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Laws and Regulations

Foreign Trade List
Regulations of the People's Republic of China on Management of International Freight Forwarders
    (Promulgated by Decree No.5 of the Ministry of Foreign Trade and Economic Cooperation on June 29, 1995)
Chapter I General Provisions

Article 1 These regulations are formulated to govern behaviors of international freight forwarders to safeguard the lawful rights and benefits of consignors and consignees of exports and imports, and international freight forwarders and to promote the development of foreign trade.

Article 2 The international freight forwarders referred to in the regulations mean those trades entrusted by consignors and consignees of exports and imports conducting international freight forward and related businesses for their clients and collect enumerations for their services in their own names or in the name of their consignors.

Article 3 International freight forwarders must obtain the status of a legal body as an enterprise of the People's Republic of China according to law.

Article 4 The competent departments of foreign trade and economic cooperation under the State Council are responsible for supervision and management of international freight forwarders throughout the country.

The competent departments of foreign trade and economic relations of people's governments of various provinces, autonomous regions and municipalities directly under the Central Government as well as special economic zones (hereinafter referred to as local competent departments of foreign trade, are responsible for supervision and management of international freight forwarders in their administrative areas in accordance with the regulations and within the scope of power authorized by the competent departments of foreign trade and economic cooperation under the State Council.

Article 5 The supervision and management of international freight forwarders should abide by the following principles:

1. To meet the demands of development of foreign trade and promote the rational distribution of international freight forwarding agencies.

2. To protect fair competition and promote the improvement of services of international freight forwarders.

Article 6 Enterprises engaged in international freight forwarding should observe the laws and administrative rules and regulations of the People's Republic of China and be subject to the supervision and management carried out by related competent institutions of their trade in keeping with relevant laws and administrative rules and regulations.

Chapter II Conditions for the Establishment

Article 7 According to the characteristics of the trade the establishment of an international freight forwarder must acquire the following conditions:

1. Having competent professionals to engage in international freight forwarding;

2. Having a fixed site for business and necessary facilities;

3. Having stable sources of and markets for exports and imports.

Article 8 The minimum amount of registered capital of an international freight forwarder must meet the following demands:

1. The minimum amount of registered capital of an international freight forwarder by sea should be RMB 5 million yuan.

2. The minimum amount of registered capital of an international freight forwarder by air should be RMB 3 million yuan.

3. The minimum amount of registered capital of an international freight forwarder by land or international express deliverer should be RMB 2 million yuan.

For an enterprise engaged in two or more than two items of businesses mentioned above, its minimum amount of registered capital should be that of the item with the highest amount of registered capital.

In setting up a branch an international freight forwarder should add a registered capital of RMB 500, 000 yuan.

Chapter III Procedures of Examination and Approval

Article 9 To apply for the establishment of an international freight forwarding agency the applicant should submit an application to the local competent department of foreign trade where the agency is to be set up and, with opinions put forward by the department, should forward the application to the competent department of foreign trade and economic cooperation under the State Council for approval and ratification.

Enterprises directly under the departments of the State Council in Beijing which apply to establish international freight forwarding agencies in Beijing may file applications to the competent department of foreign trade and economic cooperation under the State Council, and the latter is responsible for examination and approval.

Article 10 To apply for the establishment of an international freight forwarding agency, the following documents should be submitted:

1. Application.

2. Draft Constitution of the enterprise.

3. The names, posts and identification paper of leading members and chief staff members.

4. Certificates of credit standing and conditions of operational facilities.

5. Other documents as stipulated by the competent departments of foreign trade and economic cooperation under the State Council.

Article 11 The local competent department of foreign trade should put forward its opinions within 45 days from the day it receives the application and other documents and then forwards them to the competent department of foreign trade and economic cooperation under the State Council.

The competent department of foreign trade and economic cooperation under the State Council should decide on approval or disapproval within 45 days from the day it receives the application for the establishment of an international freight forwarding agency and other documents, and should issue a certificate of ratification to the approved international freight forwarding agency.

