1. How Vietnamese Export Factories Import Raw Materials Duty-Free: Codes E21 vs. E31 vs. A12
When pitching raw materials (Nguyên vật liệu — NVL) to a Vietnamese garment mill, packaging converter, furniture plant, or electronics assembler, foreign sales directors must understand the four Vietnamese Customs Procedure Codes (Mã loại hình nhập khẩu):
• Code E21 (Nhập nguyên liệu sản xuất gia công): Duty-free and VAT-exempt import of raw materials for toll/contract manufacturing (Gia công) where a foreign principal retains title to the inputs.
• Code E31 (Nhập nguyên liệu sản xuất xuất khẩu — SXXK): Duty-exempt and VAT-exempt import of raw materials purchased directly by a Vietnamese factory to manufacture finished goods for export. Code E31 also governs on-site imports (Xuất nhập khẩu tại chỗ) involving Export Processing Enterprises (EPEs / Doanh nghiệp chế xuất).
• Code A12 (Nhập kinh doanh sản xuất): Dutiable import of raw materials for domestic Vietnamese consumption (where FTA Certificates of Origin like Form D, Form E, Form AK/VK, CPTPP, or EUR.1 eliminate the tariff).
2. Why Annual Customs Settlement (Form 15/BCQT-NVL/GSQL) Dictates Supplier Selection
Under Article 60 of Circular 38/2015/TT-BTC as amended by Circular 39/2018/TT-BTC, every Vietnamese factory importing duty-free raw materials under E21 or E31 must submit a mandatory annual Import–Export–Inventory Customs Settlement Report (Báo cáo quyết toán tình hình sử dụng nguyên liệu, vật tư — Form 15/BCQT-NVL/GSQL) within 90 days of fiscal year-end.
In Form 15, the factory's accounting and customs system must reconcile every kilogram or linear meter of imported yarn, fabric, resin, or steel against actual exported finished product Bill of Materials norms (Định mức thực tế) and physical warehouse inventory. If a foreign raw-material supplier ships resin bags with ±2% net-weight variance, fabric rolls with unrecorded yardage shortages, or Commercial Invoices whose HS codes and unit descriptions deviate from the factory's registered E31 norm code, the Vietnamese factory triggers a post-clearance customs tax audit (Kiểm tra sau thông quan). Foreign suppliers who guarantee 100% Form 15-aligned packing lists and exact net-weight precision win long-term Tier-1 contracts.
3. Winning Factory Nomination via EVFTA Cumulation (Korean & EU Fabrics) & CPTPP
Foreign raw material mills can strengthen their value proposition to Vietnamese export factories by aligning with FTA cumulation rules: under MoIT Circular 11/2020/TT-BCT, South Korean and European textile mills supplying woven or knit fabrics into Vietnam enable the Vietnamese garment factory to qualify for duty-free EVFTA export (Form EUR.1) into Europe. Similarly, CPTPP-origin yarns, chemicals, and metals unlock preferential tariff access to Canada, Mexico, and Japan.
4. Key Specifications & Summary Table
| Customs Code & Regime | Vietnamese Customs Term | Import Duty & VAT Treatment | Key Foreign Supplier Requirement |
|---|---|---|---|
| Code E21 (Toll Mfg) | Nhập nguyên liệu Gia công | Duty & Import VAT Suspended | Exact match to Gia công Contract & BOM Norm |
| Code E31 (Export Mfg) | Nhập nguyên liệu SXXK | Duty & Import VAT Exempt | Exact Net Weight & Unit Match for Form 15 Audit |
| On-Site EPE (E31 / B11) | Xuất nhập khẩu tại chỗ (DNCX) | Duty/VAT Exempt inside EPE Zone | Tri-party Invoice, Delivery Note & Customs Sync |
| Code A12 (Domestic Prod) | Nhập kinh doanh sản xuất | MFN Duty (or FTA Relief) + VAT | Valid FTA C/O (Form AK, E, D, CPTPP, EUR.1) |
5. Frequently Asked Questions
Q1. How do Vietnamese export factories import raw materials duty-free under E21 and E31 customs codes?
Vietnamese factories manufacturing goods for export declare imported raw materials under Customs Code E21 (for toll manufacturing / Gia công) or Code E31 (for export production / Sản xuất xuất khẩu — SXXK). Both regimes exempt imported yarns, fabrics, resins, chemicals, or metals from import duties and import VAT, provided the resulting finished goods are exported and reconciled annually.
Q2. Why do Vietnamese factories demand strict material consumption accuracy for their annual Form 15 report?
Factories using E21/E31 duty-free imports must file Form 15/BCQT-NVL/GSQL every year reconciling Beginning Inventory + Imports − Exported BOM Consumption = Ending Inventory. Any weight or unit discrepancy on a foreign supplier's Packing List exposes the factory to post-clearance customs audits and retroactive tax assessments.
Q3. How can a South Korean or European fabric mill get nominated by Vietnamese garment exporters under EVFTA?
Fabrics originating in South Korea or the EU qualify for EVFTA extended cumulation when cut and sewn in Vietnam. By supplying valid origin declarations alongside accurate roll-by-roll packing lists aligned with Form 15 reconciliation, foreign textile mills become preferred suppliers for Vietnamese garment exporters serving European brands.