WT/TPR/M/300/Add.1  
9 September 2014  
(14-5091)  Page: 1/456  
Trade Policy Review Body 
1 and 3 July 2014 Original: English/Spanish  
anglais/espagnol  
inglés/español  
 
 
 
  TRADE POLICY REVIEW 
CHINA 
MINUTES OF THE MEETING 
Addendum 
Chairperson: H.E. Mrs. Mariam MD Salleh (Malaysia) 
This document contains the advance written ques tions and additional questions by WTO Members, 
and replies provided by China.1 
 
 
Organe d'examen des politiques commerciales 
1 et 3 juillet 2014 
EXAMEN DES POLITIQUES COMMERCIALES 
CHINE 
COMPTE RENDU DE LA RÉUNION 
Addendum 
Présidente: S.E. Mme. Mariam MD Salleh (Malaisie) 
Le présent document contient les questions écrites communiquées à l'avance par les 
Membres de l'OMC, leurs questions additionnell es, et les réponses fournies par la Chine. 
 
 
Órgano de Examen de las Políticas Comerciales 
1 y 3 de julio de 2014 
EXAMEN DE LAS POLÍTICAS COMERCIALES 
CHINA 
ACTA DE LA REUNIÓN 
Addendum 
Presidenta: Excma. Sra. Mariam MD Salleh (Malasia) 
En el presente documento figuran las preguntas presentadas anticipadamente por escrito y 
las preguntas adicionales de los Miembros de la OMC, así como las respuestas facilitadas por 
China.1 
                                               
1 In English and Spanish only./En  anglais et espagnol seulement./En inglés y español solamente. WT/TPR/M/300/Add.1 
 
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 1  QUESTIONS BY PAKISTAN 
Question 
Amidst a transition to the consumption based model, China has retained its competitive strength in 
international trade. What role does China envisage for its international trade when a successful 
transition to a model based on domestic consumption? 
Answer 
As an important part of China's open economic sy stem, international trade plays a crucial role in 
promoting economic growth, driving industrial de velopment and guaranteeing energy and resource 
supply and is also of positive significance in expanding employment, increasing people's income, 
promoting competition in the domestic market, enriching commodity and service supply and 
facilitating consumption structure upgrading. Theref ore, in the process of promoting the economic 
transformation depending more on domestic demand , particularly consumer demand, we still have 
to actively develop and constantly improve the quality and level of international trade in order to 
expedite sustainable and sound economic development in the new context of economic 
globalisation.  
Question 
The present Report reveals China moving well into the direction of reducing imbalances in its 
economy. However, reference is made to the IMF's assessment (e.g. that additional sources of vulnerability include possible contingent liabiliti es related to the financial sector, state-owned 
enterprises (SOEs), and actuarial shortfalls in th e pension system), adding that a decisive shift 
towards a more consumer-based economy has yet to occur. China is requested to offer its 
comments.  
Answer 
The Chinese Government has been committed to driving economy towards a more balanced and 
sustainable development model; during this proc ess, there are some contradictions and possible 
risks. To this end, we are focusing on addressing  systematic issues by deepening reform in an all-
round way and innovating and improving relevant systems. The Chinese Government has upheld 
expanding domestic demand and consumer demand in  particular as an ultimate objective of long-
term sound economic development. Over the past three years, China's economic growth has made 
positive contributions to global economic growth and re-balance. With regard to consumption 
expansion, the Government framework has been established and improved.  
First, China has adopted comprehensive measures to  strengthen residents' spending capacity. We 
have implemented proactive employment policies, including vigorously developing service 
industries, SMEs and private economy with high employment capacity, improving employment and 
entrepreneurship assistant policies, strengthening vocational skill training and increasing public-welfare service jobs. Moreover, we have deepened reform on income distribution system and 
promoted continuous income increase of farmers and low- and middle-income urban residents by 
improving agricultural subsidy policies and keeping up-regulating minimum wage standard and pension for retired workers and raising the threshol d of individual income tax. We have improved 
social security system and accelerated the cons truction of basic medical and endowment systems 
covering both urban and rural areas as well as urban government-subsidized housing projects.  
Second, China has actively cultivated new consumption growth points. In Answer to the trend of 
resident consumption structure upgrading, we have focused on strengthening infrastructure 
construction, relaxed control over market access and improved fiscal, tax and financial support 
policies targeting at hot consumption sectors su ch as housing, automobile and environment-
friendly products, consumption sectors such as tour ism, information, culture, nursing home, health 
and educational training, and new type of consumption mode such as e-retailing.  
Third, China has focused on fostering a favourable consumption environment. We have vigorously 
developed urban and rural commerce and trade and logistics infrastructure networks, improved e-commerce payment and security guarantee system, a ccelerated the establishment of social credit 
system and credit rewarding and punishing mechan ism, enhanced supervision on food and drug 
quality and safety, intensified effort in punishing illegal infringements upon consumers' rights and 
interests and endeavoured to foster an environment for secure and reassuring consumption. WT/TPR/M/300/Add.1 
 
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 Along with constant effects in consumption expansion policy, the contribution of final consumption 
to economic growth has been on a significant ri se and has maintained above 50% over the past 
years. In the first quarter of 2014, final cons umption drove economic growth by 5.7% or 
contributed to 76.7% to economic growth.  
Question 
The Secretariat Report states that China's trade and investment policy is managed and fine-tuned 
through a number of legal instruments, including Central Government Five-Year Plans, sectorial 
and provincial Five-Year Plans and different Catalogues, adding that the different layers of regulation, esp. with reference to Catalogues, add an  additional level of difficulty when trying to 
unravel specific policy measures in China. Does China have any plans to streamline/shift away 
from the system of Catalogues for the sake of ease of use and greater transparency?  
Answer 
First of all, China's Five-year Plan is not a guid ing catalogue but an overall blueprint for economic 
and social development proposed by governments at all levels. It mainly explicitly defines matters 
and issues within the scope of government respon sibilities. The Five Plans are prepared based on 
full linkages and extensive opinion solicitations and are released to the public after being reviewed 
and deliberated by the people's congresses at all le vels. There are no problems of multiple layers 
and non-transparency. 
Secondly, in regard to industrial planning, the Chinese Government has guided industrial 
development in the form of guiding catalogues wh ich are equal, fair and open to various market 
players during implementation and are periodically amended according to implementation 
situations.  
Next, we will uphold the spirits of the 18th National Congress of the CPC and the Third Plenary 
Session of the 18th Central Committee of the Chinese Communist Party, let market play a decisive 
role in resource allocation and give a better play to government to facilitate constant reforms and innovations on planning systems and promote fu rther improvement of our planning systems. 
Question 
According to the Secretariat, customs procedures across the country still require harmonization. In 
addition, none of the trade facilitation measures implemented so far apply to goods subject to licensing or other restrictions. Could China explain any measures to enhance harmonization and 
whether there are plans to apply trade facilitation measures to goods subject to licensing or other 
restrictions.  
Answer 
The statement that "customs procedures across the country still require harmonization" is 
ambiguous. If it refers to customs clearance process of goods, all customs in China apply H2010 customs management system which does not "require harmonization".  
China Customs has constantly optimised environment for port customs clearance, accelerated port 
customs clearance and formed a series of customs facilitation measures including declaration in advance, centralised declaration and appointment- based customs clearance, effectively promoting 
trade facilitation development.  
As a law enforcement department, Chinese Customs has always adhered to administration in strict 
accordance with law as well as unified and standard law enforcement to ensure the implementation of the Customs Law and other relevant laws and regulations in an all-round, 
accurate and harmonised way within the entire customs territory. Moreover, it has guaranteed and 
promoted customs procedure harmonisation in China by comprehensively advancing national campaign of customs legal construction and constantly deepening reform on customs clearance 
operation.  
We have intensified effort in legislation to constantly improve the customs law enforcement basis 
system and strengthened legal enforcemen t harmonization to guarantee harmonised 
implementation of the Customs Law and other relevant laws and regulations in various regions and 
ports. In addition, we have regulated customs discretion, strengthened the legal supervision  WT/TPR/M/300/Add.1 
 
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 function of administrative review and enhanced legal awareness and legal quality of all customs 
staffs to do a good job in harmonisation of customs procedures.  
Question 
The Secretariat Report considers that export licen ces may be required for goods subject to export 
restrictions. These measures are in place mainly to protect the environment and to preserve natural resources. However, it would appear that, in practice, these and other measures affecting 
exports have been used as policy instruments to encourage or discourage exports as necessary to 
meet industrial development goals. Could China offer its comments on this statement?  
Answer 
China has no intention to restrict or distort the trade. Furthermore, China has no intention to 
protect the domestic sectors through imposing the export restriction measures as well. The 
purpose of export restriction on the products which are high-polluted, energy-consuming, or 
consuming renewal natural resource is China have to deal with the environment issues. The WTO 
rules attach more importance in trade liberalizat ion, but also should allow the members to adopt 
the necessary measures to reserve the resources and protect the environment. China will assess the WTO DSB ruling and conduct scientific ad ministration on the resources products. 
Question 
The determination of government prices or govern ment-guided prices varies in accordance with 
the type of products or services, based on criteria  such as market situation, average social costs, 
the effect on the standard of living of the population, as well as on economic, regional and 
seasonal factors. What is the relative weight of each of the stated criteria while using the 
methodology for setting prices?  
Answer 
Please refer to the Article 21 of the Price Law. In practice, the factors affecting the price are 
various depending on different type of goods and se rvices, therefore, considerable factors shall be 
taken into consideration when setting the prices.  
Question 
47 tariff lines are subject to tariff rate quotas (section 4.1), including in HS Chapters 10 (wheat and maslin, maize, rice), 11 (cereal flours other than of wheat and maslin, cereal groats), 17 (cane or beet sugar), 31 (mineral or chemical fertilizers), 51 (wool, carded or combed), and 52 (cotton). 
The Secretariat Report explains that historically, the fill rate of TRQs has been low. In such case, 
what is the rationale for maintaining these quotas?  
Answer 
The basic consideration for China to maintain these quotas is to keep up with its commitments 
during the WTO accession. After tariff rate quotas of Chinese agricultural products are distributed to enterprises, enterprises may freely import agri cultural products without intervention by the 
Chinese Government. The fulfil rate of TRQs for cotton was 100%. China has always adhered to 
basic food self-support and has witnessed continuo us food production increase and sufficient food 
supply over the past decade. 
Question 
China continues to use a broad range of measures including tariff protection, import and export 
licensing, state trading for certain products, export and import quotas, export tax rebates, minimum support prices for basic crops, support to promote the use of inputs, direct payments, 
and buffer stock for food security. However, labour productivity in agriculture continues to be 
lower than in the rest of the economy; this can be attributed to the small scale of production, structure imbalance and a lack of skilled farmers and modernization. The Secretariat Report also 
notes that there have been no major changes in the policy instruments that China uses to attain 
its policy goals. What are China's views?  WT/TPR/M/300/Add.1 
 
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 Answer 
China has taken measures to administrate its do mestic economy that are consistent with WTO 
rules. Labour productivity in agriculture is low because China is still a developing country. China 
plans to continue to deepen its reform and op ening-up and promote the development of various 
industries while maintain stable macroeconomic policies.  
Question 
How many anti-trust actions under the competition law have involved SOEs? 
Answer 
To date, many monopoly cases under investigation by industry and commerce authorities have 
involved SOEs and relevant cases are being investigated. We will publish these cases on the 
website of the State Administration of Industry  and Commerce after the investigation. Please 
check the information provided on the relevant websites.  WT/TPR/M/300/Add.1 
 
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 2  QUESTIONS BY SINGAPORE 
PART I: QUESTIONS REGARDING THE SECRETARIAT REPORT 
 
2. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
Reciprocal Agreements  
Page 40 (Para 2.36) 
 
Question 1 
We understand that in some of China's FTA agreements, China requested for a Certificate of Non-
Manipulation to be issued for the originating goods transiting through a non- party/third country if the goods are intended for export to China under  preferential rates. We would like to know 
whether China will be reviewing these requirements with the aim of facilitating trade by accepting 
other supporting shipping documents (such as a through bill of lading issued in the exporting Party, which will already validate that the goods are a direct consignment from the exporting Party 
to the importing Party, without any consigning to an intermediate party which may manipulate the 
item in any way) in lieu of this Certificate of Non-Manipulation issued by the authorities in the country of transit. 
 
Answer  
To date, China has requested for customs certificat es issued by country of transit for imported 
goods under FTA agreements in a bid to ensure relevant goods conform to direct shipment clauses 
provided in FTA agreements. China has no plan to adjust this policy.   Examination and Approval Procedures 
 
Pages 45-46 (Para 2.56)  
Question 2 
Singapore appreciates China's effort in opening up market access to encourage FDI in China. Regarding verification of investment projects, th e Secretariat reported that "in general foreign-
invested projects are subject to the same requirements as domestic investment projects". We wish 
to seek greater clarity on the requirements where foreign invested projects are different from domestic investment projects. 
 
Answer 
The Chinese Government has requested to implement unified market access system as well as 
laws and regulations on foreign-invested projects  and domestic investment projects. In December 
2013, the State Council issued the Circular of the State Council on Releasing the Catalogue of Investment Projects Subject to Approval by th e Government (2013) to stipulate the scope of 
foreign-invested projects to be approved. In May 2014, the National Development and Reform 
Commission (NDRC) issued the Administrative Measures for Approval and Registration of Foreign-
invested Projects to further enhance the linkage with the amendment to the Interim Measures for Approval of Enterprise Investment Projects wh ich applies to domestic enterprises invested 
projects, with basically same requirements on advance documents, conditions and procedures of 
project approval. Meanwhile, to embody specific requirements on approval and registration of 
foreign-invested projects, approval conditions for foreign-invested projects are defined, including 
compliance with relevant national laws and re gulations, foreign investment access policy and 
capital account management.  Incentives to Foreign Investment 
 
Page 50 (Para 2.74)  
Question 3 
On incentives to foreign investments in the central-western region of China, we would appreciate clarification on the following: 
 
(a)  What are the tax incentives that are unique to this region? WT/TPR/M/300/Add.1 
 
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 Answer  
During 2001-2010, China levied enterprise income tax by a reduced rate of 15% on domestic-
funded and foreign-invested enterprises in the in dustries encouraged by the State in the western 
region. All enterprises meeting tax conditions enjoyed this incentive policy. See Item 14 of 
G/SCM/N/155/CHN and G/SCM/N/186/CHN for details. In 2011, to further support the development of western regions, China extended th e policy to the end of 2020. In other words, 
China levies enterprise income tax by a rate of 15% on enterprises in industries encouraged in the 
western region from 1 January 2011 to 31 December 2020. China will update corresponding information in next Subsidy Notification.  
(b) What is the operating mechanism for and benefits of the "special customs 
supervision zones or bonded supervision areas" in region?  
 
Answer 
Bonded areas, export processing zones and comprehensive bonded zones are special customs 
supervision zones and are set up subject to the approval of the State Council under the 
administration of the General Administration of Customs (GAC). Pursuant to the Guiding Opinions 
of the State Council on Promoting the Scientific Development of Special Customs Supervision Zones (Guo Fa [2012] No.58), special customs supervision zones shall be set up by following the principles of contributing to the implementation of the national strategic plan or regional 
development, undertaking of industry transfer in the western region, integration and optimisation 
of special customs supervision zones and the esta blishment of imperative export-oriented large-
scale projects pursuant to the provisions and requirements set forth in the Measures for the 
Establishment and Approval of Special Customs Supervision Zones. 
Special customs supervision zones have played a positive role in undertaking international industry transfer, facilitating processing trade transforma tion and upgrading, expanding foreign trade and 
promoting employment. In particular, regarding processing trade transformation and upgrading, 
China can give a full play to regional influence function of special customs supervision zones, 
develop outside-region industrial support capacity, drive eligible enterprise to enter the industry 
chain and supply chain of processing trade, facilitat e in-depth integration of production processing, 
logistics and service industries inside and outsid e the region and form a pattern characterised by 
high-end zone access, supporting neighbouring facilities, regional influence and aggregation development. 
All bonded supervision zones are under management  subject to unified national laws, regulations 
and rules. To date, there are establishment and ap proval policies biased at central-western region 
where establishment conditions are less rigorous than those in the eastern region. Pursuant to the 
Measures of the General Administration of Customs,  Ministry of Finance, State Administration of 
Taxation and State Administration of Foreign Exchange for the Examination and Approval of Bonded Logistics Centres (Shu Jia Fa Zi [2013] No.124), bonded logistics centres shall be set up by following the principles of contributing to th e implementation of national strategic plan for 
regional development, acceleration of processing trade transformation and upgrading and 
facilitation of industry transfer in the central-western region.  
(c) How are these incentives structured such that they are consistent with the WTO 
Subsidies and Countervailing Measures (SCM) agreement? 
 
Answer 
China has been working hard on preparing the next subsidy notification since the last trade policy 
review, will analyzing the consistency with the WTO Subsidies rules in the regards in the next subsidy notification. 
 
China (Shanghai) Pilot Free Trade Zone   
Page 51 (Para 2.81)  
 Question 4 
4. We understand that pre-establishment MFN trea tment to FIEs in the CSPFTZ is only granted 
on a trial basis. Can China elaborate on the crit eria and duration of the pre-establishment MFN 
treatment trial? Will China consider implementing National Treatment in CSPFTZ in the future?  WT/TPR/M/300/Add.1 
 
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 Answer 
Pursuant to the Overall Scheme of the China (S hanghai) Pilot Free Trade Zone, the CSPFTZ will  
explore and establish negative list management mode, draw ideas from international prevailing 
rules, grant pre-establishment MFN treatment trial to foreign investors, and study and develop the 
negative list for differences in foreign investme nt and national treatment outside the CSPFTZ. 
Regarding zones outside the negative list, the approv al system of foreign-invested projects will be 
changed into registration system by following th e principle of no difference between domestic and 
foreign investments and contract constitution a pproval for foreign-invested enterprises will be 
changed into registration management. To this end, the Standing Committee of the National People's Congress has authorized the State Council to temporarily adjust relevant administrative 
examinations and approvals provided in the Law of the People's Republic of China on Foreign-
capital Enterprises and the Law of the People's Re public of China on Chinese-Foreign Equity Joint 
Ventures within three years on a trial basis. 
 
Question 5 We would like to seek clarity on whether there will be further clearance of goods when they enter 
or exit the CSPFTZ after the first tier opening, as well as what further trade facilitation measures 
are envisaged to be implemented in the second tier opening.  
 Answer 
According to the requirements to advance the impl ementation of first tier opening and resolutely 
implement second tier safe and high-efficiency ad ministration provided in the Overall Scheme of 
the China (Shanghai) Pilot Free Trade Zone, Customs, inspection and quarantine and other 
regulators successively promulgated many trade facilitation measures: 
Facilitation measures promulgated by Customs:  First tier opening policies:  
1. Innovative development of "zone access first and then customs declaration" system. Original 
customs clearance operation process of "customs declaration first and then zone access" for first tier imported goods is adjusted, and enterprises are allowed to pick up the goods and enter the 
zone by goods manifest information and then go through customs declaration formalities within a 
given time limit to reduce customs clearance time and cost.  
2. Simplifying documents attached to customs clearance operation. Shanghai Customs and Shanghai Entry-Exit Inspection and Quarantine Bureau decided to cancel check on customs 
clearance form in the first tier importing. Attached documents are cancelled for first tier entry and 
exit customs files and second tier tax-free import  and export customs declarations and enterprises 
will be required to provide relevant attach ed documents and files when necessary.  
3. Unified registration list. Two different registration list formats for different special customs 
supervision zones in the CSPFTZ are translated in to 30 declaration elements to realize standard 
and simple declaration, reduce burdens on ente rprises and promote integrated operation in the 
CSPFTZ.  
Second tier opening policies:  
1. Batch entry and exit and centralised declaration system. Traditional "one declaration for one bill" is changed into "one declaration for multiple bills" and enterprises are allowed to import and 
export goods by batch and intensively go through customs declaration formalities within a given 
time limit to expand enterprises' decision-making power in declaration, lower customs clearance cost and improve customs clearance efficiency. 
2. Selective taxation system for domestic sale. Enterprises may choose to pay import tariffs for 
goods that are produced, processed and sold to the domestic market via the second tier in the CSPFTZ, which will attract more enterprises to enter the CSPFTZ and helps enterprises expand 
domestic sale.  
3. Intensive summary tax payment system. Traditional customs-dominated tax collection and 
administration model is changed into enterprise initiative tax collection and administration model. With valid guarantee, enterprises are allowed to pa y taxes of several batches of goods released to 
customers within a given tax cycle and customs changes its real-time check into follow-up check 
and tax audit to simply tax collection and admini stration formalities, improve customs clearance 
efficiency and lower enterprise costs.  
Other facilitation measures: 
1. Self-transportation system in the CSPFTZ. Qual ified enterprises in the CSPFTZ are allowed not 
to use customs supervision vehicles and implement self-transportation in the four special customs supervision zones in the CSPFTZ by comparing info rmation system data to lower logistics costs. WT/TPR/M/300/Add.1 
 
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 2. Processing trade order write-off system. The networked management implemented for 
processing and manufacturing enterprises using ER P is leveraged to cancel unit-consumption audit 
and registration and write off based on daily work order data automatically sent by enterprises. As  
a result, customs supervision model will fully respect production law of enterprises to raise 
enthusiasm among enterprises for optimising production process and provide references and samples for supervision on new business forms including R&D and maintenance.  
3. Bonded exhibition transaction system. Qualified enterprises in the CSPFTZ are allowed to make 
bonded exhibition transactions in and outside th e CSPFTZ after providing to customs sufficient tax 
payment guarantee (cash deposit or bank guarantee) and implement sale first and then tax payment and intensive declaration for goods sold in the domestic market during exhibition. This 
has been implemented in the CSPFTZ.  
4. Domestic and overseas maintenance system. Qua lified enterprises in the CSPFTZ are allowed to 
launch high-tech, high value-added and pollution-free domestic and overseas maintenance 
business. Customs refers to bonded processing supervision model to implement management 
based on IT system to drive extensions to both sides of high value-added production chain of R&D, test and maintenance and promote processing trade transformation and upgrading.  
5. Futures bonded delivery system. Enterprises in the CSPFTZ are allowed to make physical futures 
delivery targeting at goods under bonded supervis ion in the CSPFTZ. The implementation area is 
expanded from Yangshan Boded Port to entire CSPFTZ, and delivery of goods is expanded from copper and aluminium to all commodity varieties listed on the Shanghai Futures Exchange.  
6. Financing lease system. Customs levy tariffs and added-value tax on financing lease goods 
based on rent installment determined in examinat ion. Meanwhile, qualified enterprises are allowed 
to provide guarantee in the form of warranty to lower enterprise costs and further attract financing 
enterprises to the CSPFTZ. The implementation area is expanded from Pudong Airport 
Comprehensive Bonded Zone to entire CSPFTZ.  7. Bonded logistics networked supervision system. Traditional existing models such as 
warehousing registration, stocktaking and writing-off are reformed to implement the management 
model of "system networking + warehouse locati on management + real-time writing-off" for 
enterprises adopting WMS and make real-time an d dynamic management of goods entry, exit, 
transfer and inventory to improve logistics operation efficiency.  
8. Intelligent customs pass management system. Pa ss facilities in the CSPFTZ are upgraded and 
transformed and pass operations are simplified to realize automatic comparison, automatic identification and automatic passage, shorten vehicle pass time, improve customs clearance 
efficiency and satisfy safety and high efficiency requirements.  
 Page 52 (Para 2.84)  
 
Question 6 It was mentioned that the Negative List would be adjusted when deemed appropriate, and the revised version was expected to be released in the first half of 2014. We would like to enquire 
about the progress of the revised list.  
 Answer 
Shanghai is revising the Special Management Measures for Foreign Investments in the China (Shanghai) Pilot Free Trade Zone (Negative List) (2003) following the principles of raising openness, improving transparency and further gearing to international general rules.  
 
Customs Procedures and Requirements  Page 55 (Para 3.2) 
 
Question 7 We note from the footnote that the paperless cu stoms clearance pilot project was introduced in 
August 2012. We would like to enquire on the progress of the pilot project and when it would be 
fully implemented.   WT/TPR/M/300/Add.1 
 
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 Answer 
Paperless customs clearance requires enterprises to submit electronic data of relevant bills to the 
customs when going through import and export customs clearance formalities instead of handing 
in paper bills on the site. Since 1 August 2012, some customs have launched the paperless 
customs clearance pilot project. Based on pilot experience in the early stage, the GAC decided to expand paperless customs clearance reform measures and scope of the pilot project to all business 
sites and business fields nationwide as of 1 April 2014 to gradually realize nationwide coverage of 
the paperless customs clearance reform.   Page 57 (Para 3.6)  
 
Question 8 
We would like to enquire on the number of "approved piloted enterprises graded B or higher" and 
on the number of these that choose to do paperless customs declarations.  
 
Answer 
As of 31 May 2014, 623,189 enterprises were registered at Chinese customs, including 3,041 
enterprises Grade AA, 34,573 Grade A and 583,939 Grade B. There were 621,553 approved 
piloted enterprises graded B or higher.  
 
Pursuant to the Announcement of the General Administration of Customs on Deepening the Paperless Customs Clearance Reform (Announcement [2014] No.25), Chinese customs have 
expanded the paperless customs clearance to all enterprises at all ports without restrictions on management category. According to statistics, 230,000 enterprises participated in paperless 
customs clearance in the first quarter of 2014.  
 Standards and Other Technical Requirements 
 
Page 74 (Para 3.69)  
 Question 9 
We note that China uses four kinds of standards – national, industry/sectoral, local and enterprise 
to address various needs where relevant. At each of these levels, there are substantial numbers of 
separate mandatory standards. In this regard, we wish to seek greater clarity on China's current 
and future efforts to streamline and review th e domestic standards framework, and look into 
replacing local standards with national standards where relevant.  
Answer 
China's mandatory national, industrial and local standards are developed and released by 
competent national, industry and local standardiz ation authorities. To promote the establishment 
of uniform market, we are actively facilitating integration and optimization of mandatory national, 
industrial and local standards to reduce the number of the standards. 
 Page 75 (Para 3.75) 
 
Question 10 We note that there are general steps in the Chin a's Compulsory Certificat es (CCC) certification 
application process.  
 
(a) For step (ii), type-testing by a CNCA-designated testing laboratory is required. Is there a 
list of such CNCA-designated testing laboratories?  
 
Answer 
Please refer to the Announcement of the Certification and Accreditation Administration of the 
People's Republic of China on the List and Busi ness Scope of CNCA-designated Testing Agencies 
and Laboratories for CCC Certification for the list of testing laboratories on the http://www.cnca.gov.cn/tzgg/ggxx/gg xx2013/201306/t2013060 4_5889.shtml.  
 WT/TPR/M/300/Add.1 
 
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 (b) For step (iii), initial factory inspection is ne cessary in applying for the CCC certification. Are 
overseas manufacturing facilities subject to similar factory inspection requirements? We would also like to seek clarification if China is keen to explore mutual recognition 
arrangements for such factory inspection results. 
 Answer 
Overseas manufacturing facilities are also subject to similar factory inspection requirements with domestic enterprises. China needs to bilaterally ne gotiate with specific countries to explore mutual 
recognition arrangements.   
Export Taxes, Charges, Levies  
 Page 81 (Para 3.94) 
 
Question11 We note that China may restrict or forbid the exportation of any product due to certain reasons. 
We would appreciate it if China could direct us to the resources where information on these 
restrictions and prohibitions can be found.  
 Answer 
Please locate in the official website of MOFCOM, GAC and AQSIQ which published the Announcement of Export/Import prohibition.   
Measures Affecting Production  and Trade – Incentives  
 Page 88 (Para 3.121)  
 
Question 12 Could China elaborate on how th e responsibility for formulating, proposing and approving the 
implementation of new incentive schemes is divided between the central government and the 
provincial and municipal governments?  
 
Answer 
The bodies of the Chinese Government feature a line function structure and are divided into 
central, provincial, municipal, county and town levels. In regard to the implementation of policies 
expanding domestic demand, China must guaran tee a unified national macroeconomic policy 
framework. The central government develops the goals and policies of national economic 
development, general price level regulation and major economic structure optimisation, formulates macro-control policies including fiscal, monetary and land policies and plans. In terms of significant 
construction projects and productivity layout, relevant functional departments of the central 
government take charge of specific examination and approval of the projects and arrange central 
investments involving significant construction projects. Provincial and municipal governments 
propose the objectives of local economic develo pment, price regulation and economic structure 
optimisation, implement relevant fiscal, monetary and land policies formulated by the central government, organise early preparations of significant construction projects and file an application 
for project approval to the central government and arrange partial local construction project 
investments according to administration authority.  According to general requirements on institutional reform and functional transformation of the State Council, the central government will further deepen reform on administrative approval 
system, reduce administration of micro affairs, give  full play to the decisive role played by market 
in resource allocation and give better play to government role, lay emphasis on arousing enthusiasm of central and local governments, focus on functional transformation and continue to 
streamline administration and delegate power to the lower levels, advance institutional reform, 
improve systems and mechanisms and improve administration efficiency.  WT/TPR/M/300/Add.1 
 
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 Question 13 
In general, are provincial and municipal governments able to offer their own tax incentives and grants to businesses without the knowledge and approval of the central government?  
 
a.  Are provincial and municipal level government incentives and grants committed under 
WTO? 
b.   Could China share more information on all these provincial and municipal level government 
incentives and grants available please? In the ca se that there is no such consolidated list, 
we would appreciate if you could provide us with some sources of information. 
Answer 
According to existing tax administration system, the legislative authority of tax policies is mainly  
controlled by the central government and local governments have no authority to formulate and promulgate tax reduction and exemption policies. As  explicitly provided in the Circular of the 
Ministry of Finance and the State Administration of Taxation on Resolutely Curbing Unauthorized 
Tax Reduction or Exemption and Strengthening Taxation Governance in Line with Law (Cai Shui [2009] No.1), fiscal and tax departments at all levels shall strictly implement unified tax 
preferential policies formulated by the State and shall not change, adjust or accommodate to 
circumstances national tax laws and tax policies be yond their authorized administration authority. 
In addition, according to the deployment of "sorti ng and standardising tax preferential policies" at 
the Third Plenary Session of the Eighteenth CPC National Congress, departments concerned will 
intensify effort in investigating and punishing unauthorized tax reduction or exemption.  
 Competition Policy and Price Controls  
 
Page 93-94 (Para 3.136)  
Question 14 
We note that China has begun implementing the provisions regarding competition policy adopted in the course of the previous Review, and that on e of these laws is the Anti-Monopoly Law (AML). 
Although the AML covers all types of enterprises,  Article 7 of the AML allows the exercise of 
exclusive activities of state-owned enterprises (S OEs) that are considered vital to the Chinese 
economy and to safeguard national security or that  have been granted legally exclusive production 
and sales rights. Could we clarify with China what these SOEs considered vital to the Chinese 
economy are, and the considerations in classifying them as such? We would also appreciate if 
China could share what the exceptions made for these SOEs under Article 7 of the AML are, and 
how China fosters a level playing field between these SOEs and other private companies operating 
in the Chinese market. 
 Answer 
The AML equally applies to market players of al l types. Any enterprise, whether it be a SOE, 
private enterprise or foreign-funded enterprise will be investigated and punished as long as it 
engages in an action prohibited by the law. At  present, many cases under the investigation of 
industry and commerce authorities involve SOEs in power supply, tobacco and other industries.  
 
Despite of Article 7 of the AML providing that with respect to the industries controlled by the State-
owned economy and concerning the lifeline of national economy and national security or the industries lawfully enjoying exclusive production  and sales, the State shall protect these lawful 
business operations conducted by the business oper ators therein, Paragraph 2 under Article 7 of 
the AML also stipulates that the business operators mentioned in the previous paragraph shall operate according to law, be honest, faithful and strictly self-disciplined, and accept public 
supervision, and shall not harm the consumer inte rests by taking advantage of their controlling or 
exclusive dealing position. Therefore, such busi ness operators shall also abide by the AML and 
shall not commit monopolistic behaviours such as monopoly agreement and abuse of market 
dominance; otherwise they shall be investigated and punished by anti-monopoly law enforcement 
agencies in accordance with law. Law enforcement practices by relevant departments in recent years have fully proven that the AML equally trea ts enterprises of all ownerships without special 
protection.  
 WT/TPR/M/300/Add.1 
 
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 Transport Services 
 Pages 155-156 (Para 4.117) 
 
Question 15 We note China's reform of tonnage dues. It was in dicated that preferential rates are applicable to 
Chinese vessels and vessels of flag States that have reciprocal most-favoured-nation 
arrangements with China with regard to taxes and dues levied on vessels. We would like to seek clarification on whether preferential rates are the same for both classes of vessels, or if Chinese-flagged vessels would be subject to the most prefer ential rates followed by vessels of flag States 
that have entered into treaties or agreements with China that include reciprocal most-favoured-
nation treatment. We would also like to understand what is meant by "most-favoured-nation treatment on a reciprocal basis".  
Answer 
Pursuant to Article 3 of the Interim Regulation s of the People's Republic of China on Vessel 
Tonnage Dues, preferential rates shall be applicable to taxable vessels of Chinese nationality and  
taxable vessels the flag states (regions) of which have entered into treaties or agreements that contain clauses offering most favoured nation treatment to each other's taxes and dues levied on 
vessels with the People's Republic of China. Ther e is no preferential rate applicable to Chinese 
vessels.  
 
Most-favoured-nation treatment on a reciprocal basis" means vessels of flag States that have entered into treaties or agreements with China that include reciprocal equal treatments with 
vessels of other WTO Members. 
 
Pages 156 (Para 4.121)  
Question 16 
We note that the report mentions that China intends to establish an international ship registration system. We would like to seek clarity on what th e international ship registration system is and 
what it entails. 
 
Answer 
In 2013, the Ministry of Transport replied by lette r to the Tianjin Municipal People's Government 
and the Shanghai Municipal People's Government to allow them to implement the international 
ship registration system on a pilot basis in the Tianjin Dongjiang Bonded Zone and the China 
(Shanghai) Pilot Free Trade Zone. The approved international ship registration system features 
breakthroughs and innovations in foreign contribution determination of registration body, appointment, examination and approval of foreig n crew and age of foreign import and bareboat 
charter foreign ships and vessels.  
 
PART II: QUESTIONS REGARDING THE GOVERNMENT REPORT 
 
Improving Trade Facilitation  
 
Page 19-20 (Para 3.30) 
 Question 17 We would like to understand the difference between the two clearance models "declaration and 
release in registered custom" and "declaration in registered custom and release at port"? 
Regardless of the clearance model, we would also  like to understand whether the risk assessment 
is conducted at national level via a centralised system with a set of harmonised risk criteria or at 
the regional level via the district customs system where specific risk criteria apply.  
 
Answer 
"Declaration in registered custom and release at port" means enterprises meeting the Chinese 
customs requirements may independently choose to make declaration in registered customs and go through goods release formalities at the actual goods entry and exits port (hereinafter referred 
to as "port customs" when they are importing or exporting goods. "Declaration and release in WT/TPR/M/300/Add.1 
 
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 registered custom" is not applicable to imported and exported goods that shall go through port 
custom declaration and release formalities subjec t to Chinese customs provisions or national 
license administration. "Declaration in registered custom and release at port" is one way of 
"declaration in registered custom and release at  port" and means enterprises meeting the Chinese 
customs requirements may independently choose to make declaration and go through goods release formalities in registered customs. "Declaration in registered custom and release at port" is 
not applicable to imported and exported goods to  be examined, imported and exported goods that 
shall go through port custom declaration and release formalities subject to Chinese customs provisions or national license administration and imported and exported goods for which port custom fail to realize electronic data transmission of export shipment and delivery report and 
import tally report. The above so-called "license " does not include "customs clearance form of 
entry (exit) goods". Chinese customs have implemented both risk criteria applicable to all customs nationwide (primary 
risk parameters and primary risk control instructions) and regional risk criteria applicable at direct 
custom level (secondary risk parameters and secondary risk control instructions). All these parameters and instructions are loaded and released in the customs clearance system. In the two 
clearance models, declaration entering the customs clearance system will receive the risk 
identification of primary risk control instructions and primary risk parameters and then the risk identification of secondary risk parameters and risk  control instructions issued by direct customs. WT/TPR/M/300/Add.1 
 
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 ADDITIONAL QUESTIONS BY SINGAPORE 
PART I: QUESTIONS REGARDING THE SECRETARIAT REPORT 
 
TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
 
Standards and other technical requirement 
 Pages 74-76 (Section 3.1.8)  
Question 1 
China has been recognized as an important source of Active Pharmaceutical Ingredients (APIs) that feed into the global pharmaceutical market. We wish to seek greater clarity on China's current 
and future efforts to strengthen the pharmaceutical sector to ensure safety and quality of both 
APIs and pharmaceutical prod ucts exported from PRC.  
 
Answer 
We are in the process of coordinating domestic agencies involved to generate proper details on 
this issue.  
Trade Policies by Sectors 
 Pages 149 - 150 (Boxes 4.9 and 4.10)  
 
Question 2 We welcome the recent measures taken by China to further liberalise construction services within 
the Shanghai Pilot Free Trade Zone (SHFTZ). Could China elaborate on whether all foreign 
construction companies that have been pre-assigned the appropriate grading would be allowed to operate in the SHFTZ, or only those graded as su per would be allowed? Could China also share the 
criteria used to assess the grading for construction companies? 
 
Answer 
According to the Notice on Issues Related to Setting up Foreign Investment Construction and 
Engineering Enterprises within the Shanghai Pilot Free Trade Zone, foreign investment 
construction and engineering design enterprises or  foreign investment construction enterprises in 
the pilot zone shall apply for qualification license for construction and engineering enterprises, and 
they shall proceed by following the Standards for the Qualifications of Construction Enterprises, 
the Regulations on the Qualifications of Construction Engineering Prospect, the Regulation on Foreign-Invested Construction Engineering and De sign Enterprise and the Regulation on Foreign-
Invested Construction Enterprises. Among these, for foreign-invested construction engineering and 
design enterprise that provides design service fo r Shanghai, its engineering design record will not 
be evaluated when it first applies for construction engineering and design qualification.  
PART II: QUESTIONS REGARDING THE GOVERNMENT REPORT 
 Other Reform Measures 
 
Page 14 (Para 2.54)  Question 3 
We note that China is consolidating a national system of essential drugs, and the mechanism for 
its functioning at grassroots levels. It was mentioned at the last review the essential drug system has covered over 80% of village clinics. The National Essential Drug List (NEDL), which was 
announced in March 2013, requires government-run medical facilities (up to level 2 and 3 
hospitals) to give preference to the drugs on the NEDL and adhere to the national price caps. However, we understand that most of the hosp itals and clinics operate on a fee-for-service 
system, i.e. fee-generated revenues for providin g additional medical services and medicine. As 
such, we would appreciate if China could share details on initiatives to regulate healthcare providers (i.e. doctors and hospitals) to safeguard against risks of over-prescribing and/or over-charging of medicines on the NEDL. WT/TPR/M/300/Add.1 
 
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 Answer 
Measures to avoid over-prescription cover the following: 
 
(I) Improve policies and regulation. The former Ministry of Health release the Regulations on Drug 
Affairs in Healthcare Institutions, the Regulations on Prescriptions, the Regulations on the Clinical 
Use of Anti-bacteria Drug, and Regulations on Narcotic Drugs and First Class of Psychotropic Drugs 
in Healthcare Institutions to guide these institutions to enhance drug management and standardize 
clinical drug use.   (II) Release sound technical documents to guide clinical drug use. The former Ministry of Health 
drafted the Guidance on Clinical Diagnosis and Tr eatment and technical documents on the clinical 
path of major diseases (including drug selection and use). The former Ministry of Health and the National Health and Family Planning Commission drafted the Guiding Principle for Clinical Use of 
Anti-bacteria Drug, the Guidance on Using Anti -microbial Agent for Treatment, the Guiding 
Principle for Clinical Use of Glucocorticoid Drug, the Guiding Principle on Clinical Use of Narcotic Drug, the Guiding Principle on Clinical Use of Psychotropic Drugs, the National Prescription 
Dispensatory (Volume on Chemical Drug and Bio-product) and technical documents for children. 
These documents clarify the principle of drug use and specific drug treatment solution. Doctors are 
required to follow these regulations in prescribing drugs.   
(III) Take taskforce to standardize drug use. The he former Ministry of Health and the National 
Health and Family Planning Commission carry out patient-oriented campaigns to improve healthcare service quality, such as year of hospital management, healthcare quality promotion, 
and special taskforce on clinical use of anti-bacteria drug. These activities aim at setting standard 
and conducting inspection and evaluation to promote sound drug use.   
Question 4 
Given that NEDL is only adopted up to level 2 and 3 hospitals in the 2013 review, there is a significant proportion of healthcare institutions (level 4 and 5 hospitals) which can charge different rates for the same medication within the same provinces and cities. We are interested to know if 
there are plans to minimise price variations for the same drug for better price predictability. 
 Answer 
In March 2013, the NEDL 2012 version is officially released, with a coverage of 520 drugs. It is applicable to all levels of healthcare institutions. At presents, the essential drug system is initially set up in China, covering all government-funded gr ass-root healthcare institutions. Essential drugs 
are procured at provincial level and sold withou t added profit. The pricing authority in China is 
promoting drug reform, drafting regulations and improving policy. Currently, some basic procedures are already in place, such as cost pr ice survey, expert evaluation and argumentation, 
opinion consultation, and group review. The Regulations on Drug Price Difference is released, drug 
factory price survey and online monitoring system are set up, drug information management 
system is improved and the scientific nature and transparency of drug pricing are greatly 
enhanced. In order to further highlight drug value in the price management, we are now working 
on improving drug pricing methodology, expl oring to use drug economics assessment and 
international drug comparison in pricing, and studying supporting policy incentives to encourage drug R&D and innovation and quality upgrade. 
 
Question 5 We note the establishment of social security mechanisms against major and critical diseases and also assistance mechanisms for medical care. We are also aware of China's plans to provide free 
"wellness" services including immunization, he alth screening, disease prevention and health 
promotion activities to the whole population as a key strategy to basic healthcare. We are interested to find out more about the essential healthcare delivery system (EHC) in both the rural 
and urban areas for such "wellness services". What are the experiences and challenges 
encountered thus far, particularly in the more vulnerable demographic sectors of senior citizens, children and pregnant mothers?  
 WT/TPR/M/300/Add.1 
 
- 17 - 
 
  
 Answer 
(I) Insurance against major disease in the new rural cooperatives 
 
In order to further reduce the economic burden on rural people and solve the problem of disease-
caused poverty and poverty due to illness. In 2010, the Chinese Government launched medical insurance against major disease for rural people. The main approach is to raise the reimbursement 
rate to 70% for major disease, in addition to clin ical path and cost limitation. Medical assistance 
will compensate another 20% for eligible patients. In 2013, the insurance against 20 major diseases including children leukemia, congenital heart disease and end-stage renal disease is being carried out at provincial level across China. Effort is also being made to include children 
phenylketonuria and hypospadia as pilot. 
 On the basis of developing medical insurance against major diseases in new rural cooperatives, 
and the Guidance on Developing Medical Insurance against Major Disease for Urban and Rural 
People (FGSH [2012] No. 2605) jointly released by NDRC with 5 other ministries, we actively guide local authorities since 2012 to explore approach to utilizing new rural co-operative funding for 
purchasing major disease insurance from commercial insurance companies. Major disease 
insurance provides cost-based compensation. It grants reimbursement at certain percentage based on patient's self-payment, which is done after the reimbursement under the basic medical insurance system. Currently, there are 9 insura nce companies carrying out pilot project of 
commercial insurance against major diseases in 941 regions in China, covering 292 million people. 
1.23 million persons have received compensation so far, with total compensation of 3.5 billion RMB. 
 
(II) Participation of migrant workers in new rural cooperatives  
Since the implementation of new rural cooperativ es, we follow the principle of being convenient, 
beneficial and favorable to people, and continuously promote and consolidate new rural cooperatives. In order to make the rural migrant population have access to medical insurance, in December 2009, the MOHRSS, the former MOH and MOF jointly released the Interim Regulations 
on Transfer and Continuation of Basic Medical Insurance for Migrant Workers (MOHRSS [2009] No. 
191), specifying that urban and rural migrant workers shall follow the existing regulations to participate in either basic medical insurance for urban employees, or basic medical insurance for 
urban residents or new rural cooperatives. No simultaneous participation and repetitive treatment 
is allowed. The employer shall follow the Interim Regulation on Social Security Registration to register the employee who has rural household registration but works in urban area and keeps 
stable work relation, so that he/she can have access to basic medical insurance for urban 
employees; for other migrant worker, he/she may choose either new rural cooperatives at their household registration location or basic medical insurance at their workplace on a voluntary basis. He/she shall follow related regulations to finish registration procedure at their local agencies of 
new rural cooperatives or medical insurance office at their workplace. These policies ensure that 
rural workers can have access to basic medical insurance regardless of their job change.   
Meanwhile, in order to ensure the benefit of ru ral population, the new rural cooperatives make 
great effort in information development and instant settlement and reimbursement since the pilot phase. In 2013, 90% of the regions in China ha ve realized instant settlement and reimbursement 
from the new rural cooperatives to provincial he althcare institutions. Meanwhile, different regions 
also work on instant settlement and reimbursemen t of cross-province hospital visit. Anhui and 
Sichuan province also set up designated hosp itals in Beijing and Shanghai, where Anhui and 
Sichuan local migrant workers concentrate, so as to facilitate their reimbursement in different 
regions.  
 Since 2011, NHFPC has been working to develop national information platform for new rural 
cooperatives. Currently, the platform has pilo t connection with certain provinces and large 
healthcare institutions. In 2014, we will accelerate the work and try to connect the platform with half of provincial platforms. Based on that, we will pilot the work of cross-province medical cost 
verification and settlement reimbursement, so as to further facilitate rural population in hospital 
visit and reimbursement at different places.  Since 2009, the Chinese Government launched nation al public health service project. The urban 
and rural grass-root healthcare institutions provide free care service for residents within the WT/TPR/M/300/Add.1 
 
- 18 - 
 
  
 community. Currently, the project has been expanded  to cover 11 items, including health record, 
health education, vaccination and inoculation, he alth management for kids of 0-6 years, health 
management for pregnant woman, health manageme nt for seniors, health management for patient 
with chronic disease, management of severe psychological disease, report and handling for 
infectious disease and public health incident, health regulation and supervision, health management of traditional Chinese medicine.  
 
With the project in place, the basic public health service for urban and rural residents is further improved and reached equal level. The achievement is reflected in the following area: first, preventive priority as the principle of health work is further improved; second, project 
management and service level is continuously enhanced; service quantity and content is 
increasing steadily, and residents are enjoying increased benefit; forth, new operating mechanism for grass-root healthcare institution is established. The difficulty and challenge for the time being 
are as follow: first, project implementation ne eds to be further improved and standardized; 
second, there is prominent problem of insufficien t grass-root service capacity; third, effective 
incentive needs to be further improved.  
 
Question 6 We note the acceleration of Chinese reforms of the basic medical insurance systems for the whole population. We understand from China's previous TPR that coverage of the three basic insurance 
schemes (including non-working urban residents, urban workers and rural residents) has stabilised 
at 95%. Nonetheless, we are aware that of the floa ting migrant worker population in Chinese cities 
who are not covered by the Urban Resident Ba sic Medical Insurance (URBMI), Urban Employee 
Basic Medical Insurance (UEBMI) or the New Cooperative Medical Scheme (NCMS), as they come 
either from the rural areas or across another provin ce. With greater social mobility, there is a need 
to make the schemes more flexible and portable across regions and provinces so that workers can 
continue to be covered no matter where they move. We would like to find out the general direction 
and plans for the provision of national health insurance leading up to the target achievement of universal health care in 2020.   
Answer 
Currently, China has generally realized medical insurance for all population. All urban and rural 
residents, including urban migrant workers, are in cluded in the basic medical insurance coverage 
and are entitled to basic healthcare treatment. Th e basic medical insurance pays great attention to 
the rights and interests of migrant workers, and works out related documents. According to these 
regulations, rural workers with stable work relation shall participate in basic medical insurance for 
employees in their companies; migrant population with no fixed-work relation may choose to 
participate medical insurance for urban residents at their living place or new rural cooperatives at their household registration. Meanwhile, the method and procedure for the transfer and 
continuation of basic medical insurance is identified. In actual practice, the transfer and 
continuation of basic medical insurance for migrant workers is going on very well. For next step, 
we will continue to expand the coverage of basic medical insurance, launch the "all-round participation and registration plan", and set up more stable and sustained participation 
mechanism; enhance the quality of medical insurance, improve the method for the transfer and 
continuation of medical insurance, and ensure complete and continuous record of the rights and interests of participants. WT/TPR/M/300/Add.1 
 
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 3  PREGUNTAS DE ARGENTINA 
Pregunta 1 
En la página 39, párrafo 2.22 , el informe indica que el Ministerio de Comercio (MOFCOM) está 
trabajando en ciertas reformas comerciales, tanto en cuanto al comercio doméstico, como al 
entorno de negocios y al régimen de inversión extranjera.   
 ¿Podrían indicar específicamente en qué tipo de reformas está trabajando el Gobierno de 
China?  
 Answer 
Currently, MOFCOM is mainly taking the following measures to deepen the reform of the domestic trading and circulation system and to build a new system of open economy:  
Firstly, deepen the reform of domestic trade and circulation system, including eliminating regional 
barriers and breaking industrial monopoly; strictly regulating market order and rapidly publicizing information regarding administrative sanctions against infringement and counterfeiting; improving 
the overall distribution of domestic trade and circulation, making more efforts to construct 
circulation facilities, promoting modernization of  the circulation, and actively fostering new 
consumption growth points.   
Secondly, create new competitive advantages for foreign trade, support large and comprehensive 
foreign trade service enterprises to develop, speed up the development of cross-border e-commerce, and expand purchasing trading; push forward the reform of customs clearance and 
make innovations in processing trade management modes. 
 Thirdly, make innovations in utilizing foreign capital management system. Make overall planning 
for revision of the three laws relating to foreig n investment, negotiations of bilateral investment 
agreements and reform of the foreign investment management system, and create a fair and competitive business environment without discrimination for both domestic and foreign investment enterprises. Liberalize the foreign investment access, push forward the orderly opening of service 
industries, and ease the market access restrictions for foreign investment in such service fields as 
child care, care for the elderly, architecture desi gn, trade and logistics, e-commerce, etc. Properly 
develop and manage the CSPFTZ so as to form a mechanism that can be copied and promoted. 
 
Fourthly, push forward the reform of outbo und investment management modes, revise 
administrative measures on outbound investment , further simplify verification procedures with 
emphasis put on filing system, and largely delega te the power to examine and approve to lower 
levels. Launch pilot programs for individuals to make investments overseas and push forward the negotiations of the Sino-US investment agreements and the Sino-EU investment agreements.   
Fifthly, actively participate in the formulation of international economic and trade rules, push 
forward the negotiations of service trade agreements, government procurement agreements and information technology agreements, and speed up the negotiations of new topics such as 
environment protection and e-commerce. Actively participate in the construction of high-standard 
free trade areas and accelerate the negotiations with Korea, Australia, the Gulf Cooperation Council and other free trade areas. 
 
Sixthly, put more efforts to plan and develop the Silk Road Economic Belt and the 21st-century Maritime Silk Road, push forward the development of the Bangladesh-China-India-Burma Economic Corridor and the China-Pakistan Economic Corridor, launch a series of large support 
projects, speed up infrastructure connection, an d expand a new space for international economic 
and technical cooperation. Further open up inland and border areas to form a new pattern of comprehensive opening-up. 
 WT/TPR/M/300/Add.1 
 
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 Pregunta 2 
En la página 39, párrafo 2.24  el informe menciona que existen procedimientos simplificados 
para la inversión extranjera, pero sólo para aquellos proyectos incluidos en sectores que no se 
encuentren en la "lista negativa".  
 
 ¿Podrían indicar exactamente cuáles son los sectores que se incluyen en esta lista?  
  ¿Qué criterios se utilizan para incluir sectores en dicha lista y con qué periodicidad se 
actualiza la misma?  
 Answer 
The "Special Administrative Measures (Negative List) on Foreign Investment Access to the China (Shanghai) Pilot Free Trade Zone (2013)" (the "Negative List"), is compiled according to the "Classification and Codes of National Economic Industries (2011)" and includes 18 sectors or 
industries, exclusive of such two sectors as public management, social security and social 
organizations, and international organizations. The Negative List sets out administrative measures applicable to foreign investment projects and establishment of FIEs in the CSPFTZ where "national 
treatment" is not granted. The Negative List will be adjusted when deemed appropriate in 
accordance with foreign investment laws and regulations and in light of the development needs of CSPFTZ. 
 
Pregunta 3 
En la página 42, párrafo 2.25 , el informe indica que los proyectos de inversión extranjera son 
clasificados en "alentados", "permiti dos", "restringidos" y "prohibidos". 
 
  ¿Podrían indicar cuáles son las bases sobre las cuáles se incluyen a los proyectos dentro de 
estas categorías?  
  ¿Existe una publicación oficial del Gobierno de China en donde se puede acceder al listado 
de tipos de proyectos y su correspondiente clasificación?  
Answer 
To ensure the coordination between foreign investment and the Chinese guideline for national economic and social growth, and to protect the legitimate interests of investors, the Chinese government promulgated the Provisions on Guidin g Foreign Investment Direction in 2002, which 
not only classifies foreign investment into fo ur categories, namely, encouraged, permitted, 
restricted and prohibited, but also defines the criteria. Those foreign investment projects, belonging to the categories of encouraged, restri cted and prohibited, are listed into the Catalogue 
for the Guidance of Foreign Investment Industri es. Those, which fall outside the categories of 
encouraged, restricted and prohibited, belong to the permitted and are not listed into the Catalogue for the Guidance of Foreign Investment Industries. At present, the effective Catalogue for the Guidance of Foreign Investment Industries is the one revised in 2011 and gives detailed 
classification for various industries. The above-mentioned documents can be found in the website 
of the National Development and Reform Commission.  
Pregunta 4 
En la página 50, párrafo 2.76 , el informe menciona que, a los efectos de atraer la inversión 
extranjera directa y promover el desarrollo económico, China aplica regímenes impositivos 
preferenciales en diversas regiones específicas, destacando las Zonas Económicas Especiales , las 
Ciudades Costeras Abiertas , las Zonas de Desarrollo Económico y Tecnológico  y otras regímenes 
en ciudades específicas, como Tianging, Pudong y Yangtze . 
 
  ¿Podrían indicar cuáles son las diferencias, en cuanto a los regímenes impositivos 
preferenciales se refiere, que existen entre cada una de estas zonas?  
 
Answer 
The enterprise income tax preferential treatmen t was implemented in the said zones before the 
end of 2007 and was annulled after the Enterprise Income Tax Law came into effect in 2008. 
Before the release of the new enterprise income tax law, companies of foreign investment working 
on infrastructure (airport, port, wharf, railway, highway, power station, coal and water conservancy) and agricultural development in Hainan Economic Special Zone, and those working on energy and transportation (airport, port, railway, highway and power station) in Shanghai WT/TPR/M/300/Add.1 
 
- 21 - 
 
  
 Pudong New Zone, where the period of operations is fifteen years or more, shall be exempted from 
enterprise income tax from the first year to the fifth years starting from the year beginning to make profit and subject to enterprise income tax at a rate reduced by one half for the sixth year 
through the tenth year, according to the Income Tax Law of the PRC for Enterprises with Foreign 
Investment and Foreign Enterprises. Even after the implementation of the new income tax law, 
they can enjoy this policy until the expiration, but due to the absence of profit which leads to the 
failure of enjoying this preferential treatment, th e preferential period will be calculated from 2008. 
 Pregunta 5 En la página 51 , el informe describe que, desde 2013 China ha puesto en marcha un proyecto 
denominado "Zona Piloto de Libre Comercio" ( China Pilot Free Trade Zone-CSPFTZ)",  y que, en el 
marco del mismo, se aplican medidas tendientes a facilitar el comercio.  
  ¿Específicamente qué tipo de medidas se aplican para facilitar el comercio en esta zona y 
qué requisitos deben cumplir las empresas extranjeras para acceder a este beneficio? 
  Siendo el CSPFTZ un proyecto "piloto", ¿podrían indicar cuál es el plazo en el cual 
culminará este proyecto, y si hay en marcha alguna iniciativa para reemplazarlo? 
 Answer  
China Shanghai Pilot Free Trade Zone (CSPFTZ) is a major step taken by China to push forward its 
reform and opening-up under the new situation. CS PFTZ will take such measures as speeding up 
the transformation of governmental functions, ex panding the liberalization of investment sectors, 
pushing forward the transformation of trading mo des, deepening the liberalization and innovation 
of the financial sector, and improving the institutional guarantee of the legal sector so as to 
become a pilot free trade zone of international standards that facilitates trade and investment and features free currency exchange, effective and effi cient regulation as well as well-developed legal 
environment. 
 Pregunta 6 En la página 57, párrafo 3.6  el informe indica que en 2012 China comenzó la implementación de 
un programa denominado "Reforma hacia Declaraciones Aduaneras sin Papeles (Reform of 
Paperless Customs Clearance)" , que abarca tanto importaciones como exportaciones, y en virtud 
de la cual, las empresas son clasificadas con las letras "A" o "B", para determinar su posterior 
tratamiento aduanero.  
 
  Se solicita indicar bajo qué criterios se incluyen a las empresas bajo las categorías "A" o 
"B" y con qué periodicidad se actualiza esta clasificación. 
 Answer 
The classified management for enterprises by the General Administration of Customs of the PRC is 
not exclusively applied to the paperless clearance reform but an important measure which can be 
traced back to the adjustment of the General Administration of Customs to the economic growth and the demands for modern customs management mechanism, with the aim to introduce the risk 
management mechanism, guarantee the safety an d convenience of import and export trade, 
allocate the resources of the customs appropriately and enhance the efficiency of customs' management 
 
The General Administration of Customs classifies all registered enterprises into five categories, namely, AA, A, B, C and D in a descending order for their law observance and credit, based on enterprises' observance with laws, administration  regulations, customs provisions and rules for 
corruption, their operation status, customs supervisio n, statistics record, etc. The category will be 
changed according to the status quo of one co mpany. AA companies are the AEO of China and 
enjoy the most preferential and convenient clea rance measures. Companies of A category are of 
sound credit and are candidates for AEO compan ies. They exclusively can apply to be AA 
companies and are eligible for the convenient clea rance measure. Companies in the B category are 
general ones, to which the conventional cu stoms management measures are applicable. 
Companies of C and D categories are of low credit  and are correspondingly under strict supervision 
by the customs.  WT/TPR/M/300/Add.1 
 
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 Pregunta 7 
En la página 57, párrafo 3.7 , el informe indica que China aplica un régimen de importación de 
bienes, sin costo, para reemplazar "productos dañados".  
 
 ¿Qué bienes están incluidos en este régimen? 
 ¿A qué se considera un "producto dañado"? 
 
Answer 
There is no such a term of "damaged products" but "goods at no cost to replace damaged products". In line with the Article 29 of the Cust oms Rules on Administration of the Levying of 
Duties on Imports and Exports of the PRC, "goods at no cost to replace damaged products" 
means: after the customs clearance of the import/export products, due to reasons including damage, shortage, bad quality and wrong specific ation, shipper, carrier or insurer of these 
products shall compensate or replace at no cost with goods identical with the original products or 
in accordance with contract provisions.  
Pregunta 8 
En la página 57, párrafo 3.8 , el informe indica que a pesar de que China se está esforzando por 
armonizar los procedimientos aduaneros en todo el territorio, sigue promoviendo la creación de nuevas "áreas de supervisión aduanera especial", con diferentes regulaciones entre sí. No 
obstante, en 2012, el Consejo de Estado estableció que dichos procedimientos se unificarán.  
 
 Por favor indicar en qué plazos y/o etapas prevé el Consejo de Estado unificar estos 
procedimientos. 
 Answer 
To meet the diverse demands for opening up and economic development during different stages in China, the State Council introduces six special customs supervision areas (SAs hereafter), that is, bonded area, export processing zone, bonded logistics park, cross-border industrial zone, free trade port area and comprehensive free trade zone. Those SAs play active roles in taking 
international industrial transfer, promoting the tr ansformation and upgrading of processing trade, 
extending foreign trade and creating employment. The General Administration of Customs of the PRC speeds up the integration and optimisation of SAs in a steady manner with the aim of 
integrating the current SAs categories. Under the pr econdition of not exceeding the original area, 
the General Administration of Customs will integrate the current export processing zones, bonded logistics parks, cross-border industrial zones an d free trade port areas and eligible bonded areas 
into comprehensive free trade zones. For newly es tablished SAs, they will be named uniformly as 
"comprehensive bonded zones" in principle.  The integration of customs SAs will be implemented on the basis of taking suggestions from local 
governments. Those SAs, which do not fulfil the conditions for integration, can be reserved 
temporarily.  
Pregunta 9 
En la página 58, párrafo 3.13, el informe indica que China establece aranceles "provisionales" o "interinos", que se aplican a ciertos productos durante un período determinado (normalmente de 
un año). 
 
 ¿Cuáles son los productos sujetos a la aplicación de estos aranceles? 
 ¿Qué criterios se utilizan para elegir dichos productos?  
 
Answer 
The State Council Tariff Commission (SCTC) determines and adjusts the import and export tariff 
rate in line with the national economic development, as well as the production, consumption, 
import and export of relevant products. It will al so decide the commodities of interim tax rates, tax 
rates and periods. WT/TPR/M/300/Add.1 
 
- 23 - 
 
  
 Pregunta 10 
En la página 64, párrafo 3.27 , el informe indica que "aparentemente", China no ha aplicado 
ninguna cuota a la importación.  
 ¿Podrían confirmar si China no ha aplicado ninguna cuota en el periodo bajo examen?  
 ¿Cuáles son los productos que están sujetos a cuotas actualmente?  
 
Answer 
During this review period, China does not implement import quota.  
 Pregunta 11 
En la página 65, párrafo 3.28, el informe indica que la última información disponible de China 
sobre los productos cuyas importaciones están prohibidas, data del año 2009.   
 Por favor indicar cuáles son los productos sujetos a prohibiciones a las importaciones 
en la actualidad o bien en qué sitio oficial se publica esta información. 
 
Answer 
According to the Article 16 of the Foreign Trade La w of the People's Republic of China, the country 
can prohibit the import and export of some products due to relevant causes. Up to the present, China has promulgated six lists for prohibited import products. Related information is available in 
the websites of MOFCOM, the Ministry of Environmental Protection and the General Administration 
of Customs.  
Pregunta 12 
En la página 74, párrafo 3.69 , el informe menciona que dentro de los procedimientos para 
elaborar y emitir una norma existe la posibilidad de que se puedan realizar comentarios dentro de 
un periodo no mayor a los dos meses.   
 
 ¿Cómo funciona el mecanismo a través del cual se pueden realizar los comentarios?  
 ¿Pueden las empresas extranjeras realizar comentarios? 
 
Answer 
According to requirement of TBT agreement, china will submit TBT notification to the WTO at the 
stage of drafting standards and technical regula tions and provide a period of 60-day for comments 
from the public, including FIEs. For the written comments within the period, relevant authorities responsible for drafting law and regulation w ill provide written answers after consideration.  
 
Pregunta 13 En la página 75, párrafo 3.73  el informe indica que, de conformidad con el "Reglamento sobre 
Certificación y Acreditación", los productos enumerados en el "Catálogo para la Certificación 
Obligatoria de productos" no se pueden importar en China a menos que tengan la "Certificación 
Obligatoria para China (CCC)" y lleven  la correspondiente marca "CCC".  
 
 ¿Cuánto dura el proceso para obtener una certificación CCC y cuáles son los requisitos 
que debe cumplir una empresa para obtenerla?  
 ¿Qué costo tiene la obtención de dicha certificación?  
 
Answer  
Article 16 of the Regulations for Compulsory Product Certification (Order of the AQSIQ No. 117) 
stipulates that with regard to products that conform to the certification requirements, under usual 
circumstances, the Certification Body issues the ce rtificate and notify the applicant within 90 days 
of the date of the acceptance of application.   
For products within the CCC catalogue, the detaile d requirements to be satisfied can be found in 
the regulations of compulsory product certification released by the Certification and Accreditation Administration of the PRC. Specific regulations for product certification are available in the website 
http://www.cnca.gov.cn/ywzl/rz/qzxc pzl/ssgz/201307/t2 0130717_1597. shtml. 
With regard to the charge standards of compulsory product certification, please refer to the Notice 
on Forwarding the Notice of Re-setting the Char ge Standards of Compulsory Product Certification 
of the National Development and Reform Commission (GUO REN CAI [2009] No. 20) (website: WT/TPR/M/300/Add.1 
 
- 24 - 
 
  
 http://www.cnca.gov.cn/ywzl/rz/qzxcpzl/rzsf /201405/P02014050836968 1780662.pdf) and the  
Notice on Forwarding the Notice of Printing th e Charge Standards (Trial) of Compulsory Product 
Certification and Testing of the National Development and Reform Commission (GUO REN ZHEN 
[2006] No. 38) (website:  
http://www.cnca.gov.cn/ywzl/rz/qzxcpz l/rzsf/200610/t20 061001_1599.shtml). 
 
Pregunta 14 
En la página 76, párrafo 3.77 , el informe menciona que China tiene algunas leyes sanitarias y 
fitosanitarias anticuadas y repetitivas.   
 ¿Cuáles son las razones por las cuales el gobierno de China no ha actualizado ni 
armonizado dichas leyes? 
 ¿Piensa el gobierno de China tomar alguna  medida al respecto en el futuro?  
 
Answer 
China's SPS system is under regulation by different Government agencies based on different 
industries, sectors and stages. Currently the National Health and Family Planning Commission of 
the People's Republic of China (NHFPC), the Mi nistry of Agriculture (MOA), AQSIQ, the State 
Forestry Administration (SFA), MOFCOM, and the State Food and Drug Administration (SFDA) are 
actively involved in regulating the SPS regime. 
 
After the 2013 institutional reform and transformati on of government functions, and as new issues 
surface from the food safety supervision over recent  years, China is working on the revision of the 
Food Safety Law. The Standing Committee of the National People's Congress plans to review the 
revised draft of the Food Safety Law in a recent date.  
Pregunta 15 
En la página 79, párrafo 3.89 , el informe explica que se realizan reducciones o exenciones de 
impuestos a las exportaciones de zonas económicas especiales y otras zonas especialmente designadas, empresas específicas y empresas con inversión extranjera.  
 
 ¿Podría China indicar específicamente cuáles son las zonas económicas especiales o 
especialmente designadas?  
 ¿Cualquier empresa puede gozar de este beneficio? ¿Cuáles son los requisitos que 
debe cumplir una empresa para acceder al mismo? 
 
Answer 
At present, China does not implement export tax reduction or exemption for special economic 
areas, other specially-designated areas, specific enterprises or foreign investment enterprises.  
 
Pregunta 16 
En la página 85, párrafo 3.110 , el informe indica que el Eximbank  de China estableció un "canal 
verde" para la presentación, examen y aprobación de las solicitudes de préstamos por parte de las 
PyMES.  
 
 Se solicita indicar en qué consiste este "canal verde" y cuáles son los requisitos para 
acceder a los préstamos disponibles. 
 Answer 
The China Export-Import Bank ("China EximBank") actively implements the policy of the State 
Council for supporting the development of small and micro businesses and has formulated a series 
of credit policies to support small and micro businesses according to its management and business features, including formulating differential pre-loan investigation and post-loan management 
systems regarding credits granted to small and micro businesses, making innovations in 
developing a uniform loan lending and repayment mode as well as various loan options for small and medium-sized enterprises expansion programme, and simplifying the examination and 
approval procedures of loans granted to some small and micro businesses. Compared with large 
and medium-sized enterprises, small and micro businesses enjoy more generous loan access thresholds, richer loan options and modes and simpler approval procedures, when applying for loans with the China Exim Bank. WT/TPR/M/300/Add.1 
 
- 25 - 
 
  
 Pregunta 17 
En la página 85, párrafo 3.111 , el informe menciona que China no ha brindado información 
ampliada sobre los programas de créditos a la exportación, por considerar que dicha información 
es de carácter "confidencial".  
 
 ¿Podrían explicar de qué forma pueden acceder las empresas a información más 
detallada sobre los diferentes tipos de créditos a las exportaciones, a los efectos de 
considerar la posibilidad de acceder a ellos? 
 Answer 
The China Eximbank treats the information of loan applicants as its commercial secrets and therefore, is unable to provide such information externally. Enterprises may obtain the business introduction, application requirements, parties to  whom loans are granted, application materials 
and other detailed information regarding different types of export credits through public channels 
such as the website of the China Eximbank.  
Pregunta 18 
En la página 89, párrafo 3.127 , el informe indica que China ha puesto en marcha un "plan 
quinquenal" (2011-2015) tendiente a "transformar" y "modernizar" las industrias claves existentes, a los efectos de incrementar la competitividad del sector industrial de China.  
 
 Se solicita indicar específicamente qué medidas y beneficios incluye este programa y 
cuáles son los requisitos que deben cumplir las empresas para acceder a tales 
beneficios.  
 Tiene pensado el gobierno de China implementar un nuevo programa teniendo en 
cuenta que este plan termina en 2015?  
 
Answer 
Against the critical background of comprehensively building a well-off society, China's 12th Five 
Years Plan is an important development roadmap composed in a crucial period for strengthening 
the reform and opening up and speeding up the tran sformation of economic growth models. It is a 
blueprint for China's economic and social growth bu t does not cover preferential policies. Reform is 
the most prominent bonus supporting China's econom ic and social development. Market itself will 
play a decisive role in allocating resources and encouraging enterprises to innovate themselves so 
that the competitiveness of China's industries will be gradually enhanced and the industrial 
modernization will be realized. In 2014, the National Development and Reform Commission 
initiated the drafting and composition of the 13th Five Year Plan, which will be publicized and 
implemented at the beginning of 2016.  Pregunta 19 
En la página 102, párrafo 3.3.3 , el informe describe muy brevemente el régimen de comercio de 
estado vigente bajo la Ley de Comercio Exterior de 2004.   
 ¿Podrían las autoridades de China facilitar un listado completo de los productos que 
están sujetos a comercio de estado o la página Web en donde se encuentra publicada el mismo?  
 ¿Podrían explicar cuáles son los criterios que utiliza el MOFCOM para agregar o retirar 
productos de esta lista?  
 Answer 
In accordance with the 11th article of the Foreign Trade Law, the State may subject certain goods 
to state trading. At present, commodities subjec t to state trading include rice, maize, wheat, 
sugar, cotton, crude oil, processed oil, chemic al fertilisers, tobacco, etc. Export commodities 
subject to state trading mainly consist of rice, maiz e, cotton, crude oil, processed oil, coal, silver, 
antimony ore and its products and tungsten ore and its products.  WT/TPR/M/300/Add.1 
 
- 26 - 
 
  
 Pregunta 20 
En la página 110, párrafo 3.200 , el informe indica que durante el periodo bajo examen China ha 
aplicado medidas para mejorar el entorno normativo de protección de los derechos de propiedad 
intelectual (DPI). No obstante, se mencionan solo dos cambios, referidos a las Leyes de marcas y 
de patentes.   
 Se solicita indicar específicamente cuáles han sido las demás medidas que China aplicó 
para mejorar el entorno normativo de los DPI.  
 Answer 
1. As for copyright, firstly, the Chinese Government  is making revision to the Copyright Law of the 
People's Republic of China; secondly, the Nation al Copyright Administration (NCA) released the 
Opinions on Further Strengthening the Regulation  of the Copyright of Works Transmitted through 
the Internet on December 30, 2013 in order to regulate the legal transmission of works in the 
Internet and protect the legitimate rights and interests of the copyright holders; thirdly, the Chinese government has revised provisions regarding administrative sanctions in the 
Implementing Regulations of the Copyright Law,  the Regulations on Protection of Computer 
Software and the Regulations on Protection of the Right of Communication through the Information Network, while the NCA and the National Development and Reform Commission jointly formulated the Measures for Payment of Remunerations for Use of Works by Textbooks through Statutory 
Licensing; and fourthly, the NCA formulated and released the Implementing Rules for the Legal 
Publication by News Publication (Copyright)& Administrative Enforcement Agencies of Information regarding Administrative Sanctions in Counterfeitin g and Intellectual Property Right Infringement 
Cases (for Trial Implementation), revised and released the Administrative Measures for National 
Copyright Demonstration Cities, Units, Park Zones and Bases, and drafted the Regulations on Protection of the Copyright of Folk Literary Works (Draft) and the Measures for Payment of 
Remunerations for Use of Written Works (Draft).  
 2. As for patent right, see paragraph 3.200 and paragraph 3.202 of the Report by the Secretariat.   
Pregunta 21 
En la página 134, párrafo 4.43 , se explica que a finales de 2012, cuatro empresas (China 
Telecom, China Mobile, China Unicom, y CITIC) obtuvieron licencias para negocios básicos de 
telecomunicaciones y 26.979 empresas han obtenido licencias para negocios de 
telecomunicaciones de valor agregado.   
 ¿Podría China explicar cuáles son los requisitos para obtener estas licencias y si las 
empresas extranjeras pueden tener acceso a las mismas? 
 Answer 
First, with regard to the basic telecommunicati on business, the condition stipulated by the 10th 
Article of the Regulations on Telecommunications of the PRC (State Council Decree No 291) must 
be met. Besides, when the Chinese Ministry of Industry and Information Technology reviews the 
application for basic telecommunication business, it will consider factors including the 
telecommunication network safety, the sustainabl e utilization of telecommunication resources, 
environmental protection and competition in the telecommunication market.  
 
Second, as for value-added telecommunication business, the condition set by the 13th article of the 
Regulations on Telecommunications must be met.   
Third, foreign investors can apply those telecommunication businesses that China promises WTO 
to open, in line with the Regulations on Administration of Foreign Invested Telecommunication Enterprises (State Council Decree No 534). For detailed conditions, please refer to the Article 13, 
Article 14 and Article 16 of the Regulations on Telecommunications. 
 Pregunta 22 
En la página 158, párrafo 4.131 , del informe se menciona que se establecerá un mecanismo 
normalizado de subvenciones en el sector de los ferrocarriles.   
 ¿Podría China explicar cómo será este mecanismo?  WT/TPR/M/300/Add.1 
 
- 27 - 
 
  
 Answer 
The year 2013 witnessed the separation of govern ment functions from enterprise management in 
railway. As a result, the National Railway Admi nistration of the PRC and the China Railway 
Corporation are organised. As the State Council's Reply Concerning Relevant Issues for the 
Organising of China Railway Corporation (Guo Han [2013]47) stipulates, the China Railway Corporation is responsible for the transportation of public interest nature ruled by the State. 
Meanwhile, this Reply states that a subsidy mechanism for public interest railway transportation 
will be established. For public interest transpor tation tasks targeted at students, wounded and 
disable soldiers and agricultural materials, and fo r operation loss due to the public interest railway, 
for instance, Qinghai-Tibet railway and Nanjiang railway, a subsidy mechanism for the public 
interest railway transportation as well as the model for fiscal subsidy will be set up after research. 
The loss due to the public interest railway tran sportation will be compensated appropriately. 
 
Pregunta 23 
En la página 159, párrafo 4.141 , se menciona que se aplican cuotas para emplear extranjeros 
en el sector de la pesca y en otros sectores de la industria. Además también se explica que se 
implementarán nuevas cuotas en el futuro.  
 
 ¿Podría China describir cuales son los sectores donde se aplican cuotas para emplear 
extranjeros y cuáles son los sectores donde se planea aplicar nuevas cuotas en el 
futuro?  
 Answer 
Whether to carry out or raise new quota will be decided by the demands of domestic market. Further liberalizing service industry is part of th e strategy of opening up. China will stick to the 
policy of opening up during long terms. WT/TPR/M/300/Add.1 
 
- 28 - 
 
  
 4  QUESTIONS BY HONG KONG, CHINA 
PART I: QUESTIONS REGARDING THE SECRETARIAT REPORT 
 
TRADE POLICIES BY SECTOR 
 Page 138 (Para. 4.55) 
 
Financial Services  The China Banking Regulatory Commission (CBRC) is identifying and defining regulatory policies 
for shadow banking. The measures under cons ideration include defining the division of 
responsibilities and clarifying the supervision an d management responsibilities of all types of 
entities; defining supervision and segregatio n measures so as to promote standardised 
development of all types of institutions and businesses; investigating the potential risks; and 
educating the public and consumers.  
Question 1 
Please share with us the latest development of  the regulatory policies for shadow banking, 
including the latest administrative progress and its implementation schedule (if any). Would the Chinese authorities refer to any international practices or consult the industry in formulating the 
policies? 
 Answer 
China has researched on regulation of shadow bank ing and formulated relevant regulation policies, 
which mainly include:  1) Specify regulatory and administrative liabilities of various financing entities, strengthen overall 
regulation and administration of financing activities;  
2) various regulatory authorities have formulated corresponding policies respectively so as to promote normalized development. Such work is being carried out actively;  3) Various regulatory authorities have enhanced re gulation and coordination to prevent regulatory 
arbitrage; 
4) Regulatory authorities have improved industrial information system and perfected information sharing mechanism.  
When formulating regulatory policies on shadow ba nking, China will refer to international practices 
and consult with the banking industry for opinions. According to current situation, part of China's regulatory policies on shadow banking is stricter than international practices. In the next step, 
China will continue to strengthen information sh aring and academic exchanges with international 
organizations of financing regulation and social financing institutions.   Page 141 (Para. 4.67) 
 
We noted from the Secretariat Report that measures have been taken to encourage private capital to invest in commercial city banks, commercial ru ral banks and village banks. The CBRC has also 
encouraged private enterprises and natural persons to  participate in the property rights reform of 
rural cooperative financial institutions, the reconstruction of high-risk institutions and the establishment of village banks by removing geographical restrictions for private capital to invest in 
small and medium financial institutions in the countryside, and by raising the shareholding ratio of 
a n  i n d i v i d u a l  p e r s o n  f r o m  2 %  t o  5 % ,  w i t h  a  s p ecial increase in the shareholding ratio of an 
individual person in a village bank to 10%. The shareholding ratio of single enterprise and its affiliated parties that have merged and reorganised high-risk rural credit cooperatives has been 
raised. 
 Question 2 
Do the measures also allow the participation of foreign investment in commercial city banks, 
commercial rural banks and village banks?  WT/TPR/M/300/Add.1 
 
- 29 - 
 
  
 Answer 
China Banking Regulatory Commission (CBRC) has lo ng been allowing qualified overseas financing 
institutions to invest in and become shareholders of city commercial banks. According to relevant 
provisions in the Measures for the Implementation of Administrative Licensing Matters of Chinese 
Commercial Banks, overseas financial institutions to become shareholders of Chinese commercial banks shall meet the following requirements:  
1. Total assets shall be no less than US$10 billion at the end of the last year;  
2. Long-term credit rating has been good in the past two years;  3. being profitable in the past two consecutive accounting years;  4. capital adequacy ratio of commercial banks sha ll reach the average of that in its registration 
place and shall not be lower than 10.5%, or the total amount of capital of non-banking financial 
institutions shall not be lower than 10% of the total amount of weighted risk assets;  5. internal control is perfect and effective, and etc.   
 
In addition, the proportion of shares of an individual overseas financial institution and its affiliated parties in an individual Chinese commercial bank shall not be more than 20%, while the proportion 
of shares of multiple overseas financial institutions and their affiliated parties in a Chinese 
commercial bank shall not be more than 25%. In the next step, CBRC will continue to support qualified overseas financial institutions to invest in city commercial banks and optimize structure of shares in city commercial banks.  
 
CBRC encourages and supports equity participation of overseas banks in small and medium rural financial institutions to achieve win-win in accordance with the principle of "holding shares for long 
time, optimizing governance, business cooperation and avoidance of competition" .Based on The 
Measures for the Implementation of Administrati ve Licensing Matters of Rural Small and Medium 
Financial Institutions, for an individual overseas bank and its controlled affiliated parties or jointly 
controlled affiliated parties investing in an individual rural commercial bank as organizer(s) or 
strategic investor(s), the proportion of shares shall be no more than 20%, while for multiple 
overseas banks and their controlled affiliated parties or jointly controlled affiliated parties investing in an individual rural commercial bank as organizers or strategic investors, the proportion of 
s h a r e s  s h a l l  b e  n o  m o r e  t h a n  2 5 % .  A n d  t h e r e  i s  n o  l i m i t  t o  t h e  p r o p o r t i o n  o f  s h a r e s  f o r  a n  
individual overseas bank to invest in village banks.  
Page 142 (Para. 4.76) 
 Pursuant to the amendment of "Regulations on the Administration of Futures Trading" in 2012, 
foreign institutions conforming to certain requirements are allowed to participate in specific futures 
trading. Crude oil will be the first of these trading areas to be opened up, while other possible types of trades have not yet been determined. The relevant measures are currently under the 
consideration by the China Securities Regulatory Commission. Qualified foreign institutional 
investors may participate in stock index futures trading, while other foreign entities or individuals 
may not.  
Question 3 
We are interested to know what factors were taken into account when determining the trading areas to be opened up for foreign institutions. Did the Chinese authorities refer to any international 
practices or standards in formulating the requirements for foreign institutions? What is the 
timeframe for opening up foreign institutional investors' participation in stock index futures trading?   
Answer 
CSRC will conduct a comprehensive assessment on  various aspects to steadily promote the 
opening up of futures market, which include the process of free convertibility of RMB under capital 
account, overall strategy of opening up of financial market, features of the spot market for futures 
to be opened up (ex. the level of marketization of spot goods and the level of opening up, etc.), 
specific operating situation of futures market (ex. transaction size and position size, etc.) 
 
At present, CSRC is studying and drafting administrative measures for overseas institutions participating in transaction of special futures goods.  In the process of drafting, CSRC will fully refer 
to internationally advanced experience and system design, such as comprehensive account WT/TPR/M/300/Add.1 
 
- 30 - 
 
  
 management and overseas special economic participants, etc. and will standardize relevant 
requirements to overseas institutions based on the principle of reciprocity universally followed by the international community. 
 
CSRC will promote the opening up the stock index futures in a holistic way in accordance with the strategy of overall opening up of the capital market and A share market and the unified 
deployment of opening up the futures market, for which there is no timetable. 
 Page 153 (Para. 4.107)  
Education 
 According to the Report, a nationwide evaluation of Sino-foreign cooperative education was 
organized by the Ministry of Education (MOE) in  2013. The conclusions of the evaluation would 
focus on management mechanisms, funds manage ment, recruitment and academic credentials 
management, diploma and certificates, management, teachers' qualifications, teaching and 
learning organisation, and education quality. The evaluation was expected to complete before the 
end of 2013. The institutions found to have significant problems will be required to undertake rectification and reform within a stipulated period, and will be subject to sanctions such as suspension of pupils' recruitment. 
 
Question 4 What is the latest development of the evaluation, including its implementation progress, its result, 
and follow-up actions? What is the failure rate of the evaluation and the main reasons of the 
failure? Is it a compulsory evaluation for inst itutions and programmes approaching the expiry of 
the cooperation? Are there other cases in which such evaluation will be conducted?  
 
Answer 
To implement the education program and relevant provisions in the Regulations on Sino-foreign 
Cooperative education, the Ministry of Educat ion launched the evaluation on Sino-foreign 
cooperative education (above undergraduate course) in early 2003. The assessment includes three 
steps: self-evaluation by educative entities, onlin e publicity and comprehensive review, which have 
been well completed. This evaluation is aimed at in stitutions and programs to be expired, involving 
346 institutions and programs of 143 entities in  24 provinces and cities, including Beijing and 
Shanghai.  
According to the evaluation, 256 programmes and institutions were qualified among those who 
participated in evaluation, 43 programmes and institutions were qualified to some extent, 9 programmes were not qualified, with a qualification rate of 83%, a qualification rate to some extent of 14% and a un-qualification rate of 3%, re flecting the actual situation of the current Sino-
foreign cooperative education. 
 Through evaluation in 2013, the guidance of macro-policies and application of laws and regulations 
on Sino-foreign cooperative education have been  strengthened; the educative entities' awareness 
of " standardized management and education by  law" have been enhanced; a punishment and 
drop-out mechanism has been explored and established and self-discipline have been 
strengthened, so as to reach the goal of "promoti ng the establishment of educative institutions by 
means of evaluation" and improve the overall qu ality and level of Sino-foreign cooperative 
education.   
From now on, the Ministry of Education will further summarize experience, enhance supervision 
and administration, gradually establish and improv e a regular evaluation system of Sino-foreign 
cooperative education, separate ad ministration from evaluation, accelerate promotion of governing 
system of Sino-foreign cooperative education and modernization of governing capability, and 
steadily improve education and teaching quality and sustainable development capability.   WT/TPR/M/300/Add.1 
 
- 31 - 
 
  
 Page 109 (Para. 3.199) 
 Intellectual Property Rights (IPRs)  
 
According to the Secretariat Report, one of the st rategic themes of the State Intellectual Property 
Office (SIPO) is to enhance intellectual property (IP) creation by raising the quality of IPRs and 
innovation efficiency. In this regard, SIPO is continuing its work on the development of an 
automated trademark registration and management system.  Question 5 
What is the latest progress of the work on the development of the automated system? What is the 
target completion date? When the system ha s been developed, how will the trademark 
registration, administration and protection sy stem be different from the existing one?  
 
Answer 
The Trademark Department of SAIC is working on the release of trademark registration and 
automated system (Phase III). Now the development of the main program has been completed, 
after the release, work will be done on improvin g development of supporting functional modules 
and system optimization. The Phase III system ha s adjusted and optimized defects of the Phase II 
system, and the automated examination and disposal  system of trademark and the public service 
system have been developed. The automated ex amination and disposal system of trademark 
integrated 8 sub-systems of trademark business and adjusted the business process in accordance 
with the new Law of Trademark, so that the ex aminer could examine the trademark business with 
a double-screen computer. And the public service sy stem could provide online self-services such as 
online inquiry, online application and online announcement.  WT/TPR/M/300/Add.1 
 
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 5  QUESTIONS BY NEW ZEALAND 
PART 1:  QUESTIONS REGARDING THE SECRETARIAT REPORT  
 
TRADE AND INVESTMENT REGIME 
 Foreign Investment Regime 
 
China (Shanghai) Pilot Free Trade Zone (CSPFTZ)   WT/TPR/S/300 Page 52, para 2.83 
 
Section II, paragraph 83 of the Secretariat Report notes that "trade facilitation measures have been introduced, including the simplification of customs procedures and improvement of 
regulations". The paragraph also summarises the currently operational first tier opening, and the 
envisaged second tier opening (between the zone and the Chinese Customs territory).   
Questions 
1. Can China please describe any new inspection methods in the CSPFTZ and whether AQSIQ has implemented these?   
Answer 
AQSIQ has implemented 23 reform measures in CSPFTZ in total: cargo pre-inspection, acceptance 
of third-party inspection results, global repair and maintenance industry supervision, negative list 
for examination and approval of animals and plants, risk management of entry biological products 
and certification by place of origin of transit cargo. AQSIQ has implemented such measures in 
CSPFTZ. 
 
In addition, AQSIQ and such authorities as the customs and the maritime administration authorities are exploring the opportunity to establish a "single window" management system for international trade and hope to establish a cross-department comprehensive management and 
service platform for such businesses as trade, transportation, processing and warehousing with 
reference to international practice to promote information exchange, supervision recognition and enforcement assistance between different regulatory authorities and enable the different 
authorities to provide highly efficient and rapid services on the same platform. Enterprises may 
access and submit relevant standard digital information one time through a single window and receive the processing results through the single window. 
 
2. What has been China's experience using targeted electronic supervision by category as opposed to batch supervision, especially with regards to information management?   
Answer 
An electronic bill examination and risk analysis program is embedded in China's customs clearance 
system, which will process declaration manifests in different groups based on such issues as 
enterprise risks and cargo risks and will assist the customs staff to determine the measures of 
customs clearance management.  
3. When does China envisage the implementation  of a "second tier opening" between the zone 
and the China Customs territory?  Answer 
According to the Notice of the State Council on Prin ting and Distributing the Overall Plan of China 
(Shanghai) Pilot Free Trade Zone (GUOFA [2 013] NO.38), the third section regarding the 
innovation of the supervision model provides th at CSPTFZ implements the model of "first-tier 
opening" and strictly enforced the "effective and effi cient control at second tier". Currently, there is 
no timetable regarding the "second tier opening".   WT/TPR/M/300/Add.1 
 
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 TRADE POLICIES AND PRACTICES BY MEASURE  
Measures Directly Affecting Imports Customs Procedures and Requirements 
 
WT/TPR/S/300, page 57, para 3.6   
Section III, paragraph 6 of the Secretariat Report notes that in 2012 China started the 
implementation of the "Reform of Paperless Customs Clearance" to cover imports (exports) via air, sea and land. Under this reform the approved pilot enterprises graded B or higher could choose to clear customs either through a paper or paperless declaration via the China E-port system. 
Further, it notes that AA enterprises and A manufacturing enterprises which are approved by 
customs do not need to submit electronic supporting documents when making a customs declaration.  
 
Questions 4. Are the enterprises involved with this pilot programme from a particular industry or 
industries, and if so, can China please list these industries? 
 Answer 
There is no limitation or specific requirements  on the industry/sectors which the enterprises 
engaged in when involving in the Reform of paperless customer clearance.  
 5. Could China advise how often "AA"-rated  enterprises and "A"-rated manufacturing 
enterprises, which are approved by customs, ar e required by Customs to submit electronic 
supporting documents?   
Answer 
According to the Announcement of the General Administration of Customs on Deepening the 
Reform of Paperless Customs Clearance (GAC Announcement [2014] No.25), the AA-rated enterprises and the A-rated manufacturing enterprises who choose to make custom clearance in a 
paperless manner after approved by the custom s, might choose not to attach the hard-copy 
documents when submitting the electronic data du ring the custom clearance. If requested by the 
relevant customs when customs clearance, such enterprises shall submit the hard-copy documents 
within 10 days after the release of the goods. And the enterprises, which meet the requirements of 
keeping the deposit receipt (temporary keeping the document and deposit receipts) may keep the documents.  
 
Other Charges Affecting Imports   WT/TPR/S/300, page 62, para 3.22  
 
Section III, paragraph 22 of the Secretariat Report notes that "Imports are subject to Value Added Tax (VAT), which is collected by Customs on beha lf of the State Administration of Taxation".  
 
Questions 6. Can China describe the processes it follows to collect VAT at the border?  
 
Answer 
In accordance with the Customs Law of the People's  Republic of China, the import value-added tax 
and consumption tax imposed by Chinese Customs are referred to collectively as the import tax 
collected by the customs on behalf of the State Ad ministration of Taxation, which is designed to 
grant largest convenience to enterprises, generate  highest efficiency and minimize administrative 
costs. 
Currently, there is no separate imposition process for import value-added tax (including 
consumption tax), which will be imposed together with the import duties. After enterprises submit the declaration manifests of the imported cargos  to the customs, the customs clearance system 
will directly calculate the duties, value-added taxes and consumption taxes (if so required) based 
on the dutiable value of the imported cargo dete rmined by the customs and separately print out 
the payment receipts for duties, value-added taxes and consumption taxes if the customs finds no mistakes in declaration data and relevant documents upon examination. Thereafter, import WT/TPR/M/300/Add.1 
 
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 enterprises will pay taxes to banks (at the counter or by way of electronic payment. By the end of 
2013, more than 60% enterprises have paid taxes by way of electronic payment.  
WT/TPR/S/300, page 74, Table 3.6 
 Section III, Table 6 of the Secretariat Report notes the number of National, Sectoral and Local 
standards. The number of National standards in part icular, is shown to drop from 1,986 in 2012 to 
only 97 in 2013.  Questions 
7. Can China advise on the reason for such a significant drop in national standards?  
 Answer 
Section III table 6 of the Secretariat Report notes the number of National standards published was 1986 in 2012 and 97 from January to May in 2013. Th at is because the application, approval and 
publication of the national standards were done in the second half of the year. The number of 
national standards published in the whole year of 2013 was 1870, basically equal to that of 2012.  
 Sanitary and Phytosanitary Requirements   
WT/TPR/S/300, page 77, para 3.78, Table 3.8  
 Section III, paragraph 78 of the Secretariat Report notes the fragmentation of the regulatory 
authorities in China's SPS system. Currently the Ministry of Health (MOH), the Ministry of 
Agriculture, AQSIQ, the State Administration for Industry and Commerce (SAIC), MOFCOM, and 
the State Food and Drug Administration (CFDA) are actively involved in regulating the SPS regime. 
Table 3.8 also notes that four out of these five agencies have some form of responsibility for food 
safety.   Questions 
8. What plans does China have to de-fragm ent the responsibilities for food safety?  
 Answer 
WTO did not stipulate how many departments a memb er country should have to be responsible for 
measures on phytosanitation, many member countries including the U.S., have multiple 
departments to be responsible for SPS measures, and measures of each department involve 
international trade. General Administration of Qu ality Supervision, Inspection and Quarantine of 
China are responsible for regulation of import an d export of food, animals and plants as well as 
animal and plant products; China Food and Drug Ad ministration and the Ministry of Agriculture are 
responsible for regulation of production and circulation within the territory; National Health and 
Family Planning Commission of China are responsi ble for formulating national standards on food 
safety. China adopts the subsection management by different departments, who have respective 
and they cooperate each other. So there is no problem of fragment/overlapping of regulators on 
the sanitation and phytosanitation system mentioned by Section III paragraph 78 of the 
Secretariat Report.  
Measures Affecting Production and Trade 
 Incentives  
WT/TPR/S/300,page 88, para 3.124  
 Section III, paragraph 124 of the Secretariat report states that China has set up several funds to 
support agriculture, including those that are aimed at promoting innovation in the sector, 
supporting the use of technology in the sector, and financing interest payments on loans for irrigation projects aimed at saving water. New Zealand notes that these projects have now been in 
place for more than a decade.  WT/TPR/M/300/Add.1 
 
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 Questions 
9 Could China please provide an update on the progress of these projects, and share its 
experiences on how successful they have been  in encouraging innovation and the use of 
technology? 
 Answer 
The agricultural production efficiency is low for a long time and the development of China's agricultural sector is restricted and Chinese peop le's grain safety and food safety are threatened 
by various problems such as slow technical research and development and promotion of the agricultural sector. For the purpose of speeding up the promotion of advanced agricultural 
technology and raising output and quality of agricultural products, in recent years, central 
government will allocate funds from central fiscal to support transformation of agricultural technology and promotion agricultural technology each year. 
In practice, as China's agricultural scientific and technical level is relatively backward and its 
technical promotion is still in its early stage, supports for promotion such advanced and suitable agricultural technologies as may comply with actual needs of villages are helpful in releasing 
productivity of villages, raising agricultural pr oduction efficiency and scientific and technical 
contribution to agricultural production currently. When China's agricultural scientific and technical level is gradually growing, the effects of relevant  p o l i c i e s  w i l l  b e  r e d u c e d .  I n  f u t u r e ,  w e  w i l l  
continue to enhance our communication and cooperation with various countries in the worlds, 
especially the members of WTO to share experience in promotion of agricultural technologies and 
transformation of scientific and technical results. In addition, the fund for interest discount on loans for the purpose of agricultural water-saving 
irrigation has been cancelled in 2012. 
 WT/TPR/S/300, page 88, para 3.126  
 
Section III, paragraph 126 of the Secretariat Report notes that in addition to the programmes notified by China, there appear to be other support programmes and other means to support different industries (e.g. fisheries) including through the provision of grants, policy lending by 
state-owned banks and the supply of goods at lower than "market price" by state-owned 
enterprises (SOEs), and in Table A3.6 summarises examples of such programmes as they affect fisheries.  
 
Questions 10. Can China confirm whether the information in Table A3.6 is correct and whether China will 
be including these and any other programmes affecting fisheries in its notifications under the 
Agreement on Subsidies and Countervailing Measures?  Answer 
China is still in the process of verifying the info rmation contained in table A 3.6. Many programs 
listed in Table 3.6 are vague, sourcing from various channels, without mention the department and scope. China needs more time for verification.  
 
11. Can China advise on any initiatives to eliminate subsidies that contribute to overcapacity and overfishing, including its approach to introducing new such subsidies or extending or enhancing 
existing programmes involving such subsidies?  
 Answer 
When the last subsidy notification of China was prepared there was not much information 
identified to be specifically related to the fishery industry. In the course of China's preparation for 
the next notification if certain programs are identified to be specific for the fishery sector and should be subject to the notification obligation un der the SCM Agreement, they will be included in 
the notification. China will carry out the work taking into account the information in the Table A3.6 
in the Secretariat Report. WT/TPR/M/300/Add.1 
 
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 WT/TPR/S/300, page 89, para 3.127  
 Section III, paragraph 127 of the Secretariat report states that China seeks to establish special 
funds for the development of new strategic industries and investment, increasing the number of 
public start-ups in rising industries, guiding "social" capital to be invested in innovative start-ups, making use of financial preferential policies, and encouraging financial institutions to strengthen 
credit support.  
 Questions 12. Could China please provide information on wh at it plans to put in place to achieve these 
goals? 
 Answer 
Currently, our understanding is the special funds for investment mentioned in the secretarial report is a kind of venture fund to be invested in venture enterprises in early or middle phase by way of equity and to be operated and managed by market-oriented ways. 
 
PART 2: QUESTIONS REGARDING THE CHINA COUNTRY REPORT  TRADE AND INVESTMENT DEVELOPMENT AND RELATED POLICIES  
Constructing Economic and Trade Partnershi ps Based on Mutually Beneficial and Win-
Win Principle 
 WT/TPR/G/300 page 22 para 3.46  
 
Section III, paragraph 46 of China's Country Report states "China will advance the implementation of "Bali Package", especially the Trade Facilitation  Agreement in accordance with the timetable set 
out in the Bali Ministerial Declaration."  
 Questions 13. Could China advise on what steps it is taking in preparation for implementation of the Trade 
Facilitation Agreement? 
 Answer 
China continues to promote trade facilitation. For the purpose of properly implement the Agreement, the Chinese Government has adopted the following measures:  1
）Enhancing promotion and training on trade facilitation among the customs offices at various 
levels; 
2）Promoting the implementation of the Agreement with reference to customs legislation and 
reforms, incorporating the contents of the Agreement into the legislation plan of the General 
Administration of Customs on 2014, listing such issues as "single window", "cross-customs-
processing-zone transfer of cargos" and "simplif ying charges and formalities" into the pilot 
programme of "single window", "integrated reform of regional customs clearance", "streamlining administration and delegating powers" and other core reform tasks, intending to upgrade the official website of the customs and enhance political affairs and information publicity. 3
）Discussing about the English version of the Trade Facilitation Agreement reached in Bali, raising 
legal comments on relevant contents and dispatching personnel to attend the legal review meeting 
of PCTF. 
4）Enhancing investigation and communication, initially investigating the possible difficulties to be 
encountered during the implementation of the Ag reement and raising opinions of the Customs on 
the types of relevant provisions and commitments. 
5）Enhancing legislations, converting multilateral trading system to domestic legislations, 
streamlining current customs laws and regulations, suggesting to cancel, adjust, add or replace 
those not in compliance with the Agreement or not suitable to the actual circumstances and keeping the policy and legal system of the customs co nsistent with the actual conditions of China, 
the practice of the customs and the Agreement; 6
）Promoting the implementation of the Agreemen t through multilateral cooperation between the 
customs, actively attending the meetings of the Preparation Team for Trade Facilitation of WTO, 
and advocating establishing the Trade Facilitation Agreement as a permanent project under the  
customs cooperation framework for the first time to promote the implementation of the WT/TPR/M/300/Add.1 
 
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 multilateral agreements through regional cooperation by taking advantage of China being the 
Chairman of SCCP of APEC. In future, Chinese customs will also organize preaches on the Agreement, extend significant efforts 
in publicize trade facilitation measures of the cu stoms, continue the systematic researches on the 
Agreement, actively serve the needs of the cust oms in reforms and system innovation, enhance 
cooperation and coordination on various levels and make positive contribution to the 
implementation of the Agreement. WT/TPR/M/300/Add.1 
 
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 6  QUESTIONS BY ICELAND 
Question 
Is it correctly understood that as of 2014 fish live r oil products are subject to a registration as 
health care products with China's State Food and Drug Administration before they can be sold in 
China? If this is correct, could China explain the background to such a new requirement for this product. 
 
Answer 
All the imported food sold in China shall comply with the provisions of the Food Safety Law of 
China and the corresponding implementation regulations. According to the Reply from the General 
Office of the National Health and Family Planning Commission on the Questions Relating to Fish Liver Oil Products (GWBSPH [2014] No.297), fish liver oil products are listed in the Pharmacopoeia of the People's Republic of China, which are not ordinary foods in Chinese history. According to 
relevant provisions such as the Measures for the Administration of Registration of Health Food (for 
Trial Implementation) (No.19 Order of the St ate Food and Drug Administration) and the 
Regulations on Application and Review of Nutrient  Supplements (for Trial Implementation) (GSYJZ 
[2005] No. 202), fish liver oil can be used as raw material for health foods. During the registration 
procedure for a specific product, the applicant sh all provide relevant documents as to the source, 
quantity, production process, process parameters, quality inspection report and proof delivery of 
the fish liver oil contained in the product. WT/TPR/M/300/Add.1 
 
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 7  QUESTIONS BY SWITZERLAND  
Report by the Secretariat 
 
Summary 
 
Question 
Para. 30  states: "China's competition law covers al l types of enterprises; however, immunity 
against the provisions of the law is granted to St ate-owned enterprises (SOEs) that are considered 
vital to the Chinese economy and to safeguard national security, or that have been granted legally-exclusive production and sales rights. Concentrations above certain thresholds must be 
notified and are subject to a prior anti-trust revi ew." Could the Chinese authorities please provide 
further information which SOEs are currently granted immunity and to what extend they are considered vital for the Chinese economy? 
 
Answer 
Although according to Article 7 of the Anti-Monopol y Law, with respect to the industries which are 
under the control of the State-owned economic se ctor and have a bearing on the lifeline of the 
national economy or national security and the industries which run exclusive business and sale of certain commodities according to law, the State shall protect the lawful operations of the undertakings, paragraph 2 of the same Article stipulates, the undertakings mentioned in the 
preceding paragraph shall do business according to  law, be honest, faithful and strictly self-
disciplined, and subject themselves to public supe rvision, and they shall not harm the consumers' 
interests by taking advantage of their position of  control or their exclusive business and sale of 
certain commodities. Therefore, such undertakings shall also abide by the Anti-Monopoly Law, they 
shall not have monopolistic actions such as implementing monopoly agreements, abusing their dominant position in the market, and etc. In th e event that they take monopolistic actions, the 
anti-monopoly authorities will conduct investigation and punishment according to law. Fully proved 
by practices of law enforcement in recent years, the Anti-Monopoly Law of China has given equal treatment to enterprises of various kinds of owners hip, and provided no special protection for any 
of them. 
 
Questions 
Furthermore, three different agencies are currently competent for the implementation of the 
competition act – MOFCOM, SAIC, NDRC. Could the Chinese authorities explain how these three 
agencies collaborate in practice and what are the advantages of having three different agencies in charge instead of only one authority as it is the case in many other countries? Are there plans to 
entrust one single authority with the implementation of the competition act in the future? 
 Answer  
Currently, MOFCOM is responsible for anti-trust reviews on concentration of business operators 
(mainly related to merger and acquisition), NDRC is responsible for price fixing investigation, SAIC 
is responsible for areas, other than price fixing, including monopoly agreements, abuse of dominant market positions and abuse of administrative power which eliminates the competition. In 
addition, the State Council has also set up the Anti-Monopoly Committee, which is responsible for 
organizing, coordinating and guiding anti-monopoly work.  
Since the implementation of the AML in 2008, MO FCOM, NDRC and SAIC continue to promote the 
supporting legislation on anti-trust and actively enforce laws. Based on the current practice, China's anti-trust legislation and enforcement system work well and have effectively maintained competition order in Chinese market. 
 WT/TPR/M/300/Add.1 
 
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 2 Trade and Investment Regime 
2.5 Foreign Investment Regime 2.5.1 Regulatory framework and market access 
Questions 
Para. 2.45  refers to the classification of foreign investment projects into four categories 
(encouraged, permitted, restricted, prohibited). Th e classification changes over time, reflecting the 
goals adopted by the Five-Year Plans (para 2.46). What are the criteria used for the change of 
classification of a sector e.g. from "permitted" to "prohibited" and how do the Chinese authorities 
assess the impact of such reclassification possibilities on the incentives of potential investors to invest in China in the first place? How does such a reclassification impact follow-up investments in 
such a sector concerned (see example "post and telecommunications/domestic express delivery 
services", Table 2.2 Summary of the major changes in the Investment Catalogue)?   
Answer  
The Chinese Government has amended the Catalogue for the Guidance of Foreign Investment 
Industries based on the needs of economic development, with reference to the requirements in 
such aspects as adjustment of national industrial structure and for the purpose of continuing to 
actively and effectively utilizing foreign investment , introducing foreign advanced technologies and 
management experience, enhancing optimization and upgrading of industrial structure and maintaining national economic safety. 
 
For the purpose of adapting foreign investment to China's national economic and social development and protecting legitimate rights and interests of investors, the Chinese government 
promulgated the Guiding the Direction of Foreig n Investment Provisions in 2002, explicitly 
providing for the classification standards of foreig n investment projects and including such foreign 
investment projects as may endanger national safety, damage social and public interests and 
cause environment pollution into the prohibited Catalogue. The Chinese government has 
formulated and amended the Catalogue for the Guidance of Foreign Investment Industries in strict accordance with the Provisions and has sufficiently solicited the reasonable suggestions from stake holders through such methods as seminars and online opinion solicitation, which has fully 
embodied the transparency in China's policy formulation process and provided foreign investors 
with definite guidance on industrial investment.  
In 2011, the Chinese Government amended the Catalogue, further expanding opening-up, 
increasing encouraged items while reducing re stricted and prohibited items, promoting the 
transformation of the manufacturing sector, encouraging foreign investors to invest in the high-
profile manufacturing sector and strategic emerging sector, enhancing the development of the 
service sector, further opening up the service sector and increasing encouraged items for the service sector. The amendment causes the Catalogue to be more consistent with domestic laws, forms a uniform, regulated and transparent guidance on foreign investment access, increases 
investment convenience and create a fair and just  investment environment for foreign investors. 
The amendment to the Catalogue made by the Ch inese Government has steadily promoted the 
open up of the relevant sectors as a whole. Regardless of stricter restrictions on certain sectors, 
the relevant restrictions have no retrospective e ffect, i.e. the enterprises which have been legally 
established may continue to operate after the Catalogue is amended. Where the enterprise continues to expand its investment in the same  sector upon such amendment, the relevant 
investment must comply with the relevant requirements in the amended Catalogue on such 
aspects as industrial policies.  As to "Post and telecommunications: domestic expre ss letter delivery services", no change is made 
in the 2011 amendment and the sector is still in the list of prohibited items. 
 Questions  
Accordingly to para. 2.52 , FDI in form of M&A of enterprises is subject to anti-trust reviews. Are 
similar reviews foreseen for other types of investments like participation in partnership, enterprises or joint ventures? In respect to the re views that analyze possible formations of cartels 
etc., what relevance is given to other business corporations or state owned enterprises? Are these 
actors reviewed at the same time as the M&A of a particular enterprise?   WT/TPR/M/300/Add.1 
 
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 Answer 
According to Article 20 of the Anti-Monopoly Law of China, concentration of undertakings includes 
three situations, the third situation is that undertakings "have the right to control over other 
undertakings or have the ability to exert a decisive influence on the same through signing 
contracts or other means." Therefore, any action that results in the acquisition of the right to control over other undertakings or being able to impose a decisive influence on the other business 
operators, including partnership, joint investme nt, joint control, Sino-foreign joint venture, 
constitutes concentration to the extent of the Anti -Monopoly Law. So long as the business revenue 
of the said concentration of undertakings reaches th e threshold stipulated in the Provisions of the 
State Council on Thresholds for Prior Notification of Concentrations of Undertakings, the 
undertaking shall be obliged to make prior notification. 
 Question 
In para. 2.56 , it is stated that foreign-invested projects are generally, but not always, subject to 
the same requirements as domestic investment projects. Could you please explain in which cases and to what extend additional requirements have to be met?  
 
Answer 
The Chinese Government proposes to unify laws and regulations on domestic and foreign investment and keep policies on foreign investment steady, transparent and predictable, and in 
December 2013, promulgated the State Council Circular on releasing the Catalogue of Investment 
Projects Subject to Government Verification (2 013 version) which stipulates the scope of the 
foreign investment projects subject to examinat ion and approval. In May 2014, NDRC promulgated 
the Administrative Measures for Verification, Appr oval and Filing of Foreign Investment Projects, 
explicitly identifying the verifica tion and approval conditions of foreign investment projects. The 
main verification and approval aspects involve the compliance with applicable state laws and 
regulations, public interests, foreign investment access policies and capital account management. 
The Measures have been implemented since 17 June 2014.  3 Trade Policies and Practices by Measure 
3.1 Measures Directly Affecting Imports 
3.1.4 Tariffs 3.1.4.1 Applied tariffs and tariff structure  
Question 
According to para. 3.14 , "Interim duty rates are lower than the MFN rates and in certain 
circumstances the interim duty rate applies just to part of a tariff line." Could the Chinese 
authorities specify for which products (HS code and product description) the interim duty rate 
applies to just part of a tariff line?  Answer 
Interim duty rates apply to certain merchandise und er the tariff line with "ex" before its tariff in 
the Customs Tariff of Import and Export of China . 
3.1.6 Import prohibitions, restrictions, and licensing  
Questions 
According to para. 3.28 , products subject to import prohibition are listed in the "Catalogue of 
Commodities Subject to Import Prohibitions", issu ed by MOFCOM and other relevant ministries and 
bodies, such as the GACC and AQSIQ. The last notification regarding import prohibitions dates 
from 2009 covering 543 tariff lines at 8 digit level (HS2007). Is this list of prohibited imports still accurate today and if not when does China inte nd to notify such changes? On 22 June 2012 the 
Council for Trade in Goods adopted a revision of the decision on the notification procedures for 
quantitative restrictions (G/L/59/rev.1) according to which all WTO Members had to make 
complete notifications of all quantitative rest rictions in force by 30 September 2012 and at two 
yearly intervals thereafter. According to footnote 48 China last notified its quantitative restrictions 
to the WTO in 2010. Could China indicate when it will submit a complete notification of its 
quantitative restrictions?  WT/TPR/M/300/Add.1 
 
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 Answer 
Currently, China has not maintained any quantitative  restrictions inconsistent with WTO rules and 
China's access commitments. China is working on, and will submit the notification of its 
quantitative restrictions (2010-2014) to WTO soon, which will contain the details of the products 
prohibited from imports after 2009.  
3.1.7  Anti-dumping, counterva iling, and safeguard measure  
3.1.7.1 Anti-dumping measures 
Questions 
In para. 3.36 , the Secretariat's report notes that anti-dumping investigations may be initiated at 
the request of an interested party or may be self-initiated by MOFCOM. In para. 3.37 , the 
Secretariat's report also notes that to self-initiate an anti-dumping investigation, MOFCOM must have sufficient evidence of the existence of dump ing, of injury and of a causal link. Could the 
Chinese authorities clarify how such evidence of the existence of dumping, of injury and of a 
causal link is being gathered if there is no complaint or petition from the affected domestic economy? Could the Chinese authorities indicate how many times the investigating authorities 
used self-initiation during the period under review? 
 Answer  
MOFCOM has not had any practice of self-initiation so far. 
 
In para. 3.40 , the Secretariat's report indicates that the imposition of anti-dumping duties must 
be in the public interest. The Secretariat's report, however, also notes that there are no rules 
stating in which way public interest hast to be taken into account in an investigation. Could the 
Chinese authorities indicate whether they intend to introduce specific criteria to determine whether an anti-dumping measure or duty is in the public interest and, if yes, what these criteria would be? 
 
Answer 
MOFCOM has not formulated any regulations or rules on the criteria for taking into account the public interest in anti-dumping investigations. 
 
3. Measures Directly Affecting Exports  3.2.2 Export taxes, charges and levies  
Questions  
According to para. 3.88 , China applies export taxes. Exports that are subject to interim duties 
may also be subject to a special export duty which is applied according to the season and may be 
substantially higher than interim duty rates. In 2013 for instance, the special export duty rate was 
75%. Could the Chinese authorities indicate for which products (HS code and product description) the special export duty rate is applied and what is their justification? What is the current level of that duty for 2014? 
 
Answer 
There are no products subject to the special expo rt duty rate in 2014 according to 2014 import 
and export tariff. 
 Question 
In addition, para. 3.91  of the Report states that the number of tariff lines subject to export taxes 
has increased in recent years, for both products subject to interim export duty rates as well as those subject to special export duty rates. What is the justification for this increase ? 
 
Answer 
Given the needs of environment and natural resources protection, China imposes export duty on 
certain resources and high energy-consumption products. Generally speaking, the quantity of the 
tariff lines subject to export duties  keeps stable in recent years. 
  
 WT/TPR/M/300/Add.1 
 
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 3.2.4 Export support and promotion  
Para. 3.102  and para. 3.103  
The Secretariat's report outlines that for certai n products, VAT rebates are granted to exporters. 
Could China describe the system of VAT rebate for agricultural products? Are plant products 
benefiting from VAT rebates upon export? 
 
Answer 
In accordance with China's current rules on VAT rebates granted to exporters, most agricultural 
products (including plant products) are entitled to VAT rebates at 5% except endangered animals 
or plants, and a small quantity of processed agricu ltural products such as processed chickens and 
ducks are entitled to VAT rebates at 13%. 
3.2.6 Export finance, insurance, and guarantees  Question 
Para. 3.107  
The status of the China Development Bank (CDB) s eems not entirely clear according to the report. 
The text states that "The China Development Bank (CDB) finances exports but according to the 
authorities, is not an official export finance institution." Could the Chinese authority provide more 
clarity regarding the role of the CDB and explain the reasons why CDB is not considered an official export credit agency? 
Answer 
In 2008, CDB conducted commercialization reforms and basically established the modern financial 
enterprise system and the internal corporate governance structure, under which CDB would realize commercialized operation, operate independently an d assume risks on its own and assume its own 
responsibility for profits and losses under the respec tive leadership of the shareholders assembly, 
the board of directors, the board of supervisors and the senior management. In accordance with the principles determined in the reform in 2008, CDB is positioned to become a commercial bank 
with "sufficient capital, strict internal control, sa fe operation, satisfactory services and efficiency 
and strong creativity and competiveness". Therefor e, CDB should not be considered an official 
export credit agency. 
3.3 Measures Affecting Production and trade  
3.3.2 Competition policy and price controls 
Question 
Para. 3.135   
The Secretariat's report describes that the AML does not apply to enterprises "associated or 
concerted conduct by agricultural producers and rural economic organizations in their business activities (production, processing, sales, transpor tation, and storage of farm products) related to 
agricultural products". How do the Chinese authorities assure that the AML's main objective, to 
safeguard fair market competition, is also applied to the agricultural sector?   Answer 
According to Article 56 of the Anti-Monopoly Law, the Law is not applicable to the association or cooperation by agricultural producers or rural economic organizations in their business activities of production, processing, sale, transportation, st orage of farm products, etc. However, the 
application of the Anti-Monopoly to agriculture is not fully excluded. Pursuant to this Article, only 
some activities of agricultural producers and rural economic organizations do not apply to the Anti-Monopoly Law. Other agricultural enterprises, thos e who have dominant position in the market in 
particular, are still subject to the Anti-Monopoly Law. 
 Question Para. 3.139  states that China is continuing its international cooperation on competition policy 
issues with the competition authorities of other countries or groups of countries. However, 
according to the same paragraph, China is not a member of the International Competition Network and there is no clear timeline for China to consider joining the network. Could the Chinese 
authorities please elaborate on the reasons why it does not consider joining the International 
Competition Network? WT/TPR/M/300/Add.1 
 
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 Answer  
The International Competition Network is an informal international forum, joining the Network or 
not shall be subject to one's free will. Although China has not yet joined the Network, it pays a 
great attention to international exchanges and cooperation in the field of anti-monopoly, and has 
achieved positive effect. For example, National Development and Reform Commission (NDRC) has signed MOUs on Cooperation with law enforcing authorities on anti-monopoly of the UK, the U.S., 
Rep. of Korea and the EU, agreed on contents and approaches of cooperation, and established 
long-term effective mechanisms. Meanwhile, through paying visits to each other, organizing and participating in relevant international worksh ops, NDRC has enhanced exchanges with law 
enforcing authorities on anti-monopoly of other countries and solicited experience and learned 
practices in anti-monopoly from mature market economies  
 3.3.3 State trading, state-owned enterprises, and privatization 
Questions 
Para. 3.172  state that export products subject to state trading and the enterprises in charge of 
trading these products have not changed substantially since the last TPR. Could China indicate 
what these non-substantial changes since the last TPR were? Does China envisage liberalizing 
these markets further?  Answer  
The state trading regime of China, including th e products covered and the list of state-trading 
enterprises, has not seen major changes since the 2003 notification G/STR/N/9/CHN/Add.1, except that a couple of products were no longer subject to the state trading regime.  
 
Para. 3.172 , para. 3.174 and Table 3.17:  
The Secretariat's report outlines in para. 3.172  that "Imports subject to state trading continue to 
comprise: grain (including wheat, maize, and ri ce), sugar (…)" and in 3.174 that "The state-
trading enterprises themselves determine the pric e of the goods that they export". Could the 
Chinese authorities explain which measures it is taking to assure that the price-setting power of China National Cereals, Oil and Foodstuffs Import  & Export Co. (renamed as COFCO in April 2007); 
and Jilin Grain Group Import & Export Co. Ltd. is not used in such a way to influence world market 
prices?   
Answer 
COFCO and Jilin Grain Group Import & Export Co. Lt d. are state trading enterprises, authorized to 
carry out the import and/or export trading of the products listed in Exhibit 2A of the PROTOCOL 
ON THE ACCESSION OF THE PEOPLE'S REPUBLIC OF CHINA. Different from the state trading 
enterprises in some other members, the operatio n of China's state trading enterprises will not 
interfere with the market because such enterprise s are operated in a market-oriented way. They 
will adjust or change the volume and schedule of import and export themselves based on the 
changes with the demands and supplies in the international market and prices. Such state trading 
enterprises may carry out the import and/or export trading of the products listed in Exhibit 2A of 
the PROTOCOL ON THE ACCESSION OF THE PEOPLE'S  REPUBLIC OF CHINA. State trading in China 
itself is irrelevant to such enterprises' operation and pricing capability. 
4 TRADE POLICIES BY SECTOR 
4.1 Agriculture  
4.1.3 Policy instruments  
4.1.3.2 Internal measures  4.1.3.2.1 Support measures  
Questions 
Para. 4.25 
The Secretariat's report describes that the "centrally funded comprehensive subsidy on agricultural inputs" compensates agricultural producers for input price increases. Could the Chinese authorities 
outline how the program works and who is benefiting? Is the program set up for specific farmers 
(such as e.g. farmers below a certain income level) or is it applicable for every farmer planting the commodity in question? 
 WT/TPR/M/300/Add.1 
 
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 Answer 
Comprehensive subsidy on agricultural inputs is a support provided to all producers. The general  
objective is to help the farmers cope with rising prices of fertilizers, diesel and other means of 
production. The programme started in 2006, and fund is paid directly to the farmers' bank 
accounts. Local government are responsible for the operation of the programme. China has notified the relevant information about the comprehensive subsidy on agricultural inputs 
in its SCM notification details please refer to Program 62 of G/SCM/N/155/CHN and 
G/SCM/N/186/CHN. This programme has also been included in the notification on domestic agricultural supports submitted by China to WTO. WT/TPR/M/300/Add.1 
 
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 8  PREGUNTAS DEL GOBIERNO DE COLOMBIA  
Informe del Gobierno de China WT/TPR/G/300 
 
2.3.3. Pursuing innovation-driven developm ent and protecting intellectual property 
rights   
El párrafo 2.25 del informe de China indica que… "China has been pursuing a long-term 
development strategy that pivots to innovation. Constant innovation is deemed as a genuine power for adjusting and upgrading economic structure. It is of great significance for China to highlight the importance of innovation at this epochal period of reform and transformation. The 
Chinese Government is committed to further promoting synergy between scientific innovation and 
economic development, expediting the establishm ent of a new technological innovation system 
that is business-centered, market-oriented and facilitates the combination of industry, academia 
and R&D institutions. China will continue to relentlessly promote the protection of intellectual 
property rights and make great efforts to foster a favourable market environment and an effective 
system that drives China's innovation. 
 
Pregunta 1 En cuanto a este nuevo Sistema de Innovación Tecnológica ¿Cuáles son los mecanismos para combinar industria, academia e instituciones de investigación y desarrollo?  
 
Answer 
Since the implementation of the national planning of scientific and technological development, 
Chinese enterprises have strengthened their abil ity in technology innovation, the cooperation 
mechanism between academy, research and indust ry has been enhanced, and the business-driven 
technological innovation system has made positive progress.  
 
Firstly, to refine the mechanism to encourage the enterprises to increase their investment in R&D. As we put in place new enterprises-driven institutions and mechanisms of R&D and innovation, enterprises can play a leading role in decision-making on technological innovation, investment in 
R&D, corporation with sci-tech organizations, and commercialization of these research outcomes.  
 Secondly, to explore new cooperation mechanism to better integrate research, academy and 
industry. We encourage key industries and enterprises to sign strategic corporation initiatives with 
scientific research institutions, colleges and universities. In addition, we establish strategic alliance for industrial technological innovation, and put in place a mechanism that could promote the 
industry-academy-research cooperation to share the investment, advantages, interests and risk.  
 Thirdly, to make sci-tech resources more accessible to businesses. In this connection, we create an 
information service platform for businesses' technical innovation so as to keep us informed of the 
new developments and technological dema nds of enterprises in this regard. 
 Fourthly, to upgrade the financing and funding support for technological innovation, in particular 
for small and medium hi-tech enterprises.  
 El párrafo 2.26 del informe de China señala que... "Since its last review, the Chinese Government 
has continued to strengthen its law enforcement in  the IPR protection and the construction of a 
long-term mechanism. China's newly-elected govern ment retained the National Leading Group on 
the Fight Against IPR Infringement and Counterfeiting headed by a vice premier of the State Council. The government is also pushing forward the initiative to incorporate the outcomes of IPR 
protection against infringements and counterfeits into government performance evaluation system 
at different administrative levels. Thanks to China's constant and highly aggressive law enforcement, IPR infringements and the manufactu ring or selling of counterfeiting commodities 
have been effectively suppressed". 
 WT/TPR/M/300/Add.1 
 
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 Pregunta 2 
En relación con la expresión "(…) IPR infringements and the manufacturing or selling of counterfeiting commodities have been effectiv ely suppressed (…)" esto significa que el 
contrabando ha sido suprimido en un ciento por ciento (100%)? Hay estadísticas oficiales que 
muestren esto?   
Answer 
Since the last Review, China have done more in IPR protection and carried out special programs 
against the illegal counterfeiting activities, including the pressing infringements of trademark right, copyright, patent right. Beyond that, we also cracked down on infringements and privacy on 
internet and rolled out the programs to undertake law-enforcement on cases of patent right. In 
2012 and 2013, all together 500,000-plus relevant cases have been broken and investigated by competent law-enforcement departments, which curbed the IPR infringements. At the same time, 
we have phased in a long-term mechanism to achieve the objective. In addition, We have revised 
laws and regulations, such as" trademarks law", "regulations on how to implement the trademarks law", "Protection of Computer Software Regula tions", "Regulations on how to implement the 
copyright law", "Regulation on the Protection of the Right to Network Dissemination of 
Information" "regulations of protection of new variety of plants". We also issued judicial interpretation s on such laws as the provisions on several issues concerning laws applicable to civil 
disputes on the trail of infringement of network dissemination of information. We have made law-
enforcement more integrated with judicial interp retation. In two years, more than 9,000 cases of 
alleged crimes have been transferred to relevant departments.   
El párrafo 2.27 del informe de China señala que ... "On 1 January 2013, the Regulations on Several 
Issues Concerning the Laws Applicable to the Trial of Civil Cases of Dispute on the Infringement of the Right of Communication through Information Network promulgated by the Supreme People's 
Court took effect. China also amended a series of laws, regulations and rules concerning 
intellectual property rights such as the Tradem ark Law, the Regulations on the Protection of 
Computer Software, the Regulations on the Implem entation of the Copyright Law, the Regulations 
on the Protection on the Right of Communica tion through Information Network, and the 
Regulations on the Protection of New Plant Va rieties. The amount of compensation for IPR 
infringements has been raised, which is to the benefit of strengthening the administrative sanction and criminal punishment against IPR infringements."  
 
Pregunta 3 Sobre el aumento de las compensaciones por violación de derechos de propiedad intelectual, 
existe un monto mínimo para la compensación , particularmente en material de marcas?  
 Answer 
On 1 May 1 2014, we have implemented the revised version of trademarks law which adds the 
provision to raise the compensation for infringements. With regard to those serious infringement of 
trademarks right, the compensation fee could be one to three times as high as the losses of the 
rightholders, the interests of infringers, or the lic ense fee of registered trademarks. If the three-
above basis cannot be identified, the court could raise the compensation fee up to from RMB 
500,000 yuan to RMB 3 million yuan. In line with th e trademarks law, we don't set the lower limit 
of compensation fee. 
 
Pregunta 4 ¿Existen dos regulaciones diferentes para derecho de autor y programas de ordenador (software)?  
Answer 
China protects computer software through copyrigh t regime. Given the special feature of computer 
software, the Chinese Government enacted the Regulations on the Protection of Computer 
Software under the Copyright Law in 1990s. Currently, the Government is considering whether to 
incorporate this Regulation in the Copyright Law during its revision. WT/TPR/M/300/Add.1 
 
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 El párrafo 2.28 del informe de China señala que ... "In addition, the Chinese Government continues 
to proactively carry out the public legal education on IPR across community and society. It organizes publicity and educational activities on special observance days such as the World 
Intellectual Property Day and the National Law System Publicity Day. News media is encouraged to 
cover typical cases on IPR infringement and counterfeiting activities in order to be responsive to concerns of the general public. The court trials of IPR cases are broadcast online, and the relevant 
information on those cases are publicized in accordance with legal requirements and procedures. 
These efforts will effectively involve the entire society to participate in IPR protection, meanwhile, law enforcement and judicial actions will be subject to public scrutiny. Thus, those proactive efforts are conducive to help maintain a fair and competitive market order."  
 
Pregunta 5 Sobre la educación en derechos de propiedad intelectual ¿las actividades educativas solo son 
desarrolladas el Día Mundial de la Propiedad Intelectual y el Día Nacional del Sistema Legal de 
Publicidad? ¿Cuáles son los mecanismos que utiliza el Gobierno Chino para medir el impacto de estas medidas educativas? 
 
Answer 
The Chinese Government has publicity and educational activities of IPR protection on daily basis, in 
particularly, focusing on some key timing, includ ing Spring Festivals, National Day, National 
meetings, International Day for Protecting Consumers' Rights, World Intellectual Property Day, and 
the National Legal Awareness Day to lunch outreach campaign, issue official information, and provide feedback to the concern of the public. We have made full use of the Government websites 
of various regions and departments to promote the interaction and communication between the 
government and the enterprises, consumers and IP right holders.   
3.2.1. Striving to balance gr owth of imports and exports  
 El párrafo 3.21 del informe de China indica qu e... "In addition, the Chinese Government has 
actively carried out trade promotion activities, made efforts to enhance multilateral and bilateral 
communication and cooperation, and to improve the public service. It has entrusted trade 
promotion institutions to organize import procurement and support various industries and enterprises to carry out trade promotion activities abroad. It has also encouraged those well-
known exhibitions and fairs to expand their functions into import field, and to attract trading 
partners to China for holding exhibitions and carrying out business negotiations. The Chinese government has built public service platforms for foreign trade promotion and strengthened 
information disclosure, trade policy introduction, information consultation, trade barrier complaint 
and intellectual property right protection. At the end of 2013, the Chinese import promotion 
website http://www.import.org.cn started its trial operation."  
 
Pregunta 6 
¿Qué clase de información contiene el servicio público de plataformas construido por el Gobierno Chino sobre protección de derechos de propiedad intelectual?  
 
Answer 
Please, refer to http://www.import.org.cn. 
 
El párrafo 3.25 del informe de China señala que… "China advanced the strategy of "win by good 
quality" and further imposed more requirements on quality and safety of exported goods. The 
Chinese Government actively carried out relevant activities such as the "Year of Enhancing Goods 
Quality in Foreign Trade" and the special campaigns to crack down on the counterfeit and fake 
goods and products with infringement of intellectual property rights exported to Africa so as to enable the enterprises to focus on the quality of their products, and thus improve the quality of 
goods.  
 Pregunta7 
¿Qué clase de programas implementa el Gobierno  Chino para contrarrestar las exportaciones de 
contrabando y de bienes falsificados que vulneran derechos de propiedad intelectual? ¿Por qué solo con África?  WT/TPR/M/300/Add.1 
 
- 49 - 
 
  
 Answer 
When cracking down on the prohibited goods fo r export and the counterfeit and fake goods and 
products with infringement of intellectual proper ty rights, the Chinese Government has responsibly 
adopted a series of positive measures. We have strengthened inspection and quarantine of 
exported goods, actively launched campaigns of customs intellectual property right protection, intensified effort in application of risk analysis technology and investment in technological check  
device, consolidated surveillance and investigation on industrial and regional risk clues, and have 
strictly investigated goods that are suspected of  infringing upon intellectual property rights 
registered at the customs. In addition, China has sorted and rectified collecting and distributing centres of exported goods to promote quality improvement of regional products, and has launched 
cross-border cooperation to join hands with countries concerned to crack down infringement of 
intellectual property rights, counterfeit and fake good and illegal criminal activities.  
 
i) Trade policy framework and objectives  
 
El párrafo 3.36 del informe de China indica que... "Then, the People's Government of 
Shanghai Municipality promulgated the Sp ecial Administrative Measures of China 
(Shanghai) Pilot Free Trade Zone for Admittance of Foreign Investments (Negative List) (2013) and temporarily adjusted 11 administrative examination and approval items regulated by three laws including the Law of the People's Republic of China on Wholly 
Foreign-owned Enterprise, and 32 administrative examination and approval items or 
special administrative measures for admittance of foreign investment regulated by 15 administrative regulations and three administrative measures issued by the State Council 
within the free trade zone. China carried out reforms in current approach of approval and 
examination for foreign investment projects and explored the management model of "Pre-establishment National Treatment (PENT) with a Negative List was introduced" as 
authorized by the 4th Session of the Standi ng Committee of the 12th National People's 
Congress and determined by the State Council. The foreign investment projects which are not covered in the Negative List will, according to the principle of treating domestic and foreign investors on an equal basis, be subject to the filing instead of verification (except 
verifications retained for domestically invested projects as stipulated by the State Council), 
and the contracts and articles of association of foreign invested enterprises are subject to filing instead of examination and approval. By March 2014, newly established and changed 
foreign investment subject to filing administration ，which are not covered in the negative 
list amounted to 93% of all applications for foreign investment, thus a filing-based foreign 
investment administration system has taken shape initially."  
 Pregunta 8 ¿Cuál sería el mecanismo o instrumento que se empleará para la implementación del modelo 
presentado de "Trato Nacional con pre-establecimiento introducido en listas negativas"? 
 Answer 
By promulgating the Special Administrative Meas ures of China (Shanghai) Pilot Free Trade Zone 
for Admittance of Foreign Investments (Negative List) (2013), the Procedures on the Filing Administration of Foreign Investment Enterprises within the China (Shanghai) Pilot Free Trade 
Zone and the Procedures on the Filing Administration of Foreign Investment Projects within the 
China (Shanghai) Pilot Free Trade Zone, the People's Government of Shanghai Municipality identifies the scope and procedure of filing. The im plementation of filing will be the responsibility of 
the administrative committee of China (Shanghai) Pilot Free Trade Zone 
 
El párrafo 2.25 del informe de China... "Regarding the CSPFTZ, the goal is to unleash the benefits of reform and opening up through innovation in the governmental administration system. The aim 
of launching the pilot programme on changing the functions of government, reforming investment 
areas, facilitating trade and reforming finance sectors is to provide replicable and expandable experience for the new round of reform. CSPFTZ issues a Negative List for foreign investment; 
foreign investment in the sectors outside the Negative List will be subject to filing procedures 
instead of approving procedures, which significantly simplifies the process."   WT/TPR/M/300/Add.1 
 
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 Pregunta 9 
¿Qué implica "filing procedures" como ventaja real frente a los procedimientos de aprobación de inversiones en los sectores por fuera de la lista negativa? 
 
Answer 
It will provide more convenience for foreign investment.  
El párrafo 2.42 del informe de China señala que... "China's policy towards foreign investment has 
been to encourage direct inward FDI as well as joint ventures between Chinese and foreign companies, particularly with regard to R&D activi ties. FDI has been encouraged in areas such as 
high-end manufacturing, high-tech industries, se rvice industries, new energy and energy-saving 
environmental protection industries. The authorities have noted that China actively guides foreign 
investment in the central and western regions."   
Pregunta 10 
¿Qué mecanismos se han empleado para promov er los "joint venture" entre las empresas 
extranjeras y las locales? 
 
Answer 
The Chinese Government has issued Provisions on Guiding the Direction of Foreign Investment and classified part of foreign investments into encour aging type, which have been clearly identified in 
Catalogue of Industries Guiding Foreign Investment. To make Middle and West China more 
effective in attracting and tapping the foreign investment, Chinese government has for the first 
time in 2000 developed and delivered on the Ca talogue for the Guidance of the Advantageous 
Industries in Central and Western Regions for Foreign Investment and also made revisions in line 
with the local conditions. We now go about the revised version of 2013. To encourage more Sino-foreign joint ventures, we also adopted the Catalogue for the Guidance of the Advantageous 
Industries in Central and Western Regions for Foreign Investment so as to guide them in policies. 
Meanwhile, we encouraged businesses to strengthen cooperation based on businesses principles to achieve shared development.   
El párrafo 2.50 del informe de China… "Betw een 2012 and 2013, the State Administration of 
Foreign Exchange (SAFE) took measures aiming at simplifying rules governing FDI in China and easing restrictions on the use of capital for direct investments. The SAFE abolished 24 regulations 
containing requirements on foreign exchange re gistration and the opening and use of accounts; 
and introduced new rules focusing on simplified  procedures and regulations for foreign currency 
registration, the opening and use of accounts, as well as the receipt and disbursement of capital 
and settlements. The restrictions on reinvestment in RMB for foreign companies were abolished. 
FIEs are now allowed to extend loans to offshore shareholders, although restrictions are still in place on the amount of such loans."  
Pregunta 11 
¿Se han adoptado algunas medidas o políticas en relación con la simplificación normativa para la promoción de la inversión China en el exterior? Si la respuesta es afirmativa, por favor describir. 
 
Answer 
In recent years, the Chinese Government attaches great importance to the work of facilitating 
overseas investment and issued the Measures on the administration of overseas investment. 
Ministry of Commerce only keeps the verification requirement for application regarding overseas investment of great importance and involving interests of more than one country, and specific countries or regions or those without diplomatic relationship with China. China will further deepen 
the reform of examination and approval system for foreign investment.  
4.2. Services  4.2.1. Telecommunication Services  
4.2.1.1. Market overview  
4.2.1.2.2. Number portability   
El párrafo 4.41 del informe de China señala que… "Since November 2010, the MIIT has been 
carrying out successful mobile number portability tests in Tianjin municipality and Hainan province on 83,000 users. The scope of the test will be enlarged in 2014."   WT/TPR/M/300/Add.1 
 
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 12. Cuál es la reglamentación de China sobre portabilidad numérica para Telefonía fija? Existe 
actualmente la portabilidad para telefonía fija?   
Answer 
As we have made nationwide study on the demand for fixed phone number portability , it indicates 
that the demand is not sufficient to put in place relevant services and policies. In order to prepare 
for the work of mobile number portability, we have implemented some trial programs in some 
regions.   El párrafo 4.46 del informe de China señala que...  "All but one (Internet data centre) of the eight 
value-added telecommunication services categories have been liberalized as of March 2014 in the 
context of the China (Shanghai) Pilot Free Trade Zone (CSPFTZ), under the following conditions:  
  for domestic multiplayer telecommunications services, storage and forwarding business, 
call centres, Internet access services and th e appstores segment of information services, 
wholly foreign-owned companies are now allowed;  
  for online data processing and transaction processing, the maximum foreign participation 
is raised to 55% except for the e-commerce segment (previously closed to foreign investment) where it is raised to 50%; IP and VPN business as well as information services other than appstores are also subject to a threshold of foreign ownership raised to 50%;  
  companies established in the CSPFTZ will be allowed to provide their services from the FTZ 
to the entire territory of China except for Internet access services whose geographical 
scope will be limited to the CSPFTZ."  
 
Pregunta 13 ¿Cuáles son los servicios de valor agregado liberalizados y cuál es el que aún se mantiene cerrado? 
 
Answer 
We have deregulated the value-added items in telecommunications services listed in the China's GATS schedule, and will lift more restrictions as the domestic market evolves. China stands ready 
to have negotiation with Colombia on further deregulations of the telecommunication service 
within the framework of the Doha Round.   
Informe de la Secretaría WT/TPR/S/300  
 RESUMEN 
 
El Párrafo 12 del informe de la Secretaría señala que… "La política comercial y de inversiones de China se administra y ajusta mediante varios instrumentos jurídicos, entre ellos los Planes Quinquenales del Gobierno Central, los Planes quin quenales sectoriales y provinciales, y diferentes 
catálogos que orientan la aplicación de las políticas generales y en los que se enumeran las 
industrias que pueden recibir trato preferencial y los sectores en los que se fomenta, se permite simplemente, o se prohíbe la inversión. No siempre está claro cómo deben interpretarse los 
diferentes catálogos, ya que a veces se superponen e incluso están en contradicción como 
consecuencia de los diversos programas existentes a los diferentes niveles. Los distintos niveles de reglamentación hacen que resulte aún más difícil tratar de identificar las medidas de política 
específicas que se aplican en China". 
 Este párrafo nos permite interpretar que la política comercial y de inversiones de China es muy complicada para empresarios y funcionarios de gobiernos de otros países.  
 
Pregunta 14 ¿Podría el Gobierno de China indicar si está de acuerdo con esta afirmación? En caso afirmativo, 
¿El Gobierno de China tiene proyectado establecer algún mecanismo para identificar las normas 
que en materia de comercio e inversión se contradicen o contraponen, o un mecanismo para aclarar las interpretaciones de empresarios e inversionistas que encuentran estas dificultades? 
 
Answer 
Chinese government has proposed to put in place an open, unified and well-regulated market system to keep foreign investment policies stable, transparent and anticipatory. China's WT/TPR/M/300/Add.1 
 
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 management on the market access for foreign investment mainly focus on project approval and 
enterprises setups. The State Council has mapped out notices on the management system, policy  
orientation and project approval system for foreign investment. Among them are Provisions on 
Guiding Direction of Foreign Investment and Catalogue of Investment Projects Subject to 
Governmental Verification (2013). We also identified laws and regulations on the legal position and setup procedures for foreign-invested enterprises. Among them are the Chinese-foreign Equity 
Joint Ventures, the Chinese-foreign Contractual En terprises, Law on Foreign Capital Enterprises, 
The Management on the Joint Ventures by Foreig n-Funded Enterprises or Foreign Citizens. The 
Catalogue for The Guidance of Foreign Investment Industries is the main policy guidance for foreign investment, and the 2011 revised version is what underpins our work. All these above-
mentioned circulars are all accessible to the public. Governments at all levels have set up service 
agencies for guiding consultancy for entrepreneurs and investors.   
El párrafo 19 del informe de la Secretaría indi ca que... "Se mantienen licencias, restricciones y 
prohibiciones de importación por los siguientes motivos: seguridad del Estado; moral pública; protección de la salud de las personas y los animales y preservación de los vegetales; protección 
del medio ambiente; balanza de pagos; y cumplimiento de los compromisos internacionales. China 
utiliza licencias automáticas y no automáticas. Los productos sujetos a cualquiera de esas restricciones se enumeran en los catálogos publicados por los organismos competentes. Ahora bien, esas listas pueden modificarse cuando es necesario, y las autoridades competentes pueden 
restringir o prohibir temporalmente la importación de mercancías no incluidas en ellas."  
 Pregunta 15 
En muchas partes de este examen de política comercial se hace mención a los "catálogos". Por lo 
tanto, quisiéramos preguntar al Gobierno de China, ¿Cuál es el estatus jurídico de los denominados "catálogos"? ¿Qué trámites surte la "aprobación" de un "catálogo" en el contexto 
jurídico de China y qué trámites surte la apro bación de una modificación de un "catálogo"? 
  Pregunta 16 ¿Cuál es el "procedimiento para la elaboración" y el "procedimiento para la modificación" de los 
"catálogos"? Esto con el fin de saber si el sector privado de china o de otros países o los gobiernos 
de otras naciones participan o podrían participar en la elaboración o modificación de catálogos relativos a los temas de comercio e inversión, entre otros. 
  
Pregunta 17 ¿Los "catálogos" tienen plazos para su entrada en vigencia, por lo menos los que tienen que ver 
con temas comerciales? ¿Con cuánto tiempo de antelación a su entrada en vigencia son puestos en 
conocimiento público? ¿Los "catálogos" relativos a temas comerciales son traducidos al inglés?  Answer  
In terms of foreign investment, the Chinese Govern ment issued "Provisions on Guiding Direction of 
Foreign Investment" in 2002, which stipulates that we should refer to the provisions in the Catalogue for The Guidance of Foreign Investment Industries and Catalogue for the Guidance of 
the Advantageous Industries in Central and Western Regions for Foreign Investment when 
approving of foreign-invested projects and enterpri ses. Since its first enaction of the catalogue for 
the guidance of foreign investment industries in 1995, it has gone through five revisions. The 2011 
revised version is currently employed. On the other hand, Catalogue for the Guidance of the 
Advantageous Industries in Central and West ern Regions for Foreign Investment also has 
undergone 3 revisions since its first enaction in 2000. The 2013 revised version is currently employed. In accordance with economic growth  and the demand of reform and opening up, 
Chinese government would make relevant revisions to above-mentioned two catalogues in light of 
special conditions, and then make the revised catalogues public before the government is responsive to stakeholders' interests so as to draw up drafts, solicits public input within one month 
notice period and gives full consideration to the valuable recommendations from the foreign 
enterprises and governments. The industry catalogue is an integral part of the national industrial 
policy. It is generally proposed by relevant la ws and regulations or determined by the State 
Council, and then formulated by competent depart ments. The catalogue falls into the regulatory 
circulars, and thus should be complied with by market entities of all kinds. As we deepened the reform, the formulation and revised procedure of this catalogue are transparent when the WT/TPR/M/300/Add.1 
 
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 government departments would solicit public input from such avenues as internet so that market 
entities of all kinds could voice their opinions with 1-month notice period.   
El párrafo 26 del informe de la Se cretaría señala que... "China mantiene a nivel sectorial, regional 
y de empresas un gran número de programas de ayuda a fin de alcanzar diferentes objetivos económicos y sociales. Esos programas comprenden desde medidas destinadas a lograr 
importantes objetivos de política (por ejemplo, el crecimiento económico) hasta medidas 
encaminadas a impulsar ramas de producción específicas, pero están interrelacionados. Su aplicación no siempre es transparente. En el cont exto del presente examen, la Secretaría no ha 
podido identificar todos los programas, ya que a menudo las medidas de ayuda específicas son 
resultado de medidas administrativas internas que no siempre es fácil identificar y que 
generalmente solo están disponibles en chino. Además, el presupuesto no es un documento público, por lo que no es posible determinar los desembolsos realizados. También se presta ayuda 
a través de diferentes me canismos financieros."  
 Pregunta 18 
Este párrafo destaca que la aplicación de los "programas de ayuda" o "medidas de ayuda 
específicas" no siempre es transparente. ¿Podría el Gobierno de China indicar si considera que por lo menos en parte esta afirmación es cierta?  
Answer 
China does not accept the above statement. The ma in reason is that in recent years, China has 
made significant progress in budget and final accounts disclosure at both central and local 
governments, and is still work hard to strength en its budget transparency. In 2014, the central 
government bodies further enlarge the disclosure scope of department budgets.   
Pregunta 19 
¿Cómo el Gobierno de China puede evitar que lo s mencionados "programas de ayuda" no sean 
subvenciones a la exportación, siendo ese país el mayor exportador de bienes manufacturados del 
mundo? 
 
Answer 
As a Member of the WTO, the Chinese Govern ment strictly fullfils its commitment in WTO 
accession and does not grant any export subsidy.  
 2 RÉGIMEN COMERCIAL Y DE INVERSIONES  
2.2 Marco y objetivos de la política comercial  
2.2.2 Objetivos de la política comercial   Generalidades en materia de Defensa comercial 
 
En el informe se aprecia que China sigue siendo un gran exportador y principal comercializador del mundo, como se ve en el acápite de Comercio de Mercancías, toda vez que su balanza comercial 
con el mundo siguió superavitaria en 2013 (US$2.21 billones en exportaciones Vs. 
US$1,95 billones en importaciones). Esto, de entrada, permite prever que tiene altas probabilidades de continuar siendo el país al que más se le aplican medidas antidumping en la 
OMC.  
 Así mismo, se percibe que anuncian avances hacia una economía de mercado en China, dado que informan estar trabajando desde el gobierno en  promover el libre juego del mercado en la 
asignación de recursos. 
 En materia de Defensa Comercial, China declara no haber modificado su legislación relevante. El 
marco legal para investigaciones Antidumping está previsto en la Ley de Comercio Exterior. Entre 
2010 y 2013 los derechos antidumping impuestos disminuyeron levemente pasando de 117 a 113; se aumentó levemente la duración de los derechos aplicados a 6 años, dadas las prórrogas 
autorizadas luego de las revisiones de final de período; así como la iniciación de investigaciones, 
de las cuales en el 60% se aplicaron medidas provisionales. En cuanto a derechos compensatorios, China inició sólo unas 3 investigaciones en 2012 contra EE.UU y la U.E, al pasó que no inició investigaciones de Salvaguardias del GATT en el período del informe.  WT/TPR/M/300/Add.1 
 
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El párrafo 2.20 del informe de la Secretaría indica que… "El objetivo general de la política comercial de China es acelerar su apertura al  exterior. La Tercera Sesión Plenaria del 18º 
Congreso Nacional del Partido Comunista de China, celebrada en noviembre de 2013, aprobó la 
Decisión sobre ciertas cuestiones fundamentales relacionadas con un proceso de reforma completa y profunda. La Decisión insta a crear un sistema de mercado unificado y abierto con una 
competencia ordenada que desempeñará un papel decisivo en la asignación de los recursos. La 
Decisión insta asimismo a reformar las empresas estatales y establece nuevas normas y metas para fomentar la propiedad privada; el objetivo es modernizar el entorno empresarial y diversificar la propiedad…"  
 
Señala, además  
El párrafo 2.22 del informe de la Secretaría indica que… "Los diferentes departamentos del 
MOFCOM se ocupan de los aspectos relativos a la reforma del comercio y de la política comercial. Entre los cambios previstos cabe mencionar los siguientes: a) promover una reforma del sistema 
de comercio y distribución mediante la modificación de los reglamentos comerciales y reforzar el 
marco jurídico en que operan las empresas; b) reformar el régimen de inversiones (entradas y salidas de inversiones) para hacerlo más abierto, transparente y previsible; c) acelerar la aplicación de los acuerdos de libre comercio; d) acelerar el desarrollo de la Zona Franca 
Experimental (Shanghái) de China (CSPFTZ); y e) acelerar la reforma destinada a abrir las zonas 
internas y fronterizas."   
Pregunta 20 
¿En qué sentido las modificaciones anunciadas redundarán en beneficio de formación de precios locales que puedan ser comparables con sus precio s de exportación, particularmente para efectos 
de las investigaciones antidumping promovidas en contra de las importaciones China's?  
 Answer 
After more than 30 years of reform and opening- up, China has transformed into market economy, 
and set up complete market economy system. The Government doesn't interfere with enterprises' 
production and operation. The enterprises play cent ral role in market competition, with absolute 
self-operation and management over their gain and loss. In addition to only a few products, the 
domestic price of Chinese product is determined by  market mechanism, which fully reflects market 
demand-supply relation, and the production cost, sale s cost and profit of enterprises. In terms of 
comparable anti-dumping price under investigation, such price can and shall be used as basis for 
comparing with its export price. Thus it can be seen that the so-called "local price comparable to 
export price" in the question has been completed ahead of the existing reform measures.   Pregunta 21  
¿En qué forma o sentido el gobierno chino está avanzando en el camino de llegar a ser una 
economía de mercado, en los términos de la sección 15 de su Protocolo de Adhesión a la OMC, cuya fecha límite de su período de transición se vence en 2016?.  
 
