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CIRCULAR OF THE PEOPLE’S BANK OF CHINA FOR FINANCIAL INSTITUTIONS TO STRICTLY CARRY OUT ANTI-MONEY LAUNDERING PROVISIONS FOR THE PREVENTION OF MONEY LAUNDERING RISKS

Circular of the People’s Bank of China for Financial Institutions to Strictly Carry out Anti-money Laundering Provisions for the Prevention
of Money Laundering Risks

January 1, 2005

In January 2003, the People’s Bank of China has issued the Provisions on Anti-money Laundering through Financial Institutions, the
Measures for the Administration on Reports of Large-sum and Suspicious Payment Transactions in Renminbi and the Measures for the
Administration on Reports of Large-sum and Suspicious Foreign Exchange Transactions of Financial Institutions (hereinafter referred
to as “one text of Provisions and two texts of Measures”), which marks that the anti-money laundering work of China has been on the
tract of institutionalization.

In 2004, the People’s Bank of China made a nationwide special anti-money laundering inspection with the focus on commercial banks,
during which it is found that there still exists some prominent problems with the anti-money laundering work of financial institutions:
first, some financial institutions haven’t sufficiently understood or paid sufficient attention to the importance of the anti-money
laundering work; second, the construction of the internal control mechanism for anti-money laundering was not sound enough, and a
number of financial institutions fail to establish and improve relevant institutions and systems as required; third, the anti-money
laundering provisions have not been implemented effectively and sufficiently, and especially, the systems on reporting large-sum
transactions and suspicious fund transactions are needed to be further reinforced and improved; fourth, the anti-money laundering
staff are relatively short of anti-money laundering knowledge and skills. In case these problems remain unresolved, the anti-money
laundering work of China will be seriously restricted from being effectively implemented.

The existence of the aforesaid problems are due to the short time of the anti-money laundering work of China since its beginning as
well as the insufficient work experiences. However, the most important reason is the insufficient understanding and attention. In
order to resolve the aforesaid problems, all financial institutions shall seek their own problems and shortages in respect of understanding,
concept, and measures. In 2005, the People’s Bank of China will strengthen the supervision over the anti-money laundering work of
financial institutions, and strictly investigate and punish acts violating the anti-money laundering provisions according to law.
Hereby, a circular in respect of related issues is made as follows.

1.

All financial institutions shall be sufficiently aware of the importance and necessity of anti-money laundering work, earnestly intensify
the leadership and promote the work initiative.

Money laundering activities foster crimes, disturb the economic order of the state, seriously endanger the financial safety, and impact
the credit of the government and the international image of the state. Doing the anti-money laundering work well relates to the state
security and the stability of economic order, to the effective implementation of laws of the state and to the normal operation of
economy and finance, and is a necessary step to speed up the opening up of financial industry of China, and to propel the integration
with international standards of China’s internal control and management of the risks in the financial industry as well.

Financial institutions are the most important channel of money laundering activities, and are the main position for anti-money laundering
work at the same time. Effectively undertaking the anti-money laundering work is both a piece of absolutely necessary work and a
piece of legal obligation that must be performed. All financial institutions shall, from the height of practicing the important thought
of Three Represents and starting from the overall situation of maintaining political stability, social stability, economic and financial
safety, further advance the awareness, actually change ideas, earnestly strengthen the organization and guidance, enhance the sense
of urgency and initiative in work, actively and consciously establish and perfect systems on internal control of anti-money laundering,
strictly fulfill the legal anti-money laundering obligations, and guarantee the implementation of anti-money laundering provisions
in an all-round way, so as to make the anti-money laundering work of China to be on the channel of regularization and legalization.

2.

Earnestly fulfilling the legal anti-money laundering obligations, and strictly carrying out anti-money laundering provisions.

