Export Control Law of the People's Republic of China (2020 edition)

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Promulgation Date: 2020-10-17
Title: PRC Export Control Law 
Document Number: Fafa (2020) #38主席令13届58
Expiration date: 
【颁布单位】全国人民代表大会常务委员会
Source of text: http://www.xinhuanet.com/politics/2020-10/18/c_1126624518.htm

This translation is reposted with gracious permission from Covington & Burling LLP. Some Changes may be made through the normal use of this site. Original available here: 
 

Contents

Chapter I: General Provisions

Chapter 2 Control Policies, Control Lists, and Control Measures

Section 1: Ordinary Provisions

Section 2 Administration of Export of Dual-use Items

Section 3 Administration of Export of Military Items

Chapter 3 Regulation

Chapter IV: Legal Responsibility

Chapter V: Supplementary Provisions

PRC Export Control Law

  Chapter I: General Provisions

Article 1: This Law is established to safeguard national security and interests, perform non-proliferation and other international obligations, and enhance and regulate export control.

Article 2: This Law applies to the State’s export control over dual-use items, military items, nuclear items and other goods, technologies, services and items relating to the maintenance of national security and national interests, and performance of antiproliferation and other international obligations (collectively referred to as “Controlled Items” hereinafter).

The term Controlled Items referred to in the previous provision includes technical information and other data related to the items.

For the purposes of this Law, export control means the prohibitive or restrictive measures taken by the State against the transfer of any Controlled Items out of the People’s Republic of China, and the provision of any Controlled Items by any citizens, legal persons or non-corporate organizations of the People’s Republic of China to any foreign organizations and individuals.

For the purposes of this Law, dual-use items mean goods, technologies and services that can be used for not only civil purposes but also military purposes, or that are helpful to enhance military potential, especially those can be used for the design, development, manufacturing or use of weapons of mass destruction and their delivery vehicles.

For the purposes of this Law, military items mean equipment, special production equipment and other related goods, technologies and services used for military purposes.

For the purposes of this Law, nuclear items mean nuclear materials, nuclear equipment, non-nuclear materials for reactors and related technologies and services.

Article 3: Export control work should uphold a comprehensive national security perspective, maintain international peace, plan security and development as a whole, and improve export control administration and services.

Article 4: The State implements a unified export control system, and oversees the system by making control lists, directories, and catalogues (collectively referred to as “Control Lists”), and implementing export licensing.

Article 5: The departments of the State Council and the Central Military Commission that perform the export control functions (collectively the “State Export Control Administrative Departments” or SECADs) are responsible for tasks relating to export control according to their assigned duties. The other departments of the State Council and the Central Military Commission are duly responsible for the related tasks according to their assigned duties.

The State establishes an export control coordination mechanism, and makes overall arrangements for and coordinates key export control matters. The SECADs and the related departments of the State Council shall work closely and share information with each other.

The SECADs are to work with the related departments to establish an expert consultancy mechanism for export control to advise on the export control affairs.

The SECADs issue guidance on export control for the related industries at appropriate times, and guide export operators in establishing sound export control internal compliance systems and proper operations.

The related departments of all provinces, autonomous regions and municipalities directly under the central government are responsible for the tasks relating to export control in accordance with laws, regulations and administrative rules.

Article 6: The State shall strengthen international cooperation on export control, and participate in the making of international rules relating to export control.

Article 7: Export operators may establish and join self-regulatory industrial organizations such as chambers of commerce and associations in accordance with the law.

The related self-regulatory organizations such as chambers of commerce and associations shall comply with laws and administrative regulations, and provide their members with the services relating to export control pursuant to their bylaws, and exercise their coordination and self-regulatory functions.

  Chapter 2 Control Policies, Control Lists, and Control Measures

  Section 1: Ordinary Provisions

Article 8:The SECADs are to work with the related departments to establish export control policies of which major policies shall be submitted to either the State Council for approval or the State Council and the Central Military Commission for approval.

