Foreign Trade Law of the People's Republic of China

    Passed on May 12,1994 during the 7th meeting of the Standing¹ Committee of the Eighth National People's Congress and amended² during the 8th meeting of the Standing Committee of the Tenth National People's Congress on April 6,2004

    Index

    Chapter One: General Provisions

    Chapter Two: Foreign Trade Operator

    Chapter Three: Import and Export of Goods and Technologies

    Chapter Four: International Service Trade

    Chapter Five: Trade-related Intellectual Property Protection

    Chapter Six: Foreign Trade Order

    Chapter Seven: Foreign Trade Investigation³

    Chapter Eight: Foreign Trade Relief

    Chapter Nine: Foreign Trade Promotion⁴

    Chapter Ten: Legal Liabilities

    Chapter Eleven: Supplementary⁵ Provisions

    Chapter One: General Provisions

    Article 1. This Law is promulgated⁶ with a view to enhancing the opening-up to the outside world, developing foreign trade, maintaining order in foreign trade activities and promoting a healthy development of socialist⁷ market economy.

    Article 2. This Law shall be applicable to foreign trade and trade-related intellectual property protection.

    The term foreign trade in this Law shall refer to the import and export of goods and technologies and international service trade.

    Article 3. The department in charge of foreign trade under the State Council shall take charge of all foreign trade work in the whole country in accordance with this Law.

    Article 4. The State shall adopt a unified⁸ foreign trade system, encourage foreign trade development and safeguard a fair and free foreign trade order.

    Article 5. The People's Republic of China shall promote and develop trading relations with all other countries and regions, establish or participate in agreements of tariff⁹ unions, free trade agreements and other regional economic and trade agreements and participate in regional economic organizations in the principle of equality and mutually beneficial.

    Article 6. In foreign trade, the People's Republic of China shall, in accordance with the international treaties or agreements that she has signed or entered into, grant the contractual parties and participants the most favor nation or national treatment of China, or grant the most favor nation or national treatment of China to the counterparts in accordance with the principle of mutually beneficial and equality.

    Article 7. The People's Republic of China shall have the right to adopt, in accordance with the actual circumstances, corresponding measures against any country or region to counter their discriminatory measures on the banning, restriction¹⁰ or other similar acts in trading with the People's Republic of China.

    Chapter Two: Foreign Trade Operator

    Article 8. The term foreign trade operator in this Law shall refer to a legal person or other organization or individual engaged in foreign trade activities that have gone through the industry and commerce registration¹¹ or other business formalities in compliance¹² with the provisions of this Law and other laws and administrative¹³ rules.

    Article 9. A foreign trade operator engaged in import and export of goods or technologies shall make registration for record with the department in charge of foreign trade under the State Council or institutions entrusted¹⁴ by it; but those that are exempted¹⁵ from registration for record by laws, administrative rules and rules of the department in charge of foreign trade under the State Council shall be excluded. The detailed¹⁶ rules on the registration for record shall be stipulated¹⁷ by the department in charge of foreign trade under the State Council. Customs shall not handle the declaration and clearance¹⁸ procedure for goods imported or exported by a foreign trade operator who fails to go through the registration for record in accordance with the rules.

    Article 10. The operation of international service trade shall abide¹⁹ by the provisions of this Law and other relevant laws and administrative rules. Organizations engaged in the undertaking²⁰ of overseas projects or overseas labor²¹ collaboration²² shall possess the corresponding capability²³ or qualifications. The detailed rules shall be promulgated by the State Council.

    Article 11. The State may place the import and export of certain goods under the administration of state-trading regime. Import and export of goods subject to state-trading regime may only be handled by the authorized²⁴ enterprises; but, the certain volume of goods subject to state-trading regime that is permitted by the State to be imported or exported by non-authorized enterprises shall be excluded from the administration of state-trading regime. Catalogues for the goods subject to state-trading regime and list of the authorized enterprises shall be drawn²⁵ up, adjusted and published by the department in charge of foreign trade under the State Council in consultation²⁶ with other relevant departments under the State Council. Goods subject to state-trading regime imported or exported without permission and in violation²⁷ of this Article shall not be cleared by the Customs.

