Import restrictions & licensing procedures in China

Under China's 2001 WTO accession agreement, China made substantial market access commitments covering the agricultural, industrial and services sectors, phasing out of non-tariff barriers on imports, i.e. import license requirements have been eliminated and all quotas phased out within five years of accession.

specific import licensing procedures as follows,

1. Import licensing in China can be divided into three categories:
(a) import license administration
(b) automatic import licensing
(c) import tariff rate quota administration

2.No product is subject to import quota license administration any more.
On 7 December 2005, MOFCOM published MOFCOM Announcement No. 93 of 2005, which abolished the import tariff rate quota administration on vegetable oil. At present, products under import tariff rate quota administration include grain, cotton, sugar, wool, wool tops and chemical fertilizer, the TRQ of which is applied globally.

I. NDRC promulgated on 30 September 2005 the Quantities, Application Conditions and Allocation Methods of Tariff Rate Quota for Importation of Grain and Cotton of 2006 in its Announcement No. 58 of 2005. MOFCOM promulgated on 26 September 2005 the Application and Allocation Methods of Tariff Rate Quota for Importation of Sugar of 2006 in its Announcement No.64 of 2005, and Implementing Rules on the Administration of Tariff Rate Quota for Importation of Wool and Wool Tops of 2006 in its Announcement No. 65 of 2005. MOFCOM also promulgated on 29 September 2005 the Quantities, Allocation Principles and Application Procedures of Tariff Rate Quota for Importation of Fertilizers of 2006 in its Announcement No. 67 of 2005.

II. The tariff rate quota for the next year is issued to end users before 1 January of the year, and the tariff rate quota is valid throughout the whole calendar year.
For the TRQ holder for grain, cotton and sugar, a TRQ warrant, which should be provided to the Customs during Customs clearance, is valid throughout the whole calendar year. The TRQ holder is entitled to demand an extension for the warrant from the competent authority if the original warrant expired in case of uncompleted importation or the business contract not performed, but the validity period of the warrant should not exceed the end of February of the next calendar year.

For the TRQ holder for wool and wool top, the TRQ warrant is valid for six months within the calendar year. However, the TRQ holder is entitled to demand an extension for warrant from the competent authority if the original warrant expired in case of uncompleted importation or business contract not performed. The validity period of warrant should not exceed the end of February of the next calendar year.
For the TRQ holder for chemical fertilizer, the TRQ warrant is valid for six months. However, the TRQ holder is entitled to demand an extension for the warrant from the competent authority if the original warrant expired in case of uncompleted importation. The extension should not exceed the validity period of the Tariff Rate Quota.

III. For products under import tariff rate quota administration, the TRQ holders should annually return, for reallocation, the unfilled tariff rate quota of the calendar year within the scheduled time limit. To ensure that the allocated tariff rate quota is used for importation, for TRQ holders who do not fully use the tariff rate quota for the year and do not return the unfilled tariff rate quota within the scheduled time limit, their next year quantity of tariff rate quota will be reduced accordingly.

IV. For products under import tariff rate quota administration, the period for submission of application is 15 days. (Excluding those to which first come, first served is applicable.)

V. For products under import tariff rate quota administration, the time for processing the application is two months after the closing date of the period for the submission of application.

VI. For products under import tariff rate quota administration, at least one day remains between the granting of the tariff rate quota and the date of the opening of the period of importation.

VII. For products under import tariff rate quota administration, according to the variety of products, the applicant should submit the application to entities with authorization of either MOFCOM (sugar, wool, wool top and chemical fertilizer) or NDRC (grain and cotton) to have the application verified. The entities will then transmit the application to either MOFCOM or NDRC. MOFCOM or NDRC will, through the authorized entities, allocate to applicants import tariff rate quota. Import TRQ holders do not have to acquire an import license.

VIII. The allocation of import tariff rate quota for agricultural products is based on the number of applicants, historical import performance, production capacity and other relevant commercial standards,or on the principle of “first come, first served”(wool and wool top). The reallocation is based on the principle of “first come, first served”, according to published application conditions.
The allocation of import tariff rate quota for chemical fertilizers is based on the number of applicants, historical import performance, capacity of production and operation, quota utilization record and other factors such as the number of new applicants.

IX. For products under import TRQ administration, no matter whether the exporting country issues export permits or not, import licensing procedures are required and the import licensing is not automatic.

X. Not applicable.The issue of licenses is not on condition that goods should be exported and not sold in the domestic market

3. There are no quantitative restrictions for products under automatic import licensing and import license administration.

(a) For products under automatic import licensing, so long as the content and format of the application are correct, the issuing entity should, to the extent practicable, grant the license immediately, or under special circumstances, no more than 10 working days.
For products subject to import license administration, e.g. narcotic drugs etc, the time for granting permit is based on the period necessary for making a reasonable judgement on the justification of the import, but in any case no more than 10 working days.

(b) For products under automatic import licensing administration, the license can be granted immediately upon request.

(c) An Automatic import license is valid within the calendar year, but no more than six months. However, if the holder needs to have the license validity period extended in case of an uncompleted importation or a business contract not performed, he has to apply to the former license issuing body again.
Import license is valid throughout the whole calendar year, and no other limitation is attached.

(d) The consideration of license application is effected by one single administrative organ.
For products under automatic import licensing, the applicant only has to submit the application to the entities authorized by MOFCOM.
For products under import license administration, according to the variety of goods, the applicant should apply to different government entities competent for import permits. With the import permit granted, the applicant then obtains import license from entities authorized by MOFCOM. After obtaining the import permit, import license will be granted automatically. The time for granting an import license is no more than three working days, and under special circumstances it is no more than 10 working days.

4. For products under automatic import licensing, once the State decides to implement temporary measures to prohibit the importation of certain goods or to restrict the quantity of importation of certain goods, the granting of automatic import licenses will be ceased automatically on the day of entry into force of these temporary measures. The temporary measures will be published thirty days before their entry into force.
For products under import license administration, if the justification for importation is believed to be unconvincing, the application may be refused. The applicant will be given the reason for the refusal, and will also be informed of having the right to, pursuant to laws and regulations, apply toadministrative reconsideration or initiate administrative lawsuit.