CIRCULAR OF THE GENERAL ADMINISTRATION OF CUSTOMS AND THE STATE ADMINISTRATION FOR ENTRY-EXIT INSPECTION AND QUARANTINE ON VERIFICATION AND CANCELLATION OF SAMPLE-CHECK COMMODITIES IN THE ” THREE INSPECTIONS” IN THE PROCESSING TRADE CONTRACTS

The General Administration of Customs, the State Administration for Entry-Exit Inspection and Quarantine

Circular of the General Administration of Customs and the State Administration for Entry-Exit Inspection and Quarantine on Verification
and Cancellation of Sample-check Commodities in the ” Three Inspections” in the Processing Trade Contracts

ShuShui [1999] No.590

August 18, 1999

Guangdong Branch, each customs directly under the General Administration of Customs and every bureau of inspection and quarantine
directly under the State Administration for Entry-Exit Inspection and Quarantine:

With regard to the recent question posed by the Harbin Customs to the General Administration of Customs on whether the receipt presented
after the sample commodity inspection, sanitation inspection and animal-plant inspection (hereinafter referred to as ” three inspections”)
of bonded goods for processing trade can be regarded as effective certificate for cancellation the processing trade contract at the
customs, the reply is confirmed as follows:

I.

After carrying out sample check of bonded raw materials, components or finished products for processing trade according relevant laws
and regulations, the “three inspections” departments shall present relevant certificate (see attached sample). The customs can verify
and cancel the goods with reasonable quantity upon the presentation of the certificate. New inspection and quarantine certificate
will replace the old “three inspections” certificate after reform on the “three inspections” institutions.

II.

“Reasonable quantity” in Article 1 refers to the quantity of samples taken by the “three inspections” department in accordance with
relevant laws and regulations.

III.

No “three inspections” department can randomly enlarge the scope and quantity of the sample-check. When checking bonded goods for
processing trade, the “three inspections” departments shall submit to the local customs for filing a report in advance, including
such contents as the sample-check scope, quantity and criteria. Customs shall report unjustifiable sample-check quantity notably
higher than the reasonable quantity to the General Administration of Customs, which will then inform the State Administration for
Entry-Exit Inspection and Quarantine.

IV.

All local customs and “three inspections” departments shall strengthen the cooperation and keep each other timely informed in order
to make the administration of processing trade successful.

The above provisions shall be duly implemented.

Attachment: Sample Certificate of Import and Export Commodity Inspection (omitted)