Answer 
The Article 15 of the Protocol on the Accession of  the People's Republic of China only allows for 
using data of "alternative countries" in assessing the cost and domestic price of China's export 
products during anti-dumping investigation, rather than passing judgment on China's overall economy regime. In fact, after more than 30  years of reform and opening-up. China has 
transformed into market economy, and set up complete market economy system. So far, 
81 countries and regions have acknowledged China's complete market economy status, most of 
whom are WTO Members. China's market economy status is generally recognized in the world and among WTO Members. 
 
3 POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS  3.1 Medidas que afectan directamente a las importaciones  
3.1.6 Prohibiciones, restricciones y licencias de importación  
 El párrafo 3.30 del informe de la Secretaría indi ca que... "La legislación china también autoriza a 
las autoridades a restringir las importaciones para favorecer el establecimiento de una rama de WT/TPR/M/300/Add.1 
 
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 producción nacional específica o para acelerar su desarrollo. Las importaciones de productos 
agrícolas, de origen animal y pesqueros también se pueden restringir cuando las circunstancias lo exijan (artículo 16 de la Ley de Comercio Exterior). Según las autoridades, esta disposición no se 
ha aplicado nunca."  
 Pregunta 22 
Nos gustaría que el Gobierno Chino enumere los casos que son amparados por la anterior Ley cuyo 
fin es restringir las importaciones de productos agrícolas y pesqueros para favorecer el desarrollo del sector agropecuario y pesquero chinos.   
Answer 
China has imposed no restriction on the imports of farm produce and fisheries products.  
 
3.1.7 Medidas antidumping, compensatorias y de salvaguardia  
3.1.7.1 Medidas antidumping   
De hecho, no se advierten novedades respecto de la adhesión de China a la OMC, particularmente 
respecto de las condiciones y compromisos contenidos en su Protocolo de Adhesión. Sin embargo, se mencionan algunos avances en la profundización de la adhesión de China a la OMC por vía de 
incrementar su participación en algunos instrumentos del sistema OMC.  
 
El párrafo 3.46 del informe de la Secretaría señala que…"En virtud del artículo 56 del Reglamento Antidumping, las autoridades pueden adoptar las medidas correspondientes cuando un interlocutor 
comercial impone "de manera discriminatoria" medidas antidumping a exportaciones de China. Sin 
embargo, las autoridades han reiterado durante el presente examen que China no ha aplicado el 
artículo 56 y que, antes de adoptar las medidas correspondientes con respecto a un Miembro de la 
OMC, China recurriría a las disposiciones pertinentes de la OMC en materia de solución de 
diferencias."   Pregunta 23 
¿Cuál es el alcance del Artículo 56 del Reglamento Antidumping?  
 Answer 
According to the Article 56 of China's Anti-dumping Regulations, for any countries (regions) adopting discriminative anti-dumping measures ag ainst China's export product, China shall take 
countermeasures against these countries (regions) in light of actual condition. 
 
Pregunta 24 ¿Se estima compatible con las disposiciones del Acuerdo Antidumping (Art. 17)? Por favor, aportar una explicación más amplia de su alcance. 
 
Answer 
This article has no direct connection with the Article 17 of WTO anti-dumping, nor does it violate 
this article. China has clarified that, as a WTO member, China will resort to WTO rules for dispute 
settlement before taking counter measures.   
El párrafo 3.52 del informe de la Secretaría señala que... "Entre 2011 y el final de 2013, se 
iniciaron 30 exámenes por extinción y seis exámenes intermedios. El número de investigaciones sujetas a examen por extinción representaba alrededor del 62,5% de las medidas antidumping que expiraron durante el período (30 de 48). Además, 17 órdenes expiraron entre 2011 y 2013 sin 
que se realizara un examen y cinco dejaron de aplicarse porque se rechazó la solicitud, debido a 
que el solicitante no había aportado pruebas suficientes.[3] Ninguno de los 21 exámenes realizados en 2011 y 2012 concluyó con la revocación de las medidas; en todos los casos se 
prorrogó la aplicación de derechos antidumping. Los dos exámenes intermedios que el 30 de junio 
de 2013 ya habían concluido habían dado lugar a la aplicación de derechos antidumping. En octubre de 2012 se inició un nuevo examen de nuevos exportadores en relación con los 
automóviles de turismo y los vehículos todo terreno de cilindrada superior a 2.500 cm3 
procedentes de los Estados Unidos.[4] Como resu ltado del examen, los derechos definitivos se 
suprimieron el 15 de diciembre de 2013.[5]…"  WT/TPR/M/300/Add.1 
 
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 Pregunta 25 
Resulta preocupante el mantenimiento de las medidas antidumping aplicadas como consecuencia de su prórroga al cabo de los exámenes de extinción (párrafo 3.52 del Informe de la Secretaría) y 
ante la vaguedad y generalidad de las disposiciones para la duración y examen de los derechos 
antidumping del Capítulo V del Reglamento Anti dumping, se pregunta si ¿China ha expedido 
normas que reglamenten más específica y claramente el trámite del procedimiento de estos 
exámenes, de manera que las condiciones de su prórroga no ofrezcan cuestionamientos sobre la 
claridad y justificación de las decisiones adoptadas?   Answer 
China conducts fair, reasonable and whole-process sunset review investigation according to the Anti-Dumping Regulations of the People's Republic  of China and referring to the common practice 
of WTO Members. China is in strict accordance with the principle of transparency and proper 
procedure in practice to ensure the rights and interests of stakeholders. China has studied the 
development of the sunset review rules, and found the vast majority of WTO Members carrying out sunset review investigation had not announced their laws and regulations concerning the sunset 
review, and thus it was difficult to draw referenc e. China will continue to study the development of 
the sunset review rules on practice basis.  3.1.8 Normas y otras prescripciones técnicas  
3.1.8.1 Normas y reglamentos técnicos  
 El párrafo 3.70 del informe de la Secretaría indi ca que… "La AQSIQ sigue siendo el servicio de 
información sobre obstáculos técnicos al comercio (OTC). Este se encarga de preparar, verificar y 
presentar las notificaciones de China. En el período objeto de examen, China presentó 167 
notificaciones OTC, la mayoría de ellas (alrededor de 150) en virtud del párrafo 9 del artículo 2. La 
mayor parte de los reglamentos técnicos notificados se aplicaron para regular el mercado y 
proteger la salud y seguridad de las personas y el medio ambiente. En el Comité OTC se plantearon preocupaciones sobre el plazo permitid o para la presentación de observaciones y el 
hecho de que empresas extranjeras puedan formularlas."  
 
Pregunta 26 ¿En el período en estudio se registraron reglamentos técnicos de emergencia?  
 
Pregunta 27 ¿De ser así, cuántos se expidieron? 
 
Answer 
Within the review period of 2012 and 2013, China informed WTO that it adopted TBT measures against the backdrop of four emergences, namely: The National Standards for Safety Technique 
Specifications of Special School Buses of PRC (G/TBT/N/CHN/909) in 2012, and The National 
Standards for Strength of Student Seat Systems and Their Anchorages of Special School Bus (G/TBT/N/CHN/910) in 2013, The National Standards for Automobile Gasoline of PRC 
(G/TBT/N/CHN/1017) in 2013, and The Pilot Program of Special Approval Procedure for Innovative 
Medical Devices (G/TBT/N/CHN/965); Meanwhile, we also adopted SPS measures amid two emergences, namely, The Notice on Putting Chalara Fraxineat. Kowalski into the List Of Harmful 
Imported Quarantine Pest (G/SPS/N/CHN/601) in 2013, and The Joint Notice by National Bureau 
of Quality Inspection and State Forestry Bureau  on The Prevention of Ash Dieback Diseases 
(G/SPS/N/CHN/632).  WT/TPR/M/300/Add.1 
 
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 3.3.3 Comercio de Estado, empresas públicas y privatización  
 El párrafo 3.173 del informe de la Secretaría in dica que… "Al parecer, el funcionamiento del 
sistema de comercio de Estado no ha variado sustancialmente desde el último examen, realizado 
en 2012. En principio, solo empresas autorizada s pueden importar (y exportar) productos objeto 
de comercio de Estado. Sin embargo, los productos sujetos a contingentes arancelarios (cereales, 
algodón, azúcar y determinados abonos químicos) pueden ser también importados por empresas 
que no sean empresas comerciales del Estado, así como también el petróleo crudo. El único producto objeto de comercio de Estado cuyo comercio solo está permitido a empresas autorizadas es el tabaco. La parte de esos productos que no es objeto de comercio de Estado la asigna la 
Comisión Nacional de Desarrollo y Reforma (NDRC) en el caso de los cereales y el algodón, o el 
Ministerio de Comercio (MOFCOM) en el de los demás productos. La NDRC y el MOFCOM publican anualmente los criterios que ha de satisfacer una empresa para obtener derechos de comercio con 
respecto a esos productos, los volúmenes que se pueden importar y el método de asignación. No 
se dispone de datos sobre las cantidades import adas en régimen de comercio de Estado."  
 
Pregunta  28 
¿Cuáles son los criterios aplicados por la Comisión Nacional de Desarrollo y Reforma (NDRC) y el Ministerio de Comercio (MOFCOM) para permitir que una empresa no estatal comercialice dichos productos? Nos gustaría tener información por producto de los volúmenes importados en los tres 
últimos años por las empresas no estatales. 
 Answer 
You can refer either to the 39th announcement jointly issued by NDRC and MOFOM in 2013 or to 
the website of NDRC (http://www.NDRC.gov.cn) abou t the requirement for the application of grain 
and cotton imported tariff-rate quota in 2014. 
 
4 POLÍTICAS COMERCIALES POR SECTORES  4.1 Agricultura  4.1.3.2 Medidas internas  
 
El párrafo 4.23 del informe de la Secretaría indica que… "En China han seguido aumentando las transferencias presupuestarias a los productores. Los pagos directos a los productores de cereales 
(arroz, trigo y maíz), introducidos en 2004, continúan en vigor y se calculan a un tipo uniforme por 
unidad de tierra cultivada. El pago se hace efectivo al titular de los derechos contractuales sobre la tierra, no a la persona que la cultiva. En general, el tipo aplicado es de 10 a 15 RMB por mu (0,06 
ha), pero puede variar en función de la localidad. El programa se administra a nivel provincial, por 
lo que la cuantía de las subvenciones puede variar ; los gobiernos provinciales locales formulan las 
disposiciones y los procedimientos específicos para la concesión de las subvenciones. La financiación del Gobierno central destinada a los pagos directos se incrementó cada año hasta 
2007, pero después se estabilizó en 15.100 millones de RMB (2.300 millones de dólares EE.UU.) al 
año durante el período 2007-2012".   
Pregunta 29 
¿Nos gustaría conocer los criterios y los montos por provincia que se han aplicado para los subsidios otorgados? 
 
Answer 
Direct subsidies provided by the central governme nt is 15.1 billion RMB. The central government 
sets up the standard (10-15 RMB per Mu). The local governments grants the subsidies at a specific 
rate decided by themselves. The central government does not keep track of the various rates in 
different provinces, cities, or towns.  WT/TPR/M/300/Add.1 
 
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 El párrafo 4.25 del informe de la Secretaría indica que…"En 2006 se comenzó a conceder la 
subvención global a los insumos agrícolas, financiada con cargo al presupuesto central; en 2008, esa subvención era una de las más importantes transferencias presupuestarias de apoyo a la 
agricultura. Las transferencias presupuestarias para ese programa se duplicaron con creces en 
2008 y, desde entonces, han aumentado cada año hasta alcanzar la suma de 107.800 millones de RMB en 2012. El objetivo de ese programa de ay uda es compensar a los productores de cereales 
de cualquier incremento en el precio de los insumos agrícolas, tales como abonos y gasóleo; sin 
embargo, el programa se aplica en forma de pagos por unidad de superficie y no está vinculado al costo de la producción. Según las autoridades, lo s gobiernos provinciales establecen los elementos 
específicos de la subvención en función de las condiciones locales, y no hay una norma general 
sobre su aplicación". 
 Pregunta  30 
Con el fin de tener un mejor entendimiento del pr ograma, solicitamos al Gobierno Chino enuncie 
los elementos y parámetros establecidos por cada provincia para otorgar este subsidio. ¿En cuál de las tres Cajas de ayuda interna, irá notificado estos programas?  
 
Answer 
The central government does not keep track of how the subsidy is granted in different provinces in terms of rate and specific standards, but only the general objective of the fund. The 
comprehensive subsidy on agricultural inputs is listed as non-specific AMS. 
 4.1.3.2.2 Controles de pr ecios y comercialización 
 
El párrafo 4.28 del informe de la Secretaría indica que… "Algunos productos básicos siguen sujetos a controles de precios, al tiempo que otros siguen siendo considerados "importantes materiales de 
reserva" y están, en principio, igualmente su jetos a tales controles. Los productos agrícolas 
considerados materiales de reserva importantes son los cereales, el algodón, los aceites vegetales comestibles (materiales), el azúcar, los capullos del gusano de seda y los abonos químicos. Sin embargo, según las autoridades el precio de esos productos se ha liberalizado y se está revisando 
el Catálogo de Materiales de Reserva". 
 Pregunta 31 
Solicitamos a China explicar más en detalle la nueva metodología aplicada para calcular los precios 
de los productos citados en el párrafo anterior.   
Answer 
Reserved materials such as grain, cotton, sugar and fertilizers, essential to national livelihood, 
have been purchased at the market price of the day by relevant enterprises, and have had nothing to do with the above-mentioned government pric ing and guidance pricing. In line with China's 
commitment to its accession to WTO, China has imposed government pricing and guidance pricing 
on some products and services (Appendix 4 in the Protocol). As we deepen the reform, China has partially deregulated government pricing and guidance pricing. 
 
El párrafo 4.31 del informe de la Secretaría señala que…"Las autoridades centrales y locales mantienen reservas de maíz, arroz, habas de soja y trigo con fines de seguridad alimentaria. 
Según las autoridades, la compra de esas reservas la llevan a cabo empresas designadas a precios 
de "mercado". Las reservas se gestionan con arreglo al Reglamento sobre las reservas nacionales de cereales. Sin embargo, para administrar las reservas a nivel local, los gobiernos provinciales establecen sus propios reglamentos administrativos,  que se basan en el reglamento nacional. Las 
autoridades han indicado que esas reservas no se utilizaron en 2012 y 2013."  
 Pregunta 32 
¿Cuáles son los criterios para determinar el precio de mercado para comprar maíz, arroz, soya y 
trigo y almacenarlos bajo la modalidad de reserva?   WT/TPR/M/300/Add.1 
 
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 Answer 
Prices of corn, rice, bean and wheat are not guid ed by the Government but the market. Food stock 
is purchased from the market at market price. The reserves are maintained and managed 
according to Grain and Oil Storage Management Regulations and Regulations on Quality Control Of 
Grains and Oil.  
Pregunta 33 
Nos gustaría conocer los principales elementos de los gobiernos de cada provincia para administrar los inventarios.  
Answer 
Local reserves are managed differently. Some prov inces have state-owned enterprises for grains 
purchase and stocking, others delegate to qualified private companies. 
 
Pregunta 34 Podría el Gobierno Chino enunciar las diferencias de los programas regionales frente a la 
normativa nacional conocida como Reglamento sobre las reservas nacionales de cereales.  
 Answer 
Reserves in central and local levels follow the same regulations but are managed differently. The 
sizes of local reserves are determined by the central government after analyzing the data of 
population, consumption, urbanization and so on.  
Pregunta 35 
¿Estos programas de inventarios con fines de seguridad alimentaria fueron otorgados entre 2008 y 2011?  
 
Answer 
The plan for reserves was implemented and completed in recent years, which not only safeguarding the food security for China but also making great contribution to the world food 
security. 
 Pregunta del Documento en inglés de la Secretaría WT/TPR/G/300  
 
3.3.5. Intellectual property rights  3.3.5.1. Overview and institutional developments  
 
El párrafo 3.199 del informe de la Secretaría indi ca que… "The Inter-Ministerial Joint Conference 
for the Implementation of National Intellectual Pr operty Strategy, established in October 2008, is 
in charge of coordinating the implementation of intellectual property policy and regulations across 
relevant ministries and agencies. The Conference  is chaired by the Commissioner of the State 
Intellectual Property Office (SIPO) and its tasks are executed by the National Intellectual Property Strategy Office (NIPSO), situated in the SIPO. The Conference annually issues a Promotion Plan for 
the Implementation of the National Intellectual Property Strategy, with specific actions to be 
carried out during the year in question to attain  the goals of the strategy. In 2013, the strategic 
themes/actions identified were grouped under eight main goals:  
 
a. enhancing intellectual property (IP) creation by raising the quality of intellectual property 
rights (IPRs), as well as innovation efficiency. The aim is to improve IPR protection by reinforcing the evaluation system and promotin g the quality of IP by upgrading the value 
generated by its protection. Measures proposed to attain this include: streamlining the process 
of patent applications and improving the patent examination system; improving the trademark examination process and completing the registration review cycle in 10 months; continuing 
progress in the development of an automated trademark registration and management 
system; enhancing the effectiveness of trademark registration; completing trademark opposition review proceedings within 18 months; developing and refining new plant varieties 
testing guidelines and approval rules;  
b. strengthening IP in key industries. This is to  be done by: promoting the integration of IPR 
protection with industrial policy; developing an d implementing a strategic industries IP work 
plan to take into account the IPR protection needs of these industries; promoting the WT/TPR/M/300/Add.1 
 
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 development of green technologies and green pate nt applications by granting them a priority 
review process; developing an "industry IP risk assessment and early warning system" with respect to selected industrial transformation processes; 
c. promoting the use of IP. To be achieved by: im proving the commercialization of IP linked and 
IP-based innovation; implementing policies to facilitate the transfer of IP to enterprises; and promoting the commercialization of IPRs; 
d. strengthening IPR protection. To be achieved by: revising the key laws and implementing 
regulations; strengthening IPR protection for pharmaceuticals; stepping up copyright protection on the Internet; enhancing the effe ctiveness of judicial IPR protection and the 
capacity of administrative enforcement by, for example, continuing to expand the number of 
courts dealing with IPR issues (see enforcement section, below); stepping up efforts to 
continue fighting against counterfeiting and sale of fake goods, including on the Internet; stepping up efforts to combat cyber piracy "network operations", in audio, video, games, and 
software; launching a "patent law enforcement capacity-building project"; improving 
trademark protection through well-known brand programmes and the promotion of licensing; strengthening customs protection of IPRs; strength ening the protection of IP resources in fields 
with traditional advantages; enhancing the ability to deal with international cases; 
implementing the special protection operations  and assistance programmes for key fields and 
industries, promoting the information disclosure of IP cases subject to administrative penalty; 
e. development of IP services, including access to information, and support to other industries, 
and improvement in the qualification of patent lawyers. This is to be achieved by strengthening 
and promoting the use of IP information resour ces, promoting the expansion of IP service 
providers' businesses, and training IP service providers;." 
Pregunta 36 
Sobre el avance en el desarrollo del registro automatizado de marcas y del sistema de administración ¿Dicho sistema permitirá hacer todo el proceso de registro a través de medios 
electrónicos? ¿Cuáles el principal objetivo de este sistema? 
 Answer 
The Trademark Office under the umbrella of State Administration for Industry and Commerce is 
now working hard to upload the Phase 3 of trademark registration and automation management 
system, and then switch to the development and improvement of auxiliary functional module and 
refine the system. In line with the demands of busi ness divisions, the operation of review and trial 
under trademark business can be digitalized, and the paper files are also called for reference when 
dealing with disputes on trademark and retrial . The Phase 3 includes the automatic review and trial business of trademarks and public services. Among them, the review and trial have integrated 
8 subsystems, and adjusted, in accordance with the operation procedure of new Trademark Law, 
where the examiner can check the trademark business on double-screen computers. In addition, the public service system can provide online chec k, application, and notice to the public.  
 
Pregunta 37  
Sobre nuevas variedades vegetales ¿Las nuevas normas expedidas en China responden a los estándares establecidos en UPOV91? 
 
Answer 
The test guide for distinctness, uniformity and stability (DUS) of plant variety in China is 
formulated in compliance with the general test principles by UPOV and related test guides. It 
strictly tests the properties required by UPOV test guide. Currently in the DUS test guide for 
agricultural plants, 8 plants including rice have DUS test guides released as national standard, 
147 plants including normal wheat have DUS test guides released as agriculture sectoral 
standards.  
 Pregunta  38 
¿Cómo funciona el proceso de revisión prioritario de patentes? ¿Cuáles son los parámetros que usa 
la SIPO (Oficina de Patentes) para seleccionar las solicitudes que deben ser analizadas con prioridad?  
 WT/TPR/M/300/Add.1 
 
- 61 - 
 
  
 Answer 
We are coordinating with relevant authorities. 
 
Pregunta 39 
¿Cuáles son los parámetros utilizados en China para identificar las industrias clave para la propiedad intelectual?  
 
Answer 
We are coordinating with relevant authorities.  
Pregunta 40 
¿Cuáles son los mecanismos que utilizará China para fortalecer las capacidades de los abogados de patentes?  
 
The SIPO released the Opinions on Promoting Patent Attorneys Sector in 2014 to enlarge the 
sector scale of patent agency and improve the serv ice capacity of the sector. The Opinions adjust 
the requirements on licensed patent agency, in or der to attract more qualified and capable people 
to engage in this sector. In addition, SIPO and All-China Patent Agents Association (ACPAA) will 
organize business training for licensed patent attorneys on a regular basis to enhance their capabilities. 
 
3.3.5.2. Industrial property  3.3.5.2.2. Trade marks  
 
El párrafo 3.220 del informe de la Secretaría señala que… "Several regulations have been introduced to enforce trademark protection in e-commerce. SAIC's Circular of Opinions on 
Extending Cross-Provincial Enforcement to Commodities Trading on the Internet and its Related 
Services (Gong Shang Shi Zi 2011/11), issued on 27 May 2011, facilitates the procedures for cross-provincial investigations regarding IPR violations through the Internet. The Interim Measures on Administration of Commodities Trading on the Internet and its Related Services, SAIC Decree 
2010/49, which entered into effect on 1 July 2010, requires the operator of the Internet trading 
platform to take the necessary actions against trademark infringement, and makes the operator responsible for disciplining users of the platform, as well as liable for any damage caused by 
misuse of the platform. A judicial interpretation (JI) issued by the Supreme People's Court on the 
liability of Internet intermediaries (Rules of Supreme Court on Several Issues Concerning the Application of Law in Adjudication of Civil Disputes Related to Infringement of the Right of 
Communication through Information Networks), effective 1 January 2013, clarifies some 
enforcement issues by specifying that that those who facilitate online infringement will be held jointly liable for that conduct."   
Pregunta 41 
En relación con el fortalecimiento de la protección de marcas en el comercio electrónico, sería interesante conocer, más específicamente, cuáles son las medidas que el Gobierno Chino está 
implementando para proteger las marcas en el comercio electrónico y para establecer 
responsabilidad de intermediarios en internet.   
Answer 
On 26 January 2014, the State Administration for Industry and Commerce has issued Regulation 
on Internet transactions, which hereinafter is re ferred to as "Regulation". The "Regulation "has 
come into force since 15 March 2014, and meanwhile abolish the Interim Measures for the Trading 
of Commodities and Services through the Internet, which is in the 49th Announcement issued by 
the State Administration for Industry and Commerce.  The Article 15 of "Regulation" provides that 
the online business dealers, product sellers and rele vant service providers should act in line with 
relevant laws and regulations such as The Law on Trademark and Provisions on Management of 
Registration of Enterprise Name, and should not infringe upon the right to exclusive use of registered trademarks and the enterprise name right. The Article 27 of the "Regulation" stipulates 
that the third-party transaction business dealers should take necessary approaches to protect the 
right to exclusive use of registered trademarks and the enterprise name right. Any malpractice proven by rightholders should be punished in line with the Tort Liability Law.   WT/TPR/M/300/Add.1 
 
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 3.3.5.2.3. Geographical indications  
 El párrafo 3.224 del informe de la Secretaría seña la que…"There is no specific legislation for 
geographical indications (GIs) in China. Th ey are covered by the Trademark Law and its 
Implementing Regulations and may be registered as collective marks or certification marks with the TMO under the same procedure as for trademarks. GIs may be also registered with AQSIQ or 
the Ministry of Agriculture. The party concerned can voluntarily choose under which governmental 
agency(ies) to register its GIs. Once infringeme nts occur, the interests of the party will be 
protected pursuant to the relevant laws and regula tions under which its GIs are registered. In case 
a single GI is registered for protection with different agencies, each agency would play its due 
regulatory role strictly according to its respective mandate."  
Pregunta 42 Entonces, si las Indicaciones Geográficas no tienen legislación en China y deben ser registradas 
como marcas colectivas o de certificación ¿esto significa que en el registro de una IG en China no 
se requiere demostrar que el producto tiene características particulares asociadas a su modo de producción, al territorio geográfico donde se produce y a las calidades especiales del recurso 
humano que lo produce?  
 Answer 
Geographical indications (GIs) and trademarks are two types of intellectual property rights. 
According to China's domestic law, GIs is not necessary to be managed as trademark (the 
Trademark Law only specifies how to handle trad emark and GIs. The Implementing Regulations of 
the Trademark Law only specifies one feasible ap proach for GIs protection, which is subject to 
voluntary selection of business operators). The Ministry of Agriculture released the Management 
Method on the GIs of Agricultural Products (MOA Order No. 11) to protect GIs registration of agricultural products, with more than 20 specific regulations covering all technical aspects of 
registration and protection. In order to further improve our GIs management, the State 
Commission Office of Public Sectors Reform released the Opinions on Improving Geographical Indications Protection System and Mechanism in 2011 (SCOPSR [2011]No. 26), which clearly calls for setting up special GIs protection regime and gives full play to different departments based on 
the existing labor division to give more efforts to GIs fostering and protection and work jointly to 
draft GIs protection laws, regulations and comprehensive policies, so as to further promote sound development of China's GIs protection.  
 
3.3.5.4. Other IPRs  3.3.5.4.3 Undisclosed information and trade secrets  
 
El párrafo 3.243 del informe de la Secretaría señala que… "Under the Regulations for the Implementation of the Law on Drug Control, China protects test data and other data that are self-
obtained, undisclosed, and submitted by manufacturers or sellers to obtain an approval for 
manufacturing or selling a drug that contains new chemical entities. It is forbidden to use such 
undisclosed test data and other data for improper commercial purposes. The protection term for the manufacturer or seller is of six years from the approval for manufacturing or selling the drug. 
During this period, the authorities are mandated to deny approval to other applications using the 
same data. A similar protection term is granted for undisclosed data on agro-chemicals under the Regulations on Administration of Agricultural Chemicals."  
 
Pregunta 43  
¿Cuál es el término en la protección de datos en agroquímicos?  
Answer 
We are coordinating with relevant authorities. 
 WT/TPR/M/300/Add.1 
 
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 El párrafo 3.135 del informe de la Secretaría señala que…"The AML's main objectives are to 
safeguard fair market competition, and improve economic efficiency, while protecting consumer 
and public interest. In particular, the AML focu ses on preventing, analyzing and combating three 
kinds of monopolistic conduct: the conclusion of monopoly agreements; the abuse of a dominant 
market position; and concentrations of undertakings that have or are likely to have the effect of eliminating or restricting competition. The AML applies to all sectors of the economy and to all 
types of enterprises with the exception of associated or concerted conduct by agricultural 
producers and rural economic organizations in th eir business activities (production, processing, 
sales, transportation, and storage of farm prod ucts) related to agricultural products. The AML 
covers monopolistic operations that have an effect on the Chinese market - that is, operations 
within China as well as activities outside the territory of China that have eliminative or restrictive 
effects on competition in China's domestic market."   
Pregunta 44 
¿Cómo hace el Estado el seguimiento a la implementación y cumplimiento de esta ley antimonopolio? ¿Tiene el Estado una política para implementar esta ley?  
 
Answer  
As part of efforts to implement Anti-trust Law, Chinese government has formulated Provisions against price monopoly (NPRC Decree No. 7), and Provisions on Law-Enforcement Procedures 
Against Price Monopoly (NPRC Decree No. 8) in 2010. Recently, the Chinese Government also 
drafted Provisions on the Pricing Administrative Punishment Procedures (NPRC Decree No.22), Provisions on the Evidence of Pricing Administrative Punishment and Several Provisions on the 
Administrative Punishment on Regulating Pricing.  
 El párrafo 3.136 del informe de la Secretaría señala que…"Although the AML covers all types of 
enterprises, Article 7 of the Law allows the exercise of exclusive activities of state-owned 
enterprises (SOEs) that are considered vital to  the Chinese economy and to safeguard national 
security or that have been granted legally-exclusive production and sales rights. In accordance with the AML, the State will supervise and regulate  these firms' operations and the prices of the 
goods and services they supply." 
 Pregunta 45 
¿Cuáles son estas actividades exclusivas y cómo el estado les hace seguimiento?  
 Answer 
The Article 7 of Antitrust Law provides for the protec tion for the legitimate operation in both public 
sectors essential to national livelihood and national security, and those enterprises practicing exclusive marketing and selling in line with laws. Meanwhile, this article also stipulates relevant business operators to be engaged in compliance and self-discipline, to be exposed to public 
supervision, and not to undermind consumers' intere st by leveraging on its overriding role or the 
exclusive marketing and selling right. In this connection, "Antitrust Law" in China is against the anti-competition behavior. We have remained committed to this principle of equity and justice, and 
held accountable in accordance with the law all malpractices against "Antitrust Law" regardless of 
the business ownership so as to keep the market order fair competition.  
El párrafo 3.137 del informe de la Secretaría señala que…"The Anti-Monopoly Committee of the 
State Council is responsible for organizing, coordinating and guiding anti-monopoly work. The Committee, whose General Office is in MOFCOM, also coordinates the work of the three different state agencies responsible for competition policy  implementation and enforcement (Table 3.13). 
MOFCOM's Anti-Monopoly Bureau is in charge of  conducting anti-trust reviews. The other two 
agencies deal with specific issues related to the surveillance of monopoly agreements, abuse of 
market dominance, and abuse of administrative powers. The Price Supervision and Anti-Monopoly 
Bureau of NDRC has responsibility for price-related violations of the rules in these areas, while the 
Anti-Monopoly and Anti-Unfair Competition Enforc ement Bureau of the SAIC deals with non-price 
issues. Each authority has issued a series of ministerial rules in their own area of responsibility."  
 WT/TPR/M/300/Add.1 
 
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 Pregunta 46 
¿Se han presentado casos antes el Comité Antimonopolio? ¿Por qué motivos y como los han resuelto? ¿Les hacen seguimiento una vez concluyen? 
 
Answer 
In Article 9 of Antitrust Law, the State Council has set up a "Antitrust Commission" to be in charge 
of organization, coordination and guidance in this regard. They will deliver on the following 
responsibilities:  - First, to study and draw out relevant policies concerning competition; - Secondly, to make investigation and probe into the overall picture of market competition, and 
release the evaluation report;  
- Thirdly, to formulate and issue anti-trust guidance;  - Fourthly, to integrate law-enforcement work on antitrust;  
- Fifthly, other responsibilities endowed by the State Council.  
The Antitrust Commission is a coordination agency. That means it cannot perform any relevant law-enforcement, and is void of the power of law execution, and thus it can't deal with relevant 
cases.  
El párrafo 3.176. del informe de la Secretaría se ñala que… "In the context of the present Review, 
the Chinese authorities have highlighted that since 2011, transparency in China's government procurement process has improved. In this connection, they point out the increasing resort to 
public-tendering methods: the percentage of go vernment procurement through public tendering 
now exceeds 80% and the use of single-source procurement has been reduced (see below). Also, efforts to make government-procurement-related information publicly available have been stepped 
up, as more documents linked to the procurement process, as well as the results of investigations 
and penalties imposed for misusing the procurement process, have been published."   
Pregunta 47 
¿Tienen una política establecida para mejorar la transparencia? ¿Cómo se articula las instituciones que en ella participan?  
Answer 
The Management Method on Information Notification of Government Procurement (MOF Order No. 
19) provides specific regulations for informat ion disclosure in government procurement. The 
Implementation Regulations on Government Procurement is being drafted to lay down further 
requirements for improving transparency of govern ment procurement. The institutions engaged in 
tendering shall follow these regulations to disclose the bidding information and result at the 
specified media and is subject to public supervision.  
 El párrafo 3.178 del informe de la Secretaría señala que… "According to information provided by the Chinese authorities, the total value of government procurement increased to RMB 1,133.2 
billion in 2011, up from RMB 842.2 billion in 2010 (Table 3.18). Government procurement 
accounted for about 2.2% of GDP (2.1% in 2010). The data cover only procurement by government departments, institutions, and public organizations using fiscal funds, for goods, 
construction, and services listed in the "Centr alized Procurement Catalogue" or above the 
threshold using other financial resources. It does not cover procurement by SOEs, which the Chinese authorities do not consider falls under the definition of government procurement (see 
below). Local governments account for a major part of government procurement in China; they 
accounted for 87.6% of the total value of government procurement in 2011."  Pregunta 48  
Si las empresas estatales no están listadas en el Catálogo, ¿cómo se adelantan en ellas procesos 
para mejorar la transparencia, especialmente en la adquisición de bienes y servicios y en el relacionamiento de estas empresas con su cadena de valor? 
 
Answer 
China's state-owned enterprises are market play ers with self-management. The procurement is 
decided all by enterprises following market rule. Currently, China's state-owned enterprises 
generally use public tendering to make procurement. Meanwhile, sound internal management system has been set up to ensure the disclosure and transparency of procurement.   WT/TPR/M/300/Add.1 
 
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 El párrafo 3.181 del informe de la Secretaría seña la que…"Decentralized procurement of items not 
listed in the Centralized Procurement Catalogue, but with a value above a certain procurement threshold, which is specified by governments at various levels, is carried out by the procuring 
agency itself." 
 Pregunta 49 
¿Cómo funciona esta agencia?  
 Answer 
Centralized procurement and decentralized proc urement are both legitimate approach of 
government procurement. Similar to centralized procurement, the decentralized procurement also 
follows the Government Procurement Law and related regulations to strictly carry out procurement procedure and ensure procurement information disclosure.  
 
Generalidades en materia de Medi das Sanitarias y Fitosanitarias 
 
Desde el último examen no se han dado cambios importantes en la legislación MSF de China, que 
cuenta con gran cantidad de leyes y reglamentos. El procedimiento de inspección de las importaciones y exportaciones sujetas a MSF no ha cambiado desde 2010. Todos los productos importados y exportados deben someterse a las autoridades de cuarentena e inspección de 
entrada y salida. Las disposiciones relacionadas con inspección y cuarentena se aplican a cerca del 
80% de los productos sujetos a licencias automáticas de importación y a alrededor del 35% de los productos sujetos a licencias no automáticas. 
Cabe destacar que entre 2011 y 2013 los miembros de la OMC plantearon preocupaciones sobre 
las medidas impuestas por China relacionadas con las condiciones sanitarias, sobre las cuales no se ha informado a la OMC. Entre esas medidas se  encuentran los procedimientos de cuarentena y 
prueba para el salmón, los métodos de prueba aplicados a los aditivos alimentarios, las 
restricciones aplicadas a las importaciones de carne de bovino por encefalopatía espongiforme bovina (EEB). Adicionalmente se han reiterado en varias ocasiones los requisitos de registro para las empresas extranjeras que importan alimentos en China. Las autoridades China's respondieron 
al respecto que esas medidas se basan en las normas de la OMC. 
 No obstante la respuesta dada al respecto, es evidente que China aún no cumple a cabalidad las 
disposiciones sobre transparencia contempladas en el artículo 7 del Acuerdo sobre la Aplicación de 
Medidas Sanitarias y Fitosanitarias de la OMC.  
Answer  
With regard to the "Test Method of Food Addi tives" mentioned by Columbia, China has adopted 
National Standard for Food Safety General Stan dard for Food Additives (G/SPS/N/CHN/480) on 
17 November 2011, and Usage Standards for Food Additives (G/SPS/N/CHN/602) issued by 
National Health Service on 27 March 2013 and Regu lated Procedures on Producing Food Additives 
(G/SPS/N/CHN/651) issued by National Health and Family Planning Commission on 5 June 2014.  WT/TPR/M/300/Add.1 
 
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 PREGUNTAS ADICIONALES DEL GOBIERNO DE COLOMBIA 
Document to WT/TPR/S/300-China 
 
En lo relacionado con Normas de Origen (3.1.3) se indica en el numeral 3.12 que "Las normas de 
origen preferenciales se aplican de conformidad con los diversos acuerdos preferenciales suscritos por China o para otorgar un trato preferencial a las importaciones procedentes de los PMA". Al 
respecto, Colombia tiene interés en conocer si Ch ina maneja dentro de sus acuerdos el mecanismo 
de escaso abasto y el mecanismo de acumulación con sus socios comerciales. De ser así, agradecemos nos compartan si se tiene procedimientos establecidos para la aplicación de estos mecanismos.  
 
Answer  
Please further clarify the relationship between "the control mechanisms of supply of scarce goods 
and accumulation of trade partners" and the prefer ential rules of origin? China is not very clear 
about Colombia's question.   
Informe de la Secretaría (WT/TPR/S/300): 
 Durante el período objeto de examen, China siguió aplicando una política fiscal activa, y el gasto aumentó a un ritmo más rápido que los ingresos. El déficit fiscal se situó en el 1,7% del PIB en 
2012 y, según las estimaciones, en el 1,9% del PIB en 2013. Aunque la deuda del Gobierno 
Central se mantiene en un nivel moderado (14,9% del PIB en 2012), la deuda pública total es bastante mayor (39,4% del PIB a finales de 2012). China sigue fomentando la participación del 
sector privado en la economía, y el número de empresas privadas y empresas familiares 
industriales y comerciales ha venido aumentando. No obstante, la participación estatal en la economía continúa siendo relativamente elevada, ya que el sector público controla alrededor del 
40% de la inversión en activos fijos y le corresponden las dos terceras partes aproximadamente de 
las exportaciones totales.   Pregunta 
¿Respecto a las condiciones antes planteadas de participación estatal en la economía de la 
República Popular China, durante el período objeto de examen 2012-2014, siguiendo lo establecido en el párrafo 15 del Protocolo de Adhesión de dicho país a la OMC, debe entenderse que China no 
daría cumplimiento al periodo de transición en el cual se espera que su economía se ajuste a 
condiciones de mercado?   
Answer  
Since its accession to the WTO, China has been honoring its WTO committments, and developing a 
market economy. At present, the State-owned enterprises have, as a whole, been combined with the market economy, and have become market players and legal entities, which operate 
independently and assume sole responsibility. As  with other ownership enterprises, they have 
participated in market competition equally.  
En 2013, los principales destinos de las exportaciones de mercancías de China siguieron siendo la 
UE; los Estados Unidos; Hong Kong, China; el Japón; y la República de Corea, así como países de la ASEAN. Los principales mercados de origen de sus importaciones fueron la UE, la República de 
Corea, el Japón, el Taipei Chino, los Estados Unidos y Australia, así como países de la ASEAN. Ese 
mismo año, los servicios representaron el 8,7% de las exportaciones totales de China y el 14,4% de sus importaciones.  
Pregunta 
¿Las mercancías exportadas por la República Popular China a Hong Kong, China, pueden ser a su vez exportadas a terceros a países con origen Hong Kong, China?  
 WT/TPR/M/300/Add.1 
 
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 Answer  
The country of origin for import goods shall be determined in accordance with the rules of origin of 
importing country. In the case of China, according to Article 3 of the Regulations on the Origin of 
Imported - Exported Goods of PRC, a country (region) shall be determined as the origin of the 
goods if these goods have been wholly obtained i n  t h i s  c o u n t r y  ( r e g i o n ) ;  w h e n  m o r e  t h a n  o n e  
country (region) is concerned in the production of the goods, the country (region) where the last 
substantial transformation has been carried out shal l be determined as the origin of these goods.  
 WT/TPR/M/300/Add.1 
 
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 9  QUESTIONS BY THE REPUBLIC OF KOREA 
PART I Questions Regarding the Secretariat Report  
 
3. TRADE POLICIES AND PRACTICES BY MEASURE 
 Page 39 (Para 2.28), page 109  
China became a WTO Member on 11 December 2001.  China is an observer to the Plurilateral 
Agreement on Government Procurement (GPA) and is in the process of negotiating its accession thereto. At the 9
th WTO Ministerial Conference (MC9) in Bali, the authorities indicated that an 
inter-agency mechanism has been established, which could expedite the GPA accession process. 
China submitted a revised offer in December 2013. 
 On 29 November 2012, China circulated its third revised coverage offer ....The GPA Committee has 
expressed the view that "China's GPA accession, on the appropriate terms, is a matter of great 
significance for the Agreement, for the WTO, an d for the world economy; and a very important 
signal for other emerging economies"  
 
Question 1  
With regard to China's accession to the WTO GPA, Korea is of the view that there could be room for improvement, particularly in areas such as procurement by local governments, state-owned 
enterprises, construction service concessions, and ambiguous limitations in the general notes 
section. Also, in regard to China's recent offer, concerns were expressed among members over China's proposed domestic content requirements included in the Annex to the offer, as local 
content requirements cannot be allowed as an exception to the national treatment obligation even 
if the measures are related to government procurement. In this regard, does China have any plan to further revise its offer? Another issue of great concern to all other parties including Korea, is 
when China will be able to circulate its fifth revised offer on accession to the Agreement on 
Government Procurement.  Answer 
China will submit a revised offer in 2014, the coverage of which is commensurate with GPA participants.  
Page 42 (Para 2.45)  
Foreign investment projects are classified in fo ur categories: encouraged, permitted, restricted, 
and prohibited. In general, projects in the enco uraged category (those that the authorities are 
interested in promoting) are those that use improved technology and are less polluting, while 
restricted projects are those deemed to employ outdated technologies, over-exploit scarce natural 
resources, or harm the environment. The prohibited  category includes projects that are considered 
as polluting the environment, destroying natural resources or damaging social and public interests. 
Projects that do not fall into these 3 groups are "permitted".  
 Question 2 
The Secretariat's report states that foreign investment projects are classified in four categories: encouraged, permitted, restricted, and prohibited . The report also states that the prohibited 
category includes projects that are considered as polluting the environment, destroying natural 
resources or damaging social and public interests. Could China please explain why "internet culture 
business (music only)" is included in the prohibited category in Table 2.2? Also, could China please inform us what kinds of industries are classified as "internet culture business"?   
Answer 
Korea has a misunderstanding regarding Table 2.2. "Internet culture business" was included in the 
prohibited category in the Catalogue of Industries for Guiding Foreign Investment (2007 version), 
while in the Catalogue of Industries for Guiding Foreign Investment (2011 Revision), 'internet 
culture business' was revised to 'internet culture business (exclusive of music), which means internet music business is in the permitted category. 
 WT/TPR/M/300/Add.1 
 
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 Page 47 (Para 2.6.1)  
FIEs must also register with the State Administration for Industry and Commerce or a provincial 
commercial department, and with the SAFE. Registration requirements are the same as for 
domestic enterprises, but may vary slightly depending on the sector of activity. Corporations are 
registered in accordance with the Corporations Law, while partnerships are registered in accordance with the Partnership Law.  
 
Question 3 
Regarding the registration procedure, while FIEs in most countries are allowed to do business nationwide without additional registration, FIEs in  China are required to register as a separate 
legal entity with the government of each province in which they wish to establish branches, placing 
a burden on foreign investors in expanding their business nationwide. Korea would like to know if the Chinese government has any plan to centralize the administration of the registration system in 
China.  
 Answer 
"Regarding the registration procedure, while FIEs in most countries are allowed to do business nationwide without additional registration, FIEs in China are required to register as a separate legal entity with the government of each province in which they wish to establish branches, placing 
a burden on foreign investors in expanding their business nationwide." At present, it is not stated 
in any laws and regulations, and there are no re levant provisions about this from China's State 
Administration for Industry and Commerce.  
Page 57 (Para 3.8)  
Although China is making efforts to harmonize customs procedures across the country, it is also 
promoting and creating "new special customs supe rvision areas" that are governed by special 
regulations.  
 Question 4  
Many foreign exporters to China still experience difficulties due to the inconsistent application of 
law and regional variation in customs procedures in China. For instance, HS code classification on 
identical products is sometimes different depending on local customs, which results in different customs valuation on identical products. What efforts have been made by the Chinese government 
to harmonize customs procedures across the country so far? Is there any plan to further 
strengthen the harmonization of customs procedures across the region?   
Answer 
All Chinese Customs use the H2010 clearance management system. This is no "to-be-harmonized" 
issue. Chinese Customs have continuously improved port clearance environment and accelerated port 
clearance speed. For many years, a series of convenient clearance measures have been adopted, 
including advance declaration, collective declarat ion and appointment for customs clearance, which 
effectively facilitate trade development. 
 
Chinese Customs is a law enforcement body with vertical management regime. It has been practicing administration by law and enforcement by universal regulation to ensure the Customs 
Law and related laws and regulations are implemented within the Customs jurisdiction in a 
complete, accurate and consistent manner. It promotes all-round legal governance in all Customs and continuously explores clearance reform to ensure and promote procedural consistency of all Chinese Customs.  
 
Firstly, enhancing legislation work, continuously improving and revising Customs enforcement basis to ensure consistency of Customs legal syst em and ensure regime and system in place for 
consistent procedure in all Customs. 
 Secondly, enhancing consistent enforcement; ensuring the Customs Law and related laws and 
administrative regulations to be universally implemented in all regions and ports; promoting 
consistent enforcement work as a systematic, long-term and regular work; in each of the past two years, Chinese Customs selected several prominent issues that have great impact on consistent enforcement and raise great social concern and complaints, which are studied and tackled.  WT/TPR/M/300/Add.1 
 
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 Consistent and standardized enforcement of the Customs will create a fair, equitable, safe and 
convenient clearance environment.   
Finally, Chinese Customs regulates discretionary power, enhances legal supervision of 
administrative review and raises legal awaren ess and enrich legal knowledge of all Customs 
officers to ensure consistent procedure in all Chinese Customs.  
 
Page 71 (Para 55)  
Also, there are no provisions to regulate the use of  price undertakings to settle a CV investigation.  
 
Question 5 
Is there any special reason for not allowing price undertakings for CV Regulations? If not, is China 
willing to incorporate the relevant provision into its CV Regulations as in Article 18 of the WTO 
Agreement on Subsidies and Countervailing Measures?  
 Answer 
The CV Regulations allows for price undertakings. Articles 32-37 specify requirement on price undertakings.  Page 87 (Para 3.119)  
China's most recent notification to the Committee on Subsidies and Countervailing Measures dates from 2011. The notification contains 93 programmes maintained at the central level and covers the period 2005-2008. The programmes listed in the notification included incentives provided to: 
Foreign-Invested Enterprises (FIE) (section 2); to Small and Medium Enterprises (SMEs); to less 
developed regions and "special economic zones" (section 2); to specific industries and to agriculture. … According to the authorities, these programmes have not changed substantially 
since 2008; however, several of the programmes notified in 2011 have been eliminated. The 
authorities were not able to provide statistical data regarding disbursement for the different support programmes, taxes foregone as a result of the support measures' or the amount budgeted for these.  
  
Question 6 
While China appears to have made efforts to provide updates on its subsidy policies through 
notification to the SCM Committee on measures introduced since 2008, several of the subsidy 
programs notified in 2011 were reportedly eliminated. Please provide a detailed explanation of why these programmes have been eliminated.  
 
Answer 
We are coordinating with relevant authorities.  
Page 88 (Para 3.122)  
Specific industries such as emerging industries, high and new technology industries, industries that 
promote energy conservation and environmental pr otection, industries related to public welfare 
and public infrastructure, which would not otherwise attract capital, are supported by the State. 
The objective of these support programmes is to promote innovation, upgrade industries, and protect the environment and green development.  
 
Question 7 
What kinds of 'high and new technology industries' are subject to the support programme?    
Answer 
The support programme for "high technology industries" has followed the basic principle of 
national treatment, 'no difference between internal  and external corporations'. The program covers 
sectors prioritized in China's Eleventh Five-year Plan for High Technology Industries, such as 
electronic information, biological industry, aerospace industry, new material, new energy and ocean industry.  
 WT/TPR/M/300/Add.1 
 
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 Page 93 (Para 3.135)  
The AML's main objectives are to safeguard fair market competition, and improve economic 
efficiency, while protecting consumer and public interest. In particular, the AML focuses on 
preventing, analyzing and combating three kinds of monopolistic conduct: the conclusion of 
monopoly agreements; the abuse of a dominant market position; and concentrations of undertakings that have or are likely to have the effect of eliminating or restricting competition. The 
AML applies to all sectors of the economy and to all types of enterprises with the exception of 
associated or concerted conduct by agricultural producers and rural economic organizations in their business activities (production, processing, sales,  transportation, and storage of farm products) 
related to agricultural products. The AML covers monopolistic operations that have an effect on the 
Chinese market – that is, operations within China as well as activities outside the territory of China 
that have eliminative or restrictive effects on competition in China's domestic market.   
Question 8 
What is the basic legal principal or criterion applied in a situation where, in terms of jurisdiction 
over competition laws, the Chinese authority claims jurisdiction over a foreign undertaking?  
 
Answer 
According to the Article 2 of Anti-monopoly Law, monopolistic conduct of economic activities in the territory of China is subject to the law; monopolisti c conduct outside the territory of China, if exert 
exclusions and restrictions on domestic competition market, is subject to the law. Hereby, Chinese 
authority will claim jurisdiction in both situations: monopolistic conduct in the territory; monopolistic conduct occurs outside the territory, but has effects on domestic competition market. 
 
Question 9 
How can issues occurring due to overlapping or conflicting jurisdictions over competition laws with 
other related authorities be addressed or resolved? 
 Answer 
According to the AML, the antitrust responsibilities have been clearly defined and divided among 
the National Development and Reform Commission, the Commerce Department, and the State 
Administration for Industries and Commerce. Up to present, issues due to overlapping or conflicting of functions have not occurred. Besi des, the NDRC has established the communication 
and coordination mechanism with related ministries, in case where reports or applications are 
submitted to several ministries at the same time, the mechanism will ensure that only one department will be in charge. 
 
Question 10 
Are there provisions in the competition law of China regulating export cartels? If so, what are the specific criteria for applying such provisions?  
 
Answer 
In the AML, Article 15 stipulates the exempt  circumstances and conditions of monopoly 
agreements, and item 6 refers to trade cartels, according to which, the status where the operators 
can prove that monopoly agreements belong to "f or protecting the right benefit of the foreign 
trade and economic cooperation with foreign countries", should not apply to Article 13 and Article 
14. 
 Question 11 
According to the AML, competition law will be applied to extraterritorial activities having 
anticompetitive effects on the domestic market in China. Does this include indirect effects on the 
market as well as direct one?   
Answer 
On extraterritorial operation, the AML only prov ides principle rule. Whether 'exerting exclusions 
and restrictions on domestic market' include indirect effects and to what extent, the relevant 
legislative institution does not give clear explanations yet. 
 WT/TPR/M/300/Add.1 
 
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 Question 12  
In case where after there were collusions betwee n manufacturers of intermediary goods in the 
overseas countries and these goods are used for making finished products before being imported 
to China, does the Chinese authority exercise its jurisdiction over the foreign undertakings and 
what is the decision making criteria used when deciding whether to exercise the jurisdiction or not?  
 
Answer 
According to Article 2 of the AML, if the mono polistic behaviors overseas exert exclusions and 
restrictions on domestic market, whether concerning  finished products or semi-finished products, it 
is subject to the AML, and Chinese anti-monopoly enforcing authority will exercise jurisdictions. 
 Question 13 
When an overseas subsidiary of a Chinese underta king becomes the victim of collusive behaviors 
occurring overseas, can the Chinese authority exercise its jurisdiction over companies involved in the cartel?  
 
Answer 
According to Article 2 of the AML, Chinese an ti-monopoly enforcing authority will exercise 
jurisdictions when the monopolistic behaviors overseas exert exclusions and restrictions on 
domestic competition market, but not based on that if the victim is an overseas subsidiary of a 
Chinese undertaking.  
Page 96 (Para 3.146)  
In 2012 and 2013, the NDRC and the relevant provin cial-level authorities dealt with horizontal 
price-monopoly cases involving Samsung, LG and other liquid crystal display manufacturers; 
vertical price-monopoly cases related to price controls involving: the Kuichou Moutai Group, and 
the Wu Liangye Group, two large SOEs  in the white liquor industry;  
 Question 14 
The NDRC fined the Kuichou Moutai Group, and the Wu Liangye Group, two large SOEs in the 
white liquor industry controlling large market shares. Could China please provide the latest 
information on Anti-monopoly investigations against Chinese SOEs in other industries?  
 
Answer 
At the moment, the NDRC is carrying out anti-price -fixing investigations into many sectors like 
cement, automobile and parts, medicine industries, etc., not only on state-owned enterprises, but 
also on private enterprises, overseas-f unded enterprises and enterprises abroad. 
 Page 94 (Para 3.139)  
In July 2011, the NDRC, MOFCOM and SAIC signed an MOU on Anti-Monopoly/Anti-Trust Cooperation with the U.S. Department of Justice and the Federal Trade Commission. In May 2012, the NDRC signed an MOU on Anti-Monopoly/Anti-T rust Cooperation with the Republic of Korea's 
Fair Trade Committee. In September 2012, the NDRC and SAIC signed an MOU on Anti-Monopoly 
Cooperation with the European Commission's Department of Competition. China participates in competition policy-related activities in the context of APEC, the OECD, and UNCTAD. China is not a 
member of the International Competition Network and, as was reported in the previous Review, 
there is no a clear timeline for China to consider joining the network.  Question 15 
Does China have any plan to join the International Competition Network (ICN) to bring further cooperation in dealing with the international cartel issue?   WT/TPR/M/300/Add.1 
 
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 Answer 
The ICN is an unofficial international forum, and the accession should be on voluntary basis. 
Although China is not its member now, we have attached high attention to the international 
communication and cooperation in the anti-monopoly area and have achieved positive results. So 
far, the NDRC has signed memorandum of understanding and established cooperation with the anti-monopoly law enforcement agencies of the UK, the U.S., Rep. of Korea and the EU 
successively, reaching consensus on the contents and methods of the cooperation by establishing 
the long-term mechanism. Meanwhile, the NDRC enhances the communication with other anti-monopoly law enforcement agencies and learns anti-monopoly experience and practice from mature market economy countries through exchange visits and international seminars. 
 
Page 105 (Para 3.176)  
In the context of the present Review, the Chines e authorities have highlighted that since 2011, 
transparency in China's government procurement process has improved. In this connection, they 
point out the increasing resort to public-tende ring methods: the percentage of government 
procurement through public tendering now exceeds 80% and the use of single-source procurement 
has been reduced (see below). Also, efforts to make government-procurement-related information 
publicly available have been stepped up, as mo re documents linked to the procurement process, 
as well as the results of investigations and penalties imposed for misusing the procurement process, have been published.  
 
Question 16 
With regard to transparency, does China have a regular procedure to advertise government 
procurement and bidding information? If so, where can bidders access the information?  
Also, could China please explain what could be considered cases of "misusing" China's procurement system?  
 
Answer 
The Management Method on Information Notification of Government Procurement (MOF Order No. 19) provides specific regulations for information disclosure during government procurement. The 
Implementation Regulations on Government Procurement is being drafted to lay down further 
requirements for improving transparency of go vernment procurement. Government procurement 
suppliers can obtain information from MOF-designated online media, newspaper and magazines, of 
which, http://www.ccgp.gov.cn is the only onlin e media designated by the MOF. Procurement 
information can be searched and accessed at this website.  "Misusing" procurement procedure means the procurer or procurement agencies may influence or 
potentially influence the justifiable procuremen t outcome when preparing procurement documents 
and engaging in procurement process, and is involved in illegal practice when procurement 
outcome is being proceeded.  
Page 116 (Para 3.227)  
Copyright is implemented and regulated in China under the Copyright law, as revised in 2010, its 
implementing Regulation, last revised in 2010, and accompanying regulations, such as the 
Regulations for the Protection of Computer Software, the Regulation on the Collective 
Administration of Copyright, and the Regulation s on Protection of the Right of Communication 
through Information Networks.  
 
Question 17 
It is understood that China is in an ongoing pr ocess of reforming its Copyright Law. Could China 
please explain the substantial contents of th e final draft of the proposed Copyright Law 
amendment and provide more detailed info rmation on the revision schedule?  
 Answer 
Since 2011, the Chinese Government started the third round of revision to the Copyright Law. In December 2012, SIPO submitted the Copyright Law (revised draft version, submit for approval) to the State Council. In September 2013, the 12
th CPC Standing Committee officially listed the 
Copyright Law as category-I legislation for the coming 5 years, which means the condition is met 
for the draft to be submitted for review in this CP C term. Currently, the legisl ative Affairs Office of 
the State Council is reviewing the Copyright Law (rev ised draft version, submit for approval) and is WT/TPR/M/300/Add.1 
 
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 seeking public comment. For the main content an d instruction of the draft Law, please visit 
http://www.chinalaw.gov.cn/ for more information.  
Page 121 (Para 3.253)  
The Chinese Government has formulated and promulgated a series of documents such as the 
Opinions on Further Combating IPR infringement and Manufacturing and Selling Counterfeit and 
Shoddy Commodities, accelerated the process to  amend the Trademark Law, further improved 
trademark registration procedures and enhanced the protection of the exclusive right to use 
trademarks.   
Question 18 
Could China please provide further information on the current situation of the Trade mark Law 
amendment? Could China also clarify if the amendment contains 1) provisions to address the 
problem of so-called malicious trademark registration and, 2) reinforced measures on trademark 
infringement (especially in areas which might affect customer health, such as cosmetics)?  
Answer 
30 August 2013, Decision on Amending of the Trad e Mark Law of the People's Republic of China 
was examined and passed in the 4th meeting of the 12th Standing Committee of the National 
People's Congress. The Trade Mark amendment has taken effect in 1 May 2014. 
(i) The problem of malicious trademark registration 
The amendment adds the principle of honesty and credibility into the General Provisions. In addition, it stipulates that if an applicant who is  fully aware of the existence of others unregistered 
trademark due to contract, business contact or ot her relationship, registers others unregistered 
trademark on the identical or similar commodities, is refused to register. (ii) Strengthen the protection of exclusive right to use registered trade mark 
The amendment strengthens the protection of ex clusive right to use registered trade mark.  
1. Adding variety to the infringement of the exclusive right to use registered trade mark, explicitly stipulating that 'deliberately provide convenience to the infringement behaviors and help others 
implement the infringement behaviors to the exclus ive right to use registered trade mark belongs 
to the infringement behaviors to the exclusive right to use registered trade mark.  
2. Intensifying the punishment of the infrin gement behaviors. The amendment increases the 
amount of fines in accordance with the illegal revenue.  
3. Increasing punitive damages and raising the infringing damages. To those who maliciously 
infringe the exclusive right to use registered trad e mark, in serious cases, the amount of damages 
is determined within the scope of 1-3 times the am ount of the loss of the infringed, the benefit of 
the infringer or the license fees of the register ed trademark. Meanwhile, the damage limitation the 
court can decided according to the circumstance if any of the three above-mentioned basis can not be checked up is raised from 500,000 Yuan to three million Yuan.   
4. TRADE POLICIES BY SECTOR  
 Page 125 (Para 4.6)  
Local governments are mainly responsible for implementing the agricultural policies stipulated by the Central Government. The funds required to implement the programmes at the local level come in general from the central budget and are allocate d by the Central Government (e.g. agricultural 
"four subsidies", minimum purchase price and temporary purchase and storage polices, large-
country award policies and farmers' training projects) and local governments are usually only required to finance the administration costs. Local governments also finance the construction of infrastructure and utilities, cost of preventing epidemics, and the agricultural insurance premium 
subsidy.  
 Question 19 
What proportion of the total budget of the cent ral government goes to agricultural subsidies 
allocated to local governments? The budget item s for rural development are not designed in the 
way that WTO defines agricultural subsidies. Therefore, the figure is not attainable before 
substantive work has been put into analyzing an d re-categorizing the current budget. And we are 
not in the position to do so within the limited time.  WT/TPR/M/300/Add.1 
 
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 Question 20 
Which financial institutions have been guided to enhance financial support to the agricultural 
sector? Also, what kinds of measures were to guide these institutions?  
 
Answer 
The People's Bank of China has no requirement on the direction of credit. The financial institutions, 
as a independent market player, make their own decisions on lending or credit. 
 Page 134 (Para 4.43)  
By end 2012, four enterprises had obtained licences for basic telecommunication business and 
26,979 companies had obtained licences for value-added telecommunication business.  
 Question 21 
According to the report, by the end of 2012, 26,979 companies had obtained licenses for value-added telecommunication business, but among them only 34 were joint ventures (box 4.2 on page 
133). Does the Chinese government have any plans,  other than those for CSFTZ, to bring more 
openness to this area?  
 Answer 
China has always been endeavoring to push the fu rther opening up of the service market, and is 
willing to exchange views with other members on ways and means to achieve the objective in the 
Doha Round.  
Page 135 (Para 4.46)  
All but one (Internet data centre) of the 8 valu e-added telecommunication services categories 
have been liberalized as of March 2014 in the cont ext of the China Shanghai Pilot Free Trade Zone.  
 
Question 22 
Could China please explain why "Internet data centre" has been excluded from the liberalization package?  
 
Answer 
"Internet data centre" is not included in the commitment of China' accession to WTO. China will 
decide the specific procedure in line with development needs of the domestic market. 
 Page 157 (Para 4.124)  
The regulation imposes an extensive code of conduct on the sales agent and defines the level of qualification required for staff and their legal responsibilities, notably regarding the protection of data. In order to guarantee information safety and stability, service providers of foreign computer reservation systems are required by the new prov isions to establish back-up enquiry systems at 
designated places within the territory of China to keep sales agency informat ion, flight information, 
passenger information and other similar data generated by sales agencies of foreign air transport enterprises through the use of foreign computer reservation systems to make reservations and 
issue tickets within the territory of China. All foreign airlines (10) and all agents (15) that have so 
far applied for authorization under this new legal framework have obtained licenses.   
Question 23 
Now that foreign airline companies and agents have obtained licenses with the introduction of new 
regulations, what are the prerequisites for obta ining the licenses? Are there other requirements 
with which they have to abide in order to conduct business in China?  
 
Answer  
According to the Interim Provisions on the Administration of Licences for Sales Agencies 
Designated by Foreign Air Transport Enterprises with in the Territory of China to Directly Enter and 
Use Foreign Computer Reservation Systems (Dec ree No. 214 of the CAAC) and the Management 
Procedure on the Administration of Licences for Sales Agencies Designated by Foreign Air 
Transport Enterprises within the Territory of China to Directly Enter and Use Foreign Computer 
Reservation Systems (CAAC [2012] No. 7), foreign air transport enterprises shall file for application if they would like to directly enter and use Foreign CRS at the designated sales WT/TPR/M/300/Add.1 
 
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 agencies within the Territory of China. Foreign ai r transport enterprises and their designated sales 
agencies within the territory of China shall meet the following conditions:   
Conditions for foreign air transport enterprises: 
1
. According to bilateral air transport agreem ent or other related agreement, obtain 
 qualification license for operating regu lar international air transport business; 
2. Set up business office within the te rritory of China according to law; 
3. Sign system service agreement with foreign system provider; 
4. Other necessary conditions required by CAAC. 
Conditions for designated sales agenci es within the territory of China: 
1. Set up business office within the territory of China according to law and obtain corporate 
 capacity of China;  
2. Obtain qualification of international sales agency for passenger transport;  
3. Directly sign sales agency agreement with foreign airlines; 
4. Sign system service agreement with foreign system provider; 
5. Other necessary conditions required by CAAC. 
Foreign air transport enterprises and their sales agencies shall also abide by the Interim Provisions 
on the Administration of Licences for Sales Agencies Designated by Foreign Air Transport Enterprises within the Territory of China to Dire ctly Enter and Use Foreign Computer Reservation 
Systems (Decree No. 214 of the CAAC) when conducting business in China. 
 PART II Questions Regarding the Government Report   
2. ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMIC POLICY 
 Page 9 (Para 2.27)  
On 1 January 2013, the Regulations on Several Issues  Concerning the Laws Applicable to the Trial 
of Civil Cases of Dispute on the Infringement of the Right of Communication through Information Network promulgated by the Supreme People's Cour t took effect. China also amended a series of 
laws, regulations and rules concerning intellectual property rights such as the Trademark Law, the 
Regulations on the Protection of Computer Software, the Regulations on the Implementation of the Copyright Law, the Regulations on the Protec tion on the Right of Communication through 
Information Network, and the Regulation on the Pr otection of New Plant Varieties. The amount of 
compensation for IPR infringements has been raised, which is to the benefit of strengthening the 
administrative sanction and criminal punishment against IPR infringements.   
Question 24 
Korea appreciates the Chinese Government's efforts to enhance the protection of IPRs. Under 
Chinese Copyright Law, however, it seems there is no clause that imposes criminal responsibility 
on a person who has infringed on copyright-related rights. Could China please provide an opinion 
on this matter?   Answer 
In China, the criminal liability of copyright infrin gement is specified in Articles 217 and 218 of the 
Criminal Law, and judicial interpretation of the Su preme Court. In these regulations, any entity, be 
it group or individual, shall take criminal liability in case a crime is committed by copyright 
infringement. 
 Page 9 (Para 2.30)  
The country report states that in an effort to promote environment protection and pollution 
prevention/control, the Chinese government has raised market access criteria for certain 
industries, and strengthened compliance enforcement with regard to industrial standards for admittance into technology, energy consumption, environment protection and safety.  
 
Question 25 
Is there any possibility that the "increased market access criteria" may be applied to domestic and 
foreign manufacturers on a discriminatory basis? What are the details of the changed criteria, and 
which industries will they be applied to?   WT/TPR/M/300/Add.1 
 
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 Answer 
Except the restricted and prohibited category wr itten in the Catalogue of Industries for Guiding 
Foreign Investment (2011 Revision), market access criteria related with environment is applied to 
domestic and foreign enterprises equally. 
 3. TRADE AND INVESTMENT DEVELOPMENT AND RELATED POLICES 
 
Page 17 (Para 3.14)  
China's outbound direct investment showed expa nsion of scope and strong trend of growth. In 
2012, the non-financial direct investment made by investors from mainland China went to 4,425 
enterprises located in 141 countries and regions. Accumulatively, non-financial direct investment 
with the total amount of US$77.73 billion was realiz ed, showing a year-on-year increase of 13.3%. 
In 2013, investors from mainland China made non-financial overseas direct investment in 
5,090 enterprises in a total of 156 countries and regions. Accumulatively, nonfinancial direct 
investment with the total amount of US$90.2 billion was realized, showing a year-on-year increase of 16.8%. Guangdong, Shandong, and Jiangsu ranked  the top three places of overseas foreign 
direct investment.  
 Question 26 
According to CEIC statistics, the cumulative amount of non-financial direct investment realized was 
US$435 billion in 2012 and US$526 billion in 2013. Is  there any reason for the gap between the 
data sources?  
Answer  
We are checking with competent authorities. 
 
Page 17 (Para 3.14, 3.15)  
China's outbound direct investment showed expa nsion of scope and strong trend of growth. In 
2012, the non-financial direct investment made by investors from mainland China went to 
4,425 enterprises located in 141 countries and regions. Accumulatively, non-financial direct 
investment with the total amount of US$77.73 billion was realized, showing a year-on-year 
increase of 13.3%. In 2013, investors from mainland China made non-financial overseas direct investment in 5,090 enterprises in a total of 156 countries and regions. Accumulatively, 
nonfinancial direct investment with the total amount of US$90.2 billion was realized, showing a 
year-on-year increase of 16.8%. Guangdong, Shandong, and Jiangsu ranked the top three places of overseas foreign direct investment.  
China's outbound direct investment involves various sectors in national economy. In 2012 and 
2013, the top four sectors attracting investment included leasing and business services (US$26.74 billion, accounting for 30.4% in 2012; US$29.54 billion, accounting for 32.7% in 2013), 
mining (US$13.54 billion, accounting for 15.4% in 2012; US$20.16 billion, accounting for 22.4% 
in 2013), wholesale and retail (US$13.05 billion, accounting for 14.8% in 2012; US$13.67 billion, 
accounting for 15.2% in 2013), and manufacture (US$8.67 billion, accounting for 9.9% in 2012; 
US$8.68 billion, accounting for 9.6% in 2013).  
 
Question 27 
Could China please give relevant information on financial direct investment (as the report includes 
only information on non-financial direct investment)? Also, please clarify if the ranking for 
outbound direct investment includes the banking and insurance sectors.  Answer 
Accumulatively, direct financial investment with the total amount of US$10.07 billion was achieved in 2012.  
Page 23, 24 (Para 3.52, 3.53)  
China has also actively participated in other negotiations within the WTO framework on rules 
making and market access. China has been engaging in the negotiation on the product expansion 
of the Information Technology Agreement (ITA). Cu rrently the negotiation is at a stalemate, China 
is willing to jointly work with other parties to push the negotiation towards the right direction, with a view to finding a solution and reaching an agreement at an earlier date. China has always been an active participant and has played constructive role in the Trade and Environment negotiation WT/TPR/M/300/Add.1 
 
- 78 - 
 
  
 under WTO framework. In January 2014, China jo ined the initiative on environment goods 
negotiation with other 13 WTO Members in Davos, Switzerland, with a view to further discussion on reduction of tariffs of environment goods. China believes that trade and environment 
negotiation should aim to realize triple-win among trade, environment and development, and 
contribute to the multilateral trading system.   
Question 28 
Could China please explain in concrete terms its stance on the direction and outcomes of the ITA 
negotiation? Korea would also like to know what conditions China regards as necessary to conclude the negotiation in the near future. 
 
Answer 
ITA negotiation is still going on. When the negotiation could be concluded shall be dependent on 
the efforts of all participants. 
 Question 29  
In January 2014, China joined the initiative on environmental goods negotiation with 13 other WTO Members. Please elaborate on China's position  on the scope of environmental goods. Also, is 
there a real difference between its approach to the environmental goods negotiation and its approach to the ITA negotiation?  
 
Answer 
China believes that environmental goods negoti ation should build upon the APEC Leaders' 
commitment to reduce tariffs on the APEC List of  54 Environmental Goods. However, the coverage 
of environmental goods and the approach to the negotiation will be subject to discussion among 
participants in the future discussions. 
 
Page 24 (Para 3.56)  
China is accelerating its steps in negotiating free trade agreements. By the end of 2013, China has entered into 12 free trade agreements or closer economic partnership arrangements with 20 countries and areas ，with 10 of them implemented. Free trade agreements with Iceland and 
Switzerland are under domestic legislative procedures. Currently, China is negotiating on 6 free 
trade agreements with 22 countries and regions.  
 Question 30 
Could China please give information on the objectives and specific plans of China's trade policies for 2014, including regional trade agreements? Also, what is China's position on the Trans-Pacific Partnership (TPP) currently under discussion?   
Answer 
In 2014, China will take a strategic approach to pr omote export upgrade and balanced trade, with 
total import–export volume increased by 7.5%. Export policy will be stabilized and improved, 
customs clearance facilitation reform will be accelerated, cross-border E-commerce pilot will be 
expanded, and trade facilitation will be further enhanced. Import incentive policy will be implemented, and domestic product gap will be fille d in by import. Processing trade will be guided 
to transform and upgrade, enterprises will be supported to develop international marketing 
network, and service trade and serv ice outsourcing will be fostered, so that effort will be made to 
elevate China's position in the world labor division of manufacturing. Foreign trade structure will be optimized, and attention will be on increasing the share of emerging market, central and western 
regions, private enterprises, medium and small enterprises, new and hi-tech and brand products in 
foreign trade.  WT/TPR/M/300/Add.1 
 
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 ADDITIONAL QUESTIONS BY THE REPUBLIC OF KOREA 
PART I: Questions Regarding the Secretariat Report 
 
Page77 (Para 3.80) 
 Inspection procedures for imports and exports subject to SPS measures have not undergone any 
changes since 2010. All imports and exports listed under the Catalogue must be presented to the 
entry and exit inspection and quarantine authoritie s. If the goods subject to statutory inspection 
have not been inspected, they are not allowed to be sold or used in the Chinese territory.   
Question  
The Chinese Government only recognizes testing reports issued by China Exit-Entry Inspection and Quarantine Agency in accordance with Article 52 of the China Food Safety Act while the Korean 
government has designated 27 Chinese inspection institutes as foreign official laboratories and 
recognizes their reports in the process of import clearance. Accordingly, Korea would like to ask when the Chinese government will make an amen dment to the Chinese Act to recognize reports 
issued by such inspection institutes.  
 Answer 
China has implemented registration administration of health foods pursuant to the China Food 
Safety Law and the Measures for the Registration Administration of Health Foods (Trial) (No.19 
Order of the State Food and Drug Administrati on (SFDA)). Due to different inspection and 
evaluation criteria among different countries, an overseas inspection report may be used as a 
helpful reference for evaluation rather than a direct basis for product review during registration. 
Currently, the SFDA is taking the opportunity of the amendment to the Food Safety Law to accelerate reform on the administrative examin ation and approval system of health foods and 
research classified management model combining product registration and filing by following the 
principle of risk management.   PART II: Questions Regarding the Government Report 
 
Page 11 (Para 1-4)  
The Chinese Government has made a great stride in the reform of the administrative approval 
system, as it cut down investment items requiring administrative approval, slashed approval requirements in production and operating activities, and reduced qualification requirements as well 
as administrative and institutional fees and charges.  
 Question  The Chinese Government still does not recognize test reports issued by international certified 
bodies, which are accepted by the EU, Japan, Ko rea and the U.S., but rather only accepts test 
reports issued by Chinese certified bodies with regard to approval for medical devices. This practice requires substantial time and efforts and increases expenses for foreign traders exporting 
medical devices due to the duplicated approval system. Likewise, each individual health functional 
foods import requires the approval of the CFDA , which increases the time and expense of the 
CFDA's revaluation processing spite the fact that the safety and functionality evaluation data have 
already been submitted. 
With regard to the aforementioned situation, th e Korean government would like to ask when the 
Chinese government will make an amendment to the relevant Chinese act to recognize test reports issued by international certified bodies in the case of medical devices, and evaluation data 
submitted by such bodies in the case of health functional foods. 
 Answer 
We are in the process of consulting with competent authorities for reply.  WT/TPR/M/300/Add.1 
 
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 Page 135 (Para 4.46, 4.47)  
 All but one (Internet data centre) of the eight value-added telecommunication services categories 
have been liberalized as of March 2014 in the co ntext of the China (Shanghai) Pilot Free Trade 
Zone (CSPFTZ), under the following conditions: for domestic multiplayer telecommunications services, storage and forwarding business, call 
centres, Internet access services and the apps tores segment of information services, wholly 
foreign-owned companies are now allowed; for online data processing and transaction processing, the maximum foreign participation is raised to 55% except for the e-commerce segment (previously closed to foreign investment) where it is 
raised to 50%; IP and VPN business as well as information services other than appstores are also 
subject to a threshold of foreign ownership raised to 50%; companies established in the CSPFTZ will be allowed to provide their services from the FTZ to the 
entire territory of China except for Internet a ccess services whose geographical scope will be 
limited to the CSPFTZ. This additional liberalization has to be compared to China's WTO commitments where only three of 
the 8 value-added telecommunications services (electronic data interchange, storage and 
forwarding and information services) were bound and at the level of maximum foreign ownership of 30%.  
Question 
Do MMOG (Massively Multiplayer Online Game) services fall within the scope of multiplayer telecommunication services? Could China please clarify the meaning of the term "multiplayer 
telecommunication services", and present a list of what kinds of telecommunication services fall 
within the scope?   
Answer 
According to the Catalogue of Telecommunication Business Classification, domestic multiplayer 
telecommunication services mean interactive or on-demand voice and image communication services via communication network between two or among multiple domestic points. Domestic 
multiplayer telecommunication services include domestic multiplayer telephone services, domestic 
video conference services and domestic Internet videoconferencing and image services. MMOG does not fall within the scope of domestic multiplayer telecommunication services.  
 
Question  Could China please explain in detail for each of the 8 value-added telecommunication services 
which parts are more liberalized compared to the GATS schedules of specific commitments? 
 Answer 
According to value-added telecommunication services to be opened subject to China's WTO 
commitments and China's existing Catalogue of Telecommunication Business Classification, specific 
opening fields are information services, storage and forwarding services as well as online data handling and transaction processing services, with foreign equity ratio less than 50%.  
 
In the China (Shanghai) Pilot Free Trade Zone, China has further opened value-added 
telecommunication services on a pilot basis based on WTO commitments. Firstly, we have relaxed 
restrictions on foreign equity ratio of the thr ee business opened subject to WTO commitments. We 
have removed the restriction of foreign equity ratio on App store services, storage and forwarding services of information services, and have relaxed the restriction of foreign equity ratio on business ecommerce services of online data processing and transaction processing services to 
55%. Secondly, we have added new pilot openin g call center services, domestic multiplayer 
telecommunication services and Internet access serv ices for internet users and domestic Internet 
virtual private network (VPN) services, with no rest riction on foreign equity ratio for the first three 
services, but has imposed the restriction of foreign equity ratio less than 50% to domestic Internet 
virtual private network (VPN) services.   WT/TPR/M/300/Add.1 
 
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 Question  
Could China please confirm whether the licensing procedures for ISP and ICP are included in its 
mitigation policies for value-added telecommunicati on services stated in the report? Is there any 
plan to integrate China's complex regulatory regime and establish or designate a unified authority 
to deal with internet regulations within the CSPFTZ ? Also, is there any possibility of withdrawal or 
cancellation of the benefits for the 8 value-adde d telecommunication services within the CSPFTZ? 
 
Answer 
In 2014, China issued the Administrative Measures for the Pilot Operation of the Value-Added Telecommunications Business by Foreign Investors in China (Shanghai) Pilot Free Trade Zone to 
delegate the power of examination and approval to the Shanghai Communications Administration 
and consolidate and simplify examination procedures . Internet administration involves multiple 
departments and should be studied according to the experiment situations of the CSPFTZ.  WT/TPR/M/300/Add.1 
 
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 10  PREGUNTAS DE CHILE 
Pregunta 1 
En el marco del Capítulo 3.1.9 ( "Sanitary and phytosanitary requirements")  y en relación con los 
párrafos 3.79 y 3.80,  ¿ha pensado algún plan el Gobierno de China para modificar o agilizar su 
sistema de aprobación sanitaria de manera que sea más dinámico?   
Answer 
The current approval system for inspection an d quarantine of China complies with the WTO's 
provisions of the Agreement on the Application of  Sanitary and Phytosanitary Measures (SPS). The 
Chinese Government will keep perfecting the appr oval process. We also appreciate opinion and 
suggestion from Chile on motivating the approval system for inspection and quarantine of China. WT/TPR/M/300/Add.1 
 
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 11  QUESTIONS BY CHINESE TAIPEI 
PART I: REGARDING THE SECRET ARIAT REPORT (WT/TPR/S/300)  
 
1. ECONOMIC ENVIRONMENT 
1.1 Recent Economic Developments  1.1.2.2 Structural Reform Measures  
 
Page 19 (Para 1.21)  China has continued to apply policies to promote employment during the period under review. China's policy on employment is mainly contained in the Employment Promotion Law adopted in 
2008. The Law also calls for improving the employment assistance system; strengthening public 
employment services including by directing the transfer of the surplus workforce in rural areas; strengthening vocational training and gradually promoting flexible employment systems as part-
time employment.  
 Question(s) 
1. Given the strong trend in recent years towards the signing of regional free trade agreements and the possible impact of further trade liberalization on the job market, is China planning any corresponding employment promotion measures in Answer?   
Answer 
Please refer to China's Employment Promotion Law. 
 
Page 20 (Para 1.22) 
 To achieve the first goal, the PBC guided financial institutions to intensify financial support to areas 
such as scientific and technological innovation, emerging industries of strategic importance and the 
service industry.   Question(s) 
2. Could China please share with us the results of the measures implemented to achieve the first 
goal?  3. How does the PBC guide and encourage financial institutions to intensify support to the above-
mentioned emerging industries? 
 Answer 
The purpose of developing strategic emerging indust ry in China is to adjust economic structure, 
transform economic development mode and enhanc e industry competitiveness. The development 
plans for strategic emerging industry released by Chinese central and local governments belong to guidance document. In the Decision on Accelerating the Fostering and Development of Strategic 
Emerging Industries and the Development Plan for Strategic Emerging Industries during the 12
th 
Five-year Plan Period, China announced to enha nce international cooperation, guide foreign 
investment towards strategic emerging industry, expand foreign investment channel and improve 
soft environment for foreign investment. In fo stering and developing emerging industry of 
strategic importance, China will fulfil its WTO commitment and follow the market principle. The policy for strategic emerging industry released by the Chinese government is applicable to eligible 
foreign investment enterprises.  
 Page 21 (Para 1.23)  Under the Opinions of the State Council on Further Supporting the Healthy Development of Small 
and Micro Enterprises, the People's Bank of China (PBC) must guide financial institutions to 
enhance support for the development of SMEs, es pecially small and micro enterprises, and to 
improve the financial services available to them. A variety of monetary policy instruments, such as 
differentiated reserve ratio requirements, are used for credit policy implementation. In 
September 2012, the PBC and CBRC promulgated th e Notice on Implementing the Spirit of the 
CPC Central Committee with Regard to Improving Fi nancial Services and Related Issues, requiring 
financial institutions to improve the provision of financial services to agriculture, farmers and rural 
areas, and small and micro enterprises, so as to effectively meet the financing needs of the real economy.  WT/TPR/M/300/Add.1 
 
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 Question(s) 
The PBC applies differentiated reserve requirement ratios. The PBC has guided financial institutions 
to increase financial support to key sectors of th e economy such as agriculture, rural areas, and 
farmers, has cut the reserve requirement ratios for county-level rural commercial banks and 
county-level rural cooperative banks by 200 and 50 basis points respectively, since 25 April 2014.   
4. By how much are the above-mentioned measur es expected to increase agriculture-related 
loans?  5. What does China's predict will be the NPL rati os of the incremental agriculture-related loans?  
 
Answer 
The People's Bank of China has no requirement on the direction of credit. The financial institutions, 
as a independent market player, make their own decisions on lending or credit. 
 
Page 21 (Para 1.24) To this end, in 2012, the PBC expanded the covera ge of the payment and clearing network in rural 
areas by providing that over 70,000 outlets of fi nancial institutions in rural areas should be 
connected to the PBC's payment and clearing system s, opening the channels for transfer of funds 
in rural areas.   
Question(s) 
6. Please elaborate further on how foreign banks obtain access to the PBC's payment and clearing 
network in rural areas?  
7. Compared to domestic banks, do any additional requirements or restrictions apply to foreign 
banks wishing to participate in PBC's payment and clearing systems?   
Answer 
At present, 3,500 banks, including foreign-invested banks dealing with RMB settlement business, 
have directly or indirectly participated in the settlement system of The People's Bank of China. We have no special limitation or requirement on the market access of foreign invested banks. 
 
2. TRADE AND INVESTMENT REGIME 2.2.2 Trade policy objectives  
 
Page 38 (Para 2.20)  China's overall main trade policy objective is to accelerate its opening up to the outside world. The 
Third Plenary Session of the 18th National Congress of the Communist Party of China (CPC) held in 
November 2013 approved a Decision on Major Issues Concerning Comprehensively Deepening Reforms. The Decision calls for the construction of a united and open market system with orderly 
competition that will play a decisive role in allocating resources.  
 
Question(s) 
8. Does China have concrete plans for the construc tion of such a united and open market system?  
9. If so, could China please provide details of th e anticipated timeframes and how the allocation of 
resources is likely to affect its trade or ec onomic cooperation with fellow-WTO Members?  
 
Answer 
Going forward, China would work hard to clear up all incentives, to set up a well-regulated 
standard for environment, security, energy consum ption, and land use so as to put in place a 
unified and open market system. Beyond that, we will institute a unified, fair and transparent 
system for investment access. China carried out reforms in current approach of approval and 
examination for foreign investment projects and explored the administrative approach of "Pre-
entry National Treatment plus Negative List. Besi des, we would further deregulate such service 
sectors as education, culture and healthcare, and make the development of service sector more 
effective so as to meet people's diversified need s. China will also accelerate the development of 
mixed-ownership economic entities. That means we will press ahead with the reform of diversity of 
equities in SOEs and build up corporative mechanism for public and private capital. The enterprises  
and investment companies concerning national secu rity can be solely state-owned. With exception 
to them, the state-owned capital in other sectors and fields can hold shares or have joint shares in business operation. On top of that, we will speed up  efforts to eliminate laws, regulations, charts WT/TPR/M/300/Add.1 
 
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 or regulatory documentaries which curb non-public economy, and encourage private capital to 
invest in central-led enterprises and to have access to franchise areas. Meanwhile, we would lift restriction on all competitive fields including those competitive businesses in the monopolized 
sectors of nature so as to give full play to private capital. That being said, we should act in line 
with laws and regulations in developing mixed ownership to prevent the losses of state-owned asset.   
 
Page 38 (Para 2.21)  A National Leading Group for Comprehensive Deepen ing Reform was established as a result of the 
Plenary Session's decision; it is tasked with the responsibility of setting a reform roadmap, and 
with the coordination, promotion, and supervision of the decision's implementation. To this end, 
under the Leading Group, six subgroups were established: (a) economic reform and environmental protection; (b) democracy and rule of law; (c) cultural issues; (d) social issues; (e) reform of the 
Party's building system; and (f) disciplinary inspection (anti-corruption).  
 Question(s) 
10. Has China formulated any policy measures specifically designed to push forward economic reform and environmental protection?  11. If so, could it please elaborate further on these measures and the anticipated timeframes?   
Answer 
Next, the Chinese Government will reverse the trend of ecological environment deterioration at the 
source. It will make the ecological space protection system more stringent, and establish a land-
sea coordinated regional linkage mechanism for ecosystem protection and restoration and pollution 
prevention. It will explore the preparation of the balance sheet of natural resources, strengthen 
protection for high-value natural land space, and change the extensive use of natural resources. It 
will promote the establishment of inter-regional and inter-basin ecological compensation 
mechanism, and promote the formation of an ecological compensation system highlighting 
comprehensive compensation, classified compensation, transfer payment, lateral compensation and market transaction. It will improve the syst em of compensation for the use of resources, 
compensation for the environmental damages, an d environmental pollution liability insurance. 
 12. Moreover, is it possible that these measures might result in green trade barriers?  
 
Answer 
To faithfully deliver on deepening the reform in  eco-friendly sector, the Chinese Government has 
come up with a host of roadmaps, timetables and policies as follows:  
We will refine the environment policies, laws and regulations, and revise the Environmental 
Protection Law. Beyond that, we would strengthen the coordination in environmental stewardship and macro-management function, and work to put in place a social credit system in the 
environment protection. Besides, we would raise the standards for levying pollution charges, and 
work to formulate environment-friendly tax breaks in non-electricity sectors. The newly revised Laws on Environment Protection will be put in place on 1 January 2015. 
We will work intensively to map out guidance on how to foster the national redline for eco 
protection. We will deepen the reform on the environment assessment and review system, simplify the 
approval procedures, and revise Regulations on  the Administration of Construction Project 
Environmental Protection. We will refine the pollution permit system and the systems for total emission control in public institutions 
 WT/TPR/M/300/Add.1 
 
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 2.4.1 Reciprocal agreements 
 Page 40 (Para 2.39)  
China is currently negotiating FTAs with the Gulf Cooperation Council (GCC) countries, Australia; 
Norway; Korea, the Republic of and Japan.  Question(s) 
13. Could China please elaborate further on these ongoing FTA negotiations in terms of their status, latest progress and anticipated timeframes?  14. What is China's view on the likelihood of the China-Korea FTA being concluded by the end of 
this year?  
 
Answer for questions 13 and 14 
China is negotiating free trade agreements with  South Korea, Gulf Cooperation Council (GCC), 
Australia and Norway, respectively; it is also involved in China-Japan-ROK FTA negotiations and 
RCEP negotiations. The progress is as follows: 
1)  China- ROK FTA negotiations officially started in May 2012, and 11 rounds of negotiations 
have been completed so far. 
2)  China-GCC FTA negotiations started in July  2004, and 5 rounds of negotiations and 
2 working group meetings on trade in goods have been completed so far. 
3)  China-Australia FTA negotiations started in April 2005, and 20 rounds of negotiations have 
been completed so far. 
4)  China-Japan-ROK FTA negotiations officially started in November 2012, and 4 rounds of 
negotiations have been completed so far. The 5th round of negotiations will be held in 
early August in China. 
5)  RCEP negotiations started in November 2012, and 5 rounds of negotiations have been 
completed so far. 
6)  China-Norway FTA negotiations officially started in September 2008, and 8 rounds of 
negotiations have been completed so far.  
2.5.1 Regulatory framework and market access  
 
Pages 42-43 (Para 2.46)  The Catalogue for the Guidance of Foreign Investment Industries (Investment Catalogue) is the 
main reference for the classification of projects . It lists the industries that are encouraged, 
restricted or prohibited. The Catalogue was revised in 2011 to reflect the goals adopted in the twelfth Five-Year Plan (2011-2015). The revised Catalogue is considered a step towards further 
opening up the economy as it included more projects in the encouraged category, removed some 
from the restricted and prohibited categories, and relaxed some restrictions on the form of investment in certain industries (Table 2.2).   
Page 44 (Para 2.52)  
In accordance with the Anti-Monopoly Law, FDI in the form of mergers and acquisitions (M&As) of 
enterprises is subject to anti-trust reviews.33 Th e reviews are intended to assess the impact of 
such M&As on market competition. In addition to anti-trust reviews, FDI involving M&As with 
Chinese domestic enterprises is subject to nation al security reviews, if the FDI is related to 
defence, or is deemed to have an influence on national security, for example through control of 
firms engaged in activities involving key commodities (e.g. agriculture, energy, and natural 
resources), key infrastructure, key transport, and key equipment manufacturing with essential 
technologies.  
 
Question(s) 
15. Does the FDI review mechanism apply to all energy sources?  
 
Answer 
Yes. 
 
Question(s) 
16. When foreign experience of certain industries  such as shale gas exploration and development 
is needed, how does the Government share technology and experience with other countries while the FDI evaluation indicates a possible risk to national security?  WT/TPR/M/300/Add.1 
 
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 Answer 
In line with Catalogue of Industries for Guiding Foreign Investment, the extraction and exploration 
of nonconventional natural gas such as shale gas, marine gas hydrate falls into the foreign 
investment encouraging type. Foreign investment in  shale gas exploration should take the form of 
corporation in line with Exploitation of Onshore Oil Resources in Cooperation with Foreign Parties Regulations and Exploitation of Offshore Oil Resources in Cooperation with Foreign Parties 
Regulations. 
Sino-foreign joint exploration of shale gas can be conducive not only to the industrial development 
and technological advancement but also to th e international energy security. The Chinese 
Government takes positive approaches to Sino-foreign partnership in oil exploration and remains 
committed to the protection of legitimate invest ments and outcomes of foreign enterprises.  
 2.5.2.1 Inward Investment 
 
Pages 45-47 (Paras 2.55-2.64)  The National Development and Reform Commission (NDRC) of China has promulgated a series of 
laws and regulations on Inward investments or FDI. Among them, Measures for the management 
of government investment projects approved (GuoFa [2014] No. 11) and Administrative Measures on the Approval and Filing of Foreign Direct Investment (GuoFa [2014] No. 12) have recently entered into force and it is our understanding that they may have the effect of materially altering 
some of the examination and approval procedures relating to foreign direct investment project 
applications.   
Question(s) 
17. What are the main features of these two regulations, and of any others that may enter into 
effect this year?  
18. What are the main effects of the amendments made this year compared to the previous 
editions of the laws and regulations?   Answer 
Measures on the Government Verification of In vestment Projects and other related regulations 
have the following striking features: simplify procedures, streamline administration. First, these regulations can allow enterprises to have full voice in investment decision-making because they 
can have ultimate say in these investment deci sions from the "internal conditions" perspective 
such as market prospect, economic returns, sources of funds and plans for products and technologies. Secondly, the regulations simplify the approval contents and procedures. The 
approval agencies will, for the sake of public in terests, check on the "external conditions" of the 
projects. These "external conditions" have a bearing on economic security, reasonable use of resources, eco stewardship, optimal layout, public interest, and monopoly prevention.   
This may witnessed the Measures on Verification and filing of Foreign Investment Projects by 
NDRC. This measure has moved away from the full verification to the combined management of limited verification and filing. Beyond that, we also put in place pre-establishment national 
treatment for foreign investment and further simplify the approval contents and procedures on 
foreign investment projects. In this connection, we could strengthen the market players of enterprises and further promote investment facilitation.  
 
2.5.4 China (Shanghai) Pilot Free Trade Zone (CSPFTZ)   Page 51 (Para 2.78)  
The authorities indicated that the launching of the CSPFTZ is a national strategy to deepen 
reforms. Since it is a Pilot Zone, policies will be tested in the Zone and this will serve as a showcase for further trade and investment liberalization nationwide. The authorities also indicated 
that Shanghai was chosen because it had traditionally been at the forefront of China's reform 
policies. The CSPFTZ is meant to expand and op en up the service sectors and to reform the 
investment administration mechanism, push forw ard trade transformation, deepen the opening up 
of financial services, and create a new mode of supervision and service.  
 WT/TPR/M/300/Add.1 
 
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 Question(s) 
19. Does China have plans to launch any other pilot free trade zones in the near future? If so, 
where? And, will similar liberalization measures be applied?  
 
Answer 
China has only approved China (Shanghai) Pilo t Free Trade Zone, with the purpose of forming 
replicable experience for nationwide reform an d opening up. China will study the feasibility of 
launching similar pilot free trade zones in other re gions according to the need of further promoting 
the reform and opening up nationwide and based on the assessment of China (Shanghai) Pilot Free Trade Zone. 
 
Page 52 (Para 2.84)  The report indicates that The "Special Admini strative Measures (Negative List) on Foreign 
Investment Access to the China (Shanghai) Pilot Free Trade Zone (2013)" (the "Negative List"), is 
mainly based on the "Framework Plan for the China (Shanghai) Pilot Free Trade Zone," and the "Catalogue of Industries for Guiding Foreign Investment (2011 Amended Version)", and sets out 
administrative measures applicable to foreign investment projects and establishment of FIEs in the 
CSPFTZ where "national treatment" is not granted.  The Negative List is compiled according to the 
"Classification and Codes of National Economic Industries (2011)" and includes 18 sectors or industries. Two sectors: public management, social security and social organizations; and 
international organizations, are not subject to the Ne gative List. The Negative List will be adjusted 
when deemed appropriate.   
Question(s) 
20. How will the Negative List for investme nts in the CSPFTZ be amended this year?  
 
Answer 
Currently, Shanghai is revising the Special Administrative Measures (Negative List) on Foreign 
Investment Access to the China (Shanghai) Pilot Free Trade Zone (2013) by following openness and transparency principle and complying with international norm.  
 
Page 54 (Para 2.92)  In accordance with the Policies and Measures on  the Capital Market for Supporting and Promoting 
the China (Shanghai) Pilot Free Trade Zone, published by the China Securities Regulatory 
Commission on 29 September 2013, the China Securities Regulatory Commission (CSRC) will deepen capital market reform, and further promot e its opening-up through a number of specific 
measures, including: (a) consenting to the establishment of the Shanghai International Energy 
Trading Center Co., Ltd. in the CSPFTZ by the Shanghai Futures Exchange, to be responsible for 
establishing a trading platform for international crude oil futures. Foreign investors may participate in domestic futures trading using the platform; (b) qualified entities and individuals in the CSPFTZ 
may make investments in foreign and domestic securities and futures markets,  
 4. TRADE POLICIES BY SECTOR  
4.2.2.2.3 Recent regulatory changes in th e securities and stock exchange sectors  
 Page 142 (Para 4.76)  
Fifth, regarding trading in futures, the "Regulations  on the Administration of Futures Trading" were 
amended on 24 October 2012 so as to allow foreign institutions conforming to requirements to participate in specific futures trading. Crude oil w ill be the first of these trading areas to be opened 
up. The other types of trades that will be allowed have not yet been determined. The China 
Securities Regulatory Commission (CSRC) is presently studying and preparing the relevant 
measures. Qualified foreign institutional investors may participate in stock index futures trading, while other foreign entities or individuals may not.  
 
Question(s) 
21. Who are expected to be the other participants in the crude oil futures market, in addition to 
state-owned enterprises (SOEs)? 
22. In what way does the government plan to reform the market surveillance institution and foreign currency exchange systems?   WT/TPR/M/300/Add.1 
 
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 Answer for questions 21 and 22 
Recently, Chinese government has sped up the efforts to upgrade the concepts and modes of 
foreign exchange management. Beyo nd that, we work hard to streamline the administration and 
delegate power to lower levels, scrap or deregulate pre-approval, and promote trade and 
investment facilitation. In cross-border securities and stock investment, we have made deep deregulation and cut on the relevant exchange links  and procedures as follows. First, we have lift 
restrictions on currency for QDII funds remitted. Meanwhile, we work to expand the capital source 
for cross-border securities investment by domestic institutions, and remove the procedures for settlement and purchase of foreign exchange. Seco ndly, we should simplify and scrap the approval 
procedures for currency exchanges for domestic ente rprises to be listed abroad. Thirdly, we should 
simplify and refine foreign currenc y management related to derivatives transactions abroad by 
domestic enterprises. Down the road, Chinese government would step up its effort to streamline the administration and delegate power to lower levels, and work hard to promote capital account 
convertibility so that markets can play a decisive role in resources allocation.  
 3. Trade Policies and Practices by Measure  
3.1.8 Standards and other technical requirements  
 Page 74 (Para 3.69)  As mentioned in the report, procedures to develop and issue a standard and a technical regulation 
(also referred to in China as "mandatory" standard) are similar but with some differences, and that 
a (voluntary) standard could be quoted in a technical regulation and thus it would become mandatory.  
 
Question(s) 
23. It would be appreciated if China could plea se explain further the differences between the 
development and issuance of a voluntary standard and a mandatory standard, in particular those 
aspects concerning the nature of the standard (i.e ., whether it is intended to be mandatory), the 
examination procedure, and the comment period.   
Answer 
Mandatory standards and recommendatory standards are different in establishing procedures. 
First, in the link of project determination, the au thority department will have expert review on its 
necessity and viability. Secondly, in the link of te chnical review, conference trials are needed for 
recommendatory standards. Thirdly, prior to the approval, we should make public recommendatory standards in line with the rules of  WTO/TBT when the standards involve trade.  
 
Page 74 (Table 3.6)  The Table shows that the three kinds of standards in China, national, sectoral and local, may be either mandatory or voluntary.  
 
Question(s) 
24. What percentage (proportion) of the national  standards has been adopted from international 
standards and how is this percentage calculated? Is the common denominator the total number of 
national standards or is it the number of national standards for which there are corresponding existing international standards? What then are th e equivalent percentages for the sectoral or local 
standards adopted from international standards?  
 Answer 
As of the end of 2013, 73.52% of China's national standards have met with international 
standards. It's has been calculated in the formula: the adoption of international standards / the 
index of national standards corresponding to inte rnational standards. Region-wise, those standards 
have local features. According to statistics available, none local standard has met the international 
standards.  
 Question(s) 
25. Are mandatory sectoral standards that are developed by the standardization administrations of 
the competent ministries and mandatory local standards that are developed by local government 
also technical regulations? And, are they notified  to the WTO in accordance with Article 2.9?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
Since accession to the WTO, the Standardization Ad ministration of the People's Republic of China 
has conscientiously fulfilled its responsibilities for notifying mandatory national standards and  
responding to comments and consultations under WTO commitments in strict accordance with 
WTO procedures and requirements. It notifies the WTO Secretariat of any draft mandatory national 
standard relevant to international trade in accordance with WTO requirements and solicits 
comments from WTO member states. 
 Whether it is necessary to notify the WTO of a draft mandatory national standard is mainly determined based on the requirements in th e TBT Agreement and SPS Agreement: the draft 
national standard shall be notified to the WTO, if there is no international standard relevant to the 
draft national standard, or the technical content of the draft national standard is not in line with the technical content of the relevant international standard, and the draft national standard may 
have a significant effect on the trade of other WTO member states; there is no need to notify the 
WTO of the draft national standard, if the draft national standard is equivalent to an international standard, regardless of its impact on trade. 
 
26. Irrespective of the exact form of the standard, would a technical regulation take the form of a law, an Act or an administrative order, (e.g. the Rules of the China Compulsory Certification System)? If so, what points should be considered in determining the appropriate format for a 
technical regulation?  
 Answer 
The Standardization Law stipulates that compulsory  industrial standards and compulsory local ones 
are formulated by industrial standard authority and local standard authority and keep WTO/ TBT informed. The nature of these regional and national standards are consistent and an integral part 
of our technical regulations. On top of that, notifications are needed when local standards short of 
international standards seriously disrupt international trade.  Page 75 (Para 3.75)  
There are 13 mandatory certification bodies authorized to provide certification for products subject 
to CCC.   
It is our understanding that these certification bodies are all domestic organizations in China. It is 
further noted that at the 24th China-US Joint Commission on Commerce and Trade, China affirmed that applications from foreign- invested entities to be design ated CCC testing and certification 
bodies will be accepted in Spring 2014.  
(http://www.ustr.gov/about-us/pr ess-office/fact-sh eets/2013/December/JCCT-outcomes).  
 Question(s) 
27. We would appreciate a latest update from China on the progress made in relation to these arrangements.   
Answer 
In the 24th China-US Joint Commission on Commerce and Trade of 2013, China has pledged that 
qualified foreign banks should share the same benefits as the domestic banks in the China 
Compulsory Certification and the assigned guidance  work in the lab. As the supporting measures 
and others are to finish, the application of foreign banks can be part of the assigned guidance work in the spring of 2014.   
In June 2014, Certification and Accreditation Admini stration of the People's Republic of China has 
issued the notice concerning the Demand of Certain Certificate Authorities and Lab for Compulsory Products. With regard to the specific arrangement, Certification and Accreditation Administration of 
the People's Republic of China would go about it s work in line with Regulations of the People's 
Republic of China on Certification and Accreditat ion, and Measures for Control of Certification 
Bodies, Inspection Bodies and Laboratories De signated for CCC (the Decree No. 65 by State 
General Administration of Quarantine).  
 CNCA would lay equal stress on the eligible domestic banks and foreign ones, and would go into the principles of reasonable use of resources, fair competition and convenience and efficiency.  WT/TPR/M/300/Add.1 
 
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 3.2.3 Export prohibitions, restrictions, and licensing 
 Pages 81-82 (Para 3.97) 
The list of products subject to quotas and the total amount of the quotas for the following year is 
published on 31 October of each year. Between 1 and 15 November of each year, exporters must apply for an export quota for the following year. Export quotas must be allocated before 
15 December of each year, in accordance with Articles 38 and 39 of the "Regulation of the People's 
Republic of China on the Administration of the Import and Export of Goods". The allocation of 
quotas must be decided within 30 days of receiving the applications and no later than 15 December of the current year. Export quotas ar e allocated either by NDRC or MOFCOM directly, 
or through a bidding process. Once the exporter obtains a quota, it needs to apply for a licence 
(Table 3.10). Unused quotas must be returned before the end of the year for which they were allocated. Exporters need to present the certificate of quotas to clear Customs.  
 
Question(s) 
28. Could China please provide details of the eval uation criteria and required procedures for the 
export quota certification of coal by the NDRC and for the export quota certification of crude oil by 
the MOFCOM?   Answer 
An enterprise gets to know its coal export quota by written notice. Upon receipt of the notice, the 
enterprise shall collect the export licenses from the Quato and Licence Administrative Bureau of the Ministry of Commerce. The coal export quota to  an enterprise shall be determined by reference 
to the enterprise's actual coal export performanc e in the previous year, and this standard remains 
unchanged. Please refer to the Measures for the Ad ministration of Quotas for Coal Export (Decree 
No. 7 jointly issued by the National Development and Reform Commission, Ministry of Commerce, 
and General Administration of Customs on 7 January 2004) for details. 
 29. Do the evaluation criteria remain the same each year?   
Answer 
Coal export quota in written form can allow enterprises to get the export license from the license 
business Bureau under MOFCOM which remains committed to the principle that this quota would 
take into consideration the export performance one year before. You can refer to for details 
Regulations on Coal Export Quota (the Decree No.7 by NDRC, MOFCOM and General Administration of Customs. In line with Regulations on Sino-foreign Corporation in Marine 
Petroleum and Regulations on Sino-Foreign Corporation on Onshore Oil Exploration, the foreign co-
operators can shift their quota abroad. Currently, China's export quota of crude oil should be 
exported through corporation.   
3.3.1 Incentives 
 Page 88 (Para 3.122)  
Specific industries such as emerging industries, high and new technology industries, industries that 
promote energy conservation and environmental prot ection151, industries related to public welfare 
and public infrastructure, which would not otherwise attract capital, are supported by the State. 
The objective of these support programmes is to promote innovation, upgrade industries, and 
protect the environment and green development.   Question(s) 
30 It would be appreciated if China could please provide details of government measures and support programmes for industries related specifically to energy conservation.   
Answer 
During review, China has rolled out a host of policies on energy conservation as follows: 
In August 2013, the State Council issued Opinions on Fostering Energy-Friendly Sectors (Guo Fa 
[2013] No.30). This Opinions has given guidelines on overall demand, key sectors, the role of 
public and private capital, consumption demand  and technical innovation in energy-friendly 
sectors.  WT/TPR/M/300/Add.1 
 
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 In September 2013, the State Council has issued Air Pollution Prevention and Control Action Plan 
(Guo Fa [2013] No.37). Meanwhile, the government works hard to foster energy-friendly sectors and encourage energy-friendly sectors by foreign investment.  
China will give a detailed account when the specif ic supporting support falls into the purview of 
SCM.   
Pages 88-89 (Para 3.126)  
In addition to the programmes notified by China, there appear to be other support programmes and other means to support different industries (e.g. fisheries) including through the provision of grants, policy lending by state-owned banks and th e supply of goods at lower than "market price" 
by state-owned enterprises (SOEs) (Table A3.6).  However, in the context of this Review, no 
information was provided to the Secretariat regarding these specific programmes or China's industrial policies that supported different areas of the economy. Moreover, the identification of 
these programmes has not been possible for the Secretariat, as specific support measures seem to 
be the result of internal administrative measures that are not published in English. In addition, the Secretariat did not have access to an itemized central budget to be able to identify the outlays.  
 
Question(s) 
31. Could China please indicate the specific industries that are granted policy loans by state-owned banks?  
 
Answer 
As the independent market player, the lending policy  of financial institutions is completely subject 
to their own operation and strategic arrangement, risk management capacity and market 
condition.  According to Article 41 of the Law on Commercial Bank, "no entity or individual shall force 
commercial banks to grant loans or provide guarantee. Commercial banks have the right to refuse 
any entity and individual request for loan grant or guarantee provision. The credit practice of banks and financial institutions are supervised.  The Chinese Government shall not interfere with the detail procedure of commercial banks in 
setting loan interest rate, nor will it demand commercial banks to exercise different interest rate 
for enterprises of different ownership.   
Page 90 (Para 3.129)  
In 2012, the People's Bank of China (PBC) made efforts to enhance coordination between credit policy and industrial policies by promoting the ba lanced development of the economy, speeding up 
the innovation of rural financial products and services and improving financial services for SMEs. In 
this context, the PBC has guided financial institutions to increase financial support to important areas of the economy and to extend credit to key industries such as thermal power and steel, 
shipping and railways. Financial institutions were encouraged to use flexible credit products so as 
to enhance support for export-oriented enterprises. In line with the principle of "differential 
treatment for different industries", financial institutions were guided to increase "green" credit. In 2012, credit, financial support, preferential loans and the improvement of financial services played 
an important role in the implementation of the nati onal policy of regional economic development.  
 Question(s) 
32. Please provide details of the increased financial support and extended credit facilities offered to thermal power industries by the PBC.   Answer 
The PBOC conduct macro regulation by market  mechanism. It doesn't make any specific 
requirement on the detail credit of financial institutions. As independent market player, the lending policy of financial institutions is completely subject to their own operation and strategic 
arrangement, risk management capacity and market environment. 
According to Article 41 of the Law on Commercial Bank, "no entity or individual shall force commercial banks to grant loans or provide guarantee. Commercial banks have the right to refuse 
any entity and individual request for loan grant or guarantee provision. The credit practice of 
banks and financial institutions are supervised. WT/TPR/M/300/Add.1 
 
- 93 - 
 
  
 The Chinese Government shall not interfere with the detail procedure of commercial banks in 
setting loan interest rate, nor will it demand commercial banks to exercise different interest rate for enterprises of different ownership.  
 
Page 91 (Para 3.131)  SOEs seem to be supported by the Government in different ways including through the provision 
of direct transfers to finance wages and operating costs, and cheap inputs and credit. China 
provides SOEs with preferential access to credit at the expense of more profitable projects; by 
lowering the cost of capital, SOEs with low productivity can continue to exist.   
Question(s) 
33. Could we please have details of the support measures that apply to state-owned energy 
enterprises?  
 
Answer 
Currently, our tax breaks turn blind eye to the ownership of enterprises. Thus there is no 
differentiated tax breaks.  
 3.3.2.6 Price controls  
Page 100 (Para 3.168)  
Government prices are applied to items subject to  state monopoly, such as tobacco and salt, and 
to public-interest items, such as educational ma terial. Government-guided prices are applied to 
refined oil, fertilizers, and natural gas. Products classified as the State's key reserve materials 
(grain, cotton, sugar, silkworm cocoons, crude oi l, processed oil, and chemical fertilizers), are 
included in the Government Pricing Catalogue released in 2001 and, according to the Catalogue, 
could be subject to government prices (Table 3.14). The authorities have noted that this is not the 
case in practice, since China does not directly set the prices of reserve materials. Since reserve-materials procurement is generally conducted through auctions, prices are the result of competitive bidding.  
 
Question(s) 
34. How do price controls imposed by the Government help to enhance the competitiveness of 
energy enterprises?  
 Answer 
In 2013, China has improved the pricing mechanism of refined oil and makes it more sensitive to 
the international oil price, the cost of enterprises and the market demand and supply.  35. How does the Government deal with a fiscal deficit when it is caused by price controls?  
 
Answer 
The state-owned energy enterprises are responsible for their profits and losses and has not 
brought about fiscal deficit. 
 3.3.5.4.3 Undisclosed Information and trade secrets  
 
Page 118 (Para 3.242)   The People's Courts exercise the judicial power to try civil and criminal cases related to undisclosed 
information and the protection of trade secrets. The Public Security Agency is responsible for 
criminal investigations in cases that seriously infringe undisclosed information or trade secrets, while SAIC is in charge of the administrative enforcement of the law in this regard.  
 
Question(s) 
36. How does the SAIC uncover incidences of misconduct relating to the protection of trade secrets 
in practice? Does it launch investigations into such cases upon complaints received from rights 
holders, or by its own ex officio  actions?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
When delivering on Anti-Unfair Competition Law of  PRC, the Authority of Industry and Commerce 
can probe into cases through their responsibilities or through complaints. For cases involving 
business secrets, the authority mainly deals with them through complaints.  
 Page 118 (Para 3.243) 
Under the Regulations for the Implementation of the Law on Drug Control, China protects test data 
and other data that are self-obtained, undisclosed, and submitted by manufacturers or sellers to obtain an approval for manufacturing or selling a drug that contains new chemical entities. It is forbidden to use such undisclosed test data and other data for improper commercial purposes. The 
protection term for the manufacturer or seller is of six years from the approval for manufacturing 
or selling the drug. During this period, the auth orities are mandated to deny approval to other 
applicants using the same data.  
 
Question(s) 
37. Given that the test data protection term for drugs with new chemical entities is 6 years, what 
term applies to drugs not containing new chemical entities, but which can be used to cure another 
disease?   Answer 
In line with Regulations on Implementing the Drug Administration Law, China would give protection for all lab data and others that have been gained yet unexposed about the new chemicals in drugs, but this protection will not extend into other drugs. Apart from the data 
protection, China also provides patent protection for new discoveries from researchers who can 
also apply for patent protection.   
3.3.5.5.3.1 Customs law enforcement 
 Page 122 (Para 3.261)  The authorities have noted that, during the period under review, Customs has further 
strengthened its cooperation with the Public Security Authority, to more effectively connect 
Customs' administrative law enforcement with criminal law enforcement. Customs has also cooperated with other law enforcement authorities: for example, in June 2012, the General 
Administration of Customs and SAIC concluded a Memorandum of Cooperation Between the 
General Administration of Customs and the State Administration of Industry and Commerce.   
Question(s) 
38. What are the legal grounds for cooperation between Customs and the Public Security 
Authority? If there is no specific legal basis, can the Public Security Authority appoint a special team to operate within the Customs to help staff enforce border measures?  
 
Answer 
Legal wise, the General Administration of Customs and Public Security Bureau work together in 
line with Customs Law of PRC. Its 5th article stipulates that the country should carry out joint anti-
smuggling action and put in place this unified and comprehensive anti-smuggling system. Beyond 
that, With regard to the smuggling cases broken down by law-enforcement departments, they 
should be given administrative punishment and transported to the General Administration of 
Customs; As for those suspected criminal cases, they  should be dealt with by public security's anti-
smuggling investigation department of the General Administration of Customs , and local public security bureau.  
 
Since July 1998, we have set in motion an anti-smuggling force team to work under a system under the double leadership of the General Admini stration of Customs and public security bureau 
with the latter as the priority. In July 2000, th e revised version of Customs Law of PRC further 
defines the nature, responsibility and law-enforcement procedures of public security's anti-smuggling investigation department of the General Administration of Customs. In June 2005, the 
anti-smuggling department should assume the full responsibility of investigating smuggling and 
illegal cases. The anti-smuggling police system has moved away from the preliminary function of 
law enforcement to the dual responsibilities of cr iminality and administration. Above all, the anti-
smuggling policemen will deliver on their responsi bility in line with General Customs' deployment WT/TPR/M/300/Add.1 
 
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 under the system of combined corporation of both  General Administration of Customs and public 
security bureau with the latter as priority instea d of a law-enforcement team assigned by public 
security bureau.  
 
39. Please elaborate further on the cooperation between the General Administration of Customs 
and the State Administration of Industry and Co mmerce. For example, why did the two authorities 
decide to sign the Memorandum, what is the ex act nature and the length of term of their 
cooperation, and is there a clause or condition to decide whether it shall continue or stop?   Answer 
The General Administration of Customs and the State Administration of Industry and Commerce are departments affiliated to the State Council. The General Administration of Customs is a regulatory organ for import and export while the State Administration of Industry and Commerce 
is the main body for market supervision and mana gement and relevant law enforcement. In spite 
of different purview, they jointly assume the re sponsibility of optimizing the market environment 
and serving a fast growing economy. Besides, they  have much room for corporation on the ground 
in the effort to fight against smuggling , protect legitimate rights and interests of customers, and 
strengthen the IPR protection. In this connection, both sides signed MOU in 2012 which sustain its role to the future.   
PART II: THE GOVERNMENT REPORT (WT/TPR/G/300)  
 2. Economic and Trade Environment and Macroeconomic Policy Direction 
2.3.4 Advancing energy conservation, pollution  reduction and industrial  restructuring 
 Page 9 (Para 2.30)  
Since the last review, the Chinese Government continues to carry out the work to close down 
excess and outdated production capacity in the in dustries of high consumption and high emission 
such as steel, cement and electrolytic aluminium. It has further strengthened the comprehensive treatment and control of air pollution caused by industrial enterprises, and accelerated the 
implementation of the transformation projects us ing clean production technologies. China raised 
market access criteria for certain industries, and strengthened compliance enforcement with regard to industrial standards for admittance into technology, energy consumption, environment 
protection and safety. The Government also carried out clean production reviews in key industries 
such as steel, cement, chemistry, and nonferrous metal metallurgy.  
Question(s) 
40. Could the Government please specify those industries for which market access criteria have 
been raised?   
Answer 
The Ministry of Industry and Information Technolo gy issued the construction and sanitary ceramics 
industry access standards in 2013, putting forward requirements for energy consumption and 
environmental protection. Please refer to the webs ite of the Ministry of Industry and Information 
Technology for other industry access standards.  
2.4.6 Other reform measures 
 Page 14 (Para 2.54)  In continuing the reform of the medical and heal thcare system a comprehensive reform of public 
hospitals is being advanced. The Chinese Government has also sped up the opening-up of the 
medical services market and promoted participation of social resources in medical facilities.   
Question(s) 
41. Could China please provide more detailed information on the main objectives, schedules and 
strategies of its medical and healthcare system reforms, and specifically on how reforms are being 
carried out to public hospitals?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
(i) The goal and plan for healthcare system reform 
The deepening reform of medical system is designed  to refine a healthcare system covering both 
rural and urban dwellers so as to bring safe, effe ctive, accessible and affordable healthcare service 
closer to people.  (ii) Active reform for public hospitals  
The reform mainly consists of 7 tasks as follows. First, we work to straighten out the medicine 
prices and treatment ones. Secondly, we work to refine modern medical management system.  
Thirdly, we should optimize incentive mechanis m. Fourthly, we work to press ahead with the 
reform of drug purchase mechanism. Fifthly, we will focus on the layout and adjustment of medical  
resources. Sixthly, we will put in place a multi-ti ered treatment structure. Seventhly, we work to 
reform supervisory mechanism to ensure the quality of medical care.  (iii) To put in place a unified and coordinated medical care management system. 
 
3. Trade and Investment Deve lopment and Related Policies 
3.3.2 Improving competitiveness through "going global"  
 
Page 21 (Para 3.37) The report states that for the purpose of facilitating enterprises in outbound foreign investment, the National Development and Reform Commission promulgated the Administrative Measures on 
Approval and Filing of Overseas Investment Projects in April 2014 in accordance with the 
Catalogue of Investment Projects Subject to Governmental Verification (2013) promulgated by the State Council in December 2013.  
 
Although the government of China goes on to state in its report that projects are subject to filing 
rather than verification, with the exception of those under the circumstances listed specifically, it 
seems to us that the criteria, standards of review and measures to be applied are still not 
concrete. Hence, the corresponding amendments to the Administrative Measures on Overseas Investment Projects as mentioned are still ongoing.   
Question(s) 
42. What are the regulations under the "Approval an d Filing of Overseas Investment Projects" that 
pertain to case review criteria, follow-up measures and other subsidies or incentive measures?  
 
43. What progress is likely to be made on the amendments to the "Administrative Measures on Overseas Investment Projects" by the Ministry o f  C o m m e r c e ,  a n d  w h a t  i s  e x p e c t e d  t o  b e  t h e  
content?  
 Answer 
Please refer to Administrative Measures on  Overseas Investment Projects of China. 
 
Page 21 (Para 3.39)  In 2013, the Chinese government proposed the vision of establishing a "Silk Road Economic Belt" 
and a "Maritime Silk Road" as well as the initiative of developing the Bangladesh-China-India-
Burma Economic Corridor and the China-Pakistan Economic Corridor. This helps China implement a new round of opening up and building a new system  of an open economy, advance the growth of 
inland and border areas and the coordinated develo pment of relevant regions, create a favourable 
surrounding environment and usher in a new phase of mutually beneficial and win-win opening up.   Question(s) 
44. Could China please elaborate further on these four economic cooperation zones in terms of their development goals, implementation plan s, anticipated timeframes and participating 
countries, and on the possibility of further integration with other WTO Members?  
 WT/TPR/M/300/Add.1 
 
- 97 - 
 
  
 Answer 
The main content of "One Belt and One Road" construction is to achieve policy communication, 
road connectivity, unimpeded trade, monetary ci rculation and understanding between the people. 
It is an open and inclusive economic cooperation initiative. China welcomes the participation of 
interested countries and economies in consultations and construction, to achieve a win-win situation. China is willing to see that WTO member states become supporters, builders and 
beneficiaries in "One Belt and One Road" construction.  WT/TPR/M/300/Add.1 
 
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 12  PREGUNTAS DE GUATEMALA 
Temas: Agrícolas, ayudas internas, subsidios 
Tema-Sub China MAGA 
2.3.1 Adhering to 
expanding 
domestic demand 2.16. The Chinese government takes 
promoting consumption, particularly the 
household consumption, as the focal point 
in expanding domestic demand. From March 2009 to January 2013, it 
implemented direct consumption stimulus 
programmes nationwide such as programmes for rural residents to purchase home appliances and motor 
vehicles and motorbikes, for people to 
trade in old motor vehicles and home appliances for new ones (Among them, 
the programmes for rural residents to 
purchase motor vehicles and motorbikes were implemented from March 2009 to 
December 2010, and the programme for 
people to trade in old motor vehicles for new ones was implemented from 2009 to December 2010, and the programme for 
people to trade in old home appliances for 
new ones was implemented from 2009 to December 2011). The Chinese 
Government continues to make efforts to 
increase the income of urban and rural residents and improve their capacities for 
consumption, by the means of increasing 
spending on agriculture, rural areas and farmers, implementing structural taxation reduction and expanding employment.  Prevén implementar algún 
programa para aumentar el 
gasto en la agricultura y en la 
producción de productos pecuarios? 
Answer 
China operates support 
measures to livestock according to WTO Agriculture Agreement. 
 
Actualmente qué porcentaje de la reducción de los impuestos, 
se está destinando al gasto de 
los productos agrícolas y en la producción de productos 
pecuarios?  
Answer 
We do not have the data at the current stage. 
 
  
 2.20. At present, priorities of public 
investment arranged in the central budget 
of China include low-income housing, 
infrastructure in the areas of agriculture, 
water conservancy, and railway, people's 
livelihood projects such as those in social 
services, and also energy conservation, 
emission reduction, and ecological 
environment. In 2012, China's total social 
fixed assets investment amounted to RMB 
37.47 trillion yuan with an increase of 
20.3%. Private investment, excluding 
rural households, increased by 24.8% and 
its proportion to total investment grew to 
61.4% with an increase of 2 percentage 
points in comparison with last year. In 
2013, total fixed assets investment 
reached RMB 44.71 trillion yuan with a 
year-on-year increase of 19.3%. Private 
investment (excluding rural households) 
increased by 23.1% and its proportion to 
total investment grew to 63%. En qué tipo de infraestructura 
están invirtiendo en el área de 
agricultura? 
Answer 
Infrastructure investment is 
focused on the projects that 
improve productivity, promote 
the application of advanced 
technologies, encourage 
innovation, and raise the living 
standard of farmers. For 
detailed information, please see 
to National Modernization Plan 
of Agriculture 2011-2015. 
 
Qué sistema se está utilizando 
para la conservación del agua?  
Answer 
We are building irrigation 
facilities in areas with abundant 
resources,  refurnishing the 
pumping stations, and working 
on flood-control. For small 
construction projects, we are 
perfecting the end-user 
irrigation system, to enhance 
the land's capability against WT/TPR/M/300/Add.1 
 
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 Tema-Sub China MAGA 
drought and flood. Small 
reservoirs, ponds, dams, 
pumping stations are being 
built in mountain areas. 
New technologies are applied 
for water reservation, such as 
plastic film mulch. Dry farming 
is encouraged. Infrastructure 
for saving water and improving 
the quality of farm land are 
built. Pilot projects are carried 
out to promote water-
reservation technologies. 
2.3.5 
Consolidating and 
strengthening the foundation for the 
development of 
agriculture and rural areas 2.32. Agriculture is a key industry in 
terms of expanding domestic demand and 
adjusting economic structure. It is of great significance for the long-term stability and 
sustainable development of China's 
economy and society. The Chinese government unswervingly considers the issues of agricultural and rural 
development as well as the farmers' 
wellbeing as the top priority, in bid to safeguard food security, to increase 
farmers' income, to promote agricultural 
modernization and to move forward rural development.  De qué forma fortalecerá China 
las bases para el mejoramiento 
del desarrollo agrícola en las zonas rurales? 
Answer 
Measures include: 
infrastructure building, such as irrigation systems; promoting 
technology innovation and 
application; developing scaled production and marketing. 
 
Qué tipo de ayuda es la que se está promoviendo para la 
modernización de la 
agricultura?  Answer 
Firstly, General and local plans 
for agricultural development 
are outlined, providing vital guidance to the agricultural 
modernization. 
Secondly, support system is designed to benefit the 
farmers. Direct payment and 
the four subsidies are granted according to WTO rule. Funds are for the construction of 
agriculture infrastructure, 
technology development, and financial services.  
Thirdly, establish pilot zones for 
promoting agricultural modernization.  
Fourthly, enhance rural reform 
by issuing Land Contract Law,  Real Right Law. Reforms on woods ownership are carried 
out. Woods and grassland can 
now be managed by family units. 
Qué tipo de programas, 
acuerdos, convenios, etc., poseen para salvaguardar la 
seguridad alimentaria? 
 WT/TPR/M/300/Add.1 
 
- 100 - 
 
  
 Tema-Sub China MAGA 
Answer 
Measures to safeguard food 
security are: necessary agriculture domestic support; 
anti-natural disaster projects; 
disease and pest control measures; pilot programs to 
increase productivity, provide 
tailored services, and to promote scaled marketing; soil sampling for custom-made 
fertilizers. 
3.4.1 Committed 
to advancing the 
Doha Development 
Agenda 3.45. China has actively participated in 
the "early harvest" negotiation on various 
areas with a constructive role of "facilitate 
the discussions, bridging the gaps and 
advancing the deal", and has been always 
showing flexibilities in the course of 
reaching agreements. In the negotiations 
on trade facilitation, China takes the lead 
in expressing that it will refrain from 
requesting for aid, leave resources to 
other developing members and provide 
supports to fellow developing members 
through "South-South Cooperation" within 
its capacity. On agriculture, China 
proposes the "peace clause" as the middle 
ground of the interim solution of food 
security, which was ultimately accepted by 
all Members, paving the way for achieving 
the "early harvest". On development 
issues, China has adopted substantial 
measures to address the concerns of 
LDCs, in particular on the issues of "DFQF" 
and cotton. During the MC9, China 
announced to provide further assistance to 
"Cotton Four" countries from Africa. China 
has played an active and constructive role 
in ensuring the success of MC9 held in 
Bali, Indonesia, at the end of 2013. 。 Qué tipo de ayuda estará 
brindando China a países en 
desarrollo para fortalecer el 
tema de facilitación del 
comercio?  
Answer 
China has actively responded to 
the Aid for Trade initiative of 
the WTO. China continues to 
provide assistances bilaterally 
to the best of its ability to other 
developing members, and has 
begun to make contributions to 
the Aid for Trade initiative 
under the multilateral 
framework of WTO since 2008. 
In 2011, China established  
"China's LDCs and Accessions 
Program" (China Program) to 
help the LDCs effectively 
participates in and benefit from 
the multilateral trading system 
and to help accelerate the 
accession process of those 
LDCs applying for WTO 
membership. In 2012 and 
2013, China contributed US$ 
800,000 to "China Program" 
and held a LDCs round-table on 
WTO accession in Beijing, 
laying a basis for the Guidelines 
for Accessions of Least-
Developed Countries reached 
by the Members later. During 
the MC9, China's Minister of 
Commerce Gao Hucheng and 
WTO Director-General Azevêdo 
concluded the third 
Memorandum on "China's LDCs 
and Accessions Program" and 
China contributed another 
US$400,000 to the programme.   
 WT/TPR/M/300/Add.1 
 
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 13  QUESTIONS BY JAPAN 
Report by CHINA (WT/TPR/G/300) 
 
3 Trade and Investment Deve lopment and Related Policies 
3.4 Building Economic and Trade Partnerships Based on Mutually Beneficial and Win-Win 
Principle 
3.4.2 Safeguarding the multilateral tr ading system with concrete actions 
 (Question 1: Page 24, Paragraph 3.54) Japan understands that although a draft implemen ting ordinance for the Government Procurement 
Law was made public in January 2010 and the Chinese Government requested public comments, 
the Chinese Government has yet to make public th e final draft of the implementing ordinance in 
Answer to these public comments. Please explai n the current status of the draft implementing 
ordinance in its legislative process. Specifically, in the same year, the Japanese Government 
expressed concerns about the draft implementing ordinance that the standards and guidelines are 
unclear and lack transparency, and foreign products and foreign companies could be discriminated 
against and requested that China, inter alia, establish a non-discrimination clause in the draft. 
Japan would like to know China's views on these comments.  Answer 
The Chinese Government is developing the Regulations on Implementation of Government Procurement Law following the legislative procedures, and will fully consider and adopt the reasonable views of the parties. 
 
(Question 2: Page 24, Paragraph 3.54) Japan understands that although a draft of administrative measures on domestic products 
procured by the Government was published in May 2010 and the Chinese Government requested 
public comments, it has yet to make public the final draft of the administrative measures. Please explain the current status of this draft of administrative measures in the legislative process. Specifically, in the same year, the Japanese Government expressed concern about these draft 
administrative measures that the standards and guidelines are unclear and lack transparency, and 
foreign products and foreign companies could be discriminated against, and requested that China, inter alia, modify the provisions giving more favorable treatment to domestic products and 
suppliers. Japan would like to know China's views on these comments. 
 Answer 
The Ministry of Finance of China has been revisi ng and improving the administrative measures for 
government procurement of domestic products in conjunction with relevant ministries based on the opinions of relevant parties.  
(Question 3: Page 24, Paragraph 3.54) 
It was reported in November 2013 that the National Development and Reform Commission issued a notice to exclude foreign companies from procurement in the ultra-high-pressure electric power 
generation and transmission equipment construction project. Is this report correct? If so, please 
provide more detail about this notice.   
Answer 
We are coordinating with relevant authorities. 
 (Question 4: Page 24, Paragraph 3.54) 
The Catalogue Guiding Indigenous Innovation in Major Technology Equipment was revised by the 
Ministry of Industry and Information Technology, the Ministry of Science and Technology, the Ministry of Finance, and the State-owned Assets Supervision and Administration Commission in 
January 2012. The public notice of the revised cata logue stipulates that local governments have to 
facilitate indigenous innovation in major technology equipment listed in this catalogue. Please provide concrete examples of measures taken to facilitate such indigenous innovations under this 
scheme. Specifically, Japan would like to know whether governmental entities are required to take 
any measures to facilitate such innovation also in its procurement.  
 WT/TPR/M/300/Add.1 
 
- 102 - 
 
  
 Answer 
The authorities concerned have printed and distributed the circulars to announce the cease of the 
implementation of such measures as the Administrative Measures for the Determination of 
National Domestically Innovated Products (for trial), the Administrative Measures on Domestically 
Innovated Products in Government Procurement Budget, the Appraisal Methods on Independent Innovation Products in Government Procurement and the Administrative Measures on Domestically 
Innovated Products in Government Procurement Contracts. China's domestically innovated 
products are no longer linked with the provision of preferential government procurement policies. 
On 17 November 2011, the State Council issued a document with an explicit requirement that 
regulatory documents of relevant departments of local people's governments at all levels on the 
measures that innovation policies are linked to the provision of preferential government 
procurement shall be suspended with effect from 1 December 2011.   
(Question 5: Page 24, Paragraph 3.54) 
Japan understands that the Notice of the stre ngthening of the management of government 
procurement of central budget units was published in May 2012 by the Ministry of Finance and this 
notice requires governmental entities to procure domestic products favorably. Is this 
understanding correct? Does China plan to correct the discriminatory treatment of foreign suppliers with a view to acceding to the WTO Agreement on Government Procurement?  
 
Answer 
The Notice reiterates the relevant contents in the "Government Procurement Law" rather than sets 
new requirements. After joining the Government Procurement Agreement, China will adjust the 
relevant laws and regulations in accordance with the results of negotiations and GPA rules. 
 Report by the Secretariat (WT/TPR/S/300) 
 
2 TRADE AND INVESTMENT REGIME 2.1 Institutional and legal framework  
(Question 6: Page 36, Paragraph 2.11) 
To promote public consultation, could China provide more detailed implementation rules on the "regulations and rules" carried out in this regard, and familiarize people involved with the 
regulations and rules? Furthermore, could China give opportunity to foreign industry associations 
in order to share each other's thoughts on public comments on the "regulations and rules"?  
 
Answer 
The legislation law implemented by the Chinese Government since 2000 makes legislative 
information disclosure a basic principle that the Government must follow in legislative activities and prescribes the channels opened by the Government for citizens to participate in legislative 
activities, including soliciting written comments, holding seminars, hearings, discussion meetings, 
making draft laws and regulations public, and so on. The Ordinance concerning the Procedures for the Formulation of Administrative Regulations and the Ordinance concerning the Procedures for the 
Formulation of Rules developed by the State Council according to the legislation law and relevant 
laws in 2001 include specific provisions for the improvement of the transparency of the 
government's legislative work. In the process of drafting laws, regulations and rules, the State 
Council and its departments, as well as local governments with legislative power, collect opinions 
from all sides, including foreign companies, asso ciations and individuals, by soliciting written 
comments, holding seminars, hearings, discussion meetings, and international symposiums. The Chinese government has also begun to solicit the vi ews of the public on draft laws, administrative 
regulations and departmental rules, with a few exceptions, on the Internet since 2008. 
 WT/TPR/M/300/Add.1 
 
- 103 - 
 
  
 2.2 Trade policy framework and objectives 
2.2.2 Trade policy objectives  
(Question 7: Pages 38-39, Paragraphs 2.20-2.27) 
It is Japan's understanding that China has no expe rience with the Negative List Approach in FTA 
negotiations in Services / Investment fields. On the other hand, according to the report by the 
Secretariat, the Ministry of Commerce (MOFCOM) is trying to reform the investment regime 
outward to make it more open, transparent and predictable for foreign investors and, at the same time, actively negotiating a number of bilateral / regional trade agreements. For example, the China (Shanghai) Pilot Free-Trade Zone (CSPFTZ) was established in 2013, and CSPFTZ issues a 
"Negative List" for foreign investment. Japan would like to know if China has the intention to 
accept a Negative List approach in its FTA negotiations in Services / Investment fields. If not, Japan would like to know the reason for the difficulty and how long or what is needed for China to 
adopt the Negative List approach, which would pr ovide more clarity and transparency to foreign 
investors.  
Answer 
The market access issue has never been involved in investment or services negotiations under the 
free trade agreements between China and other members. China has never specified the restrictive measures for foreign investment in the Negative List approach. China is exploring the 
administrative model for applying pre-establishment national treatment plus negative list to 
foreign investment and service sectors, and is w illing to carry out discussions and exchanges with 
the countries concerned on issues associated with investment market access and negative list 
negotiation under the free trade agreement.  
 2.3 Participation in the World Trade Organization 
 
(Question 8: Page 39, Paragraph 2.29) China's tariff schedule, as well as other ITA Me mbers' ones, includes its duty free commitment on 
certain information technology products under the Information Technology Agreement (ITA), 
including those specified in Attachment B thereto. In this regard, the Reports of the WTO Panel on 
WT/DS375, WT/DS376 and WT/DS377 (paragraph 7.321 to 7.446) confirmed that this means that, by such inclusion, ITA Members are obligated to ensure duty free treatment for such ITA products, 
and concluded that the scope of duty-free products  referred to Attachment B is determined by the 
product descriptions in Attachment B (and also incorporated in the tariff schedule) rather than HS codes listed next to each of the Attachment B production descriptions. Japan thinks that China is 
accordingly obligated to provide duty-free treatment to the following two products: 
 
1) Current ITA Attachment B covers flat panel displays (FPDs) "for" products falling within the ITA. 
The reports of the WTO Panel on WT/DS375, WT/DS376 and WT/DS377 (paragraph 7.506, 7.535 
and 7.604) concluded that the current ITA duty free concessions cover "FPDs capable of being 
used in an automatic data processing system" (Attachment B). Therefore, the current ITA duty 
free concessions include a part of HS8528.59 (HS2007) as well as HS8528.51 (HS2007) as a 
whole. On the other hand, China currently has ta riffs for the whole of HS8528.59. Japan would like 
to know China's position on the consistency of current treatment of HS8528.59 with ITA 
obligations.  
 
Answer 
According to the HS 6-digil codes in WCO HS2007, the product under HS8528.51 is non-cathode-
ray tube monitor solely or principally used in automatic data processing system under heading 
84.71, corresponding to flat panel display capable of being used in automatic data processing system mentioned in ITA Attachment B. China's Custom Import and Export Tariff follows the WCO Harmonized System, and thus the monitor under HS8528.51 enjoys zero tariff. However, the 
product under HS8528.59 is display not used in automatic data processing system and does not 
belong to ITA products, so China levies import duty on the product.  
2) Current ITA Attachment B covers "Projection ty pe flat display units used with automatic data 
processing machines which can display digital information generated by the central processing unit." This means that "projectors capable of bein g used with automatic data processing machines" 
are included in current ITA Attachment B. The 22nd WCO/HSC made the decision that these WT/TPR/M/300/Add.1 
 
- 104 - 
 
  
 "projectors capable of being used with automatic data processing machines" fall within HS8528.30 
of HS2002 (HS8528.30 of HS2002 is transformed to HS8528.69 of HS2007). Therefore, we recognize that the current ITA Attachment B include projectors in HS8528.69 of HS2007 and , in 
fact, major ITA Members made a duty free concession of a part of HS8528.69 of HS2007. On the 
other hand, China currently has tariffs for the whole of HS8528.69. Japan would like to know China's position on the consistency of current treatment of HS8528.69 with ITA obligations.  
 
Answer 
According to the HS 6-digil codes in WCO HS2007, the product under HS8528.61 is projector 
solely or principally used in automatic data pr ocessing system under heading 84.71, corresponding 
to projector capable of being used in automatic data processing system mentioned in ITA Attachment B. China's Customs Import and Expo rt Tariff follows the WCO Harmonized System, 
and thus the projector under HS8528.61 enjoys zero tariff. 
 
We have no objection to Japan's argument that HS8528.30 of HS2002 is transformed to HS8528.69 of HS2007. According to the WCO note on HS2007-HS2002 conversion, all products 
under HS8528.61 in HS2007 are from HS8471.60 in HS2002. We believe projector capable of being used in automatic data processing system mentioned in ITA belongs to computer output 
devices under HS8471.60 in HS2002 and thus shall not be listed under HS8528.69 in HS2007. So 
China levies import duty on the product.  
2.5 Foreign investment regime 
2.5.1 Regulatory framework and market access  
 (Question 9: Pages 42-43, Paragraph 2.46) 
The Report mentions that Market access has improv ed in the import of audio-visual products and 
books in China.   
1) Japan would like China to provide information on the existing regulations related to Audio Visual 
Services and Publishing Services, including regulations for broadcasting, screening and online delivery of cartoons and movies.  
 
Answer 
The relevant regulations include but are not limited to the Regulations on Administration of Publication, the Regulations on Administration of Audio and Video Products, the Regulations on 
Administration of Films, the Regulations on Broadcasting and Television Administration, the 
Administrative Provisions on Manufacture of Audio and Video Products, the Administrative Provisions on Publication of Audio and Video Products, the Administrative Provisions on Import of 
Audio and Video Products, the Interim Provisions on Administration of Internet-Based Publication, 
the Interim Provisions on Administration of Internet-Based Audio and Video Program Services and so on. These regulations and provisions can be found at the official website of State Administration 
of Press, Publication, Radio, Film and Television. 
 2) Japan would like to know whether and what changes have been made in China regarding import and distribution of publications and audio-visual  products, since the WTO Appellate Body report 
WT/DS363AB/R was adopted.  
 
Answer 
China has revised the Regulations on Administration of Publication, the Regulations on 
Administration of Audio and Video Products, the Administrative Provisions on Import of Audio and Video Products, and the Administrative Provisions on Publications Market, modified the licensing 
conditions for the importers and operators of publications and audio & video products, the 
licensing conditions for the issuers of publications and audio & video products, the licensing procedures and the business scope. 
 WT/TPR/M/300/Add.1 
 
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 2.5.4 China (Shanghai) Pilot Free Trade Zone (CSPFTZ) 
 (Question 10: Page 51, Paragraph 2.81) 
While special measures for foreign investment access have been applied in CSPFTZ, Japan would 
like to know: 1) Whether there are plans for expanding such measures to other areas in China.  
2) Whether there are plans for further improvement in business related to audio-visual products 
and services within CSPFTZ.   Answer 
In September 2013, the State Council issued the Framework Plan for China (Shanghai) Pilot Free Trade Zone. The establishment of China (Shanghai)  Pilot Free Trade Zone is a significant measure 
to advance China's reform and opening up under the new circumstances, with a view to promoting 
reform and development by opening up the econ omy. Through pilot tasks, China would like to 
accelerate the functional transformation of  the Chinese Government, actively explore 
administrative innovation, facilitate trade and investment, as well as create a regulatory system 
for cross border investment and trading in line with  international practices and the rule of law, and 
explore new approaches and accumulate new experience for deepening all-round reform and expanding opening up.  
3 Trade Policies and Practices by Measure 
3.1 Measures Directly Affecting Imports 3.1.2 Customs valuation 
 
(Question 11: Page 58, Paragraph 3.9) Some Chinese customs authorities such as in Shanghai and Shenzhen impose customs duties by 
way of their own reference prices, without considering actual transaction value submitted by the 
importers. Sometimes such authorities instruct th e importers to modify to increase the declared 
value without providing clear reasoning or sufficient grounds. The WTO Agreement stipulates that the customs value shall be the transaction value, th at is the price actually paid or payable for the 
goods, and should not be based on arbitrary or fictitious values (Article VII of the GATT and the 
Agreement of Implementation of the said Article) . We would like to hear from the Government of 
China about its position on WTO consistency of such customs practices and measures that are/will 
be taken to prevent such practices in the future. 
 Answer 
The legal basis for the valuation of China Customs is the Customs Law, the Regulations on Import 
and Export Duties and the Measures for the Asse ssment and Determination of Duty-paid Value of 
Import and Export Goods, in which all the provisions associated with valuation are in line with the WTO Customs Valuation Agreement. China Customs observes the principles of objectiveness, 
fairness and unification, checks and determines the duty-paid value of imported goods on the basis 
of transaction price with full respect for the actual trading conditions, and declares not to use the lowest fixed price, or other arbitrary or fictive prices. Where China Customs has doubts in the 
authenticity or accuracy of the declared value, the challenge of price and consultation procedure 
will be started according to laws and regulations.  China Customs will continue to improve the laws 
and regulations associated with value assessment, strengthen analysis and control of price risk, 
take greater efforts to improve value assessment training, strengthen the support of price 
consultation to on-site services, effectively improve the law enforcement of customs officers, and ensure the unity of law enforcement.  
3.1.4 Tariffs 
3.1.4.2 Bound tariff  
(Question 12: Page 60, Paragraph 3.19) 
The Secretariat's report indicated that Chinese au thorities ensure that non-ad valorem duty rates 
of 43 tariff lines are always equal to the bound duty rates, which are all ad valorem rates in 
accordance with China's accession commitments. There is a possibility that applied non-ad valorem 
duty rates exceed bound rates, depending on the price of import products. In fact, laser 
phototypesetting film, without perforations, width>610mm, length<=200m (HS37024321), whose applied non-ad valorem duty rate has been raised since 1 January 2014, exceeds the bound duty WT/TPR/M/300/Add.1 
 
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 rate when converted into the ad valorem rate. We would like to hear from the Government of 
China about its position on WTO consistency of such bound duty rates.  
 
Answer 
We are verifying product-related data. 
 
Moreover, the report by the Appellate Body in DS56 Argentina — Measures Affecting Imports of Footwear, Textiles, Apparel and other Items, WT/DS56/AB/R — concluded that the application of a type of duty different from the type provided for in a Member's Schedule is inconsistent with the 
WTO bound duty obligation to the extent that it results in ordinary customs duties being levied in 
e x c e s s  o f  t h o s e  p r o v i d e d  f o r  i n  t h a t  M e m b e r ' s  S c h e d u l e .  W e  w o u l d  l i k e  t o  h e a r  f r o m  t h e  Government of China about its measures that are/will be taken to prevent inconsistency with WTO 
bound duty obligation.  
 Answer 
China has strictly fulfilled its tariff reduction obligation under WTO commitments.  3.1.7 Anti-dumping, countervailin g, and safeguard measures 
3.1.7.1 Anti-dumping measures 
 
(Question 13: Page 66, Paragraph 3.33) In recent years, the investigation procedures an d  d e te rminations  of M OF COM  we re  found  to b e 
inconsistent with the AD Agreement by the Panels and the Appellate Body with regard to, inter 
alia, (i) inadequate disclosure of essential facts, (ii) inadequate explanation of findings and conclusions in the public notice of the final determination, (iii) a failure to conduct an objective 
examination of the volume and price effect of the dumped imports, the impact of the dumped 
imports on the domestic industry and the causation between the dumped imports and injury to the domestic industry (Please see the reports of DS414, DS425, DS427 and DS440). Taking into account these results, did MOFCOM amend its invest igation regulations or practices? If not, is 
there any plan to amend them?  
 
Answer 
China takes efforts to be in strict compliance with WTO rules in the anti-dumping investigation 
process. China respects and earnestly abides by the rulings of Dispute Settlement Body, although 
with reservations about part of such rulings , and makes corresponding adjustments to the 
investigations and rulings according to the reco mmendations of the Panel and Appellate Body in 
the course of the implementation of such rulings.  
(Question 14: Page 66, Paragraph 3.34) 
According to the Report, "Two different bureau s within MOFCOM participate in anti-dumping 
investigations." However, those two bureaus were  merged into one bureau, the "Trade Remedy 
and Investigation Bureau" ("TRIB") on 17 April 2014. Japan would like to know whether there were 
any changes in the AD investigation practice by this merger of the two bureaus. Specifically, Japan understands that, in the prior practice, BOFT conducted the investigations concerning dumping and IBII conducted the investigations concerning injury. Could China explain about the current 
practice? Is it correct to understand that in the current practice one investigation team in TRIB 
conducts the investigations with respect to both dumping and injury? In this connection, while in the prior practice BOFT issued a questionnaire concerning dumping and IBII also issued a 
questionnaire concerning injury to exporters or producers, does TRIB now issue one questionnaire 
concerning both dumping and injury to exporters or producers?  
Answer 
TRIB is established on the basis of the consolidat ion of BOFT and IBII, and its functions cover the 
functions of BOFT and IBII in the area of trade re medy investigation. This adjustment will further 
improve the efficiency of trade remedy investigatio n, reduce stakeholders' burden in litigation, and 
make the investigation procedures more optimized and proper. For example, all investigations 
concerning dumping, injury and causation are co nducted by a single division. The essence of 
China's trade remedy investigation system will no t be substantially affected by the adjustment. 
 WT/TPR/M/300/Add.1 
 
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 (Question 15: Page 67, Paragraph 3.39) 
According to the Report, "the authorities are exam ining whether a duty lower than the margin of 
dumping would be sufficient to remove the injury to the domestic industry." Japan would like to 
know whether there are any provisions stipulating how to make such an examination in China's 
domestic regulations and whether there are any cases in which an AD duty lower than the margin of dumping was imposed.  
 
