Meaning
Ministerial administrative legislation promulgated by the General Administration of Customs of the People’s Republic of China governs bonded materials, processing trade contracts, and customs supervision over export processing enterprises. Enacted to regulate the bonded logistics regime, the decree establishes compliance rules for processing with imported materials and processing with supplied materials across mainland manufacturing facilities. Processing manufacturers operate under customs surveillance, converting bonded imported raw materials into finished consumer goods destined for international markets.
Regulatory compliance under GAC Decree 213 requires enterprises to establish digital material ledgers that reconcile raw component intake against finished export volumes and industrial scrap rates.
Supervision Framework
Customs monitoring applies to the entire lifecycle of imported components from port arrival through production cycles to ultimate re-export. Operating enterprises must register an electronic processing trade manual or enterprise ledger with local customs authorities prior to receiving duty-free raw material shipments. This administrative filing details product bill of materials, processing techniques, expected unit consumption ratios, and anticipated export schedules.
Customs audit officers inspect factory floor production lines, warehouse storage areas, and enterprise resource planning systems to confirm physical inventory corresponds with bonded inventory records. Discrepancies between digital filings and physical warehouse assets trigger administrative investigation.
Domestic Sale
Selling bonded materials or finished processing goods into the Chinese domestic market requires strict advance approval and duty clearance procedures under administrative law. An enterprise wishing to divert inventory domestically must submit a domestic sale application, calculate import duties based on raw component valuations, and remit applicable value-added taxes alongside deferred interest fees. Diverting bonded inventory into domestic commerce without prior customs authorization constitutes a regulatory offense under GAC Decree 213, prompting monetary fines or smuggling investigations.
Scrap metals, rejected parts, and manufacturing cutoffs generated during production must be processed via authorized domestic clearance, destruction under customs supervision, or re-export.
Enterprise Assessment
Processing trade facilities undergo corporate credit profiling that dictates operational scrutiny, bond deposit requirements, and customs inspection frequencies. High-credit enterprises certified as Advanced Certified Enterprises enjoy deferred tax guarantees, lower physical inspection rates, and streamlined domestic sale reconciliation protocols. Low-credit manufacturing plants must maintain full financial deposit accounts with approved commercial banks to cover potential import duties before customs releases bonded materials.
Failure to maintain balanced electronic ledgers under the decree leads to operational suspension, manual registration cancellation, and administrative penalties that paralyze contract manufacturing workflows.
