Free trade in goods will be based, as is the case with other similar agreements, on the preferential origin of goods. Specific rules concerning the preferential origin for trade with Vietnam are included in the Agreement. When exporting to Vietnam, EU exporters can certify the preferential origin with a declaration of a registered exporter, the so-called REX. Regarding consignments worth up to EUR 6,000, a certificate of origin may be issued by any exporter. For the purpose of importing goods from Vietnam, the preferential origin of the goods will be proven by the movement certificate EUR.1 for the time being (in the future, the method of proving the origin of goods may change). For consignments worth up to EUR 6,000, it is sufficient for a certificate of origin to be issued by the exporter.

Documents certifying the preferential origin for trade with Vietnam may only be issued after 1 August 2020. For consignments that were already ‘on the way’ before 1 August 2020 and released into free circulation before this date, the preferential origin may also be applied retroactively.

The use of preferential tariffs usually brings significant savings on customs duties. Naturally, if you or your customers intend to benefit from preferential tariffs when importing goods, the goods must first comply with the relevant rules of origin stated in the EU-Vietnam Free Trade Agreement. Improper application or certification of the preferential origin may result in complications for both customers and suppliers. We recommend paying sufficient attention to the specific rules of origin and related formal requirements. This new agreement should also be acknowledged in supplier declarations issued within the EU.

It will still be possible to use the Generalised System of Preferences

Alongside the Free Trade Agreement, it will still be possible to use reduced tariffs according to the Generalised System of Preferences (GSP) for goods imported from Vietnam. Therefore, it is important to check which instrument for tariff reduction (GSP regime or the Free Trade Agreement) is more advantageous for your company; additionally, it is necessary to certify the preferential origin correctly.

The Free Trade Agreement also eases certain measures in the areas of banking, public procurement, technical barriers in the automotive and pharma industries, etc. It also covers the protection and recognition of geographical indications of traditional European food and drink products.

Given the approaching effective date of the Agreement and the possibility of applying lower or zero tariffs on imports of goods with the preferential origin in Vietnam, we recommend to analyse the impacts of the Agreement on your company and, if necessary, initiate communication with suppliers, requesting the necessary documents.

If you have any questions regarding the Agreement, we will be happy to assist you.