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2005

CIRCULAR OF THE MINISTRY OF FOREIGN TRADE AND ECONOMIC COOPERATION CONCERNING THE RELEVANT ISSUES ON THE ADJUSTMENT OF THE MEASURES FOR THE ADMINISTRATION OF THE EXPORT MANAGEMENT OF THE DRAWNWORK PRODUCTS

The Ministry of Foreign Trade and Economic Cooperation

Circular of the Ministry of Foreign Trade and Economic Cooperation Concerning the Relevant Issues on the Adjustment of the Measures
for the Administration of the Export Management of the Drawnwork Products

WaiJingMaoGuanFa [1999] No.745

December 17, 1999

Commissions (departments, bureaus) of foreign trade and economic cooperation in various provinces, autonomous regions, municipalities
directly under the Central Government and municipalities separately listed on the State plan, every concerned enterprise of foreign
trade and economic cooperation:

In order to seriously carry out the Circular of the General Office of the State Council for Transmitting the Opinions of the Ministry
of Foreign Trade and Economic Cooperation and other Ministries on Taking Further Measures to Encourage Expanding Foreign Trade Export
(GuoBanFa [1999] No.71), to further decrease product varieties under export quota and license control and to relax the control on
export right, the Ministry of Foreign Trade and Economic Cooperation, based on the drawnwork export performance in the recent two
years, has decided to abolish the license control on drawnwork export and stop checking and ratifying drawnwork export qualifications
of export companies starting from January 1,2000. The Circular on Printing and Distributing the Interim Provisions for the Export
Administration of the Drawnwork Products (WaiJingMaoGuanFa [1997] No.614) is nullified simultaneously.

The Circular hereby given shall be implemented accordingly.



 
The Ministry of Foreign Trade and Economic Cooperation
1999-12-17

 






PROVISIONAL REGULATIONS ON COLLECTION AND PAYMENT OF SOCIAL INSURANCE PREMIUMS

Category  INSURANCE Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1999-01-22 Effective Date  1999-01-22  


Provisional Regulations on Collection and Payment of Social Insurance Premiums

Chapter I  General Provisions
Chapter II  Administration of Collection and Payment
Chapter III  Supervision and Examination
Chapter IV  Penalty Provisions
Chapter V  Supplementary Provisions

(Adopted at the 13th Executive Meeting of the State Council on January 14,1999, promulgated by Decree No.259 of the State Council
of People’s Republic of China on January 22, 1999)

Chapter I  General Provisions

    Article 1  These Regulations are formulated to strengthen and regularize collection and payment of social insurance premiums, and
to ensure the granting of social insurance compensation.

    Article 2  These Regulations are applicable to collection and payment of basic pensions, basic medical insurance premiums and unemployment
insurance premiums (hereinafter collectively referred to “social insurance premiums”).

    A unit or an individual paying premiums mentioned in these Regulations refers to the unit or individual who
shall pay social insurance premiums according to the provisions of relevant laws, administrative regulations and of the State Council.

    Article 3  The collection and payment scope of basic pensions: State-owned enterprises, collectively owned enterprises in cities
and towns, enterprises with foreign investment, privately owned enterprises in cities and towns and other enterprises in cities and
towns as well as their staff and workers, and institutions managed as enterprise as well as their staff and workers.

    The collection and payment scope of basic medical insurance premiums: State-owned enterprises, collectively
owned enterprises in cities and towns, enterprises with foreign investment, privately owned enterprises in cities and towns and other
enterprises in cities and towns as well as their staff and workers, State organs and their functionaries, institutions and their
staff and workers, private non-enterprise unit as well as their staffs and workers, social organizations and their full-time staff.

    The collection and payment scope of unemployment insurance premiums: State-owned enterprises, collectively
owned enterprises in cities and towns, enterprises with foreign investment, privately owned enterprise in cities and towns and other
enterprises in cities and towns as well as their staff and workers, institutions as well as their staff and workers.

    The people’s governments of provinces, autonomous regions and municipalities directly under the Central Government,
according to the actual local situations, may provide for the incorporation of individual industrial and commercial businesses in
cities and towns into the collection and payment scope of basic pensions and basic medical insurance, and may provide for the incorporation
of social organizations and their full-time staff,  private non-enterprise units and their staffs and workers, as well
as individual industrial and commercial businesses in cities and towns with employees and their employees into the collection and
payment scope of unemployment insurance.

    The base and rate of social insurance premiums shall be set fixed in accordance with relevant laws and administrative
regulations as well as provisions of the State Council.

    Article 4  Units and individuals paying premiums shall promptly pay social insurance premiums in full amount.

    Social insurance premiums collected and paid shall be incorporated into social insurance funds and only used
for their special purposes. No unit and individual may misappropriate these premiums.

    Article 5  The administrative department of labor security under the State Council is responsible for the nationwide administration,
supervision and checkup of the collection and payment of social insurance premiums. The administrative departments of labor security
of the people’s governments at or above the county level are responsible for the administration, supervision and checkup of the collection
and payment of social insurance premiums within their respective administrative areas.

    Article 6  Social insurance premiums shall be collected in a way that three kinds of social insurance premiums are collected centrally
and uniformly. The people’s governments of provinces, autonomous regions, and municipalities directly under the central Government
shall prescribe the collecting agencies. They may collect by taxation departments, or by social insurance agencies established by
the administrative department of labor security according to the provisions of the State Council (hereinafter referred to as social
insurance agencies).
Chapter II  Administration of Collection and Payment

    Article 7  Units paying premiums must carry out social insurance registration with local social insurance agencies to participate
in social insurance.

    The registration items include: name and domicile of the unit, its business place, type of the unit, its legal
representative or person in charge, its bank account number and other items prescribed by the administrative department for labor
security of the State Council.

    Article 8  Units paying premiums which have already participated in social insurance before the enforcement of these Regulation shall,
within 6 months of the date of enforcement of these Regulation, carry out social insurance registration with the local social insurance
agencies, and the said agencies shall issue them a social insurance registration certificate.  

    Units paying premiums which have not participated in social insurance before the enforcement of these Regulation,
within 30 days of the date of enforcement of these Regulations, and units paying premiums which are established after the enforcement
of these Regulations, within 30 days of the date of their establishment, shall apply for social insurance registration at the local
social insurance agencies on the basis of their business licenses, registration certificates or other such relevant certificates.
After verification, the social insurance agencies shall issue them a social insurance registration certificate.

    Social insurance registration certificate may not be forged or altered.

    The form of social insurance registration certificate shall be determined by the administrative department
of labor security of the State Council.

    Article 9  If the social insurance registration items of a unit paying premiums change or the unit paying premiums is terminated
according to law, procedures for change or cancellation of the social insurance registration shall be carried out with the social
insurance agency within 30 days of the date of the change or termination.

    Article 10  Units paying premiums shall, on a monthly basis, report to the social insurance agency the amount of social insurance
premiums payable and, after assessment by the social insurance agency, pay their social insurance premiums within the prescribed
time period.

    If a unit paying premiums fails to report the amount of social insurance premiums payable according to provisions,
the social insurance agency `shall provisionally set the amount payable at 110 per cent of the premium amount paid in the preceding
month. If it did not make a premium payment in the preceding month, the social insurance agency shall provisionally set the amount
payable according to the unit’s business situations, its number of staff and workers and other such relevant circumstances. After
a unit paying premiums has retroactively carried out its reporting procedures and paid the social insurance premiums according to
the sum assessed, the social insurance agency shall settle the accounts according to provisions.

    Article 11  If the people’s government of a province, an autonomous region or a municipality directly under the Central Government
has determined that the
tax authorities shall levy and collect social insurance premiums, the social insurance agency shall promptly provide the tax authorities
with the relevant information of the social insurance registration, changes of registration, cancellation of registration and premium
payment reports of the unit paying premiums.  

    Article 12  Units and individuals paying premiums shall pay their social insurance premiums in cash and in full.

    The social insurance premiums payable by individuals paying premiums shall be withheld from their wages and
paid for them by their work units.

    Social insurance premiums may not be reduced or exempted.

    Article 13  If a unit paying premium fails to pay its own social insurance premiums or to withhold and pay those of its staff and
workers according to provisions, the administrative department of labor security or tax authority shall order it to pay within a
prescribed time limit; if it has still not paid at the end of the time limit, in addition to paying the sum owned, it shall pay a
late-payment fine of 0.2 per cent per day, counting from the date when the amount became overdue. Late-payment fines shall be consolidated
into the social insurance funds.

    Article 14  Social insurance premiums collected shall be deposited into a dedicated public finance account for social security funds
opened by the public finance authorities with a State-owned commercial bank.

    The social insurance funds established shall respectively be basic old age insurance funds, basic medical
insurance funds, and unemployment insurance funds according to the pooling scope for the risk concerned. Separate and independent
accounts shall be maintained for each type of social insurance funds.

    No taxes of fees shall be calculated or levied on social insurance funds.

    Article 15  If the people’s government of a province, an autonomous region or a municipality directly under the Central Government
has determined that the tax authorities shall levy and collect social premiums, the tax authorities shall promptly provide the social
insurance agencies with information of the premium payments of units and individuals paying premiums. The social insurance agencies
shall consolidate the relevant matters and submit them to the administrative departments of labor security.  

    Article 16  Social insurance agencies shall establish premium payment records. Of such records, those that pertain to basic old age
insurance and basic medical insurance shall contain a record of the personal accounts, according to provisions. Social insurance
agencies shall be responsible for maintaining premium payment records and ensuring their completeness and security. Social insurance
agencies shall issue statements to individuals paying premiums concerning their basic old age insurance and basic medical insurance
personal accounts at least once a year.

    Units and individuals paying premiums are enpost_titled to access their premium payment records according to provisions.
Chapter III  Supervision and Examination

    Article 17  Unit paying premiums shall announce to their staff and workers on a annual basis details of the units’ social insurance
premium payments for the whole year, and accept the supervision of their staff and workers.  

    Social insurance agencies shall periodically inform the public on details of the levy and collection of social
insurance premiums, and accept the supervision of the society.

    Article 18  According to the provisions of the people’s governments of provinces, autonomous regions and municipalities directly under
the Central Government on collecting agencies of social insurance premiums, when an administrative department of labor security or
a tax authority conducts an examination of the premium payments of a unit according to law, the unit being examined shall provide
such information relevant to the payment of social insurance premiums as employment details, payrolls and financial statements, etc.,
and truthfully report the situation. The unit examined may not refuse the examination or make false or deceptive reports. The administrative
department of labor security or the tax authority may make a written record of, audio tape, videotape, photograph or photocopy materials;
however, they shall maintain the confidentiality of the unit paying premiums.

    When conducting the duties indicated in the preceding paragraph, the personnel of the administrative department
of labor security or the tax authority shall produce their proof of carrying out official business.