    Article 12. A foreign trade operator may accept entrustment²⁸ from others to conduct foreign trade within its business scope by acting²⁹ as an agent.

    Article 13. A foreign trade operator shall provide documents and materials related to its foreign trade activities to the relevant departments in accordance with the rules that are stipulated by the department in charge of foreign trade under the State Council or other relevant departments under the State Council according to laws. The relevant departments shall undertake to protect the commercial secrets of the foreign trade operator.

    Chapter Three: Import and Export of Goods and Technologies

    Article 14. The State shall allow the free import and export of goods and technologies, except otherwise provided for by other laws and administrative rules.

    Article 15.The department in charge of foreign trade under the State Council may place certain goods of free import and export under the administration of automatic licensing³⁰ regime and publish the catalogues in view of the need to monitor the import and export situation. For importing and exporting of goods subject to automatic licensing regime, if consigners or consignees file applications for automatic licensing before the customs declaration, the department in charge of foreign trade under the State Council or institutions entrusted by it shall approve the applications; the Customs shall not clear the goods without going through the formality of automatic licensing. Contracts of importing or exporting technologies subject to automatic import and export shall be registered for record with the department in charge of foreign trade under the State Council or the institutions entrusted by it.

    Article 16. The State may restrict or ban the import or export of goods or technologies due to the following reasons: Being necessary to restrict or ban the import or export because of national security, public interests or public ethics³¹; Being necessary to restrict or ban the import or export in view of protecting the health or safety of the people, life or health of animals and plants and the ecological³² environment; Being necessary to restrict or ban the import or export in view of implementing³⁴ the measures on import and export of gold or silver; Being necessary to restrict or ban the export because of shortage of supplies at home or as important natural resources that are of danger of depletion³⁵; Being necessary to restrict the export as the limited market in the importing countries or regions; Being necessary to restrict the export due to the severe disruption in the export order; Being necessary to restrict the import by the State to establish or accelerate to establish certain industries at home; Agricultural, animal husbandry and fishery products in any form that are necessary to be restricted of importing by the State; Being necessary to restrict the import by the State in view of maintaining the financial position of the country in the world or ensuring a balance of international payments; Being necessary to restrict or ban the import or export due to other reasons in accordance with laws and administrative rules; and Subject to restriction or ban of import and export by international treaties or agreements to which the People's Republic of China is a signatory or has entered.

    Article 17. The State may take any necessary measures on the import and export of goods and technologies related to fissile and fusion³⁶ matters or matters that may derive³⁷ these matters and import and export of weapons and ammunitions and other materials for military use to protect the security of the State. At wartime or to maintain world peace and security, the State may take any necessary measures concerning the import and export of goods and technologies.

    Article 18. The department in charge of foreign trade under the State Council shall, in consultation with other relevant departments under the State Council, draw up, revise and publish the catalogues of goods and technologies whose import or export are restricted or banned in accordance with the provisions of Article 16 and 17 of this Law. The department in charge of foreign trade under the State Council may, independently or in consultation with other relevant departments under the State Council, make decisions to provisionally restrict or ban the import or export of special goods or technologies that are not listed in the afore-mentioned catalogues within the provisions of Article 16 and 17 of this Law.

    Article 19. The State implements³⁸ quota³⁹ or licence administration on goods whose import or export is restricted; and licence administration to technologies whose import or export is restricted. Goods and technologies subject to quota or licence administration can be imported or exported only when it has been approved by the department in charge of foreign trade under the State Council independently or in consultation with other relevant departments under the State Council in accordance with the provisions promulgated by the State Council. The State may implement³³ tariff quota administration on the import of certain goods.

    Article 20. The import and export quotas⁴⁰ shall be allocated⁴¹ by the departments in charge of foreign trade under the State Council or by other relevant departments under the State Council within their terms of reference in line with the principle of open, fair, just and efficiency. The detailed measures of quota allocation shall be worked out by the State Council.