According to the “One Text of Provisions and Two Texts of Measures”, it is required for financial institutions to establish and improve
systems on internal control of anti-money laundering and to fulfill the relevant obligations on anti-money laundering, which mainly
including,

(1)

Obligation of due-diligence investigation of customers. The financial institution shall, when establishing business relationship or
transacting with a customer, determine and record the customer’s identity information on the basis of the statutory effective identity
certificates and materials. No financial institution may provide any service of deposit or settlement, etc. to a customer who is
of unclear identity, or opens an account in anonym or in fictitious name.

(2)

Obligation of conserving transaction records. The financial institution shall keep the account materials and transaction records of
customers within a certain period. Account materials shall be kept for at least 5 years as of nullification of the account, and transaction
records be kept for at least 5 years as of making the transaction records. The contents of transaction records shall include the
account holder, the amount deposited or drawn via the account, the transaction time, the sources and uses of the funds, the method
for drawing the funds and etc.

(3)

Obligation of reporting large-sum transactions. The financial institution shall make reports to the relevant departments strictly
according to the standards, procedures and time for reporting large-sum transactions as prescribed in “One Text of Provisions and
Two Texts of Measures”.

(4)

Obligation of reporting suspicious transactions. The financial institution shall make reports to the relevant departments strictly
according to the standards, procedures and time for reporting suspicious transactions as prescribed in “One Text of Provisions and
Two Texts of Measures”.

(5)

Other anti-money laundering obligations that financial institutions shall perform.

All financial institutions shall, strictly according to the relevant anti-money laundering provisions, establish an anti-money laundering
system with sound mechanism, perfect system, powerful measures and effective controllability as soon as possible, so as to guarantee
the effective implementation of the anti-money laundering work.

3.

The People’s Bank of China shall strictly carry out laws, and further intensify the supervision and punishment on anti-money laundering
activities.

In the newly amended Law on the People’s Bank of China, it is prescribed that the People’s Bank of China assumes the legal duty of
“making inspection and supervision over the anti-money laundering activities of financial institutions and other entities or individuals”.
In 2005, the People’s Bank of China will, according to the Law on the People’s Bank of China, intensify the supervision and punishment
on anti-money laundering activities, and shall severely penalize, according to law, the financial institutions and the relevant liable
persons who fail to effectively fulfill the obligations as prescribed in anti-money laundering laws and regulations; if any crime
is constituted, the case shall be transferred to the judicial organ for investigation of criminal liabilities.

According to Article 46 of the Law on the People’s Bank of China, where any act in violation of the relevant anti-money laundering
provisions and subject to the punishment provisions of relevant laws and administrative regulations, it shall be punished in light
of such laws and administrative regulations. If there isn’t any provision on punishment, the People’s Bank of China shall, in light
of different circumstances, give warnings, confiscate illegal gains if any, and impose a fine of one time up to five times of the
illegal gains if the illegal gains are more than RMB 500,000 Yuan; and if there are no illegal gains or the illegal gains are less
than 500,000 Yuan, a fine of 500,000 Yuan up to 2 million Yuan shall be imposed. The directly responsible directors, senior managers
in charge and other directly liable persons shall be given a warning, or imposed on a fine of 50,000 Yuan up to 500,000 Yuan; if
any crime is constituted, he shall be subject to criminal liabilities in accordance with law.

All financial institutions and practitioners shall effectively boost up their legal consciousness, further clarify the legal liabilities
borne by them, and shall improve and strengthen the anti-money laundering work, consciously accept the work guidance and supervision
of the People’s Bank of China in light of the requirements of the anti-money laundering provisions.

All branches and business management departments of the People’s Bank of China, and all central sub-branches of the People’s Bank
of China in provincial capital cities and deputy provincial cities shall immediately transmit it to all urban commercial banks, rural
commercial banks, foreign-funded banks, urban and rural credit cooperatives within their respective jurisdictions after receiving
the present Circular.



