Foreign Trade Law of the People’s Republic of China


 Foreign Trade Law of the People’s Republic of China

(Adopted at the 7th Session of the Standing Committee of the 8th National People's Congress on May 12, 1994, and amended at the 8th Session of the Standing Committee of the 10th National People’s Congress on April 6th, 2004)

Table of Contents

Chapter I, General Provisions
Chapter II, Foreign Trade Administrators
Cheaper III, Import and Export of Commodities and Technology
Chapter IV, International Service Trade
Chapter V, Intellectual Property Protection Related to Foreign Trade
Chapter VI, Foreign Trade Order
Chapter VII, Foreign Trade Investigation
Chapter VIII, Foreign Trade Relief
Chapter IX, Promotion of Foreign Trade
Chapter X, Statutory Responsibility
Chapter XI, Supplementary Provisions

Chapter I. General Provisions

Article 1 The law is promulgated in order to enlarge the opening policy, develop foreign trade , maintain the foreign trade order and protect the lawful rights and interests of foreign trade administrators so as to promote a healthy development of socialist market economy.

Article 2 This law is applied to foreign trade and intellectual property protection related to foreign trade.
The foreign trade mentioned in this law includes the import and export of commodities, import and export of technologies and international service trade.

Article 3 The authority responsible for foreign trade under the State Council shall superintend the national foreign trade.

Article 4 The State shall apply a unified system of foreign trade, encourage the expansion of foreign trade and maintain an impartial and free order of foreign trade.

Article 5 The People’s Republic of China shall promote and develop trade ties with other states and regions according to the principle of equality and mutual benefits, conclude or take part in the Custom League Agreement and Liberal Trade Region Agreement and join in regional economic organizations.

Article 6 The People’s Republic Of China grants other contraction parties and participating parties with treatments such as the most favorable national treatment or national treatment etc based on international treaties or agreements to which the People's Republic of China is a contracting party or a participating party, or grant the counterpart with treatments such as the most favorable national treatment or national treatment etc, in accordance with the principles of mutual benefit and equality.

Article 7 The People’s Republic Of China shall take counter-measures to the country or region according to the practical situation if any country or region adopts a discriminative prohibition, restriction or other similar measures to The People’s Republic Of China in the field of trade.

Chapter II Foreign Trade Administrators

Article 8 The Foreign Trade Administrators mentioned in this law include the juridical persons, other organizations or individuals who went through the industry and commerce registration or other business operating procedures or were engaged in the foreign trade business under the provisions in this law or other relevant laws and administrative regulations.

Article 9 Any foreign trade administrator who intends to engage in the import and export of commodities or the import and export of technologies should be filed with the authority responsible for foreign trade under the State Council or its entrust agencies unless the provisions of the laws, administrative regulations and the authority responsible for foreign trade require no such procedure. The detailed measures for filing and recording are prescribed by the authority responsible for foreign trade under the Department of State.

If the foreign trade administrator fails to follow the registration procedure, the customs office has the right to reject the custom and check procedures of import and export of commodities.

Article 10 Anyone who engages in international service trade shall abide by the provisions in this law and other relevant laws and administrative regulations.

The unit that engages in foreign projects contracting or the foreign labor cooperation shall possess corresponding aptitude or qualification. The State Council shall prescribe the detailed measures.

Article 11 The State has the right to execute state-run trade administration of the import and export of commodities. The import and export of commodities under the state-run trade administration should be conducted by authorized enterprises, except the part of the import and export of commodities that can be conducted by non-authorized enterprises permitted by the state.

Commodities under the state-run trade administration and the catalogue of authorized enterprises shall be confirmed, adjusted and declared by the authority responsible for foreign trade under the State Council and other relevant authorities under the Department of State.

It is a violation of the provisions of the first clause of this article for Customs to pass import and export commodities under the state-run administration without permission.

Article 12 If a foreign trade administrator could accept other’s entrust, he could conduct foreign trade transactions within his own business scope.

Article 13 The foreign trade administrators should shall submit documentation and references related to foreign trade activities to relevant departments according to the provisions formulated by the authority responsible for foreign trade under the State Council or other authorities.

Chapter III Import and Export of Commodities and Import and Export of Technologies

Article 14 The State permits a free import and export of commodities and technologies except those that are forbidden by law and administrative regulations.

Article 15 The authority responsible for foreign trade under the State Council can exercise automatic permission to those commodities that are freely imported and exported and publicize the indices according to the demand of supervising the import and export.

