Importers, exporters benefit from customs priority

The AEO mechanism has helped Sumidenso Vietnam Co., Ltd. save considerable time for and costs of processing customs procedures

Vietnam piloted the AEO program for enterprises having import and export activities in 2011.

The program was officially implemented in 2014 through the inclusion of its regulations in the 2014 Customs Law.

Sumidenso Vietnam Co., Ltd. in Dai An industrial park, Hai Duong province, is one of the first companies in Vietnam to be recognized as an AEO in July 2011.

Sakamoto Takuya, head of the enterprise’s production management department, said current AEO regulations offer a number of common benefits, such as exemption from inspection of documents and goods during customs clearance, clearance with incomplete declarations, deadlines for submission of customs dossiers, handling of tax payment...

“Without the AEO mechanism, our company will have to make a declaration for every delivery,” said Sakamoto Takuya.

“However, as an AEO, our company can deliver goods many times with only one declaration in a certain time according to the contract or order.

“The progress of customs clearance is thus accelerated, which is very efficient and convenient for our company.”

Sharing the same view, the head of the import-export department of Brother Industries (Vietnam) Co., Ltd. in Phuc Dien industrial park said that the priority mechanism is one of feasible measures to cut costs and enhance the efficiency of supply chains, especially for medium- and large-sized enterprises in the context of post-Covid-19 recovery as well as adaptation to current global economic fluctuations.

Brother Industries (Vietnam) Co., Ltd. is also one of the first enterprises in Vietnam to be certified as an AEO in July 2011.

The third company in Hai Duong to have enjoyed the AEO mechanism by July 2023 is Regent Garment Factory Ltd.

AEOs should continue to grow and comply with the law since their satisfaction of conditions is annually assessed by customs authorities (illustrative image)

The three enterprises are frequently among five businesses processing customs procedures at the Hai Duong Customs Branch with the largest import-export turnover in the province.

They earned more than 952 million USD in export turnover in the first half of 2023 alone, making up over 21% of the province’s export turnover.

The existing favorable conditions of the AEO mechanism have been helping to simplify processes and save time to carry out customs procedures, contributing to helping businesses save costs, improve the efficiency of capital management, and have more room to promote import and export, according to Deputy Director of the Hai Duong Customs Branch Dinh Xuan Vinh.

Once being AEOs, businesses are entitled to join the AEO community, including leading enterprises and economic organizations in Vietnam with great influence on economic growth, Vinh said.

The AEO mechanism can be considered as a guarantee of the reliability, economic capacity, and legal compliance of enterprises in international trade.

This is one of competitive advantages helping businesses expand their markets and approach customers faster, especially after the Vietnam Customs’ signing of an agreement on mutual recognition of the AEO program with ASEAN member states in February 2023.

About 70 businesses in Vietnam have so far been recognized as AEOs, including the three in Hai Duong. Most of them are FDI enterprises with high import-export turnover.

“Businesses should be more proactive in reviewing, evaluation, and consultation of experts or customs authorities on the possibility of recognition. The sooner they approach, the more conditions they will have for growth," added Vinh.

HA KIEN