Luận văn_Vietnam customs and ecustoms declaration in bac ninh customs

MINISTRY OF EDUCATION AND TRAINING HANOI UNIVERSITY OF BUSINESS AND TECHNOLOGY FACULTY OF ENGLISH * * * * * GRADUATION ASSIGMENT VIET NAM CUSTOMS AND E-CUSTOMS DECLARATION IN BAC NINH CUSTOMS Student: HANOI, TABLE OF CONTENTS TABLE OF CONTENTS ACKNOWLEGEMENTS ABBREVIATION INTRODUCTION .4 CHAPTER I INTRODUCTION OF VIET NAM CUSTOMS Functions 1.1 Organization structure: Statement of Vietnam customs 2.1 Vision 2.2 Mission statement CHAPTER II CURRENT SITUATION OF BAC NINH E-CUSTOMS DECLARATION Process of the application of e-customs declaration in Bac Ninh customs Model of e-customs declaration in Bac Ninh customs 11 Positive results after applying e-customs declaration 12 - Improved customs procedures: 13 - Modernization of customs staffs team: 15 CHAPTER III 18 THE DIFFICULTIES IN THE PROCESS OF E-CUSTOMS DECLARATION OF BAC NINH CUSTOMS 18 The lack of information technology and infrastructure 18 Computer skill and professional ability of enterprises and customs offices .23 CHAPTER IV 24 SOLUTIONS TO IMPROE E-CUSTOMS DECLARATION OF BAC NINH CUSTOMS 24 1.Improvement of information technology and infrastructure .24 The use of human resource management 26 CONCLUSION 30 BIBLIOGRAPHY 31 ACKNOWLEGEMENTS I wish to express my sincere thanks and special gratitude to Mrs.y tutor in studying theory, who kindly supervised and gave me encouragements at all stages of my work I am grateful to the leader, the heads of three teams and all members of Bac Ninh Customs, who whole-heartedly provides help and co-operation for my thesis Though I am not working in a company, the knowledge that I study in Ha Noi University Business and technology (HUBT) is very valuable and I am very happy to apply it to the development of Bac Ninh Customs I am indebted to the HUBT for having provided me the interest to study ABBREVIATION GDVC: General Department of Vietnam Customs IT : Information Technology LAN : Local Area Network WAN : Wide Area Network LAN : Local Area Network INTRODUCTION Along with the rapid development of international trade in some recent years, the quantity of imports and exports through a country is more and more increased The diversification of international business transaction requires each country to improve and modernize customs procedures; research and apply modern customs management methods to create favorable conditions for import and export activities of companies, push up the development of economy but still ensure the country’s security Vietnam customs is striving to reach: “the advanced management level of other regional customs administrations , transparent legal system in compliance with international standards; professional and specialized staff; clearance system mostly based on automation and application of risk management and modern technical equipments in order to facilitate trade and attract foreign direct investment making active contribution to the fostering of economic growth, national revenue collection and security” While considerable reform measures have been undertaken recently, Bac Ninh customs is still considered slow, lack of information technology and infrastructure The Customs administration will need to change significantly in the direction of modernization, improvement of information technology and infrastructure As a citizen of Bac Ninh city, I have been watching the positive change of my city In term of modernization, Bac Ninh customs is now concentrating on the implementation of electronic customs declaration, the first stage of ecustoms procedures That is the reason for my GRADUATION ASSIGNMENT: “Vietnam customs and E-customs declaration in Bac Ninh customs” CHAPTER I INTRODUCTION OF VIET NAM CUSTOMS Functions The main function of Vietnam Customs is the State management over customs with regard to exported, imported or transited goods, transport means on exit, entry and in transit, of foreign and domestic organizations and individuals; and the organization and operation of the customs service 1.1 Organization structure: The Customs Administration has undergone several organizational and structural changes over the last 60 years since its birth in 1945 The General Department of Viet Nam Customs (GDVC) was established in April 1984 and placed directly under the Government’s authority but in September 2002, it was placed under the Ministry of Finance As a result, the strategic planning process has also been altered accordingly The organizational system of Vietnam Customs now consists of: a/ The General Department of Customs; b/ Customs Departments of provinces, inter-provinces, and centrally-run cities; c/ Border-gate customs sub-departments, customs control squads and equivalent units - Task of the customs service: +To propose policies and measures for customs-related state management over the import, export, exit, entry and transit activities as well as tax policies applicable to import and export goods +To inspect and supervise goods and means of transport; +To prevent and combat smuggling and illegal cross-border transportation of goods +To organize the implementation of tax law applicable to import and export goods +To make statistics on import and export goods - Principles for organization and operation of the customs: + Vietnam Customs shall be organized and operate according to the principles of centralized and uniform command + The General Director of Customs shall uniformly manage and execute activities of the Customs at all levels; the Customs at lower level shall submit to the management and direction by the Customs at higher level Statement of Vietnam customs 2.1 Vision The Customs of Vietnam is a highly professional, modern, transparent, and effective Customs Administration meeting requirements of actual situations and national economic development 2.2 Mission