THE MEASURES OF THE CUSTOMS OF THE PEOPLE’S REPUBLIC OF CHINA FOR THE ADMINISTRATION OF SMALL VESSELS COMING FROM AND GOING TO HONG KONG AND MACAO AND THE CARGOES AND ARTICLES ON THEM

Customs General Administration

Decree of the General Administration of Customs of the People’s Republic of China

No. 112

The Measures of the Customs of the People’s Republic of China for the Administration of Small Vessels Coming from and Going to Hong
Kong and Macao and the Cargoes and Articles on them were adopted at the executive meeting of the General Administration of Customs
on January 1st, 2004, which are hereby promulgated and shall be implemented as of March 15th, 2004. The Measures of the Customs of
the People’s Republic of China for the Supervisory Administration of Small Vessels Going between Hong Kong and Macao and the Cargoes
and Articles on them (Decree No. 68 of the General Administration of Customs) and the Measures of the General Administration of Customs
of the People’s Republic of China for the Administration of the Registration and Record Keeping of Small Vessels Coming from and
Going to Hong Kong and Macao (Decree No. 69 of the General Administration of Customs of the People’s Republic of China shall be repealed
at the same time.

Mou Xinsheng, Director of the General Administration of Customs

February 6th, 2004

The Measures of the Customs of the People’s Republic of China for the Administration of Small Vessels Coming from and Going to Hong
Kong and Macao and the Cargoes and Articles on them

Chapter I General Provisions

Article 1

In order to regulate the supervision over small vessels coming from and going to Hong Kong and Macao and the cargoes and articles
carried on them, the present Measures are formulated in accordance with the Law on the Customs of the People’s Republic of China
and other relevant laws and administrative regulations.

Article 2

Definitions of the following terms as mentioned in the present Measures:

(1)

The term “small vessels coming from and going to Hong Kong and Macao” refers to the power-driven vessels and non-power-driven vessels
registered within China, used for transportation of cargoes, specially coming and going between the Mainland and Hong Kong or Macao
upon approval of the Ministry of Communication or its authorized departments.

(2)

The term “customs midway supervisory offices for small vessels” (hereinafter referred to MSOs) refers to the supervisory institutions
established by the customs in Dachandao at Zhujiangkou, Wanchai of Zhuhai, Guishandao outside Zhujiangkou and Dasanmendao to the
East of Hong Kong, which shall be responsible for supervising small vessels and the cargoes and articles carried by them, confirming
customs manifest and making customs seal.

(3)

The term “navigation instructions” refers to the electronic instructions given by the MSOs to the small vessels, such as “Pass by
the MSO directly” and “Stop for undergoing formalities”, etc.

(4)

The term “the specified area” refers to the navigation area centering around an MSO within a certain range. The specific range shall
be announced by the related customs directly under the General Administration of Customs.

Article 3

Small vessels shall enter and exit, anchor, load and unload cargoes and articles, let people get on or get off and undergo relevant
formalities at the ports with customs or the MSOs which are allowed by the customs to assign persons to conduct supervision temporarily.

Article 4

Where any of the following vessels enters or exits China, it shall be subject to the formalities for manifest confirmation and customs
seal at the specified MSO:

(1)

Small vessels coming and going between Hong Kong and the water area of Zhujiang shall go through the relevant formalities at Dachandao
MSO;

(2)

Small vessels coming and going between Hong Kong or Macao and the waterway of Modaomen shall go through the relevant formalities at
Wanchai MSO;

(3)

Small vessels coming and going between Hong Kong or Macao and all the ports along the coasts of Guangdong, Guangxi and Hainan to the
west of the Zhujiangkou and the waterway Modaomen shall go through the relevant formalities at Guishandao MSO;

(4)

Small vessels going between Hong Kong or Macao and all the ports of Guangdong Province to the east of Zhujiangkou, Fujian and along
the coast to the north of Fujian shall go through the relevant formalities at Dasanmendao MSO.

The small vessels coming and going between Hong Kong and Chiwan, Shekou, Mawan and Yantian Port shall directly go through the entry/exit
declaration formalities at the port customs.

Article 5

After being kept record by the customs, a small vessel may engage in transportation of cargoes entering or exiting China.

The small vessel shall, via the shipping enterprise owning this vessel, go through the record-keeping formalities in the customs directly
under the General Administration of Customs or its authorized customs located in the area where the shipping enterprise has completed
the commercial and industrial registration. The customs shall manage the small vessels by keeping record through the Internet and
shall share the data information.

Article 6

Each small vessel shall install ship-borne information receiving and sending device acknowledged by the customs. Under special circumstances,
it may not install such device upon approval of the customs.

No small vessel may have hidden compartments, interlayers or other room for hiding cargoes and articles. The structure of the vessel
shall not be changed after having been verified by the ship inspection department of the state.

