Laws of the People's Republic of China

No. 93

The Provisions for Administering the Processes for the Nullification of Production Licenses for Industrial Articles have been deliberated and adopted at the executive meeting of the State Administration of Quality Supervision, Inspection and Quarantine on November 27, 2006. They are hereby promulgated, and shall go into effect as of March 1, 2007. Director General Li Changjiang

December 31, 2006

Provisions for Administering the Processes for the Nullification of Production Licenses for Industrial Articles Chapter I General Rules

Article 1

For the purpose of regulating the processes for the nullification of production licenses for industrial articles, protecting the legitimate rights and interests of citizens, legal persons and other organizations, and maintaining the social and economic order, these Provisions are formulated according to the Administrative License Law, the Administrative Penalty Law, the Product Quality Law, the Regulations for Administering Production Licenses for Industrial Articles as well as other relevant laws and administrative regulations.

Article 2

These Provisions shall apply to the implementation of the processes for the nullification of production licenses for industrial articles.

The term "industrial articles" as mentioned in these Provisions refers to the articles (including food and related articles) specified in the Regulations for Administering Production Licenses for Industrial Articles.

The term "processes for the nullification of a production license" as mentioned in these Provisions refers to the procedure in which the eligibility of production license acquired by the licensee is lawfully withdrawn, cancelled or revoked, or is lawfully terminated by virtue of any other statutory circumstance, and the nullification processes are gone through according to law.

Article 3

The implementation of the processes for the nullification of production licenses shall follow the principles that the facts are clear and the evidence is conclusive, as well as the principles of publicity, impartiality and justness.

Article 4

The supervisory department of quality and technology at each level shall withdraw, revoke and terminate production licenses and handle the processes for the nullification of production licenses according to these Provisions. In case otherwise provisions are made in any other law or administrative regulation, such provisions shall prevail.

Chapter II Withdrawal and Revocation of Production Licenses

Article 5

A decision on withdrawal of the production license shall be made under any of the following circumstances:

(1)

The law, regulation or rules on the basis of which the production license is granted are revised or repealed, and thus the item under the production license is terminated according to law;

(2)

The actual circumstance on which the production license is based has been materially changed, and thus the production license is terminated;

(3)

The articles licensed for production are listed into the catalogue of articles to be phased out by the state or whose production is forbidden by the state; or

(4)

Other stations under which the production license shall be withdrawn according to law.

Article 6

A decision on revoking the production license shall be made, in case a licensee is under any of the following circumstances:

(1)

The licensee obtains the production license by means of fraud, offering bribery or in other foul means;

(2)

The licensee has obtained the production license but is unable to consecutively maintain the necessary conditions, and fails to make corrections within the time limit; or

(3)

Other circumstances under which the production license shall be revoked according to law.

In case a licensing authority or any licensing functionary is under any of the following circumstances, sanctions shall be imposed upon it/him according to the Regulations for Administering Production Licenses for Industrial Articles, and a decision on revoking the production license may be made:

(1)

making a decision on granting the production license by abusing its/his power or by neglecting its/his duties;

(2)

making a decision on granting the production license by exceeding the statutory power;

(3)

making a decision on granting the production license with violation of the statutory processes;

(4)

granting a production license to an applicant who is unqualified or who fails to satisfied the statutory requirements; or

(5)

other circumstances under which the production license may be revoked according to law.

In case the revocation of a production license according to the preceding two paragraphs might bring on major damages to public interests, the production license may not be revoked.

Article 7

The withdrawal or revocation of a production license shall be decided on by the supervisory department of quality and technology that grants the production license in accordance with law.

The supervisory department of quality and technology at a higher level may revoke the production licenses granted by the departments at lower levels.

Article 8

In case the supervisory department of quality and technology at any level finds any circumstance under which a production license shall be withdrawn or revoked in its supervision or administration, it shall conduct an investigation and gather evidences according to the related provisions, propose its opinions on the withdrawal or revocation, and report to the supervisory department of quality and technology that grants the production license pursuant to the prescribed requirements level by level.

Article 9

The supervisory department of quality and technology shall, before making a decision on withdrawing or revoking a production license, inform the licensee of the facts, grounds and opinions on withdrawing or revoking the production license, and hear the licensee's statements and arguments.

The supervisory department of quality and technology shall verify the statements and arguments put forward by the licensee and adopt them in case they are tenable.

