Thông tư 3/TM-CSTTTN

CIRCULAR

GUIDING THE IMPLEMENTATION OF THE GOVERNMENTS REGULATIONS ON GEM TRADING, IMPORT-EXPORT AND FASHIONING

-Pursuant to Decision No.65-CP of October 13, 1995 of the Government promulgating the Regulation on the Management of Gem Activities;
-Pursuant to Decree No.2-CP of January 5, 1995 of the Government specifying commodities and services banned from commercial business, and commodities and services allowed for conditional commercial business on the domestic market;
-The Ministry of Trade provides the following detailed guidance and regulations on gem trading, import, export and fashioning:

Chapter I

GENERAL PROVISIONS

1. The following gem activities: trading, import, export and fashioning of gems (including the making of jewels adorned with gems and fine-art items from gems) shall all have to comply with the concrete provisions of this Circular.

2. Gems, as defined in Article 1 of the Regulation on the Management of Gem Activities issued together with Decree No.65-CP of October 13, 1995 of the Government, include two groups:

Group 1: diamond, ruby, sapphire and emerald;

Group 2: other precious stones;

in the forms of raw material, semi-finished product, finished products or set in jewelry and fine-art items.

3. The State recognizes the lawful ownership by individuals and/or organizations of gems in the forms of raw material or fashioned products. The organizations and/or individuals lawfully possessing gems shall be entitled to store, transport, pawn, assign, trade or deposit them at banks or State treasuries.

4. The enterprises established under the provisions of law and meeting conditions provided for in this Circular shall be entitled to trade, import, export and fashion gems.

Enterprises established under the Law on Foreign Investment in Vietnam shall operate in gem business within the scope defined in the investment licenses granted by the Ministry of Planning and Investment.

5. Individuals and business groups which were granted business permits according to Decree No.66-HDBT of March 2, 1992, universities, vocational training schools, scientific research institutions, that meet the conditions provided for in this Circular are eligible for gem fashioning.

Chapter II

PROVISIONS ON GEM TRADING AND FASHIONING

I. GEM TRADING INSIDE THE COUNTRY:

1. Enterprises wishing to conduct activities in gem business shall have to apply for a gem trading license in accordance with the provisions of Decree No.02-CP of January 5, 1995 and this Circular; to register their business as prescribed by law and to comply with gem trading conditions in gem business.

2. The State encourages and creates favorable conditions for all organizations and individuals to trade in gems (as raw material, polished products, fashioned products or set in jewelry and fine-art items) at:

a/ Head offices of enterprises, gem and jewelry trading centers and shops of the Vietnam Gem and Gold Corporation and its member units.

b/ Head offices of other enterprises and shops which have gem trading licenses and registration certificates.

c/ Gem markets in the gem mining areas managed by the local administration with the participation of the Vietnam Gem and Gold Corporation.

Gems valued at 100 (one hundred) million VND or more each mined by bid-winning units, after being priced, shall be sealed and preserved at the Vietnam Gem and Gold Corporation for auction as prescribed.

3. Gem enterprises, when trading in or transporting gems, shall have to fully make receipts and vouchers as for other types of commodities in accordance with the regulations of the Ministry of Finance.

The trading of gems on gem markets as defined in Point 2c must be certified by the agency directly managing those gem markets.

4. Gems traded at gem trading centers and shops of enterprises must be of the exact type, quality, quantity and price as written in receipts and vouchers and, when necessary, must be checked and assessed by the goods standard, measurement and quality control agency and the market inspection agency.

Gem trading centers and shops when trading in artificial gems (including those set in jewelry and fine-arts items) must clearly post their types, quality, quantity and prices so as to be distinguished from the natural gems and this must also be clearly stated in receipts and vouchers of sale or transport.

5. Gems of all types when being traded in the country, shall not be subject to assessment; the assessment may be agreed upon by the purchaser and the seller.

6. Conditions for being granted gem trading licenses:

6.1. Conditions for business subjects:

According to Article 21 of the Regulation on the Management of Gem Activities issued together with Decree No.65-CP, "Any Vietnamese economic organization and/or individual wishing to fashion and trade gems and make jewelry or fine-art items from gems shall have to set up a production-business establishment and register its operations in accordance with the provisions of law"; under provisions of Decree No.02-CP, an organization and/or individual engaged in gem trading activities shall have to set up an enterprise.

