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Recently Guangdong Provincial Administration of Industry and Commerce ("Guangdong
AIC"), a local administrative authority supervising business operations
in its territory in China, revealed a list of jewelry manufacturers and
distributors selling defective jewelry products in 2012. Some of
internationally reputable jewel brands appeared on the list for
non-compliance with Chinese labeling laws, regulations or standards, or
for incorrect or improper engraving and/or labeling practices. As a
result, Guangdong AIC slapped a large amount of fines on those companies
and ordered them to recall all the defective products from the market.
This exhibits how improper labeling has affected sale of products in
China.
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The Supreme People's Court of PRC has recently issued its "Rules on Several Issues Related to Law Application concerning Adjudication of Civil Disputes Arising from Monopolistic Activities" (the "Judicial Interpretation"), which will come into effect from June 1, 2012. This Judicial Interpretation has laid out rules on the allocation of burden of proof relating to the following three cases of monopolistic activities on the basis of the PRC Anti-Monopoly Law (the "AML") and the PRC Civil Procedural Law.
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For
many products, tariff classification can be technically complex,
confusing, and subject to multiple interpretations. Often several
different Harmonized System Codes ("HS Code") may seem applicable for
one given product with different tariff rates. Tariff classification is
indeed a process of application of customs classification rules,
including customs rulings and decisions, and misclassification may
trigger severe legal consequences. The sad fact is, unfortunately, that
many companies rely on non-legal professionals to determine the HS Codes
for imports or exports. A recent interpretation issued by the General
Administration of Customs of China ("GACC") (Circular No. [2012] 495
Shu-Fa-Fa) (the "Interpretation") reinforces the process of tariff
classification as a legal matter, and formulates the test as to what
counts for regulatory violation if tariff classification rules are
improperly applied by the importer or exporter in a given case. If the
legal defense is successful, misclassification may only be treated as a
non-violation misclassification, with the possible obligation to pay up
additional customs duties, if any, but without administrative or
criminal consequences. The Interpretation took effect as from February
1, 2013.
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Original
Equipment Manufacturing(OEM), particularly cross-border OEM, is perhaps
most common model in the contemporary manufacturing world. It's now
routine for Western companies to provide design and technology know-how
and then to outsource production to China and other Asian countries
where the labour needed to manufacture a product is comparatively
inexpensive.
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On
January 4, 2013, NDRC declared that Samsung, LG and four Taiwanese
firms were fined RMB 350 million for fixing the prices of LCD screens
during the period from 2001 to 2006 (" LCD Case "). On January 16,
2013, Maotai, one of most famous wine brands in China, declared that
they were investigated by NDRC for its monopolistic behaviors and they
therefore would modify all their sales policies that had violated the
2008 Anti-monopoly Law of PRC (" AML "), in particular the resale
price maintenance policy. This was closely followed by the declaration
of WuLiangYe, another wine magnet in China, which announced on January
17, 2013 that they would also abolish all the sales policies in
violation of AML, after an investigation of NDRC.
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In this issue:
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In this issue:
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In
July of 2007, an overseas projector manufacturer modified its video
projector products (HS Code: 8528 3010, Duty Rate: 35-30%) into digital
projectors (HS Code: 8471 6090, Duty Rate: 15-10%) through a series of
technical methods, such as installing video connectors and crystal
oscillators, covering up pre-set sockets, changing buttons, modifying
relevant software, renovating outer packaging and product manuals.
Later, its subsidiary in China imported such modified products under an
HS Code applicable to digital projectors. After customs clearance, the
company had the imported products re-modified into video projectors and
sold them in China.
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Special Administrative Region by Domestic Non-financial Institutions
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CMTO Classification Is Not the Sole Criterion for Assessing the Similarity of Goods and Service