    Article 21. The State implements a unified appraisal⁴² system on the quality of goods by conducting accreditation⁴³, inspection⁴⁴ and quarantine on imported and exported goods in accordance with the provisions of the relevant laws and administrative rules.

    Article 22. The State implements the country of origin administration on the imported and exported goods. The detailed rules shall be worked out by the State Council.

    Article 23. For cultural relics⁴⁵, wild animals and plants and their products whose import and export are banned or restricted according to other laws and administrative rules, the provisions of other laws and administrative regulations shall apply.

    Chapter Four: International Service Trade

    Article 24. In the context of international service trade, the People's Republic of China shall grant other signatories and participants market access and national treatment in accordance with the commitments made in the international treaties and agreements to which China is a signatory or a participant.

    Article 25. The department in charge of foreign trade under the State Council and other relevant departments under the State Council shall exercise administration on international service trade in accordance with this Law and other relevant laws and administrative rules.

    Article 26. Restrictions⁴⁶ or bans may be imposed on the international service trade by the State in view of the following reasons: Being necessary to restrict or ban because of national security, public interests or public morals; Being necessary to restrict or ban to protect the health or safety of the people, life or health of animals and plants and the ecological environment; Being necessary to restrict to establish or accelerate to establish certain domestic service industries; Being necessary to restrict by the State to maintain the balance of foreign exchange payment; Being necessary to restrict or ban due to other reasons in accordance with laws and administrative rules; and Other restrictions or ban provided for by the international treaties or agreements to which the People's Republic of China is a signatory or has entered.

    Article 27. The State may take any necessary measures on the international service trade related to military purposes and international service trade related to fissile and fusion matters or matters that may derive these matters to safeguard the State security. At wartime or to maintain world peace and security, the State may take any necessary measures concerning the international service trade.

    Article 28. The department in charge of foreign trade under the State Council shall, in consultation with other relevant departments under the State Council, draw up, revise and publish the catalogues of market access for international service trade in accordance with the provisions of Article 26 and 27 of this law and other relevant laws and administrative rules.

    Chapter Five: Trade-related Intellectual Property Protection

    Article 29. The State shall protect trade-related intellectual property in accordance with laws and administrative rules on intellectual property. For imported goods that infringe⁴⁷ upon intellectual property and disrupt foreign trade order, the department in charge of foreign trade under the State Council may take measures as ban of import of the relevant goods produced or sold by the people who infringe upon the intellectual property within a certain period.

    Article 30. Should the person who holds the intellectual property have any one of acts as forbidding the concessionaire from questioning on the effectiveness of the intellectual property in the concession⁴⁸ contract, imposing⁴⁹ package concession or inserting terms of exclusive re-granting in the concession contract and the act disrupt the fair competition order in foreign trade, the department in charge of foreign trade may take necessary measures to eliminate the disruption.

    Article 31. Should other countries or regions fail to grant the legal persons, other organizations or individuals from the People's Republic of China national treatment, or not be able to provide effective intellectual property protection to the goods, technologies or services originating from the People's Republic of China, the department in charge of foreign trade under the State Council may take necessary measures on the trade with the countries or regions in accordance with this Law and other relevant laws and administrative regulations and in line with the international treaties and agreements that People's Republic of China has signed or entered into.

    Chapter Six: Foreign Trade Order

    Article 32. In the operation of foreign trade, monopolistic activities in violation of anti-trust laws and administrative rules shall not be conducted. Monopolistic activities in the operation of foreign trade that disrupt the fair market competition shall be punished in accordance with the laws and administrative rules on anti-trust. For the afore-mentioned activities violating laws and disrupting the foreign trade order, the department in charge of foreign trade under the State Council shall take necessary measures to eliminate the disruption.

