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Introduction
The
Chinese government exercises legal jurisdictions over the
foreign trade in the following aspects: goods moving across
the Chinese border, containers, packing materials for the
goods, and the transportation means; the persons engaged in
foreign trades including the consignor, the consignee, the
transportation company and the declaration agent; the flow of
funds arising from the cross-border settlement for trading in
goods.
Classifications
of commodities
The administrative supervision
over the goods moving across the Chinese border can be
classified according to different legal definitions:
1. Goods are classified under the
prohibited, restricted, and freely traded
categories.
2. Goods are either
classified into electrical and electronic goods, or classified
into non electrical-and-electronic goods (the general goods).
3. Goods can be classified as state
trading goods or goods subject to designated trading, and
general goods according to the legal capacity of the foreign
traders.
4. Certain specific goods under
the joint supervision and control of the customs and the
administrative bodies other than the Ministry of
Commerce.
5. Goods can be classified as
general goods, bonded goods, goods exempted from duty and
internal taxes, goods subject to reduction in internal taxes,
and temporarily imported goods. We deal with them under the
topic of tariff measures in a separate article.
Goods of the prohibited
category
The MOC together with other ministries
drafts, revises and announces periodically the Catalogs for
Prohibited Goods and Restricted Goods. The MOC has so far
announced 5 batches of import goods belonging to the
prohibited category, and 2 batches of export goods belonging
to the prohibited category. Goods falling into the prohibited
categories also include the goods banned from importation
under the PRC Law for the Prevention of Environmental
Pollution by Solid Wates, the animals, plants and their
products under the PRC Law for the Quarantine of Animals and
Plants, the goods under the PRC Administration Law for
Pharmaceutical Products. In addition, the Chinese customs
imposes ban on import and export goods that infringe on IP
rights.
The consignee shall not waive its right to
claim the imported wastes that are banned from import, nor
shall they waive the right to goods that cause pollution to
the environment. In case that the shipment cannot be returned,
the Chinese customs or relevant governing administrative
departments shall supervision the destruction or proper
handling of the said goods. The consignee is required to bear
the costs of destruction or handling. If the information of
the consignee is incorrect, the carrier shall bear the
costs.
Goods of the
restricted category
Restricted goods are
subject to non-tariff measures of quotas and licensing
requirement. Quotas apply to goods that are subject to
quantity restrictions while licenses apply to goods that are
not subject to quantity restriction. Every year the Ministry
of Commerce announces the official ˇ§Catalogs of goods subject
to the administration of import and export licensesˇ¨
respectively that apply in the following year. In 2005,
imported goods for which import licenses are required under
the restrictive category include the following 3 categories
with 83 HS commodity coding under the 8-digit heading (5
categories with 123 HS commodity coding under the 8-digit
heading in 2004): chemicals subject to state supervision and
control, chemicals for drug-making, and halogenated
derivatives of acrylic hydrocarbons.
Goods subject to
export license under the ˇ§Catalog of goods subject to
administration of export licensesˇ¨ consist of some 47 classes,
subject to the export quota licensing, quota bidding, and
export license administration. In accordance with the ˇ§Catalog
of Goods Subject to Export Licensing Administered under
Multi-level Issuing Bodiesˇ¨, the Quota Lisensing Department of
the MOC, the Local Special Offices of the MOC, and the issuing
bodies at the provincial-level government (including the
municipalities directly under the State Council, the
provincial capitals, and cities with independent development
plans) issue the export license for goods under their
respective juridictions.
The importation of motor
vehicles and accessories required quota licenses. As from 1st
January 2005, the Chinese government has removed the quota
requirement for motor vehicles and accessories, and
reclassified these products from the restricted category into
freely traded category, to which the automatic import
licensing system applies.
Goods under the freely traded
category
Goods not included in those 2
categories are traded freely and are not listed specifically.
Goods under the freely traded category are not subject to any
administrative restrictions except that the importer needs to
comply with the automatic licensing requirement for purpose of
statistic compilation. The administrative body should issue
the import license to the applicant within a maximum of 10
days. As from 1st January 2005, the Department of mechanical
and electrical products of the MOC is vested with the
authority to issue the automatic import licenses for
automobile and accessories.