An enterprise set up to conduct gem business activities is one established under the Law on State Enterprises, the Law on Private Enterprises and the Corporate Law. A cooperative established under the Law on Cooperatives which wants to trade in gems must be granted a business registration certificate by the provincial/municipal Peoples Committee.

The prescribed capital for the establishment of a gem-trading State enterprise shall comply with the provisions of Decree No.50-CP of August 28, 1996 of the Government; for other enterprises, pending the Governments amendments to Decree No.221/HDBT and Decree No.222/HDBT the following provisions shall temporarily apply:

- For a limited liability company, stock company or a cooperative:

One thousand (1,000) million VND.

- For a private enterprise: five hundred (500) million VND.

Enterprises previously established for other business lines and trades and now wishing to engage in gem business must obtain permission from the competent agency and must have the minimum prescribed capital as defined above.

6.2. Conditions on material and technical foundation:

a/ To have at least a gem trading shop or center.

b/ To have suitable measurement equipment and comply with the States provisions on expertise of measurement.

6.3. Conditions on professional qualifications and skills:

To have cadres or skilled workers who are knowledgeable about gems and have diplomas or certificates granted by a school or a course (which is allowed by a competent agency to train and foster workers in gemology for at least three months).

For skilled workers who have practiced gem business for many years only a written certification from the ward/commune Peoples Committee is required. The agency competent to grant gem trading licenses shall have the right to examine their professional skill.

7. The provincial/municipal Trade Service shall be the agency responsible for considering and granting gem trading licenses.

8. A dossier of application for a gem trading license shall be sent to the provincial/municipal Trade Service and include:

- The application for gem trading license.

- The decision on the establishment of the enterprise.

- The business registration certificate (if the enterprise has been doing business).

- The certification of the prescribed capital (for State enterprises, it shall be the decision on the capital allocation or supplement issued by a competent agency; for other enterprises, it is the certification of the enterprises capital deposited at the bank where it has opened its account).

- The certification of the enterprises business location issued by the ward/commune Peoples Committee.

- A list of standardized measurement equipment (with clear specification of their precision levels).

- Certificates of professional qualifications of officials and employees of the enterprise (diplomas or certificates showing that they have been trained or fostered in gemology; for persons who have practiced this business for many years, they need only the written certification from the ward/commune Peoples Committee).

For enterprises operating in other branches or trades which now want to engage in gem business, in addition to the above-said papers, the decision to add gem to their business lines issued by the agency which has issued decisions on their establishment is required.

For a gold business enterprise (with certificates of their gold business eligibility granted by the State Bank and gold business registration certificates), which wants to trade in gems set in jewelry- not unfashioned gems and separate gems, the dossier shall comprise only: the application for gem trading license, the decision on the establishment of the enterprise, the certificate of gold business eligibility and the gold business registration certificate. The agency competent to grant gem trading license shall in this case have to write down clearly in the license that the enterprise is entitled only to trade in gems set in jewelry.

The enterprise, after being examined by the provincial/municipal Trade Service regarding business conditions and granted a gem trading license shall have to register its business or add gems to its business registration in accordance with the provisions of law before conducting the gem business activities.

9. The enterprise applying for a gem trading license shall have to pay a charge for the assessment of business conditions and a permit granting fee as prescribed in inter-ministerial Circular No.72-TT/LB of November 8, 1996 of the Ministry and Finance and the Ministry of Trade.

II. GEM FASHIONING:

(including the making of jewelry and fine-art items from gems)

1. Enterprises, cooperatives, individuals and business groups engaged in gem fashioning (not in gem trading) shall have to meet the following conditions for being granted gem fashioning permits.

Universities, vocational training schools or scientific research institutions of which the training or research program includes gemology and which meet conditions defined in this Circular shall be eligible for gem fashioning (but not gem trading) after being granted gem fashioning permits.

2. Conditions for gem fashioning:

2.1. Conditions on material and technical foundation:

a/ To have a separate gem fashioning workshop with suitable equipment and tools for the fashioning.

b/ To have the suitable measurement equipment and to comply with the States provisions on expertise of measurement.

2.2. Conditions on professional qualifications and skills:

To have cadres or workers who are knowledgeable about gems and have diplomas or certificates showing that they have been trained or fostered in gemology for at least three months.

