1.CHINESE TAX EXEMPTION
1.1 The Exemption Process China
The exemption process usually begins with a new JV company being formed in china
between the foreign and local entities to cover the project. This company then puts together a master list of the material and equipment that they want to import and submits to the Government for Duty and Tax Exemption. If and when this is approved the JVcompany gets an Import License to bring in the listed items. The company and Import License are then registered with the Import License at the port of entry to be used and entered into what is known as Customs Blook Book. If more than one port of entry is to be used then the company must register separately at this port or ports.
Once the above is completed , and not before, you may import your project material with Duty * tax exemption. The name of the company holding the Import License must be designated as the Consignee on the project should obtain copies of the b/l, commercial can apply for the Import Permit – this normally takes 5-7 working days – but can be obtained in 3 days if the company is properly run and has right people. When the Import Permit is obtained the in country forwarder can then clear Customs with the following original documents:
Import Permit
Business License
Commercial Invoice
Bill of Lading
Packing List
Cargo Manifest
This applies to airfreight shipments as well.
Arch would like to stress that Shipper Owned Containers must be included in the material and equipment list supplied to the Government for Duty & Tax Exemption. If not the container/s are liable for duty & tax based on the Customs assessed value of the container/s. though the import is Duty Free the Customs documents all have to be completed just as with a standard import. In this case no duty or tax is paid however, so no time is saved in the actual documentation phase. Depending upon the fact that everything is in order and Customs does not physicall inspect the goods a shipment can be cleared in 3 days – which is the fastest time one can expect.
2.EXPORT / IMPORT PROCESS & DOCUMENTATION
Once the above procedures have been put in place shipments for the project can take place. Each shipment requires a separate import / export permit.
Ensuring an import permit is in place for each shipment is handled in the following manner. When a shipment is made the load port sends copies of the Bill of Lading, Commercial Invoice. And Packing List to the nominated forwarder in China who then contacts the project owner who holds the Duty & Tax Exemption permit . the project owner can then obtain the shipment import permit themselves with the documents supplied by the forwarder and provide the forwarder with the import permit and Duty Free registration book and a stamped letter of authorization that the forwarder can act on behalf of the Consignee. On receipt of these documents the forwarder will then complete the Customs application form and submit all documents for approval. This process will normally take 3-4 working days.
Once the shipment import permit is in place the clearance process can take place. Documents required are the import permit, Bill of Lading, Commercial Invoice, Packing List, and Cargo Manifest. If all the documents are in order and there are no problems clearance will be completed in 2-4 days, depending on how busy the port is.
All lst Class Forwarders / Customs brokers are on the Customs EDI net, but clearance is not process until hard copy documents are presented at the Customs window. All import have to clear Animal & Plant Quarantine Bureau, which is an integral part of the clearance3 procedures.
It is strongly recommended on all shipments into china that copies of the shipping documents are sent to the forwarders in-country project office in order that they can be checked for errors prior to the arrival of the vessel. The Import License of the PRC is extremely strict and clean, correct, documents are a prerequisite for all imports and exports
Projects and operations that involve the import of duty & tax free material to be used in manufacturing and re-exported can be handled by ARCH. The type of material and industry in which they will be used dictates the relevant Government bodies involved and who will issue the relevant permit. The forwarder is not normally involved in the initial discussions and license application as this is done at the time the company is formed. Also, there is difference in requirements between a JV company and WOFE. ARCH would be happy to assist where required and to provide advice on the aspects
of shipping and forwarding documentation. Obviously if the import documents are incorrectly handled or processed there will be problems at the time of export.
3 CHINA CUSTOMS PROCEDURE
3.1Presentation of Documents To The Customs Office
upon receipt of the copy documents a preliminary check is conducted, any discrepancies that are found are immediately brought to the attention of the concerned party and steps toward rectification are made.