statement + Enforcing the effective management over imports & exports activities and international trade, providing favorable conditions to the trade and production development + Protecting and contributing to the facilitation of development of national economy + Protecting revenues + Fighting against smuggling, combat commercial fraud, protecting the interests of consumers + Contributing to the protection of economic sovereignty, national security and community security CHAPTER II CURRENT SITUATION OF BAC NINH E-CUSTOMS DECLARATION Process of the application of e-customs declaration in Bac Ninh customs According to Decision 149/QD-TTg by the Government, the first period is the experimenting application of e-customs procedures at Hai Phong and Ho Chi Minh customs departments Based on the result of the first period, the second period will be widening to other applicable departments Hanoi customs department is one of those departments in the second period Being a sub-department of Hanoi Customs, Bac Ninh customs has been quickly planning and implementing e-customs procedures The process of the application of e-customs declaration in Bac Ninh customs was divided into two phases: - The first phase: E-customs declaration was experimentally implemented at industrial team (customs procedure team for managing industrial zones) This team was equipped with one International Business Machines (IBM) server and ten computers Besides, there are computers with ready software of e-customs declaration for enterprises to learn and implement ecustoms declaration At that moment, registration customs officers are also equipped with knowledge of e-customs declaration, so that they can not only receive and perform their jobs with the data from enterprises, but also to some extend, understand how to use e-customs declaration software Because this software is absolutely new to enterprises, enterprises may face difficulty in declaring e-customs, then customs registration officer, who directly communicate with enterprises, help enterprises solve the problem Hanoi customs department understood the situation, so they organized training programs for both customs officers and enterprises, where most worries and questions were answered by the software writer and network administrators Table 1: Number of e-customs declaration form registered in first phase Year 2007 Apri Ma Jun Jul Augus Septembe Octobe Novembe Decembe l y e y t r r r r 361 548 706 782 Number of ecustoms forms 172 373 381 120 registere d (Source: Report of e-customs declaration by Industrial team) Despite of many difficulties, it is fortunate that this program is welcome and Bac Ninh customs received support from enterprises Canon Vietnam Co., ltd – Que Vo Branch is the first enterprises to apply e-customs declaration model in Bac Ninh, therefore, a lot of other enterprises were also eager to take participation The number of e-customs declaration form is therefore increased month by month After ten years of establishment and development, due to the clear-sighted leading policy of the leaders and the determination of all customs officers, Bac Ninh customs have achieved remarkable results With the main motivation to the modernization of customs, Bac Ninh customs progressively improves customs procedure, standardizes team of customs officers and build up a co-operative relationship between customs office and enterprises After application of e-customs declaration in Bac Ninh customs Bac Ninh customs has achieved few positive results Besides it faces to many difficulties below 17 CHAPTER III THE DIFFICULTIES IN THE PROCESS OF E-CUSTOMS DECLARATION OF BAC NINH CUSTOMS Beside the positive results in more than one year of implementing e-customs declaration, Bac Ninh customs also faced a lot of difficulties and obstacles, not only in the operation of e-customs procedures, but also the preparation process to e-customs clearance in the future The lack of information technology and infrastructure * Information technology (IT): - Declaring model through website: This method is very useful for small enterprises or for enterprises seldom imports and export Enterprises just need to declare its tax code and input the data from the customs registration form to send to customs office However, it actually seems to be unused in Bac Ninh customs because of the defects of the website The website only let enterprises declare customs form in case of commercial contract (sell and buy through bolder gates) The type of processing contracts and importing materials to export was not updated, so it can be supported for liquidity This function is important and valuable to Bac Ninh customs, because processing contracts and importing materials to export activities account for a big proportion of customs procedures Therefore, declaring through website is little known and rarely used - Declaring through Thai Son company’s software: 18 E-customs declaring software built by Thai Son company in comparison to website declaring method has the ability to work with the liquidity of processing contracts and importing materials to import types Enterprises buy and install the software in their own computers to declare to customs office through Internet The data is saved in the computer to support for liquidity Thank to this, computer can automatically calculate the remaining materials left of enterprises, reducing labor force to hand-work liquidity Thai Son company’s e-customs declaration software has three versions: + ECUS-K: for declaring e-customs with commercial contracts; + ECUS-G: for declaring e-customs with processing contract; + ECUS-X: for declaring e-customs with importing materials for exporting products However, Thai Son company does not have enough ability to provide software maintenance and support for more and more enterprises from all regions in our country