PROVISIONS OF THE CUSTOMS OF THE PEOPLE'S REPUBLIC OF CHINA FORASSESSMENT OF DUTY ON IMPORT AND EXPORT GOODS
PROVISIONS OF THE CUSTOMS OF THE PEOPLE'S REPUBLIC OF CHINA FORASSESSMENT OF DUTY ON IMPORT AND EXPORT GOODS
(Promulgated on January 3, 1989 by Decree No. 3 of the CustomsGeneral Administration)
Whole Doc.
Chapter I General Provisions
Article 1
The present Regulations are formulated in accordance with the Customs
Law of the People's Republic of China and the Regulations on Import and
Export Duties of the People's Republic of China, with a view to assessing
accurately the duty-paying value on import and export goods, preventing
duty evasion by fraudulent declaration of the value of import and export
goods, and protecting the duty payers' legal rights.
Article 2
The transaction value of import and export goods assessed by the
Customs shall be the normal price at which the goods could be bought on
the open market.
Article 3
The consignee of import goods, the consignor of export goods or his
or her deputy (hereinafter referred to as the declarant), shall be
responsible for submitting to the Customs all documents reflecting the
transaction activities to prove that the price of import and export goods
declared to the Customs are the normal transaction value or other fair
value.
The Customs has the right to inspect related contracts, invoices,
accounts, bills, business letters, documents and other data to confirm the
truthfulness of the declared value.
Article 4
While special economic relations between both parties of the
transaction being confirmed, the Customs may reject the transaction value
provided to the Customs by the declarant.
After the refusal of the transaction value referred in the above
paragraph, the declarant shall apply to the Customs the normal transaction
value.
Chapter II The Duty-paying Value of the Import Goods
Article 5
The duty-paying value of the import goods shall be assessed according
to the CIF price based on the normal transaction value verified by the
Customs.
Any sales commission which has been excluded from the transaction
value and additionally paid to the seller abroad during the course of
transactions shall be added to the transaction value of the goods.
Any normal sales commission paid by the seller abroad to the buyer in
China shall be deducted from the transaction value of the goods.
Any fine imposed on the seller for delaying the delivery of goods in
violation of the provisions set out in the contract shall not be deducted
from the transaction value if the seller has subtracted such a fine from
the value of the goods.
Article 6
When the transaction value of the goods to be imported cannot be
assessed after examination by the Customs, the duty-paying value shall be
the CIF price based on the normal transaction value of the identical or
similar goods imported from the same country or region.
The aforesaid identical goods means goods which are identical in all
aspects, including physical or chemical nature, quality and prestige,
however, minor disparities in surfaces or packings are allowed.
The aforesaid similar goods means goods which are not identical in
all aspects, but they shall be made in the same country or region, be of
similar characteristics and similar component materials, have same
use-value and also can be exchanged commercially.
Article 7
In case the provision of Article 6should not be applicable to the
goods in question, the duty-paying value shall be assessed in the light of
the wholesale price of the identical or similar import goods on the
domestic market, less the import duties levied and other taxes collected
in the process of importation, the normal charges for transaction and
storage after importation. The aforesaid business expenses and profits may
be calculated at 20 percent of the duty-paying value. The formula to
determine the duty-paying value shall be as follows:
Formula 1
Domestic wholesale price
Duty-paying value =---------
1+ Minimum import duty rate + 20%
Where such import goods are subject to the payment of product taxes,
VAT, or industrial and commercial consolidated taxes at importation
(referred to as the collected taxes in the formula), the formula to
determine the duty-paying value shall be as follows:
Formula 2
Duty- Domestic wholesale price
paying = -----------------
value main.import 1 + duty rate cellected
1 + ---- + ----- X taxes rate + 20%
duty reat 1 - collected
taxes rate
OR
Duty-Paying value =
Domestic wholesale price /
{ 1 + min.import / duty rate + (1 + duty rate) /
(1 - collected taxes rate) * collected taxes rate + 20% }
Article 8
In cases where the duty-paying value for goods cannot be determined
by provisions of Article 7, or where the Customs consider the price as too
low, the duty- paying value shall be assessed by the Customs in a
reasonable way.
When deemed necessary, the Customs shall take the minimum value as
the duty-paying value of some import goods.
Chapter III Duty-paying Value of Special Import Goods
Article 9
Where goods declared to the Customs for outward processing and
re-imported within the time limit specified by the Customs, the
duty-paying value of such goods shall be the difference between the CIF
price of the processed goods at importation and that of the original
goods, or the identical goods or similar goods at importation.
Where the CIF price of the original goods for outward processing at
the time of entry cannot be obtained, the FOB price of the goods at time
of declaration for exit may be used to determine the duty-paying value.
Where neither of the aforesaid procession value can be obtained, the
duty-paying value shall be the sum on the charges for procession, packing,
transport, insurance incurred before the unloading of the processed goods
at the entry port in China.
Article 10
Where mechanical appliances, means of transport or any other goods
declared to the Customs for repair abroad are reimported within the time
limit specified by the Customs, the normal repair charges and the cost of
materials and components used for the repair shall be the duty-paying
value after Customs verification.