For skilled workers who have practiced gem business for many years, only a written certification from the ward/commune Peoples Committee is required. The agency that grants gem fashioning permit shall have the right to examine their professional skills.

3. Dossiers and procedures of application for gem fashioning permits shall comply with the provisions of Points 8 and 9, Part I of this Chapter (except for business capital certificates; for individuals and business groups the provisions of Decree No.66-HDBT shall apply; for universities, vocational training schools and scientific research institutions, the decision on their establishment is not required to be included in the dossier).

In cases where an enterprise or cooperative mentioned in Part I is simultanously engaged in both gem trading and fashioning, it shall have to make only one dossier to be submitted to the provincial/municipal Trade Service for the granting of one gem trading and fashioning license.

After being examined by the provincial/municipal Trade Service regarding their conditions and granted a gem fashioning permit, the enterprise shall have to register its business or add gems to its business registration in accordance with the provisions of law; individuals or business groups must obtain business licenses from the district Peoples Committee (of district, provincial capital or city) in accordance with Decree No.66-HDBT; universities, vocational training schools and scientific research institutions shall have to register for tax payment at a tax office.

4. The above-said organizations and individuals when fashioning gems for foreign countries shall have to abide by the regulations on processing goods for export and regulations on gem import and export provided for in Chapter III of this Circular.

Chapter III

PROVISIONS ON GEM IMPORT AND EXPORT

1. Only the following enterprises are entitled to import and export gems:

- Enterprises having gem exploitation permits granted by the Ministry of Industry.

- Enterprises having foreign investment licenses granted by the Ministry of Planning and Investment.

- Enterprises having gem business registration certificates.

Regarding capital: Enterprises specialized in gem business or in both gem business and exploitation of gems must have the minimum prescribed capital of five billion VND or an amount of capital in foreign currencies equivalent to 500,000 USD to be considered for the granting of gem import-export permits.

After being granted permit, if for two consecutive years the enterprise fails to achieve the gem import-export turnover of at least 500,000 USD, the Ministry of Trade shall, basing itself on the enterprises import-export turnover in comparison to the total gem import-export turnover and the import-export turnover of other enterprises, decide whether the enterprise may continue the direct import and export of gems or not.

An enterprise engaged in gem business but not qualified for import-export permit shall, when it needs to import, export gems, may assign the import or export to other enterprises which have gem import-export permits.

2. A dossier of application for a gem import-export permit shall be sent to the Ministry of Trade and include:

- The application for gem import-export permit.

- The decision on the establishment of the enterprise.

- The gem business registration certificate (for a newly-established enterprise which has not yet registered its business, it shall be the gem trading license granted by the provincial/municipal Trade Service).

- The gem exploitation permit granted by the Ministry of Industry for a gem exploiting enterprise.

- Diplomas or certificates of professional qualifications in foreign trade and foreign languages of cadres specialized in foreign trade.

An enterprise which is granted a gem import-export permits shall have to pay a fee as prescribed in Document No.1043-TM/XNK of November 16, 1992 of the Ministry of Trade.

3. For the foreign-invested enterprises, the import and export of gems must comply with the contents of the investment licenses granted by the Ministry of Planning and Investment and the annual gem import-export plans already approved by the Ministry of Trade.

4. Customs procedures for gem import-export shall comply with the following provisions:

4.1. Export of gems:

a/ For the export of gems valued at 10,000 USD and more, the enterprise shall have to produce to the bordergate customs service a dossier including:

- The gem import-export permit granted by the Ministry of Trade.

- The gem trading contract or a document of equivalent value to the gem trading contract (foreign trade contract).

- The gem assessment paper.

- The receipt of gem sale or purchase issued by the Ministry of Finance.

b/ If the gem export is valued at less than 10,000 USD, only the gem import-export permit and a receipt of gem sale or purchase issued by the Ministry of Finance must be produced to the bordergate customs service.

4.2. Import of gems:

The enterprise shall have to produce to the bordergate customs service a dossier including:

- The gem import-export permit granted by the Ministry of Trade.

- The gem trading contract or a document of equivalent value to the gem trading contract (foreign trade contract).

- The gem assessment paper.

