Customs Registration and Recorded Enterprise Credit Management
General Administration of Customs announced a new edition of the Measures on Customs Registration and Recorded Enterprise Credit Management of the People's Republic of China ("Credit Management Measures"), which will come into effect on November 1st, 2021. The following are 10 major highlights selected by Dongjin:
- Optimization of enterprise credit rating classification
The new edition of "Credit Management Measures" optimizes the enterprise credit rating into three categories as "Advanced Certified Enterprise", "Defaulted Enterprise" and "Other Enterprise", and implements convenient or strict measures respectively, while "Other Enterprise" implements conventional customs management measures uniformly, forming a simple and effective credit system arrangement.
- New provision of the Customs to provide credit cultivation services
Customs helps enterprises to strengthen the awareness of integrity and compliance, and improve the level of integrity business operation. This move is intended to enable more enterprises that meet the certification standards to become "Authorized Economic Operator" (AEO).
- Establishment of credit repair mechanism
Defaulted enterprises that are not included in the “List of Seriously Defaulted Subjects” correct the breach of trust, eliminate the adverse impact, and meet the appropriate conditions, may apply to the Customs for credit repair in writing form. If the defaulted enterprise has been placed in the “List of Seriously Defaulted Subjects”, it should be moved out of the List.
- Enrichment of preferential measures for advanced certified enterprises
Add three preferential measures such as "priority for customs clearance of import and export goods", "priority for the registration of agricultural products and foods export enterprises recommended to other countries (regions)", and "the average percentage of random checks of the origin of export goods survey in the average percentage of enterprises less than 20%".
- Extension of the review period for advanced certified enterprises
The review period is adjusted from 3 years to 5 years. Also, in the case of abnormal enterprise credit status, the Customs could conduct a review on an irregular schedule.
- Specified circumstances for the suspension of the application of advanced certified enterprise management measures
The circumstances include: Advanced certified enterprise suspected of violating the laws and regulations related to Customs management functions is criminally filed; Advanced certified enterprise suspected of violating the supervision of Customs is filed for investigation; Advanced certified enterprise with financial risk, or there are obvious signs of transferring or hiding its taxable goods and other property, or there are other risks of not being able to fully guarantee the tax payment.
- Optimization of the identification standards for defaulted enterprises
Optimize the original standards and further improve the circumstances of the default, so that the identification of defaulted enterprises would be more accurate.
- Establishment of the “List of Serious Defaulted Subjects”
The disciplinary provisions for serious default involving the life and health of the people have been added, and joint disciplinary measures will be implemented for defaulted enterprises, which will be included in the “List of Seriously Defaulted Subjects”.
- Clarification of the remedies for enterprises
Before making a decision to identify the defaulted enterprises, Customs need to perform the obligation of notification, that is, to inform the enterprise the grounds for the decision in writing and the right to make statements and representations in accordance with the law; If the enterprise is to be included in the “List of Serious Defaulted Subjects”, the enterprise should also be informed of the inclusion of disciplinary measures prompted, removal conditions and procedures and remedies.
- Relevant contents of the professional conclusions from social intermediaries
The professional conclusions about the identification and review on advanced certified enterprises issued by the social intermediaries entrusted by the enterprises can be deemed as a reference basis by the Customs.
If you want to read the complete article, you can refer to the below link (in Chinese only): http://www.shanghaiinvest.com/cn/viewfile.php?id=16713
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Mr. Mike Chang (Partner)