Circular No. 21/2019/TT-BCT

CIRCULAR

PROVIDING RULES OF ORIGIN UNDER THE ASEAN - HONG KONG, CHINA FREE TRADE AGREEMENT

Pursuant to the Government's Decree No. 98/2017/ND-CP dated August 18, 2017, defining the functions, tasks, powers and organizational structure of the Ministry of Industry and Trade;

Pursuant to the Government's Decree No. 31/2018/ND-CP dated March 8, 2018, detailing the Law on Foreign Trade Management regarding origin of goods;

In implementation of the ASEAN - Hong Kong, China Free Trade Agreement signed on March 28, 2018 in the Union of Myanmar;

At the proposal of the Director of the Import-Export Department,

The Minister of Industry and Trade promulgates the Circular providing rules of origin under the ASEAN - Hong Kong, China Free Trade Agreement.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation

This Circular provides the rules of origin under the ASEAN - Hong Kong, China Free Trade Agreement (hereinafter referred to as AHKFTA).

Article 2. Subjects of application

This Circular applies to:

1. Certificate of Origin (C/O) issuing authorities and organizations.

2. Traders, agencies, organizations and individuals engaged in activities related to origin of goods.

Article 3. Interpretation of terms

For the purposes of this Circular, the following terms are construed as follows:

1. Aquaculture means the farming of aquatic organisms including fish, molluscs, crustaceans, other aquatic invertebrates and aquatic plants, from seedstock such as eggs, fry, fingerlings and larvae, by intervention in the rearing or growth processes to enhance production such as stocking, feeding or protection from predators, etc.

2. CIF means the value of the imported goods inclusive of the cost of freight and insurance up to the port or place of entry into the importing Member State.

3. FOB means the value of the goods free on board, inclusive of the cost of transport to the port or final place of shipment before the carrying vessel leaves.

4. Generally accepted accounting principles means the principles recognised by consensus or applied in a Member State with respect to the recording of revenues, expenses, costs, assets and liabilities; the disclosure of information; and the preparation of financial statements. These principles may encompass broad guidelines as well as specific standards, practices and procedures.

5. Goods means a material or a product wholly obtained or produced, including where it is used as a material in a later production process. In this Circular, the terms “goods” and “product” may be used interchangeably.

6. Identical and interchangeable materials means materials of the same kind and commercial characteristics, having the same physical and technical properties, which, once incorporated into the final product, cannot be distinguished as to origin by markings or by mere visual examination.

7. Material means any substance or article used in the production of goods, physically incorporated into the goods, or employed in the production of other goods.

8. Non-originating material or non-originating goods means material or goods that do not satisfy the rules of origin in this Circular.

9. Originating material or originating goods means material or goods that satisfy the rules of origin in this Circular.

10. Packing materials and containers for transportation means the materials or containers used to protect the goods during transportation, other than the packaging materials and containers for the retail sale of the goods.

11. Tariff preference means the reduction of customs duties on originating goods, reflected in the corresponding duty rates under AHKFTA.

12. Production means the methods of obtaining goods, including growing, mining, harvesting, raising, breeding, extracting, gathering, aquaculture, collecting, capturing, fishing, trapping, hunting, manufacturing, producing, processing or assembling goods.

13. Product specific rules (PSR) means the rules provided in Appendix I issued together with this Circular. In order to determine the origin of goods, the materials used in the production of those goods must satisfy one of the following origin criteria:

a) A change in tariff classification (CTC);

b) A specific working or processing operation (SP);

c) A regional value content (RVC);

d) A combination of the criteria referred to at Points a, b and c of this Clause.

14. Back-to-back C/O form AHK (MC) means the C/O issued by an intermediate exporting Member State on the basis of the original C/O form AHK of the first exporting Member State.

15. Exporter means a natural or legal person located in the territory of a Member State from which the goods are exported by that person.

16. Importer means a natural or legal person located in the territory of a Member State into which the goods are imported by that person.

17. Producer means a natural or legal person responsible for production in the territory of a Member State.

18. Minimal means an operation that requires no special skill, or machines, apparatus or equipment especially produced or installed to carry out that operation.

19. Simple mixing means an operation that requires no special skill, or machines, apparatus or equipment especially produced or installed to carry out that operation. Simple mixing does not include chemical reactions. A chemical reaction is a process (including a biochemical process) which results in a molecule with a new structure by breaking intramolecular bonds and forming new intramolecular bonds, or by altering the spatial arrangement of atoms in a molecule.

20. Slaughter of animals means the killing of animals and the subsequent processes such as cutting, chilling, freezing, salting, drying or smoking, for the purpose of preservation for transport or storage.

Article 4. Certification and verification of origin of goods in Viet Nam

1. Issued together with this Circular are the following Appendices:

a) Appendix I: Product Specific Rules;

b) Appendix II: Form of C/O form AHK;

c) Appendix III: Instructions for completing the C/O form AHK for exported goods;

d) Appendix IV: List of Viet Nam's C/O form AHK issuing authorities and organizations;

dd) Appendix V: Minimum information requirements.