Answer 
L i k e  t h e  v a s t  m a j o r i t y  o f  W T O  M e m b e r s ,  C h i n a  does not have less-duty principle in its anti-
dumping law, and thus does not investigate the magnitude of the damage or apply less-duty 
principle in practice. But this does not hinder Chinese investigation authority from conducting anti-
dumping investigations and taking appropriate actions objectively, impartially and in accordance with laws. There has been no case in which an AD duty lower than the margin of dumping was 
imposed in China. 
 3.1.8 Standards and other technical requirements 
3.1.8.1 Standards and technical regulations 
 (Question 16: Page 73, Paragraph 3.66) According to paragraph 3.66, there are four kinds of standards in China. Japan would appreciate it 
if China would elaborate on the differences and similarities of these standards, especially from the 
viewpoint of the mandatory or voluntary nature of the standards.  
Answer 
Article 6 of the Standardization Law provides: "N ational standards shall be formulated for the 
technical requirements that need to be unified nationwide. Where, in the absence of national 
standards, technical requirements for a certain tr ade need to be unified, trade standards may be 
formulated. Where, in the absence of both national and trade standards, safety and sanitary requirements for industrial products need to be uni fied within a province, an autonomous region or 
a municipality directly under the Central Govern ment, local standards may be formulated. Where, 
in the absence of both national and trade standards for products manufactured by an enterprise, 
standards for the enterprise shall be formulated to  serve as the criteria for the organization of 
production." Article 6 of the Standardization Law provides: "National standards and trade 
standards shall be classified into compulsory standards and voluntary standards. Those for 
safeguarding human health and ensuring the sa fety of people and property and those for 
compulsory execution as prescribed by laws, administrative rules and regulations shall be 
compulsory standards, the others shall be voluntary standards." 
 (Question 17: Page 73, Paragraph 3.67) According to Paragraph 3.67, various authorities se em to be responsible for implementation of the 
standard and technical regulations. Are there any fragmentations and/or overlap as written in 
Paragraph 3.78 (SPS regime)? If so, what does China consider that the principal challenges are?   
Answer 
WTO does not set a requirement on the number of the departments responsible for SPS measures. 
In many member states, including the United States, several departments are jointly responsible 
for SPS measures, and each department's measures  are associated with international trade. In 
China, AQSIQ is responsible for administration an d supervision of the import and export of food, 
plants, animals and their products; Food and Drug Administration and Ministry of Agriculture are responsible for administration and supervision of domestic production and distribution of food, 
plants, animals and their products; Health and Family Planning Commission is responsible for the 
development and revision of national food safety standards. Different departments perform their regulatory responsibilities in different sections. Each department is charged with specific 
responsibilities and works in collaboration with others. There are no fragmentations and/or overlap 
as written in Paragraph 3.78 (SPS regime).  WT/TPR/M/300/Add.1 
 
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 (Question 18: Pages 73-74) 
Under Section 3.1, there is a sub-section 3.1.9, describing the issues of SPS. Since we have experienced several issues related to TBT, we be lieve that sub-section describing the TBT issues 
should be added as well as the sub-section of SPS. Specifically, we would like to raise the following 
points:  1) Implementation of a Marketing Authorization Holder (MAH) system. 
Currently, a MAH system has not been implemented in China, assuming that all 
pharmaceuticals/medical devices are manufactured in China. Therefore, a company intending to import medical products to China is required to obtain a distribution license for each product. Implementation of a MAH system, which allows a company to sell its product without 
manufacturing by itself, is strongly required in line with international standards.  
2) Streamlining the review process for clinical trial approval. According to the"2012 China Drug Review Report" published by the Center for Drug Evaluation 
(CDE), the waiting time to have clinical trial assessment for NDA is 15 months as of August 2012. 
To facilitate the introduction of innovative new medical products, streamlining the review process is required. 
 
Answer 
The State Food and Drug Administration issued the Opinion on Deepening the Reform of Review and Approval for Drugs to Further Encourage Drug Innovation (Guo Shi Yao Jian Zhu No. 37 
[2013]) on 22 February 2013, in which a number of measures were adopted to accelerate the 
review of innovative drugs, including: (a) To speed up the review on applications for i nnovative new drugs with better therapeutic effects 
on major diseases, rare diseases, or diseases of elderly and children, or with independent 
intellectual property rights, or listed in National Science and Technology Major Projects. (b) To adjust the policy for reviewing applications for clinical trials of innovative drugs. With regard 
to applications for clinical trials of innovative drugs for the first time, the technical requirements 
for the subsequent safety evaluation and pharmaceut ical evaluation shall be determined first; the 
safety evaluation shall center around the clinic al trial and drug development program, and risk 
management shall be strengthened; pharmaceut ical evaluation mode shall be adjusted. 
(c) To optimize the innovative drug review proced ure. To follow the innovative drug R&D law, allow 
the applicant to submit supplementary application materials step by step based on the R&D progress. 
 
3) Establishment of a system for reviewing OTC and promotion of switch OTC. OTC drugs which are approved overseas could be approved through an abbreviated review system. 
4) Safety requirements for cosmetic products.  
"National guidelines for application and evaluation of new ingredients for cosmetic products", which was notified on 11 June 2011 by G/TBT/N/CHN/821, is impeding the smooth import of cosmetic products to China. Also, it has been pointed out that technical standards for products 
imported from outside China are stricter than the on es for the products from China, such as animal 
tests exemption. Technical requirements reflecting the globally accepted standards should be implemented. 
 
Answer 
1. The domestic cosmetics companies are required  to obtain the production licenses issued by 
provincial food and drug regulatory authoritie s before the production and sales of cosmetic 
products, and are also subject to the daily superv ision of regulatory authorities at all levels 
throughout the production process. The cosmetic products are manufactured under the supervision and guidance of regulatory authorities throug hout the manufacturing process; however, the 
regulatory authorities can only determine the safe ty of imported products through product (final 
product) review. In China, domestic cosmetic products for non-special purpose are subject to record review, while imported cosmetic products for non-special purpose are subject to 
administrative licensing; however, domestic and imported cosmetic products are subject to the 
same requirements on corporate safety, product safety and materials preparation. 2. The review and approval procedure is a re quirement set in the Regulations on Hygiene 
Supervision of Cosmetics implemented in 1989. Strict  enforcement of existing regulations is also a 
part of government administration by law.  5) Issuance of Free Sales Certificate (FSC). WT/TPR/M/300/Add.1 
 
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 It is pointed out that the requirement of FSC prevents products launched simultaneously in the 
country of origin and in China from being registered in China, or they will be registered with great 
delay. 
 
Answer 
1. Production Certificate and Sales Certificat e mentioned in Article 3 and Article 4 of the 
Requirements for Administrative License Application Materials of Cosmetic Products (Guo Shi Yao 
Jian Xu No. 856 [2009]) rather than Free Sales Certificate mentioned by Japan and Canada are required to be submitted for cosmetic product license application. 2. To protect consumer safety and prevent co mpanies from taking consumers of the import 
country as the first testers of products associated with health and safety, it is required that 
certificates showing the products are manufacture d and sold in the producing country/ region or 
country/region of origin shall be submitted for the import of the cosmetic products. This 
requirement was notified to WTO member states following WTO/TBT rules in 2009. 
3. The certificates shall be submitted as part of administrative license application materials of imported cosmetic products. The domestic manufacturing enterprises are not allowed to 
manufacture or sell cosmetic products before they obtain the administrative licenses, so they are 
unable to submit Production Certificate and Sales Certificate as part of administrative license application materials of their cosmetic products. This is why Production Certificate and Sales Certificate are not required to be submitted as part of administrative license application materials 
of domestic cosmetic products. It is not a special treatment to domestic enterprises. 
 (Question 19: Page 74, Paragraph 3.69) 
TBT Agreement Annex 3 L stipulates that "Before adopting a standard, the standardization body 
shall allow a period of at least 60 days for the submission of comments on the draft standard by interested parties within the territory of a Member of the WTO". SAC accepts TBT Agreement 
Annex 3 "Code of Good Practice". Does SAC allow a period for public comment of at least 60 days 
before adopting GB-T Standards?   Answer 
According to the Administrative Measures on National Standards, the technical committee allows a period of 2 months for the submission of comment s on the draft standards by interested parties, 
including manufactures, distributors, users, resear ch institutions, testing agencies and other units, 
after it issues the draft standards to them in the standard-setting process. 
 (Question 20: Page 74, Paragraph 3.69) 
TBT Agreement Annex 3 J stipulates that "At least once every six months, the standardizing body 
shall publish a work programme containing its name and address, the standards it is currently preparing and the standards which it has adopted in the preceeding period "and" The work programme shall for each standard indicate, in accordance with any ISONET rules, the 
classification relevant to the subject matter, the stage attained in the standard's development, and 
the references of any international standards taken as a basis". SAC accepts TBT Agreement Annex 3 "Code of Good Practice". Does SAC publish the said work programme including 
international standards? How can it be seen (e.g. on a particular website)?  
 Answer 
The competent national standardization authority issues the work plans for revision of national standards at least twice per year. A work plan includes the names of the proposed standards, the technical committees in charge of the standard s, standard type, main drafters and other 
information. Please log on at the official website of National Standardization Management 
Committee: http://www.sac.gov.cn to check such info rmation. In addition, the official website of 
National Standardization Management Committee also  provides national standard announcements, 
full-text queries for mandatory national standards, industrial standard filing announcements, local 
standard filing announcements and other information. 
 (Question 21: Page 74, Paragraph 3.69) 
Does SAC use Regulatory Impact Assessment? If so, how?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
To guide the maintenance and revision of na tional standards, National Standardization 
Management Committee is soliciting comments on the problems from the implementation of such 
standards by central and local authorities. We will organize the post-implementation review of 
national standards in the next step.  
(Question 22: Page 74, Paragraph 3.70) 
When submitting TBT notifications, does the Gove rnment of China take into considerations the 
decisions of the WTO and the TBT Committee that th e notification period should be at least 60 
days, and the period for the entry into force from the publication of the draft should be at least 6 
months? 
 Answer 
China generally allows a period of 60 days for the submission of comments and a transitional period of 6 months. Since joining the WTO, the Chinese government has conscientiously fulfilled its responsibilities for notifying mandatory nation al standards and responding to comments and 
consultations under WTO commitments in strict accordance with WTO procedures and 
requirements. China notifies the WTO Secretariat of any draft mandatory national standard that is not in line with international standard and may have a significant impact on international trade, and allows a period of 2 months for the submi ssion of comments by WTO member states, in 
accordance with WTO requirements. In accordance with the requirements of the relevant 
documents, the period from the publication of th e draft to the entry into force of the standard 
should be six months to a year. 
 
(Question 23: Page 74, Paragraph 3.70) Regarding the TBT notification of G/TBT/N/CHN/1016 on "National Standard of Lithium Ion Cells 
and Batteries used in Portable Electronic Equipm ent – Safety Requirement", the draft GB does not 
use IEC 62133 edition 2 as a basis in the following points:  - Approximately 70 % of the items proposed in dr aft GB do not conform to IEC62133 edition 2. 
- The requirement specified in the draft GB contain inappropriate test items that do not conform to 
the scope of the notified document. 
We request clarification as to the above nonconformity and for the draft GB to be reconsidered so that they harmonize with IEC62133. 
 
Answer 
Since 2007, several accidents happened around the world due to problems caused by lithium 
batteries, including one death case in China. In order to protect consumer's safety and health, 
China drafted a national standard Safety Requirement for Lithium Ion Cells and Batteries used in Portable Electronic Equipment. An ad hoc working group was established in 2008 to develop this standard. Members of the working group contained more than 40 lithium producers and science 
research institutes both domestic and abroad, in cluding many foreign enterprises. Within 3 years 
in-depth discussion and wide range survey of the industry, a final version of draft standards was 
formulated after 3 rounds of comments soliciting. 
With regard to the comment that the standards is not in accordance with relevant international 
standard IEC62133, it needs to be noted that China has identically transformed IEC62133 to a 
national standard GB/T28164-2011. And the standard under discussion is the supplement and 
improvement of GB/T28164-2011. Similar cases are also found in other members. Such as the 
relationship between standard JIS C8712:20 06 with IEC62133:2002, and JIS C8714:2007 of 
Japan. Due to the different scope of application, the Chin ese standard is not directly correspondent to IEC 
62133. It adopts the relevant criteria of IEC 62133, when appropriate, and improves the IEC 
standard according to the characteristics of the lithium battery. A number of proposals based on this Chinese standard have been adopted by the IE C, which illustrated its effectiveness. Therefore, 
we did not find that this Chinese standard, which is based on relevant international standard, 
violated any TBT provision or principle.
） 
 WT/TPR/M/300/Add.1 
 
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 (Question 24: Page 74, Paragraph 3.70) 
Regarding the provisions for the Administration of Cosmetics Application Acceptance which was notified to the WTO/TBT committee (G/TBT/N/CHN/821, G/TBT/N/CHN/937), we have concerns on 
the following 2 points:  
Since the implementation of the Guidance in May 2011, only 4 new ingredients have been registered. 
The Guidance which requires safety data on isol ated components of plant extracts and fermented 
solutions is excessive and trade restrictive measures. 。 
We therefore request clarification on the above nonconformity and for reconsideration of the 
measures taken so as to be consistent with the TBT Agreement.  
 
Answer 
Provisions for the Administration of Cosmetics Application Acceptance & Cosmetics Label 
Instructions Regulations and Guidance for the Cosmetics Label Instructions. 
China would like to thank EU and Japan for their interest in the Chinese measure. We have closely cooperated with our trading partners in the implementation of the regulation, which was notified 
on 20 May 2011 according to the transparency prin ciple of the TBT Agreement. In addition to 
cooperation at the governmental level, we have  kept our bilateral channel open and formed 
working group on this issue with the EU, Japan and Korea. Through this platform, we have been keeping continuous communication and discussion at both administrative and technical level. For 
example, on June 5th, we had a thorough discussi on with officials from DG-SANCO of the EU in 
Beijing. We believe the specific technical issu es can be solved by bilateral communications 
between technical experts. China will keep the b ilateral channel open and transparent to ensure 
the smooth implementation of the regulation . 
 Inventory of used cosmetics ingredients in China is still under drafting, it is not a "positive list" on 
cosmetic materials, but only developed to distinguish if one material is firstly used in cosmetics 
produced or sold in China. This document is made to design a sole standard on approving new cosmetic materials, to prepare for devolving responsibility of managing imported "normal 
cosmetic" registrations to provincial-level author ities. CFDA has carried out two rounds of public 
opinion soliciting, and the industry has added over  10,000 existing material to CFDA. Except the 
materials banned for safety hazards, all cosmetic materials that have been used in the Chinese market will be included in this document. Every ki nd of material will be marked by both Chinese 
and INCI name. At the present stage, CFDA is still finalizing this document. 
 Adjustment of Cosmetic New Ingredient Registration Management (G/TBT/N/CHN/1019) is issued 
to accelerate the approval procedure of new cosmetic materials through an adjustment on 
administration level.  As for Cosmetics Label Instructions Regulations and Guidance, due to the adjustment of CFDA's legislation plan, there will be a new regulation on cosmetics labelling before the end of 2014, and 
CFDA will notify it to WTO.  
 (Question 25: Page 74, Pa ragraph 3.70, Table 3.6) 
According to Paragraph 3.70, during the period under review, China submitted 167 TBT 
Notifications. Whilst according to Table 3.6, more than 700 mandatory standards were developed during 2012-2013. Japan would like to know what explains this gap. Is it correct to interpret that 
not all of the mandatory standards were notified to the WTO Members? If so, what was the reason 
for not notifying the WTO?  
 Answer 
Whether it is necessary to notify the WTO of a draft mandatory national standard is mainly determined based on the requirements in the Ag reement on Technical Barriers to Trade and the 
Agreement on the Application of Sanitary and Phyt osanitary Measures: the draft national standard 
shall be notified to the WTO, if there is no inte rnational standard relevant to the draft national 
standard, or the technical content of the draft national standard is not in line with the technical content of the relevant international standard, and the draft national standard may have a 
significant effect on the trade of other WTO member  states; there is no need to notify the WTO of 
the draft national standard, if the draft national standard is equivalent to an international standard, regardless of its impact on trade. Therefore, the number of the notified mandatory 
standards is less than the number of the established mandatory standards. WT/TPR/M/300/Add.1 
 
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3.3 MEASURES AFFECTING PRODUCTION AND TRADE 3.3.2 Competition policy and price controls 
3.3.2.6 Price controls 
 (Question 26: Page 101, Paragraph 3.169) 
Drug price is controlled by NDRC. Could Chin a explain how NDRC guarantees predictability, 
fairness and transparency in price controlling processes?  1) The evaluation standards of quality and value of new drugs  2) The problems and the solutions of the listing process of drugs into the national reimbursement 
drug list and bidding rules  
 Answer 
The competent pricing authority actively promoted  the drug reform, established new systems, and 
improved policies in recent years. It has formed  a set of basic procedures including cost price 
survey, expert evaluation or demonstration, solic itation of comments from all sides, collective 
deliberation, introduced the Rules on Relative Pric es of Drugs, and established an ex-factory drug 
price survey and on-line monitoring system. 
 
Currently, with regard to the drugs in the Catalogue of Drugs for Basic National Medical Insurance, the maximum retail prices are set by the government, while the transaction prices, such as ex-factory prices, wholesale prices and retail prices, are formed by market competition between 
sellers and buyers. Before the drugs, whether subject to government-set prices or market-set 
prices, are sold in public hospitals, purchase pr ices must be determined by bidding organized by 
local health authorities. 
 
3.3.4 Government procurement  (Question 27: Page 105, Paragraph 3.176) 
According to the Report by the Secretariat, the efforts to make government-procurement-related 
information publicly available have been stepped up. Please provide more detailed information about the concrete measures of the Chinese Gove rnment for ensuring transparency. Specifically, 
Japan would like to know whether government-procurement-related information such as notices 
for tender are available in English.   
Answer 
China is developing the Rules for Implementation of Government Procurement Law. The Rules will 
further clarify government procurement-related in formation disclosure requirements. Government-
procurement-related information, like notice for tender, is not available in English.  
 
(Question 28: Page 105, Paragraph 3.178) According to the report by the Secretariat, local governments account for 87.6 % of the total value 
of government procurement in 2011. Please provide the breakdown of local government 
procurement, and the name of the top 10 local entities with their shares of total value.  
 
Answer 
According to statistics, in 2011, the local government procurement of goods reached 347.205 
billion yuan, the local government project procur ement reached 638.364 billion yuan, and the local 
government procurement of services reached 79.146 billion yuan. Top 10 entities are Anhui, 
Guangdong, Guangxi, Hebei, Henan, Jiangsu,  Liaoning, Shandong, Shanghai, and Zhejiang. 
 (Question 29: Page 105, Paragraph 3.178) 
The Report by the Secretariat states that the Chinese Government conducts procurement using 
fiscal funds, for goods, construction, and serv ices listed in the "Centralized Procurement 
Catalogue" or above the threshold using other financial resources. Please provide the total value of 
government procurement not listed in the Catalogue and below the threshold using other financial 
resources.  
 Answer 
China has no statistical data in this regard. WT/TPR/M/300/Add.1 
 
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  (Question 30: Page 106, Paragraph 3.182) 
The Report by the Secretariat mentions that Article 8 of MOF Order No. 18 of 11 August 2004 
states that the suppliers participating in the bids  for supply of goods or services under government 
procurement must be domestic suppliers who supply domestic goods or services, but it also says 
that the Chinese Government has been implementing a policy to facilitate the procurement of foreign products since 2007. Please provide ou tstanding examples and some results of such 
facilitation policy.  
 Answer 
The Chinese government applies non-discriminatory and equal treatments to products 
manufactured by domestic-funded and foreign-funded  enterprises within the territory of China in 
government procurement. It is common for the government to purchase foreign products, and thus we do not conduct such case studies or statistics specifically. 
 
(Question 31: Page 108, Paragraph 3.193) According to the Report by the Secretariat, the finance authorities accepted 521 complaints in 
2011. Does China have cases where finance authorities ruled and ordered procuring entities to 
restart the procurement process again from the beginning? Please provide the number of 
complaints raised by foreign suppliers in 2011.  
 
Answer 
China has cases where procuring entities are ordere d to reject all bids and restart the procurement 
process again from the beginning. There is no statistics of foreign supplier complaints by 
nationality. 
 (Question 32: Pages 108-109, Paragraph 3.195) 
The Report by the Secretariat states that impo rts used for procurement purposes still require 
approval from the Ministry of Finance and they are governed by the Administrative Measures for 
Government Procurement of Improved Products. Plea se explain what kind of conditions should be 
met in accordance with the Administrative Measures. Were such procedures designed for the 
purpose of protecting domestic products or services?  
 Answer 
According to the Administrative Measures for Government Procurement of Imported Products, government procurement of imported products should follow the following requirements: when the purchaser cannot get the products or cannot get the products in reasonable commercial terms and 
conditions in China, or when the purchaser is requ ired to purchase imported products by laws and 
regulations, the purchaser shall carry out governme nt procurement activities in accordance with 
laws after obtaining the approval of the finance department of the government. The purpose of the 
Administrative Measures is to implement the requirements of the Government Procurement Law 
and standardize government procurement of imported products. 
 (Question 33: Page 109, Paragraph 3.196) 
The Report by the Secretariat states that, since 1 December 2011, there are no longer any 
conditions attached to government procurement re garding "indigenous innovation". Please explain 
the view of the Chinese Government on how strictly the rules have been observed in provincial and 
local governments. 
 Answer 
The Chinese government promised no link between the indigenous innovation policies and the 
preferential government procurement policies in 2011. It is understood that local governments 
have cleaned out the links between the indigenous innovation policies and the preferential government procurement policies according to requirements. 
 
(Question 34: Page 109, Paragraph 3.198) Japan welcomes China's intention to submit its fifth revised offer within this year. Japan 
understands that China needs further efforts to stipulate domestic laws and regulations so that the 
procurement by SOEs will properly be regulate d. Could China explain its plan to stipulate 
procurement rules for SOEs?   WT/TPR/M/300/Add.1 
 
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 Answer 
As market players operating independently, Chinese state-owned enterprises make their own 
purchasing decisions in accordance with market rules. At present, open tendering is generally 
adopted in the procurement of Chinese state-owne d enterprises. Chinese state-owned enterprises 
have established relatively sound internal management systems to ensure open and transparent procurement activities. 
 
3.3.5 Intellectual property rights 3.3.5.1 Overview and institutional developments  
(Question 35: Page 110, Paragraph 3.199 d.) 
The Report mentions that China has been streng thening copyright protection on the Internet; 
Japan would like to know: 
1) The legal basis for taking actions against copyright infringements on the Internet. 
2) How the copyright holder is identified and the infringement is determined when a petition is 
filed for copyright infringement.  
Answer 
The Chinese Government has promulgated the Copyri ght Law of the People's Republic of China, 
the Regulations on Implementation of Copyright La w of the People's Republic of China, and the 
Regulations on Protection of the Right to Networ k Dissemination of Information of the People's 
Republic of China to combat Internet piracy. Supreme People's Court, Supreme People's 
Procuratorate and Ministry of Public Security issued the Opinions on Several Issues concerning the 
Application of Law in Handling Criminal Intellectual Property Right Infringement Cases in 2011 to fight against criminal infringement on the Internet.  
In general, according to the Chinese laws, the copy right in a piece of work shall be enjoyed by the 
author. In addition to the author, other citizens, legal persons or organizations may also enjoy the 
copyright according to the agreement with the author or the copyright law. Therefore, the 
copyright holder shall provide appropriate proof of entitlement when filing an infringement 
complaint.  
 
After receiving an infringement complaint, the administrative law enforcement authority and the 
court shall determine whether there is infringement in the case. If there is infringement in the case, the court will issue a civil judgment based on  actual situation, requiring infringer to stop 
infringement, eliminate the effects, apologize, and compensate for damages. For infringement 
harming the public interest, the administrative law enforcement authority may impose 
administrative punishment on infringer, such as requiring infringer to stop infringement, 
confiscating the illegal incomes, confiscating and destroying infringing copies, imposing fines, and 
confiscating materials, tools, and equipment mainly used for making infringing copies. 
 (Question 36: Page 110, Paragraph 3.200) 
Regarding the Administrative Measures on Prioritized Examination of Invention Patent Application, 
we would appreciate it if any statistics and other relevant information such as the number of applications would be provided. It is stipulated in Article 10 of the Administrative Measures on Prioritized Examination of Invention Patent Application that the first notice of argument on 
examination should be sent within 30 days from the date on which the request of the priority 
examination is approved. In actual cases, how long does it take from the approval of a request of the priority examination until the notice of the first action of substantive examinations?  
 
Answer  
Administrative Measures on Prioritized Examinat ion of Invention Patent Application came into 
effect on August 1st, 2012. In 2013, over 5,800 cases on priority review of invention patent 
application were accepted by SIPO, and all of them were handled in a timely manner. At present, it 
takes on average 28 days for SIPO to issue the primary review notification since the day the review is granted. 
 WT/TPR/M/300/Add.1 
 
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 3.3.5.2 Industrial property 
3.3.5.2.1 Patents  
(Question 37: Page 111, Paragraph 3.202) 
It is widely believed that SIPO issued an internal guideline over the written description of Art. 26.3 of the Patent Act. We would like to know  when SIPO will publish the guideline.  
 
Could China provide us with the rate of chemistry applications refused on the ground that the application fails to meet the requirements of Art. 26.3? Japan also would like to know if there are 
any differences in the refusal rate due to Art.  26.3 between chemistry applications and patent 
applications in other technical fields which SIPO processes.  
Answer 
To help examiners to have an accurate understandi ng and proper use of Article 26.3 of the patent 
law, SIPO formulates relevant guidance for implementation. Such guidance is completely in 
compliance with relevant provisions in the patent law and review guidelines. Therefore, it is not 
new standards. 
 
SIPO has not counted the amount of applied chemicals that have been rejected on the basis of Article 26.3, nor has it compared the amount of patent applications in other fields that have been rejected with the amount of rejected chemicals. 
 
(Question 38: Page 112, Paragraph 3.207) With regard to the Regulations on the Administrati on of Technology Import and Export, as revised 
in December 2010 (hereinafter "the Regulations"), Japan is interested in knowing how the actual 
practice is being conducted under the Regulations since the amendment was made. Could China provide statistics, with detailed breakdown, on actually concluded technology transfer contracts 
that are subject to the Regulation? In particular, breakdown in terms of exporting countries 
(licensor countries) for technology import and breakdown in term of importing countries (licensee countries) for technology export, would be appreciated.  
Answer 
China encourages the import of advanced and appropriate technologies. The import of 
technologies that meet any of the situations listed in Article 16 of Foreign Trade Law is banned or 
restricted. 
MOFCOM, together with other relevant departments, formulates, adjusts and publishes the Catalogue of Technologies Prohibit ed and Restricted from Import. 
 
(Question 39: Page 112, Paragraph 3.208) On the occasion of the last TPR of China, China explained, with regard to the Anti-Monopoly Law, 
that the competent department(s) would draft anti-monopoly guidelines regarding the abuse of 
IPR. Could China explain the current stat us of the drafting of the guidelines?  
 Answer 
We are soliciting comments from the public at the official website of Legislative Affairs Office of the State Council and State Administration for Industry and Commerce.  
(Question 40: Page 112, Paragraph 3.208) 
Could China elaborate on the cases where an "abuse" of a patent restricts/limits competition and fulfills the conditions for an issuance of compulsory license?   
Answer 
State Administration for Industry and Commerce does not have such case. 
 WT/TPR/M/300/Add.1 
 
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 3.3.5.2.2 Trademarks  
 (Question 41: Page 115, Paragraph 3.223) 
Japan is interested in the effective prevention of ma licious registration (or registration in bad faith) 
of others' trademarks. In this connection, the Secretariat Report mentions "the introduction of the principle of good faith for the registration and use of trademarks" as one of the changes to the 
Trademark Law introduced by the third amendmen t. Could China elaborate on this point by 
referring to relevant provisions of the amended Trademark Law (e.g. Articles 7, 15, 32)?   Answer 
China has completed the revision of the Trad emark Law. The new Trademark Law has been 
implemented since 1 May 2014. Article 7 of the ne w Trademark Law provides that any application 
or usage of a trademark shall abide by principles of good faith. Article 15 provides that, where an 
agent or representative, without the authorization of  the principal, seeks to register in the agent's 
name the principal's trademark and where the principal objects, registration shall be refused and  
the use of the trademark shall be prohibited. Wher e a trademark registration application is for a 
trademark that is identical or similar to a prior unregistered trademark belonging to a third party, 
and it covers identical or similar goods, and th e applicant has a contractual, business or other 
relationship with that third party other than that  stipulated in the preceding paragraph, and the 
applicant is well-aware of the existence of that  third party's trademark and such other party 
opposes registration, the registration of the tradem ark shall be refused. Article 32 provides that no 
trademark application shall infringe upon another party's existing prior rights. Nor shall an applicant rush to register in an unfair manner a trademark that is already in use by another party 
and enjoys substantial influence. 
 3.3.5.4 Other IPRs 
3.3.5.4.3 Undisclosed information and trade secrets  
 (Question 42: Page 118, Paragraph 3.241) The Secretariat Report notes that undisclosed information and trade secrets are covered under a 
number of laws and regulations, including "the La bour Law." Could China explain which provisions 
in "the Labour Law" provide for the protection of stipulated undisclosed information and trade secrets? 
 
Answer 
1. Article 22 of the Labor Law of the People's Repub lic of China provides: "The parties involved in a 
labor contract may reach an agreement in their labor contract on matters concerning keeping he 
commercial secrets of the employing unit."  Article 102 provides: "Laborers who revoke labor contracts in violation of the conditions specified 
in this Law or violate terms on secret-keeping matters agreed upon the labor contracts and thus 
caused economic losses to the employing unit shall be liable for compensation in accordance with the law." 
 
2. Article 23 of the Labor Contract Law of the Pe ople's Republic of China provides: "An employing 
unit and a worker may have such terms stipulated in the labor contract as keeping business 
secrets of the employing unit and keeping confiden tial the matters relating to its intellectual 
property rights. With regard to a worker who has a confidentiality obligation, the employing unit may have stipulated in the labor contract or confidentiality agreement competition restriction and payment of financial compensation to him on a monthly basis during the term of the competition 
restriction after the labor contract is revoked or terminated. If the worker breaches the stipulation 
on competition restriction, he shall pay penalty to the employing unit as agreed upon." Article 24 provides: "The persons subject to competition restriction shall be limited to senior 
managers, senior technicians and other persons who are under the confidentiality obligation to the 
employing unit. The scope, geographic area and term of competition restriction shall be agreed upon by the employing unit and the worker, and such  agreement shall not be at variance with the 
provisions of laws and regulations. 
The term of competition restriction, calculated from the revocation or termination of the labor contract, for one of the persons, as mentioned in the preceding paragraph, to go to work for a competing employing unit that produces or deals in the same type of products or is engaged in the WT/TPR/M/300/Add.1 
 
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 same type of business as his original employing unit, or to establish his own business to produce 
or deal in the same type of products or engage in the same type of business shall not exceed two years." 
Article 90 provides: "Where a worker revokes the la bor contract in violation of the provisions of 
this Law or breaches the confidentiality obligation or competition restriction stipulated in the labor contract, thus causing losses to the employing unit, he shall be liable for compensation." 
 
(Question 43: Page 118, Paragraph 3.243) With regard to the test data protection mentioned in the above paragraph, Japan would like to have answers to the following questions: 
1) How do you confirm that the data was "independently collected" by the applicant so that the 
exception provided by Art. 20 of the Regulation s for the Implementation of the Law on Drug 
Control from the protected data is applicable?  
2) Could China explain the actual means to keep  the examiners from referring to the protected 
test data when they examine the application, which contains published or independently collected data? 
3) Does China treat differently domestically collected data from foreign data? If so, please 
elaborate on the difference in treatment. 4) Please elaborate on the current situation of im plementations of Art. 66 of the Regulation for the 
newly approved drugs. Will a five-year monitoring period also be set for drugs approved first in 
foreign countries? 
 Answer 
We are coordinating with relevant authorities.  (Question 44: Page 118, Paragraph 3.244)  
The Secretariat Report notes that China is committed to prioritizing trade secrets in its IPR 
protection policies and to increasing enforcement in this area under the schemes of the U.S.-China 
Strategic and Economic Dialogue (S&ED) and the U.S.-China Joint Commission on Commerce and Trade (JCCT). In that respect, does China ha ve concrete plans to fulfill the commitment?  
 
Answer 
China takes "strengthening law enforcement for trade secrets protection and improving judicial 
protection of trade secrets" as a focus of the work to combat IPR infringement and production and 
sales of counterfeit and shoddy goods in 2014, requiring "to take further actions against illegal 
activities, such as obtaining trade secrets of th e right owner by stealing, inducement, coercion, 
and other improper means, and disclosing, using, or allowing a third party to use trade secrets of 
the right owner in an unauthorized manner that  constitutes a breach of agreement on trade 
secrets protection with the right owner, and to strengthen law enforcement and judicial protection; to improve relevant systems, increase efforts to deal with complaints, and protect commercial 
secrets in technical data submitted by companies a ccording to laws; to try and make public typical 
cases of misappropriation of trade secrets according to laws."  
The national leading group for combating infringement and counterfeits requires to strengthen 
investigations into clues in complaints involvin g trade secrets, carefully investigate and handle 
criminal cases of misappropriation of trade secrets, and focus on five tasks: to coordinate and 
supervise the handling of important trade secrets disputes and cases of misappropriation of trade 
secrets; to try and make public typical cases of misappropriation of trade secrets according to laws; to improve relevant systems and protect commercial secrets in technical data submitted by companies according to laws; to organize publicity and education campaigns for trade secrets 
protection to raise the awareness of the public an d enterprises; to conduct legislative studies on 
trade secrets protection, study and improve the pr ovisions concerning preliminary injunction and 
pre-trial evidence preservation in cases associated with trade secrets disputes. 
 WT/TPR/M/300/Add.1 
 
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 3.3.5.5 Enforcement 
3.3.5.5.1 Overview  
(Question 45: Pages 118-119, Paragraph 3.245) 
Which law enforcement organizations at the national and local level have the authority to investigate IPR - infringement crimes?  
Answer 
China takes both administrative and judicial measures to protect intellectual property rights. 
Intellectual property protection involves multiple departments.  
Administrative law enforcement:  
The department for Industry and Commerce Administ ration is responsible for enforcement of laws 
and regulations-related to the protection of tr ade secrets and intellectual property rights like 
trademark right; the department for copyright administration is responsible for enforcement of 
laws and regulations related to the protection  of copyright; the department for Patent 
Administration is responsible for enforcement of la ws and regulations related to the protection of 
patent and layout-design of integrated circuit; the department for Agriculture Administration, the 
department for Industry and Commerce Administration, and the department for Quality Inspection Administration are responsible for enforcement of laws and  regulations related to the protection of 
geographical indications; the department for Agriculture Administration and the department for 
Forestry Administration are responsible for enfo rcement of laws and regulations related to the 
protection of new varieties of plants; the Customs is responsible for intellectual property protection 
in import and export. 
Criminal justice:  
The public security authorities investigate su spected criminal IPR infringement cases; the 
administrative law enforcement authorities transf er the suspected criminal cases to the public 
security authorities, if they find the violation cases investigated by them are associated with 
crimes; the procuratorial organs approve the arrest of and prosecute the suspects for crimes according to laws, supervise case filing by pub lic security authorities, case transfer by 
administrative law enforcement authorities, and case hearing by courts; the courts hear and try 
the IPR infringement cases according to laws. 
 Civil justice:  
The courts hear and try IPR-related cases based on the claims of right owners and according to 
laws.  
(Question 46: Page 119, Pa ragraph 3.246, Table 3.22) 
Abolishment of the requirement of legalization of evidence to be used in court by diplomatic or 
consular agents will simplify the process and encourage early settlement of these disputes to some extent. Do you have a plan to ratify the Convention Abolishing the Requirement of Legalisation for 
Foreign Public Documents?  
 Answer 
According to Article 3 of the Procedural Law of the People's Republic of China on Conclusion 
of Treaties, the State Council is in charge of concluding treaties and agreements with other countries, the Standing Committee of the National People's Congress decides the approval and 
abolishment of treaties and important agreements with other countries, and the Ministry of Foreign 
Affairs is in charge of specific affairs regarding treaties and important agreements with other countries. China has not rectified Convention Abolishing the Requirement of Legalisation for Foreign Public Documents. 
 
(Question 47: Page 119, Pa ragraph 3.246, Table 3.22) 
In Table 3.22, there are no data regarding the number of criminal prosecutions, while there are 
data regarding administrative actions and civil cases. Please provide statistical data that indicate 
the number of cases and arrested offenders related to IPR-infringement crimes in 2012 and 2013 (Respectively, the Patent Law, Trademark Law, Copyright Law, and other IPR-related Laws)  
 
Answer 
Please refer to question 48.  WT/TPR/M/300/Add.1 
 
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 (Question 48: Pages 119-120, Paragraph 3.247) 
Please indicate the types and numbers of confiscated items as well as the ratio of each item during 
the campaign "Drawing Sword".  
Answer 
In 2012, for intellectual property-related criminal cases of first instance handled by local courts, 
new filings reached 13,104 cases. As for the newl y filed cases, plaintiffs in 7,840 cases claimed 
crime of intellectual property infringement, plaint iffs in 2,607 cases claimed crime of production 
and sales of fake or inferior goods involving inte llectual property infringement, plaintiffs in 2,587 
cases claimed crime of illegal business operations  involving intellectual property infringement, 
plaintiffs in 70 cases claimed crimes of other nature involving intellectual property infringement. The number of intellectual property-related criminal  cases of first instance concluded by the local 
courts reached 12,794 cases. As for the concluded cases, offenders in 7,684 cases were convicted 
of infringement of intellectual property; offender s in 2,504 cases were convicted of production and 
sales of fake and inferior goods (involving inte llectual property infringement); offenders in 2,535 
cases were convicted of illegal business operatio ns (involving intellectual property infringement); 
offenders in 71 cases were convicted of crimes of  other nature (involving intellectual property 
infringement). As for the cases where the offender was found guilty of intellectual property infringement, offenders in 2,012 cases were convicted of counterfeiting a registered trademark;  
offenders in 1,906 cases were convicted of selling goods bearing a counterfeit trademark; 
offenders in 615 cases were convicted of illegally  manufacturing or selling illegally manufactured 
counterfeit marks; offenders in 63 cases were co nvicted of patent counterfeiting; offenders in 
3,018 cases were convicted of copyright infringement; offenders in 27 cases were convicted of 
selling infringing reproductions; and offenders in 43 cases were convicted of trade secrets 
infringement.  
 
In 2013, for intellectual property-related criminal cases of first instance handled by local courts, 
new filings reached 9,331 cases. As for the newly filed cases, plaintiffs in 5,021 cases claimed intellectual property infringement crime (plaintiffs in 3,473 cases claimed registered trademark 
infringement crime and plaintiffs in 1,484 cases claimed copyright infringement crime), plaintiffs in 
2,455 cases claimed crime of production and sales of  fake or inferior goods involving intellectual 
property infringement, plaintiffs in 1,686 cases claimed crime of illegal business operations 
involving intellectual property infringement, plaint iffs in 169 cases claimed crimes of other nature 
involving intellectual property infringement. The number of intellectual property-related criminal 
cases of first instance concluded by the local courts reached 9,212 cases. As for the concluded 
cases, offenders in 4,957 cases were convicted of  infringement of intellectual property; offenders 
in 2,390 cases were convicted of production and sales of fake and inferior goods (involving intellectual property infringement); offenders in 1,712 cases were convicted of illegal business operations (involving intellectual property infrin gement); offenders in 153 cases were convicted of 
crimes of other nature (involving intellectual pr operty infringement). As for the cases where the 
offender was found guilty of intellectual proper ty infringement, offenders in 1,546 cases were 
convicted of counterfeiting a registered trademark; offenders in 1,496 cases were convicted of 
selling goods bearing a counterfeit trademark; offenders in 350 cases were convicted of illegally 
manufacturing or selling illegally manufactured counterfeit marks; offenders in 1 case were convicted of patent counterfeiting; offender s in 1,499 cases were convicted of copyright 
infringement; offenders in 15 cases were convicted of selling infringing reproductions; and 
offenders in 50 cases were convicted of trade secrets infringement. For intellectual property-related criminal cases of second instance handled by local courts, 662 were accepted and 627 were concluded. 
 
(Question 49: Pages 119-120, Paragraph 3.247) During the series of campaigns, have the Chinese law enforcement authorities acknowledged any 
criminal organizations or individuals that exported counterfeit or imitation commodities to Japan or 
other foreign countries?  
 
Answer 
China Customs seizes a large number of counterfeits and imitation commodities to be exported to 
other countries each year, including goods to be exported to Japan, but cannot determine whether any criminal organization is involved. 
 WT/TPR/M/300/Add.1 
 
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 3.3.5.5.2 Administrative enforcement 
3.3.5.5.2.2 Copyright admini strative law enforcement 
 
(Question 50: Pages 120, Paragraph 3.251) 
The Report mentions that as a consequence of th e "Online Sword Campaign", a certain number of 
copyright infringement cases were reported fo r investigation. Japan would like to know:  
1) Among the cases reported, the number of cases in which the copyright holder is a non-Chinese, 
and the number of cases involving Japanese content.  2) The number of online copyright infringement cases reported since 2013. 2013.  
Answer 
National Copyright Administration carries out the "Online Sword Campaign" to combat Internet 
piracy. It calculates the number of cases by type of infringing works rather than nationality of 
copyright holder. Therefore, it does not have stat istical data of the cases in which the copyright 
holder is a non-Chinese or the cases involving Ja panese content. Local authorities for copyright 
administration received a total of 512 complaints in the "Online Sword Campaign" last year.  
4 TRADE POLICIES BY SECTOR 
4.2 Services 4.2.1 Telecommunication services 4.2.1.1 Market overview 
 
(Question 51: Pages 133, Paragraph 4.38, Box 4.2)  Does China have any regulation of the major suppliers which have a large share in the fixed or 
mobile markets in order to promote competition?  
 Answer 
The Telecommunications Regulations includes provisions on the interconnection between telecommunications networks. Please refer to Articles 17-22 for the details. The regulatory authorities have developed the Regulations on Ad ministration of Interconnection between Public 
Telecommunications Networks and the Measures fo r Settlement between Internet Exchange Center 
Networks to ensure the implementation of the above provisions. 
 (Question 52: Pages 133, Paragraph 4.38, Box 4.2) 
Is there any plan to relax restrictions on foreign investment?  
 Answer 
As for e-commerce, the Chinese government is studying the feasibility of applying Shanghai Free Trade Area experience in relaxing e-commerce-related restrictions on the access to value-added telecom market in other areas, to phase out of the restrictions on the equity ratio of foreign investor in e-commerce joint venture. 
 
(Question 53: Pages 133, Paragraph 4.38, Box 4.2) Is there any plan to reduce the proportions of st ate-ownership participation? Are the proportions of 
state-ownership participation set by law?  
 Answer 
We are coordinating with relevant authorities.  4.2.1.2 Regulatory regime 4.2.1.2.4 Licensing 
 
(Question 54: Pages 134, Paragraph 4.38) Does China plan to issue any more basic telecommunication business licenses in addition to the 
four licenses currently being provided?  
 Answer 
China will determine future measures for reform and opening up of the telecommunications sector 
based on domestic market development. WT/TPR/M/300/Add.1 
 
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 14  PREGUNTAS DE MEXICO 
Sección Resumen 
 
Paragraph 12 
How does China align compromises on Investment Promotion and Protection Agreements on Protecting Foreign Investment with regards to Five – Year Plans and list of industries that can 
receive preferential treatment and the sectors in which investment is encouraged, just permitted 
or prohibited?   Answer 
In line with the needs of economic development, and following the requirements for adjusting national industrial structure, the Chinese Government revised the Catalogue for Guidance of Foreign Investment Industries, with the purpose of  continuing to actively and effectively using 
foreign investments, introducing advanced fore ign technologies and management experience, 
promoting the optimization and upgrading of in dustrial structure and maintaining national 
economic security. The "Twelfth Five-year Plan" is an overall planning of China's national social-
economic development for the years of 2011 to 2015. Catalogue for Guidance of Foreign 
Investment Industries (revised in 2011) reflects the requirements of the "Twelfth Five-year Plan" 
for improving the level of opening to the outside wo rld, energy saving and emission reduction, and 
environmentally-friendly development. It is in cons istent with the spirit of the "Twelfth Five-year 
Plan"  
 Currently the Agreements of Promotion and Protec tion of Investment signed between China and 
relevant countries do not contain the contents of accessing to specific industries. If the 
Agreements of Promotion and Protection of Invest ment to be signed in the future involve the 
commitments of accessing to specific industries, the stipulations in China's Catalogue of Guidance 
of Foreign Investment Industries will not conflict with those of the agreements.  
 Paragraph 13 What are the main and type of incentives gran ted by the Chinese government for favoring the 
establishment of joint ventures, particularly with regard to R&D activities? Are those incentives 
equally granted between the Chinese and foreign company? Which are the most common departments granting those benefits? How do China protect intellectual property on those joint 
ventures? What does China mean with income tax reductions? Are there any tax rebates on 
purchases of domestically produced products? What  is the meaning of preferential lending? Which 
are the Government Procurement Policies to pu rchase from this type of companies?  
 
Answer 
With regard to project management mode. In accordance with Administrative Measures on 
Verification, Approval and Filing of Foreign Investment Projects, the encouraged items where there 
is no limitation to equity ratio need only to be filed, and the procedure of verification, approval and 
filing of such items is easy; the restricted item s are subject to verification and approval in 
accordance with limit of authority, and the veri fication and approval conditions, procedures and 
requirements are fairly complicated; the forbidden items refer to areas where the entry of foreign 
investment is not allowed.  
The encouraged items in the Catalogue for Guidance for Foreign Investment Industries enjoy the 
policy of being exempted from tariff levied on imported equipment for self-use, and there is no other preferential measure. The restricted items and forbidden items do not enjoy any preferential measure.  
 
For the research and development expenses incurred by any enterprise (including the foreign-invested enterprise registered in the territory  of China) for the purpose of developing new 
technologies, new products and new manufacturing process, where the research and development 
expenses are recorded into the profits or losses of the current period but have not resulted in 
intangible assets, the enterprise shall make a weighted deduction of 50% of the research and 
development expenses based on the truthful de duction of tax in accordance with relevant 
requirements; where the research and development expenses have resulted in intangible assets, 
the enterprise shall amortize the expenses at 150%  of the costs of the intangible assets. There is WT/TPR/M/300/Add.1 
 
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 no differential treatment in the application of the above-mentioned policy for domestically-funded 
and foreign-funded enterprises, and all enterprises may enjoy this policy.   
Paragraph 23 
What is the methodology used by China to prepar e the list of goods subject to "statutory" and 
interim export taxes issued every year?  
 
Answer 
Customs Tariff Commission of the State Council mainly decides and adjusts the import and export tariff rates in accordance with national economic development and the manufacturing, 
consumption, import and export of certain products and other circumstances, including the 
commodity to which provisional tariff rate is applied, tariff rate and time limit.   
Entorno Económico 
 
Paragraph 1.21 
Is it allowed a Foreign Invested Enterprise to apply for tax and administrative charge rebates and 
exemptions and the provision of special employ ment funds under the Employment Promotion Law 
(and related policies)? What are the main incentives granted? Income tax reductions? Are there any tax rebates on purchases of domestically produced products? Preferential lending? 
Government Procurement Policies to purc hase from this type of companies?  
 Answer 
China issues and implements a series of taxation policies to encourage laid-off workers, the disabled and other focus group of people to start up business or get employed. Details please find China's subsidy notification under SCM for 2005-2008 (G/SCM/N/155/CHN and 
G/SCM/N/186/CHN). 
 The Chinese Government does not make special stipulation or restriction on the suppliers of foreign-funded enterprises in terms of its purchasing policies.  
 
Paragraph 1.22 How financial institutions were encouraged to provide flexible loans to enhance support for export-
oriented enterprises? A legal foreign entity established in China (WFOES, EJVs, CJVs, JSCs) has 
also access to these preferential loans? Ar e there any limitation regarding industries?  
 
Answer 
China Export & Credit Insurance Corporation can basically meet various requirements of exporting 
enterprises through its insurance products and product mix. It is clearly stated in the management 
regulations of the corporation that any legal person legally established in China is entitled to 
become the insured of the corporation's insurance products. Currently, there is no definite industrial restriction.  
 
Régimen Comercial y de Inversiones 
 
Paragraph 2.40  
Which countries China has granted unilateral preferences under the LDCs policy? Which products and preferential rates have the government provided  preferential rates? In addition to that, are 
those countries receiving financial support (loans) by Chinese Development Banks of other Chinese 
Financial Institutions? If yes what are the main requisites such as to grant those loans: grants, 
interest rate, and payment terms? Are these unila teral preferences granted under the guidance of 
the Ministry of Commerce (Department of Foreig n Assistance)? What are the most important 
regions on the following years? 
 Answer 
China has already made commitment to give zero-tariff treatment to 97% of tariff lines import from the LDCs that have established diplomatic relations with China, and relevant measures will 
have been implemented in 2015. According to the principle of "one time commitment and step-by-
step implementation", this work will be completed in three stages, i.e. giving zero-tariff treatment 
to 60%, 95% and 97% of products under the tariff lines. Up to now, 35 LDCs, which have WT/TPR/M/300/Add.1 
 
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 established diplomatic relations with China, enjoy zero-tariff treatment with regards to 95% of 
their products under the tariff lines. Other LDCs, which have established diplomatic relations with China, are in the process of exchanging letters on this issue. For the list of 95% of products under 
the tariff lines, please visit:  
http://gss.mof.gov.cn/zhengwuxinxi/zh engcefabu/201312/t20131216_1024955.html. 
 
In 2008, commercialization reform was launched in China Development Bank (CDB). Modern 
financial enterprise system and internal corporate governance structure were basically established, whereby the shareholders general assembly, the bo ard of directors, the board of supervisors and 
the senior management take their respective responsibilities to implement commercialized 
operation in an all-round way following the principle of being independent in management and 
assuming risks and responsibilities for profits and losses on its own. CDB makes its own decision in granting loans by taking the risks of specific proj ects into consideration, following the requirements 
of bank credit management, and in accordance with the commercialization principles. There is no 
such issue of granting unilateral preferential treatment to any other country.  
 
Paragraph 2.41 and 2.42 
What are the main and type of incentives grante d by the Chinese government for encouraging the 
establishment of joint ventures, particularly with regard to R&D activities? Are those incentives equally granted between the Chinese and foreign company? Which are the most common 
departments granting those benefits? How do China protect intellectual property on those joint 
ventures? Income tax reductions? Are there any tax rebate on purchases of domestically produced 
products? Preferential lending? Government Procur ement Policies to purchase from this type of 
companies? 
 Answer 
For the purpose of reducing R&D expenditures of enterprises, China implements uniform policy of 
giving taxation support to foreign-funded R&D centers and domestically-funded R&D centers. Imported equipment is exempted from value-added tax.   
The Chinese Government does not make special stipulation or restriction on the suppliers of joint-
ventures in terms of its purchasing policies.  
 
Paragraph 2.45 
Do restricted and prohibited sectors under the Catalogue for the Guidance of Foreign Investment Industries are subject to any preferential regu latory framework than encouraged and permitted 
industries, such as income tax reductions, tax rebates on purchases of domestically produced 
products, preferential lending, and preferential access to government procurement programmes?  
 Answer 
The forbidden items in the Catalogue for the Guidan ce of Foreign Investment Industries refer to 
the areas where the entry of foreign investment is forbidden, so there is no preferential policy in this regard. The restricted items refer to the areas where the entry of foreign investment is 
restricted. Compared with encouraged items, the forbidden and restricted items do not enjoy the 
preferential treatment of reduction or exemption of tariff on imported equipment.   
Paragraph 2.47 
Which are the programmes used to grant preferenti al treatment to projects on the "encouraged" 
list of the Catalogue for Guidance of Foreign Investment? Which are their main characteristics and government institutions responsible for their design and implementation?  
 
Answer 
The encouraged items in the Catalogue for the Guidance of Foreign Investment Projects enjoy the 
policies of being exempted from the tariff on imported equipment for self-use. There is no other 
preferential measure.   
Párrafo 2.52 
¿Cómo se lleva a cabo el proceso de revisión de concentraciones en la práctica?   WT/TPR/M/300/Add.1 
 
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 Answer 
For details, please refer to the Anti-monopoly Law an d its relevant implanting rules. Please consult 
at: http://fldj.mofcom.gov.cn/. 
 
Paragraph 2.54 Which are the main incentives, programs established by the government to encourage the 
development of R&D cooperation between domestic and foreign enterprises? Are those programs 
aligned to specific industries and are supported by  a defined Budget? What are the main requisites 
a company shall comply (before –during) time th e Enterprise has being enjoying preferential 
treatment? Are the ministries granting preferential  treatment carrying out audit programs to verify 
receivers is complying with programs requisites?  
 Answer 
For the purpose of reducing R&D expenditures of enterprises, China implements uniform policy of 
giving taxation support to foreign-funded R&D centers and domestically-funded R&D centers. Imported equipment is exempted from value-added tax, and value-added tax on domestically-
manufactured equipment purchased is fully refu nded. The Chinese government does not make 
special stipulation or restriction on the suppliers of joint-ventures. Since 2011, the central finance has arranged special expenditures to support China's small and medium-sized enterprises to launch scientific collaboration with EU enterprises and research institutes in the areas relevant to 
energy-saving and emission reduction including new and renewable energies, energy saving and 
energy efficiency and clean technology.   
Párrafo 2.56 
¿Cuál es el mecanismo para solicitar la opinión del regulador o de la institución competente? ¿Son vinculantes estas opiniones?  
 
Answer 
In May 2014, NDRC issued Administrative Measures on Verification, Approval and Filing of Foreign Investment Projects. These Measures define the wo rk procedures of verifying, approving and filing 
foreign investment projects, and specify the way NDRC solicits the written review opinions of 
competent industrial authorities. In the process of reviewing foreign investment projects, NRDC will take the opinions of these competent authorities into overall consideration.  
 
Paragraph 2.70 and Table 2.4 Have the Chinese government identified loopholes by enterprises obtaining incentives in the form 
of preferential tax treatment under the Enterprise Income Tax Law? What actions have related 
authorities carried out to prevent misusing ince ntive programs under the Enterprise Income Tax 
Law? Which are the industries or commercial acti vities that are excluded from the incentives 
granted under the Enterprise Income Tax Law? Can an enterprise simultaneously enjoy different 
benefits granted under the Enterprise Income Ta x Law, for instance a High and New Technology 
Enterprise with a reduced rate of 15% can at the same time enjoy incentives regarding R&D 
expenses?  
 
Answer 
For enterprises that enjoy incentive measures in th e form of preferential taxation in accordance 
with Enterprise Income Tax Law, the Chinese government, by providing optimized services, 
enables those meeting relevant requirements to fully enjoy the preferential taxation policy. On the other hand, by strengthening the administration  on tax collection, the Chinese government 
prevents enterprises from abusing incentive measures by taking advantages of Enterprise Income 
Tax Law. The means of administration on tax collection include taxation assessment, tax auditing, 
tax inspection and anti-tax avoidance.   
In accordance with Notice on Several Issues on Implementing the Preferential Policy of Enterprise 
Income Tax (Cai Shui [2009] No.69), an enterprise meeting the stipulated conditions can enjoy at the same time various preferential taxation measures stipulated in both Enterprise Income Tax 
Law and its implementation regulations. For example, a hi-tech company can enjoy both a 15% 
tax reduction and incentive measures in terms of research and development expenditures.   WT/TPR/M/300/Add.1 
 
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 Párrafo 2.86 
¿Cuándo existe un asunto de competencia con efectos en todo el país, pero que tiene origen en la 
CSPFTZ, que autoridad tiene competencia para investigar el caso? ？  
 
Answer 
According to Measures for the Administration of China (Shanghai) Pilot Free Trade Zone, the 
Administration Committee of China (Shanghai) Pilot Free Trade Zone is responsible for 16 
administrative examination and approval items; the items whose authority of office resides in the state are subject to the examination and approval of relevant state authority.  
 
Políticas y Prácticas Comerciales por medidas 
 
Paragraph 3.4 
Have the Chinese government identified loopholes by enterprises obtaining incentives in the form 
of preferential tax treatment under the Enterprise Income Tax Law? What actions have related 
authorities carried out to prevent misusing ince ntive programs under the Enterprise Income Tax 
Law? Which are the industries or commercial acti vities that are excluded from the incentives 
granted under the Enterprise Income Tax Law? Can an enterprise simultaneously enjoy different benefits granted under the Enterprise Income Ta x Law, for instance a High and New Technology 
Enterprise with a reduced rate of 15% can at the same time enjoy incentives regarding R&D 
expenses?  
 
Paragraph 3.6 
What are the controls – programs – methodologies that the government has implemented to verify information companies have submitted trough the China E-port System complies with what they 
are actually trading?  
 Answer 
We're still in the process of consulting with the relevant authorities.  
 
Paragraph 3.101 and 3.102 Which are export subsidies China introduced during the period under review? Which are the 
programs and conditions enterprises should comply to benefit from them? How does China control 
export subsidies are not used for domestic sales? Are foreign enterprises granted access to those programs?  
 
Answer 
No export subsidy in China.  
Párrafo 3.32 
¿Podría explicar por qué razón las medidas normalmente expiran después de 10 años? En caso de que se trate del resultado de un análisis realizado por la autoridad, ¿podría indicar qué es lo que se 
analiza y qué criterios se aplican?  
 Answer 
Article 48 of Anti-dumping Regulations of the P.R.C stipulates that if a review determines that the 
termination of the anti-dumping duty may result in the continuation or recurrence of the dumping 
and injury, the time limit for the imposition of th e anti-dumping duty may reasonably be extended. 
With regard to the investigation factors and an alysis methods of sunset review, China bears 
similarity with many other WTO member states in  practices. In other words, China takes the WTO 
anti-dumping agreement and the stipulations of domestic laws as the essential basis.   
Párrafo 3.33 
¿Podría explicar de qué manera funcionan éstas reglas provisionales y en su caso, si se tiene previsto algún esquema para que dejen de serlo como por ejemplo, algún tiempo específico de 
vigencia o su integración a otra legislación?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
The provisional rules now in effect constitute an important part of China's legal system of trade 
remedy, providing specific guidance to the investigating authority on how to conduct investigations 
in accordance with law. China will constantly re vise and improve the corresponding stipulations 
based on practices.  
Párrafo 3.37 
¿El estándar aplicable a las iniciaciones de oficio es igual que el aplicable a las iniciaciones a petición de parte? Si no es así, ¿cuáles son las diferencias?   
Answer 
The Ministry of Commerce adopts the same criteria when reviewing an application or putting a 
case on initiate an investigation on its own, i.e.  whether there is sufficient evidence to prove that 
the existence of dumping, injury and causal link be tween the two. Up to now, since the Ministry of 
Commerce has not initiated an investigation without the application of the domestic industry.  
¿Las determinaciones finales publicada por el  MOFCOM, que imponen derechos antidumping, 
contienen todos los razonamientos de la autoridad, los fundamentos aplicables y la información en la que se basó, o por el contrario, sólo contiene un extracto de esos datos? En caso de que sólo contenga un extracto, ¿de qué forma pueden las partes tener acceso a los datos completos? 
 
Answer 
The final determination published by the Ministry of Commerce contains complete information on 
the reasons for levying anti-dumping duty and the basis for the applying the measure. 
 Párrafo 3.40 
¿Cuál es el procedimiento mediante el cual el MOFCOM revela los hechos esenciales? ¿Las partes 
tienen oportunidad, durante el procedimiento, de presentar argumentos al respecto? En caso afirmativo, ¿en qué consiste esa oportunidad?  
Answer 
Apart from the regulations on the trade remedy investigations, Ministry of Commerce also makes 
stipulations on the relevant procedures of investigations in its departmental rules . In addition, it 
also publishes major investigation procedures and the ways of contact in the public notice of each 
case. All interested parties have sufficient opportunities to put forward their views in the process of investigation. The ways of putting forward views in clude but are not limit to submitting answers to 
questionnaires, making comments on the materials submitted by other interested parties and the 
fact disclosure by the investigating authority, and participating in hearings. All interested parties should submit materials or views in the written form, and when it is necessary to keep the submission confidential, they should explain the reasons for keeping them confidential and provide 
adequate public version of the confidential information.  
 Entendemos que no existen reglas aplicables para  llevar a cabo un examen sobre interés público, 
pero ¿se lleva a cabo ese examen? De ser así, ¿podría explicar qué aspectos se toman en cuenta 
en la práctica y de qué forma se consideran?   
Answer 
According to Article 37 of the Anti-Dumping Regula tions, imposition of anti-dumping duty shall be 
in the public interest. In an anti-dumping inve stigation, Chinese investigation authority holds 
hearings and meetings to allow all interested parties, including manufacturers and exporters 
involved in the case, involved governments, up stream and downstream enterprises and related 
industry associations and importers, to express their views, and seriously considers their arguments, so as to ensure an objective, impa rtial and fair investigation. The investigation 
authority will review specific considerations case by case. 
 Párrafo 3.42  
¿Cuáles podrían ser las causas distintas al incump limiento del compromiso de precios, que podría 
considerar el MOFCOM para reactivar la investigación?  
 WT/TPR/M/300/Add.1 
 
- 127 - 
 
  
 Answer 
There is no stipulation on the reason of violating the price commitments in WTO regulations and 
China's laws and regulations. Nor is there stipulation on taking the reason of violating the price 
commitments into consideration when the investig ating authority reopens the investigation. WTO 
Members may take different factors into consideration in their practices. China has not yet had practices in this regard. 
 
¿Qué implicaciones tiene "terminar" la investigación? Si una investigación es "terminada", ¿podría reactivarse? ¿De qué forma?  
Answer 
The article 5.8 of Anti-dumping Agreement makes st ipulation on terminating investigation. So does 
the Anti-dumping Regulations of th e P.R.C. Termination mean that the investigation is put to an 
end, and will not be reopened. If an applicant makes an application for the second time, the case 
will be handled as a new one.   
Párrafo 3.43 
¿El cálculo del margen de dumping de los exportad ores y productores no incluidos en una muestra 
considera el promedio ponderado de los márgenes de los que sí están incluidos en la muestra, excluyendo únicamente a los márgenes de minimis  o iguales a cero? ¿No se excluyen los 
márgenes determinados conforme a los hechos de que se tenga conocimiento? 
 Answer 
For exporters and manufacturers who are not subjec t to individual examination, China determines 
the margin of dumping in accordance with the weighted average dumping margin of sampled exporters and manufacturers. According to Article 14 of the Provisional Rules on Sampling in 
Antidumping Investigations adopted by the Ministry of Commerce, the calculation of such weighted 
average dumping margin shall exclude: (1) zero dumping margin; (2) de minimis dumping margin as less than 2%; (3) dumping margin determined in accordance with Article 21 of the "Antidumping Regulation of the People's Republic of China". 
 
Párrafo 3.46 Quisiéramos saber si China tiene previsto realizar alguna reforma o modificación a su legislación 
interna, con el objeto de incorporar formalmente la manera en que ha manifestado que aplicará el 
artículo 56 a los Miembros de OMC.  
Answer 
At present China has no relevant plan. 
 Párrafo 3.47 
Observamos que, en el caso de las revisiones para nuevos exportadores, éstos deben haber 
exportado a China en volúmenes suficientes para poder considerarlos como base utilizable para determinar un precio de exportación. ¿Qué criterios se siguen para determinar si los volúmenes 
son suficientes o no?  
 Answer 
There is no specific stipulation in this regard in WTO Anti-dumping Agreement, and most members 
make judgments on a case-by-case basis. Article 5 of the Provisional Rules on the New Shipper Review issued by the Ministry of Commerce stipul ates that "The export mentioned in the preceding 
Paragraph of this Article shall be made in sufficient quantities so as to constitute the basis for 
determination of the ordinary export price. Such quantities shall be established on the basis of 
transaction volume under the normal commercial conditions of the product under investigation. ." As there may be huge differences in the transaction volume under the normal commercial 
conditions of various products, it is therefore necessary to judge whether the transaction volume is 
sufficient or not on a case-by-case basis.   
Párrafo 3.48 
¿Cuáles son las circunstancias que toma en cuenta el MOFCOM para iniciar una "interim review" de oficio?  WT/TPR/M/300/Add.1 
 
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 Párrafo 3.51 y Cuadro 3.4 
En la tabla 3.4 aparecen reportadas 114 medidas vigentes y en el párrafo 3.51 se señalan 113. ¿Cuál es la cifra correcta? 
 
Answer 
Please refer to the China's notification regarding ADP .  
 
Párrafo 3.55 ¿El MOFCOM realiza visitas de verificación a los Gobiernos y/o exportadores que son parte de las investigaciones en materia de subvenciones?  
 
Answer 
Yes, to verify the authenticity and accuracy of information, the Ministry of Commerce may conduct 
on-site verification on the government and /or ex porters of the exporting country (region) in the 
countervailing investigation.   
¿Existe alguna política especial de China en cuanto a permitir visitas de verificación en el marco de 
investigaciones en materia de subvenciones conducidas por cualquier otro Miembro de OMC?  Answer 
China conducts countervailing investigation in acco rding with the SCM Agreement. In this regard, 
there is no special policy.  
Párrafo 3.65  
¿Existe alguna medida o mecanismo para asegurar que los estándares y criterios técnicos no obstaculicen innecesariamente la competencia?  
 
Párrafo 3.80 ¿En dónde se puede consultar el Catálogo que se menciona en este párrafo? ¿Existe versión en inglés? 
 
Answer 
For the catalogue, please visit http://www.aqsiq.gov.cn. At present there is no official English 
translation. Catalogue of Imported Commodities Subject to the Safety and Quality Assurance 
System also stipulates the general standards on the highly sensitive commodities in terms of safety, hygiene and environmental protection. In addition, waste materials that may be used as 
raw materials must be subject to examination and inspection before they are loaded for 
exportation, so as to prevent the entry of harmfu l waste materials into the territory of China.  
 Párrafo 3.81 
En dónde se puede consultar el Catálogo que se  menciona en este párrafo? ¿Existe versión en 
inglés?  
Answer 
For the catalogue, please visit http://www.aqsiq.gov. cn. At present, there is no official English 
translation.  
 
Párrafo 3.84 ¿Existe una fuente en donde se puede encontrar las medidas impuestas, a las que se hacen referencia en este párrafo y que no se han reportado a la OMC?  
1. For quarantine and testing procedures for chum salmon, please visit 
 http://www.aqsiq.gov.cn/; 2. All food safety standards will be pub lished in the form of public notice at:  
 http://www.nhfpc.gov.cn/sps/s7891/list.shtml; http://bz.cfsa.net.cn/db; and for the testing 
 methods and standard texts of food additi ves, please visit http://bz.cfsa.net.cn/db. 
2. For importing conditions relevant to ph thalates, please visit http://www.aqsiq.gov.cn/; 
3. For restrictive measures imposed upon the impo rting of beef as a result of mad cow disease, 
 please visit http://www.aqsiq.gov.cn/; and http://www.moa.gov.cn.   WT/TPR/M/300/Add.1 
 
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 Párrafo 3.133 
¿La política de competencia considera labores de abogacía de la competencia?  En caso afirmativo, ¿Cuáles son las principales actividades y resultados? 
 
Answer 
Articles 55 and 56 stipulate the exceptions with respect to lawful conducts of exercising intellectual 
property rights, and the relevant economic conducts of agricultural producers and rural economic 
organizations. Except for the above-mentioned circumstances, the Anti-monopoly Law is applicable to all lines of trade. At present, there is no special stipulation to legal profession.   
Párrafo 3.142 
¿Los acuerdos horizontales son ilegales per se? ¿Para determinar si los acuerdos verticales son ilegales hacen uso del análisis de eficiencias o el uso de la regla de la razón? 
 
Answer 
Article 13 of China's Anti-Monopoly Law stipulates that "Business operators in competition with 
each other are prohibited from entering into any of the following monopoly agreements: (i) fixing 
or changing prices of goods;(ii) limiting the output or sales of the goods; (iii) dividing up the sales markets and/or the raw materials procurement markets; (iv) limiting the purchase of new technologies or new equipment, or limiting the development of new goods or new technologies; 
(v) jointly boycotting transactions; (vi) other monopoly agreements as determined by the anti-
monopoly enforcement authorities of the State Co uncil." These six types of monopoly agreements 
are horizontal monopoly agreements explicitly pr ohibited by Anti-monopoly Law. They constitute 
the most severe damages to market competition, and belong to the core cartels which are the 
focus of attack in the anti-monopoly efforts in all countries.   
According to Articles 13 and 15 of China's Anti-M onopoly Law, the principle of "forbidding in 
principle and exempting the exceptions" is applied to the six types of statutory horizontal monopoly agreements. In other words, the six types of horizontal monopoly agreements as stipulated in Article 13 violate the law in prin ciple. However, if business operators can, in 
accordance with Article 15, prove that the reac hed horizontal monopoly agreement belongs to 
research & development cartel, standardization or  specialization cartel, small and medium-sized 
enterprise cartel, public interests cartel, structural crisis cartel, exporting cartel, and can prove 
that the previous five types of cartel will not severely damage the competition in the relevant 
market and can make consumers share the interests thus produced, then the horizontal monopoly agreement may be exempted from being regarded as violating the law .  
 
¿Se ha clarificado el tipo de evidencia requerida para acreditar que un acuerdo es anticompetitivo, así como el tipo de prueba que un potencial infractor puede presentar en su favor para demostrar que no ha incurrido en ésta práctica?  
 
Answer 
It is necessary to prove that a horizontal monopoly agreement has the following constitutive 
elements: (1) element of main body, i.e. two or  more than two business operators competing 
against each other in the same line of business; (2) element of conduct: i.e. concluding agreements with respect to price, production or sales quantity, sales market or raw-material 
purchasing market, or coordinating in their decision or implementing on the above-mentioned 
issues; (3) element of result: i.e. the effect of eliminating or restricting competition is produced; 
(4) element of causal relation: i.e. there is causal relation between the conduct of business operators and the produced effect of damaging competition.  
 
It is necessary to prove that a vertical mono poly agreement has the following constitutive 
elements: (1) element of main body, i.e. ther e are two parties concerned, including business 
operators and trading counterparts; (2) element of conduct: i.e. business operators and their 
trading counterparts conclude agreements with respect to the prices of reselling commodities or services to a third party in a fixed way or with respect to the minimum prices of reselling 
commodities or services to a third party in a restrictive way; (3) element of result: i.e. the effect 
of eliminating or restricting competition is produced; (4) element of causal relation: i.e. there is causal relation between the conduct of business operators and their trading counterparts and the 
produced effect of da maging competition.  WT/TPR/M/300/Add.1 
 
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 If there is evidence proving the conduct suspecte d of involving monopoly does not have the above-
mentioned constitutive elements, or, although such a conduct has the relevant constitutive 
elements, it conforms to article 15 on exemption of monopoly agreement, it can be proved that 
the conduct suspected of involving monopoly is not a monopolistic conduct.  
 ¿Qué limitantes tiene la legislación en materia de competencia para sancionar cárteles 
internacionales que afecten sus mercados? ¿Qué di ficultades podría plantear que las empresas 
involucradas residan fuera de China y afecten los mercados chinos?   Answer 
According to the stipulations of China's Anti-monop oly Law, it is unlawful in principle for business 
operators to reach any horizontal or vertical mo nopoly agreement. However, article 15 of the law 
stipulates exemption circumstances. If busine ss operators can prove the monopoly agreement 
concluded is in consistent with any of the circumstances in article 15, such an agreement among 
business operators shall be exempted from being regarded as a law-violating conduct.   
All types of enterprises are equal in the sight of Anti-monopoly Law. The nationality of an 
enterprise will not be taken into consideration when legal responsibilities are investigated. Therefore, if international monopoly combines violates China's Anti-monopoly Law, it will be 
investigated for legal responsibilities as well in a ccordance with articles 46 and 47 of the law, and 
will be given penalties including being ordered by anti-monopoly authority to cease doing so, 
confiscation of illegal gains and imposition of fine s. There is no restriction in awarding penalty. 
Generally speaking, the National Developmen t and Reform Commission (NDRC) has been 
successful in imposing penalties upon foreign enterprises in its recent law-enforcement activities 
against price-fixing.  
¿Qué elementos son considerados para priorizar investigaciones? 
 Answer 
Article 38 of China's Anti-monopoly Law stipulates that, any entity or individual may report 
suspicious monopolistic conducts to the anti-monopoly authority. Where an informer makes the 
reporting in written form and provides relevant facts and evidences, the anti-monopoly authority 
shall make necessary investigation. The anti-mon opoly authority adopts statutory investigation 
measures in accordance with legal proceedings to investigate and obtain any kind of evidence that 
may prove the monopolistic conduct. The anti-monopoly authority will give priority in investigating the reported case that has bearing upon the immediate interests of people, social public interests 
and vital national interests.  
 ¿Existe algún procedimiento para determinar insumos esenciales?  
Answer 
Please see Anti-monopoly Law, Law on Administrative Penalty and the Provisions on the 
Administrative Procedures for Law Enforcement against Price Fixing promulgated and implemented 
by National Development and Reform Commission.  
 ¿Qué tipo de elementos, además de los menciona dos, se consideran como atenuantes/agravantes 
al imponer sanciones? 
 Answer 
According to Article 49 of China's Anti-monopoly Law, the specific amount of the fines shall be 
determined in consideration of such factors as the nature, extent and duration of the violations. 
There are other factors that may be taken into consideration when decision on giving mitigated or heavier penalty is made. These factors include on what degree law-violating party works in 
coordination with investigation efforts, if there is voluntary surrender or meritorious deed that 
deserves lenient treatment, if there is act of voluntarily eliminating or reducing the harmful 
consequence occasioned by illegal act, and if ther e is circumstance of being coerced or coercing 
others.  
 
Apart from the stipulations in the Anti-monopoly La w, article 27 of Law on Administrative Penalty 
also stipulates as follows: "A party shall be given a lighter or mitigated administrative penalty in WT/TPR/M/300/Add.1 
 
- 131 - 
 
  
 accordance with law, if: (1) he has taken the initiative to eliminate or lessen the harmful 
consequences occasioned by his illegal act; (2) he has been coerced by another to commit the illegal act; (3) he has performed meritorious deeds when working in coordination with 
administrative organs to investigate violations of law; or (4) he is under other circumstances for 
which he shall be given a lighter or mitigated admi nistrative penalty in accordance with law. Where 
a person commits a minor illegal act, promptly puts it right and causes no harmful consequences, 
no administrative penalty shall be imposed on him." 
 Párrafo 3.152  ¿Cómo es el procedimiento de notificación de concentraciones? ¿Qué criterio se utiliza, de acuerdo 
con la Ley, para determinar si una  fusión es aprobada/rechazada?  
 Answer 
Please refer to the Anti-monopoly Law and its implementing rules. Please consult at http://fldj.mofcom.gov.cn/.  
¿Se permite la fusión de operaciones potencialmente anticompetitivas bajo la excepción de la 
empresa en crisis ( failing firm defense )?, ¿Se ha implementado dicha excepción?  
 
Answer 
Please refer to the Anti-monopoly Law and its implementing rules. Please consult at 
http://fldj.mofcom.gov.cn/. 
 ¿Cómo es el procedimiento para investigar y condicionar/sancionar concentraciones internacionales con efectos anticompetitivos en China? ¿Qué ocurre cuando las empresas 
involucradas residen fuera de China y afectan los mercados chinos? 
 Answer 
Please refer to the Anti-monopoly Law and its implementing rules. Please consult at 
http://fldj.mofcom.gov.cn/. 
 Párrafo 3.154 
¿Se considera si existen eficiencias que compense n el efecto anticompetitivo de una fusión?  
 En caso afirmativo, ¿Qué tipo de evidencia se considera en la práctica para acreditar que los 
beneficios obtenidos de eventuales eficiencias económicas, producto de una integración económica 
determinada, efectivamente exceden el potencial impacto negativo de la operación?   Answer 
Please refer to the Anti-monopoly Law and its implementing rules. Please consult at http://fldj.mofcom.gov.cn/.  
Párrafo 3.157 
¿Qué mecanismos formales, e informales, se tienen para fomentar la cooperación, y soporte técnico con autoridades de competencia de otras jurisdicciones?  
 
Answer 
Please refer to the Anti-monopoly Law and its implementing rules. Please consult at http://fldj.mofcom.gov.cn/. 
 
¿Cómo podría mejorarse la cooperación internacional con otras agencias de competencia?  
Answer 
Please refer to the Anti-monopoly Law and its implementing rules. Please consult at 
http://fldj.mofcom.gov.cn/. 
 WT/TPR/M/300/Add.1 
 
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 Párrafo 3.165 
¿Se ha estimado cómo el mecanismo de control de precios descrito distorsiona la eficiencia de los mercados mencionados?   
Answer 
Since the initiation of reform and opening-up, China has always been making great efforts to 
promote price reform. At present, the control over  the prices of most commodities and services 
has been lifted; prices are subject to market adjustment; market efficiency has been greatly 
improved, and market prices play decisive roles in allocating resources. According to the  
arrangement of the third plenary session of the 18th Central Committee of the Communist Party of 
China, China will continue to improve the mechan ism whereby prices are mainly determined by 
market. Any price that can be determined by the market must be left to the market, and the 
government is not to carry out improper interven tions. Price control in competitive areas will be 
relaxed. At present, prices which are determin ed by the Government are limited to important 
public utilities, public-welfare services and ne twork-based natural monopolies. These prices are 
within the scope of China's WTO accession commitm ents, subject to social supervision, and the 
transparency on these prices has been constantly enhanced.   
 Párrafo 3.177 
¿Qué medidas se implementan para fomentar una competencia más eficaz en las compras públicas 
y reducir el riesgo de colusión en los procesos de adquisición?  
Answer 
For the purpose of improving the efficiency of government procurement, the Chinese Government 
is energetically promoting the application of information technology in government procurement, 
and adopting e-procurement step by step. Meanwhile, the Chinese Government actively promotes 
the standardization of government procurement, e nhances the transparency and step up efforts to 
handle the complaints and exercise supervision and inspection, so as to reduce the risk of collusion in the process of government procurement.  WT/TPR/M/300/Add.1 
 
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 PREGUNTAS ADICIONALES DE MEXICO 
Página 66, Párrafo 3.37 
In the case of initiations on behalf of the dome stic industry, petitions may be lodged with MOFCOM 
in writing, by natural or legal persons, or by any relevant organization, representing the domestic 
industry. Articles 13-15 of the anti-dumping regu lations specify that the petition shall have 
supporting evidence of the existence of dumping, of  injury caused to the domestic industry, and of 
the causal link between dumping and injury. MOFCOM  has 60 days from the date of receipt of a 
petition to decide whether to initiate an investigation. To self-initiate an anti-dumping investigation, MOFCOM must have sufficient eviden ce of the existence of dumping, of injury, and 
of a causal link. MOFCOM is responsible for determining the existence of dumping, injury, and 
causation, and the State Council Tariff Commission  (SCTC), the coordination body of the State 
Council, makes the final decision as to whether to impose anti-dumping duties based upon a proposal by MOFCOM. This proposal is not a public document; a determination is published by 
MOFCOM after the SCTC has made its decision.  
 En el párrafo China señala que para iniciar una investigación antidumping, el Ministerio de 
Comercio debe tener evidencia suficiente de la existencia del dumping, del daño y de la relación 
causal ¿Puede aclarar China a qué le llama evidencia suficiente y si la misma se da a conocer, en todo o en parte, en la publicación de inicio de investigación del Ministerio de Comercio?   
Answer 
When considering an application for AD invest igation, MOFCOM will examine the adequacy and 
accuracy of the evidence submi tted by the applicant. On the dumping side, evidence on normal 
value, export price and price comparability will be examined. On the injury side, evidence on the 
volume and price of the dumped imports, the effect  on the domestic industry and the situation of 
the domestic industry will be examined. On the causal link, non-attribution analysis will be 
conducted. Only when MOFCOM is satisfied with the adequacy and accuracy  of the evidence, an 
investigation can be initiated. Such evidence should  be limited to what can be reasonable acquired 
by the applicant. The MOFCOM Announcement on initiation will demonstrate such examinations 
and interested parties can have access to the ap plication and evidence submitted by the applicant 
in the Public Reading Room. 
 ¿Quiénes constituyen la Comisión del Consejo de Estado sobre Clasificaciones y cómo opera el 
proceso de decisión para validar el inicio de una investigación antidumping?  
 Answer 
For details, please refer to the Anti-Dumping Regulations.  Página 67, Párrafo 3.39 On the basis of its findings, MOFCOM must make and publish a preliminary determination on 
dumping and injury, as well as on whether there exists a causal link between dumping and injury. 
If a preliminary determination is affirmative, provisional anti-dumping measures may be applied, after at least 60 days from the date of publication of the decision to initiate the investigation. 
Provisional measures may take the form of provisional anti-dumping duties, or a request to 
provide deposits, bonds, or other forms of guarantees. In the latter case, the decision is made by MOFCOM. The decision to apply provisional anti-d umping duties is made by the SCTC on the 
recommendation of MOFCOM. Provisional measures may not generally be applied for more than 
four months, but may be extended to nine months in "special circumstances", this being understood to refer to those cases where the authorities are examining whether a duty lower than the margin of dumping would be sufficient to remove the injury to the domestic industry.  
 
¿Puede China dar mayor claridad al término "circunstancias especiales", los criterios para calificarla y si estos son dados a conocer en la resolución preliminar por la que impone derechos 
antidumping?  WT/TPR/M/300/Add.1 
 
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 Answer 
The wording of "special circumstances" intends to cover the circumstances not yet encountered but 
may emerge in the future. Such circumstances will be assessed and judged on a case-by-case 
basis. 
 Página 67, Párrafo 3.40 
Whether or not provisional measures are applied, in the case of an affirmative determination 
MOFCOM must continue the investigation and, on the basis of its findings, make a final determination which must be published. Before the final determination is made, MOFCOM must inform all known interested parties of the essential facts on which the final determination is based. 
The investigation must be completed within 12 months of the date on which the decision to initiate 
is announced, or within 18 months under special circumstances. In accordance with the anti-dumping regulations, the imposition of anti-dum ping duties must be in the public interest. 
However, there are no rules specifying how to do this and, with the exception of price 
undertakings, the issue has not been explicitly included as a factor for considering whether to impose a measure or not.  
 
¿Puede servirse China aclarar los motivos por los cuales no puede dar a conocer las reglas para la imposición de derechos antidumping con base al interés público y el mecanismo regulatorio para incluirlas en la determinación final sin ser explícitos en dicha obligación?  
 
Answer 
Article 37 of China's AD Regulations provides that  the collection of anti-dumping duty should 
conform to the public interest and the investigatin g authority is guided by this principle in the 
investigations and determinations. The full text of China's AD Regulations has been notified to the WTO. So far there are no dedicated procedures for public interest investigations in China's laws 
and regulations. However, in anti-dumping inve stigations, the investigating authority will hold 
public hearings and opinion statement meetings among others to provide adequate opportunities for all parties, including involved producers an d exporters, the government of the involved 
country, upstream and downstream enterprises, relevant trade associations as well as importers, 
to listen to their opinions, and seriously take thei r relevant appeals into account so as to ensure 
objective, impartial and equitable investigations. The investigating authority will make recommendations on whether to impose anti-dumping duties in accordance with the AD 
Regulations. The final determinations are amplified with arguments and comments submitted by 
all interested parties. All examinations, explanat ions, assessments and clarifications made by the 
investigating authority reflect its appropriate consider ations of the public interest in terms of both 
procedures and substance. 
 Página 68, Párrafo 3.46 Article 56 of the anti-dumping regulations allows the authorities to take corresponding measures 
when a trading partner ''discriminatorily'' imposes anti-dumping measures on exports from China. 
However, the authorities reiterated during the current review that China has not applied Article 56, and that before taking corresponding measures in  respect of a WTO Member China would resort to 
the relevant WTO dispute settlement provisions.  
 China ha notificado que no aplica la retaliación del artículo 56 sin antes haber analizado las 
disposiciones de la OMC en materia de solución de controversias, no obstante, ¿China tiene 
previsto eliminar la citada disposición con el ob jeto de brindar mayor seguridad a los países que 
comercian con base en las reglas de libre mercado de la OMC? ¿Podría explicar el procedimiento en caso de que decida aplicar esta medida de retaliación? 
 
Answer 
China does not have any plan of modifying the AD Regulations at this moment. China has never 
applied any "retaliatory" AD measures before and will not do so to any other WTO Members in the 
future. China has already clarified that before ta king "corresponding measures" in respect of a 
WTO Member, China would resort to the relevant WTO dispute settlement provisions. 
 WT/TPR/M/300/Add.1 
 
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 Página 73, Párrafo 3.68 
The authorities noted that there has been no substantial change in the procedures to formulate standards, both voluntary and "mandatory" standards (as technical regulations are referred to in 
China), since the last Review. National standards are formulated by SAC, through an eight-step 
process: feasibility study, research, project de sign, drafting of proposed standard, comments, 
examination, approval and publication. National  standards are reviewed after five years of 
implementation and might be amended or annulle d as required. Industry/sectoral standards are 
formulated by the standardization administrations of the competent ministries, with the support of the industry institutes of standardization and technical committees. National and industry/sectoral standards must be published in the Standard Press of China, and filed and stored at the National 
Library of Standards. Local standards are formulat ed by departments of standardization authorities 
of provinces, autonomous regions and municipali ties directly under the Central Government in 
accordance with the Administrative Measures on Local Standards.  
 
China señala que tiene 8 etapas en el proceso de  adopción de una "regulación técnica" ¿Puede 
explicar de forma detallada el proceso de comentarios?¿Este procedimiento es el mismo en la 
elaboración de regulaciones técnicas locales?  
 ¿Se publica el resultado del proceso de examen de comentarios y cuál es el medio de publicación?   
Joint Answer 
In accordance with the Administrative Measures on National Standards, SAC shall print and 
distribute drafts of standards for soliciting publ ic opinions from main entities of production, 
distribution, usage, R&D and inspection as well as universities and colleges. It will take 2 months. 
The organization in charge of formulating the standards shall summarize, arrange, analyze and research the solicited opinions and then produce such materials as the drafts of national standards 
for approval and the list of opinions summaries. The Secretariat of SAC or the relevant responsible 
technical department shall review such materials and determine whether to submit the same for examination. Local standards are formulated in a ccordance with the Administrative Measures on 
Local Standards which are basically the same as the Administrative Measures on National 
Standards. 
 Página 77, Párrafo 3.80 
Inspection procedures for imports and exports subject to SPS measures have not undergone any 
changes since 2010. All imports and exports listed under the Catalogue must be presented to the 
entry and exit inspection and quarantine authoritie s. If the goods subject to statutory inspection 
have not been inspected, they are not allowed to be sold or used in the Chinese territory. 
Regarding imports, the Catalogue contained 2,032 tariff lines at the HS 8-digit level in 2013. The last amendment, which took place on 1 August 2013, added two tariff lines (lignite (whether or not pulverized, but not agglomerated) (HS 27021000)  and agglomerated lignite (HS 27022000)) to 
the list of imports that are subject to inspection  and quarantine requirements. Some 80% of the 
goods subject to automatic import licensing are also subject to inspection and quarantine and 
some 35% of goods subject to non-automatic lic ensing were also subject to inspection and 
quarantine.  
 Sobre la aplicación de los procedimientos de inspección en los productos contenidos en el Catálogo 
se han recibido argumentos de los gobiernos locales, donde señalan que pueden "adecuar" los 
procedimientos de inspección de acuerdo a sus necesidades ¿Puede China explicar si dichos 
procedimientos son públicos, la disposición legal que los contiene y si existe un discreción de los gobiernos locales de establecer sus propios procedimientos o interpretarlos?  
 
Answer 
The inspection procedures regarding lignite are subject to the Administrative Measures for 
Inspection of Exported Coal (Decree No. 9 of the AQSIQ) which are available for review on the 
website of the AQSIQ and the Technical Specifications for Control and Supervision on Extraneous Impurity in Coal for Import and Export (SN 1549-2011) which may be purchased in the market. 
Lignite is the commodity subject to statutory inspection. Local governments shall not change the 
inspection procedures of lignite at will.  WT/TPR/M/300/Add.1 
 
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 2.16 RÉGIMEN DE COMERCIO E INVERS IÓN/Marco de política comercial y 
objetivos/Marco Institucional  
El párrafo señala que las quejas de las empresas con inversión extranjera son manejadas por la 
Oficina de Coordinación de Quejas para Empresas con Inversión Extranjera y el Centro Nacional de Denuncia para las Empresas con Inversión Extranjera, ambos a cargo del Ministerio de Comercio 
(MOFCOM). Se especifica que los datos sobre las quejas de tales empresas no están disponibles, 
sin embargo nos gustaría saber si el tipo de qu ejas que pueden realizarse también incluyen las 
relacionadas con los Acuerdos Internacionales de Inversión, particularmente sobre la solución de controversias internacionales entre un inversionista extranjero y el Gobierno de China, en caso 
negativo nos gustaría conocer cuál es la autoridad competente para recibir consultas y/o quejas en 
esta cuestión.   
Answer 
For details, please see website of  MOFCOM (http://www.mofcom.gov.cn). 
 
2.2.2 RÉGIMEN DE COMERCIO E INVERS IÓN/Marco de política comercial y 
objetivos/Objetivos de política comercial  En relación con la reforma de la política comercial y los cambios previstos para el régimen de 
inversión (interna y externa) se comenta que China busca tener un régimen más abierto, 
transparente y previsible. México desea saber si en dicha reforma se prevén incentivos a la IED, como los que se describen en el informe de Gobierno en el apartado 2.5.3. 
 
Answer 
Currently, China is actively promoting the institutio nal reform of foreign investment administration, 
researching the ways to fully amend the laws on  foreign investment, informing the legal systems 
on domestic investment and foreign investment, i nnovating the foreign investment administrative 
mode and exploring the administrative mode of pre-establishment national treatment and negative list on foreign investment. Such reforms are not the reforms on measures specific for encouraging 
foreign investment. At present, China shall continue to implement such measures for encourage 
foreign investment in accordance with the existing relevant laws and regulations. 
 
Se solicita a China responder a las siguientes preguntas formuladas con base en lo señalado en el 
informe de la Secretaría de la OMC WT/TPR/S/300 del 27 de mayo de 2014.  
2.56 RÉGIMEN DE COMERCIO E IN VERSIÓN/Régimen de Inversión 
Extranjera/Procedimientos de examen y aprobación/ Inversión extranjera  Sobre la aprobación de proyectos de IED en sectores de servicios nos gustaría conocer si existen 
criterios previstos en alguna regulación para ello.  
 Answer 
Currently, China has established a relatively sound  legal and policy system on foreign investment 
in the service sector. While investing in the service sector, foreign investors must comply with the Catalogue for the Guidance of Foreign Investment Industries and the applicable rules on foreign 
investment in financial, telecommunication and tran sportation sectors. Such rules have explicitly 
provided for the procedures and principles for foreign investors to invest in the service sector. Foreign investors may enquire about such information through public channels.  
4.2.1.2.5 POLÍTICAS COMERCIALES PO R SECTOR/Servicios/Servicios de 
Telecomunicaciones/Servicio Universal  
 
Además de los servicios de telefonía y banda ancha, ¿existen otros servicios que se consideren o 
puedan considerarse servicios universales?  ¿La ordenanza de telecomunicaciones permite que empresas extranjeras puedan proveer servicios 
universales y en su caso también son consideradas para recibir un subsidio anual por 
compensación de los gastos mencionados?  WT/TPR/M/300/Add.1 
 
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 Answer 
In accordance with the Telecommunication Regulations, telecommunication operators must 
perform the corresponding universal service obligation s as stipulated by the State. As long as they 
satisfy the relevant conditions and requirements, the telecommunication operators legally 
incorporated in China may provide universal services. Competent authorities may consider granting certain support for facilitating operation and maintaining the facility to the companies, 
which have completed the designated universal services. 
 4.2.3.1 SERVICIOS/Servicios de Arquitectura  y Construcción/Servicios de Arquitectura 
 
Dadas las tendencias de crecimiento en el mercado de la Arquitectura y la demanda de estos 
servicios en China: ¿Se prevé tener un mecanismo de revisión para ampliar las actividades que pueden ejercer 
profesionalmente los arquitectos extranjeros en China?  
 Answer 
Foreign enterprises shall comply with the Interim Regulations on Administration over Foreign Enterprises Engaging in Architectural Construction  and Design in the People's Republic of China 
(Jian Shi [2004] No. 78) and other applicable laws and regulations and provide architecture services to the extent permitted by laws and regulations. 
 WT/TPR/M/300/Add.1 
 
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 15  QUESTIONS BY TURKEY 
GOVERNMENT REPORT  
 
1. Introduction, (1.2) 
 It is mentioned in the report that "While continuing to implement the strategy of "Going Global", 
China proposed the vision of "Silk Road Econom ic Belt" and "Maritime Silk Road" and opened 
inland and border areas wider to the outside world with a view to forming a new pattern of all-round opening up."   
Question 
Could China kindly provide specific details about the "Silk Road Economic Belt" and "Maritime Silk Road". 
 
Answer 
The "Silk Road Economic Belt" and "Maritime Silk  Road" are beautiful visions of driving great 
regional development by great regional cooperation and mainly include policy communication, road 
connection, trade passage, currency circulation and people exchange. The "Silk Road Economic Belt" and "Maritime Silk Road" are economic cooperation belts characterized by openness, 
inclusiveness, concerted consultation and establishment, win-win result and sharing and welcome 
willing countries and economies to become suppo rters, constructors and beneficiaries. We 
sincerely hope all countries and parties concerned will build consensus and take interests and concerns of all parties into consideration, make brainstorming to pool the wisdom and creativity of 
all parties and give full play to their advantages and potentials. We will implement a group of 
significant cooperation projects featuring consensu s, foundation, great influence and strong driving 
force according to development situations of all parties and facilitate orderly free factory flow, 
high-efficiency resource allocation and in-depth ma rket integration in the region. In addition, we 
will deeply tap the potential of trade growth to op timize foreign trade structure, strike a balance 
between the strategy of "Going Global" and the strategy of "Attracting Foreign Investment" to 
expand bilateral investment cooperation and facilitate international passageway construction to 
promote mutual linkage and connection of infrastructures. We are ready to build free trade 
relations with countries and regions along the economic belt and create better conditions for deepening economic and trade cooperation.  
 
2.1.2 Domestic economic situation, (2.7)  
In heading 2.7, some information is given about the adjustment of minimum wage standards in 
Chinese provinces.   Question 
To be able to make a comparison, could China kindly provide detailed information about the 
minimum wages in all provinces?  
Answer 
Monthly minimum wages in various regions across China, 2014 
(Unit: Yuan) 
Region Enforcement date Monthly minimum wages 
  First 
grade Second 
grade Third 
grade Fourth 
grade Fifth 
grade 
Beijing 2014.04.01 1,560      
Tianjin 2014.04.01 1,680      
Hebei 2012.12.01 1,320  1,260  1,150 1,040  
Shanxi 2014.04.10 1,450  1,350  1,250 1,150  
Inner Mongolia 2013.10.01 1,350  1,250  1,150 1,050  
Liaoning 2013.07.01 1,300  1,050  900   
Jilin 2013.07.01 1,320  1,220  1,120   
Heilongjiang 2012.12.01 1,160  1,050  900 850  
Shanghai 2014.04.01 1,820      WT/TPR/M/300/Add.1 
 
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 Region Enforcement date Monthly minimum wages 
  First 
grade Second 
grade Third 
grade Fourth 
grade Fifth 
grade 
Jiangsu 2013.07.01 1,480  1,280  1,100   
Zhejiang 2013.01.01 1,470  1,310  1,200 1,080  
Anhui 2013.07.01 1,260  1,040  930 860  
Fujian 2013.08.01 1,320  1,170  1,050 950  
Jiangxi 2013.04.01 1,230  1,150  1,070 980 900 
Shandong 2014.03.01 1,500  1,350  1,200   
Henan 2013.01.01 1,240  1,100  960   
Hubei 2013.09.01 1,300  1,020  900   
Hunan 2013.12.01 1,265  1,145  1,035 945  
Guandong 2013.05.01 1,550  1,310  1,130 1,010  
In which: 
Shenzhen 2014.02.01 1,808      
Guangxi 2013.02.07 1,200  1,045  936 830  
Hainan 2013.12.01 1,120  1,020  970   
Chongqing 2014.01.01 1,150  1,150     
Sichuan 2013.07.01 1,140  1,140  1,070 1,000  
Guizhou 2013.01.01 950  950 850   
Yunnan 2014.05.01 1,270  1,270  1,070   
Tibet 2012.09.01 1,150  1,150     
Shaanxi 2014.02.01 1,170  1,170  1,060 970  
Gansu 2014.04.01 1,300  1,300  1,250 1,200  
Qinghai 2012.12.01 1,060  1,060  1,050   
Ningxia 2013.05.01 1,220  1,220  1,150   
Xinjiang 2013.06.01 1,320  1,320  1,240 1,160  
Note: Bold figures are data adjusted since 2014. 
Hourly minimum wages in various regions across China, 2014 
Region Enforcement date Hourly minimum wages 
  First 
Grade Second 
Grade Third 
Grade Fourth 
Grade Fifth 
Grade 
Beijing 2014.04.01 16.9      
Tianjin 2014.04.01 16.8     
Hebei 2012.12.01 13  12 11 10  
Shanxi  2014.04.10 16 15 14 13  
Inner Mongolia 2013.10.01 11.4  10.6 9.7 8.9  
Liaoning 2013.07.01 13 9.8 8.6   
Jilin 2013.07.01 11.5  10.5 9.5   
Heilongjiang 2012.12.01 11 9 8.5 8  
Shanghai 2014.04.01 17      
Jiangsu 2013.07.01 13 11 9.5   
Zhejiang 2013.01.01 12  10.7 9.7 8.7  
Anhui 2013.07.01 13 11 10 9  
Fujian 2013.08.01 14  12.4 11.1 10.1  
Jiangxi 2013.04.01 12.3 11.5 10.7 9.8 9 
Shandong 2014.03.01 15  13.5 12   
Henan 2013.01.01 11.7 10.4 9   
Hubei 2013.09.01 14  11 9.5   
Hunan 2013.12.01 12.5 10.9 10.4 9.8  
Guangdong 2013.05.01 15  12.5 11.1 10  
In which: 
Shenzhen 2014.02.01 16.5     
Guangxi 2013.02.07 10.5  9.5 8.5 7.5  
Hainan 2013.12.01 9.9 9 8.6   
Chongqing 2014.01.01 12.5  11.5    
Sichuan 2013.07.01 12.6 12.1 11.1 10.4  
Guizhou 2013.01.01 11  10 9   WT/TPR/M/300/Add.1 
 
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 Region Enforcement date Hourly minimum wages 
  First 
Grade Second 
Grade Third 
Grade Fourth 
Grade Fifth 
Grade 
Yunnan 2014.05.01 12 11    
Tibet 2012.09.01 11      
Shaanxi 2014.02.01 13.7 13.3 12.7 12.2  
Gansu 2014.04.01 12.7  12.1 11.4 10.8  
Qinghai 2012.12.01 10.8 10.7 10.6   
Ningxia 2013.05.01 12.5  11.5 10.5   
Xinjiang 2013.06.01 15.2 13.2 12.4 11.6  
Note: Highlighted figures are data adjusted since 2014. 
2.3.1 Adhering to expanding dome stic demand, pg. 7, para. 2.16 
 It is stated in the Government Report that, "The Chinese Government takes promoting 
consumption, particularly the household consumption, as the focal point in expanding domestic 
demand. From March 2009 to January 2013, it implemented direct consumption stimulus programmes nationwide such as programmes for rural residents to purchase home appliances and 
motor vehicles and motorbikes, for people to trade in old motor vehicles and home appliances for 
new ones."   
Questions 
Could China kindly provide further information about the above mentioned programmes? Are there any differences among sectors in terms of incentives under these programmes?  
Answer 
Regarding consumption expansion, China implemen ted structural tax reduction policies, launched 
reforms on value-added tax for consumption, raised the wage deduction standard of individual 
income tax, cut by half enterprise income tax le vied on small low-profit businesses and expanded 
policy coverage, and raised the threshold of valu e-added tax and business tax. In addition, China 
cancelled, stopped, reduced and exempted many administrative charges to reduce burdens on 
enterprises and residents. Moreover, we increased income of low-income residents and facilitated 
expansion of consumption demand. China increased subsidies granted to farmers, substantially boosted minimum grain purchase price, raised the standards of urban and rural subsistence allowance and basic pension of enterprise retirees for many times, improved wage and public 
servant allowance and subsidy systems and implemented direct consumption stimulus 
programmes such as programmes for rural reside nts to purchase home appliances and motor 
vehicles and motorbikes, for people to trade in old motor vehicles and home appliances for new 
ones. Furthermore, China adjusted and optimized the expenditure structure, accelerated and 
facilitated the construction of social security system, implemented more proactive employment policy and deepened medical and health system reform.  
 
For details, please refer to Item 84 of China Subsidy Notification G/SCM/N/155/CHN and G/SCM/N/186/CHN for details of programme for people to trade in old motor vehicles for new ones. China will update information of corresponding projects in next subsidy report.  
 
2.3.2 Accelerating the development of the service sector, pg. 8, para. 2.24 
 
It is stated in the Government Report that, "In December 2012, the Chinese Government 
formulated the "Twelfth Five Year Plan" on the de velopment of the service sector and proposed the 
goals of increasing the proportion of the servic e sector, improving the standard of the service 
sector, pushing forward the reform and opening up  in the sector, and enhancing its capacity of 
creating jobs and attracting employment."   Questions 
How would China plan to satisfy its goals mentioned above? Is there any specific/concrete 
implementation or is there any roadmap on subsectors on achieving these goals?   WT/TPR/M/300/Add.1 
 
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 Answer 
As stated in the Twelfth Five Year Plan on the Development of the Service Sector, by 2015, the 
proportion of value added of the service sector  in GDP will increase by four percent points  
compared with 2010 (average annual increase rate  of 0.8 percentage points), being the highest 
among tertiary industries; and the proportion of  employments engaged in the service sector in 
total social employees nationwide will rise by fo ur percent points (average annual growth rate of 
0.8 percentage points) compared with 2010. However, the Plan is not a guiding catalogue but an 
overall blueprint for the development of the Chin ese service sector. All goals in the Plan are 
anticipatory. The Chinese Government has proposed no specific roadmap on or granted no special 
policy supports to subsectors.  
 
Since the implementation of the Twelfth Five Ye ar Plan, the Chinese Government has successively 
promulgated guiding opinions on the development of health, household, pension, cultural creativity 
and other life service industries, promoted the de velopment of key and weak links of production 
service sector, further deepened reform and open ing up, relaxed control over market access and 
facilitated industrial structural adjustment and upgrading.  
 
3.1.1 Trade development, pg. 16, para. 3.7  It is stated in the Government Report that, "In addition, China's trade partners became more 
diversified. The imports and exports with its three traditional major trade partners including the 
United States, the European Union and Japan retain ed growth but their shares have been falling. 
The trade with the ASEAN and other emerging mark ets maintained fairly faster growth trend."  
 
Question  
Could China please specify whether any country diversification strategy is being implemented to 
enhance the trade with ASEAN and other emerging markets?  
 Answer 
China has actively implemented market diversificat ion strategy and vigorously developed emerging 
markets in recent years. In 2013, the United States, the European Union and Japan combined 
accounted for 33.5% of China's total foreign trade volume, a decrease of 1.7 percentage points compared with 2012. In general, China maintained  rapid export growth to emerging economies, 
including export growth of 10.9% and 8.6% to  the ASEAN and South Africa respectively.  
 3.1.1 Trade development, (3.8)  
 
In heading 3.8, information is given about the export and import statics of private enterprises in China.  
Question  
Could China kindly provide information about the export and import statics of state enterprises?  
Answer 
Chinese Customs releases the export and import st atics of state enterprises in import and export 
statics published on a monthly basis.  
In 2012, export value of SOEs stood at US$256.3 billion, a decrease of 4.1% and 12 percentage 
points lower than overall export growth rate, an d their import value amounted to US$495.4 billion, 
an increase of 0.3% and 4 percentage points lo wer than overall import growth rate. In 2013, 
export value of SOEs reached US$249 billion, de creasing by 2.8% and 10.7 percentage points 
lower than overall export growth rate, and their import value registered US$499 billion, increasing 
by 0.6% and 6.7 percentage points lower than overall import growth rate (Sources: Monthly 
Statistical Reports of China Customs dated of December 2012 and December 2013).  
 
3.2.2 Accelerating the transformation of foreign-trade development patterns, (3.25) 
 
It is stated in the report that "China advanced the strategy of "win by good quality" and further 
imposed more requirements on quality and safety  of exported goods. The Chinese Government 
actively carried out relevant activities such as the "Year of Enhancing Goods Quality in Foreign Trade" and the special campaigns to crack down on the counterfeit and fake goods and products WT/TPR/M/300/Add.1 
 
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 with infringement of intellectual property rights exported to Africa so as to enable the enterprises 
to focus on the quality of their products, and thus improve the quality of goods."  As notified before to Chinese side during our bilateral meetings, Turkish firms complain about the 
fake and unmerchantable goods which are imported from China. In the process of solving these 
problems, firms and our missions in China are faced several difficulties.   
Question 
Could China provide its views on ways of cooperation with its trading partners in order to minimize such incidences?   
Answer 
China Customs has always strictly cracked down on exported goods with infringement of 
intellectual property rights and actively initiated international cooperation on cracking down on 
cross-border infringement. In June 2013, China and Turkey Customs discussed cooperation on 
intellectual property right in their meeting. China is ready to sincerely cooperate with Turkish side to crack down infringement of intellectual property right.  
 
When cracking down on the prohibited goods fo r export and the counterfeit and fake goods and 
products with infringement of intellectual proper ty rights, the Chinese Government has responsibly 
adopted a series of positive measures. We have strengthened inspection and quarantine of 
exported goods, actively launched campaigns of customs intellectual property right protection, 
intensified effort in application of risk analysis technology and investment in technological check device, consolidated surveillance and investigation on industrial and regional risk clues, and have 
strictly investigated goods that are suspected of  infringing upon intellectual property rights 
registered at the customs. In addition, China has sorted and rectified collecting and distributing centers of exported goods to promote quality improvement of regional products, and has launched 
cross-border cooperation to join hands with countries concerned to crack down infringement of 
intellectual property rights, counterfeit and fake good and illegal criminal activities.  
 Next, China will extensively launch cross-border cooperation and work with trader partners 
including Turkey to jointly crack down on illegal criminal activities according to relevant clues and 
requirements of countries concerned.   
SECRETARIAT REPORT 
 
1.1.1 Real Economy, pg. 14, para. 1.5  
 
It is mentioned in the Secretariat Report that "In the context of the current Review, the authorities 
noted that, to narrow the investment-consumption imbalance, the Chinese Government has continued to promote consumption expansion through specific programmes, such as sales of home 
appliances, vehicles and motorcycles in the countryside. These programmes, in place since 2009, 
and which the authorities consider to be important measures to improve people's livelihood and stimulate consumption, were scheduled to be terminated by 31 January 2013, but were rolled over 
for another year, until 31 January 2014, when they were concluded."   
 1.2.4 Outlook, pg. 33, para. 1.55  
As stated in the Secretariat Report, "The authorities consider that economic growth will continue to 
hinge on strong domestic demand, gi ven a stable external environment."   
 Questions 
Could China kindly give specific information about the tangible effect of domestic demand over the 
economic growth? Could China please comment on whether these consumption stimulus programmes make enough/expected contribution to stir up domestic consumption and also to the 
share of consumption in Real GDP shown in Tabl e 1.1 on page 14 considering the statement in 
Outlook part? On the other hand, how did China decide to extend these programmes for another 
year in 2013? Were there any specific indicators in deciding extension? If yes, please specify them.  
 WT/TPR/M/300/Add.1 
 
- 143 - 
 
  
 Answer 
The Chinese Government has regarded expandin g domestic demand particularly consumer 
demand as essential to China's long-term and sound economic development. In the past three 
years, domestic demand contributed over 100% to China's economic growth, making positive 
contributions to global economic growth and re-balance. In regard to expanding domestic demand, first of all, China has adopted comprehensive meas ures to strengthen residents' spending power. 
We have implemented proactive employment po licies, including vigorously develop service 
industries, SMEs and private economy with high employment capacity, improve employment and entrepreneurship support policies, strengthen vocational skill training and increase public-welfare service jobs.  
 
Moreover, we have deepened reform on income distribution system and promoted continuous income increase of farmers and low- and middle-i ncome urban residents by improving agricultural 
subsidy policies and keeping up-regulating minimum wage standard and pension for  retired 
workers and raising the threshold of individual income tax. We have improved social security system and accelerated the construction of basi c medical and endowment systems covering both 
urban and rural areas as well as urban government-subsidized housing projects.  
 Second, China has actively cultivated new consumption growth points. In Answer to the trend of resident consumption structure upgrading, we have focused on strengthening infrastructure 
construction, relaxed control over market access and improved fiscal, tax and financial support 
policies targeting at hot consumption sectors su ch as housing, automobile and environment-
friendly products as well as service consumption sectors such as tourism, information, culture, 
nursing home, health and educational training.  
 Third, China has focused on fostering a favorable consumption environment. We have vigorously 
developed urban and rural commerce and trade and logistics infrastructure networks, improved e-
commerce payment and security guarantee system, a ccelerated the establishment of social credit 
system and credit punishment mechanism, enhanc ed supervision on product quality and food and 
drug quality safety, intensified effort in punishing illegal infringements upon consumers' rights and 
interests and endeavoured to foster an environment for secure and reassuring consumption.  
 Along with constant effects in consumption expansion policy, the contribution of final consumption 
to economic growth has been on a significant ri se and has maintained above 50% over the past 
years. In the first quarter of 2014, final consumption drove by 5.7% points and contributed 76.7% to economic growth. 
 
2.1 Institutional and legal framework, (2.16)  It is stated in the report that "complaints from foreign-invested enterprises are handled by the 
Complaint Coordination Office for Foreign-invested  Enterprises and the National Complaint Centre 
for Foreign-invested Enterprises, both under MOFCOM."   
Question 
Does China consider establishing a similar mechanism to handle complaints of foreign companies related to trade? 
 
Answer 
MOFCOM set up the Overseas Business Complain t Service Centre for Chinese Enterprises in 
August 2006 which offers enterprises consulting  and accepts complaints about overseas unfair 
treatment of Chinese enterprises.  
 2.2.2 Trade policy objectives, (2.20) 
 
It was mentioned that "… in November 2013 approved a Decision on Major Issues Concerning Comprehensively Deepening Reforms. …In addition, during the session it was decided to set up a 
monitoring system to promote ecological progre ss and fight environmental pollution and improve 
the use of natural resources".   WT/TPR/M/300/Add.1 
 
- 144 - 
 
  
 Question 
As environmental depredations pose a serious threat to China's economic growth, costing the country roughly 9% (PDF) of its gross national income, according to most recent figures from the 
World Bank, could you kindly give examples of the practical steps that were taken since November 
2013 to monitor the ecologic progress?  
Answer 
The Chinese Government has attached great importance to ecological environment and adopted a 
series of measures to advance improvement in ecological environment. In April 2014, China promulgated the newly-revised Environmental Protection Law which will come into force on 
1 January 2015. In September 2013, the State Counc il printed and distributed the Action Plan for 
Air Pollution Prevention and Control and proposed specific indicator requirements and policy measures in 10 aspects for improving air quality nationwide. In May 2014, the General Office of 
the State Council printed and distributed the Implementation Scheme of Action Plan for Energy 
Conservation, Emission Reduction and Low-carbon Development 2014-2015 and proposed 30 measures in eight aspects.  
 
At present, the NDRC and the Ministry of Enviro nmental Protection have been implementing the 
Action Plan for Air Pollution Prevention and Control and the Implementation Scheme of Action Plan for Energy Conservation, Emission Reduction and Low-carbon Development 2014-2015.  
Departments and local governments concerned have established joint control and prevention 
working mechanism and adopted effective measures to advance air pollution control. In addition, 
China has also intensified effort in water and land pollution prevention and control.   
 
3.1.1 Customs procedures and requirements, (3.2)   
It is stated in the report that "Importers (and exporters) must register as foreign trade operators 
with the Ministry of Commerce of the People's Republic of China (MOFCOM) or its authorized bodies before filing customs declarations."   
Question 
Within this registration system, is there a mechanism to monitor companies which frequently cause complaints by foreign trade partners?  
 
Answer 
The Measures for the Registration of Foreign Trade Operators (Ministry of Commerce [2004] Order 
No. 14) provide that as long as the companies submit application material in full, the competent 
authority shall handle the registration formalities for foreign trade operators within 5working days. 
 3.1.9 Sanitary and phytosanitary requirements  
 
It is mentioned under paragraph 3.77 that "There have been no major changes in the legislation 
that regulates the SPS regime in China since the last Review. A myriad of laws and implementing 
regulations and rules continue to regulate China's SPS regime; some of these laws are outdated 
and repetitive (Table 3.7). Existing legislation stipulates the procedures to establish SPS requirements as well as to regulate imports subject to SPS measures, including aspects dealing 
with their inspection, quarantine and supervision. " In addition, paragraph 3.81 states that "There 
is an additional catalogue, the Catalogue of Im port Commodities Subject to Safety and Quality 
Permits, that stipulates the general standards for goods that are highly sensitive in terms of safety, sanitation and environmental protection. In  addition, imports of waste, which can be used 
as raw materials, must be inspected before loading to prevent harmful waste from entering 
Chinese territory".  
Question 
Does Chinese legislation on SPS requirements include both product safety and commercial quality requirements?  
 WT/TPR/M/300/Add.1 
 
- 145 - 
 
  
 Answer 
Chinese SPS requirements is generally a compelling technical regulations and standard, mainly in 
order to meet the four objectives stipulated in the SPS concerted Accessory A. While according to 
the Food Safety Act, Article 20, food safety stan dard should also cover the quality requirements 
related to food safety.  
Question 
Or, does it differentiate between a) product safety and b) commercial quality (such as sizing, uniformity, taste, labelling requirements, etc.) for imports of fresh fruit and vegetables, dry and dried produce, edible vegetable oils and pulses?  
 
Answer 
According to the Food Safety Act, Article 20, it st ipulated that quality requirements related to food 
safety is included in the food safety stan dard and are mandatory standards. And quality 
requirements with less connection to the food safety  such as the product specification, uniformity, 
taste have appeared in the form of recommended standards. Regarding the label, some standards 
are compelling, like GB 7718-2011General standard  for the labelling of pre-packaged foods, GB 
28050-2011 General standard for the nutrition labelling of pre-packaged foods, and GB 13432-
2013 General standard for the nutrition special diets labelling of pre-packaged foods.  
Questions 
If there are separate arrangements for "commercial quality" requirements:   
 - Are they mandatory or voluntary? 
 Answer 
According to Article 20 of the Food Safety Act, it  stipulated that quality requirements related to 
food safety is included in the food safety standard and are mandatory standards. Quality requirements with less connection to the food safety  such as the product specification, uniformity, 
taste is appeared in the form of re commended standard, and is voluntary. 
 
 - Are they based on international standards (such as those produced by UN/ECE), or are 
they national? 
 
Answer 
Most of them are based on international standards,  some of them are national, and some of them 
are local. 
  - Which institution is responsible for 'commercial quality' controls at import stage?   
Answer 
The Administration of Quality Supervision, Inspection and Quarantine and the local inspection and 
quarantine bureau. 
 
 - Are goods also controlled in the internal market for commercial quality?   
Answer 
Yes. 
  - Does China conduct a risk analysis for import and/or export controls for commercial quality 
in agricultural produce?  
 Answer 
Yes.   - Is there information accessible via internet concerning the requirements for "commercial 
quality"? 
 WT/TPR/M/300/Add.1 
 
- 146 - 
 
  
 Answer 
See the website of the AQSIQ, the Ministry of Agri culture, the National Health and Family Planning 
Commission and the Food and Drug Administration. 
 
Para 4.47, Services   
"…This additional liberalization has to be compared to China's WTO commitments where only three 
of the eight value-added telecommunications services (electronic data interchange, storage and forwarding and information services) were bound and at the level of maximum foreign ownership of 30%."  
 
Question Regarding paragraph 4.47, does China have a future  plan to increase this percentage limit over 
foreign ownership?  
 Answer 
China explicitly proposed to reserve the restriction on foreign ownership in telecommunication services. China will decide next opening measur es according to the development of domestic 
telecommunication market. China is willing to nego tiate with WTO Members in Doha Round Talks.  
 
Para 4.76, Services  
 "Fifth, regarding trading in futures, the "Regulat ions on the Administration of Futures Trading" 
were amended on 24 October 2012 so as to allow foreign institutions conforming to requirements 
to participate in specific futures trading. Crude o il will be the first of these trading areas to be 
opened up. The other types of trades that will be allowed have not yet been determined..."  
 
 Questions Could the Government of China explain measures behind the selection these types of trades, 
possible types, and also about the time schedule of selection?  
 Answer 
The China Securities Regulatory Commission (CSRC) will advance the opening up of futures market in a steady and reliable way in accordance with comprehensive assessment from multiple perspectives including the progress of free exch ange under Renminbi capital projects, overall 
strategy of opening up financial market, spot market characteristics of futures varieties to be 
opened (e.g. spot marketization degree and opening degree) as well as specific operating status of futures market (e.g. volume of futures trading and position scale).   
Para 4.131, Services  
 "The general railway policy to be implemented by this new institution is to continue to support the 
development of railway construction, in particular in the central and western parts of China, 
accelerate the reform of the investment and financing system and pricing reform, establish and improve the standardized subsidy mechanism for public welfare railways and transport, and 
expand the reform of railway enterprises. The precise implementation measures are still being 
devised and no timetable has yet been set."   Question 
Regarding this paragraph, when is the Government of China going to finalize deciding the 
measures?  WT/TPR/M/300/Add.1 
 
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 Answer 
In 2013, China separated administrative functions from railway enterprises and set up the National 
Railway Administration and China Railway Corporation. Pursuant to the Official Reply of the State 
Council on Issues Related to the Establishment of China Railway Corporation, China Railway 
Corporation undertakes public welfare transport required by the State. Meanwhile, the State Council decided to establish subsidy mechanism fo r public welfare railways and transport. The 
subsidy mechanism for public welfare railway tran sport undertaking public welfare transport tasks 
including students, disabled servicemen and agriculture-related materials and for operating losses of relevant public welfare railways including Qinghai-Tibet Railway and Nanjiang Railway was 
studied and established. Relevant specific implementation measures are being studied.  WT/TPR/M/300/Add.1 
 
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 ADDITIONAL QUESTIONS BY TURKEY 
GOVERNMENT REPORT  
 
3.3.2 Improving competitiveness through "going global", pg. 21, para. 3.39  
 As stated in the Government Report, "In 2013, the Chinese Government proposed the vision of 
establishing a "Silk Road Economic Belt" and a "Maritime Silk Road" as well as the initiative of 
developing the Bangladesh-China-India-Burma Economic Corridor and the China-Pakistan Economic Corridor. This helps China implement a new round of opening up and building a new system of an open economy, advance the growth of inland and border areas and the coordinated 
development of relevant regions, create a favorable surrounding environment and usher in a new 
phase of mutually beneficial and win-win opening up."  
Question 
From the point of China, what will be the exact po sition and role of Turkey while establishing a 
"Silk Road Economic Belt" and a "Maritime Silk Road" and which countries are potential members 
of that framework?  
 Answer 
The "Silk Road Economic Belt" and "Maritime Si lk Road" is an open and inclusive economic 
cooperation initiative proposed by the Chinese gove rnment in an background of profound economic 
globalization and regional economic integration, ra ther than an entity and a close mechanism, they 
are unlimited by country and welcome any country and economy who is willing to join. 
Interconnection and interworking of the infrastructure is an important part, we will put forward a 
batch of consensus-based significant collaborative  projects according to all parties development 
practice to make sure every project grow well. Free trade zones are of great significance in 
promoting the free-flowing of factors within the ar ea, the efficient resource distribution and the 
deeply integrated market, we would like to develop free trade relationship with countries and regions along the economic belts.  
SECRETARIAT REPORT 
 
3.1.1 Customs procedures and requirements, pg. 56, par. 3.5  
 
It is mentioned in the secretariat report that "In 2009, China launched a pilot programme on the Reform of Classified Customs Clearance, which applies only in certain ports for imports but 
nationwide for exports… In addition, under the Classified Enterprise Administration Reform, 
enterprises are classified in five different catego ries: AA, A, B, C, and D according to different 
criteria, including risk and credit ratings. Th e customs clearance treatment applied will depend 
upon the enterprise classification." 
 
Question When will be the pilot programme completed and be nationwide both for exports and especially 
imports?  
 Answer 
In May 2009, the General Administration of Customs chose 15 customs with heavy volumes like Beijing, Tianjin, Dalian, Shanghai as the test ar eas of the reform of the export-cargo classified 
customs clearance; To the end of the year 2011, the reform of the import classified customs clearance has been developed in 9 direct compet ent customs including Beijing, Shanghai, Ningbo, 
Qingdao, Huangpu, Zhanjiang, Lasa, Xining, Yinchuan, other 32 direct competent customs also 
launched parts of the pilot business; in June, 2012, the GAC decided extend the reform to customs nationwide, which covers all customs' business. 
 
Based on three-year reform experience, in 1 August 2012, the GAC decided to launch the pilot work of paperless customs clearance in 12 customs such as Beijing, Tianjin, Shanghai, Hangzhou, 
Ningbo, Fuzhou, Qingdao, Guangzhou, Shenzhen, Gongbei, Huangpu. As the reform constantly 
goes deeper, the bonus relived by reform become prominent and the effects in the simplification of 
the procedure, improvement of efficiency and pe rfection of the environment are remarkable. In WT/TPR/M/300/Add.1 
 
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 1 April 2014, the GAC issued an announcement on matters concerning the promoting of the reform 
of the paperless customs clearance (the GAC, announcement [2014] 25), and decided to extend the paperless pilot word to the customs nation wide, covering all the business of the customs 
clearance.  
 Question 
Given there is categorization of enterprises, who is  the relevant authority for this classification and 
how many years are the firms are allowed to benefi t from this system. In addition, is there any 
possibility for enterprises to reject their ra nking and demand review of the procedures?  
 
Answer 
1. The responsible authorities for the classification is the GAC in central and the competent 
customs in local. 
2. Under the current classified enterprises management system, for the enterprises classified in AA 
and A, the customs take a dynamic management and if the situation of downgrading does not 
occur, the same treatment is applied without any time limitation; but once the downgrading 
situations occurs, the customs will immediately start downgrading procedure and lower the 
category of the enterprise. 3. The customs does not make the rankings of th e enterprises, and those who applied to the AA 
and A category need to file an application to th e customs, only then the customs will start an 
assessment procedure. If the enterprise does not apply, the customs will not initiate the 
assessment procedure and evaluate it as AA or A category. But when a situation of downgrading 
occurred, the customs will initiate the downgrad ing procedure, lower the enterprise into the 
appropriate category. 
 3.1.1 Customs procedures and requirements, pg. 57, par. 3.8  
 
It is mentioned in the secretariat report that "Although China is making efforts to harmonize customs procedures across the country, it is also promoting and creating "new special customs supervision areas" that are governed by special regulations. China also applies different customs 
procedures to specific customs areas, in some instances on a trial basis. These pilot programmes 
are designed to assess whether policies would work and also to promote the development of 
certain areas and regions."  
 
Question Could the Chinese Government kindly elaborate more on the "new special customs supervision 
areas" and "different customs procedures to specific customs areas" and why are there different 
customs procedures and areas?  
 Answer 
First, in the business aspect, there is no such  a concept of "new special customs supervision 
areas", because regarding different customs proced ures in the special customs supervision areas, 
it is the different policies which decide the different procedures. In the special customs supervision 
areas, according to relevant provisions our financial department, implement different revenue 
supervisory policy. In accordance with different policy carry out different customs procedures, for 
instance, tax refunds as soon as the enterprise enters the special customs supervision areas 
except the tariff-free zones which means when the enterprise outside the special customs 
supervision area goes through the cargo enter procedure, the customs will issue a tax refund certificate, with which the enterprise can claim refunding the export tax in finance and tax department. 
 
3.1.4.1 Applied tariffs and tariff structure, pp. 58, para. 3.13  
 
It is stated in the report that "In China, duty rates on imports continue to comprise: MFN rates, 
agreement tariff rates, special preferential tariff rates, general tariff rates, and tariff quota rates; in addition, interim tariff rates, which are usually lower than MFN rates, are applied for a specific 
period of time – usually one year - and are actually the applied rate for that year."  
 WT/TPR/M/300/Add.1 
 
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 Question 
It is said that interim tariff rates are "usually" lower than MFN rates. Is there any tariff line which has a higher interim tariff rate than MFN?  
 
Answer 
No. 
 
3.1.6 Import prohibitions, restrictions, and licensing, pg. 64, par. 3.24   It is mentioned in the secretariat report that "China has three categories of imports: not restricted, 
restricted and prohibited. Most imported goods fall under the category of permitted; however, 
even these imports may be subject to automatic licences to monitor their volume for statistical purposes. MOFCOM and the GACC jointly issue an annual Catalogue of Goods subject to Automatic 
Licensing. In 2013, there were 442 tariff lines at the HS 8-digit level included in this Catalogue 
(Chart 3.2). There is an additional Catalogue of  Automatic Licensing for Solid Waste that can be 
used as raw materials in China; the last Catalogue was issued in 2009.41 Certain goods, including: 
goods imported for processing trade and then re-e xported, goods imported by FIEs for their own 
use, samples or advertising material of a value of less than RMB 5,000, which are not subject to automatic import licensing."   
Question 
How are these products identified and how they fall under the categories which were mentioned in paragraph 3.24? Is there any pre-notification procedure in case of any category changes?  
 
Answer 
According to the relevant provision of the WTO, the Foreign Trade Law and the Administrative 
Measures on Automatic Import License on Goods and relevant rules, China implements automatic 
import license management on certain products with the purpose of reinforce the real-time monitoring, get hold of general situations and provide the public information for the sectors. The categories of products are adjusted dynamically , and at the end of each year the products 
categories of automatic import license of the next year will be published  
 3.1.6 Import prohibitions, restrictions, and licensing, pg. 65, par. 3.29  
  
It is mentioned in the secretariat report that "The list of imports subject to restriction or prohibition can be adjusted as necessary, and imports of goods that are not included in the 
Catalogue can be restricted or prohibited on a temporary basis by the relevant authorities." 
 Question What are the necessary conditions for the adjustment mentioned in the paragraph 3.29?  
 
Answer 
The Article 16 of Foreign Trade Law stipulates the state may restrict or forbid the import or export 
of related goods and technologies, and provide el even reasons mainly including maintaining the 
state security, protecting people's health and safety, preserving the natural resources that may be used up in short-term, and international convention. 
 
3.1.7.3 Safeguards, pp. 72, para. 3.60   It is mentioned in the report that "Under SG Regulations, the applicant must provide detailed 
information with respect to the increase in quantities of the imported product for a period of at 
least five years prior to the submission of application, including: the annual import quantity and value of the product in question, the absolute expo rt quantity of the imported product from every 
export country (region) and its percentage of the total import quantity of the imported product; 
market share, in quantity and value, of total do mestic consumption, represented respectively by 
the imported product, the domestic like product and the directly competitive product; and an 
analysis of reasons for the increase in imports ." 
  WT/TPR/M/300/Add.1 
 
- 151 - 
 
  
 Question 
Does China demand the applicants to provide detailed information with respect to the share of the domestic market taken by increased imports; changes in the level of sales, production, 
productivity, capacity utilization, profits an d losses, and employment? If not, why?  
 Answer 
Yes. The applicants for safeguard investigations must provide detailed information with respect to 
the share of the domestic market taken by incr eased imports; changes in the level of sales, 
production, productivity, capacity utilization,  profits and losses, and employment in the 
applications. 
 
3.2 Measures Directly Affecting Exports, 3.2. 2 Export taxes, charges, and levies, pg. 79, 
par. 3.88  
 
It is mentioned in the secretariat report that "China continues to apply export taxes in accordance with the Regulations on Import and Export Tariffs." 
 
Question Does the Chinese government have any intention to abolish these export taxes?   
Answer 
Considering the need of protecting environment and natural resources, China will impose export 
taxes on part resources and high energy consumption products. In recent years, the amount of the 
tax items applied to export taxes remain stable on the whole. 
 3.2.3 Export prohibitions, restrictio ns, and licensing, pg 81, par. 3.96 
 
It is mentioned in the secretariat report that "China continues to impose global and destination-specific export quotas."  
Question 
Could the Chinese Government elaborate more on the "destination-specific export quotas."?   
Answer 
Paragraph 5, Article 16 of the Foreign Trade Law stipulates that in the case of the limited market 
capacity of the importing country or region the state may restrict or forbid the export and the 
import of relevant goods and technologies. At pres ent, the destination-specific export quotas is 
implemented in the supply of the livestock and po ultry for Hong Kong, China and Macao, China, 
considering the self-produce livestock and poultr y cannot satisfy the needs and the limited market 
capacity, the supply of the live pigs, cattle and chickens from inland to Hong Kong, China and 
Macao, China is subject to the export quotas license measures.  
 WT/TPR/M/300/Add.1 
 
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 16  QUESTIONS BY NORWAY 
Maritime sector  
Question 1 
China and Norway are both world leading maritime nations. Maritime cooperation between China 
and Norway is important. It contributes to the economic development in both countries.   
Norway attaches great importance to the negotiations on maritime services in the WTO. China and 
Norway are both participants in the Maritime Friends Group in the WTO. Norway believes supply of and access to maritime services on open, non-restricted and equal market conditions is crucial to 
the economic development. Improved offers and binding commitments in the WTO is an important 
basis for fair competition and economic growth in the global maritime industry. We also underline the importance of the Maritime Model schedul e (MMS) in the WTO negotiations to achieve 
meaningful liberalization in the maritime transport service sector.  
 
We note with interest the services liberalization measures in the Shanghai Free Trade Zone, where the "international relays" segment of coastal shippi ng has been partly liberalized and where wholly 
foreign-owned international ship management enterprises will be allowed. It would be interesting 
to hear if you foresee an expansion of these measures to other parts of China. In addition it would be interesting to learn more about the considerations of establishing an international ship 
registration system.  
 Answer 
Thanks for your attention and support for Shanghai Free Trade Zone. Regarding the further 
liberalization of the maritime service, whether expa nd the liberalization measures to other regions, 
China will decide according to how is the pilot work in Shanghai Free Trade Zone and the general planning on the development of the free trade test area. Under the framework of Doha Round 
talks, we would like to exchange views about this issue with Norway. As regards international ship 
registration system, since the year 2013, the Ministry of Transport developed the international ship registration system in Tianjin Dongjiang tariff-free zone and China (Shanghai) Free Trade Zone, 
and the breakthrough was made in many aspects, mainly like the ratio of foreign contributions of 
the registrant, the affirmation method of the amount  of the foreign contributions, the approval of 
the foreign seafarers, and the age of the foreign im ported ship or bareboat ship. If you would like 
to know more about this, see the pilot programme of international ship registration system in 
China (Shanghai) Free trade Test Zone. 
 Question 2 
In the report from the Secretariat (WT/TPR/S/300), we note in paragraph 4.117 that it seems that 
Chinese vessels engaged in international trade now are subject to tonnage dues. However, vessels of Chinese nationality and vessels of flag-States which have entered into treaties or agreements 
with MFN-treatment, are granted preferential rates with regard to taxes and dues levied. It may 
seem that in relation to these measures, international maritime transport operators will not have a level playing field in the People's Republic of China. It would be interesting to hear more about how this system works, and what possible implications it might have on the international maritime 
transport sector, including how it relates to the most favoured nation treatment as foreseen in the 
WTO context.   
Answer 
Article 3 of the Interim Regulation of the People's  Republic of China on Vessel Tonnage Tax, the 
same preferential rates apply to both the vessels of Chinese nationality and the vessels of flag-
States which have entered into treaties or agre ements with MFN-treatment. There are no more 
preferential rates specially applied for Chinese vessels. The situation that international maritime transport operators do not have a level playing fi eld in China does not exist. The expression of 
"granting each other the MFN-treatment for taxes and dues levied on vessels" means entering into 
a shipping agreement or treaty with China which grants its vessels the same treatment as that 
granted to the vessels of other WTO Members. Such  a provision is just a reflection of the WTO 
most-favoured nation principle. 
 WT/TPR/M/300/Add.1 
 
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 Question 3 
In paragraph 4.119 in the Report by the Secret ariat it is stated that the ad-hoc Tax-Free 
Registration Policy for Chinese-flagged ocean shipping fleet was renewed for the 12
th Five-year 
Plan (2011-2015). We have understood from earlier TPR's (2010) that the purpose of the policy is 
to "encourage the development of the Chinese-flagged ocean shipping fleet and to safeguard the legitimate rights of Chinese seafarers". Through exempting eligible vessels from customs duties 
and import value-added tax, the aim is to attract Chinese Flag-of-Convenience ships to register in 
China. The policy was originally scheduled to end in June 2009. We would like to know the reasoning for renewing it in the current Five-year Plan.  
 
Answer 
The main purposes are still to encourage the deve lopment of the Chinese-flagged ocean shipping 
fleet and to safeguard the legitimate rights of  Chinese seafarers. Through exempting eligible 
vessels from customs duties and import value-added tax, attract Chinese Flag-of-Convenience 
ships to register in China and fly five-star red flag for navigation.   
Seafood  
 Question 4 In December 2010 China introduced new testing and quarantine measures directed specifically at 
fresh, chilled salmon from Norway. These measures were further strengthened in February 2011 
by implementation of AQSIQ Order No 9. As a co nsequence, the export of fresh Norwegian salmon 
to China has dropped significantly.  
 
In late 2012 - beginning 2013 importers reported that local CIQs had limited the import quotas from Norway from 4-500 tonnes down to app. 50 tonnes per licence. These quotas have thereafter 
been further reduced to app. 20-30 tonnes per licence. In addition, processing time for obtaining 
the import licence has reportedly taken up to 4 weeks.  Prior to late 2010, trade in seafood developed in close cooperation between AQSIQ and the 
National Food Safety Authority (NFSA) to the satisfaction of both parties. Therefore, the 
introduction of control measures for Norwegia n fresh salmon were unexpected and surprising.  
 
Norway has questioned the justification of the im posed measures on fresh salmon both bilaterally 
and in the Committee on Sanitary and Phytosanitary Measures. Norway has on several occasions requested that this issue should be addressed be tween the relevant technical experts. However, 
such a meeting has yet to be agreed upon.  
 In view of the Parties' obligations under the WT O agreement, Norway would like to repeat our 
request for a meeting between the relevant auth orities - the Norwegian Food Safety Authority 
(NFSA) and its Chinese Counterpart, the General Administration of Quality Supervision, Inspection 
and Quarantine (AQSIQ) to discuss the follow-up of quarantine and quality inspection of Norwegian 
salmon imported to China in order to sort out the problems and to normalise trade in salmon.  
 
What steps will China take in order to find a so lution under the SPS-agreement with regard to the 
current challenges to trade in fresh salmon, and to normalise this trade?  
 
Answer 
1. The information of substandard Norwegian sa lmon is published in the column of unsafe 
imported food in the website of the AQSIQ; 
2. In accordance with practice, we will make notifications of the detection of the imported seafood 
to Norway in order to facilitate your export su pervision and to ensure China's imported product 
safety. 
3. China will take further risk analysis ba sed on the information provided by Norway. WT/TPR/M/300/Add.1 
 
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 ADDITIONAL QUESTION BY NORWAY 
Import Licensing  
 
Question 4 
According to information from economic operators, China applies a system of import licensing for imports of fresh salmon. Apparently, operators have to apply for a license every month for a 
specific amount of imports. Not only does this seem to constitute a de facto system of import 
quotas, it would also seem that the rules are applied differently depending on the origin of the product in question. Norway questions the justification for such a system as well as its conformity with WTO rules. Norway further regrets the lack of transparency about the procedures and request 
China to publish and make known the details of the system. We invite China to clarify this issue 
and provide the necessary information and justification of the system.   
Answer 
In recent years, China Exit-Entry Inspection and Quarantine Agency has detected parasite argulus, 
pathogenic microorganisms, over residue of ve terinary drug and other problems in salmon 
imported from Norway and other countries. To sa feguard the health of Chinese consumers, public 
health safety and fishery security, in January 2011, the General Administration of Quality Supervision, Inspection and Quarantine of the People's Republic of China (AQSIQ) issued the 
Notice on Strengthening Inspection and Quarantine on Imported Salmon in accordance with the 
Food Safety Act, the Law of the People's Republic  of China on the Entry and Exit Animal and Plant 
Quarantine, the Measures for the Supervision and Ad ministration of Inspection and Quarantine of 
Imported and Exported Aquatic Products and other laws and regulations (such laws and 
regulations have been notified by following WTO procedures) to strengthen salmon inspection and 
quarantine and stipulate measures including applying for import license of animal and plant quarantine. All measures adopted in the Announcem ent (including the requirement of applying for 
import license of animal and plant quarantine) are provided in the above-mentioned laws and 
regulations which are made public on the websites, and are not new measures. Therefore, there exists no "lack of transparency". Moreover, thes e inspection and quarantine measures are applied 
to all partners instead of targeting at any specific country. They are normal measures adopted in 
accordance with law and entirely conform to WTO/SPS rules.  
 It is noted that in recent years, China has freque ntly detected quality safety problems of salmon 
exported from Norway in recent years, and media from Russia and other countries also frequently 
reported problems of salmon exported from Norway . In particular, recently China has detected ISA 
virus in salmon exported by Norway to China, and ISA is a major animal infectious disease to be 
strictly prevented and controlled pursuant to Chin ese laws and regulations. According to Chinese 
laws and regulations, China has suspended import of salmon from relevant Norse enterprises, strengthened inspection on ISA virus in salmon im ported from Norway to China and banned import 
of salmon with positive ISA virus detected. China urges Norway to effectively strengthen salmon 
quarantine regulation to guarantee the safety of products exported to China and provide relevant 
information to China for risk assessment. China reserves the right to further adopt inspection and quarantine measures if more ISA viruses or othe r quality safety problems are detected in the 
future. WT/TPR/M/300/Add.1 
 
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 17  QUESTIONS BY THE EU 
WT/TPR/S/300 
 
Page 36 Paras 2.11 and 2.12  
Paragraphs 2.11 and 2.12 of the Secretariat's Report outline the procedures for administrative disclosure and publication of trade-related depa rtmental rules. There have previously been 
situations (e.g. in the case of VAT exemptions for regional aircraft) when a decision on obligations 
for private enterprises has been adopted and subsequently repealed without ever being published, all the while expecting companies concerned to comply.   
Question 1  
What steps is the Chinese Government taking to ensure that all relevant government decisions, made at all government levels, that concern obligations for a private enterprise are duly 
published?  
 Answer 
The Chinese Government implemented the Law on Legislation in 2000. Since then, openness has become a fundamental principle that the legislativ e actions must follow. The law also specifies the 
channels for public participation in the legislation process, including written comment consultations, workshops, hearings, reviews and di sclosure of draft laws and regulations. In 2001, 
based on the Law on Legislation, the State Council promulgated Ordinance concerning the 
Procedures for the Formulation of Administrative Regulations, and the Regulations on Procedures for Enacting Rules, laying down specific requirem ents for transparency in government legislation. 
Local government with legislation right also provides regulations on legislation disclosure and 
public participation. When drafting laws, re gulations or rules, the State council and its 
departments, and the local government with legislation right generally seek public comments by written consultations
，organizing workshops, hearings, review meetings and international 
symposiums, as well as disclosing the draft on the Internet to solicit public opinions, including 
those from foreign enterprises, associations and individuals. In recent years, except for a few 
exceptional cases, all drafts related to administrative regulations and departmental rules have 
been disclosed on the China Legislative Information Network System to seek public comment, and a minimum period of 30 days for public comment were provided.  
 
Page 42 Para 2.43 on regulatory reforms  The Paragraph describes the main laws specifically related to foreign-invested enterprises (FIEs). 
In early 2014, The Ministry of Commerce called for public comments on the Sino-Foreign Equity 
Joint Venture Enterprise (EJV) Law, the Sino-For eign Cooperation Joint Venture (CJV) Enterprise 
Law and on the Wholly Foreign-Owned Enterprise (W FOE) Law, with a view to reform the system.  
 
Question 2 
Could China elaborate on the intended direction of the planned legislative change, and what is the timeline for this reform? Has there been any consideration of merging the EJV, CJV and WFOE laws 
with the Chinese company law, so as to provide a non-discriminatory treatment between domestic 
and foreign companies?   
Answer 
The Decision on Major Issues Concerning Comprehensively Deepening Reforms calls for 
establishing fair, open and transparent market rules and exploring the management of foreign investment based on Pre-establishment National Treatment and Negative List. Currently, the 
Chinese government is actively promoting the re form of foreign investment management system. 
Following the requirement of unifying domestic an d foreign investment laws and regulations, the 
government is researching on the revision of the Law on Chinese-Foreign Equity Joint Ventures, 
the Law on Chinese-Foreign Cooperative Joint Ventures and the Law on Foreign Investment 
Enterprises, so as to create a clear, transparent and stable legal system for foreign investment and 
further enhance policy transparency. 
 WT/TPR/M/300/Add.1 
 
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 Investment 
 Page 42 Paras 2.45, 2.46 and 2.47  
The Investment Catalogue governs investment access to different sectors in China and was last 
revised in 2011. The Report notes that investment projects deemed to employ outdated technologies, over-exploit scarce natural resources or harm the environment are restricted.  
 
Question 3 Chinese authorities suggested that in the future the Investment Catalogue will be completely abolished and replaced with a negative list applicable across the entire territory of the country. 
Can China provide more details abou t the timeline of this reform?  
 Answer 
By exploring the establishment of a foreign investment management system based on Pre-establishment National Treatment and Negative Li st, the Chinese government will actively promote 
the reform of its foreign investment manage ment system, and unify domestic and foreign 
investment laws and regulations, so as to en sure stable, transparent and predictable foreign 
investment policy, and further promote investment facilitation.  Question 4 
Could China explain why are sectors such as distributions of pharmaceuticals, public sewage 
system carbonated beverages, car distribution or financial leasing companies restricted – although they are not employing outdated technologies, over-exploiting natural resources or harming the 
environment? What are the criteria and rationale for these restrictions?  
 Answer 
First, it needs to be clarified that the sectors mentioned in the question belong to either "encouraged" or "permitted" categories in the Catalogue of Industries for Guiding Foreign Investment. None of them are restricted sectors.  
The revision of the Catalogue of Industries for Gu iding Foreign Investment is done in Answer to 
the demand of economic development and restru cturing of the industries. The purpose is to 
continue to utilize foreign investment effectively,  introduce advanced technology and management 
experience, promote the upgrade and optimization of industrial structure and safeguard economic 
security. The Regulation on Guiding Foreign Investment Orientation (Decree of the State Council, [2002] No. 346) specifies the following as restricted foreign investment projects, including 1) 
technologically outdated; 2) unsuitable for resource conservation and eco-environment; 3) 
prospection and exploitation of the special ores  that fall within the category of protective 
exploitation requirement by the state; 4) indust ries the liberalization of which are subject to a 
transition period; 5) other conditions specified by relevant laws and regulations. 
 
Question 5  Could the Government provide more details on restrictions regarding telecommunications defined 
in the Catalogue?  
 Answer 
According to the Catalogue of Industries for Guiding Foreign Investment (2011 revision) and the Regulations on Foreign Investment in Telecommu nications Enterprises (State Council Decree No. 
534), foreign equity in value-added telecommunication sectors shall not exceed 50%, and for basic telecommunication sectors, it shall not exceed 49%. Foreign investment applying for nationwide 
operation in the basic telecommunication market shall meet the minimum register capital 
requirement of 1 billion RMB. Foreign investment applying for providing basic telecommunication services at province, autonomous regions and municipality level shall meeting the minimum 
register capital requirement of 100 million RMB.  
 WT/TPR/M/300/Add.1 
 
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 Page 44 Para 2.51  
The Report states that foreign investors may be allowed to own some shares in state-controlled enterprises in certain sectors. 
 
Question 6 Could China clarify which are the state-controlled enterprises that foreign investors are allowed to 
invest in, and whether there are any limitations,  for example the overall percentage of foreign 
capital or categorisation of an SOE? What are the criteria for deciding which sectors and enterprises are included in this scheme? How is the scheme likely to evolve in light of reforms of SOEs and of the foreign investment regime?  
 
Answer 
In 2010, the Chinese Government released the Opin ions of the State Council on further Utilizing 
Foreign Investment, encouraging foreign capital to participate in the reshuffling, restructuring, 
merging and reform of domestic enterprise, includ ing state-owned enterprises, by means of joint 
stock and acquisition. The Catalogue of Industries for Guiding Foreign Investment is the policy 
guidance for approving foreign investment projec ts and foreign investment enterprises. Foreign 
investors may refer to this catalogue when investing in Chinese enterprises.   Page 46 Para 2.57 
 
The Report mentions the draft Administrative Meas ures for the Verification and Approval and the 
Record-filing of Foreign Investment Projects. Since the WTO Secretariat Report was drafted, NDRC 
issued the revised Administrative Measures.  
 Question 7 
Could China detail what the main changes are and what was the rationale for them?  
 Answer 
The Chinese government intends to reform its foreign investment approval system, and explores 
the management of foreign investment based on Pre-establishment National Treatment and 
Negative List approach.. In December 2013, the State Council released the Notice of the State Council on Issuing the Catalogue of Investment Pr ojects Subject to the Approval of Government 
(2013 edition), specifying the scope for foreign inve stment that are subject to the approval of the 
government. In May 2014, NDRC released the Regulation on the Approval and Recordation of Foreign Investment Projects, which revises the co mprehensive approval approach into the limited 
approval plus general recordation approach. The regulation seeks to explore the provision of 
National Treatment to foreign investments in respect of market access management, and simplifying the rules and procedure fo r foreign investment management.  
 
China (Shanghai) Pilot Free Trade Zone (CSPFTZ) 
 Page 51 Para 2.80  
The Report notes the decision to integrate all th e special Customs supervision areas and establish 
a single Free Trade Zone.   
Question 8 
Are there plans to establish further FTZs along th e lines of the CSPFTZ? If so, would these also 
function as pilot zones for testing of reform policies?   
Answer 
Currently, the overall plan of CSPFTZ has been generally implemented, within the framework of 
which the opening-up of 23 service sectors have also been realized. In the future, other sectors 
will be further opened up according to actual needs. 
 WT/TPR/M/300/Add.1 
 
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 Page 52, paragraph 2.83  states that "trade facilitation measures are announced for application 
the Shanghai FTZ, including simplification of Cust oms procedures". On page 53, it is noted that 
there is the setting up of a FTZ Administrative Committee which has the responsibility of the 
administrative work in several areas incl. intellectual property (IP) rights.  
 Question 9 
How will IP border measures be implemented in  the FTZ in the context of customs procedures 
simplifications?   Answer 
The Chinese Customs pays great attention to IPR enforcement. Relevant regulations are being studied and drafted.  
Page 52, paragraph 2.84  
The CSPFTZ establishes a Negative List on Invest ment Access. The current list is quite long, and 
will be adjusted "when deemed appropriate".  
 
