the State Administration of Foreign Exchange

Notice of the State Administration of Foreign Exchange on the
Relevant Issues concerning Further Simplifying the Formalities
for Foreign Exchange Payment and Verification in Import Trade

Hui Fa [2005] No. 67

The branches and foreign exchange departments of the State
Administration of Foreign Exchange of all provinces,
autonomous regions and municipalities directly under the
Central Government, and the municipal branches of the State
Administration of Foreign Exchange in Shenzhen, Dalian,
Qingdao, Xiamen and Ningbo and all the designated
Chinese-funded foreign exchange banks:

For the purpose of further improving the foreign exchange
administration of current accounts and promoting the
facilitation of trade, the State Administration of Foreign
Exchange (hereinafter referred to as the SAFE) has made the
decision to simplify the formalities for foreign exchange
payment and verification in import trade. The Notice on the
relevant issues is hereby promulgated as follows:

I. Simplifying the vouchers on verification of foreign
exchange payment in import trade
1. The provision that a letter of guarantee for the advanced
payment shall be offered when an enterprise pays foreign
exchange for importing the goods subject to advanced payment,
shall be abolished, and an enterprise shall, upon the strength
of the verification form of foreign exchange payment in import
trade, the import contract, nominal invoices as well as other
concerned documents, go through the formalities for foreign
exchange payment at the designated foreign exchange bank
(hereinafter referred to as the bank).
2. The provision that the vouchers on the verification of
foreign exchange payment in import trade include the import
license, automatic import registration certificate and the
import bill of lading under the payment upon delivery, shall
be abolished, and an enterprise needs not to offer any of the
aforesaid documents when going through the formalities for
foreign exchange payment at the bank.
II. Simplifying the administration on the List of Import
Entities Making External Payment of Foreign Exchange
(hereinafter referred to as the List)
1. When applying for entering into the List, the enterprise,
which has opened a current foreign exchange account as
examined and approved by the branch or sub-branch of the SAFE
(hereinafter referred to as the foreign exchange bureau),
needs not to provide the form of archival filing and
registration of import and export rights, the industrial and
commercial business license and the certificate of code of the
technical supervision bureau, etc. any more, and may directly
apply for entering into the List upon the strength of the
third copy of the Document on Approval of Foreign Exchange
Business under Current Accounts for the enterprise to keep and
an application form for the registration in the List of import
entities.
2. The provision that an enterprise whose industrial and
commercial business license is only valid for less than one
year may not make registration for entering into the List
shall be abolished.
3. The provision that an enterprise which has not operated
import business for two consecutive years shall be deleted
from the List" shall be abolished.
III. Canceling the record-keeping management of foreign
exchange payments in import trade for the cases under which
the business entity declared for imported goods is
inconsistent with the entity that pays foreign exchange, and
simplifying the formalities for foreign exchange payment and
verification in import trade
1. Canceling the archiving administration of foreign exchange
payments in import trade for the cases under which the
business entity declared for imported goods is inconsistent
with the entity that pays foreign exchange
The entity declared for imported goods may, via the function
of online delivery of documents of the China E-port Outward
Remittance System of Foreign Exchange, submit the original
e-accounts of the customs declaration forms for imported goods
to the paying bank; or an enterprise that needs to pay foreign
exchange may, upon the strength of the verification form of
foreign exchange payments in import trade, the customs
declaration form for imported goods, import contract,
commercial invoices as well as the agency agreement, directly
go to the bank to handle the procedures for paying foreign
exchange with the China E-port Enterprise IC Card of the
business entity declared for imported goods. The bank shall
examine the authenticity of the relevant certificates, check
and write off and settle the original e-accounts of customs
declaration form for imported goods.
2. Where an enterprise handles the verification operations
upon the strength of the customs declaration form for imported
goods in which the business entity declared for imported goods
is inconsistent with the entity that pays foreign exchange, it
needs not to provide to the foreign exchange bureau the import
license, automatic import registration certificate, tax-free
certificate or other approval document.
When handling the formalities for verification and
cancellation, the foreign exchange bureau shall check the
verification form of foreign exchange payment in import trade,
import contract, record-keeping form of foreign exchange
payment in import trade (if record-keeping is required), the
customs declaration form for imported goods as well as the
agency agreement, and check and write off and settle the
original e-accounts of the customs declaration form for
imported goods by using Super-financial IC Cards..
IV. Relaxing the record-keeping management of foreign
exchange payments in import trade for the payment in other
places
1. The provision that no certificate may be issued and no
foreign exchange may be paid if an enterprise making payment
in other places has no branch, no loan for projects or no
current foreign exchange account at the place where the
foreign exchange is paid, shall be abolished.
When handling the issuance of certificates or paying foreign
exchange in other places, an enterprise shall, upon the
strength of the letter of record-keeping application , the
import contract, the agency agreement (it shall be offered in
the case of agency by mandate) affixed with its seal, as well
as the relevant documents as prescribed by the SAFE under
different settlement methods, go through the formalities for
archival filing of foreign exchange payment in import trade as
the payment in other places at the foreign exchange bureau at
the place where the enterprise has made registration. The bank
at the place where the enterprise pays foreign exchange shall,
upon the strength of the registration form of foreign exchange
payment in import trade, the verification form of foreign
exchange payment in import trade as well as the documents as
proscribed by the provisions on the administration of selling
and payment of foreign exchange, conduct the business of
foreign exchange payment in other places. In the case of
foreign exchange payment subject to the payment upon delivery,
it is necessary for the bank to check the authenticity of the
customs declaration form for imported goods via the China
E-Port Outward Remittance System of Foreign Exchange, and to
check and write off and settle the original e-accounts of the
customs declaration form for imported goods.
2. As to the registration form of foreign exchange payment in
import trade that is issued by the local foreign exchange
bureau at the locality of an enterprise that make the payment
in other places, the procedures for authenticity verification
by calls and confirmation by affixing the seal of the foreign
exchange bureau at the place where the enterprise pay foreign
exchange shall be cancelled, and the enterprise may directly
handle the procedures for certificate issuance or foreign
exchange payment at the bank where the foreign exchange is
paid.

V. The provisions in Articles 1, 3 and 4 of this Notice shall
not be applicable to those enterprises that are not listed
into the List or into the Name list of Import Entities Subject
to the Authenticity Examination and Approval of the SAFE.

VI. This Notice shall not apply to those special economic
areas such as bonded zones. As for the enterprises within
enclosed customs supervision zones such as bonded zones which
have obtained the rights to conduct foreign trade, they shall
be governed by this Notice when going through the formalities
for verification of foreign exchange payment in import trade.

VII. This Notice shall come into force as of October 1, 2005.
And in the case of any conflict between the previous
provisions and this Notice, the latter shall prevail.
Upon receipt of this Notice, every branch shall promptly
transmit it to the sub-branches and foreign-funded banks under
their respective jurisdiction, and every designated
Chinese-funded foreign exchange bank shall promptly transmit
this Notice to its branches and sub-branches. Any question
encountered during the implementation of this Notice shall be
promptly fed back to the Current Account Administrative
Department of the SAFE.