Several Supporting Measures for Further Promoting the Parallel Import of Vehicles in the China (Shanghai) Pilot Free Trade Zone

· Document Number：No. 280 [2017] of Shanghai Municipal Commission of Commerce

· Area of Law： Pilot Free Trade Zone

· Level of Authority： Local Regulatory Documents

· Date issued：09-20-2017

· Effective Date：09-20-2017

· Status： Effective

· Issuing Authority： Shanghai Municipal Committee of Commerce Shanghai Entry-Exit Inspection & Quarantine Bureau

Several Supporting Measures for Further Promoting the Parallel Import of Vehicles in the China (Shanghai) Pilot Free Trade Zone
(No. 280 [2017] of Shanghai Municipal Commission of Commerce)
All Parties:
With a view to promoting the healthy development of the automobile import market, giving full play to the first-mover advantage of the innovative and pilot measures under the parallel vehicle import framework of the China (Shanghai) Pilot Free Trade Zone ("FTZ"), further enhancing the business environment and market vitality for parallel vehicle import, and strengthening the protection of the legitimate rights and interests of consumers, these Supporting Measures are hereby put forward as follows pursuant to the Administrative Measures for Automobile Sales (Order 2017 No. 1 of the Ministry of Commerce) and other relevant laws and administrative regulations of the State, as well as in light of the actual progress of the pilot scheme of parallel vehicle import in Shanghai Municipality:
1. Pilot parallel vehicle import and routine management mechanisms
(1) Pilot parallel vehicle import in the FTZ shall refer to the business activities whereby pilot enterprises registered within the special customs regulatory zones of the FTZ or the wholly-owned subsidiaries or holding companies that are established by pilot enterprises within the special customs regulatory zones of the FTZ and that hold vehicle distribution qualifications obtain the automatic import permit for parallel vehicle import and engage in vehicle import without authorization by vehicle manufacturers.
(2) Pursuant to the unified requirements of the Ministry of Commerce ("MOFCOM"), the Shanghai Municipal Commission of Commerce and the Shanghai FTZ Administration Authority shall take the lead to be responsible for the recognition and market exit of pilot enterprises, and conduct dynamic management of pilot enterprises. In other words, the Shanghai Municipal Commission of Commerce and the Shanghai FTZ Administration Authority shall carry out appraisal of pilot enterprises on a yearly basis according to the size of their respective parallel vehicle import business, their respective performance of duties, business level, etc. in a given year, based on which, the Shanghai Municipal Commission of Commerce or the Shanghai FTZ Administration Authority shall publish notices of dynamic adjustment via its official website to encourage qualified enterprises to actively submit applications to participate in the pilot scheme of parallel vehicle import.
(3) The Shanghai Municipal Commission of Commerce and the Shanghai FTZ Administration Authority shall jointly take the lead to establish a joint conference system and a daily liaison and coordination mechanism for promoting pilot parallel vehicle import which shall involve the Shanghai Customs District, the Shanghai Entry-Exit Inspection and Quarantine Bureau, the Shanghai Municipal Commission of Economy and Informatization, the Public Security Bureau of Shanghai Municipality, the Shanghai Municipal Transportation Commission, the Shanghai Environmental Protection Bureau and other relevant departments as member entities. All departments concerned shall, on the foregoing basis, designate leadership members and daily contact persons who are responsible for work in this regard, and assign leadership members or daily contact persons to attend joint conferences. All departments concerned shall support this pilot scheme, and jointly promote the development and regulation of relevant pilot tasks according to their respective management duties.
2. It is required to simplify the application procedures for the automatic import permit and strive for innovation in other areas.
(4) Application procedures for the automatic import permit for parallel vehicle import shall be simplified. The Shanghai Municipal Commission of Commerce shall be responsible for accepting applications for the automatic import permit for parallel vehicle import, and shall forward an application for the automatic import permit by a pilot enterprise to the MOFCOM on the very day of receipt if the application satisfies all relevant conditions and is accompanied by all the required materials. After the MOFCOM has issued the automatic import permit upon examination and approval of the application, the Shanghai Municipal Commission of Commerce shall notify the pilot enterprise to collect the said permit on the same day. Shanghai-based pilot enterprises shall be able to collect the automatic import permit in Shanghai.
(5) It is imperative to support the pilot enterprises of parallel vehicle import that are registered within the FTZ and the compliance rectification sites provided thereby, push enterprises to make rectification to comply with pertinent standards in accordance with relevant policy requirements, and promote the pilot work whereby certification agencies simplify or exempt the procedures to audit overseas factories.
(6) As regards vehicles imported by pilot parallel import enterprises that meet the needs of emergency rescue, disaster relief, road testing or other specific needs of production, construction or public services and support the development of the automobile industry and the headquarters economy, it is important to innovate the model of vehicle inspection and customs clearance, lower import costs, and explore a vehicle certification model that is characterized by more effective regulation, better services and more convenient trade flow.
3. Enterprises and sites for compliance rectification of parallel vehicle import shall be accredited.
(7) Compliance rectification shall refer to the rectification activities carried out before the import of automobiles for the purpose of complying with the mandatory requirements of national technical specifications (such rectification does not involve personal and property safety, health and environmental protection). Enterprises that satisfy the prescribed conditions and are registered within the bonded areas of the FTZ shall be allowed to set up compliance rectification sites within the special customs regulatory zones of the FTZ and carry out relevant business under the premise of complying with relevant regulatory requirements of customs. Pilot enterprises of parallel vehicle import that possess relevant conditions and the rectification sites established thereby shall be assessed and accredited on a priority basis. Relevant regulatory departments shall formulate more detailed administrative measures in this regard.