At least four days before arrival of the vessel and upon submission of the manifest and original Bill of Lading, which will allow allocation of the ship rotation umber, a delivery order is collected from the ship’s agents in china. the delivery order is sent to the port authorities for obtaining direct delivery or storage, whichever is applicable. In case of indirect delivery, goods discharged from vessel are placed into port storage. Once vessel discharge is completed, any port handling charges involved are paid to the port authorities. The delivery order, together with storage location details, are then added to the Customs file and submitted to the Customs control department for verification of the documents, Customs inspection, exemption formality and finalization of duty (if applicable).
Once goods are exempted or duty is finalized and paid, shipments will be released by the Customs.
It should be noted that marks and numbers must be identical to those shown on the Bill of Lading and that they should occur on all individual packages(if items are shrink wrapped, marks should be shown on both internal package and external shrink wrapping)
Upon arrival of a vessel indirectly delivered good are offloaded onto the quay while direct delivered cargo is loaded onto the trucks arranged by ARCH. When Customs clearance formalities are completed suitable trucks are sent to the port for loading the indirect delivered cargo. If any damage is noted the matter will be brought to the attention of the Traffic Control Center China and a Company Project and Site representative for their views as far as claim procedures are concerned and also for arranging a preliminary survey at the port. In the meaning all non-damaged cargo will be loaded and moved to BHMC factory in an efficient and timely manner.
Receivers will be issued in advance of all deliveries and will always be kept advised of the delivery schedule for arranging suitable offloading facilities at the job site. Wherever a complete package is short landed, same will be brought to the attention of the above concerned parties. In this instance relative parties will be notified and held responsible for any discrepancies. A short-landing certificate will be obtained for use in any subsequent liens.
4.WOODEN PACKING REQUIREMENTS
4.1 The PRC has in force regulations covering solid wood packed goods coming to China from the USA, Canada, Japan, the European Union / EU and South Korea (solid wood being the packing materials to bear, pack, support, strengthen, bedding goods, expect such man-made boards such as plywood and fiberboard) are liable to the following regulations
A.The goods packed in conifer timber are required to have the inspection certificate issued by the official inspection branch or department of the USA, Canada, Japan, and the EU.
Note: This certificate is not the certificate of steamed and heart treatment. The Chinese inspection & quarantine bureau will inspect goods, which have this kind of certificate in hatches. They will let goods out if the results of inspection meet the required regulations, otherwise they will take some eliminating measures for unqualified goods.
B.For goods packed in non-conifer materials, there must be a correct “Declaration of Non-Conifer Packing” issued by the exporter to clear Quarantine & Customs.
Note: This declaration has a fixed format with a Chinese-English version. Forms to be obtained from the inspection & quarantine bureau will inspect the goods with this stype of declaration in spot batches, otherwise, they will take some eliminating measures for unqualified goods
C.For goods packed with no solid wood materials there must be a correct “Declaration of No Solid Wood Packing” issued by the exporter to clear Quarantine & Customs.
Note: This declaration has a fixed format with a Chinese-English version. Forms to be obtained from the inspection & quarantine branch of exporting country. The Chinese inspection & quarantine bureau will inspect the goods with this type of declaration in batches. They will release goods if the results of inspection meet the required regulations, otherwise they will take some eliminating measures for unqualified goods.
4.2 The Chinese inspection & quarantine bureau will refuse to inspect such goods that fail to supply the aforementioned correct certification or declaration of importation from the USA, Canada, Japan, and the EU. When inspecting the goods they will take note of exporter’s standing and will stress inspection for those companies whose records are not up to standard.
A.For goods which fail to supply the aforesaid correct certification and declaration the Chinese inspection & quarantine bureau will refuse to clear the shipment, destroy the solid wood packing or take some other eliminating measures. If the aforesaid actions are not permitted the shipment will be returned to the country of origin. All such expense will be for the account of the owner of the goods.
B. For importing goods from the USA, Canada, Japan, and the EU, whether or not it is included in “The Entry-Exit Inspection Catalogue’, the owner or his agent must make declaration to the inspection & quarantine bureau and clear the goods from Customs by the “Declaration of Entry Goods”. The goods, which are included in the aforementioned catalogues, will be handled in accordance with the original inspection & quarantine regulations.
