What Is On Spot Export? Detailed Procedure Documents and Processes

1. What is on spot export?

On spot export is one of the no longer unfamiliar terms in the import-export business. Although it has only appeared in recent years, on-site export is very popular. So what is this form of export?

Pursuant to Clause 1, Article 86 of Circular 38/2015/TT-BTC, on-site export is the case of goods produced to serve the export needs of a foreign enterprise. However, these goods will be delivered in Vietnam to a unit designated by the foreign enterprise. Export enterprises include domestic enterprises and foreign-invested enterprises.

2. Benefits of on spot export services

On-site exporting is becoming increasingly popular with many businesses, especially foreign businesses. Because perhaps this form of export brings many benefits:

• Saves many types of costs for businesses.
• Save shipping and delivery time while still ensuring the goods are safe. This helps improve work productivity compared to traditional export methods.
• Businesses enjoy many tax incentives.

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3. Types of goods allowed to be exported on the spot

According to Clause 1 and Article 86 of Circular 38/2015/TT-BTC, permitted on spot export goods include:

• Goods are rented or borrowed machinery and equipment, surplus raw materials, scrap, or defective products under processing contracts implemented in accordance with the provisions of Clause 3 and Article 32 of Decree No. 187/2013/ND-CP.
• Goods traded between export processing enterprises and domestic enterprises or with enterprises in non-tariff areas.
• Goods purchased and sold between Vietnamese enterprises and foreign individuals or organizations that do not have a presence in Vietnam but are only designated by the foreign enterprise to receive goods from other enterprises in Vietnam.

4. Types of documents required for on-spot export customs procedures

According to Clause 3, Article 86 of Circular 38/2015/TT-BTC, customs documents for imported and exported goods on the spot are implemented in Article 16 of Circular 38/2015/TT-BTC (amended). Change Clause 58, Article 1, Circular 39/2018/TT-BTC), as follows:

• Export goods declaration.
• Export license
• Commercial invoice or documents of equivalent value in case the buyer pays directly to the seller.
• Notice of exemption from inspection or notice of test results for transfer to industry, other documents according to legal regulations, specialized inspection (also known as a Certificate of Specialized Inspection).
• Certificate proving that the individual or organization is eligible to export goods according to the provisions of the law.
• Trust contract.

5. On spot import and export customs procedures

Any form of export needs to follow customs procedures to ensure goods are cleared smoothly. So below is the on spot import and export customs clearance process.

5.1. Location for on-spot import and export customs procedures

Pursuant to Clause 2, Article 86 of Circular 38/2015/TT-BTC, customs declarants actually select and perform on-site import and export procedures at the nearest Customs Branch and in accordance with the regulations of each type.

5.2. Time limit for completing procedures for on-spot exported goods

Based on Clause 4, Article 86 of Circular 38/2015/TT-BTC (amending Clause 58, Article 1 of Circular 39/2018/TT-BTC) stipulates that the time limit for customs procedures is no more than 15 days from the date of customs clearance. goods according to regulations. Persons carrying out on-site imports must complete customs procedures.

5.3. Responsibilities of the parties when conducting procedures

The responsibilities of the parties carrying out export procedures are as follows:

5.4. Process of carrying out export procedures on the spot

The process of carrying out on spot export procedures is carried out in five steps, specifically as follows:

• Step 1: Enterprises and exporting organizations declare customs.

Based on the sales contract previously signed with a foreign enterprise that specifies delivery in Vietnam, the enterprise needs to fully declare the criteria for the enterprise on the declaration.

• Step 2: The importing enterprise completes on-site import procedures.

Individuals must declare to the Customs Branch to register for on-site import procedures appropriate to the type of import and export when they have received enough goods.

• Step 3: The Customs Department carries out import procedures. Enterprises continue to perfect procedures:
  • Submit declaration
  • Tax
  • Sealing the goods (if any)
  • Confirm that the procedure has been completed.
  • Assigned to businesses and kept records
  • Notify the local tax department to monitor corporate taxes.
• Step 4: Export enterprise

The exporting enterprise receives the completed documents and transfers them to the Customs Branch, where the export procedures are carried out for on-site export registration.

• Step 5: The Customs Department carries out export procedures.

The Customs Branch receives customs declarations and other documents in the on-site export registration dossier. Enterprises continue to complete the registration steps according to regulations appropriate to each type of import and export, taxes, and fees, if any.

Note:

• Customs declaration is carried out within 30 days from the date of delivery of goods.
• Customs authorities are only allowed to check documents related to the delivery of goods (not physically check the goods).
• For each delivery, the exporter and importer must have documents proving the delivery of goods and be responsible for storing them at the enterprise and presenting them when inspected by the customs authority.

6. VAT rate for on-spot exported goods

A value-added tax is a tax calculated based on the added value of goods and services arising during the production and consumption processes. According to the provisions of the 2008 Value Added Tax Law (amended and supplemented in 2013, 2014, and 2016), exported goods and services will apply a tax rate of 0%.

Cases where goods are not eligible for 0% tax:

• Gasoline sold for cars in business establishments in the non-tariff area is purchased domestically.
• Cars are sold to individuals or organizations in the non-tariff area.
• Services provided by business establishments in the non-tariff area include: transportation services to pick up and drop off workers; catering services, house rentals, halls, offices, hotels, warehouses, etc. (except for industrial catering services in non-tariff areas).
• The following services provided in Vietnam to individuals and organizations abroad do not apply to the 0% tax rate: Online payment services; services provided associated with the sale, distribution, and consumption of products and goods in Vietnam; Sports competitions, performing arts, culture, entertainment, conferences, hotels, travel, training, and advertising.

• Overseas reinsurance; transfer of intellectual property rights abroad; technology transfer, capital transfer, stock investment, credit granting abroad; postal and telecommunications services going abroad; derivative financial services.
• Exported goods are mineral resources that have not been processed into other products. Imported drugs, leaves, wine, and beer were then exported. Goods and services provided without business registration for non-tariff areas (except for cases prescribed by the Prime Minister).

7. Note when completing procedures to open import and export declarations on the spot

On spot exporting brings businesses many benefits. However, in order for the export process to go as smoothly as possible, businesses need to keep in mind a few things to avoid wasting time!

• In cases of on-site import and export of goods as designated by a foreign enterprise, the importer must synthesize and prepare a customs clearance declaration monthly according to Form 20/TKXNTC/GSQL, Appendix V, issued with Circular 38/2015. (TT-BTC). Then send this list to the direct tax authority.
• Declare goods information to open on-site import and export customs declarations to ensure honesty and accuracy over time in the signed sales contract.
• Customs declarants are allowed to open import and export customs declarations on-site only at the most convenient Customs Branch.

• In cases where businesses are in special categories, are given priority, or are priority business partners, businesses must still comply with customs laws. Or partner with a business that also complies with customs laws and correctly implements on-site import and export laws multiple times in a certain period of time (same contract, same buyer and seller). If done correctly and sufficiently, businesses are allowed to deliver goods first and complete customs declaration procedures later.
• In case the export or import declaration is opened at a Customs branch where the export declaration is red, if the actual goods have been inspected and the customs clearance procedures have been completed correctly, the import declaration can be exempted from physical goods inspection according to regulations.

On-site export is no longer a new form of export and brings many benefits to businesses. However, businesses need to understand clearly so that the export process goes smoothly. And hopefully the information that Dolphin Sea Air just shared is useful for the knowledge you are interested in.

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