To import and export commodities under the automatic permission, both the receiver and the deliver shall apply for the automatic permission prior to the custom declaration procedure. The authority responsible for foreign trade under the State Council and its entrust institute shall authorize the application; customs shall not pass commodities which have not received prior automatic permission approval.

A list of free range import and export items shall be entered at the authority responsible for foreign trade under the State Council and its entrust institute.

Article 16 The State is obliged to impose restriction or forbiddance on the import or export of commodities and technologies under any of the following circumstances:

(1) The import or export shall be restricted or forbidden for the maintenance of national security, public interest or social morality

(2) The import and export shall be restricted or forbidden to safeguard the health and safety of human beings or the life and safety of animals and plants or to protect the environment

(3) The import or export shall be restricted or forbidden in order to implement policies concerned with the import and export of gold and silver.

(4) The export of any natural resource that is in short domestic supply or extinction shall be restricted or forbidden

(5) The export shall be restricted due to limited market capacity of the target country or region

(6) The export shall be restricted because of serious confusion in the export order

(7) The import shall be restricted in order to establish or accelerate the establishment of a particular domestic industry

(8) The restriction of import shall be imposed on any form of agriculture, animal husbandry or fishery industry when deemed necessary

(9) The import shall be restricted in order to ensure national financial position and international balance between income and expenditure

(10) Other restricted or prohibited import or export according to laws and administrative regulations

(11) The import or export shall be restricted or prohibited according to the international treaties and agreements which our state ratifies or in which it is a signatory

Article 17 The State may take necessary measures to safeguard the national security in import and export of commodities and technologies concerned with fission and fusion materials or their ramification materials and the import and export of arms, ammunition or other military resource.

The state shall take any necessary measures in import and export of commodities and technologies in order to maintain international peace and safety in time of war.

Article 18 Authority responsible for foreign trade under the State Council and other divisions under the State Council formulate, adjust and promulgate the catalogue of the restricted or prohibited import and export of commodities and technologies, according to Article 16 and Article 17 of this law.

Having been approved by the State Council, the authority responsible for foreign trade under the State Council may, within the framework of Article 16 and Article 17, independently or in collaboration with the relevant authorities under the State Council, temporarily determine whether to impose restriction or prohibition on the import or export of particular commodities or technologies not included in the list mentioned in the preceding article.

Article 19 The state manages the restricted import or export of commodities by allotment and license; and manages the restricted import or export of technologies by license.

The commodities and technologies managed by allotment and license can only be imported or exported with the approval of the authority responsible for foreign trade under the State Council independently or in collaboration with the relevant authorities under the State Council according to the provisions promulgated by the State Council.

The state manages part of the imported commodities by tariff allotment.

Article 20 The allotment of imported commodities and tariff shall be allocated on the basis of the principles of transparency, impartiality, fairness and efficiency by the authority responsible for foreign trade under the State Council or the relevant authorities under the State Council within the range of their own responsibility. The detailed measures are prescribed by the State Council.

Article 21 The state exercises a uniform evaluation system of qualified commodities, and attests, checks and quarantines the import and export of those commodities according to the provisions of relevant laws and administrative regulations.

Article 22 The state administrates the original place of the imported and exported commodities. The detailed measures are prescribed by the State Council.

Article 23 The export and import of cultural relics, wild animals, plants and plant products, which are restricted or prohibited by other laws or administrative regulations shall be carried out according to the prescriptions in the related laws and administrative regulations.

Chapter IV International Service Trade

Article 24 The People’s Republic of China shall grant concluding or participating countries market entry permission and national treatment according to the international treaties and agreements on international service trade, which China concludes or joins in.

Article 25 The authority responsible for foreign trade under the State Council and other authorities under the State Council administrate the international service trade on a basis of the provisions in this law and other administrative regulations.

Article 26 The state is obliged to restrict or prohibit the international service trade under the following circumstances

(1) It shall be restricted or prohibited in order to maintain the national security, social interest or social morality.

(2) It shall be restricted or prohibited in order to safeguard the safety and health of human beings and lives and health of animals and plants

(3) It shall be restricted in order to establish or accelerate the establishment of special domestic service industry

(4) It shall be restricted in order to balance the income and expenditure of foreign exchange of our state

(5) Other international service trade shall be restricted or prohibited according to laws and administrative regulations

(6) Other international service trade shall be restricted or prohibited according the international treaties and agreements that our state concludes or joins in.

