Customer Guideline

Import Regulations of Hong Kong's Major Trading Partners

China Import Requirements

As a move to liberalise trade, China has continued to reduce administrative barriers to trade. By end-1997, the categories of import commodities subject to licensing controls were reduced to 35 (including 374 items), and most commodities, except 16 crucial ones which are currently under state monopoly, were open to all enterprises given the import & export rights.

The Chinese government has also gradually abolished the state monopoly of foreign trade and liberalise its foreign trading system. By end-June 1999, China had more than 185,000 foreign trade enterprises, including 13,224 foreign trade and economic cooperation companies, 12,143 local manufacturing enterprises and scientific research institutes, and 160,000 foreign-invested enterprises having import & export rights. In January-February 1999, 61 private-owned enterprises were given the import & export rights.

According to the Chinese government, the average tariff on imports of industrial products will be lowered to 15% by year 2000 and 10% by year 2005. At present, the average tariff rate is less than 17%.

In April 1997, China announced its first anti-dumping and anti-subsidy regulations enacted to maintain order and fair competition in foreign trade and protect relevant domestic industries. Under the new regulations, China can impose anti-dumping duties on foreign goods if there is evidence showing that they are sold at dumping prices.

China uses both tariff and non-tariff measures to regulate imports. Tariffs imposed include import duty (applied on the import CIF value and a few specific and compound duties on the volume imported), value added tax (VAT) and consumption tax; non-tariff measures include import licenses, quota control, restricted import list, etc. In general, tariff rates on raw materials and industrial supplies are relatively low, less than 20% (in most cases), higher on consumer goods mostly 20-50% and can reach 100% in a few selected luxury items. The specific duties are calculated by multiplying the number of units of the imported goods by tax payable per unit; while the compound duties are a mixture of ad valorem tariff and specific duty.

Both Hong Kong and countries which have concluded trade treaties or reciprocal favourable tariff treatment agreements with China can enjoy the preferential rate tariff duty; while other the general rate.

Value added tax (VAT) is imposed on all commodities in addition to import tariffs. The basic rate is 17% and 13% on the following commodities: food and edible vegetable oil; drinking water, heating, natural gas, coal gas, liquefied petroleum gas; books, newspapers and magazines; feedstuffs, chemical fertilizer, pesticides, agricultural machinery and agricultural plastic sheeting.

In addition, 11 categories of goods are also subject to consumption tax when entering China. These include: cigarettes, liquor, cosmetics, skin- and hair-care products, jewellery, firecrackers and fireworks, petroleum, diesel, motor vehicle tyres, motorcycles and small motor vehicles. The tax rates range between 3% and 45%.

Current policies regarding imports of equipment by foreign-invested enterprises are:

  • For enterprises approved on or before 31 Mar 96, the original preferential policy applies until contract expires. However, imports of 20 specified categories such as vehicles and office supplies are subject to their relevant tariffs and regulations.
  • For enterprises approved between 1 Apr 96-31 Dec 97, as "encouraged" or "restricted (II)" in the "Catalogue of Industries for Guiding Foreign Investment", production equipment imported are exempted from import duties, except those listed in "Catalogue of Non-Duty-Free Commodities to be Imported for Foreign-Funded Projects".
  • As of 1 January 1998, equipment imported by foreign-invested enterprises which are engaged in projects classified as "encouraged" or "restricted (II)" in the "Catalogue of Industries Guiding Foreign Investment" as contribution to their investment are exempted from import duties upon presentation of a letter of project confirmation except for those listed in the "Catalogue of Non-Duty-Free Commodities to be Imported for Foreign-Funded Projects".

Customs tariff, VAT and consumption tax may be imposed on the following 20 commodities if applicable, regardless of the form of trade, geographical location or entry of imports, namely: television set, video camera, video cassette recorder, video cassette player, hi-fi system, air-conditioner, refrigerator, washing machine, camera, copying machine, programme-controlled telephone switch, micro-computer, telephone, radio pager, fax machine, electronic calculator, typewriter and word-processor, furniture, lighting fixture and foodstuffs.

Normally, documentation requirements are handled by the Chinese importer (agent, distributor or joint venture partner). Necessary documents include the bill of lading, invoice, shipping list, sales contract, an import quota certificate for general commodities (where applicable), import license (where applicable), inspection certificate issued by the State Administration for Import and Export Commodity Inspection (SACI) or its local bureau (where applicable), insurance policy, and customs declaration form.

As for non-tariff measures, China has introduced the licensing system and the quota system to control imports: at present, imports of 35 product categories (374 items) are subject to import licensing control. Importers are required to obtain in prior the approval and licence from the different government departments, namely the State Development Planning Commission, the Ministry of Commerce (MOFCOM)--formerly the MOFTEC--and the Mechanic and Electronic Products Import and Export Department. In addition, certain imports into China are subject to both licensing and quota control. Imports into China are classified into two major categories: 1. 15 machinery and electronic products; and 2. 13 general commodities. The quota management system is enforced by the State Development Planning Commission responsible for import quotas of general commodities and MOFCOM responsible for import quotas of machinery and electronic products as well as export quotas.

In principle, all import and export commodities are subject to inspection. Twenty categories of import commodities are subject to mandatory inspection by the China Commodity Inspection Bureau (CCIB) and 47 categories subject to safety control. Applicable standards for inspection should normally be specified in the contract of sale, including standards for quality, weight, quantity, packing and inspection methods. Such standards must not be lower than the corresponding Chinese national standards. For those products without the CCIB safety marking, they are forbidden importing into the country.

Imports of wastes for dumping, stacking and disposal within its territories are prohibited. Imports of wastes that can be used as raw materials are also restricted.

On 15 November 1999, China and the US signed a bilateral agreement on China's accession to World Trade Organisation, paring its way for China to join this multinational trade body. Substantial market access commitments cover the agricultural, industrial and service sectors.

Useful contacts for information relating to doing imports/exports in China:-

  • China Ministry of Commerce (MOFCOM)
    Dongchang'an Jie, Beijing Postal code: 100731 (Tel: 10 6519 8114)
    Website : http://www.mofcom.gov.cn/
  • General Administration of Customs of the PRC, 6 Jianguomennei Dajie, Beijing Postal code: 100730 (Tel: 10 6519 4114 & Fax: 10 6519 4004)
    Website: http://www.customs.gov.cn/
  • State Import and Export Commodities Inspection Bureau, A10 Chaowai Dajie, Beijing Postal code: 100020 (Tel: 10 6599 4600 & Fax: 10 6599 3846)
  • State Industry & Commerce Administrative Bureau, 38 Sanlihe Donglu, Beijing Postal code: 100820 (Tel: 10 6803 2233) Website: http://www.saic.gov.cn/ China Council for the Promotion of International Trade (CCPIT), 1 Fuxingmenwai Dajie, Beijing (Tel: 10 6512 1034) Website: http://www.ccpit.org.cn/
  • State Intellectual Property Office of PRC, 6 Xituchenglu Haidian, Beijing Postal code: 100088 Website: http://www.cpo.cn.net/.

1 Textiles & Clothing

2 Toys

3 Electrical Appliances

4 Food

5 Pharmaceutical Product