Article 11
The duty-paying value for goods imported on lease or on hire shall be
the normal rent verified and ascertained by the Customs.
Where the rent for the import goods on lease is paid by one lump, the
duty-paying value shall be the CIF price of such imported goods verified
and determined by the Customs.
Article 12
The duty-paying value of import plates and negatives used for
printing advertisement in newspapers and magazines as well as on import
films and tapes, etc. used for advertising on TV programs shall be their
CIF price.
Article 13
Where construction machines, engineering vehicles, apparatus and
instruments used for installation, tele-cameras or cinecameras, containers
for holding goods for temporary admission are still remained in China for
use after 6 months, the Customs duties shall be imposed on them monthly
from the seventh month and the duty-paying value shall be assessed on the
basis of the CIF price at their temporary admission, the formula to
determine the amount of duties to pay each month shall be as follows:
Formula 3
Price of the goods at
The amount of duty = temporary admission X Duty rate X 1 / 48
Article 14
Where samples, exhibits or articles for advertising and display
temporarily admitted are purchased by a domestic unit, their duty-paying
value shall be the purchasing value.
However, where the buyer gives profits to the seller directly or
indirectly other than the purchasing money, the Customs may determine the
duty-paying value of such samples, exhibits or articles for advertising.
Article 15
For import machines and equipment, apparatus and instruments and
means of transport granted duty-and tax- reduction or exemption according
to the regulations concerning special duty-and tax-reduction and
exemption, the duty-reduction value thereof shall be assessed on the basis
of their existing residual value where they are subject to duty-and
tax-recovery due to transfer or resale.
Chapter IV Duty-paying Value of Export Goods
Article 16
The duty-paying value of export goods shall be the result of export
duties subtracted from the FOB price at which such goods are sold abroad
upon Customs verified. The formula for its calculation shall be as
follows:
Formula4
FOB price
Duty-paying value =-------
1 + Export duty rate
Article 17
Any commission other than the transaction value paid to a foreign
part shall be deducted from the duty-paying value. The commission which
has not been separately stated shall not be deducted the therefrom.
Packing charges paid by the buyer, other than the transaction value
of export goods, shall be added to the duty-paying value.
Chapter V Calculation of The Freight and Insurance Premiums in the Duty-paying Value of Import and Export Goods
Article 18
Any freight and insurance premiums included in the CIF price of
import goods shall be calculated as follows:
For goods imported by sea, the freight and insurance premiums
contained in the CIF price of import goods shall be counted up to the port
of unloading in China, or up to the port on an inland river in China where
the port of unloading is thereon; for goods imported by land, the freight
and insurance premiums contained in the CIF price of import goods shall be
counted up to the first port of entry. Where the freight, insurance
premiums and other costs contained in the transaction value are counted up
to the Chinese inland port of destination, those costs from the first port
of entry to the inland port of destination shall not be deducted; for
goods imported by air, the freight and insurance premiums contained in the
CIF price of import goods shall be counted up to the first port of entry.
Where the import goods are transported to the port other than the first
port of entry, the transaction value shall be counted up to the port of
destination.
Article 19
Where import goods are transacted at FOB a port outside the Customs
territory of China (including FOB or CIF a port outside the Customs
territory of China), to the FOB price shall be added the actually paid
freight and insurance premiums incurred from the port of shipping or
delivering outside the Customs territory of China up to a port inside the
Customs territory of China.
Where the amount actually paid cannot be determined, the freight and
insurance premiums thereof shall be calculated on the basis of the freight
rate (amount) and premium rate regulated by competent authorities. The
formula for calculating such insurance premiums shall be:
Formula 5
CIF price X premium rate
Where the transaction value is C&F a port inside the Customs
territory of China, the insurance premiums shall also be calculated
according to the preceding paragraph, i.e.:
Formula 6
C+F
Duty-paying value of import goods = -------
1-premium rate
Article 20
Where the insurance premiums of goods imported by land, air or post
cannot be determined, it may be determined by C&F x 0.3 percent.
Article 21
The actual FOB price of export goods shall be FOB the last port from
which such goods leave the Customs territory of China. Where the goods
shipped from an inland port, the freight incurred from the inland port
shipping to the port of exit shall be deducted from the FOB price.
Article 22
Where the transaction value of export goods is CIF or C&F a port
outside the Customs territory of China, the freight and insurance premiums
or the freight thereof shall be deducted from the CIF price of C&F price,
and the duty-paying value shall then be assessed according to the
specified formulas.
Chapter VI Sanctions
Article 23
Any duty evasion by rendering false contracts, invoices and other
documents by declarant of import or export goods and making fraudulent
declaration of the value of the goods, shall be investigated and affixed
in accordance with Articles 47 and 48 of the Customs Law of the People's
Republic of China.
False declarations caused by reasons other than which provided in the
proceeding paragraph shall be punished in accordance with Article 51 of
the Customs Law of the People's Republic of China.
Chapter VII Supplementary Article
Article 24
The present Regulations shall be explained by the Customs General
Administration.
Article 25
These Regulations shall go into effect on Sept. 1, 1992.
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