Circular No. 6/TM-XNK guiding additional implementation of Decision No. 78-TTg dated February 28, 1994 of the Prime Minister

CIRCULAR

OF THE MINISTRY OF TRADE

Supplementary Guidelines for Implementing Decision

No. 78/TTg dated February 28, 1994 of the Prime Minister

Following Circular No. 4/TM-XNK dated April 4, 1994 of the Ministry of Trade;

Based on the opinion of the Prime Minister (in Document No. 2448/KTTH dated May 6, 1994);

After reaching consensus with the General Department of Customs, the State Bank, and the Ministry of Trade to adjust and explain certain points in Decision No. 238-TM/XNK dated March 24, 1994 and Circular No. 4-TM/XNK dated April 4, 1994 as follows:

PART I

ISSUES UNDER DECISION NO. 238/TM-XNK

A. AMENDMENTS TO THE DOCUMENTS

I. Prohibited Export Items: At Point I/5, "raw materials" shall be supplemented with "raw material rattan".

II. Prohibited Import Items:

In addition to those items listed in Decision No. 238-TM/XNK, the following items are now added:

1. The importation of two-wheeled motorcycles with cylinder capacity of 175 cubic centimeters or more continues to be governed by the provisions of Decision No. 258-TTg dated May 29, 1993 of the Prime Minister.

2. The Prime Minister has decided not to allow the importation of left-hand drive automobiles (Documents Nos. 3648-KTTH dated July 23, 1993, No. 4915-KTTH dated September 30, 1993, and No. 2415-KTTH dated May 5, 1994).

3. For groups and items that have been used and fall under the scope of Document No. 250-KTTH dated January 19, 1994 of the Government Office, they must comply with the regulations set forth in that document.

B. INTERPRETATION OF THE DOCUMENTS

1. At Point II/1, "explosive materials": Except for Coalimex, which is the sole entity authorized to import 4,200 tons. In this case, the Prime Minister does not need to issue a direct assignment document to Coalimex; only a document from the Ministry of Trade is required. In other cases, there must be a direct assignment document from the Prime Minister to the enterprise, after which the Ministry of Trade will issue guidance documents to the Permit Room.

In both cases, the Permit Room must base its issuance of import permits on the documents from the Ministry of Trade according to Regulation No. 297-TMDL/XNK dated April 9, 1992.

2. At Point II/6, "cigarettes": For enterprises with licenses to operate duty-free shops, the Permit Room issues import permits based on the approval document from the Ministry of Trade according to Regulation No. 297-TMDL/XNK dated April 9, 1992. For transfer imports or temporary imports for re-export, the Permit Room bases its issuance on the approval document from the Prime Minister and the implementation guidance from the Ministry of Trade.

3. At Point II/7, "used consumer goods": This refers to all types of consumer goods, not just those listed in parentheses.

4. At Point II/7, "movable assets" and at Point II/8, "special narrow-range self-propelled vehicles": These issues will be discussed by the Ministry of Trade and the General Department of Customs with relevant ministries as stipulated in Decision No. 238-TM/XNK dated March 24, 1994, and further guidance will be provided later. Until then, the Permit Rooms shall not issue import permits to any enterprise without a direct approval document from the Ministry of Trade.

5. At Point II/7, "old spare parts": This includes old components.

6. For groups and items previously allowed to be imported based on production and business needs but were prohibited from importation as of April 1, 1994, they will be handled according to Circular No. 241-TCHQ/GQ dated March 28, 1994 of the General Department of Customs and the working minutes between the Ministry of Trade and the General Department of Customs regarding the implementation of Decision No. 238-TM/XNK dated March 24, 1994 and Circular No. 4-TM/XNK dated April 4, 1994.

Cases exceeding the scope of Circular No. 241-TCHQ/GQ dated March 28, 1994, the Permit Room will only issue new permits or extend existing permits upon written approval from the Ministry of Trade.

PART TWO

ISSUES UNDER CIRCULAR NO. 4-TM/XNK

A. AMENDMENTS TO THE DOCUMENTS:

I. Regarding Catalogue No. 3:

1. Regarding two-wheeled motorcycles "complete units and parts":

1.1. New motorcycles, complete units:

Pursuant to the government's policy on consolidating import channels for complete motorcycles, the Ministry of Trade stipulates:

a) Each province, centrally-administered city (hereinafter referred to as province), each ministry, agency equivalent to a ministry, and each central agency of mass organizations with export-import enterprises (hereinafter referred to as ministry) shall be designated by the Ministry of Trade one enterprise to import new motorcycles.

Specifically, Ho Chi Minh City, Hanoi, the Ministry of Transport, the Ministry of Trade... (which are commercial centers, transport sectors, specialized trading sectors) may be designated additional enterprises.