2. The list of Viet Nam's C/O form AHK issuing authorities and organizations is provided in Appendix IV issued together with this Circular and is updated on the electronic origin certification and management system of the Ministry of Industry and Trade at www.ecosys.gov.vn. The C/O form AHK issuing authorities and organizations shall register their specimen seals and signatures and update those specimen seals and signatures in accordance with the regulations of the Ministry of Industry and Trade.

3. The procedures for certifying and verifying the origin of goods shall comply with the Government's Decree No. 31/2018/ND-CP dated March 8, 2018, detailing the Law on Foreign Trade Management regarding origin of goods, and the relevant regulations.

Chapter II

RULES OF ORIGIN

Article 5. Originating goods

Goods imported into a Member State from another Member State are considered originating if they satisfy one of the following rules of origin and the other provisions of this Circular:

1. They are wholly obtained or produced entirely in the exporting Member State under Article 6 of this Circular.

2. They are produced in the exporting Member State exclusively from originating materials of one or more Member States.

3. They are produced from non-originating materials in the exporting Member State, provided that those goods satisfy Article 7 of this Circular.

Article 6. Wholly obtained goods

For the purposes of Clause 1, Article 5 of this Circular, goods are considered wholly obtained or produced entirely in the exporting Member State in the following cases:

1. Plants and plant products (including fruit, flowers, vegetables, trees, seaweed, fungi and plants) grown, harvested, picked or gathered in a Member State.

2. Live animals (including mammals, birds, fish, crustaceans, molluscs, reptiles, bacteria and viruses) born and raised in a Member State.

3. Products obtained from live animals in a Member State.

4. Products obtained from hunting, trapping, fishing, farming, aquaculture, gathering or capturing in a Member State.

5. Minerals and other naturally occurring substances extracted or taken from the soil, waters, seabed or beneath the seabed of a Member State, not including the products referred to in Clauses 1 to 4 of this Article.

6. Marine products taken by vessels registered in the exporting Member State and entitled to fly the flag of that Member State, and minerals and other naturally occurring substances taken from the waters, seabed or beneath the seabed outside the territorial waters of the exporting Member State, provided that that Member State has the right to exploit those waters, seabed and subsoil under international law. International law means generally recognised international law, including the 1982 United Nations Convention on the Law of the Sea.

7. Marine products and other products taken from the high seas by vessels registered in a Member State and entitled to fly the flag of that Member State.

8. Products processed or produced on board a factory ship registered in a Member State or flying the flag of a Member State from the products referred to in Clause 7 of this Article.

9. Goods that are waste and scrap derived from production or consumption in a Member State and fit only for use as raw materials or for recycling.

10. Used goods collected in a Member State, provided that those goods are fit only for use as raw materials or for recycling.

11. Goods obtained or produced in the exporting Member State exclusively from the products referred to in Clauses 1 to 10 of this Article.

Article 7. Not wholly obtained goods

1. The goods referred to in Clause 3, Article 5 of this Circular, other than the goods provided in Clause 2 of this Article, are considered originating if they have an RVC of not less than 40% calculated in accordance with Article 8 of this Circular.

2. Goods are considered originating if they satisfy the origin criterion provided in Appendix I issued together with this Circular.

Article 8. RVC formula

1. RVC is the regional value content, expressed as a percentage. The RVC is calculated as follows:

a) Direct formula:

or

b) Indirect formula:

Viet Nam applies the indirect RVC formula under Point b, Clause 1 of this Article to determine the origin of goods exported under AHKFTA.

2. For the purposes of the RVC formula referred to in Clause 1 of this Article:

a) AHKFTA material cost is the value of the originating materials, parts or goods used in the production, whether purchased by the producer or self-produced.

b) VNM is the CIF price at the time of importation, or the earliest ascertainable price paid by the producer, for the non-originating materials, parts or goods used in the production. Non-originating materials include materials of undetermined origin.

c) Direct labour cost includes wages, remuneration and other employee benefits related to the production process.

d) Direct overhead cost includes, but is not limited to, plant costs relating to the production process (insurance, short-term and long-term factory rent, depreciation of buildings, repairs, maintenance, taxes, mortgage interest); long-term hire purchase and interest payments for plant and plant equipment; factory security; insurance (plant, equipment and materials used in the production of the goods); utilities for the production process (energy, electricity, water and other utilities directly contributing to the production of the goods); research, development, design and engineering; dies, moulds, tooling and the depreciation, maintenance and repair of plant and equipment; patent royalties (in respect of patented machinery or processes used in the production of the goods, or the right to produce the goods); inspection and testing of materials and goods, storage and handling in the factory; disposal of recyclable waste; and cost elements in the calculation of the value of the materials, such as port costs, cargo clearance costs and import duties on dutiable components.

dd) Other costs are the costs incurred in placing the goods on board a ship or other means of transport for export, including but not limited to domestic transport costs, storage and warehousing costs, port costs, commission fees and service charges.