The SECADs may assess the countries and regions to which the Controlled Items will be exported to determine the risk level and take corresponding control measures.

Article 9: The SECADs are to work with the related departments pursuant to required procedures to establish and adjust the export control lists for Controlled Items and promptly publish such lists in accordance with the provisions of this Law and related laws and administrative regulations as well as export control policies.

As required for the maintenance of national security and national interests and the performance of anti-proliferation and other international obligations , with the approval of the State Council, or with the approval of the State Council and the Central Military Commission, the SECADs may exercise temporary control over any goods, technologies and services outside the export control lists, and make an announcement of such. A temporary control can be enforced for a term of up to two years. Before the expiration of the temporary control term, an assessment shall be carried out in a timely manner, and, depending on the assessment results, a decision on cancellation of temporary control, extension of temporary control, or inclusion of items under temporary control in the export control lists is to be made.

Article 10: As required for the maintenance of national security and national interests and the performance of anti-proliferation and other international obligations , with the approval of the State Council, or with the approval of the State Council and the Central Military Commission, the SECADS may work with the related departments to prohibit the export of the related Controlled Items, or prohibit the export of the related Controlled Items to certain destination countries and regions, certain organizations and individuals.

Article 11: Where export operators export Controlled Items, they shall comply with the provisions of this Law and administrative regulations; where the qualifications for export of the related controlled items are required according to the law, such qualifications shall be obtained.

Article 12: The State implements a licensing system for the export of Controlled Items.

For the export of Controlled Items listed on the control lists and the items subject to temporary control, export operators shall apply for a license to the SECADs.

For the export of any goods, technologies or services that are not Controlled Items on the export control lists or the items subject to temporary control and that may have any of the following risks of which an export operator is or should be aware or is notified by the SECADs, the export operator shall apply for an license to the SECADs:

(1) endangering national security or national interests;

(2) being used for the design, development, production or use of weapons of mass destruction and their delivery vehicles; or

(3) being used for terrorist purposes.

Where an export operator is unable to confirm whether any goods, technologies and services to be exported are Controlled Items under this Law, and consult with the SECADs for that, the SECADs shall respond in a timely manner.

Article 13: The SECADs will take all of the following factors into account in reviewing an export operator’s application for the export of Controlled Items, and make an approval or non-approval decision:

(1) national security and national interests;

(2) international obligations and commitments;

(3) type of export;

(4) sensitivity of the items;

(5) destination country or region of the export;

(6) end users and end uses;

(7) credit record of the export operator;

(8) other factors provided in laws and administrative regulations.

Article 14: Where an export operator establishes an internal compliance system for export control compliance, and the system works well, the SECADs may grant facilitation measures such as a general license for the export of the related Controlled Items by such export operator. The specific measures will be provided by the SECADs.

Article 15: Export operators shall submit to the SECADs documents certifying end users and end use of the controlled items, and the related certifying documents are to be issued by a national or local government agency in the place where such end-use or end-users are located.

Article 16: The end-users of Controlled Items shall undertake not to alter the end use of the related Controlled Items or assign the related Controlled Items to any third party without the approval of the SECADs.

Where an export operator or importer becomes aware of any possible change of the end-users or end use, it shall immediately report to the SECADs as required.

Article 17:Where an export operator or importer becomes aware of any possible change of the end-users or end use, it is to immediately report to the SECADs as required.

Article 18: The SECADs are to establish a restricted [or control] list for importers and end-users that:

(1) violate the requirements regarding the management of end users and end uses

(2) may endanger national security or national interests; or

(3) use Controlled Items for terrorist purposes.

For importers and end users that are included on the restricted list, the SECADs may take necessary measures such as prohibiting or restricting the related deals relating to Controlled Items, ordering the suspension of export of the related Controlled Items, and withholding export licensing facilitation measures.

