GACC Announcement No.19, 2018 on Company-Based Processing-Trade Regulatory Mode

[2018-03-06 14:32:07]

The General Administration of Customs has decided to promote the “company-based processing-trade regulatory mode” (hereinafter referred to as the “new regulatory mode”). This is to announce relevant matters:

Ⅰ Customs Districts Applicable and Business Scope

1. Customs Districts applicable: Tianjin, Hohhot, Manzhouli, Shenyang, Changchun, Harbin, Shanghai, Nanjing, Hangzhou, Ningbo, Hefei, Xiamen, Nanchang, Qingdao, Zhengzhou, Wuhan, Guangzhou, Shenzhen, Gongbei, Huangpu, Zhanjiang, Nanning, Chongqing, Chengdu, Xi’an, Urumqi;

Nationally-uniform e-information system will be applied in all the Customs Districts aforesaid.

2. The Customs may select processing-trade companies to apply the new regulatory mode and the companies shall be the manufacturing firms with processing-trade business in their own names and shall meet one of the following conditions:

(1) Having ordinary credit rating or higher;
(2) Having ordinary credit rating, and transparent and clear in internal processing-trade goods and data flows, integral in logical chain, traceable in consumed materials, compliant with Customs regulations;

3. The scope of business includes: account setup or alteration, import and export, outward processing, deep-processing carry-over, domestic sales, remaining parts carry-over, reporting and cancel, self-owned after-sales maintenance, etc.

Ⅱ Main Contents

1. The qualified companies shall undertake processing-trade business in the following ways:

(1) Account Setup: choose to set up the processing-trade account with material numbers or item numbers; set the largest import volume to the production capacity specified by “Business Operation & Capacity Certificate”, i.e. imported materials/parts corresponding to value.
(2) Cancel Cycle: in line with production cycle, select reasonable cycles of cancel and confirm the steps to declare unit consumption.
(3) Outward Processing: not to send Dispatch/Reception List anymore, and save relevant documents and records.
(4) Domestic Sales: prior to the 15th day each month, pay the duties/tax of the previous month on bonded goods for domestic sales, without cross-year payment.
(5) Deep Processing Carry-Over: prior to each month-end, declare the deep processing carry-over of the previous month, without sending Dispatch/Reception List, and save relevant documents and records.
(6) Remaining Parts Carry-Over: manage the real inventory in the form of remaining parts carry-over.

2. Within a cancel cycle, the qualified companies shall apply for cancel formalities by self-declaration and, if the cancel cycle is beyond one year, shall make annual declaration.

(1) Self-Declaration: actively declare the consumption of bonded imported materials or parts by submitting unit consumption list, work orders, etc.
(2) Annual Declaration: with cancel cycle beyond one year, annually declare the manual data such as consumption of bonded imported materials or parts.

3. By the end of the cancel cycle, the qualified companies shall actively make supplemental declarations of any unexpected issues with relevant controlling or correcting measures; the Customs shall make centralized management of the declarations.

4. The qualified companies shall, as per material numbers and item numbers in the manual, declare import or export in the form of processing with imported materials or with the materials supplied by foreign clients.

5. The qualified companies shall submit or preserve relevant electronic data and paper documents.

6. Regarding companies under one of the following circumstances, the Customs will remove the companies from the new regulatory mode:

(1) Fall into discredited firm;
(2) Deficient in internal information system, incomplete in the logic chains of processing-trade goods/data flow, irregular in the management of consumed materials;
(3) Failed to standardize customs formalities and timely provide or save relevant data and documents;
(4) Initiative to request the removal from the new regulatory mode;
(5) Other cases applicable to the removal;

Within 30 days upon the removal, the companies involved shall apply to the Customs for processing-trade account cancelling formalities.

Ⅲ Other Matters

(1) Upon the implementation of this Announcement, regarding the outstanding processing-trade account, the companies’ goods or materials pending export may be carried over into their new-set account.
(2) Other issues undefined herein may be subject to general regulations on processing trade.

This Announcement shall enter into force as from 5 March 2018, along with the repeal of GACC Announcement No. 29 of 2017.

General Administration of Customs of China (GACC)
February 26, 2018

Source: ETCN