3. The value of goods under this Circular is determined in accordance with the Customs Valuation Agreement.

Article 9. Cumulation

Goods that satisfy the rules of origin of a Member State and are used in another Member State as materials to produce goods eligible for tariff preferences are considered to originate in the Member State where the final goods were produced or processed.

Article 10. Minimal operations and processes

1. Goods are not considered originating in the territory of a Member State where the following operations are carried out, singly or in combination, in the territory of that Member State:

a) Operations to preserve the goods in good condition during transport and storage;

b) Changes of packaging, and the breaking-up and assembly of packages;

c) Simple washing, cleaning, removal of dust, oxide, oil, paint and other coatings or coverings;

d) Simple painting and polishing operations;

dd) Husking, hulling, partial or total bleaching, polishing and glazing of cereals and rice;

e) Colouring of sugar or forming sugar lumps;

g) Simple peeling, stoning or shelling;

h) Sharpening, simple grinding or simple cutting;

i) Sifting, screening, sorting, classifying, grading, matching;

k) Simple placing in bottles, cans, flasks, bags, cases or boxes, fixing on cards or boards and all other simple packaging operations;

l) Affixing or printing marks, labels or logos and other like distinguishing signs on the products or on their packaging;

m) Simple mixing of products, whether or not of different kinds;

n) Simple assembly of parts of a product to constitute a complete product, or the disassembly of a product into its parts;

o) Simple testing or calibration; or

p) Slaughter of animals.

2. Goods originating in the territory of a Member State retain their original origin when exported from the other Member State where the minimal operations and processes referred to in Clause 1 of this Article are carried out.

Article 11. Direct consignment

1. Goods are eligible for tariff preferences if they fully satisfy this Circular and are consigned directly from the exporting Member State to the importing Member State.

2. The following are considered direct consignment from the exporting Member State to the importing Member State:

a) The goods are transported directly from an exporting Member State to an importing Member State; or

b) The goods are transported through one or more other Member States or through a non-Member State and satisfy the following conditions:

- The transit is justified for geographical reasons or by transport requirements;

- The goods do not enter into trade or consumption there;

- The goods do not undergo any operation or processing other than unloading and reloading, or operations required to keep the goods in good condition.

Article 12. De Minimis

1. Goods that do not satisfy the CTC criterion are nevertheless considered originating goods if the value of all the non-originating materials used in the production of the goods that do not satisfy the CTC criterion does not exceed 10% of the FOB value of the goods and those goods satisfy the other rules of origin in this Circular.

2. Where the goods are assessed under the RVC criterion, the value of the non-originating materials referred to in Clause 1 of this Article is nevertheless counted as the value of non-originating materials.

Article 13. Packing materials and containers

1. Where packing materials and containers are used for transportation, they need not be taken into account in determining the origin of the goods.

2. Where packing materials and containers are used to package the goods for retail sale and are classified together with the goods, they need not be taken into account in determining the origin of the goods, provided that:

a) The goods are wholly obtained under Clause 1, Article 5 of this Circular;

b) The goods are produced entirely in the territory of a Member State under Clause 2, Article 5 of this Circular;

c) The goods satisfy the CTC criterion under Appendix I issued together with this Circular.

3. Where the goods are assessed under the RVC criterion, the value of the packing materials and containers used to package the goods for retail sale must be taken into account in determining the origin of the goods.

Article 14. Accessories, spare parts and tools

1. Where the CTC criterion or the SP criterion applies to the goods, the origin of the accessories, spare parts, tools and instructional or other informational materials presented with those goods need not be taken into account in determining the origin of the goods, provided that:

a) Those accessories, spare parts, tools and materials are invoiced together with the goods;

b) The quantity and value of those accessories, spare parts, tools and materials are customary for the goods.

2. Where the RVC criterion applies to the goods, the value of the accessories, spare parts, tools and instructional or other informational materials presented with those goods is counted as the value of originating or non-originating materials when calculating the RVC, as the case may be.

Article 15. Neutral elements

In determining the origin of goods, the origin of the following neutral elements used in the production but not incorporated into the goods need not be determined:

1. Fuel and energy.

2. Tools, dies and moulds.

3. Spare parts and materials used to maintain equipment and buildings.

4. Lubricants, greases, compounding materials and other materials used in production or used to operate equipment and buildings.

5. Gloves, glasses, footwear, clothing, safety supplies and equipment.

6. Equipment, machinery and supplies used to test or inspect the goods.

7. Catalysts and solvents.

8. Any other materials not incorporated into the product but whose use in the production of the product can be demonstrated to be necessary for that production.

Article 16. Identical and interchangeable materials

1. The determination of whether identical and interchangeable materials used in the production are originating materials must be made by physically segregating each of those materials or by applying generally accepted accounting principles on stock control, or the inventory management practices of the exporting Member State.

