GACC Announcement No.40, 2015 (on Crude Oil Futures Bonded Delivery )

To help the marketing of crude oil futures in China with definite Customs requirements on bonded delivery of crude oil futures, relevant matters are hereby announced:

1. Bonded delivery of crude oil futures shall be conducted in qualified special Customs-controlled zones or bonded supervision premises. Shanghai International Energy Exchange shall register with the GACC the deliverable oils and dedicated delivery warehouses regarding the bonded delivery.

2. The dedicated delivery warehouses shall be furnished with conforming computer management systems that are networked with the Customs system.

Shanghai International Energy Exchange shall be networked with the Customs in charge of any of the dedicated delivery warehouses and shall, through standard warehouse warrant system, real-time provide electronic versions of bonded delivery final statement (see Annex 1, 2), bonded standard warehouse warrant list (see Annex 3), etc.

3. In the dedicated delivery warehouses, different varieties of oils under bonded delivery shall not be mixed with each other in storage, while one storage tank can be used to store one variety of oils belonging to different owners under bonded delivery.

4. Upon completion of the bonded delivery, where the crude oil will be imported or exported, the legal holder of the dedicated delivery warehouse and bonded standard warehouse warrant shall make customs declaration on the strength of bonded delivery final statement and bonded standard warehouse warrant list.

5. The Customs shall set duty-paid value for the futures-bonded crude oil as per the following rules:

(1) In the case of delivery at maturity with bonded standard warehouse warrant, the duty-paid value shall be calculated by virtue of Shanghai International Energy Exchange's bonded delivery settlement price plus delivery premium or discount.

(2) In the case of delivery at EFP (exchange for physicals) with bonded standard warehouse warrant, the duty-paid value shall be calculated by virtue of Shanghai International Energy Exchange's latest-month futures settlement price on the trading date immediately before the EFP application date, plus delivery premium or discount.

(3) In the case of delivery at EFP with non-standard warehouse warrant or in the case of transfer with bonded standard warehouse warrant but without the bonded delivery, the duty-paid value shall be calculated as per existing regulations on domestic sale of bonded goods.

(4) As regards more or less imported at bonded delivery, the duty-paid value shall be calculated by virtue of Shanghai International Energy Exchange's latest-month futures settlement price on the trading date immediately before the oil discharged-from-warehouse date, plus delivery premium or discount.

6. The bonded standard warehouse warrant may be pledged as security which shall be based on tax guarantee as per Customs requirements. The warrant holder shall, when registering the pledge with the Customs, submit the following documents:

(1) Bonded standard warehouse warrant pledge registration form (see Annex 4);
(2) Business incorporation certificate and its copy;
(3) Cash deposit or bank guarantee: the amount guaranteed shall not be less than tax payable on the pledged goods, and the guarantee period shall not be less than the pledge period.
(4) Other documents required by the Customs.

7. Where the warrant holder requests dissolution of the pledge, the holder shall submit to the Customs relevant pledge deregistration form (see Annex 5), the copy of pledge dissolution agreement, and other document required for the dissolution. Upon the pledge dissolution, more than one warrant under one pledge contract shall not be dissolved by batch.

8. The bonded standard warehouse warrant may be transferred and be used as futures trading deposit.

9. Where domestic crude oil used for futures-bonded delivery is stored in dedicated export warehouse, the Customs will transmit relevant export clearance information (electronic version) to State Administration of Taxation.

10. No time limit will be set for the storage of crude oil under futures-bonded delivery in the dedicated delivery warehouse.

11. The dedicated delivery warehouse shall declare its actual loss in truth; as regards natural loss in storage of the crude oil under bonded delivery, the Customs will put into tryout the identification criterion of not more than 0.12%/year (or 1.2‰/year).

This Announcement shall enter into force upon its issuance.

Annex 1. Final Statement of Bonded Delivery (for Customs Declaration-1) (omitted)
Annex 2. Final Statement of Bonded Delivery (for Customs Declaration-2) (omitted)
Annex 3. Bonded Standard Warehouse Warrant List (omitted)
Annex 4. Bonded Standard Warehouse Warrant Pledge Registration Form (omitted)
Annex 5. Bonded Standard Warehouse Warrant Pledge Deregistration Form (omitted)


General Administration of Customs of China (GACC)
August 20, 2015