International Trade and Customs Affairs Newsletter November 2020

Release time:2020-11-12 15:20

China officially promulgated the Export Control Law of the People's Republic of China
 

On October 17, 2020, the Export Control Law of the People’s Republic of China was officially promulgated and will be implemented since December 1, 2020. This is the first specialized law in the field of export control. Before its promulgation, China's export control stipulations were scattered across different levels of laws and regulations.
 

The Export Control Law maintains the current export control stipulations, while there are new or strengthened stipulations. The main contents are as follows:
 

1.Expand the scope of controlled items. In addition to dual-use items, military products, nuclear and related items, the Export Control Law explicitly includes “item-related technical information and other data” in the category of controlled items.


2.Expand the interpretation of “export” behavior by bringing the transit, transshipment, transportation, and re-export of controlled items, or the exportation from special customs supervision areas such as bonded areas, export processing zones, etc., and bonded supervision sites such as export supervision warehouses, bonded logistics centers, etc. to overseas in the scope of control.
 

3.In addition to the current control list, the competent authority may take temporary control of items outside the list to respond to emergencies.
 

4.Implement comprehensive control principles and measures:
 

(1)In terms of subject, a franchise system is adopted for the management of the subject qualifications of export operators of controlled items. For example, an operator engaged in the export of military products shall obtain a military product export franchise qualification.


(2)In terms of objects, an export licensing system shall be adopted for the controlled items in the controlled list or temporary controlled items. In addition, with regard to goods, technologies and services other than the controlled items in controlled list and temporarily controlled items, if the export operator knows or should know or has been notified by the national export control authority that the relevant goods, technologies and services may endanger national security and interests, or used for the design, development, production, utilization or delivery of weapons of mass destruction, or are used for terrorist purposes, it should also apply to the national export control administration for an export license.


(3)End-user and end-use certification: When applying for an export license, the export operator shall submit end-user and end-use certification documents to the national export control administration. The certification documents shall be issued by the end user or the government agency of the country or region where the end user is located.


(4)List of importers and end users: The national export control management department shall include the importers and end users to the control list who violates end-user or end-use management requirements, may endanger national security and interests, and use controlled items for terrorist purposes. The national export control administrative department may take measures such as prohibiting and restricting the transactions of relevant controlled items, and ordering the suspension of the export of relevant controlled items. The Export Control Law also provides for the exception exemption and removal system of the control list. If export operators really need to conduct transactions with importers and end users included in the control list under certain circumstances, they can apply to the national export control management department. Importers and end users included in the control list can apply to the national export control administration for removal from the control list after taking corrective measures.
 

(5)Third parties: The Export Control Law stipulates that third parties engaged in agency, freight, delivery, customs declaration, third-party e- commerce transaction platforms and financial services shall not provide services for export operators who engage in violations of export control, otherwise they shall bear responsibility for such illegal acts.
 

5.Clarify the scope of illegal acts and increase the punishment for illegal acts. Export operators who conduct transactions with importers and end users included in the control list or conduct other illegal acts may be fined up to 20 times the amount of illegal business operation. If a crime is constituted, criminal responsibility shall also be investigated in accordance with the law.
 

6.For the first time, it has been clarified at the legal level that companies with a compliance system and good operating conditions can be granted general permits for export-related controlled items and other convenient measures by the national export control administration.
 

DHH recommends that companies:
 

1.Pay close attention to the release of controlled lists, control lists, unreliable entity lists and other documents. Sort out and check the items to be imported and exported, and determine whether the company's import and export items are controlled items;
 

2.Follow up the promulgation of relevant supporting laws, regulations and legal documents at all times and if necessary, consult professionals or competent authorities in advance;
 

3.Establish a corporate export compliance system, regularly organize employees to carry out export control compliance training, and regularly conduct export risk assessments and inspections so as to ensure the good operation of the corporate internal compliance review system.
 

Announcement No. 48 [2020] of the Ministry of Commerce: Preliminary Determination on Anti-dumping Investigation against Ethylene-Propylene- non-conjugated Diene Rubber from the US, Korea and the EU
 

On October 23, Ministry of Commerce of the People’s Republic of China (the “MOFCOM”) issued Announcement No. 48 of 2020, making public the preliminary determination on anti- dumping investigation against Ethylene-Propylene- non-conjugated Diene Rubber (“subject merchandise” or “EPDM”) from the US, Korea and the EU.
 

On June 19, 2019, the MOFCOM issued Announcement No. 29 of 2019, making public its decision to initiate an anti-dumping investigation against EPDM from the US, Korea and the EU.
 

The MOFCOM preliminarily determined that the subject merchandise dumped in China, domestic EPDM industry suffered material injury and there is casual link between the dumping and injury. The dumping margin of respondents is as below:
 

Name of Company

Dumping Margin

The US

The Dow Chemical Company

222.0%

Exxon Mobil Corporation

214.9%

ARLANXEO USA LLC

219.8%

Lion Copolymer Geismar,LLC

219.8%

All others

222.0%

Korea

KUMHO POLYCHEM Co.,Ltd.

12.5%

Lotte Versalis Elastomers Co.,Ltd.

21.1%

All others

24.5%

The EU

ARLANXEO Netherlands B.V.