Export operators must not enter into any transactions with any importer or end user that is included in the restricted list in violation of the rules. Where an export operators has a true need to enter into a transaction with an importer or end user on the restricted list, it can submit an application to the SECADs.

For importers and end users that are included on the restricted list, where the circumstances referred to in paragraph (1) are eliminated upon implementation of relevant measures, such importers and end users may submit an application to the SECADs for removing them from the restricted list; the SECADs may, based on the actual situation, determine to remove such importers and end users from the restricted list.

Article 19: When a shipper or customs broker of export goods seeks to export any controlled goods, it shall submit licensing documents issued by the SECADs to the customs for verification, and go through customs formalities in accordance with applicable government policies.

Where a shipper of exported goods fails to submit licensing documents or certifying documents for any related licensing facilitation measures issued by the SECADs to the customs for verification, and the customs has evidence that the goods to be exported may be subject to export control, the customs shall challenge the shipper on the goods to be exported; the customs may request appraisal by the SECADs, and handle the matter lawfully according to the appraisal results of the SECADs. During the appraisal or challenge period, the customs will not grant clearance to the exported goods.

Article 20: No organizations or individuals shall provide any agency, shipping, delivery, customs clearance, third-party e-commerce trading platform and financial services for any export operator engaging in any export control violations.

  Section 2 Administration of Export of Dual-use Items

Article 21: When an export operator applies for export of dual-use items to the State’s administrative department for the export control over dual-use items, it shall submit truthful related materials in accordance with laws and administrative regulations.

Article 22: The State’s administrative department for the export control over dual-use items accepts applications for the export of dual-use items, and are to review the applications for the export of dual-use items in accordance with the provisions of this Law and administrative regulations either independently or by working with the related departments, and make a decision within a statutory period on approval or nonapproval. Where an approval decision is made, an export license is to be issued by the license issuing authority exclusively.

  Section 3 Administration of Export of Military Items

Article 23: The State implements a qualification system for the export of military items. Operators engaging in export of military items shall obtain the qualification for export of military items, and engage in the business activities for export of military items within the authorized business scope.

The qualification for export of military items is to be reviewed and approved by the State’s administrative department for the export control over military items.

Article 24: An export operator of military items shall apply to the State’s administrative department for the export control over military items for the review and approval of initiation of the project of export of military items, the project of export of military items and contract on export of military items in accordance with the control policies and the products’ properties.

The initiation of major projects of export of military items, major projects of export of military items and major contracts on export of military items shall be reviewed by the State’s administrative department for the export control over military items by working with the related departments, and submitted to the State Council and the Central Military Commission for approval.

Article 25: An export operator of military items shall apply to the State’s administrative department for the export control over military items for the export license for military items before exporting any military items.

When exporting military items, an export operator of military items shall submit the licensing documents issued by the State’s administrative department for the export control over military items to the customs for verification, and go through the customs formalities in accordance with applicable government policies.

Article 26: An export operator of military items shall engage an approved carrier for the export of military items to perform the transport and other services for the export of military items. The specific measures are to be provided by the State’s administrative department for the export control over military items by working with the related departments.

Article 27: Where an export operator of military items or a scientific research and production institution participates in an international exhibition of military items, it shall go through the review and approval formalities with the State’s administrative department for the export control over military items in accordance with applicable procedures.

  Chapter 3 Regulation

Article 28: The SECADs are to lawfully supervise and inspect the activities regarding export of Controlled Items.

The SECADs may take the following measures against any suspected violation of any provisions of this Law:

(1) entering the place of business or any other related site of the investigated person for inspection;

(2) interviewing the investigated person, interested parties, or other related organizations or individuals, and asking them to provide explanation related to the investigated matters;

(3) examining and duplicating the related documents, agreements, accounting books, business correspondence and other files and information of the investigated person, interested parties or other related organizations or individuals.