Article 12 With the certificate of ratification issued by the competent department of trade and economic cooperation under the State Council the international freight forwarding agency should go through the procedures of enterprise and taxation registration according to relevant stipulations of laws, administrative rules and regulations.

Article 13 The competent department of foreign trade and economic cooperation under the State Council should cancel the certificate of ratification if the applicant does not open business without proper reasons within 180 days from the day it receives the certificate of ratification.

Article 14 The certificate of ratification is valid for 3 years.

When the certificate of ratification expire and the agency wants to continue its business, the international freight forwarding agency should apply to the competent department of foreign trade and economic cooperation under the State Council for another certificate of ratification 30 days before the expiration date.

If the international freight forwarding agency does not apply for another certificate of ratification according to stipulations in the previous clause, it will automatically lose its qualification to engage in international freight forwarder.

Article 15 When the international freight forwarding agency terminates its business it should report to the local competent department of foreign trade or to the competent department of foreign trade and economic cooperation under the State Council according to the procedures of application for its establishment as stipulated in Article 9 and hand in its ratification certificate for cancellation.

Article 16 To apply for setting up a branch the international freight forwarding agency should go through the necessary procedures stipulated in these regulations.

Chapter IV Business Scope

Article 17 An international freight forwarding agency may accept a commission to operate part or all of the following business:

1. To book ship's holds and warehouses;

2. Supervision of freight loading and unloading and assembling and dismantling of containers;

3. Multi-forms of international through transportation;

4. International express delivery excluding private letters;

5. To make customs declaration, undergo customs quarantine and inspection and to insure;

6. To prepare related bills and certificates, pay transport charges, settle accounts and pay miscellaneous fees.

7. Other businesses of international forwarding.

An international freight forwarding agency should conduct its business within the ratified scope. To engage in above-mentioned businesses an international freight forwarding agency should register with relevant competent departments as required by related laws and administrative rules and regulations.

International freight forwarding agencies can be mutually entrusted to conduct businesses stipulated in this article.

Article 18 International freight forwarding agencies should pursue an operational policy of safety, high speed, accuracy, economy and convenience in serving consignors and consignees of exports and imports.

Article 19 An international freight forwarding agency must set the standards of charges to be collected according to relevant state stipulations and publicize them at the business site.

Article 20 An international freight forwarding agency must use invoices checked and approved by taxation departments in its business.

Article 21 An international freight forwarding agency should hand in a report on its business performance of the previous year to the local competent department of foreign trade of its locality before the end of March every year.

Article 22 An international freight forwarding agency is not allowed to do the following things:

1. To conduct business by means of unfair competition;

2. To lend, lease or transfer to others its certificate of ratification and other papers concerning international freight forwarding business.

Chapter V Penalties

Article 23 When an international freight forwarding agency violates the stipulations of Articles 19 and 21 of these regulations, the competent department of foreign trade and economic operation under the State Council should serve it a warning and order it to amend within a time limit. If not, the department should cancel its certificate of ratification.

Article 24 When an international freight forwarding agency violates the 2nd stipulation of Article 17 and stipulations of Articles 20 and 22, the competent department of foreign trade and economic cooperation under the State Council should serve it a warning and order it to suspended business for rectification up to cancelling its certificate of ratification. Related competent departments of industrial and commercial administration, customs and taxation should give punishments according to relevant laws and administrative rules and regulations.

Article 25 To engage in international freight forwarding business without authorization as prescribed in Article 17, in violation of the stipulations of these regulations, the competent departments of foreign trade and economic cooperation under the State Council should ban these illegal business activities and the administration institutions of industry and commerce should give punishments according to laws, administrative rules and regulations.

Article 26 If violations of the regulations constitute a crime, the violator should be given criminal sanctions according to law.

Chapter VI Supplementary Provisions

Article 27 International freight forwarders may set up an association of international freight forwarders which can give guidance and provide services to its members according to its charter.

Article 28 The regulations shall go into effect from the date of promulgation.

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