 
The People’s Bank of China
2005-01-01

 






MEASURES OF THE SUPERVISION AND ADMINISTRATION OF THE INSPECTION AND QUARANTINE IN BONDED ZONES

the State Administration of Quality Supervision, Inspection and Quarantine

Decree of the State Administration of Quality Supervision, Inspection and Quarantine

No. 71

Measures of the Supervision and Administration of the Inspection and Quarantine in Bonded Zones, which were adopted through the discussion
at the ministerial meeting of the State Administration of Quality Supervision, Inspection and Quarantine on December 24, 2004, are
hereby promulgated, and shall come into force since March 1st, 2005.

Director General of the State Administration of Quality Supervision, Inspection and Quarantine, Li Changjiang

January 12, 2005

Measures of the Supervision and Administration of the Inspection and Quarantine in Bonded Zones

Chapter I General Provisions

Article 1

For the purpose of strengthening and regulating the work of the supervision and administration of the inspection and quarantine in
the bonded zones, and promoting the rapid and healthy development of the state economy and trade, the present Measures are formulated
in accordance with the Law of the People’s Republic of China on the Inspection of Import and Export Commodities and its regulations
for the implementation, the Law of the People’s Republic of China on the Quarantine of Animals and Plants Entering and Exiting the
Territory and its regulations for the implementation, the Law of the People’s Republic of China on Frontier Health Quarantine and
its detailed rules for the implementation, and the Law of the People’s Republic of China on Food Hygiene and other relevant laws
and regulations.

Article 2

The present Measures shall be applicable to the administration work of the inspection, quarantine and supervision of goods, as well
as their packing materials, cushioning materials, facilities of transportation, and containers (hereinafter referred to goods subject
to inspection and quarantine), entering and exiting the bonded zones that shall be subject to inspection and quarantine as prescribed
by laws and regulations.

Article 3

The General Administration of Quality Supervision, Inspection and Quarantine (hereinafter referred to as the AQSIQ) shall uniformly
administer the work of the supervision and administration of the inspection and quarantine in the bonded zones nationally. The entry
and exit inspection and quarantine organs (hereinafter referred to as inspection and quarantine organs) established by the AQSIQ
in the bonded zones shall implement inspection, quarantine, supervision and administration on the goods subject to inspection and
quarantine that enter or exit the bonded zones.

Article 4

In case it is necessary to handle the examination and approval procedures for the inspection and quarantine on the goods subject to
inspection and quarantine that enter or exit the bonded zones, the examination and approval procedures shall be handled in accordance
with the provisions of laws and regulations on inspection and quarantine.

Article 5

When any goods subject to inspection and quarantine that enters or exits a bonded zone, the consigner and consignee (the cargo owner)
or their agents shall go through the procedures for the inspection declaration with the inspection and quarantine organ in accordance
with the relevant provisions of the AQSIQ, and the inspection and quarantine organ shall implement inspection and quarantine according
to the relevant state laws, regulations and rules and the provisions of the AQSIQ, and the customs house shall release the goods
on the basis of the certificate of customs clearance of goods issued by the inspection and quarantine organ.

Article 6

The inspection and quarantine organ shall strengthen cooperation and coordination with the customs, and implement inspection and quarantine
on the goods subject to inspection and quarantine that enter or exit the bonded zones in accordance with the facile and effective
principle.

Chapter II Inspection and Quarantine on the Goods Subject to Inspection and Quarantine Imported to Bonded Zones

Article 7

In case the goods subject to inspection and quarantine that enter into the bonded zones from abroad fall within the scope of health
quarantine, the inspection and quarantine organ shall implement health quarantine on them; for those that shall be subject to sanitary
treatment, the inspection and quarantine organ shall carry out sanitary treatment on them.

Article 8

In case the goods subject to inspection and quarantine that enter into the bonded zones from abroad fall within the scope of animals
and plants quarantine, the inspection and quarantine organ shall implement animals and plants quarantine on them; for those subject
to anti-pest treatment of animals and plants quarantine, the anti-pest treatment shall be conducted in accordance with the law under
the supervision of the inspection and quarantine organ.

Article 9

The inspection and quarantine organ shall implement inspection, supervision and administration on the solid waste, old mechanical
and electrical products, whole set of equipment that enter into the bonded zones from abroad and may be used as materials, and evaluate
the value of the foreign investment assets according to the relevant provisions, and shall not conduct inspection on those goods
whose customs clearance formalities have not been handled.

