In accordance with Regulation of the People’s Republic of China on the Administration of the Import and Export of Goods as well as Interim Measures for the Administration of Import Tariff Quotas of Chemical Fertilizer, Total Import Amount, Distribution Principle and Relevant Procedures of Tariff Quotas of Chemical Fertilizer in 2013 has been formulated and it is hereby to be announced for earnest compliance and implementation.

Contact person: Li Qian Department of Foreign Trade
Address: Department of Foreign Trade, the Ministry of Commerce, No.2 Dong Chang’an Avenue, Beijing, China
Post code: 100731
Tel: 010-65197740
Fax: 010-65197447
Email: [email protected]

Appendix: Total Import Amount, Distribution Principle and Relevant Procedures of Tariff Quotas of Chemical Fertilizer in 2013

Ministry of Commerce of the People’s Republic of China
October 10, 2012

Appendix:

Total Import Amount, Distribution Principle and Relevant Procedures of Tariff Quotas of Chemical Fertilizer in 2013

Article 1: Total import amount of tariff quotas

Total import amount of tariff quotas of chemical fertilizer in 2013 is 13.65 million tons, including 3.3 million tons of carbamide, 6.9 million tons of diammonium phosphate and 3.45 million tons of compound fertilizer.

Article 2: Distribution principle

A principle of “first apply, first obtain” is adopted for the distribution of tariff quotas for the import of chemical fertilizer. Enterprises that have registered in the administration authority for industry and commerce shall apply for the tariff quotas for the import of chemical fertilizer subject to their scopes of business.

Article 3 Tariff quotas for state and non-state trading

Volumes of tariff quotas for the import of chemical fertilizer of state trading in 2013 are: 2.97 million tons of carbamide, 3.52 million tons of diammonium phosphate and 1.76 million tons of compound fertilizer respectively. The amount applied by state trading enterprises such as Sinochem Group and China National Agricultural Means of Production Group Corporation is subject to the total amount of tariff quotas of state trade.

Volumes of tariff quotas for the import of chemical fertilizer of non-state trading in 2013 are: 0.33 million tons of carbamide, 3.38 million tons of diammonium phosphate and 1.69 million tons of compound fertilizer. The amount applied by non-state trading enterprises such as China National Chemical Construction Corp. and Huaken International Trade Co., Ltd. is subject to the total amount of tariff quotas of non-state trading.

Other enterprises shall choose to apply for the tariff quotas of state or non-state trading according to their practical demands of import.

Article 4 First apply, first obtain

The principle of “first apply, first obtain” is adopted in the application of enterprises for the tariff quotas for import of chemical fertilizer until the total amount is exhausted. When enterprises apply for tariff quotas of chemical fertilizer, the applicable starting amount of tariff quotas they apply for shall be decided according to the quotas obtained in the past. The enterprises can apply for and obtain the Certificate of Tariff Quotas for Import of Chemical Fertilizer for several times within the amount subject to the starting amount of tariff quotas. Enterprises, after customs declaration or returning unused tariff quotas, may repeatedly apply for tariff quotas subject to the limit of starting amount of tariff quotas.

Article 5 Starting amount of tariff quotas

The starting amount of tariff quotas in 2013 is, based on the starting amount in 2012, subject to change as follows:

(1) The amount for enterprises, of which the foreign exchange verification and cancellation rate was over 80% in 2012 shall be raised by 40%;
(2) The amount for enterprises, of which the foreign exchange verification and cancellation rate was between 50% and 79% in 2012 shall be raised by 20%;
(3)The amount for enterprises, of which the foreign exchange verification and cancellation rate was between 25% and 49% shall remain unchanged;
(4) The amount for enterprises, of which the foreign exchange verification and cancellation rate was below 25% shall be reduced by 50%;
(5) For new enterprises applying for the quota, the starting amount of tariff quotas shall be 2,000 tons.

Article 6 Application materials

Enterprises shall apply for and obtain tariff quotas for import of chemical fertilizer in the authorities for the management of tariff quota for import of chemical fertilizer (hereinafter referred to as Tariff Quota Administration Authorities) commissioned by the Ministry of Commerce. When applying, the enterprises shall provide the original or duplicate of the following materials and the copies thereof:

(1) Form of Application for Tariff Quotas for Import of Chemical Fertilizer and a letter of commitment claiming the authenticity of the provided materials;
(2) Contract or entrusted contract of import with legal force;
(3) Bank letter of credit or other voucher for the payment of exchanges;
(4) Bill of lading or other effective evidence proving the title of the cargos;
(5) Other materials to be provided as required by Tariff Quota Administration Authorities;
(6) Enterprises applying for the quota for the first time in the year shall, besides the materials above, provide the business license that passed the annual verification, and the organizational code of enterprises, and Sino-foreign joint equity, cooperative ventures, and foreign-owned enterprises are required to otherwise provide certificate of approval.

Article 7 Application, acceptance and issuance of the Certificate of Tariff Quotas for Import of Chemical Fertilizer

Each Tariff Quota Administration Authority shall be responsible for accepting the application for tariff quotas for import of chemical fertilizer by local enterprises, signing and issuing the Certificate of Tariff Quotas for Import of Chemical Fertilizer within 5 working days after the application materials are fully provided for the qualified enterprises, and keeping the copies of the application materials of enterprises at the same time.
Each Tariff Quota Administration Authority shall submit the copies of business license and the organizational code of the enterprises, and the certificate of approval in case of Sino-foreign joint equity and cooperative ventures, and foreign-owned enterprises, which newly apply for tariff quotas of chemical fertilizer, to the (Department of Foreign Trade of) the Ministry of Commerce and forward them to the Quota & Licence Administrative Bureau Ministry of Commerce of the People’s Republic of China.

