Rules needed for origin labels

The Ministry of Industry and Trade’s Import – Export Department had recently warned about the increase in trade fraud through labeling products as ‘Made in Viet Nam’. The labeling of products as ‘Made in Viet Nam’ aimed to benefit from free trade agreements to which the country is a member and to avoid trade defense mechanisms by importing countries.

Most recently, the Ministry of Industry and Trade urged supervision to be enhanced on certificates of origin for Vietnamese electric bikes over worries about fraud after Viet Nam’s electric bike exports to the European Union increased sharply coinciding with the European Commission’s imposition of anti-dumping duties on products from China.

The department said that origin fraud would not only negatively affect the products and the local industry but also undermine the competitiveness of made-in-Viet Nam products. It added that a number of traders remained unaware of the impact of origin fraud on the country’s production.

Viet Nam does not have regulations on labeling products as ‘Made in Viet Nam’, thus, consumers did not know whether the products were truly made in Viet Nam or not.

The Ministry of Industry and Trade said that it was pressing to develop regulations on labeling, in which products must meet certain criteria.

The ministry said that many countries had detailed regulations about labeling their products such as Switzerland’s regulations for watches, the US’ for automobiles and garment products and New Zealand’s for wine.

The criteria could be developed for labeling products as ‘Made in …’, ‘produced in…’, ‘designed by/in…’, ‘assembled in…’, ‘processed in…’, ‘packaged in…’ or ‘imported by/for…’.

Many countries impose heavy punishments for violations. For example, producers who labeled ‘Made in Italy’ for leather products which did not meet established criteria could be fined up to 100,000 euros (US$113,000). In Canada, any violations which caused misunderstanding about products could be fined up to $15 million or even imprisonment from one to 14 years.

According to the Ministry of Industry and Trade, the labeling would first be on a voluntary basis, adding that producers must be able to prove that the products met the established criteria when required. Later, the labeling could be compulsory for several products.