2. Once a stock-control accounting method has been chosen, that method must be used throughout that financial year.

Chapter III

PROCEDURES FOR CERTIFYING AND VERIFYING THE ORIGIN OF GOODS

Article 17. Pre-exportation examination

The exporter or producer of goods eligible for tariff preferences may request the C/O issuing authority or organization to examine and verify the origin before exportation. The result of the examination and verification, carried out periodically or where necessary, is accepted as supporting evidence of the origin of the goods to be exported thereafter. This examination may be waived for goods whose origin can readily be determined by their nature.

Article 18. Submission of the C/O application dossier

At the time of carrying out the export procedures for goods eligible for tariff preferences, the exporter or an authorised person shall submit an application for a C/O form AHK, in paper or electronic form, together with the documents necessary to prove that the exported goods satisfy the conditions for the issuance of a C/O form AHK.

Article 19. Examination of the C/O application dossier

The C/O issuing authority or organization shall examine each application for a C/O form AHK to ensure that:

1. The origin of the goods conforms to this Circular.

2. The other information on the C/O form AHK conforms to the supporting documents.

3. The description of the goods, the quantity and weight of the goods, the marks and numbers of the packages, and the number and kind of packages declared conform to the goods being exported.

4. The C/O application and the C/O form AHK are completed in full and are signed manually or electronically by an authorised person.

Article 20. C/O form AHK

To enjoy tariff preferences, the goods must be covered by a C/O form AHK issued by the competent authority or organization of the exporting Member State.

1. The C/O form AHK is in the form provided in Appendix II, developed by the Member States on the basis of the minimum information requirements provided in Appendix V issued together with this Circular.

2. The C/O form AHK comprises 1 Original and 2 copies.

3. The C/O form AHK must satisfy the following conditions:

a) Being in paper form;

b) Bearing a reference number specific to each C/O issuing authority or organization;

c) Being completed in English;

d) Bearing the signature of an authorised person and the seal of the C/O issuing authority or organization. That specimen signature and seal may be in electronic form.

4. Where the RVC criterion applies, the FOB value of the goods must be stated on the C/O form AHK for goods exported from one ASEAN Member State to another ASEAN Member State and from Hong Kong, China to ASEAN Member States, but need not be stated for goods exported from ASEAN Member States to Hong Kong, China.

5. The original C/O form AHK is sent by the exporter to the importer for submission to the customs authority of the importing Member State. The two copies are retained by the C/O issuing authority or organization of the exporting Member State and by the exporter.

6. Several goods may be declared on the same C/O form AHK, provided that each of those goods satisfies the origin requirements applicable to it.

Article 21. Handling of errors on the C/O form AHK

Erasures and superimpositions on the C/O form AHK are not permitted. Any alteration must be made in one of the following two ways:

1. Striking out the error and adding the necessary information. Such alterations must be approved by the person authorised to sign the C/O form AHK and certified by the C/O issuing authority or organization. Unused spaces must be crossed out to prevent any subsequent addition.

2. Issuing a new C/O form AHK to replace the previous one.

Article 22. Issuance of the C/O form AHK

1. The C/O form AHK is issued by the C/O issuing authority or organization of the exporting Member State before or at the time of shipment, but no later than 3 working days after the date of shipment.

2. Where the C/O form AHK is not issued at the time referred to in Clause 1 of this Article because of an involuntary error or other valid reason, the C/O form AHK may be issued retroactively, but no later than 1 year from the date of shipment, and must be ticked in Box 13 where the words “ISSUED RETROACTIVELY” appear.

Article 23. Back-to-back C/O form AHK

The C/O issuing authority or organization of an intermediate Member State shall issue a back-to-back C/O at the request of the exporter while the goods are being transported through the territory of that Member State, provided that:

1. A valid original C/O form AHK or a valid certified true copy is presented;

2. The validity period of the back-to-back C/O does not exceed the validity period of the original C/O form AHK.

3. The goods re-exported under a back-to-back C/O form AHK must remain under the control of the intermediate Member State. That control includes documentary control or any risk management procedure required by the competent authority of the intermediate Member State. The goods re-exported under a back-to-back C/O form AHK must not undergo any other processing operation in the intermediate Member State, other than repacking or logistics activities such as unloading, reloading, storing or any other operation necessary to keep the goods in good condition or to transport them to the importing Member State.

4. The back-to-back C/O contains the information relating to the original C/O form AHK, developed on the basis of the minimum information requirements provided in Appendix V issued together with this Circular. The FOB value is the FOB value of the goods exported from the intermediate exporting Member State.

5. Where the information is incomplete or there is a suspicion of a violation of law, the competent authority of the final importing Member State may request the original C/O form AHK.

6. The origin verification procedures provided in Article 30 of this Circular also apply to back-to-back C/O.

Article 24. C/O form AHK that is lost, stolen or damaged

Where the C/O form AHK is lost, stolen or damaged, the exporter may apply to the C/O issuing authority or organization for a certified true copy of the original C/O form AHK or of its copies. The certified true copy is issued on the basis of the export documents retained by the C/O issuing authority or organization and must bear the words “CERTIFIED TRUE COPY”. The certified true copy bears the date of issuance of the original C/O form AHK and is issued within 1 year from the date of issuance of the original C/O form AHK.