Chapter II Management of Record-keeping

Article 7

When a small vessel applies for record-keeping, the shipping enterprise shall submit the following documents to the customs:

(1)

The Registration and Record-Keeping Form for Small Vessels Coming from and Going to Hong Kong and Macao (See Attachment 1);

(2)

Copy of the approving documents issued by the administrative department of transport;

(3)

Copy of the ship inspection certificate issued by China Classification Society or the administrative department of maritime;

(4)

Copy of the vessel’s transportation permit;

(5)

Copy of the vessel’s nationality certificate;

(6)

The diagram of the vessel’s structure; and

(7)

Colored photographs of the front view of the vessel and its profile that shows its name, each in triplicate;

In addition, the original documents of those mentioned in Items (2) through (5) shall be simultaneously submitted to the customs for
verification.

Article 8

Where the customs decides to keep record of a vessel, it shall issue a Registration and Record Keeping Certificate of Small Vessels
Coming from and Going to Hong Kong or Macao within 5 working days from the day when it receives the record-keeping documents (hereinafter
referred to as Record-keeping Certificate, see Attachment 2) and a Supervisory Book of the Customs for Small Vessels Coming from
and Going to Hong Kong and Macao (hereinafter referred to as the Supervisory Book of the Customs, see Attachment 3).

Where the customs decides not to keep record of a vessel upon examination, it shall formulate and issue a Notice on Disapproval of
Record Keeping of Small Vessels Coming from and Going to Hong Kong and Macao (See Attachment 4).

Article 9

The customs shall adopt an annual examination management to small vessels. A shipping enterprise shall submit the following documents
within the time limit as required by the customs and go through the annual examination formalities for small vessels:

(1)

The Annual Examination Report on Small Vessels Coming from and Going to Hong Kong and Macao (See Attachment 5);

(2)

The Record-keeping Certificate; and

(3)

The Supervisory Book of the Customs.

Any small vessel that fails to go through the annual examination or fails to meet the requirements as specified in the present Measures
shall not continue to engage in transportation of cargoes entering and exiting China.

Article 10

Where any of the information registered with the customs, such as a small vessel’s name, structure, route, legal representative, address
or the nature of the enterprise, is changed, the shipping enterprise shall go through the modification formalities with written application
and relevant approving documents.

Chapter III Supervision of Customs

Article 11

Before a small vessel enters China, the person-in-charge or agent of the vessel may itself or authorize a manifest input entity to
send electronic manifest data through pubic data information platform linked with the customs.

Before a small vessel exits China, the person-in-charge or agent of the vessel shall submit a paper manifest to the customs at the
loading port, the Supervisory Book of the Customs and other relevant vouchers and books, at the same time it shall send electronic
manifest data through pubic data information platform linked with the customs.

Article 12

The electronic manifest data shall include: the name and serial number of the tool of transport, the number of voyage, nationality,
loading port, port of destination, number on bills of lading, the consignee or consigner, name of cargo, cargo quantity and weight,
container number and size of container.

Article 13

The person-in-charge of a vessel shall confirm the declared electronic manifest data through the ship-borne receiving and sending
device, when the vessel starts to enter or exit China.

After a vessel has completed the formalities for confirming the electronic manifest data and making the customs seal, the owner or
agent of the imported cargoes may file a declaration to the customs in advance.

Article 14

Where it is necessary to modify the electronic manifest data confirmed by the customs, the person-in-charge or its agent shall file
an application to the customs. The said electronic manifest data may be modified upon consent of the customs.

Article 15

The customs shall preserve the electronic manifest data and track data for 3 years from the day when it confirms the declared manifest
of a small vessel.

Article 16

After a small vessel starts to enter or exit China, it shall enter the specified area, receive and confirm the navigation instructions,
and directly pass by the MSO or anchor near the MSO for going through the relevant formalities according to the instructions.

Article 17

When a small vessel receives the instruction that it shall stop sailing to go through the relevant formalities, it shall sail into
the anchorage as specified by the MSO.

With regard to a small vessel entering China, it may continue to sail to the port of destination within China after its Supervisory
Book of the Customs has been marked and approved by the MSO and it has completed the formalities for confirming the electronic manifest
data and making the customs seal.

With regard to a small vessel exiting China, it shall submit the manifest and other vouchers with the seal of the customs at the port
of loading to the MSO for confirmation. It may continue to sail to the overseas port of destination after its Supervisory Book of
the Customs has been marked by the MSO.

Article 18

After a small vessel arrives at the port of destination within China, the person-in-charge or agent of the vessel shall submit the
Supervisory Book of the Customs, paper manifest and other vouchers to the customs for completing the relevant formalities.

With regard to a small vessel that has gone through the relevant formalities at an MSO, it shall submit the customs seal.

Article 19

The person-in-charge of a small vessel shall properly preserve the paper manifest, customs seal and other vouchers confirmed by the
customs.

Article 20

When a small vessel loads or unloads cargoes entering or exiting China, the person-in-charge or agent of the vessel shall verify the
cargoes according to the manifest, if he (she) finds excessive or short shipment (unloading), wrong shipment (unloading), broken
and damaged goods or any other mistakes, he (she) shall note down properly and tackle this matter in accordance with Article 14
of the present Measures.

