Descripción del procedimiento de entrenamiento

The word Customs is defined, in the Collins dictionary, as the official organization responsible for collecting taxes on goods coming into a country and preventing illegal goods from being brought in. However, the meaning of customs takes a new twist for most shippers and freight forwarders in China as equivalent to a [hurdle] in cargo shipment.

Under the Communist regulations in China over past fifty years, the Customs Office not only needs to prevent illegal goods from being imported into the country but it also needs to check those so-called “Western materials that will pollute the minds of people in China”. The same practice is still applicable today even after China started the Open-door policy twenty years ago and has become an official member of the WTO in 2001.

Working under such a mentality, the Customs office in China literally checks everything that is imported into China. In order to encourage the Customs officers to work harder, the monetary value of infringing goods seized is linked to their pay. This method ensures Customs officers will not tolerate anyone who tries to escape from paying tax.

ƒ The structure of the Chinese Customs Office

On their official website (CS 2007), China Customs is described as a government agency that supervises and manages all arrivals in and departures from the Customs territory of the People's Republic of China. China Customs uses a vertical and three-tiered management structure. The top tier is the General Administration of Customs (i.e. the headquarters in Beijing). The middle tier is composed of the Guangdong Sub-Administration of Customs (in charge of 7 Customs regions located in Guangdong Province), two (2) Supervising Offices (located in Tianjin and Shanghai respectively), 41 Customs regions and two (2) Customs educational institutions. The third tier refers to the 562 Customs houses or offices under those 41 Customs regions. In addition, it has overseas offices or officials in Brussels, Moscow, Washington D.C. and Hong Kong. Its staff numbers over 48,000.

Currently China Customs operates at 253 first-class ports (including airports, sea ports and land passes) approved by the central government and around 200 second-class ports approved by provincial governments.

The General Administration of Customs is a full-ministerial-level government agency that reports directly to the State Council of the People's Republic of China and manages all the Customs regions nationwide.

According to the Customs Law ( CCustoms 2006) of the People's Republic of China and other relevant laws and regulations, China Customs is in charge of undertaking four essential duties:

• To control inward and outward means of transportation, goods and articles;

• To collect Customs duties, taxes and related charges;

• To combat smuggling;

• To compile Customs statistics and handle other Customs matters.

The working guidelines practised by China Customs are to "exercise law-based administration, safeguard the national gateway, serve the national economic interests and promote social development". Its team-building principle is to make Customs personnel

"politically staunch, professional and reliable".

ƒ China's Customs and Quarantine System

The Chinese government uses a variety of measures to regulate different types of trade, which are classified as general trade (一般貿易), processing and assembling with customers'

materials (來料加工), processing and assembling with imported materials (進料加工),

processing equipment (加 工 設 備 ), foreign-funded equipment ( 外 資 投 資 ), bonded

warehouses (保稅倉庫), and so forth. General trade and processing trade accounts for most

of Guangdong Province's trade. In 2004, these two types of trade accounted for 23% and 69%

of Guangdong Province's total trade, respectively.

Depending on the economic situation and attitude of the Central Government towards trade policy, additional methods to encourage/discourage the import or export goods are implemented from time to time. Most of the shippers are confused by these changing regulations; hence they will employ an in-house qualified Customs broker to deal with the formality for their shipments. Shippers with small volume consignments, will send the documents to the Customs broker company for processing.

There are seven Customs areas in Guangdong, including Shenzhen, Huangpu, Guangzhou, Gongbei, Jiangmen, Shantau, and Zhanjiang ( CCustoms 2006). In 2004, goods cleared at Shenzhen Customs accounted for 48% of all Guangdong Province's exports and imports,

while goods cleared at Huangpu and Guangzhou Customs accounted for 24% and 13%, respectively. The remaining 15% were cleared at Gongbei, Jiangmen, Shantau, and Zhanjiang Customs.