Question 10 Could China indicate a timetable for revising and shortening the List? Could China elaborate of the process of revising the List, and what criteria and considerations will be taken into account? Will 
third countries and foreign industry be consulted in the process?  
 Answer 
Currently, Shanghai is revising the Special Administrative Measures (Negative List) on Foreign Investment Access to the China (Shanghai) Pilot Free Trade Zone (2013), following the principles of enhanced openness and transparency and compli ance with the international norms. During the 
revision process, opinions from foreign chambe rs of commerce and enterprises were solicited, 
including EU Chamber of Commerce.  Page 55 section 3.1.1 - Custom procedures and requirements  
The EU is aware of concerns expressed by op erators over the rapidly changing rules and 
regulations and the lack of regula tory transparency. Exporters are frequently asked for additional 
documents at the customs clearance, about which they have not been informed by the Chinese 
authorities in advance. Customs clearance usually takes 2 to 4 weeks, which is especially 
problematic in the case of perishable or seasonal products.   
Question 11 
What are the measures that the authorities consider taking to remedy these problems? Given that China does use a system of verification of non-pref erential certificates of origin with regard to 
imported or exported goods, the EU would like to  know the deadline for the provision of reply to 
the request for verification.  
 Answer 
In the existing Customs clearance process, cu stoms declarations identified by the Customs 
computer system as high risk and subject to inte nsive review, after the electronic review and risk 
identification process, will be handed over for onsite review by the customs staff. In order to 
ensure the accuracy of the declaration and authen ticity of the goods, the Customs mainly inspect 
the items including categorization, price, origin, trade type and import-export management status. For ineligible goods, Chinese laws and regulations and Customs regulations empower the Customs to require the import declarant to submit or prepare additional certificates or documents for 
further review; the declarant may apply for guaranteed clearance according to procedures to 
facilitate goods clearance, on the condition that licensing certificate is not involved in the process.   
For goods that requires quick clearance time and fr esh, live, perishable and corruptible goods, the 
Chinese customs always provide clearance facilitation in the form of centralized declaration. For goods that requires quick clearance and fresh, live, perishable and corruptible goods that have 
multiple entry-export at the same port, enterp rises may declare goods import in the form of 
centralized declaration list for import and ex port goods first, then proceed with customs 
declaration on a regular basis. This mode will greatly simplify declaration procedure and improve WT/TPR/M/300/Add.1 
 
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 efficiency. Meanwhile, Chinese customs also provide clearance facilitation measures including 
"goods clearance with prior declaration", "clearance reservation 7*24".   
The inspection of non-preferential certificate of origin is mostly to verify whether the goods is 
originated from the country accused of anti-dumpi ng, anti-subsidy and other trade remedies, so as 
to use proper duty rate, anti-dumping anti-s ubsidy rate. Chinese customs has no specific 
requirement on the time duration of verification feedback. Before receiving verification feedback, 
import goods may follow the regulations to proceed with security clearance.  Regarding verification of certificate of origin pr ovided by foreign export ers, Chinese customs will 
transfer the certificate to related issuing agency for authenticity check, and will verify the actual 
production capacity and origin of the goods up on verification request if necessary. Chinese 
customs doesn't specify time limit of Answer to the verification request of non-preferential certificate of origin, but we will provide feedback  as soon as possible based on our capacity and 
actual condition .  
 Page 60, paragraph 3.19 and page 126 paragraph 4.10 : The Secretariat's report states that 
even though China had bound  100% of its tariffs as ad valorem  rates, it applies non ad-valorem  
tariffs for 43 tariff lines (including  some agricultural products, as reported in paragraph 4.10).  
 Question 12 
Could China please explain what is the rational for applying non ad-valorem  tariffs when the bound 
duties are ad-valorem ? How does China ensure that the bound duty is not exceeded?  
 
Answer 
The specific rates （VAEs）for each year since WTO accession is strictly converted from ad valorem 
rate in accordance with China's WTO commitment. The specific rates are re-calculated each year to 
ensure that the actual rates levied don't exce ed the committed ad valorem rate. The basis of 
conversion is the average import price of the rece nt years (past 4 years) provided by the Customs, 
however, for certain tariff lines, data deficiencies such as the lack of import record or significant 
fluctuation in the import price are corrected for the calculation. 
 Standardization and testing 
 
Page 73 Para 3.65  notes that standards in China continue to be developed mainly under the 
Standardization Law (of 1988) and the Regulations for the Implementation of the Standardisation 
Law (1990).  
 Question 13 Could China expand on the plan to modernise and simplify its standardization system, in 
particularly by the means of an update of the current Standardization Law (of 1988)?  
 Answer 
The Standardization Administration is working to  simplify and modernize the standard system, and 
is actively involved in revi sing the Standardization Law. 
 
Page 74 paragraph 3.1.8.2. Product certification in telecoms  
 Question 14 Could the Government provide some information regarding the ongoing review of the OSCCA 
regulation (CER) in China? Will the listing of ICT products within the Compulsory Product 
Certification Catalogue be affected, i.e. will there be a significant reduction of ICT products falling under the compulsory certification system?  
 
Answer 
Firstly, China would like to share with interested members about the update of the concerned 
measure. The Regulation on Commercial Encryption Products has been listed in the 2014 
Legislation Plan of the State Council of China, and currently the Regulation is being drafted in line 
with the Legislation Law and Rules on Formulation of Administrative Laws of China. OSCCA will undertake scientific evaluation and public consultations to ensure openness in the legislation 
process. WT/TPR/M/300/Add.1 
 
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The Multi-Level Protection Scheme (MLPS) has started the revision process. Still, we would like to explain that the essence of the Regulation on Cl assified Protection of Information Security is 
classified protection on information systems, aiming at safeguarding the basic information network 
and important information systems to ensure national  security and public interests. In China, the 
security of information systems in banking, educat ion, healthcare, transportation and other public 
utilities concerns have been attached great importance due to their close relationship with our 
citizens' welfare. Therefore, the "importance" of information systems is not necessarily decided by 
the sensitivity of that industry but by the possible damage it could cause to national security, social order, economic development and public interests, etc.  
In addition, these systems only cover a very lim ited portion of all the information systems in 
China. Therefore, it's very unlikely that it will ca use "significant" effect to international trade.  
 
China has made it clear on various occasions that in terms of intellectual property protection and 
government procurement, all enterprises within China will be treated equally in accordance with the non-discrimination principle of the TBT Agreement. 
 
Page 75, par. 3.75  The report indicates that in general there are fi ve major steps in the CCC certification application 
process: (i) submission of an application and supporting materials; (ii) type-testing (a CNCA-
designated test laboratory in China will test product samples); (iii) initial factory inspection (a 
CNCA-designated certification body will send repres entatives to inspect the manufacturing facilities 
for the product); (iv) evaluation of certification results and approval (or failure or retesting); and 
(v) supervision after the certificate is granted. However, each certification body may have different 
application procedures, according to the product's characteristics.   
Question 15 
Will China allow independent commercial testing houses to engage in testing under CCC, and foreign testing institutes to cond uct initial factory inspections fo r CCC abroad? Does China consider 
a change in the present conditions and elimination of restrictions in particular in order to allow 
airplanes at Civil Aviation Administration of China and mining equipment to be used on Chinese 
market?  
Answer 
China has altogether designated 13 certification agencies and 152 inspection labs. These 
designated agencies are independent third-party certification organizations. Foreign institutions 
may carry out CCC initial factor inspection in China according to the cooperation agreement 
between governments or government bodies and based on the commission contracts signed with Chinese certification agencies.  
Page 74 paragraph 3.70 on standards 
Concerns have been raised in the TBT Committee of the WTO on inter alia the length of time to comment and the ability of foreign companies to comment.  
 
Question 16 Does China intend to adopt a policy of systematic notification of draft technical regulations and 
mandatory standards to the WTO TBT Committee in accordance with the TBT agreement?  
 Answer 
Since China's accession to the WTO, we have followed the requirement of the TBT agreement to 
set up TBT notification and national enquiry point to fulfil the notification obligation. According to 
notification requirement under TBT, we have notified the relevant technical regulations and qualification evaluation processes as required. 
 WT/TPR/M/300/Add.1 
 
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 Sanitary and Phytosanitary  
 Page 65 paragraph 3.29  
The WTO Secretariat reports that "in 2013, there were some 30 temporary prohibitions in place on 
sanitary grounds, which affected mainly animal pr oducts imported from the European countries."  
 
Question 17 
Could the Chinese authorities provide an overview of the procedures that are applied to decide 
upon temporary prohibitions, and inform how China ensures that it minimises negative trade effects? How does China ensure these measures do not discriminate between national and foreign, 
or between various foreign sources of supply?  
 Answer 
SPS agreement allows Members to take preventive measures in emergency situation even if they 
have no sufficient scientific proof to justify their measures. China will accordingly take interim prohibition measures in case sudden disease breaks out in foreign countries, major disease is 
intercepted at port, unknown diseased is identified and is suspected of major impact and multiple 
inconsistencies happens with significant negative implication. These emergency measures are only temporary. After that China will conduct risk anal ysis as soon as possible to identify whether 
further measure is needed, the time limit of measures or remove the measures, so as to reduce 
the impact on trade to the minimum.  
 When countries encounter diseases that must be notified according to OIE catalogue and 
Catalogue for Entry Animals and Plants Quarantine of China, or breakout of emerging animal 
diseases, AQSIQ and MOA will follow the Law on the Entry and Exit Animal and Plant Quarantine and its implementation rules, OIE code and WTO/SPS agreement to launch prohibition release 
procedure to issue prohibition. 
 As a Member of WTO, OIE, IPCC, China actively follow international norms and never differentiate 
domestic and foreign enterprise and different sour ce of supply by foreign countries. Based on the 
above measures, China will notify WTO and fulfil its transparency obligation.  
 Question 18 
How does China ensure that its sanitary measures affecting imports from third countries conform 
to the SPS Agreement, which contains an obligation to adapt to regional conditions, including recognition of the concept of pest- or disease-free areas and areas of low pest or disease 
prevalence (Article 6)? In relation to the current animal health situation in the EU, why does China 
not follow this international obligation for example regarding African Swine Fever?   Answer 
WTO Members have the right to take restrictiv e import measures according WTO rules. China 
strictly follows WTO/SPS agreement on zoning rules and OIE standards on animal diseases zoning and acknowledges the definition of non-disease area and low prevalence area of diseases and 
pests. After zoning evaluation and field stud y of related countries, China adopts zoning 
management for entry animal quarantine for those complying with OIE standards and Chinese laws and regulations.  
 
Regarding ASF, the EU, as a free trade zone, does  nott take risk control measures against animal 
migration among members. After ASF broke out in  Poland, there was no strict zoning and bio-
security isolation zoning adopted. The ASF risk wasn't under control and the whole area was 
subject to disease risk (3 consecutive incidents in volving 6 cases of wild pig being infected with 
ASF in 2014). In spite of this, China only took me asures against Poland. Relevant countries, after 
eliminating ASF, may submit and provide detailed documents to China. We will organize experts to 
start procedure of removing prohibitive measures. 
 WT/TPR/M/300/Add.1 
 
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 Page 76 section 3.1.9 cosmetic products 
 In China, new cosmetic ingredients to be used fo r cosmetic production must be approved by the 
Chinese Food and Drug Administration authorities (CFDA).  
 Question 19 
Could China confirm that cosmetic ingredients not included in the Inventory of Cosmetic 
Ingredients IECIC2014, such as phenoxyethanol, CAS No. 122-99-6, benzoic acid, CAS No. 65-85-0 and collagen, CAS No. 9007-34-5, are nonetheless allowed as ingredients for cosmetic products?   
Answer 
First, Inventory of Cosmetic Ingredients is an objective list of all ingredients used in cosmetics 
production and sale in China. EU could refer to this catalogue for information; second, with the 
improved understanding of ingredient safety, an d new evaluation method, the regulators will 
conduct dynamic management of the catalogue, so  as to ensure that the reference used for 
judging new raw material in cosmetics is sound, practical and scientific. The materials not included 
in the Catalogue have to be examined through new material review process according to 
regulations before use.   Page 76 section 3.1.9 
 
EU Question 20 Page 77, paragraph 3.78 . The Report observes that "another salient feature of China's SPS 
system is the fragmentation of regulatory authorities among different Government agencies. 
Currently the Ministry of Health (MOH), the Ministry of Agriculture (MOA), AQSIQ, the State Administration for Industry and Commerce (SAIC), MOFCOM, and the State Food and Drug 
Administration (SFDA) are actively involved in regulating the SPS regime (Table 3.8). This 
fragmentation of the SPS regulatory system pres ents a challenge regarding the enforcement and 
implementation of policies and specific measures  as there could be an overlap of functions and 
thus an avoidance of responsibility and lack of accountability."  
 
Question 21 Could China explain which concrete actions and steps will be taken to ensure that the current 
fragmentation of the SPS regulatory system does not a) unnecessarily hamper trade and b) does 
not make application procedures are undertaken  and completed without undue delay? How China 
ensures that local authorities apply a uniform implementation of import conditions?  
 
Answer 
WTO does not specify how many departments shall be involved in managing plant health in member countries. Many countries, including the largest developed ones, have multiple 
departments responsible for implementing SPS,  and many measures taken by the different 
departments are related to international trade. Th e AQSIQ is responsible for regulation of import-
export food, animal and plant, and their products. The CFDA and MOA are responsible for 
regulation production and distribution sector; NHFPC is responsible for drafting and revising 
national standard on food security. The jurisdiction of different departments is clear cut, with clear labour division and cooperation. There is no fragmented or repetitive problem in China's health 
and plant health system as mentioned in para. 78, Chapter 3 of the Secretariat report. Different 
departments need to further communicate and coordinate with each other to avoid unnecessary barrier for trade, or delaying in the application process.  Local inspection and quarantine bureau follow th e universal import requirement of AQSIQ. There 
are no inconsistent requirements as raised in the question. 
 Question 22 
With regard to the recent adoption of "Detailed Regulations for the Administration of Bad Records 
of Imported Foods" by the China Food and Drug Ad ministration (CFDA), the EU would be grateful if 
China could explain how, in the event of a produc t being black listed either by mistake or because 
of a minor infraction, the authorities will ensure that adequate processes are in place to remove 
such a product from the black list, including through consultation with the necessary stakeholders?   WT/TPR/M/300/Add.1 
 
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 Answer 
The Detailed Regulations for the Administration of Bad Records of Imported Food is released on 
14 April 2014. The details can be viewed at: 
http://www.aqsiq.gov.cn/xxgk_13386/jlgg_12 538/zjgg/2014/ 201404/t20140414_ 409200.htm. 
According to Article 4 (removal of risk pre-warning) of the Regulation, foreign food import enterprises with bad record may apply for removal of risk pre-warning at food security authority in 
local country/region when they meet the condition for removal (Attachment 1). The local 
country/regional food security authority will cond uct investigation based on the application and 
report the rectification measures and investigation result to AQSIQ. If AQSIQ identifies that there is no risk or the risk is reduced to acceptable level after risk assessment, it shall timely lift the risk 
pre-warning and control measures.  
 Meanwhile, if a country/region in the record meets the condition for lifting risk pre-warning 
(Attachment 2), its food security authority shall report the investigation of the cause of risk and 
regulatory improvement to AQSIQ, If AQSIQ identifies that there is no risk or the risk is reduced to 
acceptable level after risk assessment, it shall timely lift the risk pre-warning and control 
measures. 
 Page 77, paragraph 3.79 "According to the authorities there have been no changes in any of the procedures to establish 
SPS requirements since 2010". The EU has raised it s concerns in the lack of improvement of the 
situation  
Question 23 
Could China explain how and when is the risk analysis carried out by China made available to trading partners in the event of a prohibition on imports of animals or plants being put in place? 
Could China explain which standard processing period is used to follow-up on an application to lift 
the prohibition once the epidemic has been brought under control?   Answer 
After implementing import prohibition on animal  and plant and associated products, China will 
follow SPS agreement to timely notify other SPS national contact points of the products under prohibitive measures, the scope involved and the re ason for prohibition, and will provide technical 
document at the request of trade partners. If related countries or regions have contained the 
diseases and submit requests for lifting import pr ohibition, China will follow international standards 
and procedures to organize experts to conduct risk analysis through questionnaire evaluation and 
filed study. Upon request of its trade partners, Ch ina can provide risk analysis report according to 
the time and approach reached in the bilateral ne gotiations. The progress of risk analysis depends 
on the cooperation and adequacy of techni cal documents provided by trade partners. 
 
The standard procedure of removing prohibitive measures is generally as follows: related countries 
or regions contain the diseases and raise request for removing import prohibition; China organizes experts to conduct questionnaire evaluation and demand for additional documents based on the 
evaluation; if the documents could prove that the risk is under control, China will prepare expert 
mission to conduct onsite evaluation; complete risk analysis report; the prohibition will be removed by AQSIQ together with MOA for those meeting China's health requirement. The format 
will be joint statement by AQSIQ and MOA.  
 Page 77, paragraph 3.83 The Report notes that "China's national enquiry point for SPS continues to be the AQSIQ. Between 
2011 and 2013, China made 286 notifications regarding the adopted SPS measures. Seven of 
these notifications were related to emergency measures: five were about the use of food additives and were put in place on grounds of food safety and to safeguard human health, and the other two 
were aimed at preserving plant health through the prohibition of imports of contaminated seeds, 
and of logs and timbers from certain territories.  
Question 24 
Could China specify how many of the notified SPS measures conformed to a relevant international standard, if such a standard exists? If comments from third parties were received, how did China consider them, and include them where relevant, in its internal legislative process? Does China WT/TPR/M/300/Add.1 
 
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 consider easing the present conditions (especially the process of documents submitting)/ shorten 
the length of testing of SFDA certification for imported items in order to allow these to enter and to be used in China? 
 
Answer 
China's WTO/SPS inquiry point is responsible for timely handing over the inquiries and comments 
to related authorities; keep track of their Answ er and provide detail Answers to the inquirer. For 
example, China has submitted a set of answers to 7 member countries and 6 international associations regarding the Detailed Regulations for the Administration of Bad Records of Imported Food. 
On the condition of ensuring consumer's health, China will consider EU's suggestion on extending 
the terms and reducing the certification an d test duration of imported goods.  
 
Pages 84-85 Export Finance, Insurance and Guarantees  
 Para 3.108 and paragraph 3.111 
In paragraph 3.108, it is said that China Eximbank  is a wholly state-owned bank that at the same 
time provides export financing services and acts as  an official provider of credit to developing 
countries. In paragraph 3.111, it is reported that China in practice follows the OECD gentlemen's agreement. 
 
Question 25 What is China's assessment of possible conflict between the two roles of China Eximbank? What 
steps are taken to ensure that the bank's policies do not unduly privilege Chinese companies on 
third (mainly developing) country markets in ways that would contravene the OECD Agreement on Export Credits that China appare ntly in practice adheres to?  
 
Answer 
China Eximbank is a wholly state-owned bank. It is  also the official provider of export credit. 
There're similar entities in many other countries, and these two functions don't contradict with 
each other. China Eximbank refers to OECD gent lemen's agreement in its management of certain 
credit businesses. But China is not an OECD member, and the gentlemen's agreement is not binding for China. 
 
Page 84-85, para 3.26 and para 3.107  " Export finance, insurance, and guarantees continue to 
be granted in China by at least two institutions  playing broadly complementary roles. These are: 
the China Export-Import Bank (China Eximbank),  and the China Export and Credit Insurance 
Corporation (SINOSURE). The China Development Bank (CDB) finances exports but according to the authorities, is not an official export finance institution."  
Question 26 
Could China clarify whether CDB when lending for these purposes can fund its loans through direct access to the currency reserves managed by SAFE (State Administration for Foreign Exchange)? 
Secondly, could China elaborate on the timetable of the reform of CDB which was initiated and 
later put on hold?   
Answer 
CDB does not fund its loans through its access to the currency reserves managed by SAFE. 
Commercialization reform was launched in CDB in 2008. First, CDB Corporation was established after shareholding reform. Second, a standa rdized corporate governance structure was 
established, and CDB is operated in accordance with the requirements of modern corporate 
governance. Third, CDB Capital Company Ltd. and CD B Securities Company Ltd. were established.  
 WT/TPR/M/300/Add.1 
 
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 Page 88 Para 3.126 State Owned entities and banks  
The Paragraph describes programmes to support different industries other than those notified by China, including the provision of grants and polic y-lending by state-owned banks. The Report also 
notes that no information was provided to the Secretariat on these specific aspects of China's 
industrial policy and that many specific suppor t measures seem to be the result of internal 
administrative measures that are only available in Chinese.  
 
Question 27 Could China provide more information on such industry-specific support measures both at central and provincial levels? Does China intend to notify them, where appropriate under WTO obligations, 
and take appropriate measures to remedy this lack of transparency? Could China elaborate on the 
"state capital operational system" where a part of SOE profits are pooled together in one fund and 
redistributed to fund R&D activities of othe r SOEs? Could China provide information on the 
monetary amounts involved and rules governing th ese transfers? When does China plan to open 
public R&D programs for FIEs in China?   
Answer 
China has been working hard on preparing the next subsidy notification since the last trade policy 
review, and will try best to include Sub-central government programmes in the next notification. Concerning the state capital operational system, ther e is no statistics on expenditure in support of 
enterprises R&D. Also, the existing management me thod of science and technology grant provides 
equal support to domestic and foreign invested en terprises. The Chinese Government clearly calls 
for further opening up science and technology, seeking new mechanisms and approaches to 
brining in eligible foreign R&D institutions to join effort in implementing national science and 
technology plan, attracting high-calibre overse as experts and research team to undertake or 
participate in project implementation, and finish tasks according to the work plan. 
 
Pages 90-91 Paras 3.131 and 3.132  The Chinese Government provides industry-specific subsidies, allowing inefficient industries with low productivity to survive and create overcapacity in some sectors. 
 
Question 28 What is the Chinese Government's assessment of  the apparent link between overcapacity and 
dumping, borne out by the observation of Chines e exporting overcapacity-affected sectors often 
being subject to anti-dumping investigations? What is the Chinese Government aiming to do to tackle overcapacity?  
 
Answer 
The factors that may trigger anti-dumping investigations are various and complicated, such as similarity of industry structure between export ing and importing countries, competition between 
products, demand of importing market, commercial competition considerations of the domestic 
industry in the importing country, etc. Overca pacity and anti-dumping are not necessarily 
connected. 
 
Page 92 Para 3.133 : competition policy and Page 95 para graph 3.145 states that both the AML 
and the Price Law prohibit price fixing and qu antitative restrictions, such as cartels.  
 
Question 29 Regarding cartels, how does the enforcement authority decide which law to apply? Will it apply both? What is the interaction between the differe nt laws? What are the rules of engagement and 
the procedural rights of parties under the AML leniency rules? Is there a written description of the 
leniency programme and its application?   
Answer 
For any conduct of a cartel case that occurs afte r or extends into the implementation of the Anti-
Monopoly Law, NDRC will apply Anti-Monopoly Law on the principle of new laws taking precedence 
over old ones. The monopoly agreements as stipul ated in the Anti-Monopoly Law and the acts of 
price collusion as stipulated in the Price Law differ from each other in their legal constitutive elements. In accordance with the principle of "no one is punished twice for the same offense" as WT/TPR/M/300/Add.1 
 
- 166 - 
 
  
 stipulated in the Law on Administrative Penalty,  NRDC does not mete out punishments twice in 
accordance with Anti-Monopoly Law and Price Law respectively.  
The leniency system is clearly stipulated in the paragraph 2 of article 46 of the Anti-Monopoly Law, 
which reads: "Where any business operator vol untarily reports the conditions on reaching the 
monopoly agreement and provides important eviden ces to the anti-monopoly authority, it may be 
imposed a mitigated punishment or exemption from punishment as the case may be." In addition, 
the article 14 of the Provisions on the Administrative Procedures for Law Enforcement against Price Fixing also makes specific procedural stipulations  on the leniency system with regards to price 
cartel: "For the first business operator that reports the relevant information and provides 
significant evidence of the price monopoly agreem ent, the price regulation agency may completely 
exempt it from the penalty; for the second, the price regulation agency may mitigate the penalty 
no less than 50%, and for the others, the price authority may mitigate the penalty no more than 
50%. Significant evidence refers to evidence that plays a key role for the price regulation agency 
in determining a price monopoly agreement." ND RC will further study the leniency system and 
formulate the relevant detailed rules and regulations.  
 
Page 92 Paragraph 3.134  states that "The AML does not take precedence over other 
competition-related legislation."  
Question 30 
How do the Chinese competition authorities ensure that competition policy is taken into consideration in the formulation and enforcement of  other policies by other Ministries and bodies? 
In particular, when enforcement is at stake, what  are the division of responsibilities between the 
Chinese competition authorities and the sectoral regu lators (for example on telecoms or on energy 
or in the financial sector)?  
 
Answer 
The concept of competition policy is clearly put forwarded in the Anti-Monopoly Law. In accordance with the Anti-Monopoly Law, administrative organs  are not allowed to abuse administrative power 
to formulate stipulations to eliminate or restrict  competition. The Anti-Monopoly Law of the P.R.C 
applies to all industries and sectors. Any monopolistic conduct in violation of the Anti-Monopoly  
Law will be investigated and handled by the anti-monopoly law-enforcement departments in 
accordance with law so as to maintain the market order of fair competition.  
 The anti-monopoly law-enforcement organs are fully responsible for investigation and law-
enforcement of anti-monopoly cases. In the process of investigating the case, industrial 
supervision organ may be invited to provide relevant materials where necessary.   Page 93 Paragraph 3.136  refers to AML enforcement in respect to SOEs: "In accordance with 
the AML, the State will supervise and regulate thes e firms' operations and the prices of the goods 
and services they supply."  
Question 31 
Has China adopted any written guidelines for the AML supervision of SOEs which it could share with the WTO and its Members?  
 
Answer 
It is stipulated in Article 7 of the Anti-Monopoly Law that with respect to the industries concerning the lifeline of national economy and national se curity, the state protects the lawful business 
operations conducted by the business operators therein. However, these enterprises must not 
conduct monopolistic conduct to damage the interests and rights of consumers by taking advantage of their controlling position. Relevant law-enforcement organs exercise supervision 
upon the conducts of the above-mentioned enterpri ses from different perspectives. All enterprises 
are equally treated in the sight of the AML Law.   
Paragraph 3.154 notes  that "MOFCOM can also conduct, within its competence, an investigation 
of concentrations between undertakings which do not reach the notification thresholds, if facts and evidence are found to indicate that the concentratio ns are likely to have the effect of eliminating or 
restricting competition."  WT/TPR/M/300/Add.1 
 
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 Question 32 
Is there information publicly available about merger cases dealt with by the Chinese authorities?? How does MOFCOM deal with undertakings failing to notify their concentrations against the 
requirements of the AML, and are there any sancti ons applied in those cases? How many cases of 
this kind has MOFCOM investigated?   
Answer 
From August 2008 to the Q1 of 2014, the Ministry  of Commerce received declaration of 910 cases 
of concentration of business operators, placed 85 5 cases on file and concluded 818 cases. Of all 
the concluded cases, 786 cases were unconditionally approved, 22 cases were conditionally 
approved and 1 case was forbidden. Since the Q4 of 2012, the Ministry of Commerce has 
published the relevant information about the uncondi tionally approved cases. Each decision on the 
case of concentration of business operators made by the Ministry of Commerce includes the fact 
based on which the determination is made and the legal basis. For further information about these 
cases, please visit: http://fldj.mofcom.gov.cn/.   
Paragraph 3.159  refers to the merger cases decided from 1/1 2012 till 1/5/2013. 
 Question 33 How does China ensure that application of merger control is solely based on competition grounds? 
Is China envisaging to further increase transparen cy in its enforcement actions e.g. in terms of a 
higher frequency of publication of decisions, e.g. by  starting to publish the notifications it receives 
from economic operators of mergers submitted to the competition authority?  
 
Answer 
The Chinese Government believes that timely pub lication of the information about investigating 
and handling anti-monopoly cases is conducive to enhancing the law-enforcement transparency, 
facilitates public supervision, and encourages ente rprises to operate in accordance with law. The 
Ministry of Commerce enforces laws in strict accordance with the relevant stipulations in the Anti-Monopoly Law, and works hard to improve the su pporting regulations on anti-monopoly review of  
the concentration of business operators. Through making supporting legislation, China improves 
the operability of the Anti-Monopoly law and im proves the law-enforcement transparency.  
 
IPR/Patents/Trademarks  
 Page 109 Paragraph 3.199 states  "(a): "Improving the Trademark examination process": as to 
enhancing Quality, Consistency and Transparency, will China open its TM related Databases". 
 Question 34  Could China clarify whether SAIC will join the "TM View Database" and offer the corresponding 
Web services on "SAIC/CTMO" websites in order to better serve Trademarks applicants and other 
Trademarks Users of the Chinese system?   
Answer 
The SAIC is now conducting feasibility study on the above-mentioned work along with the Office 
for Harmonization in the Internal Market of EU. 
 
Paragraph 3.199 , (b) states: "implementing a strategic industries IP work plan to take into 
account the IPR protection needs of these industries".  
Question 35  
Is this work plan adopted and published? Which co ncrete measures, actions, cooperation activities 
are/will be developed in order to achieve the set objectives? Is there an agenda attached to the 
work plan?  
 Answer 
SIPO issued in 2013 the Working Plan for Intellect ual Property Rights of Strategic New Industries, 
summarizing and classifying routine measures implemented by relevant departments on intellectual property rights of strategic new industries, which mainly include: strengthening analysis and appraisal of intellectual property rights; improving administrative capability of WT/TPR/M/300/Add.1 
 
- 168 - 
 
  
 intellectual property rights; promoting innovative layout of intellectual property rights; enhancing 
the transfer and use of intellectual property ri ghts; improving service capability of intellectual 
property rights; building the information platform of intellectual property rights; optimizing 
development environment of intellectual property ri ghts and strengthening work related to foreign 
intellectual property rights, and etc., so as to guide relevant work in 2013. 
Paragraph 3.199, (h)  states: "carrying out an evaluation and selection of the best performers in 
implementing the National IP Strategy".  
 Question 36 Could China inform whether this evaluation and selection process has been launched? Is the 
evaluation and selection process public and where can the relevant information be found? Is there 
an agenda for such a process and what are the concrete steps, criteria, used? Which entity is carrying out the process and which stakeholders are concerned by the evaluation/selection?  
 
Answer 
In 2013, the implementation of the national intell ectual property strategy inter-ministerial meeting 
office conducted a comprehensive estimation on th e work over the five years since the national 
intellectual property strategy has been implem ented, summarized achievements and experience 
and analyzed problems occurred as well as work to be improved. According to the result of 
estimation, most strategic focuses, special tasks and strategic measures determined by the Outline 
of the National Intellectual Property Strategy (" the Outline") have been strongly promoted and 
wined remarkable achievements and the five-year goals have been basically reached. Next, the Chinese Government will continue to adopt powerful measures, further strengthen implementation 
of intellectual property rights strategy, so as to  ensure the completion of the goals 2020 proposed 
by the Outline. 
Page 112, Paragraph 3.206 on patents  
 
Question 37 Could China comment on how will SIPO's commitment to adapt its interpretation of Patent examination Rules on "inventive threshold" and "s ufficiency of data" be implemented so as to 
achieve improved streamlining with other major World IP Offices' practice and interpretation of 
similar rules? Will China introduce "supplementary protection certificates" (patent restoration of term due to regulatory delays) for pharmaceutic al and plant protection products patents? Will 
China introduce "data/market" exclusivity for pharmaceutical dossiers?  
 Answer 
Please, refer to the reply on the EU follow-up questions.  Page 112 Paragraphs 3.205 and 3.206 (and pa ragraph 2.28 page 9 of the Government 
report ) regarding court trials of IPR that are broadcast online, paragraph 3.3.5.4.3 on trade 
secrets and undisclosed information.  
 Question 38 
Could the authorities clarify whether this broadcasti ng approach is supposed to cover courts at all 
levels and all types of IPR cases? If this is not the case what criteria are applied to arrive at a decision? How does this approach take into account possible confidential information or trade 
secrets revealed by the parties during the proceedings?  
 Answer 
According to article 13 of the Civil Procedure Law,  when hearing civil cases, the People's Courts 
shall organize public hearing. Cases involving nati onal security, privacy or other situation protected 
by law may be excluded. For those involving divorce or trade secrets, the cases may not be publicly heard if the persons concerned apply for closed hearing. In addition, the Court shall resort 
to live proceeding if these are major cases with grea t social attention, wide implication, significant 
dispute of interest and bearing on industry development. Not all IP cased proceeded at different levels of court are subject to live hearing. Live hearing is an approach to increase judicial openness 
of the People's Court. 
 WT/TPR/M/300/Add.1 
 
- 169 - 
 
  
 Page 112, Paragraph 3.207 Requirements for applications for foreign patents 
 Question 39 
How does China plan to match the need for national-interest clearance with the requirements of 
the international IP system? Are there plans to mo re closely define the definitions of substantial 
content in order to provide more clarity for users and applicants?  
 
Answer 
Please, refer to the reply on the EU follow-up questions.  
Page 115, Paragraph 3.224 (Geographical indications) 
The EU is aware of China's three parallel protection  systems for GIs, i.e. the protection of GIs as 
Trademarks, as GI products, and as GIs of primary agricultural products. The three systems work 
separately and have their own mechanisms, but overlap in scope. As a result, the same GIs may 
be simultaneously protected by two or more legal systems.  
Question 40 
How does China ensure that in practice conflicts between the different GI protection systems are avoided?   
Answer 
There are two types of protection for GI, namely  protection by special law and protection by 
trademark law. MOA uses special law and follows Agriculture Law, Produce Safety Law and 
Management Method on Geographical Indication of Agricultural Product to protect the GIs of 
agricultural products. Right owners may voluntarily  select either special law or trademark law for 
protection according to different levels of protection and self-protection demand. As long as the 
right owner remains the same, they can register under different systems and get protection from 
multiple departments.   Page 118, Paragraphs 3.241/3.243 (undisclosed information and trade secrets) 
 
EU Question Is China considering specific legislation on trade secrets? 
 
Answer 
The Law of the People's Republic of China for Countering Unfair Competition makes clear 
stipulations on the connotations of trade secrets and various means of infringement on trade 
secrets. In addition, stipulations on protection of trade secrets are also made from different perspectives in the Criminal law, the Contract Law, the Labor Contract Law, the Company Law and 
relevant judicial interpretations and departmental rules and regulations. With all these taken into 
consideration, China has established a complete set of legal system and judicial interpretations 
concerning the protection of trade secrets. Whether it is necessary to make special legislation to  
integrate all the legal and regulatory stipulations on  protection of trade secrets needs to be further 
studied.  
 Page 118, Paragraph 3.245 states : "All public security authoritie s above the prefecture and city 
levels in China have established IPR crime coordinating activities and lead organizations to arrange 
and coordinate actions to crack down on infringement and counterfeiting activities".  Question 41 
Could China indicate the legal framework of the described coordination activities? Are the 
conditions and measures of such concerted actions clearly stipulated? Does China intend to implement further measures to harmonize and coordinate the approach taken by (regional) 
Prosecutors and Courts in IP and enforcement matters?  
 Answer 
We are in the process of coordinating domestic agencies involved to generate proper details on this issue.  WT/TPR/M/300/Add.1 
 
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 Page 121, Paragraph 3.253 (enforcement of trade mark rules)  
 Question 42 
Which measures will be taken in order to ensure, both at administrative and judicial level, effective 
and sufficient consistency in the recognition of a well-known character, and of the application and interpretation of rules related to well-known trademarks?  
 
Answer 
Clear stipulations on recognition and protection of well-known trademarks are made in the newly revised Trademark Law promulgated on 30 August, 2013 and the newly revised Regulations for the 
Implementation of the Trademark Law promulgated on 29 April 2014. Both administrative and 
judicial authorities should conduct corresponding works in strict accordance with the above-mentioned law and regulations.  
 
Page 121, Paragraph 3.255 (Supreme People's Court rulings)  
The EU notes that no reference is made to the Supreme People's Court Opinion on How to Exploit 
Intellectual Property Trials to Further and Enrich the Socialist Culture and to Develop a Self-reliant and Balanced Economy (Fa Fa (2011) No 18), introducing the "inclusive development doctrine" (co-existence of similar trade marks).  
 
EU Question 43 Could China explain the relevance of this opinion for future cases, and/or indicate whether the SPC 
might revise this opinion?  
 Answer 
The People's Court always follows the general principle of protecting prior right of trademark, clarify trademark boundary to the maximum and safeguard fair competition when hearing trademark infringement and unfair competition cases. It is also the future for the Court to work on and improve in judicial practice. Article 9 of the above Opinion states that trademark with similar 
components are allowed for proper co-existence. This mainly refers to co-existence cases due to 
complicated historic factor or other objective reasons. It is exceptional and special case in judicial protection of trademark, and must be recognized according to the facts of individual cases. For 
exception and special cases, it doesn't mean that all cases will be considered by court hearing.  
 Agriculture 
 
Page 128, Paragraph 4.17  states that "Agricultural exports subject to state trading are cotton, 
rice, maize, wheat and tobacco." At the same time, according to Table 3.17 (Export products subject to state-trading arrangements, 2011-13) wheat is not subject to state trading.  
 
Question 44 Could China clarify which agricultural products exports are subject to state trading (import and 
export/price setting)? The EU is also interest ed in the export values, volumes and the main 
destinations of products subject to export under STEs.   
Answer 
For relevant information on exports of state trading enterprises, please consult the answers to the 
questionnaires on export competition submitted by the Chinese Government to WTO Agricultural Committee.  
 
Page 103, paragraph 3.174  reports that "the state-trading enterprises themselves determine 
the price of the goods that they export". 
 
Question 45 Could China clarify whether or not all products subject to state trading are being exported under a 
market price? If so, how does China ensure that there has been no element of an export subsidy? 
Could the products be exported by the STE with lower price than the price of the same or like product sold on the domestic market?   WT/TPR/M/300/Add.1 
 
- 171 - 
 
  
 Answer 
State trading is operated following market mechanism, with no government interference. They 
adjust the quantity and progress of import and export according to the supply and demand and 
price change in the internal market. 
 Question 46 
China provide information if there has been any government financing or debts write-offs for the 
agricultural exporting state trading enterprise s during 2011-2013 or prior periods? Could the 
authorities clarify at which price cotton is bought for public stocks and how this price relates to average market price for cotton sold on the Chinese market and compared to reported world 
market prices?  
 Answer 
Temporary reserve programmes were introduced to safeguard food security. In recent years, the 
international market has been quite unstable due to the development of bio-energy and other non-
traditional factors. Hence, the domestic market is heavily influenced. In light of this, the 
government launched temporary reserve programme s to maintain stability of the domestic 
market. The reserves are purchased and sold at market prices, but are not exported, casting little negative impacts on domestic and international markets.  
Page 129 internal measures and support measures  
 Table 4.5  of the Secretariat paper lists various agricultural subsidy programmes. 
 
Question 47 The EU would be interested to know how much is the total budgetary outlay devoted to agricultural 
domestic support as well as a breakdown of this spending per programme during the period under 
review.   Answer 
China's budget for agriculture support is calculated differently from that of WTO agriculture agreement. Thus no budget expenditure can be submitted. For data on China's support for domestic agriculture, please refer to the notifica tion submitted by the Chinese Government to WTO 
on agriculture domestic support.  
 Paragraph 4.25 : For the comprehensive subsidy on agricultural inputs (which compensates for 
the increase of the price of inputs such as fertiliz ers and diesel fuel) the specifics of the subsidy are 
formulated by provincial governments.   Question 48 
Could China clarify what do these specifics cover? Considering that the price of inputs in general is 
uniform over a country's territory, could China comment on why is there a need to adapt the specifics to local conditions?  
 
Answer 
Subsidies are provided to compensate for the increa se of the price of inputs such as fertilizers and 
diesel fuel. As China is vast and its various regions differ from each other in the causes of the 
increase in prices, the central government grants lump-sum subsidies to different regions and the local government decides the criteria for granting subsidies in light of local conditions.   
Paragraph 4.26 : "The New Variety Extension Payment scheme" has been changed in 2009 and it 
now varies according to the commodity and may involve a number of types of transfers to the farmers."  
 
Question 49 Could China expand on the rationale in giving the subsidy in different forms depending on the 
commodity? How will this change affect the way this program is notified to the WTO?  
 WT/TPR/M/300/Add.1 
 
- 172 - 
 
  
 Answer 
Subsidies for superior strains and seeds are granted according to the plant area. Subsidies for 
superior strains and seeds of rice, maize and rape seed are granted in cash to farmers directly 
according to their farmland areas; for wheat, soybeans and cotton, provincial governments decide 
whether to provide direct subsidy to farmers or cu t seed price. The reason for different subsidy for 
different plants is that, rice, maize and rapeseed generally have hybrid superior seeds, which 
farmers can purchase directly in the market, thus the subsidy can be granted directly to them; 
wheat and soybeans have both hybrid superior and normal seeds. In case farmers stop purchasing hybrid superior after getting subsidy, governme nts organize tendering of superior seeds. The 
organization winning the bid will provide seeds to all. Farmers can purchase such seeds at 
preferential price with the subsidy. For next step , we will further improve the approach of granting 
superior seed subsidy. The change of methods of delivering subsidy doesn't affect the notification to WTO. Superior seeds 
subsidy is granted according to plant area and is  notified in the amber box for special product 
support. It is implemented within a minimum amount.  
The WTO Secretariat report does not cover China's policy regarding food aid.  
 Question 50  Can China confirm that it does not grant international food aid?  
 
Answer 
China provides food aid as humanitarian relief in  times of emergencies. The food aid programmes 
are in small size, casting no influences on international market. China provides aid in Answer to 
emergency requests from UN World Food Program or countries in need. All aid is provided in fully grant form with no conditions attached. China does not limit the beneficiaries' right to monetize or 
re-export the aid. 
 On 27 July 2011, the Chinese Government provided  food aid of 90 million RMB to the Horn of 
Africa through UN World Food Program after UN de clared that Somalia was suffering from famine 
on 20 July. On 15 August, upon request, China provides food aid of 353 million RMB to African 
countries, namely Ethiopia, Kenya, Somalia an d Djibouti. On 6 September, China provides 
90 million RMB to Zimbabwe as food aid as requested by Zimbabwe government. 
 
Government procurement   
Page 105, in paragraph 3.175 , it is reported that "There have been no major changes to 
China's legislative and regulatory regime for gove rnment procurement since the last Review. China 
continues to be engaged in the process of a cceding to the WTO Agreement on Government 
Procurement (GPA). This may imply eventual chan ges to the legislative regime, currently in a 
preparatory stage, to align it with the provisions of the GPA." The EU is of  the view that Public 
procurement under both China's Government Pr ocurement Law and the Tender and Bidding Law 
continues to discriminate against foreign enterprises in China. Moreover, some regions are issuing 
procurement certificates which allow or require a company/bidder to be prequalified prior to 
entering into the actual bidding process itself.   
Question 51 
In view of the ongoing negotiations for China's accession to the GPA, what are the concrete steps which China envisages to take for the alignment of its procurement legislation with the GPA rules and by which timeline? In particular, when does  China envisage eliminating the preference for 
domestic goods, construction projects and services from its Government procurement legislation?  
 Answer 
China's legislative organs will consider adjusting laws and regulations based on the negotiation. 
 Question 52 
Could China specify in which other pieces of legislation (both at national and local level) there is a 
provision for domestic preference?   WT/TPR/M/300/Add.1 
 
- 173 - 
 
  
 Answer 
Government shall purchase domestic goods, construction projects and services, this is the principle 
of Government Procurement Law. There are no detailed provisions or mandatory regulations. 
 
Question 53 Could China provide statistics about the number and value of contracts where the national 
preference has been applied?  
 Answer 
China has no government procurement contract with national preference for the time being. 
 
Question 54 Could China clarify how local certificates are issued, and what is the degree of national validity 
these certificates? How will the Chinese Government ensure uniform enforcement of legislation 
governing public procurement nationwide and equal access to information at the beginning of the bidding process?  
 
Answer 
Regarding the so-called local certificate, MOF is working with other departments to draft a management regulation on domestic goods procurement by government. There is no further 
information on that. The Management Method on Information Disclosure of Government 
Procurement (MOF Decree No. 19) gives detail re quirements on the information disclosure of 
government procurement, requiring organization participating in the tendering to disclose the 
tendering information and result at the designated media. Suppliers may obtain tendering 
information at government procurement website and other media.  
Suppliers with enquiry about government procurement may raise questions to the procurer or 
procurement agent. Those unsatisfied with the Answer may lodge complaint with financial body at their respective level. Currently, complaint handli ng includes four types: complaint overrules, 
procurement re-organization, alternative supplier selection, and identified illegal procurement; 
malpractice by procurer, agent and supplier are subject to warning, penalty and recorded in 
misconduct list; they may be prohibited from engaging in government procurement in 1-3 years. The decision of government procurement complaint shall be disclosed by law at government 
procurement website and other designated media. Suppliers may lodge civil lawsuit to the People's 
Court by law if their rights is compromised.  
Page 108, paragraph 3.193  states that "Bidders, if unfairly excluded from procurement 
processes or treated in a discriminatory way, may complain to the procuring agency, appeal to the Government Procurement Division of the Ministry of Finance, or subsequently file a complaint with a court. According to information provided by the authorities, in 2011, the finance authorities at 
various levels all over China accepted 521 complaints raised by suppliers against government 
procurement."  
Question 55 
Could China provide details on the existing re medies system in the field of government 
procurement? How many complaints have been fi led? What was the outcome and follow-up of the 
filed complaints? Where the aggrieved tenderers remedied and if yes, how?  
 Answer 
Suppliers with enquiry about government procurement may raise questions to the procurer or 
procurement agent. Those unsatisfied with the Answer may lodge complaint with financial body at 
their respective level. Currently, complaint hand ling includes four types: complaint overrule, 
procurement re-organization, alternative supplier selection, and identified illegal procurement; 
malpractice by procurer, agent and supplier are subject to warning, penalty and recorded in 
misconduct list; they may be prohibited from engaging in government procurement in 1-3 years. The decision of government procurement complaint shall be disclosed by law at government 
procurement website and other designated media. Suppliers may lodge civil lawsuit to the People's 
Court by law if their rights is compromised.   WT/TPR/M/300/Add.1 
 
- 174 - 
 
  
 In paragraph 3.197 , it is reported that "China is currently an observer to the GPA. China applied 
for accession to the GPA on 28 December 2007 and its initial offer was circulated to Parties on 7 January 2008. Discussions dedicated to China's accession took place on multiple occasions 
during the 2008-2013 period. In November 2011, China submitted a second revised GPA accession 
offer to the WTO, covering local governments for the first time.  
 
Para 3.198 states  that "On 29 November 2012, China circulated its third revised coverage offer". 
Although a fourth revised offer was presented on 31 December 2013, Members encouraged China to submit a revised offer to respond to Parties' requests. At the December 2013 US-China Joint Commission on Commerce and Trade, China agreed to  submit a GPA offer with greater ambition in 
2014. 
 Question 56 
Could China provide details on the work of the Leading Group established for the purposes of 
China's GPA accession? Could China inform on when it plans to submit its revised GPA offer and whether it will extend coverage at sub-central level, lower thresholds and improve coverage of 
services?  
 Answer 
In November 2013, the State Council set up leadership working group for GPA negotiation to 
enhance organization of the negotiation. Vice premier Zhang Gaoli is the head of the group, Lou 
Jiwei, minister of MOF and others work as vice chairs. Group members include 24 ministries involved in government procurement, foreign trade,  foreign affairs, industries and other sectors. 
The leadership working group mainly lays out the overall strategy, deal with major issues during 
the negotiation and guide and supervise related partie s to engage in the negotiation. The office of 
the group is located in MOF. It undertakes daily work and submits proposals for the working group 
to discuss. The head of the office is Liu Kun, vice minister of MOF.  
 China has committed to submit a revised price offer in 2014 that is similar to other participants. Currently, China is trying to work out a price offer as soon as possible, MOF is requesting some 
departments to study the areas to be improved in  price offer and will submit a price offer at an 
early time. The specific time of submission and revised content is subject to domestic reform and inter-departmental coordination. 
 
Maritime transport   
Paragraph 4.115  reports the following: "The trade regime of maritime transport services in China 
has been described in detail in previous TPR reports and has remained largely unchanged."   Question 57 
Could China inform when an international ship registration system is going to be implemented and 
when will wholly foreign-owned international ship management enterprises be allowed to operate in China? Which steps have been taken or are being planned in terms of openings in the shipping 
sector, including the options for foreign-owned ships to move empty containers?  
 Answer 
Since 2013, the Ministry of Transport has launched p ilot projects on international ship registration 
system at Dongjiang Free Trade Port Zone of Ti anjin and China (Shanghai) Pilot Free Trade Zone. 
Breakthroughs and innovations of such a system are manifested in the following areas: proportion of capital contribution made by foreign businessmen who are the main registration body and the 
accreditation of the capital contribution made by foreign businessmen, examination and approval 
of sailors of foreign nationality to assume posts, importing from outside China and the age of vessel of foreign nationality on bareboat charter conditions. Since 18 September 2013, China has 
allowed foreign businessmen to establish wholly-fund ed enterprises in China (Shanghai) Pilot Free 
Trade Zone to engage in the business of inte rnational ship management. Since 2003, China has 
allowed operators of foreign international container liners to use the vessels (including those of 
foreign nationality) they operate to allocate and transport the empty containers they own or lease 
between coastal ports in China.   WT/TPR/M/300/Add.1 
 
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 Air transport 
 Paragraph 4.123  describes the August 2012 promulgation of a new regulation on computer 
reservation systems (CRS). Under this new framework some foreign companies have obtained 
formal license to operate the CRS market in China.  However, this license is limited to 5% of the 
global Chinese market, since it only covers international flights. Moreover, other barriers persist, 
such us the compulsory itinerary receipts, and the presence of the major operators in the sectorial 
regulator, hinder effective access to the market.   Question 58 
How does China envisage changing the legislatio n on Computer Reservation System in order to 
avoid discriminatory treatment of foreign providers?   
Answer 
Foreign providers do not face discriminatory treatment in their operation in China. On October 
2012, the Civil Aviation Administration of Ch ina (CAAC) issued and implemented the Interim 
Provisions on the Administration of Licenses for Sales Agencies Designated by Foreign Air 
Transport Enterprises within the Territory of China to Directly Enter and Use Foreign Computer Reservation Systems (CAAC order No. 214). Such provisions were formulated in accordance with China's WTO accession commitments concerning computer reservation system. To support the 
implementation of these interim provisions, at th e end of 2012, CAAC issued Procedures on the 
Administration of Licenses for Sales Agencies Designated by Foreign Air Transport Enterprises 
within the Territory of China to Directly Ente r and Use Foreign Computer Reservation Systems 
(Minhangyunfa [2012] No.7). When a sales agency designated by a foreign air transport enterprise 
needs to directly enter and use foreign computer reservation system, the foreign air transport enterprise should file application to CAAC in acco rdance with relevant regulations, and obtain such 
license with the approval of CAAC. CAAC does no t adopt discriminatory measures in market access 
of computer reservation system. Both domestic and international air transport enterprises can 
select on their own domestic and international CR S providers to provide reservation and ticketing 
services. 
 
Page 137, section 4.2.2.2 regulatory regime in the financial services  
 
Page 138 Para 4.54  refers to the situation of the shadow  banking sector and to non-performing 
loans following the Asian financial crisis.   
Question 59 
China has engaged in a series of reforms in the financial sector including some measures to rein in shadow banking. Could you elaborate on measures adopted so far, their objectives and impact?  
 
Answer 
The measures adopted include:  
1. All China's financial regulatory authorities are jointly researching in a comprehensive way the 
shadow banking, including the definition, caus e of formation, scale, characteristics, risk 
manifestations of shadow banking and regulatory policies;  2. The regulatory principles and measures have been gradually improved to better control the 
systematic risks of shadow banking. In addition, regulation measures on non-financial institutions 
which have financial functions, such as small-sum loan company, Internet financial company and pawnshops have been strengthened or are under active study;  3. The financial regulatory coordination mech anism on shadow banking has been effectively 
established, covering such aspects as information sharing, data statistics and coordinated 
regulation. Such a mechanism is established with the aim of improving regulation efficiency and avoiding repeated regulation, and its purposes in clude correctly recognizing the functions and risks 
of shadow banking, identifying the direction of standardized development of shadow banking, and 
promoting the sound development of financial market.   
At present, regulatory policies concerning all kinds of shadow banking institutions and business 
have been gradually improved; the coordination of the works on regulating shadow banking has 
been gradually strengthened; and the public and the mass media have a better understanding of China's shadow banking.  WT/TPR/M/300/Add.1 
 
- 176 - 
 
  
 Question 60 
Internet banking is evolving very quickly in China, including with new money market funds competing with regular banks' products.  
What regulatory measures do Chinese authorities intend to adopt to ensure sustainable 
development of this sector and proper risk management?   
Answer 
China actively supports and encourages the sound de velopment of the Internet finance. At present 
the regulatory authorities are researching and fo rmulating the guiding opinions on promoting the 
sound development of the Internet finance. The guiding opinions will raise specific regulatory 
requirements on the main business forms of the Internet finance including online bank and sales of 
money market fund through the Internet, establish and improve regulatory systems, and guard against business risks. In addition, the regulatory authority is preparing the establishment of China 
Internet Finance Commission, with the aim of stre ngthening the self-disciplined administration on 
various business forms of the Internet finance, and promoting the sound development of the Internet finance industry.  
 
Question 61 China has started to allow finance institutions to access the market, although in a very limited scope. Could China elaborate on whether there are any advances in speeding up the approval 
process (CBRC, PBOC, SAFE, CSRC) and making it more transparent? Do the Chinese authorities 
envisage opening the financial sector for foreign banking, securities and fund management enterprises, and increase access to the Bond Underwriting Market?  
 
Answer 
The Law of the People's Republic of China on Admi nistrative Licence specifies the basic principles 
and requirements on administrative licence approval. In financial sectors including banking, 
insurance and securities, China has formulated the licence approval process corresponding to specific business in accordance with relevant laws  and regulations, standardizing licensing process, 
streamlining the examination and approval process,  and increasing the transparency of licence. 
Speeding up the reform and opening-up in the financial sector constitutes an important part of 
deepening economic restructuring. China will further open to the outside world its financial sectors including banking, insurance and securities in lin e with the development of domestic market. China 
is willing to negotiate with EU on the specific co ntents concerning opening up under the framework 
of Doha round of negotiations.   
Section 4.2.2.2.2. Recent regulatory  changes in the Insurance sector  
 Chinese authorities are reported to work on a deposit guarantee insurance.   
Question 62 
Could China elaborate on the state of play and planned timeline? How many foreign insurance companies have been granted a licence to provide compulsory traffic accident liability insurance 
since the opening of this sector to foreign companies mid- 2012?  
 Answer 
Establishing a deposit guarantee insurance system and improving the withdrawal mechanism of financial institution by means of marketization is a focus of China in its efforts to deepen the financial reform in 2014. At present, all preparatory works for establishing the deposit guarantee insurance are basically ready. The next step is to  promote the introduction of such a system as 
soon as possible. By June 2014, a total of 13  foreign-invested insurance companies had been 
allowed to operate the business of compulsory traffic accident liability insurance for motor vehicles with the approval of China Insurance Regulatory Commission.  
 WT/TPR/M/300/Add.1 
 
- 177 - 
 
  
 Paragraph 4.69 
 Question 63 
Will the experience that foreign insurance compan ies have acquired abroad be taken into account 
or are they also considered as "new insurance companies" that are limited to basic insurance services?  
 
Answer 
Measures for the Hierarchical Management of Business Scope of Insurance Companies apply uniformly to both domestic and foreign-invested  property insurance companies and life insurance 
companies. For specific stipulations of the Measures, please visit: http://www.circ.gov.cn. 
 Para 4.93 Construction Services  
Individual foreign architects are currently not able to become Chinese-registered architects. China 
does not allow wholly foreign owned construction companies to engage in all construction projects. Wholly foreign-owned firms are allowed but the presen ce of foreign firms is limited to four specific 
segments, a situation reflected by China's GATS commitments. The WTO secretariat confirms that 
the Chinese construction industry is strong, gr owing and competent with 56 Chinese companies on 
the World Top 300. It appears to be in a position to compete and cooperate openly with foreign-owned companies.  
 
Question 64 Does China foresee a gradual opening of currently closed segments of its construction market, 
including residential buildings (real estate)? If confirmed, what is the timeline and for which 
segments? Does China have any plans to conclude mutual recognition agreements for professional services, including architectural services, and environment related services?  
 
Answer 
China believes that the opening of service indu stries among the WTO member countries will be 
conducive to the further development of service trad e. China is willing to participate in competition 
worldwide on a broader range. China is willing to  negotiate with EU on the further opening of 
construction market under the framework of Doha round of negotiations. At present, China is conducting discussion and research on mutual reco gnition of the qualification of architects with 
countries including Singapore and New Zealand. Ch ina is willing to actively promote the mutual 
recognition of qualifications among WTO member countries.   
Page 148, paragraph 4.95 
The Chinese grading system does not take into account experience by construction firms obtained outside China. Wholly foreign-owned firms are allowed but the presence of foreign firms is limited to four specific segments, a situation reflected by China's GATS commitments. Qualification 
requirements are applied on a national-treatment basis. However, qualifications are granted only 
to independent newly established legal companies and do not therefore take into account the qualifications acquired abroad by their parent companies (so-called "global track record"). Foreign 
firms must thus start from the lowest grade of qualification. In the case of merger and acquisition 
transactions, the grade qualification of the local company is re-assessed.   
Question 65 
When will China allow foreign-owned to take into account the qualifications acquired abroad by their parent companies (so-called "global track record")? Does China foresee that such convergence to international practice of acknowledging global experience only in specific segments 
of the construction market? If so, which segments? Does China foresee a change in the current 
rules implying that in the case of merger and acquisition transactions, the grade qualification of the local company is re-assessed?  
 
Answer 
China strictly observes the stipulations on the pr inciple of national treatment in its WTO accession 
commitments. The same qualification criteria apply to both foreign-invested construction 
engineering enterprises and domestic construction engineering enterprises. According to regulations on qualification management and requirements of qualification criteria, individual enterprise legal person is the main body subj ect to qualification assessment. The regulation WT/TPR/M/300/Add.1 
 
- 178 - 
 
  
 authority recognizes the performances of individual enterprise legal person (including 
performances in overseas market). However, it does not recognize the performances of the parent company and affiliated enterprise of the individu al enterprise legal person. Such a regulation 
applies to both domestic enterprises and foreign-invested enterprises.  
 In accordance with the requirements of Regulations on Administration of Foreign-Invested 
Construction Enterprises and other regulations, for the domestic construction enterprises 
purchased by foreign enterprises, which nature therefore become construction enterprises with 
foreign investment, the qualifications shall be grad ed according to the standards actually reached.  
 
Page 148, paragraph 4.95 
The overall resources and competencies of wholly foreign-owned construction companies are not recognized on an international basis. 
 
Question 66 Does China foresee a gradual abolition of requirements on minimal registered capital and assets, 
minimum yearly turnover, and minimum perman ent personnel kept present in China?  
 Answer 
At present, China is making revision to relevant qualification criteria. It plans to simplify 
requirements of criteria, adjust relevant qualification assessment indexes. Further adjustments will 
be made to the requirements for registered capital, assets and personnel. The new qualification criteria will further play their roles in standa rdizing and guiding the enterprise conducts and 
promoting the sound development of industry.  
 WT/TPR/G/300 - Government Report  
 
Page 8, section 2.3.3 : The EU notes that there is no reference to the decisions taken in the 
3
rd Plenum to explore the creation of Specialised IPR Courts and to enhance the transparency of 
judicial decisions.  
 
Question 67 Could China give indications on in the progress of the implementation of these decisions? Can it 
already provide details in this regard?  
 Answer 
In June 2008, the Outline of National intellec tual Property Strategy states to study the 
establishment of IPR appellate court. The Decision on Major Issues Concerning Comprehensively Deepening Reforms also calls to explore the establishment of IPR court, making IPR special court as a strategic tack of China. The Supreme People 's Court is working with related departments to 
properly promote the establishment of IPR court. The Proposal of Setting up IPR Court was passed 
in 6 June 2014. The details of setting up such IP R court is still being designed and planned. No 
further information can be provided for the time being. 
 
Paragraph 2.26  states that "[…] IPR infringements and the manufacturing or selling of 
counterfeiting commodities have been effectively suppressed." 
 
The EU commends China for the tremendous efforts made in this area, also through special campaigns under the efficient co-ordination of the National Leading Group on the Fight against Infringement and counterfeiting. However, counterfeit is far from being suppressed and continues 
to be a major problem, as indicated in the 2013 figures released by the General Agency of Chinese 
Customs on counterfeit confiscations (24,464 batches of faked products, 76 million items suspected of breaching IPRs, with 98% or article seized violating trademarks rights).  
 
Question 68 Is China considering carrying out a study on the impact counterfeit and piracy have on the Chinese 
economy? If yes, which authority would be in charge? What are the planned steps regarding 
improved enforcement of IPR laws?   WT/TPR/M/300/Add.1 
 
- 179 - 
 
  
 Answer 
Infringement and counterfeit malpractice have negative impact on national economy and 
consumers' legitimate rights and interests. The Chinese government attaches great importance to 
this issue. The impact factor and approach of infringement and counterfeit malpractice on economy 
shall be effectively measured to identify policy measures and improve enforcement against these illegal practices, and enhance cracking down on misconduct. But how to determine and assess the 
impact factor is a common issue faced by all. Currently, Chinese law enforcement department and 
research institute are working together on this.   Currently, China has promulgated laws and regulati ons on IPR protection, with more than a dozen 
judicial interpretation on trademark, copyright,  patent, GIs, trade secret, new plant variety, 
integrated circuit layout and design. Generally speaking, special taskforce shall be conducted on prominent IPR infringement and illegal practice. Meanwhile, long-term mechanism shall be actively 
promoted, including improving laws and regulations to make the law operable; promote 
information disclosure of cases involving administrative penalty by law, create black list of illegal enterprise and direct culprit, and set up credit punishment mechanism; strengthen the link 
between administrative enforcement and criminal jurisdiction and crack down on criminal activities 
by law; carry out social campaign to raise public awareness to IPR.  Paragraph 2.26  
The EU understands that the Chinese government is pushing forward the initiative to incorporate 
the outcomes of IPR protection against infringements and counterfeits into government performance evaluation system at different administrative levels.  
 
Question 69 Could China explain how will the outcomes of IPR protection be incorporated into the government 
performance evaluation system? When does the Chinese government expect this system to 
become effective?   Answer 
Since 2012, China has incorporated IPR protection  in the performance evaluation system. Each 
year, the Leading Group of the National Campaign Against IPR Infringement and Counterfeit Products work out special evaluation methodology and assess the performance of local 
government in cracking down against IPR infringement. The content of evaluation includes the 
accomplishment of special taskforce of the ye ar, regime and system improvement, public 
campaign and other long-term mechanism develo pment. The evaluation score will be outcome-
oriented.  
 Paragraph 2.27  The EU notes that the State Council Legislative Offi ce, finally, just published a notice calling for 
public comments on the draft revision of  China's Copyright Law (deadline: 05/07).  
 Question 70 
Could the government of China provide an indication of the timeline for its adoption? What areas 
of copyright will the changes focus on? Could the government of China indicate whether the evaluation of the new Trademark Law is on-goi ng and whether guidelines are being set up?  
 
Answer 
Based on summarizing the practical experience, Na tional Copyright Administration of the P.R.C 
drafted the Copyright Law (revised version for ap proval) and has reported it to the State Council 
for examination. After fully soliciting the opinions of relevant departments, industrial associations, 
organizations, experts and scholars, the Legislative Affairs Office of the State Council is soliciting  
the public opinions on the revised version of the Copyright Law through 
http://www.chinalaw.gov.cn. Next, the Legislative Affairs Office of the State Council will make 
further revision to the Copyright Law (revised version for approval) after soliciting the opinions and comments from different quarters and making inve stigations and research, and report the further 
revised version of the law to the executive meetin g of the State Council for deliberation. After the 
revised law is deliberated and adopted at the ex ecutive meeting of the State Council, the revised 
draft of the Copyright Law will be further discuss ed and revised by the Standing Committee of the WT/TPR/M/300/Add.1 
 
- 180 - 
 
  
 National People's Congress. That is why it is impossible to make sure at present which part of the 
Copyright Law will be revised and when the revise d draft of the Copyright Law will be adopted.  
In addition, State Administration for Industry and Commerce (SAIC) believes that the new 
Trademark Law plays a very satisfactory role in "p roviding better service for the party concerned, 
maintaining market order of fair competition and strengthening the protection of trademark 
rights." 
 
Paragraph 2.28   Question 71 
The Chinese trademark office has repeatedly registered marks which were similar to well-known 
trademarks and could therefore mislead the public.  Has this problem been addressed by the recent changes? Does China envisage reforms to 
accelerate the implementation of court rulings regarding modification of a company name?  
 Answer 
We are in the process of coordinating domestic agencies involved to generate proper details on this issue.  Page 9 section 2.3.4  on advancing energy conservation, pollution and restructuring"  
 
Question 72 Regarding the Clean Air Act, can China inform on the selection criteria and a list of companies 
whose production will be suspended.  
 Answer 
China hasn't promulgated the Clean Air Act for the time being.  Page 11, Paragraph 2.38 on the Investment Catalogue   
Question 73 
Could China inform if the Catalogue of Investment Projects Subject to Government Verification applies equally to both domestic and foreign investments and investors? What type of investment 
projects do not benefit from a simplification of verification procedures or devolution to lower levels 
of administration? When does China envisage redu cing further the number of projects subject to 
central-level verification?  
 
Answer 
In December 2013, the State Council issued the Notice of the State Council on Issuing the Catalogue of Investment Projects Subject to the Government Verification (2013), stipulating that 
the Catalogue of Investment Projects Subject to Government Verification applies equally to both 
domestic and foreign investment projects, thus greatly reducing the scope of projects subject to government verification. For specific project verification authority, please see the above-mentioned 
Catalogue. The Chinese Government works hard to relax restrictions on investment access, unify 
the laws and regulations applicable to both domestic and foreign investments, and further ease the foreign investment restrictions on certain industries and sectors.  
 
Page 11, Section 2.4.2 on reform of  the business registration system 
 Question 74 
Could China clarify whether the same measures and capital thresholds mentioned in paragraph 
2.39 apply to both domestic and foreign companies? In paragraph 2.40, can China provide information on the effect of the reform of bu siness registration on foreign enterprises?  
 WT/TPR/M/300/Add.1 
 
- 181 - 
 
  
 Answer 
The measures and capital thresholds mentioned in paragraph 2.39 apply to both domestic and 
foreign companies. The reform of business registration further promotes the investment from 
foreign enterprises. In the first five months of 2014, a total of 14,180 foreign-funded enterprises 
of various kinds were newly established, with a total investment of US$105.075 billion, registered 
capital of US$63.94 billion, and foreign capital contribution of US$52.44 billion, showing year-on-
year increases of 3.3%, 19.2%, 26.9%, 26.1% respectively.  
 Page 11 Section 2.4.3 on reform of stat e-owned enterprises and development of the 
non-public sector  
 
Question 75 Are the tax relief measures foreseen in paragraph 2.41 also available to state-owned enterprises? 
Are they also available to foreign enterprises established in China?  
 Answer 
The income tax, VAT and business tax in small-scal e low profit enterprise are all applicable to 
state-owned enterprise and foreign investment enterprise.   Page 14, paragraph 2.51 : This paragraph refers to the reform of financial institutions. Global 
audit firms should be able to hand over information on local clients to the regulators in their home 
countries.   
Question 76 
Could the government of China confirm that the process of reform of the financial sector will be done in a way that ensures overseas regulators' access to information on domestic Chinese 
companies for prudential reasons?  
 Answer 
Please identify the nature and the categories of "information" in your question.  
 
Page 14, para 2.52 : reference is made to "[…] the Opinions on the Reform of the Railway 
Investment and Financing System and the Accelerati on of Railway Construction to fully open up 
the market of railway construction, to encourage social capital to invest in building railways […]"  
 Question 77 
Can China provide precise indications as to how foreign capitals either in the form of FDI or 
through participation in tenders in public procurement are captured in the Opinions? In case of positive answer, how are the above opinions mainstreamed in the investment catalogue and in public procurement guidelines and bidding documents?  
 
Answer 
Since the reform of separating railway administ ration from operation in 2013, the State Council 
released a series of key measures to reform railway investment and financing regime and to 
accelerate railway construction. The State Council clearly requires that "the ownership and management right of inter-city railway, inner ci ty and suburban railway, railway for resource 
exploration and feeder railway shall be opened up to local governments and social capital". Related 
government bodies revise the Catalogue of Industries for Guiding Foreign Investment and work to draft Licensing Method for Railway Transport Entry, so as to standardize market entry of railway transport and create favourable condition for capi tal to be invested in railway construction.  
 WT/TPR/M/300/Add.1 
 
- 182 - 
 
  
 Page 17, Section 3.2 on promotion balanced  and sustainable development of trade and 
investment  
Question 78 
Could China provide more details on its activities and efforts to promote sustainable development?  
 
Answer 
We are in the process of coordinating domestic agencies involved to generate proper details on 
this issue.  
Page 19, paragraph 3.24 
 Question 79 
Could the government of China indicate policy initiatives that are planned to drive forward e-
commerce and test new initiatives?   
Answer 
The Chinese Government attaches great importance to the development of e-commerce. In 
August 2013, the State Council issued the Opinions on Implementing Relevant Policies to Support the Cross-Border E-Commerce Retail Export, in which policies on supporting customs supervision, 
export inspection, collection and settlement of fo reign exchange, cross-border payment service, 
taxation and credit system building were propos ed, and these opinions were implemented starting 
from 1 October 2013 in regions where conditions were permitted. In future, supervision authorities 
will promote the development of e-commerce from different aspects following the requirements of  
the Opinions of the State Council.   
Page 20 Section 3.3.1 optimizing the utilizat ion of foreign investment through further 
opening up   Question 80 
As regards the liberalization of air traffic rights, is there a general policy that provides for (gradual) 
liberalization? If so, is it available? If not, who and how decides on the liberalization of traffic rights with different partner countries?  
 
Answer 
The overall policy of China as regards the liberalizatio n of its air traffic rights is as follows: in line 
with the actual development of China's air traffic and the demands of international air traffic 
market, liberalize China's international air traffic market in an "active, progressive, orderly way 
with guarantee", so as to create conditions for the sustained development of China's international air traffic market. The specific measures are as follows: Civil Aviation Administration of China 
(CAAC) reaches relevant arrangements with the civil aviation authorities of other countries on 
liberalization of air traffic rights through bilateral consultations and/or negotiations.   
Page 22 Paragraph. 3.40 
The paragraph notes that China proactively speeds up infrastructure connectivity, accelerates its logistics and transportation cooperation with the countries along the "Silk Road Economic Belt" and 
the "Maritime Silk Road". The Silk Road should bring "new opportunities and a new future to China 
and every country along the road that is seeking to develop."   Question 81 
How will this vision be implemented? Are there connected schemes, such as a regional free trade 
zone incorporating all the Silk Road countries? Could the government of China provide a state of play on the announced arrangements concerning the mutual recognition of investment funds 
between Hong Kong and mainland China? Can the government of China provide an initial overview 
of the types of investment funds covered by th is agreement and indicate a timetable for its 
conclusion?  
 WT/TPR/M/300/Add.1 
 
- 183 - 
 
  
 Answer 
"One Belt, One Road" is an open and inclusive economic cooperation initiative raised by the 
Chinese Government against the background of profound economic globalization and regional 
economic integration. It doesn't limit to certain countries, it is not an entity, and it is not a closed 
mechanism. Any willing countries and economic entities are welcomed. Infrastructure interconnectivity is key to "One Belt, One Road".  B a s e d  o n  a c t u a l  c o n d i t i o n s ,  w e  w i l l  w o r k  t o  
promote a batch of key cooperation project with consensus and sound foundation. The project will  
be promoted one by one according to their maturity. Free trade zone is key to promoting an orderly and free flow of factors, efficient distribution of resource and deepened market integration. We are willing to develop free trade relation with countries and regions along the economic belt. 
 
Pages 24, paragraph 3.593.4.4 Enha ncing South-South cooperation 
 
The EU notes with interest the information rega rding Aid for Trade (AfT) in the Government of 
China's (GOC's) report. Moreover, inter alia in the context of the WTO Committee on Trade and Development's session on AfT and its work pr ogramme for the coming biennium 2014-2015.  
 
Question 82 The EU would be grateful if the GOC could prov ide additional details on China's Aid for trade 
regime. In particular, information relating to recipient countries, amounts, purpose and duration of 
Aid for trade activities would be very appreciated with a view to get a better understanding of 
China's growing contribution in this area.   
Answer 
China has actively supported "Aid for Trade Regime" with practical actions since this initiative was 
launched by WTO.  
First, helping the LDCs to participate in multi-lateral trading system. Since 2008, China has made 
donations to WTO each year for the work of "Aid for Trade Regime." Since 2011, China has set up "China Programme" by using the donation for help ing the LDCs to access to the WTO. Up to now 
China has successfully held two "China Round Tables on WTO Accession for Least Developed 
Countries."  
Second, helping the LDCs to improve their produc tion capacities and promote trade development. 
China provides aid to relevant countries in pr oductive construction projects, improve their 
production capacities, expand trading scale and optimize trading structure.  
Third, improving market access and expanding exporting of products. It is honoring its 
commitments on giving zero-tariff treatment to relevant LDCs.  
Fourth, increasing its investment and improving infrastructure construction. China will continue to 
increase its investments in developing countries and LDCs, while aiding to build various large and medium-sized infrastructure construction projects, so as to help improve the conditions of transportation and application of information technology in the LDCs. In future, China will 
continue, to the best of our abilities, to provide aide for trade for LDCs. 
 Page 24, paragraph 3.60  
The government of China's (GOC's) report indicates that 35 LDCs with diplomatic ties with China 
receive unilateral tariff reduction from it under the Enabling clause. However, the WTO Secretariat's report, in section 3.20, page 61, states that Chinese authorities noted "…that as of 
1 July 2013, 30 out of 37 LDCs enjoy duty-free treatment on 95% of all tariff lines…".  
 Question 83 Are there any data available covering all the bene ficiaries of the duty-free preferences? According 
to an announcement made at the BRICS Leaders-Africa Dialogue Forum in March 2013, China 
intends to bring the coverage of duty-free treatmen t to 97% of tariff lines. Which sectors will be 
added to the current 95%, so to achieve the declared result? Beyond the preferences provided to 
LDCs, does China intend to provide unilateral preferences under the Enabling Clause to other 
developing (non-LDC) countries?   WT/TPR/M/300/Add.1 
 
- 184 - 
 
  
 Answer 
Since 1 January 2014, China has granted duty free treatment of 95%tariff lines to 35 LDCs that 
have diplomatic relation with China. There is no further data for the time being. China is studying 
how to add new products on top of the 95% tariff lines. In addition to favourable treatment to 
LDCs, there is no single-sided favourable plan fo r other developing countries (LDCs) for the time 
being.  WT/TPR/M/300/Add.1 
 
- 185 - 
 
  
 18  QUESTIONS BY THE UNITED STATES 
Part I: Questions regarding the Secretariat Report (WT/TPR/S/300) 
 
SUMMARY 
 Question 1 
WT/TPR/S/300, page 10, paragraph 12 : The Secretariat's report discusses the numerous 
Chinese government Catalogues that guide the implementation of central government, sub-central government and sectoral five-year plans. It then states: It is not always clear how different Catalogues should be read, as they sometimes ov erlap and even conflict, reflecting the different 
agendas at the different levels. Can China provide clarification regarding the legal authority of its 
Catalogues and how they interact with other kinds of policy documents issued in China, such as 
five-year plans and the innumerable measures  that implement those five-year plans?  
 
Answer 
Currently, China has formed a relatively sound planning system in which the numerous plannings 
are connected to, collaborated and unified with on e another. The overall planning in China is a 
strategic, outline-type comprehensive planning prop osed by different levels of governments for the 
economic and social development, which mainly se ts out the functional matters of the government 
authorities, whereas special plannings, regional  plannings and other development plannings are 
drafted and revised mainly pursuant to the overal l planning. Although the plannings of the State, 
provinces and cities have different highlights and authority, they are fully connected with each other and subject to extensive comments during their drafting, and then promptly made public 
upon deliberation and adoption by the corresponding people's congress at different level, so there 
is no such issue as being too many levels or being non-transparent.  
With respect to industrial plannings, the Chinese Government guides industrial development by 
Guiding Catalogues that treat various types of ma rket players fairly, equally and openly and are 
amended in light of the implementation at appropriate times.  
At the next stage China will adhere to the spirits of the 18
th CPC National Congress and the Third 
Plenary Session of the 18th CPC National Congress, let the market play a decisive role in resources 
allocation and let government play better roles, and push forward the constant reform and 
innovation of the Chinese planning system to further improve it. 
 Question 2 
WT/TPR/S/300, page 10, paragraph 13  
In paragraph 13, the Secretariat's report states: China encourages direct inward FDI as well as joint ventures between Chinese and foreign companies, particularly with regard to R&D activities. FDI is directed towards the areas in which China has a strategic interest. FDI has been encouraged 
in areas such as high-end manufacturing, high-tech industries, service industries, new energy and 
energy-saving environmental protection industries. Foreign investment projects are classified in 
four categories: encouraged, permitted, restrict ed, and prohibited. Projects in the encouraged 
category are eligible for preferential treatment as specified in the relevant laws and regulations, 
while projects in the restricted category must undergo a more thorough examination and approval 
process.  
 
a) In the context of China's efforts to direct investment to areas where China has a 
strategic interest, including high-tech indu stries, please explain what preferences 
China gives to companies that have conducted R&D in China or that own their IP in a 
Chinese company.  
 Answer 
Pursuant to Article 28 of the Law of the People's  Republic of China on Enterprise Income Tax and 
Article 88 of the Regulations for the Implementation  of the Law of the People's Republic of China 
on Enterprise Income Tax, high and new technolo gy enterprises that require key state support are 
subject to the applicable enterprise income tax rate with a reduction of 15%. High and new 
technology enterprises that require key state supp ort refer to those enterprises that have core 
IPRs and meet the following conditions: products (services) belong to the scope provided in the WT/TPR/M/300/Add.1 
 
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 High-tech Fields with Key State Support; the proportion of R&D expense in sales revenue is not 
below the required proportion; the proportion of revenue from high-tech products (services) in 
total revenue is not below the required proportion, the proportion of technicians in total employees 
is not below the required proportion; and other conditions set forth in the Measures for the 
Administration of High-tech Enterprise Identification. Therefore, enterprises (including foreign-invested enterprises that engage in R&D activities or have IPRs in China) that are identified as 
high-tech enterprises in China enjoy enterprise  income tax rate with a reduction of 15%. 
 Pursuant to Article 30 of the Law of the People's  Republic of China on Enterprise Income Tax and 
Article 95 of the Regulations for the Implementation  of the Law of the People's Republic of China 
on Enterprise Income Tax, weighted deduction of 50% may be computed in taxable income for 
research and development fees incurred by ente rprises in the development of new technology, 
new products and new skills that are not included in current profit and loss as intangible assets, 
and such research and development fees incurred as intangible assets are amortized by 150% of 
intangible asset costs.   
Self-use equipment imported within aggregate investment of encouraged foreign investment 
projects meeting the Catalogue for the Guidance of Foreign Investment Industries are exempted from custom duties except goods listed in th e Catalogue of Imported Goods Denied by Tax 
Exemption for Foreign Investment Projects.  
Above-mentioned preferences impose no restrictio n on domestic and foreign-funded enterprises, 
but are applicable to qualified resident enterp rises including foreign-invested enterprises.  
 
b) For purposes of such preferences, would the Chinese government treat a foreign 
company that owns Chinese IP, such as a patent granted in China, in a foreign country the same as Chinese companies that own their Chinese IP in China? Please explain.  
 
Answer 
Pursuant to the requirements of the Decision of the State Council on Accelerating the Cultivation and Development of Strategic Emerging Industries, China supports the creation and application of 
IPs, strengthens IP protection and administration, encourages enterprises to form a patent 
alliance; improves a system of protection to ensu re that colleges, universities, and scientific and 
research institutions can transfer and transform their IPs and achieve economic benefits, establish 
an efficient IP evaluation and trading mechanism; and grant more rewards to persons and entities 
making innovative achievements of significant social benefits. The Chinese government treats equally the domestic companies and the foreign comp anies in respect of its policies to support the 
development of strategic emerging industries. 
 Question 3 WT/TPR/S/300, page 12, paragraph 25  
In paragraph 25, the Secretariat's report states: The extent to which China supports exports and 
the different sectors of the economy is not clear; specific information regarding this was not provided to the Secretariat in the context of this Review. In addition, China's most recent 
notification (2011) to the WTO SCM Committee covered the period of 2005-2008 and the latest 
(2014) notification to the Agricultural Committee, in which China states that it did not maintain export subsidies, covered the year 2012.  
 
a) Given that a principal objective of the Trade Policy Review Mechanism is facilitating the 
smooth functioning of the multilateral trading system by enhancing the transparency of Members trade policies, can China please explain the circumstances that resulted in 
not providing the Secretariat information regarding how it supports exports and 
different sectors of its economy?   
Answer 
Capacity constraint is the major factor affecting th e timely notification of China's support programs 
in different sectors of the economy. The tremendous challenges China faces in preparing 
notifications under the SCM Agreement include not only the horizontal and vertical collection of 
information within the huge government hierarchy, but also the pains-taking sorting-out of interrelationship of various specific policies that may exist under a same support program. Furthermore, analysis must be made in terms of whether a particular support program should be WT/TPR/M/300/Add.1 
 
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 subject to the notification obligation, and accura te translation has proved to be another major 
problem. However, prohibited export subsidies ar e rarely detected now in China compared with 
years before as rules of the WTO in this regard are better understood by governments at various 
levels a decade after accession. Members can info rm China if they encount er prohibited export 
subsidies.  
b) As the largest trader among WTO Members, China's subsidies policies are of particular 
importance. When will China provide a subsidies notification covering the years 2009-2013 to the WTO SCM Committee?   
Answer 
China has been working hard on preparing the next subsidy notification since the last trade policy 
review, and is trying to finalize its submission as soon as possible. 
 
c) Will China's next subsidies notification for the first time include sub-central 
government subsidies? In the United States view, the importance of Chia notifying 
sub-central government subsidies is highlighted by the fact that, to date, hundreds of 
China's sub-central government measures ha ve been challenged in WTO disputes as 
the sources of prohibited subsidies.(See China Grants, Loans and Other Incentives  
(DS387) and China Certain Measures Affecting the Automobile and Automobile-Parts 
Industries  (DS450).) (DS387)(DS450)  
 
Answer 
Sub-central government programmes will be included in the next notification.  
 
d) In October 2012, the United States submitted a request (G/SCM/Q2/CHN/46, 
29 October 2012) to China under Article 25.8 of the SCM Agreement for information 
regarding numerous support programs, which, in the United States view, China should have notified to the SCM Committee as subsidies. Article 25.9 of the SCM Agreement provides that Members that have received a request under Article 25.8 shall provide 
such information as quickly as possible and in a comprehensive manner. To date, 
China has not responded to the questions set forth in the United States request. When will China respond to these questions?  
 
Answer 
Information provided by the U.S. will be fully consid ered in the course of China's preparation of its 
next subsidy notification. China will be in a better position to clarify details of the US submission 
G/SCM/Q2/CHN/46 after finalizing its notification.   Question 4 
WT/TPR/S/300, page 12, paragraph 26  
In paragraph 26, the Secretariat's report states: China maintains a large number of support programmes at the sectorial, regional and enterprise level. The application of these programmes is 
not always transparent. A full identification of these programmes was not possible for the 
Secretariat in the context of the current Review, as specific support measures are often the result of internal administrative measures that are not always easy to identify and generally only 
available in Chinese. In addition, the budget is not a public document hence it is not possible to 
identify outlays. In several other parts of its report, the Secretariat similarly raises concerns about its inability to conduct the review mandated by the Trade Policy Review Mechanism because China either has not published relevant trade-related measures or has not made translations of them 
available in one or more WTO languages.  
 
a) In paragraph 2(C)(2) of Part I of its WTO Protocol of Accession, China committed to 
publish in a single official journal all laws, regulations and other measures at both the 
central and sub-central government levels pertaining to or affecting trade in goods, services, trade-related intellectual property rights or the control of foreign exchange. 
Please explain when China will fully implement this important transparency 
commitment.  WT/TPR/M/300/Add.1 
 
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 Answer  
The Chinese Government attaches great importan ce to its transparency commitment and takes 
measures actively to fulfill its obligations. So far we have achieved following positive results:  
The central government confirmed China Foreign Trade and Economic Gazette as the official 
journal. In June 2002, the State Council published Official Reply of the General Office of the State 
Council to the Relevant Issues Concerning China's Implementation of the Transparency Clause of 
the Protocol of the WTO (Guo Ban Han [2002]42), confirmed China Foreign Trade and Economic  
Gazette (hereinafter referred to as the "Gazette") as the official journal to assist the notification and Trade Policy Review. The former Ministry of Fo reign Trade (later the Ministry of Commerce) is 
responsible for Gazettes editorial work with the support of local governments and departments of 
the State Council. In March 2006, the State Council promulgated Notice of the General Office of 
the State Council on Doing Well the Work Relevant to the Implementation of Transparency Provisions of China's WTO Accession Protocol (Guo Ban Fa [2006]23), reiterating that the Gazette 
is the government-confirmed journal that publis hes all existing rules, regulations or other 
measures that pertaining to or affecting trad e in goods, services, trade-related intellectual 
property rights or the control of foreign exchange. MOFCOM is responsible for editing and 
publishing, therefore it is required that all th e departments of state council and local governments 
to inform MOFCOM the above mentioned rules,  regulations and other measures when they 
promulgate them or consult the public on the drafts, in order for MOFCOM to publish them in the Gazette immediately. 
Thanks to the strong support of all the departme nts and local governments, from the end of 2002 
to May 2014, the Gazette has published 923 issues, including 5266 documents (196 of them are drafts). 
 
b) In paragraph 334 of the Working Party Report accompanying its WTO Protocol of 
Accession, China committed to make available translations of all laws, regulations and 
other measures at both the central and sub-central government levels pertaining to or 
affecting trade in goods, services, trade-related intellectual property rights or the control of foreign exchange into one or more of the official WTO languages. Please explain when China will implement this  important transparency commitment.  
 
Answer 
At present, institutional arrangements have been made regarding the translation of Chinese laws 
and regulations and other measures, and the translation work has been moving forward. The 
Legislative Affairs Commission of the State Council regularly publishes the Laws of the People's Republic of China (English Edition), and the Legal Affairs Office of the State Council regularly 
publishes Laws and Regulations of the People's  Republic of China Governing Foreign-related 
Matters in both Chinese and English. On 24 February 2003, the general office of the State Council issued the Notification on the Review of the Official English Translation of Administrative Laws and Regulations, requiring local governments and departments to do a good job at the translation and 
review of local government rules and departmental  rules. Despite constraints on administrative 
resources, the Chinese government will fulfill its WTO accession commitments, and spares no efforts in the translation of laws and regulations and continues to improve legislation transparency. 
 
1 ECONOMIC ENVIRONMENT  1.1 Recent Economic Developments  
1.1.4 Balance of payments  
 Question 5 WT/TPR/S/300, page 25, paragraph 1.39  
The Secretariat's report states: The ratio of the current account surplus to GDP also dropped from 
4% in 2010 to 1.9% in 2011, 2.3% in 2012, and 2% in 2013. In China's view, what are the near-term projections for the ratio of the current account to GDP?  
 
Answer 
The ratio of the current account to GDP in China will remain at a relatively low level within a 
reasonable scope of the international standard.  
Firstly, there is a stable surplus in commodity tr ading. On the one hand, steady global economic 
recovery is favorable to the improvement of export demands in China; on the other hand, the rise WT/TPR/M/300/Add.1 
 
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 of prices of labors and other production factors in China will increase export costs while expansion 
of domestic demands and other control measures will increase import demands.  Secondly, the deficit of trade in services will fu rther enlarge, especially the tourism sector as 
consumption by the Chinese citizens traveling and studying abroad is still going up and will 
continue to grow.  Finally, since Chinese foreign assets are mainly foreign exchange reserves and Chinese foreign 
liabilities are mainly direct investments, there conti nue to be a relatively big deficit in investment 
return and it will take a long term to adjust th e structure of foreign assets and liabilities in the 
future.  
1 ECONOMIC ENVIRONMENT 
1.1 Developments in Trade and Development  1.2.2 Trade in services  
 
Question 6 WT/TPR/S/300, page 31, paragraph 1.50  
China has experienced considerably less success in growing imports and exports for 
communications services during the 2009-2013 period according to Table 1.4. Why did China not achieve greater trade expansion in this services se ctor during this period? What reforms is China 
considering to achieve better trade performance for this services sector in the future?   
 
Answer 
China has maintained almost the same trade growth rate in telecommunication industry as the 
overall expansion of service trade. In future, Ch ina will promote the trade of its telecommunication 
industry in a planned way by integrating the impl ementation of the Strategy of Broadband China, 
the development of 4G business and transformation  and upgrading of telecommunication industry.  
 
2 TRADE AND INVESTMENT REGIME  2.1 Institutional and legal framework   
Question 7 
WT/TPR/S/300, page 35, paragraph 2.4  
Paragraph 2.4 mentions China's judicial system. During the past two years, has China taken any 
steps to promote judicial independence, i.e., the ability of Chinese judges to make decisions 
without interference from officials from People's  Congresses, Communist Party officials, officials 
from Communist Party committees, officials from central government ministries, local government 
officials and officials from the procuracy? Is the United States understanding correct that the 
Decision issued following the Third Plenary Session of the 18
th CPC National Congress (Third 
Plenum) in November 2013 calls for the promotion of greater judicial independence? If so, what 
steps have been taken or are planned to be taken to promote greater judicial independence?  
 
Answer 
Deepen the judicial system reforms, speed up the development of a just, efficient and 
authoritative socialist judicial system, protect people 's rights and interests, and let the people feel 
justice and fairness in every judicial case.  
Ensure the independent and just exercise of adjudicative and procuratorial powers in accordance 
with the laws. Reform the judicial administrative system, push forward uniform administration of the personnel, financial and material resources in local courts and procuratorates below the provincial level, and explore and establish a judi cial administrative regime that appropriately 
separates from administrative regions so as to ensure the uniform and correct implementation of 
national laws.  
Improve the judicial power operational mechanism, optimize the allocation of judicial powers and 
functions, perfect judicial power mechanism of di vision of responsibility, mutual cooperation and 
mutual check, and strengthen and regulate the lega l supervision and social supervision of judicial 
activities. 
Make reforms to the adjudicative committee system, improve the accountability of the chief judge and the collegiate bench in handing cases, and let the judge's trial cases and the judges be WT/TPR/M/300/Add.1 
 
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 accountable. Clarify the functions of each level of  courts, and regulate the supervisory relations 
between the superior courts and the inferior courts.  
Question 8  
WT/TPR/S/300, page 35, paragraph 2.4  
The United States understands that, in June 2014, the Central Leading Group for Comprehensively 
Deepening Reforms, chaired by President Xi Jinping, approved the Framework Opinions on Issues 
Concerning Judicial System Reform Pilot and the  Work Plan for the Shanghai Municipal Judicial 
Reform Pilot. Please describe the judicial reforms set forth in these two documents. 
 
Answer 
Please refer to a released report of Officers of the Central Leading Group for Judicial System 
Reforms Answered Journalists Questions on Judicial System Reform Pilot on 15 June 2014,  
(http://news.xinhuanet.com/politics/2014-06/15/c_1111149887.htm) covering the reasons for 
judicial system reforms, the overall consideratio ns of the reforms, for what key and difficult 
problems did the Framework Opinions on Reforms propose reform directions, the reasons for and 
considerations of improving judicial accountability set forth by the Framework Opinions on Reforms 
and the Shanghai Reform Plan, measures for and significance of implementing classified administration over judicial personnel, how to select judges and procurators in the future, the considerations of and measures for pushing forward uniform administration of the personnel, 
financial and material resources in local courts and procuratorates below the provincial level, and 
the like.  
Question 9 
WT/TPR/S/300, page 36, paragraph 2.12  
In paragraph 2.12, the Secretariat's report discusse s the publication of draft laws, administrative 
regulations and departmental rules for public comment. In this regard, the United States notes 
that, in China's WTO Protocol of Accession, China committed to provide a reasonable period for comment to the appropriate authorities before trade-related laws, regulations and other measures are implemented, subject to limited exceptions. In addition, in furtherance of bilateral 
commitments made to the United States in connect ion with the U.S.-China Strategic and Economic 
Dialogue (S&ED), the National People's Congress  (NPC) announced in 2008 that it would publish 
draft laws on its website to solicit public comments. Subsequently, the State Council Legislative 
Affairs Office (SCLAO) published two measures in 2012, the Interim Measures on Solicitation of 
Public Comment on Draft Laws and Regulations  and the Notice on Related Issues Regarding 
Solicitation of Public Comments on Draft Departmental Rules , which provide, among other things, 
that draft laws, draft administrative regulations and draft departmental rules for which State 
Council leaders agree to solicit public comments are to be posted on the Legislative Information Website of the SCLAO for 30 days to solicit public comments.  
 
a) In a recent study, the U.S.-China Business Council (USCBC) reviewed China's 
performance in publishing draft trade-related laws for public comment during the period from January through December 2013.With regard to trade-related laws passed 
by the NPC, the USCBC study found that, out of 9 laws passed by the NPC during 
2013, drafts of only 6 laws had been posted on the NPC website for public comment during the drafting or revision process. Why were the remaining 3 draft laws not 
posted on the NPC website for public comment? 
 
b) With respect to trade-related measures issued by the Ministry of Commerce 
(MOFCOM), the USCBC study found that, ou t of 20 administrative regulations and 
departmental rules and 45 other trade-related measures issued by MOFCOM during 
2013, only 4 drafts were posted on the SCLAO website for public comment. Why were nearly all of the trade-related measures i ssued by MOFCOM in 2013 not posted on the 
SCLAO website for comment? 
 
c) With respect to trade-related measures issued by the National Development and 
Reform Commission (NDRC), the USCBC found that NDRC had posted none of its 
11trade-related administrative regulations and departmental rules and 114 other trade-related measures on the SCLAO website for public comment during 2013. Why WT/TPR/M/300/Add.1 
 
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 did NDRC not post any of its draft trade-related measures on the SCLAO website for 
public comment in 2013?   
d) With respect to trade-related measures i ssued by the Ministry of Industry and 
Information Technology (MIIT), the USCBC found that MIIT had posted none of its 8 trade-related administrative regulations and departmental rules and 127 other 
trade-related measures on the SCLAO website for public comment during 2013. Why 
did MIIT not post any of its draft trade-related measures on the SCLAO website for public comment in 2013?  
 
Answers (a-d)   
In accordance with the Circular on Work related to Post of Draft Departmental Rules on the 
Legislative Information Website for Public Comments (Guo Fa [2012] No. 582) released by the 
SCLAO of the State Council, drafts of departmental rules may be posted either on the Legislative 
Information Website or on the website of the drafting department for public comments. There is no requirement with respect to seeking public comm ents for regulatory documents. Therefore, in 
practice departments including NDRC posted drafts of departmental rules and related regulatory 
comments mainly on their websites for public comments in 2013. Those posted on the Legislative Information Website for public comments were mainly drafts of laws and administrative regulations reviewed. 
 
e) According to the USCBC study, the performance of many other central government 
ministries is similar. Going forward, what is China's plan for ensuring that central 
government ministries post their draft trade-related measures on the SCLAO website 
for public comment unless one of the limited exceptions applies?  
 
Answer 
There has been different understanding as to whether China has committed to publicizing draft 
laws, regulations and rules for solicitation of pub lic opinions. Despite of that, Chinese government 
has been enhancing transparency and encouraging pu blic participation in its legislation process. 
Ever since 2008, all draft administrative regulations have been publicized for public comments on 
the website of the legal affairs information of the Chinese government. In July 2011, the 
Provisional Method for Soliciting Public Opinions on Draft Laws and Regulations was revised, and 
the Notice on Soliciting Public Opinions on Draft Departmental Rules at the Website of Legal Affairs 
Information of the Chinese Government was issued. The notice required that all administrative regulations and departmental rules that are rela ted to economy and trade shall have at least 
30 days for public comments unless there are exceptional cases.  
 Question 10 WT/TPR/S/300, page 37, paragraph 2.13  
In paragraph 2.13, the Secret ariat's report discusses the China Foreign Trade and Economic 
Gazette , published by MOFCOM.  
 
WT/TPR/S/300 
 
a)  Can China confirm that the China Foreign Trade and Economic Gazette  is China's official 
journal, as envisioned by paragraph 2(C)(2) of Part I of its WTO Protocol of Accession?  
 
Answer 
Please refer to answer of Question 4.a. 
 
b)  Can China explain why only a limited number of trade-related laws, administrative 
regulations, departmental rules and other measures have been published in the China 
Foreign Trade and Economic Gazette ? 
 
Answer 
In early June 2012, MOFCOM published the work manual for the Gazette liaison persons, which elaborated China's transparency commitment duri ng its accession to the WTO and confirmed the 
Gazette as the Official Journal, introduced the practice used by the United States, Brazil and other countries to fulfill the transparency commitments, developed certain standards and coverage of WT/TPR/M/300/Add.1 
 
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 the liaisons submissions, refine the feed channels and methods. Thanks to the strong support of all 
the departments of the state council and local governments, the journal has been successful, 
which better fulfills China's transparency commitm ent. However, understanding on transparency 
and trade-related documents that needed to be published on Gazettes sometimes differs among 
some departments of the state council and local government .More efforts needed to strengthen the work to publish trade-related documents fully and timely on Gazettes. 
 
c)  Can China also explain how it determines which trade-related measures are to be 
published in the China Foreign Trade and Economic Gazette ? Is it left to the discretion of 
each ministry to decide whether to send particular trade-related measures to MOFCOM for 
publication in the China Foreign Trade and Economic Gazette ? Or, has responsibility been 
assigned to MOFCOM to obtain trade-related measures from other ministries and publish them in the China Foreign Trade and Economic Gazette ? Has the State Council issued a 
directive addressing the publication of trade-related measures in the China Foreign Trade 
and Economic Gazette ? Please explain.  
 
Answer 
The China Foreign Trade and Economic Gazette mainly includes several trade-related documents 
as follows: laws, decisions by NPC and its standing committee, legal explanations released by the standing committee of NPC; administrative regulations, decisions by the State Council; legal 
explanations released by the Supreme Court and the Supreme People's Procuratorate; local 
regulations, autonomous regulations, standalo ne regulations; departmental regulations, 
regulations released by local municipal governments; other measures which are related to or affect 
trade in goods, trade in services, trade relate d intellectual property right or foreign currency 
regulation, such as various regulatory documents, national, industrial and local standards, and issues and measures released in accordance with laws, legal regulations and rules; international 
treaties signed by China, such as FTAs, investment protection treaties, double taxation avoidance 
agreements, etc.; draft laws, legal regulations, ru les and other measures open for public opinion. 
In March 2006, the State Council published Notice of the General Office of the State Council on Doing Well the Work Relevant to the Implementation of Transparency Provisions of China's WTO 
Accession Protocol Guo Ban Fa [2006] 23, reiterating that the Gazette is the government-
confirmed journal that publishes all existing rules, regulations or other measures that pertaining to or affecting trade in goods, services, trade-relate d intellectual property rights or the control of 
foreign exchange. MOFCOM is responsible for editing and publishing, therefore it is required that 
all the departments of state council and local governments to inform MOFCOM the abovementioned rules, regulations and other measures when they pr omulgate them or seek public opinions on the 
drafts, in order for MOFCOM to publish them in the Gazette promptly. 
 
d)  What plans does China have for improving its implementation of the publication 
commitment set forth in paragraph 2(C)(2) of Part I of its WTO Protocol of Accession?  
 
Answer 
China will step up the publicity effort by make the coordinators and their departments, local 
municipal governments better understand the compliance to the transparency obligation and the 
China Foreign Trade and Economic Gazette relate d work, and holding periodically workshop for 
coordinators to summarize experiences, sharing information and improving work quality. 
 
Question 11 WT/TPR/S/300, page 37, paragraph 2.14  
Paragraph2.14 of the Secretariat's report states that draft trade-related regulations and 
departmental rules must be published for public comment and that the public comment period 
must be not less than 30 days. In making this statement, the Secretariat's report cites to the Legislation Law and two sets of implementing regulations issued by the State Council, the 
Regulations on Procedures for Formulation of Administrative Regulations and the Regulations on 
Procedures for Formulation of Departmental Rules , which entered into effect on 1 January 2002. It 
is the United States understanding that neither those measures nor two subsequent measures 
issued by the SCLAO in 2012the Interim Measures on Solicitation of Public Comment on Draft Laws 
and Regulations and the Notice on Related Issues Regarding Solicitation of Public Comments on 
Draft Departmental Rules actually require Chinese government agencies to publish draft trade-
related administrative regulations and departmental rules for public comment. While the 2012 WT/TPR/M/300/Add.1 
 
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 SCLAO measures, as opposed to the 2002 State Council measures, squarely address the matter of 
notice-and-comment procedures, they were not issued at a level to be binding on Chinese 
government agencies. In addition, the 2012 SCLA O measures do not provide that draft trade-
related administrative regulations and department al rules must be subject to a public comment 
period; rather, the solicitation of public comments is only required when State Council leaders agree to it. Is the United States' understanding correct? If not, and if China agrees with the 
assessment by the Secretariat's report that draft trade-related regulations and departmental rules 
must be published for public comment for a period that must be not less than 30 days, how does China explain the major gap between this oblig ation and the actions by Chinese government 
agencies as reflected in the recent study by the USCBC?  
 
Answer 
The United States understanding is incorrect. Firs t of all, according to WTO rules and China's WTO 
commitments, China has no obligation to solicit public comments on draft administrative 
regulations and departmental rules. Second, the Legislation Law and two sets of implementing 
regulations stipulate that public comments may be solicited for relevant draft laws, regulations and  
rules for the purpose of advancing scientific and demo cratic legislation. Finally, the Regulations on 
Procedures for Formulation of Administrative Regulations and the Regulations on Procedures for Formulation of Departmental Rules, which entered into effect in 2002, belong to administrative laws and regulations. China's administrative laws and regulations are formulated by the State 
Council in accordance with the Constitution and other laws and are binding upon administrative 
agencies nationwide at all levels. In July 2011, SCLAO revised its internal document the Interim Measures on Solicitation of Public Comment on  Draft Laws and Regulations and printed and 
distributed the printed and distributed the Notice on  Soliciting Public Opinions on the Departmental 
Draft Rules at the Website of Legal Affairs Information of the Chinese Government to all department legal agencies to explicitly require all departmental draft rules related to economy and 
trade except some individual case to be intensively published at the Website of Legal Affairs 
Information of the Chinese Government to solicit public opinions within a term no less than 30 days. The Interim Measures on Solicitation of Public Comment on Draft Laws and Regulations belong to SCLAO internal documents and are applicable to standardize public opinion solicitation 
for draft laws and regulations by SCLAO, and th e Notice on Soliciting Public Opinions on the 
Departmental Draft Rules at the Website of Legal Affairs Information of the Chinese Government is of guiding significance for all department legal agencies. As a matter of fact, all departmental 
regulation drafts except some individual cases so licited public opinions at the Website of Legal 
Affairs Information of the Chinese Government with a public comment period no less than 30 days.   
 
Question 12 
WT/TPR/S/300, page 39, Paragraph 2.27 : The Secretariat's report states: The Third Plenary 
Session of the 18
th CPC National Congress worked out a detailed roadmap and a time-frame for 
the implementation of the reforms. To this end, 330 major reform measures covering 15 areas 
have been set. Economic restructuring is expected to lead the overall reform effort. Can China 
explain how the so-called No.1Central Document, issued in January 2014, relates to the referenced Third Plenum reform measures?  
 
Answer 
The No. 1 Central Document was formulated in light of the spirits of the Third Plenary Session of 
the 18th CPC National Congress, which implements and deepens the spirits of the Third Plenary 
Session of the 18th CPC National Congress. The major contents and direction of the No. 1 Central 
Document are in compliance with those of the Third Plenary Session of the 18th CPC National 
Congress. 
 
Question 13 WT/TPR/S/300, page 39, paragraph 2.29 : The Secretariat's report notes that China is a 
participant in the Information Technology Agreement (ITA).  
 
a)  Does China provide duty free treatment to al l flat panel display devices designed for use 
with an automatic data processing (ADP) machine, i.e., flat panel monitors that have as a 
purpose operation with an ADP machine and are able to display signals or data from an ADP machine in a form that meets the requirements of the user?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
China provides duty free treatment to flat panel display devices, i.e., flat panel monitors under 
HS 8528.51, designed for use with an automatic data processing (ADP) machine under HS 84.71 
solely or principally. The nomenclature an d definition of HS 8528.51 are in line  
with the provisions of the World Customs Organization HS 2012 6-digit code.  
b)  Does China provide duty free treatment for flat  panel display devices that are designed for 
use with an ADP machine, but have other uses as well?  
 Answer 
The tariff classification and taxation of flat panel monitor are determined in accordance with whether it is used solely or principally for automatic data processing equipment.  
c)  Can China identify the tariff lines in its nation al tariff schedule for flat panel display devices 
that do not receive duty free treatment and conf irm that none of the products captured in 
those tariff lines is designed for use with an ADP machine?  
Answer 
According to the World Customs Organization HS 2007 and HS 2012, monitors other than flat 
panel monitor used solely or principally for automatic data processing equipment are classified under tariff HS 8528.59, with certain import tariffs. As the creation of new technology and multiple 
functions, whether specific products are classifi ed under HS 8528.59 will be determined by its 
major function in accordance with the method set by the World Customs Organization.  
Question 14 
WT/TPR/S/300, page40, paragraph 2. 32, and page78, paragraph 3.83 
In paragraph 2.32, the Secretariat's report notes that some changes or updates in laws or 
procedures appear to require updated or amen ded WTO notifications. In paragraph 3.83, the 
Secretariat's report summarizes the notification activities of China's SPS National Enquiry Point and notes the absence of notifications of measures regarding food and feed. In the United States view, China has failed to notify to the WTO numerous measures relating to significant plant, animal and 
food safety requirements and commodity standards, including revised measures, such as 
Administrative Measures of Production License for Animal Feed and Feed Additives , issued by MOA 
and effective as of 1 May 2012; Administrative Measures of New Feed and New Feed Additives , 
issued by MOA and effective as of 1 May 2012; Regulation on Product Approval Numbers for Feed 
Additive and Premix Feed (Amended Draft for Comments) , issued by MOA on 1 March 2012; 
Regulation on Feed and Feed Additive Import Registration (Amended Draft for Comments) ,issued 
by MOA on 1 March 2012; Guidance on Formulating Acceptable Daily Intake Limit (ADI Limit) of 
Pesticide , MOA Public Notice No.1825, effective as of 25 August 2012; Notice on Announcing and 
Soliciting Comments on Draft for Maximum Residue Limits of Avermectins and 63 Other Kinds of 
Pesticides in Food , issued by MOA on 25 March 2012; National Food Safety Standard for Maximum 
Residue Limits for Pesticides in Foods (GB2763), issued by MOH on 1 December 2012; 
Determination of Impurities in Raw Milk and Dairy Products (GB5413.30-2010), issued by MOH; 
Standard Regarding Nutritional Fortification Substances in Foods (GB14880-2012); Aquatic Product 
Processing Firm Hygiene Management Norms (GB/T23871 of 2009); Revised Maximum Residue 
Limits for Pesticides in Food (GB2763-2012); Dra ft Measure for Major Crop Seed Registration , 
issued by MOA on 27 February 2013; National Food Safety Standard Flavoring for Foods , issued by 
NHFPC (2013); National Food Safety Standard Food Additive Ethanol , issued by NHFPC (2013); 85 
Pesticides (MOANo.145), issued 10 October 2013; Order Banning the Entrustment and OEM 
Production or Repackaging Infant Formula Milk Powder (CFDA No.43), issued by CFDA on 27 
November 2013; Order on the Regulation of Supervision and Inspection of Infant Formula Milk 
Powder Processing Plants , (CFDA No.43),issued by CFDA on 27 November 2013; Safety 
Examinations of New Food Raw Materials (NHFPCNo.1), issued by NHFPC 12 July 2013; 
Administrative Measure of Veterinary and Non-Veterinary Prescription Drugs (MOA OrderNo.2), 
issued 11 September 2013; Dairy Import and Export Inspection and Quarantine Management 
(AQSIQ DecreeNo.152), issued 24 January 2013; Implementation of Dairy Import and Export 
Inspection and Quarantine Management Decree 152 (AQSIQ NoticeNo.53), issued 15 April 2013; 
Foreign Dairy Plant Registration Requirement (2013), issued by CNCA; National Food Safety 
Standard for Food Additive Marking (2013), issued by NHFPC; Notice for Further Enhancement of 
Inspection and Supervision of Imported Chilled Aquatic Products (AQSIQ Notice No.298) (2013); 
Food Additive Flavorings  (Compounded Flavours) (GB30616-2014), issued by NHFPC; No.1 WT/TPR/M/300/Add.1 
 
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 Revision of the Determination of Protein in Foods (GB5009.5-2010), issued by NHFPC; Revised 
Maximum Residue Limits for Pesticides in Food (GB2763), issued by NHFPC; Requirement on GMO 
Samples and Technical Information , issued December 2012.  
 
a)  When does China plan to notify the above-identified measures to the WTO?  
 
Answer 
China has been making notifications regarding the relevant technical transaction measures 
according to the TBT/SPS Agreement, and will conti nue to perform its obligation of notification of 
updates of the technical transaction measures in the future. With respect to the documents 
referred to in the Questions raised by the United States, it is hereby clarified and explained as 
follows: the Guidance on Formulating Acceptable Da ily Intake Limit (ADI Limit) of Pesticide, MOA 
Public Notice No.1825, effective as of 25 August 2012, was formulated based on transformation of 
the formation principles of ADI set out in the FAO/WHO Environmental Health Criteria 240 
"PRINCIPLES AND METHODS FOR THE RISK ASSE SSMENT OF CHEMICALS IN FOOD" and is not 
required to notify to the WTO. The Notice on Announcing and Soliciting Comments on Draft for 
Maximum Residue Limits of Avermectins and 63 Other Kinds of Pesticides in Food, issued by MOA 
on 25 March 2012, had been notified to the WTO Secretariat to seek WTO member comments, the notification number being G/SPS/N/CHN/522. The National Food Safety Standard for Maximum Residue Limits for Pesticides in Foods (GB2763-2012), issued by MOH on 1 December 2012, was 
an integrated version of the standards for residue limits for pesticides in foods published by China 
at the early stage; the Revised Maximum Residue Limits for Pesticides in Food (GB2763-2014), issued by NHFPC, added some standards for re sidue limits for pesticides in foods and some 
updated MRLs standards based on the 2012 version, which had been notified to the WTO, the 
notification number being G/SPS/N/CHN/600. The 85 Pesticides (MOA No.145), issued by MOA in October 2013, had been notified to the WTO Secretariat to seek WTO member comments, the 
notification number being G/SPS/N/CHN/635. Besides, China has not officially issued the 
Requirements on GMO Samples and Technical Information and the Draft Measure for Major Crop Seed Registration. The Administrative Regulations of Feed and Feed Additives (State Council Order 
No.609), the Administrative Measures of Production License for Animal Feed and Feed Additives, 
the Administrative Measures of New Feed and New Feed Additives, the Administrative Measures on 
Product Approval Numbers for Feed Additive and Premix Feed, and the Administrative Measures on Feed and Feed Additive Import Registration issued by MOA, were published on the websites : 
http://www.gov.cn, http://www.chinalaw.gov.cn, or  htpp://www.agri.gov.cn in accordance with 
China's legislative procedures to seek public comments before they were officially issued. 
 
b)  What steps is China taking to ensure that in the future all requirements from the 
codification of new commodity food standards and revisions to pesticide maximum residue tolerances to new certification requirements and control measures for feed and feed additives, to name a sampling of relevant requirements will be notified to the WTO for 
comment prior to adoption and enforcement? 
 Answer 
China has notified relevant measures in strict accordance with the TBT/SPS agreements. As of 
June 2014, China already notified to the WTO 1,200 TBT measures and 832 SPS measures. Some of measures that were not timely notified by Ch ina are in line with international standards, some 
slightly influence trade and others are attributed to translations of different versions or name 
changes to laws and regulations. China will, as al ways, fulfill its obligation of transparency in the 
future. Our clarifications and explanations for documents mentioned in the Written Questions from the United States are as follows:  
1. The Guidance on Formulating Acceptable Daily In take Limit (ADI Limit) of Pesticide, MOA Public 
Notice No.1825, effective as of August 25, 2012,  is stipulated based on guide rules for ADI set 
forth in FAO/WHO Environmental Health Criteria 240 PRINCIPLES AND METHODS FOR THE RISK 
ASSESSMENT OF CHEMICALS IN FOOD and is in consistency with international standards.  
2. Notice on Announcing and Soliciting Comments on Draft for Maximum Residue Limits of Avermectins and 63 Other Kinds of Pesticides in  Food, issued by MOA on March 25, 2012 already 
solicited opinions from WTO member states via WTO Secretariat numbered G/SPS/N/CHN/522.  
3. National Food Safety Standard for Maximum Residue Limits for Pesticides in Foods (GB2763), issued by MOH on December 1, 2012, is an integrated version of the trace standard of pesticide published before. The Revised Maximum Residue Limits for Pesticides in Food (GB2763), issued by WT/TPR/M/300/Add.1 
 
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 NHFPC adds some pesticide residue standards in food laws and some new MRLs standards based 
on the Version 2012. The pesticide residue standards involved and new MRLs standards were  
notified to the WTO numbered G/SPS/N/CHN/600. 
4. 85 Pesticides (MOANo.145), issued October 2013 by the Ministry of Agriculture already solicited 
opinions from WTO member states via the WTO Secretariat numbered G/SPS/N/CHN/635.  5. China has not issued the Requirement on GMO Samples and Technical Information and the Draft 
Measure for Major Crop Seed Registration.  
6. Determination of Impurities in Raw Milk and Dairy Products (GB 5413.30-2010) for measuring impurities of raw milk and dairy products was not notified to the WTO in consideration of its minor influence on trade. 
7. Standard Regarding Nutritional Fortification Substances in Foods (GB 14880-2012) was notified 
to the WTO on December 2, 2010 numbered G/SPS/N/CHN/353.  8. National Food Safety Standard Flavoring for Fo ods was notified to the WTO on February 7, 2013 
numbered G/SPS/N/CHN/545.  
9. National Food Safety Standard Food Additive  Ethanol was notified to the WTO on May 24, 2013 
numbered G/SPS/N/CHN/ 617.  
10. The Safety Examinations of New Food Raw Materials was notified to the WTO on December 12, 
2011 numbered G/SPS/N/CHN/ 510, which was renamed the Administrative Measures for Security Review of New Food Materials at the party group m eeting of former Ministry of Health pursuant to 
the Administrative Measures for New Resource F oods, without adjustment to core contents.  
11. National Food Safety Standard for Food Ad ditive Marking was notified to the WTO on 17 
November 2011 numbered G/SPS/N/CHN/ 480.  12. Food Additive Flavorings (Compounded Flavours) (GB 30616-2014) was notified to the WTO on 
May 24, 2013 numbered G/SPS/N/CHN/ 621.  
13. No.1 Revision of the Determination of Protein in Foods (GB 5009.5-2010) was not notified to the WTO in consideration of its minor influence on trade.  
14. Dairy Import and Export Inspection and Quarantine Management (AQSIQ DecreeNo.152) was 
notified to the WTO on March 23, 2011 numbered G/SPS/N/CHN/355.  15. The Foreign Dairy Plant Registration Requirement (2013) is not a new technological law or regulation, but a campaign of foreign imported diary plant registration launched by the AQSIQ 
pursuant to specific provisions of the Food Safety  Law OF The People's Republic of China, the Dairy 
Import and Export Inspection and Quarantine Management (AQSIQ Decree No.152), the Administrative Measures for Foreign Imported Food Plant Registration (AQSIQ Decree No.145) and 
the Announcement on Releasing the Implementation Catalogue of Foreign Imported Food Plant 
Registration (AQSIQ Announcement No.62 in 2013). All these laws and regulations were notified to the WTO.  
 
2 TRADE AND INVESTMENT REGIME 2.5 Foreign investment regime 2.5.1 Regulatory framework and market access 
 
Question 15 WT/TPR/S/300, page44, paragraph2.52 : According to the 2012 State Administration of 
Industry and Commerce (SAIC) Yearbook (at page 737), almost 2,000 administrative anti-
monopoly cases have been brought.   
a)  How many of these administrative case s have involved challenges under the Anti-Monopoly 
Law? How many of these administrative cases have involved the monopolization of 
technology under the Contract Law (e.g., regarding the monopolization of technology 
under Article 329) ?  
 
Answer 
Maybe these 2,000 administrative cases refer to cases of investigating unfair transaction behaviors 
by retail suppliers as stated in the 2012 State Administration of Industry and Commerce (SAIC) 
Yearbook (at page 737).   
The SAIC and its agencies have fulfilled their duties to intensify effort in case investigation. When 
investigating and handling monopolization cases, industry and commerce agencies equally treat various market players including SOEs and multinational corporations, investigate suspected monopolistic conducts and punish monopolistic conducts investigated by following the basic WT/TPR/M/300/Add.1 
 
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 principle of administration in line with law and legal procedures. To date, 35 cases have been 
brought by the SAIC and authorized provincial in dustry and commerce bureaus, including 15 cases 
through 2013. At present, the SAIC has suspende d its investigation on Beijing Shengkai Company 
suspected of monopoly in Brazil FIFA World Cup ticket sale and supervised its commitment 
fulfillment, and is now actively advancing invest igation on suspected abuse of market dominance 
by Tetra Pak.  
 
b)  Please explain how and for what reasons the Chinese government decides to prosecute an 
administrative case involving monopolistic conduct under the Anti-Monopoly Law versus 
the Pricing Law versus the Contract Law .  
 
Answer 
In accordance with the Anti-Monopoly Law, with respect to the conducts of the administrative 
organs abuse of their administrative powers to eliminate or restrain competition, anti-monopoly 
enforcement agencies may propose suggestions on settlement opinions to their superior authority according to law. 
 
c)  Please explain NDRCs role in using the Pricing Law in technology licensing cases that also 
implicate the Anti-Monopoly Law, Contract Law and potentially other laws and regulations, 
such as the Standardization Law . 
 
Answer 
In handling cases of abuse of IP rights to elim inate and restrain competition, NDRC applies the 
Anti-Monopoly Law rather than the Pricing Law. In specific enforcement practice, NDRCs major 
concerns are not the level of prices but whether the conducts of related business operators eliminate or restrain market competition. 
 
Question 16 WT/TPR/S/300, page45, paragraph2.54  
In paragraph 2.54, the Secretariat's report notes that WTO Members have expressed concerns 
about China imposing de facto technology transfer requirements. It states that, according to the 
Chinese authorities, WTO Members concerns are not consistent with the facts. The United States believes that forced technology transfer remains a significant problem in China. As explained in the 
2013 USTR Report to Congress on China's WTO Compliance, issued in December 2013, as USTR 
has reported previously, and as remains true today, confidential accounts from foreign enterprises indicate that Chinese government officials, acting without fear of legal challenge, at times require 
foreign enterprises to transfer technology as a condition for securing investments approvals, even 
though Chinese law does not and cannot under China's WTO commitments require technology transfer. The USTR report adds: In addition, a ccording to confidential reports from foreign 
enterprises, Chinese government officials may use informal means to require a foreign enterprise 
to conduct research and development in China, transfer technology, satisfy performance 
requirements relating to exportation or the use of local content, or make valuable, deal-specific commercial concessions if it wants its investment approved. In addition, certain measures issued 
by China, such as in the area of new energy vehi cles, effectively have required foreign enterprises 
to transfer their technology to their Chinese joint venture partners. Please explain how China justifies these policies and practices in light of its WTO Protocol of Accession commitments not to 
condition investment approvals on, among other things, the transfer of technology.  
 Answer 
China made commitments upon its accession to WTO that it would not use the condition of 
technology transfer to restrict foreign investments and has actually fulfilled its commitments not to 
condition governmental approvals on the transfer of  technology. It's the sole discretion of foreign 
companies and their Chinese partners to agree on technology transfer based on their negotiations 
and in light of their respective competitive advantages and business principles. 
 WT/TPR/M/300/Add.1 
 
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 2 TRADE AND INVESTMENT REGIME 
2.5 Foreign investment regime 2.5.4 China (Shanghai) Pilot Free Trade Zone (CSPFTZ)  
 
Question 17 WT/TPR/S/300, page52, paragraph 2.84  
Paragraph2.84 describes the so-called Negative List for the China (Shanghai) Pilot Free Trade Zone 
(CSPFTZ) and notes that the Negative List will be adjusted when deemed appropriate. Can China 
please provide additional information regarding the factors it will take into consideration when determining the appropriate timing for adjusting the Negative List? Additionally, can China please 
provide additional information about the criteria it uses in determining which services sectors or 
industries should be on the Negative List?   
Answer 
The Negative List will be adjusted when deemed a ppropriate in accordance with foreign investment 
laws and regulations, in light of the development needs of the CSPFTZ, and following the principles 
of enhancing liberalization, transparency and furthe r in line with international rules. Currently, the 
2013 Negative List is being amended and covers 18 sectors or industries of national economy (Except public administration, social security and social organizations and international organizations). The discriminative market access measures adopted in these sectors for foreign 
investment projects and foreign-invested enterprise incorporation are listed. 
 Question 18 
WT/TPR/S300, page53, paragraph 2.86  
The United States understands that China has established a pilot programme allowing there sale of mobile services. However, this opportunity is closed to foreign participation. The 17 partner firms 
chosen for the pilot programme are all Chinese firms, and the pilot programme specifically 
excluded foreign participation.   
a)  What was the basis for discriminating against foreign participants in this pilot programme?  
 
Answer 
Resale of mobile services is a new service in th e Chinese market and its market supervision is yet 
to be improved. China has launched the pilot programme for the purpose of exploring relevant 
market access and supervision policies regarding the business as an independent business type. China will open relevant services to other domestic and foreign-funded enterprises in the pilot 
programme in accordance with relevant laws and regulations when conditions are ripe .  
 
b)  How will China judge the success of this pilot programme? 
 
Answer 
We are now studying and formulating the methods of assessing the pilot programme. We are 
striving to achieve such results upon the comple tion of the pilot program that the supervision 
policies are complete, the market competition is fair, networks and information are safe, and the 
interests and rights of users are effectively guaranteed, so as to lay a foundation for the formal business operation of this service.  
 
c)  Can China confirm that it will liberalize the market for the resale of mobile services, and 
that it will open this market to foreign firms? If so, when?  
 
Answer 
When the resale of mobile services formally be comes an independent business upon the finishing 
of the pilot programme by the end of 2015, China w ill open this market to foreign firms according 
to relevant laws and regulations and China's commitment to the WTO. 
 
d)  Does China have plans to allow the resale of other (non-mobile) telecommunications 
services?  
 Answer 
No plan is available at present. WT/TPR/M/300/Add.1 
 
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 Question 19 
WT/TPR/S300, page54, Paragraph2.93  
Paragraph2.93 describes the market openings for the insurance services sector that China 
envisions for the CSPFTZ by refe rring to five decisions made by the China Insurance Regulatory 
Commission (CIRC), denoted (a) through (e) in the Secretariat's report.   
a)  It seems that the decisions described in item (a), in item (b) as it pertains to branches, in 
item(d) and in item (e) already are required as part of China's GATS commitments. Have 
we misunderstood? Which elements of these items are GATS-plus?  
 
Answer 
To give full play to the role of insurance and su pport the building of CSPFTZ, the CIRC specially 
issued the guiding opinions The China Insuranc e Regulatory Commission Supports building of 
CSPFTZ in September 2013 with a view to supporting and advancing insurance market 
development in the CSPFTZ. Five support measures in the opinions cover both foreign capital market access and overseas investment by Chinese-invested enterprises and go beyond China's 
WTO commitments.  
 
b)  What does China mean by specialized health insurance institutions? How does China define 
specialized? What specific liberalization does China plan for specialized health insurance 
institutions?  
 Answer 
A specialized health insurance institution should regard health insurance as its primary business. The China Insurance Regulatory Commission Support s only offers guiding opinions and specific 
detailed implementation rules are yet to be further developed.  
 
c)  When does China plan to open the life insu rance services sector to majority ownership a 
key reform not yet undertaken in the CSPFTZ?  
 
Answer 
Market opening process has been carried forward in a steady and progressive way in the Chinese 
insurance sector. The issue of equity ratio of Chinese foreign joint-venture life insurance 
companies exerts far-reaching influences. China is willing to negotiate with WTO Members on 
further opening of specific service sectors in the Doha Round Talk.  
3 TRADE POLICIIES AND PRACTICES BY MEASURE 
3.1 Measures Directly Affecting Imports 3.1.2 Customs valuation   
Question 20 
WT/TPR/S/300, page58, paragraph 3.9  
Paragraph 3.9 of the Secretariat's report discusses China's customs valuation regime. Can China 
confirm that it applies paragraph 2 of the Decision on Carrier Media Bearing Software and 
therefore values carrier media bearing software based on the value of the carrier media as opposed to the value of the software?  
 
Answer 
The value assessment and determination department of Chinese Customs enforces the Customs Law, the Regulations on Import and Export Du ties and the Measures for the Assessment and 
Determination of Duty-paid Value of Import and Ex port Goods. Article 34 of the Measures for the 
Assessment and Determination of Duty-paid Value of  Import and Export Goods explicitly states 
that "with regard to the imported medium that carries special software for data processing 
equipment, if it is under either of the followi ng circumstances, the duty-paid value shall be 
checked and determined in light of the value or cost  of the medium itself: (1) the value or cost of 
the medium itself is separately listed from the soft ware it carries; or (2) although the value or cost 
of the medium itself is not separately listed fr om the carried software, the taxpayer can provide 
the certification document on the value or co st of the medium itself, or can provide the 
certification document on the value of the software it carries. The preceding paragraph shall not apply to the medium containing fine arts, photographs, audio or video products, movies and WT/TPR/M/300/Add.1 
 
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 television programs, games and electronic journals." Chinese Customs principle is clear: when 
valuing Carrier Media Bearing Software, with the exceptions mentioned in Article 34, the duty-paid value is checked and determined in light of the value or cost of the medium itself. 
 
3 TRADE POLICIIES AND PRACTICES BY MEASURE  3.1 Measures Directly Affecting Imports  
3.1.4 Tariffs  
 Question 21 WT/TPR/S/300, pages 58-60, paragraphs 3.13-3.19  
In paragraphs 3.13-3.19, the Secretariat's report analyses China's bound and applied tariff rates. 
This analysis illustrates the importance of Members fulfilling the requirements to notify and to update tariff data. The United States notes that, in document TN/MA/S/23, the Secretariat 
explains that Members are required to update their bound schedules on goods to keep them in line 
with the most recent version of the Harmonized Sy stem (HS) currently used in their applied tariff 
regime. The WTO Committee on Market Access has engaged in a rigorous transposition exercise to 
ensure that all Members tariff commitments are up dated to the most recent HS nomenclatures and 
this exercise is complemented by a multilateral review of each Members transposition. While the current work in the Committee on Market Access is focused on the transposition of schedules from 
HS07, China is one of a handful of Members that has not yet completed its HS02 transposition. 
When does China intend to submit a new HS02 transposition schedule that responds to Members 
comments in order to advance the work in the Committee on Market Access? []  
Answer 
Under the framework of WTO Committee on Market Access, China keeps exchanging views with 
relevant members on questions or comments of the HS02 transposition. China thinks related 
questions are highly technical, and hopes to discuss with members face to face. China implements 
its commitments strictly on bound tariffs, and China is willing to discuss with members at technical level.  
3 TRADE POLICIIES AND PRACTICES BY MEASURE  
3.1 Measures Directly Affecting Imports  3.1.6 Import prohibitions, restrictions, and licensing  
 
Question 22 WT/TPR/S/300, page 64, paragraph 3.26  
According to the Secretariat's report, [t]here are a few products (i.e. machinery and electrical 
equipment) that are subject to both non-automatic and automatic import licensing.   
a)  Please explain why China requires two import licenses for these products in light of 
Articles 1, 2 and 3 of the WTO Agreement on Import Licensing Procedures? 
b)  What is the purpose of the automatic license for these products?  
c)  What is the justification for the non-automatic license?  
d)  How does China ensure that the administrative procedures used to implement the non-
automatic import licenses are in conformity with the relevant provisions of the GATT 1994?  
e)  What if an item that requires both licenses receives the automatic license but not the non-
automatic license? Is that item allowed access to China's market, or must the item be 
granted both licenses before the item is permitted to enter China's market?   
Answers (a-e)  
According to the relevant provisions of th e Foreign Trade Law, the Regulations on the 
Administration of the Import and Export of Goods, the Measures for Administration of Import of Electromechanical Products (Decree No. 7 [2008] of Ministry of Commerce, General Administration 
of Customs, General Administration of Quality Supervision, Inspection and Quarantine), the 
Measures for Implementation of the Automatic Import License of Mechanical and Electronic 
Products (Decree No. 6 [2008] of Ministry of Co mmerce and General Administration of Customs), 
and the Measures for Administration of Import of Specified Used Mechanical and Electronic 
Products" (Decree No. 5 [2008] of Ministry of Commerce, General Administration of Customs, General Administration of Quality Supervision, Inspection and Quarantine), China implements 
classified administration for mechanical and el ectrical products, namely, the mechanical and WT/TPR/M/300/Add.1 
 
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 electrical products are classified into three categories - free import, restricted import, prohibited 
import. China's administrative procedures are in full compliance with the WTO Agreement on Import Licensing Procedures. The Secretariat may have misunderstanding of that; in fact China 
never requires two import licenses for a product. 
The main purpose of automatic license is for the need of import monitoring, some mechanical and electrical products under free import category are subject to automatic import license. These 
products are listed in the Catalogue of Goods Subject to Automatic Import License. The mechanical 
and electrical products under restricted import category are subject to import license administration. Currently, all mechanical and electrical products under restricted import category are specified used mechanical and electrical products. These products are listed in the Catalogue of 
Goods Subject to Import License. 
 3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.1 Measures Directly Affecting Imports  
3.1.7 Anti-dumping, countervailin g, and safeguard measures  
 
Question 23 
WT/TPR/S300, page 66, paragraph 3.33  
The Secretariat's report describes China's legal framework for conducting anti-dumping investigations and applying measures. The United States notes that, in July 2013, China issued its 
Provisional Rules for Implemen ting WTO Trade Remedy Rulings . The United States further notes 
that China has subsequently conducted proceedings pursuant to that measure, including proceedings to comply with adverse WTO rulings in China Countervailing and Anti-Dumping Duties 
on Grain Oriented Flat-Rolled Electrical Steel from the United States  (DS414) and China Anti-
Dumping and Countervailing Duty Measures on Broiler Products from the United States  (DS427). 
When will China notify this measure to the appropriate WTO committees?  
 
Answer 
MOFCOM issued the Provisional Rules for Implementing WTO Trade Remedy Rulings on 31 July 2013. China will clarify whether this rule is in the scope of notification duties under WTO 
relevant agreements. If so, China will notify the relevant WTO committees of the Provisional Rules 
as soon as possible.  
Question 24 
WT/TPR/S/300, Page 66, paragraphs 3.33- 3.34 In paragraph 3.33, the Secretariat's report explains that China's main legislation with respect to 
anti-dumping was not modified during the period under review. In paragraph 3.34, the report 
describes the roles of MOFCOM's Bureau of Fo reign Trade for Imports and Exports (BOFT) and 
MOFCOM's Investigation Bureau of Industry Injury (IBII). The United States notes that, earlier this year, MOFCOM announced the consolidation of BOFT and certain divisions of IBII, resulting in a 
new entity, the Trade Remedy Investigation Bure au (TRIB), to oversee the conduct of trade 
remedy investigations.   
a)  Could China explain how and when it intends to implement these revisions to its legal 
framework for conducting trade remedy investigations, including any revisions to applicable laws, administrative regulations and departmental rules, to reflect the 
consolidation of the functions of BOFT and IBII into TRIB?  
 Answer 
The Ministry of Commerce will revise the department  rules on trade remedy in accordance with the 
needs of practice after the establishment of TRIB . The revision will not touch laws and regulations 
associated with trade remedy, since the consolidation optimizes the investigation procedures and improves the investigation methods rather than affect the relevant legal system. 
 
b)  Could China advise when it expects to notify the relevant WTO Committees of these 
revisions to its trade remedies regime?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
Currently, the revisions of the department rules ha ve been included in the rulemaking plan of 
Ministry of Commerce. After the completion of the revisions, China will promptly notify the relevant 
WTO Committees of these revisions. 
 
c)  Could China explain how the creation of TRIB will affect the manner in which China 
conducts its trade remedy investigations?  
Answer 
TRIB is established on the basis of the consolidat ion of BOFT and IBII, and its functions cover the 
functions of BOFT and IBII in the area of trade re medy investigation. This adjustment will further 
improve the efficiency of trade remedy investigatio n, reduce stakeholders' burden in litigation, and 
make the investigation procedures more optimized and proper. For example, all investigations concerning dumping, injury and causation are co nducted by a single division. The essence of 
China's trade remedy investigation system will no t be substantially affected by the adjustment. 
 
d)  Could China explain how TRIB will address past concerns raised by WTO Members with 
respect to transparency and due process in its trade remedy investigations?  
 Answer 
Since joining the WTO, Chinese Ministry of Co mmerce has been focusing on the issues of 
transparency and due process in trade remedy in vestigations, treating the issues concerned by 
other members seriously, and taking efforts to protect the procedural rights of all stakeholders in trade remedy investigations. TRIB will continue to  adhere to the principle of transparency and 
proper procedure to ensure the interests of all stakeholders in the investigations. 
 Question 25 
WT/TPR/S300, page 67, paragraph 3.40  
The Secretariat's report states that [i]n accordance with the anti-dumping regulations, the imposition of anti-dumping duties must be in the public interest. However, there are no rules 
specifying how to do this and, with the exception of price undertakings, the issue has not been 
explicitly included as a factor. Please explain why China has no rules specifying its methodology for 
applying the public interest test, and whether detailed rules will be issued soon, given the statement in paragraph 3.35 that [t]he Chinese authorities consider that the purpose of 
conducting anti-dumping investigations is to maintain a fair competitive environment and a normal 
trade order, and not to blindly protect domestic industries.   
Answer 
According to Article 37 of the Anti-Dumping Regula tions, imposition of anti-dumping duty shall be 
in the public interest. In an anti-dumping investigation, Chinese investigation authority holds hearings and meetings to allow all stakeholders, including manufacturers and exporters involved in 
the case, involved governments, upstream and downstream enterprises and related industry 
associations and importers, to express their views,  and seriously considers their demands, so as to 
ensure an objective, impartial and fair investigatio n. The investigation authority will review specific 
considerations case by case. 
 Question 26 
WT/TPR/S300, page 68, paragraph 3.44  
The Secretariat's report states: MOFCOM can deci de on the sampling of products to determine 
dumping and the margin of dumping if it finds that the number of types of product under investigation is too large. Has MOFCOM ever utilized this methodology in an anti-dumping 
proceeding? If so, which one(s)? Please also explain how MOFCOM has applied, or would apply, 
such a sampling methodology in an anti-dumping investigation.   
Answer 
According to the Provisional Rules on Sampling in  Anti-Dumping Investigations, if there are too 
many exporters, manufacturers, models, or deals in volved in an investigation, determination of 
the dumping margin for each exporter or producer or investigation of all product models or deals 
will bring heavy burden and prevent the timely co mpletion of the dumping investigation, so the 
investigation authority uses sampling in anti-dumping investigations. Ministry of Commerce used WT/TPR/M/300/Add.1 
 
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 product model sampling in the anti-dumping investigation on the cold rolled coils imported from 
ROK and the pulp imported from the United States, Canada and Brazil.  
Question 27 
WT/TPR/S/300, page 68, paragraph 3.46  
In paragraph 3.46, the Secretariat's report addresses Article 56 of China's anti-dumping 
regulations, which authorizes taking countermeasures when a trading partner discriminatorily 
imposes anti-dumping measures. (The United States notes that a similar provision appears in Article 55 of China's countervailing duty regulations,  which, like Article 56 of China's anti-dumping 
regulations, has its roots in Article 7 of China's Foreign Trade Law .)According to the Secretariat's 
report, China explained that it has not applied Article 56 of its anti-dumping regulations and that it 
would resort to WTO dispute settlement before taking corresponding countermeasures in respect of a WTO Member. The United States notes that, on several occasions in recent years, MOFCOM 
has stated that it will initiate anti-dumping and countervailing duty investigations of U.S. products 
if the United States takes actions adverse to Ch ina's interests in anti-dumping, countervailing duty 
or safeguard investigations, apparently with the de sign of discouraging the United States from the 
legitimate exercise of its rights under WTO an ti-dumping and countervailing duty rules or the 
safeguard provisions of China's WTO Protocol of Accession. In the United States experience, this type of retaliatory conduct is not typical of WT O Members. In addition, when MOFCOM has pursued 
anti-dumping and countervailing duty investigations under these circumstances, it appears that it 
has tended to move forward with the imposition of  duties even when there are significant flaws in 
the underlying legal and factual support, as has be en confirmed by WTO panel and Appellate Body 
rulings in China Countervailing and Anti-Dumping Duties on Grain Oriented Flat-Rolled Electrical 
Steel from the United States  (DS414), China Anti-Dumping and Countervailing Duty Measures on 
Broiler Products from the United States  (DS427) and China Anti-Dumping and Countervailing 
Duties on Certain Automobiles from the United States  (DS440). If China has not been applying 
Article 56 of its anti-dumping regulations (and Article 55 of its countervailing duty regulations) in 
these circumstances, can China identify the domestic legal authority pursuant to which MOFCOM initiated the anti-dumping and countervailing duty investigations that were subsequently the subject of DS414, DS427 and DS440? 
 
Answer 
China opposes the US claim that an anti-dumping or countervailing duty investigation conducted 
by Chinese investigation authority is a retaliatory conduct. Chinese investigation authority 
conducts such investigations based on application, factual evidence and according to laws. As a WTO member, China is entitled to  conduct trade remedy investigations on imported products 
allegedly involved in unfair competition under co nditions consistent with WTO rules and Chinese 
laws. Meanwhile, China respects the WTO disput e settlement mechanism and the rights of WTO 
Members under the mechanism, and abides by the rulings of Dispute Settlement Panel and Appellate Body. China's rights and efforts should also be respected and recognized by other WTO 
members. For DS414, DS427 and DS440 mentioned by the United States, China has launched an 
re-investigation and made a ruling, respectively, according to the Anti-Dumping Regulations of the 
People's Republic of China, the Regulations of the People's Republic of China on Countervailing 
Measures, and the Provisional Rules for Implemen ting WTO Trade Remedy Rulings. China earnestly 
abides by the rulings of Dispute Settlement Pane l and Appellate Body in the relevant cases. 
Question 28 
WT/TPR/S/300, page 69, paragraph 3.49  
In paragraph 3.49, the Secretariat's report states that there has only been one instance in which 
the result of an anti-dumping investigation has been challenged through administrative reconsideration proceeding and through subsequent court litigation. It adds that the litigants are 
two Russian companies and the product concerned is grain oriented flat-rolled electrical steel. 
However, the Secretariat's report does not clearly explain the status of the court litigation.   
a)  Please indicate when the Russian companies filed for administrative reconsideration with 
MOFCOM.Is it correct that MOFCOM rejected the Russian companies claims in their entirety? If not, please explain.  
b)  Is it correct that the Russian companies subsequently commenced court litigation in 
October 2010? If not, please indicate when they did. 
c)  Is it correct that the court litigation is sti ll pending as of June 2014? Has the court issued 
any rulings while this litigation has been pending before it? If so, please explain.  WT/TPR/M/300/Add.1 
 
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 Answer (a-c) 
On 8 October 2010, MOFCOM rendered a decision on the administrative reconsideration proceeding 
regarding grain oriented flat-rolled electrical st eel initiated by two Russian companies, upholding 
the original final ruling on anti-dumping. Thereafter, the two Russian companies brought an 
administrative litigation. The Second Intermediate People's Court of Beijing Municipality rendered a 
ruling on 28 April 2014, approving withdrawal of the case by the two Russian companies. 
 
Question 29 WT/TPR/S300, page 69, paragraph 3.47  
In paragraph 3.47, the Secretariat's report describes the Provisional Rules Governing New Shipper 
Reviews , which were notified to the WTO in 2002.The United States notes that, in 2009, MOFCOM 
solicited public comment on draft revisions of its rules on new shipper reviews, anti-dumping duty 
refunds and price undertakings. To date, however, China has not finalized revisions to any of these 
measures. Please provide an update on the status  of the revision processes for each of these 
measures and indicate when China expects to finalize them and notify them to the appropriate WTO committees.  
 
Answer 
China has sought opinions on the revision of the Provisional Rules Governing New Shipper Reviews, the Rules on the Refund of Anti-dumpi ng Duties and the Provisional Rules on Price 
Undertakings, but not revised these rules yet, so it is not notified to the WTO. China will revise and 
improve the corresponding rules on the basis of pr actice and according to needs, and then inform 
the WTO of the revisions in a timely manner. 
 
Question 30 WT/TPR/S300, page 69, paragraph 3.48  
The Secretariat's report discusses anti-dumping sunset reviews. The United States understands 
that China has still not issued any measure specifically establishing the rules and procedures governing sunset reviews, despite the fact that MOFCOM has conducted at least 30 sunset reviews during the past two years. Is China drafting a measure setting forth the rules and procedures for 
sunset reviews? If so, please indicate when China expects to issue a draft measure for public 
comment.  
Answer 
China conducts fair, reasonable and whole-process sunset review investigation according to the 
Anti-Dumping Regulations of the People's Republic  of China and referring to the common practice 
of WTO members. China is in strict accordance with the principle of transparency and proper 
procedure in practice to ensure the rights an d interests of stakeholders. China studied the 
development of the sunset review rules, and found the vast majority of WTO Members carrying out sunset review investigation had not announced th e laws and regulations concerning the sunset 
review, and thus it was difficult to draw referenc e. China will continue to study the development of 
the sunset review rules on the basis of practice.  
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.1 Measures Directly Affecting Imports  3.1.8 Standards and other technical requirements  
 
Question 31 WT/TPR/S300, page 74, Paragraph 3.69  
In paragraph 3.69, the Secretariat's report describes China's procedures for developing standards 
and technical regulations. It explains that China frequently cites voluntary standards in technical 
regulations, thereby in effect turning these voluntary standards into mandatory standards. For example, Chinese measures setting food safety re quirements frequently cite previously developed 
voluntary standards. However, China generally do es not notify these voluntary standards to the 
WTO for Member review and comment, even afte r citing them in technical regulations and 
effectively turning them into mandatory standards. Could China explain why it takes this 
approach? When will China begin notifying voluntar y standards that have been cited in technical 
regulations?  WT/TPR/M/300/Add.1 
 
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 Answer 
China has been actively performing its obligation of transparent notification and will further do a 
good job in TBT/SPS notification. 
 
Question 32 WT/TPR/S/300, page 77, paragraph 3.78  
In paragraph 3.78, the Secretariat's report explains that [a]nother salient feature of China's SPS 
system is the fragmentation of regulatory authorities among different Government agencies. The United States notes that U.S. companies are increasingly facing conflicting requirements among the Ministry of Agriculture, the General Administ ration of Quality Supervision, Inspection and 
Quarantine (AQSIQ) and the National Health and Fa mily Planning Commission. What steps is China 
taking to ensure that new SPS regulations and rules and changes to existing SPS regulations and rules are coordinated and cleared by all concerned agencies? 
 
Answer 
The WTO has no requirement on the number of agencies responsible for SPS measures. Many WTO 
Members including the U.S. have many agencies responsible for SPS measures involving 
international trade. The AQSIQ is responsible fo r supervision on imported foods, animals and 
plants as well as animal and plant products, China Food and Drug Administration (CFDA) the Ministry of Agriculture for supervision on domest ic production and circulation, and the National 
Health and Family Planning Commission for development and revision of national food safety 
standards. All Chinese supervision agencies conduct segment management, have clear labor division and collaborate with each other. There exist no fragmentation and/or overlapping of 
regulatory authorities among different governme nt agencies mentioned in paragraph 3.78, the 
Secretariat's report.  China will appreciate if specific cases of conflic ting requirements among different ministries and 
departments could be provided by the U.S. further.  
 Question 33 WT/TPR/S300, page 78, Paragraph 3.81  
In paragraph 3.81, the Secretariat's report refere nces a Catalogue of Import Commodities Subject 
to Safety and Quality Permits, that stipulates the general standards for goods that are highly sensitive in terms of safety, sanitation and environmental protection. Can China provide a link to 
this catalogue? If this catalogue notes any change s in standards, has China notified them to the 
WTO? If not, when will China notify them?   
Answer 
The Catalogue of Import Commodities Subject to Safety and Quality Permits was developed in 
1995 based on the Safety Quality Licensing System  for Imported Commodities (2012 version) and 
has been abolished. Relevant imported commodities  are subject to specific requirements of the 
Catalogue of Inbound and Outbound Commodities for Inspection and Quarantine by Entry-exit 
Inspection and Quarantine Institutions and the Administrative Measures for China Compulsory Certificate, both of which are available at the AQSIQ website.  
3 TRADE POLICIES AND PRACTICES BY MEASURE 
3.2 Measures Directly Affecting Exports  3.2.2Export taxes, charges, and levies  
 
Question 34 WT/TPR/S/300, pages 79-81, paragraphs 3.88-3.92  
In paragraphs 3.88-3.92, the Secretariat's report states that China continues to apply export 
duties on a wide range of products. It expl ains that, between 2011 and 2013, China imposed 
export duties on 4.2% of all tariff lines at the HS- 8-digit level. Table 3.9 lists 347 tariff lines at the HS 8-digit level on which China imposed export duties in 2013.Although the Secretariat's report 
does not discuss the panel and Appellate Body find ings on China's export duties in DS394, DS395, 
DS398, DS431, DS432 and DS433, the United States  notes that two panels and the Appellate 
Body found that paragraph 11.3 of part I of Chin a's WTO Protocol of Accession commits China to 
eliminate all export duties unless specifically provided for in Annex 6 of the Protocol or applied in 
conformity with the provisions of Article VIII of the GATT 1994 and, further, that Article XX of the 
GATT 1994 is not available to justify a violation of this commitment. Given the nature of these WT/TPR/M/300/Add.1 
 
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 findings, please explain why China continues to impose export duties on products that are not 
listed in Protocol Annex 6.Does China plan to eliminate these export duties? If so, when?  
Answer 
Considering the need to protect the environment and natural resources, China levies export tariffs 
on some resource-consuming, high-energy-consum ing products. The number of tariff lines subject 
to export tariffs keeps stable in recent years in general. 
 3 TRADE POLICIES AND PRACTICES BY MEASURE 3.2 Measures Directly Affecting Exports  
3.2.3Export prohibitions, restrictions, and licensing  
 Question 35 
WT/TPR/S/300, page 81, paragraph 3.96 
In paragraph 3.96, the Secretariat's report states that China continues to impose global and destination-specific export quotas. In 2013, global export quotas applied to 193 tariff lines at HS-8 
digit level, up from 180 in 2011.The increase in the number of lines was due largely to a change in 
nomenclature and splitting of lines since, as of  1 January 2013, China eliminated global export 
quota on bauxite, zinc ore/sand, coke, and ca rborundum. However, these products, with the 
exception of zinc ore/sand, are still subject to export licensing. For each product still subject to an 
export quota (with the exception of the export quotas on rare earths, tungsten and molybdenum 
that are currently the subject of WTO disput e settlement in DS431, DS432 and DS433), please 
explain how China justifies the export quota in light of China's WTO obligations?  
 
Answer 
In order to protect exhaustible natural resources and achieve sustainable development, the 
Chinese government applies quota to the export of some raw materials. The Chinese Government 
does not intend to restrain trade, nor does it intend to protect domestic industries through distorting trade. This quota administration approa ch is in line with WTO rules. In the meantime, 
the Chinese Government has carried out administration on the domestic exploitation and 
production of such raw materials. Reasonable quota of exports are determined on the basis of 
taking into consideration domestic and international markets, and the carrying capacity of the environment, therefore they can basically meet the normal demands of the international market. 
 
