On-spot import and export is a customs mechanism in which goods never physically leave Vietnam yet are treated as exported/imported for customs purposes: a Vietnamese seller delivers goods to a Vietnamese buyer as designated by a foreign trader. It is a powerful supply-chain tool for FDI enterprises — qualifying for the 0% VAT rate while cutting logistics time and cost.
This guide explains the three on-spot scenarios, the customs procedures, the applicable tax treatment, and the legal trap that costs many enterprises their tax benefits.
1. The three on-spot scenarios
Under Article 86(1) of Circular 38/2015/TT-BTC (amended by Clause 58, Article 1 of Circular 39/2018/TT-BTC), on-spot import/export applies to three cases:
- Case 1: goods sold by a Vietnamese enterprise to a foreign trader but delivered to another enterprise in Vietnam as designated (for processing or trading);
- Case 2: goods traded between a domestic enterprise and an export-processing enterprise (EPE);
- Case 3: goods traded between a Vietnamese trader and a foreign trader with a presence in Vietnam (branch, representative office) — see the trap in section 4.
The common thread: a foreign trader participates in the sale relationship, and the goods are delivered within Vietnam without going through border-gate import/export procedures.
2. Customs procedures: 15 working days and codes #&XKTC / #&NKTC
Under Article 86(4), the on-spot exporter and on-spot importer must complete customs procedures within 15 working days from the date of clearance or release of the goods (for on-spot exports) — declarations filed late lose eligibility for the on-spot regime.
Under Article 86(5), declarations use special customs codes: #&XKTC (on-spot export) for the seller’s declaration and #&NKTC (on-spot import) for the buyer’s declaration. The two declarations are cross-matched in the customs system — mismatched information between the two parties is a common reason files get stuck.
3. Tax treatment: 0% VAT and duty-free imports from EPEs
For VAT, on-spot exported goods qualify for the 0% rate under VAT Law No. 48/2024/QH15 (amended by Law 90/2025/QH15, applicable from 1 July 2025) — provided the dossier includes the on-spot export declaration, the sale contract, and bank payment evidence.
For import duty, on-spot imports from export-processing enterprises are exempt under Article 12 of Decree 134/2016/ND-CP (customs code E31 for materials imported for export production). This is a critical link in FDI supply chains: an EPE sells components to a domestic enterprise for processing/assembly and subsequent export.
4. The biggest trap: foreign traders with a presence in Vietnam
This is what customs and auditors scrutinize most closely. If the foreign trader already has a commercial presence in Vietnam (a branch, representative office, or subsidiary) and directly participates in the transaction, the sale may be recharacterized as an ordinary domestic sale — not on-spot import/export.
The consequences: loss of the 0% VAT rate (8% or 10% applies instead, with back-tax on the difference) and possible administrative penalties for misdeclared customs codes. Before structuring a transaction, verify the foreign counterparty’s legal status in Vietnam and seek advice on whether the deal qualifies under Article 86.
5. Watch out: the amended Customs Law takes effect 1 March 2027
Law No. 11/2026/QH16 amending the Customs Law takes effect on 1 March 2027, aimed at cutting procedures and digitizing customs. Enterprises using on-spot import/export should follow the implementing guidance to update declaration procedures, deadlines, and reporting. During the transition, Article 86 of Circular 38/2015 (as amended by Circular 39/2018) continues to apply in full.
On-spot checklist
- Confirm the transaction falls into one of the three cases under Article 86(1).
- Verify the foreign counterparty has no commercial presence in Vietnam (avoid the section-4 trap).
- Sign a sale contract clearly showing the designated in-Vietnam delivery.
- File #&XKTC / #&NKTC declarations within 15 working days; ensure both parties’ data match.
- Keep the full dossier for 0% VAT: declarations, contract, bank payment evidence.
- For imports from EPEs: use code E31 and track duty-exemption conditions.
Legal references
- Circular 38/2015/TT-BTC — Article 86, amended by Clause 58, Article 1 of Circular 39/2018/TT-BTC (on-spot procedures).
- VAT Law No. 48/2024/QH15, amended by Law 90/2025/QH15 (0% rate, from 1 July 2025).
- Decree 134/2016/ND-CP — Article 12 (import-duty exemption for on-spot imports from EPEs).
- Law 11/2026/QH16 amending the Customs Law (effective 1 March 2027) — follow implementing guidance.
This article is for general information only and does not replace legal advice for specific transactions. On-spot import/export rules may be further detailed in guidance; enterprises should check the latest instruments and consult professionals before acting.
Contact FLAT Law Firm: if your company needs a review of on-spot transaction structures, help with 0%-rate issues, or support in customs disputes, our team is ready to assist. See more articles on foreign investment on flaw.vn.
This article was prepared by the FLAW AI Legal Council, has passed internal QA review, and is pending owner approval. It is not the opinion of a licensed human lawyer and does not replace direct legal advice.