    Article 33. In the operation of foreign trade, illegitimate business operations such as selling products at unreasonable⁵⁰ low prices, colluded bidding, disseminating⁵¹ advertisements containing false contents and offering bribe⁵² in commercial activities shall not be conducted. The illegitimate business operations in foreign trade shall be punished in accordance with the laws and administrative rules on anti-illegitimate competition. For the afore-mentioned activities violating laws and disrupting the foreign trade order, the department in charge of foreign trade under the State Council may ban the import and export of the relevant goods and technologies conducted by the operators to eliminate the impairment.

    Article 34. In the operation of foreign trade, the following activities shall be prohibited: Falsifying, modifying certificates of country of origin, falsifying, modifying or trading in certificates of country of origin and import and export licences, import and export quota certificates or other import and export documents; Obtaining export rebate⁵³ by deception⁵⁴; Smuggling⁵⁵ or trafficking; Evading⁵⁶ accreditation, inspection and quarantine required by laws and administrative rules; and Committing acts that violate the provisions of other laws and administrative rules.

    Article 35. In the operation of foreign trade, regulations on foreign exchange promulgated by the State shall be abided by.

    Article 36. The department in charge of foreign trade under the State Council may publish notifications to the public on activities that violate this Law and disrupt foreign trade order.

    Chapter Seven: Foreign Trade Investigation

    Article 37. To maintain the foreign trade order, the department in charge of foreign trade under the State Council may, independently or in consultation with other relevant departments under the State Council, conduct investigations⁵⁷ on the following matters: Import and export of goods, import and export of technologies and international service trade's impact on domestic industries and their competitiveness; Relevant countries and regions' trade barriers; Matters that are necessary to be investigated to decide whether or not to adopt such foreign trade relief measures as anti-dumping, anti-subsidy⁵⁸ and safeguards in accordance with laws; Acts that circumvent⁵⁹ foreign trade relief measures; Issues concerning state safety and interests in foreign trade; Matters that are necessary to be investigated to implement Article 7, ii of Article 29, Article 30, 31, iii of Article 32 and iii of Article 33; and Other matters that disrupt foreign trade order and are necessary to be investigated.

    Article 38. The department in charge of foreign trade under the State Council shall issue notifications to initiate⁶⁰ foreign trade investigations. The investigation may be conducted in the form of written questionnaire, hearing, on-the-spot investigation and entrusted investigation. The department in charge of foreign trade under the State Council shall present investigation report or render rulings and publish notifications according to the outcome of the investigations.

    Article 39. The relevant workplaces and individuals shall cooperate and assist the foreign trade investigation. The department in charge of foreign trade under the State Council and other relevant departments under the State Council and their staff shall undertake to protect the state and commercial secrets that they are aware of or familiar with.

    Chapter Eight: Foreign Trade Relief

    Article 40. The State may take corresponding foreign trade relief measures according to the outcome of foreign trade investigation.

    Article 41. Should products originating from other countries or regions enter the Chinese market at price below-the-normal-value or dumping, which causes material injury or threat of such material injury to an established domestic industry or causes material barrier to the establishment of a domestic industry, the State may take anti-dumping measures to eliminate or mitigate⁶¹ such injury or the threat of injury or barrier.

    Article 42. Should products originating from other countries or regions be exported to the market of the third country at price below-the-normal-value, which causes material injury or threat of such material injury to an established domestic industry or causes material barrier to the establishment of a domestic industry, upon the petition filed by a domestic industry, the department in charge of foreign trade under the State Council may conduct consultation with the government of the third country and request it to take corresponding measures.

    Article 43. Should the imported products directly or indirectly⁶² accept the exclusive subsidy in any form offered by the exporting countries or regions, which causes material injury or threat of such material injury to an established domestic industry or causes material barrier to the establishment of a domestic industry, the State may take anti-subsidy measures to eliminate or mitigate such injury or the threat of injury or barrier.

    Article 44. Should the substantially increasing import cause material injury or threat of material injury to the domestic industry that produces like-products or directly competing products, the State may take necessary safeguard measures to eliminate or mitigate such injury or the threat of injury and provide necessary support to the industry.