Article 25. Submission of the C/O form AHK

1. To claim tariff preferences under the law of the importing Member State, at the time of carrying out the import procedures the importer must submit to the customs authority of the importing Member State the customs declaration, the C/O form AHK and the other necessary documents (including the commercial invoice and, where required, the bill of lading or the relevant transport document) issued in the territory of the exporting Member State, and the other documents required by the law of the importing Member State.

2. Where the C/O form AHK is rejected, the customs authority of the importing Member State shall tick the relevant item in Box 4 of the C/O form AHK, and the original C/O form AHK must be returned to the C/O issuing authority or organization within a reasonable period not exceeding 60 days from the date of rejection of the C/O. The C/O issuing authority or organization must be informed of the reason for denying tariff preferences.

3. Where the C/O form AHK is rejected as referred to in Clause 2 of this Article, the importing Member State must accept and consider the explanations of the C/O issuing authority or organization in order to reassess whether the C/O is eligible for tariff preferences. The explanations of the C/O issuing authority or organization must be detailed and must address the issues raised by the importing Member State. Where the explanations of the C/O issuing authority or organization satisfy the requirements of this Circular, the importing Member State must accept the C/O form AHK and grant the goods tariff preferences in accordance with the law of that Member State.

Article 26. Validity of the C/O form AHK

1. The time limit for submitting the C/O form AHK is as follows:

a) The C/O form AHK is valid for 1 year from the date of issuance and shall be submitted to the customs authority of the importing Member State within that period;

b) Where the C/O form AHK is submitted to the customs authority of the importing Member State after the expiry of its validity period, it is nevertheless accepted if the failure to observe that time limit is due to force majeure or other valid causes beyond the control of the importer or the exporter.

2. In all cases, the customs authority of the importing Member State may accept the C/O form AHK provided that the goods were imported before the expiry of the validity period of that C/O.

Article 27. Waiver of the C/O form AHK

1. Goods originating in the exporting Member State with an FOB value not exceeding 200 US dollars are exempt from the C/O form AHK and only a simple declaration by the exporter that the goods originate in the exporting Member State is required. Goods sent by post with an FOB value not exceeding 200 US dollars are also subject to this provision.

2. In addition to the case provided in Clause 1 of this Article, a Member State may choose not to require the submission of a C/O form AHK.

Article 28. Treatment of minor discrepancies

1. Where there is no doubt as to the origin of the goods, minor discrepancies such as typing errors appearing on the C/O form AHK or errors on the documents in the dossier submitted to the customs authority of the importing Member State for the import procedures do not invalidate the C/O form AHK if those discrepancies correspond to the goods actually imported.

2. Where there is a difference in the tariff classification (HS code) between the exporting Member State and the importing Member State, the imported goods shall be cleared subject to the most-favoured-nation (MFN) import duty rate or the AHKFTA special preferential import duty rate, depending on whether the applicable rules of origin are satisfied, and the importer shall not be penalised or subjected to any additional charge under the law of the importing Member State. Once the difference in HS classification has been clarified, the AHKFTA preferential import duty rate applies and any duty paid in excess is refunded in accordance with the law of the importing Member State.

3. Where several items are declared on a C/O form AHK, an issue with one item does not affect or obstruct the granting of the preferential duty rate and the clearance of the remaining items. The item at issue shall be handled in accordance with Point c, Clause 1, Article 30 of this Circular.

Article 29. Record keeping

1. For the purposes of the origin verification under Article 30 of this Circular, the producer or the exporter applying for a C/O form AHK must retain the C/O application dossier and documents for at least 3 years from the date of issuance of the C/O form AHK, in accordance with the law of the exporting Member State.

2. The C/O form AHK application dossier and all the related documents shall be retained by the C/O issuing authority or organization for at least 3 years from the date of issuance.

3. Information relating to the validity of the C/O form AHK shall be provided by the C/O issuing authority or organization of the exporting Member State at the request of the importing Member State.

4. Any information communicated between the Member States concerned must be kept confidential and used only for the validation of the C/O form AHK.

Article 30. Retroactive check after the issuance of the C/O

1. The competent authority of the importing Member State may request the competent authority of the exporting Member State to carry out a check at random or where it has reason to doubt the authenticity of the document or the accuracy of the information regarding the origin of the goods or of parts of those goods. On the request of the importing Member State, the competent authority of the exporting Member State shall carry out the verification of the exporter or the producer subject to the following conditions:

a) The request for a check must be accompanied by the C/O form AHK concerned and must state the reason and any additional information suggesting that the particulars given on that C/O may be inaccurate, except in the case of a random check.

b) The competent authority of the exporting Member State shall promptly acknowledge receipt of the request for a check and shall notify the result to the importing Member State within 90 days from the date of receipt of the request.

c) The competent authority of the importing Member State may suspend the granting of tariff preferences while awaiting the result of the check. However, the competent authority of the importing Member State may allow the importer to clear the goods subject to the necessary administrative measures, provided that the goods are not subject to import prohibition or restriction and there is no suspicion of origin fraud. Where the importing Member State determines that the goods are originating, the granting of tariff preferences shall resume.

d) Upon receipt of the check result from the exporting Member State, the competent authority of the importing Member State must determine whether the goods are originating. The entire verification process, including the notification of the determination as to whether the goods are originating to the competent authority of the exporting Member State, must be completed within 180 days from the date of receipt of the request for a check.