(4) checking the delivery vehicles used for the export, preventing the loading of suspicious export items, and ordering the withdrawing of illegally exported items;

(5) Confiscating and seizing the related items involved in the investigation; and

(6) Examining the bank accounts of the investigated person;

To take the measures in paragraphs (5) and (6) above, the written approval of a person in charge of the SECADs is required.

Article 29: The SECADs are to perform their duties in accordance with laws, and the related departments of the State Council, as well as local people’s governments and their relevant departments, shall provide assistance therefor.

The SECADs are to, in accordance with laws, perform the regulatory, inspection, and investigation duties independently or by working with the related departments, and the involved organizations and individuals shall cooperate with rather than refuse or obstruct the performance of such duties.

The involved government departments and their employees shall be legally bound to keep any national secrets, trade secrets, personal privacy, and personal information that become known to them in the investigation confidential.

Article 30: To enhance the administration of export of Controlled Items, and prevent the risks of illegal export of Controlled Items, the SECADs may take measures such as holding a regulatory interview or issuing a warning letter.

Article 31: Any organization and individual has the right to report any suspected violation of the provisions of this Law to the SECADs, and SECADs shall handle the report upon receipt thereof in a lawful and timely manner, and keep the identity of the reporting person(s) confidential.

Article 32: The SECADs are to cooperate and communicate with the other countries or regions and international organizations, etc. on export control in accordance with the international treaties concluded or ratified by China or on the basis of principles of equality and reciprocity.

Any provision of export control-related information by an organization or individual within the territory of the People’s Republic of China to those outside of the territory of the People’s Republic of China shall be in conformity with laws; in case of any possibility of endangering the national security or national interests, such provision of information is prohibited.

  Chapter IV: Legal Responsibility

Article 33: Where an export operator engages in any export of Controlled Items without obtaining the qualification for export operations with respect to relevant Controlled Items, [the authorities are to] issue a warning, order that the violation be stopped, confiscate any illegal income, and impose a fine that is greater than five times of and smaller than ten times of the illegal turnover where the illegal turnover is more than RMB 500,000, or a fine that is greater than RMB 500,000 and smaller than RMB 5 million where there is no illegal turnover or the illegal turnover is less than RMB 500,000.

Article 34: Where an export operator has committed any of the following violations, [the authorities are to] order the violation to be stopped, confiscate any illegal income, and impose a fine that is greater than five times of and smaller than ten times of the illegal turnover where the illegal turnover is more than RMB 500,000, or a fine that is greater than RMB 500,000 and smaller than RMB 5 million where there is no illegal turnover or the illegal turnover is less than RMB 500,000; in serious cases, the export operator is to be ordered to suspend business for rectification, and its qualification to export related Controlled Items may even be revoked.

(1) exporting any Controlled Items without approval;

(2) exporting any Controlled Items beyond the approved scope specified in the export license; or

(3) exporting any Controlled Items that are prohibited from being exported.

Article 35: Where any license for the export of Controlled Items is obtained by fraudulent or corruptive or other improper means, or is transferred illegally, [the authorities are to] withdraw the approval and revoke the export license, and confiscate any illegal income, and impose a fine that is greater than five times of and smaller than ten times of the illegal turnover where the illegal turnover is more than RMB 200,000, or a fine that is greater than RMB 200,000 and smaller than RMB 2 million where there is no illegal turnover or the illegal turnover is less than RMB 200,000.

Where any license for the export of Controlled Items is forged, falsified, purchased or sold, [the authorities are to] confiscate any illegal income, and impose a fine that is greater than five times of and smaller than ten times of the illegal turnover where the illegal turnover is more than RMB 50,000, or a fine that is greater than RMB 50,000 and smaller than RMB 500,000 where there is no illegal turnover or the illegal turnover is less than RMB 50,000.