Question 36 WT/TPR/S/300, page 82, paragraph 3.98 
Table 3.10 indicates the products that China subj ected to export licensing in 2013.According to 
Table 3.10, a license is granted for these products if the exporter has the relevant export contract.   
a)  Is an exporter required to submit an expo rt contract when the exporter applies for an 
export license for bauxite, coke, fluorspar, manganese and silicon carbide? How is the 
export contract used in the administration of the export licensing process?  
b)  Have there been any procedural changes to the export licensing regime since the last 
Review, including with regard to which local authorities are responsible for issuing export 
licenses for bauxite, coke, fluorspar, manganese and silicon carbide? Please explain the reasons for any changes and how they impact the export license regimes for these 
products.  
 Answers (a-b) 
An exporter is only required to submit an export contract when he applies for an export license for 
bauxite, coke, fluorspar, manganese and silicon ca rbide. After the last review, China cancelled the 
export quota of bauxite, coke, fluorspar and silicon  carbide, and changed the type of export license 
of such products as bauxite and coke from export  quota license to general export license; and the 
license issuing authority was changed from local ag ency accredited by Ministry of Commerce to 
local issuing authority. The change of the issuin g authority simplifies the procedure, saves time, 
facilitates enterprises to obtain export licenses and saves the licensing cost. However, there has 
been no change to the manganese export licensing procedure. 
 WT/TPR/M/300/Add.1 
 
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 3 TRADE POLICIES AND PRACTICES BY MEASURE 
3.2 Measures Directly Affecting Exports  3.2.4 Export support and promotion  
 
Question 37  
WT/TPR/S/300, page 83, paragraph 3.101  
According to the Secretariat's report, China indicated that it did not maintain or introduce any 
export subsidies on agricultural products during 2011 or 2012.To date, the United States has brought four WTO disputes (DS358, DS387, DS419 and DS450) in which it has challenged hundreds of Chinese central government and sub-central government measures as providing 
prohibited export subsidies or prohibited import substitution subsidies, some of which have 
benefitted agricultural producers. In addition, many WTO Members, including the United States, both in the counter notification that it filed in 2011 under Article 25.10 of the SCM Agreement and 
in other WTO submissions, have previously identi fied and raised concerns about a wide range of 
unreported Chinese government subsidy programs, and many of these subsidy programs, including ones benefitting agricultural producers,  have appeared to be contingent upon export 
performance. In the two subsidies notifications th at it has submitted under Article 25 of the SCM 
Agreement in its 13 years of WTO membership, the most recent of which covered the period from 
2005 to 2008, China has never notified a single sub-central government subsidy. Given these circumstances, can China clarify whether its statement that that it did not maintain or introduce 
any export subsidies on agricultural products during 2011 or 2012 applies only to central 
government subsidies, or does it also take into account sub-central government subsidies?  
Answer 
The Chinese central government did not maintain or introduce export subsidies on agricultural 
products during 2011 or 2012. The local governme nts also fulfilled the responsibility to comply 
with WTO rules and China's WTO commitments. 
 
a)  Did China introduce any export subsidies on agricultural products in 2013 or 2014? 
20132014  
 
Answer 
China will notify Agricultural Committee after confirmation.  
 
Question 38 WT/TPR/S/300, page 83, paragraph 3.102  
Paragraph 3.102 of the Secretariat's report explai ns that in China the value-added tax (VAT) may 
be rebated on exports, but exporters are genera lly entitled to VAT rebates lower than the VAT 
paid. In connection with the 2012 Trade Policy Review  of China, the Secretariat's report noted (in 
paragraph 143 of Part III) that [t]he difference between the two rates constitutes a levy on 
exports, which may in turn constitute assistance to downstream processing of the products 
affected, and could affect China's terms of trade. It added that China adjusts VAT rebate rates as 
part of its industrial policies, to control, rest rict, or otherwise manage the export of certain 
products.  
 
a)  Does China agree that moving to a trade-neutral VAT system, in which input VAT is 
rebated in full for all exports, would help the market play a decisive role in allocating 
resources, consistent with one of the key reforms announced by the Third Plenum Decision? If not, please explain. 
b)  The Resolution passed at the Third Plenum on 12 November 2013 states in paragraph 18: 
Move forward with value-added tax reform. Does this statement contemplate the adoption 
of a trade-neutral VAT system, in which the input VAT is automatically rebated in full for all exports? If not, please explain what reform is contemplated.  
 
Answers (a-b)  
Moving forward with value-added tax reform has been an established part of China's continued tax 
reform. But more details need to be clarified. By  now, measures at least include: continuing to 
implement the reform of replacing the business tax with a value-added tax, cleaning up tax preferential policies, and appropriately simplifying tax rate structure.  
 WT/TPR/M/300/Add.1 
 
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 c)  Is China studying the possibility of adopting a VAT rebate policy pursuant to which the 
input VAT is automatically rebated in full for all exports, consistent with the policies prevailing in other WTO Members with a VAT system? If so, when does China anticipate 
that it will be able to adopt such a policy? Please explain.  
 Answer 
With respect to China's current national conditio ns, to achieve a full refund of all export goods 
need to be linked with a number of other issues, such as raising environmental protection and energy conservation standards, strengthening la w enforcement and supervision, moving forward 
with resource tax and environmental tax reform, cleaning up VAT preferential policies, reducing 
the risk of cheating out of tax rebates in expo rt etc. Many of these measures have been in 
implementation, but the timing still should be under observation.   
Question 39 
WT/TPR/S/300, page 83, paragraph 3.102  
In paragraph 3.102, the Secretariat's report notes that China uses variable VAT rebate rates for 
steel exports. Indeed, China uses variable VAT rebate rates for numerous steelmaking raw 
materials and primary, semi-finished and finished products in the steel sector.   
a)  What objectives is China seeking to achieve through these practices? Has China considered 
other less trade-distorting means for achieving its objectives?  
 Answer 
China uses variable VAT rebate rates for steelmaking raw materials and primary products mainly for the consideration of reducing non-renewable resource consumption and environmental pollution and not encouraging export of relevant products. China's steelmaking capacity growth is 
mainly contributed to market demand growth and economic growth promotion by local 
governments. VAT as a neutral tax, exerts minor influence on capacity growth, so does export tax rebate policy as part of VAT. Solving steel over-cap acity depends on the role of self-adjustment of 
the market. 
 
b)  In the period since China began using variable  VAT rebate rates for steel exports, China's 
steelmaking capacity has grown from 424 million metric tons (MT) in 2005 to an estimated 
990 million MT in 2013, and China has become the largest steel exporter in the world, with 
62 million MT of steel exports in 2013.At the same time, in 2013, the China Iron and Steel Association estimated that China's excess steel making capacity exceeded 200 million MT. 
Given these developments, does China believe that its VAT rebate policies contribute to 
the rationalization and market-orientation of its steel industry? What work has China done to analyze their contribution to China's severe overcapacity problem?   
Answer 
China's steel production increased from 350 million tons in 2005 to 790 million tons in 2013, but 
the steel production is mainly for domestic demands. China's steel exports reached 62.33 million 
tons in 2013, accounting for less than 8% of total production. Currently, only a few products such 
as grain-oriented silicon steel and high quality alloy steel enjoy tax rebate, and the proportion of such products accounts for a very small proportion in China's total steel production. The current 
tax rebate policy has minimal impact on the growth of steel production capacity and the resolution 
for the problem of serious excess capacity.  3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.1 Incentives  
 
Question 40 
WT/TPR/S/300, page 87, paragraph 3.119 In paragraph 3.119, the Secretariat's report review s China's last subsidy notification, which covers 
the period 2005-2008, and then states that, [a]cco rding to the authorities, the programs have not 
changed substantially since 2008.It then adds that [t]he authorities were not able to provide statistical data regarding disbursement for the different support programmes, taxes forgone as result of the support measure; or the amount budg eted for these. Given that a principal objective WT/TPR/M/300/Add.1 
 
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 of the Trade Policy Review Mechanism is facilitating the smooth functioning of the multilateral 
trading system by enhancing the transparency of Members trade policies, can China explain why it 
was not able to provide the requested information to the Secretariat?  
 
Answer 
Technical work on China's next subsidy notification is still going on. Although there has been some 
general information on the status of the programs contained in the last notification, details of 
changes that may have occurred in respect of each programme are still to be worked out. This explains why statistical data regarding disbursement for the programs were not available for the Secretariat. The information will be provided in th e next subsidy notification. However, the data for 
programmes in the form of preferential tax policies would still not be available as up till now China 
has not yet put in place a formal statistic system for tax expenditure.  
Question 41 
WT/TPR/S/300, page 88, paragraph 3.121, and pages 189-90, Table A3.5  
Table A3.5 lists selected subsidies and other ince ntives provided by three sub-central governments 
in China in order to attract foreign investment. As the subsidies identified in Table A3.5 are 
provided by sub-central governments, is it correct  that none of the subsidies identified in Table 
A3.5 has been notified to the SCM Committee? Wh en will China notify the subsidies to the SCM 
Committee as required by Article 25 of the SCM Agreement?  
 
Answer 
China will verify the information in Table A3.5 in the course of its preparation for the next subsidy 
notification. If the programs listed in Table A3.5 are verified and confirmed to be subject to the 
notification obligation under the SCM Agreement,  they will be included in the next subsidy 
notification 
 
Question 42 WT/TPR/S/300, page 88, paragraph 3.126  
In paragraph 3.126, the Secretariat's report states that, in addition to the subsidy programs 
notified by China to the SCM Committee under Arti cle 25 of the SCM Agreement, there appear to 
be other support programmes and other means to support different industries including through the provision of grants, policy lending by state-owned banks and the supply of goods at lower than 
market price by state-owned enterprises. However, the Secretariat's report adds that, in the 
context of this Review, no information was provided to the Secretariat regarding these specific programmes or China's industrial policies that  supported different areas of the economy. 
Moreover, the identification of these programmes has not been possible for the Secretariat, as 
specific support measures seem to be the result of internal administrative measures that are not published in English.   
a)  Can China confirm the conclusion made by the Secretariat's report that China maintains 
subsidy programs such as the provision of grants, policy lending by state-owned banks and the supply of goods at lower than market price by state-owned enterprises that have not 
been notified to the SCM Committee?  
b)  The Secretariat's report concludes that some subsidies seem to be the result of internal 
administrative measures that are not published in English. Can China confirm this 
conclusion? Are the referenced internal administrative measures published in Chinese? If 
so, where are they published?  
Answers (a-b) 
China is not in the position to confirm the assumption of the Secretariat as the wording in the Report is either there appear to be or seem to be. China does not agree that loans of state-owned 
commercial banks operating under market principles be regarded as subsidies, nor does China has 
information indicating that goods are supplied at lower than market price by state-owned 
enterprises. Credit is a volitional conduct of ma rket players, into which the Chinese Government 
has not intervened. Single indicators including enterprises returns return on equity and more 
importantly comprehensive factors including future solvency, creditworthiness and sustainable 
development are taken into account for loans of commercial banks. Current different enterprise loan limits and interest rates in the practices are volitional conducts made by commercial banks based on their market judgment rather than being caused by different ownership systems. The WT/TPR/M/300/Add.1 
 
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 Chinese Government cancelled subsidies granted to SOEs by fiscal and tax reform and other 
measures in 1990s.   
Question 43 
WT/TPR/S/300, page 88, paragraph 3.126, and pages 191-98, Table A3.6  
Table A3.6 lists approximately 33 fisheries support programs that the Secretariat uncovered, and 
each of these support programs appears to provid e subsidies. However, the Secretariat's report 
notes that the authorities could not verify this information, and none of the subsidies has been notified to the SCM Committee as required by Article 25 of the SCM Agreement.  
 
a)  Please explain why the Chinese authorities were unable to verify any of the information set 
forth by the Secretariat in Table A3.6. 
 
Answer 
We are still verifying the information listed in the Table. We need more time for the verification 
given the ambiguous descriptions of support projects for fisheries, various sources of information, 
and unidentified competent authorities, executors and scope of these support projects. 
 
b)  In connection with China's Trade Policy Review in 2012, the United States referenced one 
report estimating that subsidies benefitting China's fisheries sector exceeded US$4 billion 
as far back as 2003 and asked China to explain why it had not notified any of its fisheries 
subsidies to the SCM Committee. China responde d that it refused to notify them until 
Members agreed to specific disciplines on fisheries subsidies. Does China agree that Article 
25 of the SCM Agreement obligates Members to notify their fisheries subsidies? Is China 
aware that numerous other Members includin g both developed and developing country 
Members have notified their fisheries subsid ies to the SCM Committee? When will China 
notify the subsidies identified in Table A3.6? 
 Answer 
When the last notification on subsidy of China was prepared, there was not much information 
identified to be specifically related to the fishery industry. In the course of China's preparation for 
the next notification if certain programmes are identified to be specific for the fishery sector and should be subject to the notification obligation un der the SCM Agreement, they will be included in 
the notification. China will carry out the work taking into account the information in the Table A3.6 
in the Secretariat Report.   
Question 44 
WT/TPR/S/300, page 89, paragraph 3.127 In paragraph 3.127, the Secretariat's report discusses China's so-called strategic emerging industries and explains that the value added contri bution of these new strategic industries to GDP 
should reach some 8%.In order to attain this goal, the Plan calls for strengthening policy support 
and guidance. This is to be attained through, inter alia, setting up special funds for the 
development of new strategic industries and investment. Although the Secretariat's report does 
not mention it, the United States submitted questions to China under Article 25.8 of the SCM 
Agreement in April 2014, identifying numerous central government and sub-central government initiatives supporting China's strategic emerging industries. None of these initiatives has been 
notified by China as required by Article 25 of the SCM Agreement.  
 
a)  To date, how much total funding has been allo cated to the special funds to develop China's 
strategic emerging industries? 
b)  Please identify each of the special funds and itemize the funding allocated to it to date. 
 
Answers (a-b) 
Special funds supporting development of China's stra tegic emerging industries, if confirmed in the 
course of preparation of China's next subsidy notification under the SCM Agreement, will be included in the notification.  
 
c)  Have any prohibited export subsidies or prohibited import substitution subsidies been 
provided to support the strategic emerging industries at the central government level or the sub-central government level? Please explain.  WT/TPR/M/300/Add.1 
 
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 Answer 
We are not yet aware of any prohibited subsid ies supporting development of China's strategic 
emerging industries. Prohibited subsidies are rarely detected now in China compared with years 
before as rules of the WTO in this regard are be tter known by governments at various levels after 
a decade of accession. Members may let China know should they encounter any prohibited export subsidy. 
 
d)  When will China notify the subsidies identifi ed in the questions submitted by the United 
States under Article 25.8 of the SCM Agreement?   
Answer 
Information and questions provided by the U.S. will be considered in the course of China's 
preparation of its next subsidy notification. China will be in a better position to clarify details of the 
U.S. submission after finalizing its notification. 
 Question 45 
WT/TPR/S/300, page 90, paragraph 3.129  
In paragraph 3.129, the Secretariat's report cites to the 2012 annual report of the People's Central 
Bank of China (PBC) and notes the PBCs role in enhancing coordination between credit policy and 
industrial policies. It explains that the PBC has guided financial institutions to increase financial 
support to important areas of the economy and to extend credit to key industries such as thermal 
power and steel, shipping and railways. Financial institutions were encouraged to use flexible credit products so as to enhance support for export-oriented enterprises. . . .In 2012, credit, 
financial support, preferential loans and the improvement of financial services played an important 
role in the implementation of the national policy of regional economic development.  
a)  Please describe the nature and extent of the financial support provided by financial 
institutions to the steel industry in 2012. 
b)  Please describe the nature and extent of the flexible credit policies used to enhance 
support for export-oriented enterprises.  
c)  Will China agree to notify to the SCM Committee the above-referenced credit policies that 
resulted in preferential treatment to specific industries or exporters? When will China notify them? 
 
Answer (a-b) 
The impact of credit policies on bank credit is neutral on the whole. The major aim of credit 
policies is to guide commercial banks to pay more attention to the development prospects and the 
risks involved in the relevant industries and sectors and to adjust and optimize the credit structure according to the principle of "making finance serv e the real economy". Therefore, credit policies 
are to give guidance rather than to require mandatory compliance. Nowadays, Chinese commercial 
banks have gradually established a modern financial corporate system over the years of 
marketization reform, and are independently operated market players.  
Question 46 
WT/TPR/S/300, page 91, paragraph 3.132 and Table 3.12  
Table 3.12 indicates that, pursuant to the  Renewable Energy Law , China currently provides 
subsidies to promote new energy vehicles and ener gy saving vehicles, and that the recipients of 
these subsidies are the customers who purchase these vehicles, although no further details are provided.   
a)  The United States understands that subsidies to promote new energy vehicles and energy 
saving vehicles are provided pursuant to measures issued by NDRC, MIIT, the Ministry of Finance (MOF) and the Ministry of Science and Technology (MOST), including the Notice on 
Continuing to Carry Out the Work of Promoting the Use of New-Energy Vehicles , Cai Jian 
[2013] No. 155, issued in September 2013.China has not notified this measure or any of the other measures that provide subsidies to promote the sale of new energy vehicles and 
energy saving vehicles. Can China provide a list of all measures that have been issued to 
promote the development of new energy vehicles and energy saving vehicles? WT/TPR/M/300/Add.1 
 
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 b)  The 2013 Notice on Continuing to Carry Out the Work of Promoting the Use of New Energy 
Vehicles does not specify which vehicles are eligible for consumer subsidies under this 
program. Can China explain how new energy vehicles may qualify for these subsidies? 
c)  Are imported new energy vehicles or imported energy saving vehicles eligible for consumer 
subsidies? If so, why have no imported vehicles  been qualified for these subsidies to date?  
 
Answers(a-c) 
Supporting measures for new energy vehicles and energy saving vehicles will be examined in 
China's preparation for the next subsidy notifica tion. However, China would like to have other 
Members views on whether consumption subsidies ar e subject to the notification obligation under 
the SCM Agreement. Currently vehicles listed in the Catalogue of Recommended Models of New 
Energy and Energy Saving Vehicles are eligible for the subsidies from the central budget.  
 
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  3.3.2 Competition policy and price controls  
 
Question 47 WT/TPR/S/300, page 94, paragraph 3.138  
How many civil cases have been brought under the Anti-Monopoly Law ?  
 
Answer 
18 civil cases of first instance brought under th e Anti-Monopoly Law were accepted by the local 
people's courts in 2011, 55 in 2012, and 72 in 2013. 
 Question 48 
WT/TPR/S/300, page 96, paragraph 3.147  
Are the activities of standards setting organizati ons (whether private or supervised by China) 
subject to the Anti-Monopoly Law ? If so, please explain where and how application of the Anti-
Monopoly Law  would take place.  
 
Answer 
According to Article 2 of the Anti-Monopoly Law, this law should apply to the monopolistic conducts 
in economic activities within the territory of the People's Republic of China; this Law should also 
apply to the monopolistic conducts outside the territo ry of the People's Republic of China that have 
the effect of eliminating or restricting competition on the domestic market of China. Therefore, any 
organization with monopolistic conduct that have the effect of eliminating or restricting 
competition on the domestic market of China will be investigated by Chinese anti-monopoly law enforcement authority, regardless the nationality, nature and other factors.  
The monopolistic conducts prohibited by the Anti -Monopoly Law of the People's Republic of China 
includes: i) monopoly agreements reached betw een business operators, including monopoly 
created by horizontal/vertical integration; ii) abuse of dominant market position by business 
operators; iii) concentration of business operators that may have the effect of eliminating or 
restricting competition. Chinese anti-monopoly law enforcement authority investigates the monopolistic conducts in the said three areas according to laws. 
 
Question 49 WT/TPR/S/300, page 99, paragraph 3.160  
Paragraph 3.160 and the following provides a summary of MOFCOM's Rules on Implementing the 
National Security Review Mechanism for Mergers and Acquisitions of Domestic Enterprises by 
Foreign Investors  (the MOFCOM National Security Review).These paragraphs do not provide 
statistics on the number of reviews and decision s under the MOFCOM National Security Review, 
which has been in effect since September 2011.Can China provide statistics on the number of 
reviews conducted under the MOFCOM National Security Review, including the number of reviews that resulted in unconditional clearance, conditional clearance or prohibition?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
In order to regulate foreign M&A, the Chinese Government issued the Notice on Establishment of 
Security Review System Pertaining to Mergers and Acquisitions of Domestic Enterprises by Foreign 
Investors in February 2011 on the basis of the fe asibility studies and the experience of the United 
States, Europe and other developed countries and regions. The Notice marks the formal establishment of a unified and standardized security review system for foreign capital M&A and 
clearly defines the scope, content, working mechanism and procedure of security review. 
According to the Notice, the scope of security review should be mergers and acquisitions of 
domestic enterprises and supporting enterprises involved in the military industry, enterprises located near key and sensitive military facilities, and other units related to national defense; 
mergers and acquisitions of domestic enterprises involved in key agricultural products, key energy 
and resources, vital infrastructure, important transp ortation services, core technologies, significant 
equipment manufacturing, which are related to national security and in which the actual controlling 
rights of the enterprises may be obtained by foreign investors. The information associated with 
security review is not made public due to its sensitivity and confidential matters involved.   
Question 50 
WT/TPR/S/300, page 99, paragraph 3.165  
Does China view technology as a commodity for which the government should set prices? If so, under what circumstances would the government set prices for a standards essential patent? Has 
the Chinese government set prices for technology to date? Please explain.  
 Answer 
The Chinese government has no set prices for technology. According to China's WTO commitments, only a small part of goods and serv ices (see Protocol Annex 4) are subject to 
government-set or government-guided prices, the prices of the vast majority of goods and 
services are fully formed by the market. 
 Question 51 WT/TPR/S/300, page 99, paragraphs 3.160-3.164  
Paragraphs 3.160-3.164 describe MOFCOM's Rules on Implementing the National Security Review 
Mechanism for Mergers and Acquisitions of Domestic Enterprises by Foreign Investors (the MOFCOM National Security Review). Paragraph 3.160 indicates that, for certain M&A transactions, 
clearance under the MOFCOM National Security Review is required as a prerequisite for any other 
administrative procedures. Paragraphs 3.160-3.164 do not, however, describe China's other mechanisms for national security review of foreign investments.  
 
a)  Can China clarify what other laws, administrative regulations or departmental rules require 
and/or permit national security reviews of foreign investments? At what level(s) of government do these national security reviews occur? Which foreign investments are 
subject to these national security reviews? 
b)  The United States would like to understand better how the NDRCs recent Measures for the 
Administration of Ratification and Record-Filing of Foreign Investment Projects (the NDRC 
Measures), which will take effect on 17 June 2014, relate to the MOFCOM National Security 
Review. In particular, the NDRC Measures appear  to require national security reviews for a 
broader set of foreign investments than the M&A transactions covered under the MOFCOM 
National Security Review. For example, the NDRC Measures seem to include greenfield 
investments. Can China clarify whether the NDRC Measures are in fact an expansion of China's national security review of foreign investment? How would any national security 
review under the NDRC Measures be imposed and administered? How would any national 
security review under the NDRC Measures rela te to the MOFCOM National Security Review? 
For example, if a transaction clears the MOFCOM National Security Review, could it still be subject to national security review and possible prohibition or conditioning under the NDRC 
Measures? 
c)  The NDRC Measures also appear to empower local development and reform authorities to 
make determinations about the national securi ty effects of foreign investment projects 
subject to their review. Can China clarify the role played by local development and reform 
authorities?  
 WT/TPR/M/300/Add.1 
 
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 Answers ( a-c) 
In order to guide the orderly development of merg ers and acquisitions of domestic enterprises by 
foreign investors and on the basis of adequate st udy and analysis, the Chinese government issued 
the Notice of the General Office of State Counc il on Establishment of Security Review System 
Pertaining to Mergers and Acquisitions of Domestic Enterprises by Foreign Investors in February 2011. This notice has established a unified and regulated national security review system on 
merger and acquisitions by foreign investors. The Notice clearly defines the scope, content, 
mechanism and procedures of security review. According to the notice, mergers and acquisitions of domestic enterprises and supporting enterprises involved in the military industry, enterprises located near key and sensitive military facilities, and other units related to national defense; 
mergers and acquisitions of domestic enterprises involved in key agricultural products, key energy 
and resources, vital infrastructure, important transp ortation services, core technologies, significant 
equipment manufacturing, which are related to national security and in which the actual controlling 
rights of the enterprises may be obtained by foreig n investors. Due to the sensitivity of the content 
of the national security review, relevant data is not publicly available at the moment. The security 
review should be headed by National Development and Reform Commission and Ministry of 
Commerce under the leadership of the State Council. 
 3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.3 State trading, state-owned enterprises and privatization  
 Question 52 
WT/TPR/S/300, page 102, paragraph 3.171  
Paragraph 3.171 of the Secretariat's report describes the Price Law . With regard to technology, the 
United States would like to understand better how the Price law works.  
 
a)  Under what circumstances, would prices for technology be considered discriminatory, 
particularly in circumstances under which a patent has been licensed globally?  
Answer 
Article 17 of the Anti-Monopoly Law of the Peop le's Republic of China stipulates: "business 
operators with a dominant market position are prohibited from committing any of the following 
acts of abusing the dominant market position : ....(6) applying discriminatory treatments on 
trading prices or other trading conditions to their trading parties with equal standing without any justifiable causes". Article 16 of Anti Pricing Mono poly Regulations issued by National Development 
and Reform Commission also provides: "business operators that have a market dominant position 
shall not, without a justifiable reason, impose se lective price discrimination on trading partners 
who are entitled to the same transactions terms". Applying discriminatory treatments on patent licensing fees to trading partners with equal standing by a patentee constitutes discriminatory 
pricing for technology. 
 
b)  Is discriminatory a matter of intent, or is it determined by objective factors?  
c)  If a potential licensee has declined to negotiate in good faith, and the licensor has 
therefore decided to raise the price of the te chnology due to the increased costs resulting 
from the long negotiation and the possibility of litigation, would these higher prices be 
deemed discriminatory?  
 Answers (b-c) 
"Discrimination" is determined by objective fact ors rather than a subjective intent. The anti-
monopoly law enforcement authority, in the determ ination of "discriminatory" treatments applied 
by an operator to his trading parties, should make  it clear that whether his trading parties provide 
same conditions to the operator and whether the operators pricing for technology significantly 
deviates from the reasonable and fair standard. 
 
d)  If a company licenses a patent consistent with its global obligations, under what 
circumstances could such a license be deemed discriminatory in China?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
This case requires a specific analysis. First, there is a need to find the conclusive evidence proving 
"the licensee is unwilling to accept negotiations in good faith". When the patentee raises the 
technical price due to cost increase from the risk of long negotiations and litigation, the technical 
price increase made by the patentee to compensa te for the increase in paid costs does not 
constitute "discriminatory" pricing, although the potential licensee is identified unwilling to accept 
negotiations in good faith; however, if the patentee passes on the cost increase resulted from 
other potential licensees to the said licensee or th e price increase is indeed a retaliatory conduct 
against the said licensee, it may constitute "discriminatory" pricing.  
e)  As China may impose different requiremen ts regarding grant-backs of improvements, 
access to raw materials, tying and other arrangements, will different prices offered in light of these requirements be deemed discriminatory? 
 
Answer  
In China, a patent licensee is entitled to raise legitimate and reasonable requests according to 
laws. Different prices offered by a patentee in light of different requirements imposed by China 
regarding grant-backs of improvements, access to  raw materials, tying and other arrangements, 
should be treated differently. Unreasonable cost increase applied to trading partners with equal 
standing by a patentee may be considered discrimination. 
 
f)  Under what circumstances, would a company be deemed to engage in patent holdout? 
 
Answer   
Under the following three circumstances, a company will be deemed to engage in patent holdout: 
1. a patent is adopted as a standard, and the patentee packages the standard-essential patent and 
non-standard-essential patent together and then makes profits by licensing the packaged patents; 
2. a patentee intentionally keeps back or makes improper disclosure of the existing patent information or pending patent information in the course of standard adoption, and then exercises 
his legal rights but refuses to follow reasonable licensing terms and conditions after the standard is 
widely adopted and applied; 3. a patentee threaten s to sue and demands license fees much higher 
than the reasonable standard recognized by  other members of the standards development 
organization, after he joined the standards de velopment organization and promised to follow 
FRAND principles.  
 Question 53 
WT/TPR/S/300, page 102, paragraph 3.172  
Footnote 185 of the Secretariat's report indicates that it has been 11 years since China last submitted the required notification to the Work ing Party on State Trading Enterprises. Please 
explain why no notification has been made since 2003.The United States notes that other WTO 
Members have regularly provided new or updated notifications to the Working Party on State 
Trading Enterprises. When will China submit a new or updated notification?  
 
Answer 
The state trading regime of China, including th e products covered and the list of state-trading 
enterprises, has not seen major changes since the 2003 notification G/STR/N/9/CHN/Add.1, 
except that a couple of products were no longer subject to the state trading regime. Also, for a few 
products subject to state trading, some statistics required in the notification are not officially produced in China. In view of these, the state trading notification was not submitted. If Members  
expect China to submit the notification despite of  the few changes, China will prepare a notification 
as soon as possible.  
 Question 54 
WT/TPR/S/300, page 102, paragraph 3.173  
In paragraph 3.173, the Secretariat's report states that the quantities imported under state trading are not available.  
 
a)  The United States understands that the percentage allocations for state trading enterprises 
for China's TRQs are listed in Table 3.16. Could China provide the fill rates for each of these TRQs by state trading enterprises and by private enterprises?  WT/TPR/M/300/Add.1 
 
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 b)  Please explain why China does not regularly publish information on the fill rates for each 
TRQ by state trading enterprises and by private enterprises.   
Answers (a-b)  
The relevant quota application forms include the option - "do you agree to provide the company's 
quota against inquiries from foreign and domestic enterprises. In practice, the vast majority of 
enterprise applicants choose not to make quota public to protect their trade secrets. Meanwhile, 
C h i n a  C u s t o m s  d o e s  n o t  m a k e  i m p o r t  d a t a  s t a t i s t i c s  b y  t h e  n a t u r e  o f  S T E s  o f  o r  n o n -  S T E s  enterprise. Therefore, we are unable to provide the information of the products imported by 
different types of foreign trade enterprises. 
 
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.4 Government procurement  
 Question 55 
WT/TPR/S/300, page 109, paragraphs 3.197 -3.198  
The Secretariat's report notes that China is currently an observer to the WTO Agreement on Government Procurement (GPA) and is in the process of negotiating its accession thereto. It explains that China submitted its initial offer in  January 2008 and its most recent revised offer in 
December 2013.In China's view, how has its latest offer been received by GPA Parties? What 
specific obstacles hinder China's accession to the GPA? When does China envision being ready to accede to the GPA?  
 
Answer 
China has promised to submit a revised offer in 2014, which is roughly equivalent with the range 
of participants. Currently, China is under the pr ocess of a comprehensive coordination with the 
purpose of submitting the offer as soon as possible. China is still a developing country, and at a different development stage comparing with the US and other participants. In addition, China's ownership structure, management mechanism, cultural background, etc., are quite different from 
other participants. It is unrealistic to completely satisfy with other participants. Chinese 
government is committed to establishing an op en government procurement system; and China's 
position to accede the GPA as soon as possible has not been changed. 
 
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.5 Intellectual property rights  
 Question 56 WT/TPR/S/300, page 109, paragraph 3.199  
The Secretariat's report states that the Inter-Mini sterial Joint Conference for the Implementation of 
National Intellectual Property Strategy agreed to strengthen intellectual property rights protection in 2013.The United States notes that, in Decemb er 2012, China implemented the Requirement on 
GMO Samples and Technical Information, which requires that viable seeds be submitted with the 
biotechnology application for detection testing purposes without the protection of a Material Transfer Agreement. The United States believes that it would enhance the intellectual property 
rights protection of the applicants if China were to provide the applicants with a Material Transfer 
Agreement. Would China agree to do so?   Answer 
China attaches great importance to the protection of the IPRs of the applicants. Protecting the applicants IPRs is not only one of the most impo rtant duties of the government, but also the legal 
obligation and basic requirement for security assessment agencies and test agencies. As for the 
positive material and the relevant material provided by the applicants, the agencies which are 
responsible for storing and testing should strictly implement national laws and regulations to protect their IPRs. Thus, signing the Material Transfer Agreement is not a must to protect IPRs. 
 WT/TPR/M/300/Add.1 
 
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 Question 57 
WT/TPR/S/300, pages 109-110, paragraph 3.199(a)  
Please describe any actions that the State Intellectual Property Office (SIPO) has undertaken in 
the past two years to improve patent quality, particularly for utility model patents. [] 
 Answer 
On 16 September 2013, the SIPO published its Decision on Amending the Patent Examination Guidance, which enables patent examiners to ob tain related know-how or discover conflicted 
applications through search, enhances the examination of utility model patent applications that are apparently not novel, and further improves the qu ality of approval of utility model patents. On 
25 December 2013, the SIPO published the Some Opinions on Further Improving the Quality of 
Patent Applications, which enhances quality-orient ed patent applications by improving the patent 
evaluation indicator system, optimizing patent subsidy and reward policies, strengthening the 
regulation of abnormal patent applications and other irregular patent application activities. 
 Question 58 
WT/TPR/S/300, page 110, paragraph 3.199(d)  
The Secretariat's report states that one aspect of China strengthening IPR protection is strengthening the protection of IP resources in fields with traditional advantages. What are the 
fields with traditional advantages?  
 
Answer 
With respect to copyright, the State Council has put the legislation on folk literature and art 
copyright protection on its agenda. At present, relevant Chinese government departments are 
working on the draft.  
Question 59 
WT/TPR/S/300, page 113, paragraph 3.211  
In paragraph 3.211, the Secretariat's report discusses the Administrative Measures on Prioritized 
Examination of Invention Patent Applications .  
 
a)  Please explain whether foreign applicants are eligible for fast track patent examination 
approval under this measure.  
b)  Please explain how it is determined which industries can qualify for fast track patent 
examination approval under this measure.  
 
Answer (a-b) 
The Administrative Measures on Prioritized Examination of Invention Patent Applications also apply 
to foreign applicants.  
Article 4 of the said Measures prescribes the inve ntion patent applications that are entitled to 
prioritized examination, including important patent applications in such technical sectors as energy saving and environmental protection, new generati on information technology, biotechnology, high-
end equipment manufacturing, new energy, new ma terials, and new energy vehicles; important 
patent applications that are conducive to green development such as low-carbon technology and resource saving patents; the patent applications first lodged in China which are also lodged in 
other countries or regions regarding the same subj ect; and other patent applications that are of 
great significance to national interest or public interest and need to be examined with priority. 
 Question 60 
WT/TPR/S/300, page 115, paragraph 3.218  
Paragraph 3.218 of the Secretariat's report refers to the SAIC Rules on Recognition and Protection 
of Well-Known Brands . Is this measure the same measure as SAIC's Rules on Well-Known 
Trademarks , or is it a different measure? If it is a different measure, can China provide a citation 
for it and indicate where WTO Members can locate a copy of it?   
Answer  
Rules on Recognition and Protection of Well-Known  Brands are available on SAIC's website at:  
http://sbj.saic.gov.cn/.  WT/TPR/M/300/Add.1 
 
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 Question 61 
WT/TPR/S/300, pages 115-116, paragraph 3.224  
Paragraph 3.224 of the Secretariat's report indicates that, in China, geographical indications (GIs) 
may be registered as collective or certification marks with the TMO and may also be registered 
with AQSIQ or the Ministry of Agriculture.  
 
a)  Do the grounds for denying protection or recognition to a GI at China's State Trademark 
Office (TMO), AQSIQ and the Ministry of Agriculture include prior trademark rights that would likely cause confusion in China and evidence that the proposed term is recognized as a generic term by Chinese consumers? Al so, is there an opportunity for interested 
parties to oppose GI applications on both of these grounds at these three agencies? 
 Answer 
A GI is generally made up of conventionalized local geographical name and product name. A GI under application should avoid the common name of relevant product (e.g. bergamot pear) to prevent confusion. In addition, the applicant need s to accept review on conflicting GI name and 
trademark name (prior trademark registered in the China's trademark system). If the product 
name applied is registered as a common trad emark, the credentials of the common trademark 
registrant agreeing to transfer or use should be provided; if the product name applied is registered 
as a collective trademark, the applicant should be same with the trademark registrant. When it is 
investigated that GI is in conflict with prior registered trademark concealed, the GI registration 
certificate will be cancelled with an announcement. If any party concerned objects to the appeal, it may put forward its reasonable requirements.  
 
The SAIC registers and protects GIs by means of collective trademark registration or mark 
certification pursuant to the Trademark Law and the Regulations for the Implementation of the 
Trademark Law. According to Article 11 and Arti cle 30 of the Trademark Law, the application for 
registration of a GI trademark having a common na me or prior trademark right will be rejected.  
 When the prior right holder or interested party deem one GI registration application has prior 
trademark rights or anyone believes one GI re gistration application violates the provision 
prohibiting common name from being registered as trademark, an objection may be raised to the trademark bureau during objection period.  
 
b)  May any of the terms that have been granted protection and registered as a GI at TMO, 
AQSIQ and/or the Ministry of Agriculture be cancelled or invalidated? If so, what are the 
grounds for cancelling or invalidating a protected and registered GI? Do these grounds 
include prior trademark rights that would likely cause confusion in China and evidence that the proposed term is recognized as a generic term by Chinese consumers? 
 
Answer 
The certificate of agricultural product GI registrati on is valid for a long term. However, where it is 
investigated and verified that an agricultural product registered as GI or right holder no longer 
meets the conditions provided in the Measures for the Administration of Geological Indications of 
Agricultural Products or a conflict with prior trademark is found, the Ministry of Agriculture will cancel the Certificate of the GI Registration and makes an announcement.  
 
Pursuant to the Trademark Law, a trademark applied for registration may be cancelled or invalidated because it becomes a common name, has not been used for three consecutive years without any justified reason or has prior rights. GIs registered pursuant to the Trademark Law are 
applicable to above-mentioned provisions. 
 Question 62 
WT/TPR/S/300, page117, paragraphs 3.234 and 3.235  
The Secretariat's report notes in paragraph 3. 234 that following implementation of the 2010 
Interim Measures for Payment of Remuneration by Radio and Television Stations for Broadcasting 
Sound Recordings , broadcasting organizations must pay remuneration to the copyright owners for 
broadcasting musical works, with the methods and amounts of the payments being subject to 
agreement with the copyright collective administration organization. It also notes that the Music Copyright Society of China (MCSC), in early 2010, concluded a collective agreement on WT/TPR/M/300/Add.1 
 
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 remuneration payment for using music with 32 television stations members of the Television 
Copyright Commission of the China Ra dio and Television Association.  
Paragraph 3.235 then provides some statistics from 2011: In 2011, Chinese copyright collective 
administration organizations received copyright royalties for a total of RMB 201.2 million and 
distributed copyright royalties of RMB 173.86 milli on. The Music Copyright Society of China is 
China's largest (by number of members) copyright collective administration organization, with 
6,523 members and an annual income of RMB 88. 89 million. The China Audio-Video Copyright 
Association received the highest annual income in 2011, reaching RMB 110 million. The China 
Written Works Copyright Society enjoyed the most rapid growth in the number of members. In 2011, the Society accepted 1,715 new members, its total members reached 6,084, and the 
number of works authorized by its members amounted to 28,928.  
 
a)  In connection with China's 2012 Trade Policy Re view, the United States had noted that the 
implementation of a compulsory license fo r the public performance of musical works 
affects China's obligations under the Berne Convention, which is incorporated into the TRIPS Agreement by Article 9.1.The United States also had requested additional 
information regarding this implementation, including more specific details on the collection 
and distribution of monies (i.e., tariffs) rece ived and distributed. The Secretariat's report 
provides summary information for 2011.Could Ch ina provide any more specific information 
as to how the distributions were split betw een Chinese entities and foreign copyright 
owners? Also, is statistical data available for 2012 and 2013? 
Answer 
Music Copyright Society of China (MCSC) for an  example. Regarding music copyright royalties 
collected to be distributed to foreign copyright owners, MCSC makes distributions in strict 
accordance with reciprocal representation agreements it signs with overseas like associations as well as the distribution rules that are formulat ed by its member conference. When any foreign 
musical works are involved, MCSC deducts necessary management fees and make direct 
distributions to corresponding overseas associations  by attaching a detailed distribution schedule, 
and then overseas associations distribute monies  to their members. Four overseas distributions 
are made on an yearly basis.  
In 2012, MCSC collected overseas distribution s of RMB 5,087,725 and distributed RMB 22,758,581 
(management fees deducted) to overseas asso ciations. In 2013, MCSC collected overseas 
distributions of RMB 5,335,632 and distributed RMB 30,940,194 (management fees deducted) to 
overseas associations.  
 
b)  What happened to the RMB 27.34 million collected in 2011 by MCSC that was not 
redistributed? Does that amount (13.5% of the total collected) represent fees that the 
collecting society is entitled to retain under the 2010 Interim Measures for Payment of 
Remuneration by Radio and Television Stations for Broadcasting Sound Recordings  or 
some other applicable rules? Please explain.  
 
Answer  
All music copyright royalties collected in 2011 by MCSC were distributed according to distribution 
rules it formulated.  
c)  Has the China Written Works Copyright Societ y engaged in any collection and distribution 
of collective management revenues? Please also explain in more detail how this society 
operates.  
 
Answer 
Pursuant to Chinese laws and regulations, the China Written Works Copyright Society (CWWCS) 
undertakes one legal function to make transfer payment of legal license fees of national newspaper 
and journal reproduction and textbooks to co pyright owners. Meanwhile, the CWWSC manages 
little rights that are difficult to be controlled and exercised by right owners including members 
right of communication through information network and right of reproduction in strict accordance 
with laws, regulations and right owners membership contracts.   
At present, the CWWCS has engaged in authorizat ion of partial collective management as well as 
collection and distribution of copyright royalties. First of all, it has engaged in newspaper, journal and textbook legal license fee collection an d distribution. In 2013, the CWWCS collected WT/TPR/M/300/Add.1 
 
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 newspaper and journal legal license fees of over RMB 200,000 and paid royalties of articles 
reproduced by newspapers and journals or printed in textbooks to authors. Second, the CWWCS has participated in digital copyright authorization as well as collection and distribution. The 
CWWCS has cooperated with digital publishers and created digital copyright royalties of over 
RMB 1 million by popularizing members' works through new digital media platforms, all of which were successively distributed to members. Third, the CWWCS has explored royalty collection of 
overseas right of reprography and digital reproduction. The CWWCS is actively communicating and 
contacting with overseas right of reprography management organizations to discuss the collection of overseas royalties of reproduction rights and digital reproduction of Chinese written works.  
 
The CWWCS operates in the following way:  
Under the circumstance of legal licensing, the CWWCS actively looks for authors and pays to authors royalties as long as periodical offices and textbook publishers pay copyright royalties.  
For CWWCS members, as long as an author si gns the membership contract or entrusts the 
CWWSC to be responsible for specific copyright issues, the CWWCS negotiates with users on  
authorization and signs authorisation contract within  the scope of authorisation, collects copyright 
royalties and make transfer payment in full to members after deducting management fees. 
 
d)  The United States requests confirmation of the Chinese government's current views 
regarding the lack of payment to music copyri ght owners during the first eight years after 
China joined the WTO (i.e., 2001 to 2009). In this regard, in connection with China's 2012 
Trade Policy Review, the European Union asked China for an explanation of the retroactive effect of the tariff established by the 2010 Interim Measures for Payment of Remuneration 
by Radio and Television Stations for Broadcasting Sound Recordings , and China responded 
that the principle of non-retroactivity applies and these tariff rates are not applicable to cases prior to the 2010 measures entering into force. Does the Chinese government's view 
regarding the principle of non-retroactivity still apply to China's implementation of the 
2010 measure? Does the Chinese government's  view regarding the principle of non-
retroactivity also somehow extend to China's obligations under the Berne Convention, as implemented via the TRIPS Agreement? Please explain. 
 
Answer 
To be answered. 
 
Question 63 WT/TPR/S/300, page 118, paragraph 3.243 : Please identify the companies and the products 
that have been afforded regulatory data protecti on by China, along with the term of protection 
actually provided.  Answer 
Please refer to China's responses to Japan's relevant questions.  Question 64 
WT/TPR/S/300, page 118, paragraph 3.241  
In paragraph 3.241, the Secretariat's report highlights that [t]here is no specific legislation or regulations on undisclosed information and trade secrets in China, with the exception of one 
measure dealing with drug control. Particularly in light of the fact that theft of trade secrets by 
Chinese entities is a major and growing concern for foreign businesses, could China describe its plans for improving trade secrets prot ection and enforcement in China?  
 
Answer 
The Law of the People's Republic of China against Unfair Competition stipulates protection of trade 
secrets and investigation on infringement upon business secrets. Administrative law enforcement 
agencies at all levels have made great efforts in  infringement investigation and legal publicity. 
However, the parties involved of business secret cases in China mainly resort to litigation for resolution. 
 WT/TPR/M/300/Add.1 
 
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 Question 65 
WT/TPR/S/300, page 118, paragraph 3.243  
It is the United States understanding that China only affords regulatory data protection for a new 
pharmaceutical compound if China is the country of first launch of the product. Is our 
understanding correct? If not, please explain.   
Answer 
Please refer to China's responses to Japan's relevant questions. 
 Question 66 
WT/TPR/S/300, page 121, paragraph 3.254 : Please explain the status of China's efforts to 
develop specialized intellectual property (IP) courts.   
Answer 
The Supreme People's Court has been working on top-level design and overall planning and 
advance the establishment of IP courts in an active and steady way. Specific contents concerning 
the establishment of IP courts are being designed and planned. Further details are unavailable for 
the time being.  Question 67 
WT/TPR/S/300, page 121, paragraph 3.254  
It is the United States understanding that the percentage of civil court IP cases brought by 
foreigners in China is very low (less than 5% of the total).In contrast, it appears that many more 
administrative IP cases (nearly 50% of the total)  are brought on behalf of foreigners and that 
foreigners also more commonly bring civil cases in other areas, such as maritime law. Is China taking steps to facilitate foreigners' access to, and confidence in, the civil courts for IP cases? 
Please explain.  
 Answer 
Pursuant to the Civil Procedure Law of the People's  Republic of China, Article 261: Civil actions 
brought against a foreign national, a foreign organization or an international organization that 
enjoys diplomatic privileges and immunities shall be dealt with in accordance with the relevant law of the People's Republic of Chin a and the provisions of the international treaties concluded or 
acceded to by the People's Republic of China. Arti cle 262: The People's court shall conduct trials of 
civil cases involving foreign element in the spoken and written language commonly used in the People's Republic of China. Translation may be provided at the request of the parties and the 
expenses shall be borne by them. Article 263: Wh en a foreign national, a stateless person or a 
foreign enterprise or organization needs a lawyer as agent ad litem to bring an action and enter appearance on his behalf in the people's court, he  must appoint a lawyer of the People's Republic 
of China. Article 264: Any power of attorney maile d or forwarded from outside the territory of the 
People's Republic of China by a foreign national , a stateless person or a foreign enterprise or 
organization that has no domicile in the People's Republic of China for the appointment of a lawyer or any other person of the People's Republic of China as an agent ad litem must be notarized by a 
notarial office in the country of domicile and authenticated by the Chinese embassy or consulate 
accredited to that country or must go through the certifying formalities stipulated in the relevant bilateral treaty between China and that country before it becomes effective. 
 
China's Civil Procedure Law does not pose a very high threshold for IP cases brought by foreigners in China. When handling foreign-related IP cases, People's courts at all levels equally treat all parties concerned and hear all IP cases in a fair and equal way in accordance with relevant 
provisions stipulated in laws, regulations and judicial interpretations. Over the past 30-plus years 
since the reform and opening-up, People's courts have adapted IP juridical protection to innovation and development needs by concrete practices and have scored achievements. 
 
Question 68 WT/TPR/S/300, page 121, paragraph 3.254  
Under what circumstances may foreigners who are defendants in pending civil or administrative IP 
cases or anti-monopoly law cases be denied permission to exit China pursuant to Article 28 of the Alien Entry-Exit Regulations ?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
The exit of foreigner is pursuant to the Law of the People's Republic of China on Control of the 
Entry and Exit of Aliens, the Several Provisions on Restricting the Entry of Foreigners and Chinese 
Citizens in Accordance with Law formulated by the Supreme People's Court, the People's 
Procuratorate, the Ministry of Public Security and the Ministry of State Security as well as relevant 
litigation laws, regulations and judicial interpreta tions. There is no provision on the exit of 
foreigners in the Trademark Law, Copyright Law,  Patent Law and other specialized IP laws.  
 4 TRADE POLICIES BY SECTOR  4.1 Agriculture  
4.1.1 Features and market developments  
 Question 69 
WT/TPR/S/300, page 124, paragraph 4.2  
In paragraph 4.2, the Secretariat's report states that, in 2013, crops accounted for 55% of China's total agricultural production and livestock and fisheries accounted for 30.4% of China's total 
agricultural production. However, these percentages appear to conflict with the ones reported in 
China's National Bureau of Statistics Rural Statistical Yearbook. Would China explain the apparent discrepancy?   
Answer 
In order to ensure the consistency with the hist orical data, Paragraph 4.2 of the Secretariat's 
report in 2013, crops accounted for 55% of China's total agricultural production while livestock and 
fisheries accounted for 30.4% and 9.9% of China's total agricultural production does not include 
services of agriculture, forestry, animal husband ry and fishery. However, the data from China's 
National Bureau of Statistics Rural Statistical Yearbook are classified according to Industrial 
Classification and Codes for National Economic Activities, which includes the services of 
agriculture, forestry, animal husbandry and fishery.   4 TRADE POLICIES BY SECTOR  
4.1Agriculture  
4.1.2Policy objectives and administration   
Question 70 
WT/TPR/S/300, page 124, paragraph 4.4  
In paragraph 4.4, the Secretariat's report describes China's measures for introducing high-yield 
grain varieties and using technology in the agricu lture sector. Please explain how the objectives 
targeted by these measures are consistent with the policy maintained by China's agricultural authorities prohibiting the review of a foreign biotechnology dossier until the biotechnology product is approved in the country of origin.  
 
Answer 
China has introduced transgenic biotechnology products in accordance with law. Pursuant to 
relevant provisions stipulated in the Regulations on Administration of Agricultural Genetically 
Modified Organisms Safety, genetically modified organisms (GMOs) applied by overseas companies for the certificate of agricultural GMOs safety in  China should be allowed for corresponding use and 
launched in the market in exporting country or region. China encourages the introduction of high-
yield grain varieties and promotes agricultural production development based on food safety and GMOs safety which are consistent with each other.   
Question 71 
WT/TPR/S/300, page 125, paragraph 4.5  
In paragraph 4.5, the Secretariat's report states that some of the main laws regulating the 
agricultural sector have been amended in recent years. The United States is aware that China has 
announced or is considering several significant changes to its food safety administration, including proposed Amendments to the Food Safety Law that  would create a nationwide food recall system. 
 
a)  Please describe the impact that this new nationwide food recall system would have on 
imported products.  
 WT/TPR/M/300/Add.1 
 
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 Answer 
At present, China has not established new nationwi de food recall system. Article 53 of the Food 
Safety Law stipulates that the State shall establish food recall system. Food producers are required 
to promptly suspend production when finding their foods are in inconformity to food safety 
standards, recall foods sold in the market, notify relevant production operators and consumers and record recall and notice information.  
 
Food operators are required to promptly suspen d operation when finding the foods they operate 
are in inconformity to food safety standards, notify relevant production operators and consumers and record recall and notice information.  
 
Food producers should adopt remedial, innocent treatment, destruction and other measures for 
foods recalled, and report food recall and treatment information to quality supervision authorities 
above the county level.  
 Quality supervision authorities, industrial and commercial administration authorities and food and 
drug supervision administration authorities abov e the county level may order food producers and 
operators, which fail to recall products or suspend the operation of foods in inconsistent with food 
safety standards, to recall or su spend operation of such foods.  
 
b)  How would the various responsible Chinese authorities (i.e., the Ministry of Agriculture, 
AQSIQ, the National Health and Family Planning Commission, the China Food and Drug Administration and the Ministry of Environmental Protection) communicate with domestic 
producers, foreign suppliers, processors, consumers, importers and WTO Members if an 
imported product is designated as a source of contamination?  
 
Answer  
Various responsible Chinese authorities communicate with food producers or operators by 
telephone, letter or interview, or contact the importer if the producer is not in China.  
 
c)  Do these authorities coordinate their decisions to issue food recalls or related risk 
mitigation actions toward imported products with MOFCOM to ensure that the proposed measures minimize negative trad e effects? Please explain.  
 
Answer 
The Food Safety Law and relevant food recall system are being amended. Law formulation 
authorities solicit opinions from the MOFCOM in the stage of law and regulation drafting and the 
MOFCOM also reviews such drafts to ensure th e laws and regulations conform to the WTO rules 
and minimize their negative trade effects.   
d)  Also, how would China ensure that recalls concerning domestic products are communicated 
to WTO Members who may import those products?  
 
Answer 
The competent authorities require importers to try their best to notify recalls concerning domestic 
products to the exporters. The AQSIQ also publish the products recalled at its official website: 
http://www.aqsiq.gov.cn/ xxgk_13386/zvfg/flfg/. 
 Question 72 WT/TPR/S/300, page 125, paragraph 4.8  
In paragraph 4.8, the Secretariat's report states that as of 2014 contracted land can be sold and 
used as collateral. The United States previously understood that the rights to use and generate income from land can be transferred or used as collateral, but the ownership rights cannot be sold 
or mortgaged. Can China clarify whether contract ed land is able to be sold or mortgaged? 
 Answer 
Pursuant to existing Law of the People's Republic  of China on Land Contract in Rural Areas, the 
ownership nature of rural land contracted shall not be changed and contracted land shall not be sold. As stated in the Decisions of the Third Plenary Session of the 18
th CPC National Congress, 
Farmers are endowed with rights to occupy, use and make earnings from contracted land and to WT/TPR/M/300/Add.1 
 
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 pledge and guarantee cost operation right of contracted land. According to The operation right of 
contracted land is allowed to be pledged to financial institutions for financing by Chinese Government. Only the operation right of contracted land rather than land contracting right of 
farmer households may be pledged, and no issue of opening contracted land sale is involved.  
 4TRADE POLICIES BY SECTOR  
4.1 Agriculture  
4.1.3 Policy instruments   Question 73 
WT/TPR/S/300, pages 127-28, paragraph 4.14  
Paragraph 4.14 of the Secretariat's report explains that agricultural goods produced and sold directly by small-scale farmers remain exempt fr om the VAT. While the United States understands 
that, from China's perspective, this VAT exemption may simplify China's VAT administration vis-à 
vis small-scale farmers in China, it does not remove the discrimination faced by imported 
agricultural goods. Please explain on what basis China considers the VAT exemption to be non-
discriminatory within the meaning of Article III of the GATT 1994.  
 Answer 
Regarding this policy, China has made explanation and clarifications for several times including last 
TPR of China. In summary, we have the following points to make.  
First of all, China has a huge number of small farmers across the country, which makes it impossible to conduct accounting and tax filing. In other words, to levy value-added tax upon 
them is infeasible and uneconomical because of the huge administrative cost. This is the 
fundamental reason behind the policy.  Second, in China the agricultural production is mainly based on household operation. The sales 
scale is very small. The VAT exemption is applied only to farmers who sell their own products in an 
open air market. This is completely different from the import of products in bulk. Their VAT policies are not comparable.  Third, as far as we understand, other members with a VAT system also seem to exempt VAT from 
farmers who sell their own products, while levying tax over imported agricultural  products.  
Fourth, even if we apply VAT over these farmers, we would adopt a policy that would establish a commercially-meaningful threshold like in other countries. Most farmers would fall below the 
threshold. The real effect would be the same as the current policy. Therefore, China does not 
believe the current policy is not in compliance with its WTO obligations.  
 
Question 74 
WT/TPR/S/300, page 129, Table 4.5  
Table 4.5 of the Secretariat's report lists the agri cultural subsidies that were included in China's 
subsidies notification to the SCM Committee covering the time period 2005-2008.The United 
States has discovered a number of agricultural subsidies that were introduced during the time 
period 2005-2008 that were not included in China's subsidies notification Table 4.5, including:(1) Award transfer payments to major grain- and oilseed-producing and hog-supply counties 
(according to documents describing these payments, counties can receive these payments based 
on their performance in production, sales outside the county, and use of improved varieties, and the funds support local industry infrastructure, subsidized loans and services to farms); (2) a 
subsidy for reproducible sows introduced in 2006; (3) funds for construction of scale livestock 
farms and zones ( yang zhi xiao qu ) introduced 2006; (4) free mandatory vaccines for hogs and 
chickens; (5) funds for high-yielding grain, cotton,  oilseed and sugar production bases; (6) funds 
for vegetable basket standardized production base s; (7) funds for a grassland protection system 
begun in 2011; (8) a green channel support system that waives tolls on trucks carrying fresh and 
live agricultural products and waives or reduces utility fees in markets for vegetables, fruits, fish, and animal products for the domestic market; and (9) a pilot subsidy for soil testing and 
fertilization recommendations. In addition, the United States understands that, in 2012 and 2013, 
China provided subsidies to poultry farms and poul try processing enterprises during outbreaks of 
Avian Influenza. The United States further understands that China maintains export bases and 
demonstration bases to promote the export of ag ricultural products and provides subsidies to 
producers of agricultural products located in those bases. When will China notify the above-
described subsidies to the SCM Committee as requ ired by Article 25 of the SCM Agreement? When WT/TPR/M/300/Add.1 
 
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 will China notify the above-described subsidies to  the Agriculture Committee as required by Article 
18 of the Agreement on Agriculture?   
 
Answer 
The above programmes have been included in the Agricultural Domestic Support Notification. The 
programme of reproducible sows is included in the specific AMS; funds for a grassland protection 
system is listed in environmental payment in Green Box; free mandatory vaccines is listed in 
disease control in Green Box and so on. As for the export bases and demonstration bases, China 
does not have bases targeted to promote export of agricultural products, but there are bases to promote higher productivity with Green Box measures. 
 
Question 75 WT/TPR/S/300, page 130, paragraph 4.25  
In paragraph 4.25, the Secretariat's report states: The centrally funded comprehensive subsidy on 
agricultural inputs was introduced in 2006 and by 2008 had become one of the most important single budgetary transfers supporting agriculture.  Budgetary transfers for this programme more 
than doubled in 2008 and have increased each year since to reach RMB 107.8 billion by 2012.The 
objective of this support programme is to compensate grain producers for any increase in the price of agricultural inputs such as fertilizer and diesel fuels; however, it is implemented as a payment per unit of land, it is not linked to the cost of production. Can China explain whether this subsidy is 
increased when the price of fertilizer, fuel or other inputs increases?  
 Answer 
Comprehensive subsidy on agricultural inputs is to help producers coping with rising prices of means of production, such as fertilizers and diesel. The subsidy is adjusted to maintain a stable income for the producers when production costs are rising.  
 
Question 76 WT/TPR/S/300, page 131, paragraph 4.28  
In paragraph 4.28, the Secretariat's report states that the prices of some commodities remain 
controlled. Has China intervened on prices in the pork  sector in the past two years? Please explain.  
 Answer  
The degree of scale pork production in China is  very low, with many scattering pig-raising 
households. When pork price significantly rises, scattering raising households will considerably 
increase production, giving rise to sharp price fall in the later stage; when pork price sharply 
declines, scattering raising households will reduce reduction, thus triggering off substantial price 
hike in the later stage. Such significant periodic fluctuations of pork production and market price are unfavourable for both producers and consumers and are adverse to maintaining basic stability of consumer price. Targeting at such circumstances, relevant government departments monitor 
frozen pork reserve or release by regularly publ ishing production and market price information 
monitoring and timely issuing early information warning in a bid to stabilize market expectations and relieve periodic fluctuations in pork market price.  
 
Question 77 WT/TPR/S/300, page 131, paragraph 4.31  
The Secretariat's report states in paragraph 4.31: Grain reserves for corn, rice, soya beans and 
wheat are maintained by central and local authorit ies to ensure food security. According to the 
authorities, the purchase of the reserves is carri ed out by appointed enterprises at market prices. 
The reserves are managed according to the Regulations on National Grain Reserves . However, to 
manage reserves at the local level, the government at the provincial level will formulate its own 
administrative regulations based on the national regulation. According to the authorities, these reserves were not used during 2012 and 2013.Please describe the additional temporary reserve 
programs for the corn, soybean, cotton, rapeseed and sugar markets.  
 Answer 
Temporary reserve programmes were introduced to safeguard food security. In recent years, the 
international market has been quite unstable due to the development of bio-energy and other non-
traditional factors. Hence, the domestic market is heavily influenced. In light of this, the Government launched temporary reserve programs to maintain stability of the domestic market. WT/TPR/M/300/Add.1 
 
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 The reserves are purchased and sold at market level prices, but are not exported, casting little 
negative impacts on domestic and international markets.  
4 TRADE POLICIES BY SECTOR  
4.2 Services  4.2.1 Telecommunications services  
 
Question 78 WT/TPR/S/300, page 133, paragraph 4.37 :It is the United States understanding that a new 
Telecommunications Law , whose first draft dates back to July 2004, is still being drafted and 
reviewed within the Chinese Government.  
 
a)  When will a draft of the Telecommunications Law  be circulated for public comment? 
 
Answer 
The SCLAO has extensively solicited opinions from relevant administrative agencies, Chinese and 
foreign enterprises, scientific research institutions, experts, scholars and social organizations in 
accordance with China's legislative proced ure requirements after the draft of the 
Telecommunications Law is submitted to the State Council for review, and has repeatedly studied and modified the draft. At present, parties concerned still have different opinions on some 
important issues which must be further demonstrated and coordinated. Hence, when a draft of the 
Telecommunications Law will be circulated for public comment, is yet to be determined.  
 
b)  Does the current draft of the Telecommunications Law  either make MIIT structurally and 
financially separate from all the telecommunications operators and providers or move the regulation of this sector outside of MIIT? 
 
Answer 
According to portfolio of Chinese government agencies, competent telecommunications department under the State Council supervises and administrates national telecommunications 
sector, act as supervisor of telecom operators and suppliers and is entirely independent of telecom 
operators and suppliers.   
c)  Does the current draft of the Telecommunications Law  provide that foreign service 
suppliers required to form joint ventures with Chinese entities to operate in China are free 
to choose their joint venture partner, and that they may choose a partner from a sector 
outside the sector of operation of the joint venture, consistent with the commitment that 
China made in paragraph 314 of the Working Party Report accompanying its WTO Protocol of Accession?  
 
Answer 
The Telecommunications Law is under formulation. Like other laws, the Telecommunications Law 
will be in consistent with China's WTO commitments.  
 
Question 79 WT/TPR/S/300, page 135, paragraph 4.46  
Paragraph 4.46 of the Secretariat's report discusses experimental liberalization in the CSPFTZ with 
regard to telecommunications and Internet-related services. It appears that in most cases foreign participation remains at 50% in this pilot programme, and that no liberalization has been attempted with regard to Internet data centers.   
 
a)  Could China provide more information about how the results of this pilot programme will 
be evaluated? What is the time horizon for evaluating these results? How would success be 
measured?  
 
Answer 
China is considering establishing a follow-up and evaluation system. Since the pilot programme has just begun, there is no more information for the time being.  WT/TPR/M/300/Add.1 
 
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 b)  If the pilot programme is not deemed to be successful, is it possible that the reforms 
would be rolled back? What would happen to the foreign companies that increased their investment participation in the CSPFTZ? 
 
Answer 
All CSPFTZ programmes have gone through deep  and comprehensive consideration. We will 
endeavour to provide governmental services that  will meet the international standards to all 
programmes in the CSPFTZ. All legitimate right and interest in China will be protected by Chinese 
laws.   
c)  Is a secondary phase of experimentation envisioned, when more complete liberalization 
may be attempted in the CSPFTZ? When might it take place?  
 
Answer 
As the Chinese Government explicitly put it in the Overall Scheme of the CSPFTZ, after two to 
three years of pilot reform, we will turn the CSPFTZ into an international pilot free trade zone that 
is characterized by investment and trade facilitat ion, high-efficiency and convenient supervision 
and standard legal environment that meets internat ional standard. In the future, we will gradually 
expand the scope of implementation and scope  of pilot policies according to the CSPFTZ 
advancement and industrial development and radiation needs.  
 
d)  How long might we expect it to take before  the liberalization experiment in the CSPFTZ 
could be extended throughout the country?  
 
Answer  
See the preceding answer. 
 
Question 80 WT/TPR/S/300, page 135, paragraph 4.46  
According to paragraph 4.46 of the Secretariat's report, all but one of the eight value-added 
telecommunications services categories have been liberalized subject to various conditions as of 
March 2014 in the CSPFTZ. The one exception is Internet data centers.   
a)  What is an example of the store and forward services that China has liberalized in the 
CSPFTZ? Would content delivery services be one example of these services?  
Answer 
According to the Catalogue of Classified Telecommunications Operations, store and forward 
services refer to services of transmitting information for users by using the stored and forward mechanism. Services of this kind include voice in box, email, and storage and forwarding of fax. 
Content delivery network (CDN) does not belong to  services of this kind. At present, operating 
CDN business in China is subject to obtaining the business operation license from Internet Data Center (IDC).  
 
b)  One of the services China is liberalizing in the CSPFTZ is online data processing and 
transaction processing, but limited to e-commerce. What is China's definition of 
e-commerce? What is the reason for limiting this liberalization to e-commerce? If an 
e-commerce site such as an online distribution service does its own data processing (e.g., order fulfilment, transaction processing, or payment processing), would it need a value-added telecommunications service license,  or does the CSPFTZ liberalization only 
apply to third-party processing on behalf of e-commerce sites?  
 
Answer 
China believes e-commerce is an interdisciplinar y topic involving trade in goods and trade in 
service, and WTO Members have not reached an agreement on the definition of e-commerce. China is ready to exchange with the U.S. in this regard in the WTO E-commerce Work Plan. 
License application mentioned by the U.S. should  be viewed according to circumstances. An 
enterprise that builds its own online transaction platform and directly provides gratuitous information and sells products to customers only needs to register the website pursuant to relevant laws and regulations instead of applying for the license of value-added telecommunication WT/TPR/M/300/Add.1 
 
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 services. An enterprise that builds its own online transaction platform, offers transaction parties 
information exchange, information processing and other business services and collects corresponding service fees needs to apply for the license of value-added telecommunication 
services. According to Catalogue of Classified Telecommunications Operations, online data and 
transaction processing businesses refer to various data and transaction/business processing application platforms connected with telecommunication network, and provide users through 
telecommunication network the online data processing and transaction/business processing 
businesses. Online data and transaction processing businesses includes transaction processing business, electronic data exchange business and network/electronic equipment data processing 
business.  
 
c)  It appears that Internet data centers are excluded from the CSPFTZ. How does a supplier 
offer a data processing or transaction processing service without an Internet data center? 
In addition, why would the CSPFTZ exclude Internet data centers when foreign suppliers 
already offer these services, including in Shanghai?  
 
Answer 
China doesn't have the condition to further open up Internet data centers and will consider further 
opening measures in the future according to specif ic circumstances. China is willing to discuss with 
WTO Members on the issue of opening up in the Do ha Round Talk. An enterprise may, in light of 
its own needs, rent IDC services from any enterprises which own the brand of IDC.  
 
d)  What is the benefit of the 5% foreign equity liberalization for data processing (i.e., from 
50% to 55%) in one part of Shanghai, when China has already committed under its GATS 
Schedule to allow data processing on a nationwide basis, with no equity limitations?   
Answer   
In its WTO commitments China allows foreign investors to engage in data processing through joint 
venture, with a limitation on foreign equity up to 50%. China believes foreign equity liberalization 
for data processing from 50% to 55% is an opening up measure of important business significance 
because it means foreign investors will have controlling right in the venture. 
 
e)  The United States understands that China has limited the telecommunications service of 
online data processing to 50% foreign equity. However, the United States also assumes, 
consistent with the CPC and the WTO Secretariat Informal note on telecommunications classification dated 3 May 2001, that onli ne data processing services would be 
characterized by the joint supply of both data transmission and data processing, and that a 
mere user of telecommunications (e.g., a data center that buys Internet connectivity from a separate supplier, to be able to link to cust omers) would be able to do so without equity 
limitations. If China does not agree with this characterization, what is China view of the 
scope of permissible activities by a foreign service supplier under China's Computer and 
Related Services GATS commitments covering data processing?   
Answer 
Regarding the classification of telecommunication services and computer services, China has noted 
that WTO Members have maintained a heated di scussion in the CSC and have not finalized a 
conclusion yet. China is ready to continue to communicate with all WTO Members including the 
U.S. in the CSC. According to classification of  WTO service sectors, online data and/or data 
processing service falls into the category of telecommunication services, corresponding to the 
online data processing and transaction processing business in China's Catalogue of Classified 
Telecommunications Operations. 
 Since there is insufficient information about the example given by the US, it is hard to judge which 
type of business it belongs to. Further clarification is needed for answering the question. 
 
f)  The United States notes that, based on the GATS Telecommunications Annex, a supplier of 
online data processing services is guaranteed access to the telecommunications network to 
supply such services as a user, not a supplier of telecommunications. In China's view, other than using a telecommunications network, how else could a data processing supplier offer cross-border services?  WT/TPR/M/300/Add.1 
 
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 Answer 
China has honoured its WTO accession commitments to open up the online data processing and 
transaction processing businesses, in which fore ign equity participation can reach as much as 
50%, and commercial presence is required for cross-border service. According to our 
understanding, there is no relevant stipulation on specific business such as online data processing and transaction processing businesses in the telecommunication annexes of GATS.  
 
4 TRADE POLICIES BY SECTOR  4.2 Services  4.2.2 Financial services  
 
Question 81 WT/TPR/S/300, page 137, Box 4.4  
Box 4.4 demonstrates that even though foreign insurance companies have been approved to 
participate in China's insurance market, the market share of the top five companies in that market is very high, leading to a very concentrated market.  
 
a)  Can China confirm that, for both life insurance and non-life insurance, the top five 
companies are Chinese companies? How large a role does the state play in those companies?  
 
Answer 
According to revenues from insurance premium of property insurance and life insurance companies 
in 2013, top five property insurance and life insurance companies were Chinese companies, 
including state-owned and non-state-owned insurance companies.   
b)  What plans does China have to diminish the concentration of its insurance market?  
 
Answer 
As pointed out in the 12th Five Year Plan for China Insurance Development issued in 2011, we will 
encourage the diversified development of market play ers, adhere to the principles of high standard 
and differentiation to facilitate insurance market system construction in an active and steady way, support qualified state-owned, private and overseas  capitals to invest in insurance companies and 
encourage capital and equity diversification. In addition, the CIRC issued the Opinions on 
Encouraging and Supporting the Sound Development of Private Investment in 2012 to  encourage 
and guide private capital to enter insurance indust ry in a reasonable and orderly way and support 
the scientific and sound development of private insurance institutions.  
 
c)  Can China comment on the number of internal branches that foreign insurance companies 
have been approved for in comparison with domestic companies, including in the past two 
years?  
 Answer 
Subject to the CIRCs permission, two foreign-funded insurance headquarters were opened in 2012 and one in 2013. Foreign-funded insurance companies have established their presence in China for a short time and thus need a development process because of their varying market adaption. The 
CIRC will implement its WTO commitments fully to grant foreign-funded insurance companies 
national treatment and provide equal treatment to all Chinese and foreign insurance companies.   
d)  Does CIRC still maintain one department for reviewing the applications of and issuing 
licenses to domestic insurance company applicants and a separate department for 
reviewing the applications of and issuing licenses to foreign insurance company applicants? If so, what is the rationale for this separation of functions, especially at a time when the 
Third Plenum has called for equalizing treatment between foreign and domestic capital? 
 Answer 
The CIRC is responsible for licensing, reviewing and approving insurance business. More risk factors must be considered for reviewing and approving foreign insurance companies and relevant approval procedures are set for the purpose of prudential regulation. However, national treatment enjoyed by foreign insurance companies is not affected accordingly. WT/TPR/M/300/Add.1 
 
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Question 82 WT/TPR/S/300, page 138, paragraph 4.54  
China's State Council has asked provincial governments to establish new local asset management 
companies. Will these companies be open to foreign investment? If so, will there be any restrictions on the proportion of shares that can be held by a single foreign investor or by foreign 
investors cumulatively?  
 Answer 
Pursuant to the Measures for the Administration of Batch Non-performing Asset Transfer of 
Financial Enterprises (Cai Jin [2012] No.6) printed and distributed by the Ministry of Finance and 
the CBRC in 2012, People's governments of all provinces, autonomous regions and municipalities directly under the central government may set up  or authorize one provincial asset management 
company in principle to engage in batch acquisit ion and disposal of non-performing assets of 
financial enterprises within the local jurisdiction. At present, there is no restriction on the equity structure and shareholders qualification of local asset management companies.  
 
Question 83 WT/TPR/S/300, page 141, paragraph 4.67  
In August 2013, the China Banking Regulatory Commission (CBRC) published draft revised rules 
that restate maximum permitted equity stakes of 20% for a single foreign investor and 25% for 
foreign investors cumulatively in a Chinese bank. The United States is not aware of these draft revised rules having been finalized.   
 
a)  What is the status of these draft revised rules? 
 
Answer 
Please clarify the normative documents in the question.  
 
b)  What in practice does it mean to regulate a bank as a foreign-funded institution, and how 
does it differ from being regulated as a Chinese financial institution? 
 
Answer 
Pursuant to existing Chinese laws and regulations, legal regulation principles and regulation standards are generally equally applicable to both foreign-funded and Chinese banks. China 
formulated some special provisions on the regulati on of foreign-funded banks by referring to best  
international practices and mature experience of other countries according to the characteristics of 
foreign-funded banks for the consideration of pruden tial regulation, such as special provisions on 
domestic currency retail business by foreign-fund ed bank branches and requirements on cross-
border regulation cooperation. Separate regulation  on foreign-funded banks in practice is for the 
consideration of classified regulation, and banking financial institutions in China are regulated by 
classifications of large commercial bank, joint-stock commercial bank, city commercial bank, rural cooperative financial institution and foreign-funded bank, and banking regulators implement 
differentiated regulation on various institutions according to their characteristics when the Law of 
the People's Republic of China on Commercial Banks, the Law of the PRC on Regulation of and Supervision over the Banking Industry and other laws and regulations are equally applicable to 
various financial institutions. However, in general,  regulation standards and measures are same for 
various financial institutions. At present, the CBRC is considering adjusting and rationalizing the classified banking regulation system.   
 
c)  Have there been any instances in which the levels of foreign investment in a listed Chinese 
bank exceeded the 20% or 25% thresholds so that a Chinese bank is regulated as a foreign-funded bank instead of a Chinese bank? If there are no instances of such 
investment levels, do the 20% and 25% thresholds serve as de facto  l i m i t s  o n  f o r e i g n  
investment in Chinese banks? Do Chinese authorities permit foreign banks to surpass the 20% or 25% thresholds so that a Chinese bank becomes regulated as a foreign-funded 
bank?  
 WT/TPR/M/300/Add.1 
 
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 Answers   
Pursuant to Article 8 of the Measures for the Admi nistration of the Investment and Shareholding in 
Chinese-funded Financial Institutions by Foreign Financial Institutions, The proportion of 
investment and shareholding in a Chinese-funded fi nancial institution by a single overseas financial 
institution shall not exceed 20%, and pursuant to Article 9 thereof, where the proportion of the 
investment and shareholding in a non-listed Chinese-funded financial institution by multiple 
overseas financial institutions reaches or exceeds 25%, the non-listed Chinese-funded financial 
institution shall be regulated as a foreign-funded financial institution. Where the proportion of the investment and shareholding in a listed Chinese-funded financial institution by multiple overseas financial institutions reaches or exceeds 25%, the listed Chinese-funded financial institution shall 
be regulated as a Chinese financial institution. In practice, there are no equity stakes of 20% for a 
single foreign investor and 25% for foreign investors cumulatively in a listed Chinese bank. Foreign-funded financial institutions may enter the Chinese banking sector by setting up Sino-
foreign joint venture or wholly foreign-funded bank.  
 Question 84 
WT/TPR/S/300, page 141, paragraph 4.69  
In paragraph 4.69 and Table A4.1, the Secretariat's report describes new qualification requirements and procedures governing the li censing of domestic and foreign insurance 
companies, set forth in the Measures for the Classified Administration of Business Scope for 
Insurance Companies , issued by CIRC in May 2013.These qualification requirements and 
procedures appear to impose unnecessary limits on the scope of insurance products that can be offered by new entrants. For example, they appear to restrict all new entrants to supplying basic 
insurance services.   
 
a)  What does the term basic insurance services mean?  
 
Answer 
The basic insurance services of property insura nce companies include motor vehicle insurance, 
business/household property insurance and engineer ing insurance, liability insurance, ship/cargo 
insurance and short-term health/personal accident insurance. The basic insurance services of life 
insurance companies include general insurance, health insurance, personal accident insurance, participating insurance and universal insurance.  
 
b)  While the qualification requirements and proced ures appear on their face to apply equally 
to domestic and foreign insurance companies, they may disproportionately disadvantage 
large foreign insurance companies attempting to enter China's market. What is the 
rationale behind the Measures for the Classified Administration of Business Scope for 
Insurance Companies restricting all new entrants to supplying basic insurance services?  
 
Answer 
The Measures for the Classified Administration of Business Scope for Insurance Companies are 
equally applicable to Chinese and foreign-funded enterprises. These Measures strengthen internal 
impetus of insurance companies for delicacy operation, service orientation and constant innovation 
by appropriately limiting the business scope of new insurance companies in a bid to facilitate the specialized and differentiated development of insu rance sector and guide the intensive and delicate 
operation of insurance companies.  
 Question 85 WT/TPR/S/300, page 142, paragraph 4.76 : Can China clarify if QFIIs are permitted to trade 
Treasury bond futures, and if they are not, when they will able to do so?  
 Answer 
At present, QFIIs are permitted to trade stock index futures but not Treasury bond futures. 
Treasury bond futures were traded at the Chin a Financial Futures Exchange in September 2013. 
The CSRC will study and include Treasury bond  futures in the scope of QFII investment.  WT/TPR/M/300/Add.1 
 
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 Question 86 
WT/TPR/S/300, page 143, paragraph 4.79 : Can China clarify whether QFIIs are required to 
pay a capital gains tax in China?  
 
Answer 
The CSRC will coordinate with the State Administrati on of Taxation and the Ministry of Finance to 
explicitly define capital gains tax for QFIIs, adop t simple and convenient levying way and eliminate 
uncertainty of tax policies.   4 TRADE POLICIES BY SECTOR  
4.2 Services  
4.2.3 Architecture and construction services   
Question 87 
WT/TPR/S/300, page 144, paragraph 4.87 : Paragraph 4.87 of the Secretariat's report 
discusses China's treatment of architectural services.  
 
a)  What is China's rationale for maintaining a nationality requirement for obtaining an 
architectural license?   
Answer 
China has fully implemented its WTO commitments with regard to market access and national 
treatment, and imposed no nationality requirement on foreigners entering the Chinese 
architectural market.  
 
b)  Can a Chinese national who is a fully licensed Chinese architect be employed by a foreign 
firm in China and be the architect of record?  
 Answer 
According to relevant requirements, a Chinese national who is a fully licensed Chinese architect 
can be employed by a foreign firm in China and practice architect business.  
 
c)  If the fully licensed Chinese architect in the previous question was living temporarily in 
New York, would he or she be able to provide cross-border services to a client in China 
without working in association with a Chinese firm?   
Answer 
According to China's WTO commitments, foreign service suppliers may provide conceptual design 
services through cross-border supply and are required to provide other design services except conceptual design by cooperation with a Chinese firm.  
 
Question 88 WT/TPR/S/300, page 148, paragraph 4.95 : Paragraph 4.95 of the Secretariat's report 
discusses China's treatment of construction services. The data provided show that China has a 
mature construction industry, which is globally competitive and exports more than it imports. What is the rationale for continuing to impose foreign equity caps on joint projects and not 
allowing foreign constructors ( jian zao shi ) except for those from Hong Kong, China, and Macao, 
China?   Answer 
Equity caps on joint projects are restrictions  that China explicitly reserves in its WTO 
commitments. At present, specialized technicians from Hong Kong and Macau are allowed take part in architect examination through agreemen ts and relevant supplementary agreements on 
building closer economic and trade relations between the Chinese Mainland and Hong Kong and 
Macau. China has not signed the Free Trade Agreement with other WTO Members and has not opened architect examination and practice. Therefore, specialized technicians from other WTO 
Members except those from Hong Kong and Macau are not allowed to take part in China's architect 
examination  WT/TPR/M/300/Add.1 
 
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 Part II: QUESTIONS REGARDING THE GOVERNMENT REPORT (WT/TPR/G/300)  
 II. ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMIC POLICY DIRECTION  
2.1 Economic and Trade Environment  
2.1.2 Domestic economic situation   
Question 1 
WT/TPR/G/300, page 5, paragraph 2.3 : In paragraph 2.3, the Chinese Governments report 
states: Consumer prices were basically stable, personal income continued to increase, the supply of money and credit grew steadily, employment stayed at a generally stable level, and the balance 
of payment in current account has maintained basic equilibrium. Does this data indicate that 
China's current account is near its fundamental or equilibrium value? If so, what are the assumptions that underpin this conclusion? If not, does China believe that the current account 
surplus will widen or narrow in the near future?  
 Answer 
In recent years, China's current account has been basically balanced. China has accelerated the change of mode of the economic growth and followed the principles of expanding domestic 
demand, restructuring, surplus reduction and balance promotion since the outbreak of the global financial crisis in 2008. China's ratio between current account surplus and GDP dropped to an 
international recognized reasonable standard si nce 2012 and maintained 2% in 2013. In the first 
quarter of 2014, the ratio between current account surplus and GDP was 0.3%. Under such circumstances, RMB exchange rate also tends to a reasonable equilibrium level and showed two-
way changes recently, indicating the fact that China's current account is near its fundamental 
equilibrium has been gradually accepted in the market. During January-May 2014, the mean price 
of Renminbi exchange rate against US dollar remained weak for five consecutive months and 
accumulatively depreciated by 1.18%. The mean price of Renminbi exchange rage against US 
dollar in the domestic and overseas forward ma rkets showed depreciation and that expected 
depreciation margin in April and May was higher than that in the first quarter.  
II. ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMIC POLICY DIRECTION  
2.3 Adjusting Economic Structure and Transforming Development Pattern  
2.3.1 Adhering to expanding domestic demand  
 
Question 2 WT/TPR/G/300, page 7, paragraph 2.19 : In paragraph 2.19, the Chinese Governments report 
states: China has both investment capability and investment demand, but the key is to invest in 
the proper sectors, optimize the investment structure, and improve its performance and returns. In China's view, what specific reform measures will incentivize financial institutions to invest in the proper sectors and improve [their] performance and returns?  
 
Answer 
Chinese regulators have adhered to prudential re gulation and adopted relevant reform measures 
of streamlining administration and delegating power to the lower levels to cancel and delegate the 
power of administrative approval matters to lo cal governments and further give play to the 
decisive role played by market in resource allocation. Chinese regulators at all levels support 
banking financial institutions to optimize institutional layout according to their market positioning 
and business advantages based on relevant market access principles and encourage qualified banking financial institutions to set up branches and build the network of handy services for the public in less developed and rural areas. We enco urage banking financial intuitions to grant credit 
supports to domestic demand expansion, energy  conservation and environmental protection, 
agriculture and other fields, facilitate the development of consumption credit business, support consumer credit demand for first self-occupation house, staple durable consumer goods, 
education, culture and tourism, carry forward p ilot consumption financial companies, support the 
construction of small and medium-sized common commodity housing and government-subsidized housing, and increase financing supports to private investment.  
 WT/TPR/M/300/Add.1 
 
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 II. ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMIC POLICY DIRECTION 
2.3 Adjusting Economic Structure an d Transforming Development Pattern 
2.3.3 Pursing innovation-driven development an d protecting intellectual property rights  
 
Question 3 WT/TPR/G/300, page 9, paragraph 2.27 : In paragraph 2.27, the Chinese Governments report 
states that the amount of compensation for IPR infringements has been raised, which is to the 
benefit of strengthening the administrative sa nction and criminal punishment against IPR 
infringements. Does the raised amount of comp ensation apply to civil cases in addition to 
administrative and criminal cases? Please explain.  
 
Answer 
The Trademark Law of the People's Republic of China revised in 2013 raises the amount of 
compensation from RMB500,000 to RMB3 million an d adds clauses of determining the amount of 
compensation and punitive compensation by re ferring to the multiple of trademark license 
royalties. Where an infringer is ordered to provide infringement-related account books and 
materials when the right holder has tried its best to provide evidences but infringement-related 
account books and materials are mainly at the hand of the infringer, the People's courts may judge 
the amount of compensation by referring to the right holders claim and evidences it provides.  
 
Question 4 
WT/TPR/G/300, page 9, paragraph 2.28 :In paragraph 2.28, the Chinese Governments report 
states that [t]he court trials of IPR cases are broadcast online, and the relevant information on 
those cases are publicized in accordance with legal requirements and procedures.  
 
a)  Approximately what percentage of court trials of IPR cases are broadcast online?  
 
Answer   
People's courts hear by trail live important cases that attract high social attentions, exert far-
reaching influences, involve big interest dispute an d concern industrial development direction. This 
is one way in which People's courts constantly expand judicial publicity. The Supreme People's 
Court heard one case by trail live, and local Peop le's courts heard a few cases by trial live. At 
present, relevant statistics about the percentage are unavailable.  
 
b)  What does relevant information for those cases mean? How is this information selected?  
 
Answer 
According to the State Councils opinion on publicizing cases of manufacturing and selling fake and 
inferior products and IPR infringement (Guo Fa [2014] No. 6), information on publicizing such cases mainly refers to the administrative penalty decisions, and other information should be made 
public in accordance with the laws and regula tions, including: the administrative penalty 
documents, names of the punished natural person, enterprise or other organization, the names of 
its legal representative, the main facts of violation of laws and regulations or relevant rules, the  
types and basis of administrative penalties, the ways for implementing the administrative 
punishment and deadlines, the names of the law enforcement agencies and dates. The law enforcement agencies include Agriculture, Cult ure, Customs, Industry and Commerce, Quality 
Inspection, Copyright, Forestry, Food  and Drug administrative systems.  
 
c)  Does publicized mean published online, or does it mean published in a hard-copy journal 
or periodical? Please also explain how interested parties can locate the published 
information.  
 Answer 
According to the State Councils opinion on publicizing cases of manufacturing and selling fake and inferior products and IPR infringement (Guo Fa [2014] No. 6), law enforcement agencies should mainly publicize information on cases of manufactu ring and selling fake and inferior products and 
IPR infringement through government websites, or bulletin board, press conference, and 
newspaper, radio broadcast, television. The public can access such information by checking websites of Agriculture, Culture, Customs, Indu stry and Commerce, Quality Inspection, Copyright, 
Forestry, Food and Drug administrative agencies. WT/TPR/M/300/Add.1 
 
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 II. ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMIC POLICY DIRECTION 
2.3 Adjusting Economic Structure an d Transforming Development Pattern 
2.3.4 Advancing energy conservation, pollution  reduction and industrial restructuring  
 
Question 5 WT/TPR/G/300, page 9, paragraphs 2.30-2.31 : In paragraph 2.30, the Chinese 
Governments report states: The Chinese Government continues to carry out the work to close 
down excess and outdated production capacity in  the industries of high consumption and high 
emission such as steel. In paragraph 2.31, the Chinese Governments report explains that China closed down 78 million tonnes of backward steelmaking production capacity between 2008 and 
2012. However, net steelmaking capacity continued to increase in excess of demand during this 
same period. According to a 2013 report by the Ch ina Iron and Steel Association, China's excess 
steelmaking capacity stood between 200 and 300 million tonnes in 2012.  
 
a)  What is the Chinese Government's estimate of the current amount of excess crude 
steelmaking capacity in China? Please al so explain where WTO Members can access the 
information used to reach this estimate. 
 Answer 
In 2012, the percentage of capacity utilization in  the steel industry stood at 72% and crude steel 
production amounted to 720 million tonnes, indicating China's crude steel production capacity of 
about 1 billion tonnes.   
b)  During the past two years, what measures has China implemented to close obsolete and 
inefficient steelmaking capacity and to reduce excess steelmaking capacity? Please also explain where WTO Members can access information about these measures.  
 
Answer 
The Chinese Government has regarded eliminating backward production capacity as an important 
policy to relieve over-capacity for many years. In  respect to industrial policy, China lists blast 
furnaces of 400 cubic meters and below and converters of 30 tonnes and below as backward 
equipment, and publishes relevant information of backward production capacity closed down every year at the website of the Ministry of  Industry and Information Technology.  
 
c)  Despite the measures implemented by China during the past two years, excess 
steelmaking capacity in China continues to grow and capacity utilization rates continue to 
decline. In China's view, why have these meas ures been ineffective in reducing China's 
overall excess steelmaking capacity?   
Answer 
The sustained steelmaking capacity growth in Chin a is attributed to many reasons and the root 
cause is insufficient demand as a result of production capacity formed by high-speed economic development and economic downturn. Solving As a long-term arduous task, solving over-capacity 
cannot be accomplished overnight. China has prop osed a series of measures of consumption 
expansion, backward elimination and industrial integration to relive over-capacity. As China 
adjusts its economic structure, it will gradually solve over-capacity. 
d)  During the past two years, what subsidy programmes has China implemented for the 
technological upgrade of outdated steelmaking capacity? What is China doing to ensure that these subsidy programmes do not result in further increases in excess steelmaking capacity? Please also explain where WTO Members can access information about these 
subsidy programmes.  
 
Answer 
China has not subsidized the technological upgrading in the steel sector.   
e)  What is China doing to ensure that subsidy programmes supporting the closure of 
outdated steelmaking capacity owned by small enterprises and related worker retraining 
will result in the full closure of the relevant steelmaking facilities and will not benefit enterprises that have only partially closed the relevant steelmaking facilities? Please also explain where WTO Members can access information about these subsidy programmes.  WT/TPR/M/300/Add.1 
 
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 Answer 
According to the Notice of the Ministry of Fina nce and the Ministry of Industry and Information 
Technology on Printing and Distributing the Measures for the Administration of Central 
Government Subsidy Funds for Closure of Small Businesses (Cai Qi [2010] No.231), the central 
government subsidy fund for closure of small busine ss is in the form of substitute subsidies with 
rewards to support local governments to make policy closure of small enterprises that have such 
problems as over-capacity, resource and energy waste, environmental pollution, salient safety 
hazard and irrational layout. Subsidy funds ar e mainly used for the expenditures of staff 
resettlement for enterprises closed down.   
f)  China's 12
th Five-Year Plan for Steel announced in 2011 set targets specifying that by the 
end of the 12th Five-Year Plan Period (i.e., by the end of 2015), domestic steel producers 
should account for 90% of the Chinese market for high-strength automotive steel and 
electrical steel, 80% of the Chinese market for high-end products, such as high-speed 
steel rail wheels, and 80% of the Chinese market for certain grades of rebar. Is China on track to achieve these targets? Can China explain what policies have been or will be 
implemented to promote larger domestic market shares for Chinese steelmaking firms and 
to achieve these targets?   
Answer 
To realize the goals developed in the 12th Five-Year Plan for Steel and facilitate the upgrading of 
steel products, relevant state authorities formulated the Guiding Opinions on Accelerating Applied High- strength Steel Reinforcement and amended steel reinforcement use standards. In addition, 
we set up the coordination group for the popularization and application of high-performance 
electrical steel to support the construction of high-performance electrical steel production, application and demonstration platform, and facilitated the localization R&D and application of 
corrosion-resisting steel for ships as well as development and revision of relevant standards and 
codes. We believe we will gradually realize the goals determined in the 12
th Five-Year Plan for 
Steel.   
g)  Is China considering the removal of restrictions on foreign investment in its steel sector?  
 
Answer 
China has imposed restrictions on foreign investment in the steel sector with a view to improving utilization of foreign investment in the steel sector and facilitating restructuring and technological upgrading in the steel sector. This practice conforms to international conventions. Chinese 
enterprises also face qualification examination for their overseas steel investment projects and can 
make investment activities only if they meet co nditions. Next, we will furt her study whether revise 
relevant policies according to actual development of steel sector.   
II. ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMIC POLICY DIRECTION  
2.4 Continuing to Deepen the Reform Steadfastly  2.4.5 Reform of the financial system  
 
Question 6 WT/TPR/G/300, page 13, paragraph 2.49 : In paragraph 2.49, the Chinese Governments 
report discusses improvements that China has made to its [m]arket-based RMB exchange rate 
formation mechanism. What has driven the rece nt period of RMB weakness in the context of 
continued PBC intervention (i.e., buying FX) through April of this year?  
Answer 
U n d e r  t h e  f l o a t i n g  e x c h a n g e  r a t e  s y s t e m  t h a t  i s  b a s e d  o n  m a r k e t  d e m a n d  a n d  s u p p l y  a n d  i s  
managed, the movement of RMB exchange rate mainly depends on changes to international 
balance of payment and is subject to influence of changes to main monetary exchange rates. 
Actually, RMB exchange rate depreciated through February of this year due to seasonable factors in spring and trade deficit in February. In recent  years, outbound travel and shopping by Chinese 
citizens have rapidly increased, equivalent to g oods import, hence it is considered in the market 
that actual trade deficit in February was greate r. Due to changes to international balance of 
payment, the expectation for RMB exchange rate is  changed from single-way appreciation to two-
way appreciation and depreciation. On the other hand, gradual withdrawal from QE by the FED has WT/TPR/M/300/Add.1 
 
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 strengthened the willingness of market institutions  in US dollar overweight and has consequently 
changed trading strategies and behaviors. The decomposition of expectations has facilitated 
changes to supply-demand relationship in the fore ign exchange market in the short run and driven 
depreciation in RMB exchange rate .  
 Question 7 
WT/TPR/G/300, page 13, paragraph 2.50 : China has eliminated any minimum requirements 
for investment by RQFIIs in specific types of securities, but still requires QFIIs to invest at least 50% of their funds in equities. Does China plan to relax this requirement for QFIIs like it has done for RQFIIs? Please explain. 
 
Answer 
To encourage long-term investments and curb pure  arbitrage behaviors, the CSRC requires QFIIs 
to invest at least 50% of their funds in equities. The CSRC will evaluate asset allocation policies 
and overall policies for QFIIs and RQFIIs and timely adjust relevant laws and regulations when deemed appropriate.  
 
II. ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMIC POLICY DIRECTION  3.3 Increasing Utilization of Foreign Invest ment and Outbound Foreign Investment  
 
Question 8 
WT/TPR/G/300, pages 20-21, paragraphs 3.31-3.36 : In paragraphs 3.31-3.36, the Chinese 
Governments report discusses the importance of foreign investment to China's development as an 
open economy and highlights the development of  pilot free trade zones. China also notes the 
importance of a regulatory system for cross-border investment in line with international practices and the rule of law.  
 
a)  Since China is prioritizing foreign investment as one mechanism for economic growth and 
is seeking to create a stable environment for investment, how is China also ensuring that it is advancing effective and democratic representation of workers concerns in the workplace 
in order to reduce labor disputes and provide a stable investment climate?  
 
Answer 
Firstly, enhance the education, publicity and traini ng of labor laws and regulations, include labor 
laws and regulations in occupational training, improve employees' ability to protect their own rights in accordance with laws, guide enterprises to properly understand laws and regulations, and 
strengthen their sense of social responsibility and conscience of engaging employees in accordance 
with laws. Secondly, establish a system of congress of workers and staff members to guarantee their democratic rights and interests, and develop a system of collective contracts consulted collectively in various types of enterprises. Under such a system, employees may collectively 
conduct consultation regarding their remuneration, working hours, vacation and rest, labor health 
and security, insurance and welfare, etc. and co nclude a collective contract. By the end of 2013, 
there had been 1,555,000 collective contracts examin ed by and filed with the Ministry of Human 
Resources and Social Security, involving 157 million employees. 
 b. China also notes its growing focus on outbound  investment in paragraph 3.31, and its priority 
of ensuring that outbound investment be st eady, transparent and predictable. Does China 
have in place measures to provide Chinese investors abroad assistance in complying with foreign countries labor laws and practices in order to help Chinese companies avoid legal and reputational risks? If so, please describe those measures.  
 
Answer 
In 2011, MOFCOM issued Guidance on managing overseas Chinese enterprise staff, which 
regulates the management of overseas Chinese ente rprise (institution) staff, and helps overseas 
Chinese enterprise comply with the host country's employment policies and regulations while adhere to the principle of mutually beneficial and common development. WT/TPR/M/300/Add.1 
 
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 19  QUESTIONS BY CANADA 
Report by the Secretariat – China (WT/TPR/S/300) 
 
Summary  
 Paragraph 15, page 11 
 
With respect to the Shanghai Free trade Zone, it is noted that "China has also adopted measures to gradually liberalize the provision of services outside the CSPFTZ", (with telecommunications of note in particular).  
 
1.  Could China indicate when the provision of services, by sub-sectors, will be gradually 
liberalized outside the CSPFTZ?  
 
Answer 
All the measures in the Framework Plan for China (Shanghai) Pilot Free Trade Zone have been 
basically implemented and all the 23 measures wi th respect to the liberalization of the service 
sector have been adopted. Relevant sectors will be  liberalized gradually in future in the light of 
actual needs.  
Summary  
 Paragraph 22, page 12 
 
It is noted that the procedures to set standards, technical regulations and SPS measures have not been subject to changes since the last Review. No information was available regarding measures 
at the provincial level and their impact on trade.  
 
1.  As transparent and predictable rules are an important element of the multilateral 
trading system, Canada would encourage China to provide some information related 
to standards development and implementation  at the provincial level. Could China 
indicate which system has been put in place for foreign companies to access the provincial level standards requirements?  
 
Answer  
Any individual or organization can look at the local standards catalogue under the column "Notice 
on Local Standards Filing" on the website of the St andardization Administration of China. They can 
also get access to local standards and information on the development or revision of those standards through the bureaus of quality and te chnique supervision of provinces, autonomous 
regions and municipalities directly under the Central Government. 
 
Part 1 – Economic Environment  1.1 Recent Economic Developments 
1.1.2.2 Structural Reform Meas ures: paragraph 1.20, page 19 
 It is noted that at the end of 2011, total expo rts realized nationwide by private enterprises 
reached RMB 635.29 billion, accounting for 33.5% of total exports.  
 
1.  Can China provide data on the value of ex ports in each of the following enterprise 
categories: SOEs, contractual joint ventures , equity joint ventures, wholly foreign-
owned enterprises, collectively-owned enterprises and private enterprises annually 
for 2012 and 2013?  
 
Answer 
1. In this sentence of the report "at the end of  2011, total exports realized nationwide by private 
enterprises reached RMB 635.29 billion" the currency in dicated is wrong. It should be US dollars. 
In 2011 the value of China's total exports was US$1.9 trillion, of which US$635.29 billion was 
realized by private enterprises. 2. Data on the value of exports in each of the following enterprise categories: WT/TPR/M/300/Add.1 
 
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 In 2012, SOEs, US$256.25 billion; contractual joint ventures, US$16.16 billion; equity joint 
ventures, US$287.26 billion; wholly foreign-ow ned enterprises, US$719.21 billion; private 
enterprises, US$768.16 billion. 
In 2013, SOEs, US$248.9 billion; contractual jo int ventures, US$15.69 billion; equity joint 
ventures, US$300.81 billion; wholly foreign-ow ned enterprises, US$727.54 billion; private 
enterprises, US$914.46 billion. 
 
Part 2– Trade and Investment Regime  2.1 Institutional and Legal Frame work: paragraph 2.12, page 36 
 
It is noted that a 30-day period for public comments is provided in accordance with the Legislation 
Law and its relevant regulations. They have also indicated that draft laws are published online for public opinion, except in the case of laws that are required to be kept confidential.  
 
1.  Canada has witnessed in a number of cases that less than 30 days were often 
offered for public submission. Considering that foreign entities needs to translate 
Chinese documents and their submission, could China explain in which context it 
decides to provide only a 10- or 20-day period for public consultation?  
Answer 
Since 2008, with individual exceptions, all the drafts of laws, administrative regulations, and department regulations regarding economy and trade have been published on the Internet, and at least 30 days are offered for public consultation st arting from the first day of their publication.  
 
Part 2 – Trade and Investment Regime  2.1 Institutional and Legal Frame work: paragraph 2.16, page 37 
 
It is noted that complaints from foreign-invested enterprises are handled by the Complaint Coordination Office for Foreign-invested Enterprises and the National Complaint Centre for Foreign-invested Enterprises, both under MOFCOM.  
 
1.  Could China provide more information on  the differences between the Complaint 
Coordination Office for Foreign-invested Enterprises and the National Complaint 
Centre for Foreign-invested Enterprises?  
 
Answer 
Complaint Coordination Office for Foreign-invested Enterprises is responsible for coordinating, guiding and supervising nationwide work regarding complaints made by Foreign-invested Enterprises. It is responsible for dealing with the complaints submitted to it by the National 
Complaint Centre for Foreign-invested Enterp rises which concern so many departments and 
sectors that an Inter-Ministerial Joint Meeting must be convened to find a solution. This Office does 
not directly deal with complaints made by enterp rises. The National Complaint Centre for Foreign-
invested Enterprises handles complaints directly made by Foreign-invested Enterprises, and trans-
province or trans-municipality complaints and major complaints made by Foreign-invested 
Enterprises.  
Part 2 – Trade and Investment Regime 
2.1 Institutional and Legal Frame work: paragraph 2.17, page 37 
 It is noted that the National Development and Refo rm Commission (NDRC) is in charge of devising 
the overall national economic and social developm ent policy. The NDRC is also responsible for: 
conducting research and setting objectives and policies on economic reform and liberalization; and the planning of inbound and outbound investment.  
 
1.  Could China provide more details on the ma ndate and all the responsibilities of the 
National Development and Reform Commission (NDRC) related to China's trade 
policy formulation and implementation, including how the NDRC supports the 
National Leading Group for Comprehensive Deepening Reform?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
As part of its responsibilities, NDRC helps the Ministry of Commerce and other relevant 
departments formulate and implement China's trade policies.  
 
Part 2 – Trade and Investment Regime  2.2.2 Trade Policy Objectives : paragraph 2.20, page 38 
 
It is noted that National Leading Group for Comprehensive Deepening Reform was established as a result of the Plenary Session's decision; it is ta sked with the responsibility of setting a reform 
roadmap, and with the coordination, promotion, an d supervision of the deci sion's implementation. 
To this end, under the Leading Group, six subgrou ps were established: (a) economic reform and 
environmental protection; (b) democracy and rule of law; (c) cultural issues; (d) social issues; (e) reform of the Party's building system; and (f) disciplinary inspection (anti-corruption).  
 
1.  Could China provide the list of Ministries and Agencies participating in the National 
Leading Group for Comprehensive Deepening Reform and the list of Ministries and 
Agencies participating in the six subgroups?  
2.  Could China provide more information on the anticipated timeframe to elaborate the 
proposed roadmap and indicate whether the roadmap will be made public?  
3.  Could China provide more information on the mandate and the objectives of the 
subgroup (a) economic reform and environmental protection?  
 Answers (Questions 1-3) 
The National Leading Group for Comprehensively Deepening Reform has six subgroups for the reform of these areas: economic reform and ecological progress, democracy and rule of law, cultural system reform, social system reform, Party building, and discipline inspection. 
As the most important part in deepening the refo rm comprehensively, economic reform will affect 
and drive the reform in other areas. The subgroup responsible for economic reform and ecological progress will focus on implementing the reform measures already put forth, and make good use of the achievements in the pilot projects and research. It will also enhance coordination so that 
different reform measures supplement each other and progress will be made in the growth of the 
macro economy while pressing problems and difficu lties that people worry about can be solved. 
 
Part 2 – Trade and investment regime 
2.3 Participation in the World Trade Or ganization: paragraph 2.28, page 39 
 
The Secretariat report states that "At the Ninth WTO Ministerial Conference (MC9) in Bali, the 
authorities indicated that an inter-agency mechan ism has been established, which could expedite 
the GPA accession process".   
1.  Can China provide further details on the Ministries and Commissions that will compose this 
inter-agency mechanism, on its mandate and core objectives and the difference with the National Leading Group for Comprehensive Deepening Reform?  
 
Answer 
In 2013 China established the Leading Group for GPA Negotiation. Vice Premier Zhang Gaoli 
served as head of the Leading Gr oup and Minister of Finance and ministers of some other related 
ministries served as deputy heads. Member orga nizations included competent departments of the 
government on GPA, foreign trade, foreign affairs,  and relevant industries and sectors, altogether 
24 departments. The Leading Group makes overa ll plans for the GPA negotiation, discusses and 
resolves major problems rising up in the negotiations, and instructs relevant departments as they 
engage in the negotiations. The Leading Group has its office in the Ministry of Finance that deals with routine work and submits proposals to the Le ading Group for discussion. A deputy minister of 
finance serves as the head of this Leading Group office. 
 The National Leading Group for Comprehensively Deepening Reform is responsible for making 
overall plans for China's reform, coordinating various resources into a joint force for reform, 
strengthening supervision and promoting the implementa tion of the reform's tasks. It is a different 
organization from the Leading Group for GPA Nego tiation. As it pushes forward the reform to 
deeper levels, it will help create the necessary conditions for China to join GPA. The Leading Group WT/TPR/M/300/Add.1 
 
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 for GPA Negotiation will submit proposals on the requ ired reform if China wants to join GPA to the 
National Leading Group for Comprehensively Deepen ing Reform so that it can make overall plans 
in this regard. 
 
Part 2 – Trade and Investment Regime 2.5.1 Regulatory framework and market  access: paragraph 2.52, page 44 
 
It is noted that in addition to anti-trust reviews, FDI involving M&As with Chinese domestic enterprises is subject to national security reviews, if the FDI is related to defence, or is deemed to 
have an influence on national security, for example through control of firms engaged in activities 
involving key commodities (e.g. agriculture, energy, and natural resources), key infrastructure, 
key transport, and key equipment manufacturing with essential technologies.   
1.  Could China provide more information on its national security review? Could China provide 
the criteria used to determine when a national security review is necessary?  
 
Answer 
To promote the sound development of acquisition by  foreign capital and on the basis of thorough 
research and appraisal, and by drawing on the experience of developed countries including the 
United States and Europe, the General Office of the State Council issued in February 2011 Circular 
on the Creation of a National Security Review of Acquisitions of Domestic Enterprises by Foreign 
Investors. This uniform and standardized system of security review of acquisition by foreign 
investors has clearly defined provisions on the range, contents, work mechanism and procedures 
of the security review. 
 Part 2 – Trade and Investment Regime 
2.5.2.1 Inward investment: paragraph 2.59, page 46 
 It is noted that verification is carried out, depending on the size or location of the project, by the State Council, the central NDRC or one of its local branches. Projects in encouraged industries in 
the Catalogue for the Guidance of Foreign Investment Industries valued at over US$300 million 
(US$50 million for restricted industries), and wher e the Chinese party has the controlling stake, 
must be examined by the NDRC, while projects be low these thresholds can be filed, verified and 
approved by local branches.44 Projects valued  at US$500 million or more (US$100 million for 
restricted industries) are submitted for verification to the State Council.   
1.  Could China indicate how the value of the proj ect is calculated in order to determine which 
level of government will be responsible to approve the project?  
 Answer 
In accordance with the Administrative Measures on Foreign-invested Projects, the total value of a project determines which level of government w ill be responsible to approve the project. For 
capital increase project of foreign-invested ente rprises, the newly-added investment is the total 
value of the project. For mergers and acquisitio ns the transaction amount is the total value. 
 Part 2 – Trade and Investment Regime 
2.5.2.1 Inward investment: paragraph 2.64, page 47 
 It is noted that some provinces, autonomous regions and municipalities directly under the Central Government have established one-stop services to help foreign investors with the approval and 
registration process.  
 
1.  Could China provide the list of provinces, au tonomous regions and municipalities directly 
under the Central Government that have es tablished one-stop services for foreign 
investors?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
The Chinese government encourages local authorities to continually optimize their examination 
and approval procedures, improve investment environment, raise the level of investment 
facilitation and provide the best public services fo r all investors. One-stop services are established 
by local authorities in the light of their specific conditions. Currently, we have no information about 
one-stop services across the country. 
 
Part 2 – Trade and Investment Regime 2.5.4. China (Shanghai) Pilot Free Trade Zone (CSPFTZ): paragraph 2.78, page 51 
 
It is noted that the CSPFTZ is meant to expand  and open up the service sectors contribute to 
overall reform and transformation.   
1.  Will restrictions on currency transfers from th e CSPFTZ to and from the rest of China be 
eased?  
 
Answer 
We are in the process of coordinating domestic agencies involved to generate proper details on 
this issue.  
2.  Could China provide the number of domestic and foreign enterprises that have registered 
in the CSPFTZ, and in what sectors, since the Zone's inception?  
 
Answer 
By the end of May 2014 a total of 9589 enterprises have registered in the CSPFTZ. Of these, 1119 
are foreign enterprises. In terms of sectors, 5588 are business or trade enterprises, accounting for 
58.28% of the total; about 2400 are enterprises in the financial sector, accounting for 25% of the 
total.  
3.  Does China plan to open new Free Trade Zone s in the future modeled on the CSPFTZ? Will 
they be opened before the end of the propos ed three year pilot period for the CSPFTZ?  
 Answer 
The Chinese government has approved only the CSPF TZ so far. Our purpose is to gain experience 
that can be copied or popularized in China to push forward its reform and opening up. Research 
and discussions are needed before we make any decision to open new Free Trade Zones similar to 
the CSPFTZ in other areas, and only after asse ssing the CSPFTZ and taking into account the 
demand for further reform and opening up nationwide.  
4.  In addition to facilitating inbound investment, liberalization of outbound investment rules 
for domestic companies is a stated goal of the CSPFTZ. To what extent have Chinese 
entities registered in the SFTZ used it as a platform for investment overseas?  
 
Answer 
Chinese companies outside the CSPFTZ can make investment overseas by means of registering 
branch companies in the CSPFTZ. 
 
Part 2 – Trade and Investment Regime 2.5.4. China (Shanghai) Pilot Free Trade Zone (CSPFTZ): paragraph 2.78, page 51 
 
It is noted that "policies will be tested in the Zone and this will serve as a showcase for further 
trade and investment liberalization nationwide."   
1.  Can China indicate what will be the threshold or gauge for success for the policies to be 
liberalized nationwide?   WT/TPR/M/300/Add.1 
 
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 Answer 
Deepening the reform and opening wider to the outside world is China's fixed goal. The 
establishment of the CSPFTZ can help us gain experience that can be copied or popularized 
throughout the country in furthering our reform and opening up. If our experiment in Shanghai 
proves to be a success, we will popularize th e experience in other areas of the country. The 
criterion is whether it will promote the formation of a business environment featuring  
internationally recognized practices and the rule  of law, and whether economic operations are 
more efficient without causing any uncontrollable risks.  Part 2 – Trade and Investment Regime 
2.5.4 China (Shanghai) Pilot Free Trade Zone (CSPFTZ): paragraphs 2.77-2.93, pages 
51-54  
Canada notes some very interesting developments on the liberalization of financial services in the 
CSPFTZ. However, it is difficult to ascertain details regarding the practical application of some of the financial services reforms. For instance:  
 
1.  Can China please clarify the scope of banking and insurance business that is allowed in the 
CSPFTZ but not currently allowed in other parts of the country?  
 
Answer 
Generally speaking, there is little difference in the scope of baking and insurance business between 
the one operated in CSPFTZ and the one outside CSPFTZ by far. 
 
2.  Can China please clarify whether financial service providers established in the CSPFTZ can 
serve individual or business clients based in other parts of the country?  
 
Answer 
Yes, financial service providers established in the CSPFTZ can serve individual or business clients 
based in other parts of the country. 
 
Part 2 – Trade and Investment Regime 2.5.4. China (Shanghai) Pilot Free Trade Zone (CSPFTZ): paragraph 2.84, page 52 
 
It is noted that "The Negative List will  be adjusted when deemed appropriate". 
 
1.  Can China clarify what it would consider an "appropriate" indicator for reducing the length 
of the negative list?  
 Answer 
Shanghai will revise the negative list to meet the requirement for further liberalizing as stated in the Decision. It aims to increase transparency and the extent of opening up, and follow international rules. 
 
Part 2 – Trade and Investment Regime Section 2.5.4 – China (Shanghai) Pilot Free Trade Zone (CSPFTZ): paragraph 2.87, page 
53 
 The administrative rules calling for the opening up and expansion of certain service sectors are mentioned.  
 
1.  Is it possible for China to provide details of the administrative rules that would be opened 
or expanded with respect to maritime shipping?  
 
Answer 
Please refer to the Circular of the State Council on Printing and Distributing the Overall Plan for 
China (Shanghai) Pilot Free Trade Zone (GuoFa [2013] No. 83), the Implementing Opinions of the 
Ministry of Transport and Shanghai Municipal Pe ople's Government on Carrying out the Overall 
Plan for China (Shanghai) Pilot Free Trade Zone  to Speed up the Construction of Shanghai 
International Shipping Center (Jiaoshuifa [2013] No. 584), the Announcement of the Ministry of WT/TPR/M/300/Add.1 
 
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 Transport on the Trial Implementing Measures for Increasing the Proportion of Foreign Investment 
in International Shipping and International Ship Management in China (Shanghai) Pilot Free Trade 
Zone and the Announcement of the Ministry of Tr ansport Non-Flag international voyage invested 
by China investor Carrying on Coastal Piggyback Business in Shanghai On a Pilot –Basis.  
For more details, please look at:  http://www.ysftpa.gov.cn/WebViewPublic/ item_page.aspx?parentId=627&id=968. 
 
Part 2 – Trade and Investment Regime 2.5.4 China (Shanghai) Pilot Free Trade Zo ne (CSPFTZ): paragraph 2.88, page 53 
 
The Secretariat report also notes in section 2.88 that "capital requirements have also been 
relaxed, replacing the requirement of paid-up capital wi th that of subscribed capital. It is up to the 
shareholders to determine the pledged capital contribution, as well as its mode and time-limit." 
 
1.  Can China please explain to which entities these relaxed capital requirements apply?  
 
Answer 
This reform of registration of enterprises has abolished the requirement for the lowest amount of 
registered capital: RMB 30,000 for limited liability companies, RMB 100,000 for single-person limited liability companies, and RMB 5 million for jo int stock limited companies, except when it is 
otherwise provided for by other laws and administ rative regulations or resolutions of the State 
Council on specialized industries. Unless new amendments are made, the current laws, administrative regulations and State Council resolutions that require paid-up capital for the 
registration of enterprises will still be applicable to banks and financial institutions, security 
companies, futures companies, fund management  companies, insurance companies, insurance 
agencies, insurance agents, direct-sale enterprises, foreign labor cooperation enterprises, 
financing guarantee companies, joint stock limi ted companies, labor dispatch enterprises, 
pawnshops, insurance assets management companies, and micro-credit companies.  According to the Plan for the Reform of the Regist ration of Enterprises issued by the State Council, 
except for the list in the Appendix, other companies can register by means of subscribed capital. It 
is up to the shareholders to determine the pledged capital contribution, as well as its mode and time-limit. 
 
Part 3– Trade Policies and Practices by Measure  3.1 Measures Directly Affecting Imports  
3.1.1 Customs procedures and requirements: paragraph 3.1, page 55 
 It is noted that between January 2012 and October 2013, the GACC issued a total of 138 GACC Announcements and nine GACC Decrees, which have focused, inter alia, on issues such as: 
paperless procedures, the harmonization of customs procedures throughout the country, the 
imposition of anti-dumping duties, and tariff classification.   
1.  Could China provide more information on the measures that were put in place to better 
harmonize the customs procedure throughout the country and to reduce the lack of consistency of customs procedure application between the different ports?  
 
Answer 
Chinese Customs have made great efforts to improve customs environment at ports and make customs procedures more efficient. Over the year s they have adopted many measures to facilitate 
customs clearance. These include declaration in advance, concentration of declaration, making 
appointments in customs clearance, etc. They have effectively promoted trade facilitation. 
 
As a law enforcement department adopting vertical management, Chinese Customs have improved 
law-based procedures and deepened the reform of customs clearance to ensure that custom procedures all over the country are consistent. The following are some of the important measures 
they have adopted: First, legislation work has been strengthened, providing a better basis for 
customs law-enforcement. Second, efforts have b een made to ensure consistency in customs law 
enforcement. This includes newly-established or improved long-term mechanisms for the consistency in law enforcement, such as the mechanism to discover, solve and get feedback on the WT/TPR/M/300/Add.1 
 
- 245 - 
 
  
 inconsistency in customs law enforcement, coordination mechanism for the consistent customs law 
enforcement across regions, standardization of customs practices, administrative explanation 
system, etc. Third, customs discretion is regula ted. The focus is on discretion used in law 
enforcement with respect to unit consumption management, categorization of goods and 
enterprises, and administrative penalties. They ha ve worked out measures to clearly define the law 
enforcement standards and requirement for compliance in order to make customs law enforcement 
follow standard procedures and consistent. Finally , supervision by administrative reconsideration 
has been strengthened to regulate customs law enforcement and correct its mistakes.  Part 3 – Trade Policies and Practices by Measure 
3.1.1 Customs procedures and requirements: paragraph 3.5, page 56 
 The report notes a pilot programme on the Reform  of Classified Customs Clearance which applies 
in certain ports for imports such as Beijing, Tianjin and Shanghai. We understand that customs 
brokers can apply for the classification of A or above if they meet the requirement.  
 
1.  Could China provide the list of customs brokers with the classification of A or above at the 
pilot ports for imports?  
 Answer 
At 26 June 2014, China has a total of 1,718 customs brokers with the classification of A or above. Of these, 164 have the classification of AA-rated enterprises and 1,554 have the classification of A-rated enterprises. The list is fairly long. We suggest Canada contact the Chinese delegation 
resident at the WTO for a detailed list. 
 Part 3 – Trade Policies and Practices by Measure 
3.1.1 Customs procedures and requirements: paragraph 3.7, page 57 
 The report notes that China has the import regime for temporary entry of goods.   
1.  We understand that a deposit is required for a temporary import of goods. Is the amount 
of the deposit equivalent to the amount of tariff and taxes applicable to the ordinary 
import of the same goods?  
 
Answer 
Paragraph 2 of Article 14 of Regulations of the Peop le's Republic of China on Guarantee Relating to 
Customs Affairs reads: "For guarantee provided in  connection with any specific customs service, 
the amount of guarantee shall not exceed the high est amount of duty to be possibly paid or the 
amount specified by the General Administration of Customs." Following the above provisions to the letter, Chinese Customs levy full taxes on the goods as guarantee, including customs duties and 
import taxes. 
 
2.  When the temporary import is re-exported out of China, what is the process to claim a 
refund? How long does it take to receive a refund? 
 Answer 
If the temporary import is re-exported within the time limit of the guarantee that has been 
approved by the Customs, the taxpayer can take  the documents including the customs declaration 
for export for that batch of goods and the receipt of his/her deposit money to the tax guarantee department for examination. If the examination goes through, the tax guarantee department will 
write out a refund certificate, with which the taxp ayer can go to the financial department to go 
through the necessary formalities for the refund .  T h e  r e f u n d  m o n e y  w i l l  g o  d i r e c t l y  t o  t h e  
taxpayer's account. If all the required documents are ready and the examination goes through, it 
won't take long to get the refund. But specifics can differ at different ports. 
 WT/TPR/M/300/Add.1 
 
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 Part 3 – Trade Policies and Practices by Measure 
3.1.1 Customs procedures and requirements: paragraph 3.8, page 57  
It is noted that although China is making efforts to harmonize customs procedures across the 
country, it is also promoting and creating "new special customs supervision areas" that are governed by special regulations.  
1.  Could China provide the list of all those new special customs supervision areas?  
 Answer  
First of all, we want to point out that we don't have the so-called "new special customs supervision 
areas." We do have special customs supervision areas. They refer to the following six areas: 
Export Processing Zone, Free Trade Zone, Free Trade Logistics Park, Free Trade Port Area, Comprehensive Free Trade Zone and Cross-boundary Industrial Zone. In October 2012, the State 
Council promulgated Guiding Opinions on Promoting the Scientific Development in the Special 
Customs Supervision Areas. The existing Export Processing Zone, Free Trade Logistics Park, Cross-
boundary Industrial Zone, Free Trade Port Area and qualified Free Trade Zone will be gradually 
integrated into Comprehensive Bonded Area.  
 Part3 – Trade Policies and Practices by Measure 3.1.4.1 Applied tariffs and Tariff Stru cture: paragraph 3.14, page 58-59 
 
Interim duties are fixed annually by the Tariff Commission under the Regulations on Import and Export Tariffs, and usually apply from 1 January to 31 December of each year; interim duties are 
applied on an MFN basis and effectively replace the MFN duty for the lines that are affected. 
Interim duty rates are lower than the MFN rates and in certain instances the interim duty rate applies to just part of a tariff  
 
1.  Could China please elaborate on the function of these "interim" tariffs, as well as under 
what conditions "interim" rates are applied? 
2.  Could China elaborate on the considerations used to determine the level and duration of 
the applied interim tariff rates?  
 Answer for questions 1-2 
The Chinese government determines and adjusts tariff rates mainly in the light of the production, consumption and importing and exporting of releva nt products, including goods subject to interim 
tariffs, their rates and duration. 
 
Part 3 – Trade Policies and Practices by Measure 3.1.5 Other charges affecting impo rts: paragraph 3.22, page 62 
 
It is noted in the Secretariat report that imports are subject to Value Added Tax (VAT), which is 
collected by Customs on behalf of the State Administration of Taxation. VAT on imports is charged based on the c.i.f. price plus the import duty.  
 
China released in 2004 the Notification of Customs on Adjusting the VAT Policy for Imported Aircraft of Domestic Airlines.  
 
1.  Could China explain which criteria were used to determine that imported aircraft above 
25 tonnes would receive a VAT reduced to 4%?  
 
Answer 
Reduced rates are applied to these aircraft is for such aircrafts are eco-friendly. 
 
2.  Has China considered expanding this reduced rate to imported aircraft below 25 tons to 
enhance fair competition and encourage more eco-efficient solutions?  WT/TPR/M/300/Add.1 
 
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 Answer 
After China implemented the reform of levying Valu e Added Tax in lieu of Business Tax, the import 
VAT for imported aircraft can be credited/deducted, so there is no need to expand the reduced rate 
to imported aircraft under 25 tonnes. At present, China has a 17% statutory VAT for all aircraft 
under 25 tonnes, applicable to both domestic and imported products; therefore, the issue of fairness does not exist. Besides, as far as environmental protection is concerned, most of the 
aircraft flying the main routes in China are medium or big aircraft above 25 tonnes. Reduced rates 
are applied to these aircraft to encourage domestic airlines to import and use such aircraft as they 
are eco-friendly, efficient and advanced; this in itself is a better eco-friendly solution. 
 
Part 3 – Trade Policies and Practices by Measure 
3.1.5 Other charges affecting impo rts: paragraph 3.22, page 62 
 
Agricultural products sold directly by the prod ucer continue to be exempted from VAT, while 
imported goods are not.   
1.  Could China please elaborate upon how this policy is consistent with China's GATT 
Article III commitments?  
 Answer 
Regarding this policy, China has made explanation and clarifications for several times including last TPR of China. In summary, we have the following points to make. First of all, China has a huge number of small farmers across the country, which makes it impossible to conduct accounting and 
tax filing. In other words, to levy value-added tax upon them is infeasible and uneconomical 
because of the huge administrative cost. This is the fundamental reason behind the policy. Second, 
in China the agricultural production is mainly based on household operation. The sales scale is very 
small. The VAT exemption is applied only to farm ers who sell their own products in an open air 
market. This is completely different from the import of products in bulk. Their VAT policies are not comparable. Third, as far as we understand, ot her members with a VAT system also seem to 
exempt VAT from farmers who sell their own products, while levying tax over imported agricultural 
products. Fourth, even if we apply VAT over these farmers, we would adopt a policy that would 
establish a commercially-meaningful threshold like in other countries. Most farmers would fall below the threshold. The real effect would be the same as the current policy. Therefore, China 
does not believe the current policy is not in compliance with its WTO obligations. 
 Part 3 – Trade Policies and Practices by Measure 
3.1.6 Import Prohibitions, Restrictions, and Licensing: paragraph 3.27, page 64 
 The Secretariat report states that China has "apparently" not applied any import quotas during the period under review, although import quotas were last notified to the WTO in 2009.  
 
1.  Could China indicate whether it intends to provide updated notifications to the WTO 
Secretariat on its use of import quotas in the near future?  
 
Answer 
China does not maintain any import restriction measures that do not conform to WTO rules. 
 
Part 3 – Trade Policies and Practices by Measure 3.1.6 Import prohibitions, restrictions , and licensing: paragraph 3.30, page 65 
 
China's legislation also allows the authorities to restrict imports to allow for the establishment of a 
particular domestic industry or to accelerate its development. Imports of agricultural, animal and fish products may also be restricted if the circumstances so require (Article 16 of the Foreign Trade 
Law). According to the authorities, this provision has never been used. 
 
1.  Could China please elaborate upon how these policies are consistent with China's GATT 
Article XI commitments? Under what circumstances and conditions could this provision be 
enacted?  
 WT/TPR/M/300/Add.1 
 
- 248 - 
 
  
 Answer 
In reality, the Chinese government has never adopted the measures of restriction or prohibition in 
import/export under the paragraph 7 and 8 of Article 16 in the Foreign Trade Law. 
 
Part 3 – Trade Policies and Practices by Measure 3.1.7.1 Anti-dumping measures: paragraph 3.37, page 67 
 
It is noted that China's investigating authority requires sufficient evidence of the existence of dumping, injury and a causal link in order to self-initiate an anti-dumping investigation.  
 
1.  Could China please elaborate on the circumstances under which it would decide to self-
initiate an investigation and the procedures it would undertake for evidence gathering when considering a self-initiation?  
 
Answer 
According to Article 18 of the Anti-dumping Regula tions of the People's Republic of China, under 
special circumstances, the Ministry of Commerce may decide to initiate an investigation in the 
absence of an application. The Ministry of Comme rce has not made any self-initiation yet. If it 
decides to self-initiate an investigation, the Chin ese investigating authority will collect the evidence 
through authentic, reliable, available channels , and shall comply with statutory initiation 
standards. 
 Part 3 – Trade Policies and Practices by Measure 
3.1.7.1 Anti-dumping measures: paragraph 3.37, page 67 
 It is noted that MOFCOM is responsible for determining the existence of dumping, injury and 
causation and the State Council Tariff Commission (SCTC) makes the final decision as to whether 
to impose anti-dumping duties based upon a proposal by MOFCOM.   
1.  Could China please indicate whether there are opportunities for interested parties to make 
representations to the SCTC before it makes its final decision?  
 Answer 
According to Article 38 of the Anti-dumping Regula tions of the People's Republic of China, the 
proposal imposing an anti-dumping duty shall be put forward by the Ministry of Commerce, and, on the basis of such a proposal, the State Council Tariff Commission shall make a decision which 
shall be published by the Ministry of Commerce. 
 
2.  Canada understands that MOFCOM submits recommendations to the SCTC concerning the 
imposition of definitive duties. Can the SCTC completely reject MOFCOM's decision 
recommendation or apply duties at a different rate than that proposed by MOFCOM?  
 Answer 
According to Article 38 of the Anti-dumping Regula tions of the People's Republic of China, the 
proposal imposing an anti-dumping duty shall be put forward by the Ministry of Commerce, and, on the basis of such a proposal, the State Council Tariff Commission shall make a decision which 
shall be published by the Ministry of Commerce. 
 
3.  Is the SCTC also responsible for making the final decision in countervailing investigations?  
 
Answer 
According to Article 39 of the Countervailing Regula tions of the People's Republic of China, the 
proposal imposing the countervailing duty shall be put forward by the Ministry of Commerce, and, 
on the basis of such a proposal, the State Council Tariff Commission shall make a decision which 
shall be published by the Ministry of Commerce. WT/TPR/M/300/Add.1 
 
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 Part 3 – Trade Policies and Practices by Measure 
3.1.7.1 Anti-dumping measures: paragraphs 3.39-41, page 67  
It is noted that China does not generally apply provisional duties for longer than four months 
except under "special circumstances", which refers to when the investigating authority examines whether a lesser duty would be sufficient to remo ve the injury. However, at final determination 
China does not examine whether a lesser duty could be applied.  
 
1.  Could China please describe the procedural process and standards by which determinations 
regarding "special circumstances" are made?  
 
Answer 
The clause of "special circumstances" is to cover the situations that have not been experienced 
currently and may occur in the future. Such situation shall be usually assessed and judged case by 
case.  
Part 3 – Trade Policies and Practices by Measure 
3.1.7.1 Anti-dumping measures: paragraph 3.40, page 67  It is noted that the imposition of anti-dumping duties must be in the public interest, but that there 
are no rules specifying how to do this. 
 
1.  As transparent and predictable rules are an important element of the multilateral trading 
system, could China please indicate if there are any plans to develop rules on how to 
factor-in public interest for considering whether to impose a measure?  
2.  Has there been any instance where China decided not to impose a measure on the basis of 
public interest?  
 Joint answer for questions 1 and 2 
According to Article 37 of the Anti-Dumping Regula tions, imposition of anti-dumping duty shall be 
in the public interest. In an anti-dumping inve stigation, Chinese investigation authority holds 
hearings and meetings to allow all interested parties, including manufacturers and exporters involved in the case, involved governments, up stream and downstream enterprises and related 
industry associations and importers, to express their views, and seriously considers their 
arguments, so as to ensure an objective, impa rtial and fair investigation. The investigation 
authority will review specific considerations case by case. 
 
Part 3 – Trade Policies and Practices by Measure 3.1.7.1 Anti-dumping measures: paragraph 3.43, page 68  
It is noted that MOFCOM may carry out its investigations by using a sampling method when the 
number of exporters, producers, types of products or transactions is so large that it would be unduly burdensome and prevent the timely completion of the investigation. It is also noted that 
exporters and producers may provide information to MOFCOM on a voluntary basis.  
 
1.  Could China please elaborate on what is considered a burdensome number of exporters, 
producers, types of products or transactions?  
 Answer 
When determining whether to conduct sampling, the investigating authority need to assess specific 
circumstances, such as product information, workload and administrative resources of the 
investigating authority and so on.  
2.  Could China please explain how it treats information provided voluntarily by non-sampled 
exporters and producers?  
 
Answer 
On the premise of not affecting the timely co mpletion of an investigation procedure, the 
investigating authority may determine a individual rate for the enterprise that voluntarily provides information. WT/TPR/M/300/Add.1 
 
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 3.  How is the margin of dumping determined for exporters and producers who provide 
information on a voluntary basis?  
 
Answer 
In practice, if a non-sampled exporter voluntarily provides information, the investigating authority 
may determine an individual dumping margin for it where practicable. If an individual margin is 
not made, the non-sampled exporter or producer will obtain the weighted average duty. 
Part 3 – Trade Policies and Practices by Measure 3.1.7.1 Anti-dumping measures: paragraph 3.45, page 68  
It is noted that parties not satisfied with a MOFCOM decision may request an administrative 
reconsideration by the Department of Treaties and Law or may bring the case directly to the court.  
1.  Could China please provide more information on the differences between these two 
options? For example, who can request such actions and are the standard of review and 
possible remedies identical?  
 
Answer 
If interested parties refuse to accept the ruling on the case, interested parties may choose to apply to the Department of Treaty and Law of the Mini stry of Commerce for administrative review or 
submit the case to the court for a judicial review. However, the procedures between the two are  
different, and they should be conducted in accord ance with the Administrative Review Law of the 
People's Republic of China and the Administrative Litigation Law of the People's Republic of China.  
 
Part 3 – Trade Policies and Practices by Measure 3.1.7.1 Anti-dumping measures: paragraph 3.48, page 69 
 
It is noted that MOFCOM may initiate an interim re view, ex officio or upon request of an interested 
party, provided that a reasonable period of time has elapsed.  
1.  Could China please provide more information on the circumstance under which it may 
decide to self-initiate an interim review and which evidence would be taken into consideration?  
 
Answer 
The Ministry of Commerce has not had any practice of initiating interim review investigations on its 
own. 
 
2.  Could China please clarify what it considers to be a reasonable period of time elapsed?  
 
Answer 
The provision of "after a reasonable period of time" recognizes that changes may occur after the 
implementation of the measure. Usually a reasonable  period of time should be more than a year. 
 
Part 3 – Trade Policies and Practices by Measure 3.1.8.1 Standards and technical regu lations: paragraph 3.66, page 73 
 
The Secretariat report notes that local standards may be developed where neither national nor industry/sectoral standards exist. However, once equivalent national standards are developed, these replace local and industry/sectoral standards.  
 
1.  Could China indicate how these local/industry/sector standards are repealed once the 
national standard comes into effect?  
 
Answer 
According to the Standardization Law, the auth orities, which approve and publish local and 
industry standards can repeal such standards.  
 WT/TPR/M/300/Add.1 
 
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 2.  Could China explain how all the local and key st akeholders are informed of the modification 
and what is the usually transition period for companies to comply with the new national standards that replace the local/industry/sectoral standards?  
 
Answer 
On the revision information about the local standards, you can query local standard directory 
through the "announcement on local standard filing" section of the SAC website, and such 
information is also available directly through relevant sections of the websites of the bureaus of quality and technical supervision of provinces, autonomous regions and municipalities directly 
under the central government. 
 
Part 3 – Trade Policies and Practices by Measure 3.1.8.1 Standards and technical regu lations: paragraph 3.67, page 73 
 
It is noted that there are other organizations such as the China Association of Standards (CAS) and non-governmental organizations affiliated to AQSIQ that support SAC and other institutions in 
the development of standards through research and international cooperation to promote the use 
of best international practices in the development of China's standards so that they comply when possible with existing international standards.  
1.  Could China explain in detail the process for a foreign company to register for or 
participate in a particular technical committee that develops specific standards?  
2.  Could China indicate whether a company may submit written comments/proposals to a 
technical committee for consideration and how comments should be submitted?  
 Joint answer 
China welcomes legally registered foreign-funded enterprises in China to participate in China's national standardization activities. In participation in technology committee activities, the SAC will recruit committee member in public through the SAC website before the establishment or change 
of the term of office of each technology co mmittee. Related parties can file an application 
according to related information about public re cruitment of committee members. The enterprise 
(regardless of domestic or foreign funded) which would like to join China's technology committee should file an application according to the requ irements of the Administration Provisions on 
National Professional Standardization Technology Committee (Guo Biao Wei Ban [2009] No. 3) 
(hereinafter referred to Provisions). The specific procedure are as following: 1) Enterprise experts fill in the Registration Form for Members of the National Standardization 
Technical Committee; 
2) Enterprise recommends experts to technical committee
（attached with the Registration Form 
for Members of the National Standardization Technical Committee; 
3) The secretariat of technical committee sha ll review committee membership and implement 
approval process within the technical committee; 4) The technical committee will submit the applicat ion of committee member to be adjusted to the 
department in charge of the industry for review , and such department will submit the application 
to the SAC for examination and approval after its approval. The technical committee directly under the SAC shall directly submit its application for member adjustment to the SAC for approval. In 
principle, the members of the technical committee are allowed to be adjusted only once a year; 
5) Where the application for member adjustment of  technical committee is in conformity with the 
requirements of the Provisions, the technical committee can handle the appointment letter of members after the approval of the SAC. 
6) The Provisions, Registration Form for Members of the National Standardization Technical 
Committee and relevant information on technical committee are available on the SAC website (http://www.sac.gov.cn), and any interested pa rty may submit its written comments and 
suggestions to the Technical Committee. 
 WT/TPR/M/300/Add.1 
 
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 Part 3 – Trade Policies and Practices by Measure 
3.1.8.1 Standards and technical regu lations: paragraph 3.67, page 73 
 
It is noted that the Standardization Administration of China (SAC), under AQSIQ, continues to be 
the agency that centralizes the administration of the standardization system in China. The SAC is 
assisted by the National Development and Reform Commission (NDRC), the State Food and Drug 
Administration, the China Association of Standards (CAS), a number of ministries, and local and 
industry standardization associations.   
1.  As a high number of governmental entities are responsible for developing standards, could 
China indicate which mechanism, other than the WTO notification process, China uses to 
disseminate the information on all the new standards that are created by the different ministries and agencies at the central and local level?  
 
Answer 
Industry standards and local standards are develope d and released by the department in charge of 
industry standardization and local standardizat ion authorities, and standard information is 
available at the website of appropriate agencies. According to the provisions of the Standardization Law, after the release of industry standards an d local standards, these standards should be 
submitted to the authorities under the State Council in charge of standardization for the record. 
The SAC releases the information about industry standards and local standards for filing on the 
official website http://www.sac.gov.cn in the form of announcements on a regular basis.  
2.  Could China describe the role of the Ministry of Industry and Information Technology 
(MIIT) in developing standards, and elaborate on which specific standards are developed by MIIT?  
 
Answer 
The Ministry of Industry and Information Technology  is responsible for standardization work of its 
own department and industry as relevant admi nistrative department under the State Council. 
According to the relevant provisions of th e Regulations for the Implementation of the 
Standardization Law of the People's Republic of China, the Ministry of Industry and Information 
Technology is mainly responsible for development and revision of industry and telecommunications 
industry standards, involving chemical industry , petrochemical industry, ferrous metallurgy, non-
ferrous metals, rare earth, gold, building material s, machinery, automotives, shipping, aviation, 
light industry, textile, packaging, aerospace, ordnance products for civilian use, nuclear, 
electronics and communication in 19 industries. 
 Part 3 – Trade Policies and Practices by Measure 3.1.8.1 Standards and technical regu lations: paragraph 3.68, page 74 
 
The report noted that national standards are formulated by SAC, through an eight-step process: feasibility study, research, project design, drafti ng of proposed standard, comments, examination, 
approval and publication. National standards are reviewed after five years of implementation and 
might be amended or annulled as required.   
1.  Could China indicate at which steps foreign entities are able to participate in the 
formulation of the national standard?  
 Answer 
The national standards shall be formulated by the administrative department of the State Council in charge of standardization. The formulation proc edure is divided into such 9 phases as advanced 
research, project approval, drafting, soliciting opinions, review, approval, publish, re-examination 
and repeal to be consistent with the ISO standards. The development process of national 
standards is open and transparent. Stakeholders can make comments and suggestions on the following stages: first is at project approval stage to post the proposed project of national 
standards for approval on the SAC website for public comments. Second is at soliciting opinions 
stage that the technical committee will print and distribute standard draft to related primary production, distribution and use, research and insp ection units and universities for advice. Third is 
during the ratification stage that mandatory national standards projects involving international WT/TPR/M/300/Add.1 
 
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 trade shall be notified to the World Trade Organization (WTO) Secretariat in accordance with the 
relevant provisions of WTO, and solicit the co mments from WTO members. In terms of important 
national standards, the SAC will also post the draft standards on the SAC website for public 
comment before approval and release. 
 
2.  What is the typical timeframe from the initiation of the feasibility study to the publication?  
 
Answer 
The general period for national standards from ad vanced research to release normally lasts for 
3 years. 
 
3.  Could China describe the review process?  
4.  Could China explain under what circumstances a national standard could be annulled?  
 
Joint answer to questions 3 and 4 
5 years after implementation of national standards, technical committee will re-examine the 
national standards, make recommendations for re maining in force, amending or repealing, and 
submit them to the SAC for approval. In terms of the national standards that are not necessary to 
exist, the SAC will repeal them in the form of announcement.   
Part 3 – Trade Policies and Practices by Measure 
3.1.8.1 Standards and technical regu lations: paragraph 3.69, page 74 
 
China notified 167 measures during the review pe riod, the vast majority of which were under 
Article 2.9 of the WTO Agreement on Technical Barriers to Trade. Canada notes that China has stipulated that its specified consultation period for technical regulations is set at "no less than two 
months". Canada is concerned that interested stakeholders may not have sufficient time to 
meaningfully comment on China's proposed technical regulations.   
1.  Could China provide more information on how it determines the start and end dates of its 
consultation period for technical regulations?  
2.  Could China clarify the process for interested parties to participate or submit comments?  
 
Joint answer to questions 1 and 2 
In strict accordance with the relevant provisio ns of the WTO/TBT, the SAC will notify the WTO 
Secretariat of compulsory standards projects that did not adopt international standards and have 
major impact on international trade, set comment period, and solicit comments from WTO 
Members. If so requested by a WTO Member, it  may appropriately exte nd the comment period. 
 
3.  Does the minimum 2-month consultation period apply to sub-federal and local regulations 
as well?  
 Answer 
Setting procedures of local standards and industry standards shall refer to the setting procedures of national standards.  
4.  Could China clarify whether MOFCOM's China Foreign Trade and Economic Gazette covers 
federal, provincial and local proposed regulations?  
 Answer 
From the release in 2002 to the end of May 2014,  923 MOFTEC Gazettes have been published and 
distributed, and a total of 5,266 documents have been published (including 196 drafts for public comment). Formally, including the following categories: (A) the laws, decisions of the National 
People's Congress and its Standing Committee, and the legal interpretation published by the NPC 
Standing Committee; (B) the administrative regulations, and decisions promulgated by the State Council; (C) judicial interpretations issued by the Supreme People's Court and the Supreme 
People's Procuratorate; (D) local regulations, autonomous regulations and separate regulations; 
(E) departmental rules, and rules and regulations of local governments; (F) the measures pertaining to or affecting trade in goods, trade in services, trade-related aspects of intellectual property rights or the control of foreign exch ange. For example, various types of regulatory WT/TPR/M/300/Add.1 
 
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 documents, national, sector and local standards, and matters and measures released according to 
the provisions of law, rules and regulations; (G ) international treaties concluded by China. For 
example, free trade agreements, agreements on  investment protection, and agreements on 
avoidance of double taxation; (H) draft laws, rules, regulations and other measures submitted for 
public comment.  
5.  Does the comment period for Gazette notifications take account of the notification 
obligations under the WTO Agreement on Technical Barriers to Trade?  
 Answer 
In order to fulfill transparency obligations under the Protocol on China's accession to the WTO, China Foreign Trade and Economic Gazette released by China and the documents on announcements of publishing gazette are seen in the answer for question 4. The draft technical 
standards are also posted on the website of th e competent department concerned when soliciting 
public opinion.  
Part 3 – Trade Policies and Practices by Measure 
3.1.8.2 Product Certification: pa ragraphs 3.73-76, pages 75-76 
 Under the CCC system, only products tested, inspected and certified by Conformity Assessment 
Bodies (CAB) recognized by the Certification and Accreditation Administration of the People's 
Republic of China (CNCA) can be sold in China. There are 13 mandatory certification bodies which are all domestic entities.  
 
The process companies must follow in order to test and certify their products under the CCC system are lengthy, complicated and costly. This process can also lead to the duplication of work, 
as the same product is often already certified for sale in Canada by a Canadian certification body. 
China committed that it "would not maintain multiple or duplicative conformity assessment procedures" in its Protocol of Accession (paragraph 192).   
1.  Could China provide the entire list of the 13 mandatory certification bodies?  
 Answer 
At present, there are 13 certification bodies ac credited by the Certification and Accreditation 
Administration of the People's Republic of Ch ina. These certification bodies are engaged in 
compulsory product certification. The specific directory and scope of designated business are 
described in the Bulletin of the CNCA on the Designated Certification Bodies for Compulsory 
Product Certification and Laboratory Directory as well as Business Scope (CNCA Bulletin No. 13 in 2013).  
2.  Does China anticipate a review of the CCC Catalogue in the near future?  
 Answer 
To increase the suitability of CCC certification directory management to the needs of laws and 
regulations, industrial policy and the product development as well as the normalization of product input and output directory, the CNCA has set up and implemented a dynamic adjustment 
mechanism of the directory on the basis of risk anal ysis for the existing products in the directory. 
In 2012, 8 kinds of products like flexible rubber sheathed cables for mining purpose were moved out of the directory. At the same time, higher risk products such as part of fire protection products 
and restraint systems for children in motor vehicle were included into the scope of mandatory 
product certification management. 
 
3.  Canada understands that China recognizes IECE E-CB test certificates from other IECEE-CB 
members. Does China maintain a list of products for which it recognizes these certificates? 
Can IECEE-CB test certificates be  accepted for CCC certification?  
 
Answer 
According to IECEE-CB rules, China recognizes the test certificates issued by other members of the 
IECEE-CB, and the corresponding product list of such recognized test certificates corresponds is available at official IECEE website. WT/TPR/M/300/Add.1 
 
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 4.  Canada understands that China is amenable to accrediting foreign conformity assessment 
bodies (CAB) through mutual recognition agreements. Could China list its agreements and the scope of products covered?  
 
Answer 
The mutual recognition of Sino-foreign conformity  assessment bodies is performed in a bilateral 
framework. The content of such agreement and the range of products covered are decided by 
specific agreements.  
5.  Does China have a framework in place to facilitate such bilateral arrangements, and if so, 
which Chinese authority would be the lead to approach to discuss such an agreement?  
 Answer 
The CNCA is responsible for the launching of the bilateral mutual recognition agreements, and actively facilitated such agreement. Specific b ilateral agreements on mutual recognition will 
determine the working framework as the case may be.  
 
Part 3 – Trade Policies and Practices by Measure 3.1.8.2 Product Certification: pa ragraphs 3.73-76, pages 75-76 
 
While not specifically referenced in the Secretariat report, Canada notes that China changed the 
interpretation of its cosmetics law related to require certification for imported cosmetic products into China under the Cosmetics Hygiene Management Regulation (CHMR). This new interpretation 
emphasizes that licensing applications for imported products require a certificate to be submitted 
by the cosmetic manufacturer to Chinese evaluati on centers to prove that the product has been 
sold or manufactured in the country of origin. This requirement differs from China's previously 
accepted interpretation where the Certificate of Free Sale only had to state that the cosmetic 
product was permitted to be sold in the country of origin. Canada notes that Chinese manufacturers are exempt from pre-market registra tion. This additional demand causes significant 
delays to the launch of new products and increases costs for importers.  
 
1.  Could China please explain the necessity for requiring Certificates of Free Sale for cosmetic 
products from importers but not from domestic manufacturers?  
 
Answer 
1. It is the "Certificate of Manufacturing and Sale" as prescribed in Article 3 and Article 4 of the 
Requirements for Application Materials for Administrative Licensing of Cosmetic Products (No. 856 
[2009], State Food and Drug Administration) as issued by the former State Food and Drug Administration in 2009, other than the Certificate of Free Sale as mentioned by Japan and Canada, that needs to be submitted in the application for imported cosmetic products. 
2. In order to protect the consumption safety of nationals and prevent some enterprises from 
treating consumers of import states as the first trial group, in the import of cosmetic products, the "certificate of manufacturing and sale in the country (region) of manufacturing or country (region) 
of origin" shall be submitted. This provisio n was announced to the WTO member states in 
accordance with the WTO/TBT rules in 2009. 3. Such materials shall be submitted in the application for administrative licensing of cosmetic 
products. When a domestic manufacturer files an application, its products may not be 
manufactured or sold before its products obtain approval, it of course fails to submit the "certification of manufacturing and sale." Domestic manufacturers are exempted from submitting the said materials, which is a matter of logic se quence in the launch procedure of products other 
than a special treatment for domestic enterprises. 
 Part 3 – Trade Policies and Practices by Measure 
3.1.8.2 Product Certif ication: paragraphs 3.73-76, pages 75-76 
 In addition to the CMHR rules for cosmetics, Canada notes that there are variations in the process 
for registering ingredients for use in cosmetics. The China Food and Drug Administration's (CFDA) 
approval and registration process for cosmetics and the procedures for approving new ingredients are becoming a serious barrier to trade. The "positive list" approach reduces access to safer and more innovative cosmetic products. In addition, China's "new ingredient" registration approval WT/TPR/M/300/Add.1 
 
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 process decreases competitiveness in the cosmetic industry. Canada notes that Chinese cosmetic 
manufacturers benefit from a different domestic registration process for "new ingredients" that is much less burdensome than the one applied to foreign cosmetic manufacturers.  
 