    Article 19  When an administrative departments of labor security or a tax authority investigates cases of the illegal acts related
to the collection and payment of social insurance premiums, the relevant departments and units shall provide support and cooperation.  

    Article 20  Subject to authorization by the administrative departments of labor security, social insurance agencies may conduct examination
and investigation related to the collection and payment of social insurance premiums.

    Article 21 Any organization or individual has the right to report illegal acts related to the collection and payment of social insurance premiums.
The administrative department of labor security or the tax authority shall promptly investigate the report, handle it according to
provisions, and maintain the confidentiality of the person making the report.

    Article 22  Payments into and out of the social insurance fund shall be subject to separate administration and shall be supervised
by the public finance departments according to law.

    The auditing departments shall supervise the payments into and out of the social insurance fund according
to law.
Chapter IV  Penalty Provisions

    Article 23  If a unit paying premiums fails to carry out social insurance registration, change its registration or cancel its registration
according to provisions, or fails to report the amount of social insurance premiums payable according to provisions, the administrative
department of labor security shall order it to correct situation within a prescribed time limit; in serious cases, a fine of not
less than 1,000 yuan and not more than 5,000 yuan may be imposed on the person in charge who are directly responsible and other directly
responsible persons; in particularly serious cases, a fine of not less than 5,000 yuan and not more than 10,000 yuan may be imposed
on the person in charge who are directly responsible and other directly responsible persons.  

    Article 24  If a unit paying premiums violates relevant financial, accounting or statistics laws or administrative regulations or
relevant State regulations, or forges, alters or intentionally destroy relevant account books or documents, or fails to keep accounts,
thereby making it impossible to determine the base number for the collection and payment of social insurance premiums, it shall not
only be subjected to administrative penalties, disciplinary punishment and/or criminal prosecution in accordance with the provisions
of the relevant laws and administrative regulations, but it shall also make payment in accordance with Article 10 of these Regulations.
If it delays payment, the administrative department of labor security or the tax authority shall decide to impose a late-payment
fine in accordance with Article 13 of these Regulations and impose a fine of not less than 5,000 yuan and not more than 20,000 yuan
on the person in charge who are directly responsible and other directly responsible persons.

    Article 25  Units or individuals paying premiums dissatisfied with the penal decisions of the administrative departments of labor
security or tax authorities may apply for reconsideration of the cases according to law. If the units or individuals are dissatisfied
with the decisions made upon reconsideration, thy may file suits according to law.

    Article 26  If a unit paying premiums refuses to pay its social insurance premiums or late-payment fines after the time limit for
payment thereof has expired, the administrative department of labor security or the tax authority shall apply to the people’s court
to enforce payment according to law.

    Article 27  If personnel of an administrative department of labor security, social insurance agency or tax authority abuse their powers,
practise favoritism or graft, or neglect their duties, resulting in the loss of social insurance premiums, the administrative department
of labor security or the tax authority shall pursue the recovery of the lost social insurance premiums; if a comical offence is constituted,
criminal liability shall be pursued according to law; if no criminal offence is constituted, administrative punishment shall be imposed
according to law.

    Article 28  If any unit or individual misappropriates social insurance funds, the recovery of the misappropriated funds shall be pursued,
and any illegal income shall be confiscated and consolidated with the social insurance funds; if a comical offence is constituted,
criminal liability shall be pursued according to law; if no criminal offence is constituted, the persons in charge directly responsible
and other directly responsible persons shall be subjected to administrative punishment according to law.
Chapter V  Supplementary Provisions

    Article 29  The peoples’ governments of provinces, autonomous regions and municipalities directly under the Central Government, according
to the actual local conditions, may determine that these regulations shall apply to the collection and payment of work-related injury
insurance and maternity insurance premiums within their respective administrative areas.

    Article 30  The tax authorities and social insurance agencies may not make any appropriations from the social insurance funds to cover
expenses incurred in their levy and collection of social insurance premiums. Funding for the necessary expenses shall be included
in the budget and appropriated form public finance.

    Article 31  These Regulation shall take effect as of the date of promulgation.





ANNOUNCEMENT OF CHINA INSURANCE REGULATORY COMMISSION ON STRICTLY PROHIBITING OVERSEAS INSURANCE INSTITUTION FROM UNDERTAKING ILLEGAL INSURANCE AND INTERMEDIARY

The China Insurance Regulatory Commission

Announcement of China Insurance Regulatory Commission on Strictly Prohibiting Overseas Insurance Institution from Undertaking Illegal
Insurance and Intermediary

[1999] No. 6

March 30, 1999

It is investigated that a few overseas and HK, Macao, Twain insurance companies and intermediary institutions recruit the business
men or agents and engage in the business of insurance and intermediary illegally in our country without the approval of the insurance
supervision institutions. In order to maintain the normal order of internal insurance market and the interest of the insure, the
China Insurance Regulatory Commission (hereinafter referred to CIRC) declares the following:

I.

Without the approval of the insurance supervision institutions, recruitment of the businessmen or engagement in the business of insurance
through the agents and brokers should not be allowed by the overseas and HK, Macao, Twain insurance companies and intermediary institutions
established in our country.

II.

The agent offices of the overseas insurance companies in China should not undertake the business of insurance, reinsurance and intermediary
contrary to their business range. Once found, they should be disposed seriously and cancelled the qualification of establishment
of the agent office in China.

The domestic institutions or residents should report to CIRC if they discover the overseas insurance companies or its agent offices
in China recruiting the business men or agents and engageing in the business of insurance and intermediary illegally in our country
without the approval of the insurance supervision institution. CIRC will investigate the reported illegal business and dispose seriously
with the relevant institutions according to the laws.



 
The China Insurance Regulatory Commission
1999-03-30

 






PROVISIONS ON CONTROL OVER THE ECONOMIC INSPECTION ON ENTERPRISES

Category  JUDICIAL ADMINISTRATION Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1999-07-23 Effective Date  1999-07-23  


Provisions on Control over the Economic Inspection on Enterprises



(Formulated by the State Economic and Trade Commission, the State Development Planning Commission, the Ministry of Finance, the Ministry of Personnel, National Audit Office, the State Administration of Taxation, National Bureau of Statistics,
the State Administration of Industry and Commerce, the State Bureau of Quality and Technical Supervision and the State Administration
of Foreign Exchange, approved by the State Council on July 9, 1999 and promulgated by the State Economic and Trade Commission on
July 23, 1999)

    Article 1  These Provisions are formulated in order to standardize activities of economic inspection on enterprises conducted by
administrative organs, alleviate enterprises’ burden and maintain the economic order of the socialist market.

    Article 2  The term “economic inspection” mentioned in these Provisions refers to inspection conducted by administrative organs on
the situations of obedience of laws and regulations in enterprises’ production and operation.

    Administrative organs mentioned in the preceding paragraph include departments of economy and trade, finance,
price, taxation, industry and commerce, quality and technical supervision, foreign exchange control, audit, etc.

    Article 3  Except as clearly stipulated by laws and regulations, no administrative organ is allowed to conduct economic inspection
on enterprises without authorization.

    Article 4  When conducting economic inspection on enterprises according to laws and regulations, administrative organs shall make
overall plan, pay close attention to efficiency, ensure quality and avoid repetition.

    Article 5  Before conducting economic inspection on enterprises, administrative organs shall make inspection plans in advance. The
inspection plans shall include the basis, time, objects and items of the inspection.

    Administrative organs shall submit inspection plans to the departments appointed by the people’s governments
at the same level (hereinafter collectively referred to as appointed departments) for the record. The appointed departments shall
make necessary coordination on the inspection plans of the administrative organs concerned; if the plans may be merged, they shall
be merged; if the plans may be jointly implemented, the administrative organs concerned shall be organized to jointly conduct the
inspection.

    For an economic inspection on enterprises to be conducted by an administrative organ with vertical management
system, it shall submit the inspection plans to for the record. The organ at the next higher level shall make necessary coordination
on the inspection plans of the organ at the next lower level; if the plans may be merged, they shall be merged.

    Article 6  The same administrative organ shall not conduct economic inspection on the same enterprise more than one time each year,
except as otherwise provided by laws, administrative regulations and these Provisions.

    Article 7  When conducting economic inspection on enterprises by taxation organs, State taxation organs and local taxation organs
shall, in accordance with the principle of administrating separately and inspecting jointly, jointly organize the conduction of the
inspection according to the inspection plan; taxation organs at the province (autonomous region or municipality directly under the
Central Government) level, the municipality (prefecture, league) level, and the county (banner) level shall coordinate as a whole.
Taxation organs shall not conduct taxation inspect on the same enterprise for more than twice per year.

    Quality and technical supervision organs shall not conduct supervision and random check on product quality
of the same enterprise for more than twice per year, except those enterprises the product quality of which is not up to standard
in random check.

    For key and large State-owned enterprises into which inspection commissioners of the State Council have been
appointed, except as otherwise provided by laws and administrative regulations, the administrative organs concerned shall not conduct
finance inspection on these enterprises.

    Article 8  When conducting economic inspection on enterprises, administrative organs shall issue an inspection notice. The inspection
notice shall include the following contents:

    (1) laws and regulations on the basis of which the inspection is conducted;

    (2) inspection contents;

    (3) time limit for inspection;

    (4) staff and responsible persons conducting inspection.

    Article 9  After completion of the economic inspection on enterprises, administrative organs shall promptly provide objective, veritable
and explicit reports and submit them to appointed departments or departments at higher levels for the record. The appointed departments
or departments at higher levels shall, according to situations, send copies of the inspection reports to the administrative organs
concerned.

    If the inspection report of an administrative organ may meet the needs of any other administrative organs
in performing their functions and duties, the other administrative organs shall make use of the report to avoid repeated inspection.

    Article 10  Except the charging items prescribed by laws, regulations, the State Council, the Ministry of Finance, the State Development
and Planning Commission as well as the people’s governments of provinces, autonomous regions and municipalities directly under the
Central Government, when conducting economic inspection on enterprises, administrative organs shall not charge any fees, nor transfer
any inspection expenditures onto enterprises in any form.

    Article 11  When conducting economic inspection on an enterprise, administrative organ’s staff shall not receive gifts, remuneration
or fringe benefits from the inspected enterprise, nor apply for reimbursement in the inspected enterprise, nor join the junketing,
entertainment or tour activities of the inspected enterprise, nor seek profits for himself, his relatives or others through inspection.

    Article 12  If an administrative organ commits any one of the following acts, administrative sanctions shall be imposed upon the persons
in charge directly responsible and the other directly responsible:

    (1) to conduct economic inspection on enterprises without an inspection notice;

    (2) to conduct economic inspection on the same enterprise for more times than prescribed within one year;

    (3) to illegally charge fees from inspected enterprises or transfer inspection expenditures onto enterprises.