Article 36: Where any person provides any agency, shipping, delivery, customs clearance, third-party e-commerce trading platform, financial, and other services for any export operator in the circumstances of knowing such operator’s engagement in export control violations, [the authorities are to] issue a warning, order that the violation be stopped, confiscate any illegal income, and impose a fine that is greater than three times of and smaller than five times of the illegal turnover where the illegal turnover is more than RMB 100,000, or a fine that is greater than RMB 100,000 and smaller than RMB 500,000 where there is no illegal turnover or the illegal turnover is less than RMB 100,000.

Article 37: Where an export operator violates the provisions and enters into a transaction with an importer or end user on the Restricted List, [the authorities are to] issue a warning, order that the violation be stopped, confiscate any illegal income, and impose a fine that is greater than ten times of and smaller than twenty times of the illegal turnover where the illegal turnover is more than RMB 500,000, or a fine that is greater than RMB 500,000 and smaller than RMB 5 million where there is no illegal turnover or the illegal turnover is less than RMB 500,000; in serious cases, the export operator is to be ordered to suspend business for rectification, and its qualification to export related Controlled Items may even be revoked.

Article 38: Where an export operator refuses or obstructs any regulatory inspection, [the authorities are to] issue a warning, and impose a fine of greater than RMB 100,000 and smaller than RMB 300,000; in serious cases, the export operator is to be ordered to suspend business for rectification, and its qualification to export related Controlled Items may even be revoked.

Article 39:For an export operator punished for any violation of this Law, as from the date when the penalty decision becomes effective, the SECADs may refuse to accept any export license application submitted by such operator within five years; any supervisors directly responsible for such violation or any other directly responsible persons may be prohibited from engaging in relevant export operation activities within five years, and any person who receives any criminal penalty for any export control violation must not engage in relevant export operation activities during his/her lifetime.

The SECADs are to include such export operator’s violations of this Law into its credit record in accordance with laws.

Article 40: The SECADs are to impose a punishment as to the export control violations stipulated in this Law; to the extent that Customs is authorized by laws and administrative regulations to punish, Customs is to impose a punishment in accordance with this Law.

Article 41: Where a relevant organization or individual is dissatisfied with a decision of non-approval made by the SECADs, they may apply for administrative reconsideration lawfully. The decision of the administrative reconsideration is final.

Article 42: Where any State functionary neglects his/her duties, plays favorites and commits irregularities, or abuses their authority or position in export control management, such functionary is to be punished in accordance with the law.

Article 43: Anyone who violates the relevant export control regulations of this Law and endangers national security and national interests, in addition to the punishment in accordance with this Law, shall also, in accordance with relevant laws and administrative regulations, be dealt with and punished.

Anyone who violates the provisions of this Law and exports Controlled Items prohibited by China, or exports Controlled Items without a license, is to be investigated for criminal responsibility according to law.

Article 44:Any organization or individual outside of the territory of the People’s Republic of China that violates the provisions of this Law in relation to administration of export control, endangers the national security and national interests of the People’s Republic of China, [and] hinders the performance of non-proliferation and other international obligations, is to be subject to investigation and legal liability in accordance with the law.

  Chapter V: Supplementary Provisions

Article 45:The transit, transshipment and through shipment, re-export of any Controlled Items or the export of any Controlled Items from bonded areas, export processing zones and other areas specially regulated by the customs and regulated bonded places such as regulated export warehouses and bonded logistics centers is to be governed by the applicable provisions of this Law.

Article 46:For any matter concerning the export of nuclear and other Controlled Items not covered herein, the provisions of applicable laws and administrative regulations apply.

Article 47:For the export of any military items to be used for overseas military force, foreign military exchanges and military aid, etc., the provisions of applicable laws and regulations apply.

Article 48:Where any country or region abuses export control measures to endanger the national security and national interests of the People’s Republic of China, the People’s Republic of China may, based on the actual situation, take reciprocal measures against that country or region.

Article 49: Article 49 This Law is to take force on December 1, 2020.

 

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