Article 8 Validity period, alteration and loss of the Certificate of Tariff Quotas for Import of Chemical Fertilizer

The validity period of the Certificate of Tariff Quotas for Import of Chemical Fertilizer is 3 months and shall not be later than December 31, 2013. Those requiring an extension or alteration shall newly go through the formalities, replacing a new certificate in substitution for the former with indication of former certificate number in the remark column. If the certificate of Tariff Quotas for Import of Chemical Fertilizer is lost, enterprises shall report the loss to the original Tariff Quota Administration Authority and the port of entry listed in the certificate within 10 working days. After the verifying the report to be correct, the original Tariff Quota Administration Authority shall issue a new certificate and indicate the former certificate number in the remark column thereof.
Article 9 Verification and cancellation of the used Certificate of Tariff Quotas for Import of Chemical Fertilizer

Within 10 working days after customs declaration, enterprises shall pre-verify and pre-cancel the used Certificate of Tariff Quotas for Import of Chemical Fertilizer with a written letter of verification and cancelation affixed with the official seal of enterprises. The letter shall list the certificate number, the number of the bill of entry, quantity, date, and port of entry etc. The amount of pre-verified and pre-cancelled shall not be calculated in the starting amount applicable to enterprises. Enterprises may repeatedly apply for the Certificate of Tariff Quotas for Import of Chemical Fertilizer according to the pre-verified and pre-cancelled amount. After the formalities for payment of foreign exchange and customs clearance are completed, enterprises shall formally verify and cancel the used Certificate of Tariff Quotas for Import of Chemical Fertilizer in the Tariff Quota Administration Authorities with the original bill of entry affixed with the seal of check-off of the customs. The formalities for the formal verification and cancellation shall be completed within 3 months after the customs clearance.
For any enterprise requiring a delay payment of foreign exchange, the enterprise shall, after issuing a letter indicating the matters and making a commitment that go through a formal verification and cancellation procedure in the Tariff Quota Administration Authorities with the original notice of import acceptance/ exchange payment issued by the bank after the payment of exchange.

Article 10 Return of unused Certificate of Tariff Quotas for Import of Chemical Fertilizer

Enterprises shall return fully or partly unused Certificate of Tariff Quotas for Import of Chemical Fertilizer to the Tariff Quota Administration Authorities within 15 working days after the validity date is expired. The returned amount of tariff quotas for enterprises shall be credited in the national unused total amount of tariff quotas for import of chemical fertilizer.

Article 11 Supervision and administration of the verification and cancellation of Certificate of Tariff Quotas for Import of Chemical Fertilizer
The Quota & Licence Administrative Bureau Ministry of Commerce of the People’s Republic of China is in charge of the supervision and administration of the verification and cancellation of the Certificate of Tariff Quotas for Import of Chemical Fertilizer all over the country, monitoring and releasing the verification and cancellation rate (i.e. the verified and cancelled amount (including the pre-verified and pre-cancelled amount)/the total amount applied by enterprises) of enterprises on a quarterly basis.
The Quota & Licence Administrative Bureau supervises and urges the Tariff Quota Administration Authorities to remind enterprises with the verification and cancellation rate less than 25% by the end of the first quarter to return unused quotas, to give cautions and warnings to enterprises with the verification and cancellation rate less than 25% by the second quarter and, for enterprises with accumulative rate less than 25% by the end of the third quarter, to reduce their amount of quotas by 50% of the starting amount thereof or suspend issuance of new Certificate of Tariff Quotas for Import of Chemical Fertilizer to them.

The annual verification and cancellation rate of enterprises shall be a basis for their starting amount of tariff quotas in 2014.

Article 12 Release of unused amount of tariff quotas for import of chemical fertilizer
In the event that the remainder amount of tariff quotas for import of chemical fertilizer is less than 20% of the total amount, the Quota & Licence Administrative Bureau Ministry of Commerce of the People’s Republic of China will publish the remainder amount of national tariff quotas for import of chemical fertilizer every half a month.

Article 13 Relevant responsibilities of enterprises

Enterprises applying for quotas shall be responsible for the authenticity of the materials provided and shall issue a letter of commitment affixed with the official seal thereof. The enterprises, if verified to forge or alter the materials, shall be investigated for legal responsibility according to law.

Those who forge, alter or trade the Certificate of Tariff Quotas for the Import of Chemical Fertilizer shall be investigated for criminal responsibilities in light of the provisions of Criminal Law of the People’s Republic of China with respect to the illegal business operations or forging, altering, buying or selling official documents, certificates, testimonial papers or seals of a government department.

The Tariff Quota Administration Authorities shall not, within three years, accept the application for the Certificate of Tariff Quotas for Import of Chemical Fertilizer from enterprises verified to have conducted the forgoing actions.

Article 14 Miscellaneous
The Tariff Quota Administration Authorities shall accept the application for, and issue the 2013 Certificate of Tariff Quotas for the Import of Chemical Fertilizer since December 15, 2012. The operation of import of chemical fertilizer shall remain subject to the sate and non-state trading administration.

Article 15 The Announcement shall be construed by the Ministry of Commerce.

Attachment: 1. List of Taxable Items and Tax Rates for Tariff Quotas Administration of Import of Chemical Fertilizer

2. List of Tariff Quota Administration Authorities Commissioned by the Ministry of Commerce