    Article 13  If the staff of an administrative organ commit any one of the following acts, the administrative sanctions of warming
or even dismissal shall be imposed:

    (1) in violation of the provisions, to conduct economic inspection on enterprises without authorization;

    (2) to receive gifts, remuneration or fringe benefits from inspected enterprises;

    (3) to apply for reimbursement in inspected enterprises;

    (4) to join junketing, entertainment or tour activities of inspected enterprises;

    (5) to seek profits for himself, his relatives or others through inspection.

    The gifts, remuneration or fringe benefits of inspected enterprises received by staff of an administrative
organs mentioned in the preceding paragraph shall be confiscated, pursued or ordered to return or compensate according to law; the
fees reimbursed in the inspected enterprises and the fees for junketing, entertainment or tour activities shall be returned, compensated,
or paid by themselves.

    Article 14  Enterprises are enpost_titled to reject any economic inspections conducted in violation of these Provisions, and any unit and
individual is enpost_titled to report to supervision departments and other relevant departments. The departments receiving the report
shall keep it confidential and handle it promptly.

    Article 15  The staff of administrative departments retaliating upon or framing up reporters shall be investigated for criminal responsibilities
if crimes are constituted; if no crimes are constituted, they shall be given administrative sanctions according to law.

    Article 16  Administrative organs are not restricted by Articles 4,5,6,7,8,9 of these Provisions if they have reasons to believe that
illegal activities or possibilities thereof exist in the enterprise.

    Article 17  Special inspections decided by the State Council, by the relevant departments of the State Council after State Council’s
approval, or by the people’s governments of provinces, autonomous regions or municipalities directly under the Central Government
shall be conducted respectively in accordance with the scopes, contents, time limits and procedures defined by the State Council
or the people’s governments of provinces, autonomous regions or municipalities directly under the Central Government.

    Article 18  The people’s governments of provinces, autonomous regions or municipalities directly under the Central Government may
formulate implementing measures according to these Provisions.

    Article 19  Inspections conducted by any other administrative organs shall be conducted by reference to these Provisions.

    Article 20  These Provisions take effect from the date of promulgation.





SUPPLEMENTARY CIRCULAR OF THE STATE ECONOMIC AND TRADE COMMISSION, THE MINISTRY OF FOREIGN TRADE AND ECONOMIC COOPERATION AND THE GENERAL ADMINISTRATION OF CUSTOMS ON ADJUSTING COMMODITY LISTS OF THE FIRST BATCH OF IMPORT PRODUCT OF PROCESSING TRADE IN RESTRICTION

The State Economic and Trade Commission, the Ministry of Foreign Trade and Economic Cooperation, the General Administration of Customs

Supplementary Circular of the State Economic and Trade Commission, the Ministry of Foreign Trade and Economic Cooperation and the
General Administration of Customs on Adjusting Commodity Lists of the First Batch of Import Product of Processing Trade in Restriction

GuoJingMaoMaoYi [1999] No.930

September 27, 1999

The Economic and Trade Commission and Foreign Trade Committee of the provinces, autonomous regions, municipalities directly under
the Central Government, municipalities separately listed on the State plan and production and construction crops of Xinjiang, Guangdong
branch of the General Administration Customs, customs directly under the General Administration of Customs and relevant departments
of State Council:

With a view to implementing the Circular of General Office of the State Council on Transmitting the Opinions of State Economic and
Trade Commission and Other Departments on Further Perfecting the Deposit Machine Account System of Processing Trade Bank (GuoBanFa
[1999] No.35), the Circular on Confirming Commodity Lists of the First Batch of Import Product of Processing Trade in Prohibition
and in Restriction (GuoJingMaoMaoYi [1999] No.490, hereinafter referred as Commodity Lists) was jointly promulgated by State Economic
and Trade Commission, the Ministry of Foreign Trade and Economic Cooperation and the General Administration of Customs. Now adjustment
to the numbers of heading of cotton cloth in the Commodity Lists has been made since October1, 1999. Attachment:Numbers of Heading Lists of Cotton Cloth in Restriction

Category of commodity Numbers of heading of commodity

Cotton cloth

Without bleach 52081100 52081200 52081300 52081900 52091100 52091200 52091900 52101100

Bleached 52082100 52082200 52082300 52082900 52092100 52092200 52092900 52102100

52102200 52102900 52112100 52112200 52112900 52121200 52122200



 
The State Economic and Trade Commission, the Ministry of Foreign Trade and Economic Cooperation, the General Administration
of Customs
1999-09-27

 






DECISION OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS ON AMENDMENT TO THE HIGHWAY LAW

Category  COMMUNICATIONS AND TRANSPORT Organ of Promulgation  The Standing Committee of the National People’s Congress Status of Effect  In Force
Date of Promulgation  1999-10-31 Effective Date  1999-10-31  


Decision of the Standing Committee of the National People’s Congress on amendment to the


Appendex: Highway Law of the People’s Republic of China (1999)
Contents
Chapter I  General Provisions
Chapter II  Highway Planning
Chapter III  Highway Construction
Chapter IV  Highway Maintenance
Chapter V  Highway Administration
Chapter VI  Toll Highways
Chapter VII  Supervision and Inspection
Chapter VIII  Legal Responsibility
Chapter IX  Supplementary Provision
APPENDIX:RELEVANT ARTICLES OF PENALTIES FOR VIOLATION OF PUBLIC SECURITY

(Adopted at the 12th Meeting of the Standing Committee of the Ninth

National People’s Congress on October 31, 1999 and promulgated by Order
No. 25 of the President of the People’s Republic of China on October 31, 1999)

    1. The 12th Meeting of the Standing Committee of the Ninth National
People’s Congress decided to make following amendment to the of the People’s Republic of China>:

    (1) The first paragraph of the Article 21 shall be amended as: ” Raising
funds for highway construction may ask for loan from domestic and foreign
financial organizations according to law, besides financial allocations
from people’s governments at various level including funds for specified
item of highway construction by raise through in accordance with law
collecting taxes turned to as allocations.”

    (2) Article 36 shall be amended as: ” State adopts the measure of
collecting taxes to raise funds for maintenance of highway according to law.
The specific measure of implementation and its steps shall be stipulated by
State Council.”

    “In accordance with law funds raised by collecting taxes for highway
maintenance must be used for specific item of maintaining and reconstructing
highway.”

    (3) Article 76 shall be deleted.

    In accordance with this decision the Republic of China> shall be amended correspondingly and repromulgated again
and effective as of the date of promulgation.

    2. The State Council shall abolish various unresonable fee collecting,
determine rational range of taxes collecting and adopt effective measure to
prevent from increasing of burden on peasant, at same time shall prevent from
increasing of burden on units who consuming oil not for vehicle, when
formulates the measure of implementation for changing fee collecting of
highway and vehicle to taxes collecting.

Appendex: Highway Law of the People’s Republic of China (1999)
(Adopted at the 26th Session of the Standing Committee of the Eighth
National People’s Congress on July 3, 1997 and revised according to the
Decision Concerning the Revision of the of China> adopted at the 12th Meeting of the Standing Committee of the Ninth
National People’s Congress on October 31, 1999)
Contents

    Chapter I     General Provisions

    Chapter II    Highway Planning

    Chapter III   Highway Construction

    Chapter IV    Highway Maintenance

    Chapter V     Highway Administration

    Chapter VI    Toll Highways

    Chapter VII   Supervision and Inspection

    Chapter VIII  Legal Responsibility

    Chapter IX    Supplementary Provisions

Chapter I  General Provisions

    Article 1  This Law is enacted with a view to enhancing highway
construction and administration, promoting the development of highways and
meeting the requirements of socialist modernization and people’s life.

    Article 2  This Law shall be applicable in engaging in highway planning,
construction, maintenance, operation, use and administration within the
territory of the People’s Republic of China.

   The highways referred to in this Law cover highway bridges, highway
tunnels and highway ferries.

    Article 3  Development of highways should follow the principle of overall planning, rational distribution, quality assurance, assurance
of unimpeded traffic, environmental protection and laying equal stress on
construction, transformation and maintenance.

    Article 4  People’s Governments at all levels should adopt strong
measures to foster and promote highway construction. Highway construction
should be integrated into the national socio-economic development plan.

    The State encourages and guides domestic and foreign economic
organizations to invest in highway construction and operations in accordance
with law.

    Article 5  The State assists and fosters national minority regions,
remote border regions and poor regions in the development of highway
construction.

    Article 6  Highways are classified as state highways, provincial highways,
county highways and village highways in accordance with their respective
status in the highway network, and are classified as expressways, grade-one
highways, grade-two highways, grade-three highways and grade-four highways
in accordance with technical grades. Specific classification standards shall
be worked out by the department of communications under the State Council.

    Construction of new highways should meet the requirements of technical
grades. Measures should be taken to gradually transform those previously
built highways outside the grades which fail to meet the requirements of the lowest technical grade into highways meeting the requirements
of technical grades.

    Article 7  Highways are under state protection. No unit or individual
shall destroy, damage or illegally occupy highways, land for highways and
ancillary facilities of highways.

    Every unit and individual have the obligation to care for highways, land
for highways and ancillary facilities of highways, have the right to report
and charge acts of destruction and damage of highways, land for highways,
ancillary facilities of highways and acts affecting highway safety.

    Article 8  The department of communications under the State Council
is in charge of the work related to highways throughout the country.

    The departments of communications of local People’s Governments above
the county level are in charge of the work related to highways within their
respective administrative areas; however, the duties and responsibilities of the departments of communications of local People’s
Governments above the
county level in the administration and supervision of state highways and
provincial highways shall be determined by the People’s Governments of the
provinces, autonomous regions and municipalities directly under the Central
Government.

    Village, national minority village and township People’s Governments
are responsibile for the construction and maintenance of village highways
within their respective administrative areas.

    The departments of communications of local People’s Governemnts above
the county level may decide that agencies of highway administration shall
perform their duties and responsibilities in highway administration in
accordance with the provisions of this Law.

    Article 9  All units and individuals shall be prohibited to establish
posts, collect toll, impose fines and intercept vehicles on highways.

    Article 10  The State encourages sci-tech research in the work related
to highways and shall give rewards to units and individuals that have
scored outstanding achievements in highway sci-tech research and applications.

    Article 11  Provisions for special-purpose highways in this Law apply to
special-purpose highways.

    Special-purpose highways mean the roads built, maintained and managed by
enterprises or other units which provide transport services exclusively or
mainly for those enterprises or units.
Chapter II  Highway Planning

    Article 12  Highway planning should be made in accordance with the
requirements of the national socio-economic development and national defense
buildup and in coordination with urban construction development planning and
development planning of other modes of communications and transport.

    Article 13  Land use planning for highway construction should be in line
with overall land use planning, and land used for construction of the year
should be integrated into annual land use plan for construction.

    Article 14  State highway planning shall be made by the department of communications under the State Council in conjunction with
the departments
concerned under the State Council and in consultation with the provinces,
autonomous regions and municipalities directly under the Central Government
along the state highways and shall be submitted to the State Council for
approval.

