Inside the LEGO and ExtendMax partnership for a billion-dollar factory

The LEGO Group is set to inaugurate its most advanced and largest factory globally, with an investment of approximately USD 1.4 billion in Binh Duong, Vietnam. This strategic move aims to meet the growing demand in the Asian market and bolster the company's sustainable development goals. However, during the initial stages, LEGO faced significant challenges concerning the importation of information technology (IT) equipment, especially devices related to civil cryptography, cybersecurity, and wireless communication. To navigate these legal complexities, LEGO partnered with ExtendMax, a leading consultancy in import-export and regulatory compliance.

LEGO Vietnam Factory Project Overview

In late 2022, LEGO planned to commence construction of its state-of-the-art factory in Binh Duong, Vietnam. This facility, representing the company's largest global investment, is designed to cater to the increasing demands of the Asian market and to further LEGO's commitment to sustainable development. Early in the project, LEGO encountered substantial challenges related to the importation of IT equipment, particularly devices involving civil cryptography, cybersecurity, and wireless communication functions. To address these legal hurdles, LEGO entrusted ExtendMax to provide comprehensive solutions.

Objectives of the Collaboration with ExtendMax

The LEGO project in Vietnam, with a total investment of USD 1.4 billion, stands as one of the company's flagship initiatives globally. LEGO sought ExtendMax's expertise to devise strategies and assist in importing all necessary IT and control equipment for the Binh Duong factory. The total value of the IT equipment required for the project amounts to tens of millions of USD.

Key Challenges and Obstacles

From the outset, LEGO's team faced several significant challenges:

• Legal Requirements: Vietnamese regulations mandate that enterprises wishing to import devices with encryption capabilities or wireless communication functions must meet stringent conditions outlined in the Law on Cybersecurity.

• Legal Standing: As a newly established legal entity in Vietnam with a nascent team, LEGO did not yet meet the legal prerequisites to obtain import licenses for civil cryptographic products, which are crucial IT devices for the project.

• Resource Constraints: In its initial phase, LEGO's Vietnam team lacked sufficient personnel and experience in evaluating and classifying IT equipment, as well as in handling import-export procedures for specialized IT devices.

• Project Timeline: Delays in importing these IT devices could severely impact the overall project schedule.

ExtendMax's Comprehensive Solution

Leveraging its extensive experience and reputation in import-export consultancy, ExtendMax was selected as LEGO's strategic partner to provide importer of record services and comprehensive import-export consultancy for the project. The solutions implemented by ExtendMax included:

Legal Analysis and Classification:

ExtendMax categorized all IT equipment slated for import, identifying the necessary licenses and certifications. The equipment was divided into two main groups:

• Group 1: Devices that LEGO could legally import directly, optimizing cost efficiency.
• Group 2: IT devices requiring specialized licenses that LEGO was not yet qualified to obtain, necessitating importation through ExtendMax's importer of record services.

ExtendMax advised LEGO on the procedures for obtaining civil cryptography license, cybersecurity license, and type approval certificates, establishing timelines to meet the project's tight schedule.

Preparation and Completion of Legal Documentation:

ExtendMax assisted LEGO in preparing all necessary documentation related to the import procedures for IT equipment shipments. We also submitted the applications on LEGO's behalf and worked directly with regulatory authorities to complete the procedures and obtain the required licenses and certifications for the import process.

Acting as Importer of Record on behalf of LEGO:

ExtendMax served as the legal importer of record on behalf of LEGO, completing customs procedures, tax declarations, and related formalities for multiple consignments of IT equipment. All IT devices requiring specialized licenses, including those for civil cryptography, were successfully imported into Vietnam by ExtendMax, ensuring adherence to the project's stringent timeline.

Ongoing Support and Issue Resolution:

Throughout the importation process, ExtendMax closely monitored customs clearance progress and collaborated with LEGO teams in Denmark and Vietnam to promptly address any arising issues. ExtendMax also provided guidance on post-import legal procedures and advised on requirements for future supplementary imports.

Outstanding Results

Thanks to ExtendMax's professional and comprehensive support, LEGO successfully imported the critical IT equipment for its Vietnam factory without encountering any risks or delays. This achievement was pivotal in ensuring the timely construction and operation of the USD 1.4 billion facility.

The project established a solid foundation for LEGO in Vietnam, facilitating manufacturing and business activities in the region, and underscoring the company's commitment to sustainable development and environmental stewardship. This success also reaffirms ExtendMax's position as a trusted partner in entrusted import-export services and regulatory consultancy in Vietnam.

The LEGO factory project in Vietnam exemplifies ExtendMax's exceptional capabilities in customs procedures consultancy, import-export services, and entrusted importation for leading global technology and manufacturing corporations. ExtendMax remains committed to continuous innovation, supporting businesses in overcoming legal challenges, and promoting sustainable development and success in the Vietnamese market.