Moreover, this program is newly written, then it has some errors cannot update to be suitable for the real situation of Bac Ninh customs, which leads to the worry of enterprises in buying and implementation of the software - The relationships with other related organizations: The experienced lessons in other countries show that in order to set up a successful e-customs procedure, it is important to have an electronic governmental basis, a management information system to combine strictly and consistently database between customs offices and other related organizations such as: investment authorized organizations, shipping 19 agencies… However, with limited sources of capital, this process in Vietnam is undisciplined Therefore, customs officers, who have responsibility to manage the information of the company and its import/export goods but also, have to create favorable conditions to company, actually work with their own knowledge and experience - The quality of the internet line: According to le policy of the General department of customs about consistent management in all customs departments, the data of e-customs declaration form from enterprises to customs office and the feedback from customs office to enterprises is transferred through internet The internal Megawan line from Bac Ninh customs to Hanoi customs is very good, but the internet line in Bac Ninh province is sometimes disconnected because of the bad quality and small bandwidth Enterprises in this case have to wait and connect many times to transfer data, the advantageous function of ecustoms declaration is then lost - There lacks a comprehensive IT development strategy At present, IT planning is made only on annual basis subject to budget availability rather than on a long-term basis setting out directions for the whole process of reform and modernization Moreover, IT development planning has not been combined with business process reform planning; - A strong and comprehensive IT system is not yet available for business automation At present, computerization is taken merely for the purpose of supporting procedures processing through automating manual procedures without considering potentials for further expansion of computer-based activities 20 - Lack of funding for IT is also an impediment to its development * Financial capacity of enterprises and facilities of customs office - Enterprises: Bac Ninh is now considered a province with economic potential in our country There are not so many big entrepreneurs here and most of them are from the capital of foreign direct investment Small and medium enterprises take the minority in this region and their ability to pay for e-customs declaration is limited In the other hand, foreign invested enterprises with modern working and law abiding style find it easier to implement e-customs declaration The complication of management mainly comes from small and medium enterprises, who often deal with processing and importing materials to export activities The high cost of the software is the barrier for them to participate in e-customs declaration It is a difficult-to-solve problem to Bac Ninh customs when enterprises can understand the advantages of the software but still hesitate to buy the software - Customs office: At this moment, all computers serving for e-customs declaration in Bac Ninh customs are new, modern and appropriately arranged However, there are still shortages of computers for the receiving e-customs declaration forms In addition, Bac Ninh customs need computers for training program and support enterprises that not possess authorized software to declare right at customs office This is important because most enterprises who declare at customs office find it difficult to use the software, and when all computers are fully used, other enterprises have to wait to have a spare computer 21 In the other hand, the increasing number of customs declaration forms leads to the overload of the 24/24 working hour servers The other computers will then operate with lower speed; therefore the work of customs officer is less efficient It is clear that there is a need to upgrade the facilities of Bac Ninh customs However, state budget for Bac Ninh customs is limited In order to have new computers, Bac Ninh customs need to propose to Hanoi customs department and wait for their approval - In customs working offices, esp at branches, there are still too many old and poorly maintained offices - many with unsuitable layouts and inadequate work spaces that need to be addressed by a comprehensive investment and maintenance program - In relation to control equipment, there is a shortage of modern control equipment and significant redundancy of existing equipment This combination means that there is insufficient equipment plus the absence of a technical maintenance system together with a homogenous business process; as a consequence, the control capabilities are compromised - There lacks a scientific asset management and long-term planning mechanism The current system is basically confined to maintenance of an asset register and does not have the asset management planning capability to develop a clear longer-term infrastructure and equipment development strategy, as opposed to the current annual requirements system of forecasting 22 Computer skill and professional ability of enterprises and customs offices - Staffs of enterprises In order to create favorable conditions for enterprises to understand and know how to use the e-customs declaration software, Bac Ninh customs organized many classes at the most suitable time However, the rate of wrong declaration is still high One reason for that bad situation is the computer skill and professional ability of the staffs of enterprises Most of enterprises in Bac Ninh province are small and medium sized, the ability of their staffs