1.  Could China please explain the reason for the differences in approval processes for 
domestic and foreign cosmetics manufacturers and why China is not accepting cosmetic 
ingredients already approved and considered safe in other leading foreign jurisdictions?  
 Answer 
China adopts the same procedure and approval pr ocess for registration of new ingredients of 
cosmetic products to both domestic and foreign enterprises. The statement of Canada that 
"Chinese cosmetic manufacturers benefit from a different domestic registration process for 'new ingredients' that is much less burdensome than the one applied to foreign cosmetic 
manufacturers" is not true. 
First, before the manufacturing and sale of cosmetic products, domestic cosmetics enterprises need to obtain the manufacturing license from the provincial food and drug administrative 
departments and they also need to accept routine supervision of the administrative departments at 
various levels during manufacturing. Their products  are subject to the supervision and guidance of 
administrative departments in the whole manufacturing process; for imported products, the administrative departments determine their safety only by approval of such products (final 
products). Based thereon, in accordance with China's current regulations, China implements 
recordation and examination of domestic non-special-purpose cosmetic products and implements  
administrative licensing of imported non-special-purpose cosmetic products; however, the safety 
requirements for enterprises and products as well as the required materials are the same. 
Second, the setting of the approval process is ba sed on the provisions of the Regulation on the 
Hygiene Supervision over Cosmetics as issued in 1989. Strict implementation of the current 
regulations is also a requirement for law-based administration. 
Third, the statement of Canada that "why Chin a is not accepting cosmetic ingredients already 
approved and considered safe in other leading foreign jurisdictions" is unclear and lacks operability. There is no international standard for "leading jurisdictions." On the issue of health-
related products, China welcomes all products as long as they are safe and legal and China will not 
choose a discrimination policy due to the economy of the export country and other differences.  
Part 3 – Trade Policies and Practices by Measure 
3.1.8.2 Product Certif ication: paragraphs 3.73-76, pages 75-76 
 
Canada notes that China recently issued Order No. 650 of the State Council - Regulations for the 
Supervision and Administration of Medical Devices. Canada notes that imported medical devices must undergo product testing and clinical trials in China. Canada is concerned that China may be requiring unnecessary and duplicative testing and clinical trials for medical devices that have 
previously met the requirements for approval in other jurisdictions, including Canada. This 
situation would result in additional time and ex pense being incurred by medical device exporters 
wishing to enter the Chinese market. 
 
1.  Could China please explain the rationale and process for requiring product testing and 
clinical trials in China for imported medical devices that have already received approval in 
other jurisdictions?  
 Answer 
On 31 March 2014, the State Council issued the newly-revised Regulations for the Supervision and 
Administration of Medical Devices. It is specified that "these Regulations are developed for the 
purposes of ensuring the safety and effectivene ss of medical devices and guaranteeing the human 
health and safety of lives." "The product inspection report in the application materials for the 
registration of Class II and Class III medical devices shall be the inspection report issued by the 
medical device inspection institution; clinic assessment materials shall include clinic trial reports except medical devices free from clinic trials in accordance with the provisions of Article 17 of 
these Regulations." "The filing of Class I medical devices does not require clinic trials. In the 
application for registration of Class II and Class III medical devices, clinic trials shall be conducted; however, under any of the following circumstances, medical devices may be free from clinical trials: WT/TPR/M/300/Add.1 
 
- 257 - 
 
  
 (1) they have specific operating mechanism,  finalized design, and mature manufacturing 
technique, the medical devices of the same variety that have been launched have been put into clinical practice for multiple years and there is no any record of severe and adverse event, and the 
general purposes are not changed; 
(2) it can be proved that such medical devices are safe and effective through non-clinic assessment; and 
(3) it can be proved that such medical devices are safe and effective through clinic trials of medical 
devices of the same variety or analysis and ev aluation of data obtained from clinic use. 
"The catalogue of medical devices that are free from clinical trials shall be developed, adjusted and 
issued by the food and drug administrative department of the State Council." 
At present, the China Food and Drug Administration is organizing the development and revision of 
the Measures for the Registration and Administration of Medical Devices and other supporting rules and regulatory documents in accordance with th e newly-revised Regulations, the further detailing 
of application requirements, and the specifications for work procedure. 
 Part 3 – Trade Policies and Practices by Measure 
3.1.9 Sanitary and phytosanitary requirem ents: paragraphs 3.78 and 3.79, page 77 
 It is noted that "According to the authorities, ther e have been no changes in any of the procedures 
to establish SPS requirements in China since 2010". However, we also note that China had a 
leadership change in spring of 2013. 
 
1.  Could China please confirm whether or not there has been any change in the structure and 
functional relationship between the Ministry of Agriculture (MoA) and the General 
Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) in their respective roles and responsibilities regardin g entry and exit for animal and plant health 
quarantine purposes? 
 Answer 
There is no change in the structure and function al relationship between the MOA and the AQSIQ in 
their respective roles and responsibilities regardin g entry and exit for animal and plant quarantine 
purposes.  
Part 3 – Trade Policies and Practices by Measure 
3.1.9 Sanitary and phytosanitary requ irements: Paragraph 3.84, Page 78 
 
No reference document is cited for Members to  verify what the "testing methods for food 
additives" China is currently using are or that  China may consider adopting in the future. 。 
 
1.  Does such a document exist that could be shar ed with Members? If not, will China develop 
and publish such a reference document detailing the testing methods and standards for food additives required by China's Entry and Exit Inspection and Quarantine Bureaux 
(CIQ)?  
 Answer 
All food safety standards shall be issued in the form of announcements on the official website of the National Health and Family Planning Commission at: http://www.nhfpc.gov.cn/sps/s7891/list.shtml. You can inquire the testing methods and standard documents of food additives on the website of 
the National Health and Family Planning Commission and the China National Center for Food 
Safety Risk Assessment at:  http://bz.cfsa.net.cn/db. 
 WT/TPR/M/300/Add.1 
 
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 Part 3 – Trade Policies and Practices by Measure 
3.2.3 Export prohibitions, restrictions , and licensing: paragraph 3.98, page 82 
 
The report notes that China applies three types of  export licenses: export quota licences, export 
quota bidding licences and export licences.   
1.  Regarding the third type of export licences, could China explain if the licences are 
automatically rendered after all the paperwork is filed or if there is any substantive criteria to be met with?  
2.  Which are the Chinese authorities in charge of such type of export licences?  
 
Answer 
In accordance with the Measures for the Administra tion of License for the Export of Goods, when 
an export merchant applies for a general export licen se (which is the "third type of export licences" 
as mentioned in this questionnaire), it needs to submit the application form for the export license and the export contract. If it is an enterprise th at applies for obtaining the export license for the 
first time, it also needs to submit  the form for recordation and regist ration of foreign trade dealers. 
The license-issuing institution shall immediately i ssue the export license to the applicant that 
submits complete application materials. The issuing institutions of the above export license are the 
issuing authorities of the Ministry of Commerce and all local commerce departments. 
 
Part 3 – Trade Policies and Practices by Measure 3.2.6 Export finance, insurance, and guarantees: paragraph 3.111, page 85 
 
It is noted that Chinese authorities indicated that details on their export credit programmes were confidential but even though China is not a memb er of the Arrangement, in practice Eximbank 
followed the terms and conditions of the Arrangement.  
 
1.  Given that transparency through full and regular notifications is a critical component of the 
Arrangement and allows participants to the Arrangement to ensure that a level playing 
field is maintained, how/where does China fulfill the notifications and reporting 
requirements set out under the Arrangement? In providing "export buyer's credit" and "export seller's credit", what products or facilities are offered by China Eximbank?  
 
Answer 
In some credit business, China Eximbank has re ferred to the "Gentlemen's Agreement" of the 
Organization for Economic Cooperation and Development (OECD); however, China is not a 
member state of the OECD and therefore the "Gentl emen's Agreement" of the OECD is not binding 
on China. The export seller's credit of China Ex imbank includes such business varieties as vessel 
export seller's credit, equipment export seller's credit, high and new technology product export 
seller's credit, general electromechanical product export seller's credit, overseas project 
contracting loans, overseas investment loans, agricultural product export seller's credit, and 
cultural product and service export seller's credit ; and the export buyer's credit is no longer 
classified into specific business varieties. 
 Part 3 – Trade Policies and Practices by Measure 
3.3.1 Incentives: paragraph 3.119, page 87 
 It is noted that China's most recent notification to the Committee on Subsidies and Countervailing Measures dates from 2011 and covers programmes maintained at the central level during the 
period 2005-2008. Canada believes that the subsidy notification process is a fundamentally 
important transparency exercise for achieving the aims of the Agreement on Subsidies and 
Countervailing Measures.  
 
1.  In its last Trade Policy Review, China indicated that it is working towards incorporating 
sub-central subsidies in its future notifications. Could China please indicate when it plans 
to provide its next notification to the Committee and clarify whether sub-central 
programmes will be included?  
 WT/TPR/M/300/Add.1 
 
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 Part 3 – Trade Policies and Practices by Measure 
3.3.1 Incentives: paragraph 3.122, page 88  
It is noted that specific industries such as  emerging industries, high and new technology 
industries, industries that promote energy conser vation and environmental protection, industries 
related to public welfare and public infrastructure, which would not otherwise attract capital, are 
supported by the State. The objective of thes e support programmes is to promote innovation, 
upgrade industries, and protect the en vironment and green development.  
 
1.  Can China elaborate on how these types of indu stries are supported by the state? Do they 
receive direct financial support? Are they provided with preferential market conditions?  
 Answer 
For the relevant support measures, see programmes 10, 19, and 20 of G/SCM/N/155/CHN and G/SCM/N/186/CHN in the Notification on China's Subsidies.  
Part 3 – Trade Policies and Practices by Measure 
3.3.1 Incentives: paragraph 3.126, page 88  The Secretariat report indicates that in addition to  the programmes notified by China, there appear 
to be other support programmes and other means to support different industries (e.g. fisheries) 
through the provision of grants, policy lending by  state-owned banks and the supply of goods at 
lower than "market price" by state-owned enterp rises (SOEs). However, in the context of this 
Review, no information was provided to the Secretariat regarding these specific programmes or 
China's industrial policies that support ed different areas of the economy.  
 
1.  Could China provide the list of specific programmes or China's industrial policies that 
support key industrial sectors and explain whether there are plans to increase the transparency of internal administrative measures and the central budget?  
 
Answer 
The Chinese government guides the industry deve lopment directions in the form of a guiding 
catalogue and the catalogue for guiding industry rest ructuring is an important part of the national 
industrial policies. At present, it is the Catalogu e for Guiding Industry Restructuring issued in 2013 
that is in progress. China has been steadily pr omoting various reforms and constantly improving 
the transparency of central budgets. 
 
1.  Could China indicate whether foreign-invested enterprises (FIEs) have access to these 
support programmes? 
 
Answer 
Regarding corresponding policies, domestic and FIEs are treated without discrimination and 
qualified FIEs may enjoy equivalent policy support. For instance, FIEs and domestic-funded 
enterprises enjoy the same enterprise income tax policy. 
 Part 3 – Trade Policies and Practices by Measure 
3.3.1 Incentives: paragraph3.131, page 91  
 Canada notes that China's state-owned enterprise s continue to be supported by the Government, 
including through the provision of direct transfers, cheap inputs and credit. Not only does this 
make it very difficult for foreign/private companies to compete, it also allows SOEs with low 
productivity to continue to exist in the market.   
China's recent Decision Concerning Some Major Issues in Comprehensively Deepening Reform  
outlined the leadership's intent to create more leaner and competitive SOEs.  
1.  Will China's reforms include a reduction in government support to SOEs, which in turn 
would provide a more level playing field for private/foreign companies to compete?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
China has been committed to creating a market environment with fair competition for various 
ownership enterprises. In the Chinese laws, various ownership enterprises are treated equally 
without discrimination. SOEs are market participants and legal entities that conduct business 
operations independently and assume sole responsibilities for their profits and losses and they do not enjoy preferential policies in the aspects of credit, taxation, and supervision. Therefore, there 
is no such issue concerning the provision of government support to SOEs. 
 Part 3 – Trade Policies and Practices by Measure 3.3.1 Incentives: paragraphs3.131-132, page 91 
 
In China's Government Report, it is noted that, "Thanks to years of reform, China's state-owned 
enterprises have integrated themselves into market economy. The steps in the next phase of 
reform will include optimizing the distribution and structure of state-owned economy and ensuring 
the state-owned capital increases its input into pu blic-welfare enterprises" (paragraph 2.43).  
 
In the Secretariat's Report, it is noted that China seems to support state-owned enterprises 
(SOEs) in different ways, including through the provision of direct transfers to finance wages and operating costs, and cheap inputs and credit. This support allows SOEs with low productivity to continue to exist, affecting competitiveness.  
 
1.  Could China please explain how such support is consistent with SOE integration into a 
market economy? 
 
Answer 
According to the Decision for deepening the reform of SOEs, China shall attach importance to two 
key links. One link is to accelerate the reform in th e diversity of equities of SOEs, actively develop 
the mixed ownership economy, particular efforts shall be made to accelerate the reform of the corporate system and shareholding system of parent companies, and further optimize the equity structure of SOEs. Strategic investors with advantages in capital, technology, and management  
and such institutional investors as social security  funds, insurance funds, and equity investment 
funds are encouraged to participate in the restru cturing and reorganization of SOEs. The second 
link is to deepen the management system reform for SOEs and improve the modern corporate 
system. 
 
1.  Could China explain whether removing government support to SOEs will form part of the 
next phase of its reform? Are there plans to privatize SOEs in specific sectors?  
 Answer 
For industries of natural monopoly in which the state-owned capital continues to operate by 
controlling shares, reforms with such key content as separation of politics from enterprises, 
separation of politics from capital, franchising, and government regulation shall be implemented. 
China will accelerate the development of mixed ow nership economy, promote the reform of equity 
diversity of SOEs, and establish a cooperative mechanism of governments and social capitals. 
Except that a few enterprises and investment comp anies that involve national security may adopt 
the form of state-owned monopoly, the state-owned capital shall participate in business operations 
in the form of shareholding or joint stock in other industries and fields. China will accelerate the 
review of laws, regulations, rules, and regulatory  documents that restrict the development of the 
non-public sector, promote the participation and entry of non-state-owned capital in investment in central enterprises and into the franchising fields , and liberalizing all competitive fields including 
the competitive business of industries of natural monopoly so as to provide a stage for private 
capital to take the spotlight.  WT/TPR/M/300/Add.1 
 
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 Part 3 – Trade Policies and Practices by Measure 
3.3.1 Incentives: paragraph 3.132, page 91  
It is noted that the Chinese Government also provides industry-specific subsidies for inputs, land 
and technology to firms that the central and pr ovincial governments perceive as strategically 
important. They are also given cheap access to credit.  
 
1.  Given the announcement after the Third Plenum that the market would play a decisive role 
in the allocation of resources, are there plans to adjust how these subsidies are administered?  
 
Answer 
In order to implement the Decision, the central government has improved the support manners, 
adopted more market-oriented means, and given play  to the decisive role of the market in the 
allocation of resources. Government subsidies w ill be used in the fields of livelihood projects, 
infrastructure, and environment control in a centralized manner. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.2.6 Price Controls: paragraph 3.165, page 99  
It is noted that China applies price controls to commodities and services deemed to have a direct 
impact on the national economy and people's livelihoods.  
1.  Could China please elaborate more specifically  on how commodities and services subject to 
price controls are determined?  
2.  Could China please indicate what steps, if any, are being taken to reduce the influence of 
the central government in setting prices?  
 
Answer to questions 1 and 2 
In accordance with China's commitments at the entry into the WTO, only a few commodities and services (see Annex 4 to the Protocol) adopt government-fixed pricing and governed-guiding 
pricing in China and the prices of a majority of commodities and services are entirely formed by 
the market. In accordance with the provisions of the Price Law of the People's Republic of China, 
for prices of the following commodities and services, governments may implement government-
guiding pricing and government-setting pricing when necessary: (1) a few commodities that have 
a significant influence on the national economic  development and people's livelihood; (2) a few  
commodities of resource scarcity; (3) commodities subject to natural monopoly; (4) crucial public 
utilities; and (5) important public services. 
 Part 3 – Trade Policies and Practices by Measure 3.3.3 State trading, state-owned enterprise s, and privatization: paragraph 3.173 and 
Table 3.16, page 102 
 The Secretariat report notes that in principle, goods subject to state trading can be imported only 
by authorized enterprises, while crude oil and prod ucts subject to tariff-rate quotas may also be 
imported by non-state trading enterprises. However, quantities imported under state trading are not available.  
 
1.  Looking at Table 3.16, could China provide further details as to the policy objectives that 
are being supported by the varying levels of tariff-quota shares allocated between state 
trading and non-state-trading entities?  
 
Answer 
According to China's commitments made at the entry into the WTO, the imports of grains, cotton, 
sugar, crude oil, processed oil, and certain fertilizer  in China are subject to state trading and at the 
same time, the imports of a certain proportion are allowed to be conducted by non-state trading enterprises. 
 
2.  Could China provide quantities imported by state trading entities?  
 WT/TPR/M/300/Add.1 
 
- 262 - 
 
  
 Answer 
The import volume and the proportion of stat e trading are in compliance with WTO rules and 
China's access commitments. 
 
3.  Could China indicate if it intends on reforming its state-trading sector to allow for more 
participation of non-state trading entities and eventually realize import volumes consistent 
with China's market access commitments?  
 Answer 
The import volume and the proportion of stat e trading are in compliance with WTO rules and 
China's access commitments. 
 Part 3 – Trade Policies and Practices by Measure 
3.3.3 State trading, state-owned enterprise s, and privatization: paragraph 3.174, 
page103  
According to the Secretariat report, in 2013, volumes of exports subject to state trading were 
determined by taking into account international and domestic supply and demand. The state trading enterprises themselves determine the pric e of the goods that they export, according to 
China's latest State-trading notification, which dates from 2003.  
 
1.  Could China elaborate further on the guidel ines used by state trading enterprises in 
determining volumes and prices for exports of agricultural commodities?  
 
Answer 
Different from the operations of state trading en terprises of some other member states, China's 
state trading enterprises conduct market-based operations. They independently adjust or change 
the import and export volumes and the import an d export progress according to the international 
market supply and demand and price changes.  
2.  Could China indicate timelines in updating its state trading notification? 
 Answer 
The state trading regime of China, including th e products covered and the list of state-trading 
enterprises, has not seen major changes since the 2003 notification G/STR/N/9/CHN/Add.1, except that a couple of products were no longer subject to the state trading regime. Also, for a few 
products subject to state trading, some statistics required in the notification are not officially 
produced in China. In view of these, the state trading notification was not submitted. If Members 
expect China to submit the notification despite of  the few changes, China will prepare a notification 
as soon as possible. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.4 Government Procurement: paragraph 3.175, page 105 
 
The Secretariat report states that "China continues to be engaged in the process of acceding to the WTO Agreement on Government Procurement (GPA ). This may imply eventual changes to the 
legislative regime, currently in a preparatory stage, to align it with the provisions of the GPA".  
 
1.  Can China provide further details on the legislative changes required to accede to the GPA, 
and describe the steps China is taking and the anticipated timeline for these changes?  
 
Answer 
China's legislative body will consider whether to revise relevant laws and regulations or not 
according to the status of negotiations. 
 
2.  Does China intend to review its Government Procurement Law and the Tendering and 
Bidding Law in the near future? 
 WT/TPR/M/300/Add.1 
 
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 Answer 
China's legislative body will consider whether to revise relevant laws and regulations or not 
according to the status of negotiations. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.4 Government Procurement: paragraph 3.182, page 106 
 
The Secretariat report states that "that despite the 'buy-domestic' provision included in the Government Procurement Law, the Chinese Government has been implementing a policy to facilitate the procurement of foreign products since 2007".  
 
1.  Can China provide further details on this policy and explain how it facilitates the 
procurement of foreign products and which entity is responsible for implementing this 
measure?  
 
2.  Can China indicate whether this policy applies to procurement made by central and 
provincial entities 
 Answer for questions 1 and 2 
According to the Administrative Measures for Import Products Procurement by Government, as 
long as the purchaser has a demand and the sibling financial sector's approval has been acquired, 
the purchase of import products will be allowe d. The policy applies to procurement made by 
government departments of all levels. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.4 Government Procurement: paragraph 3.182, page 106 
 
The Secretariat report states that under Article 10 of the Government Procurement Law, the Government is required to procure domestic goods, construction projects and services, subject to certain exceptions.  
 
1.  Could China provide the definition used to define domestic goods and local content 
referred to in China's Government Procurement Law?  
2.  Could China provide an update on the approv al and implementation of the draft Measures 
for the Administration of Government Procurement of Domestic Products?  
 
Answer for questions 1 and 2 
The Ministry of Finance is studying and formulating measures for the administration of domestic 
goods procurement with relevant authorities, and there is no definition on domestic goods and local content for the time being. 
 
3.  Could China elaborate on the eligibility of foreign owned companies under the Government 
Procurement Law and the effect of this law, if any, on intellectual property that is foreign 
owned or jointly owned by Chinese and foreign companies?  
 Answer 
Article 22 of the Government Procurement Law lays down basic rules concerning the qualification needed for suppliers to participate in government procurement. The Law has not stipulated the specific regulations or restrictions for foreign owned suppliers, jointly owned suppliers and the intellectual properties owned by them. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.4 Government Procurement: paragraph 3.190, page 108 
 
The Secretariat report states that "Procuring entities must announce government procurement and bidding information in media designated by the Mi nistry of Finance in 'a timely and standard 
manner' to ensure transparency and fair competition".  
 WT/TPR/M/300/Add.1 
 
- 264 - 
 
  
 1.  Can China provide the standard timelines an d the media designated by the Ministry of 
Finance for the procuring entities to announce government procurement and bidding information?  
 
Answer 
According to the laws and regulations on governme nt procurement, where commodities or services 
are to be procured in the form of invitation for bid, the length of time between the date the bid 
documents are sent out and the deadline for the su bmission of tender documents by the tender 
shall be no less than 20 working days; where the form of competitive negotiation is adopted for procurement, the notice period of negotiation documents shall be no less than 3 working days; 
where the form of inquiry is adopted for procuremen t, the notice period of inquiry notice shall be 
no less than 3 working days. China Government  Procurement News and http://www.ccgp.gov.cn 
are the media that release government procuremen t information formulated by the Ministry of 
Finance. 
 Part 3 – Trade Policies and Practices by Measure 
3.3.4 Government Procurement: paragraph 3.193, page 108 
 The Secretariat Report states that "bidders, if unfairly excluded from procurement processes or treated in a discriminatory way, may complain to the procuring agency, appeal to the Government 
Procurement Division of the Ministry of Finance, or subsequently file a complaint with a court".  
 
1.  Could China provide more information on the complaint process for procurement made at 
the provincial level?  
 Answer 
The same complaint process applies to procuremen t made at both central and provincial levels. 
Chapter VI of Government Procurement Law provides detailed provisions for query and complaint.  Part 3 – Trade Policies and Practices by Measure 
3.3.4 Government Procurement: paragraph 3.198, page 109 
 The Secretariat report states that: "Members encouraged China to submit a revised [GPA] offer to 
respond to Parties' requests by lowering thresh olds, further increasing coverage of sub-central 
entities, and making improvements in other areas".   
1.  Canada would like to know what criteria China has used to determine which provinces and 
municipalities should be covered by China's GP A offer and whether a province should be in 
Group A or Group B.  
 
Answer 
The grouping is based on local level of economic and social development and will respect the 
wishes of local government. 
 
2.  Moreover, in light of General Note 6 in China's fourth revised offer, can China clarify how 
long after China's accession to the GPA would the Agreement apply to entities listed under 
Group B? Canada would also appreciate clarity on  what the "date of taking effect" refers to 
in Note 3.  
 Answer 
According to the 5th offer submitted by China in December 2013, Group B will begin to fulfill its 
obligations starting from the seventh year since China's accession.  WT/TPR/M/300/Add.1 
 
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 Part 3 – Trade Policies and Practices by Measure 
3.3.5.2.1 Patents: paragraph 3.202, p. 111  
The Secretariat Report states that "[l]ocal IPR administrative offices deal with hearing and settling 
controversies with respect to patents".  
1.  Could China clarify what type of "controversies " would be dealt with by such a local office 
as opposed to cases that would have to be heard by a People's Court?  
 Answer 
In trademark disputes, the right holder may choose either to file complaint to local industrial and commercial bureaus, or to bring a suit to people's  court. According to Article 60 of Patent Law, 
local intellectual property offices are entitled to handle patent infringement disputes; local 
intellectual property offices are also entitled to me diate at the request of interested parties for the 
amount of patent infringement indemnity. According to Article 63 of Patent Law, local intellectual property offices are entitled to investigate and treat alleged patent counterfeiting. Besides, local 
intellectual property offices are entitles to mediate in various patent controversy cases such as 
disputes on patent application right and patent right ownership and on rewards for inventors and designers of service invention-creation. During th e afore-mentioned controversies, the interested 
parties can also directly bring suit to people's court. The interested parties have the full right to 
decide how to handle the controversies. 
 Part 3 – Trade Policies and Practices by Measure 
3.3.5.2.1 Patents: paragraph 3.207, page 112 
 The Secretariat Report notes that patent applications for a foreign or international patent with 
substantial content generated within the Chinese territory are subject to a preliminary national-
interest clearance and a confidentiality examination prior to filing.   
1.  Could China indicate how often preliminary national-interest clearances and confidentiality 
examinations have been applied in the past 3 years?  
 
Answer 
According to Article 20 of Patent Law, any unit or individual that intends to apply for patent in a foreign country for an invention or utility model accomplished in China shall submit the matter to the patent administration department under the State Council for confidentiality examination. 
Therefore, each and every invention or utility mo del accomplished in China during the past three 
years should pass the confidentiality examination of  the State Intellectual Property Office before 
filing an application in a foreign country for a patent.  
Part 3 – Trade Policies and Practices by Measure 
3.3.5.2.1 Patents: paragraph 3.208, page 112  
The Secretariat Report notes noted that China's patent law provides for compulsory licensing of 
patents if the patent-holder is found to restrict competition through the abuse of their patent right, or if the compulsory license is in the public interest.  
 
1.  Could China provide details on any cases where a compulsory license was ordered or used 
in the case of an abuse of intellectual property rights?  
 
Answer 
According to Article 48 of the Patent Law, when th e patentee's exercise of the patent right is in 
accordance with law, confirmed as monopoly and its negative impact on competition needs to be 
eliminated or reduced, the patent administration department under the State Council may, upon 
application made by any unit or individual that possesses the conditions for exploitation, grant a compulsory license for exploitation of an invention patent or utility model patent. According to 
Article 49 of Patent Law, where a national emergency or any extraordinary state of affairs occurs, 
or public interests so require, the patent admi nistration department under the State Council may 
grant a compulsory license for exploitation of an invention patent or utility model patent.  WT/TPR/M/300/Add.1 
 
- 266 - 
 
  
 2.  Could China clarify the process in which compulsory licenses are granted in the public 
interest? Specifically, how is it determined that a compulsory license is in the public interest? How many compulsory licenses have been granted in the past 3 years on the 
basis of public interest?  
 Answer 
The Measures Regarding Implementation of Compulsory Patent Licensing (department regulations of the State Intellectual Property Office, in force since 1 May 2012) specifies the detailed process in which compulsory licenses are granted. During  the past three years, China has granted no 
compulsory licenses to any patent. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.5 Intellectual Property: paragraph 3.217, page 114 
 
The Report notes that if the Trademark Office "refuses to register a trademark, the applicant may appeal the decision before the Trademark Review and Adjudication Board". However, we 
understand that the amended Trademark Law no longer provides opponents with the analogous 
opportunity to apply to the Trademark Review and Adjudication Board for review.  
1.  Could China clarify the rationale for this change? 
 
Answer 
Before the amendment, the Trademark Law adopted a four-hearing system for opponents (two 
administrative hearings and two judicial hearin gs), which led to burdensome trademark right 
confirming process and excessively long cycle of trademark right confirming process. Some illegal 
operators prevent competitors from getting trademark registration in time through malicious objections, resulting in the long-term instability of trademark right. The amendment has 
restructured the objection framework. If the trademark office considers the argument of objection 
fail, the trademark will acquire registration directly, and this reduces the time needed for trademark right confirming and damps malicious objections. If the opponent is not satisfied, he can apply to the trademark review and adjudication board for an announcement of invalid 
registration. 
 Part 3 – Trade Policies and Practices by Measure 
3.3.5.2.2 Trademarks: paragraph 3.215, p. 114 
 The Report notes the entry into force, on 1 Ma y 2014, of the third amendment to the Trademark 
Law, including the introduction, in Article 7, of "good faith" as a principle underpinning applications 
for and use of trademarks; we welcome these revi sions to the Trademark Law. We note, however, 
that the amended Trademark Law does not include lack  of good faith (or, otherwise, bad faith) as 
grounds for opposition under Article 33.  
 
1.  Could China clarify whether it intends to apply good faith as a general principle throughout 
the amended Trademark Law, including to oppositions, or whether the omission is rather 
intended to explicitly exclude bad faith on behalf of the applicant as grounds for 
opposition?  
 
Answer 
In the amended Trademark Law, good faith is introduced into Article 7 as a general principle. The 
good faith principle here covers the whole process of trademark registration, and the legislative spirit is embodied in Article 13, 15, and 32. But du ring a trial, the principle alone shall not be used 
as the ground for ruling so as to avoid abuse of the good faith principle. 
 Part 3 – Trade Policies and Practices by Measure 
3.3.5.2.2 Trademarks: paragraph 3.219, p. 115 
 The Secretariat Report notes the conditions under which the Trademark Office can revoke a 
trademark for lack of use. In this respect, we note the new Article 48 of the Trademark Law – 
while at first glance only addressing the definition of "use" – appears to divide observers as to whether it creates a safe harbour for original equipment manufacturers (or OEMs) or, on the contrary, does not.  WT/TPR/M/300/Add.1 
 
- 267 - 
 
  
 1.  Could China clarify the intent of the new Article 48 of the Trademark Law?  
 Answer 
In China, one can get the exclusive right to use a trademark only if he has registered the trademark. But the value of a trademark comes from usage, and registered trademarks have the obligation to be used. The new Article 48 of Tradem ark Law intends to clarify the definition of and 
attract attention to trademark usage. 
 Part 3 – Trade Policies and Practices by Measure 3.3.5.2.2 Trademarks: paragraph 3.220, page 115 
 
The Secretariat Report notes that the SAIC Decr ee 2010/49 requires the operator of an Internet 
trading platform to take necessary action against trademark infringement, is responsible for 
disciplining users of the platform, and is liable for damage caused by misuse of the platform.  
 
1.  Could China clarify the requirement and liability for trademark infringement under this 
decree for the website owner? Website administrator? Online payment service provider 
(such as Visa or Paypal)?  
 Answer 
Please refer to Article 24 of the Interim Measur es for the Administration of Commodity Trading 
through Internet and Related Services for more details.  
Part 3 – Trade Policies and Practices by Measure 
3.3.5.2.2 Trademarks: paragraph 3.221, page 115  
The Secretariat Report notes China currently has no explicit rules on parallel imports for 
trademarks or copyright.  
1.  Could China clarify how parallel imports are dealt with? Are they restricted or non-
restricted? Are they considered infringement? Are there any non-explicit rules that govern 
parallel imports?   
Answer 
China's patent law allows parallel imports of patent. Trademark law and copyright law provide no 
rules concerning parallel imports of trademark or copyright. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.5.3Copyright and Related Rights: paragraph 3.226, page 116  
The Secretariat Report notes that copyright registra tion and enforcement is carried out at both the 
central and provincial levels.   
1.  Could China indicate whether the fact registration and enforcement is carried at both the 
central and provincial levels results in differe nt approaches to copyright registration and 
enforcement? Also, can China outline how they ensure consistency in the approaches on all 
levels?  
 Answer 
As to copyright registration, according to the Trial Measures on Voluntary Registration of Works, 
National Copyright Administration and copyrigh t administration authorities of provinces, 
autonomous regions and municipalities directly under the central government are the entities responsible for the registration. In 2011, National Copyright Administration issued Notification on 
Further Standardizing the Registration Process of Works which lays down detailed rules concerning 
application accepting, review, time limit, certificate content, registration form format, and data collection of work registration. Meanwhile, the administration has established the National 
Database for the Registration of Works to collect registration data in time and publish relevant 
data for inquiry. Currently, the national registration of works has made progress in terms of normalization, standardization and informationization.   WT/TPR/M/300/Add.1 
 
- 268 - 
 
  
 As to copyright enforcement, local copyright ad ministrative law-enforcement agencies penalize 
infringers according to Article 36 of the Implemen ting Regulations of the Copyright Law of PRC, 
and the standards of penalties are unified nationwide. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.5.3 Copyright and Related Ri ghts: paragraph 3.229, page 116 
 
The Secretariat Report notes that copyright protection can be vested automatically in works, whether published or not, including "oral works" and "acrobatic works."   
1.  Could China clarify whether any form of fixati on is required for a work to benefit from 
copyright, especially in the case of oral works or acrobatic works?  
 
Answer 
The current copyright law requires no fixation form of a work, which also applied to oral works or 
acrobatic works. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.5.3 Copyright and Related Ri ghts: paragraph 3.230, page 116 
 
The Secretariat Report notes that copyright includes rights such as "broadcasting" and 
"communication through information networks."   
1.  Could China clarify what constitutes "broadcasting": does it only include cable and satellite 
networks or does it include other media?  
 
Answer 
According to the current copyright law, the right of  broadcast is the right to publicly broadcast or 
communicate to the public a work by wireless me ans, to communicate to the public a broadcast 
work by wire or relay means, and to communicate to the public a broadcast work by a loudspeaker 
or by any other analogous tool used to transmit symbols, sounds or pictures. 
 
2.  Could China clarify what is considered "communication through information networks": 
does this just include the Internet or does it include other media?  
 Answer 
According to the current Copyright Law, the right of communication of information on networks is 
the right to communicate to the public a work, by wire or wireless means in such a way that members of the public may access these works from a place and at a time individually chosen by them. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.5.3Copyright and Related Rights: paragraph 3.233, page 117 
 
The Secretariat Report notes that in 2013 the State Council amended the amount of administrative fines. 
 
1.  Under what circumstances are administrative fines available?  
 Answer 
Article 48 of the current Copyright Law, Article 24  of Regulations for the Protection of Computer 
Software, Article 36 of the Implementing Regulati ons for the Copyright Law, and Article 18 and 19 
lay down explicit rules concerning administrative fines. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.5.3Copyright and Related Rights: paragraph 3.234, page 117 
 
The Secretariat Report notes that broadcasting or ganizations must pay remuneration to copyright 
owners for broadcasting musical works. The method s and amounts of the payments are outlined in 
agreements with copyright collectives.  WT/TPR/M/300/Add.1 
 
- 269 - 
 
  
 1.  Could China clarify whether these payments cover simulcasting, such as broadcasting on 
traditional media as well as the internet?  
 
Answer 
According to Article 43 of the Copyright Law, stat utory license is only needed when a radio station 
or a television station broadcasts a published work; therefore, these payments do not cover 
simulcasting. 
 
2.  What is considered a broadcasting organization?  
 
Answer 
In China, a broadcasting organization refers to a radio station or a television station, not a internet 
broadcaster.  
 
3.  If there is no agreement between broadcas ting organizations and copyright collectives, 
how would the method and amount of the payment be determined?  
 
Answer 
The method and amount of the payment are dete rmined according to Article 8 of the Interim 
Measures on the Payment by Radio and Television  Stations for Broadcasting Sound Recordings. 
 
Part 3 – Trade Policies and Practices by Measure 3.3.5.4.3Undisclosed Information and Trad e Secrets: paragraph 3.242, page 118 
 
The Secretariat Report notes that the People's Court exercise their judicial power to try civil and criminal trade secret cases.  
 
1.  Could China provide a breakdown of the number of civil and criminal trade secret cases 
annually, including the level of court that these cases take place?  
 
Answer 
In 2011, the numbers of civil and criminal trade se cret cases accepted and heard by local people's 
courts are 247 and 50 respectively; in 2012, the numbers are 246 and 51 respectively, in 2013, 
the numbers are 241 and 47 respectively. 
 
2.  Could China confirm whether trade secrets are part of its unfair competition laws? If so, 
what other provisions related to IP are found in the unfair competition laws?  
 Answer 
China's unfair competition laws have specified the connotation of trade secrets and the situations 
considered as infringing upon trade secrets. Criminal law, contract law, labor contract law, 
company law, related judicial interpretations, and department rules and regulations have laid down 
rules concerning trade secret protection from different perspectives. The current unfair competition 
laws contain no regulations on IP except for that on trade secrets. 
 Part 3 – Trade Policies and Practices by Measure 
3.3.5.5.2.2Copyright Admini strative Law Enforcement: paragraph 3.251, page 120 
 The Secretariat Report noted that China has initiated a crackdown on online infringement, during which 72 cases were transferred to the judicial authority for investigation of criminal responsibility, 
and that China has strengthened the voluntary monitoring of video websites.  
 
1.  Could China provide an update on the status of these 72 cases, and what, if any, penalties 
have been issued for these cases?  
 Answer 
Copyright administrative authorities have handed  the 72 criminal cases over to the judicial 
departments which will determine what penalties should be issued.   
2.  Could China clarify and provide examples of what is involved with "voluntary monitoring"?  WT/TPR/M/300/Add.1 
 
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 Answer 
Voluntary monitoring, or proactive supervision,  was launched in September 2010 by National 
Copyright Administration to ensure the legal oper ation of video websites and maintain a healthy 
and orderly internet video market. Since 2010, National Copyright Administration has brought 
more than 20 major video websites in China (such as Sina, Sohu, and Youku) into the framework of proactive supervision and conducted technological and copyright analysis for their broadcasting 
of film and television works. Three years of proactive copyright supervision has enlarged the 
proportion of authorized contents and purified the copyright environment for the internet video 
industry.   
Part 3 – Trade Policies and Practices by Measure 
3.3.5.5.3 Judicial Enforcement:  paragraph 3.254, page 121 
 
The Secretariat Report notes that there are several levels to China's judicial infrastructure.  
1.  Could China clarify the remedies available for IP infringement in each level of court?  
 
Answer 
When hearing IP infringement cases, courts of all levels could provide remedies (such as pre-suit 
injunction, injunction during suit, pre-suit pr operty attachment, property attachment during 
lawsuit, and pre-lawsuit perpetuating testimony) according to Civil Procedure Law and laws and 
regulations on trademark, copyright, and patent. When the infringement is confirmed, people's 
courts should adopt remedies such as injunction and indemnity according to laws, regulations, and 
judicial interpretations on trademark, co pyright, patent, and unfair competition.  
 
Part 3 – Trade Policies and Practices by Measure 3.3.5.5.3 Judicial Enforcement:  paragraph 3.254, page 121 
 
The Secretariat report states that during the period under review, China reinforced the judicial infrastructure needed for court enforcement of IPRs.   
1.  What progress has been made in the establishment of specialized Intellectual Property 
courts?  
 
Answer 
On June 2008, the Outline of National Intellectu al Property Strategy suggested to explore and 
establish IP appeals courts. In 2013, the Decision on Some Major Issues Concerning 
Comprehensively Deepening the Reform suggested to explore and establish IP courts and 
considered this as a significant national strate gy. The Supreme People's Court, together with 
relevant departments of the central government, is actively yet prudently carrying out the work of 
establishing IP courts. In 2014, the 3rd meeting of the leading group for comprehensively 
deepening reform passed the Programme on Establishing Intellectual Property Courts. The details 
of establishing IP courts are yet to be formed.  
Part 3 – Trade Policies and Practices by Measure 
3.3.5.5.3.1 Customs Law Enforcem ent: paragraph 3.259, page 122 
 
The Secretariat Report states that "[i]n accordance with the Regulations on Customs Protection of 
Intellectual Property, counterfeit goods will be se ized by Customs, and Customs shall destroy the 
goods if the infringing features cannot be removed", and adds that "except in extraordinary circumstances, the imported goods bearing counter feit trademarks shall not be allowed to enter 
into the channel of commerce simply by remo ving the trademark logo from the goods".  
 
1.  Can China please elaborate on the nature and scope of that authority and provide 
information on initiatives or "special campaigns"  targeted at pirated and counterfeit goods?  WT/TPR/M/300/Add.1 
 
- 271 - 
 
  
 Answer 
The Chinese Customs protects, in accordance with the Regulations on Customs Protection of 
Intellectual Property, trademark rights, copyright and related rights, and patent rights that are 
related to import and export of commodities and are protected by Chinese laws and administrative 
regulations. Owners of intellectual property wh o request Customs to protect their intellectual 
property shall file applications with Customs for protective measures. Intellectual property owners 
may file their intellectual property with the Genera l Administration of Customs in accordance with 
the Regulations on Customs Protection of Intelle ctual Property, and Customs will take protective 
measures for the filed intellectual property in lin e with their mandate and in accordance with the 
laws. 
 
In 2013, the Chinese Customs, the U.S. Customs and the border protection administration jointly conducted a "joint law enforcement action to crac k down on counterfeit consumer electronics" for 
one month, which mainly targeted at USB cables, lamps, batteries, cell phones, spare and ancillary 
parts, ear phones, and other consumer electronics that are exported to the U.S.. During the action, the two Customs had seized 243, 000 pieces of counterfeit consumer electronics, and the 
police of the two countries trapped numerous susp ected criminals according to the clues provided 
by Customs.  Part 4 – Trade Policies by Sector 
4.1.3.1.1 Measures affecting im port: paragraph 4.13, page 127: 
 According to the authorities, the tariff quota al location process has not changed since 2012. The 
NDRC allocates TRQs for grains and cotton and MOFCOM allocates the rest. Some products subject 
to TRQs (i.e. grain, cotton, sugar, and chemical fe rtilizers) are also subject to state trading. In 
these cases, part of the quota is allocated to st ate-trading enterprises and another part to private 
enterprises. The most recent information availabl e for tariff quota utilization dates from 2011 when 
with the exception of sugar, wool and cotton, the utilization of other TRQs was low.   
1.  Could China please elaborate upon how quotas are allocated to state trading enterprises 
and private enterprises? Are utilization rates by importers used as criteria for allocation of 
quota the following year? Can China elaborate on the reasons for the low utilization rates of quotas?  
 
Answer 
China implements tariff quotas on import of agricultural products in accordance with the Interim 
Measures for the Administration of Import Tariff Quotas on Agricultural Products (Order of the 
MOFCOM and the NDRC [2003] No. 4). With respect to the principle of allocation of import tariff quotas on grain and cotton in 2014, refer to the No. 39 Announcement jointly released by the NDRC and the MOFCOM in 2013, which ca n be found on http://www.ndrc.gov.cn. 
 
For eligible state trading enterprises and private enterprises applying for import quotas, China will allocate quotas based on the quantity of quotas they are applying for, their historical import 
performance and production capability, and other related commercial standards. Utilization rates of 
quotas by importers are an important reference for the allocation of quotas in the following year.  
After tariff quotas on agricultural products are granted to enterprises, enterprises can import 
products at their discretion in light of the market conditions, with which the Chinese government does not intervene. The utilization rates of import tariff quotas on cotton in China are 100%. China has basically managed to supply foods to meet it s demand, and has been increasing production 
and so has sufficient supply in the recent ten years. 
 Part 4 – Trade Policies by Sector  
4.1.3.1.1 Measures affecting import: Table 4.3, page 127 
 Table 4.3 in the Secretariat's report indicates that China's tariff-rate quota (TRQ) fill rate for wheat 
has been low in 2011 and 2012. Canada notes that since 2003, China's wheat TRQ fill averaged a 
20% fill rate and in the 2010-2012 period, the fill rate averaged 21%. China's Schedule CLII Section 1 B- Tariff Quotas indicates that a State Trading Enterprise (STE) is allocated 90% of the TRQ volume. In addition, China's Schedule CLII Section 1 B- Tariff Quotas Note 1 indicates that in WT/TPR/M/300/Add.1 
 
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 any year, if the quantity of the tariff-quota alloca ted to the STE is not contracted by 15 August, 
quota holders will have the right to trade or import  through any entity with the right to trade any 
product under Section 5 of China's Protocol of Accession.  
 
1.  Could China provide data on the volume of wheat imports under TRQ that was imported by 
a STE in the last three years? 
 
Answer 
Both the volume of imports and the proportion of state trading are implemented according to 
China's WTO commitments.  
 
2.  Given its low wheat TRQ fill, can China outline any reforms it plans to undertake to ensure 
that wheat imports under TRQ are based on market conditions?  
 
Answer 
The fundamental consideration for China to maintain wheat TRQ is to conform to China' WTO 
commitments. China has no plan to make revisions at present. After tariff quotas on agricultural 
products are granted to enterprises, enterprises can import products at their discretion in light of the market conditions, with which the Chinese government does not intervene. China has basically managed to supply foods to meet its demand, and has been increasing production and so has 
sufficient supply in the recent ten years. 
 Part 4 – Trade Policies by Sector  
4.1.3.2.1 Support Measures: paragraph 4.22, page 129 
 The Secretariat report states that China has made no notifications to the WTO Agriculture 
Committee regarding the support given to the agriculture sector during the period under review. 
China's most recent notification regarding domestic support covers the period 2005-2008.   
1.  Could China provide information on potential timelines for updating its domestic support 
notification?  
 Answer 
China is now preparing its domestic support notification of the agricultural sector of 2009 -2010. It will take some time to finish since there are numerous data and information that need multiple departments to collaborate, which is a complicated process. China will speed up the process and 
promptly submit the same to the WTO upon accomplishment. 
 Part 4 – Trade Policies by Sector  4.1.3.2.2 Price controls and mark eting: paragraph 4.28, page 131 
 
The price of some commodities remains controlled and others are still considered "important reserve materials" and originally subject to price controls. The agricultural products considered key 
reserve materials are grain, cotton, edible vegetabl e oil (materials), sugar, silkworm cocoons, and 
chemical fertilizers. However, according to the authorities, their price has been liberalized and the Catalogue of Reserve Materials is being revised.  
 
1.  Could China please elaborate upon how the price of these products was liberalized? Were 
import restrictions applied to implement the price controls also liberalized? Did the allocation of TRQs change as a result of this liberalization?  
 
Answer 
The products and services subject to government pr icing and guiding prices are within the scope of 
China's WTO commitments. Upon its accession to WTO, China proactively liberalized the prices of 
some products. Reserve control is a measure of market control. The Chinese government does not implement price control on reserve materials. In  general, the prices of reserve materials are 
dependent on the market and will be adjusted au tomatically by the market mechanism. Reserve 
control will only be implemented to guide the market and the prices when the market prices largely fluctuate and it is necessitated to stable the market. TRQs are allocated to related enterprises in strict accordance with China's WTO commitments, which has not changed. WT/TPR/M/300/Add.1 
 
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 Part 4 – Trade Policies by Sector  
4.1.3.2.2 Price Controls and Mark eting, paragraph 4.29, page 131 
 
According to the Secretariat report, China has gradually liberalized most agricultural markets but 
the Government still intervenes when deemed necessary. Some controls remain in the place regarding the marketing of grains and tobacco. According to the authorities, at present the 
Government only intervenes in the tobacco market.  
 
1.  Could China provide additional information regarding the conditions under which a 
government intervention in an agricultural market would be deemed necessary, and 
describe those government interventions?  
 
Answer 
The Government intervenes when food security is threated by the sharp fluctuation in international 
markets. The government is reforming our domestic support system. One of the reform 
programmes is to implement "target price" mechanism on a trial basis, letting the market play the 
decisive role in maintaining a healthy growth of the agricultural sector.  
2.  Can China describe all the controls that are still in place regarding the marketing of grains?  
 
Answer 
China is a country with large population. The demand of food is rising together with people's 
earning. For a very long time in the future, the food demand and supply with maintain a tight 
balance in China. Since 2004, the purchase and sale of grains are liberalized, free from the government's intervention. All legal entities can be engaged in grains trade. At the same time, 
when prices drop sharply and the farmers' interests are jeopardized, the government will 
implement minimum price mechanism to maintain the stability of the market, in bid to safeguard the livelihood of small farmers.  
3.  Can China elaborate on the ways it continues to intervene in the tobacco market? Does 
China have a plan to liberalize the tobacco market?  
 
Answer 
The import and export of tobacco is administrated in an exclusive manner, with no plan of 
liberalizing the market for the time being.  
 
Part 4 – Trade Policies by Sector  4.1.3.2.2.1, Other Measures, page 132  
The Secretariat report states that in 2007 China introduced the subsidized agricultural insurance 
scheme. Under this programme, insurance premiu ms are subsidized by the central and local 
governments so that farmers pay only a balance of 20-30% of the premium. This programme has 
grown in importance in recent years an d entails growing budgetary transfers.  
 
1.  Could China say if it has plans to reform the agricultural insurance scheme so as to allow 
for more participation from farmers?  
 Answer 
Currently, the insurance scheme in China covers most of the major agricultural commodities. 
Farmers usually pay a balance of 20-30% of the pr emium. Over the recent years, more and more 
farmers participate in the scheme and more produc ts are covered. The losses caused by disasters 
are reduced by the scheme, promoting the stable  and sustainable development of agriculture. 
However, the insurance scheme is yet to be improved by attracting more farmers and expanding 
coverage, such as including aquaculture goods. The government is dedicated to optimize the 
scheme through constant improvement. 
 WT/TPR/M/300/Add.1 
 
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 Part 4 – Trade Policies by Sector  
4.2.1 Telecommunication Servic es: paragraph 4.37, page 133 
 
Canada understands that in December 2013 the Mini stry of Industry and Information Technology 
(MIIT) announced a policy to allow "virtual carriers" to resell services using the infrastructure of the country's three dominant telecommunications providers.  
 
1.  Have any new "virtual carriers" begun operations since the policy was announced?  
 Answer 
19 companies have been allowed to resell their mo bile services since the policy was announced. 
 
2.  Is the reselling of telecommunications services open to foreign companies?  
 
Answer 
The reselling of telecommunications services is a new business in the Chinese market, for which 
there is no sound market regulation. The purpose of initiating the pilot programme in China is to 
explore the relevant access and regulatory policies required for treating the said business as a form of independent business. When the conditions  permit, China will open the business to other 
domestic companies and foreign companies not included in the pilot programme in accordance 
with relevant laws and regulations. 
Part 4 – Trade Policies by Sector  4.2.3.1 Architectural services : paragraph 4.85, page 144 
 
The architectural market in China is undoubtedly one of the largest and most promising in terms of future growth. Numerous foreign architectural firms are present in China, notably in the form of 
wholly foreign-owned firms. However, individual foreign architects, who are also present in large 
numbers, can only work as consultants and, in the absence of mutual recognition agreements, may not currently become Chinese-registered architects nor sit the examination to become so.  Canada also notes that foreign architectural firms are required to partner with domestic design 
institutes in order to be eligible to submit public tender documents and have their designs 
validated.   
1.  Could China provide further information on the requirement for foreign architectural firm to 
partner with domestic design institutes and which regulations state this obligation  
Answer 
The Interim Rules on the Administration of Foreign Enterprises Engaging in Architectural Designing 
within the Territory of China explicitly prescribes the requirements for foreign architectural firms to 
partner with domestic design institutes. 
 
2.  As China is currently exploring ways to open its services sector, does China anticipate 
revoking this requirement to allow foreign architecture firm to fully participate on their own 
in the Chinese market?  
 
Answer 
Foreign architectural firms should partner with Chinese professional institutes in providing cross-border services, which is a requirement explicitly made in China's WTO commitments. With respect to the requirement of providing architectural de sign services through business presence, foreign 
companies may establish a WFOE in China. China will decide to further open the sector in light of 
its domestic market development. 
 WT/TPR/M/300/Add.1 
 
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 Part 4 – Trade Policies by Sector  
4.2.3.2 Construction: Box 4.9, page 150  
In the section on "Specific standards on foreign personnel, equipment and material", it is noted 
that foreigners employed by a foreign-invested cons truction enterprise shall reside in China for at 
least three months cumulatively in one year.  
 
1.  Could China provide more information on any other regulations that relate specifically to 
the entry and stay of foreign service suppliers in the construction services industry?  
 
Answer 
Foreign service suppliers shall provide construction services in China in accordance with the Rules 
on the Administration of Foreign-invested Architectural Enterprises and the Implementing 
Measures for the Qualifications Administration und er the Rules on the Administration of Foreign-
invested Architectural Enterprises. Besides, th ey need to go through entry, exit and stay 
procedures in accordance with the Law of the People's Republic of China on Entry and Exit 
Administration, the Regulations of the People's Re public of China on the Administration of Entry 
and Exit of Foreigners and other related laws and regulations.  Part 4 – Trade Policies by Sector  
4.2.4.1.1 Applied Regimes: paragraph 4.101, page 152 
 Canada notes that China has maintained a law which stipulates foreign teachers shall possess a 
bachelor's degree or above and at least two years' experience in the field of education and 
teaching.   
1.  Can China please explain what the domestic requirements are for Chinese graduates 
looking to enter the teaching profession?  
 Answer 
Please refer to Chapter III of the Law of the People 's Republic of China on Teachers for stipulations 
on qualification and employment of teachers.  
2.  Can China please explain why two years' experience is required on top of a bachelor's 
degree, particularly as this is not always a requirement in other countries?  
 
Answer 
Two years' experience being required on top of a bachelor's degree is the condition specified in 
China's commitments when accessing to WTO (for details please refer to the Chinese WTO commitments for educational services).  
 
Part 4 – Trade Policies by Sector  4.2.5.3 Rail Transport: paragraph 4.128, page 158 
 
It is mentioned that the railway reform is ba sed on the principle of the separation between 
regulation and operation. 
 
1.  Are there any plans to separate network operations – rail line signals, track operation, 
scheduling, etc. – from the business of specific  train operations (selling seats, customer 
service, train locomotive engineer/operators, etc.)?  
 
Answer 
China will study separation between network operatio ns and business of specific train operations in 
accordance with industrial features du during th e process of further deepening reform of railway. 
 WT/TPR/M/300/Add.1 
 
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 Part 4 – Trade Policies by Sector  
4.2.5.3 – Rail Transport: paragraph 4.130, page 158  
The newly established China Railway Corporation and its duties are described.  
 
1.  For the new China Railway Corporation, ha s there been any formal reporting of the 
corporate results envisioned? In particular:  
i) Financial performance;  ii Separate key performance indicators for passenger, freight and construction  operations.  
 
Answer 
It's difficult to predict the business performance for the time being. 
 
2.  Will the new corporation allow for public tenders and Answers by independent foreign 
operators and suppliers 
 
Answer 
Please refer to the Law of the People's Republic of China on Bid Invitation and Bidding. Part 4 – Trade Policies by Sector  
4.2.5.3 – Rail Transport: paragraph 4.131, page 158 
 Improving the standardized subsidy mechanism for public welfare railways and transport is 
described as an objective of the general railway policy.  
 
1.  Will the definition of, and subsidy mechanisms for, public welfare railways be made public?  
 
Answer 
For details please refer to http://www.go v.cn/zwgk/2013-03/14/co ntent_2354218.htm. 
 
It is noted that the Chinese Ministry of Railway s will be undergoing certain reforms, such as 
separating its functions as both the regulator and operator of the national railway network and the rail price-setting mechanism.  
 
2.  Could China explain how far they have progressed with separating the operational function 
of the railways from the regulatory function? 
 
Answer 
In 2013, National Railway Administration and Chin a Railway Corporation were founded to separate 
enterprise's activities from governmental functi ons, and the Ministry of Railways transferred its 
administrative functions like drafting the railway development planning and policies to the Ministry 
of Transport. The Ministry of Transport is resp onsible for planning the development of railways, 
highways, waterways and civil aviation in a holistic way, accelerating the building of a 
comprehensive transport system. The National Railway Administration is governed by the Ministry 
of Transport, takes charge of other administrative functions of the former Ministry of Railways, and 
is responsible for drafting standards of railway  technologies, supervising and managing safe 
production of railways, quality of transport se rvice and railway projects. While China Railway 
Corporation focuses on railway transport of passengers and cargos carrying out diversified operation.   
Part 4 – Trade Policies by Sector  
4.2.6 Movements of Natural Per sons: paragraph 4.132, page 158  
 
It is noted that China encourages the movement of several types of foreign natural persons.  
 
1.  Could China provide more information about any regulations that facilitate the entry and 
stay of spouses and dependents of foreign professionals who are working in China?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
Foreign professionals shall apply for the License for Foreign Professionals Working in China. In the 
event that spouses and dependents come together, their application may be submitted together, 
including their names, nationalities and passport nu mber, etc. The competent authorities of foreign 
professionals will examine the application material s and issue eligible foreign professionals the 
License for Foreign Professionals Working in China (original copy), in which information of the 
accompanying family members shall also be stated. After obtaining the License for Foreign 
Professionals Working in China, the foreign profes sional and his/her family members may apply for 
visas for China at Chinese Embassy or consulate in their country with the License for Foreign Professionals Working in China (original), Visa Notice (letter or telegram) issued by the authorized 
unit and valid passports, and after entry to China,  they may apply for the Residence Permit at the 
local public security authorities.  
In accordance with Article 6 of the Regulations of the People's Republic of China on Administration 
of the Entry and Exit of Foreigners, "The S1 visa is issued to the spouses, parents, children under 
the age of 18 or parents-in-law of foreigners residing in China for work, study or other purposes 
who apply for a long-term visit to China, as well as for persons who need to reside in China for 
other personal matters; the S2 visa is for family  members of foreigners staying or residing in 
China for work, study or other purposes who apply for a short-term visit to China, as well as for persons who need to stay in China for other personal matters." Chinese embassies and consulates 
overseas issue S visas to eligible family members of foreign professionals. 
 Part 4 – Trade Policies by Sector  
4.2.6 Movements of Natural Per sons: paragraph 4.135, page 159 
 It is noted that China has introduced a new visa category – the R visa – for highly-skilled 
individuals whose expertise is in demand in China.  
 
1.  Could China provide more information on how the list of special urgently-needed skills is 
established and how often the list is updated?  
 
Answer 
According to Article 42 of the Exit and Entry Admi nistration Law of the People's Republic of China 
which came into force in 2013, " the competent department of human resources and social 
security and the competent department in charge of foreign experts affairs under the State Council shall, in conjunction with relevant departments under the State Council, formulate and regularly 
adjust the guiding catalogue for foreigners working in China based on the needs for economic and 
social development as well as the supply and demand of human resources." At present, the Guiding Catalogue for Foreigners Working in China is under formulation.  
As for how to determine the list of professional sk ills in urgent needs, China will determine types of 
talents in the urgent needs for economic and social development based on the National Medium and Long-term Talent Development Plan (2010-2020); and China will conduct a special 
investigation on post demands for foreign professionals, acquire demand information of special 
posts of employment units for foreign talents, so as to provide data support to prepare the Catalogue.  
 
Part 4 – Trade Policies by Sector  4.2.6 Movements of Natural Per sons: paragraph 4.141, page 159 
 
The Secretariat's report notes that China sets quotas on the employment of foreign nationals in a 
limited number of industries/sectors.   
1.  Could China provide more information about the industries/sectors where these quotas are 
currently applied and how the volumes of the quotas are set?  
 
 
   WT/TPR/M/300/Add.1 
 
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 Answer 
China is a country with a huge population, Chinese government encourages high-tech and skilled 
talents lacking in Chinese labor market as well as senior management and operation personnel in 
some special fields to work in China, but restricts common workers to work in China. Currently, 
quotas are only applied to the fishery industry. In the future, China will determine specific measures on application of quotas to special posts of special industries which need to employ 
foreigners. 
 Trade Policy Review – Report by China (WT/TPR/G/300)  
Part 2 – Economic and Trade Environment and Macroeconomic Policy Direction 
2.3.3 Pursuing Innovation-driven Developm ent and Protecting Intellectual Property 
Rights: paragraph 2.25, pages 8-9 
 
It is noted that the Chinese Government is committed to further promoting synergy between scientific innovation and economic developmen t, expediting the establishment of a new 
technological innovation system that is busine ss-centered, market-oriented and facilitates the 
combination of industry, academia and R&D institutions.   
1.  Could China outline how it sees the role of State Owned Enterprises in this technological 
innovation system, and the role of foreign owned businesses?  
 Answer 
Chinese government has long been promoting the open innovation; China's policies on innovation apply to all enterprises within the territory. Foreign owned businesses are a part of China's technological innovation system, the state gives equal treatment to foreign owned businesses in 
terms of China's national science &technology plan s and universally preferential policies, such as 
deduction of accumulative total of R&D costs, pref erential income tax on high and new technology 
enterprises, so as to fully motivate the driving fo rce and vigor of various enterprise for innovation.  
 
Part 2 – Economic and Trade Environment and Macroeconomic Policy Direction  
2.3.4 Advancing Energy Conservation, Pollution  Reduction and Industrial Restructuring: 
paragraph 2.31, page 9 
 
It is noted that from 2008-2012, China accumulatively closed down backward production capacities in iron-making, steel and cement production.  
 
1.  Could China please provide data on total production capacity in the aforementioned 
industries during the period 2008-2012?  
 
Answer 
Only estimated data of the total production capacities for some years are available in terms of 
iron-making, steel and cement production, no exact statistical data could be provided.  
 
Part 2 – Economic and Trade Environment and Macroeconomic Policy Direction 2.4 Continuing to Deepen the Reform Steadfastly: paragraph 2.35, page 10 
 
It is noted that the Government's core economic re form is to let the market play the decisive role 
in the allocation of resources and bring the role of the Government into better play.   
1.  Could China please provide more detail on the items of reform that have already been 
carried out comprehensively and elaborate on plans for further reform?  
 
Answer 
Since the adoption of the Decision on deepening the reform, policies and measures as well as 
institutional documents have been studied and promulgated in a timely manner in terms of reform 
of administrative approval, reform of industrial and commercial registration, reform of fiscal and 
tax system and reform of household registration system which are paid great social attention to and looked forward to by all walks of life. Le gal resolutions have even been made for some WT/TPR/M/300/Add.1 
 
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 reforms. Generally, these reforms have been acco mplished, promoted the decisive role of the 
market in allocation of resources and gave the government into better play.   
In the next step, the State will continue to streamline administration and delegate power to lower 
levels, focusing on cancelling administrative appr ovals which greatly impact investment to start a 
business and employment and obviously restrict social and economic development. The state will 
also deepen the reform of investment approval, ca ncel or simplify the pre-establishment approval, 
and facilitate investment to start a business.  Items subject to Administrative approval will be published in a list, items other than those in the 
list shall not be subject to administrative approval. China will accelerate exploration on market 
access through the negative list, items other than  those in the negative list will be gradually 
subject to the market entities based on law, so as  to achieve the goal that "anything can be done 
as long as it is not prohibited by laws." The industrial and commercial registration will be 
implemented across China to encourage market entities to play their new and dynamic role unceasingly. And China will further improve the macro-control system, promote formulation of the 
goals of macro-control and establish a mechanism for implement relevant polices.  
 Part 2 – Economic and Trade Environment and Macroeconomic Policy Direction  2.4.3 Reform of state-owned enterprises an d development of the non-public sector: 
paragraph 2.43, page 12 
 It is noted by China that, "Thanks to years of reform, China's state-owned enterprises have 
integrated themselves into market economy. The steps in the next phase of reform will include 
optimizing the distribution and structure of st ate-owned economy and ensuring the state-owned 
capital increases its input into public-welfare enterprises."  
 
1.  Does this statement mean that there will be no further reform efforts to reduce the 
number and the role of SOEs in the economy?  
2.  If China plans to reform the structure of SOEs to reflect market principles, could China 
elaborate on the rationale for maintaining thes e entities as SOEs rather than privately-
owned entities?  
 
Answer for questions 1 and 2 
China will further deepen the reform of SOEs base d on the following three principles: 1. insisting 
on the basic economic system; 2. Insisting on  the market-oriented reform; 3. Insisting on 
separating government administration from the management of enterprises, state assets, and 
separating ownership from management power. In the next step, China will adjust the layout of the state-owned economy in accordance with the requirement of the Third Plenary Session of the 
Eighteenth National Congress of the Communist Part y of China, actively develop economy of mixed 
ownership. Whether to reduce the number of SOEs  is not necessarily related to further deepening 
reform of SOEs. China will further specify the main direction and development path of layout of state-owned economy, and better serve the national strategic goals based on optimization of the 
function and overall efficiency of state-owned capital. And China will concentrate state-owned 
capital on major industries and key fields  as well as advantageous enterprises.  
 
Part 2 – Economic and Trade Environment and Macroeconomic Policy Direction 
2.4.3 Reform of state-owned enterprises an d development of the non-public sector: 
paragraph 2.43, page 12  
The 2012 Secretariat Report looked at SOEs reforms, noting that "Mergers/closures during the 
review period reduced the number of China's SOEs". This report provided figures on the number of 
SOEs, collective-owned enterprises, FIEs and domestic private enterprises (Table III.8).  
 
1.  Could China please provide these figures covering years 2011 2012, and 2013?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
According to the data published by the National  Bureau of Statistics, the number of business 
entities based on registration types is as follows: in 2011 and 2012, 156,323 SOEs, 187,065 
collectively owned enterprises, 124,102 foreign owned enterprises, 106,013 enterprises invested 
by Hong Kong, Macao and Taiwan and 5,254,87 0 private enterprises; in 2012, 159,644 SOEs, 
183,870 collectively-owned enterprises, 130,851 foreign owned enterprises, 112,602 enterprises 
invested by Hong Kong, Macao and Taiwan, 5,917,718 private enterprises. 
 
2.  Could China please comment on whether the number of SOEs has continued to decrease 
over this period?  
 
Answer 
As the SOEs have continuously merged and restructured, the number of SOE groups have 
decreased steadily. However, due to changes of the economy, the number of SOEs across China 
increases or decreases all the years, so there is no necessary relation to the said trend.  
3.  Are there plans to narrow the scope of areas where SOE dominance is to be maintained?  
 
4.  Could China list what it considers to be "natural monopoly industries" and explain why 
industries fall under this category?  
 
Answer 
To formulate and implement reforms of railway and telecommunications systems. China will launch 
the pilot reform of separating power distribution from power transmission, explore an effective way 
of implementing the separation between power tran smission and power distribution, accelerate the 
building of the regional power market, and promot e rural power system reform in all aspects. 
China will make the divestiture of some industrial administrative functions still assumed by 
relevant petrol enterprises, sort out the manageme nt system of oil exploration, mining, refining 
and circulation, study and establish the management system for fair access to oil & gas pipe network and universal service, and promote the fo rmulation of a fairly competitive market. China 
will encourage social capital to invest in urban utilities, establish a standardized method for 
investing in public urban utilities by the government, standards of industrial service and a  
supervision system for purchasing service and oper ation. China will deepen the reform of highway 
management system, insist that most highways are free of charge, and balance the development 
of charging highways and non-charging highways. China will reform the management system of air space, establish a mechanism for flexibly using the air space. China will deepen the reform of 
postal service system, improve th e guarantee and supervision system  for universal service. China 
will accelerate the reform of salt industry, remove the monopoly of salt sales.   Part 3 – Trade and Investment Development and Related Policies 
3.3.2Improving competitiveness through "g oing global": paragraph 3.40, page 22 
 It is noted that China has proposed the vision of establishing a "Silk Road Economic Belt" and a 
"Maritime Silk Road". 
 
1.  Can China provide more details into what trade-related policies China proposes that 
countries along the "Silk Road Economic Belt" and/or "Maritime Silk Road" implement to 
facilitate trade and investment? 
 Answer 
(1) To tap existing potential for increase in trade and optimize structure of foreign trade. China will 
further open the markets to each other, remove tariff barriers and non-tarrif barriers, deepen their cooperation in an around way in customs, quality inspection, e-commerce and across-border 
transport, improve economic and trade exchanges platforms such as conferences and exhibitions, 
and promote facilitation of trade. China will innova te the way of trade, vigorously develop across-
border e-commerce, encourage enterprises to construct warehouse and logistic bases and 
distribution centers at the traffic hubs along the economic belt, and improve regional marketing 
networks. China will optimize the trade structure, maintain the steady export of labor-intensive 
products, expand export of electro-mechanical products and high-tech products; while increasing import of energies and resources as well as agricultural products to countries along the economic WT/TPR/M/300/Add.1 
 
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 belt, enhance import of non-resource products; develop trade in service, promote balanced 
development of trade in service and goods.  (2) To coordinate going global and bringing in, and expand two-way investment and cooperation. 
China will lead conventional advantageous industries such as light industry, textile and 
construction materials as well as equipment manufacturers to invest and establish factories in the countries along the economic belt, help these countries to increase employment and tax income, 
and improve industrialization. China will cooperate in developing energy and resources with these 
countries and expand in-depth process cooperatio n, and extend the industrial chain. China will 
found a batch of economic and trade cooperation parks with the countries in their territories who have such intention and where conditions permit, in order to attract investment of enterprises of 
various countries in the parks, form an belt of industries where various countries draw on each 
other's strengths and interact each other. Meanwhile, China will continue to create a fair market and sound investment environment, steadily prom ote the establishment of economic cooperation 
zones along borders and across-border economic cooperation zones, so as to attract the countries 
along the economic belt to invest and run business in China.   
2.  Does China envision the "Silk Road Economic Belt" and/or "Maritime Silk Road" initiatives 
including preferential trade agreements between all the Silk Road countries?  
 Answer 
FTA is of significance for promoting orderly an d free flow of elements, allocating resources 
effectively and deeply integrating markets within the area. We would like to have free trade relationship with countries and regions along the economic belt.  
 
3.  Could China please describe what policies are involved in setting up a cross-border 
economic cooperation zone and overseas economic and trade cooperation zones? What 
benefits do they offer to exporters, producers and investors? 
 Answer 
In terms of policies, the across-border economic cooperation zone shall be suitable to local 
conditions according to different situations of the area and neighboring countries. China will 
implement liberalization and facilitation and ot her incentive policies, make the across-border  
economic cooperation zone a special economic function area which promotes free bilateral trade 
and investment, facilitation of personnel exchanges,  and integration of industries, and serves as a 
passage for bringing in and connecting outside world. Currently, in terms of fiscal and taxation policies, the across-border economic cooperation zone provides tax preference and exemption for 
construction materials entering the zone for infrastructure and equipment for self-use within the 
zone; in terms of trade policies, passengers are allowed to take tax-free goods of a certain amount of RMB from the zone into other regions of China; moreover, there are also facilitating measures on clearance of goods, inspection and quarantine as well as personnel exchanges.  
 
Supported by bilateral regional cooperation, in centive policies of the across-border economic 
cooperation zone may promote liberalization and facilitation of trade within the zone, increase 
appealingness, give the radiation effect of the ac ross-border economic cooperation zone into full 
play within in the region, and create a sound investment and operation environment and foster comprehensive competitive advantages.  WT/TPR/M/300/Add.1 
 
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 20  QUESTIONS BY COSTA RICA 
PART I: QUESTIONS REGARDING THE SECRETARIAT REPORT 
 
Page 8 (paragraph 2.22) 
 China states that since the last TPR, the Chinese Government has continued to encourage 
nongovernment investors to increase their investment in the service sector, taken various actions 
to deepen the reforms, and released the guiding opinions on promoting the development of information services, culture, elderly care, health and other service industries.  
1.  Can China please further explain the actions to deepen reforms and the sectors in which 
they have been adopted? 
2.  Can China please provide more detail in the content of the guiding opinions on promoting 
the development of information services? 
 Answer 
(1) In the area of administration system, the efforts in streamlining administration and delegating powers to lower levels have been stepped up and the reform of the administrative approval system 
has been deepened. (2) In the area of fiscal and taxation system, the scope of coverage of the pilot programme of 
levying value-added tax in lieu of business ta x has be expended. The pilot programme in 
transportation and modern service industry has been rolled out nationwide. From 1 January 2014, 
railway transportation and postal service has been  included into the pilot sectors. Research has 
been conducted on expanding the scope of inco me tax preferential policy on small and micro 
enterprises and the preferential policy has been extended until the end of 2016. (3) In the area of financial system, the range of fluctuation of the exchange rate of RMB against 
USD on foreign exchange market has been expanded.  
(4) In the area of investment and financing system: Administrative Measures on Approval and Filing of Overseas Investment Projects has been promulgated, which greatly extended the administrative level on overseas investment project, and slashed items requiring administrative 
verification. General overseas investment projects are subject to filing rather than verification.  
(5) In the area of pricing reform, the reform of la dder-type pricing of residential use of electricity, 
water and gas has been steadily pushed forward.  
(6) In the areas of opening up and state-owned en terprises, the China (Shanghai) Pilot Free Trade 
Zone has been launched; free trade agreements with Iceland and Switzerland has been signed; the free trade agreements between China and So uth Korea and between China and Australia are 
being accelerated; the implementation of paperless customs clearance is being accelerated and 
regional customs clearance reform has been started. Reform on state-owned enterprises and key industries has been deepened; the government f unctions and enterprise management functions in 
the railway system have been separated; Pilot pr ogramme on resale of mobile service has been 
launched. 
 Page 47 (paragraph 2.66) 
 
The Decision on Reforming the Investment Syst em (GuoFa [2004] No. 20) is the main guiding 
framework for China's outward investment. The Admi nistrative Measures on Outbound Investment 
stipulate the approval process. The Outbound Foreign Investment Catalogue indicates the sectors 
and countries where outward investments are encouraged. Basically, Chinese investors must seek approval and verifications from three key regu latory bodies: the NDRC, MOFCOM and SAFE. The 
nature of the procedure (approval or simple filing) and the relevant administrative level (central or 
local) depend on factors such as the type of investor (SOE or private), the place, the sector and 
the size of the investment. Outward investments in "sensitive" sectors, countries or regions require approval and verification at central levels. For all other investment projects, the size of the 
investment and the nature of the investing enti ty are the main criteria for determining the 
appropriate approval authority (Table 2.3).  
3.  Can China please explain the rationale for requiring approval and verification for outward 
investment?  WT/TPR/M/300/Add.1 
 
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 4.  What criteria are used in the Outbound Foreign Investment Catalogue to decide the 
priorities for encouragement of outward investments? Which are the "sensitive" sectors?  
5.  Can China please indicate the countries for which outward investments require approval 
and verification? 
 
Answers to Questions 3, 4 and 5 
The basis for verification and filing management of overseas investment projects is the Catalogue of Investment Projects Subject to Government Verification (2013 Edition), the Administrative Measures on Approval and Filing of Overseas Investment Projects (National Development and Reform Commission decree No. 9). Decree No. 9 clearly defines that the sensitive countries and 
regions include states without diplomatic relations with China or subject to international sanctions, 
or the states and regions suffering from wars or civil strife, and sensitive sectors include basic telecommunications operation, cross-border water resources exploitation and utilization, large-
scale land exploitation, main grid of power transmission, and news and media. The focus of 
overseas investment is determined mainly ba sed on the comparative advantage of Chinese 
enterprises and the focus of host country in attracting foreign investment. 
 
Page 58 (paragraph 3.12)  Preferential rules of origin apply in accordance with various preferential agreements signed by 
China or for granting preferential treatment to imports from LDCs. 
 
6.  Could China indicate the internal process of certification of origin carried out by each of the 
entities authorized under preferential rules of  origin? Specifically, could China indicate the 
internal process of certification of origin in free trade agreements signed by China, in particular the agreement between Costa Rica and China? 
 
Answer 
The General Administration of Customs is responsible for laying down the rules of origin for import and export products and their implementation in a ccordance with the law, hence, the preferential 
rules of origin under free trade agreements are implemented by the General Administration of 
Customs in accordance with the law. In the free trade agreement between China and Costa Rica, the issuing authorities of the certificate of origin are General Administration of Quality Supervision, 
Inspection and Quarantine (AQSIQ) and the China Council for the Promotion of International Trade 
(CCIPT) and their local agencies. Applicants of pref erential certificate of origin under the free trade 
agreement between China and Costa Rica should submit application to the issuing authorities 
t o g e t h e r  w i t h  r e l e v a n t  p r o o f  d o c u m e n t s .  F o r  a p p lications approved by the issuing authorities, 
preferential certificates of origin will be issued  in accordance with the rules in the free trade 
agreement between China and Costa Rica.   
Page 62 (paragraph 3.22) 
 Imports are subject to Value Added Tax (VAT), wh ich is collected by Customs on behalf of the 
State Administration of Taxation. VAT on imports is charged based on the c.i.f. price plus the 
import duty. If goods are also subject to the consumption (excise) tax, VAT is calculated including the consumption tax. VAT has two rates: 13% and 17%. Both the products subject to the 13% 
rate and those that are exempt have not changed since the previous Review. Agricultural products 
sold directly by the producer continue to be exempted from VAT, while imported goods are not.   
7.  According to Article III:4 of GATT, imported goods shall be accorded treatment no less 
favorable than that accorded to like products of national origin. Considering the rules 
under Article III.4, how does China evaluate the practice of collecting value added tax (VAT) on imported goods and exempt from paym ent the agricultural products sold directly 
by the producer? 
 WT/TPR/M/300/Add.1 
 
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 Answer 
Considering the large number of agricultural prod ucers, their small production scale and the low 
added value of their products, as well as the cost for levying tax, agricultural goods produced and 
sold directly by small-scale farmers are exempted  from the VAT. But the wholesale and retail of 
agricultural products are levied VAT according to relevant regulations, subject to the same taxation policy on imported agricultural products. So we think the afore-mentioned rules are in compliance 
with the requirements of GATT. 
 Page 68 (paragraph 3.46)  
Paragraph 3.46 states that Article 56 of the anti-dum ping regulations allows the authorities to take 
corresponding measures when a trading partner ''discriminatorily'' imposes anti-dumping measures on exports from China. 
 
8.  What are the criteria used to determine that a partner is ''discriminatorily'' imposing an 
anti-dumping measure?  
9.  What procedure would be followed if there is a domestic determination that an anti-
dumping measure is being applied "discriminatorily" but a WTO panel determines otherwise? 
 
Answer 
China has never applied Article 56 in practice and there is no explicit rules on the criteria of 
''discriminatorily'' imposing an anti-dumping measur e by a partner. China has already clarified that 
before taking corresponding measures in respec t of a WTO Member, China would resort to the 
relevant WTO dispute settlement provisions.  
Page 74 (paragraph 3.69) 
 It states that when a standard is mentioned in a regulation, it becomes mandatory.   
10.  Are there cases in which standards have a cost and are named in a regulation? What 
specific cases?  
 
Answer 
Please further clarify the question. 
 
Page 93 (paragraph 3.135) 
 Paragraph 3.135 states that the AML covers monopolistic operations that have an effect on the Chinese market - that is, operations within China as  well as activities outside the territory of China 
that have eliminative or restrictive effects on competition in China's domestic market. 
 
11. How can China impose sanctions on companies engaging in monopolistic operations 
outside its territory without implying an extraterritorial application of China's competition 
legislation? 
 
Answer 
As stipulated by Article 2 of the Anti-Monopoly Law, monopolistic conducts in economic activities 
within China are covered by the law; monopolistic conducts outside the territory of China that have eliminative or restrictive effects on competition in  China's domestic market are covered by the law. 
Accordingly, foreign enterprises are governed by the Anti-Monopoly Law in two cases: one is when 
they have monopolistic behaviors within China, and the other is when their monopolistic behaviors outside the territory of China have effects on China's domestic market. 
 WT/TPR/M/300/Add.1 
 
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 Page 115 (paragraph 3.224) 
 There is no specific legislation for geographical indications (GIs) in China. They are covered by the 
Trademark Law and its Implementing Regulations an d may be registered as collective marks or 
certification marks with the TMO under the same procedure as for trademarks. GIs may be also 
registered with AQSIQ or the Ministry of Agriculture. The party concerned can voluntarily choose 
under which governmental agency (ies) to register its GIs. Once infringements occur, the interests 
of the party will be protected pursuant to the relevant laws and regulations under which its GIs are registered. In case a single GI is registered fo r protection with different agencies, each agency 
would play its due regulatory role strictly according to its respective mandate. 
 
12. According to the above description there are two ways in which GIs might be registered in 
China. How can a rightholder decide which is the best procedure to follow, TMO or Ministry 
of Agriculture? 
 Answer 
China currently has two modes of protection for geographical indications (GI), i.e. parallel protection by special laws and Trademark Law. The Ministry of Agriculture adopts special law 
protection mode to protect produce GI's in acco rdance with the Agriculture Law, the Law of the 
People's Republic of China on Quality and Safety of Agricultural Products and the Measures for 
Administration of Geographical Indications of Agricultural Products. Right holders can voluntarily 
choose special law mode or Trademark Law mode taking into account the protection level of different modes and their own need. They may also simultaneously register under different 
systems in order to receive joint protection from multiple agencies as long as the right holder is 
the same body.   
13. Do foreign rightholders have to pay a fee to register a GI? If so, how much is it? 
 Answer 
As the specific measures on the registration and protection of foreign geographical indications is 
not yet published and implemented, the Ministry of Agriculture now adopts equivalent protection 
by signing bilateral geographical indication recognition agreements, and will make detailed provisions on related fees with reference to international practices and produce geographical 
indication registration measures of other countries. 
 Protection through registration of trademark is su bject to fees. Registration fee of collective marks 
is RMB 3,000, and registration fee of certification marks is RMB 3,000. 
 Seeking protection through the AQSIQ does not need to pay any fee.  
Page 131 (paragraph 4.30) 
 A minimum procurement price scheme remains in place for rice and wheat in major producing 
areas. Minimum prices for grains (rice and wheat) are set every year by the National Development 
and Reform Commission (NDRC) in consultation with the Ministry of Agriculture and other governmental institutions. During 2007-12, the minimum prices for rice and wheat were increased 
each year on the basis of the growing costs of ag ricultural production. If the "market" price goes 
below the established support level, the Government, through the state-owned company Sinograin, purchases grain. The Government holds auctions as required to ensure a stable supply of grains and to prevent the price from incr easing. The minimum procurement price scheme for 
grains is linked with China's grain reserves as th e minimum prices system is in place supposedly to 
ensure a stable supply of grains.   
14. What is the value of the AMS applied in 2011 and 2012 to the products in which a 
minimum support price is set?  
15. For those years, is the "amber box" support within bound levels? 
 WT/TPR/M/300/Add.1 
 
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 Answer 
In 2011, the prices of wheat and rice are higher  than the minimum price set by the Government, 
thus no purchase is implemented. For detailed information, please see to the website of the 
National Grain Bureau. China's AMS is zero as our AMS support does not exceed the 8.5% limit. 
 Answer 
In recent year, China has established and improved policies with four types of subsidies as the core, which are direct subsidy to farmers, comprehe nsive subsidy for agricultural inputs, subsidy to 
promote the use of superior strains and seeds and subsidy to purchase agricultural machinery and tools, and has formulated an agricultural support system that is in line with China's WTO 
commitments and WTO rules. 
 Page 159 (paragraph 4.141) 
 
No quotas are set in the management rules for the employment of foreign nationals in China, but there are some quotas at the sector/industry level, such as fisheries. Those quotas are set in 
proportion to the number of Chinese nationals em ployed. So far, these quotas only exist in a 
limited number of industries/sectors but new quotas will probably be introduced in other sectors/industries in the future, while the level of the quotas themselves will be raised.  
16. Can China please clarify the expression "limited number of industries/sectors". How many 
industries/ sectors does this refer to? In which sectors is China seeking to introduce quotas in the future? 
 
Answer 
Chinese government will determine if it is necessary  to set quotas for employment of foreigners for 
certain posts in accordance with the demand of domestic labor market in future.  
 
17. Are the possibilities of introducing new quotas and/or raising the existing quotas 
compatible with the ratchet principle? 
 
Answer 
It is a part of China's national development strate gy to expand the opening up of service industry. 
The direction of opening up to outside world will  not be changed and will be adhered to over the 
long run.   
Page 167 (table A2.1) 
 Principal notifications under WTO Agreements (as of 30 April 2014)  
18. According to table A2.1, China´s last notification on domestic support was on September 
2011 (G/AG/N/CHN/21). Given the absence of notification for recent years, how can we ensure that the bound levels of agricultural support of China do not exceed the limits? 
 
Answer 
In recent year, China has established and improved policies with four types of subsidies as the 
core, which are direct subsidy to farmers, comprehe nsive subsidy for agricultural inputs, subsidy to 
promote the use of superior strains and seeds and subsidy to purchase agricultural machinery and tools, and has formulated an agricultural support system that is in line with China's WTO commitments and WTO rules. 
 
19. When will China notify the levels of support for 2011, 2012 and 2013? 
 
Answer 
Due to huge amount of data, the involvement of  various agencies and complexity of working 
process, and also because the relevant data on domestic support is now being collected, China will 
accelerate the work and will provide notification to the WTO when ready. 
 WT/TPR/M/300/Add.1 
 
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 PARTE II: QUESTIONS REGARDING THE GOVERNMENT REPORT 
 Page 9 (paragraph 2.26) 
 
Since its last review, the Chinese Government has continued to strengthen its law enforcement in the IPR protection and the construction of a long-term mechanism. China's newly elected 
government retained the National Leading Group on the Fight against IPR Infringement and 
Counterfeiting headed by a vice premier of the State Council. The government is also pushing 
forward the initiative to incorporate the outcomes of IPR protection against infringements and counterfeits into government performance evaluation system at different administrative levels. 
 
Thanks to China's constant and highly aggressi ve law enforcement, IPR infringements and the 
manufacturing or selling of counterfeiting commodities have been effectively suppressed. 
20. Can China please provide more detail on the specific actions and measures adopted by the 
National Leading Group on the Fight against IPR Infringement and Counterfeiting? 
 
Answer 
The General Office of the State Council issued 2014 Guidelines on the Nationwide Fight against IPR 
Infringement and Counterfeiting, which clearly defined six areas of work. (1) To organize special campaigns on serious problems, including cracking down on illegal online 
infringement and counterfeiting, strengthening protection for trade secret according to law; 
enhancing administrative law enforcement and judicial protection; and improving relevant measures to enhance complaint settlement and protect the trade secrets in the technical 
documentation submitted by enterprises according to law.  
(2) To launch centralized rectification actions on key areas, including special campaign on agricultural material counterfeiting, launching "Quality Inspection Sword" campaign to crack down 
on illegal import and export of counterfeit and shoddy commodities, illegal trademark 
infringements, and illegal counterfeiting of well-known trademarks, packaging and decoration; cracking down on illegal copyright infringements, improving supervision measures against risk of 
infringement to goods in port, enhancing enforcement system of customs intellectual property 
rights protection; and promoting the use of copyrighted software.  
(3) To enhance criminal justice and to fight crimin als, including supervising special criminal cases 
endangering food and drug safety and reinforcing supervision on pursue, prosecution and litigation 
of crimes of manufacture and sale of counterfeit goods in related areas; strengthening judicial 
process of crimes of IPR Infringement and Counter feiting in key industries and areas, increasing 
applicable fine penalty, and organizing live broadcasting of the trial of major cases.  
(4) To deepen reform and innovation and improv e institutional construction, including promoting 
revision of the Copyright Law, Patent Law, Seed Law, Implementing Regulations on Trademark Law, Regulations on Patent Commissioning, and pr eliminary study on the revision of Anti-Unfair 
Competition Law and Regulations on Customs Protection of Intellectual Property; strengthening 
coordination between administrative law enforcement and criminal justice; accelerating disclosure 
of administrative penalty cases, and sorting an d disposing of IPR Infringement and counterfeit 
goods to be destroyed in an environment friendly  way. (5) To enhance publicity and education and 
expanding external communication, including streng thening routine publicity and education. (6) To 
lay a good working foundation and enhance capabi lity building, including improving legal service 
system on reporting and complaint and implementing reporting award measures, promoting 
special IPR legal service, assisting enterprises in  building and improving internal IPR management 
system and improving their awaren ess and ability in preventing infringement risk and in right 
protection according to law.  
21. Can China please provide more detail on it plans to include the outcomes of IPR protection 
against infringements and counterfeits into the government evaluation system. How will it 
measure such outcomes? 
 WT/TPR/M/300/Add.1 
 
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 Answer 
Since 2012, China has included the outcomes of IP R protection into the government evaluation 
system. Every year the Leading Group of the National Campaign Against IPR Infringement and 
Counterfeit Products will establish evaluation criteria and organize evaluation of the performance in 
IPR protection of local governments. The evaluation  involves both special rectification campaign of 
the year and building of long-term mechanism in improving institutional system and publicity and 
education. The scoring of the evaluation is outcome oriented.  
Performance evaluation helps local governments to  take their responsibilities, to integrate law 
enforcement resources and to strengthen the cracking down on IPR Infringement and Counterfeiting. On the whole, after two years of performance assessment, local governments of all 
levels have improved their awareness of the work against IPR Infringement and Counterfeiting, 
resulting in more specific measures and better performance in this work. WT/TPR/M/300/Add.1 
 
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 21  QUESTIONS BY INDONESIA 
GOVERNMENT REPORT  
 
3 TRADE AND INVESTMENT DEVELOPMENT AND RELATED POLICIES  
3.1 Trade and Investment Development  3.4 Constructing Economic and Trade Partne rships Based on Mutually Beneficial and 
Win-Win Principle  
3.4.1 Committed to advancing the Doha Development Agenda   Page 22, para. 3.45  
"China has actively participated in the "early harvest" negotiation on various areas with a 
constructive role of "facilitate the discussions, br idging the gaps and advancing the deal", and has 
been always showing flexibilities in the course of reaching agreements. In the negotiations on 
trade facilitation, China takes the lead in expressing that it will refrain from requesting for aid, 
leave resources to other developing members and provide supports to fellow developing members through "South-South Cooperation" within its capa city. On agriculture, China proposes the "peace 
clause" as the middle ground of the interim solution of food security, which was ultimately 
accepted by all Members, paving the way for achieving the "early harvest". On development issues, China has adopted substantial measures to address the concerns of LDCs, in particular on the issues of "DFQF" and cotton. During the MC9,  China announced to provide further assistance 
to "Cotton Four" countries from Africa. China has played an active and constructive role in 
ensuring the success of MC9 held in Bali, Indonesia, at the end of 2013."   
Question 1 
How does China utilize the "peace clause" me chanism relating to public stockholding?  
 
Answer 
Public stockholding is vital for developing countri es to safeguard food security. China is willing to 
work with Indonesia and other G33 members on the discussion of peace clause utilization as well as the permanent solution of food security proposal. 
 
Page 23, para. 3.47  "China believes that the "Post-Bali" work programm e shall be designed for the complete conclusion 
of the Doha round, with a focus on the development dimension and due respect on Doha mandate 
and the results achieved so far. The work programme should be pragmatic, balanced, feasible and beneficial to all Members, which should bring the developing members and the LDCs in particular 
more development opportunities. The discussions on "post-Bali" work programme should be 
member-driven, transparent and inclusive to ensure the effective participation of all the parties."   Question 2 
We would like to know China's view on how to drive initiate the Post Bali Programme for the 
conclusion of Doha Development Agenda (DDA) negotiation?   
Answer 
China will actively participate in the discussion of the post-Bali agenda.  
 
3 TRADE AND INVESTMENT DEVELOPMENT AND RELATED POLICIES  
3.1 Trade and Investment Development  3.4 Constructing Economic and Trade Partne rships Based on Mutually Beneficial and 
Win-Win Principle  
3.4.4 Enhancing South- South cooperation  
 Page 24, para. 3.60  
"China is one of the developing countries gran ting the biggest market access to LDCs. Since 1 
January 2014, China had granted zero-tariff to 95 % of tariff items (according to China's tariff 
items) from 35 LDCs which had diplomatic ties wi th China. In March 2013, President XI Jinping 
announced at the BRICS Leaders-Africa Dialogue Forum that China would accomplish its goal by 
2015 of granting zero-tariff treatment to 97% of the tariff items of exports to China from the LDCs which have diplomatic ties with China."  WT/TPR/M/300/Add.1 
 
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 Question 3 
Please provide the details of in which tariff items China will grant zero tariffs to LDCs?  
 
Answer 
See the website of Department of Customs of the Ministry of Finance 
http://gss.mof.gov.cn/zhengwuxinxi/zh engcefabu/201306/t20130625_935120.html. 
 
SECRETARIAT REPORT   Summary  
 
Page 10, para. 10  "China became a WTO Member on 11 December 2001. China is an observer to the Plurilateral 
Agreement on Government Procurement (GPA) and is in the process of negotiating its accession 
thereto. China is an observer to the Plurilate ral Agreement on Trade in Civil Aircraft, and a 
participant in the Information Technology Agreement (ITA). China's notifications to the WTO cover 
a wide range of agreements; however updated notifications appear to be necessary in the area of 
subsidies. Between 2012 and 2013, China was involved in 4 dispute settlement cases as a complainant, 8 cases as a respondent, and 15 cases as a third party."  
Question 4 
Could China provide information on its intention to submit notifications on the area of subsidies during period under review?  
 
Answer 
China is preparing the next subsidy notification.  
 
Page 10, para. 12  "China's trade and investment policy is managed and fine-tuned through a number of legal instruments, including Central Government Five Year Plans, sectorial and provincial Five-Year Plans 
and different Catalogues that guide in the impl ementation of the overall policies and list the 
industries that can receive preferential trea tment and the sectors in which investment is 
encouraged, just permitted or prohibited. It is not always clear how the different Catalogues 
should be read, as they sometimes overlap and even conflict, reflecting the different agendas at 
the different levels. The different layers of regulation add an additional level of difficulty when trying to unravel specific policy measures in China." 
 
Question 5 Would China simplify the trade and investment policy between central government and sectorial and provincial policy to avoid additional difficulties for exporters and investors?  
 
Answer 
Chinese government is further transforming gove rnment functions, streamlining administration, 
delegating powers to lower levels, deepening th e reform of the administrative examination and 
approval system, and minimizing administration of the central government in micro affairs and economic activities that may be regulated effectively by market mechanism. In 2013, in 
institutional reform of the State Council, 416 items previously subject to the State Council's 
examination and approval were abolished or dele gated to lower level governments. In December 
2013, the State Council issued the new version of th e Catalogue of Investment Projects Subject to 
Government Verification, which slashed items requ iring administrative verification, and delegated 
20 verification powers to local governments. Next, according to the decisions made at the Third 
Plenary Session of the 18th National Congress of the Communist Party of China, we will continue to deepen administration system reform, further streamline administration, and delegate powers 
to lower levels, so as to allow market to play a decisive role in allocating sources, while leaving the 
government better play its due role at the same time. In trade, we will focus on improvement of 
supervision and services on customs, quality inspection, and foreign exchange, so as to further 
facilitate the trade. In investment, we will deepen the investment system reform, and establish the 
enterprises' positon as the players. Additionally, most of local governments at all levels have set 
specialized service agencies, which may provide co nvenient consultation and other services for 
foreign investment. WT/TPR/M/300/Add.1 
 
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 Page 13, para. 29 
"Agriculture continues to receive support to guar antee farmers' income, develop rural areas, and 
ensure food security and price stability of agricultural products in the domestic market. The four 
main subsidies in place to support the sector are: the subsidy to promote the use of superior 
strains and seeds, the subsidy to purchase agricultural machinery and tools, the comprehensive subsidy for agricultural inputs, and the direct subsidy to farmers."  
 
Question 6 Could China elaborate its subsidy programs given directly to farmers?   
Answer 
Details please refer to Program 63 of China's SCM notification for 2005-2008, as listed in 
document G/SCM/N/155/CHN and G/SCM/N/186/CHN. 
 
Question 7 Does China view these subsidy programs in agriculture sector as being consistent with SCM 
Agreement and/or Agreement on Agriculture?  
 Answer 
China implements agricultural subsidy policy in accordance with SCM Agreement and Agreement 
on Agriculture of WTO, as well as its WTO accession commitments. 
 Page 13, para. 31  
"China applies price controls to commodities and services deemed to have a direct impact on the 
national economy and people's livelihoods. They are set both at the central and provincial levels. Price controls may take the form of "government prices", fixed prices set by the authorities, or 
"government-guided prices", for which a range within which prices can fluctuate, is determined. 
The determination of government prices or govern ment-guided prices varies in accordance with 
the type of product or service, based on criteria su ch as market situation, average social costs, the 
effect on the standard of living of the population , as well as on economic, regional and seasonal 
factors. Although the methodology for setting prices is the same across provinces, prices may be 
set at different levels depending on the particular province."   
Question 8, 9 and 10 
Could China give more information on what kind of commodities and services price controls are applied?  
How does China determine government price in services?  
How does China monitor the price control particularly in services?   Answer 
At present, China only has a small amount of commodities and services (see Accessory 4 of the 
Protocol) subject to government pricing or government-guided prices for its WTO accession commitments, and most of commodities and services are priced by the market completely. 
According to "the Price Law", presently, the range for Chinese government pricing is mainly limited 
to a small amount of public utilities, public welfare services, and network links of natural monopoly and the main services subject to government-guided prices are government investment projects of 
direct investment or capital injection and some services commissioned by the government. 
Concerning standards for government-guided prices, the main considerations are the service suppliers' cost, taxation expense, and profit, as well as the service buyers' affordability.  
1 ECONOMIC ENVIRONMENT  
1.2 Developments in Trade an d Foreign Direct Investment 
1.2.3 Foreign direct investment  
 
Page 31, para 1.51  "As mentioned above, the Government is trying to  facilitate FDI inflows through the removal of 
restrictions, such as the revision of its Inve stment Catalogue and by simplifying procedures, 
including by eliminating verification requirements  in a number of cases (sections 2.5.1 and 2.5.2). 
It also seeks to attract further FDI through a number of incentive schemes (section 2.5.3) and through the more liberal rules applied to the CSPFTZ (section 2.5.4)." WT/TPR/M/300/Add.1 
 
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 Question 11 
Could China please elaborate further these incentive schemes?   
Answer 
Before 2008, the actual tax burdens on foreign-in vested enterprises were apparently lower than 
those on domestic enterprises in virtue of the subsidies granted in way of preferential tax 
treatment. For the purpose of creating a fair taxation environment for all kinds of enterprises and 
fully implementing the non-discrimination principle, China implemented the newly formulated the Enterprise Income Tax Law and its implementation regulations from 1 January 2008, terminating the situation under which domestic and foreign-invested enterprises were subject to different EIT 
treatment, a situation that had lasted for over 20 years, and levying the EIT at the same rate on 
foreign-invested enterprises and domestic enterprises.   
1 ECONOMIC ENVIRONMENT 
1.2 Developments in Trade and Foreign Direct Investment  
1.2.3 Foreign direct investment  
 
Page 33, para 1.54, Table 1.7 "During the period under review, China has reinforced its role to become an important source of FDI. In 2012, outward FDI totalled US$70.1 billion, with the main destination being Hong Kong, 
China, with two-thirds of the total, followed by the Cayman Islands, the British Virgin Islands, 
Australia, the United States and the United Kingdom (Table 1.7). Most FDI are in the areas of energy, mining, manufacturing, services and infrastructure."  
 
Questions 12 and 13 Why is China's outward FDI to Indonesia smaller than to other countries?  
Does China have a plan to increase its outward FDI to Indonesia in the future?  
 Answers for Questions 12 and 13 
Chinese enterprises' outward FDI programs are decided by their own independently based on 
relevant business principles and market conditions. Chinese government will not intervene or make 
such a plan.  
2 TRADE AND INVESTMENT REGIME 
2.5 Foreign investment regime 2.5.1 Regulatory framework and market access 
 
Page 42 Para. 2.46  "The Catalogue for the Guidance of Foreign Investment Industries (Investment Catalogue) is the main reference for the classification of projects . It lists the industries that are encouraged, 
restricted or prohibited. The Catalogue was revised in 2011 to reflect the goals adopted in the 
twelfth Five-Year Plan (2011-2015). The revised Catalogue is considered a step towards further opening up the economy as it included more projects in the encouraged category, removed some 
from the restricted and prohibited categories, and relaxed some restrictions on the form of 
investment in certain industries (Table 2.2)."   
Question 14 
Could China give us information on how to get a copy of Investment Catalogue and its revised version?  
Answer 
The "Catalogue for the Guidance of Foreign Investment Industries" has been issued in full text on 
websites of MOFCOM and NDRC, and also, it  may be consulted at http://www.fdi.gov.cn. 
 
Page 44 Para. 2.51 "Foreign investors may also be allowed to own some shares in state-controlled enterprises in 
certain sectors. There are no restrictions on lending by domestic banks to FIEs." 
 WT/TPR/M/300/Add.1 
 
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 Question 15 
In what sectors are foreign investors allowed owning some shares in the state-controlled enterprise?  
 
Answer 
In 2010, Chinese government issued the Several Opinions of the State Council on Further Doing a 
Good Job in the Utilization of Foreign Investment for encouraging foreign investors to participate in 
the restructuring reform as well as merging and reorganization of Domestic enterprises including the state-owned enterprises through shares and mergers & acquisitions. The Catalogue for the Guidance of Foreign Investment Industries is a re ference for review of foreign investment projects 
and applicability of relevant policies for the foreig n- invested enterprises, and the foreign investors 
may consult the Catalogue as investing in kinds of enterprises.  
2 TRADE AND INVESTMENT REGIME  
2.5 Foreign investment regime  2.5.2 Examination and approval procedures  
2.5.2.1 Inward investment  
 Page 46, para. 2.56 "Verification consists in the examination of the investment project. It is carried out by the NDRC 
for projects at the national level, or by the co rresponding provincial DRCs for projects at the 
provincial level or under a certain threshold (see below). A number of conditions need to be met, including those related to the environmental effect  of the project, and land use. Filing is a 
simplified process handled by the competent local authorities; in general foreign-invested projects 
are subject to the same requirements as domestic  investment projects. The formalities to be met 
regardless of the need for verification include: approval of the establishment of the enterprise; 
obtaining the required FIE approval certificates; application for a business licence; and registration 
with the relevant authorities (taxation, customs, foreign exchange, regulatory body). The process for FDI approval in the services sectors is govern ed by sector-specific laws and regulations (for 
example, subject to minimum capi tal requirements in banking)." 
 
Question 16 What is the minimum capital requirement in banking sector for FDI approval as stated in sector-
specific law?  
 Answer 
According to Article 8 of the Regulation of the Peop le's Republic of China on the Administration of 
Foreign-funded Banks, the registered capital for a wholly foreign-owned Banks and Sino-foreign joint venture Banks shall be at least 1 billion yuan RMB or equivalent convertible currency. The registered capital shall be contributed capital. 
 
3 TRADE POLICIES AND PRACTICES BY MEASURE  3.1 Measures Directly Affecting Imports  
3.1.8 Standards and other technical requirements  
3.1.8.2 Product certification   
Page 73, para. 3.67  
"The Standardization Administration of China (SAC),  under AQSIQ, continues to be the agency that 
centralizes the administration of the standardizatio n system in China. The SAC is assisted by the 
National Development and Reform Commission (NDR C), the State Food and Drug Administration, 
the China Association of Standards (CAS), a number of ministries, and local and industry 
standardization associations. In addition, the AQSIQ ensures that both imports and exports comply with technical regulations and certification requirements. There are other organizations such as the 
China Association of Standards (CAS) and non-governmental organizations affiliated to AQSIQ that 
support SAC and other institutions in the development of standards through research and international cooperation to promote the use of best international practices in the development of 
China's standards so that they comply when possi ble with existing international standards. These 
institutions also disseminate the proper use and application of standards."   WT/TPR/M/300/Add.1 
 
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 Question 17 
Could China give us detailed information of the other organizations that support SAC and other institutions in the development of standards?  
 
Answer 
Website of SAC: http:// www.sac.gov.cn. 
The websites of relevant ministries and commissions may be consulted at the website of the 
Central People's Government of the PRC: http:// www.gov.cn. 
Website of China Association for Standardization: http:// www.china-cas.org. 
 
Question 18 
What is the different function of these institut ions between the two types of certification?  
 
Answer 
In China, the standardization institution and cert ification institution are two independent systems, 
and so there is no relation between them. 
 
Page 75, para. 3.72  "China administers two types of certification: a voluntary certification and a compulsory certification system. China National Certification and Accreditation Administration (CNCA) under 
AQSIQ manages both systems."  
 Questions 19 and 20 
Could China gives us detailed information on voluntary certification system?  
What is the difference between the two types of certification?   
Answers to Questions 19 and 20 
Since 1990s, China has begun to carry out CQC certification, in which several evaluation systems 
for energy-saving and water saving, environmenta l protection, renewable energy, and safety and 
quality, as well as industries of energy, transporta tion, railway, agriculture, machinery, electronics, 
environmental protection, and carbon emission, are involved. The work has progressed a lot under 
the guidelines of CNCA for unified management an d joint implementation, and played an important 
role in guiding the industries for development, op timization and upgrade, promoting the levels of 
enterprises in management and product quality, as well as saving energy and protecting the 
environment. The CQC certification is conducted upon voluntary ap plications of the enterprises. It is based on 
national mandatory or recommended directive st andards, industry standards, and technical 
specifications for the certification. The agencies for certification and their implementation process 
shall comply with the "Regulations of the Peop le's Republic of China on Certification and 
Accreditation". 
The CCC certification system is formulated accord ing to the Product Qualit y Law of the People's 
Republic of China, the Regulati ons of the People's Republic of China on Certification and 
Accreditation, and the Special Rules of the St ate Council on Strengthening the Supervision and 
Management of the Safety of Food and Other Produc ts. It is mainly based on national compulsory 
standards. The products that have been listed in the compulsory certification directory may leave factory, and be sold, imported, and used in business activity only after they are certified and 
labelled. 
 Page 75, para. 3.74  "In 2012, the Catalogue included some 157 products classified in 22 categories, including, 
electrical wires, circuit switches, low-voltage electrical apparatus, low power motors, electrical 
tools, household electrical appliances, audio and video equipment (excluding audio equipment for broadcasting service), information technology equipment, telecommunication terminal equipment, 
motor vehicles and safety parts, tyres for motor vehicles, safety glass, agricultural machinery, 
latex products, medical devices, fire-fighting equi pment, safety protection products, wireless LAN 
(local area network) products, home décor, an d remodelling products and toys. In 2012, there 
were 629 tariff lines at the 10-digit level (431 at the 8-digit level) that were subject to the CCC 
mark. Most of the lines (83.5%) covered items in HS Chapters 84 (machinery and mechanical appliances), 85 (electrical machinery and equipment), and 87 (vehicles). Some 25% of the goods (mainly automobiles) that require the CCC mark ar e also subject to auto matic licensing, and non-WT/TPR/M/300/Add.1 
 
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 automatic licensing applies to some 10% of the goods requiring the CCC mark, mainly electronic 
goods. In addition, 58% of all g oods that require the CCC mark are also subject to quarantine or 
compulsory inspection."  
 
Question 21 How are automatic licensing and non-automatic lic ensing relating the CCC marks implemented?  
 
Answer 
According to relevant stipulations of WTO, as well as the Foreign Trade Law and the Measures for the Administration of Automatic Import License of  Goods, we implement administration measures 
for automatic import license for some products. The objective of administration measures for 
automatic import license is to strengthen real time import monitoring, and get hold of the overall import situation, so as to provide public informat ion services for the trades. The goods catalogue is 
subject to dynamic adjustment, and at the end of each year, the catalogue of goods with 
automatic import license for the next year will be released.  
Page 75, para. 3.75  
"Applications for the CCC must be made to the authorized accredited certification bodies (ACB) designated by the CNCA, each of which is authorized to provide certification for several products subject to the CCC. There are 13 mandatory cert ification bodies. The pr ocedures to apply for 
compulsory certification have not changed substantially since the previous Review and are 
stipulated in the Mandatory Product Certification Regulations. In general there are five major steps in the CCC certification application process: (i) submission of an application and supporting 
materials; (ii) type-testing (a CNCA-designated test laboratory in China will test product samples); 
(iii) initial factory inspection (a CNCA-designated certification body will send representatives to inspect the manufacturing facilities for the product); (iv) evaluation of certification results and 
approval (or failure or retesting); and (v) supervision after the certificate is granted. However, 
each certification body may have different application procedures, according to the product's characteristics. CCC certificates are valid for five years from the date of approval of the 
application. Applications to re new the CCC certificate should be submitted 90 days prior to the 
expiry of the certificate."  
 Question 22 
Concerning type-testing, how does China conduct laboratory test?  
 Answer 
For requirements on type testin g of products subject to CCC certification, see the implementing 
rules released by CNCA regarding compulsory prod uct certification, and for specific implementing 
rules on product certification, see the following website: http://www.cnca.gov.cn/ywzl/rz/qzxc pzl/ssgz/201307/t2 0130717_1597. shtml. 
 
Question 23 Does China accept the result testing from foreign laboratories which have Mutual Recognition 
Agreement (MRA) with CNCA?  
 Answer 
The designated certification institutions in China may accept the test results determined in bilateral or multilateral agreements signed by Chinese gove rnment or government sectors, e.g. under the 
framework of the multilateral agreement of IECE E-CB, and under the framework of a bilateral 
agreement, the Cooperation Agreement on Conformi ty Assessment of Electronic or Electrical 
Products and Relevant Parts Between the Governme nt of the People's Republic of China and the 
Government of New Zealand, which was signed by China and New Zealand.  WT/TPR/M/300/Add.1 
 
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 3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade 
3.3.1 Incentives 
3.3.2.6 Price Controls 
 
Page 92, Table 3.12  
In the Secretariat Report, the Chinese government has policy on subsidizing certain sectors for 
resources (materials, land, and technology) which is called National Old Industrial Base Adjustment and Renovation Plan (2013 – 2022). In supporting the policy, the Chinese government 
provides various supports as stated in Table 3.12.  
 
Subsidy  Type of Subsidy Legislation  
Industry  
Famous Brand and China World 
Top Brands Programme  .. .. 
State Special Fund for Promoting Key Industries and Innovation Technologies  ..
 .. 
Subsidies for fuel-efficient vehicles  .. The Renewable Energy Law  
Questions 24, 25 and 26 
What are the objectives of this programme?  
Who are the beneficiaries of this programme?  What are the forms and the mechanism of the su pport, how much funds provided by the Chinese 
government?  
 
Answer to Questions 24 to 26 
All the 3 subsidies mentioned in the report of the Secretariat have not been listed in the Plan for 
Transforming and Upgrading Old Industrial Bases Nationwide (between 2013 and 2022) 
(hereinafter referred to as the Plan. The Plan is the guidance for economic development of old industrial bases as well as development of relevant enterprises. There is no specific means for 
support and policies for subsidies in the Plan. 
 3 TRADE POLICIES AND PRACTICES BY MEASURE  3.3 Measures Affecting Production and Trade  
3.3.2 Competition Policy and Price Controls  
3.3.2.6 Price Controls  
Page 100, para. 3.168  
"Government prices are applied to items subject to state monopoly, such as tobacco and salt, and to public-interest items, such as educational ma terial. Government-guided prices are applied to 
refined oil, fertilizers, and natural gas. Products classified as the State's key reserve materials 
(grain, cotton, sugar, silkworm cocoons, crude oi l, processed oil, and chemical fertilizers), are 
included in the Government Pricing Catalogue released in 2001 and, according to the Catalogue, could be subject to government prices (Table 3.14). The authorities have noted that this is not the 
case in practice, since China does not directly set the prices of reserve materials. Since reserve-
materials procurement is generally conducted through auctions, prices are the result of competitive bidding." " 
 
Question 27 Could China elaborate more the state monopoly mechanism particularly for tobacco product?  
 WT/TPR/M/300/Add.1 
 
- 297 - 
 
  
 Answer 
The monopoly mechanism for tobacco product is mainly reflected in the following aspects: through 
national legislation, define the category of monopoly tobacco commodities for cigarettes, cigars, 
cut tobacco, re-dried leaf tobacco, leaf tobacco, cigarette paper, filter rods, cigarette tow and 
tobacco, and special-purpose machinery. The state implemented monopoly and unified  
management on the production, selling, and impo rt and export business, as well as a tobacco 
monopoly license system of monopoly tobacco commodities. The State Tobacco Monopoly 
Administration is in charge of national tobacco monopoly.  Question 28 
How does China determine the government price for tobacco product?  
 Answer 
The state adopts government pricing on procurement of tobacco. Every year, the prices for procurement of tobacco are determined jointly by the NDRC and the State Tobacco Monopoly 
Administration based on average cost for produc tion of tobacco, production and supply-demand 
relationship of tobacco, and supply-demand relati onship of tobacco production in hierarchical 
organization. The prices of cigarettes are based on government pricing, i.e. the State Tobacco Monopoly Administration will determine the ex-factory price, allocation and transfer price and wholesale price 
for cigarettes. The price determination for cigarettes is based on the production cost, market 
position, and supply-demand relationship.  
Page 101, para. 3.169 
"The NDRC is in charge of implementing price controls at the central level for tobacco, edible salt, natural gas, electric power, rail and civil aviation transport, and post and telecom services. Price 
controls on health-related services and passenger transport by road are im plemented by provincial 
governments. Additionally, minimum procurement prices for rice and wheat remain in place for main grain-producing areas (seven provinces for rice, and six provinces for wheat)."   
Questions 29, 30 and 31 
Could China inform if there is other authority that is in charge of implementing price controls at the central level?  
Could China give information on the rationale behind the delegation of price control to the 
provincial governments?  Are the provincial governments only authorized to implement price controls limited to only two 
sectors (i.e.: health-related services and passenger transport) or also authorized to control the 
minimum procurement prices?   Answers to Questions from 29 to 30 
Article 5 of the Price Law specified that "a competent department under the State Council is responsible for national pricing work, while other relevant departments under the State Council are responsible for relevant work on pricing within their own scope of responsibilities. Local competent 
departments for pricing under the people's gove rnments above county level are responsible for 
pricing within their administrative regions, and other relevant departments under the people's governments above county level are responsible for relevant work on pricing within their own 
scope of responsibilities". 
 The central government has specified the scope, authority limits and institutional rules for government prices. Governments at provincial le vel may carry out management work on prices 
based on relevant principles according to local circumstances. 
According to current relevant policies, medical service prices of public hospitals are determined and adjusted by relevant government departments at provincial level, and according to the Price 
Law, the provincial governments may authorize municipal governments or county governments for 
determination and adjustment of specific prices. The medical service prices of non-public medical 
Institutions have been liberalized, and may be adjusted by the market. 
 WT/TPR/M/300/Add.1 
 
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 4 TRADE POLICIES BY SECTOR  
4.1 Agriculture  4.1.3 Policy Instruments  
4.1.3.1 Border Measures  
4.1.3.1.2 Measures Affecting Exports  
Page 128, para. 4.16  
"In general, exports of agricultural goods are not su bject to export taxes. There are only four tariff 
lines under HS 0506 which are subject to an export tax of 40% (Table 3.9). Exporters of agricultural products are entitled to VAT rebate at the time of exportation. However, there is no 
information regarding the rebate rates that apply to the different products, which can vary 
according to the product, nor regarding the pr oducts that are exempt from the rebate. The 
authorities indicated that the rate of rebate is in general 5% with some exceptions. For instance, 
the rate of rebate for highly processed chicken and duck meats is 13% and there is no rebate for 
products from endangered animals or plants."   
Question 32, 33 and 34 
Could China please give further information on  VAT rebate at the time of exportation?  
What is formulation to determine/calculate the rebate that granted to exporters?  Are there any sectors other than Agriculture that are granted to this export rebate? if so, please 
give us detailed information.  
 Answers to Questions from 32 to 34 
In the Circular of the Ministry of Finance and the State Administration of Taxation on Policies 
Concerning Labor VAT Consumption Tax for Exports (Cai Sui 〔2012〕No. 39), which has been 
issued, there are contents relevant to current main policies in export tax rebate and formula for 
tax rebates. The foreigners may obtain relevant in formation by consultation on relevant websites. 
At present, there are 7 grades for VAT export tax rebates in China, i.e. 17%, 16%, 15%, 13%, 
9%, 5%, and 0%. Considering that the export tax rebate lists with detailed tax numbers are built 
in the export tax rebate systems of relevant tax authorities, it is suggested that the foreigners 
should consult the website of the State Administration of Taxation.  
4 TRADE POLICIES BY SECTOR  
4.1 Agriculture 4.1.3 Policy Instruments  
4.1.3.2 Internal Measures  
4.1.3.2.1 Support Measures   Page 129, para. 4.22  
"China has made no notifications to the WTO Agriculture Committee regarding the support given to 
the agriculture sector during the period under review. China's most recent notification regarding domestic support covers the period 2005-2008.20 Several support programmes covering the 
period 2005 to 2008 were notified by China under the SCM Agreement."  
 Question 35 
Could China please provide information on its intention to submit a notification on regulation 
regarding the support given to the agricult ure sector during period under review?  
 Answer 
China will accelerate the work and will provide notification to the WTO when ready. Due to huge 
amount of data and the involvement of various agencies, we need more time considering we are a developing country with limited resources. 
 WT/TPR/M/300/Add.1 
 
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 Page 129, Table. 4.5  
 
Descriptions Starting 
year Form of 
subsidy Legal background 
Preferential tax policies 
for enterprises engaged 
in projects of preliminary processing of 
agricultural, forestry, 
animal, and fisheries products  2008
 Preferential 
tax 
treatment  Law of the People's Republic of China on 
Enterprise Income Tax (2007)  
Regulations for the Implementation of the 
Law of the People's Republic of China on 
Enterprise Income Tax (2007)  
MOF Circular Cai Shui No. 149 of 2008  
 
Question 36 Indonesia seeks more information on preferenti al tax treatment for enterprises engaged in 
projects of preliminary processing of fisheries products?  
 Answer 
According to the Enterprise Income Tax Law and relevant regulations for the implementation, for income of an enterprise from projects of pr eliminary processing of fisheries products, the 
enterprise income tax may be exempted.  
Page 130, para. 4.23 
"Budgetary transfers to producers have continued to  increase in China. Direct payment to farmers 
producing grains (rice, wheat and corn), introduced in 2004, are still in place. They are paid at a 
flat rate per unit of land planted. The payment is provided to the person who holds the contract 
rights to the land, not to the person who cultivates  the land. In general, the rate is of RMB 10-15 
per mu (i.e. 0.06 ha) but it may vary according to locality. The programme is administered at the 
provincial level, hence the amount of the subsidies could vary; the specific arrangements and 
procedures for granting the subsidies are formulated by the local provincial governments. Central Government funding for direct payments has increased each year up to 2007, but then stabilized at RMB 15.1 billion (US$2.3 billion) per year in 2007-2012."  
 
Question 37 Indonesia seeks more information on the procedur es of budgetary transfers from the government 
to the producers? 
 Answer 
According to current relevant policies, in principle, the direct subsidies for grain farmers shall be directly paid to them according to the actual planting area, and according to relevant national policies, the grassroots agricultural and financial departments shall report the planting areas and varieties of farmer households level by level afte r registration, check, and publicity. After review 
and confirmation of agricultural and financial depart ments at city or county level, provincial level, 
and central level, the central government will allocate the fund to local financial departments from transfer payment budget. Local financial departments will directly remit to personal bank cards or 
accounts of the farmer households. 
 4 TRADE POLICIES BY SECTOR  
4.2 Services  
4.2.1 Telecommunication Services  4.2.1.2 Regulatory Regime  4.2.1.2.7 Experimental Liberalization in th e China (Shanghai) Pilot Free Trade Zone  
 
Page 135 Para. 4.46  "All but one (Internet data centre) of the eight value-added telecommunication services categories 
have been liberalized as of March 2014 in the co ntext of the China (Shanghai) Pilot Free Trade 
Zone (CSPFTZ), under the following conditions:   
  for domestic multiplayer telecommunications services, storage and forwarding business, 
call centres, internet access services and the app stores segment of information services, 
wholly foreign-owned companies are now allowed;  WT/TPR/M/300/Add.1 
 
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   for online data processing and transaction processing, the maximum foreign participation 
is raised to 55% except for the e-commerce segment (previously closed to foreign investment) where it is raised to 50%; IP and VPN business as well as information services 
other than app stores are also subject to a threshold of foreign ownership raised to 50%;  
  Companies established in the CSPFTZ will be allowed to provide their services from the FTZ 
to the entire territory of China except for Internet access services whose geographical 
scope will be limited to the CSPFTZ."  
 Question 38 Would China notify its liberalization on telecommunication services to the WTO?  
 
Answer 
China has actively fulfilled the notification obligat ion as required by the WTO, and will continue 
relevant notification work according to Ap pendix 1A of China's Accession Protocol.  
 OTHERS 
 
Trade Barrier concerning the importation of Dairy Product   "Indonesian company which produces dairy products such as pasteurized milk, UHT Milk and 
processed cheese, has experienced trade barriers in exporting to China. According to importer in 
China, the problems occurs at registration process because Indonesia is not in the exporter list to China"  
 
Question 39 What is the rationale behind the requirement to be registered in the exporter list?  
 
Answer 
Refer to the "Food Safety Law": http://www.cnca.gov.cn/ywzl/gjgnhz/jkz l/flfg/201405/t2 0140506_20064.html. 
Law of the People's Republic of China on  Import and Export Commodity Inspection: 
http://www.cnca.gov.cn/rjwzcjgb /flfg/images/2 0061016/473.pdf. 
Provisions on the Administration of Registration  of Foreign Enterprises Producing Imported Food: 
http://www.cnca.gov.cn/ywzl/gjgnhz/jkz l/flfg/201405/t2 0140506_20062.html. 
Website of CNCA concerning the Column for Re gistration of Foreign Enterprises Producing 
Imported Food: 
http://www.cnca.gov.cn/ywzl/gjgnhz/jkzl/. 
 Question 40 How is the process for the registration?  
 
Answer  
Refer to Provisions on the Administration of Registration of Foreign Enterprises Producing Imported 
Food: 
http://www.cnca.gov.cn/ywzl/gjgnhz/jkz l/flfg/201405/t2 0140506_20062.html. 
Website of CNCA concerning the Column for Re gistration of Foreign Enterprises Producing 
Imported Food": 
http://www.cnca.gov.cn/ywzl/gjgnhz/jkzl/.  Question 41 
How many days does the registration process take?  
 Answer 
Refer to the Provisions on the Administration of  Registration of Foreign Enterprises Producing 
Imported Food http://www.cnca.gov.cn/ywzl/gjgnhz/jkz l/flfg/201405/t2 0140506_20062.html. 
Website of CNCA concerning the Column for Re gistration of Foreign Enterprises Producing 
Imported Food": http://www.cnca.gov.cn/ywzl/gjgnhz/jkzl/.  WT/TPR/M/300/Add.1 
 
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 Question 42 
Are there any other products required to be regi stered in the exporter list? If so, could China 
provide detailed information on it?  
 
Answer 
Other products that need to be registered include infant formula milk, dairy products, meat, 
aquatic products, bird's nest, and etc. 
For details, refer to website of CNCA concerning the Column for Registration of Foreign Enterprises 
Producing Imported Food: http://www.cnca.gov.cn/ywzl/gjgnhz/jkzl/. 
 WT/TPR/M/300/Add.1 
 
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 ADDITIONAL QUESTIONS BY INDONESIA 
GOVERNMENT REPORT  
 
2 ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMIC POLICY DIRECTION 
2.4 Continuing to Deepen the Reform Steadfastly  2.4.2 Reform of the business registration system  
 
Page 11 Para. 2.39 112.39  On 28 December 2013, the Sixth Session of th e Standing Committee of the Twelfth National 
People's Congress adopted the resolution on  the Amendment of the Corporate Law. The 
Amendment, which came into force on 1 March 2014, revised the registered capital requirements and other business registration issues. After that, the State Council promulgated in February 2014 
the Notice on Printing and Distributing the Plan on the Reform of Registered Capital Registration 
System and correspondingly abolished or revised the administrative regulations and rules related 
to the company registered capital registration system. This reform significantly lowered the 
registered capital threshold for enterprises. With a few exceptions, the minimum registered capital 
requirements, which was RMB 30,000 yuan for a limited liability company, RMB 100,000 yuan for a one-person limited liability company and RMB 5,000,000 yuan for a joint stock limited company have been removed; no more minimum first installment of capital injection is required and no cash 
is required to be paid as capital contribution upon the incorporation of a company, and the system 
of paid-in capital is replaced by a subscribed ca pital system. A series of other specific measures 
are also adopted to facilitate the registration of enterprises so as to provide optimized business 
environment for their development.  
 Question 1 
Does the minimum registered capital requirement also apply to foreign enterprises?  
 Answer 
With respect to registered capital of foreign-invested enterprises, according to the Notice of the 
State Council on Printing and Distributing Reform Plan for Registered Capital Registration System, 
China has removed restrictions or requirement on initial contribution proportion, currency contribution proportion and contribution period of  foreign-invested enterpri ses. China has cancelled 
requirement of minimum registered capital on ente rprises except otherwise provided by laws and 
regulations on maintaining such requirement on specific industries.   
Question 2 
Is there any specific policy to protect foreign capital?  Answer 
China seriously honors its WTO commitments to provide foreign investors with a unified, fair, 
transparent and legal business environment.  
Page 11 Para. 2.40 112.40 
 Encouraged by the favorable news of the reform  of business registration system, the number of 
newly-registered private enterprises reached 2,327,300 in 2013, showing a year-on year increase 
of 30% and accounting for 93.0% of all the newly-registered enterprises. By the end of December 2013, there were in total 15.278 million enterprises nationwide, among which 12.539 million were private. The total number of private enterprises showed a year-on-year 
growth of 15.5%, and its proportion rose from 79.4% in the end of 2012 to 82.1% in the end of 
2013.   
Question 3 
Could China give us information concerning ease of doing business index/ranking and ease of starting business index/ranking for China releas ed by World Bank on periods under review?  
 
Answer 
For details, please refer to the report issued by the World Bank. WT/TPR/M/300/Add.1 
 
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 TRADE AND INVESTMENT DEVELOPMENT AND RELATED POLICIES  
Trade and Investment Development  Promoting Balanced and Sustainable De velopment of Trade and Investment  
 
Page 17 para 3.16 173.16  
Developing foreign trade and participating in international division of labor played an irreplaceable 
role in China's economic development. Since 2012, global trade continues to be in the doldrums and China faced multiple challenges, such as the rising costs of business operation and the slowdown of growth in external demand. Confronted with new situation, the Chinese Government 
has continued the efforts to enhance coordination and sustainability of foreign trade development. 
It has proactively endeavours to transform the development pattern of foreign trade, to restructure the foreign trade and to strengthen pragmatic cooperation with its trading partners, in 
order to achieve mutual benefit, and common development. 
 Question 4 
With regards to cooperation with Indonesia, Ch ina and Indonesia have signed an agreement on 
3 April 2010 in Yogyakarta in order to encourage the development of trade relations, investment, financial cooperation, infrastructure development and economic cooperation, so that the relationship becomes more balanced and mutually beneficial. In the event of a major imbalance 
between the two parties, then the surplus party is obligated to take measures to increase imports 
and provide necessary support to the main export pr oducts of the deficits through trade facilitation 
and trade promotion measures include the promotion marketing, etc.  
The trade relations between the two countries during the last five years period (2009-2013) had 
shown positive trend by 19.58%. Th e growth of export from Indonesia to China was relatively the 
same with the growth of import from China to Indonesia and the total values of Indonesia-China 
trade balance tend to increase and favourable for China. According to Indonesian Statistics, in the 
entire year of 2013 the total trade value of both countries reached US$52.4 billion, with 
Indonesia's export to China in 2013 was valued at US$22.6 billion and imports amounted US29.8 billion. 
Although China is Indonesia's number 1 trading partner for export and import, however China's 
investment in Indonesia was relatively small compared with other countries which was valued US$296.9 million. In 2013, China took 12
th position in Indonesia's FDI after Chinese Taipei (10th) 
and Hong Kong, China (11th). We have several questions as follow: 
Indonesia is willing to know how China will fulfill  the former Premier Wen Jiabaos firm commitment 
to achieve this mutual benefit and common development between both countries?  
 
Question 5 What is China's plan to increase investment in Indonesia as implementation of both leaders commitment in Yogyakarta in 2010?  
 
Question 6 Will China facilitate and promote more imports from  Indonesia, and enhance Indonesia's industrial 
capacity through, among others, opening access to China's market and increasing China's 
investment in the industrial sectors in Indonesia?  
Joint answer 
In recent years, China has committed to promoting stead and sound development of economic and 
trade relations between China and Indonesia. A ccording to China's statistics, Sino-Indonesia 
bilateral trade volume reached US$68.35 billion and Indonesia was China's fourth largest trade 
partners in the ASEAN region in 2013. Indonesia is also an important destination of overseas 
investment by Chinese enterprises. According to China's statistics, by the end of May 2013, non-financial direct investments by China in Indonesia totalled US$3.24 billion, and Indonesia was also 
China's second largest investment destination in the ASEAN region. In 2013, the Chinese 
Government and Indonesian Government signed the Five-year Plan for Sino-Indonesia Economic and Trade Cooperation and the Agreement on the Indonesia-China Comprehensive Industrial Park 
in accordance with Indonesia's medium- and long-term economic development plan and industry 
policies. China is ready to strengthen communication and coordination with Indonesia, facilitate the implementation of the Plan and the Agreemen t and further expand and deepen Sino-Indonesia 
economic and trade cooperation to realize mutual benefits and win-win results.  WT/TPR/M/300/Add.1 
 
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 The Chinese Government has always attached great importance to investment cooperation with 
Indonesia, and has actively encouraged and su pported strong Chinese enterprises to expand 
investment in Indonesia. The Chinese Government will endow enterprise with independent 
investment right by streamlining administration and delegating power to the lower levels and 
facilitate foreign investment by enterprises, an d provide guidance and information services to 
enterprise investment in Indonesia by preparing the Guide for Foreign Investment Cooperation by 
Country (Region) including Indonesia. We also hope the Indonesian Government will provide 
convenient and preferential policies for investment  by Chinese enterprises in Indonesia as well as 
specific investment project information. China w ill convey such information to interested Chinese 
enterprises via investment promotion ag encies and relevant associations.  
 
SECRETARIAT REPORT   
SUMMARY  
Page 13 Para. 31   
China applies price controls to commodities and services deemed to have a direct impact on the 
national economy and people's livelihoods. They are set both at the central and provincial levels. Price controls may take the form of "government prices", fixed prices set by the authorities, or "government-guided prices", for which a range within which prices can fluctuate, is determined. 
The determination of government prices or govern ment-guided prices varies in accordance with 
the type of product or service, based on criteria su ch as market situation, average social costs, the 
effect on the standard of living of the population , as well as on economic, regional and seasonal 
factors. Although the methodology for setting prices is the same across provinces, prices may be 
set at different levels depending on the particular province.   
Question 7 
How does China determine price for services since measuring service is considerably complex?  Which services are classified having direct impact on the national economy and people's livelihood?   
Question 8 
Does it also apply to imported service?  
Question 9 
Please clarify further the monitoring procedure fo r price control implementation particularly for 
services. 
 
Joint answer 
According to the Price Law of China, the Government may implement government pricing or government-guided prices for important public-welfare services. Government-guided prices and 
government pricing are determined by the governme nt mainly in accordance with average social 
cost and market supply and demand situation of services concerned, requirements of national 
economic and social development as well as social bearing capacity. Generally speaking, service 
prices are set by following the below procedures, including price and cost investigation, soliciting 
opinions from consumers, operators and interest ed parties, and publishing to consumers and 
operators among others.  
 
Page 12 Para. 27   China also provides industry-specific subsidies for inputs, land and technology to firms that the 
central and provincial governments perceive as strategically important or to revitalize them as the 
NDRC calls for in its National Old Industrial Base Adjustment and Renovation Plan (2013 - 2022). Under this plan, State-Owned Enterprises (SOEs) and favoured companies can purchase inputs 
below cost and directly from each other, affecting competitiveness.  
 Question 10 
Please provide information how China balance the subsidies for SOEs and the competitiveness to 
avoid discrimination against foreign operators and unfair competition?   WT/TPR/M/300/Add.1 
 
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 Answer 
As one of market economy players, SOE participat es in market completion. China has honored its 
WTO commitments to give most-favoured-nation treatment and national treatments to foreign 
operators.  
 1 ECONOMIC ENVIRONMENT  
1.1 Recent Economic Developments  
1.1.2 Fiscal policy and structural reform  1.1.2.2 Structural reform measures   
Page 21 Para. 1.25  
 The extension of bank services to farmers has also  facilitated the delivery of some direct subsidies 
related to production and the livelihood of farmers. Starting in 2012, China has offered farmers a 
number of grants via bank accounts and bank card agents, such as the new rural social pension insurance, the new rural cooperative medical system and various fiscal subsidies related to 
agriculture, farmers and rural area s for a total of RMB 551.5 billion. 
 Question 11 Please provide information on how China assures that such subsidies do not distort the bank 
services provided bank foreign suppliers.  
WTOGPA  
Answer 
Financial services to farmers belong to government procurement financial services. The WTO GPA 
explicitly excludes government procurement financia l services from the scope of opening sectors.  
 
2 TRADE AND INVESTMENT REGIME  2.5 Foreign investment regime  2.5.3 Incentives to foreign investment  
Page 50 Para. 2.74  
 Tax incentives are in place for FDIs investing in the central-western region. Processing trade in the 
central-western region is also encouraged by establishing special customs 
supervision zones or bonded supervision areas.   
Question 12 
Could China give more information regarding tax incentive policy especially in manufacturing sectors?   
Answer 
For details, please refer to the Programme 15 of China's 2005-2008 SCM notification to WTO 
(document No. is G/SCM/N/155/CHN and G/SCM/N/186/CHN). 
 
3 TRADE POLICIES AND PRACTICES BY MEASURE  3.1 Measures Directly Affecting Imports  
3.1.8 Standards and other technical requirements  
3.1.8.2 Product certification   Page 74 Para. 3.71  
 
The Product Quality Law; the Import and Export Commodity Inspection Law; the Regulations on 
Certification and Accreditation; and the Regulations on Compulsory Product Certification. 
 
Question 13 How is the system and procedure of quality certification in China?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
Please refer to the Product Quality Law; the Import and Export Commodity Inspection Law; the 
Regulations on Certification and Accreditation; and the Regulations on Compulsory Product 
Certification. For details, please refer to  website of AQSIQ (http://www.aqsiq.gov.cn/). 
 Question 14 
Is there any different treatment between local and imported products?  
 Answer 
Please refer to the Product Quality Law; the Import and Export Commodity Inspection Law; the 
Regulations on Certification and Accreditation; and the Regulations on Compulsory Product 
Certification. For details, please refer to  website of AQSIQ (http://www.aqsiq.gov.cn/). 
 
3 TRADE POLICIES AND PRACTICES BY MEASURE 
3.3 Measures Affecting Production and Trade  3.3.4 Government procurement  
 
Page 106 Para. 3.182   Under Article 10 of the Government Procurement Law, the Government is required to procure 
domestic goods, construction projects and services, subject to certain exceptions. These 
exceptions are: when the goods, projects, or se rvices required are unavailable in China or, if 
available, cannot be procured on reasonable co mmercial terms; when the goods, projects, and 
services are procured for use abroad; or when it is otherwise provided for by other laws and 
administrative regulations. The Law itself does not contain a definition of domestic goods or provisions on local content, or rules of origin, to determine whether a product is produced 
domestically. Article 8 of MOF Order No. 18 of 11 August 2004 states that the suppliers 
participating in the bids for supply of goods or services under government procurement must be domestic suppliers who supply domestic goods or services. However, foreign suppliers may 
participate in tenders and invitations to bid concerning goods and services if other laws and 
administrative regulations so prescribe. Domestic-sourcing requirements will have to be modified 
for procurement above GPA thresholds for China to join the Agreement. Although official statistics 
do not contain data on procurement by foreign suppliers or of foreign products, this appears to 
occur. In this respect, the authorities noted that  despite the "buy-domestic" provision included in 
the Government Procurement Law, the Chinese Government has been implementing a policy to facilitate the procurement of foreign products since 2007.  
 
Question 15 Please provide the scope and/or definition for ex plaining domestic goods or provisions on local 
content, or rules of origin, to determine whether a product is produced domestically? 
 
Answer 
The Ministry of Finance of the People's Republic of China is working with relevant departments to 
develop the administrative measures of domestic goods procured by the Government. Currently, 
there is no detailed definition of domestic goods.  
Question 16 
Please provide official statistics which contain data on procurement by foreign suppliers or of foreign products.  
Answer 
Currently, China has not collected independent statis tics of related data on procurement by foreign 
suppliers or of foreign products, and thus is una ble to provide relevant data at this moment.  
 WT/TPR/M/300/Add.1 
 
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 4 TRADE POLICIES BY SECTOR  
4.2 Services 4.2.1 Telecommunication services  
4.2.1.2 Regulatory regime  
4.2.1.2.7 Experimental liberalization in th e China (Shanghai) Pilot Free Trade Zone 
 
Page 135 Para. 4.46  
 All but one (Internet data centre) of the eight value-added telecommunication services categories have been liberalized as of March 2014 in the co ntext of the China (Shanghai) Pilot Free Trade 
Zone (CSPFTZ), under the following conditions:  
- for domestic multiplayer telecommunications services, storage and forwarding business, call centres, Internet access services and the apps tores segment of information services, wholly 
foreign-owned companies are now allowed;  
- for online data processing and transaction processing, the maximum foreign participation is raised to 55% except for the e-commerce segment (previously closed to foreign investment) 
where it is raised to 50%; IP and VPN business as well as information services other than 
appstores are also subject to a threshold of foreign ownership raised to 50%;  - companies established in the CSPFTZ will be allowed to provide their services from the FTZ to the entire territory of China except for Internet a ccess services whose geographical scope will be 
limited to the CSPFTZ.  
 Question 17 
Please provide information and data on how the government adopts the rules in practice 
particularly for foreign telecommunication industry?  What opportunities will it bring to both fo reign and domestic players in the market? 
 
Answer 
Foreign players will enter the Chinese market in a broader scale and find it more convenient to make investment in the CSPFTZ. 
 
Question 18 Please provide information on China's commitment in the realization of cross-border e-commerce 
as according to OECD services trade restrictiveness index is quite high particularly for restriction 
for foreign entry and barriers for competition.   
Answer 
China strictly follows its commitments to WTO, a ll qualified foreign-service providers could provide 
services for consumers within the territory of Ch ina. China did not participate in the research 
project of OECD STRI projects-services trade restrictiveness index, and thus cannot make 
comments on the conclusion of the project. 
 3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.1 Measures Directly Affecting Imports  
3.1.8 Standards and other technical requirements  3.1.8.2 Product certification  
 
Page 75 Para. 3.75  Applications for the CCC must be made to the au thorized accredited cert ification bodies (ACB) 
designated by the CNCA, each of which is authorized to provide certification for several products 
subject to the CCC. There are 13 mandatory cert ification bodies. The procedures to apply for 
compulsory certification have not changed substantially since the previous Review and are 
stipulated in the Mandatory Product Certification Regulations. In general there are five major steps 
in the CCC certification application process: (i) submission of an application and supporting materials; (ii) type-testing (a CNCA-designated test laboratory in China will test product samples); 
(iii) initial factory inspection (a CNCA-designated certification body will send representatives to 
inspect the manufacturing facilities for the product); (iv) evaluation of certification results and approval (or failure or retesting); and (v) supervision after the certificate is granted. However, each certification body may have different application procedures, according to the product's WT/TPR/M/300/Add.1 
 
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 characteristics. CCC certificates are valid for five years from the date of approval of the 
application. Applications to re new the CCC certificate should be submitted 90 days prior to the 
expiry of the certificate. 
 
Question 19 Does China accept the result testing from foreign laboratory that have been accredited from 
accreditation body which have Mutual Recognition Agreement (MRA) with APLAC/ILAC?  
 Answer 
We are in process of coordinating competent authorities for reply. 
 
OTHERS   
Social Security Law 
 On October 2010, the Government of People's Republic of China issued Social Security Law which 
obliged foreign workers that holding working visa to pay social insurance. The foreign workers 
have to pay social security amounted 10% from the monthly salary and the foreign company have to pay 33 40% from monthly premi. There are differences for the amount of social security paid by foreign workers and company in every region.  
The social security are consist of health insura nce, accident insurance, unemployment subsidy, 
pregnancy insurance and retired insurance.  
Question 20 
Does this Social Insurance Law also apply to local workers?   
Answer 
According to Article 4 of the Social Insurance Law, employing units and individuals within the 
territory of the People's Republic of China shall pay social insurance premiums in accordance with 
the law and individuals may enjoy social insurance benefits. Therefore, regardless of their 
nationality of employing units, all employees shall pay social insurance premiums in accordance 
with law.   
Question 21 
How is the implementation of this Law to local workers?   
Answer 
Currently, China's social insurance system has covered all enterprises and individuals within the 
territory of the People's Republic of China as well as self-employed entrepreneurs and flexible 
employees. For enterprise workers, enterprises and workers shall be obligated to pay social 
insurance premiums respectively in accordance with provisions on different insurances. An 
enterprise shall withhold and deduct social insu rance premiums to be paid by an employee after 
they build the labor relationship. Eligible insuranc e participants may enjoy various social insurance 
benefits in accordance with law.  
 Question 22 
How is the implementation of this Law to foreign workers?  
 Answer 
Social insurance premiums to be paid by foreign workers who work at a Chinese enterprise or unit 
are withheld or deducted by the enterprise or unit.  
 Question 23 
What is the benefit for foreign workers from this programme?  
 Answer 
According to the Social Insurance Law and the Interim Measures for the Participation in Social Insurance of Foreigners Employed in China, eligible foreigners who participate in social insurance may enjoy social insurance benefits in accordance with law.  WT/TPR/M/300/Add.1 
 
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 Question 24 
Is there any specific regulation for the utilization of this social insurance?   
Answer 
Please refer to the Several Regulations on Implementing the Social Insurance Law (Decree Renshe 
No. 13), the Interim Measures for the Advance Payment of Social Insurance Fund (Decree Renshe 
No. 15) and Circular of the Ministry of Human Resources and Social Security on Promulgating the 
Interim Measures for the Participation of Foreigners Employed in China in Social Insurance (Decree Renshe No. 16).  
Question 25 
Why is there a different amount of the soci al security between the regions in China? 
 
Answer 
China has realized overall planning of basic en dowment insurance at the provincial level, and 
overall planning of basic medical insurance, work-related injury insurance and unemployment 
insurance at the municipal level. According to  the Social Insurance Law, the basic pension 
insurance fund will be coordinated on a national basis gradually and the other social insurance funds will be coordinated on a provincial basis gr adually. The specific time frame and steps will be 
prescribed by the State Council. The proportion of  social insurance premium and social insurance 
benefit shall vary in different coordinated regions.  
 Question 26 
What is the rationale for this differences?  
 Answer 
Unbalanced economic and social development, greatly varying employees wage and amount of 
social insurance premium and varying social insurance benefits in different regions in China.   Trade Barrier concerning the importation of Mangosteen  
 
Since February 2013, import of mangosteen orig inated from Indonesia cannot be exported to 
China because level of cadmium higher than the permitted level (6.5%).  
 
Question 27 What is the rationale of determining 6.5%  as the permitted content of cadmium?  
 
Question 28 Please give us information how many countries had fulfilled the level of cadmium on mangosteen?   
Joint answer 
Since 2012, the Chinese inspection and quarantine agencies have detected pests and over content 
of cadmium in mangosteen imported from Indo nesia, including quarantine pests Planococcus 
lilacius, Paraputohispidus and Dysmicoccus lepelle yii that are banned by China for entry. The 
General Administration of Quality Supervision, Inspection and Quarantine of the People's Republic of China (AQSIQ) timely made notification to Indonesia and urged it to adopt improvement 
measure, but in vain. China frequently has detected pests and out-of-limit heavy metals in 
mangosteen imported from Indonesia. As a result, the AQSIQ decided to suspend import of mangosteen from Indonesia. China develops the permitted level of cadmium pursuant to its national standard GB2762-2005.  
 WT/TPR/M/300/Add.1 
 
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 Trade Barrier concerning the importation of Bird nest 
 China has prohibited export of bird nest from In donesia because over contents of nitrite. This 
prohibition has started since 2010. On 2014, the competent authority of China has been conducted 
on site verification. However Indonesia has not been inform of the result of that verification.   
Question 29 
Could China provide the result of onsite verification?   Answer 
China dispatched a delegation to conduct on site verification on sanitary control system of bird nest imported to China in Indonesia during 24-28 February 2014 at the invitation of the Indonesian Ministry of Agriculture. After the ve rification China sent the Letter on the On-Site 
Verification on Sanitary Control System of Bird Nest Imported to China in Indonesia (Zhi Jian Shi 
Wai Han [2014] No.249) to the Indonesia Embassy in China on 21 March, and copied the letter to the Indonesian Ministry of Agriculture by email to  feed back the on-site verification information, 
point out existing problems in Indonesia's bird nest sanitary control system and propose 
rectification suggestions as well as materials to be supplemented by Indonesia. Afterwards, China 
urged by email, telephone and other ways In donesia many times to provide rectification 
information and supplementary materials required by China, and confirm the sanitary certificate 
and certificate of origin at an early date. To date , China has received no formal written reply from 
Indonesia.   
Trade Barrier concerning the importat ion of Animal Feed Ingredient  
 China has stipulated Regulation No. 118 and will be taking into force on June 2014. This regulation 
will be restrain our export of animal feed  ingredient originated from palm waste. 
 Question 30 Is this regulation already enforced? 
 
Question 31 What is the rationale of this regulation?  
 
Joint answer 
To standardize the administration of inspection  and quarantine on imported feed and feed 
additives, improve the quality safety level of impo rted feed and feed additives and protect animal 
and human health, the AQSIQ issued the Administrative Rules on the Inspection and Quarantine of Imported and Exported Feedstuffs and Feed Additives (Order No.118) in July 2009, which came into force as of 1 September 2009.  
 
Trade Barrier concerning the importation of Cosmetics   
Cosmetics export from Indonesia must go through long registration procedure which takes even up 
to 8 months. On the other hand, export of cosmetics from China to Indonesia use the ASEAN Cosmetics Directive which is shorter for the registration procedure. 8 
 
Question 32 Why does the registration procedure take a long time?  
Answer 
The statement that cosmetics export from Indonesia must go through long registration procedure 
which takes even up to 8 months is inaccurate. According to existing provisions, the time limit of 
import licensing of non-special-purpose cosmetics is 20 working days, while that of special-
purpose cosmetics is 135 working days. Some cosmetics must go through a long registration procedure mainly because some enterprises are unfamiliar with China's law and regulation 
requirements, their application materials not conforming to such requirements are returned and 
the time limit of licensing will be calculated again after supplementary materials are submitted.    WT/TPR/M/300/Add.1 
 
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 Question 33 
Could China give Indonesia equal treatment relating the export of cosmetics?   
Answer 
There are certain differences in registration of imported cosmetics between China and Indonesia 
for an important reason of different scopes of cosmetics definition. Currently, countries in the 
world have differences at varying degrees in cosmetics definition. For example, hair renewal, 
bodybuilding, beauty milk and many other products of special-purpose cosmetics going through long registration procedure are subject to drug administration in ASEAN countries including Indonesia. The time limit of import registration  of such products has stricter examination and 
approval compared with ordinary cosmetics, but more relaxed examination and approval compared 
with drugs. It cannot be simply believed that re gistration of imported cosmetics in Indonesia is 
more convenient than that in China. As a matter of fact, certain special-purpose cosmetics 
imported by China must go through stricter drug examination and approval.  WT/TPR/M/300/Add.1 
 
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 22  QUESTIONS BY PERU 
Informe de la Secretaría WT/TPR/S/300 
 
Pregunta 1 
 2. REGIMEN COMERCIAL Y DE INVERSIONES 
2.4 Acuerdos Regionales  
 El Perú desea saber en cuáles de los Acuerdos Comerciales Bilaterales de China existen provisiones relativas a Obstáculos Técnicos al Comercio (OTC) , y cuáles son las características principales de 
dichos acuerdos y sus aportes con respecto a los derechos y obligaciones existentes en el Acuerdo 
OTC de la OMC.   
Answer 
We are coordinating with relevant authorities. 
 
