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Car imports: MOF suggests concessions, MOIT insists on strict rules
2011-0715
While the Ministries of Finance, and Industry and Trade are still discussing about how to deal with imported cars, no consignment of imports has got customs clearance.
The Ministry of Finance (MOF) has proposed the Ministry of Industry and Trade to “give a way out” to car importers, who signed the import contracts prior to May 12, the day the Circular 20 stipulating the new procedures for car imports was issued. However, the Ministry of Industry and Trade has said it still needs thorough consideration.
MOF suggests concessions, MOIT insists on strict rules
The issuance of the Circular 20 has been facing the strong opposition from domestic car dealers, who say the new regulation requires them to show the documents they will never have. MOIT has also been warned that a lot of car dealers will die because of the strict rules stipulated in the circular.
“We applaud the issuance of Circular 20. However, every new policy needs some time to be brought into life, while enterprises need a transitional period to prepare for the new policy,” Deputy Minister of Finance Do Hoang Anh Tuan told VietNamNet’s Vietnam Economic Forum.
Tuan said that MOF has sent a dispatch to MOIT, expressing MOF’s official viewpoint on the issue and saying that as for the car import contracts signed prior to May 12, where the importers have made payment, MOIT should allow the importers to get customs clearance with previously applied procedures. However, MOIT has not made reply so far.
Deputy Minister of Industry and Trade Nguyen Thanh Bien has admitted that in the immediate time, MOIT has not cleared any import consignment.
“MOIT is still checking the documents, vouchers relating to the import contracts. We have to cooperate with relevant agencies, banks, customs agencies to deal with every specific case. Everything is still under consideration,” Bien said, replying to the criticism that MOIT deliberately does not give replies to businesses’ proposal.
Door to be closed to car imports?
While waiting for MOIT to make final decision, a lot of troubles have arisen. Representative of Bao Tin Son Tung Automobile Company said that the company has 14 contracts on importing luxury cars for which the company had made payment prior to May 12. After the Circular 20 was issued which stipulates stricter requirements, the company tried to urge the exporters to speed up the deliveries. However, the consignments could not arrive prior to June 26, the day when the new circular took effects.
“We have been put into dilemma. We cannot cancel the orders as we have remitted money for payment. Meanwhile, we do not have cars to deliver to our clients, and we are facing the risk of paying fine for breaking contracts,” the representative said.
“The clients, who order luxury cars, always have to pay money in advance. Of the 14 orders, six were signed in the time from August to November of 2011, while money was also remitted during that time,” he added. “The total fine may be up to several millions of dollars”.
When asked about the letter of attorney of manufacturers, he said that his company trades cars with five different brands, including Rolls Royce Phantom, Benley, Renault. “No one would grant letter of attorney to a company which distributes cars of five different manufacturers,” he said.
De Nhat Auto Company has complained that it cannot get the automatic import license for the four Kia Mornings. The cars, manufactured in South Korea, have been used for less than six months and the mileage of less than 10,000 kilometers, therefore, they cannot be considered as “used cars”.
“MOIT has told us that the cars must be imported as brand new cars. However, it is reasonable. The foreign automobile manufacturers will not give us the necessary document for the used cars. They now only have the maintenance duty,” the representative of the company said.
The Ministry of Finance (MOF) has proposed the Ministry of Industry and Trade to “give a way out” to car importers, who signed the import contracts prior to May 12, the day the Circular 20 stipulating the new procedures for car imports was issued. However, the Ministry of Industry and Trade has said it still needs thorough consideration.
MOF suggests concessions, MOIT insists on strict rules
The issuance of the Circular 20 has been facing the strong opposition from domestic car dealers, who say the new regulation requires them to show the documents they will never have. MOIT has also been warned that a lot of car dealers will die because of the strict rules stipulated in the circular.
“We applaud the issuance of Circular 20. However, every new policy needs some time to be brought into life, while enterprises need a transitional period to prepare for the new policy,” Deputy Minister of Finance Do Hoang Anh Tuan told VietNamNet’s Vietnam Economic Forum.
Tuan said that MOF has sent a dispatch to MOIT, expressing MOF’s official viewpoint on the issue and saying that as for the car import contracts signed prior to May 12, where the importers have made payment, MOIT should allow the importers to get customs clearance with previously applied procedures. However, MOIT has not made reply so far.
Deputy Minister of Industry and Trade Nguyen Thanh Bien has admitted that in the immediate time, MOIT has not cleared any import consignment.
“MOIT is still checking the documents, vouchers relating to the import contracts. We have to cooperate with relevant agencies, banks, customs agencies to deal with every specific case. Everything is still under consideration,” Bien said, replying to the criticism that MOIT deliberately does not give replies to businesses’ proposal.
Door to be closed to car imports?
While waiting for MOIT to make final decision, a lot of troubles have arisen. Representative of Bao Tin Son Tung Automobile Company said that the company has 14 contracts on importing luxury cars for which the company had made payment prior to May 12. After the Circular 20 was issued which stipulates stricter requirements, the company tried to urge the exporters to speed up the deliveries. However, the consignments could not arrive prior to June 26, the day when the new circular took effects.
“We have been put into dilemma. We cannot cancel the orders as we have remitted money for payment. Meanwhile, we do not have cars to deliver to our clients, and we are facing the risk of paying fine for breaking contracts,” the representative said.
“The clients, who order luxury cars, always have to pay money in advance. Of the 14 orders, six were signed in the time from August to November of 2011, while money was also remitted during that time,” he added. “The total fine may be up to several millions of dollars”.
When asked about the letter of attorney of manufacturers, he said that his company trades cars with five different brands, including Rolls Royce Phantom, Benley, Renault. “No one would grant letter of attorney to a company which distributes cars of five different manufacturers,” he said.
De Nhat Auto Company has complained that it cannot get the automatic import license for the four Kia Mornings. The cars, manufactured in South Korea, have been used for less than six months and the mileage of less than 10,000 kilometers, therefore, they cannot be considered as “used cars”.
“MOIT has told us that the cars must be imported as brand new cars. However, it is reasonable. The foreign automobile manufacturers will not give us the necessary document for the used cars. They now only have the maintenance duty,” the representative of the company said.
Source: Vietnamnet
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