2. Where the competent authority of the importing Member State does not agree with the check result referred to in Clause 1 of this Article, in certain cases the importing Member State may request a verification visit to the production facility in the exporting Member State, provided that:

a) Before conducting the verification visit, the competent authority of the importing Member State must send a written notice to:

- The exporter or the producer whose premises are to be visited;

- The competent authority of the exporting Member State;

- The importer of the goods subject to the verification.

The above written notice must be complete and contain the following:

- The name and details of the competent authority requesting the visit;

- The name of the exporter or the producer to be visited;

- The proposed date of the visit;

- The purpose and scope of the visit, including the specific parameters of the goods to be verified;

- The names and titles or positions of the officials of the importing Member State conducting the visit.

Before conducting the verification visit, the competent authority of the importing Member State must obtain the written consent of the exporter or the producer to be visited.

b) Where written consent to the visit is not received from the exporter or the producer within 30 days from the date on which the exporter or the producer received the written notice of the visit referred to at Point a, Clause 2 of this Article, the importing Member State may deny preferences for the goods subject to the verification.

c) The competent authority of the exporting Member State that receives the request for a verification visit may postpone the visit and notify the competent authority of the importing Member State. Where there is no postponement, the verification visit shall be conducted in accordance with the law of the exporting Member State within 60 days from the date of receipt of the written notice of the visit. That period may be extended where the parties so agree. The verification visit must be agreed by the competent authorities of the importing Member State and the exporting Member State.

d) The competent authority of the importing Member State conducting the verification visit must send the exporter or the producer and the competent authority of the exporting Member State its determination as to whether the goods are originating.

dd) The suspension of tariff preferences shall be resolved on the basis of the determination that the goods are originating referred to at Point d, Clause 2 of this Article.

e) The exporter or the producer may, within 30 days from the date of receipt of a determination that the goods are not originating, provide additional information to the competent authority of the importing Member State to demonstrate that the goods are originating. Where the goods are still determined not to be originating, the final determination shall be sent by the competent authority of the importing Member State to the competent authority of the exporting Member State within 30 days from the date of receipt of the additional information from the exporter or the producer.

g) The verification visit process, including the on-site verification and the determination as to whether the goods are originating, must be carried out and notified to the competent authority of the exporting Member State within 180 days from the receipt of the written notice of the visit referred to at Point a, Clause 2 of this Article. While awaiting the result of the verification visit, Point c, Clause 1 of this Article on the suspension of tariff preferences applies.

3. Each Member State must keep confidential the information and documents relating to the origin verification referred to in Clauses 1 and 2 of this Article and must protect that information from disclosure, as disclosure could prejudice the competitive position of the person providing it. Such information and documents must not be used for other purposes, including in administrative or criminal proceedings, without the written consent of the Member State providing them.

Article 31. Documents for the direct consignment rule

For the purposes of Article 11 of this Circular, where the goods are transported through the territory of one or more countries that are not AHKFTA Member States, the following documents must be submitted to the competent authority of the importing Member State:

1. The bill of lading or the relevant transport documents issued in the exporting Member State.

2. The C/O form AHK issued by the relevant C/O issuing authority or organization of the exporting Member State, except where the C/O is waived under Article 27 of this Circular.

3. A copy of the original commercial invoice for the goods.

4. Documents proving that the transport satisfies the requirements set out at Point b, Clause 2, Article 11 of this Circular.

Article 32. Exhibition goods

1. Goods sent from an exporting Member State for exhibition in another Member State and sold during or after the exhibition for importation into a Member State enjoy tariff preferences under AHKFTA, provided that those goods satisfy the rules of origin requirements in this Circular and it is demonstrated to the relevant customs authority of the importing Member State that:

a) The exporter consigned those goods from the territory of the exporting Member State to the Member State where the exhibition was held and the goods were exhibited there;

b) The exporter sold or otherwise disposed of those goods to a consignee in the importing Member State;

c) The goods were consigned to the importing Member State during the exhibition or immediately after it in the same state as they were sent for exhibition.

2. For the purposes of Clause 1 of this Article, the C/O form AHK shall be submitted to the competent authority of the importing Member State, stating the name and address of the place where the exhibition was held. The competent authority or the relevant customs authority of the Member State where the exhibition took place may issue a form of certification together with the documents provided in Clause 4, Article 31 of this Circular to confirm the goods and the conditions of their participation in the exhibition.