The difference between total trade in Guangdong Province and total trade by Guangdong's Customs districts should more or less reflect the total trade of other provinces that make use of the various ports in the Guangdong Province for imports and exports. The proportion of the volume of goods from other provinces that make use of various ports in the Guangdong Province for imports and exports dropped from 13% in 1995 to 6.4% in 2004. The value of goods rose only from US$15 billion in 1995 to US$24 billion in 2004. Over the past 10 years, the average annual growth rate of total imports and exports of Hong Kong, Macau, the Guangdong Province, and the other eight provinces in the Pan-Pearl River Delta has sunk lower than that of the country as a whole. This indicates that the nature of goods that are imported/exported to Guangdong tend to be higher in cargo value than volume.

Different trade modes and different Customs areas have different clearing practices in handling the shipments. For example, if the consignment is shipped by air then cargo must arrive at the Customs office at the airport twenty four hours before loading. For cross-border consignment by truck, there is no time restriction at all.

The above paragraphs have described the structure of Customs office in China generally.

However, it is more complicated in operation as each Customs district does not communicate well with the others. This shortfall may be a side effect that the Central government want to prevent collusive corruption among Customs districts. It is difficult to describe fully the underlying circumstances in China’s Customs but if we treat each Customs district as a separate country then it will be easier for the traders to visualise how difficult it will be.

ƒ Cross-border trucking under the Customs regulations

In last section, it was mentioned that there is no specific time restriction for Customs declaration at the cross-border check point. An inefficient Hong Kong-China cross-border road-freight industry will decrease the efficiency of the logistics industry in the Pan-Pearl River Delta and will have a negative effect on attracting goods from other provinces to make use of ports in Hong Kong and the Guangdong Province. According to customs and quarantine procedures now in effect, the restrictions on cross-border road freight companies are as follows:

The four-up, four-down policy

Beginning in 1994, China Customs stipulated that each cross-border trucker and his truck, trailer, or container must go "northbound" to the Mainland and come back "southbound"

together. This regulation was abolished only very recently, on January 1, 2005. Shenzhen Customs has indicated that from 1998 onwards, this regulation, although still in place, was not strictly followed. When electronic information bundling is implemented, it will be possible to separate the trucker from his truck, trailer, or container. Customs did its part to repudiate this outdated regulation, nevertheless, very few truckers operated separately from their trucks. This is because other departments did not follow suit in allowing the improvement to take place over other areas in China. For example, the licensing department still bundles a driver with his truck into one licence, making it impossible for the trucker and the truck to be separated. Thus, without parallel relaxations in this and to obtain cooperation from other relevant departments, the freight truck industry was still very much constrained by other related restrictions.

Restrictions on depots of international containers

The Shenzhen Municipal Bureau of Communications has stipulated that all containers used for international trade must use special designated depots for transshipments and re-exports.

Hence, from 2002 onwards, cross-border truckers have been able to unload their containers and pick up empty containers in these designated depots. Several port operators and liner companies in previous years have tried to set up inland depots to provide a matching service for the trucking industry but the results have been disappointing. One of the reasons is the location of these depots which are far from major routes so few cross-border truckers make use of them.

The bottleneck at vehicle examination centres

Cross-border trucks carrying goods from the processing trade must go through Customs and quarantine procedures at vehicle examination centres. Despite the fact that many vehicle examination centres have become more efficient, some still operate in an outdated fashion that was implemented in the 1980s. Officially, truckers can clear Customs between 8:00 a.m.

and 10:00 p.m., but the actual hours of operation are much shorter because Customs officers take time off for meals and shift changes, and no backup personnel are available to relieve them. This periodic understaffing situation results in frequent congestion.

Twenty-four-hour counters

Since 2002, the number of 24-hour counters available for cross-border truckers has increased from one to four at Lok Ma Chau – Huanggang check point. However, many cross-border truckers are reluctant to use these counters at night due to the reason that Customs units for checking documents and examining cargo operate separately. The night Customs unit only checks documents. The drivers, chosen for inspection, are required to wait until 6:00 a.m.,

when the cargo examination unit opens, to complete the Customs process. If the trucker is so unlucky and picked up for inspection then this overnight crossing turn out to take much longer time than a daytime crossing owing to an increased chance of being inspected and a longer waiting time. This explains why most cross-border truckers do not choose to clear Customs at night but would rather wait until morning if they think they cannot clear customs by 10:00 p.m each day.