    Article 45. Should the increasing service provided by service providers from other countries or regions cause material injury or threat of such material injury to a domestic industry that provide the same service or directly competing service, the State may take relief measures to eliminate or mitigate such injury or the threat of injury.

    Article 46. Should the import of a certain product increase substantially due to the restriction of import exercised by the third country, which causes material injury or threat of such material injury to an established domestic industry or causes material barrier to the establishment of a domestic industry, the State may take necessary relief measures to limit the import of the product.

    Article 47. Should a country or region that has signed with the People's Republic of China or jointly⁶³ entered into economic and trade treaties and agreements violate the provisions of the treaties or agreements and thus lead to losses or impairment of the interests that are enjoyed by the People's Republic of China in accordance with the treaties and agreements, or hamper⁶⁴ the realization⁶⁵ of the purposes set forth⁶⁶ in the treaties or agreements, the People's Republic of China has the right to request the governments of the relevant countries or regions to take corresponding remedial measures and suspend or terminate the fulfillment of the relevant responsibilities in accordance with the relevant treaties or agreements.

    Article 48. The department in charge of foreign trade under the State Council shall conduct the bilateral⁶⁷ or multilateral consultations⁶⁸, negotiations⁶⁹ and dispute settlement in accordance with this Law and other relevant laws.

    Article 49. The department in charge of foreign trade under the State Council and other relevant departments under the State Council shall establish a pre-warning and response mechanism⁷⁰ on the import and export of goods, import and export of technologies and international service trade to counter the unexpected and unusual situations and safeguard state economic safety.

    Article 50. The State may take necessary anti-circumvention measures to the acts that circumvent the foreign trade relief measures provided for by this Law.

    Chapter Nine: Promotion of Foreign Trade

    Article 51. The State shall draw up the foreign trade development strategy, establish and perfect the foreign trade promotion mechanism.

    Article 52. The State shall, in accordance with the need of foreign trade development, make efforts to set up and improve special financial institutions that are to serve foreign trade as well as establish development and risk funds for the trade.

    Article 53. The State shall adopt various promotion measures to develop foreign trade including issuing of import and export credits, export credit insurance and setting up of export rebates⁷¹.

    Article 54. The State shall establish foreign trade public information service system to provide information to foreign trade operators and other social mass people.

    Article 55. The State shall take measures to encourage foreign trade operators to explore the international market, take such measures as overseas investment, undertaking of overseas projects and overseas labor collaboration to develop foreign trade.

    Article 56. Foreign trade operators may establish or enter into the relevant associations and chambers⁷² of commerce in accordance with laws. The relevant associations and chambers of commerce shall abide by laws and administrative rules, provide the members with services related to production, marketing⁷³, information and training according to the articles of association, perform the function of coordination⁷⁴ and self-discipline, file petitions for foreign trade relief measures in accordance with laws, safeguard the interests of their members and industry, convey to the relevant government departments proposals on promoting foreign trade and carry out foreign trade promotion activities.

    Article 57. Chinese organizations for the promotion of international trade shall according to their articles of association, develop contacts with overseas businesses, hold exhibitions, provide information and consultancy services and engage in other foreign trade promotion activities.

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

    Article 59. The State shall make special efforts to promote the foreign trade in ethnic⁷⁵ autonomous⁷⁶ regions and economically less developed areas.

    Chapter Ten: Legal Liabilities

    Article 60. For import and export of goods subject to state-trading regime without permission in violation of Article 11 of this Law, the department in charge of foreign trade under the State Council or other relevant departments under the State Council may impose a fine of 50,000 yuan or less; for a serious case, the application for import and export of goods subject to state-trading regime filed by the law-breaker shall not be accepted within three years as of the date when the administrative punishment enters into effect or his right to conduct the import and export of other goods subject to state-trading regime shall be revoked⁷⁷.