    Provincial highway planning shall be made by the departments of communications of the People’s Governments
of the provinces, autonomous
regions and municipalities directly under the Central Government in
conjunction with the departments concerned at the same level and in
consultation with the People’s Governments at the next lower level along
the provincial highways and shall be submitted to the People’s Governments
of the provinces, autonomous regions and municipalities under the Central
Governments for approval and submitted to the department of communications
under the State Council for the record.

    County highway planning shall be made by the departments of communications
of the People’s Governments at the county level in conjunction with the
departments concerned at the same level and shall be submitted to the
People’s Governments at the next higher level for approval upon examination
and finalization by the People’s Governments at the same level.

    Village highway planning shall be made by the village, national minority
village and township People’s Governments with the assistance of the
departments of communications of the People’s Governments at the county
level and shall be submitted to the People’s Governments at the county
level for approval.

    County highway and village highway planning approved as prescribed in
the third Paragraph and the fourth Paragraph should be submitted to the
departments of communications of the People’s Governments at the next
higher level of the approval organs for the record.

    Provincial highway planning should be in coordination with state highway
planning. County highway planning should be in coordination with provincial
highway planning. Village highway planning should be in coordination with
county highway planning.

    Article 15  Special-purpose highway planning shall be made by units
in charge of the special-purpose highways and shall be submitted to the
departments of communications of the People’s Governments above the county
level for examination and verification upon examination and finalization by
the competent departments at the next higher level.

    Special-purpose highway planning should be in coordination with highway
planning. Upon discovery of incoordination between special-purpose highway
planning and state highway, provincial highway, county highway and village
highway planning, the departments of communications of the People’s
Governments above the county level should put forth suggestions for revisions,
and the competent departments and units of the special-purpose highways
should make corresponding revisions.

    Article 16  Partial adjustments in state highway planning shall be
decided upon by the organs which originally made the plans. For state highway
planning which requires major revisions, the organs which originally made
the plans shall put forth schemes for revision to be submitted to the State
Council for approval.

    For approved provincial highway, county highway and village highway
planning that require revisions, the organs which originally made the plans
shall put forth schemes for revision to be submitted to the original approval
organs for approval.

    Article 17  Naming and numbering of state highways shall be determined
by the department of communications under the State Council; naming and
numbering of provincial highways, county highways and village highways
shall be determined by the departments of communications of the People’s
Governments of the provinces, autonomous regions and municipalities directly
under the Central Government in accordance with the relevant provisions of
the department of communications under the State Council.

    Article 18  In planning and building of new villages, townships and
development zones, the prescribed distance from the highways should be kept
and constructions should be avoided corresponding to either side of the
highways in order not to turn highways into streets and affect highway
operational safety and unimpeded traffic.

    Article 19  The State encourages the use of special-purpose highways
for public transport of society. The special-purpose highways when used
mainly for public transport of society, the competent unit of the special-
purpose highways or the sides concerned shall submit applications and the
special-purpose highway can be reclassified as provincial highway, county
highway or village highway with the consent of the competent unit of the
special-purpose highway and the approval of the department of communications
of the People’s Governments of the provinces, autonomous regions and
municipalities directly under the Central Government.
Chapter III  Highway Construction

    Article 20  Departments of communications of the People’s Governments
above the county level should, pursuant to their duties and responsibilities,
maintain order in highway construction and enhance supervision and
administration in highway construction.

    Article 21  Raising funds for highway construction may ask for loan from
domestic and foreign financial organizations according to law, besides
financial allocations from people’s governments at various level including
funds for specified item of highway construction by raise through in
accordance with law collecting taxes turned to as allocations.

    The State encourages investment by domestic and foreign economic
organizations in highway construction. Highway development and operating
companies may raise funds by issuing stocks and company bonds in accordance
with the provisions of laws and regulations.

    Revenue accrued from transfer of highway toll collection right in
accordance with the provisions of this Law must be used for highway
construction.

    Raising funds from enterprises and individuals for highway construction
must be based on requirements and possibilities, the principle of voluntarism
must be adhered to and there shall be no forcible apportionment, and must be
in line with the relevant provisions of the State Council.

    Funds for highway construction may also be raised in other ways which
are in line with the provisions of law or the State Council.

    Article 22  Highway construction should proceed in accordance with the
procedures of capital construction prescribed by the State and the relevant
provisions.

    Article 23  Highway construction projects should, pursuant to the
relevant provisions of the State, practise corporate responsibility system,
tender and bidding system and engineering supervision system.

    Article 24  Highway construction units should, in accordance with
the characteristics and technical requirements of highway construction
projects, select survey and design unit, construction unit and engineering
supervision unit with corresponding qualifications, and pursuant to the
provisions of relevant laws, rules and regulations and requirements of highway engineering technical standards, sign separate contracts
clearly
defining the rights and obligations of both sides.

    Feasibility study units, survey and design units, construction units
and engineering supervision units undertaking highway construction projects
must hold certifications of qualifications and quality prescribed by the
State.

    Article 25  Construction of highway construction projects must be
submitted to departments of communications of People’s Governments above
the county level for approval in accordance with the provisions of the
department of communications under the State Council.

    Article 26  Highway construction must conform to highway engineering
technical standards.

    Design units, construction units and engineering supervision units
undertaking highway construction projects should, pursuant to the relevant
provisions of the State, establish sound quality assurance system, practise
job responsibility system and carry out design, construction and supervision
in accordance with the relevant laws, rules and regulations as well as the
requirements of highway engineering technical standards and agreement in
the contracts to ensure the quality of highway engineering.

    Article 27  Land use for highway construction shall be processed
pursuant to the provisions of the relevant laws and regulations.

    Highway construction should implement the principle of earnestly
protecting cultivated land and economy in land use.

    Article 28  For requirements to use the state-owned barren mountains,
wasteland or requirements to dig sand, quarry and collect soil on the
state-owned barren mountains, wasteland, flood land and beach for highway
construction, when the formalities are completed pursuant to the provisions
of the relevant laws and regulations, no unit or individual shall obstruct
or illegally collect fees.

    Article 29  Local People’s Governments at all levels should render
support and assistance in highway construction land use and shifting of inhabitants according to law.

    Article 30  Design and construction of highway construction projects
should comply with the requirements for the protection of the environment,
protection of cultural relics and ancient sites and prevention of soil and
water loss in accordance with law.

    Highway construction projects in highway planning implementing national
defense requirements should carry out construction in strict accordance with
the plans to ensure the communications requirements of national defense.

    Article 31  When highway construction affects the normal use of railways,
water conservancy projects, electric and postal and telecommunications
facilities, the highway construction unit should seek the consent of the
departments concerned in advance; when highway construction causes damage
to the facilities concerned, the highway construction unit should repair
and restore the same in accordance with the technical standards not lower
than the original technical standards of the facilities, or give
corresponding financial compensation.

    Article 32  Construction units should install clear construction signs
and safety signs at either end of the construction sector of the road when
engaged in highway reconstruction. Signs should be installed at the
diversion entrance when vehicles are required to divert; temporary road
must be built to ensure the passage of vehicles and pedestrians when
impossible to divert.

    Article 33  Acceptance checks should be carried out in accordance with
the relevant provisions of the State upon completion of highway construction
projects and highway repair and restoration projects; those projects without
going through acceptance checks or those failing to pass acceptance checks
must not be handed over for use.

    Clear signs should be installed and lines marked on completed highways
in accordance with the provisions of the department of communications under
the State Council.

    Article 34  Local People’s Governments above the county level should
determine the land for highway use no less than one meter from the outer
fringe of the side trenchs(water trenches, slope-protection path at the
foot of slope, the same hereinafter) on either side of the highway.
Chapter IV  Highway Maintenance

    Article 35  Agencies of highway administration should conduct highway
maintenance in accordance with the technical specifications and operational
procedures prescribed by the department of communications under the State
Council to ensure the highways are constantly in a good technical state.

    Article 36  State adopts the measure of collecting taxes to raise funds
for maintenance of highway according to law. The specific measure of
implementation and its steps shall be stipulated by State Council.

    In accordance with law funds raised by collecting taxes for highway
maintenance must be used for specific item of maintaining and reconstructing
highway.

    Article 37  People’s Governments at the county level and the village
level should render support and assistance in sand digging, quarrying,
soil collection and water collection required for highway maintenance.

    Article 38  People’s Governments at the county level and the village
level should, within the scope of rural obligatory labor and in accordance
with the relevant provisions of the State, organize rural inhabitants on
either side of highways in fulfilling the obligations of providing services
for highway construction and maintenance.

    Article 39  To ensure the personal safety of highway maintenance
personnel, highway maintenance personnel should wear uniforms eith safety
signs on them when engaging in maintenance operations; visible operations
signs should be installed on highway operations vehicles when employing
vehicles in maintenance operations.

    Under the prerequisite of not adversely affecting the passage of passing
vehicles, highway maintenance vehicles in operation shall be subjected to
the restrictions of highway road signs and the marked lines in their route
and direction of driving; passing vehicles should pay attention to avoid
or yield to highway maintenance vehicles and personnel.

    When construction of highway maintenance project affects the passage of vehicles and pedestrians, construction
units should handle the matter in
accordance with the provisions of Article 32 of this Law.

    Article 40  Agencies of highway administration should repair and restore
in time the state highways and the provincial highways the traffic of which is
suspended due to serious natural disasters; when agencies of highway
administration find it difficult to repair and restore them in time, local
People’s Governments above the county level should organize the organs,
societies, enterprises, institutions and rural and township inhabitants
of the locality in time in emergency repair, and may request local army
units for support to resume the traffic as quickly as possible.

    Article 41  Agencies of highway administration shall be responsible for
the soil and water conservation of the slopes and wasteland within the range
of land for highway use.

    Article 42  Planting of trees along highways shall be organized and
carried out by agencies of highway administration in accordance with highway
engineering technical standards.

    Trees on land for highway use must not be felled at will; for those trees
which need to be felled for renewal, formalities for examination and approval
in accordance with the provisions of the Republic of China> should be completed upon the consent of the department
of communications of the local People’s Government above the county level
and the task of supplementary planting for renewal fulfilled.
Chapter V  Highway Administration

    Article 43  Local People’s Governments at all levels should take measures
to step up highway protection.

    Departments of communications of local People’s Governments above the
county level should conscientiously perform their duties and responsibilities,
conduct the work of highway protection successfully according to law and
strive to adopt scientific management methods and advanced technical means
to improve highway management level, gradually perfect highway services
facilities and ensure that highways are in perfect condition, safe and
unimpeded in traffic.

    Article 44  No unit or individual shall occupy and dig highways without
authorization.

