GACC Announcement No.53, 2015 (on Processing-Trade Work Order Verification & Cancel)

In order to standardize processing-trade work order verification and cancel, relevant matters are hereby announced:

1.Work order verification and cancel means that a processing-trade firm submits to the Customs its declaration forms, declaration list data and ERP system-based work order data while the Customs generates original electronic account of parts/materials consumption and makes verification and cancelation according to input, output, consumption, transfer, and storage of corresponding parts/materials, semi-finished products and finished products.

2.A processing-trade firm shall meet the following requirements for work order verification and cancel:

(1) Credit standing shall not be lower than general creditable enterprise;
(2) Use of ERP system for information management of purchase, production, stock and sale; traceability of consumed imported bonded materials through work orders; use of work order for recording actual consumption of materials
(3) Having computer management system in line with Customs requirements to connect to Customs supporting system/platform through data exchange platform and deliver required electronic data
(4) Having separate management over bonded and non-bonded materials
(5) Having work order with manufacturing date, products, materials, quantity, status and other relevant information

3.The processing-trade firms shall timely deliver work order data in their ERP systems in line with Customs requirements.

4.The processing-trade firms shall finish data report within 30 days upon the end of verification period set by the Customs. Where necessary, the data report may be postponed by 60 days at most. The verification period shall not exceed one year.

5.The Customs will make comparison between actual material inventory on the verification deadline and legal material inventory set in Customs supporting systems and then make disposals as follow:

(1)Where actual inventory is more than legal inventory upon justified reason, the Customs will confirm corresponding balance in light of actual inventory.
(2)Where actual inventory is less than legal inventory upon justified reason, the Customs will confirm corresponding balance in light of actual inventory; regarding the shortage, the Customs shall require the firms to pay supplemental tax; leftover materials shall be classified and taxed as per real inspection status.

6.Where a processing-trade firm is disorderly in internal management or lawbreaking in some conduct, the Customs may terminate its work order verification and cancel.

This Announcement shall enter into force upon its issuance.



General Administration of Customs of China (GACC)
November 5, 2015