Effectively utilizing Certificates of Origin (C/O) opens the "highway" to access the EU market.

The utilization rate of Certificates of Origin (C/O) has increased significantly.

As one of the key export items to the EU, coffee exporting businesses are currently striving to improve product quality to conquer the market. Mr. Phan Minh Thong, Chairman of the Board of Directors of Phuc Sinh Group, shared that the EU is Phuc Sinh's largest market, accounting for 45-55% of the company's total revenue. To take advantage of the benefits from the EVFTA, many Vietnamese businesses, including Phuc Sinh, have increased investment in processing roasted and ground coffee, instant coffee, and 3-in-1 coffee for export to the EU market.

The EU is one of the largest markets for Vietnamese coffee (Photo: Phuc Sinh Group)

Coffee is one of the commodities that has effectively utilized the EVFTA Agreement to increase export turnover. According to the Import-Export Department of the Ministry of Industry and Trade , the EVFTA Agreement, which came into effect for Vietnam on August 1, 2020, has helped Vietnamese goods take advantage of opportunities to access and penetrate the EU market, enhancing competitiveness through tariff preferences and preferential tax rates from the Agreement.

According to the latest statistics from the Import-Export Department, in 2023, the utilization rate of EUR.1 Certificates of Origin (C/O) was 35.2% of export turnover, equivalent to export turnover using C/O of US$15.4 billion, an increase of 26.1% compared to 2022.

Some product groups have very good utilization rates of EUR.1 preferential Certificates of Origin (C/O), such as seafood (89.2%), fruits and vegetables (88.3%), and rice (fully utilizing the 80,000-ton EU rice quota allocated to Vietnam annually). Footwear – one of Vietnam's key export items to the EU market with an export value of 4.8 billion USD – has a nearly 100% rate of EUR.1 preferential C/O issuance.

In the first quarter of 2024, the utilization rate of EUR.1 certificates of origin was 34.3%. This result shows that the EVFTA has initially demonstrated the effectiveness of a substantive and highly anticipated agreement, but it still has much room for further development.

To take advantage of the opportunities offered by the EVFTA Agreement, Vietnam has recently made efforts to negotiate with the EU to agree on a common understanding of specific product criteria in a way that aligns with modern production practices, creating favorable conditions for export businesses (such as for textiles and garments). Regarding rice quotas, the Ministry of Industry and Trade is coordinating with the Ministry of Agriculture and Rural Development to negotiate revisions to the list of rice varieties to better reflect Vietnam's current strengths in rice varieties (such as ST 24 and ST 25), replacing the DT8 and OM5451 varieties.

Regarding the implementation of rules of origin and the dissemination of information to support businesses in effectively utilizing the EVFTA Agreement in the field of rules of origin, the Import-Export Department has recently coordinated with relevant functional units such as the Department of European and American Markets, the Department of Multilateral Trade Policy, the Department of Trade Remedies, and the Department of Legal Affairs to implement specific solutions.

The Minister of Industry and Trade issued Circular No. 11/2020/TT-BCT dated June 15, 2020, stipulating the Rules of Origin for goods under the Free Trade Agreement between Vietnam and the European Union, as amended and supplemented by Circular No. 41/2022/TT-BCT dated December 30, 2022, which internalizes the commitments on origin of goods in the EVFTA.

At the same time, we will closely coordinate with Vietnamese trade offices in the EU to facilitate Vietnamese exports to the EU market, ensuring they meet the commitments, regulations, and origin criteria in the EVFTA.

The Ministry of Industry and Trade also promptly addresses difficulties and obstacles faced by Vietnamese businesses and their importing partners in the field of origin of goods in particular and import and export in general. It regularly organizes conferences and seminars with localities, export industry associations, and businesses to inform Vietnamese export businesses about complying with regulations on origin of goods, taking advantage of tariff preferences, and warning about fraudulent practices related to the origin of goods.

What solutions can maximize the benefits of the EVFTA?

The EU is a market region that applies very high standards to imported products, but at the same time, it is also a market region with significant growth potential for Vietnamese export products. In the coming period, to maximize the benefits of the EVFTA Agreement and fully exploit the commitments related to rules of origin, while simultaneously providing early warning of potential violations and fraudulent origin claims, the Import-Export Department will coordinate with functional units within the Ministry of Industry and Trade and Vietnamese trade offices in the EU to implement a number of solutions.

Specifically, we will continue to coordinate and review with the EU the commitments in the Agreement and update and adjust relevant legal documents to incorporate the commitments in the Agreement.

In addition, closely monitor the market to promptly provide information to regulatory agencies when there are signs of irregularities regarding fraudulent origin of goods, preventing domestic production and export industries from being implicated and affected by trade defense measures in importing markets.

At the same time, closely monitor the business operations of enterprises as well as trade relations between Vietnam and its partners in order to consider negotiation contents related to the origin of goods for Vietnamese export products.

In addition, negotiations on the implementation of the rules of origin chapter with the EU should continue to create favorable conditions for Vietnamese businesses to negotiate (such as provisions on cumulation of origin, flexible quotas applicable to textile products, etc.).

The Import-Export Department emphasized that, in order to boost exports to the EU, trade offices need to continue supporting businesses with market information, consumer demand, regulations, standards, and rules of origin for each specific market. This will enable exporters to proactively develop plans and strategies to access the market and promote exports of goods that benefit from preferential tariffs to the EU.

In the coming period, the Import-Export Department will continue to closely coordinate with relevant agencies within the Ministry and trade offices in the EU to promptly resolve issues related to preferential tariff treatment, processing times for preferential treatment, and combating origin fraud. At the same time, it will strengthen the dissemination of new and updated regulations on rules of origin that exported goods need to meet to enjoy preferential tariffs, contributing to increasing the utilization rate of preferential Certificates of Origin (C/O) under the EVFTA Agreement.

Source: https://congthuong.vn/tan-dung-hieu-qua-co-khoi-mo-cao-toc-dan-vao-thi-truong-eu-333322.html