With this regulation, in 1994, there will be nearly 100 enterprises nationwide authorized to import complete motorcycles. The selection of enterprises as main importers is based on the following conditions:

Having an export-import business license for the relevant commodity group or specialized automobile and motorcycle business.

Having a high export turnover in 1993 compared to other enterprises with similar licenses within the province or ministry (excluding state-concentrated commodities).

Not violating state regulations and systems in export-import operations in 1992 and 1993.

Submitting application documents to the Ministry of Trade in accordance with Section 2, Point I, Clause B, Part I of Circular No. 4-TM/XNK.

b) The Ministry of Trade will select among these enterprises to designate 14-15 core enterprises in each region and within the ministry sector.

Core enterprises must meet the following additional conditions:

Having many years of import experience, stable supplier customers, and large import volumes.

Directly importing the assigned quantity in 1992 and 1993 (without entrusting other enterprises, and being trusted by other enterprises to entrust them).

1.2. CKD parts for motorcycle assembly:

a) To date, the Ministry of Trade has received nearly 60 sets of applications to import CKD parts for motorcycle assembly. These facilities have the capacity to assemble four times the planned 1994 target. The Ministry of Trade will conduct inspections to verify the accuracy between the applications and actual capabilities to ensure reasonable allocation of import quotas.

To avoid wasting assembly line capacity, the Ministry of Trade requests other enterprises (outside those with submitted applications) not to invest in building additional motorcycle assembly facilities.

b) Initially, the Ministry of Commerce will allocate import quantities of components to enterprises that meet the conditions and have submitted the required documents as stipulated in Circular No. 4-TM/XNK and have been assembling products since before 1993. In cases where assembly facilities have obtained certification from the General Department of Standards-Measurement-Quality but did not assemble products in 1993, provided they have been inspected and are ready for production, such facilities will also be considered for allocation of component imports.

Other assembly facilities that have submitted documents to the Ministry of Commerce will be reviewed after on-site inspection according to the planning and unified product management mechanism between the Ministry of Heavy Industry, the Ministry of Science, Technology and Environment, and the Ministry of Commerce.

1.3. Enterprises allocated the importation of complete motorcycles and components must submit a report to the Ministry of Commerce one month before the import allocation document expires regarding their implementation status. Based on the report and on-site inspection, the Ministry of Commerce will take appropriate measures, including transferring the entire or remaining unexecuted portion to another enterprise.

2.1. Passenger cars under 12 seats, complete units (new type):

Initially, the Ministry of Commerce will allocate importation to nine enterprises based on the principle that the Ministry of Commerce will not pre-allocate quantities; when an enterprise presents a Letter of Credit (L/C), the Ministry of Commerce will issue an import permit according to the quantity stated in the L/C. For large quantities (over 50 units per shipment), enterprises must obtain permission from the Ministry of Commerce prior to signing contracts and opening L/Cs.

2.2. Automobile components in CKD form:

Initially, these will be allocated to enterprises established under the Foreign Investment Law in Vietnam for importation.

3. The importation of passenger cars and complete motorcycles, in exceptional cases differing from the above regulations, will be reviewed and resolved individually by the Ministry of Commerce.

II. Only goods imported under Category 3 may be re-exported with approval documentation from the Ministry of Commerce, and those under Category 4 require approval from specialized management agencies.

III. Regarding the importation of goods outside the four categories specified in Decision No. 238-TM/XNK and Circular No. 4-TM/XNK.

1. Production materials include machinery, equipment, transportation means, spare parts, raw materials, fuel, and materials.

1.1. Enterprises are not allowed to import used goods: spare parts, raw materials, fuel, and materials.

1.2. If an enterprise has a business license for export-import operations in a specific commodity category and imports various types of machinery, transportation means, including used ones (except those regulated by Decision No. 238-TM/XNK) with unit prices up to 10,000 USD, then the Permit Office is responsible for reviewing and issuing import permits.

1.3. If an enterprise has a business license for export-import operations in a specific commodity category and imports equipment, machinery, transportation means, including used ones, with unit prices over 10,000 USD, the Permit Office will only issue import permits upon receiving approval documentation from the Ministry of Commerce.

For certain goods that can be both production materials and consumer goods (for example, monosodium glutamate, shortening oil), they will only be considered production materials if the enterprise submits a document to the Permit Office proving that all imported goods will be used in production.

2. Goods that are not production materials: (this concept replaces the concepts of "consumer goods," "essential consumer goods," and "household items").

2.1. When reviewing applications for voyage permits, the Permit Office bases its decision on the following documents submitted by the enterprise.

Business license for export-import operations in a specific commodity category.

An import request letter confirmed by the Bank regarding the foreign currency balance at the time the enterprise applies for importation.

In the application document, the enterprise must clearly state: name of the imported goods, quantity, value, import market, payment method, currency of payment; confirmed by the Bank regarding the foreign currency balance from export revenues to pay for the imported goods listed in the application document. The Ministry of Commerce will review and resolve each specific and special case, especially if the enterprise has foreign currency balances from other sources of income.

