Plea for Vietnam to ease car curbs

Thailand has repeated its call for Vietnam to scrap automobile import measures and looks set to raise the issue during talks at the June meeting of the Thailand-Vietnam Joint Trade Committee.

According to Oramon Sapthaweetham, director-general of the Trade Negotiations Department, Thai negotiators have been attempting to settle the issue through all possible avenues, including the World Trade Organization, contending that Vietnam’s new decree to curb automotive imports does not comply with WTO agreements and results in shipment delays and higher expenses for exporters.

The Vietnamese government on Oct 17, 2017 issued Decree No.116, meant to facilitate development of the automotive industry. The decree set out conditions for the manufacture, assembly, import, and offer of warranty and maintenance services for cars.

The decree, which came into force in January, states that only companies — not individuals — will be considered for automobile import business licences. These companies must also have facilities for automobile warranty and maintenance either under their ownership, under lease or through their authorised dealerships.

Notably, the decree also puts forward a stringent requirement for auto importers to obtain documents certifying or documenting that they are authorised to act on behalf of the foreign automobile manufacturers and assemblers to recall imported cars in Vietnam.

This may spell an end to small-scale auto importers in Vietnam, as international car manufacturers are not likely to let unofficial dealers conduct recalls.

Another detail within the decree is the tightening of regulations on imports of used cars. Any used cars imported into Vietnam must be registered for circulation in countries with equivalent or more stringent emissions standards than those in Vietnam.

In addition, when conducting inspections for used vehicles with quality management agencies, importers must be able to provide valid circulation registration certificates up to the date of export granted by a competent foreign agency, or papers of equivalent legal validity.

Used cars are required to have a warranty period of at least two years or 50,000km for small cars, and at least one year or 20,000km for other types of cars.

“Such stringent measures are regarded as discriminatory practices,” Mrs Oramon said.