    For necessities to occupy, dig highways or reroute highways because of construction of railways, airports,
power stations, telecommunications
facilities, water conservancy projects and other construction projects,
the construction units should obtain the consent of the departments of communications concerned in advance; for those affecting communications
safety, consent has also to be obtained from the public security organs
concerned. For occupation, digging of highways or rerouting of highways,
the construction units should repair, restore, reconstruct the sector of the highway according to the technical standards not lower
than the
original technical standards or give corresponding financial compensation.

    Article 45  Construction of bridges or aqueducts or erection and laying
of wires or pipes and other facilities over or across highways, as well as
erection or laying of wires or pipes and cables and other facilities should
obtain the consent of the department of communications concerned in advance,
and for those affecting communications safety, consent has also to be obtained
from the public security organ concerned; the facilities to be constructed,
erected or laid should comply with the requirements of highway engineering
technical standards. For those causing damage to highways, compensation
should be given according to the extent of the damage.

    Article 46  No unit or individual shall set up stalls or sales points,
pile up goods, dump garbage, put up obstacles, dig trenches to draw water or
use the side trenches of highways to drain sewage or engage in other
activities damaging, polluting highways and affecting unimpeded traffic of highways.

    Article 47  No sand digging, quarrying, soil collection, waste dumping,
nor explosion operations and other activities endangering the safety of highways, highway bridges, highway tunnels and highway ferries
shall be
conducted within the range of 200 meters around big- and medium-size
highway bridges and ferries, within the range of 100 meters above highway
tunnels and from tunnel entrances as well as within a certain distance
within either side of highways.

    For construction of dykes and dams, shrinkage or expansion of river beds
necessitated by rushing to deal with an emergency or flood prevention
within the range of the preceding paragraph, submission of report should be
made in advance to the departments of communications of People’s Governments
of the provinces, autonomous regions and municipalities directly under the
Central Government for approval in conjunction with the departments of water
administration, and effective measures taken to protect the security of the
highways, highway bridges, highway tunnels and highway ferries in question.

    Article 48  Except for agricultural machinery which need to drive for
a short distance on highways for local field operations, no iron-wheel
vehicles, tracked vehicles and other machinery which may dama

ANNOUNCEMENT OF THE GENERAL ADMINISTRATION OF CUSTOMS ON THE PARTIAL ADJUSTMENT OF THE EVALUATION STANDARDS FOR ENTERPRISE CLASSIFICATION

The General Administration of Customs

Announcement of the General Administration of Customs on the Partial Adjustment of the Evaluation Standards for Enterprise Classification

Announcement of the General Administration of Customs

December 20, 1999

The circular of the General Administration of Customs on the partial adjustment of the evaluation standards for enterprise classification
as of January 1, 2000 has been received. The content adjusted is announced as follows:

I.

Relevant customs shall not apply the deposit account systems for processing trade to enterprises that meet the conditions set in Article
29 of the Detailed Rules for the Implementation of the Measures of the Customs of the People’s Republic of China on Classified Enterprise
Administration.

Relevant customs shall apply the shadow deposit account system for processing trade to enterprises in the processing trade to which
A administration is applied according to Article 6 of the Measures of the Customs of the People’s Republic of China on Classified
Enterprise Administration, nor are there any deposit requirements for their import of goods under import restrictions.

The standards stipulated in the relevant documents shall be strictly observed while the evaluation of enterprises to which A administration
shall be applied being conducted. At the same time, the enterprises should be administrated dynamically. Customs shall make timely
adjustment of the administrative type upon discovery of enterprises’ involvement in the illegal practice of smuggling.

II.

The fine imposed on enterprises for their rule-violating practices shall not exceed RMB ￿￿10, 000, and shall not be entered into the
evaluation record of enterprises to which C administration is applied.

III.

If an enterprise’s rule-violating practices number two or more within one year, but still not surpassing 1￿￿f the number of declarations
it made at the Customs the year before, C administration shall still not be applied.

IV.

Unlawful practices occurring after January 1, 1999 shall be entered into the evaluation records of enterprise to which C administration
is applied.



 
The General Administration of Customs
1999-12-20

 






INTERIM PROVISIONS ON IMPOSING ADMINISTRATIVE OR DISCIPLINARY PUNISHMENTS ON CHEATED OR ILLEGAL PURCHASE, EVASION AND ILLEGAL BUYING AND SELLING OF FOREIGN EXCHANGE AND OTHER PRACTICES IN VIOLATION OF FOREIGN EXCHANGE CONTROL REGULATIONS

Category  BANKING Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1999-01-25 Effective Date  1999-01-25  


Interim Provisions on Imposing Administrative or Disciplinary Punishments on Cheated or Illegal Purchase, Evasion and Illegal Buying
and Selling of Foreign Exchange and Other Practices in Violation of Foreign Exchange Control Regulations



(Approved by the State Council on December 16, 1998, promulgated by Decree No. 7 of  the Ministry of Supervision, the Ministry of Personnel, the People’s Bank of China, the General Administration of Customs
and the State Administration of Foreign Exchange on January 25, 1999)

    Article 1  These Provisions are formulated according to the Regulations of the People’s Republic of China on Foreign Exchange Administration,
the Interim Regulations on State Functionaries, and the Regulations on Awarding and Punishing Enterprise Staff in order to maintain
the order of control over foreign exchange, punish acts in violation of foreign exchange control regulations and avoid financial
risks.

    Article 2  These Provisions are applied to State functionaries and working staff of financial organs which have been approved to
operate foreign exchange business and of State-owned foreign economy and trade enterprises.

    Financial organs which have been approved to operate foreign exchange business mentioned in these Provisions
refer to Chinese-funded banks, non-bank financial organs and their branches which have been approved to operate foreign exchange
business.

    The State-owned foreign economy and trade enterprises mentioned in these Provisions refer to State-owned foreign
trade companies, State-owned production enterprises which operate export and import, State-owned enterprises with operating rights
of export and import and enterprises which State property holds a dominant share or occupies a leading place.

    Article 3  Where an act in violation of foreign exchange control regulations listed in these Provisions is committed, in addition
to administrative penalties, administrative or disciplinary punishments shall be imposed upon the responsible persons concerned according
to these Provisions; where a crime is constituted, criminal liability shall be investigated according to law.

    Article 4  Working staff of financial organs which have been approved to operate foreign exchange business and of State-owned foreign
economy and trade enterprises committing any one of the following acts of cheated purchase of foreign exchange, where the sum of
which is not more than 100,000 US Dollars, shall be imposed the punishment of keeping on employment but placing under surveillance;
where the sum of which is more than 100,000 US Dollars, they shall be imposed the punishment of dismissal.

    (1) to forge or alter vouchers and documents such as the Customs declaration sheet, import certificate, verification
certificate of foreign exchange control departments, etc.;

    (2) to use, buy or sell forged or altered vouchers and documents such as the Customs declaration sheet, import
certificate, verification certificate of foreign exchange control departments, etc.;

    (3) to repeatedly use vouchers and documents such as the Customs declaration sheet, import certificate, verification
certificate of foreign exchange control departments, etc.;

    (4) to provide capital in RMB or other services which, they clearly know, are to be used for cheated purchase
of foreign exchange;

    (5) to fraudulently purchase foreign exchange by other means.

    If a unit commits any one of the acts mentioned in the preceding paragraph, the persons in charge directly
responsible and the other responsible persons shall be given disciplinary punishments according to the provisions of the preceding
paragraph.

    Article 5  Working staff of financial organs which have been approved to operate foreign exchange business and of State-owned foreign
economy and trade enterprises committing any one of the following acts of illegal purchase of foreign exchange, where the sum of
which is not more than 100,000 US Dollars, shall be imposed the punishment of warning, record of demerit or record of heavy demerit;
where the sum of which is not less than 100,000 US Dollars nor more than 1,000,000 US Dollars, they shall be imposed the punishment
of demotion or dismissal from post; where the sun of which is more than 1,000,000 US Dollars, they shall be imposed the punishment
of keeping on employment but placing under surveillance or of dismissal.

    (1) in violation the provisions of the State, to pay in RMB or reimburse in kind the money for imported goods
or other similar   payment which ought to be paid in foreign exchange, however, legal bartering trade shall not be included;

    (2) to pay in RMB for other persons’ expenditure incurred within China while receive their foreign exchange;

    (3) to provide capital in RMB or other services which, they clearly know, are to be used for illegal purchase
of foreign exchange;

    (4) to illegally purchase foreign exchange by other means.

    If a unit commits any one of the acts mentioned in the preceding paragraph, the persons in charge directly
responsible and the other responsible persons shall be given disciplinary punishments according to the provisions of the preceding
paragraph.

    Article 6  Working staff of financial organs which have been approved to operate foreign exchange business and of State-owned foreign
economy and trade enterprises committing any one of the following acts of evasion of foreign exchange, where the sum of which is
not more than 100,000 US Dollars, shall be imposed the punishment of dismissal form post; where the sum of which is not less than
100,000 US Dollars nor more than 1,000,000 US Dollars, they shall be imposed the punishment of keeping on employment but placing
under surveillance; where the sun of which is more than 1,000,000 US Dollars, they shall be imposed the punishment of dismissal.

    (1) in violation of the provisions of the State, to deposit foreign exchange outside China;

    (2) not to sell foreign exchange to designated foreign exchange banks according to the provisions of the State;

    (3) in violation of the provisions of the State, to remit or send foreign exchange outside China;

    (4) without approval of foreign exchange control departments, to arbitrarily carry or send foreign exchange
deposit certificate or foreign exchange negotiable securities outside China;

    (5) to provide capital in RMB or other services which, they clearly know, are to be used for evasion of foreign
exchange;

    (6) to evade foreign exchange by other means.

    If a unit commits any one of the acts mentioned in the preceding paragraph, the persons in charge directly
responsible and the other responsible persons shall be given disciplinary punishments according to the provisions of the preceding
paragraph.

    Article 7  Where working staff of financial organs which have been approved to operate foreign exchange business and of State-owned
foreign economy and trade enterprises, for a purpose of making profit, illegally buy or sell foreign exchange outside exchange places
prescribed by the State, the punishment of dismissal from post shall be imposed upon them if the sum involved is not more than 50,000
US Dollars or the illegal income is not more than 10,000 RMB yuan; if the sum involved is not less than 50,000 US Dollars nor more
than 100,000 US Dollars or the illegal income is not less than 10,000 RMB yuan nor more than 30,000 RMB yuan, the punishment of keeping
on employment but placing under surveillance shall be imposed; if the sum involved is not less than 100,000 US Dollars or the illegal
income is not less than 30,000 RMB yuan; the punishment of dismissal shall be imposed.

    If a unit commits any one of the acts mentioned in the preceding paragraph, the persons in charge directly
responsible and the other responsible persons shall be given disciplinary punishments according to the provisions of the preceding
paragraph.

