Exports by the method of exchanging border residents (small quota) will be tightened from the beginning of 2025, as a way to avoid the recurrence of congestion at the border gate, especially with China.
This content is stated in the draft decree amending and supplementing Decree 14/2018 on border trade activities which is being consulted by the Ministry of Industry and Trade.
According to this ministry, goods exported through border gates, including China, include official exports according to international practices and resident exchange (small quota). This showcase enjoys privileges, such as quarantine exemption, no contract, no bank payment, and tax exemption for goods under 8,000 yuan per person per day.
Accordingly, from January 1, 2025, goods exported by the method of exchanging border residents (small quota) will be gradually reduced the number of times and the amount of tax exempted. Goods exported through small quotas must meet quality standards and regulations on traceability. Only residents of the border area are allowed to export in the form of resident exchange and they must be present in person for exit procedures.
Then one year, from the beginning of 2026, official goods exported to China will go through procedures at international border gates, main border gates (bilateral border gates) and auxiliary border gates, openings to reach bilateral agreements on export. import and exchange of goods.
From 2027, temporarily suspending import and export of goods at border gates and openings without reaching bilateral agreements on cross-border goods exchange, purchase and sale. By 2028, border gates and openings can only carry out customs clearance procedures for goods that have been licensed and officially exported to China.
Tightening the export of small-quantity goods, according to the Ministry of Industry and Trade, aims to bring the daily exchange, purchase and sale of goods of border residents to the right nature. This brings exports to China in accordance with international practices, compliance with quality requirements, traceability to the origin of the host country, and avoids the recurrence of agricultural product congestion at the border gate as before.
Customs clearance of goods at road border gate No. II KIm Thanh (Lao Cai), February 2020. Image: Giang Huy
According to the Ministry of Industry and Trade, border trade has grown over the years but has not been vibrant and limited in scale.
Current regulations on goods transactions across land borders, especially exports, are quite easy. All traders are entitled to export across borders. Individuals without business registration but residing in border areas also have the right to export goods, except for prohibited goods. Traders make their own lists of goods to replace contracts, do not have to present purchase and sale contracts with customs authorities and flexible payment methods.
The ministry stated the fact that many Vietnamese agricultural products have not yet been licensed to be imported officially into China, so they go to this country through unofficial channels. Even some products are officially licensed for export but still switch to small quota for export to China. Meanwhile, Chinese businesses take advantage of this form to make a list of residents, then collect tax-free standards to import large shipments.
Since the beginning of 2022, China has applied food safety management orders with small-scale exports to the country. Therefore, goods exchanged between border residents will not have many opportunities to “go straight” as before.
