HCM City (VNA) – Ho Chi Minh City plans to step up enforcement against smugglingand trade fraud to cope with the increasing number of violations, especially atCat Lai Port. 

A number of smuggling cases have taken place at internationalports, especially at the Cat Lai Port, the country’s largest internationalcontainer port.

Since early 2015,the Customs Department has detected nearly 500 smuggling and trade fraud casesat the Cat Lai Port.

In 2015, therewere 165 cases, and 206 cases in 2016. In addition, there were 107 cases in thefirst half of this year.

At the port border corridor area, the HCM City Border Guard forcehas uncovered five cases since January, including the smuggling of goods worthup to billions of VND.

According to the Customs Control Division of the city’s CustomsDepartment, the number of violations and cases indicating violations (now beingverified by agencies) is actually much higher than reported.

Loopholes

The currentsystem of inspections at the Cat Lai Port leaves a loophole that allowsenterprises to smuggle.

When anenterprise completes e-customs declarations, for example, the computer systemwill classify the goods into one of three colour categories: red, yellow andgreen.

If classified as red,the shipment will be directly inspected by the customs officer.

If  yellow,the shipment will not be inspected and the customs officers will only check thedocuments.

For green, thegoods are exempt from inspection.

The customsclassification system is based on the history of the company (whether itobserves customs regulations and completes tax obligations).

However, expertswarned this system has caused challenges for detecting smuggling and tradefraud at the port.

The company canfollow regulations today, while it doesn’t necessarily mean that the next timethe company will not violate regulations, experts said.

Several smugglingenterprises have even hired businesses classified as green to completee-customs declarations in order to smuggle goods into the country.

The HCM CityPolice and Ministry of Public Security have discovered many smuggling casesrelated to businesses classified as green or yellow.

Colonel Nguyen HongDung, chief of the Crime and Drug Prevention Division under the HCM City BorderGuard, said some businesses engaged in smuggling were taking advantage of aregulation that allows them to temporarily import goods for re-export.  

For example,after goods imported for re-export are cleared at the Cat Lai Port, instead ofbeing transported straight to Cambodia for re-export according to regulations,the enterprises transport the goods to warehouses in HCM City or Long An and TayNinh provinces and remove the goods from the containers, he said.

The enterprisesthen transport the empty containers in vehicles or on vehicles carryingvegetables to Cambodia to make their operations appear legal, Dung said.

Solutions

The HCM CityCustoms Department has recommended raising the fine for violations of“temporarily importing for re-export” as the current penalty of 10-30 million VND(450-1,300 USD) is too low.

To preventsmuggling or trade fraud at the Cat Lai Port, the customs department and otheragencies have proposed installing screening machines at the port facility, withmonitoring done by multiple functional units (instead of only one) in order toavoid corruption.

In the long run,it should be taken into account that all imports and exports at ports must becontrolled, inspected and investigated by customs clearance offices instead ofbeing based on classification systems (red, yellow and green).

Le Nguyen Linh,deputy head of the Customs Department of the Sai Gon Port - Area 1, said theunit was implementing many solutions to prevent smuggling at the port.

The solutionsinclude strengthening customs inspection and promoting dissemination ofinformation for enterprises to comply with customs regulations.

He said it wasvital to raise public awareness about the harmful effects of smuggling, tradefraud and counterfeit goods.-VNA