Article 27 The State take necessary measures to safeguard the national security in the international trade service concerned with fission and fusion materials or their ramification materials and the import and export of arms, ammunition or other military resource.

The state shall take any necessary measures in international service trade in order to maintain international peace and safety in time of war.

Article 28 The authority responsible for foreign trade and the relevant authorities under the State Council may establish, adjust and public the catalogue of the entry permission into the international service trade market access, according to the provisions of Article 26, Article 27 of this Law and other relevant laws and administrative regulations.

Chapter V Intellectual Property Protection Related to Foreign Trade

Article 29 The state shall protect the intellectual property related to foreign trade according to relevant laws and administrative regulations of intellectual property.

If the imported commodities infringe the intellectual property and injury the foreign trade order, the authorities responsible for foreign trade under the State Council is obliged to take measures to prohibit the production, sales and import of the infringing commodities.

Article 30 Where the obligee of intellectual property prohibits the licensee to raise any objection to the licensed intellectual property, impose comprehensively constraint license and stipulate exclusive instructing back conditions in the license contract and hence injury the fair competitive order of foreign trade, the authorities responsible for the foreign trade under the State Council may take necessary measures to eliminate the harm.

Article 31 If another country or region do not grant the juridical person, other organization or individual of People’s Republic of China with national treatment or cannot provide sufficient intellectual property protection of the commodities, technologies or service from the People’s Republic of China, the authority responsible for foreign trade under the State Council has the right to adopt necessary measures to trade of this country or region, according to this law and other relevant laws and administrative regulations and the international treaties and agreements that the People’s Republic of China concludes or joins in.

Chapter VI Foreign Trade Order

Article 32 In foreign trade activities, acts of violating the provisions of law and administrative regulations concerned with antitrust are prohibited.
Any monopoly acts in foreign trade activities that disrupt the market order of fair competition are dealt with in accordance with the provisions of law and administrative regulations concerned with antitrust.

If above illegal acts disrupt the foreign trade order, the authority responsible for foreign trade under the State Council may take necessary measures to eliminate the threats.

Article 33 In foreign trade activities, such unfair competition actions as the sale of merchandise at an unjust low price, collusive bidding, the publication of false advertise, business bribery and so on are prohibited.
Any unfair competition actions in foreign trade are dealt with in accordance with provisions of law and administrative regulations concerned with unfair competition.

If above illegal acts disrupt the foreign trade order, the authority responsible for foreign trade under the State Council may take such measures as prohibiting the imports and exports of commodities and technology concerned to eliminate the threats.

Article 34 In foreign trade activities, the following acts are prohibited:

1. fabricating or altering the mark of place of origin, the certificates of place of origin for importing and exporting commodities, import and export licenses, the certificate of imports and exports quota or other certification documents on imports and exports;

2. defrauding refund tax on export;

3. smuggling;

4. eluding the authentication, inspection and quarantine provided by provisions of law and administrative regulations concerned.

5. other acts violating the provisions of law and administrative regulations concerned.

Article 35 In foreign trade activities, foreign trade administrators shall abide by the provisions concerned with foreign exchange control provided by the State.

Article 36 If any illegal acts disrupt the foreign trade order, the authority responsible for foreign trade under the State Council may issue the bulletin to the public.
 
Chapter VII Foreign Trade Investigation

Article 37 In order to maintain the foreign trade order, the authority responsible for foreign trade under the State Council may, on its own or cooperating with other department concerned under the State Council, investigates the following matters in accordance with the laws and administrative regulations concerned:

1. the effect on domestic industries and their competitiveness of the imports and exports of commodities and technologies and international trade in services;

2. trade barriers by relevant countries or regions;

3. other matters needed investigating for the purpose of deciding whether foreign trade relief measures such as anti-dumping, anti-subsidy or guarantee measures shall be taken.

4. the acts of eluding foreign trade relief measures;

5. the matters concerned with the security and interests of the country in foreign trade;

6. the matters needed investigating for the execution of the provisions of Article 7, Paragraph 2 of Article 29, Article 30, Article 31, Paragraph 2 of Article32 and Paragraph 3 of Article 33.

7. the matters needed investigating that affect the foreign trade order.

Article 38 The authority responsible for foreign trade under the State Council issues the bulletin of initiating foreign trade investigation.
The investigation can be carried out in the form of written questionnaire, evidentiary hearing, on-the-spot inquiry, entrust investigation and so on.
In accordance with the result of investigation the authority responsible for foreign trade shall bring forward the investigation report or make out the ruling and issue the bulletin.

