International Trade and Customs Affairs Newsletter, October, 2020

Adjustment of the Catalogue of Technologies Prohibited or Restricted by China from Import and Export
 

On August 28, 2020, the Ministry of Commerce and the Ministry of Science and Technology of China jointly issued the Catalogue of Technologies Prohibited or Restricted by China from Export (Announcement No. 38 of the Ministry of Science and Technology of the Ministry of Commerce, hereinafter referred to as the “Catalog”). This is the first adjustment of the Catalogue since 2008. The transfer of patent rights, patent application rights, technical secrets, patent implementation licenses, and the export of technical services are prohibited or restricted, including trade, investment or economic and technological cooperation.
 

Compared with the 2008 version of the Catalog, this revision includes:
 

1.Delete four prohibited export technical items: microbial fertilizer technology, chemical synthetic and semi-synthetic caffeine production technology, riboflavin (VB2) production technology, chemical synthesis and semi-synthetic drug production technology (vitamin fermentation technology).
 

2.Delete five technical items that restrict exports, including Newcastle disease vaccine technology, natural medicine production technology, biologically active functional polymer material preparation and processing technology, chemical synthesis and semi-synthetic medicine production technology, and information security firewall software technology.
 

3.Newly added 23 technical items restricted for export, including artificial breeding technology of agricultural wild plants, cashmere goat breeding and breed breeding technology, space material production technology, large-scale high-speed wind tunnel design and construction technology, aerospace bearing technology, and laser technology.
 

4.Modify the control points and technical parameters of 21 technical items, involving crop breeding technology, aquatic germplasm breeding technology, chemical raw material production technology, biological pesticide production technology, spacecraft measurement and control technology, space data transmission technology, map Graphics technology, information processing technology, vacuum technology and other fields.
 

In summary, forbidden technical items are only reduced but not increased, while restricted technical items have increased, decreased and adjusted. It is recommended that enterprises in related industries improve the technology export compliance system in accordance with the requirements of the Regulations of the People's Republic of China on the Administration of Technology Import and Export in accordance with the adjusted "Catalog".
 

The General Administration of Customs Adjusts the Supervision Requirements of Some Inbound and Outbound goods
 

On August 28, 2020, the General Administration of Customs issued the Announcement No. 99 of 2020 on Adjusting the Supervision Requirements for Some Import and Export Goods. The adjustment includes four kinds of imported goods: cultivation media, aquatic animals, aquatic products and cosmetics, and eight kinds of exported goods: feed, aquatic animals, grain, fruits, vegetables, meat, aquatic products and cosmetics for Hong Kong and Macao.
 

The specific adjustments of this announcement are as follows:
 

Inbound:
 

1.Cancel the regulatory requirements for the provision of pest quarantine reports for imported cultivation media for quarantine approval and the first import of cultivation media for risk assessment and sample inspection.
 

2.Cancel the supervision requirement for the staff of the entry aquatic animal isolation site to provide health certificates.
 

3.Cancel the regulatory requirements for the consignee or its agent to submit the certificate of origin of imported aquatic products to the customs at the port of import.
 

4.When going through the customs declaration procedures for imported cosmetics, imported cosmetics shall declare that they have obtained the sanitary license documents approved by the relevant competent departments of the state, and shall be exempted from submitting an approval certificate. For cosmetics for which the country has not implemented sanitation licenses or filings, the regulatory requirements for providing relevant safety assessment materials for substances that may have safety risks issued by relevant qualified institutions are cancelled, and product safety commitments are required.
 

Outbound:
 

1.Outbound feed and feed additive manufacturers who do not have registration requirements in the importing country or region are exempt from customs registration.
 

2.Cancel the regulatory requirements for exiting aquatic animal breeding farms to provide water quality monitoring reports and entering aquatic animal isolation farms to provide health certificates.
 

3.Cancel the regulatory requirement of providing a self-inspection qualification certificate for outbound grain declaration, and provide quality qualification declaration instead.
 

4.Cancel the regulatory requirements for the registration of outbound fruit orchards and packaging plants to submit to the local customs the inspection records of fruit toxic and hazardous substances.
 

5.Cancel the regulatory requirements for the submission of water quality inspection reports for production and processing water to the local customs for the Hong Kong and Macao vegetable production and processing enterprises when filing. Cancel the regulatory requirements for enterprises to submit raw materials for Hong Kong and Macao vegetable processing, shipping lists, and factory qualification certificates during customs declaration.

6.Cancel the self-inspection requirements of export production enterprises on the raw and auxiliary materials used in the processing of meat and aquatic products.
 

7.Cancel the supervision requirement that the feed fed to the export aquatic product farms comes from feed processing factories that have been filed by the customs.
 

8.Cancel the regulatory requirements for the filing management of export cosmetics manufacturers.
 

The above-mentioned adjustments have been implemented on the date of the announcement. Enterprises need to pay attention to the above- mentioned cancelled regulatory conditions when importing and exporting, and the rest will still be provided or declared in accordance with the original regulations.
 

