Laws of the People's Republic of China

Circular of the State Administration of Taxation on Relevant Issues concerning the Record of Export Contract

Guo Shui Han [2006] No. 847

Bureaus of State Taxes in all provinces, autonomous regions, municipalities directly under the Central Government and cities specially designated in the State plan:

With the approval from the State Council, Circular on Readjusting the Export Rebate Rate for Some Commodities and Supplementing the Prohibitive Catalog for Processing Trade (Cai Shui [2006] No. 139) was released by the Ministry of Finance, the Ministry of Commerce, the National Development and Reform Commission, the State Administration of Taxation, the General Administration of Customs, prescribing that the export rebate rate for some export goods shall be adjusted as of September 15, 2006, and that after an export contract concluded with foreign parties before September 14, 2006 (including September 14, 2006) undergoes the formalities of record at the taxation authorities within the prescribed period, and if the goods under this export contract hereof are exported within the prescribed period, an export enterprise may continue to go through the formalities of export rebate in accordance with the pre-adjustment export rebate rates. And a circular is hereby given on relevant issues concerning the record of export contract as follows:

Article 1

An export contract to be recorded as mentioned in this Circular refers to a contract in written from concluded in accordance with the provisions in Article 11 of the Contract Law of the People's Republic of China, and these conditions as follows shall be met at the same time:

(1)

To be concluded before September 14, 2006 (including September 14, 2006);

(2)

To have clear indications of a contract conclusion date, export enterprise, foreign businessman, name of export commodities, unit price, quantity, amount, contract serial number, etc.;

(3)

To have the signatures or seals from both the export enterprise and the foreign businessman, and an contract in written from concluded in the form of data cable shall be printed by the export enterprise and signed or sealed by the person in charge of the enterprise hereof;

(4)

The content of the contract shall be authentic and effective.

Article 2

An export enterprise shall, before September 30, 2006, submit the original copy of the contract bearing the seal of the enterprise hereof in line with the provisions in Article 1 of this Circular and its duplicated copy (a clear indication to be given to be in line with the original copy and signed by the person in charge of the export enterprise hereof), and the Application Form for Record of Export Contracts (See Annex 1) to the local taxation authorities in charge of export rebate (hereinafter referred to as the taxation authorities) for record.

Article 3

The taxation authorities at all levels shall timely handle the application of an export enterprise for record of the relevant export contract, and carefully examine and verify it in accordance with the provisions in Article 1 and Article 2 of this Circular. After the examination and verification, the export contract which is in line with the provisions shall be allowed to undergo the formalities of record, and the original copy of the export contract hereof shall be returned to the export enterprise at the same time; and the export contract which fails to be in line with the provisions shall uniformly not be allowed to undergo the formalities of record, and be returned to the export enterprise.

Once an export contract undergoes the formalities of record, it shall bear no alteration.

Article 4

After an export enterprise enters out the goods under the aforesaid export contract, a separate indication shall be given when the formalities of export rebate are undergone.

Article 5

The taxation authorities shall, when examining and approving the export rebate for the goods under the aforesaid recorded export contract, emphatically examine and verify the main content and the content in relation to the actual export in the recorded export contract besides examining and verifying routinely the documents which shall be provided by an export enterprise in accordance with the current provisions. Where the goods are exported before December 14, 2006 (including December 14, 2006, and the date of export in the Declaration Bill for Export Goods (exclusively used for export rebate) indicated by the customs authorities shall apply), and the actually exported goods are in line with the export enterprise, foreign businessman, name of export commodity and other items in the recorded export contract, the taxation authorities shall handle the formalities of export rebate in accordance with the pre-adjustment export rebate rate; where any of the export enterprise, foreign businessman, name of export commodity etc. under the recorded export contract bears alterations, the export goods within the recorded amount of this contract shall undergo the formalities of export rebate in accordance with adjusted export rebate rate, and the excessively rebated funds shall be recovered by the taxation authorities.

The aforesaid recorded amount refers to the export amount of the export goods applying for being subject to the pre-adjustment export rebate rate.

Article 6

Where an export contract of an export enterprise undergoes the formalities of record at the taxation authorities, and the amount and quantity of the actually exported goods exceed the recorded amount and quantity in the recorded contract, the exceeded part shall undergo the formalities of export rebate in accordance with the readjusted export rebate rate.

Article 7

Except the business of processing imported materials for re-export, the export businesses applying for export rebate in other modes of trade shall be subject to the measures for record of export contract prescribed in this Circular.

Article 8

With regard to the export on consignment, the agreement on export on consignment concluded with a consignee enterprise of a consigner enterprise shall undergo the formalities of record at the taxation authorities besides its export contract. Where an export contract is concluded between a consignee and a foreign businessman, the consigner shall uniformly go through the formalities of contract record.

Article 9

Once an export enterprise is detected to seek illegal interests by altering, counterfeiting and signing inversely the date and other means, the taxation authorities shall not handle the formalities of export rebate for it, and the rebated or excessively rebated funds shall be recovered, and a fine shall be given in accordance with the provisions in relevant laws and regulations.

Article 10

The export of coal shall undergo the formalities of record of export contract in accordance with the provisions in Article 1 .4.3 of the document coded Cai Shui [2006] No. 139.

Article 11

The taxation authorities at all levels shall do well the work of sorting and statistics of the recorded export contracts. The Bureaus of State Taxes in all provinces (autonomous regions, municipalities directly under the Central Government and cities specially designated in the State plan) shall, before October 31, 2006, report to the State Administration of Taxation (Department of Import and Export Duties and Taxes) in written form the record of contracts of this time and the Statistical Form for Record of Export Contracts (Annex 2, excluding coal export).

Annexes

1.

Application Form for Record of Export Contracts (omitted)

2.

Statistical Form for Record of Export Contracts (omitted)

State Administration of Taxation

September 14, 2006