Article 39 The units and individuals concerned shall cooperate with our staff and assist the foreign trade investigation.

The authority responsible for foreign trade and other departments concerned under the State Council as well as their staff shall the obligation of confidentiality for the informed state and commercial secrets during the foreign trade investigation.

Chapter VIII Foreign Trade Relief

Article 40 In accordance with the result of investigation the State may take proper foreign trade relief measures.

Article 41 If the products from other countries or regions that enter the markets of China at a price lower than normal value in the way of dumping cause substantial harm or substantial menace of harm to established domestic industries or substantial obstacles to the establishment of domestic industries, the State may take anti-dumping measures to eliminate or mitigate the harm, menace of harm or obstacles.

Article 42 If the products from other countries or regions that enter the market of a third country at a price lower than normal value in the way of dumping cause substantial harm or substantial menace of harm to established domestic industries or substantial obstacles to the establishment of domestic industries, the authority responsible for foreign trade under the State Council may, upon the application of domestic industries, consult with the government of the third country and request it to take proper measures.

Article 43 If the importing products that have directly or indirectly received specific subsidy of any form from export countries or regions cause substantial harm or substantial menace of harm to established domestic industries or substantial obstacles to the establishment of domestic industries, the State may take anti-dumping measures to eliminate or mitigate the harm, menace of harm or obstacles.

Article 44 If the increase of the quantity of imported products causes severe harm or menace of severe harm to domestic industries that can produce the products of the same kind or the products of direct competitiveness, the State may take necessary measures to eliminate or mitigate the harm or menace of harm and give necessary support to these industries.

Article 45 If the increase of the quantity of the services provided by service providers of other countries or regions causes the harm or menace of harm to domestic industries that can provide the service of the same kind or the service of direct competitiveness, the State may take necessary relief measures to eliminate or mitigate the harm or menace of harm.

Article 46 If the increase of the quantity of the products that enter the markets of China due to the importing restriction by a third country causes the harm or menace of harm to established domestic industries or obstacles to the establishment of domestic industries, the State may take necessary measures to restrict the import of these products.

Article 47 If the countries or regions that have contracted or participated the economy and trade treaties or agreements violate the provisions of the treaties or agreements, which makes the interests enjoyed by the PRC under these treaties or agreements lost or damaged, or hinder the realization of the objectives of the treaties or agreements, the government of the PRC have the right to request relevant countries or regions to take proper relief measures and may suspend or terminate the performance of relevant obligations in accordance with the treaties or agreements concerned.

Article 48 In accordance with the provisions of this law and other relevant laws the authority responsible for foreign trade under the State Council may conduct foreign trade bilateral or multilateral consultation, negotiation and settlement of disputes.

Article 49 The authority responsible for foreign trade and other relevant departments under the State Council shall establish early warning and emergency meeting mechanism for the imports and exports of commodities, technologies and international trade in services to answer outburst and abnormal situations in foreign trade and maintain the security of national economy.

Article 50 The State may take necessary anti-circumvention measures to answer the acts of eluding the foreign trade relief measures provided by this law.

Chapter IX Promotion of Foreign Trade

Article 51 The State conducts the strategy of foreign trade development in order to establish and improve the foreign trade promotion mechanism.

Article 52 According to the requirement of foreign trade development the State establish and improve the financial mechanism of foreign trade service and set up the funds for foreign trade development and risks.

Article 53 The State develop foreign trade through imports and exports credit, export credit insurance and export tax refund as well as other means of promoting foreign trade.

Article 54 The State establishes foreign trade public information service system to provide information services for foreign trade administrators and other general public.

Article 55 The State takes measures to encourage foreign trade administrators to exploit the international market and develop foreign trade by such means as foreign investment, foreign project contraction, foreign service cooperation and so on.

Article 56 According to law foreign trade administrators can establish and join relevant associations and chambers of commerce.

Relevant associations and chambers of commerce shall abide by laws and administrative regulations, provide their members with relevant services of manufacture, marketing, information, training and so on, play the role of coordination and self-discipline, bring forward the application of foreign trade relief measures, maintain the interests of the industries and their members, reflect the advice on foreign trade by the members to relevant departments and carry on foreign trade activities.

