Car importers in the fast lane

Car import firms’ headaches have eased with a Ministry of Industry of Trade car import guiding document.

In light of Document 7860 dated August 24, 2011 less-than-nine seat imported cars going on ship prior to June 26, 2011 and reaching Vietnamese ports prior to July 24, 2011 would make import procedures based on former regulations and not those in Circular 20/2011/TT-BCT dated May 12, 2011 and effective from June 26, 2011.

The document is a ‘life-buoy’ for imported cars got stuck at ports due to Circular 20.

Reality shows that around 1,000 less-than-nine seat brand-new cars are at ports after reaching Vietnamese ports after June 26, the date Circular 20 came into force.

In light of Circular 20, after July 24, 2011 less-than-nine seat car importers must show the customs bodies a number of documents when making import procedures. These include authorisation of the genuine manufacturer, authorised agent contract approved by Vietnamese diplomatic missions in related countries and warranty and maintenance certificates issued by the Ministry of Transport.

Though Document 7860 helped firms finalise car import procedures, it upset firms as they had to bear significant port storage fees during time before Document 7860’s enactment.

“Enactment of Circular 20 came abruptly making firms having car import shipments reaching Vietnamese ports after June 26 to suffer. When competent state agencies are yet to reach a consensus about ways to deal with imported cars which finalised procedures with foreign partners before May 12, 2011 [the enactment date of Circular 20] and reaching ports after June 26, we incurred big storage fees at ports as our cars could not come through customs checks,” said an import car firm owner.

The current one-month storage fee is $1,500 for a 40-feet container and is approximately $1,000 for 20-feet container at local ports. This means firms with imported cars reaching Vietnamese ports before July 24 incurred at least one month storage fees, irrespective of the growing pressures from their unpaid bank debts.

However, allowing imported cars reaching Vietnamese ports before July 24, 2011 to complete customs procedures was just part of the impediment imported firms face relative to enforcement of Circular 20.

The owner of an imported car firm was quoted as saying “We advanced money for the US partner to buy cars before May 12, then Circular 20 came into existence and our foreign partner delayed car delivery fearful these cars could not finalise import procedures at Vietnamese ports. We had to bear high port storage fees in US ports. If things continue, we would lose the amount earlier paid to the foreign partner whereas it was not our fault.”

“We wait a reasonable settlement from state management bodies for firms like us not incurring heavy losses,” he said.

Source: VIR

Tags: Vietnam automotive, Vietnam automotive industry, Vietnam autos market, Vietnam car imports