Tier Two Sub-Component Utility Model Patent Verification before Coastal Exit Clearance
Verify tier-two utility model patents via CNIPA and GACC databases before export clearance to prevent customs detention and demurrage losses.
GACC Decree 114
Meaning
Administrative regulations issued by the General Administration of Customs establish the framework for the classification, auditing, and risk management of intellectual property cases at Chinese borders. The GACC Decree 114 governs how customs officers handle suspected infringing goods and how rights holders must apply for border protection. It standardizes enforcement practices across all regional customs offices to ensure consistent application of the law.
Procedural Rule
The regulation sets out the timeline and the financial requirements for detaining suspected shipments, including the calculation of security deposits. Under GACC Decree 114, the rights holder has three working days to decide whether to request detention and provide the necessary bond after being notified of a suspected shipment. If they fail to respond within this window, the cargo is released.
This rule balances the protection of intellectual property with the need to maintain the flow of legitimate trade.
Risk Management
Customs houses use the guidelines to assess the risk level of exporters and determine the frequency of physical inspections for specific types of cargo. The GACC Decree 114 encourages the use of advanced scanning technology and database integration to identify potential infringements without slowing down port operations. Exporters who are found to have violated these rules repeatedly face higher inspect rates and tougher scrutiny.
This risk-based approach allows authorities to focus their resources on high-risk shipments.
Compliance Consequence
Manufacturing companies must align their shipping and licensing records with the requirements of this decree to avoid costly delays at the border. Compliance with GACC Decree 114 helps exporters maintain their trusted trader status, which grants them faster clearance and lower bond requirements. If a company’s goods are seized and found to be infringing, it faces heavy fines, confiscation of the products, and a reduction in its customs credit rating.
This can seriously disrupt production schedules and damage relations with international clients.