Pregunta 2 
 3. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 3.1 Medidas que afectan directamente a las importaciones  
3.1.1 Procedimientos y requisitos aduaneros  
 En el párrafo 3.1, China informa que la Administración General de Aduanas de la República Popular 
China publicó decretos relativos a la "armonización de los procedimientos aduaneros en todo el 
país". El Perú quisiera saber si el procedimiento aduanero para la emisión de una Declaración de Importación es igual o diferente en todo China, asimismo, si esa información se encuentra en 
idioma Ingles en Internet.  
 Answer 
All the Chinese customs unitarily implement the administrative instructions of the General 
Administration of Customs. The customs procedures of import declaration are unified on the whole, 
yet may differ as Chinese customs provide different convenient measures for customs clearance as well as the clearance procedure of other special goods (including the temporary import and export 
goods, the ATA carnet imported goods, the bonded goods, etc.). The relevant information of 
import declaration can be searched from the English version of the Decree of the General Administration of Customs of the People's Repu blic of China No.103-Provisions of the General 
Administration of Customs of the People's Republic  of China on Declaration of Import and Export 
Goods publicized in the "Legislation" column on the official website (English version) of China's Customs.  
Pregunta 3 
 3. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
3.1 Medidas que afectan directamente a las importaciones  
3.1.7 Medidas antidumping, compensatorias y de salvaguardia  
En el párrafo 3.42 del Informe de la Secretaría se indica que MOFCOM podrá reanudar una 
investigación que haya quedado suspendida o concluida si el exportador infringe el compromiso relativo a los precios, o si dicha entidad lo considera necesario por "otras razones". ¿Podría China indicar ejemplos sobre las "otras razones" que motivarían que se reanude una investigación por 
infringir el compromiso relativo a los precios? 
 
3.42. La reglamentación china autoriza al ex portador a ofrecer compromisos relativos a los 
precios o al MOFCOM a proponer dichos compromisos al exportador. Solo pueden contraerse 
compromisos relativos a los precios después de que el MOFCOM haya efectuado una determinación preliminar positiva del daño causado por el dumping y de su relación de 
causalidad. El MOFCOM debe tener en cuenta si la aceptación de un compromiso relativo a los 
precios daría lugar a la eliminación del daño determinado, así como consideraciones relativas al interés público, la supervisión efectiva y la posibilidad de elusión. Si se acepta el compromiso WT/TPR/M/300/Add.1 
 
- 313 - 
 
  
 relativo a los precios, el MOFCOM puede suspender o poner fin a la investigación antidumping. 
Sin embargo, una investigación que haya quedado suspendida o concluida puede reanudarse si el exportador infringe el compromiso relativo a los precios, o si el MOFCOM lo considera 
necesario por otras razones. 
 Answer 
The term "other reasons" is aimed to cover the situations that have not yet happened up to now but may happen in the future. China has not yet applied the provision to any case so far.  Pregunta 4 
 
3. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 3.1 Medidas que afectan directamente a las importaciones  
3.1.7 Medidas antidumping, compensatorias y de salvaguardia 
 En el párrafo 3.46 del Informe de la Secretaría  se indica que el artículo 56 del Reglamento 
Antidumping permite a las autoridades a adoptar las medidas correspondientes cuando un 
interlocutor comercial impone "de manera discriminatoria" medidas antidumping a exportaciones de China pero que, sin embargo, las autoridades chinas habrían reiterado durante el presente examen que China no ha aplicado el artículo  56 y que, antes de adoptar las medidas 
correspondientes con respecto a un Miembro de la OMC, China recurriría a las disposiciones 
pertinentes de la OMC en materia de sobre solución de diferencias. ¿Podría China indicar cuáles son las disposiciones relevantes que se observa para aplicar el artículo 56 antes mencionado y si el 
mismo necesariamente se aplica luego de culminado un procedimiento de solución de diferencias 
de la OMC? ¿Qué criterios considera China para determinar que la imposición de una medida antidumping a exportaciones de China es "de manera discriminatoria" tomando en cuenta que las 
medidas antidumping son por naturaleza discriminatorias (se aplican a las importaciones 
procedentes de una determinada fuente, es decir, únicamente a productos de empresas respecto de las cuales se haya constatado que practican dumping)?   
3.46. En virtud del artículo 56 del Reglamento Antidumping, las autoridades pueden adoptar 
las medidas correspondientes cuando un interlocutor comercial impone "de manera discriminatoria" medidas antidumping a exportacio nes de China. Sin embargo, las autoridades 
han reiterado durante el presente examen que China no ha aplicado el artículo 56 y que, antes 
de adoptar las medidas correspondientes con respecto a un Miembro de la OMC, China recurriría a las disposiciones pertinentes de la OMC en materia de solución de diferencias.  
 
Answer 
Now no relevant information on the implementation of such provision can be provided as China has not applied such provision to any case so far. 
 
Pregunta 5  
3. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
3.1 Medidas que afectan directamente a las importaciones  3.1.8) Normas y otras prescripciones técnicas 
 
Párrafo 3.69 ¿En qué consiste el procedimiento de examen para los reglamentos técnicos?   Pregunta 6 
 
3. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 3.1 Medidas que afectan directamente a las importaciones  
3.1.8 Normas y otras prescripciones técnicas 
 Párrafo 3.70 ¿Posee China un mecanismo para la publicación de respuestas a los comentarios 
recibidos de los miembros de la OMC o de las empresas extranjeras a los proyectos de 
reglamentos técnicos o procedimientos de evaluación de la conformidad?  WT/TPR/M/300/Add.1 
 
- 314 - 
 
  
 Answer 
We will discuss with other WTO Members and make public the mechanism of reply to such 
comments. 
 
Pregunta 7  
3. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
3.1 Medidas que afectan directamente a las importaciones  3.1.8 Normas y otras prescripciones técnicas  
Párrafo 3.71. ¿Cuál es el enfoque usado por China para el aseguramiento de que los resultados de 
evaluación de la conformidad estén de acuerdo a los reglamentos técnicos? ¿Esta supervisión se realiza en aduanas o en el mercado interno? 
 
Answer 
Under the market economy, relevant authorities of WTO Members all establish and implement 
conformity assessment procedures, such as the CE in  EU for the protection of national security, of 
deceptive practices, of human, an imal or plant life or health, of the environment. China's CCC 
system also establishes and implements for the same purposes, in conformity with relevant Chinese laws and regulations including "Product quality law", "Import and Export Commodity 
Inspection Law", "Standardization law" and "Regul ations on Certification and Accreditation", and 
follows relevant internationally accepted practice.  
Pregunta 8 
 3. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
3.1 Medidas que afectan directamente a las importaciones  
3.1.8 Normas y otras prescripciones técnicas  Párrafo 3.72. ¿Cuál es el mecanismo usado para determinar una certificación voluntaria? 
 
Answer 
Since 1990s, China started voluntary product certification work in several industries involving 
energy resources, traffic, railway, agriculture,  mechanic electronic, environmental protection, 
carbon emission, etc., including several evaluation systems such as energy saving, environmental protection, renewable energy, safety and quality. Under the framework of CNCA (the Certification 
and Accreditation Administration of the People's Republic of China) unified management and joint 
implementation, the voluntary product certification work has made great progress, and played an important role in guiding industrial developmen t, optimization and upgrading, improving the 
management level and product quality of enterprises, saving energy as well as protecting 
environment. 
 The voluntary product certification is applied by enterprises of their own free will, and carried on 
mainly in accordance with the mandatory, recomme nded and directive national standard, industry 
standard as well as technical specification for ce rtification. The certification agencies and the 
implementation process shall comply with the re quirements of Regulations on Certification and 
Accreditation of the People's Republic of China. 
 Pregunta 9  
3. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
3.1 Medidas que afectan directamente a las importaciones  3.1.8 Normas y otras prescripciones técnicas  
 
Párrafo 3.75 ¿Qué ocurre si no hay un organismo acreditado autorizado por la Administración Nacional de Certificación y Acreditación de China (CNCA) para un producto sujeto a la Certificación 
Obligatoria para China?  
 WT/TPR/M/300/Add.1 
 
- 315 - 
 
  
 Answer 
Up to now China has appointed 13 designated certification organizations to engage in CCC 
certification business. 
 
Pregunta 10  
3. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
3.3 Medidas que afectan a la producción y al comercio  3.3.2 Política de competencia y controles de precios  
En el párrafo 3.136 del Informe de la Secretaría se indica que "las empresas estatales que se 
consideren de vital importancia para la economía china y para salvaguardar la seguridad nacional, o a las que se hayan conferido legalmente derech os exclusivos de producción y venta" están 
permitidas de realizar actividades en régimen de exclusividad. Podría indicar qué empresas se 
consideran de "vital importancia para la economía china", cuáles de estas empresas realizan actividades comerciales y si las mismas reciben algún tipo de ayuda por parte del Estado. 
 
Answer 
The important industries and key sectors of stat e-owned capital concentration mainly include the 
industries involving national security, major infrastructure and important mineral resources, the 
industries providing important public products and services, as well as the backbone enterprises in 
pillar industries and high tech industries. China makes no exception to the enterprises under all forms of ownership. The state-owned enterprises do  not enjoy any preferential treatment in terms 
of credit, tax or regulatory policy. 
 Pregunta 11 
 
4. POLÍTICAS COMERCIALES POR SECTORES  4.2 Servicios 4.2.1 Servicios de telecomunicaciones 
 
En el párrafo 4.43 se señala que "Al final de 2012, cuatro empresas (China Telecom, China Mobile, China Unicom, y CITIC) habían obtenido licencias para el suministro de servicios de 
telecomunicaciones básicas y 26.979 empresas licencias para el suministro de servicios de 
telecomunicaciones de valor añadido". El Perú desea conocer qué porcentaje de las 26.979 empresas que han obtenido estas licencias son de origen extranjero y cuáles son los 
procedimientos para obtener éstas licencias tanto en el caso de empresas que brinden servicios de 
telecomunicaciones básicos como aquellas que brinden servicios de telecomunicaciones de valor añadido.  
Answer 
As of 30 May 2014, 34 joint ventures that comply with the Provisions on the Administration of 
Foreign-funded Telecom Enterprises have been granted with the Operation License for Value-
added Telecom Service. 
 To operate basic telecommunication business, an application shall comply with relevant procedures 
promulgated in Article 11 of the Regulation Concer ning Telecommunication of the People's Republic 
of China (State Council Decree No. 291), such as receiving an application and making an examination decision. To operate value-added te lecommunication business, an application shall 
comply with relevant procedures promulgated in Article 14 of the Regulation Concerning 
Telecommunication of the People's Republic of China (State Council Decree No. 291), such as 
receiving an application and making an examination decision.  WT/TPR/M/300/Add.1 
 
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 Pregunta 12 
 4.2.2 Servicios financieros 
 
En el párrafo 4.68 se señala que "mediante una decisión del Consejo de Estado del 30 de marzo del 2012 se permitió a las compañías de seguros distintos de los seguros de vida de capital 
extranjero ofrecer seguros obligatorios de responsabilidad en caso de accidentes de tráfico". 
Referente a esto, el Perú desea conocer si existe algún procedimiento diferente o adicional que las empresas extranjeras, deben cumplir.  
Answer 
China Insurance Regulatory Commission makes fair  and equal review towards the applications 
from Chinese and foreign insurance companies in a ccordance with the relevant provisions of the 
Ordinance of Traffic Accident Liability Compulsory Insurance for Motor Vehicles.  
 Pregunta 13 
 
4.2.2 Servicios financieros  En el párrafo 4.79 se señala que aún se requiere que las instituciones extranjeras obtengan la 
aprobación de la China Securities Regulatory Commission (CSRC) para convertirse en Qualified 
Foreign Institutional Investors (QFFIs) y solicitar cuotas de inversión a la State Administration of Foreign Exchange (SAFE) . El Perú desea conocer, en mayor detalle, los requisitos para obtener la 
aprobación del CSRC, así como el tiempo aproximado que demora este proceso.  
 Pregunta 14 
 
4.2.3 Servicios de arquitec tura y de construcción  
 En el párrafo 4.85 se señala que "el mercado de servicios de arquitectura de China es, sin duda, 
uno de los mayores y más prometedores por lo que respecta al crecimiento futuro. Numerosos 
estudios de arquitectura extranjeros están presentes en China". Al respecto, el Perú desea conocer cuál es el porcentaje de firmas extr anjeras de servicios de arquitectura. 
 
Answer 
According to China Statistical Yearbook 2013, in 2012 there have been altogether 75,280 
construction enterprises in China, among which 295 are foreign invested, and 385 are invested by 
Hong Kong, Macau and Taiwan investors.  Pregunta 15 
 
4.2.3 Servicios de arquitec tura y de construcción 
 
En el párrafo 4.88 se señala que "por lo que se refiere a la política de reconocimiento, los 
arquitectos extranjeros podrán participar en el  examen uniforme nacional para convertirse en 
arquitectos colegiados en las mismas condiciones que los nacionales chinos siempre que se haya 
firmado un acuerdo de reconocimiento mutuo con sus países de origen". Hasta ahora, China no ha 
firmado ningún acuerdo de este tipo. Al respecto, el Perú desea conocer si China tiene planes de firmar algún acuerdo de este tipo.  
Answer 
China has so far explored and studied mutually-recognized architect qualification with several 
countries such as Singapore and New Zealand. 
 WT/TPR/M/300/Add.1 
 
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 Pregunta 16 
 4.2.4 Enseñanza 
 
En el párrafo 4.97 se señala que "las instituciones regulares de enseñanza secundaria de ciclo superior se encuentran calificadas en la categoría de servicios "restringidos". Al respecto, el Perú 
desea conocer qué significa "categoría de servicios restringidos". 
 Answer 
According to the Provisions on Guiding the Orientation of Foreign Investment (State Council 
Decree [2002] No.346), a project in any of the follo wing situations shall be a restricted project 
with foreign investment: 1) Being of technology lagged behind; 
2) Being adverse to saving resources and improving environment; 
3) Engaged in the prospecting and exploitation of the specific type of mineral resources to which 
the State applies protective exploitation; 
4) Falling into the industries that the State opens step by step; 
5) Other situations as provided by laws and administrative regulations.  Informe de la República Popular China: WT/TPR/G/300  
 
Pregunta 17  
3. DESARROLLO DEL COMERCIO Y LA INVERSIÓN Y POLÍTICAS CONEXAS 
3.2 Promoción de un desarrollo equilibrado y sostenible del comercio y la inversión 
3.2.3 Mejora de la facilitación del Comercio  
 
En el párrafo 3.29  se señala que "se ha seguido fomentando la facilitación de los procedimientos 
en frontera, como los servicios aduaneros y la insp ección de la calidad. La Administración Estatal 
General de Supervisión de la Calidad, Inspección y Cuarentena de China y la Administración 
General de Aduanas ajustaron el Catálogo de entradas y salidas de productor básico sujetos a 
inspección y cuarentena".   
Asimismo, en el párrafo 3.30  se señala que "China ha reforzado la reforma del despacho 
interregional y desde el 1° de noviembre de 2013, lo ha hecho en las oficinas de aduanas de todo el país. El modelo de despacho de 'declaración y levante en oficinas de aduanas registradas' se 
aplicará a las empresas de la categoría AA, lo que significa que esas empresas podrán acudir a las 
autoridades aduaneras de la localidad en la que estén registradas para la declaración y el levante de las exportaciones/importaciones. En el caso de los fabricantes de categoría B que reúnan determinadas condiciones, se aplicará gradualmente el modelo de despacho de 'declaración en 
oficinas de aduanas registradas y levante en puerto'. Al mismo tiempo China ha acelerado la 
aplicación del despacho de aduanas sin documentación impresa. Esas medidas mejorarán la eficiencia del despacho de aduanas y potenciarán la facilitación del comercio". 
 
En relación a los párrafos mencionados, el Perú agradecería conocer: 
 
a)  Respecto a los procedimientos de frontera, agradeceríamos nos precisen cuáles son los 
criterios para calificar a las empresas Grado AA o a los fabricantes Grado B y si estos criterios tienen alguna relación con el Modelo SAFE propuesto por la OMA.  
 
Answer 
The General Administration of Customs classifies all registered enterprises into five categories, 
namely, AA, A, B, C and D in a descending order for their law observance and credit, based on 
enterprises' observance with laws, administration  regulations, customs provisions and rules for 
corruption, their operation status, customs supervisio n, statistics record, etc. The category will be 
changed according to the status quo of one co mpany. AA companies are the AEO of China and 
enjoy the most preferential and convenient clea rance measures. Companies of A category are of 
sound credit and are candidates for AEO compan ies. They exclusively can apply to be AA 
companies and are eligible for the convenient clea rance measure. Companies in the B category are 
general ones, to which the conventional cu stoms management measures are applicable. WT/TPR/M/300/Add.1 
 
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 Companies of C and D categories are of low credit  and are correspondingly under strict supervision 
by the customs.  
b)  En relación al tema sobre procedimientos de frontera y particularmente al modelo de 
despacho, agradeceríamos precisar si su aplicación es a nivel nacional y si se puede obtener información en inglés a través de la Web.  
 
Answer 
Please refer to the website of the General Administration of Customs. 
 
c)  En relación al despacho de aduanas sin documentación impresa, se apreciaría indicar 
cuáles son los pasos que viene siguiendo China para acelerar su implementación y cuáles son las autoridades competentes involucradas, además de la aduana nacional.  
 
Answer 
Paperless clearance operations refer to that enterprises only need to declare electronic data of 
relevant documents to the customs without submitting paper documents on the spot when going 
through import and export customs clearance forma lities. As of Aug. 1, 2012, some customs have 
initiated the reform pilot programs of paperless clearance operation. On the basis of summary of previous pilot experience, as of April 1, 2014, th e General Administration of Customs decided that 
the reform measures and pilot program scope of paperless customs clearance were extended to all 
business sites and areas of the customs throughout the country, gradually achieving full coverage of paperless clearance reform. According to statistics, 230,000 enterprises participated in the 
paperless customs clearance in the first quarter of 2014.  
Several ministries and commissions such as the Ministry of Commerce, the State Administration of Taxation, the Quality Inspection Administration, the State Administration of Foreign Exchange 
and the Ministry of Agriculture have participated  in the customs' reform of paperless clearance 
operation in terms of paperless internet linked inspection over superintendency certificate and license. WT/TPR/M/300/Add.1 
 
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 23  QUESTIONS BY INDIA 
Secretariat Report, para 2.20, page 38 
 
The Secretariat refers to the Third Plenary Sessi on of the 18thNational Congress of the Communist 
Party of China (CPC) held in November 2013, which approved a Decision on Major Issues concerning Comprehensively Deepening Reforms. An  important aspect of this Decision has been 
pointed out to be the reform of State Owned Enterprises (SOEs). 
 Question 1 Could China elaborate the specific aspects in wh ich the reform of State Owned Enterprises is 
envisaged and the way in which it proposes to go ahead with the reform programme? Moreover, in 
the light of the goal for constructing a united and open market system with encouragement for 
private ownership, what is the role that SO Es would play in the changed environment?  
 
Answer 
The following three principles shall be follo wed in deepening the reform of state-owned 
enterprises. First, stick to the fundamental ec onomic regime; second, stick to market reform; 
third, stick to separation of government and enterprise, administration and capital, ownership and operation right. The Decision made by the third plenary session of the 18 CPC meeting clearly identifies the decisive role of market in distributing resource, and put forward a series of key 
measures in reforming the state-owned enterprises. The key is on two focal points for the time 
being and future. First, deepen the reform of st ate-owned enterprise, actively develop economy of 
mixed ownership; second, deepen the reform of management system of state-owned enterprise, 
improve modern corporate system. The state-owned en terprise is owned by all, it is the driving 
force for promoting modernization and ensuring people's common interest. The state-owned enterprise is generally integrated with market economy. It must meet market demand and 
international condition to manage their operation efficiency according to regulations, so as to 
enhance its vitality and undertake social responsibility, and further deep the reform of the state-owned enterprise.   
Secretariat Report, para 3.13, page 58 
 The Secretariat refers to China's practice of imposing interim tariff rates over and above MFN 
rates, agreement tariff rates, special preferential tariff rates, general tariff rates and tariff rates 
quota rates. It is understood that these interim tariff rates on imports are usually lower than the MFN rates and higher than the MFN rates for exports. Applied for a specific period of time-usually 
one year, the interim rates are actually the applied rates for that year.  
 Question 2 In the light of the above, India would like to know the objectives of imposing interim tariff rates on 
an annual basis as well as the extent of tariff lines being subject to such tariffs over the last three 
years along with some of the important product lines on which same is imposed, especially with respect to imports. 
 
Answer 
Please refer to the Customs Tariff of Import and Export of the People's Republic of China of each 
year to learn about the annual interim tax rate in China. Regarding the simplification of customs 
tariff structure, tariff reform and the review of ex port tariff, the Chinese government will adjust the 
import and export tariff rate according to national economic development and the actual production, consumption and import and export. 
 
Secretariat Report, Tables A1.1 and A1.2, page 163 and 164  
Reference is made to both exports and imports under processing trade in the two tables. 
 Question 3 
India seeks to understand the details of the conc ept of processing trade as understood by the 
Chinese Customs authorities and the mechanism of capturing data under the same.   WT/TPR/M/300/Add.1 
 
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 Answer 
According to the Regulations on Managing Goods of  Processing Trade, processing trade refer to 
operations where enterprises import complete or part of raw materials, accessories, spare parts, 
components and packaging materials for processing and assembly and export the finished 
products. It includes processing materials supplied by foreign enterprises and processing imported materials. 
 
According to the Regulations on Statistics of Customs (Customs No. 153), the Customs carry out 
statistic based on super pooling. For goods trade that complies with statistics arrangement, and for import-export declaration record with assemb ly trade featuring foreign-supplied material 
processing (type code 14) and trade of imported-material process (type code 15) on the customs 
declaration, they are directly calculated to become import-export date of processing trade.  
Secretariat Report, para 6, page 96 
 "In 2013, manufactured products remained the dominant component of China's exports, 
accounting for 94% of the total". 
 Question 4 Could China provide an assessment of the proportion  of imported content in its exports over the 
past 3-4 years?  
 Answer 
The Customs has no statistics on the import-export component ratio of export goods. The General Administration of Customs pays great attention to the position of Chinese goods in global value chain. It works with MOFCOM, NBS and SAFE on the key research task of study on benefit relation 
between global value chain and global trade. Acco rding to the Research Report on Global Value 
China and Value-added Accounting of China's Trad e, the added value of China's export has the 
following features: first, the added value of unit export is relatively low. In 2010, there is only 615 USD in added value for each 1,000 USD export; second, export of processing trade has less 
boost on added value compared with normal tr ade export; third, in 2011, the added value of 
China's unit export is relatively improved comp ared with 2010; forth, out of the three major 
industries of the economy, the domestic added value of agricultural unit export is the highest, 
followed by service industry, the export of second ary industry has relatively lower domestic added 
value; fifth, in industry sector, the export of traditional labor-intensive and resource-intensive 
sector contribute relatively higher domestic adde d value, while the export of technology-intensive 
sector has relatively lower domestic added value. 
 Secretariat Report, para 20, page 12  
"However, the average length of th e application of measures increased to slightly over six years," 
 Question 5 
Could China state the proportion of anti-dumping measures that were in place for more than 
5 years on 31 December 2013?  
Answer 
Please refer to the notification on anti-d umping measures for the first half of 2013. 
 Secretariat Report, para 1.19, page 19 
 
"As part of the process of structural reform, China continues to promote private participation in the economy. The authorities have noted in the contex t of the present Review that in the past three 
years, the number of private enterprises and individual industrial and commercial households has 
been steadily growing; the amount of their regi stered capital has been rapidly rising; and the 
average registered capital per enterprise or household has been increasing." 
 
Question 6 China is requested to clarify the existence of private standards which has emerged with the growing influence of private sector. WT/TPR/M/300/Add.1 
 
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 Answer 
There are four kinds of standards in China: nati onal, industry/sectoral, local, and enterprise 
standards. National standards are developed for ad option at the national level. Industry/sectoral 
standards are developed when there are no nati onal standards, but compliance with specific 
conditions is required in a professional field at the national level. Local standards may be developed where neither national nor industry/sectoral standards exist. However, once equivalent 
national standards are developed, these replace local and industry/sectoral standards. Similarly, 
enterprise standards may be developed for an ente rprise when national, industry/sectoral or local 
standards are not available.  
Globally it has been observed that as the private participation increase in the economy it has led to 
the creation of private standards. In this contex t, India would like to know the following details: 
 
Question 7 
How effective has been the compliance with the WTO provisions under the TBT/SPS Agreements?  
Question 8 
What steps are outlined by China in order to discipline such standards - which in some sense fall outside the purview of harmonized standards?  
Question 9 
Does the list of sectors in which these private standards exist?  
Answer 
Please give the definition of private standard. 
 
Question 10 
What steps have the Chinese authority taken to verify the process and procedures of SPS/TBT agreements are being followed by and thereby to keep a check on spurt of such standard?  
Answer 
The Standardization Administration of China (SAC),  under AQSIQ, continues to be the agency that 
centralizes the administration of the standardizatio n system in China. The SAC is assisted by the 
National Development and Reform Commission (NDRC), the State Food and Drug Administration, 
the China Association of Standards (CAS), a number of ministries, and local and industry standardization associations. In addition, the AQSIQ ensures that both imports and exports comply 
with technical regulations and certification requirements. There are other organizations such as the 
China Association of Standards (CAS) and non-governmental organizations affiliated to AQSIQ that support SAC and other institutions in the development of standards through research and international cooperation to promote the use of best international practices in the development of 
China's standards so that they comply when possi ble with existing international standards. These 
institutions also disseminate the proper use and application of standards. National standards are formulated by SAC, through an eight-step process: feasibility study, 
research, project design, drafting of proposed standard, comments, examination, approval and 
publication. National standards are reviewed af ter five years of implementation and might be 
amended or annulled as required. Industry/sectoral standards are formulated by the 
standardization administrations of the competent ministries, with the support of the industry 
institutes of standardization and technical committees. National and industry/sectoral standards must be published in the Standard Press of China,  and filed and stored at the National Library of 
Standards. Local standards are formulated by departments of standardization authorities of 
provinces, autonomous regions and municipalities directly under the Central Government in 
accordance with the Administrative Measures on Local Standards.  
Question 11 
India seeks to understand the processes put in pl ace by China to check the infringements of the 
WTO rules like: harmonisation and minimum/least trade distorting etc.? 
 WT/TPR/M/300/Add.1 
 
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 Answer 
China is willing to work with other member countries on discussing how to enhance WTO/TBT and 
SPS discipline to promote sound development of private standards and reduce its negative impact 
on global trade to the minimum. 
 Secretariat Report, para 1.16, page 18 
 
"The pilot programme of replacing business tax with value-added tax has been rolled out." 
 Question 12 
Could China provide details of the main points of difference between business tax and value-added 
tax? Further, could China also indicate the year by when the roll out of value-added tax would be completed? 
 
Answer 
For VAT and business tax in China, the existing VA T is levied on the added value of goods. It is 
permitted to deduct the VAT on purchased goods (including fixed assets), and the rate is relatively 
higher (17% standard rate); the existing business tax is mainly for levied in full for business revenue. It is not permitted to deduct the VAT of purchased goods and services, and the rate is relatively lower (3%-5% generally). VAT is le vied for the added value. This arrangement 
contributes to better social labor division and coordination and promotes professional enterprise. 
Business tax is levied for all the transaction throughout the circulation. There is repetitive levy in the process and is not conducive to fostering professional enterprise. Given the negative impact of 
business tax, China started pilot project of repl acing business tax with VAT since January 1, 2012, 
with the purpose of completely reforming business tax to VAT within the 12
th five-year period, and 
eliminating business tax system. 
 
Secretariat Report, para 3.66, page 73  "There are four kinds of standards in China: national, industry/sectoral, local, and enterprise 
standards. National standards are developed for adoption at the national level. Industry/sectoral 
standards are developed when there are no national standards, but compliance with specific conditions is required in a professional field at the national level. Local standards may be 
developed where neither national nor industry/secto ral standards exist. However, once equivalent 
national standards are developed, these replace lo cal and industry/sectoral standards. Similarly, 
enterprise standards may be developed for an ente rprise when national, industry/sectoral or local 
standards are not available." 
 Question 13 China is requested to provide insights into the process of checks and balances adopted (to meet 
the WTO obligations) in the process of voluntary and mandatory standards that are being created 
at industry/sectoral, local and enterprise standards.13/  
Answer 
According to the Standardization Law, the sectoral  standard authority shall follow its responsibility 
and report to the administrative authorities of the State Council about the scope for drafting a 
standard and apply for sectoral standard code to avoid standard overlapping. While drafting 
standard plan, it shall seek openly seek comments from all sides. The standard shall be submitted to the standardization authority under the State Counc il for filing after the publication. If the filed 
standard overlaps, repeats or contradicts with national standard, the standardization authority 
under the State Council shall demand the sectoral standard authority concerned to correct or stop 
the implementation within a limited time.  
Question 14 
China is also requested to clarify the nature of enterprise standards?   
Answer 
Enterprise standard is the standard that ha rmonizes technical requirements, management 
requirements and working requirements within enterprises. When no national or local standard exists, enterprise standard shall be formulated an d followed in production. When national, trade or WT/TPR/M/300/Add.1 
 
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 local standards already exist, enterprises are encouraged to formulate and apply higher enterprise 
standards.  
Question 15 
Enterprise standards are the same as private standards or they different terminologies?15  
Answer 
Here are four kinds of standards in China: national, industry/sectoral, local, and enterprise 
standards. And we request the Indian government  to give the detailed definition of private 
standard. 
 
Question 16 How can China justify the use of such standards when any deviation from the internationally 
harmonised standard is bound to restrictive on trade and the free movement of goods?16 
 Answer 
We request the Indian government to clarify what such standards refer to? And if it refers to private standard, please give the detailed definition of private standard.  Question 17 
Overall, how does China ensure that emerging standards from these processes do not infringe with 
the MFN and NT principles of the SPS and TBT Agreements?  
Answer 
Since its WTO accession, the Standardization Administration carefully fulfill the commitment and 
follow WTO requirement. In terms of standard, the Administration grant a product originated from 
WTO Members the treatment that is no less than that given to similar domestic product and similar 
foreign product.   Secretariat Report-para 3.69, page 74 
 
"The procedures to develop and issue a standard and a technical regulation (also referred to in China as "mandatory" standard) are similar but there are some differences. When a technical 
regulation is to be developed, it must be stipulated that it will be mandatory; the examination 
procedure is different, and the period to receive comments cannot be less than two months. A (voluntary) standard could be quoted in a te chnical regulation and thus it would become 
mandatory. "Mandatory" standards refer usually to: medicines, food, veterinary drugs, and 
pesticides; labour and transportation safety; construction; environmental emissions; and technical terms (Table 3.6). The code of a mandatory nation al standard starts with the letters "GB". The 
code of a mandatory local standard starts with "DB" and the code of the Province (e.g. Shanxi 
Province, mandatory local standard code: DB14/).2(3.6) GBDBDB14/." 
 Question 18 
China is requested to provide a detailed sector-wise list of mandatory and voluntary standards as 
provided in Table 3.6 of page 74.  
Answer 
These is national standard bulletin, mandatory national standard search, sectoral standard filing 
bulletin and local standard filing bulletin on the Standardization Administration website http://www.sac.gov.cn. 
 
Question 19 India would like the detailed information, in the following format: 
i.  India would request for detailed information on all the sectors like medicines, food, 
veterinary drugs, and pesticides; labour and transportation safety; construction; environmental emission; etc.  
ii.  The information may be provided as given under the Table 3.6 retaining the break-up of 
national, sectoral and local standards and may be segregated additionally on mandatory and voluntary standards also.  WT/TPR/M/300/Add.1 
 
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 China is requested to provide complete information on all the existing standards. 
 Answer 
Please refer to the website of the Standardization Administration and other related ministries for information on standards.  
Secretariat Report, para 3.78, page 77 
 "Another salient feature of China's SPS system is the fragmentation of regulatory authorities among different Government agencies. Currently th e Ministry of Health (MOH), the Ministry of 
Agriculture (MOA), AQSIQ, the State Administrati on for Industry and Commerce (SAIC), MOFCOM, 
and the State Food and Drug Administration (SFDA) are actively involved in regulating the SPS regime (Table 3.8). This fragmentation of the SPS regulatory system presents a challenge 
regarding the enforcement and implementation of policies and specific measures as there could be 
an overlap of functions and thus an avoidance of responsibility and lack of accountability. 
 
Question 20 
China is requested to clarify on the discrepancies found by India in the Table 3.8 on fragmentation 
of regulatory authorities. In order to highlight the same the Table 1 is provided - which is based on SPS Database of Cent re for WTO Studies. 
Table 1: SPS notifications and the ag ency responsible: 2002 to March 2014  
Agency listed in the notifications 
 SPS notifications 
(2002 to March 2014)  
Certification and Accreditation Administration of the People's Republic of China 
(CNCA) 1 
General Administration of Quality Supervision, Inspec tion and Quarantine of 
the People's Republic of China (AQSIQ) 24 
Ministry of Health, General Administrati on of Quality Supervision, Inspection 
and Quarantine (AQSIQ) 493 
National Health and Family Planning Commission 44 
Standardization Administration of the People's Republic of China (SAC) 10 
State Forestry Administra tion P.R.C, Ministry of Agriculture, General 
Administration of Quality Supervision,  Inspection and Qu arantine P.R.C. 2 
No Agency Listed in the Notification 141 
Total Number of Notifications 715 
Source: Centre for WTO Studies, Web Portal on TBT and SPS databases. 
Accordingly, there are 6 agencies in the Table 1 however there are only 5 as per Table 3.8. 
China is requested to clarify? 
 Answer 
WTO does not require how many departments or agencies should be responsible for the 
implementation of SPS measures or how many Ph yto-Sanitary measures are needed. In many of 
the WTO members such as the U.S.A., SPS measures are implemented by various agencies whose measures are all related to the international trade. In China, however, AQSIQ is responsible for the 
supervision and administration of the imported and exported food, animals and plants, and their 
products; SFDA and MOA takes charge of the supervision and administration of domestic production, circulation and other links; and the health and birth planning committee helps 
formulate and revise the national standards for China's food safety. The supervision and 
administration duties are clearly sectioned among the concerning departments who work very well with one another. There is therefore, no such problem as fragmentation and/or overlapping of 
supervision and administration departments, mentioned in the Secretariat Report, paragraph 78, 
Chapter 3. 
As to the problem of discrepancy identified by India in the two tables in terms of the number of agencies, we must clarify that the number of SIX posted on the WTO website does NOT mean 
6 departments but 6 categories. We kindly inform the Indian side to review the tables more 
carefully as some of the columns may carry two de partments that serve as the informing agencies 
providing data. This is a totally different concept from the concept of supervision and 
administration. There is therefore no discrep ancy between the messages provided by our 
supervision and administration departments and that by the WTO. WT/TPR/M/300/Add.1 
 
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 Secretariat Report, para 3.78, page 77 
 "China's TBT Enquiry Point continued to be AQSIQ. The Enquiry Point was responsible for 
preparing, checking and submitting China's TBT notifications. During the period under review, 
China submitted 167 TBT notifications, most of them  (some 150) under Article 2.9. The majority of 
the technical regulations notified were applied to regulate the market and to protect human health, 
safety and the environment. In the TBT Committee concerns were raised regarding, inter alia, the 
length of time to comment and the ability of foreign companies to comment.  Question 21 
China is requested to clarify to the observations of India on the discrepancies between the in the 
information provided in paragraph 3.70 of Secret ariat text and Table 2 below. There are some 
307 notifications made by China to the WTO and ma jority of 292 notifications were made under 
Article 2.9.2 
Table 2: China's TBT notifications under Article 2 
Article 
 2010 2011 2012 2013 2014 Total TBT 
Notifications 
TBT 
2.10.1 -- -- 2 1 -- 3 
2.9.2 61 80 70 76 4 291 
2.9.2 & 5.6.2 -- -- 1 -- -- 1 
5.6.2 -- 8 -- 6 -- 14 
5.7.1 -- -- -- 2 -- 2 
Total Notifications 61 88 73 85 4 311 
Source: Centre for WTO Studies, Web Portal on TBT and SPS databases. 
China is requested to provide clarity on the issue of discrepancies observed by India. 
 
Secretariat Report-para 3.132, page 91  
"Economic growth was under downward pressure, overcapacity remaining a prominent problem". 
 Question 22 
Could China provide details of sectors in which over capacity has been identified to be a prominent 
problem?  Answer 
Steel, cement, electrolytic aluminium, sheet glass and shipbuilding industries, whose capacity is sharply under-utilized in comparison with the st andard international level, are classified as 
industries with severe over-capacity. 
 
Secretariat Report, para 4.30, page 131  
"A minimum procurement price scheme remains in place for rice and wheat in major producing 
areas. Minimum prices for grains (rice and wheat) are set every year by the National Development and Reform Commission (NDRC) in consultation with the Ministry of Agriculture and other governmental institutions. During 2007-12, the minimum prices for rice and wheat were increased 
each year on the basis of the growing costs of ag ricultural production. If the "market" price goes 
below the established support level, the Government, through the state-owned Company Sinograin, purchases grain." 
 
Question 23 China implements minimum support price policy for agriculture sector. Government announce 
minimum support price for some crops. It is requested to clarify, whether total production of a 
particular crop is eligible for procurement or government sets a target for the procurement. How this policy is treated in WTOs notification on domestic support?  WT/TPR/M/300/Add.1 
 
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 Answer 
The Government sets a target of procurement. Howe ver, when the market price is higher than the 
minimum price, the government does not procure any products. This policy is listed as specific 
AMS in WTO notification. 
 Secretariat Report, para 4.14, page 127 
 
The VAT on agricultural domestic and imported goods is 13%. However, agricultural goods produced and sold directly by small-scale farmers remain exempt from the VAT.13%  
Question 24 
It is requested to provide information about the definition of Small Scale Farmers. What is the criterion used to identify Small Scale Farmers.24 
 
Answer 
According to China's current tax regime, farmers se lf-produced agricultural products for sale are 
VAT free. This is not a policy that only aims at the Small Scale Farmers despite the fact that most 
Chinese farm producers are small. According to th e current policies, China's farm producers, large 
and small; all enjoy the VAT free policy.  
Secretariat Report, para 3.120, page 87 
 "As notified by China, capital is guided through preferential tax treatment to specific Regions to 
promote development in remote areas (e.g. the Central and Western Regions) and to narrow 
economic gaps amongst the different regions. Re gional development funds also exist to assist 
these areas. It appears that preferences grante d in these Regions have not changed since the 
previous Review in 2012. The Enterprise Income Tax (EIT) on enterprises (domestic and foreign-
invested) established in these Regions and engaged in industries encouraged in the Catalogue of 
Priority Industries for Foreign Investment in the Central-Western Regions are subject to a preferential EIT rate of 15% and exempted from import duties for the equipment imported to be 
used in the project (with the exception of those lis ted in the "Catalogue of imported products not 
subject to tax exemption in foreign-invested projects" or in the "Catalogue of imported products not subject to tax exemption in domestic invested projects"). However, a new Catalogue of Priority 
Industries for Foreign Investment in the Mid-Western Regions was released in 2013. This 
Catalogue (2013) lists by province the specific industries in which FDI should be encouraged."  
Question 25 
Can China provide details relating the criteria for availing such incentives?  Answer 
Between 2001 and 2010, an enterprise income tax (EIT) of 15% has been levied on those domestic and foreign-invested companies in the west region, encouraged by the government. All 
enterprises complying with the tax regulations will enjoy preference as it does not tell domestic 
from foreign. For specific information, please refer to Article 14, G/SCM/N/155 G/SCM/N/155, 
China Subsidy Notification. The preference was ex tended to the end of 2020 in order to further 
support the great development of the west regions, i.e. those government-supported enterprises 
in the west regions will enjoy the tax rate of 15% from 1 January 2011 to 31 December 32020. 
China will update the subsidy notification with this policy in its new edition.  Question 26 
Specifically, can China clarify whether any local content or export contingent requirement is 
imposed as a condition for availing these incentives?  
Answer 
No.  
 WT/TPR/M/300/Add.1 
 
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 Secretariat Report, para3.37- 3.41, page 67 
 "3.37: On the basis of its findings, MOFCOM must make and publish a preliminary determination 
on dumping and injury, as well as on whether there exists a causal link between dumping and 
injury. If a preliminary determination is affirmative, provisional anti-dumping measures may be applied, after at least 60 days from the date of publication of the decision to initiate the 
investigation. Provisional measures may take the form of provisional anti-dumping duties, or a 
request to provide deposits, bonds, or other forms of guarantees. In the latter case, the decision is 
made by MOFCOM. The decision to apply provisiona l anti-dumping duties is made by the SCTC on 
the recommendation of MOFCOM. Provisional measures may not generally be applied for more 
than four months, but may be extended to nine months in "special circumstances", this being 
understood to refer to those cases where the authorities are examining whether a duty lower than the margin of dumping would be sufficient to remove the injury to the domestic industry. 
 
3.38: MOFCOM, through the BOFT, may require th e applicant to make amendments or provide 
supplementary information regarding the application for an anti-dumping investigation within the 
period specified above, failing which it may reject the application. If the application is rejected by 
MOFCOM, it is not published; a Public Notice is issued only if MOFCOM decides to initiate an anti-dumping investigation, before which it shall notify the governments of exporting countries (regions). Non-confidential information regarding an investigation is available to the public. 
Interested parties may also apply for a public hearing regarding dumping or injury; the hearing 
may be open unless the BOFT or IBII consider that keeping information confidential warrants a different type of meeting. 
 
3.39: On the basis of its findings, MOFCOM must make and publish a preliminary determination on dumping and injury, as well as on whether there exists a causal link between dumping and injury. 
If a preliminary determination is affirmative, provisional anti-dumping measures may be applied, 
after at least 60 days from the date of publication of the decision to initiate the investigation. Provisional measures may take the form of provisional anti-dumping duties, or a request to provide deposits, bonds, or other forms of guarantees. In the latter case, the decision is made by 
MOFCOM. The decision to apply provisional anti-d umping duties is made by the SCTC on the 
recommendation of MOFCOM. Provisional measures may not generally be applied for more than four months, but may be extended to nine months in "special circumstances", this being 
understood to refer to those cases where the authorities are examining whether a duty lower than 
the margin of dumping would be sufficient to remove the injury to the domestic industry.   
3.40: Whether or not provisional measures are applied, in the case of an affirmative determination 
MOFCOM must continue the investigation and, on the basis of its findings, make a final determination which must be published. Before the final determination is made, MOFCOM must inform all known interested parties of the essential facts on which the final determination is based. 
The investigation must be completed within 12 months of the date on which the decision to initiate 
is announced, or within 18 months under special circumstances. In accordance with the anti-dumping regulations, the imposition of anti-dum ping duties must be in the public interest. 
However, there are no rules specifying how to do this and, with the exception of price 
undertakings, the issue has not been explicitly included as a factor for considering whether to impose a measure or not. 
 
3.41: The margin of dumping is determined on th e basis of a comparison of a weighted average 
normal value with a weighted average of prices of all comparable export transactions, or by a comparison of the normal value and export price on a transaction-to-transaction basis. However, if 
export prices differ significantly among purchasers, regions or time periods, a comparison may be 
made between a weighted average normal value and prices of individual export transactions. This 
method has not, however, been used so far. An ti-dumping duties may not exceed the margin of 
dumping established in a final determination. Th e anti-dumping regulations do not preclude the 
i m p o s i t i o n  o f  a  d u t y  l e s s  t h a n  t h e  m a r g i n  o f  dumping. In this respect, the authorities have 
indicated that China does not currently examine if a duty less than the margin of dumping is 
sufficient to eliminate the injury caused by dumped imports in final determinations." 
 WT/TPR/M/300/Add.1 
 
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 Question 27 
Paragraph 3.37: Can China please elaborate the role and functioning of State Council Tariff Commission (SCTC). What is the composition of the SCTC? At what stage MOFCOM informs the 
SCTC for taking a decision whether to impose An ti-dumping duty? How SCTC takes a decision and 
in general how SCTC functions? Whether SCTC examines the aspect of public interest?   
Answer 
The SCTC is a discussion and coordinating agency under the State Council. Its key responsibilities 
are: to adjust and explain the tax items, HS codes and tax rates of the Import and Export Tariff of the People's Republic of China and the Import Tax Rate Table of the People's Republic of China, 
then report to the State Council; to decide the goods applied to temporary tariff rates, the tax 
rates and the time limit; to decide the tariff-rate quotas; to decide the imposition of anti-dumping duties, anti-subsidy duties, safeguard measure tariff, retaliatory tariff and other tariff measure; to 
approve the preferential tax rates plan of releva nt countries and regions; to examine significant 
tariff policies and report them to the State Council; to decide the application of tax rate under the special situations, and fulfill other obligation stated by the State Council. 
 
At present, the director of the MOFCOM is Lou Jiwe i, the minister of the Ministry of Finance, the 
associate director is Xiao Jie, the vice executive secretary of the State Council, the committee members comes from the leadership of ten depart ments including the Ministry of Finance, State 
Development and Reform Commission, Commerce department, Ministry of Industry and 
Information, Ministry of Land and Resources, Mini stry of Agriculture, General Administration of 
Customs, State Administration of Taxation, Legislative Affairs Office. The Ministry of Finance 
undertakes the specific job of the MOFCOM, and the office is located at the tariff department of the 
Ministry of Finance.  
According to the anti-dumping regulations and the relevant rules of the Commerce Department, 
the Commerce Department should convoke a di scussion conference of the Trade Remedy 
Coordination Committee (the member of the MOFCOM is specially invited) before it make a final determination of anti-dumping. If there are issues concerning public interest in the anti-dumping 
measures, the MOFCOM will come up with relevant  advices and suggestions during the conference, 
therefore, the final determination of the Commerce Department generally takes the public interest 
into account. Based on above-mentioned work procedure, up to now, the MOFCOM has not 
rejected the suggestions from the Commerce Department and not adjusted the anti-dumping tax 
rates proposed by the Commerce Department, but it has fine-tuned the time limit of the taxation proposed by the Commerce Department. 
 
Question 28 Para 3.39 and 3.41: In para 3.41, it has been st ated that China does not currently examine if a 
duty less than the margin of dumping is sufficient to eliminate the injury caused by dumped 
imports. China may please clarify whether it practices lesser duty rule?  
 Question 29 
Elsewhere in para 3.39, it has been stated that provisional measures may be extended to 9 
months in special circumstances, where the author ities are examining where a duty lower than the 
margin of dumping would be sufficient to remove the injury to the domestic industry. China may 
clarify whether it actually practices lesser duty to permit imposition of provisional duties for a 
period of 9 months in accordance with the Article 7.4 of the Anti-dumping Agreement.   Question 30 
Para 3.40: Whether there are procedures/administrative instructions to examine public interest 
before imposition of Anti-dumping duties. If so, there may be elaborated.  
Answer 28-30 
According to the Article 37 of the anti-dumping regulations, imposition of anti-dumping duties 
should conform to public interest. During the anti-dumping investigation, investigatory apparatus 
should provide enough declaring opportunities to  all the concerned parties including involved 
producers and exporters, countries, upstream and do wnstream firms, related industry associations 
and importers through holding hearings and opinion meetings, and should seriously consider relevant appeal to ensure the case investigations objective and fair. As to the detail of the WT/TPR/M/300/Add.1 
 
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 consideration, the investigatory apparatus will exam ine according to the situations of the concrete 
cases.  
Secretariat Report-para3.102, page 83 
 "Exporters continue to be entitled to VAT rebates. Rebate rates are usually lower than the VAT 
paid. At present, rebate rates are: 17%, 16%, 15%, 13%, 9%, 5% and 0%. Certain goods are not 
eligible for a rebate. VAT rebate rates as well as the goods that are not eligible for the rebate could change as the rebate has been used as a policy instrument to encourage or discourage exports, as necessary, to meet industrial development goals. For instance, in 2009 VAT rebate rates were 
increased on exports of certain products including: iron and steel; non-ferrous metals; 
petrochemicals; electronic and information technology products; and also some light industries such as textiles and clothing; while in 2010 the VAT rebate on exports of certain products (406 
tariff lines at HS 10-digit level), such as steel, non-ferrous metals processing materials, silver 
powder, starch, and ethanol; certain pesticides, pharmaceuticals and chemical products; and certain plastic products, rubber products and glass products, was eliminated. According to the 
authorities, there have been no changes to the VAT refund rates since 2011 and the list of 
products eligible for VAT export refund and the refund rates can be viewed in the "Inquiry for 
Export Refund Rates" column on the website of the State Administration of Taxation. WTO documents G/AG/N/CHN/24, 17 December 2012; and G/AG/N/CHN/27, 7 March 2014. Products 
not subject to VAT rebate include: high-energ y-consuming products, high-polluting, and those 
related to the use of resources; and endangered species of fauna and flora (information provided 
by the Chinese authorities). Trade Monitoring Database "TMDB". Information provided by the 
Chinese authorities making reference to the Circular by MOFCOM and the Ministry of Finance, Cai 
Shui No. 57 of 22 June 2010 [in Chinese only].  Viewed at: http://www.chin abriefing.com/news/." 
 
Question 31 As per para 3.102 exporters continue to be entitled to VAT rebate and rebate rates are usually lower than the VAT paid. Can China please clarify whether in certain cases rebate rates are higher 
t h a n  t h e  V A T  p a i d ?  W h a t  i s  s y s t e m  o f  r e f u n d  o f  V A T  p a i d  o n  e x p o r t s ?  O n  t h e  b a s i s  o f  w h i c h  
documents VAT rebate are allowed and at what stage?  
Answer 
At present, China's VAT export rebate rates are divided into 17%, 16%, 15%, 13%, 9%, 5% and 
0% seven level. Rebate rates are lower than the statutory VAT paid in any circumstance. 
The main basis of the VAT export rebate is the arti cle 2 item 3 of the Provisional Regulations of the 
People's Republic of China Value Added Tax which stipulated that for tax payers exporting good, the tax rate shall be 0%, except as otherwise stipulated by the State Council , and the Notice of the Ministry of Finance and the State Administration of Taxation on the value added tax of export 
goods and services and consumption tax policy (Cai Shui [2012] No. 39).Accordingly, the 
enterprises exporting goods enjoy the exemption from the VAT, at the same time, the corresponding input VAT offset the payable VAT,  the excess part will be refunded. In general 
condition, the enterprises should apply to tax auth orities for the refund of the VAT after the export 
goods actually leave the country.  
Secretariat Report-para1.31, page 22 
 "During 2013, a number of monetary policy change s were introduced, including further steps on 
interest rate liberalization, which now allow financial institutions to freely determine their lending 
rates, and the establishment of Short-Term Liquidity Operations (SLO) and a Standing Lending 
Facility (SLF); some of these changes may have an impact on trade due to their effect on exchange rate markets and on the av ailability, and cost of credit." 
 
Question 32 In one of the monetary policy changes introduced by China on 20 July 2013, it is stated that the 
PBC decided to remove controls over interest rates on loans offered by financial institutions. It is 
further stated that the lending-rate floor, which was 70% of the benchmark lending rate, was removed and financial institutions are now free to determine their lending rates based on commercial principles. Can China please clarify that the financial institutions mentioned here WT/TPR/M/300/Add.1 
 
- 330 - 
 
  
 include both state-owned financial institutions and privately owned institutions. Whether there are 
any instructions or guidelines whereby China Ex imBank provides export finance of short term 
duration (less than 2 years) at any special rates which other commercial banks either state owned 
or privately owned are unwilling to provide. 
 Answer 
The Export-Import Bank of China's call rate float on the basis of the benchmark interest rate.  Secretariat Report, para3.126, page 88  
"In addition to the programmes notified by China, there appear to be other support programmes 
and other means to support different industries (e.g. fisheries) including through the provision of grants, policy lending by state-owned banks and th e supply of goods at lower than "market price" 
by state-owned enterprises (SOEs) (Table A3.6).  However, in the context of this Review, no 
information was provided to the Secretariat regarding these specific programmes or China's industrial policies that supported different areas of the economy. Moreover, the identification of 
these programmes has not been possible for the Secretariat, as specific support measures seem to 
be the result of internal administrative measures that are not published in English. In addition, the Secretariat did not have access to an itemized central budget to be able to identify the outlays."  
Question 33 
In addition to the programmes notified by China, there appears to be other support programmes to support different industries including fisheries sector. Can China please give details of various 
support programmes which are in the nature of subsidies for its fisheries sector?  
 Answer 
A c c o r d i n g  t o  T h e  L a w  o f  t h e  P e o p l e ' s  R e p u b l i c  o f  C h i n a  o n  E n t e r p r i s e  I n c o m e  T a x ,  A r t i c l e  2 1 ,  Item 1, and The Enforcement Regulations of th e Law of the People's Republic of China on 
Enterprise Income Tax, enterprises engaging in high sea fishing shall be exempted from corporate income tax; enterprises engaging in sea farming and inland-water farming shall be reduced 
corporate income tax by half. 
In accordance with the Announcement on the prefer ential issue of the implement of the corporate 
income tax of the farming, forestry, animal husbandry and fishery projects by the SAT ( 
Announcement by the SAT 2011, number 48), the fa rming, forestry, animal husbandry and fishery 
projects that conform with the article 86 of the enforcement regulations and enjoy the preferential 
tax, unless otherwise specified, shall follow the st andard stipulated in the National Industries 
Classification .GB/T4754-2002For the deep-sea fishery enterprises with the qualification certificate 
of the deep-sea fishing enterprise issued by the Ministry of Agriculture, the gains from deep-sea 
fishing within the certificates validity shall enjoy the exemption from corporate income tax.  WT/TPR/M/300/Add.1 
 
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 24  QUESTIONS BY AUSTRALIA 
Report by the Secretariat - WT/TPR/S/300 
 
SUMMARY 
 Page 10, Paragraph 12 
 
We note the Secretariat Report has concluded that in relation to the various Catalogues associated with the implementation of China's trade and investment policy "[i]t is not always clear how the different Catalogues should be read, as they so metimes overlap and even conflict, reflecting the 
different agendas at the different levels. The different layers of regulation add an additional level 
of difficulty when trying to unravel specific policy measures in China". 
 
Question 
Does China plan to continue to reform its legal instruments surrounding trade and investment, including reducing contradictions and ambiguity between policy measures at different levels? 
 
Answer 
Presently ，China has established a relative perfect planning system, which may join all plans 
together, and coordinate and unify them as well. The overall planning of China, as an overall 
blueprint proposed by levels of governments for economic and social development, is strategic, programmatic, and comprehensive, and it focuse s on defining matters within the scope of 
government responsibilities. Development programme s like special planning and regional planning 
are mainly based on formulation and revision of overall planning. Plans at national level and provincial or municipal level have been complete ly connected during the planning and formulation 
process for them though they be different in focus and scope of validity, and at the same time, 
relevant opinions have been solicited broadly for them. The plans will be promulgated to the society immediately after review and approval of levels of NPCs, and so problems like excessive levels and lack of transparency do not exist. 
 
In industrial planning, the Chinese Government guides industrial development by a guidance 
directory. During implementation, kinds of market participants are treated equally, fairly, and 
openly, and the planning may be revised dependent on circumstances. 
 Next, we will, according to the gist of the Third Plenary Session of the 18
th National Congress of 
the Communist Party of China (CPC), make the market play a decisive role in allocation of 
resources and better the government functions, so as to successively put forward the reform and innovation of planning system of China, and further improve the planning system of China.  
Page 11, Paragraph 17 
 Australia notes the Secretariat report has concluded that despite efforts to facilitate trade, customs 
procedures across the country still require harmonization.  
 Question 
Can China please provide advice on the work be ing undertaken to harmonise customs procedures 
across the country and identify any specific areas in which the procedures have already been harmonised?  
Answer 
China Customs, as a law enforcement agency of vertical management system, is guaranteeing and 
accelerating unification of customs procedures across the country through fully advancing legal 
construction of customs all over the country and continuously deepening reform of customs 
clearance.  
First, strengthen work on legislation, continuo usly improve and perfect the system which customs 
enforcement is based on. Improve the legislation mechanism, as well as the legislation procedures and modes. WT/TPR/M/300/Add.1 
 
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 Second, promote work relevant to establishment of a uniform long term mechanism for customs 
enforcement, e.g. establish and improve the mechanism for finding, settling, and feeding back unconformity of enforcement procedures, as well as regional harmonization and cooperation 
mechanism for customs enforcement, customs service standardization system, and administrative 
interpretation system. In recent two years, Ch ina Customs selected some problems that had 
significantly influenced the harmonization of cust oms enforcement, had been paid high attention 
by the society, and had caused strong repercussions each year for study and settlement, so that a 
fair, just, safe and convenient customs environment may be created through unified and standardized enforcement procedures across the country.  
Third, further standardize the customs discretion. Fo r the right of discretion concerning main fields 
for enforcement like unit consumption manage ment, product classification, enterprise 
classification, and administrative penalty, study and formulate measures for standardization, and 
define enforcement standards and requirements for relevant implementation, so as to guarantee 
standardization and unification of customs enforcement.  
Finally, strengthen the legal supervision function of  administrative reconsideration, i.e. remedy the 
deviation in enforcement through administrative reconsideration, so as to standardize customs enforcement. As handling cases of administrative reconsideration, pay more attention to summarization and analysis on universal and regular problems reflected from the cases, and 
propose to relevant institutions or departments opinions and suggestions on legislation perfection, 
enforcement standardization, work improvement, and risk prevention and control, so as to 
promote standardization and unification of customs procedures; through every day and special law 
publicity and education activities, continuously strengthen the concept on rule of law and legal 
accomplishment among custom staff, so as to guarantee the customs enforcement may be unified across the country. 
 
Paragraph 33, Page 13  We note the Secretariat Report has concluded that "[d]espite efforts undertaken by authorities to 
combat infringement, enforcement of IPRs co ntinues to be a major challenge for China". 
 Question 
Could China provide information on how it continues to strengthen its capacity to protect and 
enforce intellectual property rights for both domestic and foreign entities?  
Answer 
At present, the situation for protection of intellectual property rights is still grim. To further combat 
relevant infringement, the Chinese govern ment will take the following measures. 
 
First, for serious problems, organize special actions, including crack down on the crimes of 
infringement and imitation by network. Carry out special activities for combating counterfeit gasoline and diesel, crack down on illegal acts like production and processing that fail to meet 
relevant legal standards at links of crude oil processing as well as production, storage, 
transportation, and sales of product gasoline and diesel oil. Strengthen business secret protection according to relevant laws. For obtaining the business secret of the owner by means of stealing, 
luring, and coercion, and for requesting illegal disclosure and use of the business secret of the 
owner or allowing the third party to use the business secret of the owner in violation of the agreement or the owner's requirements for keeping business secrets, take further measures to strengthen administrative law enforcement and judicial protection. Perfect relevant systems, 
strengthen complaint handling, and keep the commercial secrets in technical data submitted by 
relevant enterprises according to relevant laws. Judge and promulgate typical cases concerning infringement of commercial secrets in accordance with relevant laws. 
 
Second, carry out centralized remediation on main fields. Conduct special governance for cracking 
down on counterfeit agricultural materials, dig out the sources for manufacturing and selling of 
counterfeit and inferior agricultural goods, investigate and treat illegal activities like production  
and selling of counterfeit goods, unlicensed business activities, affiliated business and operations beyond scope. Carry out a campaign for cracking down on counterfeit named as "Sharp sword for 
quality control" concerning building materials, auto parts, mobile phones, and articles for children. WT/TPR/M/300/Add.1 
 
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 Strike unlawful acts concerning import and export of fake and shoddy goods, manufacturing and 
selling of counterfeit and inferior drugs, selling of substandard goods in field of distribution, and trade mark infringement. Prevent and restrain malicious registration of trademark. Based on well-
known trademarks and foreign trademarks, investigate and deal with accordingly large scale trans 
regional infringement cases that have caused strong repercussions
，and strike unlawful acts like 
counterfeiting famous trademarks, packaging, decora tion, and etc. Strike unlawful acts concerning 
infringement of copyright. Carry out a special ca mpaign for law enforcement and right protection 
concerning patent named as "Escort". Strike unlawfu l acts concerning infringement of the rights for 
new varieties of plants. Investigate and deal with unlawful acts like infringement of intellectual 
properties concerning geographical indication, layout designs of integrated circuits, and the China 
time-honoured brand according to relevant laws. Improve regulatory measures for infringement risks of port cargo, strengthen the customs en forcement system for intellectual property right 
protection, and advance application of authorised edition of software. 
 Third, strengthen criminal justice, and strike crimes severely. Carry out supervision on special 
cases concerning crimes threatening safety of foods and drugs, and strengthen supervision on 
arrest approval, prosecution and litigation. Focusing on crime of dereliction of duty in Infringement 
and counterfeiting carry out special work on preven tion and punishment of duty crimes. According 
to relevant laws, strengthen judicial work on crimes of main trades or fields for infringement and 
counterfeiting, as well as fine punishment, so as to deprive the infringer of capabilities and 
conditions for recidivism. Organize trial live for major cases.  
Fourth, deepen reform and innovation, and streng then institutional improvement. Improve laws, 
regulations and systems. Advance revision of regu lations for the implementation of copyright law, 
patent law, seed law, trademark law, and regu lations on patent agency. Carry out preliminary 
studies on revision of anti-unfair competition law, and regulations on customs protection of 
intellectual property rights. Strengthen connect ion between administrative law enforcement and 
criminal justice. Perfect the systems for case consulting, information report, data statistics, and follow-up supervision concerning the connection, as well as the work mechanism. Perfect the 
central information sharing platform, accelerate the establishment of information sharing platform 
below provincial level, and promote docking between the platforms. Promote information disclosure for administrative punishment cases; include the disclosure into the scope of statistics 
bulletin for work against infringement and counterfeiting, so as to strengthen the examination and 
assessment. Collect and organize disclosed informat ion on cases, and provide inquiry services for 
the society. Try to forbid persons with dishonest behaviour relevant trades that are as the main for 
fighting against infringement and counterfeiting. Accelerate the establishment of legal person 
system based on organization code and other cred it code systems. Set the "Blacklist" for illegal 
business entities and their legal representatives, operators, and directly Responsible Individual, 
and carry out relevant supervision on main subjects according to relevant laws. Carry out 
performance assessment on fighting against co ncerning infringement and counterfeiting. 
Centralize cases that have seriously violated public interests and affected the health of economy development for supervision in handling. Carry out bio-safety disposal for goods of infringement 
and counterfeiting to be destroyed based on classification, and establishes a mechanism for  
collaboration between government departments and information sharing mechanism.  
Fifth, strengthen publicity and education, and ex pand foreign exchanges. Advance daily publicity 
and education. At important time points, such as Spring Festival, National Day, the national "two sessions", World Consumer Rights Day, World Intellectual Property Day, and National Legal Awareness Day, Concentrate on publicity and educ ation, release authoritative information, and 
respond to social concerns. Fully take advantage of government websites of regions and 
departments for interaction between the government and enterprises, consumers or the holder of the intellectual property right. Do well the 6t
h round of China-US Strategic and Economic Dialogue, 
the 25th Consultation work of intellectual property  issues by JCCT. Carry out dialogues concerning 
intellectual property rights between China an d Europe, and between China and Sweden, and 
promote cooperation with bric countries and countries along the silk road economic belt. Deepen  
exchange and cooperation with India, Russia, Brazil and Africa in fighting against infringement and 
counterfeiting, and maintain the brand image of  "Made in China" Strengthen international 
cooperation for law enforcement.  WT/TPR/M/300/Add.1 
 
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 Sixth, improve the service system constructi on for reports and complaints, and implement 
reporting incentives. Exert special efforts on sp ecial legal services for intellectual property, 
Strengthen business training and law enforcement capacity building, appropriate the funds for law 
enforcement supervision, reporting incentives and bi o-safety disposal of involved articles, and give 
the grassroots more resources for law enforcement.   
1 ECONOMIC ENVIRONMENT 
1.1.2 Recent Economic Developments/Real ec onomy/Fiscal policy and structural reform 
 Page 21, Paragraph 1.27 
 
Australia notes that measures to improve income distribution have been put in place.  
Question 
Has there been an evaluation of the impact of these polices on China's income distribution?  
 
Answer 
Generally, these policies have achieved significantl y, and the income distribution structure of China 
has changed positively. First, the income of urban and rural residents has grown rapidly and continuously. From 2010 to 2013, the actual increase rates for the income of urban and rural 
residents were respectively 8.3% and 10.5%, 0.1%  and 2.3% higher than GDP, and the objective 
of synchronization of income for urban and rural residents with economic development goals proposed in the outline for the 12
th five-year plan had achieved. In the first quarter of this year, 
the per capita disposable income of the country  was 5,562 yuan, increased by 8.6%, 0.5% higher 
than the whole last year, and 1.2% higher than GDP of the first quarter. Second, the income gap 
between urban and rural residents is shrinking,  and the rural residents' income growth has 
exceeded the urban residents' income growth for continuous four years, and the gap has shrunk 
from 3.23 times of 2010 to 3.03 times of 2013. Thir d, the regional income gap, industry wage gap 
and income gap between different groups of resi dents have also been shrunk to some extent. 
 
2 TRADE AND INVESTMENT REGIME 
2.2.2 Trade policy framework and ob jectives/Trade policy objectives 
 
Page 38, Paragraph 2.20 
 We welcome the Decision on Major Issues Concerning Comprehensively Deepening Reforms 
(approved at the Third Plenary Session of the 18t h National Congress of the CPC), which includes 
calling for "the establishment of fair, open and transparent market rules, the elimination of rules which hamper market unification and fair competition, and the punishment of all kinds of illegal and anti-competitive behaviour and actions".  
 
Question Could China provide information on reforms taken or planned to strengthen market competition 
and address anti-competitive behaviour? 
 Answer 
Reasonably define main business of state-owned en terprises, especially the central enterprises, 
and strictly limit investment on operations othe r than main business. Fully implement policies and 
measures to promote the development of non-public economy, and encourage, support and guide the folk capital to industries and fields not expre ssly forbidden by laws and regulations. Establish a 
fair market access system; cogently accomplish transparent market access standards and 
preferential policy support, without additional limit ations on private capital. Encourage and guide 
the non-public enterprises to participate in the restructuring and reorganization of state-owned 
enterprises, invest in the infrastructure construc tion, and establish public services by means of 
equity participation, holding, and asset acquisitio n. Perfect financial services as well as fiscal and  
taxation support policies supporting non-public  economy and development of small and micro 
businesses. 
 WT/TPR/M/300/Add.1 
 
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 Relevant departments will, according to relevant requirements of the central government, actively 
cooperate with other relevant departments to clea n up and abolish rules and practices that hinder 
national union market and fair competition, prohibit and punish kinds of unlawful behaviours in 
adoption of preferential policy, oppose local pr otection, investigate and punish monopoly actions 
according to relevant laws and regulations, and maintain the market order of fair competition.  
Page 39, Paragraphs 2.22-2.25 and page 51, Paragraph 2.81  
 We welcome the creation of the China (Shanghai) Pilot Free Trade Zone (CSPFTZ), and its role in facilitating trade investment and financial services reform. We are pleased with the Negative-List 
approach, and encouraged by the prospect of th e CSPFTZ providing a model for wider replication 
(Paragraphs 2.22-2.25 on page 39 and Paragraph 2.81 on Page 51 of WT/TPR/S/300).   
Question 
Is information available on details and timing for key reforms that encourage trade and investment, including in the financial services sector?  
 
2.4.1 Regional arrangements/Reciprocal agreements  Page 41, Table 2.1 
 
Question Why is oil excluded from China's liberalization in recent FTAs with Iceland and Switzerland? Does 
this exclusion extend to services and inputs to the oil sector? 
 Answer 
The ore resources are scarce and non-renewable, investment in mining industry is limited by prospecting risks and mining difficulties, and so relevant investment is difficult relatively. With continuous economic development of China, inve stment hot spots in services, manufacturing, and 
other fields have emerged successively, and are favoured by foreign investors. Above market 
factors make the mining industry proportion in total of direct foreign investment in China is 
relatively low.  
2.5.1 Foreign investment regime/Reg ulatory framework and market access 
 Page 43, Table 2.2 
 
Question Given China's strong demand for resources and it s policy of encouraging foreign investment in 
mining (see table 2.2, page 43), is there any in formation available addressing why mining only 
comprises 0.3% of China's inward FDI (Table 1.5, page 32)? 
 Answer 
The Chinese Government welcome foreign enterprises to invest in mining industry of China according to the industrial policies for foreign investment of China. Foreign investment in China's mining industry is a complete market-oriented behaviour, and concerning resources, external 
conditions, technical equipment, economic benefit, and etc., relevant enterprises shall make 
decisions on their own dependent on the market.  2.5.4 Foreign investment regime/China (S hanghai) Pilot Free Trade Zone (CSPFTZ) 
 
Page 51, Paragraph 2.78  
Noting the one of the objectives of the CSPFTZ is "showcase for further trade and investment 
liberalization nationwide", Australia further enquires whether China is considering expanding the liberalizing measures undertaken in the context of the CSPFTZ to other regions and, if so, when 
might that expansion be undertaken?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
In 2013, China established China (Shanghai) Free Trade Pilot Zone and developed the relevant 
pilot programmes of foreign investment manageme nt. In the next step, China will evaluate the 
pilot programs to acquire the experience which may be reproduced and promoted. 
3 TRADE POLICIES AND PRACTICES BY MEASURE 3.1.1 Measures Directly Affecting Import s/Customs Procedures and requirements 
 
Page 56-57, Paragraph 3.5  Question 
Classified Enterprise Administration Reform  - Could China please explain the following: The criteria 
for the nominated classifications? Whether othe r relaxed procedures are applicable to those 
classifications outside those outlined in para 3.6? For which ports do these reforms apply to 
imports? And why is there a limitation on ports for imports but not for exports?  
 Answer 
(1) The customs is reforming the enterprise classification management system, and promoting the construction of enterprise credit management system. Both current customs enterprise classification management system and the enterprise credit management system after reform include all enterprises into the scope for management, and so there is no nominated classification 
at all. In our opinion, the question is to know cr iteria for the high credit enterprise in management 
after reform of customs enterprise classification management system (i.e. enterprise credit management system. 
Credit management system of the customs after th e reform will identify the enterprises as three 
credit levels, certification enterprise, general cr edit enterprise and discreditable enterprise. The 
certification enterprise is AEO enterprise of Chin a Customs, which is further divided into general 
certification enterprise and senior certification enterprise. The customs will perform certification for 
certification enterprise applicants in accordance with "Standards for customs certification enterprises", and identify eligible enterprises as  certification enterprises. The "Standards for 
customs certification enterprises" are formulated according to AEO system standard advocated by 
the WCO and the actual situation of China in customs enterprise credit management, including 
several specific certification indexes for 3 major categories concerning corporate compliance status, standardization for import and export, and trade security conditions. 
(2) Management measures applicable for certification enterprises 
The following management principles and measures are applicable for general certification enterprises: 1
．Lower the rate of import and export goods inspection;  
2．Simplify the documents audit for import and export goods; 
3．Optimize the customs clearance formalities for import and export goods;  
4．Have convenient customs clearance measures provided by the AEO countries of mutual 
recognition or regional customs. 
Besides management measures applicable for cert ification enterprises, the following management 
measures are applicable for senior certification enterprises: 1
．Process the procedures of examination and release before commodity classification, customs 
valuation, and paying up the taxes, or transferring to other customs formalities; 
2．Set coordinator for the enterprises by the customs; 
3．I n  c a s e  o f  a n  e m e r g e n c y ,  g i v e  p r i o r i t y  t o  p r o c e s s i n g  o f  t h e  e n t e r p r i s e s '  i m p o r t  a n d  e x p o r t  
goods 
 II. Reform of paperless customs clearance and its applicability  
At present, the "paperless customs clearance" has become current main operation mode for 
customs clearance. The "paperless customs clearance" refers to classification of import and export goods in 
accordance with the level of risk based on enterprise classification management and risk analysis 
of customs, changing practices of customs for conducting customs clearance formalities by examination of paper declaration forms and a ccompanied documents submitted by import and 
export enterprises. , and through information technology, performing customs clearance by 
paperless review and approval on electronic da ta of customs declaration forms and accompanied 
documents submitted by networking of enterprises. WT/TPR/M/300/Add.1 
 
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 The reform of paperless customs clearance has never limited import and export ports. 
 Page 56-57, Paragraph 3.5 
 
Question Australia notes that the Secretariat report has concluded none of the trade facilitation measures 
implemented by China apply to goods subject to licensing or other restrictions. Can China provide 
advice whether it is considering extending trade facilitation measures to cover all goods?  Answer 
In advancing trade facilitation measures, China Customs does not limit imported and exported cargoes as the objects that the trade facilitation measures are not applicable for. During actual regulation process, China Customs will take more stringent regulatory measures for the main 
commodities for attention. For example, for the solid waste, as a commodity with special 
restrictions on imports, the customs will impose strict import regulations, and trade facilitation 
measures shall not apply for ecological environment protection and the need of people's life, health 
and safety. In addition, as one of the main trade facilitation measures, paperless customs 
clearance has not been realized for licenses presently for difference of informatization level of the departments in charge of licenses.  
Page 57, Paragraph 3.6 
 Question 
Australia notes that the Secretariat report has concluded that the "Reform of Paperless Customs 
Clearance" program is being implemented at all sites of 12 customs offices and select sites at the remaining 30 customs offices. Can China provide advice on whether it will make the Paperless 
Customs Clearance program available at all customs sites, and if so, the timeframe for this? 
 Answer 
On 1 April 2014, the General Administration of Customs promulgated the "Announcement of 
General Administration of Customs on matters concerning deepening reform of paperless customs 
clearance" (Announcement of General Administration of Customs [2014] No. 25), and decided to extend the reform measures and pilot scope to all business spots and business fields of customs all 
over the country, so that the reform of paperless customs clearance may cover the whole country. 
During the process for reform of paperless cust oms clearance, the Ministry of Commerce, State 
Administration of Taxation, the Administration of Quality Supervision, Inspection and Quarantine, 
State Administration of Foreign Exchange, and the Mi nistry of Agriculture participated in the work 
for advancing paperless online verification of certificates and licenses.  Page 57, Paragraph 3.8 
 
Question Australia notes that the Secretariat report outlined that according to guiding opinions issued by the 
State Council in 2012 the rules applying to special customs supervision areas will be unified. Can 
China provide information on the timeframe for unification of customs procedures in these special customs supervision areas and advise where inform ation on these procedures might be available 
to traders? 
 Answer 
To adapt to China's opening to the outside world and economic development at different periods, 
the State Council successively approved the setting of 6 special customs supervision areas for 
tariff-free zone, export processing zone, bonded logistics park, cross-border industrial zone, bonded harbor area, and comprehensive free trade zone (hereinafter referred to as the special 
areas). 
General Administration of Customs is, according to the requirements of the Third Plenary Session of the 18th National Congress of the Communist Party of China (CPC) and " Guidance of the State 
Council for Promoting Scientific Development of Special Customs Supervision Areas" (Guo Fa 2012 
No. 58), steadily pushing forward the integratio n and optimization of the special areas, and 
integrating the types of existing special areas. It plans to integrate present export processing  
zone, bonded logistics park, cross-border industrial zone, bonded harbor area and tariff-free zone WT/TPR/M/300/Add.1 
 
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 that meet relevant requirements into a comprehe nsive bonded area. Specific principles for the 
integration are: (1) The special customs supervision areas newly set are named as "comprehensive bonded area" 
in principle.  
(2) The original special customs supervision areas will be gradually integrated into a comprehensive free trade zone as the originally planned area is unchanged based on opinions 
solicited from local governments. The special customs supervision areas that do not meet the 
requirements for integration may be temporarily preserved.  Page 57, Paragraph 3.8 
 
Question In relation to the statement "Although China is making efforts to harmonize customs procedures 
across the country…" is China able to share any proposed time frames or further details regarding 
the harmonization of customs procedures across China?  
Answer 
China Customs, as a law enforcement agency of vertical management system, is guaranteeing and 
accelerating unification of customs procedures across the country through fully advancing legal construction of customs all over the country and continuously deepening reform of customs 
clearance. 
 First, strengthen work on legislation, continuo usly improve and perfect the system which customs 
enforcement is based on. Improve the legislation mechanism, as well as the legislation procedures 
and modes. Persist in promoting scientific and democratic legislation, and at the same time, with the mechanism innovation and system innovation as a breakthrough point and acting point of 
customs legislation work, ensure unification of th e whole law system for customs, and so provide a 
system guarantee for unification in customs procedures across the country.  Second, strengthen construction in unification of law enforcement, promote work relevant to 
establishment of a uniform long term mechanism for customs enforcement, e.g. establish and 
improve the mechanism for finding, settling, and feeding back unconformity of enforcement procedures, as well as regional harmonization and cooperation mechanism for customs 
enforcement, customs service standardization syst em, and administrative interpretation system. 
In recent two years, China Customs selected some problems that had significantly influenced the harmonization of customs enforcement, had been paid high attention by the society, and had 
caused strong repercussions each year for study and settlement, so that a fair, just, safe and 
convenient customs environment may be created through unified and standardized enforcement procedures across the country.  
Third, further standardize the customs discretion. Fo r the right of discretion concerning main fields 
for enforcement like unit consumption manage ment, product classification, enterprise 
classification, and administrative penalty, study and formulate measures for standardization, and 
define enforcement standards and requirements for relevant implementation, so as to guarantee 
standardization and unification of customs enforcement.  
Finally, strengthen the legal supervision function of  administrative reconsideration, i.e. remedy the 
deviation in enforcement through administrative reconsideration, so as to standardize customs enforcement. As handling cases of administrative reconsideration, pay more attention to summarization and analysis on universal and regular problems reflected from the cases, and 
propose to relevant institutions or departments opinions and suggestions on legislation perfection, 
enforcement standardization, work improvement, and risk prevention and control, so as to 
promote standardization and unification of customs procedures; through every day and special law 
publicity and education activities, continuously strengthen the concept on rule of law and legal 
accomplishment among custom staff, so as to guarantee the customs enforcement may be unified across the country. 
 WT/TPR/M/300/Add.1 
 
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 3.1.4.1 Measures Directly Affecting Import s/Tariffs/Applied tariffs and tariff structure 
 Pages 59-60, Paragraphs 3.17 and 3.18 
 
As the Secretariat notes, there has been little change in China's tariff structure since the last review. However: 
  the lowest rated tariffs have risen slightly, and are above the bound rate; 
  non- ad valorem  rates remain in place, despite being bound at zero;  
  the percentage of tariff peaks remains high; 
   tariff reform has stalled, with the average tariff on industrial products unchanged since 
2009, and the higher average tariff on agricultural goods only slightly lower; 
   the share of tariff quotas remained unchan ged during the review period and at the bound 
level. 
 
Question Does China have any plans to streamline its tariff structure, for example, by eliminating very low 
rated tariffs or non- ad valorem rates? 
 Is further tariff reform being considered?  
Answer 
China has no plan to streamline its tariff structure at present, for there are many levels for 
customs tariff, most of which are results from WTO accession negotiations of China. 
 
3.1.7.1 Measures Directly Affecting Im ports/Anti-dumping, countervailing and 
safeguard measures/Anti-dumping measures 
 
Pages 67-68, Paragraphs 3.40 and 3.42  The Secretariat Report notes that there are no rule s specifying how to impose anti-dumping duties 
in the public interest and that such consideration has not been a factor for considering whether or 
not a measure is imposed. In this context, and at  Paragraph 3.42, reference is made in the Report 
that consideration of the public interest is taken into account for price undertakings.  
 
Questions 
  Could China please elaborate on how it makes such an assessment of the public interest 
and the factors that may be examined for such price undertakings? 
  If there is a breach of the price undertaking, and a subsequent anti-dumping duty 
imposed, is the public interest factor further considered? 
  Is there any unpublished information that might assist understanding of China's public 
interest assessment in anti-dumping cases?  
  Could China provide general information and/or information relating to specific cases 
indicating how it addresses the issue of public interest as a consideration underlying the 
decision whether to impose a measure? 
 Answer to above questions 
In accordance with Clause 37 of the anti-dumping  regulations, the imposition of anti-dumping 
duties must be in the public interest. During the process of anti-dumping investigation, the agency 
conducting the anti-dumping investigation will provide sufficient opportunities to all interested parties, including the manufacturers and expo rters involved, the government involved, the 
upstream and downstream enterprises and relevant trade associations, as well as the importers to 
give their comments through public hearing and meetings for comments etc., and will carefully consider relevant appeals to ensure the objectiv eness, justice and fairness of the investigation. 
Regarding the specific factors to be considered, the investigating agency will examine them case 
by case.  
 WT/TPR/M/300/Add.1 
 
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 Page 67, Paragraph 3.41 
 The Secretariat Report notes that "the authorities have indicated that China does not currently 
examine if a duty less than the margin of dumping is sufficient to eliminate the injury caused by 
dumped imports in final determinations.  
Question 
Could China please elaborate on circumstances of when it would examine and impose a duty less than the margin of dumping where it is sufficient to eliminate the injury caused by dumped imports? 
 
Answer 
Like most of the WTO members, China's Anti-dumping Law neither has provisions on lesser duty 
principle, nor does it investigate the margin of injury. In practice, China does not apply the lesser 
duty rule. But this does not prevent the Chinese investigating authority from conducting the anti-dumping investigations objectively and fairly according to the laws and regulations and taking 
corresponding measures. So far, there is no case in  which the anti-dumping duty rate is lower than 
the margin of dumping.  Page 68, Paragraph 3.43 
 
Question Is the 'reserve list' made public? How can informat ion be voluntarily provided by exporters on the 
reserve list if the exporter questionnaire is only provided to selected exporters? How is information 
voluntarily provided by exporters on the reserve lis t utilised? Do exporters on the reserve list who 
provide information receive an individual rate?" 
 
Answer 
The reserve list will also be made public. Now the exporter questionnaire is published publicly, so that it is by no means provided to selected exporters. In case the sampled companies fail to 
cooperate, the investigating authority can choose companies in the reserve list in place of the 
sampled companies. In case the sampled compan ies cooperate and the companies in the reserve 
list submit response to the questionnaire, the companies in the reserve list may request the 
investigating authority to carry out individual examin ation on them or not. On request of individual 
examination, the investigating agency may carry  out individual examination to determine a 
individual dumping margin on the premise that th e investigation procedure is not affected and the 
investigation can be completed in time.  
 Page 68, Paragraph 3.45  
Question 
Duty refunds appear to be calculated for a 3 mo nth period based on an updated dumping margin 
calculated for a 6 month period. Can China explain why the earlier 3 month period is relevant to 
the amount of refund due during the latter 3 month period? 
 Answer 
According to Chinese laws and regulations, import ers may apply to MOFCOM for a duty refund if 
they can provide evidence that the anti-dumping du ty paid is higher than the margin of dumping. 
MOFCOM can make the refund if applications are verified to be true. The application for refund must be made within three months of payment of  the duty, and the applicants must provide data 
of the normal value and export price in 6-months  period prior to the refund. There is no link 
between these two periods.  
Page 69, Paragraph 3.47 
 Question 
Does a new shipper review permit a refund coveri ng a maximum of three months of imports? What 
constitutes "sufficient quantities as to constitute the basis for the determination of the ordinary export price" in a new shipper review? When does the outcome of a new shipper review take effect? (i.e. is there any retrospective effect of the new individual rate?) WT/TPR/M/300/Add.1 
 
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 Answer 
New shipper review and refund review are two di fferent concepts. New shipper review applies to 
exporters and producers from the country (regio n) involved who had not exported the product 
under investigation during the period of anti-dumping investigation, and who request for review to 
determine a individual anti-dumping duty for them after the original anti-dumping measures have  
taken effect. The duty rate determined here applies to the import of the product under 
investigation after the new shipper review has been in itiated (that is, it applies to the future import 
of the product). In case the new shipper review  determines that dumping exists, anti-dumping 
duty should be retroactively collected on the expo rts by the applicant after the review is initiated 
and before the determination is made. Refund me ans that the importers who can provide evidence 
that the anti-dumping duty paid is higher than  the margin of dumping can apply for a refund. 
Result of the refund review determines whethe r to grant refund on the imports in the past. 
 
3.1.8.1 Measures Directly Affecting Imports/Standards and other technical 
requirements/Standards an d technical regulations 
 
Page 73 and 75, Paragraph 3.67 and 3.73  
 Question To what degree do Chinese mandatory and voluntary standards align with International Standards 
(set by ISO/IEC Codex)? How does China rely on international standards in their 
standards/regulatory development process?  
Answer 
Till the end of 2013, the rate of voluntary and mandatory standards aligning with international 
standards is 73.52%. 
 
Question China published Administrative Regulation on Adopting International Standards back in 2001, which takes adopting international standards as an important technical and economic policy, and 
requires the standards should be developed on th e basis of corresponding international standards 
(including international standards that are almost completed) with an effort to improve harmonization of Chinese national standards and international standards.  
 
Paragraph 3.67 notes that "the AQSIQ ensures that both imports and exports comply with 
technical regulations and certification requirements". Under 3.1.8.2 Product certification, 
paragraph 3.73 (page 75) notes that the product certification system "applies to both domestic 
products and imports". What are the mechanisms to monitor the compliance of exports?  Answer 
Could Australia please clarify which rule it specifically refers to in its question about compliance?  Pages 73-74, Paragraph 3.68 
 
No detailed information is provided in the report on the level of harmonization between Chinese and international standards. 
 
Question Could China please provide further detail on the number, or proportion, of China's standards which have been based on, or reference, international standards? 
 
Answer 
Till the end of 2013, the number of national standards established based on international 
standards is 12753, and the rate of adopting relevant international standards is 73.52%. 
 Question 
Could China provide further information on public consultation undertaken in the development of 
national, sectoral and local standards? WT/TPR/M/300/Add.1 
 
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 Answer 
During the process of developing a standard, interested parties can give their comments and 
suggests at the following stages. One is at project initiation stage, the standards to be developed 
will be published on the website of Standardization Administration of China to call for public 
opinion for normally 1 month; the second is at draft for comment stage, the technical committee will print and distribute the draft to manufacturers, distributors, users, research institutes and 
inspection bodies for comments, normally for 2 months; the third is at approval stage, mandatory 
national standards that involve international trade will be notified to the secretariat of World Trade 
Organization (WTO) according to WTO rules for comments from member states for 2 months.  
Question 
Are private companies able to participate in standards development in China?  
Answer 
Private companies and foreign companies registered in China can participate in the development of 
standards according to relevant regulations. 
 
Question Are foreign companies able to participate in standards development in China?  
Answer 
Private companies and foreign companies registered in China can participate in the development of 
standards according to relevant regulations. 
 
Pages 73-74, Paragraph 3.68  
Question 
Are local/provincial standards inconsistent between provinces? For example, if a good meets mandatory standards in one province might it have to be tested to another standard in a different province? Perhaps worthwhile to establish a whol e-of-government approach to transparency and 
stakeholder input that would be applicable to all Ministries involved in standards/regulatory 
development.  
Answer 
Standardization Law stipulates that local standards can be developed for industrial products that 
need a unified safety and sanitary requirement within the province, autonomous region or 
municipality directly under the central government wh ile no national or sectoral standard has been 
developed. Standardization Law also stipulates th at standards should be developed in favour of 
cooperation and trade. China has a vast territory and great differences exist among different provinces in geographic environment, culture and custom, but the mandatory local standards 
developed by different provinces comply with  WTO rules considering safety and sanitary 
requirements. In practice the mandatory local standards may vary in certain criteria but local standards shall not be in conflict with related laws, administrative regulations, and standards of a 
higher level, and should not adversely affect tr ade. Meanwhile, the Administrative Regulation on 
Local Standards stipulates that in case a filed local standard breaches relevant laws and regulations, the standardization authority of State Council together with related administrative 
authorities will require the local government to take  corrective actions within a limited time or stop 
implementation of the standard.  3.1.8.2 Measures Directly Affecting Imports/Standards and other technical 
requirements/Product certification 
 Page 75, Paragraph 3.73 
 
Question The second last sentence says that "Random conformity sampling tests are conducted on imports 
that have already acquired CCC" (from a CNCA-des ignated body). Can you clarify whether Chinese 
products that have already acquired the CCC mark  (from a CNCA-designated body) will also have 
to undergo random conformity sampling?  WT/TPR/M/300/Add.1 
 
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 Answer 
Chinese products that have already acquired the CCC mark will also have to undergo random 
conformity sampling. 
 
3.1.8.2Measures Directly Affecting Im ports/Standards and other technical 
requirements/Product certification 
 
Page 75, Paragraph 3.75  The report states that the procedures to apply for compulsory certification have not changed 
substantially since the previous review. Australia notes that companies must submit their product 
for type-testing by a CNCA design ated test laboratory in China in  order to receive a CCC mark.  
 
Questions 
  Has China recognised testing by any foreign laboratories as equivalent to testing in a CNCA 
designated test laboratory in China fo r the purposes of CCC accreditation?  
  Has China considered allowing testing by foreign laboratories accredited by an ILAC MRA 
or IAF MLA signatory as equivalent to testing by a CNCA designated test laboratory in China?  
  Noting the significant burden placed on businesses to meet mandatory testing by 
designated authorities, is China considering any other methods of conformity assessment, 
such as suppliers declarations of conformity, fo r any of the products currently listed in the 
"Compulsory Product Certification Catalogue"? 
 
Answer to the above questions 
According to laws and regulations such as Regulations of the People's Republic of China on 
Certification and Accreditation and Administrative Measures for Certification Bodies, Inspection 
Bodies and Laboratories of Compulsory Product Certification, agencies doing the certification and testing of compulsory products must be nominated by CNCA and the nominated bodies must be certification agencies and testing laboratories established in mainland China according to law.  
Foreign laboratories can participate in the testing of CCC certification in accordance with the 
cooperation agreement signed by the two governments or government authorities. CNCA is adjusting and revising the implementation rules for certification of all compulsory products 
based on the principles of "balanced responsibility and authority, control of risk and guarantee of 
quality", and adhere to management of manufacturing enterprises by category throughout the certification process, that is, to issue certificat es to enterprises abiding by laws and regulations 
with simplified certification mode to reduce their certification cost. But at present, supplier's 
declaration of conformity is not acceptable for products listed in the "Compulsory Product Certification Catalogue".  
Page 75, Paragraph 3.75 
 Question 
What are the steps involved and the necessary requ irements for a certification body to be CNCA-
designated?  
Answer 
CNCA has been carrying out designation of certification bodies strictly according to the 
requirement and steps stipulated by Administrative Measures for Certification Bodies, Inspection Bodies and Laboratories of Compulsory Product Certification (Decree No. 65 of AQSIQ). 
 
3.1.9 Measures Directly Affecting Imports/ Sanitary and phytosanitary requirements 
 
Pages 76-77, Paragraphs 3.77 and 3.78  
 Question 
The Secretariat report states "A myriad of laws and implementing regulations and rules continue to 
regulate China's SPS regime; some of these laws are outdated and repetitive". It also states 
"Another salient feature of China's SPS system is the fragmentation of regulatory authorities among different Government agencies." WT/TPR/M/300/Add.1 
 
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 Given there have been no changes since 2010, can China please inform if it has any plans to 
rationalise its SPS system?  
Answer 
WTO does not stipulate how many government agencies of member states should be responsible 
for Sanitary and phytosanitary measures. Most member states including the US has multiple 
authorities in charge of SPS measures, all of  which involve international trade. AQSIQ is 
responsible for the supervision of imported and exported food, animals and plants and animal and plant products; State Food and Drug Administration (SFDA) and Ministry of Agriculture (MOA) is responsible for the supervision of domestic production and distribution; National Health and Family 
Planning Committee (NHFPC) is responsible for the development and revision of national food 
safety standards. These supervision authorities take  their responsibilities by section, with clear 
division of responsibility and cooperation between each other, so the fragmentation of regulatory 
authorities among different Government agencies mentioned in Paragraph 78 Section 3 of the 
Secretariat Report does not exist. There have been no changes to the procedure for setting sanitary and phytosanitary requirements since 2010. If Australia thinks there is anything not 
rational, please indicate clearly. China will study and consider any detailed comments from 
Australia.  Page 78, Paragraph 3.84 
 
The report notes that "between 2011 and 2013, Members raised several concerns regarding measures imposed by China on grounds of sanitary conditions that have not been reported to the 
WTO". 
 Question 
We would like to request of China that, when it does take such measures, they are reported 
promptly to the WTO.  Answer 
China has been reporting to WTO of related meas ures strictly according to TBT/SPS agreement. 
China has reported 1200 TBT measures and 832 SPS measures till June 2014. Among the measures not promptly reported as mentioned by member states, some are in line with 
international standards, some are of little effect  on trade, and some are due to translation of 
different versions or name change of the laws or regulations. In future China will keep fulfilling its 
transparency obligations as always. 
 
3.2.2 Measures Directly Affecting Export s/Export taxes, charges, and levies  
 Page 79, Paragraphs 3.88, 3.90 and 3.92 
 
China continues to apply export taxes – as well as export duties of up to 50% in 2013, interim duties as high as 35% could also be charged, as could a special export duty as high as 75%. Some 
4.2% of tariff lines were subjected to export duty between 2009-11. China also uses export 
quotas. As the Secretariat notes "China is the leading world exporter of certain products subject to export taxes, thus the application of export taxes could have an impact on world prices of these 
products." 
 Question Is China planning to review these extensive imposts on certain exports in the foreseeable future? 
 
Answer 
Chinese Government sets and adjusts import and export tariff rates mainly based on economic 
development, and the production, consumption, import and export of relevant products.  
 WT/TPR/M/300/Add.1 
 
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 3.2.3 Measures Directly Affecting Exports/Expo rt prohibitions, restrictions, and licensing 
 Page 81, Paragraphs 3.95 and 3.96 
 
Question Welcoming the advice that China eliminated certain export quotas on 1 January 2013, we would 
appreciate advice on whether China plans to further reduce or eliminate either global or 
destination-specific export quotas?  Does China plan to update its notification on  export prohibitions, last notified in 2009? 
 
Answer 
We are preparing the notification and will submit soon.  
 
3.2.4 Measures Directly Affecting Ex ports/Export support and promotion 
 
Page 83, Paragraph 3.101 
 We note from the Secretariat's Report that while China indicated that it did not maintain or introduce any export subsidies on agricultural products during 2011 and 2012, no information was 
provided covering the period under review.  
 Question 
Can China provide information for the period under review? 
 Answer 
China doesn't have export subsidies on agricultural products.  3.3.1 Measures Affecting Prod uction and Trade/Incentives 
 
Pages 88-89, Paragraph 3.126 
 We note the Secretariat's statement that "In addition to the programmes notified by China, there 
appear to be other support programmes and other means to support different industries (e.g. 
fisheries) including through the provision of gr ants, policy lending by state-owned banks and the 
supply of goods at lower than "market price" by state-owned enterprises (SOEs). However, in the 
context of this Review, no information was provided to the Secretariat regarding these specific 
programmes or China's industrial policies that  supported different areas of the economy. 
Moreover, the identification of these programmes has not been possible for the Secretariat, as 
specific support measures seem to be the result of internal administrative measures that are not 
published in English. In addition, the Secretariat did not have access to an itemized central budget 
to be able to identify the outlays."  
Question 
Is China able to provide this information to the Secretariat?  
Answer 
China has been keeping its commitment in WTO and other mechanisms and has never provided 
any subsidies to SOEs, so we cannot provide such information. In addition, Chinese government publishes information regarding operational budget of state owned capital according to the Budget 
Law of the People's Republic of China and relevant laws and regulations on publication of 
governmental information.  
Page 87, Paragraph 3.119 (and Paragraph 26 of Summary) 
 The Report notes that China's most recent subsidy notification to the Committee on Subsidies and 
Countervailing Measures was in 2011 and covered the period 2005-2008. The Report also notes 
that the authorities were not able to provide statistical data on budget amounts for programmes or the disbursement for the different support programmes. WT/TPR/M/300/Add.1 
 
- 346 - 
 
  
 Question 
Could China advise on what steps it is taking to make subsidies provided by all levels of government more transparent and when it will submit its outstanding subsidy notifications?  
 
Answer 
China is preparing the next subsidy notification and try our best to incorporate the sub-central 
notification. 
 Pages 88-89, Paragraph 3.126 (and Table A3.6)  
The Report notes that there appear to be other support programmes and other means to support 
different industries and sectors such as fisheries. Table A3.6 lists an extensive range of programs to support the fisheries sector. 
 
Question Could China please confirm that the programs provided to the fisheries sector as outlined in Table 
A3.6 exist? 
 Answer 
China is still in the process of verifying the info rmation contained in table A 3.6. Many programmes 
listed in Table 3.6 are vague, sourcing from various channels, without mention the department and 
scope. China needs more time for verification.   
Question 
We note that programmes to the fisheries sector listed in Table A3.6 include subsidies related to construction and modification of fishing vessels. Could China advise on developments in its efforts 
to reduce its fishing fleet to address over-capacity and overfishing? 
 Answer 
When the last subsidy notification of China was prepared there was not much information 
identified to be specifically related to the fishery industry. In the course of China's preparation for 
the next notification if certain programs are identified to be specific for the fishery sector and should be subject to the notification obligation un der the SCM Agreement, they will be included in 
the notification. China will carry out the work taking into account the information in the table A3.6 
in the Secretariat Report.   
Question 
Can China confirm that the vessels which benefit from the "renovation grants" are for marine capture fisheries?  
Answer 
When the last subsidy notification of China was prepared there was not much information 
identified to be specifically related to the fishery industry. In the course of China's preparation for 
the next notification if certain programmes are identified to be specific for the fishery sector and 
should be subject to the notification obligation un der the SCM Agreement, they will be included in 
the notification. China will carry out the work taking into account the information in Table A3.6 of 
the Secretariat Report.  
 Page 90, Paragraph 3.129 and 3.130  
The Report notes that the People's Bank of China (PBC) guided financial institutions to increase 
financial support to specific key industries. Paragraph 3.130 also indicates that financial institutions are authorized to determine which loans they are to subsidise 
 
Question Could China please elaborate on whether financial institutions are required to provide favourable 
credit as a result of this guidance? If so, are all firms within identified sectors provided with such 
favourable credit and financial support?   WT/TPR/M/300/Add.1 
 
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 Answer 
A commercial bank shall conduct its business in accord ance with the law, free from interference by 
any department or individual. No organization or individual may force a commercial bank to extend 
a loan or provide guarantee for a loan. A commercial bank shall have the right to refuse any 
organization's or individual's demand for a loan or guarantee. To sum up, lending decisions by State owned Commercial Banks are based entirely on commercial consideration. 
 
Page 91, Paragraph 3.132  The Report notes that industry-specific subsidies for inputs, land and technology are provided by 
the Chinese Government to firms that are perceived as strategically important and that "favoured 
companies" can purchase inputs such as components and raw materials below cost and directly from each other. 
 
Questions What criteria are used by the Chinese Government to determine that a company is "favoured" and 
strategically important and therefore can obtain subsidised inputs? 
 Could China please elaborate on whether inputs such as components and raw materials must be locally made?  
 
Answer to the above questions 
Enterprises are the decision makers in the market  and the purchase of different inputs should 
follow market and economic principles. Chinese government does not have any requirements to 
purchase locally made products. We think there must be some misunderstanding to this issue by the Secretariat Report. Chinese government "treat equally and protect equally" various market 
players and aim at creating a fair and competitive market environment for enterprises of different 
ownerships. China has been adhering to its commitment in WTO and other mechanisms not to provide subsidies to SOEs violating the rules,  so China cannot provide such information.  
 
3.3.2.1 Measures Affecting Production and Trade/Competition policy and price 
controls/Overview  
Page 92, Paragraph 3.133 
 Question 
We welcome the adoption and implementation of provisions relating to competition policy and 
price controls. Can information be provided on this and on future reforms to continue to increase transparency and enforcement in these areas?  
Answer 
Since the implementation of Antitrust Law, NDRC has worked hard on antitrust work and gained 
great momentum.  
 
First, we will further detail the law, and map ou t a host of regulatory documents including two 
supporting associations, namely, Provisions against Price Monopoly, Provisions on Law-
Enforcement Procedures against Price Monopoly, and regulatory documents such as Provisions on 
the Pricing Administrative Punishment Procedures, Provisions on the Evidence of Pricing Administrative Punishment, Rules on review and tr ial of Pricing Administrative Punishment Cases, 
and Several Provisions on the Administrative Punishment on Regulating Pricing ".  
 
Secondly, we will work hard on the antitrust law enforcement, thus breaking down a large number of key and serious cases. Among others, we have  probed into and cracked down on a host of 
influential cases concerning price monopoly in su ch markets as LCD panel, liquor, milk powder, 
and Shang Hai gold jewellery. In this connection, we have kept the market order fair and protected legitimate rights and interests of consumers.  
 
Thirdly, we have kept the public updated of the information and make the law-enforcement more transparent. Recently, NDRC and local antitrust law-enforcement organs have exposed a host of WT/TPR/M/300/Add.1 
 
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 cases concerning price monopoly. With that, we have made the law-enforcement fair, equitable 
and open, while moving forward the outreach and literacy campaign of antitrust law.  
 
Fourthly, we focus on the outreach campaign and theoretical study so as to secure an enabling 
environment that makes for fair competition.   
Fifthly, NDRC will follow closely the market dynamics, and step up our law-enforcement efforts to 
make the antitrust law-enforcement more effective and transparent. Beyond that, we work hard to 
m a i n t a i n  a n  o p e n ,  u n i f i e d  m a r k e t  o r d e r  o f  f r e e  c o m p e t i t i o n  s o  a s  t o  s e c u r e  a  f a v o r a b l e  environment where markets can play a decisive role in resource allocation.   
 
3.3.2.6 Measures Affecting Production and Trade/Competition policy and price 
controls/Price controls 
 
Page 101, Paragraphs 3.169-3.170  
Question 
Australia notes that the list of goods and services subject to government prices and government guided prices has not changed since the previo us Review. Could China provide more detail on 
efforts to "move forward with pricing reform in water, oil, natural gas,  electricity, traffic, 
telecommunications and other such areas", in line with the Resolution passed at the Third Plenum 
in November 2013?   
Answer 
Recently, Chinese government is working hard to press ahead with market-based price reform in 
the above-mentioned sectors. And we now made great progresses in this respect. Among others, 
we have lift restrictions on market regulation in  the telecom tariff; we have deregulated crude oil 
price while the refined oil price has met the international standards. Thus, we have straightened out the price relationship. The price for onshore natural gas has put in place a dynamic mechanism 
that is connected with alternative energy. Mean while, we are pressing ahead with the market-
based price reform in telecommunications and communications.  
 3.3.5.2.3 Measures Affecting Producti on and Trade/Intellectual property 
rights/Industrial property/Geographical Indicators 
 Page 115, Paragraph 3.225 
 
Question Are geographical Indictors that have been register ed with Chinese authorities publically available? 
 
Answer 
The geographic indication is open to the public that businesses apply for in Trademark Bureau 
under the State Administration of Industry and Commerce in the form of collective trademarks and 
proven ones.  
 4 TRADE POLICIES BY SECTOR 
4.1.3.1.1 Agriculture/Policy instruments/Bo rder measures/Measures affecting imports 
 Page 126, Paragraph 4.10  
Question 
With regard to its tariff quotas, can china please advise what, if any, changes will be made to its TRQ administrative arrangements following on from the Bali de cision on TRQ administration? 
 WT/TPR/M/300/Add.1 
 
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 Answer 
Tariff Quota represents market access opportunities instead of obligation. The tariff quota for 
agricultural produce in China is totally consistent with its promise of WTO entry. In this respect, 
China has rolled out a host of package promise, including quota quantities, management methods 
and tariff quota at home and abroad. The protocol of WTO entry has made specific requirements in 
detail including quota quantity for China, objects of  of quota distribution , the proportion of state-
owned trade and the redistribution , which are more specific in comparison with relevant terms in 
WTO.   Page 128, Paragraph 4.15 
 
Question With regard to TRQs, can china please explain the relationship with the disciplines on non-
automatic licensing? 
 Answer 
Import tariff-rate quotas are agreed following  negotiations by China and other WTO Members 
under the WTO agreements, which apply to the import of some commodities.  Page 129, Paragraph 4.20 
 
Question We note China's last domestic support notification  was 2008. Can china please advise when it will 
update it notification consistent with its obligations and as part of a shared WTO commitment to 
transparency?  
Answer 
The notification covering 2009-2010 is being prepared. China will accelerate the process and 
provide it to WTO in time.  
4.1.3.2.1 Agriculture/Policy instruments/Internal measures/Support measures  
 Page 129, Paragraph 4.22 
 
Question China's most recent notification regarding domestic support covers the period 2005-2008. Can 
China please submit its domestic support notifications for later periods as soon as possible? 
 The most recent notification to the WTO Agriculture Committee of policy support provided to the agriculture sector covers the period 2005-2008. Could China provide an update of these support 
measures?  
 Answer 
The notification covering 2009-2010 is being prepared. China will accelerate the process and provide it to WTO in time. For detailed informat ion of the support measures, please see to the 
notification. 
 
Page 130, Paragraph 4.23  Question 
We note that Central Government funding for direct payments has increased each year up to2007, 
but then stabilized at RMB 15.1 b illion (US$2.3 billion) per year in 2007-2012. What is the current 
funding for 2013 onwards?  
 
Answer 
Direct payment is increased from 11.6 billion RMB in 2004 to 15.1 billion RMB in 2007. Since then, 
the figure has remained the same. In 2014, direct payment funding is 15.1 billion RMB. 
 WT/TPR/M/300/Add.1 
 
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 4.1.3.2.2 Agriculture/Policy instruments/ Internal measures/Price controls and 
marketing   
Page 131, Paragraph 4.31 
 Questions 
How are storage costs for reserves of corn, rice, soya beans and wheat determined and allocated? 
How are market prices determined for the purc hase of domestically produced grain by the 
"appointed enterprises" for grain reserves?   
Answer 
The enterprises purchase grains from the market at market price. 
 
4.1.3.2.2.1 Agriculture/Policy instruments/ Internal measures/Price controls and 
marketing/Other measures  
Page 132, Paragraph 4.33 
 Question Can China explain why its agricultural insurance scheme has grown in importance in recent years, 
and provide the amount spent on this scheme each year? 
 Answer 
Currently, the insurance scheme in China covers most of the major agricultural commodities. Farmers usually pay a balance of 20-30% of the pr emium. Over the recent years, more and more 
farmers participate in the scheme and more produc ts are covered. The losses caused by disasters 
are reduced by the scheme, promoting the stable  and sustainable development of agriculture. 
However, the insurance scheme is yet to be improved by attracting more farmers and expanding coverage, such as including aquaculture goods. The Government is dedicated to optimize the 
scheme through constant improvement.  
 
4.2.2.2.1.2 Services/Financial  services/Regulatory regime/Recent regulatory changes in 
the banking sector/Bank deposits insurance scheme 
 
Page 140, Paragraph 4.64  
We note that the People's Bank of China is curre ntly preparing draft deposit insurance regulations 
and an implementation plan for the establishment of a deposit insurance system.  Question 
Can China provide any further information on the schedule for rollout of this scheme? 
 Answer 
It is an integral part of deepening the economic  reform to establish deposit insurance system and 
refine risk-disposal mechanism in financial instit utions. Currently, we are working intensively in 
this respect, yet without a specific timetable.  
 
4.2.1.2.4 Services/Telecommunication services/Regulatory regime/Licensing 
 Page 134, Paragraph 4.43 
 
Australia notes that by end 2012, 26,979 companies had obtained licences for value-added telecommunication business. 
 
Question Can China advise what the usual approval period is for foreign companies seeking a value-added 
services license is? 
   WT/TPR/M/300/Add.1 
 
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 Answer 
The telecom regulators should go through all application procedures presented by value-added 
telecom businesses and make decisions of approval or disapproval within 90 days in line with 
Regulations on Management for Foreign Investment in Telecom Enterprises. We should grant those 
applicants gaining approval with Notice on Trial for Foreign Investment in Telecom Enterprises while granting those disapproved applicants with  notice in printout form and justification. 
 
4.2.4.1.1 Services/Telecomm unication services/Regulatory regime/Applied regimes  
 Page 151, Paragraph 4.97 
 
Question Noting that "advanced educational institutions" (limited to joint venture or cooperative) and 
"vocational skills training" are classified in the "encouraged" category according to the Catalogue 
for the Guidance of Foreign Investment Industries, could China explain what measures it is taking to liberalise trade in education services, particularly in relation to provision of education services 
by foreign providers within China? 
 Answer 
Even though many other countries are sensitive to education sector, China pledges to allow for 
Sino-foreign corporation in running schools, and for foreign individuals to work within Chinese 
schools or other educational agents under their invitation. China has fully honored its commitment, and deregulated its educational market to the foreig n education providers. Besides, we will further 
lift restrictions as the domestic market evolves.  
 Page 135, Paragraph 4.46/Page 144, Paragr aph 4.84/Page 148, Paragraph 4.95/Page 
155, Paragraph 4.114 
 Australia notes the services liberalization measures adopted by China in the context of China (Shanghai) Pilot Free Trade Zone (CSPFTZ), including in relation to value-added 
telecommunications services (WTO report 4.46, p 135), financial services (WTO report 4.84, p 
144), construction and relation engineering-de sign services (WTO report 4.95, p 148) and 
education services (WTO report 4.114, p 155). 
 
Question Australia asks whether China is considering additional services liberalisation measures in the 
CSPFTZ? 
 Answer 
China has clearly identified the deregulation measures in the service sector in line with The Overall 
Action Plan for China (Shang Hai) Free Trade Pilot Zone and delivered on the 2013 version of 
negative list . Against this backdrop, Shang Hai Municipality is securing support from ministries and bureaus, and working on measures to further extend this pilot program. 
 
APPENDIX TABLES  
Page 184, Table A3.3 – Item 11 
 Question 25% preferential tax treatment item 11 – Coul d China please explain the following: What 
constitutes "production in line with state industrial policies"? And what entails "comprehensive use 
of materials stipulated in the "Category of comprehensive use of resources for preferential income tax treatment"?  
 
Answer 
You are kindly suggested to refer to The Notice (2008) on the Catalogue of Tax Breaks for 
Enterprises Engaging in Integrated Use of Resources by Ministry of Finance, State Administration 
of Taxation and NDRC.   WT/TPR/M/300/Add.1 
 
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 Page 186, Table A3.4 – Items 22, 23, 24 
 Question 
Could China please explain in more detail these initiatives dealing with the preferential tax 
treatment for building material products (and other products) produced with "integrated utilization of resources"? 
 
Answer 
As a part of efforts to promote the recyclable use of renewable energy, China has rolled out value-added tax exemption policies for the residues-based building blocks while the list for building 
blocks free from tax is available on the website of Ministry of Finance with the Notice (Decree 
No. 156 in 2008) on the Catalogue of Tax Policies for Enterprises Engaging in Integrated Use of Value-added by Ministry of Finance, State Administration of Taxation and NDRC. 
 
With respect to tax income, 90% of the yieldings for integrated use of resources products by enterprises should be added into the annual total income when calculating taxable income. 
 
These programmes have been notified in China's SCM notification for 2005-2008, please refer to G/SCM/N/155 and G/SCM/N/186.  
Page 189, Table 3.5 
 Question 
Could China please advise whether the import duty exemption for all goods imported into the 
WFTZ (CSPFTZ or any other FTZ in China) exte nd to infrastructure, equipment, technology, 
components, spare parts, etc. used in the production  of (but not incorporated into) exports? If so, 
could China please explain how this is consistent with its WTO obligations? 
 Page 191, Table A3.6  
Question 
Could China please explain how the tax incentives provided to shipyards for the building and export of fishing vessels are consistent with its WTO obligations?  
 
Answer 
When the last subsidy notification of China was prepared there was not much information 
identified to be specifically related to the fishery industry. In the course of China's preparation for 
the next notification if certain programs are identified to be specific for the fishery sector and should be subject to the notification obligation un der the SCM Agreement, they will be included in 
the notification. China will carry out the work taking into account the information in the table A3.6 
in the Secretariat Report.  
 REPORT BY CHINA- WT/TPR/G/300 
 
2 ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMIC POLICY DIRECTION 2.3.1 Adjusting Economic Structure and Tran sforming Development Pattern/Adhering to 
expanded domestic demand 
 Page 7, Paragraph 2.16   
Question 
China notes that it continues to make efforts to increase the income of urban and rural residents and improve their capacities for consumption, by th e means of increasing spending on agriculture, 
rural areas and farmers, implementing structural  taxation reduction and expanding employment. 
What are the forms of spending on agriculture?  
Answer 
As for the form of investment in agriculture, you can refer to the commitment made by China to 
WTO about the supporting measures.  WT/TPR/M/300/Add.1 
 
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 2.3.5 Adjusting Economic Structure an d Transforming Development Pattern 
/Consolidating and strengthening the foundation for the development of agriculture and rural areas  
Page 10 
 Question 
We welcome updated advice about china's agriculture sector policy objectives, including as a driver 
of economic growth and development. Can china pl ease explain its view on the role of imported 
food in helping meet dietary requirements and consumer preferences?  
Answer 
Due to large population, import food plays an active role in meeting dietary demands and 
consumers' diversified favors.  
 
3 TRADE AND INVESTMENT DEVELOPMENT AND RELATED POLICIES 3.2.1 Promoting Balanced and Sust ainable Development of Trade and 
Investment/Striving to balance growth of imports and exports 
 Page 18, Paragraph 3.18  
Question 
Can china please provide further advice on its regi me for interim tariffs. Are these expected to be 
permanent reductions in applied rates? If not, when are the rates reviewed? Can china please 
advise when these rates are published? 
 Answer 
As national economy grows in line with the overall picture of production, consumption and import and export, Chinese government has formulated and adjusted the tariff rates for import and export, among which is the implementation of the temporary goods with tariff rates, tariff rates and duration. You can refer to the Taxation Regulations on Imports and Export for PRC for details 
on temporary tariff rates.  
 3.2.2 Promoting Balanced and Sust ainable Development of Trade and 
Investment/Accelerating the transformation  of foreign-trade development patterns  
 Page 18, Paragraph 3.23 
 
China describes broadly the programs whereby it has encouraged its "processing trade enterprises to extend industry chain and value-added chain,  and increased the added value of products".  
 
Question 
Are locally produced inputs requir ed in such value-added chains? 
 
Answer 
China encourages the processing enterprises to extend the industry chain, and promote supporting 
systems of processing enterprises to move more  in both upper streams and lower streams. But 
there is no compulsory requirement for local procurement.  
 3.4.1 Constructing Economic and Trade Partne rships Based on Mutually Beneficial and 
Win-Win Principle/Committed to advancing the Doha Development Agenda 
 
Page 22, Paragraph 3.45  As an outcome of the "early harvest" negotiation at Bali in December 2013, members reached an 
Understanding on Tariff Rate Quota Administration Provisions of Agricultural Products, as Defined 
in Article 2 of the Agreement on Agriculture — Mi nisterial Decision — WT/MIN(13)/39 or WT/L/914. 
Paragraph 7 of this Understanding states that "importing Members shall ensure that unfilled tariff 
quota access is not attributable to administrative procedures that are more constraining than an 
"absolute necessity" test would demand."  WT/TPR/M/300/Add.1 
 
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 Question 
Considering many of China's agricultural tariff quota commitments have been under filled in recent years, how does China intend to demonstrate that these under fills are not attributed 
administrative procedures that are more constraining than an "absolute necessity" test would 
demand?  What is China's definition of an "absolute necessity" test? 
 
Answer 
Since China's accession to WTO, we have been allocating tariff quota to enterprises according to our commitment. Enterprises who have the quotas  decide to use them or not by themselves, 
depending on various market factors.  
 In terms of wheat, corn and rice of which the quot a is under filled, we were blessed with increasing 
harvests for 10 consecutive years since 2004. The domestic supply has been sufficient and market 
prices are stable. Thus the enterprises lack incentives to import from the international market.  
3.4.4 Constructing Economic and Trade Partne rships Based on Mutually Beneficial and 
Win-Win Principle/Enhancin g South-South cooperation 
 Page 24, Paragraph 3.60 
 
Question We acknowledge china's zero-tariff for LDCs, as an  important mechanism to facilitate greater LDC 
participation in trade. Can china please provide advice on which products are excluded from this 
arrangement?   
Answer 
You can refer to the following website for 95% of all tax items enjoying zero tariff and tariff 
number, http://gss.mof.gov.cn/zhengwuxinx i/zhengcefabu/201306/t20130625_935120.html. WT/TPR/M/300/Add.1 
 
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 ADDITIONAL QUESTIONS BY AUSTRALIA 
WT/TPR/S/300 – The question refers to sect ion 3.3.3. on State Trading Enterprises 
(p.102)  
 
Australia welcomes the information contained in table 3.17 of the TPR, listing China's STEs for the period 2011-13. Australia notes that China's last notification to the Working Party on STEs covers 
only up until the period 2003. Can China please advi se when it will submit an updated notification 
to the Working Party on State Trading Enterprises?   Answer 
The state trading regime of China, including th e products covered and the list of state-trading 
enterprises, has not seen major changes since the 2003 notification G/STR/N/9/CHN/Add.1, except that a couple of products were no longer subject to the state trading regime. Also, for a few 
products subject to state trading, some statistics required in the notification are not officially 
produced in China. In view of these, the state trading notification was not submitted. If Members 
expect China to submit the notification despite of  the few changes, China will prepare a notification 
as soon as possible. WT/TPR/M/300/Add.1 
 
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 25  QUESTIONS BY MALAYSIA 
GOVERNMENT REPORT 
 
Page 9 Para 2.30 
 Since the last review, the Chinese Government continues to carry out the work to close down 
excess and outdated production capacity in the in dustries of high consumption and high emission 
such as steel, cement and electrolytic aluminium.  Para 2.31 
 
From 2008 to 2012, China accumulatively closed do wn backward production capacities of 117 
million tonnes in iron-making, 78 million tonnes in steel production, and 775 million tonnes in 
cement. 
 Question 
In carrying out industrial restructuring, was there any incentive given to the industries in order to 
close down the outdated and backward production? What are the issues and challenges in doing so?  
Answer  
According to the Notice of the Ministry of Fina nce and the Ministry of Industry and Information 
Technology on Printing and Distributing the Measures for the Administration of Central 
Government Subsidy Funds for Closure of Small Businesses (Cai Qi [2010] No.231), the central 
government subsidy fund for closure of small busine ss is in the form of substitute subsidies with 
rewards to support local governments to make policy closure of small enterprises that have such 
problems as over-capacity, resource and energy waste, environmental pollution, salient safety 
hazard and irrational layout. Subsidy funds ar e mainly used for the expenditures of staff 
resettlement for enterprises closed down. The sustained steelmaking capacity growth in China is attributed to many reasons and the root cause is insufficient demand as a result of production 
capacity formed by high-speed economic development and economic downturn. Solving As a long-
term arduous task, solving over-capacity cannot be  accomplished overnight. China has proposed a 
series of measures of consumption expansion, ba ckward elimination and industrial integration to 
relive over-capacity. As China adjusts its economic structure, it will gradually solve over-capacity. 
 SECRETARIAT REPORT 
 
Page 87 para 3.119   The authorities were not able to provide statisti cal data regarding disbursement for the different 
support programmes, taxes forgone as result of the support measure; or the amount budgeted for 
these.  
Question 
How does China assess the impact of their incentive programmes?  
Answer  
To be answered.  WT/TPR/M/300/Add.1 
 
- 357 - 
 
  
 26  QUESTIONS BY BRAZIL 
PART I: QUESTIONS REGARDING THE SECRETARIAT REPORT 
 
Summary 
 Page 9 (Paragraph 1) 
 
The Secretariat mentions "structural tax reduction policy". "The Chinese Government continues to 
promote consumption expansion through specific measures, including a structural tax reduction policy." 
 
Question 1. Could China provide details of this tax reduction policy? 
 
Answer 
China has issued a series of structural tax reduct ion policies, mainly including implementing value-
added tax transition reform in an all-round way and allowing VAT input tax rebates for new 
machines purchased by enterprises; lowering the rate for small-scale VAT taxpayers from 6% and 4% to 3%; significantly raising the thresholds of VAT and business tax as of 1 January 2011 (e.g. 
raising the VAT threshold of goods for sale and taxable services from monthly sales volume of 
RMB2,000-5,000 and RMB1,500-3,000 to RMB5,000-RMB20,000; exempting small-scale VAT 
taxpayers with monthly sales volume below RMB20,000 and enterprises or non-enterprise institutions of business tax payers within monthly sales volume below RMB20,000 from VAT and 
business tax as of 1 August 2013; extending the policy of half enterprise income tax for small low-
profit enterprises to 31 December 2016 and expa nding the scope of implementation to small low-
profit enterprises with taxable income belo w RMB100,000 (included) as of 1 January 2014; 
implementing pilot reform of VAT for business tax and steadily expanding the scope of pilot reform 
as of 2012.   To satisfy domestic economic and social development and consumption demand and promote 
economic restructuring, China implemented provisional annual import tariff rate lower than the 
MFN tariff rate for more than 760 imported goods in 2014, with an average preference rate of 60%.  
 
Page 9 (Paragraph 3)  
 
The Secretariat affirms that in China "the public sector controls some 40% of fixed-asset 
investment and accounts for some two-thirds of total exports".   Question 
2. Does China public sector expect to maintain such a control over investments and exports or 
should it decline with the reforms adopted at the CPC Third Plenum, on November, 2013? 
 
Answer 
In 2013, private fixed-asset investment accounted for approximately 60% of total social fixed-
asset investment and investment controlled by pub lic sector and foreign investment belonged to 
remaining 40%. As emphasized by the Decisions on Several Important Issues Concerning 
Comprehensively Deepening Reform, "we will deepen the economic system reform giving play to the decisive role of market in resource allocation" and "deepen investment system reform and establish the status of enterprises as investment subject". China has vigorously promoted the 
development of private investment by encourag ing and guiding the implementation of private 
investment policy and local governments have vi gorously introduced foreign investment by 
multiple measures and promoted the development of foreign investment. China will gradually relax 
control over investment along with the implementation of above-mentioned reform decisions and 
deployments.   WT/TPR/M/300/Add.1 
 
- 358 - 
 
  
 Page 10 (Paragraph 9) 
 The Secretariat mentions that China envisages "the reform of the investment regime to make it 
more open and predictable" and "the opening-up of border areas".  
 Question 
3. Could China provide details about those reforms? 
 Answer 
Regarding the reform of the foreign investment regime, China will unify domestic and foreign 
investment laws and regulations and maintain fo reign investment policy stable, transparent and 
predictable. We will carry forward orderly opening of service sectors including finance, education, 
culture and healthcare, relax control over foreign investment access to service sectors such as 
child care and provision for the aged, architectural design, accounting audit, commercial logistics 
and e-commerce and open general manufacturing in dustry wider to the outside world. China will 
explore the management model of pre-access national treatment plus negative list for foreign 
investment.  
 With respect to the opening-up of border areas,  China will properly relax control over access to 
featured and advantageous industries in the border areas, grant policy supports in tax, transfer 
payment, personnel exchange, processing logistics and tourism, vigorously develop border 
economic cooperation zones, cross-border economic cooperation zones and other opening platforms by leveraging the cooperation mechanism established by China and neighboring 
countries, accelerate infrastructure connection with neighboring countries and regions and 
facilitate the construction of the Silk Road Economic Belt and the Marine Silk Road.   
Page 10 (Paragraph 10)  
 
China's notifications to the WTO cover a wide range of agreements; however updated notifications 
appear to be necessary in the area of subsidies. 
 Question 
4. Could China explain why the Secretariat affi rms that "updated notifications appear to be 
necessary in the area of subsidies"?  
Answer 
China has been working hard on preparing the next subsidy notification since the last trade policy 
review, and is trying to finalize its submission as soon as possible.  
Page 10 (Paragraph 13) 
 
China encourages direct inward FDI as well as joint ventures between Chinese and foreign 
companies, particularly with regard to R&D activities. FDI is directed towards the areas in which China has a strategic interest.  
Question 
5. Could China explain how "FDI is directed towards the areas in which China has a strategic interest"? 
 
Answer 
Utilizing foreign investment constitutes an import ant part of China's open economy. The Chinese 
Government has adjusted industry policies for foreign investment when deemed appropriate by 
amending the Catalogue of Industries for Guiding Foreign Investment with a view to meeting objective requirements of China's economic deve lopment, economic restructuring and change of 
mode of economic growth. On 30 January 2012, the Chinese Government implemented the new 
revised Catalogue which was revised by following the four principles. First, to promote 
manufacturing transformation and upgrading and re gard high-end manufacturing as a key field of 
industries encouraged for foreign investment. Se cond, to seize the opportunity of international 
strategic emerging industry development to encourage foreign investment in strategic emerging 
industries such as energy conservation and environmental protection, new-generation information WT/TPR/M/300/Add.1 
 
- 359 - 
 
  
 technology, biology, high-end equipment manuf acturing, new energy, new materials and new 
energy vehicle and improve China's proficiency in  undertaking international industrial transfer. 
Thirdly, to encourage foreign investment in modern services and support service sectors oriented 
at people's livelihood to expand foreign investment utilization and steadily carry forward the 
opening up of service sector. Fourth, to promote cross-regional balanced development. China will implement the deployments of advancing the new round of development of the west regions, 
revitalizing old industrial bases such as northeast China and vigorously promoting the rise of the 
central region proposed in the 12
th Five-Year Plan and encourage central and western regions to 
undertake industrial transfer and develop featured advantageous industries.   
Page 11 (Paragraph 19) 
 
However, these lists can be adjusted as necessary , and imports of goods that are not included in 
the Catalogue can be restricted or prohibited on a temporary basis by the relevant authorities.The Secretariat assesses that "import of goods that are not included in the Catalogue can be restricted 
or prohibited on a temporary basis by the relevant authorities". 
 The Secretariat assesses that "import of goods that are not included in the Catalogue can be restricted or prohibited on a temporary basis by the relevant authorities". 
 
Question 6. Where the information on temporarily rest ricted or prohibited goods can be found? 
 
Answer 
China has adopted temporary prohibitive measures for relevant animal products from countries 
and regions where an epidemic outbreaks which are available at the official website of the AQSIQ 
and the Ministry of Agriculture in the form of jo int announcement by the AQSIQ and the Ministry of 
Agriculture. The Ministry of Agriculture develops monthly Official Veterinary Bulletin to summarize 
and release relevant measures which is also availa ble at the official website of the Ministry of 
Agriculture.  
 Page 13 (Paragraph 28)  
 
The Secretariat affirms: "The People's Bank of China (PBC) has guided financial institutions to intensify financial support to areas such as scientific and technological innovation, emerging 
industries of strategic importance, and service industries. Financial institutions were also guided to 
extend credit support for railways, shipping, thermal power and steel, and were encouraged to use credit products flexibly to support profitable export-oriented enterprises".  
 
Question 
7. Could China list the instruments used by PBC to guide the credit towards the specific areas mentioned in the Secretariat report?  
 
Answer 
The People's Bank of China has no requirement on the direction of credit. The financial institutions, 
as a independent market player , make their own decisions on lending or credit. 
 1 - ECONOMIC ENVIRONMENT  
Page 20 (Paragraph 1.22)  
 According to the report by the Secretariat, "eff orts were made to enhance coordination between 
credit policy and industrial policies". In line with those efforts, "PBC guided financial institutions to 
intensify financial support to key industries and sectors" and "financial institutions were encouraged to use credit products flexibly to enhance support for export-oriented enterprises that 
were able to attract orders". 
 Question 8. Could China elaborate on those credit guidelines issued by the PBC? 
 WT/TPR/M/300/Add.1 
 
- 360 - 
 
  
 Answer 
Please see answer to question 7. 
 
Question 
9. What institutions in China provided the credit for the export-oriented enterprises? 
 
Answer 
Please see answer to question 7. 
 Question 
10. How the financial institutions were encouraged to use credit to support export-oriented 
enterprises?  
Answer 
Please see answer to question 7. 
 
Question 
11. What are the credit conditions applied to the mentioned "key sectors"?  Answer 
Please see answer to question 7.  Question 
12. What are export-oriented enterprises that are "able to attract orders"? 
 
Answer 
Please see answer to question 7. 
 Page 21 (Paragraph 1.25)  
 
Starting in 2012, China has offered farmers a num ber of grants via bank accounts and bank card 
agents, such as the new rural social pension insurance, the new rural cooperative medical system 
and various fiscal subsidies related to agriculture, farmers and rural areas for a total of RMB 551.5 billion.   
Question 
13. Could China provide further information on the "various fiscal subsidies related to agriculture, farmers and rural areas for a total of RMB 551.5 bil lion"? How is this amount related to the grain 
self-sufficiency policy? 
 Answer 
The fund of 551.5 billion RMB is allocated to prog rams including the four subsidies, as well as 
social benefits in the rural areas, such as medical services, endowment insurance and so on.  Page 24 (Paragraph 1.1.3.2) 
 
Question 14. How does China assess the effects of exchange rate reform on trade so far? 
 
Answer 
China has steadily advanced the RMB exchange rate formation mechanism by following the 
principles of initiative, controllability and prog ressiveness through 2005 and played a positive role 
in facilitating institutional adjustment and all-round coordinated economic development. Exchange rate fluctuations guide rational resource allocation between trade goods and non-trade goods sectors to facilitate the change of mode of economic growth, help enterprises dependence low 
factor price, improve their technological leve l and core competitiveness and strengthen the 
flexibility of the real economy in response to external change. In general, China's import and export have become more balanced through the exchange rate reform, balance of payments has 
been significantly improved and ratio between current account surplus and GDP has been on a 
steady decline, which was 2.0% in 2013 and continued to be in the reasonable range.  WT/TPR/M/300/Add.1 
 
- 361 - 
 
  
 Page 25 (Paragraph 1.38) 
 The Secretariat recalls that "In a most recent public evaluation of China's exchange rate, IMF 
Directors considered that a more market-based exchange rate system would facilitate further 
internal and external rebalancing".  
Question 
15. Does China plans to take measures toward s a more market-based exchange rate system?  
 
Answer 
In recent years, China has further improved the market-based RMB exchange rate formation 
m e c h a n i s m ,  g i v e n  p l a y  t o  r o l e  o f  m a r k e t  i n  e x c h a n g e  r a t e  f o r m a t i o n ,  e n h a n c e d  t h e  t w o - w a y  floating elasticity of RMB exchange rate and main tained RMB exchange rate basically stable at the 
level of reasonable equilibrium. The range of exch ange rate fluctuations was expanded to 2% on 
16 April 2012 and 15 March 2014, and the People's Ba nk of China basically withdrew from normal 
intervention into foreign exchange rate. In the future, China will continue to take measures towards a more market-based exchange rate formation mechanism, intensify effort in market-
decided exchange rate, strengthens the two-way fl oating elasticity of RMB exchange rate and 
maintain RMB exchange basically stable at  the level of reasonable equilibrium.  
 
Pages 26/27 (Paragraphs 1.41 and 1.42)  
 Question 
16. Which effects on trade does China expect after possible capital account liberalization and a 
market-determined exchange rate?  
 Answer 
There are many factors influencing foreign trade, including domestic and external demand, labour cost and product competiveness in addition to  exchange rate. Improved market-based RMB 
exchange rate formation mechanism and more bala nced RMB exchange rate will guide reasonable 
resource allocation between internal and extern al as well as trade goods and non-trade goods 
sectors, improve the efficiency of resource alloca tion and jointly promote balance of international 
payment together with structural policy.  
 
Page 31 (Paragraph 1.51)  
 
As mentioned above, the Government is trying to facilitate FDI inflows through the removal of 
restrictions, such as the revision of its Inve stment Catalogue and by simplifying procedures, 
including by eliminating verification requirements  in a number of cases (sections 2.5.1 and 2.5.2) 
It also seeks to attract further FDI through a number of incentive schemes (section 2.5.3) and 
through the more liberal rules applied to the CSPFTZ  (section 2.5.4).  
Question 
17. Which restrictions to inflows of FDI have been lifted since the last TPR?  
 
Answer 
China reduced and delegated the power of some investment examination and approval matters to 
local governments and cancelled examination and appr oval of "foreign cooperation contract on oil, 
natural gas and coal bed gas. We launched the reforms of industrial and commercial registration 
system including the change from the paid-in regi stered capital system into subscribed payment 
system and optimized foreign investment consultation registration system and process, set up the China (Shanghai) Pilot Free Trade Zone and issued  23 further opening measures in six sectors 
including financial services, shipping servic es, merchandising and trade related services, 
professional services, cultural services and soci al services. Moreover, China has explored the pre-
access management model of national treatmen t plus negative list for foreign investment, 
attempted to build a foreign investment management system suitable for China's actual conditions 
and new investment trend, further simplified fore ign investment approval process and promoted 
investment facilitation.   WT/TPR/M/300/Add.1 
 
- 362 - 
 
  
 2 - TRADE AND INVESTMENT REGIME 
 Page 36 (Para 2.8)  
 
Special Economic Zones may also develop regulations that can be applied in their jurisdiction. Local rules are published through Announcements of the local Congress. The Constitution and 
other relevant statutes clarify that local regulations must yield to regulations of higher status. The 
Legal Affairs Office of the State Council reviews local regulations and rules to ensure policy coherence.  
Question 
18. In case the local regulation confronts a hi gher regulation, does the State Council have the 
power to overturn the law immediately? If not, what is the applicable procedure? 
 
Answer 
To safeguard the unification of legal system, the Le gislation Law of the People's Republic of China 
formulated in 2000 explicitly rules that the power of laws and administrative regulations is higher 
than that of local laws, regulations and government rules. The Standing Committee of the National People's Congress has the right to overturn administrative laws and regulations conflicting the Constitution and laws as well as local laws and regulations conflicting the Constitution, laws and 
administrative laws and regulations. The State Council has the right to change or overturn 
impropriate department rules and local government rules, and the people's congresses of provinces, autonomous regions and municipalities directly under the central government have the 
right to change or overturn impropriate local laws and regulations that are developed and 
approved by their standing committee.   
Page 37 (Para 2.16)  
 Complaints from foreign-invested enterprises are handled by the Complaint Coordination Office for 
Foreign-invested Enterprises and the National Comp laint Centre for Foreign-invested Enterprises, 
both under MOFCOM. Data on actual complaints is not available.  
 Question 
19. What is the internal treatment given by Chin a to complaints submitted by foreign-invested 
enterprises?  
 
Answer 
The National Complaint Centre for Foreign-invest ed Enterprises and local government departments 
at all levels handle complaints submitted by fore ign-invested enterprises. The National Complaint 
Centre for Foreign-invested Enterprises handles co mplaints directly submitted by foreign-invested 
enterprises as well as cross-provincial and cross-municipal complaints and important complaints 
submitted by foreign-funded enterprises. Local co mplaint authorities handle complaints submitted 
by local foreign-funded enterprises as well as comp laints that are transferred or supervised by the 
National Complaint Centre for Foreign-invested Enterprises. The process of compliant handling 
including complaint material review, compliant acce ptance registration, notice to the defendant, 
complaint handling, notice of handling results to the compliant and settlement registration. A complaint is handled by issuing opinions, making  administrative coordination with departments 
concerned, transferring to local complaint authority or transferring to department concerned.  
 Question 
20. Does the Complaint Coordination Office for Foreign-invested Enterprises and the National 
Complaint Centre for Foreign-invested Enterprises have the formal obligation to provide any feedback to enterprises concerning the submitted complaints?  
 WT/TPR/M/300/Add.1 
 
- 363 - 
 
  
 Answer 
The Complaint Coordination Office for Foreign-invested Enterprises coordinates, guides and 
supervises the work of the National Complaint Centre for Foreign-invested Enterprises instead of 
directly handling enterprise complaints. The Na tional Complaint Centre for Foreign-invested 
Enterprises handles complaints directly submitted by foreign-invested enterprises as well as cross-provincial and cross-municipal complaints and im portant complaints submitted by foreign-funded 
enterprises, provides feedback information and ma kes coordination based on investigation results 
after a complaint is handled.   Page 37 (Paragraph 2.16) 
 
Question 21. What is the administrative procedure that foll ows a complaint by a foreign-invested enterprise 
to the Complaint Coordination Office for Foreign-invested Enterprises and the National Centre for 
Foreign-invested Enterprises? What happens when the complaint involves other agencies of the Chinese Government?   
Answer 
The process of compliant handling including complaint material review, compliant acceptance 
registration, notice to the defendant, complain t handling, notice of handling results to the 
compliant and settlement registration. If a compliant involves other departments, administrative coordination will be made with the departments concerned and the compliant will be transferred to 
the department concerned.  
 Page 37 (Paragraph 2.17) 
According to the Secretariat, "The National Development and Reform Commission (NDRC) is in 
charge of devising the overall national economic and social development policy. The NDRC is also 
responsible for: conducting research and setting objectives and policies on economic reform and 
liberalization; and the planning of inbound and outbound investment".  
 
Question 22. Could China explain how NDRC plans the inbound and outbound investment, including the list 
of instruments used and the goals established? 
 Answer 
In general, pursuant to the Decision of the State Council on Reforming the Investment System issued in 2004, the NDRC conducts administration and provides services main ly in accordance with 
the Catalogue of Investment Projects Approved by the Government, the Catalogue of Industries for Guiding Foreign Investment as well as the Measures for the Administration of Investment 
Projects Approved by Governments and the Admi nistrative Measures for the Confirmation and 
Recordation of Foreign-Funded Projects issued by the NDRC.   
Regarding foreign investment, the Twelfth Five-Y ear Plan for Foreign Investment Utilization and 
Overseas Investment issued by the NDRC in July 2012 is an important guided for foreign 
investment utilization and overseas investment work during the period of the Twelfth Five-Year 
Plan. The Chinese Government optimizes the environment for foreign investment by strengthening 
the guidance on foreign investment and overseas investment, improves supporting facilitation measures, and encourages and guides domestic and foreign enterprises to make orderly investment by following the principles of market orientation, mutual benefit and win-win result. 
Meanwhile, we also constantly improve the level of  inbound and outbound investment facilitation, 
safeguard overseas rights and interests of Chines e and foreign enterprises and guard against risks 
of all types.  
 
In December 2013, the State Council issued the Notice of the State Council on Issuing the Catalogue of Investment Projects Subject to the Approval of Government (2013) to stipulate the 
scope of foreign-invested projects to be approved. In May 2013, the NDRC issued the 
Administrative Measures for the Confirmation an d Recordation of Foreign-Funded Projects to 
change comprehensive project management into  the management of limited approval and 
common registration and explicitly define the cont ents, documents, conditions and procedures of 
project approval.  WT/TPR/M/300/Add.1 
 
- 364 - 
 
  
 Question 
23. What kind of commercial transactions re quire the approval of the NDRC? What are the 
requirements and procedures for approval?  
 
Answer 
Please see answer to question 22.  
 
Pages 38/39 (Paragraphs 2.21 and 2.22)  Question 
24. Could China provide further information on measures taken so far to comply with the Decision 
on Major Issues Concerning Comprehensively Deepening Reform, issued by the 18
th National 
Congress of the Communist Party of China in the following areas: 
 
(i) trading regulations; (ii) investment regime; 
(iii) implementation of free trade agreements; 
(iv) implementation of the Shanghai Pilot Free Trade Zone; (v) opening up of inland and border areas.  
Answer 
Foreign trade: 
(1) China raised the level of trade facilitation.  We further optimized the method and way of 
regulation, improved the pertinence and effectiveness of customs inspection, carried forward pilot 
integrated regional customs clearance, launched paperless customs clearance and accelerated customs clearance. Moreover, China accelerated the construction of electronic ports, implemented 
"single window" international trade handling, pr omoted "one-time declaration, inspection and 
release" in an all-round way and realized information sharing between port departments and local governments. We further reduced items requiring administrative approval, simplified procedures 
and decreased the classifications of exported goods for inspection. We rectified and standardized 
export business services and charges and relieved  burdens on enterprises. (2) China improved 
processing trade, amended the catalogues of goods prohibited or restricted for processing trade, improved processing trade policy, innovated the model of processing trade and intensified effort in 
transferring processing trade gradient to form a new pattern of transformation and upgrading in 
the coastal areas and orderly undertaking in the inland areas.   
Further opening-up of inland and border areas:  
China grasped the opportunity of global industrial re-layout and promoted the coordinated development of trade, investment and technologica l innovation in inland areas. We innovated the 
model of processing trade to form system and mechanisms that help promote the development of 
industrial clusters in inland areas, supported inland cities to open international passenger and 
cargo liner routes and develop multiple joint transport to form a well-connected external economic corridor, carried forward customs clearance collaboration between inland and coastal areas to 
realize mutual information exchange, mutual supervision recognition and mutual assistance in law 
enforcement among port authorities concerned. In addition, we accelerated the pace of the 
opening up of border areas and allowed special ways and policies in personnel exchange, 
processing logistics and tourism by key border ports, border cities and economic cooperation 
zones. We set up development-based financial institutions, accelerated the construction of mutual infrastructure connection with neighboring countries and regions and facilitated the construction of the Silk Road Economic Belt and the Marine Silk Road to form a new all-round pattern of opening 
up.  
 Free trade agreement: 
As stated in the Decision on Several Important Issues Concerning Comprehensively Deepening 
Reform, "We will accelerate the implementation of  free trade zone strategy based on neighboring 
countries, speed up negotiation on new topics including environmental protection, investment 
protection, government procurement and e-commerce to form a global high-standard free trade 
zone network."  WT/TPR/M/300/Add.1 
 
- 365 - 
 
  
 Investment regime reform: 
The Decision proposed to "strike a balance between government and market and give play to the d e c i s i ve  rol e p l aye d  b y marke t i n re s ourc e  al l oc ati on and  g i ve  b e tte r p l ay to g ove rnm e nt". T he 
investment regime reform mainly focuses on establishing the status of enterprises as investment 
subjects and transforming government function of investment administration. China established 
the status of enterprises as investment subjects to  give enterprises fuller decision making power in 
projects, and transformed government function in investment administration to realize high-
efficiency service and administration and simp lify the content and procedure of government 
approval for projects.   
In December 2013, the State Council issued the Notice of the State Council on Issuing the 
Catalogue of Investment Projects Subject to the Approval of Government (2013) to stipulate the 
scope of foreign-invested projects to be approved. In May 2013, the NDRC issued the 
Administrative Measures for the Confirmation an d Recordation of Foreign-Funded Projects to 
change comprehensive project management into  the management of limited approval and 
common registration, explore pilot national treatment for access management of foreign 
investment, significantly narrow the scope of projec ts to be approved, further simplify the content 
and procedure of foreign-funded investment proj ect management and highlight the subject status 
of foreign-invested enterprises.   
Page 39 (Paragraph 2.25)  
 Question 
25. Regarding the Shanghai Pilot Free Trade Zone, how often the Chinese authorities intend to 
revise the Negative List?  
 
Answer  
China has revised the Negative List when deemed appropriate according to actual conditions.  
 Page 39 (Para 2.22) 
 
The different departments of MOFCOM are in charge of aspects of trade and commercial policy reform. The changes envisaged include: (a) prom oting a reform of the domestic trading and 
circulation system through are form of trading regulations and the strengthening of the legal 
environment for business; (b) a reform of the investment regime (inward and outward) to make it more open, transparent and predictable; (c) an ac celeration of the implementation of free-trade 
agreements; (d) the acceleration of the development of the China (Shanghai) Pilot Free Trade 
Zone (CSPFTZ);and (e) the acceleration of reform geared to opening up inland and border areas.  
 Question 
26. Has China set a timeframe to conduct the trade and commercial policy reform? 
 Answer 
According to the requirements and deployments of the Third Plenum of the 18th National Congress 
of the Communist Party of China, the Chinese Government is accelerating improving modern market system and building unified, open and or derly competitive market system which is the 
foundation for the market to play a decisive role in resource allocation. China has built fair, open 
and transparent market rules, improved the mechanism of market determining price, established 
unified construction land market in urban and rural areas, improved financial market system and deepened the reform of scientific and technologica l reform. At present, various reform measures 
are being advanced in a solid way.  
 Page 40 (Paragraph 2.38) 
 
Question 27. Apparently, the new China-Switzerland FTA, which should come into force in 2014, brings some innovations vis-à-vis previous FTAs signed by China. Could the Chinese delegation elaborate 
on that?  
 WT/TPR/M/300/Add.1 
 
- 366 - 
 
  
 Answer 
The China-Switzerland FTA is one of highest-level and most comprehensive FATs that is reached 
by China with foreign countries in recent years and has the following characteristics:  
 
First, high proportion of zero tariff for trade in goods. Switzerland will promptly grant zero tariff to 
99.7% of China's exports, while China will finally impose zero tariff on 84.2% of Switzerland's 
exports. Plus some products of tax reduction, the proportion of Switzerland's products for tax 
reduction is 99.99% and that of China is 96.5%.   Second, many new rules are involved. China and Switzerland have reached many consensuses on 
rule issues that are rarely confronted China in  previous FAT negotiations such as government 
procurement, environment, labour and employment  cooperation, intellectual property right and 
competition by following the principle of seekin g common points while reserving difference. For 
instance, China agreed for the first time to inde pendently set forth a character for environmental 
issues in the FAT and explicitly stipulated the spec ific rights and obligations of intellectual property 
right protection to enhance the transparency and facilitation of right holder protection.  
 
Pages 40/41 (Paragraph 2.39)  
 
China is currently negotiating FTAs with the Gulf Cooperation Council (GCC) countries, Australia; 
Norway; Korea, the Republic of and Japan. Nego tiations for a Regional Comprehensive Economic 
Partnership (RCEP) between ASEAN Members, Australia, China, India, Korea, the Republic of, 
Japan, and New Zealand were launched at the 21st ASEAN Summit in November 2012. 
 Question 
28. Could China update WTO members on the current stage of the FTA negotiations in which the 
country is involved?  
 
Answer 
China is currently negotiating six FTAs with Kore a, GCC, Australia, Norway as well as China-Japan 
-Korea Free Trade Zone and RCEP. The updates are as follows:  (1) China-Korea FAT negotiation was officially launched in May 2012 and witnessed 11 rounds of negotiation to date.  
(2) China- GCC FAT negotiation was launched in July 2004 and witnessed five rounds of 
negotiations and two working group meetings on trade in goods to date.  (3) China-Australia AFT negotiation was launched in April 2005 and witnessed 20 rounds of 
negotiations to date. 
(4) China-Japan-Korea FAT negotiation was officially launched in December 2011 and witnessed four rounds of negotiations to date. The fifth round of negotiation will be held in early August in 
China.  
(5) RCEP negotiation was launched in November 2012  and witnessed five rounds of negotiation to 
date.  (6) China-Norway FAT negotiation was officially launched in September 2008 and witnessed eight 
rounds of negotiations to date.  
 Page 42 (Paragraph 2.43)  
 
The main laws specifically related to foreign-invested enterprises (FIEs) in China include the 
following: the Law on Sino-Foreign Equity Joint Ventures; the Law on Sino-Foreign Cooperative 
Joint Ventures; the Law on Wholly Foreign-Owned En terprises; the Law on Partnership Enterprises; 
and their related administrative regulations and rules. During the period under review, the regulatory framework underwent significant change s, as broadly reflected in the State Council's 
Circular No. 47 of 13 December 2013 (GuoFa [2013] No. 47), or State Council Circular on 
releasing the Catalogue of Investment Projects Subject to Government Verification, 2013 version. Other changes include the revision of the Compan y Law (Order of the President of the People's 
Republic of China No.8, issued on 28 December, 2013).  
 Question 29. Could China provide further information on the changes to investment regime during the 
period under review, especially regarding State Council Circular nr.47/2013?  WT/TPR/M/300/Add.1 
 
- 367 - 
 
  
 Answer 
In December 2013, the State Council issued the Notice of the State Council on Issuing the 
Catalogue of Investment Projects Subject to th e Approval of Government (2013 version) to 
streamline administration and delegate power to the lower levels and stipulate the scope of 
foreign-invested projects to be approved. In May 2014, the NDRC issued the Administrative Measures for the Confirmation and Recordatio n of Foreign-Funded Projects to change 
comprehensive project management into the management of limited approval and common 
registration, explore pilot national treatment for access management of foreign investment, significantly narrow the scope of projects to be approved, further simplify the content and 
procedure of foreign-funded investment project management and highlight the subject status of 
foreign-invested enterprises.  
 Page 43 (Paragraph 2.47)  
 
Projects in the "encouraged" category are eligible  for preferential treatment as specified in the 
relevant laws and regulations. They may enjoy customs duty and VAT exemption on the 
importation of capital goods. Projects in the restricted category must undergo a more thorough examination and approval process.   
According to Paragraph 2.47 of the Report by th e Secretariat, investments in the "encouraged" 
category are eligible for preferential treatment and tax benefits such as customs duty and VAT exemption on the importation of capital goods. Could China provide further on this topic, such as:  
 
Question 
30. Which are the laws and regulations that set forth these tax benefits?  
 