Article 57 In accordance with the article of association the International Trade Promotion Organization of China carries on foreign communication, holds exhibitions, and provides information and inquiry services and other foreign trade promotion activities.

Article 58 The State shall support and promote medium and small-size enterprises to develop foreign trade.

Article 59 The State shall support and promote national autonomy areas and economically underdeveloped areas to develop foreign trade.

Chapter X Statutory Responsibility

Article 60 The authority responsible for foreign trade or other departments under the State Council may fine not more than ¥50,000 those who violate the provisions of Article 11 and import and export the commodities subjected to state-running trade administration without authorization; for those severe circumstances, can reject their applications of conducting the business of importing and exporting commodities subjected to the state-running trade administration within 3 years after the effectiveness of administrative punishment, cancel the authorization of importing and exporting the commodities subjected to the state-running trade administration.

Article 61 In accordance with relevant laws and administrative regulations by the custom those who import and export prohibited commodities or import and export restricted commodities without permission are dealt with and punished; if their acts constitutes criminal offenses, they will be found out criminal responsibility according to law.

In accordance with relevant laws and administrative regulations those who import and export prohibited commodities or import and export restricted commodities without permission are dealt with and punished; if not provided by the laws and administrative regulations, the authority responsible for foreign trade under the State Council may charge for correction, confiscate illegal income and fine more than one time but less than five times of illegal income; if illegal income is less than 10,000 Yuan, it will be fined more than 10,000 but less than 50,000 Yuan; if constituting criminal offenses, they will be found out criminal responsibility.

From the date of the effectiveness of administrative punishment decision or criminal punishment sentence on, the authority responsible for foreign trade or other departments under the State Council can reject the application of imports and exports quota or licenses put forward by the offenders within 3 years, or prohibit the offenders from conducting the business of importing and exporting the commodities and technologies concerned within more than a year but less than 3 years.

Article 62 In accordance with relevant laws and administrative regulations those who conduct prohibited international trade service or conduct restricted international trade service without permission are dealt with and punished; if not provided by the laws and administrative regulations, the authority responsible for foreign trade under the State Council may charge for correction, confiscate illegal income and fine more than one time but less than five times of illegal income; if illegal income is less than 10,000 Yuan, it will be fined more than 10,000 but less than 50,000 Yuan; if constituting criminal offenses, they will be found out criminal responsibility.

The authority responsible for foreign trade may prohibit the offenders from conducting relevant business activities related to international trade in services within three years after the date of effectiveness of the administrative punishment decision or criminal punishment sentence stipulated in above articles.

Article 63 Those who violate the provisions of Article 34 are punished In accordance with the laws and administrative regulations; if constituting criminal offenses, they will be found out criminal responsibility.

The authority responsible for foreign trade may prohibit the offenders from conducting business activities related to international trade in services within three years after the date of effectiveness of the administrative punishment decision or criminal punishment sentence stipulated in above articles.

Article 64 In accordance with the provisions of Article 61 to Article 63 in this law, for those who are prohibited from conducting business activities related to foreign trade, the Custom may reject transacting the procedures of custom clearance, check and pass and the Foreign Exchange Administration Agency or its designated banks may reject transacting the procedures of settlement of exchange and sale of foreign exchange.

Article 65 In accordance with this law, those personnel in charge of foreign trade neglect their duty and conduct self-seeking misconduct or abuse their power, if which constitutes criminal offenses, they will be found out criminal responsibility, if which does not constitute criminal offenses, they will be given administrative sanctions.

In accordance with this law, those personnel in charge of foreign trade take advantage of their job convenience to extort property from others or illegally receive others’ property and seek the interests for others, if which constitutes criminal offenses, they will be found out criminal responsibility, if which does not constitute criminal offenses, they will be given administrative sanctions.

Article 66 If foreign trade administrators remain unconvinced by specific administrative performance by the authority responsible for foreign trade administration in accordance with this law, they can, according to law, apply for administrative reconsideration or issue administrative litigation to people’s court.

Chapter XI Supplementary Provisions

Article 67 The laws and administrative regulations contain specific provisions for foreign trade management related to such things as military articles, fission and fusion substances or derived substances, which shall be applied.

Article 68 The State takes flexible measures for the trade between the border areas of China and the border areas of neighboring countries, gives priority and provides convenience. Specific provisions are regulated by the State Council.

Article 69 This Law is not applicable in separate custom areas of the PRC.

Article 70 This Law will go into effect on 1st July 2004.

 


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