Article 10

The compulsory product certification shall be exempted on the warehousing and logistic goods that enter into the bonded zones from
abroad by the enterprises in the bonded zones and the self-use office supplies, raw materials needed for export processing, and components
and parts.

Article 11

If there is no need to go through customs clearance procedures for the goods subject to inspection and quarantine that enter into
the bonded zones from non-bonded zones within the territory of the People’s Republic of China (excluding the Hong Kong and Macao
regions, hereinafter referred to as the non-bonded zones), the inspection and quarantine organ shall not implement inspection and
quarantine on them; if it is necessary to go through customs clearance procedures, the inspection and quarantine organ shall implement
inspection and quarantine on the goods subject to inspection and quarantine according to the provisions.

Chapter III Inspection and Quarantine on the Goods Subject to Inspection and Quarantine Exported from Bonded Zones

Article 12

In the case of the goods subject to inspection and quarantine that are exported abroad from the bonded zones, the inspection and quarantine
organ shall implement inspection and quarantine on them according to the law..

Article 13

In the case of the goods subject to inspection and quarantine that are exported to non-bonded zones from bonded zones, unless there
are other provisions set forth by any law or regulation, no quarantine may be conducted on.

Article 14

In case the goods subject to inspection and quarantine that are exported from bonded zones to non-bonded zones fall within the scope
of food hygiene supervision and inspection and commodity inspection, the inspection and quarantine organ shall conduct inspection
on them.. Goods that enter into the territory in a single batch but leave the zones by several batches may be declared for inspection
by batches, and be inspected batch by batch; in the case of those that are in accordance with relevant conditions, they may be declared
for inspection as a single batch when entering into the territory, and be inspected as a single batch, and for those inspected qualified,
they may be written off by batches when passing the bonded zones.

Article 15

According to the provisions of Article 9 of the present Measures, the goods from a bonded zone which have been inspected when entering
into the territory are not subject to inspection when they are exported to non-bonded zones.

According to the provisions of Article 11 of the present Measures, the goods which enter into a bonded zone from a non-bonded zone
and then are exported to non-bonded zones are not subject to inspection.

Article 16

In case the goods subject to inspection and quarantine that are exported to non-bonded zones from the bonded zones, are listed on
the catalogue for compulsory product certification, the corresponding certification certificate shall be provided, and the mark of
compulsory product certification shall be posted on the products.

Article 17

For the foods and cosmetic products to be packed that are transported from a bonded zone to a non-bonded zone, the formalities shall
be handled with the inspection and quarantine organ for examination and approval of labels.

Article 18

In case the goods exit the territory directly without being processed after entering the bonded zones from the non-bonded zones, the
inspection and quarantine organ in the bonded zones shall change the certificate and release them on the basis of the conformity
certificate of inspection and quarantine that are issued by the inspection and quarantine organ in the bonded zones, and no inspection
and quarantine is required. If they have exceeded the period of validity for inspection and quarantine, or have changed the country
or region of import and have different requirements for inspection and quarantine, or have changed their packages or have been reassembled,
or have revoked their inspection declaration, an inspection declaration shall be made again as provisions require.

Article 19

In case any enterprise in the bonded zones that processes any product exiting the territory, complies with the relevant provisions,
it may apply to the inspection and quarantine organ for issuing a GSP certificate of place of origin or a general certificate of
place of origin, a certificate of place of origin of regional preference, or a special certificate of place of origin, etc..

Chapter IV Inspection and Quarantine of the Goods Subject to Inspection and Quarantine Re-exported through Bonded Zones

Article 20

In case the animals and plants, products from animals and plants and other goods subject to quarantine enter into the territory and
are declared for inspection, the official quarantine certificate issued by exporting country or local government shall be provided
; for animals re-exported, the Permit for Animals Passing through the Territory of China issued by the AQSIQ and the certificate
allowing them to enter into the territory issued by the exporting country or local government shall be provided at the same time;
for the re-exported genetically modified products, the Permit for Transfer of Genetically Modified Products Passing through the Territory
of China issued by the AQSIQ shall be provided at the same time.