3. Clause 1 of this Article applies to any trade, agricultural or craft exhibition, fair or similar show or display, or to displays in shops or business premises for the sale of products, where the products remain under customs control throughout the exhibition.

Article 33. Third-party invoicing

1. The competent authority of the importing Member State shall accept the C/O form AHK where the commercial invoice is issued by a company located in a third country, or by an exporter on behalf of that company, provided that the goods satisfy the rules of origin requirements in this Circular.

2. The exporter must tick the “Third party invoicing” box and state information such as the name and the country/party of the company issuing the commercial invoice on the C/O form AHK.

Chapter IV

IMPLEMENTATION PROVISIONS

Article 34. Organization of implementation

1. Guidance, explanations and clarifications relating to the Rules of Origin Chapter agreed among the Member States by rotation, or agreed in the reports of the implementation meetings of the Joint Committee and the Sub-Committee on Rules of Origin under AHKFTA, are regarded as the basis for implementation by C/O issuing authorities and organizations and by customs authorities.

2. The matters referred to in Clause 1 of this Article shall be notified to the C/O issuing authorities and organizations and to the customs authorities through the focal agency implementing AHKFTA under Article 3 of the Government's Resolution No. 03/NQ-CP dated January 7, 2019 approving the ASEAN - Hong Kong, China Free Trade Agreement.

Article 35. Implementation provisions

1. This Circular takes effect from December 23, 2019.

2. The C/O issuing authorities and organizations shall consider issuing C/O form AHK for goods exported from Viet Nam before the effective date of this Circular so that they may enjoy tariff preferences under AHKFTA and under the regulations of the importing Member State.

3. The customs authority of the importing Member State shall accept C/O form AHK issued from June 11, 2019. The procedures for examining the C/O form AHK for the granting of tariff preferences shall comply with AHKFTA, Chapter III of this Circular and the other relevant legal documents./.

APPENDIX I

PRODUCT SPECIFIC RULES (issued together with Circular No. 21/2019/TT-BCT dated November 8, 2019 of the Minister of Industry and Trade providing rules of origin under AHKFTA)

1. A heading or subheading to which the Product Specific Rules (PSR) apply must satisfy one of the criteria provided in this Appendix. Where the PSR offer a choice of the RVC criterion, the CTC criterion, the SP criterion, or any combination of those criteria, the exporter may choose the appropriate criterion to determine the origin of the goods.

2. The CTC criterion or the SP criterion applies only to non-originating materials.

3. The CTC criterion, including the exclusion of certain changes in tariff classification, applies only to non-originating materials.

4. In the column “Origin criterion” of this Appendix, the following terms are construed as follows:

WO means goods wholly obtained or produced entirely under Article 6 of this Circular;

RVC (XX) means a regional value content of the goods of not less than XX per cent calculated in accordance with Article 8 of this Circular;

CC means a change in HS code at the 2-digit level (change of Chapter) of the Harmonized Commodity Description and Coding System for all the non-originating materials used in the production of the goods;

CTH means a change in HS code at the 4-digit level (change of Heading) of the Harmonized Commodity Description and Coding System for all the non-originating materials used in the production of the goods;

CTSH means a change in HS code at the 6-digit level (change of Subheading) of the Harmonized Commodity Description and Coding System for all the non-originating materials used in the production of the goods.

APPENDIX III

INSTRUCTIONS FOR COMPLETING THE EXPORT C/O FORM AHK (issued together with Circular No. 21/2019/TT-BCT dated November 8, 2019 of the Minister of Industry and Trade providing rules of origin under AHKFTA)

The C/O form AHK must be completed in English and typed (except as guided in Clause 15 below). The contents declared must conform to the customs declaration for which customs procedures have been completed and to other documents such as the bill of lading, the commercial invoice and the origin inspection record (where an inspection is required). The C/O form AHK is completed as follows:

1. The top right-hand box “Certificate No.”: state the reference number (entered by the C/O issuing authority or organization). The reference number consists of 13 characters in 5 groups, as follows:

a) Group 1: the abbreviation of the exporting Member State, Viet Nam, consisting of 02 characters “VN”;

b) Group 2: the abbreviation of the importing Member State among the AHKFTA member states, consisting of 02 characters as follows:

c) Group 3: the year of issuance of the C/O form AHK, consisting of 02 characters. For example, issuance in 2019 is written as “19”;

d) Group 4: the code of the C/O issuing authority or organization, consisting of 02 characters. The list of Viet Nam's C/O form AHK issuing authorities and organizations is set out in Appendix IV issued together with this Circular;

dd) Group 5: the serial number of the C/O form AHK, consisting of 05 characters;

e) Groups 1 and 2 are separated by a hyphen “-”; groups 3, 4 and 5 are separated by an oblique stroke “/”.

Example: where the Import-Export Management Office of the Hanoi region issues the 8th C/O form AHK for a consignment exported to Hong Kong, China in 2019, the reference number of that C/O is written as: “VN-HK 19/01/00008”.

