As Vietnam Tightens Import Controls, Importer of Record Services Gain Importance

Importer of Record (IOR) plays a critical role in enabling foreign businesses to import goods into Vietnam in compliance with local customs and regulatory requirements. It takes full responsibility for each shipment’s customs, tax, and regulatory obligations and helps the company enter Vietnam in a compliant and structured manner.

Importer of Record (IOR) services have become increasingly important for foreign businesses entering Vietnam. As the country continues to strengthen its customs regulatory landscape through product labeling requirements, sector-specific import regulations, and other compliance measures, foreign businesses are expected to navigate such a complex import environment.

For companies that prefer to focus on their core business operations rather than developing in-house expertise, an IOR can provide an efficient and compliant market-entry solution.

What is an Importer of Record?

An Importer of Record (IOR) is a legal entity that assumes legal responsibility for ensuring that an imported shipment complies with the destination country’s customs regulations and legal requirements.

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Facilitating seamless market entry and global expansion

On behalf of the overseas seller, an IOR will conduct:

• product classification,
• evaluation of import requirements and related costs,
• preparation and submission of customs declarations,
• obtaining required licenses and permits, payment of duties and taxes, and
• ensuring compliance with labeling and regulatory requirements.

Depending on the arrangement, an IOR can also support product registrations and post-import record management.

How does IOR support market entry in Vietnam?

Enabling sustainable cross-border market expansion

For foreign companies exploring opportunities in Vietnam, establishing a legal entity may not always be an option. Businesses may wish to conduct preliminary market assessments or test products on a limited basis before making a long-term commitment.

However, without a legally established entity in Vietnam, foreign businesses cannot act directly as importers for customs purposes. Under Vietnam’s 2017 Law on Foreign Trade Management, imported goods must be declared by either a Vietnamese trader or a foreign trader with a legally established presence in Vietnam.

In this context, an IOR serves as the entrusted importer, enabling foreign businesses to import goods into Vietnam while ensuring compliance with customs clearance, regulatory requirements, and legal obligations. As such, the IOR’s role falls beyond facilitating logistics. It acts as the recognized importer and assumes all legal responsibility for importing goods before the Vietnamese authorities.

Accelerating market entry during the incorporation phase

Even when a company decides to establish a permanent presence, regulatory timelines do not always align with the execution plan. Especially during the incorporation stage, businesses may need to import equipment or products to prepare for market launch or to fully commence operations.

Products subject to specialized regulations, such as information technology equipment, telecommunications devices, medical devices, and other controlled products, often require additional approvals before importation.

An experienced IOR can help apply for the required permit and facilitate compliant imports on behalf of companies, allowing progress without unnecessary delays.

Key considerations when engaging an IOR

While an IOR can provide substantial benefits, businesses should carefully evaluate both the legal and operational aspects of the arrangement.

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• Businesses should execute and keep a record of the Entrusted Import Service Contract when engaging the IOR service. This agreement establishes the legal basis required by customs authorities to verify the purpose of the import and the ownership of the goods. Without this agreement, shipments may face customs clearance difficulties or become subject to additional scrutiny during customs audits and post-clearance inspections.
• Businesses should also conduct thorough due diligence when selecting an IOR partner. Factors such as customs expertise, experience with regulated products, regulatory compliance history, licensing capabilities, and operational coverage should all be considered to ensure reliability once engaged with the service.

Conclusion

As global trade becomes increasingly complex, Vietnam’s import control regime is evolving through revisions to de minimis rules to restrict the inflow of low-quality products and through enhanced labeling requirements to improve product traceability.

In some countries, such as the United States, regulatory attention is also placing greater scrutiny on IOR, emphasizing importer accountability and compliance responsibilities. While Vietnam has not yet adopted this tactic, this trend highlights the growing importance of selecting a qualified and reliable IOR.

Businesses should ensure that their chosen IOR possesses the necessary expertise, compliance capabilities, and local knowledge to effectively manage import obligations in Vietnam.

See also: Vietnam’s New Customs Penalty Decree: Key Compliance Changes for Importers and Exporters

Managing tax in Vietnam is critical for FDI companies to stay compliant with local regulations, GST requirements, and global standards such as IFRS, navigate complex filings, and apply correct tax treatments. A well-structured tax process helps to avoid penalties and stay 100% compliant.

Luy Doan

Assistant Manager, Tax

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