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Ministry tinkers with new import licensing system
The Ministry of Industry and Trade (MIT) has proposed amendments to a controversial import licensing system that has been accused of costing importers millions of dong.
Under MIT’s proposal, imports used for production will be exempt from the new import licensing system, introduced early last month to reduce the trade deficit.
MIT has proposed the Ministry of Finance and the General Department of Customs limit the categories of imports that need to be registered under the new import licensing system.
The ministry will also open another license issuing office in Ho Chi Minh City to tackle the blockage of applications at MIT’s headquarters in Hanoi.
The new office, to open on October 1, will be at 35 – 37 Ben Chuong Duong Street in District 1.
At present all national businesses, including those from Ho Chi Minh
City and the Mekong Delta City of Can Tho, have to submit import license applications at MIT’s Department of Documents in Hanoi’s Hai Ba Trung Street.
Frustrating system
Officially known as the “automatic licensing regulation,” the new system means companies must obtain licenses to import items such as automobiles, motorbikes, machines, mobile phones, fruit, coffee, tea, cooking oil, meat, sugar, cocoa, some vegetables and some products made from iron, steel and aluminum.
The new regulation came into effect on August 21 and will remain in force until the end of the year. Under MIT’s proposed changes, only imports of items such as perfumes, essential oils, cosmetics, plastic and plastic products, pottery, china, glassware and electrical items must be licensed before they can be collected from customs.
However, the procedure for applying for licenses is tangled and unclear, says Nguyen Manh Cuong, an employee of TK Export and Import Company in the northern Lang Son Province.
Most of the importers say they have to shuffle back and forth to the licensing office in Hanoi three to 10 times to get a license. They are also required to apply for a new license for each batch of goods they import.
“The goods have been spoiled but I still have not got a license,” said an employee of TMV Company, which specializes in importing ice-cream from New Zealand.
“I came here [to receive the license] Friday, yet they asked me to come again today. Now they say they will post it to me so it will take another two days for me to get the license,” he said.
“It is called automatic licensing system, but it is not automatic at all,” said Cuong, who has been in Hanoi for a week waiting for a license.
The time taken to obtain a license means many companies, especially vegetable and fruit importers, are losing money.
“It nearly kills us [vegetable and fruit importers] to wait for 10 days to obtain a license,” said Doan Van L., director of a fruit importer in Lang Son. He said a shipment of his fruit spoiled at the port because he could not get a license.
Nguyen Nga, a representative of TM Company in Hanoi, says her firm is taking substantial losses because of the new licensing system.
Although her company is based in Hanoi and so does not have to pay travel expenses for staff to lodge license applications, her firm is also losing money with at least one customer claiming damages because their order did not arrive on time.
Companies awaiting import licenses can also be hit by customs fees of VND6 million (US$368.40) to VND8 million ($491.20) if goods are left at the port for more than 10 days, Nga said.
Importers are required to submit six kinds of documents to MIT’s Import and Export Department: an application for automatic import license; a business registration certificate; an import contract; a letter of credit (L/C); payment documents or bank payment certificates; a bill of loading or transport documents of goods; and reports on previous imports licensed by MIT together with customs declarations.
Vietnam’s trade deficit stood at US$15.01 billion in the first seven months of this year, soaring 137.7 percent over the same period last year, while its consumer price index rose 21.28 percent, according to the country’s General Statistics Office.
Thanhnien
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