All imported gems must be assessed. The assessment shall be conducted in either one of the two following ways:

a/ The enterprise must produce the gem lot assessment paper issued by an assessing organization which lawfully operates on the market where the gems are purchased, provided that such organization be chosen by the importer and accepted by the Ministry of Trade in advance.

b/ The bordergate customs service shall allow the enterprise to temporarily import the lot of gems after sealing it so that the enterprise sends the gems for assessment by an assessing organization lawfully operating in Vietnam. The assessing organization shall assess only the gem lots with intact seals of the customs, then the enterprise shall produce the gem lot assessment paper to the customs for the official import.

In case of any doubt about of the assessment result, the customs service shall have the right to request a re-assessment; in case of dispute on the assessment result, the State agency or the enterprise shall be entitled to request a re-assessment.

5. The non-commercial import or export of gems shall comply with the regulations of the General Department of Customs.

6. Provisions on the delivery of gems for overseas sales (including auction, sales at Vietnamese enterprises shops in foreign countries or sale at foreign companies shops):

6.1. Only enterprises that have gem import-export permits shall be entitled to send gems for sale abroad. The unsold lots of gems delivered for overseas sale or re-imported shall be all assessed, irrespective of their value.

6.2. Enterprises wanting to deliver gems for sale abroad shall have to submit dossiers to the Ministry of Trade for consideration and the granting of an import-export permit. Such a dossier shall include:

- The application for the permit to deliver gems for sale abroad.

- The gem import-export permit granted by the Ministry of Trade.

- The permit for opening branches or shops of the enterprise in a foreign country (granted by that country), if gems are delivered for sale at the enterprises shops in the foreign country.

- The contract on the assignment of gems for sale at shops of foreign companies, if the enterprise assigns the sale of gems.

6.3. When transporting gems for sale abroad, the enterprise shall have to produce to the bordergate customs service a dossier comprising:

- The consignment import-export permit.

- The gem assessment paper.

- The distribution order.

6.4. The enterprise shall have to transfer home the total amount of foreign currency(ies) gained from the sale of gems abroad in accordance with the current regulations of the State Bank and shall have to pay export tax according to the corresponding goods value.

7. The enterprise that delivers gems for an overseas exhibition or fair shall have to comply with the Regulation on Exhibitions and Fairs issued together with Decision No.390-TTg/XNK of August 1st, 1994 of the Prime Minister and guiding Circular No.05-TM/XNK of February 25, 1995 of the Ministry of Trade. In this case, gems temporarily exported and re-imported, after the closure of the overseas exhibitions or fairs, irrespective of their value, must be assessed in accordance with the provisions of this Circular.

8. Provisions on temporary import and re-export of gems (purchase of gems from one country for temporary import and for re-export to another country):

8.1. Enterprises with gem import-export permits shall be entitled to temporarily import for re-export of gems but shall have to comply with the regulation on business in form of temporary import for re-export issued together with Decision No.1064-TM/PC of August 18, 1994 of the Ministry of Trade.

Gems of various types which are temporarily imported and re-exported, irrespective of their value must be assessed. The assessment of temporarily imported gems shall comply with Point 4.2.

8.2. When temporarily importing and re-exporting gems, the enterprise shall have to produce to the bordergate customs service a dossier comprising:

- The permit for temporary import for re-export granted by the Ministry of Trade.

- The gem assessment paper.

9. Provisions on the fashioning of gems for foreign countries:

The fashioning of gems for foreign countries mentioned in this Circular is the receipt of gems from a foreign enterprise for fashioning in Vietnam for remuneration paid by that foreign enterprise.

9.1. Conditions for being entitled to fashion gem for foreign countries:

Enterprises with gem import-export permits, organizations and individuals having gem fashioning establishments as stipulated in Part II, Chapter II of this Circular shall be entitled to fashioning gem for foreign countries. A dossier sent to the Ministry of Trade for gem fashioning permit for foreign countries shall include:

- The application for the permit to fashion gems for foreign countries.

- The gem import-export permit or the gem fashioning business registration certificate (for universities, vocational training schools and scientific research institutions, a gem fashioning permit granted by the provincial/municipal Trade Service is required).

- The contract on gem fashioning for foreign countries together with the agreement on the percentage of material loss in fashioning, if it is not specified in the contract.