18.1%

ExxonMobil Chemical France (ExxonMobil Chemical France Société par Actions Simplifiée)

14.7%

Versalis S.p.A

16.5%

All others

31.7%


Announcement No. 45 [2020] of the Ministry of Commerce: Preliminary Determination on Anti-dumping Investigation against Polyphenylene Sulfide from Japan, the US, Korea and Malaysia


On October 16, the MOFCOM issued Announcement No. 45 of 2020, making public the preliminary determination on anti-dumping investigation against Polyphenylene sulfide (“subject merchandise” or “PPS”) from Japan, the US, Korea and the EU.
 

Announcement No. 23 of 2019, making public its decision to initiate an anti-dumping investigation against PPS from Japan, the US, Korea and Malaysia.
 

The MOFCOM preliminarily determined that the subject merchandise dumped in China, domestic PPS industry suffered material injury and there is casual link between the dumping and injury. The dumping margin of respondents is as below:
 

Name of Company

Dumping Margin

Japan

Toray Industries, Inc

26.9%

DIC Corporation

27.3%

POLYPLASTICS CO., LTD

25.2%

Tosoh Corporation

25.6%

Lion Idemitsu Composites Co., LTD.

33.60%

Sumitomo Bakelite Co., Ltd

34.5%

All others

69.1%

The US

Solvay Specialty Polymers USA, LLC

214.1%

Fortron Industries LLC

220.9%

All others

220.9%

Korea

Toray Advanced Materials Korea Inc.

26.4%

SK Chemicals Co., Ltd

32.7%

All Others

46.8%

Malaysia

Polyplastics Asia Pacific Sdn. Bhd.

23.3%

DIC Compounds(Malaysia) Sdn. Bhd

40.5%

All Others

40.5%


Announcement No. 41 [2020] of the Ministry of Commerce: Initiation of the Countervailing Investigation on Imported Polyvinyl Chloride Originating in the US

 

On October 12, 2020, the MOFCOM issued Announcement No. 41 of 2020, making public its decision to initiate the countervailing investigation on imported polyvinyl chloride originating in the US.
 

On August 18, 2020, the MOFCOM received a petition for a countervailing 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 a countervailing investigation into the imported polyvinyl chloride originating in the US. Pursuant to the Countervailing Regulations of the People’s Republic of China, the MOFCOM delivered the consultation invitation to the US government on September 25 and conducted the consultation on October 13, 2020 with the US government.
 

According to the stipulations of the Countervailing 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 countervailing 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. 42 [2020] of the Ministry of Commerce: Initiation of Sunset Review on Polymide-6 slices Anti- dumping Measures from the US
 

On October 12, 2020, the MOFCOM issues public notice, deciding to initiate sunset review on polymide-6 slices anti-dumping measures from the US.
 

On October 12, 2009, the MOFCOM issued public notice, deciding to impose anti-dumping duties on polymide-6 slices from the US, Italy, Britain, France and Taiwan Region for five years since October 13, 2015. On October 12, 2015, the MOFCOM issued Announcement 37 of 2015, deciding to impose anti-dumping duties on polymide-6 slices from the US, Italy, France and Taiwan Region for five years and terminate the anti-dumping measures on polymide-6 slices from Britain.
 

On August 12, 2020, the MOFCOM received the petition submitted by Pingdingshan Shenma Engineering Plastics Co., Ltd on behalf of domestic polymide-6 slices industry. The petitioners claimed that, terminating the anti-dumping measures on polymide-6 slices from the US will cause the dumping to continue again or reoccur and the injury to domestic industry will continue again or reoccur. The petitioner asked the MOFCOM to continue the anti-dumping measures on polymide- 6 slices from the US.
 

After review, the MOFCOM decided to initiate the sunset review on anti-dumping measures on polymide-6 slices from the US. The dumping POI of the review is from January 1, 2019 to December 31, 2019 and the dumping POI of the review is January 1, 2015 to December 31, 2019.
 

Announcement No. 43 [2020] of the Ministry of Commerce: Termination of the Anti-dumping Investigation against Methionine from Singapore, Malaysia and Japan
 

On October 9, 2020, the MOFCOM issues public notice No. 43 of 2020, deciding to terminate the anti-dumping investigation against methionine from Singapore, Malaysia and Japan.
 

On April 10, 2019, the MOFCOM issued public notice No. 16 of 2019, deciding to initiate an anti- dumping investigation against methionine from Singapore, Malaysia and Japan.
 

On March 25, the MOFCOM issued public notice No. 6 of 2020, deciding to extend the investigation period to October 10, 2020.
 

On September 21, 2020, the petitioner submitted application, requesting to withdraw the investigation against the subject merchandise and terminate the anti-dumping investigation. After review, the MOFCOM decided to terminate the anti-dumping investigation against methionine from Singapore, Malaysia and Japan.
 

Contact

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Zhao Jing                                        Ma RongHua                                            Zu JiaPei

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Edited : Zhang Wanruo and Wang Yuqing

 

This is legal information provided by DHH to clients and other lawyers. The information contained in this letter shall not be regarded as a legal opinion of DHH or its attorneys. If you are interested in learning more about the content of this newsletter, please contact an attorney practicing in this field.