    Article 8  If a State-owned foreign economy and trade enterprise causes other people to fraudulently purchase foreign exchange or
to illegally purchase foreign exchange because of its defects when operating import business as an agent, the persons in charge directly
responsible and the other directly responsible persons shall be imposed disciplinary punishments; if the sum involved is not more
than 100,000 US Dollars, they shall be imposed the punishment of warning, record of demerit or record of heavy demerit; if the sum
involved is more than 100,000 US Dollars but less than 1 million US Dollars, they shall be imposed the punishment of demotion or
dismissal form post; if the sum involved is more than 1 million US Dollars, they shall be imposed the punishment of keeping on employment
but placing under surveillance or of dismissal.

    Article 9  If a financial organ which has been approved to operate foreign exchange business causes other people to fraudulently
purchase, illegally purchase or evade foreign exchange because of its defects when settling exchanges, selling or paying foreign
exchange or opening accounts, the persons in charge directly responsible and the other directly responsible persons shall be imposed
disciplinary punishments; if the sum involved is not more than 100,000 US Dollars, they shall be imposed the punishment of warning,
record of demerit or record of heavy demerit; if the sum involved is more than 100,000 US Dollars but less than 1 million US Dollars,
they shall be imposed the punishment of demotion or dismissal form post; if the sum involved is more than 1 million US Dollars, they
shall be imposed the punishment of keeping on employment but placing under surveillance or of dismissal.

    Article 10  Where any State functionaries commit the any one of the acts of cheated or illegal purchase, evasion and illegal buying
and selling of foreign exchange and other practices in violation of foreign exchange control regulations, the punishment of demotion,
dismissal form post or dismissal shall be imposed.

    Article 11  If any State functionaries of the Customs or the foreign exchange control departments collude with persons who fraudulently
purchase, illegally purchase, evade or illegally buy or sell foreign exchange, and provide facilities to them, or provide service
to them even clearly knowing that the vouchers or documents are forged or altered, or cause other persons to fraudulently purchase,
illegally purchase, or evade foreign exchange because of their abuse of powers or practice of favoritism, the punishment of dismissal
shall be imposed.

    If any State functionaries of the Customs or the foreign exchange control departments cause other persons
to fraudulently purchase, illegally purchase, or evade foreign exchange because of their neglect of their duties, the punishment
of demotion or dismissal for post shall be imposed, if the circumstances are serious, the punishment of dismissal shall be imposed.

    Article 12  The persons in charge directly responsible shall be imposed the punishment of warning, record of demerit or record of
heavy demerit if they fail to stop or investigate and punish the acts in violation of foreign exchange control regulations happened
in their unit if the circumstances are relatively serious; if the circumstances are serious, the punishment of demotion or dismissal
form post shall be imposed.

    Article 13  It any State functionaries make advantage of their powers to shield acts in violation of foreign exchange control regulations
or commit any other acts hindering the supervision and check over law enforcement of foreign exchange control, the punishment of
dismissal for post or dismissal shall be imposed.

    If any working staff of financial organs which have been approved to operate foreign exchange business and
State-owned foreign economy and trade enterprises commit the acts prescribed in the preceding paragraph, the punishment of keeping
on employment but placing under surveillance or dismissal shall be imposed.

    If a unit commits the acts prescribed in the first paragraph of this Article, the persons in charge directly
responsible and the other directly responsible persons shall be respectively imposed administrative or disciplinary punishment according
to the provisions of the preceding two paragraphs.

    Article 14  Where persons who confess on their own initiative their acts in violation of foreign exchange control regulations and
return the foreign exchange and illegal income, or take measures on their own initiative to avoid losses, or make meritorious contributions,
the administrative or disciplinary punishment imposed on them may be lightened, reduced, or exempted.

    Where persons conceal the truth of facts, or produce false evidence by playing tricks, or hide or destroy
evidence, or refuse to provide the relevant documents, materials or certifying papers, the administrative or disciplinary punishment
shall be imposed in a heavier way or with severity.

    Article 15 If State-owned institutions independently operating import and export business and their working staff commit acts in violation of
foreign exchange control regulations prescribed in these Provisions, they shall be punished by reference to these Provisions.

    Article 16  These Provisions take effect as of the date of promulgation. These Provisions are applicable to the acts in violation
of foreign exchange control regulations which were committed after the effectiveness of the Regulations of the People’s Republic
of China on Foreign Exchange Control on April 1, 1996 and before the effectiveness of these Provisions but have not been handled.





CIRCULAR OF THE GENERAL ADMINISTRATION OF CUSTOMS, THE MINISTRY OF FOREIGN TRADE AND ECONOMIC COOPERATION, THE STATE ECONOMIC AND TRADE COMMISSION ON PRINTING AND ISSUING MEASURES OF THE CUSTOMS FOR ADOPTING CLASSIFIED ADMINISTRATION OVER ENTERPRISES

The General Administration of Customs, the Ministry of Foreign Trade and Economic Cooperation, the State Economic and Trade Commission

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

No.71

The “Measures of the Customs of the People’s Republic of China for Adopting Classified Administration over Enterprises” is hereby
promulgated and shall come into force on June 1,1999.

The “Administration Measures of the Customs of the People’s Republic of China for Creditable Enterprises” which was implemented by
the General Administration of Customs on May 1,1988 is repealed simultaneously.

Minister of the General Administration of Customs Qian Guanlin

March 31 1999

Circular of the General Administration of Customs, the Ministry of Foreign Trade and Economic Cooperation, the State Economic and
Trade Commission on Printing and Issuing Measures of the Customs for Adopting Classified Administration over Enterprises

Shu Jian [1999] No.240

The Sub-Administration of Customs of Guangdong, the customs offices, each province, autonomous region and municipality directly under
the Central Government, and the Foreign Economic Relations & Trade Commission of cities specifically designed in the state plan,
Economic and Trade Commission (the Planning Commission, Planning and Economic Commission):

In order to promote the self-discipline and law-abidance of the enterprises, increase superintendent and administration of customs
efficiency, the General Administration of Customs, the Ministry of Foreign Trade and Economic Cooperation, the State Economic and
Trade Commission established Measures of the Customs for Adopting Classified Administration over Enterprises Order (hereinafter referred
to as ” Measures “) to league together, are hereby on printing and issuing to you. Please to promulgate as No.71 order of the General
Administration of Customs and shall come into force as of the day of June 1,1999. Now we hereby give our notice as follows regarding
relevant matters:

1.

The customs in charge mentioned in the Measures refer to the customs directly under the Customs General Administration. As the classified
management of enterprises involves wide and comprehensive work strongly, the various customs must strengthen organization and leadership
and establish a mechanism of common management on enterprises among the customs. The competent heads of various customs are required
to be responsible for setting up Committee of Classified Management of Enterprises at customs’ level and treating with important
issues. The daily implementation works are under the centralized management by specialized departments that are responsible for enterprise
registration management. The scope of its responsibility as follows:

(1)

Accepting and dealing with the application of the enterprises, examining relevant documents and materials submitted by enterprises.

(2)

Offer name list of enterprises which are applicable to be under management of Category A or Category D, will be submitted to the Customs
General Administration after the examination by the Committee of Classified Management of Enterprises of respective customs.

(3)

The name list of enterprises that are applicable to be under the management of Category B or Category C will be examined and approved,
and organize the implementation in respective customs’ region.

(4)

Regulating related work of various functional departments in a centralized way, collect feedback opinion and maintain database of
enterprises in respective customs’ region.

(5)

Setting up contact system with such related departments as Foreign Trade and Economic Cooperation, Economic and Trade Commissions,
Taxation, Industry and Commerce, and Foreign Exchange so as to communicate and share information with each other.

2.

The appraisal of classified enterprises undertaking processing trade shall be taken in common by enterprise administration departments
and competent authorities responsible for processing trade.

3.

The Measures emphasizes the dynamic classified management of enterprises. Therefore, various functional departments are required to
strengthen coordination in them so as to ensure the specific records such as record of bill examination, record of check, record
of tax payment,

record of verification and writing off, record of verification, and record of investigation kept by various sectors concerned to be
send back timely to the centralized management departments. Those smuggling or laws-violation enterprises shall be put into adjusted
category of

classified management as the occasion demands.

4.

Related regulations of Notice of Law Basis for Administrative Punishment Implemented on Units and Declarants without Taking Annual
Examination (Shufa [1996] No. 1021) and Inspection Regulation of the Customs of the People’s Republic of China promulgated by the
Customs

General Administration will be followed in implementing Suspend Enterprise Qualification for Customs Declaration or Cancel Enterprise
Qualification for Customs declaration, the 3rd and 4th sections of the article 15 of this Measures.

5.

In order to perfect classified management of enterprises, the Customs General Administration will set up the Committee of Classified
Management of Enterprises attended by relevant professional departments. On how the name list of Category A and D will be submitted
to the

Customs General Administration and how to implement the Measures in all the Customs’ regions, another operational provisions will
be drawn up and promulgated by Supervision and Administration Department and Customs-clearing Department of the Customs General Administration.
The annual import and export volume stipulated in Article 6 of the Measures shall take Customs’ statistics as standard.

6.

The former Inspection Department of the Customs General Administration and Research Institute of Social Science jointly designed the
Questionnaire of Enterprise’s Situation (see the appendix) and develop in complement System on Examining and Approving Classified
Enterprise which has been put into use in some Customs. Thus, various customs may use this system for reference to examine and approve
enterprises that are applicable to be under management of Category A that may be operated in a may of combination of human beings
and machines. Meanwhile, the Customs General Administration shall make this system further perfectly.

Those customs without drawing the system software shall apply for it from Supervision and Administration Department of the Customs
General Administration as soon as possible.

7.

In order to play role in guiding enterprises to abide by laws in operation and promote enterprises in self-warning and self-discipline,
various customs shall be diligent and responsible in appraisal and examination work, execute the standard of the Measures strictly
and operate the work in a realistic way.

8.

All the former measures of classified management of enterprises formulated by various customs shall be terminated in operation as
of the day when the Measures are come into force.

9.

The work on classified management of enterprises is in need of the supports and assistances from relevant departments. All customs
shall strengthen contact and cooperation with foreign trade and economic departments, and the opinions of relevant competent departments

such as foreign trade shall be heard and economic cooperation, economic and trade commission, tax, foreign exchange administration,
departments of industry and commerce, and banks so as to do a good job with concerted efforts.

The measures mentioned on above shall be implemented accordingly. In case there comes any problems in its implementation, please report
in time.

Appendix 1: Measures of the Customs General Administration of the People’s Republic of China on Performing Classified Management of
Enterprises

Appendix 2: Questionnaire on the Situation of Imported and Exported Enterprises (Omitted)

Appendix 1:Measures of the Customs of the People’s Republic of China for Adopting Classified Administration over Enterprises

Article 1

These Measures are formulated in accordance with the Customs Law of the People’s Republic of China and other relevant laws and regulations
and in order to facilitate the lawful import and export of goods of the enterprises, promote the self-discipline and law-abidance
of the enterprises and effectively operate the Customs’ administration.

