Guide to Application, Transaction and Administration for Duty Reduction or Exemp

ⅶ. Customs may conduct audits on account books, account vouchers, declaration forms and other relevant data as well as goods of the enterprises and units directly related to import and export activities within the period of Customs supervision and control over goods granted with duty reduction or exemption and three years afterwards.

ⅷ. The party concerned shall clear the Customs in advance when the goods under Customs supervision and control (including the goods granted with duty reduction or exemption under Customs supervision and control) will be dealt with in accordance with the judgement, decision of the people's court or the decision of the relevant administrative departments.

ⅸ. Project units (enterprises) shall report the conditions of the goods granted with duty reduction or exemption to the competent Customs once a year after the release of such goods within the period of Customs supervision and control.

ⅹ. Customs supervision and control will be terminated automatically when the time limit of Customs supervision and control over equipment granted with duty reception or exemption is reached on condition that there is no performance violating the Customs regulations. Project units (enterprises) shall apply to Customs for termination with the hold of the relevant papers and documents if the control termination certificate is needed.

Periods of Customs supervision and control over goods under duty reduction or exemption are as follows:
1. Vessels, aircrafts: 8 years
2. Motor vehicles: 6 years
3. Other goods: 5 years
III. Relevant Provisions about Punishments of the Customs Law of the People's Republic of China
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Article 82
Breach of this Law and relevant laws and administrative regulations, evasion of Customs control, defraud payable impost, elusion of national inward and outward prohibition or restriction in any of the situations listed below shall be deemed as smuggling:

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ⅱ. to sell within the territory, without Customs permission and without having paid the payable duties and taxes or producing relevant licensing document, bonded goods, goods under specific duty reduction or exemption and other goods, articles or inward foreign means of transport under Customs control.

If any of the acts listed in the preceding paragraph does not constitute the crime of smuggling, the Customs may, while confiscating the smuggled goods, articles and illegal proceeds obtained therefrom, concurrently impose a fine on the person or persons concerned. When any of the acts listed in the first paragraph of this Article that constitutes a crime, the person or persons concerned shall be investigated for criminal liability according to law.
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Article 86
A fine may be imposed for any of the following acts which violate this Law and the illegal proceeds obtained therefrom shall be confiscated if there any:
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ⅹ. to open, and dismantle, collect, deliver, forward, transpose, refit, mortgage, impawn, keep transfer, replace label, shift to other use or conduct other treatment on goods under Customs supervision and control without Customs permission.