Support and enhance domestic statistical cooperation, bilateral and multilateral cooperation with countries and international organizations:

+ Cooperate with domestic statistical agencies.

+ Cooperate with countries with advanced customs statistics and regional and international organizations.

- Provide the highest quality statistical data and information to users:

+ Provide generated data that users need, especially information for economic management after Vietnam's accession to the World Trade Organization (WTO).

+ Enhance awareness of customs statistics work.

+ Increase accessibility to data for users.

+ Develop a schedule for releasing customs statistical data.

- Organize modern, transparent, and effective statistical activities:

+ Develop regulations detailing data sources and methods.

+ Ensure the confidentiality of personal data.

+ Ensure integrity and objectivity in data processing.

+ Automate and integrate procedures related to the statistical process.

+ Develop data adjustment policies.

+ Certify ISO 9001 for customs statistical activities.

- Produce reliable statistical data and information:

+ Develop a quality control and evaluation process for statistical data.

+ Compare statistical data with partner countries.

Build a team of specialized statisticians through developing the following skills:

+ Basic statistical theory and concepts.

+ Techniques related to data assessment and adjustment.

+ Statistical analysis techniques.

+ Appropriate statistical techniques for customs statistics.

(Details of each application of information technology and customs statistics, implementation timeline, lead agency, estimated budget, and cooperating agencies are specified in Appendix 3B and the Information Technology Development Project for the Customs Sector from 2008-2010).

4. Reform Program for Organizational Structure, Management, and Human Resource Development

4.1. Reorganizing the Organizational System

a. Objectives

Reorganize units under the General Department of Customs, eliminate overlapping functions and tasks, form provincial and city Customs Departments, promptly meet requirements for redesigning procedures, and serve as a basis for moving towards a modern customs management model.

b. Solutions and activities to achieve the objectives

- Develop strategies and plans to implement reorganization of the Customs organizational system.

- Prepare a proposal to the Government on the organizational structure of the Customs sector and the implementation roadmap for reorganization, ensuring alignment with the Government's and Ministry of Finance's directives on restructuring and the World Bank-funded modernization project's timeline.

- Reorganize departments and bureaus under the General Department in line with streamlined organizational principles and improved operational efficiency.

- Develop and implement proposals to reorganize provincial and city Customs Departments according to the provincial and city Customs Department model; streamline the network of Customs Branches to meet modern customs management requirements.

- Review and improve newly formed organizational structures to meet current management and task requirements.

4.2. Human Resource Management

a. Objectives

Complete the preparation of some basic conditions to implement modern and advanced human resource management.

b. Solutions and activities to achieve the objectives

- Develop and perfect the strategy for human resource management, and the plan to implement the human resource management strategy.

- Organize the implementation of the human resource management strategy during the period of 2008-2010 according to the proposed plan, focusing on the following contents:

+ Develop general and individual job descriptions; establish a mechanism for updating and using job description tables;

+ Develop a system of performance indicators based on job descriptions;

+ Review and evaluate the entire cadre and civil servant workforce according to job requirements;

+ Adjust, supplement, and perfect regulations on cadre management (transfer, rotation, reassignment; planning, appointment; cadre policies, etc.).

- Develop plans and organize the arrangement, allocation, and resolution of benefits for cadres and civil servants in the Customs sector based on job requirements.

- Upgrade the personnel management information system of the Customs sector towards automating certain human resource management tasks and meeting post-restructuring human resource management requirements.

4.3. Training and Development of Human Resources

a. Objectives

Implement the first phase of the training strategy: Establish training bases and programs; improve the teaching staff and curricula; organize training and development according to capabilities, consistent with the process of modernization and restructuring business processes. Focus on specialized training in key areas such as modern customs management, classification of goods, determination of customs value, taxes, post-clearance inspection, intelligence, risk management, intellectual property rights, anti-smuggling control.

b. Solutions and activities to achieve the objectives

- Develop a plan to implement the training strategy.

- Develop standard curricula (basic and advanced) for technical training for customs officers.

- Organize the implementation of the training strategy according to the proposed plan with specific activities to be carried out before 2010, including:

+ Analyze the training needs of customs cadres and civil servants according to the initial phase of the training strategy implementation plan;

+ Standardize curricula and training content according to each position;

+ Standardize teaching materials for customs control operations and other vocational training materials;

+ Organize training according to standardized positions in accordance with the standardized content and curricula.

- Develop and implement the project to transform the organizational model and functions of the current training center into a new suitable model (Vietnam Customs Vocational School).

- Develop a plan and organize training to meet ASEAN regional integration requirements.

- Examine and approve the phased implementation of the training strategy (WB Project and ETV2), prioritizing the establishment of a dedicated teaching staff, development of a curriculum and training materials system, diversification of training methods (distance learning, online), and internationalization of training.

- Develop a proposal to select a team of professionals with expertise and capabilities to undergo basic and postgraduate training both domestically and internationally in specialized customs fields, becoming core forces to meet long-term modernization requirements of the sector, initially focusing on key customs units and the General Department of Customs.

- Continue organizing training in necessary skills and professional knowledge for customs cadres and civil servants at various stages of customs work, information technology, and human resource management.

(Details of each activity in the organizational reform program, management, and human resource development; implementation timeline; lead unit; estimated budget and cooperating units are specified in Appendix 4)

IV. ORGANIZATION AND IMPLEMENTATION OF THE PLAN

4.1. The Steering Committee and the Modernization Reform Committee of Customs (according to Decision No. 1479/QD-BTC dated April 17, 2007 of the Minister of Finance) is responsible for directing the implementation of this Plan.

4.2. The General Department of Taxation, State Treasury, Office of the Ministry, Policy Tax Department, Legal Affairs Department, State Budget Department, Financial Management Department, Cadre Organization Department, Information and Statistics Bureau, and related units under the Ministry shall cooperate with the General Department of Customs in developing annual plans to ensure synchronization with the finance sector's modernization program, allocate sufficient funding, and effectively implement the Plan.

4.3. The General Department of Customs is responsible for:

- Promoting and disseminating this Plan to all levels of leadership and all customs cadres and civil servants within the sector, businesses, and relevant parties to ensure effective implementation;

- Specifying annual tasks according to the proposed timeline; coordinating activities to effectively implement the Plan; guiding, inspecting, and supervising subordinate customs units' implementation of the Plan, annually compiling reports to the Minister of Finance;

- Proactively coordinating with relevant ministries, sectors, and People's Committees of provinces and cities in implementing the Plan;

- Regularly conducting mid-term and final reviews of the Plan's implementation, promptly encouraging units and individuals who perform well, identifying weaknesses for timely correction, and adjusting and supplementing unsuitable goals and timelines.

4.4. The General Department of Customs will continue to develop the Strategy for the Modernization of Vietnam Customs until 2012, with a vision to 2020, to be submitted to the Government for approval.