Electronic Certificate of Origin (CO): Businesses should prepare thoroughly to optimize export opportunities.

The Ministry of Industry and Trade stated that the implementation of electronic Certificates of Origin (C/O) instead of the traditional paper method, along with the mechanism of self-certification of origin by traders, is becoming a focus in administrative procedure reform in the export sector in Viet Nam.

Therefore, coordination between the Ministry of Industry and Trade , local Departments of Industry and Trade, and the business community contributes to optimizing processes, ensuring compliance with international commitments, and enhancing the competitiveness of Vietnamese goods in the global market.

However, the application of electronic Certificates of Origin (C/O) still depends on the approval of the customs authorities of the importing country, because the certificate of origin is the basis for determining whether goods are eligible for preferential tariffs under free trade agreements.

Currently, most Certificates of Origin (C/O) issued by the Ministry of Industry and Trade and other competent authorities are processed electronically. However, some C/O forms, as stipulated by agreements and treaties with partners, still require a paper copy of the output product.

According to the Import-Export Department (Ministry of Industry and Trade), Viet Nam has fully implemented electronic Certificates of Origin (C/O) within three frameworks: ASEAN - 10 member countries; ASEAN - South Korea (AK); and Viet Nam - South Korea (VK). Within these frameworks, C/O data is transmitted directly through the National Single Window to Vietnamese customs and the customs of the importing country, creating a completely digitized processing environment and eliminating the need for paper C/Os.

Conversely, with Certificates of Origin (C/O) such as EUR.1 (EVFTA), EUR.1 UK/HUKA (UKVFTA), and EAV (Agreement with the Eurasian Economic Union - EAEU), even though the issuance process is electronic, the original must still be printed on paper and sent to the importer for customs clearance. The transition to a fully electronic C/O is only possible when the importing country officially approves it.

In reality, while Viet Nam is gradually moving towards a fully electronic Certificate of Origin (C/O), businesses still need to strictly comply with the requirements of each export market, especially for agreements that still maintain paper C/Os. For electronic C/O forms, businesses and management agencies can look up and verify information through integrated QR codes. Scanning the QR code allows full access to C/O data, contributing to increased transparency, reliability, and convenience in the customs clearance process.

According to the 2025 Law on Government Organization, Articles 8 and 9 stipulate that the Minister of Industry and Trade may only delegate or decentralize authority to subordinate state agencies. Therefore, the issuance of Certificates of Origin (C/O) in accordance with the law must be transferred to a state agency, specifically the Ministry of Industry and Trade.

Following the promulgation of the Law on Organization of Local Government 2025 and the effective date of Decree 146 on decentralization and delegation of authority, the delegation of authority to issue Certificates of Origin (C/O) to localities has become clearer. Currently, according to Decree 146 and Circular 40, a portion of the C/O issuance is delegated to the People's Committees of provinces and cities. These People's Committees then assign the task to their subordinate units.

Regarding administrative procedure reforms, businesses can request Certificates of Origin (C/O) from other localities, not necessarily from their registered headquarters or production sites. For example, Hanoi is willing to accept C/O applications from other provinces. This mechanism facilitates businesses, as many production facilities are located in other localities, while trading companies or import-export businesses are headquartered in Hanoi.

For example, a company based in Hanoi may choose to export goods through customs in Quang Ninh, Lang Son, Cat Lai port, or Hai Phong port, depending on convenience. The business can select the appropriate C/O issuing authority. However, it's important to note that this doesn't mean the same shipment can be issued a C/O in Hanoi while another shipment requires one in Hai Phong. Once a business has chosen a C/O issuing authority, the entire subsequent process must be conducted through that authority, including contacting the electronic C/O system and obtaining access credentials. The issuing authority cannot be changed arbitrarily for each shipment.

Not all international commitments that Viet Nam participates in allow businesses to self-certify the origin of goods. Within ASEAN, traders wishing to self-certify must obtain written approval from the Department of Industry and Trade or the competent C/O issuing authority. This is a mandatory step to ensure that businesses understand and comply with the rules of origin.

In other markets, such as the EU or the US, the self-certification mechanism for origin has its own principles. For example, in the EU, businesses do not need written approval from the Department of Industry and Trade and are allowed to self-certify the origin of shipments under 6,000 EUR. However, when inspected by customs authorities, businesses must still prove the legality of the origin. Failure to prove this will result in penalties. In practice, the amount of tax recovered and penalties can be high, many times the value of the shipment; therefore, businesses need to be cautious when applying the self-certification mechanism for origin.

"A Certificate of Origin (C/O) is essentially the tax value that a foreign enterprise is entitled to. Holding a C/O means we are holding a tool that helps our importing partners enjoy preferential tariffs," a representative from the Import-Export Department (Ministry of Industry and Trade) informed.

During contract negotiations, many businesses may sell goods at higher prices, along with a commitment to provide Certificates of Origin (C/O) so that partners can benefit from preferential tax rates, which can be as high as 18%. As a result, even with higher selling prices, Vietnamese goods remain highly competitive in foreign markets.

Furthermore, businesses from countries without FTAs ​​with importing markets may have to significantly reduce prices but still cannot access these preferential tax rates. In fact, for some goods, the preferential tax rate may not only be 18% but could reach 40%. Therefore, Certificates of Origin (C/O) and the self-certification mechanism for goods' origin should be viewed as a genuine economic value. Businesses needing to properly understand and adequately prepare their production plans to meet the rules of origin will help their goods qualify for preferential tariffs. This will allow businesses to effectively utilize the free trade agreements that Viet Nam participates in, enhance their competitiveness, and expand their export markets.

The implementation of electronic Certificates of Origin (C/O) and the self-certification mechanism is a crucial step in reforming administrative procedures and enhancing export capacity. Therefore, businesses need to thoroughly understand the different types of C/Os and their applicable frameworks; clearly understand the C/O issuance process, self-certification of origin, and legal risks; closely coordinate with the Ministry of Industry and Trade, the Department of Industry and Trade, and relevant agencies; and prepare dossiers, data, and production plans that comply with the rules of origin.

Effective coordination between government agencies and businesses will help Viet Nam move towards a digitized export environment, enhance transparency, reduce costs and time, and ensure the rights of businesses in the process of international integration.

Source: Tin Tuc News