(8) Enterprises shall apply to the Shanghai FTZ Administration Authority in accordance with relevant requirements. Thereafter, the Shanghai Municipal Commission of Commerce and the Shanghai FTZ Administration Authority shall take the lead to organize various departments to accredit relevant enterprises and rectification sites after collective study and comprehensive assessment of their applications, and promptly provide the enterprises with feedback on accreditation results. Where a compliance rectification site for parallel vehicle import is found to be in violation of laws and regulations, expand the scope of the compliance rectification project without authorization, fail to meet the standards of relevant regulatory departments in terms of its compliance rectification project, etc., the compliance rectification site shall be promptly dealt with after review at the joint conference, and shall be ordered to withdraw from the market under grave circumstances.
(9) Compliance rectification shall be completed within the sites that have been accredited upon assessment, and enterprises may not expand the scope of rectification without authorization. Compliance rectification sites that have been accredited upon assessment shall retain relevant data and information on compliance rectification, while enterprises shall submit the process information of compliance rectification for parallel vehicle import, import quality and safety information, quality assurance traceability, certification and regulation information, etc. to regulatory authorities as required or share such information with regulatory authorities via public service platforms.
(10) Pilot enterprises may complete rectification operations through the compliance rectification sites within the bonded areas of the FTZ that have been accredited upon assessment. As regards vehicles of parallel import that have undergone compliance rectification, pilot enterprises shall remain as the parties responsible for quality traceability, and shall perform obligations such as product recall, quality assurance, after-sales services, 3-R Guarantee ("repair, replace and refund"), etc. pursuant to the law.
4. The price review mechanism shall be optimized.
(11) Pilot enterprises of parallel vehicle import shall be allowed to adopt the "preliminary price review" regime when engaging in parallel import business. In other words, a pilot enterprise of parallel vehicle import, when importing vehicles for proprietary trading, may submit relevant trade documents to the price review department of the relevant customs office at least 15 working days prior to the actual import declaration to complete price record-filing and review procedures. In addition, more efforts shall be made to strive for impartiality in price review on the basis of the implementation of the policies of integrated customs clearance.
5. The degree of customs clearance facilitation shall be raised.
(12) It is necessary to simplify the procedures for customs declaration and inspection, and support pilot enterprises to select the Shanghai single-window system for international trade to complete customs declaration and inspection with "one application".
(13) An inspection and quarantine department shall issue accompanying inspection documents within five working days after the completion of inspection and quarantine procedures by vehicles of parallel import, and verify and write off corresponding vehicle identification numbers (VIN) in the VIN management system for imported motor vehicles. The interval between the issuance of accompanying inspection documents and the write-off of VINs shall not exceed one working day.
(14) Pilot enterprises shall be supported to adopt facilitating measures such as "outbound shipment by batch and centralized application", "consolidated tax payment", etc. to enhance the flexibility and timeliness of their business operations.
(15) Where vehicles of parallel import that have been granted customs clearance and for which taxes have been paid meet customs requirements, the Certificate of Imported Goods shall be issued within three working days to provide enterprises with trade facilitation.
6. The level of integrated services shall be raised by innovative means.
(16) It is required to support pilot enterprises or warehousing enterprises to apply for adopting the innovative measures of the FTZ pursuant to relevant provisions during the period of bonded warehousing of vehicles of parallel import, and support enterprises to engage in bonded display and trading.
(17) It is vital to encourage the introduction of inspection line services and third-party inspection agencies as supporting measures in the vicinities of the compliance rectification sites established near the special customs regulatory zones of the FTZ, and adopt facilitating measures such as "accepting the services of third-party providers" to form an assembly line model that integrates functions such as rectification within the special customs regulatory zones, inspection and issuance of reports, etc., so as to provide pilot enterprises with "one-stop" services and lower their transportation, logistics and other costs.
(18) Public security departments shall, within the FTZ, provide pilot enterprises of parallel vehicle import with facilitating operations related to motor vehicle registration, and further raise the efficiency of motor vehicle registration and other services.
(19) It is critical to provide simplified quota determination and other supporting measures for parallel vehicle import, further optimize the procedures for confirming quotas, vehicle purchase tax, etc., enhance data sharing between and among various departments, and optimize relevant services in the stage of pre-sale of motor vehicles.
(20) Efforts shall be exerted to make full use of the financial institutions within the FTZ and the financial policies applicable within the special customs regulatory zones of the FTZ, provide pilot enterprises of parallel vehicle import with financing and other supporting financial services during the procurement and sales of imported automobiles, and encourage insurance companies to support pilot enterprises in their "repair, replacement and refund" services to safeguard customers' rights and interests. It is also a must to step up support for the construction of the functions available via the parallel vehicle import service platform, help pilot enterprises reduce their overall operating costs, and further cultivate and expand the market of parallel vehicle import in Shanghai.
Appendix: Standards for the Assessment and Accreditation of Compliance Rectification
Sites for Parallel Vehicle Import