x Private, businesses, organizations are participating in import and export activities and need to learn about the term De Minimis?
X You want to know what the De Minimis rule in free trade agreements stipulates what?
X and you wonder when the business should apply the De Minimis rule? Does De Minimis affect import -export enterprises?
Join Proship.vn we learn about the term De Minimis? De Minimis in free trade agreements stipulates what? When businesses should apply the De Minimis rule and the effects that businesses may encounter from De Minimis. Through this, you also know if De Minimis has any special situation or not.
What is de minimis: Definition, legal regulations
The following content will answer what the term de minimis is and current legal provisions related to de minimis:
What is De Minimis?
De Minimis is a Latin phrase (De Minimis Non Curat Lex), meaning "the law does not care about the small thing". In the rule of origin, De Minimis allows a small percentage of non -origin materials (not meeting the rules of origin) that is "ignored" without affecting the entire origin of the goods.
The value of De Minimis benefits e -commerce/business orders to consumers (B2C) because they are often low in value, so they will not be taxed or fees.
In other areas, De Minimis is used in many other legal fields, such as competition laws, where it refers to the low level of an act that is not considered a violation.
Legal regulations
De Minimis is not a general concept but is clearly defined in the typical free trade agreements (FTA) such as:
- ATIGA Agreement (Form D);
- EVFTA Agreement (Form EUR.1);
- CPTPP Agreement (Form CPTPP);
- And other FTAs.
Regulations under the comprehensive economic partnership agreement on De Minimis
Pursuant to Article 11 of Circular 05/2022/TT-BCT stipulating de minimis as follows:
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- With the goods belonging to Chapter 01 to Chapter 97 of the descriptive harmonious system and commodity encryption, the value of all raw materials without origin to produce goods and does not meet the criteria for conversion of goods does not exceed 10% of the FOB value of that goods. The value of raw materials does not have origin is calculated according to Clause 3, Article 8 of this Circular.
- With the goods under Chapter 50 to Chapter 63 of the description of the harmonious system and commodity encryption, the weight of all raw materials is not originating to produce goods and does not meet the criteria for converting goods codes not exceeding 10% of the total weight of the goods.
(2) The value of raw materials without origin as prescribed in Clause 1, Article 11 of Circular 05/2022/TT-BCT is calculated as the value of raw materials without origin when applying the formula for calculating regional value.
De Minimis in some free trade agreements (FTA) and special De Minimis rules
The following content will discuss what the De Minimis rule is in the free trade agreements (FTA) and special De Minimis rules:
De Minimis in free trade agreements
* ATIGA - ASEAN Agreement:
De Minimis in ATIGA - ASEAN Agreement:
- DE Minimis level: maximum 10% of FOB value;
- Flexible application in CTH and CTSH;
- Do not use to "spleen" the RVC regulations.
* CPTPP Agreement:
De Minimis in the CPTPP Agreement:
- DE Minimis level: up to 10% of the value of goods;
- Request detailed declaration in the documents proving the origin;
- Special attention should be noted for sensitive goods.
* EVFTA Agreement:
De Minimis in the EVFTA Agreement:
- Clear and detailed about de minimis;
- Some industries such as textiles and footwear have their own instructions;
- There are regulations to eliminate de minimis for some products.
Each FTA has a different interpretation of De Minimis, should not apply "simultaneously" but need to read the corresponding text and circular.
Special De Minimis rules
There are cases for some countries where the De Minimis rule is not as simple as other countries. The United States, for example, is simple when it comes to de Minimis.
The US De Minimis threshold is particularly generous at $ 800, allowing tax exemption and duty exemption below this threshold. In contrast, countries like Australia and Russia have unique rules that increase the complexity of De Minimis concept.
When does the business apply De Minimis rule? What is the influence of the De Minimis rule
To answer the question, when the business applies the De Minimis rule and the influence of this rule on the business, let's read the following content:
When does the business apply De Minimis rule?
To "activate" the De Minimis rule, businesses need to meet the following conditions:
- The main goods meet the rules of origin according to CTH, CTSH, RVC, ...;
- Raw materials are not originated below the De Minimis threshold;
- Not in the exclusion list (specified in each FTA).
The influence of De Minimis on the business
If you are running an international e -commerce business, minimum threshold and valuation rules should be considered in the business strategy.
As a business, there are important questions to note that the minimum use and whether you are eligible for customs clearance around the world:
- Do your business goods achieve the threshold?
- Do you know the rules and thresholds where the shipment is?
- Do you know the value of your product?
The above allows maximizing sales opportunities because you can consider low value thresholds when pricing products and shipping fees. Song De Minimis is not a means of spleen to avoid taxes and obligations.
Proship Logistics has clarified what the term De Minimis is in import and export, the effect of what De Minimis rule is, De Minimis in FTA agreements stipulates what, ... From here businesses can apply this rule to international commodity trade. Contact 0909 344 247 to receive direct advice on FCL/LCL transportation solutions to international multimodal cheap methods.