The Huanggong Depot

The Huanggong depot can accommodate only 30 container trucks. Hong Kong cross-border freight trucks must arrive at the depot on time so that China cargo trucks can unload their containers, unseal them for Customs inspection, and then load the cargo onto Hong Kong container trucks. Truckers complain that the depot is too small to make such operations efficient and to meet their demands. By the end of 2007, the Guangdong Province will open its outgoing road network to other provinces in the country. If everything goes as plan, Customs clearance of cargo from other provinces to the Guangdong Province and then to Hong Kong can be simplified, the cost of re-exporting cargo via Hong Kong will fall, and this should attract more re-exporting business to the Guangdong Province.

ƒ Customs declaration of various types of enterprises.

The content in the following sections mainly comes from various China Customs Regulation handbooks and other related publications (Lian, 2004).

Not every enterprise in China can export products to overseas markets. Likewise, not every enterprise can import materials into China. The former type of enterprise is controlled by the Customs regulations that they must be a recognised enterprise eligible to make a Customs

declaration. The latter type of enterprise is controlled by The State Administration of Foreign Exchange under the Foreign Exchange regulations.

Those enterprises that are eligible to make a Customs declaration are termed as “Customs declaration enterprises” and they fall into three categories, (see table2.7).

When other enterprises need to import/export goods, they must consign professional or proxy Customs declaration enterprises to handle the declaration procedures of import/export goods.

Foreign-invested enterprises in the processing trade are usually self-servicing Customs declaration enterprises after their registration with the Customs office. However, plants processing materials supplied by clients are not self-servicing Customs declaration enterprises and have no Customs declarers, since they are not legal entities and have no right of import/export operations. The detailed registration procedure with the Customs office is listed in Appendix A.

After examination and approval, the Customs office will issue the Registration Certificate of Self-servicing Customs Declaration Enterprise. Any enterprise with the aforementioned certificate can handle Customs declaration procedures with Customs offices of various ports

Table 2.7 Category of Customs declaration enterprises

Category Description Example

1 Professional Customs declaration

enterprises

Enterprise providing professional service of Customs declaration of import/export goods

Customs declaration firms or service companies

2

Proxy Customs declaration enterprises

Enterprises, without the right of import/export operations, providing warehousing/transportation agent service, and also proxy service of Customs declaration

Enterprises, with the right of import/export operations, entitled to with the right of import/export operations, and foreign-invested enterprises.

Source: translate from the China Customs Regulations 2001, China Customs Press

within its Customs region. However, self-servicing Customs declaration enterprises can handle the Customs declaration procedures of their own imports/exports only, rather than those of other enterprises.

ƒ Annual assessment

The Customs office implements annual assessment systems to self-servicing Customs declaration enterprises. They must submit Annual Assessment Reports to competent Customs authorities of their own Customs regions for yearly assessment.

In China, since 1998, foreign-invested enterprises, are under the scrutiny of various government authorities comprised of the former Ministry of Foreign Trade and Economic Cooperation, the State Administration for Industry and Commerce, the State Economic &

Trade Commission, the Ministry of Finance, the State Administration of Exchange Control, the state and local taxation bureaus and the General Administration of Customs. Together, they will carry out an annual assessment on capital contribution, operations, finance, foreign exchange, and imports/exports of the enterprises. The time for the annual assessment is fixed from 1 January to 30 April and the examination work must finish before 31 May each year.

Any enterprise that fails to participate in the annual assessment is deemed to be discarding the qualification for Customs declaration automatically. If it hopes to resume the work of the Customs declaration, it must resubmit the registration application to the Customs office. For unqualified enterprises in the annual assessment, as the case may be, the Customs office shall require those enterprises to improve themselves within a given period to meet its requirements. Enterprises that fail after the grace period, will lose the qualification for Customs declaration.