9.2. Enterprises, organizations and individuals meeting conditions prescribed in Point 9.1, after being granted the gem fashioning permits by the Ministry of Trade shall be entitled to directly conduct the temporary import of raw material gems and the re-export of finished gem products as prescribed.

All types of raw material gems, when temporarily imported for fashioning, and finished gem products when re-exported shall have to be assessed, irrespective of their value. Upon the temporary import of raw materials, the assessment shall be conducted in one of the two ways mentioned in Point 4.2.

9.3. When temporarily importing or re-exporting gems fashioned for foreign countries, the enterprise shall have to produce to the bordergate customs service a dossier, including:

- The permit for gem fashioning for foreign countries granted by the Ministry of Trade.

- The contract on gem fashioning for foreign countries together with an agreement on the percentage of wasted materials if it is not specified in the contract.

- The gem assessment paper.

10. Regarding gem assessing agency:

Pending the Governments "Regulation on the Assessment and Inspection of Goods Assessing Organizations", the assessment of imported and exported gems mentioned in this Circular shall be conducted by the enterprises which have the function of assessing imports and exports and by gem assessing agencies which have been operating upto the promulgation of this Circular.

The assessment of gems set in jewelry made of gold, silver or other precious metals may be conducted simultanously with the assessment of the gold, silver or other precious metals at the imported and exported gold-assessing centers in accordance with the provisions of the State.

After the Government issues the "Regulation on the Assessment and Inspection of Goods Assessing Organizations", such Regulation shall apply.

11. The gem import and export tax shall be paid in accordance with the provisions of law.

Chapter IV

INSPECTION AND HANDLING OF VIOLATIONS

1. Organizations and individuals engaged in gem trading, import, export and fashioning, in making jewelry and fine-art items from gems that violate the provisions of this Circular and related provisions of the State shall, depending on the nature and extent of their violations, be handled administratively or examined for penal liability in accordance with the provisions of law.

2. The Ministry of Trade, the provincial/municipal Trade Services and other competent State agencies shall have to inspect and handle violations committed by organizations and/or individuals operating in gem business in the light of the provisions of Decree No.65-CP and this Circular.

Chapter V

IMPLEMENTATION PROVISIONS

1. This Circular takes effect from July 1st, 1997; the earlier provisions which are contrary to this Circular are now annulled.

2. From now till the end of July 1st, 1997, all organizations and individuals operating in gem trading, import, export and/or fashioning as well as in making jewelry and fine-art items from gems shall have to fill the new procedures stipulated in this Circular. After July 1st, 1997, organizations and/or individuals that are unqualified for gem trading, import, export and fashioning as well as for making jewelry and fine-art items from gems or fail to refill the procedures provided for in this Circular, shall not be allowed to operate in gem business.

From now till the end of July 1st, 1997, the enterprises which have been granted gem import-export permits by the State Bank of Vietnam and which import or export gems, including the temporary import and re-export or the delivery of gems for overseas exhibitions, fairs or auction, shall have to submit dossiers to the Ministry of Trade for consideration and granting of consignment import-export permits.

3. Enterprises granted gem import-export permits by the Ministry of Trade shall have to periodically (every quarter) report on their gem import and export situation to the Ministry of Trade (the Department for the Management of Import and Export).

4. Units that are granted gem trading or fashioning permits by the provincial/municipal Trade Services shall have to report periodically (every quarter) on their business activities to the provincial/municipal Trade Services so that the latter may sum up and report the situation to the Ministry of Trade (the Department for Domestic Market Policies)

APPENDIX FOR REFERENCE

Organizations, agencies and enterprises which have the function and facilities to train gem fashioners and jewelers to make gem jewelry and fine-art items

1. The Vietnam Gem and Gold Corporation- 91 Dinh Tien Hoang, Hanoi, which have two establishments located at:

- The Hanoi Gem and Gold Company- 2 Trieu Quoc Dat, Hanoi.

- The Hanoi Gem and Gold Assessing Center- 91 Dinh Tien Hoang, Hanoi.

2. The Gem and Gold Corporation (attached to the State Bank of Vietnam)- 23 Quang Trung, Hanoi.

3. The Vietnam Jewelry and Fine-Arts Association.

4. The Industrial Fine-Arts School- La Thanh road, Hanoi.-