Measures of the General Administration of Customs of the People’s Republic of China on Inspection of Imported and Exported Goods, which were adopted at the Executive Meeting of the General Administration of Customs on December 8, 2005, are hereby promulgated and shall be effective as of February 1, 2006.

Mu Xinsheng

Minister

General Administration of Customs

December 28, 2005

Measures of the General Administration of Customs of the People’s Republic of China on Inspection of Imported and Exported Goods

(Adopted at the Executive Meeting of the General Administration of Customs on December 8, 2005, promulgated by Decree No.138 of the General Administration of Customs of the People’s Republic of China on December 8, 2005, and effective as of February 1, 2006)

Article 1 These Measures are formulated in accordance with the Customs Law of the People's Republic of China and other related laws and administrative regulations for the purposes of regulating Customs inspection of imported and exported goods and verifying the conditions of imported and exported goods.

Article 2 The term “inspection of imported and exported goods” (hereinafter referred to as “inspection”) in these Measures refers to the law enforcement act in which Customs carries out verification of the actual imported and exported goods so as to determine whether the contents declared by the consignee or consigner of imported and exported goods match with the actual imported and exported goods or to determine the classification, valuation and origin of the goods.

Article 3 The inspection shall be jointly conducted by two (2) or more Customs inspectors. The inspectors shall, when carrying out the inspection, wear Customs uniforms.

Article 4 The inspection shall be conducted within a Customs control area.

Where the inspection is unfit to be conducted within Customs control areas because the goods can be easily affected by temperature, static electricity, dust or any other natural factor, or the inspection needs to be conducted outside Customs control areas due to any other special factor, Customs may assign officers to carry out inspection outside Customs control areas upon written application of the consignee or consigner of imported and exported goods or the agent thereof.

Article 5 When carrying out the inspection, Customs may conduct either thorough inspection or selective inspection. The inspection may, in light of operational methods, be divided into manual inspection and machine inspection, and the former can be further divided into inspection of the exterior and inspection by package opening.

Customs may, in light of the situation of the goods and the actual requirements for law enforcement, determine the specific inspection methods to be used.

Article 6 Customs shall, before carrying out the inspection of imported and exported goods, ask the consignee or consigner of imported and exported goods or the agent thereof to be present.

Article 7 The consignee or consigner of imported and exported goods or the agent thereof shall, when the inspection of goods is carried out, be on the scene to be responsible for moving goods, removing and re-sealing the package of goods as requested by Customs, and to faithfully answer the inquiries of inspectors and provide necessary materials.

Article 8 In case the imported and exported goods are special or can be easily damaged by improper opening or moving and it is necessary for inspectors to pay special attention during the course of inspection, the consignee or consigner of imported and exported goods or the agent thereof shall bring the case up before Customs carries out the inspection.

Article 9 Where it is necessary to pick up samples or conduct testing during the course of inspection to further determine or distinguish the name, specification or any other nature of imported and exported goods, Customs shall handle it in accordance with the Provisions of the General Administration of Customs of the People's Republic of China on the Testing and Appraisal of Imported and Exported Goods.

Article 10 Upon completion of inspection, the inspectors shall faithfully fill in the inspection records and affix their signatures thereto. The inspection records shall be affirmed by the signature of the consignee or consigner of imported and exported goods or the agent thereof who is present. If the consignee or consigner of imported and exported goods or the agent thereof refuses to affix his/her signature, the inspectors shall indicate such a fact in the inspection records, and affirm it by the signature of the operator of the Customs control premises where the goods are placed. The inspection records shall be kept by Customs as attached documents to the Customs declaration form.

Article 11 In any of the following circumstances, Customs may re-inspect those goods that have been inspected:

(1) The true nature of goods has not been identified upon the first inspection, and it is necessary to further determine some characteristics of the goods that have been inspected;

(2) The goods are suspected of being involved in a case of smuggling, and it is necessary to conduct a new inspection;

(3) The consignee or consigner of imported and exported goods holds objection to the inspection conclusion of Customs and requests re-inspection and the request has been approved by Customs; or

(4) Any other circumstance under which a new inspection is necessary as required by Customs.

The re-inspection shall be conducted according to Articles 6 up to 10 of these Measures, and the inspectors shall indicate the word of “re-inspection” on the inspection records.

Those inspectors who have participated in the first inspection shall not take part in the re-inspection of the same goods.

Article 12 In any of the following circumstances, Customs may directly open the package of goods for inspection even if the consignee or consigner of imported and exported goods or the agent thereof is not on the scene:

(1) The imported and exported goods are suspected as illegal;

(2) The consignee or consigner of imported and exported goods or the agent thereof fails to come to the scene on time after he/she is notified by Customs of the inspection.

When Customs directly opens the package of goods for inspection, the operator of the Customs control premises where the goods are stored and the person responsible for the means of transport of the goods shall offer assistance on the scene, and affirm the inspection by affixing their signatures to the inspection records.

Article 13 As to those goods that are dangerous, fresh and live, decayable, perishable, or likely to lose efficacy or deteriorate and are not suitable for long-time storage or the goods for which urgent inspection and clearance is required due to any other special circumstance, Customs may arrange the inspection with priority upon application of the consignee or consigner of imported and exported goods or the agent thereof.

Article 14 The consignee or consigner of imported and exported goods or the agent thereof who violates these Measures shall be punished by Customs in accordance with the relevant provisions of the Customs Law of the People's Republic of China, the Regulations of the People’s Republic of China on Implementing Customs Administrative Penalty and other relevant provisions.

Article 15 In case Customs causes any damage to the goods being inspected when it carries out the inspection of imported and exported goods, Customs shall assume the liability of compensation according to the Customs Law of the People's Republic of China and the Measures of the General Administration of Customs of the People’s Republic of China for Customs Administrative Compensation.

Article 16 Any inspector who violates the relevant provisions during the course of inspection and makes use of his/her official capacity to seek personal interests for himself/herself or any other person, asks for or accepts bribes, abuses his/her power, intentionally puts up obstacles or delays the inspection shall be punished according to the relevant provisions.

Article 17 Customs shall not charge any inspection fee when it carries out the inspection within the Customs control area. Where Customs affixes Customs seals to containers, container trucks or goods, it may collect the sealing cost for the production of the seals in accordance with relevant provisions.

The fees incurred from moving, opening or resealing of packages of imported and exported goods due to the inspection shall be borne by the consignee or consigner of imported and exported goods.

Where goods are inspected outside the Customs control area, the consignee or consigner of imported and exported goods or the agent thereof shall pay fees to Customs in accordance with the relevant provisions.

Article 18 Terms used in these Measures are defined as follows:

The term “inspection of the exterior” refers to an inspection method to examine the packaging, marks and appearance, etc. of those goods that have visual outside characteristics directly perceivable or whose basic attributes can be easily judged.

The term “inspection by package opening” refers to an inspection method to examine the actual situation of goods after the goods are taken out of containers, container trucks or other boxes and be removed of their outside packages.

The term “machine inspection” refers to an inspection method to examine the actual situation of goods by mainly making use of technical inspection equipment.

The term “selective inspection” refers to an inspection method to selectively examine the actual situation of a certain proportion of goods among the goods of a consignment.

The term “thorough inspection” refers to an inspection method to examine the actual situation of goods by opening packages article by article.

Article 19 The right of interpretation of these Measures shall remain with the General Administration of Customs of the People’s Republic of China.

Article 20 These Measures shall come into force as of February 1, 2006.

(All information in this document is authentic in Chinese. English is provided for reference only. In case of any discrepancy, the Chinese version shall prevail.)