about computer skill is not very good Therefore, companies themselves diminish the advantages of enterprises when taking part in ecustoms procedures - Customs officers: Not only staffs of enterprises but also some customs officers are not skillful at using computer Only 70% customs officers who are involved in ecustoms procedures are expert at professional knowledge and skilful at using computer The rest 30%, mostly old customs officers, find it hard to deal with computer efficiently 23 CHAPTER IV SOLUTIONS TO IMPROE E-CUSTOMS DECLARATION OF BAC NINH CUSTOMS Improvement of information technology and infrastructure - It is necessary to amend, upgrade e-customs software to be compatible with database system and support all types of import and export activities This software must possess all functions to guarantee that enterprises can declare at any time, from anywhere and enterprises can change their data in case of mistaken registration - It is also necessary to enhance the functions of the software by encouraging more programming companies to participate and compete actively with software of Thai Son company The General department of customs just announced the standards to connect to e-customs and data exchange system The programming companies should have close relationships to the customs offices to understand correctly customs procedures and the difficulties need to overcome when declaring e-customs - The model of declaring through website should be working and have more functions to suit with all types of customs declaration The fully functioning website would help enterprises, especially small and medium enterprises, easily participate to e-customs procedures because declaring through website costs little for installation, maintenance, and enterprises can declare at any time, from anywhere - In short term, it is necessary to develop both two models of e-customs declaration However, for a far outlook, to make e-customs declaration 24 completely suit with the world’s customs standards, the two models should be combined into one model of declaring through a Value Added Network (VAN) With this network, data will be consistently managed and easily exchanged in customs fields and other state offices - To succeed, it is important to keep all data of e-customs declaration in a single server setting up in Bac Ninh customs or Hanoi customs department At the moment, all declaration data of enterprises is kept in their own computers It would be risky in case of broken computers, and then all valuable data would be gone Therefore, if all the data is kept in a server of customs office, enterprises can easily exchange data, upload or download Enterprises can declare at anytime, from anywhere with no worries of losing data - Develop and widely introduce a modern information system towards establishing an electronic customs system - Invest synchronic hardware to support the operation of a new centralized processing programme across the whole the administration - Customs information system operates consistently with information systems of Ministry of Finance sharing the same infrastructure including WAN, preventive centre and verification system - Improving the quality of the transferring lines: At the moment, e-customs declaration data from enterprises is sent to Hanoi customs department through internet, then it would automatically transferred to Bac Ninh customs through a leased line However, the internet line of Bac Ninh province is not very good It is necessary to improve the internet line in both quality and bandwidth to ensure the continuality of e-customs declaration 25 About the leased line, there should be another line in case one leased line is unable to function - Right at Bac Ninh customs offices (head office and Que Vo industrial park), there should be an internet system (LAN and WIFI) so that enterprises can use their own laptops to declare This would solve the problem of computer shortage, and then enterprises will be more active in declaration - Infrastructure: Bac Ninh customs is situated in a big area of land, however the room for professional activities is small The number of computers supporting for declaration of enterprises is limited Even if Bac Ninh customs is equipped with more computers, it is hard to arrange new tables because the room seems to be overload Therefore, in long term, Bac Ninh customs need to rebuild it offices to suit with the importance of a state office in managing import and export activities - Bac Ninh customs should be equipped with an electric generator with high capacity to work in case of emergency when the electricity went out - Heighten the quality of the network administrators: encourage the network administrator to join more professional training classes to improve the working ability Bac Ninh customs now own just one network administrator, therefore, it is necessary to select some more network supporter It is important because Bac Ninh customs is working in two offices geographically, and when the network administrator is absent, there are people to solve the problem of computer network system The use of human resource management - The rearrangement of customs officers: 26 - Bac Ninh Customs include 37 members; however, more than half of them are over 40 years old Then their ability to deal with huge amount of work is limited Nowadays, the need for high speed and accuracy is more and more important, especially when working with e-customs procedures, customs officers need to be quick and obtain fluent computer skills Therefore Bac Ninh customs need to restructure its organization to increase its effectiveness - Use right person in right position - Young customs officers with high base of education (bachelors, etc…) should work in step or of e-customs procedures (primary and documents inspection), because these positions