Ministry says will relax rice export regulations

Ministry says will relax rice export regulations

Lan Nhi

Numerous unreasonable regulations on rice storage and export contract registration will be abolished – PHOTO: TL

HANOI – The Ministry of Industry and Trade is seeking to abolish many regulations on rice export activities to make rice trade easier for exporters. At the same time, the ministry will narrow down the exclusive right of the Vietnam Food Association (VFA).

The ministry has completed collecting opinions of relevant agencies about a draft Government decree which will replace Decree 109/2010/ND-CP of the Government on rice export business.

Accordingly, most barriers in the rice trade will be removed, especially those excluding small traders from the competitionThese include quantitative restrictions such as a regulation that a rice trader must have at least a warehouse able to store at least 5,000 tons of rice, and at least a rice mill with a capacity of at least 10 tons of rice an hour. The warehouses and milling facilities must be located in provinces or cities from which rice is exported.

vate Enterprise in Dong Thap Province and Vien Phu Trade and Production JSC in Ca Mau Province.The ministry will also eliminate the requirement for locations of warehouses and mills as it creates difficulties for localities and traders in rice export and shows the administrative intervention in an enterprise’s decision-making process.

Enterprises also found procedures for registration of rice export contracts complicated. Shortcomings of the VFA during the registration of export contracts make enterprises anxious about their business information being leaked, so the regulation on rice export contract registration with the VFA should be scrapped.

The rule on the floor export price of rice will likely be removed as well because rice prices change unpredictably.

The ministry has also amended and supplemented several regulations to facilitate rice export activities such as the abolition of procedures for inspecting traders in meeting business conditions. Instead, traders will provide information and take responsibility for their claim of meeting business conditions.

The role of VFA will also be narrowed down. According to the current decree, only VFA has the right to decide on rice export under government-to-government (G2G) contracts and distribute benefits to its member enterprises. The regulation may create unfair advantages for other export companies.

Therefore, the ministry has limited the managerial responsibilities of VFA so that the association can distribute 80% of G2G contracts in line with regulations stated in the decree.

The ministry said new regulations on rice export activities will make life easier for traders and reduce market entry costs so that traders can improve their business competitiveness and product quality to boost consumption.

Vietnam currently has 140 rice exporting firms. In 2016, the country shipped rice to 150 countries and territories.

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