2. Box 1: the trading name of the exporter, the address and the name of the exporting Party/Member State (Viet Nam).

3. Box 2: the name of the consignee, the address and the name of the importing Party/Member State.

4. Box 3: the date of departure, the name of the means of transport (if sent by air, state “By air”; if sent by sea, state the name of the vessel) and the name of the port of loading and discharge.

5. Box 4: leave blank.

6. Box 5: the serial number of each item.

7. Box 6: the marks and numbers of the packages.

8. Box 7:

- The number of packages, the kind of packages and the description of the goods (including the HS code at the 6-digit level; and, if any, the product number, product name and brand name). The description of the goods must be sufficiently detailed for the customs authority of the importing Member State to identify them.

- The name of the producer and the trade mark of the goods must be stated clearly.

- The name and the country/party of the company issuing the third-party invoice (if any).

9. Box 8: the origin criterion of the goods

10. Box 9: the quantity (gross weight or net weight of the goods or another unit of measurement), and the FOB value (where the RVC criterion applies); for goods exported from an ASEAN Member State to Hong Kong, China, the FOB value need not be stated in Box 9.

11. Box 10: the number and date of the commercial invoice. The commercial invoice is normally the invoice issued for the goods imported into the importing Party/Member State. Where a third-party invoice is used, the invoice number is stated in Box 10 as guided in Clause 14 of this Appendix.

12. Box 11:

a) The first line states “Viet Nam” where a C/O form AHK is issued, or the Party/Country of origin where a back-to-back C/O form AHK is issued;

b) The second line states the full name of the importing Party/Member State;

c) The third line states the place and date of the application for the C/O and the full name and signature of the trader applying for the C/O.

13. Box 12: the C/O form AHK issuing authority or organization states: the place and date of issuance of the C/O, the signature of the C/O issuing officer and the seal of the C/O issuing authority or organization.

14. Box 13:

a) Where a C/O is issued retroactively under Article 22 of this Circular, tick “√” in the “Issued Retroactively” box in Box 13.

b) Where the goods are sent from the exporting Member State for exhibition in another Member State and sold during or after the exhibition into an importing Member State under Article 32 of this Circular, tick “√” in the “Exhibition” box in Box 13. The name and address of the place of the exhibition are stated in Box 2;

c) Where the goods are covered by a back-to-back C/O form AHK under Article 23 of this Circular, tick “√” in the “Movement Confirmation” box in Box 13.

d) Where the invoice is issued by a third party under Article 33 of this Circular, tick “√” in the “Third Party Invoicing” box in Box 13. The name and the party/country of the company issuing the invoice are stated in Box 7 or, where there is insufficient space, on the supplementary declaration sheet. The number of the invoice issued by the producer or the exporter, or the number of the third-party invoice issued by the trader for the goods imported into the importing Party/Member State, is stated in Box 10.

dd) Where cumulation under Article 9 of this Circular applies, tick “√” in the “Accumulation” box in Box 13.

e) Where the goods satisfy the De Minimis rule under Article 12 of this Circular, tick “√” in the “De Minimis” box in Box 13.

15. Other instructions: Box 13 may be ticked “√” by hand or printed by computer.

APPENDIX IV

LIST OF VIET NAM'S C/O FORM AHK ISSUING AUTHORITIES AND ORGANIZATIONS (issued together with Circular No. 21/2019/TT-BCT dated November 8, 2019 of the Minister of Industry and Trade providing rules of origin under AHKFTA)

APPENDIX V

MINIMUM INFORMATION REQUIREMENTS (issued together with Circular No. 21/2019/TT-BCT dated November 8, 2019 of the Minister of Industry and Trade providing rules of origin under AHKFTA)

The proof of origin used as the basis for claiming tariff preferences under AHKFTA shall contain the following information:

1. Exporter

The name, address, the name of the Party/Member State and the details of the exporter.

2. Consignment information (each C/O form AHK applies to one consignment only)

a) The name of the consignee, the address and the name of the Party/Member State.

b) Sufficient information to identify the consignment, such as the importer's purchase order number, the number and date of issuance of the commercial invoice, and the air waybill or the bill of lading.

c) The port of discharge, as far as known.

3. Description of the goods

a) The marks and numbers of the packages.

b) A detailed description of the goods including the HS code of the goods at the 6-digit level; and, if any, the product number and the brand name.

c) The relevant origin criterion.

d) The quantity of the goods.

dd) The FOB value (where the RVC criterion applies), except that for goods exported from an ASEAN Member State to Hong Kong, China the FOB value need not be stated.

4. Certification by the C/O issuing authority or organization

On the basis of the documents provided, the C/O issuing authority or organization certifies that the goods stated on the C/O form AHK satisfy the rules of origin in this Circular and states the date of issuance of the C/O form AHK.

5. Reference number of the C/O form AHK

The C/O issuing authority or organization issues a unique reference number for each C/O form AHK.