PROVISIONS OF THE GENERAL CUSTOMS ADMINISTRATION ON CONTROL OVER GOODS, MEANS OF CONVEYANCE, LUGGAGE AND POSTAL ARTICLES ENTERING OR LEAVING THE SPECIAL ECONOMIC ZONES

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PROVISIONS OF THE GENERAL CUSTOMS ADMINISTRATION ON CONTROL OVER GOODS, MEANS OF CONVEYANCE, LUGGAGE AND POSTAL ARTICLES ENTERING OR LEAVING THE SPECIAL ECONOMIC ZONES

Category	CUSTOMS	Organ of Promulgation	The State Council	Status of Effect	In Force
Date of Promulgation	1986-03-25	Effective Date	1986-04-01

Provisions of the General Customs Administration of the People's Republic of China on Control Over Goods, Means of Conveyance, Luggage and Postal Articles Entering or Leaving the Special Economic Zones

Chapter I  General Provisions
Chapter II  Control over Goods Entering or Leaving SEZ
Chapter III  Control over Means of Conveyance Entering or Leaving SEZ
Chapter IV  Control over Luggage and Postal Articles Entering and Leaving
Chapter V  Supplementary Provisions
Notes:

(Approved by the State Council on March 21, 1986, promulgated by the

General Customs Administration on March 25, 1986)
Chapter I  General Provisions

Article 1 These Provisions are formulated with a view to promoting the
development of Special Economic Zones, safeguarding national interests and
ensuring the smooth progress of socialist construction.

Article 2 These Provisions shall apply to the four Special Economic
Zones: Shenzhen, Zhuhai, Shantou and Xiamen (hereinafter referred to as "SEZ").

Article 3 Goods, means of conveyance, luggage and postal articles
entering or leaving SEZ shall go through the railway stations, road passes,
sea ports, aerodromes or post offices where there are Customs establishments
and shall be subject to declaration to the Customs and to its supervision and
control.

Article 4 All foreign trade enterprises or production enterprises within
SEZ engaged in import or export business shall complete the formalities of
registration at the Customs against the documents of approval issued by the
foreign economic and trade administrations at the provincial level or above,
or by SEZ people's governments.

If it is necessary, Customs officers may be sent to the aforesaid
production enterprises and stationed there for the performance of supervision
and control and the conduct of Customs procedures. All such enterprises shall
provide necessary offices and accommodations free of charge.

Regular written reports on the end-use, sales and inventory of the
imported goods shall be submitted to the Customs by the enterprises mentioned
in Paragraph 1 of this Article for inspection and verification.

Article 5 Smuggling and other illegal activities carried out by taking
advantage of the preferential treatments granted to SEZ by the State are
strictly prohibited. The Customs is empowered to inspect, in accordance with
the Interim Customs Law (Note 1.) any premises in SEZ which are suspected of
concealing smuggled goods.

Article 6 Goods, means of conveyance, passengers' luggage and personal
effects and mail destined to or originated from the non-SEZ areas of China,
on their way, from or to foreign countries or regions of Hong Kong and Macao
via SEZ, shall be handled in accordance with relevant State regulations on
the control of imports and exports.

Article 7 The Customs establishments in SEZ shall register the statistics
of the goods, means of conveyance, passengers' luggage and personal effects,
and mails entering and leaving SEZ according to the categories of import,
export or transport between SEZ and the non-SEZ areas.
Chapter II Control over Goods Entering or Leaving SEZ

Article 8 The consigner or the consignee or his agent shall fill in the
Customs declaration forms declaring the goods entering or leaving SEZ and
submit the relevant licenses and other documents to the Customs for
examination in accordance with pertinent regulations.

Article 9 The Customs duties and consolidated industrial and commercial
taxes (products tax and value added tax) on goods imported by the
administrative organs, institutions and enterprises in SEZ for use within SEZ,
upon approval of the competent authorities specified by State regulations,
shall be dealt with in the following ways:

(1) No duty and tax shall be levied on the machines, equipment, spare
parts, components, materials, fuel and transport vehicles imported for
construction and production in SEZ, nor on foodstuffs for the tourism and
catering trade and office equipment and means of transport imported in
reasonable quantities by enterprise, institutions and administrative organs
for their own use.

(2) Duties and taxes shall be levied at specified rates on goods, spare
parts, and components which are subject to import restrictions set by the
State, except those imported by enterprises for their own use in production
and business operations or by administrative organs and institutions for
their own use.

(3) The departments authorized by the State shall review and determine
annual import quotas for goods other than those listed in Items (1) and (2)
of this Article, and duties and taxes shall be computed and collected on the
goods imported within the set quotas at half of the specified rates, and
full-rate duties and taxes shall, according to relevant regulations, be
levied on the goods imported beyond the set quotas.

Article 10 Exemption from export duties shall be granted to export goods
produced by enterprises in SEZ.

Article 11 When the finished products manufactured in SEZ are transferred
to non-SEZ areas upon approval according to the relevant State regulations,
the consigner or his agent shall declare to the Customs by filling out a
declaration form for the transference of goods to other areas from SEZ and
submit it together with the approval document and other relevant papers to the
Customs in conformity with the regulations. The aforesaid products shall be
released by the Customs after checking.

Goods imported into SEZ are strictly prohibited from being transferred
to other areas for sale unless otherwise stipulated by the State.

Article 12 Finished products processed or assembled by enterprises in
SEZ with raw materials, spare parts, components (hereinafter referred to as
materials and parts) imported duty free shall be re-exported.

Where the finished products mentioned above are transshipped, upon
approval, to other areas, payment of duties and taxes shall be calculated
on the basis of the imported materials and parts employed in the products.
Where the products are sold within SEZ, exemption from or payment of duties
and taxes on the imported material and parts shall be handled according to
the stipulations in Article 9 of these Provisions. In a case where the
consigner or his agent fails to clarify the description, quantities and value
of imported materials and parts employed in the products, payment of duties
and taxes shall be calculated at such a rate as if the finished products as a
whole had been imported.

Article 13 The consignee or his agent shall declare to the Customs on
goods introduced into SEZ from other areas and the Customs shall release such
goods after checking.
Chapter III Control over Means of Conveyance Entering or Leaving SEZ