Ministry of Commerce Promulgated the Provisions on the Unreliable Entity List
 

On September 19, 2020, the Ministry of Commerce of China issued the Provisions on the Unreliable Entity List (Ministry of Commerce Order No. 4 of 2020, hereinafter referred to as the "Regulation"), which will be implemented on the day of publication. This is a legislative implementation after the Ministry of Commerce proposed to establish a list of unreliable entities on May 31, 2019.
 

The key points of the Regulation are as follows:
 

1.Provision object: foreign entities, including foreign enterprises, other organizations or individuals of a foreign country.
 

2.Provision reasons:Foreign entities will be included in the unreliable list if they perform the following actions:
 

(1) Endangering national sovereignty, security or development interests of China;
 

(2)Suspending normal transactions with an enterprise, other organization, or individual of China or applying discriminatory measures against an enterprise, other organization, or individual of China, which violates normal market transaction principles and causes serious damage to the legitimate rights and interests of the enterprise, other organization, or individual of China.
 

3.Working mechanism: The working mechanism composed of relevant departments of the central state organs is responsible (currently the "Regulations" has not yet clarified which state departments are included in the specific mechanism. Combined with the handling measures in point 5 below, the responsible departments may include the Ministry of Commerce, Customs, and Immigration Bureau, Market Supervision Bureau, SAFE, etc.); the working mechanism office is located in the competent commercial department of the State Council.
 

4.The decisive factors included in the list:
 

(1)The degree of harm to China’s national sovereignty, security, and development interests;
 

(2) The degree of harm to the legitimate rights and interests of Chinese enterprises, other organizations or individuals;
 

(3)Whether it conforms to international trade Rules;

(4) Other factors that should be considered.
 

5. Treatment measures after being included in the list:
 

(1)Restrict or prohibit it from engaging in import and export activities related to China;
 

(2)Restrict or prohibit its investment in China;
 

(3)Restrict or prohibit its related personnel and transportation;
 

(4)Restrict or cancel the relevant personnel’s work permit, stay or residence qualification in China;
 

(5)Impose a corresponding amount of fines according to the severity of the circumstances;
 

(6)Other necessary measures.
 

6.Correction period after being included in the list: If the foreign entity is included in the list of unreliable entities and the correction period is specified in the announcement of the foreign entity, no action will be taken within the time limit; if the foreign entity fails to correct its behavior within the time limit, measures shall be taken.
 

The Regulations do not apply to specific countries or specific foreign entities. Which foreign entities are included in the list depends on whether the foreign entity itself has violated the behavior mentioned in point 2 above. If a foreign entity has the above-mentioned illegal acts, the working mechanism will strictly follow the “Regulations”, comprehensively consider various factors, and seriously and prudently decide whether to include it in the list and whether to take corresponding measures. Any decision to be included in the list or to take measures will be announced according to law.
 

The General Administration of Customs Publicly Solicits Comments on the Provisions of the Customs of the People's Republic of China on the Administration of the Commodity Classification of Imported and Exported Goods
 

On September 14, 2020, the General Administration of Customs issued the Provisions of the Customs of the People's Republic of China on the Administration of the Commodity Classification of
 

Imported and Exported Goods (Draft for Comment) (hereinafter referred to as the “Draft”) on its official website and notified the public for comments.
 

Compared with the revised version in 2014, the highlights of this Draft are as follows:
 

1.Article 2 of the Draft adds a clause that national standards related to import and export goods can be used as a reference for commodity classification, which highly affirms the reference value of national standards in commodity classification recognition based on departmental regulations. However, enterprises are reminded that the Draft has an attitude of reference to national standards as a basis for classification, which means that national standards are not legal basis, and customs may not refer to them.
 

2.The Draft adds relevant provisions on Appraisal Conclusions from Articles 10 to 13. The measures for the administration of Customs testing (order No. 176 of the General Administration of Customs), measures for the re-inspection of imported and exported commodities (revised in 2018), and the Customs laboratory methods of China (notice No. 201 of the General Administration of Customs in 2018) respectively stipulate the procedures and methods for conducting testing in order to determine the classification of commodities, as well as the rights and obligations of import and export consignees.
 

Compared with the above-mentioned additional clauses in the Draft, the content is more detailed. Therefore, the addition of the above provisions is not a new provision. It is worth noting that if the consignee or consignor has any objection to the appraisal conclusion as stipulated in the measures for the reinspection of import and export commodities, the customs shall make a decision on whether to reconsider on the 15th, and the Draft shortens the time limit to 10 days.
 

3.The Draft deletes the provisions of Articles 15 to 20 concerning the "pre-classification" system. The "pre-classification" system has now been replaced by the "pre-ruling" system. For specific enterprises, please refer to order no. 236 of the General Administration of Customs (order on the promulgation of the Interim Measures for the Administration of Customs Advance Rulings of the People's Republic of China) and Announcement No. 14 of 2018 (on the implementation of the interim measures for the Administration of Customs Advance Rulings of the People's Republic of China" ).
 