Article 2

“Enterprises” mentioned in these Measures shall be the enterprises and units directly involved in import and export activities, including:
enterprises with foreign investment, foreign trade companies, commercial materials enterprises having the import and export right,
production enterprises and scientific research academies and institutes having the self-operating import and export right, processing
trade operating units and processing deal enterprises, enterprises engaging in bonded warehousing operations, enterprises using or
dealing in tax-reduced or exempted import goods, enterprises engaging in Customs declaration services, enterprises transporting goods
under Customs control, enterprises having warehouses for goods under Customs control, units dealing in duty-free foreign exchange
commodities and other enterprises directly involved in import and export activities as stipulated by the General Administration of
Customs.

Article 3

In accordance with the enterprises’ operation and management situations, Customs declaration conditions and abidance of Customs law
and regulations, the Customs introduces A, B, C and D administration classes and shall adopt the dynamic classified administration
over the enterprises.

Article 4

The administration classes applicable to the enterprises shall be examined and determined by the competent Customs offices in the
places where the enterprises are located respectively. Of them, the list of the enterprises under A-or D-class administration shall
be submitted to the General Administration of Customs for the record. The General Administration of Customs shall send a copy of
the list of the enterprises under A-class administration to the Ministry of Foreign Trade and Economic Cooperation.

Article 5

The B-or C-class administration shall be organized and adopted by the competent Customs offices within their respective Customs areas.
The A-or D-class administration shall be organized and adopted by the General Administration of Customs within all Customs areas
throughout the country.

Article 6

If an enterprise meets the following requirements, the competent Customs office shall, according to the application by the enterprise
and upon examination and approval by the Customs, adopt A-class administration over the enterprise. If a foreign trade company has
its annual import and export volume at or more than US$30 million or its annual export volume at or more than US$20 million or a
production enterprise has its self-operated export volume at or more than US$10 million (its self-operated export volume of mechanical
and electronic products at or more than US$5 million), it may be considered in priority.

(1)

It has been registered for two years or more, and

1.

It has no record of smuggling or irregularities for two consecutive years;

2.

It has no record of default of Customs duty for two consecutive years;

3.

Its processing trade contracts have been verified and written off on time for two consecutive years; and

4.

It has no record of unauthentic declaration within two years after the inspection exemption agreement for the commodities that must
be inspected by the Customs office is signed;

(2)

The documents and certificates submitted by it to the Customs are authentic, complete and valid;

(3)

It has normal import and export business operations;

(4)

Its accounting system is perfect: sound financial and accounting books, reasonable account items and authentic and feasible business
records;

(5)

It has appointed special persons responsible for Customs matters;

(6)

The error rate of its Customs declaration forms is below 5% for two consecutive years; and

(7)

If an enterprise has the warehouses for storing the goods under Customs control, its warehouse management system is sound, its warehouse
detail accounts are clear, its warehouse-in and warehouse-out slips (including materials acquisition slips) are specially controlled,
and its account records are consistent with its goods.

Article 7

When an enterprise applies for A-class administration to the Customs, it shall submit a written application to the competent Customs
office. If an enterprise resorts to deception or files a unauthentic application, the Customs shall not accept its application for
A-class administration within two years. In submitting the written application, the enterprise shall submit the following documents
in two copies simultaneously:

(1)

Duplicate copy or photocopy of the valid document approving its business issued by the competent department of foreign trade and economic
cooperation or by any other competent department;

(2)

Annual enterprise examination certificate;

(3)

Self-appraisal report of the enterprise against the requirements listed in Article 6 of these Measures;

(4)

Enterprise Survey Form signed by the legal representative or his authorized representative of the enterprise and affixed with its
official seal; and

(5)

Written comments issued by the competent department of foreign trade and economic cooperation in the place where the enterprise is
registered.

Article 8

The Customs shall strictly examine the relevant documents and archive materials submitted by the enterprises, shall make the examination
according to their actual Customs passage, shall approve the enterprises if they meet the requirements and shall notify the enterprises
within 30 days.

Article 9

If an enterprise has any of the following circumstances, the Customs shall adopt C-class administration over it:

(1)

It has irregularities twice in one year or dodges or evades the duty payable totaling more than 50,000 Yuan Renminbi but less than
500,000 Yuan Renminbi;

(2)

It defaults the Customs duty totaling less than 1 million Yuan Renminbi;

(3)

Its management of accounting books is poor or its accounting books and documents fail to truthfully and effectively reflect its import
and export business operations;

(4)

It loses important business documents or refuses to provide relevant books and materials, thus causing the impossibility of Customs
control;

(5)

It fails to fulfill the verification and writing -off formalities for processing trade contracts according to the provisions;

(6)

The error rate of its Customs declaration forms is more than 10% in one year;

(7)

It lends the enterprise’s name to others for the purpose of Customs declaration and tax payment for import and export goods; or

(8)

It has been given such administrative penalties as criticism through circulation of a public notice or warning by the competent department
of foreign trade and economic cooperation in its export and import business activities.

Article 10

If an enterprise has any of the following circumstances, the Customs shall adopt D-class administration over it:

(1)

It dodges or evades the duty payable through smuggling totaling more than 500,000 Yuan Renminbi within two years (the accumulated
amount if several smuggling activities are involved);

(2)

It forges or alters the import or export license or document of approval;

(3)

It smuggles in goods or articles that are prohibited for import or export by the State;

(4)

It defaults the Customs duty totaling more than 1 million Yuan Renminbi;

(5)

It cheats for tax preference for the processing trade through the means of false manual, false Customs declaration form or false document
of approval;

(6)

It creates hidden layers or hidden containers in the means of transport used for carrying the goods under Customs control;

(7)

It has been suspended or revoked of its foreign trade operation license by the competent department of foreign trade and economic
cooperation; or

(8)

It has committed a crime of smuggling and has been investigated for criminal responsibility according to law by the judicial organ.

Article 11

If an enterprise is found through examination as not to meet the requirements for A-class administration but does not have the circumstances
listed in Articles 9 and 10 of these Measures, the Customs shall adopt B-class administration over it.

Article 12

The name list of the enterprises under A-class administration shall be issued by the General Administration of Customs to all Customs
offices for implementation, and on the basis of implementation of the regular administration system, the following facilities shall
be provided:

(1)

Special counters shall be set up at the Customs business sites and the priority facility shall be given to the goods declaration,
inspection and release formalities; and at the request of the enterprises, the priority “door-to-door” inspection for the goods shall
be carried out.

(2)

With approval of the General Administration of Customs, Customs officers may be sent to the factories for control or the computerized
administration may be adopted for the enterprises engaging in processing trade. Unless the State provides otherwise, the system of
bank guarantee deposit account shall not be required.

(3)

For the goods for which guarantee is permitted according to the provisions, the Customs shall inspect and release them according to
the letter of guarantee submitted by the enterprises and shall not require the money of guarantee.

(4)

The samples for inspection are not required for the commodities in the catalogue of commodities that must be inspected by the Customs
for the enterprise’s import.

(5)

The facilities for the enterprises in offering the EDI Customs declaration shall be provided.

(6)

The production enterprises and research academies and institutes having the self-operating import and export right may apply to the
Ministry of Foreign Trade and Economic Cooperation for the establishment of import and export companies, and the Customs shall give
priority to them in completing the Customs declaration registration formalities.

Article 13

The Customs shall adopt the regular administration system over the enterprises to which B-class administration is applicable.

Article 14

The Customs shall impose the key control on enterprises to which C-class administration is applicable, including the following measures:

(1)

The money of guarantee must be paid for the goods for which guarantee is permitted according to the provisions;

(2)

The money of guarantee must be paid according to the set rate in applying for the record of the processing trade contract;

(3)

Their business activities shall be put into key auditing and inspection;

(4)

Key inspection shall be imposed on their import and export goods;

(5)

Their application for Customs declaration and the record at places other their locations shall not be allowed; and

(6)

Relevant information shall be reported to the State Economic and Trade and Commission and the Ministry of Foreign Trade and Economic
Cooperation.

Article 15

The Customs shall adopt the following measures over the enterprises to which D-class administration is applicable:

(1)

The record for new processing trade contracts shall not be allowed;

(2)

Import and export goods shall be inspected one-by-one according to the declaration forms;

(3)

According to the relevant provisions, the enterprise’s qualifications of Customs declaration, the enterprise’s qualifications for
transporting goods under Customs control or the enterprise’s qualifications for bonded warehousing business shall be temporarily
suspended.

(4)

If the circumstances are serious, the enterprise’s qualifications for Customs declaration, the enterprise’s qualifications for transporting
goods under Customs control or the enterprise’s qualifications for bonded warehousing business shall be deprived of according to
the relevant provisions; and

(5)

Relevant information shall be reported to the State Economic and Trade Commission and the Ministry of Foreign Trade and Economic Cooperation.
The Ministry of Foreign Trade and Economic Cooperation or its authorized competent department of foreign trade and economic cooperation
at the provincial level shall give administrative penalties to the enterprise according to the Interim Provisions on Imposition of
Administrative Penalties as Warnings or Suspension or Revocation of the Operation License in Foreign Trade or International Cargo
Agency on the Enterprises Committing Irregularities or Smuggling Activities.

Article 16

The Customs shall adopt the dynamic classified administration over the enterprises. Once an enterprise is found to have any of the
circumstances listed in Articles 9 and 10 of these Measures, the Customs shall immediately make corresponding adjustment in the administration
class applicable to the enterprise, and shall adopt C-or D-class administration over it. Of them, if A-class administration is applicable
to the enterprise prior to the adjustment, the competent Customs office shall inform the enterprise that it does not adopt A-class
administration, and shall report the adjustment result to the General Administration of Customs within seven days. The General Administration
of Customs shall notify all Customs offices throughout the country, and at the same time, shall send a copy of the adjustment result
to the Ministry of Foreign Trade and Economic Cooperation.

Article 17

If an enterprise to which D-class administration is applicable does not have any of the circumstances listed in Article 10 of these
Measures within two years, the Customs shall adopt C-class administration over it; if an enterprise to which C-class administration
is applicable does not have any of the circumstances listed in Articles 9 and 10 of these Measures within one year, the Customs shall
adopt B-class administration over it.

Article 18

The General Administration of Customs shall be responsible for the interpretation of these Measures.

Article 19

These Measures shall go into effect as of June 1,1999. The Measures for Administration of Trustworthy Enterprises by the Customs of
the People’s Republic of China became effective as of May 1,1988 shall be repealed simultaneously.