Chapter III Termination of Production Licenses

Article 10

A decision on revocation of the production license shall be made, in case a licensee is under any of the following circumstances:

(1)

The licensee fails to indicate the mark or serial number of the production license on the articles, packages or instructions according to legal provisions, and fails to make corrections within a time limit after being ordered to do so, and the circumstance is serious;

(2)

The licensee leases, lends or transfers its license certificate, mark or serial number of the production license, and the circumstance is serious;

(3)

The articles are found to be unqualified from the supervision and spot check conducted by the administrative department at the national or provincial level, and are found to be still unqualified from re-check even after rectification; or

(4)

Other circumstances under which the production license shall be terminated according to law.

Article 11

An administrative penalty decision on terminating a production license shall be made by the supervisory department of quality and technology at the place where the licensee is located in accordance with its jurisdictional power and subject to the processes for handling cases, who shall also be responsible for the enforcement of the decision. Before making the administrative penalty decision on terminating the production license, the supervisory department of quality and technology at the place where the licensee is located shall, according to the provisions , report to the supervisory department of quality and technology that grants the production license for approval level by level.

Article 12

In case a supervisory department of quality and technology at any level finds any circumstance under which the licensee's production license shall be terminated in its supervision or administration, it shall notify the supervisory department of quality and technology at the place where the licensee is located to implement Article 11 of these Provisions.

Article 13

Before making an administrative penalty decision on terminating a production license, the supervisory department of quality and technology shall, according to the provisions on the processes for handling cases, propose its opinions on terminating the production license, hear the licensee's statements and arguments, and inform the licensee of the right to file an application for hearing.

In case the licensee requires a hearing within the provisioned time limit, the hearing shall be held according to the related rules on hearing.

Article 14

After the licensee's statements and arguments are heard or after the hearing ends, in case the supervisory department of quality and technology holds that the licensee's illegal facts are clear and the evidence is conclusive, it shall, according to the prescribed requirements, report the written suggestion on terminating the production license and other related information to the supervisory department of quality and technology that granted the production license level by level.

The supervisory department of quality and technology that grants the production license shall make a reply according to the related provisions in a timely manner.

The supervisory department of quality and technology at the place where the licensee is located shall, in accordance with the reply of the production license-granting department concerning consent with the termination, make an administrative penalty decision to the licensee on terminating the production license and shall be responsible for the enforcement of the decision.

Chapter IV Handling of the Nullification Processes

Article 15

Where any of the following circumstances arises, the processes for the nullification of the production license shall be gone through according to law:

(1)

The production license is withdrawn, revoked or terminated according to law;

(2)

The valid term of the production license has expired but is not extended;

(3)

The licensee has been terminated according to law;

(4)

The item in the production license is unable to be carried out because of force majeure; or

(5)

Other circumstances as provisioned in any law or regulation under which the production license shall be nullified.

Article 16

In case e a production license is withdrawn, revoked or terminated according to law, the supervisory department of quality and technology that grants the production license shall handle the nullification processes according to law.

Article 17

In case a production license shall be nullified owing to any other circumstance, the supervisory department of quality and technology at each level may put forward suggestions based on the facts, and report to the supervisory department of quality and technology that grants the production license; the department that grants the production license shall handle the nullification processes according to the related provisions in a timely manner.

Article 18

The supervisory department of quality and technology that grants production licenses shall be responsible for announcing the name list of the licensees whose production licenses have been nullified, or other related matters.

Chapter V Supplementary Rules

Article 19

In case a supervisory department of quality and technology or any staff thereof is violates any law, regulation or rule in the withdrawal, revocation, termination or nullification of production licenses, it/he shall be punished according to the related provisions on law enforcement administrative supervision and those on the investigation of liabilities for faults in law enforcement administration.

Article 20

The legal affairs office and the administrative supervision office of the supervisory department of quality and technology shall intensify their supervision over the withdrawal, revocation, termination and nullification work of the production license handling institution and the law enforcement institution.

Article 21

In case, after a production license is nullified, the licensee continues its production, the supervisory department of quality and technology shall punish it according to the related provisions on the investigation and punishment of the activity of conducting production without a permit.

Article 22

The State Administration of Quality Supervision, Inspection and Quarantine shall be responsible for the interpretation of these Provisions.

Article 23

These Provisions shall go into effect as of March 1, 2007.