VI From 5 September 2026, regulations governing the transit trade of goods by foreign-invested economic organizations (FDI enterprises) have undergone a notable change. While Article 18 of Decree 69/2018/ND-CP prohibited these entities from conducting transit trade activities, Article 19 of Decree 292/2026/ND-CP introduces a new framework permitting such activities, provided that goods are transported directly from the exporting country to the importing country without passing through any Vietnamese border gate.
1. Conditions for FDI Enterprises to Conduct Transit Trade Activities
Transit trade refers to the purchase of goods from one country or territory for resale to another country or territory without carrying out import procedures into Vietnam or export procedures out of Vietnam. This activity is governed by foreign trade management regulations and is also subject to relevant provisions on investment, taxation, and foreign exchange management.
Previously, under Clause 2, Article 18 of Decree 69/2018/ND-CP, foreign-invested economic organizations were not permitted to conduct transit trade activities. However, effective from 5 September 2026, Article 19 of Decree 292/2026/ND-CP establishes a new regulatory approach. Accordingly, foreign-invested economic organizations are permitted to conduct transit trade, but only where goods are transported directly from the exporting country to the importing country without passing through any Vietnamese border gate.
Furthermore, the transit-traded goods must be consistent with the registered business lines of the enterprise or the contents of its Investment Registration Certificate (IRC), where the enterprise is subject to the IRC issuance requirement.
In addition, enterprises should note that goods intended for transit trade must not fall within the List of Goods Subject to Temporary Suspension of Temporary Import for Re-export and Transit Trade, as promulgated by the Minister of Industry and Trade. This list is established to prevent environmental pollution, epidemics, risks to human health and life, illegal transshipment, and potential commercial fraud. The list may be updated depending on the prevailing circumstances and requirements of the country.
Accordingly, although FDI enterprises are not required to obtain a separate transit trade business licence, they must ensure that the goods traded under this arrangement are consistent with their registered business lines and do not fall within the list of goods restricted from transit trade as published by the Ministry of Industry and Trade at the time of conducting the relevant transactions.
2. Tax Obligations of FDI Enterprises Engaging in Transit Trade
The fact that goods are not imported into Vietnam does not necessarily mean that an enterprise is exempt from all tax obligations. The applicable tax treatment must be determined based on the nature of the transaction, the place of delivery and receipt of goods, the accounting method adopted, and the tax regulations in force at the time the relevant obligations arise.
Export and Import Duties: In a genuine transit trade transaction, goods are transported directly between two countries outside Vietnam without undergoing export or import customs procedures in Vietnam. Accordingly, Vietnamese export and import duties generally do not arise in respect of such goods. This conclusion should, however, be reassessed if the goods actually pass through Vietnamese territory or are subject to other customs procedures in Vietnam.
Value-Added Tax (VAT): Transit-traded goods fall within the category of goods not subject to VAT under Vietnam’s VAT regulations. Nevertheless, enterprises must distinguish between the purchase and sale of transit-traded goods and ancillary services arising in Vietnam, such as brokerage, transportation, warehousing, or consultancy services. Such services must be separately assessed under the applicable VAT regulations and are not automatically entitled to the same tax treatment as the transit-traded goods themselves.
In addition, enterprises should note that they are still required to properly fulfil their VAT declaration obligations in respect of transit-traded goods, with the applicable VAT rate indicated as “not subject to VAT”.
Corporate Income Tax (CIT): FDI enterprises established and operating in Vietnam remain subject to CIT obligations in respect of taxable income generated from their transit trade activities in accordance with applicable CIT regulations. The fact that goods do not enter Vietnam does not mean that profits derived from the enterprise’s business activities in Vietnam are exempt from taxation. Enterprises must maintain proper records of revenue, cost of goods sold, deductible expenses, and other relevant income items to determine their CIT liabilities.
Furthermore, enterprises should review their tax obligations arising from ancillary transactions and cross-border payments, where applicable. The determination of tax liabilities should be based on the relevant contracts, delivery and receipt documents, invoices, accounting records, and corresponding sector-specific regulations.
3. Payment and Fund Transfer Principles under Circular 43/2026/TT-NHNN
Effective from 5 September 2026, Circular 43/2026/TT-NHNN stipulates the principles governing payments and fund transfers related to the transit trade of goods. Under Article 3, enterprises are required to comply with four key principles.
First, payments and fund transfers must be based on two separate transactions corresponding to the purchase contract and the sale contract, namely: the outward remittance to settle the purchase price of goods and the receipt of proceeds from the sale contract.
Second, the outward remittance for payment of the purchase price may be made either before or after the enterprise receives payment under the sale contract. This provision provides flexibility in payment timing while maintaining the requirement for enterprises to substantiate and monitor the cash flows associated with each transit trade transaction.
Third, all payments and fund transfers relating to transit trade activities must be conducted through an authorized bank licensed to conduct foreign exchange business and provide foreign exchange services.
Fourth, payments and fund transfers relating to the same transit trade transaction must be conducted through the same authorized bank, based on the purchase contract and sale contract for the relevant goods. Where such bank is not permitted to conduct international payments or fund transfers under applicable laws, the enterprise may carry out the transactions through another authorized bank.
These principles require enterprises to maintain consistent contractual records and payment documentation to enable banks to reconcile outgoing payments against incoming proceeds. Enterprises must also comply with the documentation and information provision requirements prescribed under the Circular.
4. Assessment and Recommendations for FDI Enterprises
The introduction of Article 19 of Decree 292/2026/ND-CP, which permits foreign-invested economic organizations to conduct transit trade through direct transportation of goods between the exporting and importing countries, represents a significant change compared with the prohibition previously imposed under Decree 69/2018/ND-CP. The new regulation expands the opportunities for FDI enterprises to participate in international trade activities while maintaining restrictions on the transportation of transit-traded goods through Vietnamese border gates.
Nevertheless, the practical implementation of this activity depends on whether enterprises satisfy the requirements concerning their registered business lines or the contents of their IRC, comply with applicable licensing requirements for regulated goods, and adhere to the prescribed payment and fund transfer principles.
To mitigate potential legal risks, enterprises are advised to review their registered business scope before entering into relevant contracts; clearly determine the transportation routes and places of delivery and receipt of goods; separately maintain purchase contracts, sale contracts, and transportation documents; and coordinate with authorized banks to ensure that payment documentation is consistent and cash flows are properly monitored.
From a tax perspective, enterprises should independently assess their obligations under each applicable tax category based on the actual transaction structure, rather than automatically assuming that transit-traded goods are exempt from all tax obligations in Vietnam.