 
The General Administration of Customs, the Ministry of Foreign Trade and Economic Cooperation, the State Economic and
Trade Commission
1999-03-31

 






CIRCULAR OF THE GENERAL OFFICE OF THE STATE COUNCIL ON ISSUING THE PROPOSALS OF THE STATE ECONOMIC AND TRADE COMMISSION AND OTHER DEPARTMENTS ON FURTHER IMPROVING THE BANK GUARANTEE ACCOUNT SYSTEM FOR PROCESSING TRADE

Category  FOREIGN TRADE Organ of Promulgation  The General Office of the State Council Status of Effect  In Force
Date of Promulgation  1999-04-05 Effective Date  1999-06-01  


Circular of the General Office of the State Council on Issuing the Proposals of the State Economic and Trade Commission and Other
Departments on Further Improving the Bank Guarantee Account System for Processing Trade


Appendix: Proposals on Further Improving the Bank Guarantee Account

(Promulgated by Document No. [1999] 35 the General Office of the State Council on April 5,1999)

    The Proposals on Further Improving the Bank Guarantee Account System for Processing Trade, submitted by the
State Economic and Trade Commission, the Ministry of Foreign Trade and Economic Cooperation, the General Administration of Customs,
the Ministry of Finance, the State Administration of Taxation, the People’s Bank of China, and the State Administration of Foreign
Exchange, has been approved by the State Council and now are hereby transferred to you for implementation and fulfillment.

Appendix: Proposals on Further Improving the Bank Guarantee Account
System for Processing Trade (March 26, 1999)

    The bank guarantee account system for processing trade, which has been
implemented since 1995, has played active role in regulating the management
of processing trade and promoting healthy development of processing trade.
Processing trade has now become an important part of our foreign trade,
playing an import role in exploiting our labor resource advantage, enlarging
export, increasing employment, attracting foreign capital, and promoting the
development of local economy. In order to perfect the management of
processing trade, maintain the normal processing trade order, prevent and
attack smuggling, tax evasion and foreign exchange evasion in the veil of
processing trade and other illegal acts, proposals on further improving the
bank guarantee account system for processing trade are hereby put forward as
follows:

    1.Put management into practice according to the classification of commodities in the processing trade.

    In accordance with the requirements of the industry policy of the State, optimize commodity structure of processing
trade step by step; direct processing trade to the orientation of high technology and high extra value.

    Based on the commodities, classify processing trade into three types: the banned, the limited, and the permitted.

    (1) the banned type refers to commodities of which the import is prohibited by the Foreign Trade Law of the
People’s Republic of China and on which the Customs cannot conduct bond supervision.

    (2) the limited type refers to commodities whose imported materials or parts of which the prices at abroad
and at home are different greatly and difficult for the Customs to supervise.

    As for the processing trade of limited commodities, “actual transferring”
of the bank guarantee account system should be applied. That is, except type
“A” enterprises defined by this text, when other enterprises engaged in
processing trade import restricted parts and materials, the customs should
collect surety as tariffs and import value-added tax, and return the surety
with interest to enterprises after they fulfil the processing within the time
limit and transact the procedure of cancel after verification.

    (3) the permitted type refers to the other commodities not included in the banned and limited types. Except
type “C” enterprises defined by this text, the current system of “null transferring” should be applied to the permitted type.

    The commodities catalogue of managerial classification of processing trade should be determined and adjusted
at due time by the State Economic and Trade Commission together with the Ministry of Foreign Economy and Trade Cooperation and the
General Administration of Customs, and promulgated by the Ministry of Foreign Economy and Trade Cooperation.

    2.Apply classified management to enterprises engaged in processing trade.

    Enterprises engaged in processing trade are classified into four types: type A, type B, type C, and type D.
The lists of enterprises of type A, C, and D are determined by the General Administration of Customs together with the Ministry of
Foreign Economy and Trade Cooperation, and promulgated by the Ministry of Foreign Economy and Trade Cooperation. Dynamic management
should be applied to management of the lists of enterprises classification, and the lists should be adjusted at due time. The enterprises
of type B will not be listed out.

    (1) type “A” enterprises refer to bonded factories which are authorized by the General Administration of Customs
and supervised by the Customs-sent personnel who station at the factories and which engage in processing trade according to law and
have no record of rule-breaking acts of smuggling, or to enterprises which engage in processing trade of special industries such
as of airplanes, ships, etc. The imported materials and parts used for processing trade by type A enterprises are supervised by the
Customs, and the bank guarantee account system is not applied to them.

    The bank guarantee account system is not exercised in the processing trade conducted by enterprises in bonded
areas, the Measures for Customs Supervision in Bonded Areas are implemented.

    (2) type B enterprises refer to enterprises which are engaged in processing trade according to law and have
no record of rule-breaking acts of smuggling, the existing system of “null transferring” should continue to be applied to type B
enterprises.

    (3) type C enterprises refer to enterprises which are confirmed to have committed some rule-breaking acts
by the Customs in accordance with the relevant provisions of the Ministry of Foreign Economy and Trade Cooperation and the General
Administration of Customs. As for type C enterprises, the actually transferring of bank guarantee account is applied. The customs
should collect guarantee on the imported materials and parts for processing trade equals to the amount of import tax and import value-added
tax that should be imposed.

    (4) type D enterprises refer to enterprises which are confirmed to have committed the acts of smuggling or
not less than three times of rule-breaking acts by the Customs. As to type D enterprises, in addition to the handling by the Customs
according to law, the competent department of foreign economy and trade should suspend their operations rights of processing trade.
As to enterprises with foreign investment, the competent department of foreign economy and trade should notify the Customs to suspend
their import and export business for one year.

    As for the enterprises engaged in commissioned processing business, the classification principles and management
measures thereof are implemented by reference to the provisions in this Part.

    3.The management of “actual transferring” of bank guarantee account

    Enterprises engage in processing trade of which the imported materials and parts belong to the type of limited
commodities and type C enterprises should, when handling bank guarantee account according to provisions,  deposit the guarantee
into the designated account opened by the Customs in the Bank of China. After the enterprise has proceeded and exported its products
and undertaken the procedure of cancellation after verification within the stipulated time limit, the Bank of China should, on the
basis of the notice of account cancellation issued by the Customs, undergo the procedure of refund of guarantee, and calculate and
pay interest according to the interest rate of current deposit. Where an enterprise does not export the products or sell the products
in domestic market upon approval, the Customs should timely notify the Bank of China to transfer the guarantee and its interest into
tax and interest of deferred tax.

    4.Strengthen the management of processing trade at different localities.

    As for processing at different Customs territories, the operation unit of processing trade should closely
contact the competent department of foreign economy and trade as well as the competent Customs at the place where the processing
and producing enterprise is located, and should be strict in checking the factory and in the management of contract registration
and record.

    As for the processing trade in the form of commissioned processing, the operation unit must sign a commission
contract of processing with the processing and producing enterprise. The operation unit should not sell the imported materials and
parts with bond to the processing and producing enterprise, otherwise, it should be punished according to the relevant provisions
of the Customs Law of the People’s Republic of China.

    When the operation unit commissions a type C enterprise to process, the Customs must collect corresponding
amount of guarantee from the operation unit and then undertake the record of contract. The operation unit should not commission type
D enterprises to process.

    5.Restrain the management on changing factory to further process.

    (1) when the processing trade enterprises transact the business of further processing and then exporting with
the bonded commodities which have been carried froward, the enterprises should abide by the provisions on classified management of
commodities, apply for the verification from the competent department of foreign economy and trade. After obtaining the verification,
the enterprises may go to the Customs with the verifying document and undergo the procedure of carrying forward, the Customs then
apply strict supervision with bond according to the approval document of the competent department of the foreign economy and trade.

    (2) as for limited commodities and those which type C enterprises need to further process in another factory,
the Customs should supervise them according to the approaches applied in transportation between different territories or computer-net
management. If transportation between different territories or computer-net management cannot be realized, the Customs will collect
guarantee equaling to tax for forwarding and further processing of bonded commodities.

    (3) As for the business of forwarding and further processing, the involved enterprises may settle accounts
in a similar way as that of export and import trade, and undergo the procedure of paying exchange when importing and receiving exchange
when exporting as well as cancellation after verification.

    6.Further perfect protection mechanism of pursuing tax payment.

    If the enterprises engaged in processing trade establish bank guarantee account for the first time, they must
provide basic account number and certification of the bank where they opened their accounts. Conversely, they must preserve basic
account number. When the enterprises are pursued tax payment from caused by rule-breaking acts, the Customs will draw up the notification
of detention and send it to the bank where they opened their basic accounts. The banks concerned must co-operate with the Customs
to detain tax in accordance with the Law of the People’s Republic China on Tax Collection.

    7.Strictly control the act of domestic sale of the processing trade.

    The finished products of processing trade should be re-exported, and should not enter domestic market. If
for some particular reasons the products need to be sold at home market or used to produce domestically sold commodities, the matter
must be reported to the competent department of foreign economy and trade next higher the original approving organ of contract. On
the basis of the approval document of the competent department of foreign economy and trade, the Customs should collect tax and tax
interest of the imported materials and parts according to the provisions of the State, the term for calculating interest begins from
the declaration date on which the materials and parts are imported and ends at the date of paying tax in arrears. If the imported
materials and parts are the commodities under the administration of import quota license or registration, the operation unit should
submit authentication or import authorization for domestic sale or producing domestically sold commodities. If the unit cannot submit
such an authentication within the term of cancellation of verification, apart from the due tax and tax interest, the customs will
impose a fine, which is more than 30% of the value of the parts and materials imported and less than 100% of them. The enterprises,
which are engaged in domestic sale of the bonded parts and materials imported or the processed products with no authentication, should
be handled according to the Customs Law of the People’s Republic of China.

    8.Formulate the standards for wasting, strengthen cancellation after verification by the Customs.

    The General Administration of Customs and the State Economic and Trade Commission should, together with the
relevant industry bureaus of the State, formulate and promulgate in batches the uniform national wasting quota standards for imported
commodities of processing trade, which are to be used as the basis for examination, approval and supervision as well as cancellation
after verification of the number of the imported parts and materials. The competent department of foreign economy and trade must
examine and approve of the contracts of processing trade (including the business of carrying forward the products and further processing)
according to the standards, the Customs must cancel after strict verification according to the standards.

    9.Reinforce the co-ordination between departments and execute comprehensive management.

    Processing trade is easily influenced by policies; it involves many links. The relevant competent departments
should co-operate closely, and realize the interconnection of computer system among department in the examination and approval, recording
and cancellation after verification in relation to processing trade. An inter-ministry meeting for processing trade should be set
up by the State Economic and Trade Commission, together the Ministry of Foreign Trade and Economic Cooperation, the General Administration
of Customs, the Ministry of Finance, the State Administration of Taxation, the People’s Bank of China, the State Administration of
Foreign Exchange and the Bank of China, which will regularly exchange information and study policies, so as to do a good job in the
administration of processing trade.

    The contracts for processing trade, which have been approved by the competent department of foreign economy
and trade and been recorded by the Customs before the issuance of this Circular, should be implemented according to original provisions
of the bank guarantee account system.

    The relevant competent departments should formulate specific administration measures respectively according
to the above-mentioned proposals, and put them into force as of June 1, 1999.





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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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