    Article 61. Import and export of goods that are banned from import or export or import and export of goods that are restricted for import and export without permission shall be handled and punished by the Customs in accordance with the provisions of laws and administrative rules; if crime is constituted, the criminal liabilities shall be ascertained⁷⁸. Import and export of technologies that are banned from import or export or import and export of technologies that are restricted for import and export without permission shall be handled and punished in accordance with the provisions of laws and administrative rules; if the act is not provided for by laws and regulations, the department in charge of foreign trade under the State Council shall order the act to be rectified⁷⁹, confiscate⁸⁰ the illegal gains and impose a fine of more than one time but no more than five times of the amount of the illegal gains, if there is no illegal gains achieved or the illegal gains is less than 10,000 yuan, the fine shall be between 10,000 and 50,000 yuan; if crime is constituted, the criminal liabilities shall be ascertained. The department in charge of foreign trade under the State Council or other relevant departments under the State Council may refuse to accept the application filed by the law-breaker for import and export quota or licence within three years as of date when the administrative punishment provided for by the above two paragraphs enters into force or when the criminal punishments enter into force, or forbid the law-breaker from operation of import and export of goods and technologies for more than one year but less than three years.

    Article 62. Undertaking of banned international service trade, or undertaking of restricted international service trade without permission shall be punished in accordance with the relevant laws and administrative rules, the department in charge of foreign trade under the State Council shall order the act to be rectified, the illegal gains shall be confiscated⁸¹ and a fine of more than one time but no more than five times of the amount of the illegal gains shall be imposed, if there is no illegal gains achieved or the illegal gains is less than 10,000 yuan, the fine shall be between 10,000 and 50,000 yuan; if crime is constituted, the criminal liabilities shall be ascertained. The department in charge of foreign trade under the State Council may forbid the law-breaker from operation of the relevant international service trade for more than one year but less than three years as of the date when the administrative punishment provided for by the above paragraph enters into force or when the criminal punishment enters into force.

    Article 63. Acts in violation of Article 34 of this Law shall be punished in accordance with the relevant laws and administrative rules; if crime is constituted, the criminal liabilities shall be ascertained. The department in charge of foreign trade under the State Council may forbid the law-breaker from operation of the relevant foreign trade for more than one year but less than three years as of the date when the administrative punishment provided for by the above paragraph enters into force or when the criminal punishment enters into force.

    Article 64. In accordance with Article 61 to 63 of this law, the Customs shall not handle the declaration and clearance procedure for the goods imported or exported by foreign trade operators who are forbidden from operation of foreign trade in accordance with the forbidding decision made by the department in charge of foreign trade under the State Council, foreign exchange administrations or banks designated to deal with foreign exchange shall not handle the relevant foreign exchange settlement and purchase for them.

    Article 65. If staff with the departments in charge of foreign trade are found committing dereliction of duty, resorting to deception for personal gains or abusing their powers, if crime is constituted, the criminal liability shall be ascertained; otherwise, administrative punishments shall be meted⁸² out. If staff with the departments in charge of foreign trade are found taking advantage of his/her position to extort⁸³ belongings⁸⁴ from others or seek interests for others after accepting benefits, if crime is constituted, the criminal liability shall be ascertained; otherwise, administrative punishments shall be meted out.

    Article 66. Foreign trade operators who hold dissents⁸⁵ to the administrative decisions conducted by the departments in charge of foreign trade in accordance with this Law may apply for administrative review or file administrative litigation to the People's Count in accordance with laws.

    Chapter Eleven: Supplementary Provisions

    Article 67. If laws and administrative rules has other provisions on the foreign trade administration on goods for military use, fissile and fusion matters or matters that may derive these matters and import and export administration on cultural products, these provisions shall apply.

    Article 68. The State shall adopt flexible measures and grant preferential treatment and facilities to promote trade between towns of China and neighboring countries and trading among border residents at fairs within each other's territories. The detailed procedures shall be formulated⁸⁶ by the State Council.

    Article 69. This Law shall not apply to exclusive tariff areas of the People's Republic of China.

    Article 70. This Law shall enter into force as of July 1, 2004.

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