In applying for an automatic
import license, the importer should provide a completed import
license application form, the purchase contract, and a copy of
the business license showing the relevant scope of business
activities. Automatic import licenses are valid for 6 months.
In caset that the imported goods are not within the scope of
business of the consignee, the Chinese government shall not
issue the ˇ§automatic import licenseˇ¨. In the absence of such
licenses, the consignee cannot proceed with statutory
requirement for foreign exchange verification and the customs
do not release the goods.
Goods exempted from import
licensing
Samples, advertising materials,
equipment as capital contribution to foreign investment
enterprise, and temporarily imported goods are exempted from
the import license requirement.
Temporaritly imported
goods are exempted from import license after the Chinese
customs receives security deposit or approved guarantee equal
to the amount of import duty and taxes. The scope of
temporarily imported goods includes the materials and
equipment that are used in China for film shooting, sports
event, artistic performance, construction projects, academic
exchange, delivery of lectures and so on. However, the
organizer should separately obtain administrative approval for
the importation of wireless equipment, certificate of
quarantine for animals and plants, certificate of examination
for pharmaceutical products, and health inspection certificate
for foods.
The bonded goods imported under processing
agreements should be exported after undergoing processing in
China. Therefore, the provisions for import license
administration should not apply. If there arises any need for
the sale of those goods in the domestic market due to some
legitimate reasons, the importer need to apply to different
departments in the Ministry of Commerce for two licenses: one
from local office of the MOC for automatic import licenses for
those goods; the other from provincial-level MOC for the
ˇ§approval certificate for the sale of bonded goods in domestic
marketsˇ¨.
Goods of the restricted category shipped
between free trade zones (FTZ) and other countries (regions),
between export processing zones (EPZ) and other countries
(regions), are exempted from the licensing and quota
requirement. When goods are delivered between FTZ and non-FTZ
entities, between EPZ and non-EPZ entities within China, the
parties concerned are required to follow the quota and
licensing procedures for imports and exports.
The
exemption shall not apply to the following goods irrespective
of the mode they are imported: Chemicals for drug essence,
chemicals subject to administrative supervision and control,
ozone layer consuming substance.
Goods exempted from export
licensing
The following goods are exempted from
export licenses, except for Chemicals for drug essence,
chemicals subject to administrative supervision and control,
chemicals for chemical weapons, essence of chemical weapons,
basic ingredient for chemical weapons, substance that consumes
the ozone layer.
1. Exhibits imported
into China after being shipped out for
exhibitions;
2. Sample goods or goods for
experimental testing the value of which does not exceed
RMB30,000 for each batch;
3. Bulk cargoes
with less than 5% discharge or loading
margin;
4. Temporarily exported
goods;
5. Goods shipped between the free
trade zone and other countries, between the export processing
zones and other countries.
Mechanical and electronics
products
Import goods can also be divided into
electro-mechanical products, and non electro-mechanical
products. The latter is also considered to be general goods.
The scope of mechanical electronics products includes
machinery and equipment, electricity equipment, transport
equipment, electronics products, electrical products,
electrical instruments and tools, the parts and components.
Electro-mechanical products are classified into prohibited,
restricted and automatically imported category. According to
ˇ§Administrative Measures for the Importation of
Electro-mechanical Productsˇ¨, the MOC announces the catalogs
of the electro-mechanical products for the prohibited
category, the restricted category, and the automatic imported
category respectively.
Importation of the
electro-mechanical products belonging to the restricted
category will be subject to quota requirement if there is any
quantity restriction, and license requirement if there is
none. Products falling into automatic import category are
administered under an automatic import license
system.
The ˇ§Administrative measuresˇ¨ shall apply under
the following circumstances: (1) the goods or products are on
the lists for the electro-mechanical product catalogs; and (2)
these goods are imported for sales or for use in the
manufacture of goods to be sold in the Chinese domestic
market. Goods imported for own use by foreign investment
enterprises or for use in the manufacture of export goods
under import or contract processing arrangements fall outside
the scope of the Measures. |
