PROVISIONS ON THE MANAGEMENT OF GREEN PASSAGEWAY SYSTEM FOR INSPECTION AND QUARANTINE OF EXPORT GOODS

The State Administration of Quality Supervision, Inspection and Quarantine

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

No.50

Provisions on the Management of Green Passageway System for Inspection and Quarantine of Export Goods, which have been examined and
adopted at the executive meeting of the State Administration of Quality Supervision, Inspection and Quarantine on June 19th 2003,
are hereby promulgated and shall come into force since promulgation.

Director Li Changjiang

July 18, 2003

Provisions on the Management of Green Passageway System for Inspection and Quarantine of Export Goods

Chapter I General Provisions

Article 1

With a view to speeding up the customs clearance process, facilitating the customs release of export goods and promoting export, the
Provisions are formulated in accordance with the Law of the People’s Republic of China on Import and Export Commodity Inspection
and the implementation rules thereof.

Article 2

The term “green passageway system for inspection and quarantine” (hereinafter referred to as the green passageway system) in the Provisions
refers to the release management pattern of granting inspection and quarantine certificate at the production area with exemption
for inspections by the port inspection and quarantine authority for the qualified export goods of the production and operation enterprises
that have good credit rating, sound and stable product quality guarantee system and relatively large export scale, upon the examination
and approval by the State Administration of Quality Supervision, Inspection and Quarantine (hereinafter referred to as the SAQSIQ).
The principle of voluntary application by enterprises shall be adopted in the application of the green passageway system.

Article 3

The SAQSIQ shall take charge of supervision and administration of the nation-wide green passageway system for export goods and implement
verification and approval of the enterprises to be covered by the green passageway system. Local administrations of exit-entry inspection
and quarantine directly under the SAQSIQ (hereinafter referred to as the administrations of inspection and quarantine directly under
SAQSIQ) shall be in charge of the examination, supervision and administration of the enterprises to be covered by the green passageway
system within their respective jurisdictions. Local institutions in charge of exit-entry inspection and quarantine established by
the SAQSIQ (hereinafter referred to as the inspection and quarantine institutions) shall be responsible for acceptance of applications,
preliminary examination and regular administration of the enterprises to be covered by the green passageway system within their respective
jurisdictions.

Article 4

The SAQSIQ shall determine and adjust the scope of export goods to which the green passageway system are applied, in accordance with
the real situation of inspection and quarantine for export goods as well as the implementation outcome of the green passageway system.
The green passageway system shall not apply to the bulk goods or goods that are quality-unstable or liable to deterioration or require
replacement of the inspection and quarantine certificate at the port.

Chapter II Enterprise Qualification

Article 5

A enterprise applying for coverage of the green passageway system shall meet the following conditions:

(1)

having good reputation and sound credit rating, with the annual export volume exceeding USD5,000,000;

(2)

having implemented the ISO9000 quality management system and obtained the certificate of eligibility in assessment and examination
of the production enterprise quality system issued by the relevant organ;

(3)

having long-term stable quality for the export goods and have not been involved in quality-based compensation claim or dispute with
the import country within the recent two years;

(4)

having no improper inspection applications within a year and having no record of administrative sanctions by the inspection and quarantine
institutions within two years;

(5)

belonging to the first-grade or second-grade enterprises if classified administration of production enterprises is applied pursuant
to the relevant provisions of SAQSIQ￿￿

(6)

having obtained registration for marks of production area where it is required by any law, regulation, or bilateral agreement for
the use of marks for the production area;

(7)

other conditions stipulated by the SAQSIQ.

Article 6

The applicant enterprise should make the following commitment:

(1)

complying with the laws and regulations on exit-entry inspection and quarantine and the Provisions on the Application for Exit-Entry
Inspection and Quarantine;

(2)

adopting e-application;

(3)

ensuring conformity between the export goods and their certificates, the eligibility of batch numbers and complete marks￿￿keeping
the sealing intact if sealing is adopted;

(4)

conducting no such illegal activities as replacing or stealthily substituting goods when the export goods are carried to the port
after having obtained the inspection and quarantine certificate from the inspection and quarantine institutions;

(5)

voluntarily accepting the supervision and administration by the inspection and quarantine institutions.

Article 7

Enterprises applying for the adoption of the green passageway system shall ask for and fill in the Application Form for Adoption of
the Green Passageway System (see attachment) and at the same time, submit the Certificate of ISO9000 Quality Management System Accreditation
(photocopy) as well as other relevant documents.

