PROCEDURES FOR EXPANSION OF BONDED WAREHOUSE

PROCEDURES FOR EXPANSION OF BONDED WAREHOUSE

Economic integration and expansion at home and abroad, the trade of goods is also so bustling. Every day throughout the country, there are activities of storing and transporting goods of businesses from their bonded warehouses. Thereafter, a part of the business needs to expand its bonded warehouses. Hence, how are the procedures for expansion of bonded warehouses implemented? HTC Vietnam Law Firm will accompany you to answer your questions in the following article.

I. Legal basis

- Law on Customs in 2014;

- Decree No. 68/2016/ND-CP dated July 01, 2016 of the Government regulations on conditions for duty-free business, warehouses and sites for customs clearance, customs inspection and supervision;

- Decree No. 67/2020/ND-CP dated June 15, 2021 of the Government amending Government’s Decree No. 68/2016 / ND-CP dated July 1, 2016 on requirements for trading of duty-free goods, storage facilities, locations for customs clearance procedures, commodity gathering, customs inspection and supervision.

II. Scope of consultation

1. The definition of bonded warehouse

Bonded warehouses under Clause 10, Article 4 of the 2014 Customs Law are understood as a depot for storing goods for which customs formalities have been completed and which are stored pending their export; goods sent from abroad and stored pending their re-export or their import into Vietnam.

In the business and provision of goods delivery services, a bonded warehouse is defined as a warehouse or storing yard established within territory of Vietnam, and separated from surrounding areas for temporary storage, preservation or provision of a number of services for goods brought from abroad or from the country into the warehouse under a bonded warehouse hire contract signed between the bonded warehouse owner and the goods owner.

Bonded warehouses are allowed to be established in the following areas: provinces and municipal cities, which are the hubs for goods exchange between Vietnam and foreign countries; industrial parks, hi-tech parks, export processing zones and other special economic zones (called industrial parks for short).

Bonded warehouses, goods and means of transportation in and out, storing or preserving in bonded warehouses must go through customs formalities subject to the inspection and supervision by customs authorities and to the adjustment of the Law on Customs and relevant legal documents.

2. Procedures for expanding bonded warehouses

Article 10 of Decree 68/2016 / ND-CP stipulates the conditions for recognition of bonded warehouses with the following criteria:

- Regarding the area to apply for recognition of the bonded warehouse: It must be located within the area as prescribed in the Law on Customs.

- Bonded warehouses are separated from surrounding areas by a fence network meeting requirements for regular supervision of customs agencies except warehouses in checkpoint areas, harbors already fenced off from surrounding areas.

- Regarding the area of bonded warehouses: Bonded warehouses located in seaports, Bonded warehouses located in seaports, inland waterway ports, inland container depots, international airports or international railway stations must have an area of at least 1, 000 m2; specialized bonded warehouses must have an area of at least 1, 000 m2 or a volume of at least 1, 000 m3; bonded warehouses located in industrial parks must have an area of at least 4, 000 m2, of which the area of the warehouse must be at least 1, 000 m2; bonded warehouses in other cases must have an area of at least 5, 000 m2, of which the area of the warehouse must be at least 1,000 m2.

- A bonded warehouse shall have software that is capable of managing imports, exports, inventories directly connected to customs agencies.

- A bonded warehouse shall have a camera system that is directly connected to customs agencies.

The procedures for expansion of bonded warehouses

The provisions on the expansion of bonded warehouses are specified in Clause 1, Article 13 of Decree 68/2016 / ND-CP. Accordingly, if there is a need to expand a bonded warehouse and meet the conditions specified in Article 10 of the Decree, the enterprise shall compile and send a dossier to the General Department of Customs. The application includes:

- A written request to expand, reduce, move the customs clearance site, transfer ownership or suspends activities;

- Copy of diagrams of expansion, contraction, relocation and transfer-of-ownership areas;

- Copy of the contract for transfer of ownership;

The procedures for recognition of bonded warehouses are specified in Article 12 of Decree 68/2016 / ND-CP. In particular:

- The enterprise should submit the application for recognition of the bonded warehouse in person or via the customs agencies’ electronic data processing system to the General Department of Customs.

- Within 10 working days since receipt of the application, the General Department of Customs shall complete inspection of the application, warehouses, storage yards.

- Within five working days since completion of inspection, the director of the General Department of Customs shall issue the decision on recognition of the bonded warehouse or give notification to the enterprise if the application fails to meet the requirements.

- In case of insufficient valid dossiers, the General Department of Customs shall issue a written notice and request the enterprise to supplement the dossier, within 05 working days from the date of receipt of the enterprise's dossier.

Above are our opinions on the procedures for expanding bonded warehouses. HTC Vietnam Law Firm is pleased to accompany customers in solving all legal issues. Please contact us to use the consulting service in the best way.

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For more details, please contact:

HTC Vietnam Law Firm

Address: 15th Floor, Multipurpose Building, 169 Nguyen Ngoc Vu, Trung Hoa Ward, Cau Giay District, Hanoi.

Tel: 0989.386.729; Email: [email protected]

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(Writer: Tran Thi My Anh)

Translator: Pham Nguyen Nhat Linh