Enterprises with the following criteria shall be deemed as failing to pass the annual assessment, namely those:

1. Having no import/export business for more than 1 year;

2. Being late for an annual assessment for more than 1 month;

3. Failing to contribute the statutory capital.

Enterprises with the above first or second case are deemed to be waiving the right of Customs declaration automatically and shall not be manpowered with Customs declarers. For enterprises with the third case, the Customs office shall not accept their annual assessment reports until they fully contribute the registered capital.

ƒ Variation of registration

As all the cargoes imported and exported to/from China incur the levy of tax, in order to track the origin and destination in the flow of cargo, the Customs Office will require shippers, exporters and importers to register with a particular local office. In case the particulars under registration contents in the Customs office changes (e.g. enterprise name, legal representative, registered address, corporate nature, registered capital, operation scope, contact numbers, or registered office), the enterprise shall handle the various registration procedures with the Customs office as follows:

1. The enterprise shall handle the variation registration procedures with the administration on industry and commerce;

2. The enterprise shall handle the variation procedures with the Customs office of the original registration place carrying the varied business licence within 1 month after transacting variation registration with the administration of industry and commerce.

3. The Customs office shall re-issue the Registration Certificate on Customs Declaration after examining and approving the documental data on the variation application;

4. Enterprises having transacted Customs declaration registration in another place, after handling variation registration procedures with the Customs office of the registration place, with the approval of the said Customs office, shall handle corresponding variation registration procedures with the Customs office of the said other place.

ƒ Cancellation

When an enterprise goes bankrupt or its operation term ends, it shall, carrying relevant approval documents issued by the authority approving its establishment originally, apply to cancel its registration with the Customs office of the registration place. This will recall and cancel the Registration Certificate on Customs Declaration originally issued by it.

After bringing forward the application for cancellation of the Customs declaration registration, if the enterprise has goods under the supervision of the Customs office and the said goods are within the supervision term, it shall handle matters relating to duty, paying at first to relieve the supervision by the Customs office.

For enterprises having transacted with the Customs declaration in another place, after transacting procedures of registration cancellation with the Customs office of its registration place, they shall inform the Customs office of the first registration to cancel the said recorded registration.

ƒ Corporate archive

Detailed Customs clearance can easily identify businesses which submitted wrong corporate archive data. If it is found, it will influences normal import/export activities, especially the

settlement of exchange and Customs clearance, of the enterprise. The major problem with these wrong corporate archive data comes from its own internal management.

a. False Registration.

The enterprises always pay attention to the integrity of materials submitted to the Customs office while ignoring the authenticity and validity of the materials. For example, according to provisions of the Customs office, enterprises must submit corporate financial and accounting systems and import/export-related account books to the Customs office during registration.

However, some enterprises manipulate corporate financial and accounting systems of other enterprises in order to cope with the registration with the Customs office, or even fleece the said Customs office. As a result, when the Customs office performs detailed investigations into the import/export goods of the enterprises in accordance with the systems supplied by the enterprises, it finds that the enterprises have not set up relevant account books as per the requirements of the systems. Therefore, the enterprises will be penalised by the Customs office for their provision of false data.

b. Late Annual Assessment

The enterprises are reluctant to participate in annual assessment and are late for annual assessment arranged by the Customs office. Some enterprises fail to think of handling the annual assessment procedures with the Customs office until goods for import/export materialise, some have no permanent staff responsible for such procedures or they do not participate in the assessment.

c. Failure to Apply for Corporate Data Modification

In the event of variation occurring to some registered contents, some enterprises do not apply for corporate archive data modification with the Customs office, which results in a delay in the data or even incurs errors. For example, in a joint-venture enterprise, when the Chinese

In the event of variation occurring to some registered contents, some enterprises do not apply for corporate archive data modification with the Customs office, which results in a delay in the data or even incurs errors. For example, in a joint-venture enterprise, when the Chinese