To implement this regulation, all forms of payment under foreign trade purchase-sale contracts must comply with the provisions and guidance of the State Bank.

2.2. In cases where there is already a written permit from the Ministry or a delivery notice received before the Permit Office receives this document, the enterprise does not need to obtain a bank confirmation of foreign currency balances from exports to still be granted a voyage import permit, but the goods must arrive at the Vietnamese border gate no later than June 30, 1994.

3. The importation of various foodstuffs (such as alcohol, beer, and other beverages, fresh or processed vegetables and fruits), miscellaneous goods (such as clothing and textile products, hats, shoes, ceramics, glassware, cosmetics) must still be approved in writing by the Ministry of Commerce.

For enterprises that have imported under Decision No. 405-TM/XNK dated April 13, 1993, if they have a delivery notice, they will be granted an import permit but the goods must arrive no later than June 30, 1994 (this is the final deadline according to Decision No. 405-TM/XNK).

B. EXPLANATION OF THE DOCUMENT:

I. For goods previously self-imported based on production and business needs but now fall under Categories 3 and 4, the following will apply:

If an enterprise has a business license for export-import operations in a specific commodity category, has a delivery notice or transport document, or has opened an L/C before the Permit Office receives this document, it will still be granted an import permit for the remaining quantity but the goods must arrive no later than June 30, 1994.

II. Regarding voyage permits and customs procedures:

1. For imported goods: The Permit Office issues voyage import permits for all imported goods.

2. For exported goods: From July 1, 1994, the Ministry of Commerce will unify with the General Customs Department to abolish the system of voyage export permits.

Except for goods under Categories 1, 2, 3, and 4.

Except for special cases such as goods exchange, re-exported goods, temporarily imported goods for re-export, temporarily exported goods for re-import, transit goods, goods for exhibitions, processing trade goods, and goods of enterprises established under the Law on Foreign Investment in Vietnam.

From now until the end of June is the preparation period (see Point 5 below), so the Permit Departments will continue to issue voyage export permits as usual.

3. When handling customs procedures, enterprises need to have the following documents:

a) For goods subject to voyage permits issued by the Ministry of Trade: in addition to other documents required under the current regulations of the General Department of Customs, only the voyage permit issued by the Permit Department for Import and Export is needed (no approval letter from the Ministry of Trade is required).

b) For goods not subject to voyage permits issued by the Ministry of Trade: in addition to other documents required under the current regulations of the General Department of Customs, there will be no voyage permit issued by the Permit Department; instead, it will be the import and export business license (with seven-digit code) or another document from the Ministry of Trade approving the import and export business.

Starting from the implementation of this new system, when handling customs procedures for the first time, enterprises must submit a certified copy of the import and export business license or a document from the Ministry of Trade approving the import and export business; for subsequent occasions, presenting this license alone is sufficient.

4. For goods not subject to voyage permits issued by the Ministry of Trade (as mentioned in Point 3b above): enterprises must submit an additional customs declaration form. The customs office collects this additional declaration form periodically, once a week, and sends it to the nearest Permit Department for Import and Export. In Hanoi, Haiphong, Da Nang, Nha Trang, Ho Chi Minh City, and Can Tho, the Permit Department for Import and Export will directly visit the customs offices in these cities each week to collect these declarations. The date of submission and delivery of the declaration forms is determined and notified by the customs office to the Permit Department for Import and Export to facilitate receipt. The Permit Department needs to proactively discuss and agree on the work schedule with the local customs authorities.

5. The timing for implementing the abolition of voyage permits for certain export goods:

Before nationwide implementation, pilot programs will be conducted to gather experience. Initially, the Ministry of Trade and the General Department of Customs have agreed to conduct pilot programs at the Hanoi Customs Office, Haiphong Customs Office, and export-import enterprises under the Light Industry Ministry. Enterprises directly under the People's Committee of Hanoi City and the People's Committee of Haiphong City will implement these pilot programs.

The timeline for implementation is as follows:

From April 21, 1994 (after the completion of training sessions) to May 15, 1994, is the preparation period for the pilot program.

From May 16, 1994 to June 15, 1994, is the pilot program period.

From June 16, 1994 to June 30, 1994, is the preparation period for widespread implementation.

Nationwide implementation begins on July 1, 1994.

The provisions set forth in this Circular replace the corresponding provisions in Decision No. 238-TM/XNK dated March 24, 1994, and Circular No. 4-TM/XNK dated April 4, 1994, of the Ministry of Trade.

During the implementation of Decision No. 238-TM/XNK, Circular No. 4-TM/XNK, and this document, the Permit Departments and export-import enterprises are required to regularly report the situation to the Ministry of Trade so that the Ministry can take appropriate and timely measures to adjust and handle issues./.