Moves taken to protect local carmakers

#New & Updates

Deputy Prime Minister Trinh Dinh Dung has asked the Ministry of Industry and Trade (MoIT) and relevant agencies to study the possibility of applying safeguards to protect the domestic automobile manufacturing industry from looming zero-tariff car imports.

The move is also intended to boost the development of allied industries for the domestic automobile industry as it copes with a persistent low rate of local content and high production costs.

Moves-taken-to-protect-local-carmakersAssembling automobiles in Ford Vietnam factory__Photo: Tran Viet/VNA

In a recent document sent to the MoIT, Dung asked the ministry to propose to Prime Minister Nguyen Xuan Phuc revisions of policies and mechanism to boost the allied industries, especially for big investors and leading automakers.

He said a multi-sector working team should be set up to undertake a comprehensive evaluation of the domestic automobile market in correlation with regional and global markets

The evaluation must focus on opportunities and difficulties ahead of 2018, when import duty on complete built-up units (CBUs) from ASEAN countries will be completely abolished. It should also provide a forecast of supply and demand in the country and the region, and an assessment of the capacity and development potential of local auto production, as well as domestic automakers’ ability to adapt to fierce competition given Vietnam’s commitment to ASEAN to open its automobile market.

The Deputy PM also assigned the Finance Ministry to work with relevant agencies to tighten the management of tariff value and origin of CBUs, which should meet the ASEAN’s criteria of origin, in order to ensure the proper implementation of tax regulations and international commitments.

The ministry was also tasked to revaluate the excise tax rate and registration fee on pick-ups, which then would be submitted to the Government and the National Assembly for revision.

According to the document, the ministry will have to check and study MFN (Most Favored Nation) tariffs on components and auto parts for revision, if needed, commensurate with the Government’s orientation on promoting domestic auto part production.

It will join the Ministry of Transport and Ministry of Science and Technology in designing technical barriers appropriate to domestic regulations and international commitments to ensure no inferior-quality automobiles are imported into Vietnam. They should also protect the rights and interests of consumers and local automakers, simplify procedures, and create favorable conditions for automakers’ operation.

Source: Vietnam Law & Legal Forum (


Hanoi Office:

  • 10th Floor, Pacific Place Building, 83B Ly Thuong Kiet Street, Hoan Kiem District, Hanoi, Vietnam
  • T: (+84) 24 3946 1063
  • F: (+84) 24 3946 1025

Ho Chi Minh City Office:

  • 8th Floor, 135 Pasteur Street, Ward 6, District 3, Ho Chi Minh City, Vietnam
  • T: (+84) 28 3016 6768
  • F: (+84) 28 3822 5569

Hong Kong Office:

  • MGDP Pharma Research & Marketing Company Limited
  • 2303-7 Dominion Centre, 43-59 Queen's Road East, Hong Kong
  • T: (+852) 3416 1711
  • F: (+852) 2529 5035