Article 21

In case the goods subject to inspection and quarantine which are re-exported through bonded zones are stored temporarily in the bonded
zones, re-exported out of the territory with the original packing and in apparently good packing and airtight status without damage
or leakage, only the quarantine on the outer packing may be conducted when they enter into the territory, and the disposal of epidemic
prevention and disinfection may be conducted if necessary.

Article 22

In case the goods subject to inspection and quarantine which are re-exported through the bonded zones are re-exported out of the territory
due to such reasons as bad packing or classification, selection, brushing or posting labels, or changing the packing forms and other
simple process in the bonded zones, the inspection and quarantine organ shall implement health quarantine, quarantine of animals
and plants and food hygiene inspection on them.

Article 23

In case the goods subject to inspection and quarantine are re-exported out of the territory, in general, no quarantine or quarantine
is required unless there are otherwise different provisions in any law or regulation or the local government of the importing country
or region requires the presentation of the quarantine certificate or quarantine disposal certificate issued by the inspection and
quarantine organ of our country when the goods enter into their territories.

Chapter V Supervision and Administration

Article 24

The import and export processing enterprises, international trade enterprises, international logistic enterprises and import and export
commodity exhibition enterprises established within the bonded zones shall apply for archival filing to the inspection and quarantine
organ.

Article 25

The enterprises engaging in the processing and storing of products from animals and plants entering into and exiting the territory
within the bonded zones shall accord with the relevant provisions on inspection and quarantine.

Article 26

Enterprises engaging in the processing and storing of foods exiting the territory within the bonded zones shall handle health registration
of enterprises producing the export food, in case there are additional requirements by the importing country or region, the requirements
of the importing country or region shall also be met; the enterprises engaging in the processing and storing of foods entering into
the territory shall accept the supervision and administration by the inspection and quarantine organ according to the general health
specifications of the food enterprises.

Article 27

The relevant requirements of inspection and quarantine shall be met for the establishment of an inspection and quarantine place or
a place for quarantine fumigation treatment and disinfection treatment in a bonded zone.

Article 28

An inspection and quarantine organ shall conduct monitoring on the epidemic situation in the bonded zones in accordance with the relevant
provisions of laws and regulations, and conduct supervision over the quarantine of animals and plants that enter into and exit from
the bonded zones, and over the process for the production, processing, deposit and transfer of their products.

Article 29

The inspection and quarantine shall be exempted in the case of the sale and transfer of import and export goods subject to inspection
and quarantine among the enterprises within the bonded zones.

Article 30

In case the examination and approval for the quarantine of animals and plants and their products entering and exiting the territory
has been completed, and there is necessity to change the items subject to examination and approval, the related parties shall file
an application for the approval of the alteration of quarantine examination.

Chapter VI Supplementary Provisions

Article 31

The inspection, quarantine, supervision and administration of such areas as the bonded warehouses and bonded logistic parks, etc.
shall be applied with reference to the present Measures.

Article 32

In the case of the acts in violation of the provisions of the present Measures, the inspection and quarantine organ shall give an
administrative punishment according to the relevant laws and regulations.

Article 33

The power to interpret the present Measures shall be vested in the AQSIQ.

Article 34

The present Measures shall come into force since March 1st, 2005. The Measures for the Administration of Quarantine of Animals and
Plants in Bonded Zones, which were promulgated by the former Bureau of Inspection of Animals and Plants of the People’s Republic
of China on April 10, 1998 shall be abolished simultaneously.



 
the State Administration of Quality Supervision, Inspection and Quarantine
2005-01-12

 






CONSTITUTION ACT, 1982 – page 22

NOTES (1) The enacting clause was repealed by the Statute Law Revision Act, 1893, 56-57 Vict., c. 14 (U.K.). It read as...

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

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