Chapter III Examination and Approval

Article 8

The inspection and quarantine institutions in charge of application acceptance shall complete the preliminary examination in accordance
with the provisions as follows:

(1)

examining the application documents;

(2)

verifying and investigating the facts about the enterprise’s quality guarantee system and the quality of its export goods and whether
it has improperly applied for inspection or other acts in violation of the provisions on inspection and quarantine￿￿and

(3)

proposing the opinion on preliminary examination and submitting it to the superior administration of inspection and quarantine directly
under SAQSIQ.

Article 9

The administration of inspection and quarantine directly under SAQSIQ shall review the preliminary examination opinion and report
the list of qualified enterprises and the relevant documents to the SAQSIQ.

Article 10

The SAQSIQ shall give approval to the enterprises meeting the relevant requirements of the green passageway system. The approved list
of enterprises to be covered by the green passageway system shall be made public by the SAQSIQ.

Chapter IV Inspection and Quarantine at Production Area

Article 11

For those in conformity with the following provisions, the inspection and quarantine institutions at the production area shall conduct
the acceptance of inspection applications by referring to the green passageway system.

(1)

For self-operating export enterprises covered by the green passageway system, the applicant entity for inspection, the consigner and
the production enterprise shall be the same￿￿

(2)

For operating enterprises covered by the green passageway system, the applicant entity for inspection and the consigner shall be the
same, and the export goods operated shall be produced by the production enterprises covered by the green passageway system.

Article 12

For the export enterprises approved to adopt the green passageway system, the inspection and quarantine institutions where the enterprises
are located shall confirm their qualification for coverage of the green passageway system in the sub-system for inspection application
of the CIQ2000 System.

Article 13

The workers of the inspection and quarantine institutions shall conduct examination in strict compliance with the requirements of
the green passageway system when accepting the e-inspection applications of the enterprises covered by the green passageway system.
For those failing to meet the relevant requirements, reasons should be given in the return receipt for inspection application

Article 14

If any enterprise failing to meet the requirements for the green passageway system coverage are found during the inspection process,
the personnel of the inspection and quarantine institutions shall write the words “failing to meet the requirements for green passageway
system coverage” in the column of inspection and quarantine opinion of the Flow Diagram for Inspection and Quarantine or the relevant
inspection and quarantine records.

Article 15

The inspection and quarantine institutions at the production area shall strengthen the examination of the inspection application documents
and the inspection & quarantine documents for export goods covered by the green passageway system, and e-transmit the qualified documents
to the port inspection and quarantine institutions to form the customs clearance data. During the transmission of documents, the
specified code of the port of customs declaration should be input and the Certificate of Document Transmission issued.

Chapter V Port Examination and Release

Article 16

The port inspection and quarantine institutions should establish service windows for enterprises adopting the green passageway system.

Article 17

For export goods of the enterprises covered by the green passageway system, the port inspection and quarantine institutions shall
enter the subsystem for inspection application of the CIQ2000 System and launch the green passageway function.

Article 18

For enterprises adopting the green passageway system, the port inspection and quarantine institutions shall conduct stringent examination
over the information concerning the green passageway system in the e-document transmission date. If no problems are found in the
examination, the Notice of Customs Clearance For Outward Goods will be issued directly without inspections.

If the enterprises covered by the green passageway system alter the declaration contents at the port, the port inspection and quarantine
institutions shall not refer to the green passageway system for release.

Chapter VI Supervision and Administration

Article 19

The inspection and quarantine institutions at the production area shall establish the management files for, and strengthen the management
over enterprises covered by the green passageway system.

Article 20

Upon discovering non-conformance to the self-discipline commitment of the enterprise covered by the green passageway system or other
acts in violation of the provisions, the port inspection and quarantine institution shall make a report in good time to the administration
of inspection and quarantine directly under SAQSIQ where the port is located.

After verification, the administration of inspection and quarantine directly under SAQSIQ where the port is located shall notify the
administration of inspection and quarantine directly under SAQSIQ at the production area. The latter shall suspend the adoption the
green passageway system for the enterprise and submit to the SAQSIQ the opinion on canceling the coverage of the green passageway
system for the enterprise. After confirmation, the SAQSIQ shall disqualify the enterprise from adopting the green passageway system.

Article 21

The Inspection and quarantine institutions at the port and the production area shall make statistical reports on the implementation
of the green passageway system on a regular basis and establish the mutual notification system.

Chapter VII Supplementary Provisions

Article 22

The right to interpret the Provisions shall remain with the State Administration of Quality supervision, Inspection and Quarantine.

Article 23

The Provisions shall come into force as of the date of its promulgation.