GACC Seizure Security Bond Valuation Formulas for Export Cargo Detention
GACC detention security requires 100% FOB valuation under Article 14, tiered caps under Article 15, and mandatory double-value exporter counter-bonds under Article 19.
Article 28
Meaning
Administrative disposition rules establish the legal framework for handling confiscated counterfeit freight that has cleared formal customs forfeiture proceedings. Grounded within article 28 of the Regulations of the People’s Republic of China on Customs Protection of Intellectual Property Rights, this provision governs the mandatory sequence of actions customs authorities must follow after confirming an intellectual property infringement and issuing a final confiscation order. The primary legal directive commands the eradication of infringing elements, directing usable materials toward social welfare programs or public sales only after trademark identifiers are stripped.
Destruction remains the default statutory disposition whenever physical decoupling of infringing elements proves technically impossible or economically unviable. Title transfers through official border auctions remain strictly prohibited if genuine separation from the infringed intellectual property cannot be achieved.
Statutory Sequence
Border authorities hold a rigid statutory preference when liquidating goods formally confiscated from bad-faith shippers. Cleared merchandise is offered first to the legitimate intellectual property holder for commercial purchase at scrap valuation. If that proprietary owner declines acquisition, the regional authority coordinates with state charities to donate sanitized stock to approved public welfare institutions.
Commercial auction through authorized government trading hubs functions as a secondary disposition alternative, provided the offending brand markings have been irreversibly ground down, peeled, or excised. Unsalable inventory undergoes physical shredding, thermal destruction, or mechanical compression under direct customs surveillance when brand removal fails technical validation.
Operational Verification
Technical verification processes require appointed salvage contractors to establish that zero trace of intellectual property remains before cargo leaves state custody. Customs inspection teams monitor the physical destruction of labels, heat-stamped logos, woven marks, or embossed tags within bonded quarantine zones. Contractors document every operational phase using video logs, certified destruction certificates, and weight receipts matching the original impound declaration.
Salvaged base commodities such as generic textiles or unbranded plastic granules may enter general circulation only after customs supervisors sign formal clearance protocols. Any deviation that leaves brand features intact results in immediate cancellation of salvage operations and immediate consignation to incineration.
Disposal Finality
Corporate records reflect permanent title termination once merchandise passes through the mandatory phases established by article 28. Revenue generated through public auction transfers directly to the state treasury rather than serving as commercial compensation for the aggrieved property owner. Brand holders must seek financial damages through separate civil litigation filed in people’s courts rather than relying on border disposition funds.
Expenses accumulated across warehousing, de-branding operations, and scrap handling legally burden the registered infringer or fall back against the original confiscation proceeds. The disposition framework bars counterfeit merchandise from commercial reentry while restricting the administrative powers of disposal teams.