Self-certification mechanism looms to put in place to facilitate local exporters to EU

As part of becoming more integrated into the global economy, Vietnam is participating in many Free Trade Agreements (FTAs) in which the first requirement is to have self-certification mechanism for the origin of goods.

According to the Agency of Foreign Trade under Ministry of Industry and Trade, following this requirement, the responsibility for verifying the source of products will be shifted from authorities to enterprises or exporters.

In particular, enterprises will have to perform all the steps themselves, meeting the requirements of products origins and be accountable for their accuracy.

Self-certification provides businesses with many advantages including reducing time of applying for traditional certificate of origin, C/O (a document used in international trade which determines the country of origin of goods), decreasing transaction costs, proactively issuing commercial invoices and assisting businesses to grasp the requirement of the source in FTA, as mentioned by trade experts.

At the same time, it reduces the risk of licensing authorities and minimizes the burden on customs.

It will be quite a rush to force enterprises to self-certify right away as there are currently 2,700 Vietnamese enterprises exporting to the EU enjoying the benefits of GSP.

The only difference is that instead of the authorities, the enterprise will issue its own C/O by including the line “ this product is qualified for GSP” in their document and invoice.

“Having enterprises become self-certifying exporters show the trust of Government agencies in businesses, in compliance with Vietnam commitment in the FTA,” said Tran Thanh Hai, Deputy Director General of the Agency of Foreign Trade (Ministry of Industry and Trade).

In order to reduce the burden on enterprises, Vietnamese businesses will have around six months of transition time. During this time, if enterprises are unable to self-verify the origin of their products, they can apply for C/O from the authorities as usual.

The Ministry of Industry and Trade will still train, instruct and remain a place for business registry. In case any issue arises from the trading process, the agency will have information to collaborate with the EU to determine the source of goods and enterprises.

When businesses self-certify the origin of their products, they are acting on the Government's behalf. 

Experts said that if businesses do not comprehend the mechanism and the necessary requirements that can result in false certification, the outcome will not only affect to the businesses but also to the whole nation.