Quang Ninh: Conference on Converting Specific Product Rules within the AKFTA Framework

View of the Conference on Conversion of Specific Product Rules within the framework of AKFTA in Quang Ninh :. (Photo: Duc Hieu/VNA)

On the morning of March 25, in Ha Long city (Quang Ninh province), the Import-Export Department ( Ministry of Industry and Trade ) and the ASEAN Secretariat jointly organized a conference on the Conversion of Specific Product Rules within the framework of the ASEAN-Korea Free Trade Agreement (AKFTA).

The conference was attended by representatives from Korea and 10 ASEAN countries, and some delegates from member countries participated online. The conference lasted for 3 days.

At the conference, delegates from the countries will review and aim to convert nearly 7,000 tariff lines of the list of specific product rules (PSR) in AKFTA from commodity classification code (HS) 2107 to HS 2022; discuss the progress and mechanism for implementing rules of origin under the new HS.

According to the regulations of the World Customs Organization, the HS code of the harmonized system of description and coding of goods is updated regularly every 5 years to ensure conformity with the types and needs of international trade.

This update also requires the criteria for determining the origin of goods in Free Trade Agreements, including the ASEAN-Korea Free Trade Agreement, to be converted.

Converting PSR in the AKFTA Agreement on time will ensure transparency, helping import-export enterprises benefit from the Free Trade Agreement.

Mr. Nguyen Anh Son, Director of the Import-Export Department (Ministry of Industry and Trade), speaking at the Conference. (Photo: Duc Hieu/ VNA)

Speaking at the conference, Mr. Nguyen Anh Son, Director of the Import-Export Department (Ministry of Industry and Trade) emphasized that converting PSR on time will ensure estimates and transparency for businesses.

Delaying the PSR transition will result in increased costs and loss of benefits from the ASEAN Free Trade Agreement. The line-by-line review of 7,000 tariff lines will require high concentration and strong consensus from ASEAN countries and Korea.

Director Nguyen Anh Son added that with the success of the similar conference in 2018 in Vietnam, the Korean partner and ASEAN member countries received many positive responses about the role of the host country Vietnam in organizing the conference and within the framework of the ASEAN-Korea Trade in Goods Agreement.

At the conference, Ms. Sasikanya PONIEN, Co-Chair of the Subcommittee on Rules of Origin of the ASEAN-Korea Agreement, shared that this is an important conference for ASEAN countries and Korea to discuss and propose a mechanism to implement rules of origin under the new HS.

Ms. Sasikanya PONIEN, Co-Chair of the Subcommittee on Rules of Origin of the ASEAN-Korea Agreement, speaks at the Conference on Transformation of Product-Specific Rules within the framework of AKFTA. (Photo: Duc Hieu/VNA)

Ensuring that goods have clear origins will help facilitate import and export, and enjoy tax incentives. We appreciate Vietnam's organization of this conference, the success of which will connect ASEAN countries and Korea, and at the same time bring competitive price opportunities for export enterprises.

According to Director of the Import-Export Department Nguyen Anh Son, ASEAN and Korea signed the Framework Agreement on Comprehensive Economic Cooperation in 2005 and the Agreement on Trade in Goods which took effect from June 2007.

To ensure that goods of the right origin enjoy preferential tariffs, AKFTA stipulates how to determine origin. In order to implement the AKFTA Agreement, the ASEAN-Korea Economic Cooperation Subcommittee held a Conference on Origin of Goods to convert the list of commodity rules according to the Harmonized System of the World Customs Organization (WCO). This will facilitate importers to use certificates of origin to enjoy special preferential tariffs under AKFTA.

Delegates take souvenir photos. (Photo: Duc Hieu/VNA)

Recently, Korea has continuously been one of the leading markets for importing goods from Vietnam with the highest rate of FTA preferential use.

In 2023, the Korean market will have a preferential certificate of origin usage rate of 52.1%, with the export turnover of goods with certificates of origin to Korea reaching 12.2 billion USD.

Enterprises have a certain awareness of using preferential certificates of origin as an effective tool in business planning when exporting goods to Vietnamese markets with commitments to enjoy tariff incentives.

The group of Vietnamese goods exported to Korea with the best rate of FTA preferential use includes seafood (96.32%). Agricultural products such as vegetables, coffee and pepper all have very high rates of preferential certificate of origin use, reaching 91.18%, 94.54% and 100% respectively; wood and wood products (73.76%); footwear and textiles have a rate of nearly 100%.

In the ASEAN-Korea Trade in Goods Agreement, Vietnam committed to eliminating import tariffs on about 86% of total tariff lines by 2018; reducing tariffs on the remaining 14% of total tariff lines to 5% by the end of the roadmap (2021) and partially cutting tariffs in 2021 or maintaining preferential import tariff rates (MFN).

In the context that Vietnamese goods have many opportunities to enjoy tariff preferences in FTA markets, rules of origin are a tool to neutralize FTA advantages if goods do not meet the requirements and a tool to distinguish the advantages of FTA countries from those of countries outside the FTA./.

According to vietnamplus.vn

Source: https://www.vietnamplus.vn/quang-ninh-hoi-nghi-chuyen-doi-quy-tac-cu-the-mat-hang-trong-khuon-kho-akfta-post936403.vnp

Source