Announcement No. 40 [2020] of the Ministry of Commerce: Initiation of the Anti-dumping Investigation on Imported Polyvinyl Chloride Originating in the US
 

On September 25, 2020, Ministry of Commerce of the People’s Republic of China (the “MOFCOM”) issued Announcement No. 40 of 2020, making public its decision to initiate the anti- dumping investigation on imported polyvinyl chloride originating in the US.
 

On August 18, 2020, the MOFCOM received a petition for an anti-dumping investigation submitted by Xinjiang Zhongtai Chemical Co., Ltd., Xinjiang Tianye (Group) Co., Ltd., Shaanxi Beiyuan Chemical Industry Group Co., Ltd., Tianjin Dagu Chemical Co., Ltd. and Yibin Tianyuan Group Co., Ltd. (hereinafter referred to as “the petitioners”) on behalf of the domestic polyvinyl chloride industry. The petitioners requested the MOFCOM to conduct an anti-dumping investigation into the imported polyvinyl chloride originating in the US.
 

Pursuant to the Anti-Dumping Regulations of the People’s Republic of China, the MOFCOM examined the standing of the petitioners, the relevant information of the subject merchandise in the petition, the information of the domestic like products in Mainland China, the impact of the subject merchandise in the petition on the domestic industry, the relevant situation of the subject country, etc. and then decided to initiate the anti-dumping investigation on imported polyvinyl chloride from the US since September 25, 2020.
 

The product is classified under 39041090 in the Customs Import and Export Tariff of the People’s Republic of China. The dumping period of this investigation is from January 1, 2019 to December 31, 2019 and the injury period of the investigation is from January 1, 2016 to December 31, 2019.
 

Announcement No. 39 [2020] of the Ministry of Commerce: Mid-Term Review Ruling of Anti-dumping investigation on Imported Optical Fiber Preform Originating in Japan
 

On September 25, 2020, Ministry of Commerce of the People’s Republic of China (the “MOFCOM”) issued Announcement No. 39 of 2020, making public its determination of the mid- term review on imported optical fiber preform originating in Japan.
 

On August 19, 2015, the MOFCOM issued Announcement No.25 of 2015, deciding to impose the final anti-dumping measures against imported optical fiber preform originating in Japan and the U.S. for a period of two years as of the date of Announcement. On July 10, 2018, after the expiry review investigation, the MOFCOM issued the Announcement No.57 of 2018, deciding to continue imposing anti-dumping duties against imported optical fiber preform originating in Japan and the U.S. for a period of five years as of July 11, 2018. On September 27, 2019, upon the request of domestic optical fiber preform industry, the MOFCOM issued Announcement No.40 of 2019, deciding to initiate the mid-term review on the anti-dumping measures against imported optical fiber preform from Japan. The subject merchandise is optical fiber preform or fiber preform that is classified under 70022010 in the Customs Import and Export Tariff of the People’s Republic of China.
 

After review, the MOFCOM determined that, during the review period, there was dumping of imported optical fiber preform from Japan. In accordance with the Anti-dumping Regulations of the People's Republic of China, the Tariff Policy Committee under the State Council has decided to adjust the anti-dumping duties for imported optical fiber preform from Japan as of September 26, 2020.
 

The adjusted anti-dumping duty rates are as follows:
 

Announcement No. 37 [2020] of the Ministry of Commerce: Initiation of the Countervailing Investigation on Imported Certain Glycol Ehters Originating in the US
 

Announcement No. 33 [2020] of the Ministry of Commerce: Preliminary Determination of Countervailing Investigation on Imported NPA originating in the US
 

On September 4, 2020, Ministry of Commerce of the People’s Republic of China (the “MOFCOM”) issued Announcement No. 33 of 2020, making the preliminary determination of the countervailing investigation on imported n- Propanol, n-Propylalcohol, 1-Propanol, 1- Propylalcohol, Propan-1-ol, Ethylcarbinol or 1- Hydroxypropane (NPA for short) originating in the US.
 

On July 29, 2019, the MOFCOM issued Announcement No.35 of 2019, deciding to initiate countervailing investigation into the imported NPA originating in the US. The MOFCOM initially confirmed that the imported NPA originating in the US was subsidized and caused material damage to the domestic industry, and there was the causal link between the subsidy and damage.
 

In accordance with Article 29 and 30 of the Countervailing Regulation of the People’s Republic of China, the adoption of provisional countervailing measures was proposed by the Ministry of Commerce and decided on by the Tariff Policy Committee under the State Council upon the proposition of the Ministry of Commerce. From September 9, 2020, provisional countervailing measures will be taken against the imported NPA originating in the US in the form of levying provisional countervailing duty under the guarantee of caution money.

Contact

Lawyer:                                         Lawyer:                                                   Lawyer:

Zhao Jing                                        Ma RongHua                                            Zu JiaPei

Mobile:                                           Mobile:                                                     Mobile:

13911906253                                 13717655052                                             13810779581

E-mail:                                           E-mail:                                                       E-mail:

zhaojing@deheng.com                   maronghua@deheng.com                       zujiapei@deheng.com

Edited : Zhang Wanruo and Wang Yuqing