Article 21

With regard to the articles for public use and self-use articles of the shipmen carried by a vessel entering or exiting China, one
shall faithfully fill in the Entry-exit Declaration Form for Public Articles Carried by Small Vessels Coming from and Going to Hong
Kong / Macao (See Attachment 6) and the Entry-exit Declaration Form for Self-use Articles Carried by Small Vessels Coming from and
Going to Hong Kong / Macao (See Attachment 7), the customs shall complete the verification and clearance formalities in pursuance
of the relevant regulations

Article 22

Where a small vessel installs machine parts, or re-supplies ship’s fuel, materials and articles for public use, one shall fill in
the Declaration Form for Fuel and Materials Re-supplied Abroad to Small Vessels Coming from and Going to Hong Kong / Macao (See Attachment
8), and shall submit the relevant payment vouchers or invoices to the customs for verification, and shall undergo the import formalities.

Article 23

No small vessel may carry import / export cargoes and non-import / export cargoes on board at the same time.

Article 24

Upon approval of the departments of transport, a small vessel may concurrently engage in transportation within China.

Whenever a small vessel changes the overseas transportation into domestic transportation or vice versa, one shall report to the customs
for archival purposes. The customs shall mark the Supervisory Book of the Customs and complete the relevant formalities.

Article 25

During the period from a small vessel’s entering China to the completeness of the customs clearance formalities, or during the period
after a small vessel has completed the customs formalities at the port of loading, the vessel shall not anchor, load or unload cargoes
and articles or have people get on or get off, without approval of the customs.

Article 26

Where a small vessel anchors, loads or unloads cargoes or articles, or lets people get on or off at a time or area other than the
one specified, it shall have obtained the approval of the customs in advance; where it needs the customs to perform the supervisory
functions, it shall pay the stipulated fees in accordance with the relevant provisions.

Article 27

Where a small vessel is forced to anchor, take up a berth, load or unload cargoes or articles, or lets people get on or off due to
force majeure at a place where no customs is established, the person-in-charge of the vessel shall immediately report to the nearby
customs.

Where a small vessel is unable to anchor in the MSO for completing the entry / exit formalities due to confronting a storm, it may
directly sail to the port of destination upon permission of the MSO.

Article 28

An MSO may put marks on the cargoes carried by a small vessel and the compartments of the vessel, it may assign persons to conduct
supervision over the vessel when the vessel arrives at the port of destination where necessary, the person-in-charge or agent of
the vessel shall provide convenience.

Article 29

Where the customs examines a small vessel, the person-in-charge or agent of the vessel shall be present, shall open all the places,
containers or packages of cargoes and move the cargoes or materials according to the demands of the customs. Where the customs deems
necessary, it may directly conduct examination, re-examination or take samples of cargoes.

When the customs examines the baggage and articles of the shipmen, the relevant shipmen shall be present and shall open the baggage
and packages and places for storing articles.

Chapter IV Legal Liabilities

Article 30

If anyone violates the Customs Law of the People’s Republic of China and the provisions of the present Measures, by smuggling or any
act in violation of the supervisory provisions of the customs, he (she) shall be punished in accordance with the Customs Law of the
People’s Republic of China, the Detailed Rules for the Implementation of the Administrative Punishments of the Customs of the People’s
Republic of China and other relevant laws and administrative regulations. Where any crime is constituted, he (she) shall be subject
to criminal liabilities.

Chapter V Supplementary Provisions

Article 31

The power to interpret the present Measures shall remain with the General Administration of Customs.

Article 32

The present measures shall come into force as of March 15, 2004. The Measures of the Customs of the People’s Republic of China for
the Supervisory Administration of the Small Vessels Coming from and Going to Hong Kong and Macao and Cargoes and the Articles on
them and the Measures of the General Administration of Customs of the People’s Republic of China for the Administration of the Registration
and Record Keeping of the Small Vessels Coming from and Going to Hong Kong and Macao issued by the General Administration of Customs
of the People’s Republic of China on October 17, 1998 shall be repealed at the same time.

Attachments:

1.

The Registration and Record-Keeping Form for Small Vessels Coming from and Going to Hong Kong and Macao (Omitted)

2.

The Register and Record Keeping Certificates for Small Vessels Coming from and Going to Hong Kong and Macao (Omitted)

3.

The Supervisory Book of the Customs for Small Vessels Coming from and Going to Hong Kong and Macao (Omitted)

4.

Notice on Disapproval of Record Keeping of Small Vessels Coming from and Going to Hong Kong and Macao (Omitted)

5.

The Annual Examination Report on Small Vessels Coming from and Going to Hong Kong and Macao (Omitted)

6.

Entry-exit Declaration Form for Public Articles Carried by Small Vessels Coming from and Going to Hong Kong / Macao (Omitted)

7.

Entry-exit Declaration Form for Self-use Articles Carried by Small Vessels Coming from and Going to Hong Kong / Macao (Omitted)

8.

Declaration Form for Fuel and Materials Re-supplied Abroad to Small Vessels Coming from and Going to Hong Kong / Macao (Omitted)