Laws of the People's Republic of China

   Article 1 The present Regulations are to strengthen supervision of international-shipping-agency services and meet the Country's foreign economic relations development needs and international-shipping-industry requirements.

   Article 2 The present regulations are applicable to agency services vessels for international navigation.

   Article 3 The Ministry of Communications of the People's Republic of China (hereinafter referred to as the Ministry of Communications) is the State organization for supervising shipping-agency services.

   Article 4 Only shipping agencies established with the approval of the Ministry of Communications are permitted to handle shipping-agency services. The shipping agencies must be legal persons of State enterprises of the People's Republic of China. The number of shipping agencies permitted in each harbor shall be determined by the Ministry of Communications in the light of actual needs arising from the harbor's business.

   Article 5 A shipping agency shall meet the following requirements before it can be established:

(1) It operates on its own and is able to bear civil responsibility independently;

(2) Its legal representative has professional knowledge and capable of handling experience in international-maritime-shipping-agency services;

(3) It has essential full-time personnel in business, Customs declaration, finance, foreign languages and other disciplines;

(4) It is familiar with China's laws, regulations and requirements concerning vessels for international navigation and is able to urge and help vessels using its agency service to observe and implement them conscientiously;

(5) It has articles of association, permanent organization, work place and necessary transport and telecommunication facilities;

(6) It has funds for its business operations.

   Article 6 An application for permission to establish a shipping agency shall be submitted in written form to the organization in charge of communications in the locality where the agency is to be situated.

The application shall include the following items:

(1) The agency's name (including its English translation), detailed address (in both Chinese and English), telephone, cable and telex numbers, and post-code;

(2) Its projected business items;

(3) A certificate of its registered capital and the capital it actually has or guarantee fund;

(4) The name, age, profession, detailed experience and address of its legal representative;

(5) The agency's articles of association, organizational structure and disposition of professional personnel.

   Article 7 The application for permission to establish a shipping agency- after being checked by the departments in charge of communications in the locality where the agency is to be situated and the province (municipality, autonomous region) concerned-shall be submitted to the Ministry of Communications for examination and approval. The Ministry of Communications will decide to approve or disapprove the application after examining it in the light of the actual need and the requirements of the present Regulations.

If the application is approved, the applicant shall take alone the Ministry of Communications' document of approval and register with the Administration for Industry and Commerce in the locality where the agency is situated and obtain its license before it can start operations. After starting operations, it shall submit, within 15 days, photocopies of its license to the Ministry of Communications and the departments in charge of communications in the locality where the agency is situated and in the province concerned for the record.

   Article 8 The Ministry of Communications may determine the scope of business of the shipping agency in the light of its scale, capital, capability, conditions and relevant regulations.

Within the scope of business approved by the Ministry of Communications, the shipping agency may handle part or all of the following agency operations at the request of a shipping company;

(1) Making contacts and arranging for the entry into or exit from a harbor, locking and loading or unloading of ships;

(2) Making customs declarations for ships, cargoes and containers;

(3) Handling consignment, transshipment and combined-through- transportation of cargoes and containers;

(4) Signing bills of lading, transport contracts and agreement for rapid ship dispatch or holdup of ships;

(5) Handling international-passenger shipping;

(6) Organizing freight and ordering shipping space for cargo owners;

(7) Arranging for rescue and salvage at sea and undertaking maritime and admiralty affairs;

(8) Acting as an agent in paying and collecting money and settling accounts;

(9) Handling other items of shipping agency and service.

   Article 9 When a shipping agency, which has started operations, wants to expand or change its business scope, it shall go through the formalities of examination and approval provided for in Articles 6, 7 and 8.

   Article 10 A shipping agency shall carry out its operations on the following principles;

(1) Observing the country's principles, policies, laws and administrative codes and regulations, safeguarding national rights and interests and guarding State secrets;

(2) Fulfilling its responsibilities in line with the entrustment, safeguarding the mandator's legitimate rights and interests, and performing the committed obligations;

(3) Directing the shipping company, vessels and crew members it represents to observe relevant Chinese laws and regulations and assisting the authorities in charge in handling matters such as violation of laws and regulations by the shipping company, vessels and crew members;

(4) Refraining from cheating in any form and illegal competition by use of improper methods or at the cost of national interests.

   Article 11 A shipping company enjoys complete independence in selecting its shipping agency and no institution or individual shall interfere in any way. No parties concerned must include provisions to restrict the shipping company's freedom of choosing its shipping agency in the relevant contract.

   Article 12 A shipping agency must abide by the standard rates or fees or charges set by the Ministry of Communication for all to follow and must not pay sales commission openly or in disguised form.

   Article 13 Shipping agencies designated by the Ministry of Communications shall provide agency service for the following vessels;

(1) Foreign military vessels;

(2) Ships for training and scientific investigation;

(3) Passenger ships (including tour ships) and private yachts;

(4) Engineering ships and their support vessels;

(5) Other types of vessels for which shipping agencies shall be designated.

   Article 14 All shipping agencies shall report to the Ministry of Communications their business operations in the first six months of a year and the entire year by the end of July and the end of the following February respectively. They shall send copies of the report to the organizations in charge of communications in the localities where they are situated and to the same organizations in the relevant provinces, municipalities directly under the central authorities and autonomous regions. The content of the reports shall include:

(1) Profits or losses in revenue and expenditure;

(2) A list of the shipping companies and vessels each agency represents, arranged in the order of their nationalities, and the total number of vessels represented (each time a ship is represented shall be counted as one vessel);

(3) Statistics of the flow of import and export commodities carried by the vessels represented and separate lists of the amounts of cargo transported by ships sent by the Chinese side and by ship sent by the other side;

(4) Other matters to be reported at the request of the Ministry of Communications.

   Article 15 The Ministry of Communications and local organizations in charge of communications authorized by it are entitled to check on the business operations of the shipping agencis. The agencies under investigation must truthfully report their state of affairs and provide relevant information.

   Article 16 When shipping agencies violate the present Regulations, the Ministry of Communications and local organizations in charge of communications authorized by it may, on the merit of the cases, mete out to them the following penalties:

(1) Warning;

(2) Circulating a notice of criticism;

(3) Fine;

(4) Ordering the offender to suspend operations and straighten itself out;

(5) Cancelling its approved qualifications for business operations.

   Article 17 Companies approved to handle shipping agency business before the present Regulations are promulgated shall, within three months after they come into force, go through the formalities of applying to the Ministry of Communications for approval retrospectively in line with the requirements of Article 5 and 6 of the present Regulations. Those shipping agencies which fail to go through the formalities within the time limits shall be disqualified.

   Article 18 The Ministry of Communications is responsible for interpreting the present Regulations.

   Article 19 The present Regulations shall come into force as of April 1, 1990.