requires knowledge in international trade, skills in computers and languages They are the people to resolve problems of enterprises involving e-customs declaration - Old people should be in step (actual goods inspection) to take advantage their experience in goods inspection - Moreover, there should be the rotation of customs work to guarantee that all customs officers have the ability to all kinds of work, but be excellent at one type of work - The leader (head of team) should involve directly in work, to understand more about the work, not just assign and look staffs to their task, and to reduce pressure for staffs - Propose to higher customs office level to demonstrate the shortage of human resource because of the increasing of huge amount of work, in order to be filled up with new customs officers 27 - The education, training and development of human resources: The development and management of human resources is one of the key factors to the success of e-customs procedures for Vietnam customs generally and Bac Ninh customs particularly Understanding this importance, Bac Ninh customs pay much attention to their customs officers; combine strictly with Hanoi customs department to build up a strong and skillful team of officers with their continuously improved abilities - Bac Ninh customs open classes for all customs officers to understand and raise professional abilities The classes are based on the study and analysis of the learning demand of customs officers - The lectures should not only come from Bac Ninh customs but form other customs offices, which have the deep professional knowledge and educational ability to make customs officers fully understand the lessons - The form and method of education should be diversified Training classes can be open in the evening, directly or remotely… to serve the need of customs officers Beside the traditional method of education, it is necessary to supplement some more active learning methods such as: discussion, seminar, and practice on the spot… - The recruitment of customs officers is extremely important Bac Ninh customs with the co-ordination of Hanoi customs should select among candidates the best The chosen candidates must be educated about customs professions, capable of computer and language skills and possess good working manner Bac Ninh customs propose to Hanoi customs some positions in shortage in order to be fulfilled soon 28 - Research and develop the method of customs internship It is for newly graduated students to make use of their knowledge and approach to the working customs situation It is also for key customs officers to go to other customs offices in our country or abroad to capture more knowledge and experiences - There should be special policy to stimulate customs officers to demonstrate their ability and contribution to customs office Bac Ninh customs should have some competing program or give award mentally and materially to customs officers who work most efficiently and make the best contribution in work Only with the policy of development and encouragement, customs offices may attract talented person from all regions in the country, making great advances to the quality of customs officers 29 CONCLUSION Viet Nam customs is now an urgent need to carry out customs modernization and reform with the aim to establish a transparent and strong administration meeting national cause of modernization and industrialization requirements Customs modernization helps to enhance state management capacity within the administration create a conductive environment for import, export, to develop tourism, to attract foreign investment and increase competitiveness of Vietnamese businesses through lowering transaction costs related to import and export procedures With a special position in the international trade environment, a modern and effective customs administration will make useful contribution to the successful realization of the obligations and commitments Vietnam has made during the international economic integration process Customs reform and modernization is designed to be implemented in a synchronized and systematic way in all aspects including legal framework, customs system and procedures; organization and management, and information technology As a body attached to Hanoi customs department, Bac Ninh customs is now strategically implementing modernization process, one of the most importance is e-customs declaration The application of e-customs declaration not only reduces pressure to customs officers but also make contribution to facilitate customs procedures related activities for enterprises 30 BIBLIOGRAPHY Legal and regulatory documents Decision 52/2007/QD-BTC dated 22 June 2007 by Ministry of Finance of experimenting e-customs procedures; Decision 149/2005/ND-CP dated 20 June 2005 by The Government of pilot implementation of e-customs procedures Books: Pham Duy Lien (2007), Some basic issues of customs professions, Statistical Publishing House Luck De Wulf & José B, Sokol (2007), Handbook of Customs Modernization, Political Publishing House Newspaper and magazines Customs Newspapers from 2005 to August 2008 Customs research magazines from 2003 to August 2008 Websites Website of Bac Ninh province http: //www.bacninh.gov.vn 31 ... CURRENT SITUATION OF BAC NINH E -CUSTOMS DECLARATION Process of the application of e -customs declaration in Bac Ninh customs Model of e -customs declaration in Bac Ninh customs 11 Positive... enterprises to take part in e -customs procedures 10 Model of e -customs declaration in Bac Ninh customs At the moment, e -customs declaration in Bac Ninh customs is working in two different ways:... Vietnam joining WTO, Bac Ninh customs officers have been participating in training programs of Hanoi customs The director of Bac Ninh customs also organizes some short courses for their customs