The case of 100 containers of cashew nuts exported to Italy being defrauded has not yet subsided, but recently, 5 shipments of pepper, cinnamon, cashews and star anise... worth more than 500,000 USD exported to Dubai, United Arab Emirates by Vietnamese enterprises are suspected of being defrauded and are at risk of being lost.
This is not a new story in international trade, especially export activities, but these tricks are becoming increasingly sophisticated and causing consequences for export businesses.
So what is the cause of this story, why do export enterprises continuously fall into fraud traps and what measures can be taken to ensure the legitimate rights and interests of Vietnamese enterprises in international trade transactions?
Associate Professor, Dr. Ta Van Loi, Director of the Institute of International Trade and Economics, National Economics University, had an interview with the press on this issue.
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| Associate Professor, Dr. Ta Van Loi, Director of the Institute of International Trade and Economics, National Economics University. (Source: VNE) |
Based on the developments of the case of some Vietnamese agricultural products and spices exported to the United Arab Emirates (UAE) being suspected of being fraudulent, what is your opinion on this issue?
Partners in the United Arab Emirates who bought agricultural products and spices were completely scammed because Vietnamese businesses were weak in import-export business operations and were lured by foreign partners.
Normally, partners often have two ways of tightening obligations and rights. One is that they tighten by contract, giving very unfavorable terms for Vietnamese enterprises. Two is that they are proficient in business and will tighten by professional skills. The contract is very sketchy, even signing a performa invoice (pro forma invoice) without arbitration or complaint clauses, then when they know the time of risk for the partner, they will tighten or find ways to avoid payment obligations. The development of the above case is that they tighten in the second way.
Sir, in reality, many businesses have taken risks when working with foreign partners. What do you think is the cause of this situation?
Risks in import-export business involve subjects from sellers, buyers, banks and other organizations. When a party intends to commit fraud, there are often initial proactive scenarios and unusual signs that are different from normal trading practices.
Vietnamese enterprises are mostly small and medium-sized enterprises with little budget to hire consultants or recruit personnel with formal training in both economic and legal skills, so they are often "lured" into their traps by foreign partners.
Furthermore, import-export business often has risks related to 3 flows of goods and services, information flow and financial flow. The cause is still human, the subject participating in the purchase and sale transactions with fraudulent intentions. The tricks are increasingly sophisticated and become professional fraud. But on the contrary, it is Vietnamese enterprises that are weak in their expertise that have risks.
On the other hand, the recent decline in the international market has put psychological pressure on Vietnamese businesses that want to sell goods to maintain business, making them more vulnerable to being taken advantage of.
So, in your opinion, in this case or similar cases, what should businesses do to get their money and goods back?
To get money and goods in similar cases, I think the following steps are needed.
Firstly, businesses need to proactively update their knowledge, skills and import-export business operations.
Second, if you are not sure, you need to consult experts, even trade consultants at embassies, lawyers or economic experts at universities, departments and agencies will provide advice and support.
Usually there are the following services to support: Contract drafting, legal advice; business advice and implementation procedures with both the exporting and importing parties.
So, in your opinion, what are the factors that businesses need to master to avoid risks when entering into contracts with foreign partners in the international trade "playground" and what signs can "spot" and identify fraudulent tricks in transactions?
Enterprises need to master the knowledge and business of import and export, otherwise they need support from experts; need to review legal traps and business traps in international business transactions.
Businesses need to consult on risk prevention operations regarding goods, payments, and information such as information verification operations, information checking operations, and identifying abnormalities in transactions and payments.
Specifically, partners need to verify logic, verify headquarters, account information, and choose to use four basic payment methods from cash, collection, money transfer or letter of credit.
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