Answer 
The Notice of the State Council on Adjustment of Imported Equipment Taxation Policies (Guo Fa 
[1997] No.37) and the Announcement of the Ministry of Finance, General Administration of Customs and State Administration of Taxation ([2008] No.43) set forth these tax benefits.   
Question 
31. How can a company apply to these benefits? What are the governmental agencies concerned? 
 
Answer 
See relevant provisions in the Emergency Notice of General Administration of Customs on 
Implementation of Notice of State Council on Ad justment of Tax Policy of Imported Equipment 
(Shu Shui [1997] No. 1062) for the methods by which enterprises apply for these benefits. It 
involves the National Development and Reform Commission, the Ministry of Commerce, the 
General Administration of Customs and so on.   
Question 
32. How many companies currently enjoy these benefits? What was the total fiscal impact of those tax benefits during the period under review  in terms of government revenue losses?  
 
Answer 
Now, we do not have the data on the number of enterprises which enjoy these benefits. These tax 
benefits reduce certain financial revenue, but the specific financial influences on the reduction of 
government revenue are not evaluated. 
 Page 44 (Paragraph 2.52)  
 
The Secretariat states that "In addition to anti-trust reviews, FDI involving M&As with Chinese 
domestic enterprises is subject to national security reviews, if the FDI is related to defence, or is 
deemed to have an influence on national security, for example through control of firms engaged in 
activities involving key commodities (e.g. agriculture, energy, and natural resources), key 
infrastructure, key transport, and key equipment manufacturing with essential technologies."  
 WT/TPR/M/300/Add.1 
 
- 368 - 
 
  
 Question 
33. Could China explain why agriculture is associated  with national security and subject to national 
security reviews?  
 
Answer 
China is a traditional agricultural country, agriculture is a basic industry in China, and relevant 
industries occupy an important place in the nation al economy. According to the Notice of General 
Office of the State Council on Establishing Safety  Censorship against Foreign Investors' Merging 
and Acquiring Domestic Enterprises (Guo Ban Fa [2011] No. 6), if foreign investors merge and acquire domestic important agricultural produc ts production and operation enterprises which 
concern national security and de facto control coul d be obtained by foreign investors, such merger 
and acquisition must be censored for security.  
Page 44 (Paragraph 2.53)  
 
In 2013, the authorities issued some Guiding Opin ions encouraging companies operating in some 
key industries to increase their merger and reor ganization activities in order to improve their 
efficiency and global competitiveness. The targeted industries are: automobiles, steel, cement, shipbuilding, electrolytic aluminium, rare earth, electronic information, pharmaceuticals, and 
agricultural industrialization. For some of these industries, the Guiding Opinions set targets in 
terms of the degree of concentration to be re ached by 2015. The legislation also encourages 
foreign investors to participate in domestic enterprises through share participation, mergers and 
acquisitions.  
 Question 
34. Could China provide further information on the Guiding Opinions to encourage consolidation in 
the targeted industries mentioned in Paragraph 2.53? What is the target in terms of degree of concentration to be reached in 2015 in the areas automobiles, steel, cement, shipbuilding, electrolytic aluminum, rare earth, electronic information, pharmaceuticals and agricultural 
industrialization? What would be the participation allowed to foreign investors in each of those 
industries?  
 
Answer 
The Ministry of Industry and Information Technolo gy together with 12 member units of the inter-
ministerial coordination group of corporate mergers and acquisitions work jointly issued the 
Guidance on Accelerating Mergers, Acquisitions and Reconstructions of Important Industries and 
Enterprises (hereinafter referred to as the Gu idance) in January 2013. The Guidance proposes 
opinions on the mergers, acquisitions and reconstructions of corporate champions in the auto, steel, cement, ship, electrolytic aluminium, rare ea rths, electronic information, medicine industries 
and industrialization of agriculture. The Guidance does not involve any special supportive policy. At 
the same time, the Guidance insists on the principl e of treating the domestic and foreign investors 
equally. It also support foreign investors to participate in mergers, acquisitions and reconstructions 
of domestic enterprises in plenty of means. 
 Page 45 (Paragraphs 2.55 and 2.56)  
 
In paragraph 2.55 of the Secretariat Report, it is mentioned that "in accordance with the Circular, 
as of 13 December 2013, there are two categories of investment projects depending on their required modality of registration: (a) projects subjec t to verification; (b) projects subject to filing." 
 
Question 35. Are all foreign-invested fixed asset investment projects in China necessarily included in one of 
these two categories of examination and approval procedures (verification or filing)? Are there 
projects subjected to different sets of registration requirements?  
 
Question 
36. Investment projects in an Export Processing Zone follow under which of these two categories, if any? 
 WT/TPR/M/300/Add.1 
 
- 369 - 
 
  
 Question 
37. Investment projects in the automotive manufac turing sector follow under which of these two 
categories, if any?  
 
Question 
38. Please provide a list of all steps (in the national, provincial and local levels) involved in the examination and approval procedure for the estab lishment of an automotive plant in an Export 
Processing Zone.  
 
Question 
39. What is the timeframes for these approval processes?  
 
Question 
40. In relation to items (iv) and (v), please provide the specific provisions in all the relevant pieces of legislation where such steps can be found.  
 
Answer to questions 35-40) 
In December 2013, the State Council released the Notice of State Council on Releasing Investment 
Project Catalogue for Government Verification (2 013 version), which stipulates and defines the 
scope of foreign-invested projects required for verification. In May 2014, the National 
Development and Reform Commission released the Verification and Approval of Foreign-invested Projects Tentative Administrative Procedures (promulgated on the official website of the National 
Development and Reform Commission), which takes effect on 17 June and is applicable to all kinds 
of foreign-invested projects such as the merger s, acquisitions and reconstructions of domestic 
enterprises by Sino-foreign joint ventures, Sino-f oreign co-operative joint venture enterprises, 
exclusively foreign-owned enterprises and foreign merchants. The foreign-invested projects shall 
perform the verification and filing procedures in  accordance with relevant regulations. Now, 
automotive manufacturing project performs inve stment management in accordance with the 
Automobile Industry Development Policy approved by the State Council, but the projects which are 
invested to manufacture cars and vehicle engines for export in the Export Processing Zone may 
not be constrained by such policy and are required to be reported to the State Council for special examination and approval. Relevant provisions of  the Automobile Industry Development Policy and 
the Automobile Industry Development Policy detailed  stipulate the steps of verification or filing 
procedures required to be performed by foreign investment in auto industry. The project unit may contact local competent investment authority to validate the progress of submission and 
verification procedures of project application materials. In next step, we will promote the 
construction of project online query system to further improve the degree of investment facilitation.  
Page 46 (Paragraph 2.57)  
 In paragraph 2.57 of the Secretariat Report, it is  mentioned that "the NDRC had already drafted 
administrative measures for the verification and filing of foreign-invested projects and had 
completed the process of public consultation online, including the one-month period for comments. The authorities noted that the NDRC would publis h the administrative measures after introducing 
the pertinent modifications."  
 Question 41. Are the above mentioned administrative measures  for verification and filing already in force? 
Please provide a web link to all these administrative measures.  
 Question 
42. According to the abovementioned administrative procedures, how can a foreign investor prove 
that its investment project has been submitted for registration? Is the receiving authority obliged to issue any sort of documentation attesting the investment project has been submitted for 
registration? Is this a numbered document?  
 Question 43. How can the investor follow up on the progress  of the examination and approval procedures of  
 WT/TPR/M/300/Add.1 
 
- 370 - 
 
  
 Answer to Questions 41-43 
In May 2014, the National Development and Reform Commission released the Verification and 
Approval of Foreign-invested Projects Tentative Administrative Procedures (promulgated on the 
official website of the National Development and Reform Commission), which takes effect on 
17 June. See website: http://www.sdpc.gov.cn/gz dt/201405/t201405 20_612256.html for specific 
information. 
 
Page 47 (Para 2.64)  
 Some provinces, autonomous regions and municipalities directly under the Central Government 
have established one-stop services to help foreign investors with the approval and registration 
process.   
Question 
44. Has China planned to expand the implementati on of one-stop services to other regions and 
municipalities?  
 
Answer 
Some local governments integrate the local government departments for transaction of formalities 
of examination, approval, registration and enrollm ent into one-stop services platform, which is 
beneficial to reducing time for investment exam ination and approval and improving the level of 
investment facilitation, but whether the one-stop services shall be set up is determined by all 
regions according to actual demands. Chinese central government encourages and supports all 
regions to continuously optimize examination an d approval procedures and ceaselessly perfect  
investment environment and provide more quality public services to all kinds of investors including foreign investors.  
Question 
45. Is China considering to implement one-stop services at the national level?  
 
Answer 
Chinese government is committed to building efficient and convenient investment management 
environment, simplifying transaction procedures an d continuously improving degree of investment 
facilitation. The one-step services in all regions is a creative administrative management mode 
adopted independently by the local governments, which shall be encouraged.   Page 47 (Paragraph 2.65)  
 
According to the Secretariat, "Since 2005, China`s outward FDI flows have been rapidly 
increasing, reflecting stronger policy support to the country's Going Global strategy". 
 
Question 46. Could China detail the measures that were taken to strengthen, since 2005, the country`s 
Going Global strategy?  
 Answer 
Policies for "Going Global" strategy include (1) simplifying the examination and approval of foreign 
investment and perfecting supervision and manageme nt such as further delegating the verification 
authority of establishment of enterprises by ov erseas investment to lower levels, simplifying 
verification formalities and further specifying and simplifying the formalities of examination and 
approval of labors' going abroad etc.; (2) simp lifying formalities and loosing exchange control 
against foreign investment; (3) public services.   WT/TPR/M/300/Add.1 
 
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 Pages 48/49 (Paragraph 2.69)  
 
Incentive measures applicable to foreign investments take mainly one of the following forms:  
a. encouraged items in the Catalogue for the Guidance of Foreign Investment Industries (see Table 2.2), and projects in the Catalogue of Priority Industries for Foreign Investment in the 
Central-Western Regions of China (latest amendment in 2013);  
b. duty-free treatment for equipment imported within the total investment amount for self use; and,  c. Preferential tax treatment provided under the Enterprise Income Tax Law (Table 2.4).  
 
Question 47. Could China provide further information on the incentives to foreign investment, especially 
duty-free treatment for equipment imported and tax benefits? What kind of investment is eligible 
to this sort of treatment?  
 
Answer 
In accordance with relevant provisions, for foreign-invested projects which are encouraged in the 
Catalogue of Encouraged Industries for Foreign Investment, the customs duty of self-use equipment imported within aggregate investment shall be exempted except for the commodities 
listed in the Catalogue of Non-Duty-Free Commodities  to be Imported for foreign-funded projects. 
 Page 51 (Paragraph 2.80)   
With regards the CSPFTZ, the Secretariat informs that "89 financial companies were established 
during the period mentioned above (between th e date of inauguration, 29 September 2013, and 
mid-February 2014), and 34 financial leasing companies".  
 
Question 48. Could China list the advantages that financial companies enjoy when they open branches at 
the CSPFTZ?  
 Answer 
The advantages for opening branches at the CSPFTZ are as follows: Firstly, financial sector is the 
one of the major sectors for opening up at the CSPFTZ, which provides opportunities for the 
entries of foreign invested financial institutions into CSPFTZ in terms of market access; secondly, 
the institutional framework for opening and innovati on in the area of financial service has been 
basically formed at the CSPFTZ. Five institutional innovation involving establishment of system for 
free trade accounts, foreign exchange facilitation fo r investment and financing, expansion of cross 
board RMB utilization, the pilot program for market- oriented interest rate, and the reform of 
foreign exchange management provides opportuni ties for business innovation and expansion. 
 Page 51 (Para 3.78)   
The authorities indicated that the launching of the CSPFTZ is a national strategy to deepen 
reforms. Since it is a Pilot Zone, policies will be tested in the Zone and this will serve as a showcase for further trade and investment liberalization nationwide. The authorities also indicated 
that Shanghai was chosen because it had traditionally been at the forefront of China's reform 
policies. The CSPFTZ is meant to expand and op en up the service sectors and to reform the 
investment administration mechanism, push forw ard trade transformation, deepen the opening up 
of financial services, and create a new mode of supervision and service.  
 Question 49. Does the CSPFTZ intend to impulse specific service sectors?  
 
Answer 
In accordance with the implementations of the meas ures for opening up of service industry defined 
in the Framework Plan for the China (Shanghai) Pilot Free Trade Zone and 2013 version of 
negative list, Shanghai actively strives for supports of relevant national ministries and 
commissions and is studying in proposing furt her measures for opening up of the CSPFTZ. 
 WT/TPR/M/300/Add.1 
 
- 372 - 
 
  
 Question 
50. Is there a specific methodology to assess th e results of the implementation of trade and 
investment policies in the Pilot Zone? 
 
Answer 
Half a year after the establishment of CSPFTZ, research institutions including the Research Center 
for Development under the State Council, the Research Center for development under the 
Shanghai municipal government initiated internal evaluation for the operation of CSPFTZ. At the 
meantime, several industry associations, representa tive offices of foreign countries in China also 
carried out evaluation for the operation of CSPFTZ from different perspective. All of the evaluation 
reports confirmed the achievement for the establis hment of CSPFTZ and the initial formation of 
basic institutional framework for rules concerning cross board investment and trade in line with the 
requirement of internationalization and rule of law. At the meantime, reports gave some 
suggestions including creating sound atmosphere wi th reform in a more autonomous way, further 
improve negative list and extend more areas for opening up, etc. The Shanghai municipal government is intended to invite the third instit ution both at home and abroad to make external 
evaluation on the operation one year after the establishment of CSPFTZ and will release the results 
to general public in an appropriate manner.  Question 
51. When will the first results be availabl e and are there plans to make them public?  
 Question 
52. Is China considering implementing similar Pilot Zones in its territory?  
 Answer 
Chinese government now has approved the CSPFTZ to promote the reform and opening up of the country to form reproducible and propagable experience. Whether similar test will be performed in other regions is required to be studied and considered in accordance with demands for further promotion of reform and opening up of the country  and on the basis of evaluation of the CSPFTZ. 
 
Question 53. Has China set a timeframe after which it will be in a position to assess the convenience of 
further liberalization nationwide?  
 Answer 
The CSPFTZ plans to use 3 years to explore new roads and new modes for the comprehensively deepening of reform and opening up in China. If the relevant experience gained by Shanghai can 
be publicized to other regions of the country after it  is evaluated, then it will be publicized to other 
regions of the country. If relevant practices and te sts are proved to be feasible within 3 years, 
they may be publicized to other regions of the country at first. 
 3 - TRADE POLICIES AND PRACTICES BY MEASURE  
 
Page 62 (Paragraph 3.22)   
In paragraph 3.22 of the Secretary Report, it is mentioned that "agricultural products sold directly 
by the producer continue to be exempted from VAT, while imported goods are not."   Question 
54. Please explain how this difference in trea tment between domestic and imported goods is 
compatible with the provisions of the GATT.  
 
Answer 
To exempt VAT of self-produced agricultural produc ts selled by agricultural producers mainly is to 
facilitate the collection and management of VAT under conditions of family-contract and decentralized operation implemented by agricultur e in China. Usually, agricultural products are 
required to pass through the circulation links to reach consumers. China levies taxes on  
agricultural products in circulation links, so levying taxes on imported agricultural products does not involve the issues of discrimination treatment.  WT/TPR/M/300/Add.1 
 
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 Page 64 (Paragraphs 3.24 to 3.31)  
 Import prohibitions, restrictions and licensing  
 
In what concerns the sales of commercial aircrafts to China, please provide the following clarifications: 
 
Question 55. What are the applicable licensing procedures?  
 
Answer 
Now, relevant procedure of introduction of aircrafts of Chinese airlines is: introduction of aircrafts 
of airlines is required to apply to the Civil Avia tion Administration of China (CAAC); CAAC evaluates 
the airlines in aspects such as safety etc.; after they pass the evaluations, the CAAC will report to 
the National Development and Reform Commission  for verification. When applicants submit 
materials, they are not required to provide purchase contract of aircrafts.  
Question 
56. Please provide a list of the regulatory procedur es involved in the sale of commercial aircrafts to 
China. 
 
Question 57. Are the buyer and/or the seller required to submit the purchase contract for approval by the 
sector regulator?  
 Question 58. How can the buyer and/or the seller prove that  the purchase contract has been submitted for 
approval by the sector regulator? Is the regu latory authority obliged to issue any sort of 
documentation attesting the contract has been submitted for approval? Is this a numbered document?  
 
Question 59. What is the role of the National Development and Reform Commission in the sale of 
commercial aircrafts to China?  
 
Question 
60. Is the buyer and/or the seller required to su bmit the purchase contract for approval by the 
NDRC?  
 Question 61. How can the buyer and/or the seller prove that  the purchase contract has been submitted for 
approval? Is the NDRC obliged to issue any sort of documentation attesting the contract has been 
submitted for approval? Is this a numbered document?   
Question 
62. How can the buyer and/or the seller prove that  the contract has been submitted for approval 
by the NDRC? Is the regulatory authority obliged to issue any sort of documentation attesting the 
purchase contract has been submitted for approval? Is this a numbered document?  
 Question 63. How can the seller follow up on the progre ss of the approval procedures of the purchase 
contract? Is there an online system in place where such information can be found? 
 Question 
64. How are such additional requirements involved in the purchase of commercial aircrafts by 
Chinese airlines compatible with the provisions of the GATT?   
Answer for questions 59 to 64 
Introduction and retirement of aircrafts are the market behaviours made by enterprises in 
accordance with the aviation market situation and requirements of enterprise development. At the WT/TPR/M/300/Add.1 
 
- 374 - 
 
  
 same time, growth and development of fleet are also required to follow national policies relevant 
to safety and industry regulation. The Governme nt mainly plays its role in terms of safety 
regulation and guiding the industry toward orde rly and healthy development. Introduction of 
aircrafts of airlines is required to apply to the CAAC. The CAAC examines and approves their safety 
capability from the perspective of industry regulati on and issues certificates such as nationality 
registration certificate and certificate of seaworthiness etc. So, the regulation and licensing of 
enterprise (airlines) at the government-level lie  in the CAAC. NDRC and the CAAC belong to 
d i f f e r e n t  d i v i s i o n  o f  w o r k  w i t h i n  g o v e r n m e n t  a f f a i r s .  T h e  N a t i o n a l  D e v e l o p m e n t  a n d  R e f o r m  Commission (NDRC) mainly establishes the marco policy of aviation development and guides and coordinates the coordinated development of integrat ed transportation system to ensure that the 
fleet development adapt to the auxiliary security ca pability such as airports and air traffic control 
and the capacity of aviation market. The NDRC do es not accept the application of airlines for 
introduction of aircraft and does not examine and approve the purchase contract of aircraft. In 
addition, introduction of aircrafts by aircraft leasing enterprises is not required to be reported to 
the government for examination and approval.  
Page 65 (Paragraph 3.30)  
China's legislation also allows the authorities to restrict imports to allow for the establishment of a particular domestic industry or to accelerate its development. Imports of agricultural, animal and fish products may also be restricted if the circumstances so require (Article 16 of the Foreign Trade 
Law). According to the authorities, this provision has never been used.  
 Question 
65. Could China elaborate on the possibility of restricting imports to allow for the establishment of 
a particular domestic industry? In which circumstances, imports of agricultural, animal and fish products can be restricted?  
 
Answer 
Now, China does not apply import restriction measures for such purpose. 
 
Page 68 (Paragraph 3.43)  
 
China's anti-dumping legal framework contains specific rules on sampling. Although MOFCOM shall 
normally, on the basis of a full-scale investigation, determine a separate margin of dumping for 
each individual responding exporter or producer, it may carry out its investigation by using a sampling method when the number of exporters, produc ers, types of products or transactions is so 
large that it would be unduly burdensome and prevent the timely completion of the investigation. 
MOFCOM is responsible for deciding on the selection of exporters and producers for the sample and for the reserve list, after which it must notify  each interested party, giving seven days for 
comments. Only the selected exporters or producers will receive the questionnaire to be used for 
the investigation. However, the exporters and producers on the reserve list may provide information to MOFCOM on a voluntary basis. MOFCOM determines a separate margin of dumping for each individual exporter and producer sele cted in the sample. The margin of dumping for 
responding exporters and producers who are not su bject to individual examination is determined 
on the basis of the weighted average margin of  dumping determined for the sampled exporters 
and producers, calculated excluding zero or de minimis  (less than 2%) margins of dumping.  
 
Question 66. Could China provide further information on the calculation of the "all-others" rate, applicable to 
non-responding exporters? What is the procedure adopted by MOFCOM to determine the "all-
others rate"?  
 Answer 
Determination of rate of "other companies" de pends on the situations faced by the Chinese 
investigation authorities and the information obtained in the investigations. If sampling is adopted, then the rate of "other companies" is the weig hted average of the rates of enterprises being 
sampled. If sampling is not adopted, then the rate  of "other companies" depends on the situations 
of information available to the investigating authority. The sources of information which may be used by the investigating authority include cooper ating companies in the investigations, applicants 
and customs data etc. WT/TPR/M/300/Add.1 
 
- 375 - 
 
  
 Page 71/72 (Paragraphs 3.54 to 3.58)  
 Question 
67. Please provide all the cases in which China has applied antidumping duties and countervailing 
measures for the same product ("double remedy"). Does China have legislation in place to avoid the occurrence of double counting in such cases?  
 
Answer 
Cases in which China levies anti-dumping duties and countervailing duty on the same product 
include the potato starch and polycrystalline silico n cases filed against the European Union and the 
oriented electrical steel, white feather broiler, certain cars and polycrystalline silicon cases filed 
against the US. Double calculation mainly generate s from adopting method of "double substitution" 
to calculate the dumping margin and the amount of subsidy for a non-market economy while 
initiating anti-dumping and countervailing investigations simultaneously. In accordance with 
relevant provisions in the Anti-Dumping Agreement of WTO, Chinese investigating authority will perform relevant obligations to avoid the occurrence of double counting.  
Page 71 (Paragraph 3.55)  
 In paragraph 3.55 of the Secretariat report, it is mentioned that "The procedures for the conduct 
of countervailing (CV) investigations are in general similar to those described foranti-dumping 
investigations, although there are a few differences. One main difference is the involvement of the Government of the exporting country or territory in the investigations, through a process of 
consultations or by answering the CV questionnaire. These consultations must take place before 
the investigation is initiated. MOFCOM must invite the Government of the exporting country or territory to engage in consultations to clarify the issue and seek a mutually agreeable solution; if a solution is found, MOFCOM may decide not to initiate an investigation. The period for consultations 
must not exceed 60 days. Other differences include the absence of published rules for the use of 
sampling, and to conduct interim or judicial reviews. Also, there are no provisions to regulate the use of price undertakings to settle a CV investigation".  
 
Question 68. Please provide information on instances in which the involvement of the government of the 
exporting country has resulted in a mutually agreeable solution.  
 
Answer 
So far, there is no anti-subsidy cases se ttled by negotiation before initiation.  
 
Question 69. Is it possible for both parties to reach a mutu ally agreeable solution after a CV determination 
has been made?  
 
Answer 
There are no relevant provisions in the Chinese laws and regulations. In practice, under conditions 
of not violating relevant laws and regulations, it is possible that the industries of exporting 
countries and the domestic industries of China arrive at solutions with consensus.  
Page 77 (Paragraph 3.79 
 Question 70. Could China provide further information on the step-by-step procedures observed by its 
sanitary agencies, such as AQSIQ, to assess re quests for lifting import bans based on SPS 
grounds? What is the timeframe to complete each stage of the analysis on these cases?  
 
Answer 
After measures for banning import of animals and plants and their products are implemented, 
China will, according to relevant provisions of SPS agreement, timely notify trade partners of 
situations such as the product upon which the measures for banning import are implemented, the 
scope involved and the cause of prohibition by SPS national points of contact, and provide 
corresponding technical bases upon request of trad e partners. After relevant countries or regions WT/TPR/M/300/Add.1 
 
- 376 - 
 
  
 have controlled relevant epidemic and propose request to China to cancel import ban measures, 
China will, according to international standards and working procedures, organize experts to perform risk analysis work by means of questi onnaire evaluation and on-the-spot investigaion. 
Upon request of trade partners, China may provide relevant risk analysis reports in accordance 
with the time and mode agreed in bilateral negotiations. The progress o risk analysis work depends on the degree of cooperation of trade partners  nd the integrity of relevant technical data. 
 
Generally, the standard procedure of cancellation of ban measures is: relevant countries or regions have controlled relevant epidemic and propose request to cancel import ban measures; China organizes experts to perform questionnaire evaluation and requires supplementing materials 
according to the situation of questionnaire evaluati on; if the materials of the party being evaluated 
can prove that it has controlled relevant risks, China will form expert group to perform on-site evaluation; the risk evaluation report will be comple ted; if it is in conformity with the requirement 
of sanitary conditon of China, the Administration of Quality Supervision, Inspection and Quarantine 
(AQSIQ) together with the Ministry of Agriculture re lease order of lifting the ban, which is released 
specifically in the form of joint communique of AQSIQ and the Ministry of Agriculture. 
 
Page 78 (Paragraph 3.84)   Question 
71. Could China provide further information on the technical evaluation that justified the 
restrictions placed on the imports of beef from some WTO members?  
 
Answer 
Because there has been no incidence of mad cow disease in China and research data indicate that 
the Asians are more susceptible to pathogens of mad cow disease, in order to protect public health security and health of Chinese animal products and prevent invasion of mad cow disease, China 
has taken a prudent attitude to and strict trad e restriction measures against countries with 
incidence of mad cow disease. Because the pathogenesis and route of transmission of mad cow disease are relatively complicated, we suggest China and Brazil strengthen technical exchange to 
jointly perform the technical evaluation work of preventive and control measures for mad cow 
disease.  
Page 84 (Paragraph 3.108)  
According to the Secretariat, the China Eximbank: (i) "provides export financing services in areas that social and commercial capital are unwilling to enter"; (ii) "assists Chinese companies in undertaking overseas construction and investment projects"; and (iii) "promotes international 
economic cooperation as China's official provider of credit to developing countries and as China's 
recipient of foreign aid".  
Question 
72. Could China provide the total amount of credit  approved and disbursed by China Eximbank in 
the last 5 years for the three categories mentioned? Could China break-down this figures for 
regions and main countries? Could China provide the average rate and conditions of these credits? 
Could China provide the same numbers for Sinosure?  
 Answer 
The interest rates of export credit of the Export -Import Bank of China are determined according to 
the following principles: credit interest rates float on the basis of base rate. Fixed interest rate of short term (below one year and including one year ) foreign currency loan is determined according 
to LIBOR and addition of base points; fixed interest rate of medium and long term (over one year) 
foreign currency loan is determined according to CIRRs and addition of base points; foreign currency floating interest rate loan is quoted according to LIBOR and addition of base points and 
setting rate may select LIBOR value of 1, 3, 6 and 12 months. 
The application conditions of all kinds of export credit businesses of the Export-Import Bank of 
China have been released on the website of the Export-Import Bank of China for public query.  Now, China Export & Credit Insurance Corporation (Sinosure) does not make special data statistics 
according to the scopes of the above three busine sses carried out by the Export-Import Bank of 
China; there is no foreign aid business.  WT/TPR/M/300/Add.1 
 
- 377 - 
 
  
 Page 85 (Paragraph 3.113) 
 Question 
73. Could China clarify the role of CDB in the provision of export credit? As the manager of 
overseas development funds such as the China- Africa Development Fund, does the CDB provide 
support to Chinese companies` exports to the markets targeted by those funds? 
 
Answer 
Since its establishment, the China-African Development Fund plays a main platform role for investment in Africa and makes active contribution to the development of African countries in the 
fields such as agriculture, manufacturing, infrastructure and culture. 
 Page 85 (Paragraph 3.114)  
 
Question 74. Does Sinosure also provide export credits? Could China explain the main differences between 
the activities of China Eximbank and Sinosure?  
 Answer 
Sinosure does not provide any export credit, but it  provides insurance support for the export credit 
of the China Eximbank; however, the China Eximba nk can provide export credits, but it is not 
engaged in export credit insurance business.  
Page 85 (Paragraph 3.116)  
The Secretariat affirms that "Since 2009, export credit insurance policy has been one of the most important means of supporting foreign trade in China".  
 
Question 75. Could China explain how export credit insuranc e has been used to promote Chinese exports?  
 
Answer 
By playing the functions of export credit insurance such as risk management, financing facilities 
and information services ，export credit insurance helps to reduce trade costs and play a active 
role in strengthening their risk resistance capacities and stable operation capacities. 
 
Page 88 (Paragraph 3.126)  
 According to the Secretariat "there appear to be other support programmes and other means to support different industries (e.g. fisheries) including through the provision of grants, policy lending 
by state-owned banks and the supply of goods at lower than "market price" by state-owned 
enterprises (SOEs)".   
Question 
76. Could China inform the sectors where SOEs supply goods at lower than market price?  
Question 
77. Could China provide further information on those programmes and means of support to its 
industries?  
 
Answer to Questions 76-77 
Chinese government treats all kinds of market entities with "equal perspective and protection" 
according to laws and is committed to create market environment of fair competition for enterprises in all kinds of forms of ownership. In 1990s, Chinese government had cancelled the 
supports to state-owned enterprises by relevant measures such as financial and tax reforms and 
there is on situation in which it supports the state-owned enterprises in any way.  
Page 90 (Paragraph 3.129)  
 The Secretariat affirms that, in 2012, "financial institutions were encouraged to use flexible credit 
products so as to enhance support for export-oriented enterprises".  WT/TPR/M/300/Add.1 
 
- 378 - 
 
  
 Question 
78. How the PBC encourages the use of these flexible credit products?  
 
Question 
79. What are the criteria and conditions adopted by the PBC and its financial institutions to subsidize interest rates on loans to key sectors and industries?  
 
Question 80. Could China list the enterpri ses benefited by this measure?  
 
Answer to questions 78-80 
In recent years, the reform of interest rates liber alization in China is accelerated and has obtained 
important progresses. Now, interest rates of cu rrency market, interest rates of bond mark and 
deposit and loan interests rate of domestic foreign currency have be liberated completely, 
regulations of credit interest rates of financial institutions have been opened comprehensively and 
People's Bank of China does not interfere the credit businesses of commercial banks. Commercial banks negotiate independently with clients according to the market principle and factors such as 
credit terms and client's credit to determine specific credit interest rate level and there is no 
special credit policy specific to certain industry.  
Page 91 (Paragraph 3.131)  
 According to the Report by the Secretariat, SO Es are supported by the Chinese Government in 
various ways.  
 Question 81. Could China provide further information on that?  
 
Answer 
In 2007, the State Council issued the Opinions on Trial Implementation of State-owned Capital 
Management Budget, which formally establishe d the state-owned capital management budget 
system. China is a developing country, and the tasks of reform and development of state-owned 
enterprises are very difficult. Now, the state-owned capital management budget system mainly is  
used for supporting the reform and development o state-owned enterprises. For the future, we 
will, according to the requirements of the Th ird Plenum of the 18th CPC Central Committee, 
perfect the state-owned capital management budget  system and upgrade the ratio of proceeds of 
state-owned capital paid to public finance so as to use more money in protecting and improving 
people's livelihood. In accordance with the prov isions of the Regulations on the Disclosure of 
Government Information, the budget and final a ccounting of state-owned capital management of 
the central government have been disclosed to the society, and specific information on expenditure of state-owned capital management bu dget will be publicized in the annual budget 
and final accounts of state-owned capital management. 
 Page 92 (Paragraph 3.132)  
 
Question 82. Could China provide further information on industry-specific subsidies for inputs, land and 
technology to some sectors deemed to be strategically important by the Chinese Government?  
 Page 99 (Paragraph 3.165)  
 
The Secretariat assesses that "China applies price controls to commodities and services deemed to 
have a direct impact on the national economy and people's livelihoods".   
Question 
83. Could China explain how these price controls are compatible with the concept of a market economy?  
 WT/TPR/M/300/Add.1 
 
- 379 - 
 
  
 Answer 
After years of price market-oriented reform, at pr esent, more than 95% of prices of goods and 
services has been opened and formed independently in the market. The market mechanism has 
fully played a basic role in the resource allocati on, and the socialist market economic system has 
been established. Adaptable to gradually expandin g the proportion of market-adjusted price, the 
means of government price regulation have turned into economic and legal means. The price 
pattern of comprehensive application of monetary , finance, investment, import and export and 
other policy regulation has been formed, which is adapted to the requirement of a market economy. Goods and services for which China impl ements government pricing and guide price are 
within the scope of commitments of China's access ion to the WTO. After China's accession to the 
WTO, China also takes the initiative to open up a part of the prices of goods. At present, 
government pricing management covers a few important commodities closely associated with national economy and people's living standards, a few of goods with resource scarcity, naturally 
monopolized goods, important public utilities an d public welfare service. Government pricing 
management basically reflects domestic production cost and market supply & demand, which is the same as in other market economy countries, neither controlling a large number of prices, nor 
violating the requirements of a market economy. 
 Pages 109/110 (Paragraph 3.199)   
Question 
84. Could China provide further information on the "integration of IPR protection with industrial 
policy" in key industries? 
 
Answer 
The integration of IPR protection with industry policy aims to the coordinate IPR protection and 
industry policy, intensify the guidance of industry  policy and achieve the goal of industry policy. 
priority review will be conducted for patent applic ation in the areas of energy saving, environment 
protection, biology, new energy, new mate rial and low-carbon technology, etc. 
 
Page 109 (Para 3.199)  
 Paragraph 3.199 states that the National Inte llectual Property Strategy for 2013 included 
measures aiming at raising the quality of intellec tual property rights. Among such measures is the 
improvement of the patent examination system  and streamlining the process of patent 
applications. 
 
Question 85. What were the activities carried out in order to  attain the goals of improving the overall patent 
examination system? What were the main results? Please provide details.  
 
Answer 
Related departments of China faithfully implemen t the Promotion Plan for the Implementation of 
the National Intellectual Property Strategy in 201 3, to further improve the protective environment 
of intellectual property rights. In 2013, the applic ation and the ownership of intellectual property 
rights were increased steadily in China. The num ber of applied patents and trademarks ranked No. 
1, the number of copyrights and new strains of plants continued to increase, the structure of 
intellectual property rights was further optimize d, and the quality was further improved. At the 
same time, the protective environment of China's intellectual property rights was effectively 
improved. In China, local courts dealt with 88,583 civil cases of intellectual property of the first 
instance in 2013, with a year-on-year growth of  1.33%. The intellectual property system handled 
16,227 cases of patent administrative law enforcement, with a year-on-year growth of 79.8%. The 
industrial and commercial systems investigated 83, 141 cases of infringement of fake and inferior 
commodities.  
Question 
86. Are there quality management systems in place for assessing the examination of patent applications? Please provide details. WT/TPR/M/300/Add.1 
 
- 380 - 
 
  
 Answer 
The Chinese government has established and improved the quality management system and 
business instruction system, set up the qua lity evaluation agency. We conducted quality 
inspection, business instruction and training on pers onnel, identified and improved the weak point, 
conducted case study and exchanged views, in order to guarantee and enhance capacity of 
research and review in the quality management system. 
 
Page 110 (Para 3.199)  
 Paragraph 3.199 also states that the strengthening of IPR protection is a strategic theme under 
the National Intellectual Property Strategy for China. This is to be achieved by, among others, 
strengthening of IPR protection for pharmaceuticals.   
Question 
87. How does the Government of China intend to strengthen IPR protection for pharmaceuticals? 
Will pharmaceuticals patents enjoy a different level of protection with regard to other areas? 
Please provide details.  
 Question 88. Is the second use of a known substance patentable under the Chinese legislation?  
 
Question 89. Is the new form of a known substance protectable under relevant patent regulations? If so, 
what are the criteria for evaluating the therap eutic efficiency of such new form of a known 
substance?   
Answer for questions 87 to 89 
There are no specific provisions in the field of the Patent Law and relevant regulations, to protect 
the patent right of medicine. The new-usage invention for known products is methods invention, which is the protection object of the Patent Right. If this known product is used for medicine, it can 
be granted patent right. The new-agent invention of medicine is product invention, which is 
deemed as the protection object of the Patent Right. SIPO will take the difference between this new agent and the existing technology, the difficulty in acquiring the technology of this new agent, 
the technical effect of this technology (including medicinal cure effect) into consideration and thus 
to review and determine whether it is in compliance with the requirement of patent. Page 112 (Para 3.205)  
 
Paragraph 3.205 describes the process of patent a pplications in China. In this regard, please 
answer.  
Question 
90. Does the legislation in China also encompass mechanisms for combating the misappropriation of genetic resources? If so, what are the relevant provisions?  
 
Question 91. Has China experienced cases of misappropriation of genetic resources thus far? If so, what 
measures have been undertaken by the Chinese authorities?  
 Answer 
According to the Para 5 of Article 25 of the Pate nt Law, In the event an invention-creation has 
been realized through reliance upon genetic resour ces, an applicant shall state, in the relevant 
patent application documents, both the direct and or iginal sources of said genetic resources. In the 
event the applicant is unable to do provide info rmation on the sources, the applicant shall state 
the reasons. Also, as stipulated in Para 2 of Article 5 of the Patent Law, no patent right may be 
granted for any invention-creation that has be en achieved through dependence upon genetic 
resources that are acquired or utilized in a way th at violates any law or administrative regulation. 
 WT/TPR/M/300/Add.1 
 
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 Page 112 (Para 3.207)  
 Paragraph 3.207 describes the process of "preliminary national-interest clearance" of foreign or 
international patent or utility model applications in which the substantial content of the technical 
solution of the invention was generated within the Chinese territory or resulted from R&D activities of major national projects. 
 
Question 92. Does a patent or utility model application which is cleared under such process receive fast-track treatment during the substantive examination by SIPO? If so, on which grounds?  
 
Answer 
The mentioned paragraph 3.207 means that the invention or utility model application shall be 
undergone reviews for secret by SIPO before submitting to foreign institutions for patent approval. 
The applications involving national security or public interests will determined as confidential. 
Therefore, whether applications are results of th e national key projects is not the condition for 
review. So long as finished in China, the inventio n shall be gone through review for secret before 
submitting patent application to in foreign countries, which is not related to the fast-track treatment during the substantive examination by SIPO. Those application enjoying fast-track treatment shall be in line with relevant provisions in the Measures on the management of Priority 
Review for Patent Application of Invention. 
 Question 
93. In view of the fact that the concept of" substantial content" is not defined in the Chinese 
Patent Law or in its Implementing Regulations could the Chinese delegation indicate whether there is a specific case law that addresses its definition?  
 
Answer 
At present, there's no definition of substantiv e content. The concerned authority makes judgement 
according to the right requirement in the patent application. 
 
Page 113 (Para 3.211)   
Paragraph 3.211 describes the fast track for patent examination and approval in the case of 
"patent applications linked to strategic emerging industries and to green technologies with significant economic and social impact and a high degree of invention". 
 
Question 94. Is the definition of the strategic emerging industries eligible for requesting such fast-track identic to the definition mentioned in the twelfth Five-Year Plan? Please provide details.  
 
Question 
95. What is the definition of the green technologi es eligible for requesting such fast-track? Are 
these technology sectors defined by a class under WIPO's Strasbourg Agreement Concerning the 
International Patent Applications? Please provide details.   Answer 
SIPO-formulated measures on the management of Priority Review for Patent Application on Inventions to regulate the system of priority revi ew for patent application. The item 1 and item 2 
of Article 4 provides the priority review for patent application in the sector of emerging industries 
of strategic importance and green technology. Whether the application involves green technology 
shall be determined by the contents of the application and WIPO's Strasbourg Agreement 
Concerning the International Patent Applications is also a reference as well. 
 WT/TPR/M/300/Add.1 
 
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 Page 116 (Para 3.224)  
 Paragraph 3.224 describes the process for obtaining th e protection of geographical indications (GI) 
in China. It states that GIs may be protected under the Trademark Law and its Implementing 
Legislation and that, alternatively, they may also be registered with AQSIQ or the Ministry of Agriculture.  
 
Question 96. Is there any difference in terms of the leve l of protection or the enforcement procedures 
applied to the protection of a GI registered under  the Trademark Law and that of a GI registered 
with AQSIQ or the Ministry of Agriculture?  
 Answer 
In accordance with relevant provisions of th e Trademark Law and Implementing Regulations for 
Trademark Law, the Trade Office of Administration for Industry and Commerce has registered and protected geographical indications in the form of registering collective trademarks and certification 
trademarks. The geographical indications registered under the Trademark Law and registered with 
the sector (Administration of Quality Supervision
，Inspection and Quarantine, AQSIQ) or the 
Ministry of Agriculture have different applicable procedures. 
 
Question 97. What are the criteria for the examination of a GI application registered with AQSIQ and with 
the Ministry of Agriculture? Are those criteria different from those applied by SIPO under the 
Trademark Law?  
 
Answer 
Geographical indications and trademarks are two different types of intellectual property rights, 
having different legal basis. The Ministry of Agriculture carries out the registration and protection of geographical indications of produce on the basi s of Agricultural Law and Law of Produce Quality 
and Safety, and has successively promulgated the Administrative Measures for Geographical 
Indications of Agricultural Products, and more than  20 specific rules and regulations. In terms of 
review, the Ministry of Agriculture has formulated the Code for Review of Geographical Indications 
of Produce and scientific standards for registration. Legal basis and registration requirements are 
different, so specific review standards are different of State Administration for Industry& 
Commerce and AQSIQ to a certain extent.  
4 - TRADE POLICIES BY SECTOR  
 Pages 124 to 126 (Paragraphs 4.3 to 4.8 
 
Question 98. Could China comment on its alleged "self-suffic iency policy" for the production of grains? What 
are the instruments and means used to achieve this goal? Which grains are covered by this policy? 
Answer 
China is a country with large population. Food securi ty is not only the priority of China, but also a 
vital factor for maintaining the world food security . Self-sufficiency does not mean we produce all 
grains domestically, but to produce most of them by ourselves while importing some from the 
international market. The means to achieve the goal are: infrastructu re building, technology advancement, market 
promotion and so on. 
 Page 127 (Paragraph 4.13)   
According to the Secretariat Report, "some products subject to TRQs (i.e. grains, cotton, sugar, 
and chemical fertilizers) are also subject to state trading".   
Question 
99. Could China provide further information on the state trading of agricultural products and inputs? 
 WT/TPR/M/300/Add.1 
 
- 383 - 
 
  
 Answer 
In China, the state trading enterprise refers to an  import and/or export trading enterprise with the 
authorization of state trading, specialized in the products listed in Appendix 2A of Protocol for 
China's Accession to the WTO. Different from operation of other members of state trading 
enterprises, the operation of state trading en terprises in China has no problem of market 
intervention, because the operation of these ente rprises belongs to market-oriented operation, 
without government intervention. These enterprises can adjust or change import-export volume 
and import-export progress independently according to supply& demand and price change on the international market. For these state trading enterprises, the concept of state trading is only restricted to import and/or export trade of prod ucts listed in Appendix 2A, Protocol of China's 
Accession to the WTO, not involved in their operation. 
 As for the changes of the state trading products listed in Appendix 2A of Protocol for China's 
Accession to the WTO, starting from 1 January 2006, import of rapeseed oil, soybean oil and palm 
oil is not under the state trading management. St ate trading management of tea export has been 
cancelled since May 2004, and that of silk export  has been cancelled since January 2005, and that 
of export of soybeans, non-bleached silk, cotton yarn and cotton woven fabric has been 
unexecuted since China's accession to the WTO.  Page 130 (Paragraph 4.24)  
 
Question 100. What kinds of subsidies have been available to purchase inputs, improved crop strains, 
agricultural machinery and tools? Could China name all the relevant programmes and legislation 
on these subsidies?   
Answer 
Please refer to our notification concerning subsidies submitted to the WTO for the details. 
 Page 130 (Paragraph 4.25)  
 
According to the Secretariat Report, "the centrally  funded comprehensive subsidy on agricultural 
inputs was introduced in 2006 and by 2008 had become one of the most important single 
budgetary transfers supporting agriculture. Budge tary transfers for this programme more than 
doubled in 2008 and have increased each year since to reach RMB 107.8 billion by2012.24 The objective of this support programme is to compensate grain producers for any increase in the price 
of agricultural inputs such as fertilizer and diesel fuels; however, it is implemented as a payment 
per unit of land, it is not linked to the cost of production".  Question 
101. Could China elaborate on these subsidies? Wh at are the relevant legislation and regulations 
involved in these budgetary transfers?   
Answer 
Please refer to our notification concerning subsidies submitted to the WTO for the details. 
 
Page 141 (Paragraph 4.67)  
 The State Council in July 2013 encouraged private capital to invest in commercial city banks, commercial rural banks and village banks.  
 
Question 102. Were foreign private banks also encouraged to invest in those banks by the same measure?  
 
Answer 
China allows qualified foreign financial institutions to invest in commercial city banks. According to 
related regulations of Measures for the Implementation of Administrative Licensing Matters 
Concerning Chinese-funded Commercial Banks, if a foreign financial institution become a 
shareholder of a Chinese-funded commercial bank, they should satisfy the conditions as below: the total assets of not less than US$10 billion at the end of the last one year; good long-term credit WT/TPR/M/300/Add.1 
 
- 384 - 
 
  
 rating in the last two years; consistently profitable accounting year in last two years; the capital 
adequacy ratio of commercial bank has reached its average in the registered place and is not less than 10.5%; or the capital sum of non-banking fina ncial institutions is not less than 10% of the 
total risk-weighted assets; sound and effective internal control. 
 PART II: QUESTIONS REGARDING THE GOVERNMENT REPORT  
 
2 - ECONOMIC AND TRADE ENVIRONMENT AND MACROECONOMICPOLICY DIRECTION  Page 8 (Para 2.24)  
 
In December 2012, the Chinese Government formulated the "Twelfth Five Year Plan" on the development of the service sector and proposed the goals of increasing the proportion of the 
service sector, improving the standard of the service sector, pushing forward there form and 
opening up in the sector, and enhancing its capacity  of creating jobs and attracting employment.  
 
Question 
103. What importance does China consider foreig n service providers will have in the goal of 
increasing the proportion of the service sector?  
 
Answer 
Since the reform and opening up, China has active ly attracted foreign investment and promoted 
industrial upgrading and technological progress;  meanwhile, foreign-funded enterprises have 
become an important part of national economy.  China has a huge market for the service sector 
and unlimited development potential. China will co ntinue expanding the domestic service sector, 
opening it to the outside world in accordance with the principle of initiative, stability and order.  
Page 11 (Para 2.39)  
 A series of other specific measures are also adopted to facilitate the registration of enterprises so 
as to provide optimized business environment for their development.  
 Question 
104. May the Government of China provide more in formation concerning other specific measures 
implemented to optimize the business environment?  
 
Answer 
According to the Notification on Scheme for Registration System Reform Concerning Registered 
Capital Promulgated by the State Council in 2014 (Guo Fa [2014] No. 7), reform measures will be put forward to optimize the business environment from five aspects as follows: first of all, the subscription and registration system of regi stered capital is implemented, namely, the 
shareholders (originators) have reached an agreemen t on subscription of registered capital, means 
and time limit of capital contribution independentl y, etc., and shall be responsible for authenticity 
and legitimacy of capital contribution.  
Secondly, the conditions for registration of re gistered capital are relaxed. Unless otherwise 
specified in laws and regulations, the minimum registered capital is cancelled; the ratio of initial capital contribution and the deadline of capital su bscription by the shareholders (originator) are 
not limited. No capital verification report is submitted when company registration.  
Thirdly, the enterprise annual check system is ch anged into the publicity system of annual report, 
and any unit and individual can query it. Fourthly, registration formalities for the residence (premises) of market entity are simplified, and spec ific provisions shall be formulated by the local 
government. Fifthly, the electronic business license and the overall electronic registration 
management are carried out.  WT/TPR/M/300/Add.1 
 
- 385 - 
 
  
 Page 14 (Para 2.5.2)  
 In August 2013, the State Council promulgated the Opinions on the Reform of the Railway 
Investment and Financing System and the Accelerati on of Railway Construction to fully open up 
the market of railway construction, to encourage social capital to invest in building railways, to push ahead the market-oriented reform of railway transport pricing, and to require China Railway 
Corporation to stick to market-oriented business operations as an enterprise and accelerate the 
construction of modern corporate system.   Question 
105. What importance does China consider foreign investors will have in the Railway Reform?  
 Answer 
Recently, China has promulgated a series of major initiatives to reform of the railway investment 
and financing system, to accelerate the development of railway construction, clearly requesting "the ownership and management of inter-city railway, regional (suburb) railway, resource 
exploration railway and branch railway shall be open ed to the local government and social capital, 
to encourage investment of social capital in the railway". Relevant departments are studying and revising the Catalogue for the Guidance of Foreign-Invested Industries, formulating the Measures for Admittance and Licensing of Railway Transport En terprise in accordance with the requirements 
of reform, to attempt to regulate the admittance of the railway transport market, to create 
favorable conditions for all capital investment in railway construction. Welcome all foreign investors including Brazil to invest in Chinese railway industry. 
 
Page 14 (Para 2.5.4)   
The Chinese Government has also sped up the opening-up of the medical services market and 
promoted participation of social resources in medical facilities.   Question 
106. Did or will the opening-up of the medical serv ices market in China include regulatory reform 
to encourage the participation of foreign service suppliers in any of the 4 modes of supply?  
 
Answer 
In 2009, the Central government promulgated the Opinions on Deepening Medical and Health 
System Reform, clearly indicating that the harmonious and unified medical and health 
management system will be created, implementi ng localized and industry-wide management. All 
medical and health institutions, regardless of ow nership, investors, subordinate relations and 
business nature, are planned, permitted and regulated uniformly by the local health administrative department. The Opinions also points out that the social capital is encouraged and guided to 
develop the medical and health services, admittance conditions for social capital including foreign-
funded medical institutions are specified, and the impartial industrial management policy is improved. Welcome all qualified foreign-enterprises to invest in Chinese medical and health fields. 
 
Page 6 (Paragraph 2.13)   
Question 
107. Could China explain the affirmation that "the central bank does not ease or tighten up monetary policy"?   
Answer 
In 2012 and 2013, the Chinese government continued to adhere to a prudent, stable and 
consistent monetary policy. It also endeavoured to make the policy more targeted, flexible and 
forward-looking. As China carried out timely and moderate pre-emptive adjustments and fine 
tuning of its monetary policy, its financial reform was broadened along new horizons and provided the structural adjustment, economic transformati on and upgrading with a stable monetary and 
financial environment. It also helped drive the Chinese economy onto a more sustainable path of 
development.  WT/TPR/M/300/Add.1 
 
- 386 - 
 
  
 Page 17 (Paragraph 3.17)  
 Question 
108. Could China name its "import promotion policies"? What is the relevant legislation and 
regulations when it comes to import promotion?   
Answer 
China continues to improve import promotion policies and broaden import channels. In 2014, the 
number of imported goods with lower interim tariff rates was lowered to over 760 HS items, but the average margin of preference rose to 60%.  Thus import was further increased to satisfy 
people's consumption needs and to meet the ne eds required in the agriculture and husbandry 
production and in the domestic adjustment of industrial structure. The Chinese Government further simplified import administration procedure. In July 2012 and September 2013, the Ministry 
of Commerce respectively removed the automatic import licensing administration of 27 products 
and 130 products at HS 10-digit level. The online license application is now moving forward smoothly. 
 
PART III: OTHER QUESTIONS   Question 
109. Is there any regulation in China that forbids a Chinese private bank to give a guarantee for a 
transaction performed by a fully-owned subsidiary located in China or abroad?  
 
Answer 
According to the prevailing Administrative Regu lations for Cross-border Guarantee of Foreign 
Exchange, a Chinese private bank can give a guarantee for a transaction performed by a fully-owned subsidiary located in China or abroad, and prior approval is not needed. 
 
Question 110. Is there any regulation in China that forbids a Chinese private bank to give a guarantee for a 
special purpose company located abroad or in a special administrative region?  
 Answer 
According to the prevailing Administrative Regu lations for Cross-border Guarantee of Foreign 
Exchange, a Chinese private bank can give a guarantee for a company with special purposes located abroad or in a special administrative region, and prior approval is not required. WT/TPR/M/300/Add.1 
 
- 387 - 
 
  
 ADDITIONAL QUESTIONS BY BRAZIL  
PART I: QUESTIONS REGARDING THE SECRETARIAT REPORT  
 
ECONOMIC ENVIRONMENT  
 Page 20 (Para 1.22)  
In line with the decisions of the CPC Central Committee and the State Council, that finance should 
serve the real economy, efforts were made to e nhance the coordination between credit policy and 
industrial policies, by speeding up rural financial product and service innovation, improving the provision of financial services for small and medium-sized enterprises, by continuing to implement 
a differentiated housing credit policy, and by ad opting measures to prevent and alleviate local 
debt-related risks. To achieve the first goal, th e People´s Bank of China (PBC) guided financial 
institutions to intensify financial support to areas such as scientific and technological innovation, 
emerging industries of strategic importance and the service industry. Financial institutions were 
guided to extend credit support to key industries  and sectors, such as railways, shipping, thermal 
power and steel, in keeping with credit risk management principles and supporting primarily 
enterprises that are profitable, comply with requ irements on environmental protection and safe 
production and satisfy prudential credit conditions. Financial institutions were encouraged touse credit products flexibly to enhance support for expo rt-oriented enterprises that were able to attract 
orders, were profitable and met prudential credit conditions; they were also guided to increase 
credit and financing support to sectors that promoted energy conservation and emissions 
reduction. To this end, the China Banking Regulatory Commission (CBRC) promulgated the Green Credit Guide, urging and guiding banking and financial institutions to enhance their support to the 
green economy (e.g. recycling and low carbon emission activities) and promote sustainable 
development based on the principles of controllab le risks and sustainable business. Together with 
the National Development and Reform Commission (NDRC), the China National Tourism 
Administration (CNTA) and the CBRC, in 2012 the PBC formulated and promulgated the Opinions 
on Stepping up Financial Support to Facilitate  the Rapid Development of the Tourism Industry, 
requiring financial institutions to support the development of the tourism industry by improving credit management, and developing innovative credit products.  
 
Questions 1. Which practical incentives have been implem ented by the People`s Bank of China (PBC) to 
guide and encourage financial institutions on its credit policies?  
Reply: First, the PBC has strengthened guidance on credit policies, encouraging and leading financial institutions to provide relevant services, and developing financing projects for the demand 
of high tech enterprises; second, the PBC has directly promoted innovation of financing 
instruments, launched in succession such debt financing instruments as short-term financing bonds, mid-term bills and private placement bonds for practical technology enterprises.  
2. Which measures have been adopted to prevent and alleviate debt-related risks?  
 Answer 
As stipulated by CBRC, all banking financial institutions shall, by following the general principle of controlling the total quantity, exercising classified management, giving differentiated treatment, and providing gradual solution and with the focus on controlling the total quantity, optimizing the 
structure, isolating risks and clarifying duties, promote the risk management and control 
associated with loans to local government financing platforms. Firstly, banking financial institutions shall timely settle the risks of maturity, keep cons tant track of the amount of the mature loans on 
the platforms, the sources of debt repayment funds, the actual repayment and other relevant 
circumstances, and adopt appropriate measures as soon as possible. Secondly, banking financial 
institutions shall effectively control the risks of total quantity, strictly implement the standards of 
granting new loans and satisfy such binding conditions as realizing full coverage of the borrowers 
cash flow and keeping mortgage guarantees in compliance with current rules. Thirdly, banking 
financial institutions shall optimize the structure of existing loans, guiding the application of new loans in supporting such reasonable financin g demands as qualifying government-subsidized 
housing and national key projects under construction and expansion, and decrease and clear the  
loans to financing platform with low cash flow coverage or high asset-liability ratio. Fourthly, banking financial institutions shall enhance comprehensive risk management and consider the WT/TPR/M/300/Add.1 
 
- 388 - 
 
  
 matching extent between the aggregate liabilities of the financing platform and their repayment 
capability in an overall way.  
 
Page 27 (Para 1.41) 
 Currently, the RMB is fully convertible for current account transactions, and partly convertible for 
some capital account transactions. Since 2011 all residents and non-residents can use RMB for 
FDI. In the 12
th Five-Year Plan, the Chinese Government put forth a policy of "gradually making 
the RMB convertible for capital account transactions". The Plan does not establish a sequence for capital account liberalization. The authorities indicated that they expect that the gradual 
liberalization of the capital account and of interest rate determination will reinforce each other and 
lead to a market-determined exchange.   
Question 
3. Assuming that an open capital account would improve the quality of Chinese foreign assets, promote cross-border use of the RMB and help th e country`s enterprises structure in a global 
perspective, and also considering that the precondi tions for successful capital account liberalization 
are a stable macroeconomic environment, a sound banking system and developed financial markets, what are the challenges for China to achi eve full liberalization of its capital account?  
 
Answer 
First of all, a fully open capital account must be  coordinated with the market-oriented reform of 
exchange rate and interest rate as well as the development of the domestic financial market, 
which mainly includes: orderly promoting the market-oriented reform of exchange rate and 
interest rate, speeding up the construction of a multi-level financial market and a modern financial organization system and properly improving the anti -risk capabilities of China's financial system in 
the process of open-up. Secondly, China must establish and improve a capital flow monitoring and 
early warning system. In order to realize a fully open capital account, China must properly reinforce the monitoring on cross-border capital,  especially short-term capital flow, timely and 
correctly monitor the information and trends of cr oss-border capital flow, improve relevant early 
warning and emergency mechanism and prevent shock against cross-border capital flow. 
 2 - TRADE AND INVESTMENT REGIME  
 
Page 51 (Para 2.78)   
The authorities indicated that the launching of the China Shanghai Pilot Free Trade Zone (CSPFTZ) 
is a national strategy to deepen reforms. Since it is a Pilot Zone, policies will be tested in the Zone and this will serve as a showcase for further trade and investment liberalization nationwide. The authorities also indicated that Shanghai was chosen because it had traditionally been at the 
forefront of China's reform policies. The CSPFTZ is meant to expand and open up the service 
sectors and to reform the investment administration mechanism, push forward trade transformation, deepen the opening up of financial services, and create a new mode of supervision 
and service.  
 Question 
4. What does "new mode of supervision and service" exactly mean in relation to the financial 
services sector in China Shanghai Pilot Free Trade Zone (CSPFTZ)?   Answer 
CSPFTZ has preliminary formed the institutional framework for financial open-up and innovation and a series of supervision and service measures regarding financial innovation. Such financial authorities as the People's Bank of China have fo rmulated a package of supporting policies on such 
issues as free trade account systems, facilitation for investment, financing and foreign exchanges, 
cross-border use of RMB, market-oriented reform of  interest rate, foreign exchange administration 
reforms and financial institutions and business innovations. 
The Circular of the China Banking Regulatory Commission on Issues Concerning Banking 
Supervision in China (Shanghai) Free Trade Zone (Y in Jian Fa [2013] No. 40), the Opinions by the  
People's Bank of China to Support China (Shanghai) Pilot Free Trade Zone in Financial Sector issued by the People's Bank of China on December 2, 2013 and the Arrangement regarding China WT/TPR/M/300/Add.1 
 
- 389 - 
 
  
 Banking Regulatory Commission Authorizing Shanghai Office to Promulgate Banking Regulatory 
Rules on the Pilot Free Trade Zone, have reflec ted the new mode of supervision and service in 
relation to the financial services sector in CSPFTZ: while the various laws and policies regarding 
CSPFTZ are being ever reformed and amende d, the government will adopt new mode and 
standards of supervision and service system which are more practical and market-oriented and closer to the demands of physical economy in order to better prevent systematic financial risks, 
encourage financial institutions to innovate, serve the physical economic, promote investment and 
facilitate trade.  Page 53 (Para 2.86) 
 
The administrative rules are contained in the Procedures for the Administration of China 
(Shanghai)Pilot Free Trade Zone, promulgated by De cree No. 7 of the Shanghai Municipal People's 
Government on 29September 2013. The Procedures  established the China(Shanghai) Pilot Free 
Trade Zone Administrative Committee to specifically carry out reforms in the CSPFTZ, and undertake overall management and coordination of the relevant administrative affairs in the zone. 
The Administrative Committee, more specifically, has responsibility for: (a) promoting the 
implementation of various pilot reforms in the CSPFTZ, putting forward the policy-related measures and administrative management systems required; (b)taking charge of the administrative work in the areas of investment , trade, financial services, planning and land, 
construction, greening and city appearance, environmental protection, labour and human 
resources, food and drug supervision, intellectu al property rights, culture, public health, and 
statistics within the CSPFTZ; (c) directing the admi nistrative work of the departments of industry 
and commerce, quality supervision, taxation, and public security within the CSPFTZ; (d) 
coordinating the administrative work of the depa rtments of customs, inspection and quarantine, 
marine affairs, and finance within the CSPFTZ; (e)undertaking the work related to anti-monopoly 
investigations; (f) taking charge of the provision of services and of law enforcement within the 
CSPFTZ. The Procedures are effective as of 1 October 2013.   Question 
5. Would there not be an administrative overla p between the People`s Bank of China (PBC) and 
the CSPFTZ Administrative Committee tasks, espe cially on banking licensing, supervision and 
resolution?  
 
Answer 
CSPFTZ Administrative Committee and PBC, CBRC, CSRC and CIRC are not overlapped with each 
other in terms of administrative tasks. Access license, supervision and management related to 
banking financial institutions are still administered  by the banking regulatory authorities. CSPFTZ 
Administrative Committee will assist financial regulatory authorities in implementing various institutional innovation activities related to financial management, promoting the financial service 
sector to be further opened up, coordinating the introduction of various financial institutions and 
trading parties both at home and abroad, fostering a multi-level financial market opened to both Chinese and foreign parties and promoting the expansion of various financial functions. 
 
Page 53 (Para 2.88)  
Capital requirements have also been relaxed, re placing the requirement of paid-up capital with 
that of subscribed capital. It is up to the shareholders to determine the pledged capital contribution, as well as its mode and time-limit.   
Question 
6. Does capital requirements relaxation on CSPFTZ include financial institutions? What are the current capital requirements?  
 
Answer 
Paragraph 2.88 of the Secretarial Report has indicated that: [c]apital requirements have also been 
relaxed, replacing the requirement of paid-up capital wi th that of subscribed capital. It is up to the 
shareholders to determine the subscribed capital contribution, as well as its mode and time-limit. Except the banks, securities companies, futu res companies, fund management companies, 
insurance companies, direct sale companies, Sino-foreign labor service joint ventures and WT/TPR/M/300/Add.1 
 
- 390 - 
 
  
 companies limited by shares and established by sponsorship which are subject to other rules on 
paid-up registered capital under laws and admini strative rules, other companies in CSPFTZ are 
subject to the registration system of subscribed registered capital. 
In China, financial institutions are classified into licensed financial institutions and non-licensed 
financial institutions. Licensed financial institutions are basically classified into banks (commercial banks and non-banking financial institutions), insurance companies and securities companies. The 
relaxed requirements on capital adopted in CSPFTZ do not cover the above-mentioned three types 
of licensed financial institutions. Non-licensed financial institutions mainly include equity investment institutions, financing leasing institutions and local financial institutions (small0-amount loans, guarantee and pledge institutions), which are subject to the capital requirements to 
be formulated by the competent ministries of the State. 
 3 - TRADE POLICIES AND PRACTICES BY MEASURE 
 
Page 58, (Para 3.13)   
In China, duty rates on imports continue to co mprise: MFN rates, agreement tariff rates, special 
preferential tariff rates, general tariff rates, and tariff quota rates; in addition, interim tariff rates, which are usually lower than MFN rates, are applied for a specific period of time - usually one year and are actually the applied rate for that year.  
 
Questions  7. Is the complete list of China`s applied tariffs and tariff structure available online? If so, where? 
Is there an English translation of the list?  
 Answer 
The complete list of China`s applied tariffs and ta riff structure has been published on the website 
of the Ministry of Finance. Please refer to the Customs Tariff of Import and Export of the People's Republic of China of each year for the relevant English translations.  
8. Are interim tariff rates publicized online? If so, where can the lists be accessed? 
 Answer 
The interim tariff rates have also been publicized  on the website of the Ministry of Finance. 
 Pages 73/74 (Paras 3.68/3.70) 
 
The authorities noted that there has been no substantial change in the procedures to formulate standards, both voluntary and "mandatory" standards (as technical regulations are referred to in China),since the last Review. National standard s are formulated by SAC, through an eight-step 
process: feasibility study, research, project de sign, drafting of proposed standard, comments, 
examination, approval and publication. National  standards are reviewed after five years of 
implementation and might be amended or annulle d as required. Industry/sectoral standards are 
formulated by the standardization administrations of the competent ministries, with the support of 
the industry institutes of standardization and technical committees. National and industry/sectoral standards must be published in the Standard Press of China, and filed and stored at the National 
Library of Standards. Local standards are formulat ed by departments of standardization authorities 
of provinces, autonomous regions and municipali ties directly under the Central Government in 
accordance with the Administrative Measures on Local Standards.  The procedures to develop and issue a standard and a technical regulation (also referred to in 
China as "mandatory" standard) are similar but there are some differences. When a technical 
regulation is to be developed, it must be stipulated that it will be mandatory; the examination procedure is different, and the period to receive comments cannot be less than two months. A 
(voluntary) standard could be quoted in a te chnical regulation and thus it would become 
mandatory. "Mandatory" standards refer usually to: medicines, food, veterinary drugs, and 
pesticides; labour and transportation safety; construction; environmental emissions; and technical 
terms. The code of a mandatory national standard starts with the letters "GB". The code of a 
mandatory local standard starts with "DB" and the code of the Province (e.g. Shanxi Province, mandatory local standard code:DB14/).  WT/TPR/M/300/Add.1 
 
- 391 - 
 
  
 China's TBT Enquiry Point continued to be AQSIQ. The Enquiry Point was responsible for preparing, 
checking and submitting China's TBT notifications. During the period under review, China submitted 167 TBT notifications, most of them (some 150) under Article2.9. The majority of the 
technical regulations notified were applied to regulate the market and to protect human health, 
safety and the environment. In the TBT Committee concerns were raised regarding, inter alia, the length of time to comment and the ability of foreign companies to comment. 
 
Questions 9. Regarding the Chinese Requirements for information security products, including "inter alia" the Office of State Commercial Cryptography Administration (OSCCA) 1999 Regulation on commercial 
encryption products and its on-going revision an d the Multi-Level Protection Scheme (MLPS) (IMS 
ID 294), does China intend to notify these requirements to the TBT Committee? If not, why not?   
Answer 
We are in the process of coordinating domestic competent authorities for reply. 
 
10. Could China please provide more detailed information on its guidelines for a Strategic Policy for 
Standardization, Technical Regulation and Confor mity Assessment, as well as about the Trade 
Agreements with TBT+ Clauses it has agreed to recently (including Mutual Recognition Agreements)?  
 
Answer 
We are in the process of coordinating domestic competent authorities for reply. 
 
Page 79 (Para 3.88)  China continues to apply export taxes in accordan ce with the Regulations on Import and Export 
Tariffs. The list of goods subject to "statutory" and interim export duties is issued every year. 
Exports subject to statutory duties might also be subject to an interim duty, usually at a lower rate. Interim duties varied from 5% to 35% in 2013. Exports that are subject to interim duties 
may also be subject to a special export duty which is applied according to the season and may be 
substantially higher than interim duty rates. For instance, the special export duty rate was 75% in 
2013. Export duties are ad valorem, specific or they may take other forms as prescribed by the State; however, in practice, most of them are ad valorem.  
 
Question 11.Could China please provide the list of goods subj ect to export duties in 2014 at HS 8-digit level 
and its respective export tax rates?  
 Answer 
Please refer to the website of the Ministry of Finance or the Customs Tariff of Import and Export of 
the People's Republic of China of each year. 
 Page 85 (Para 3.110)  
Eximbank also has special lines of credit and different financial instruments to service SMEs. For 
instance, SMEs can benefit from "unified borro wing" and repayment, separate borrowing and 
"unified insurance" and "unified insurance and cu stody". During the period under review, Eximbank 
"properly" increased the proportion of direct payment to SMEs that took loans with them. 
Eximbank also set up a "Green Channel" for th e submission, examination and approval of loan 
applications submitted by SMEs.   
Question 
12. Could China please provide more detailed information on "Eximbank special lines of credit and different financial instruments to service SMEs"? What does China mean by "unified borrowing", 
"unified insurance" and "unified insurance and custody"? ? 
 Answer 
Eximbank separately formulates the credit plan for small and micro enterprises in each year, trying to realize the target of two no less than, which means the growth rate of loans to small and micro enterprises shall be no less than the average growth  rate of various loans and the increase in the 
quantity of loans to small and micro enterprises sh all be no less than that in the same period of WT/TPR/M/300/Add.1 
 
- 392 - 
 
  
 last year. Eximbank is proactively exploring the multi-source financial cooperation modes and has 
adopted such financing measures as self-borrowi ng and unified insurance and unified insurance 
and custody based on the mode of unified borrowing and unified refunding adopted for small and 
micro enterprises. 
 Unified borrowing and unified refunding is a lending mode under which the financing platform 
applies for loans in the name of the borrower and is responsible for principal repayment and 
interest payment and then allocates the loans to  actual users through entrusted loans or sub-
loans.  
Under the mode of self-borrowing and unified insura nce, the lender will directly disburse loans to 
the actual user and the actual user will assume the liability of principal repayment and interest 
payment and the cooperative institution will prov ide uniform guarantee for the loans under the 
mode. 
 Unified insurance and custody is a lending mode, under which loans are directly disbursed to the 
actual users of the loans, who are then responsi ble for principal repayment and interest payment 
and the cooperative institution provides guarant ee for the loans and is entrusted to carry out 
investigations on the actual users before, during and after loans. For details regarding "Eximbank special lines of credit and different financial instruments to service 
SMEs", please refer to the website of  Eximbank (http://www.eximbank.gov.cn/). 
 Page 106 (Para 3.182)  
 
Under Article 10 of the Government Procurement Law, the Government is required to procure domestic goods, construction projects and services, subject to certain exceptions. These 
exceptions are: when the goods, projects, or se rvices required are unavailable in China or, if 
available, cannot be procured on reasonable co mmercial terms; when the goods, projects, and 
services are procured for use abroad; or when it is otherwise provided for by other laws and administrative regulations. The Law itself does not contain a definition of domestic goods or 
provisions on local content, or rules of origin, to determine whether a product is produced 
domestically. Article 8of MOF Order No. 18 of  11 August 2004 states that the suppliers 
participating in the bids for supply of goods or services under government procurement must be 
domestic suppliers who supply domestic goods or services. However, foreign suppliers may 
participate in tenders and invitations to bid concerning goods and services if other laws and administrative regulations so prescribe. Domestic-sourcing requirements will have to be modified 
for procurement above GPA thresholds for China to join the Agreement. Although official statistics 
do not contain data on procurement by foreign suppliers or of foreign products, this appears to occur. In this respect, the authorities noted that  despite the "buy-domestic" provision included in 
the Government Procurement Law, the Chinese Government has been implementing a policy to 
facilitate the procurement of foreign products since 2007.  
 Question 
13. With regard to government procurement, could China please provide more detailed information 
on the requirements for local content and the rules of origin to determine whether a product is produced domestically?  
 
Answer 
The Ministry of Finance is researching and formulating the administrative measures on the procurement of domestic goods by governments to gether with competent authorities. Currently, 
the detailed definition of domestic goods may not be finalized. 
 WT/TPR/M/300/Add.1 
 
- 393 - 
 
  
 Pages 121/122 (Paras 3.258 and 3.259) 
 The Report by the Secretariat, Section Trade Policy and Practices by Measure, paragraphs 3.258, 
page 121, determine that "Customs  is in charge of IPR enforcement at the border, in accordance 
with the revised Regulations on Customs Protection of Intellectual Property, which entered into effect on1 April 2010". Furthermore, paragraph 3.259, page 122, determines that "IPR holders 
may record their rights with Customs for border protection. Such recorded rights are valid for ten 
years, renewable. Despite this, right-holders may apply to Customs for detention of suspected infringing goods, whether or not they have  recorded their rights with Customs".  
 
Questions  
14. Could China please elaborate on the measures taken by Customs in order to engage on ex officio seizures at the border, particularly with regard to exports of goods infringing intellectual 
property?  
 Answer 
In accordance with the Regulations of the People 's Republic of China on Customs Protection of 
Intellectual Property, where the customs suspects  that the imported and exported goods may 
infringe the filed intellectual property rights, it shall immediately notify the intellectual property 
right owner in writing. The right owner shall submit  the qualified application and pay the deposit in 
certain amount within 3 working days upon its receipt of the notice, and the customs will detain 
the suspected goods and notify the right owner in writing. Where the right owner fails to submit 
the qualified application and pay the deposit in a certain amount within the stipulated period, the 
customs will not detain the suspected goods. Th e customs will investigate and determine whether 
the suspected goods infringe intellectual property rights within 30 working days from the time of 
detainment. Chinese customs will adopt the same IPR protection measures for both export and 
import. 
 15. Could China please provide statistical data on the breakdown of actions on request, and on the 
own initiative of Customs?  
 
Answer 
In 2013, Chinese customs has adopted IPR protection measures for more than 23,600 times and 
suspended the release of 23,686 batches of su spected goods, which involved more than 
280 million pieces of suspected goods; the susp ected goods actually detained were 20,464 
batches, involving almost 76 million pieces of su spected goods. Among these goods, 38 batches 
were detained as applied, involving more than 490,000 pieces of goods, and 20,426 batches were 
detained ex officio, involving 75.45 million pieces of goods.  16. When IPR violating goods are interdicted, are those goods traced back to the Chinese 
manufacturer? If yes, please indicate what penalty actions then are taken?  
 Answer 
In accordance with Chinese laws, the customs has the right to impose administrative punishment on the consignors and consignees of the imported  and exported goods, which infringe intellectual 
property rights. Where the infringement meets th e standards to register a criminal case, the 
customs will forward the case to the public securi ty authority, which will investigate the producer 
and impose criminal punishment through criminal proceedings in accordance with laws.  4 - TRADE POLICIES BY SECTOR 
 
Page 138 (Paras 4.55 and 4.56)   
The China Banking Regulatory Commission is in the process of identifying and defining regulatory 
policies for shadow banking, and pays close attent ion to its development, problems and risks. It 
considers that it is at an early stage of development, relatively small in scale and with controllable 
risks, but nonetheless still needs to be further re gulated and standardized in order to effectively 
manage the risks. The measures under consideration in that respect include: first, further defining 
the division of responsibilities and clarifying the supervision and management responsibilities of all 
types of entities; second, defining supervision and segregation measures so as to promote WT/TPR/M/300/Add.1 
 
- 394 - 
 
  
 standardized development of all types of institutions and businesses; third, investigating the 
potential risks; and fourth, educating public opinion and consumers.   
Question 
17. Considering that the shadow-banking system emerged to meet the demand from private firms for extra liquidity to help them cope with th e slowing economy and fulfill their investment 
commitments, and also that the combination of easy credit, low official rates, and high demand 
caused property prices to surge in some Chinese cities over the last decade, what other measures is the China Banking Regulatory Commission taking directly to monitor Shadow Banking and to avoid a Real Estate bubble in China?  
 
Answer 
The rules set forth by the Financial Stability Board on the definition, types, functions and other 
issues of shadow banks have been commonly accepted in the international market. China has 
participated in the research conducted by FSB on the supervision methods related to shadow 
banks and keeps in line with the international practice. The shadow-banking system does not 
emerge to meet the demand from private firms for extra liquidity to help them cope with the 
slowing economy and fulfill their investment comm itments as described by Brazil. The shadow-
banking system is the inevitable outcome of financial development and financial innovation and has played a positive role in such aspects as  serving the physical economic and enriching 
residents' investment channels as a sound supple mentary force of the traditional banking system.  
 However, shadow banks also have such problems  as improper business, inadequate management 
and regulatory arbitrage. 
The regulatory policies stipulated by China on sh adow banks include: the policies to identify the 
responsibilities of various parties in social financing activities in relation to supervision and 
management and strengthen full supervision on social financing; the policies to promote the sound 
development of various institutions and businesses, urge various institutions to establish internal control and risk isolation mechanism and prevent risk expansion; the policies to reinforce supervision on various financial activities, lock up risks and maintain order in the local market; the 
policies to improve regulatory coordination and prevent regulatory arbitrage. The regulatory 
authorities shall collect industrial information, improve the information sharing mechanism and prevent regulatory arbitrage. 
 
For the purpose of preventing real estate risks, CBRC shall play its role from the following five aspects: to strictly follow the real state control policies and the differentiated housing credit 
policies promulgated by the State; to strengthen the prevention of risks related to real estate 
development enterprises and land reserve loans; to  improve risk management related to the loans 
for operating properties; to reinforce the local management on real estate credit risks; and to serve the construction of low-income houses based on the principles of controllable risks and 
sustainable business. 
 Page 143 (Para 4.79) 
 
In addition, in December 2012 the State Administra tion of Foreign Exchange (SAFE) issued the 
amended Announcement on the Promulgation of the Interim Provisions on Foreign Exchange 
Administration of Domestic Securities Investment by Qualified Foreign Institutional Investors 
(SAFE Announcement [2009] No.1, amended on the basis of SAFE Announcement [2012]No. 2), which relaxes the ceiling on investment quotas and the restrictions on fund remittances in and out of China. Foreign institutions are still required to obtain approval from CSRC to become QFIIs and 
apply to SAFE for investment quotas.  
 Question 
18. Which criteria are applied by CSRC to grant foreign institutions approval to become QFIIs and 
apply to SAFE for investment quotas?   
Answer 
Article 6 of the Measures for the Administration of Securities Investment within the Territory of 
China by Qualified Foreign Institutional Investor s (CSRC, PBOC and SAFE Decree No. 36) provides 
for as follows: a QFII applicant should fall within the following criteria: the applicant should be in WT/TPR/M/300/Add.1 
 
- 395 - 
 
  
 sound financial and credit status and should meet  the requirements set by CSRC on assets size 
and other factors; employees of the applicant sh ould meet the requirements on professional 
qualifications set by its home country/region; the applicant should have sound management 
structure and internal control system, should conduct business in accordance with the relevant 
regulations and should not have received any substantial penalties by regulators in its home country/region over the last three years prior to  application; the home country/region of the 
applicant should have sound legal and regulatory system, and its securities regulator has signed 
Memorandum of Understanding with CSRC and ha s maintained an efficient regulatory and co-
operative relationship. Article 8 provides for as follows: the CSRC shall, within 20 working days 
from the date the full set of application docu ments are received, examine the materials and 
determine whether to grant approval or not with reference to the opinions of SAFE. The 
Announcement of CSRC concerning the Notice on the Relevant Issues Concerning the Measures for the Administration of Securities Investment with in the Territory of China by Qualified Foreign 
Institutional Investors (CSRC Announcement [2012 ] No. 17) provides for detailed rules on the 
asset size of and application documents to be submitted by the applicant. Please refer to the website of CRSC (http://www.csrc.gov.cn) for details. 
 
PART II - QUESTIONS REGARDING THE GOVERNMENT REPORT   3 - TRADE AND INVESTMENT DEVELOPMENT AND RELATEDPOLICIES  
 
Page 20 (Para 3.33)  
Under the Catalogue of Investment Projects Subject to Governmental Verification 
(2013)promulgated in December 2013, the universal requirement that all foreign investment projects shall be subject to verification is ch anged to the requirement that foreign investment 
projects are subject to either verification or f iling based on different circumstances. That means 
only foreign investment projects in the restricted category, or foreign investment projects in the encouraged category requiring Chinese party as the major shareholder (including comparatively controlling shareholders) shall be still subject to verification. Other foreign investment projects, as 
domestic investment projects, shall be subject to either verification or filing in accordance with the 
general provisions.   
Question 
19. Is the Catalogue of Investment Projects Subjec t to Governmental Verification available online? 
If so, where? Is there an English version of the catalogue?  
 
Answer 
For details, please refer to: http://www. gov.cn/zwgk/201312/13/co ntent_2547379.htm. 
 
QUESTIONS REGARDING THE SECRETARIAT REPORT  
 2. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
 
Page 44 (Para 2.50 e 2.51)   
2.5 Foreign investment regime 
2.5.1 Regulatory framework and market access   Between 2012 and 2013, the State Administration of Foreign Exchange (SAFE) took measures 
aiming at simplifying rules governing FDI in China and easing restrictions on the use of capital for 
direct investments. The SAFE abolished 24 regulations containing requirements on foreign exchange registration and the opening and use of accounts; and introduced new rules focusing on 
simplified procedures and regulations for foreign currency registration, the opening and use of 
accounts, as well as the receipt and disbursement of capital and settlements. The restrictions on reinvestment in RMB for foreign companies were abolished. FIEs are now allowed to extend loans 
to offshore shareholders, although restrictions are still in place on the amount of such loans.  
Foreign investors may also be allowed to own some shares in State-controlled enterprises in certain sectors. There are no restrictions on lending by domestic banks to FIEs.   WT/TPR/M/300/Add.1 
 
- 396 - 
 
  
 Question 
In the text is said that "FIEs are now allowed to extend loans to offshore shareholders, although restrictions are still in place on the amount of such loans" and that "There are no restrictions on 
lending by domestic banks to FIEs". So, we would li ke to know if there are other restrictions of the 
same nature that are applied for FIEs?   
Answer 
As for FIE extending loans to offshore enterprises,  it means that domestic enterprises extend loans 
overseas. In January 2014, SAFE promulgated the No tice of the State Administration of Foreign 
Exchange on Further Improving and Adjusting Policies for Foreign Exchange Administration under 
Capital Accounts (Hui Fa [2014] No. 2), explicitly stipulating that the accumulated loans extended 
by domestic enterprises overseas shall generally no t exceed 30% of its owners' equity. In addition 
to such administrative measures on the amount of loans, China has also impose the corresponding 
conditions on the parties, i.e. domestic enterpri ses are solely permitted to extend loans to the 
offshore enterprises, which have sh areholding relationship with them. WT/TPR/M/300/Add.1 
 
- 397 - 
 
  
 27  QUESTIONS BY ASEAN 
REPORT BY CHINA  
 
Pg. 6, Paragraph 2.11;Pg. 11, Paragraph 2. 41; pp. 12, Paragraphs 2.45-2.47; pg. 19, 
Paragraph 3.26  We note that China has made several mentions regarding reforms on taxation, particularly with 
the pilot program on replacing business tax with value-added tax. China has also introduced tax 
incentives to benefit small enterprises with low profits. Furthermore, the pilot programmes scope 
of coverage has been applied to some major services sectors.   
As China mentions that the tax incentives that it has provided for SMEs are temporarily exempted, 
does China intend to provide any additional incentives to SMEs or a permanent exemption according to the income brackets that it has specified?  
 
Answer 
To support the development of SMEs, and balance tax burden of SMEs and individual businesses, 
since 1 August 2013, China has exempted temporarily enterprises or non-enterprise units with a 
monthly turnover no more than RMB 20, 000 among the small scale VAT payers from value-added tax, and exempted temporarily enterprises or no n-enterprises units with a monthly turnover no 
more than RMB 20,000 among the small scale busi ness taxpayers from business tax. We believe 
that the above tax exemption for SMEs is an im provement of the threshold of the current VAT 
system, and the threshold is an institutional arrangement applied universally in the world. Since the VAT system is in the process of reform in China, the above policies of tax exemption in the 
current stage belong to temporary policies of tax reduction and exemption. In the future when 
legislation is conducted for VAT, China will sort out and standardize various policies of tax reduction and exemption. There is no such plan for income tax. 
 
Also, does China envision expanding the VAT pilot programme to other trade activities besides Services and how long does China expect to implement this pilot programme?   
Answer 
China started the VAT pilot programme on 1 January 2012. Now this pilot programme has been 
carried out in transport, postal services, teleco mmunications and some modern services across the 
country. According to the arrangement of VAT programme, the Ministry of Finance is consulting 
relevant departments on the VAT plan in the fields of daily life services, construction, real estate and finance, striving for full completion of the VAT reform within the Twelfth Five Year Plan period.  
 
Pg. 17, Paragraph 3.16  China mentioned that it continues to transform the development pattern of foreign trade, in order to restructure it and to strengthen pragmatic cooperation with its trading partners, to achieve 
mutual benefit and common development in prom oting balanced and sustainable development of 
trade and investment.   
Answer 
China has promoted export level and balanced development of trade. China has stabilized and 
improved policies on export, accelerated reform for facilitating clearance, expand pilot 
programmes of across – border e-commerce. China encourages to implement export policies and 
increase import of goods lacking in the country . China has led transformation and upgrade of 
processing trade, supported enterprises to crea te self-independent brands and international 
marketing network, developed service trade and outs ourcing, and raised the position of "made in 
China" in international labor division. China encourages exports of large sized complete sets of 
equipment of telecommunications, railways and power stations, and promotes reform of foreign investment and management pattern, taking filing as the major method, delegating by a big 
margin approving power to lower levels. China has improved guarantee for financial service, law 
service and consul service, standardized order of going global, promoted export of products, 
project contract and labor cooperation. China has coordinated bilateral and multilateral and  
regional cooperation in opening to each other, promoted negotiations on service trade agreement, 
government's procurement agreement, information technology agreement, etc., and accelerated negotiations on new issues such as environmental protection and e-commerce. China has actively WT/TPR/M/300/Add.1 
 
- 398 - 
 
  
 participated in construction of the high standa rd FTA, promoted Sino - U.S. and Sino-Europe 
negotiations on investment agreements, and a ccelerated negotiation process on FTA between 
China and Rep. of Korea, Australia, and the Gulf Cooperation Council.  
 
In the next step, China will enhance cooperation with trade partners based on the principle of mutual benefit and win-win, jointly promote liber alization and facilitation of global trade and 
investment, so as to promote world peace and prosperity. Chinese government will actively carry 
out regional cooperation, build the "Silk Road Ec onomic Belt" and "Maritime Silk Road in the 21
st 
Century", accelerate construction of infrastructu re connecting neighbouring countries. China will 
promote negotiations on FTA, promoted Sino-ASEAN FTA to a higher level, so as to achieve win-
win between China and ASEAN.  WT/TPR/M/300/Add.1 
 
- 399 - 
 
  
 28  PREGUNTAS DEL ECUADOR 
Informe de la Secretaría 
 
1. De conformidad con la Sección 3) Políticas y Prácticas Comerciales por Medidas, 3.1.6 
Prohibiciones, restricciones y licencias de importación, página 73, párrafo 3.30, "la legislación china también autoriza a las autoridades a restringir las importaciones para favorecer el 
establecimiento de una rama de producción nacional específica o para acelerar su desarrollo. Las 
importaciones de productos agrícolas, de origen animal y pesqueros también se pueden restringir cuando las circunstancias lo exijan (artículo 16 de la Ley de Comercio Exterior). Según las autoridades, esta disposición no se ha aplicado nunca". No obstante su no aplicación, podría China 
indicarnos: 
¿Cuáles son las normas y leyes que permiten restringir las importaciones para favorecer el establecimiento de una rama de producción nacional específica? Cómo se justifica esta medida en 
función de la normativa multilateral? En virtud de esa Ley, qué mecanismos se contemplan para 
restringir las importaciones y en qué ramas?  
Answer 
In reality, the Chinese Government has never adopte d the measures of restriction or prohibition in 
import/export under paragraphs 7 and 8 of Article 16 in the Foreign Trade Law. China has never and will never maintain any import restriction measures, which are not in compliance with WTO 
rules.  
 ¿En qué circunstancias se puede también restringir las importaciones de productos agrícolas y 
pesqueros? 
 Answer 
China has implemented access system of inspection and quarantine on import of certain agricultural products and fish products to allow the export of those products going through risk assessment and relevant registration procedures and meeting China's inspection and quarantine 
standards to China. This measure is designed to safeguard food safety rather than restrict import 
and conforms to the WTO rules. 
 2. De conformidad con la Sección 3) Política s y Prácticas Comerciales, por Medidas, 3.1.4 
Aranceles, página 66, párrafo 3.14, "los tipos de los derechos provisionales son inferiores a los 
tipos NMF y, en algunos casos, solamente se aplican a una parte de una línea arancelaria". Al referirse a una línea arancelaria entendemos se trata de un producto específico, cómo entonces 
se aplican esos derechos provisionales, en algunos casos, solamente a una parte de una línea 
arancelaria? Quizás se refiere a qué una parte de las importaciones, abarcadas por esa línea arancelaria, se beneficiarían de un derecho provisio nal inferior al derecho NMF? De ser así, cómo 
se justifica ello conforme las disposiciones de la normativa OMC? 
 
Answer 
Provisional tax rate is applicable to certain commodities under tax items marked by ex as 
stipulated in the Import and Export Tari ff of the People's Republic of China.  
 3. De conformidad con la Sección 3) Política s y Prácticas Comerciales, por Medidas, 3.2.2 
Impuestos, cargas y gravámenes a la exportación, página 90, párrafo 3.90, respecto al "Cuadro 
3.9 Tipos de derechos de exportación por capítulo del SA, 2013" y su Protocolo de Adhesión a la OMC: "China eliminará todos los impuestos y cargas a la exportación salvo en los casos previstos expresamente en el anexo VI (productos suje tos a derechos de exportación) del presente 
Protocolo o que se apliquen en conformidad con las disposiciones del artículo VIII del GATT de 
1994". En el cuadro 3.90 se mencionan a ciertos capítulo s del SA, sujetos a derechos de exportación, que 
comprenden productos no considerados en el citado anexo? Podría China indicarnos cómo estos 
derechos se ajustan al compromiso establecido en su Protocolo de Adhesión?  WT/TPR/M/300/Add.1 
 
- 400 - 
 
  
 Answer 
In consideration of environmental protection and natural resource protection, China has levied 
export tariff on certain resource and energy-intensive products. China has maintained stable 
number of tax items applicable to export tariff in recent years.  
 4. De conformidad con la Sección 4) Políticas Comerciales por Sectores, 4.1.3.1 Medidas en la 
frontera, página 143, párrafo 4.12, respecto de que "las importaciones de algodón fuera del 
contingente pueden estar sujetas a un derecho variable basado en una fórmula, que depende del precio del algodón, pero sin exceder del 40% (es decir, del tipo consolidado para el algodón). Con arreglo a ese sistema, China fija un precio de umbral (14 RMB/kg en 2012 y 2013). Las 
importaciones están sujetas a un derecho específico de 0,57 RMB/kg cuando su precio es igual o 
superior al precio de umbral; cuando el precio real de importación es inferior al precio de umbral se aplica un tipo ad valorem  basado en la fórmula". 
Al fijar un precio de umbral que determina la aplicación de un derecho específico o ad valorem , 
dependiendo de que si el precio de la importación es igual / superior o inferior al precio umbral, respectivamente, podría China explicarnos: ¿Cómo la fijación de un precio umbral, que podría 
considerarse como un valor fijo, permite que el valor en aduana de la mercancía importada se 
base en el valor real de las mercancías (precio de transacción)?  Answer 
China imposed provisional tariff in the form of slid ing duty less than 40% as  applicable tariff rate 
of non-quota cotton import in 2012 and 2013: when import price is too low (below RMB14/kg), ad 
valorem tariff rate is subject to the formula of sliding duty, and specific tariff at a rate of 
RMB0.57/kg is applicable to other circumstances.  
 Qué objetivo se persigue al aplicar este umbral  para la determinación del derecho de aduana, 
específico o ad-valorem ? 
 Answer 
China's objectives are to promote cotton import and give comprehensive consideration to interests 
of upstream and downstream industries.  
 5. De conformidad con la Sección 4) Políticas Comerciales por Sectores, 4.1.3.1 Medidas en la 
frontera, página 144, párrafo 4.14, respecto que "el IVA aplicable a los productos agrícolas 
nacionales e importados es del 13%. Sin embargo, los productos agrícolas producidos y vendidos directamente por pequeños agricultores siguen estando exentos del IVA". Podría China 
explicarnos: 
¿Cómo esta excepción del IVA a favor de los pequeños agricultores nacionales se justifica bajo las disposiciones de no discriminación, específicamente, trato nacional?  
Answer 
According to China's existing tax system, self-produ ced agricultural products sold by agricultural 
producers are exempted from VAT for the sake of VAT administration under household contract 
system and scattered operation conditions in China.  Most agricultural producers in China are small, 
but the policy does not target at small farmer households. Generally speaking, agricultural products will reach consumers through circulation link in which tax is levied on agricultural 
products. Therefore, tax levied on imported agricultural products is by no means a discrimination 
treatment.   6. ¿Tienen en cuenta las normas sanitarias de acceso al mercado de China las 
recomendaciones de los Organismos Internacionales de Referencia (CIPF, Codex Alimentarius , 
OIE)?  
Answer 
Pursuant to the Food Safety Law of the People's Re public of China, food safety standards shall be 
formulated for the purpose of safeguarding the public health, on a basis of results of food safety 
assessment and in a scientific, rational, safe and reliable way. Therefore, China has developed and 
amended national food safety standards that co nform to internationally-accepted practices and 
China's national conditions by referring to st andards formulated by the Codex Alimentarius 
Commission and other international organizations and countries and in accordance with the results WT/TPR/M/300/Add.1 
 
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 of China's food safety risk assessment, food consumption, dietary structure and development 
situation of food industry. On the other hand, Chin a has notified the proposed national food safety 
standards to the WTO and WTO Members by following procedures and in accordance with the WTO 
requirements, and has replied to comments by various members. 
 7. ¿Qué estatus tiene la China en cuanto a la erradicación de la fiebre aftosa?  
 
Answer 
The Chinese Government has attached great importance to foot-and-mouth disease (FMD) prevention and control. Asia I-, A- and O-type  FMD epidemics successively broke out in some 
regions in China in recent years. The Chinese Government has adhered to the prevention and 
control guideline of leadership enhancement, close coordination, dependence on science, prevention and control in accordance with law, gr oup prevention and control and resolute disposal 
and has implemented comprehensive prevention and control measures combining immunization 
and elimination to effectively control FMD epidemic which has shown a significant downtrend nationwide. No Asia I-type FMD epidemic has occurred in China since June 2009. To date, no Asia 
I-type FMD epidemic has happened in China for 61 consecutive months and O- and A-type FMD 
epidemics only broke out in scattered regions. In 2012, the Chinese Government issued the National Medium- and Long-term Plan for Animal  Epidemic Disease Prevention and Treatment 
(2012-2020) to define 16 domestic animal epid emic diseases preferential for prevention and 
treatment including FMD. Currently, the Ministry of Agriculture has worked with relevant 
departments to develop the plan for FMD preventi on and treatment. In the future, the Chinese 
Government will concentrate on implementing th e plan for FMD prevention and treatment and 
advance FMD prevention and treatment in an all-round way in accordance with established 
objectives and requirements.   
8. ¿Qué tipos de apoyos directos a la agricultura sujetos a compromisos de reducción aplica la 
China en cereales de consumo animal y cereales de consumo humano?  Answer 
Specific information is subject to the domestic support notification submitted by China to the WTO.  WT/TPR/M/300/Add.1 
 
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 29  QUESTIONS BY THAILAND 
QUESTIONS REGARDING THE SECRETARIAT REPORT 
 
3. TRADE POLICIES AND PRACTICES BY MEASURE 
 Page 117 (paragraph 3.234)  
 
Question 1 Reading the Report, we understand that the methods and amounts of payment of remuneration to the copyright owners for broadcasting musi cal works are subject to agreement between 
broadcasting organizations and the copyright collec tive administration organization. In case that 
they cannot agree on the method or payment, how does the system function? Can one of the parties seek a solution through the judicial authority (e.g. a court) or is there any mediation 
mechanism for them to reach a mutual agreement? 
 Answer 
Please refer to Article 2 of the Interim Measures on Payment by Audio and TN Station for Broadcasting Audio Products. Where a dispute arises over the remuneration paid in accordance with the provisions of these Measures between a radio or television station and the copyright 
owners or the copyright collective administration organization, either party may bring civil 
proceedings in a people's court in accordance with law or apply to an arbitration body for 
arbitration under a written arbitration agreement reached between the parties. 
 
Page 120 (paragraph 3.251)  
 Question 2 
We would like to learn more about China's Online Sword Campaign and China's voluntary 
monitoring of video websites. How do these systems work? Are these two campaigns different? To whom do they apply and what does China provide as incentives for them to voluntarily monitor the video websites? 
 
Answer 
Details for the Online Sword Campaign  please refer to below website: 
http://www.ncac.gov.cn/chinacopyright/channels/4512.html. 
 Page 120 (paragraph 3.252)  
 
Question 3 Please elaborate more on China's campaign advocating the application of copyrighted software. By which instruments does China apply to help promote the application of copyrighted software? 
 
Answer 
The Chinese Government attaches great importance to copyrighted software. In 2001, China 
launched the action to promote the use of copyrighted software in governmental organs. 
Copyrighted software began to be used in central, provincial and local and municipal governmental organs in 2002, 2004 and 2005, respectively. In January 2012, the State Council adjusted the 
inter-ministerial joint conference which was initially set up to promote the use of copyrighted 
software among enterprises to the inter-ministry joint conference among 15 ministries including MIIT and MOF under the leadership of former Ge neral Administration of Press and Publication 
(NCAC), and set up the permanent working mechanism to coordinate the promotion of the use of 
copyrighted software among governmental organs and enterprises with a view to strengthening 
the organization and leadership regarding the us e of copyrighted software. By the end of 2013, 
upon the inspection and rectification among central, provincial and local and municipal 
governmental organs regarding copyrighted softwa re, the governmental organs at various levels 
have purchased 5,920,900 sets of operation system and office and antivirus software in an amount of RMB 3.438 billion, and the amount of the purc hased foreign software reached RMB 2.267 billion, 
accounting for 66% of the total purchase payment. In August 2013, the General Office of the State 
Council promulgated the Administrative Measures for the Use of Copyrighted Software by Governmental Organs, further promoting the use of copyrighted software. WT/TPR/M/300/Add.1 
 
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 4. TRADE POLICIES BY SECTOR  
 Page 124 (paragraph 4.2)  
 
Question 4 Thailand is interested in China's 12
th Five-Year Plan which calls for an increase in grain production 
and builds stocks to ensure price stability. Could China elaborate more on the policy goal, its 
implementations, including measures undertaken, th at are related to the increase in support and 
benefit to farmers?  
Answer 
In accordance with the Outline of the Twelfth Five-Year Plan for National Economic and Social 
Development of the People's Repu blic of China, China's grain productivity will reach more than 
540,000,000 tons and the per capita net income of  rural residents will exceed RMB 8310 by the 
end of the 12th five year. In order to realize such targets, the Chinese government has adopted 
relevant policy measures, including reinforcing protection on farmland and water resources, 
increasing investment in infrastructures of farm land and speeding up scientific and technological 
development of the agricultural sector. Since the 12th five year, China's grain output and farmers 
income have kept growing.  
Page 124 (paragraph 4.3) 
 Question 5 
Could China give more detail on its direct subsidies granted to farmers? What are the criteria of 
farmers to be eligible for such subsidies and how does the system work? Thailand is also interested in China's transfers direct to poverty-stricken rural areas to benefit impoverished farmers. How 
does the Central Government consider a particular area or one farmer to be eligible for such 
transfers? Are direct subsidies and transfers the same or different programs? Can one farmer be eligible for both payments?   
Answer 
Direct subsidies and transfers are different. For the purpose of benefiting poor farmers in poor 
rural regions, the central fiscal has set up the special fiscal poverty alleviation fund to support poor 
rural regions to improve their production and living conditions and help poor farmers to get rid of 
poverty and become rich. In 2011, China promulgated the Outline for Development-oriented Poverty Reduction for China's Rural Areas (2011-2020)  (the Outline), explicitly identifying the key 
region and the key subjects under the poverty alleviation program. The Outline identifies 
14 contiguous poor areas with special difficulties around China, places the main battlefield in these areas and confirms that the key counties and villages in the national poverty alleviation and development program are also the main regions in the poverty alleviation and development 
program. In addition, the rural population with working capacity but below the poverty alleviation 
threshold are the key subjects in the poverty a lleviation and development program. In 2013, the 
poverty alleviation threshold of China is RMB 2,300 per person for rural residents (remaining the 
same since 2010). Where a farmer meets the standards for direct subsidies and transfers at the 
same time, the farmer will obtain both direct subsidies and transfers.  
Pages 124-125 (paragraph 4.4)  
 Question 6 After learning about specific objectives of China's 12
th Five-Year Plan, Thailand would like to know 
about the key factors/reasons for them, especially for the increase in minimum purchase prices for 
key grains? Could China explain more on how it implements these objectives?  
Answer 
Currently, China adopts minimum purchase price policy regarding the rice and wheat from the 
main production areas. In recent years, the planti ng cost of rice and wheat has been increased by 
a large proportion. As such, China has properly raised the minimum purchase price in order to 
protect farmers enthusiasm in planting and stabilize the production of rice and wheat.  WT/TPR/M/300/Add.1 
 
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 Page 127 (Table 4.3) 
 Question 7 
Is there any special policy for importation of the main agricultural products that are subject to 
tariff quotas which exceed its import quota, such as sugar, wool and cotton? Does China plan to modify the quotas or out-quota tariff rates of such products? 
 
Answer 
The agricultural products subject to import tariff- rate quotas include maize, wheat, rice, sugar, 
cotton and wool, and the tariff-rate quotas of which are applicable around the world. In addition, 
China also imposes country tariff-rate quota on wool from New Zealand in accordance with the 
Free Trade Agreement between China and New Zealan d. China is duly performing its commitments 
to WTO, and imposes no special policies on out-qu ota import of sugar and imposes sliding duties 
on out-quota import of cotton. Currently, China ha s no plan to modify the quotas or out-quota 
tariff rates of agricultural products.  
Pages 127-128 (paragraph 4.14) 
Question 8: What are the criteria for small-scale farmers to be eligible for VAT exemption of their products? Could China elaborate more on how it implements the measure?   
Answer 
According to the current taxation rules of China, the self-produced agricultural products sold by 
agricultural producers are exempted from VAT. Agriculture refers to planting, breeding, forestry, 
husbandry and fisheries. Agricultural producers include the entities and individuals engaged in 
agricultural production. The agricultural products purchased and the agricultural products produced 
and processed from the purchased agricultural prod ucts and sold by such entities and individuals 
are subject to VAT at the stipulated rate. 
 Page 130 (paragraph 4.23)   
Question 9 
In what forms (i.e. direct cash or other means) are the direct subsidies that the Government grants to farmers? How does the Government distribute such subsidies? Do both local and central 
governments involve in the distribution and consideration for eligibility?  
 Answer 
In terms of direct subsidies to farmers s' income, China has generally directly released the cash to farmers based on the taxable land area with fixed basic period and by ways of one card or one deposit book. In practice, all the farmers contracting lands are eligible to obtain subsidies.  
Page 131 (paragraph 4.28) 
 Question 10 
Could China elaborate more on the price control of some commodities and important reserve 
materials? What are the reasons behind selecting those commodities and materials? Could China provide the full list of the commodities and materi als? When will the revision of the Catalogue of 
Reserve Materials be finished?  
 Answer 
At present, the price of China's reserve materials has been opened up. The State has not directly 
set the price of reserve materials and not formulated the so-called list of the important reserve 
materials.  WT/TPR/M/300/Add.1 
 
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 QUESTIONS REGARDING THE GOVERNMENT REPORT 
 Page 9 (paragraph 2.27) 
 
Question 11 Could China give a summary of the new and/or revised IP legislations/regulations? For example, 
what are the key points of the newly amended laws, including trademark, computer software, 
copyright, and communication right through information network? Could China provide the English version or an English summary of these newly amended laws?  
Answer 
Since 2012, China has amended the trademark la w, the implementation regulations on the 
trademark law, the implementation regulations on  the copyright law, the regulations concerning 
the protection on the communication right through information network, the regulations 
concerning the protection on computer software and the regulations concerning the protection on new varieties of plants mainly as follows: (1 ) in 2013, China amended the provisions in the 
implementation regulations on the copyright law, the regulations concerning the protection on the 
communication right through information network, the regulations concerning the protection on computer software and the regulations concerning the protection on new varieties of plants on the amount of penalties, strengthening the punish ment on infringement. The decisions on such 
amendments took effect from 1 March 2013. (2) China amended the trademark law in 2013 and 
amended the implementation regulations on the trademark law in 2014, simplifying the objection procedure of trademark registration, reinforcin g the protection on the exclusive right of 
trademarks, strengthening the punishment on infringement and raising the indemnity amounts for 
infringement. The decisions on such amendments took effect from May 1, 2014.  
OTHER QUESTIONS 
 Question 12 Are there any performance requirements for foreign invested enterprises under the China 
(Shanghai) Pilot Free Trade Zone (CSPFTZ) and the pilot programme of levying value-added tax in 
lieu of business tax, such as technology transfers, ratio of domestic to foreign staffs, and research and development requirements? If so, please pr ovide detail on performance requirements under 
such pilot projects. 
 Answer 
There is no performance requirement for foreign invested enterprises under the China (Shanghai) Pilot Free Trade Zone (CSPFTZ) and the pilot programme of levying value-added tax in lieu of business tax. Foreign invested enterprises are entitled to national treatment and will not be entitled to any different taxation treatment as they are foreign invested enterprises. 
 
Question 13 In order to promote balanced development of international trade, the Chinese Government has 
increased participation of SMEs in the global trade. Thailand would like to learn more about this 
policy/scheme. Does this policy/scheme include su pporting the cooperation between Chinese SMEs 
and enterprises from other countries, particularly ASEAN countries? Could China elaborate more on 
this policy/scheme. 
 Answer 
Please refer to Item 47 in China's SCM notification, which is listed in G/SCM/N/155/CHN and 
G/SCM/N/186/CHN. WT/TPR/M/300/Add.1 
 
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 30  QUESTIONS BY MYANMAR 
Page 59 Paragraph (3.15.) 
Applied tariffs and tariff structure  
 
It is noted that 47 tariff lines are subject to tariff rate quotas (Section 4.1), including in HS Chapters 10 (wheat and meslin, maize, rice), 11 (cereal flours other than of wheat and meslin, 
cereal groats), 17 (cane or beet sugar), 31 (miner al or chemical fertilizers), 51 (wool, carded or 
combed), and 52 (cotton).   Question 1 
Could you please provide details on how quota quantity for each of those 47 tariff lines is allocated 
to the trading partner countries? Can you also share information on the quota quantity of maize, rice, cane and fertilizer to be allocated for Myanmar in 2014 – 2015 and 2015-2016 fiscal years, 
along with tariff rate and other taxes to be levied on these products?  
 Answer 
The import quotas for the above products are glob al quotas. When such quotas are allocated to 
enterprises, these enterprises will decide on th eir own from which countries the products are 
imported. As for the tariff rates of these products, please refer to the Import and Export Tariff of China. 
 
Page 77 Paragraph (3.78) Sanitary and Phytosanitary requirements  
 
The report states: "Another salient feature of China's SPS system is the fragmentation of regulatory authorities among different Government agencies. Currently the Ministry of Health 
(MOH), the Ministry of Agriculture (MOA), AQSI Q, the State Administration for Industry and 
Commerce (SAIC), MOFCOM, and the State Food an d Drug Administration (SFDA) are actively 
involved in regulating the SPS regime (Table 3.8)."   
Question 2  
As we all know, mutual recognition of Certificates is very significant in SPS regime. Regarding SPS inspection at entries and exits, do those six different Government agencies recognize certificates 
issued by the exporting countries? How many countries have already signed Mutual Recognition 
Agreement with China? Please clarify the conditions and process for reaching Mutual Recognition Agreement under SPS regime.  
 
Answer 
We are in process of coordinating with competent authorities for reply.  
Page 77 Paragraph (3.79)  
Sanitary and Phytosanitary requirements  
The report states : 'China can prohibit imports of any animals and plants that originate in countries 
or regions with prevalent epidemics or plant dise ases, based on a risk analysis, through a joint 
order issued by the Ministry of Agriculture and AQSI Q. The prohibition can be lifted on the basis of 
scientific assessment. However, to lift a prohibition the country needs to submit an application to 
the relevant Chinese authorities once the epidemic has been controlled. The MOA and AQSIQ will jointly assess the application, and an on-site survey  will be carried out to assess whether the steps 
taken to control the disease are in accordance with a risk analysis based on the principles 
stipulated by national and international organizations. Thereafter the MOA and AQSIQ will jointly 
solicit comments on the risk analysis report from the relevant national bodies. China will also submit the report to the countries affected by the prohibition to obtain their comments and 
feedback. If there are disagreements on China's assessment of the country's sanitary conditions, 
China might request more evidence to re-assess the risk based on the new evidence.'   WT/TPR/M/300/Add.1 
 
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 Question 3 
When a prohibition of imports is made, is the notification sent only to the target country or to the WTO Secretariat or both? How long does the process of scientific assessment normally take for 
lifting a prohibition? Is there any early warning system or mechanism under SPS regime? If so, 
please elaborate on it.   
Answer 
We are in process of coordinating with competent authorities for reply. WT/TPR/M/300/Add.1 
 
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 31  QUESTIONS BY TRIN IDAD AND TOBAGO 
Report by the World Trade Organization (WTO) Secretariat (WT/TPR/S/300) 
 
2. TRADE AND INVESTMENT REGIME  
2.2.2 Trade Policy Objectives   
Paragraph 2.26 (page 39)  
Can China elaborate on the exiting market access barriers? What are the initiatives being undertaken to remove existing market access barriers?   
Answer 
China seriously honors its WTO commitments to provide foreign investors with a unified, fair, 
transparent and legal business environment.  
 
2.3 Participation in the World Trade Organization   
Paragraph 2.32 (page 40) 
Does China have a proposed timeframe by which it s notification in the area of agriculture and 
subsidies would be updated?   
Answer 
The notification covering 2009-2010 is being prepared. China will accelerate the process and 
provide it to WTO in time. 
 
2.4  Regional Arrangements 2.4.1 Reciprocal Agreements 
 
Paragraph 2.36 (page 40) Of the 12 FTA's concluded by China, does any includ e a Trade in Services Agreement? If yes, what 
was the approach used to liberalize trade in services in the FTAs?  
 
Answer 
At present, the free trade agreements China has signed include trade in services, and all 
commitments on trade in services are based on a positive list.  
 3. TRADE POLICIES AND PRACTICES BY MEASURE 
3.1.1 Customs Procedures and Requirements  
 Paragraph 3.7 (page 57) Can China provide details of the Institution to be  contacted to seek redress with respect to the 
importation of returned/damaged goods by a foreign importer? Can China also elaborate on the 
administrative procedures?   
Answer 
Returned goods refers to the goods that are retu rned outbound or inbound because the original 
imported and exported goods are damaged, in shortage, poor quality or failure to meet 
specifications, and delayed in delivery, or for other reasons. 
Firstly, we need to know whether it's an import issue or export one. If the "foreign importer" here refers to the importer from Trinidad and Tobago , the above two issues involve China's supervision 
and administration on export goods. Generally, the majority of export goods do not involve 
taxation. If the export goods are returned for such reasons as damage and others, apart from 
going through normal customs formalities, quality inspection department shall also issue inspection and quarantine certificate, and details of the procedures. 
 WT/TPR/M/300/Add.1 
 
- 409 - 
 
  
 3.1.8 Standards and Technical Requirements  
 Has China implemented any measures to ensure compliance and improve consistency in the 
quality assurance standards of its products? If so, please provide details of these measures?  
 Answer 
The Standardization Administration is working to  simplify and modernize the standard system, and 
is actively involved in revi sing the Standardization Law. 
 WT/TPR/M/300/Add.1 
 
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 FOLLOW-UP QUESTIONS BY THE EU 
Page 42 Para 2.43 on regulatory reforms 422.43 
 
The Paragraph describes the main laws specifically related to foreign-invested enterprises (FIEs). 
In early 2014, The Ministry of Commerce called for public comments on the Sino-Foreign Equity 
Joint Venture Enterprise (EJV) Law, the Sino-For eign Cooperation Joint Venture (CJV) Enterprise 
Law and on the Wholly Foreign-Owned Enterprise (WFOE) Law, with a view to reform the system. 
2014  EU Question 2 
Could China elaborate on the intended direction of the planned legislative change, and what is the 
timeline for this reform? Has there been any consideration of merging the EJV, CJV and WFOE laws with the Chinese company law, so as to provide a non-discriminatory treatment between domestic 
and foreign companies?  
 Answer 
The Decision on Major Issues Concerning Comprehensively Deepening Reforms calls for establishing fair, open and transparent market rules and exploring the management of foreign investment based on Pre-establishment National Treatment and Negative List. Currently, the Chinese Government is actively promoting the re form of foreign investment management system. 
Following the requirement of unifying domestic an d foreign investment laws and regulations, the 
Government is researching on the revision of the Law on Chinese-Foreign Equity Joint Ventures, the Law on Chinese-Foreign Cooperative Joint Ventures and the Law on Foreign Investment 
Enterprises, so as to create a clear, transparent and stable legal system for foreign investment and 
further enhance policy transparency.  
1. EU Follow-up question to initial EU Question 2 
Can China provide an indicative time frame for the reviewing and unification of domestic and foreign investment laws?   
Answer 
Currently, we are actively and steadily promoting the institutional reform of foreign investment 
management, amending applicable laws and regulations and exploring the administrative mode of 
pre-establishment national treatment and negative list on foreign investment. In 2013, China 
established China (Shanghai) Free Trade Pilot Zone and developed the relevant pilot programs of foreign investment management. In the next st ep, China will evaluate the pilot programs to 
acquire the experience which may be reproduced and promoted. 
 Page 42 Paras 2.45, 2.46 and 2.47   
The Investment Catalogue governs investment access to different sectors in China and was last 
revised in 2011. The Report notes that investment projects deemed to employ outdated technologies, over-exploit scarce natural resources or harm the environment are restricted. 2011 
 
EU initial Question 3 Chinese authorities suggested that in the future the Investment Catalogue will be completely 
abolished and replaced with a negative list applicable across the entire territory of the country. 
Can China provide more details abou t the timeline of this reform?  
 Answer 
By exploring the establishment of a foreign investment management system based on Pre-establishment National Treatment and Negative List, the Chinese Government will actively promote the reform of its foreign investment ma nagement system, and unify domestic and foreign 
investment laws and regulations, so as to en sure stable, transparent and predictable foreign 
investment policy, and further promote investment facilitation.  WT/TPR/M/300/Add.1 
 
- 411 - 
 
  
 2. EU Follow-up question to initial EU Question 3 
While appreciating the answer given, the EU would like to know whether there is a timeline for this 
reform and if so, what is it?  
 
Answer 
Please refer to the above reply on Follow-up question to initial EU Question 2. 
 
Page 44 Para 2.51  The Report states that foreign investors may be allowed to own some shares in state-controlled 
enterprises in certain sectors.  
 EU initial Question 6 
Could China clarify which are the state-controlled enterprises that foreign investors are allowed to 
invest in, and whether there are any limitations,  for example the overall percentage of foreign 
capital or categorisation of an SOE? What are the criteria for deciding which sectors and 
enterprises are included in this scheme? How is the scheme likely to evolve in light of reforms of 
SOEs and of the foreign investment regime?   Answer 
In 2010, the Chinese government released the Opinions of the State Council on further Utilizing Foreign Investment, encouraging foreign capital to participate in the reshuffling, restructuring, merging and reform of domestic enterprise, includ ing state-owned enterprises, by means of joint 
stock and acquisition. The Catalogue of Industries for Guiding Foreign Investment is the policy 
guidance for approving foreign investment projec ts and foreign investment enterprises. Foreign 
investors may refer to this catalogue when investing in Chinese enterprises.  
 
3. EU Follow-up question to initial EU Question 6 The decision to potentially allow foreign investors to own State owned entities' shares, as outlined 
by the Report, is a recent one and to our knowledge not covered by the 2010 State Council 
Opinion China refers to in its reply. Further, to the EUs knowledge, the Investment Catalogue does 
not in fact provide the information sought in the original question.   
-Therefore, could China elaborate on which are th e state-controlled/State owned enterprises that 
foreign investors are allowed to acquire shares in, and whether there are any general limitations, for example the overall percentage of foreig n capital or categorisation of an SOE?  
 
Answer 
China encourages foreign investors to participate in restructuring and reform and merger and acquisition of domestic enterprises through equity participation and M&A, including state-owned 
enterprises. Currently, China has not imposed general restrictions (e.g. limits on shareholding 
percentage) on foreign investors who invest in state-owned enterprises. While investing in a state-owned enterprise in a particular sector in China, the foreign investor must refer to the Catalogue 
for the Guidance of Foreign Investment Industries and other requirements stipulated in industrial 
laws and regulations on the percentage of shares to be held by foreign investors as well as current laws and regulations of China on examination and approval procedures. 
 
Currently, SASAC is speeding up the shareholding restructuring of state-owned enterprises and 
proactively developing the mixing ownership economy with cross shareholding and mutual integration involving such factors as state-owned capital, collective capital and non-public capital 
in accordance with the requirements rais ed in the Third Plenary Session of the 18
th Central 
Committee of the CPC.  WT/TPR/M/300/Add.1 
 
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 Page 46 Para 2.57462.57 
 The Report mentions the draft Administrative Meas ures for the Verification and Approval and the 
Record-filing of Foreign Investment Projects. Since the WTO Secretariat Report was drafted, NDRC 
issued the revised Administrative Measures.   
EU initial Question 7 
Could China detail what the main changes are and what was the rationale for them?   Answer 
The Chinese Government intends to reform its foreign investment approval system, and explores the management of foreign investment based on Pre-establishment National Treatment and Negative List approach. In December 2013, the State Council released the Notice of the State 
Council on Issuing the Catalogue of Investment Pr ojects Subject to the Approval of Government 
(2013 edition), specifying the scope for foreign inve stment that are subject to the approval of the 
government. In May 2014, NDRC released the Regulation on the Approval and Recordation of 
Foreign Investment Projects, which revises the co mprehensive approval approach into the limited 
approval plus general recordation approach. The regulation seeks to explore the provision of 
National Treatment to foreign investments in respect of market access management, and simplifying the rules and procedure fo r foreign investment management.  
 
4. EU Follow-up question to initial EU Question 7 Could China explai n the differences 
 
Answer 
The comprehensive approval refers to the approval system applied to all foreign investment 
projects. According to the relevant requirements of the Catalogue of Investment Projects Subject 
to Government Verification (2013 Edition), Administrative Measures on Approval and Filing of Overseas Investment Projects (Decree No.12 of NDRC) reformed the administrative approach of foreign investment projects, transforming the co mprehensive approval into the limited approval 
plus general recordation approach, and trying out national treatment to accession. According to 
this reform, foreign investment projects controlled by the Chinese party (including encouraged projects and limited projects subject to relative controlling by the Chinese party) in Catalogue for 
the Guidance of Foreign Investment Industries and listed in Item 1 to 11 in the Catalogue of 
Investment Projects Subject to Government Veri fication (2013 Edition) apply to the approval 
approach, while other foreign investment projects apply to recordation approach. 
 
Page 51 Para 2.80   The Report notes the decision to integrate all th e special Customs supervision areas and establish 
a single Free Trade Zone.  
 EU initial Question 8 
Are there plans to establish further FTZs along th e lines of the CSPFTZ? If so, would these also 
function as pilot zones for testing of reform policies?   
Answer 
Currently, the overall plan of CSPFTZ has been generally implemented, within the framework of 
which the opening-up of 23 service sectors have also been realized. In the future, other sectors will be further opened up according to actual needs. 
 
5. EU Follow-up question to initial EU Question 8 The EU would like to reiterate its question are there plans to establish further FTZs in other areas 
that would follow the model of the CSPFTZ? If so, would these also function as pilot zones for 
testing of reform policies?  WT/TPR/M/300/Add.1 
 
- 413 - 
 
  
 Answer 
It is proposed in the Third Plenary Session of the 18th Central Committee of the CPC that some 
regions with proper conditions may develop free trade parks (or ports) based on the current pilot 
programmes. China will consider when and where to establish such new free trade parks with 
comprehensive consideration and according to the needs of reform and open-up and institutional 
innovation. Currently, China is focusing on Shanghai Free Trade Pilot Zone and has no plans to 
approve the establishment of other free trade zones. When establishing new free trade zones in 
the future, China will still focus on exploring new ways and new modes of reform and opening-up.  Initial EU Question 9 
Page 52, paragraph 2.83  states that "trade facilitation measures are announced for application 
the Shanghai FTZ, including simplification of Cu stoms procedures". On page 53 it is noted that 
there is the setting up of a FTZ Administrative Committee which has the responsibility of the 
administrative work in several areas incl. intellectual property (IP) rights.  
 EU Question 9 
How will IP border measures be implemented in  the FTZ in the context of customs procedures 
simplifications?   Answer 
The Chinese Customs pays great attention to IPR enforcement. Relevant regulations are being studied and drafted.  
6. EU Follow-up question to initial EU Question 9 
The EU notes that China is preparing regulations on the implementation of Intellectual property 
right enforcement. The EU would appreciate the following clarifications in this regard:  
 
- Do the Chinese authorities intend to draft regula tions on Intellectual property rights enforcement 
for goods entering, being manufactured and exiting the FTZ in order to complement the existing standard IPR Customs legislation? If so, which entity is in charge?  
- And, is this drafting exercise carried out in consultation with the other intellectual property 
enforcement authorities in China? Are there any ot her stakeholders consulted and if so can China 
indicate the types of stakeholders consulted and where the draft legislation might be available?  
- Can China give an indication of the timeframe by when such legislation would be adopted and 
enforced?   
Joint answer 
The 14th Session of the 14th Standing Committee of the Shanghai Municipal People's Congress 
passed the Regulations on China (Shanghai) Free Trade Pilot Zone which will come into force on 1 August. Article 51 of the Regulations involves In tellectual Property Rights Protection in the Free 
Trade Zone -strengthening intellectual property rights protection in the free trade zone and 
improving connection between administrative protection and judicial protection. The competent authorities of Shanghai should strengthen their cooperation with competent authorities for 
coordinated management and enforcement cooperation in entry and exit protection and domestic 
protection of intellectual property rights and to explore the uniform administrative and enforcement system and mechanism on intellectual property rights in the free trade zone. This 
provision has established the framework for the work  related to intellectual property rights in the 
free trade zone and pointed the way of reform in administration and law enforcement system for intellectual property rights in the free trade zone. The related work is being steadily carried out. 
Currently, the enterprises in the free trade zone are subject to the same laws and regulations of 
China on intellectual property rights as those out of the zone. 
 WT/TPR/M/300/Add.1 
 
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 Page 52, paragraph 2.84  
 The CSPFTZ establishes a Negative List on Invest ment Access. The current list is quite long, and 
will be adjusted when deemed appropriate.  
 EU initial Question 10 
Could China indicate a timetable for revising and shortening the List? Could China elaborate of the 
process of revising the List, and what criteria and considerations will be taken into account? Will third countries and foreign industry be consulted in the process?   
Answer 
Currently, Shanghai is revising the Special Administrative Measures (Negative List) on Foreign 
Investment Access to the China (Shanghai) Pilot Free Trade Zone (2013), following the principles 
of enhanced openness and transparency and compli ance with the international norms. During the 
revision process, opinions from foreign chambe rs of commerce and enterprises were solicited, 
including EU Chamber of Commerce. 
 
7. EU Follow-up question to initial EU Question 10 - Can China provide an indicative time frame for the revision of the Special Administrative Measures (negative list) on foreign investment access to the Shanghai Pilot Free Trade Zone?  
 
Answer 
The amended Negative List for 2014 version was promulgated on 30 June, 2014. The Negative List 
will be adjusted from time to time in accordance with China's laws and regulations on foreign 
investment and the development demands of the pilot zone.  
- Can China explain how it conducts the process of revision of the negative list?  
 Answer 
China will determine the overall framework and princi ples on amending the Negative List based on 
the opinions and suggestions collected from all walk s of life; the competent authorities of Shanghai 
will raise detailed amendment suggestions and solicit opinions from foreign commerce chambers and associations and foreign invested enterprises as well as competent ministries of China; and 
Shanghai municipal government will be responsibl e for promulgating the amended Negative List. 
 - Are there any benchmarks or objectives to be achieved in terms of reducing the number of 
restricted sectors?  
 Answer 
The CSPFTZ will gradually decrease the number of the sectors subject to restrictions on foreign 
investment according to the principles of further opening-up, increasing transparency and 
conforming to international practice.  
Sanitary and Phytosanitary  
 Page 65 paragraph 3.29  
 
The WTO Secretariat reports that "in 2013, there were some 30 temporary prohibitions in place on sanitary grounds, which affected mainly animal products imported from the European countries." 201330 
 
EU initial Question 12 Could China please explain what is the rational for applying non ad-valorem  tariffs when the bound 
duties are ad-valorem ? How does China ensure that the bound duty is not exceeded?  
 Answer 
The specific rates VATs for each year since WTO accession is strictly converted from ad valorem 
rate in accordance with China's WTO commitment. The specific rates are re-calculated each year to ensure that the actual rates levied don't exce ed the committed ad valorem rate. The basis of 
conversion is the average import price of the rece nt years (past 4 years) provided by the Customs, WT/TPR/M/300/Add.1 
 
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 however, for certain tariff lines, data deficiencies such as the lack of import record or significant 
fluctuation in the import price are corrected for the calculation.  
8. EU Follow-up question to initial EU Question 12 
China explained the conversion methodology but didn't explain the reason behind using non ad-
valorem  tariffs when the bound duties are ad-valorem . The EU would be very interested to 
understand the rationale behind China's choice not to use ad valorem  tariffs.  
 Answer 
Products under the same tariff may have various types, sizes and prices. To facilitate customs 
clearance, China imposes specific tariffs on certain products, such as film products which may be 
exposed and are not suitable for in spection by opening the package. 
 
Page 75, par. 3.75 
 Initial EU Question 15 
Will China allow independent commercial testing houses to engage in testing under CCC, and 
foreign testing institutes to cond uct initial factory inspections fo r CCC abroad? Does China consider 
a change in the present conditions and elimination of restrictions in particular in order to allow airplanes at Civil Aviation Administration of China and mining equipment to be used on Chinese 
market? 
 Answer 
China has altogether designated 13 certification agencies and 152 inspection labs. These designated agencies are independent third-party certification organizations. Foreign institutions may carry out CCC initial factor inspection in China according to the cooperation agreement 
between governments or government bodies and based on the commission contracts signed with 
Chinese certification agencies.  9. EU Follow-up question to initial EU Question 15 
According to CNCA's Announcement No. 17 of 6 June 2014, interested testing laboratories and 
certification bodies were invited to formally apply by 20 June 2014 to become designated by CNCA to perform conformity assessment tasks related to the CCC. 
 
-Could China please confirm that the call for applications was also equally open to entities located outside China and foreign-invested ones based in China? Does it apply to any sector covered by 
the CCC or specific sectors only? What are the elig ibility criteria according to the Announcement? 
Will all eligible applicants be designated or is there any limit regarding the number of new 
designations? Will the designated foreign or foreign-invested bodies be able to perform all relevant activities, including initial testing and factory inspection? Could China please provide an update on 
the timeline for a final decision on the applications received? 
 Answer 
In June, 2014, CNCA promulgated the latest announcement concerning relevant demands on 
designating additional certification institutions and laboratories undertaking tasks related to compulsory product certification ([2004] No. 17). Such designation demands apply to all the 
qualified foreign-invested institutions and joint venture institutions in China, but are not applicable 
to foreign institutions in China.  The relevant demands on additional authorizatio n are determined based on the actual needs in 
compulsory product certification and the principles of reasonable utilization of resources, fair 
competition and convenience and high efficiency an d the specific requirements for sectors, areas, 
quantity and qualification conditions have been identified in the announcement. For qualified 
applicants, CNCA will, in strict accordance with laws, regulations and procedures, organize experts 
to appraise and recommend work based on the principle of giving priority to capability and rendering convenience to enterprises and make de cisions based on the appraisal conclusions. All 
the institutions so authorized shall carry out cert ification, inspection and test within the scope 
announced by CNCA.  WT/TPR/M/300/Add.1 
 
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 The additional authorization will be completed at the beginning of August 2014. At that time, CNCA 
will update and publish the latest list of authorized CCC certification institutions and laboratories and their business scope. 
 
- China has not replied to the part of the EU initial question 15 that read " Does China consider a change in the present conditions and elimination of restrictions in particular in order to allow 
airplanes at Civil Aviation Administration of China and mining equipment to be used on Chinese 
market?" Could China provide a reply?   EU initial Question 17 
Could the Chinese authorities provide an overview of the procedures that are applied to decide 
upon temporary prohibitions, and inform how China ensures that it minimises negative trade effects? How does China ensure these measures do not discriminate between national and foreign, 
or between various foreign sources of supply?  
 Answer 
The SPS agreement allows members to take preventive measures in emergency situation even if they have no sufficient scientific proof to justify their measures. China will accordingly take interim prohibition measures in case sudden disease breaks out in foreign countries, major disease is intercepted at port, unknown diseased is identified and is suspected of major impact and multiple 
inconsistencies happens with significant negative implication. These emergency measures are only 
temporary. After that China will conduct risk anal ysis as soon as possible to identify whether 
further measure is needed, the time limit of measures or remove the measures, so as to reduce 
the impact on trade to the minimum.  
When countries encounter diseases that must be notified according to OIE catalogue and Catalogue for Entry Animals and Plants Quarantine of China, or breakout of emerging animal 
diseases, AQSIQ and MOA will follow the Law on the Entry and Exit Animal and Plant Quarantine 
and its implementation rules, OIE code and WTO/SPS agreement to launch prohibition release procedure to issue prohibition. As a Member of WTO, OIE, IPCC, China actively follow international norms and never differentiate 
domestic and foreign enterprise and different sour ce of supply by foreign countries. Based on the 
above measures, China will notify WTO and fulfil its transparency obligation.   
10. EU Follow-up question to initial EU Question 17 
The EU does question China's statement that all measures are in compliance with WTO obligations. For example, the EU would like to stress that there is a so called "temporary prohibition" which has 
been maintained by China, now for more than 10 years on the imports into China of bovine and 
bovine products from several EU Member States due to Bovine Spongiform Encephalopathy (BSE). This measures deviates from the relevant OIE international standard, which clearly states that: "When authorizing import or transit of a number of commodities, such as deboned skeletal muscle 
meat following certain conditions, and any products made from these commodities and containing 
no other tissues from cattle, Veterinary Authorities should not require any BSE related conditions, regardless of the BSE risk status of the cattle population of the exporting country, zone or 
compartment". To date, the EU has not received from China its risk assessment based on science 
for maintaining such trade bans in place. Moreover, the EU has not received the standard processing period of the procedure that China follows to lift the ban, neither an explanation, for 
any of the pending applications, of the stage of the procedure, with any delay being explained.  
 - Could China explain why it maintains still trade bans in place on certain WTO Member countries for reasons of BSE despite the existing of a clear international standard?  
- Could China provide its risk assessment based on science for deviating from the international 
standard on BSE hereby justifying the current ban kept in place? - China provide its standard processing period for applications to have access to the Chinese 
market for bovine and bovine products and for lifting the ban, when such a ban is in place?  
- Is China prepared to provide, to all countries who have applications pending, upon request detailed information on the stage of the pr ocedure with any delay being explained?  
- Could China explain on how it ensures, at all times, that its BSE related import conditions are 
applied in a non-discriminatory manner between countries where identical or similar conditions prevail?   WT/TPR/M/300/Add.1 
 
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 Answer  
China strictly complies with the provisions of WTO/SPS on non-discrimination. Before BSE broke 
out in EU countries and regions, the trade in live cattle and beef between China and relevant 
countries had been always smooth. It was fully based on the concern of safety and scientific 
estimation that China prohibited the import of catt le and relevant products from relevant countries 
after the outbreak of BSE.  
 
Different from western people, the Chinese people are accustomed to cook and eat beef offal which may have residues of high risk and will ca use significant threat to the people's physical 
health. In addition, China is a large developing husbandry country and must attach great 
importance to animal plagues, especially such diseases that have not occurred in China as BSE. 
China has been always respecting science. Accordin g to the principle of risk assessment, we have 
been formulating and adjusting the BSE-related sa nitation and safety measures on cattle and its 
products. The standards and rules formulated by the World Organization for Animal Health (OIE) 
are the main basis for the countries to conduct in ternational trade in animals and animal products; 
provided that all the countries have made adjustment thereto based on their own conditions. For 
example, with respect to cooked poultry, OIE only stipulates that relevant products shall be 
processed as per applicable requirements and the trade shall not be affected by the bird flu and Newcastle disease broke out in the country of origin , however, EU only approved the export of the 
cooked poultry from China's Jiaodong peninsula to EU. 
China noted that many EU Members have been reco gnized by OIE as the countries with controlled 
risks or negligible risks with respect to BSE. Ch ina has provided the risk assessment questionnaire 
to the countries which have applied for elimination of prohibitions, conducted in-depth 
communication and discussion with such EU memb ers as Holland and Ireland regarding the BSE-
related prevention and control system and control status, and lifted the bans on the boneless beef from cattle under 12 months from Holland on 30 June 2014. China will continue to conduct BSE-
related risk assessment and promote relevant technical negotiations with other countries.  
 EU initial Question 18 How does China ensure that its sanitary measures affecting imports from third countries conform 
to the SPS Agreement which contains an obligation to adapt to regional conditions, including 
recognition of the concept of pest- or disease-free areas and areas of low pest or disease prevalence (Article 6)? In relation to the current animal health situation in the EU, why does China 
not follow this international obligation for example regarding African Swine Fever?  
 Answer 
WTO Members have the right to take restrictiv e import measures according WTO rules. China 
strictly follows WTO/SPS agreement on zoning rules and OIE standards on animal diseases zoning and acknowledges the definition of non-disease area and low prevalence area of diseases and pests. After zoning evaluation and field stud y of related countries, China adopts zoning 
management for entry animal quarantine for those complying with OIE standards and Chinese 
laws and regulations.  Regarding ASF, EU as a free trade zone doesn't take risk control measures against animal 
migration among members. After ASF broke out in  Poland, there was no strict zoning and bio-
security isolation zoning adopted. The ASF risk wasn't under control and the whole area was subject to disease risk (3 consecutive incidents in volving 6 cases of wild pig being infected with 
ASF in 2014). In spite of this, China only took me asures against Poland. Relevant countries, after 
eliminating ASF, may submit and provide detailed documents to China. We will organize experts to 
start procedure of removing prohibitive measures.  
11. EU Follow-up question to initial EU Question 18 
Regarding the recent African swine fever (ASF) detection in the EU, the EU would like to clarify that it took all the necessary measures required to control the disease, prevent its spreading and 
allow trade outside of the restrictive zone in a very safe manner both within and outside the EU. 
The EU informed China of all the measures taken immediately after the detection of the few animals infected. Those measures were communicated to China in a very detailed and transparent 
manner; therefore the EU cannot accept the reply that China has given to the questions asked. 
Stringent measures adopted by the EU have been proven very effective. The zoning measures are part of the high level of animal and public health monitoring/surveillance and control measures framework which is in operation in the whole EU. In addition, the EU stresses that in the WT/TPR/M/300/Add.1 
 
- 418 - 
 
  
 framework of Poland's request to import pork into China (as part of the China's import application 
procedure), that China has received already deta iled information on how zoning measures would 
be applied in case of outbreaks, such as ASF. China has studied this very detailed information 
supplied by Poland in which Poland explained how the EU SPS framework is applied on its territory, 
including the framework of zoning measures. Moreov er, Chinese experts did audits on the spot in 
the EU where ample information was supplied both in Poland and in other EU Member States. It is 
on that basis that China has allowed the access of EU pork to its market. Despite having received 
all information on the African swine fever detection and on the stringent zoning measures put in place, China does not recognize the disease free areas and has put in place a country-wide ban on Poland which is considered not proportionate to the risk and more trade restrictive than required.  
- In light of the above, could China explain on which ground it is prohibiting all pork imports from 
Poland?  - Could China explain on how it ensures that the measures it adopts (such as country-wide bans 
were stringent zoning measures are applied in line with international standards) are in conformity 
with the international standard of OIE?  - How do Chinese authorities ensure that the measures adopted are proportionate to the risk, not 
more trade-restrictive than required and not maintained longer than necessary?  
- Could China explain its standard processing period for recognising the concept of disease free areas and thus also zoning measures?  - China explain the processing pe riod for lifting the country-wide ban imposed on Poland for pork, 
which is now in place for already 5 months?  
- With a view to minimise negative trade effects, could China ensure that the concept of zoning is recognized, immediately whenever an outbreak occurs from a well-known disease such as ASF, 
based on the very detailed information provided and audits carried out in the country of origin as 
part of China's initial application procedure for imports into China?   
Answer 
China prohibits import of pigs and its products fr om Poland upon the outbreak of ASF in Poland 
based on the consideration of safety and science. First of all, ASF is a kind of animal plague 
catching great attention both in China and around the world, which is determined by its biological 
characteristics. ASF has strong environmental adaptability and is one of the infectious diseases 
having greatest damage to pigs. China is a large pig breeding country whose pig breeding quantity accounts for more than a half in the world. If ASF is brought into China, China's pig breeding 
sector will be significantly affected. Secondly , China has the right to adopt the prohibition 
measures in accordance with its applicable laws and regulations. In accordance with the Law of people's Republic of China on the Entry and Ex it Animal and Plant Quarantine and the Animal 
Epidemic Prevention Law of the People's Repub lic of China, the Ministry and AQSIQ jointly 
promulgated the List of Quarantine Diseases for th e Animals Imported to the People's Republic of 
China (No. 2013), prohibiting the import of relevant animal and animal products from the countries having such animal plagues as ASF. This provision applies to all the countries, rather 
than applying only to Poland. Thirdly, the effects of the measures adopted by Poland currently are 
subject to further evaluation. For example, Pola nd designates threat zone and cushion zone 
around the epidemic focus and conduct investigations and monitoring on animal sanitation within 
the cushion zone 10km from the epidemic focus. However, we understand that wild boar may rush 
for more than 10km without stop and the incubation period of ASF persists for 20 days. We shall further discuss and appraise on whether the monitoring scope, sampling allocation and area to 
capture wold boar  adopted by Poland now may completely control the risks of dissemination. 
 Standardization and testing Page 73 Para 3.65 notes that standards in Chin a continue to be developed mainly under the 
Standardization Law (of 1988) and the Regulations for the Implementation of the Standardisation 
Law (1990).   
EU initial Question 13 
Could China expand on the plan to modernise and simplify its standardization system, in 
particularly by the means of an update of the current Standardization Law (of 1988)?  
 
Answer 
The Standardization Administration is working to  simplify and modernize the standard system, and 
is actively involved in revi sing the Standardization Law. WT/TPR/M/300/Add.1 
 
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 12. EU Follow-up question to initial EU Question 13 
The EU understands that the Standardization Administration is working to simplify and modernise the standards system  
 
- The EU would like to restate its question and ask China to elaborate as to the precise contents of this plan, or at least on its general orientations at this stage. 
 
Answer 
For the purpose of promoting the establishmen t of a uniform market, China is proactively 
promoting the integration and optimization of compulsory national, industrial and local standards 
and trying to decrease the number of such standards. 
The general principal is as follows: compulsory standards involve human health, human and property safety and environment protection, which shall be controlled and well controlled by the 
government. China will gradually integrate compulsory national, industrial and local standards into 
new compulsory national standards and raise the level of the promulgation authorities. Such 
standards will be promulgated by the State Counc il or as approved and authorized by the State 
Council. 
 Page 76 section 3.1.9 cosmetic products  
In China, new cosmetic ingredients to be used fo r cosmetic production must be approved by the 
Chinese Food and Drug Administration authorities (CFDA).   
EU initial Question 19 
Could China confirm that cosmetic ingredients not included in the Inventory of Cosmetic Ingredients IECIC2014, such as phenoxyethanol, CAS No. 122-99-6, benzoic acid, CAS No. 65-85-
0 and collagen, CAS No. 9007-34-5, are nonetheless allowed as ingredients for cosmetic products?  
 Answer 
First, Inventory of Cosmetic Ingredients is an objective list of all ingredients used in cosmetics 
production and sale in China. EU could refer to this catalogue for information; second, with the 
improved understanding of ingredient safety, an d new evaluation method, the regulators will 
conduct dynamic management of the catalogue, so as to ensure that the reference used for 
judging new raw material in cosmetics is sound, practical and scientific. The materials not included 
in the catalogue have to be examined through new material review process according to regulations before use.  
 
13. EU Follow-up question to initial EU Question 19  The Chinese authorities request Free Sale Certificates (FSC). And those products are "clearly sold in the country of origin". However, the EU would like to stress that there are obviously some 
products that are sold on the Chinese market and not elsewhere because they are targeted to suit 
Chinese consumers' tastes and preferences, this is normal business practice to adjust to the 
market in order to suit the consumers' specific preferences. However those products destined for 
the Asian markets, can be sold but their marketing is not authorized.  
 - How do the Chinese authorities justify such measures and are there any remedies to improve the 
situation that are under consideration?  
 Answer 
We are in the process of coordinating competent authorities for reply. 
 
EU initial Question 22 on page 77 paragraph 3.79 With regard to the recent adoption of 'Detailed Regulations for the Administration of Bad Records 
of Imported Foods by the China Food and Drug Admi nistration (CFDA), the EU would be grateful if 
China could explain how, in the event of a produc t being black listed either by mistake or because 
of a minor infraction, the authorities will ensure that adequate processes are in place to remove 
such a product from the black list, including through consultation with the necessary stakeholders?  
 WT/TPR/M/300/Add.1 
 
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 Answer 
The Detailed Regulations for the Administration of Bad Records of Imported Food is released on 
14 April 2014.  
The details can be viewed at: 
http://www.aqsiq.gov.cn/xxgk_13386/jlgg_12 538/zjgg/2014/ 201404/t20140414_ 409200.htm. 
According to article 4 (removal of risk pre-warning) of the regulation, foreign food import 
enterprises with bad record may apply for removal of risk pre-warning at food security authority in 
local country/region when they meet the condition for removal (Attachment 1). The local country/regional food security authority will cond uct investigation based on the application and 
report the rectification measures and investigation result to AQSIQ. If AQSIQ identifies that there 
is no risk or the risk is reduced to acceptable level after risk assessment, it shall timely lift the risk 
pre-warning and control measures.  Meanwhile, if a country/region in the record meets the condition for lifting risk pre-warning 
(Attachment 2), its food security authority shall report the investigation of the cause of risk and 
regulatory improvement to AQSIQ, If AQSIQ identifies that there is no risk or the risk is reduced to 
acceptable level after risk assessment, it shall timely lift the risk pre-warning and control 
measures. 
 14. EU Follow-up questions to initial EU Question 22  The EU has concerns about the damage to the reputation of a company (or indeed a country or 
region) which might find itself black listed either because a counterfeit version of its brand has 
been tested and found to be substandard/pote ntially harmful (while the genuine version is 
perfectly safe) or because of minor infringements of packaging or labelling regulations (with no 
implications for consumer safety and which can easily be rectified). There does not seem to be any 
mechanism for the quick removal of a product from the black list even if its inclusion has been a mistake. 
 
- Could China give assurances that, in the event of a product being black listed either by mistake 
or because of a problem of packaging or because of  any other minor issues, proportionality will be 
applied?  
- Could Chinese authorities commit to, in any case, consult stakeholders and inform governments 
(diplomatic missions in China for example)?  - Could China commit to put in place an adequate and quick process to guarantee without delay 
the removal of a product from the black list in case it was black listed either because of a mistake 
or a problem of packaging including through consultation with the necessary stakeholders and competent authorities of the exporting country?  
 
Answer 
We are in the process of coordinating competent authorities for reply.  
Page 78 Para 3.83 
EU initial Question 23 Could China explain how and when is the risk analysis carried out by China made available to 
trading partners in the event of a prohibition on imports of animals or plants being put in place? 
Could China explain which standard processing period is used to follow-up on an application to lift 
the prohibition once the epidemic has been brought under control?  
 
Answer 
After implementing import prohibition on animal  and plant and associated products, China will 
follow SPS agreement to timely notify other SPS national contact points of the products under 
prohibitive measures, the scope involved and the re ason for prohibition, and will provide technical 
document at the request of trade partners. If related countries or regions have contained the diseases and submit requests for lifting import pr ohibition, China will follow international standards 
and procedures to organize experts to conduct risk analysis through questionnaire evaluation and 
filed study. Upon request of its trade partners, Ch ina can provide risk analysis report according to 
the time and approach reached in the bilateral ne gotiations. The progress of risk analysis depends 
on the cooperation and adequacy of techni cal documents provided by trade partners. 
The standard procedure of removing prohibitive measures is generally as follows: related countries or regions contain the diseases and raise request for removing import prohibition; China organizes experts to conduct questionnaire evaluation and demand for additional documents based on the WT/TPR/M/300/Add.1 
 
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 evaluation; if the documents could prove that the risk is under control, China will prepare expert 
mission to conduct onsite evaluation; complete risk analysis report; the prohibition will be removed by AQSIQ together with MOA for those meeting China's health requirement. The format 
will be joint statement by AQSIQ and MOA. 
 15. EU Follow-up questions to initial EU Question 23 related also to paragraph 3.84 
The EU understands the necessity for government authorities to make sure that any spirits 
imported into the country should be free from contamination with phthalates, after higher-than-expected levels had been found in Chinese domestic spirit drink products, hence the decision to impose the requirement for test reports/certification from approved laboratories in the countries of 
origin as to the levels of certain phthalate residues in all brands that was taken in February 2013. 
The EU does not understand why the measure was not notified to the SPS Committee. The EU is informed that the health authorities have now completed their risk assessment and consequently, 
the current trade restrictive measures should be reviewed without delay with a view to minimise 
the negative trade effects. Regarding wine, more particularly, China requires the control of iron, manganese and dry extracts at imports. There ar e no international standards for these criteria. 
China has not provided its justification based on science for maintaining these measures which do 
create a barrier to trade.   - Now that the risk assessment on phthalates in spirits has been finalised by China, could China 
explain, in detail, how and when it will review its current import conditions with regard to 
phthalates to ensure that these are proportionate to the risk, non-discriminatory to domestic products and to ensure that these are not more trade-restrictive than required?  
- Could China explain when it will launch a WTO SPS notification on new import conditions with 
regard to phthalates, based on the recent risk assessment?  - Could China explain its justification to continue imposing the requirement for laboratory 
certification on imported spirits, now that the risk assessment has been finalized?  
- In order to facilitate trade and to ensure that the import conditions are proportionate to the risk, in order also to ensure that the measure is limited to what is reasonable and necessary, could China explain when and which immediate actions it will take to no longer require laboratory 
certification for imported spirits in respect of phthalates and thus to lift this trade barrier?  
 Answer 
Currently, China has completed the risk assessment on plasticizers in white spirits and has required relevant authorities to determine the level of plasticizers in the imported white spirits based on the results of the risk assessment. China will adjust the requirements on plasticizers in 
other imported alcohols based on the results of the risk assessment on the level of plasticizers in 
other alcohol products (except white spirits).  16. EU additional Follow-up questions on wines 
- Regarding wines, could China explain its rati onal to keep these measures regarding iron, 
manganese and dry extracts in place and provide its risk assessment based on science?   
- Could China explain when and how it will review its import conditions with a view to minimize 
negative trade effects?   
Answer 
The Standards for the Usage of Food Additives (GB2760-2011) - China's national standards on 
food safety, stipulate the maximum quantity of mineral chameleon in alcohols (residues in the 
alcohol (Mn) ≤2mg/kg). The national standards Wines (GB15037-2006), stipulate the limits on iron 
and dry extracts. China will inspect and test the imported wines based on relevant standards. 
 WT/TPR/M/300/Add.1 
 
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 Intellectual property rights 
 Page 112, Paragraph 3.206 on patents 
 
Initial EU Question 37 Could China comment on how will SIPO's commitment to adapt its interpretation of Patent 
examination Rules on "inventive threshold" and "s ufficiency of data" be implemented so as to 
achieve improved streamlining with other major World IP Offices' practice and interpretation of similar rules? Will China introduce "supplementary protection certificates" (patent restoration of term due to regulatory delays) for pharmaceutic al and plant protection products patents? Will 
China introduce "data/market" exclusivity for pharmaceutical dossiers?  
 Answer 
We are in the process of coordinating domestic agencies involved to 14 generate proper details on this issue.  
17. EU Follow-up question to initial EU Question 37 
Does the EU understand correctly that these patent law questions are not decided at a central level (SIPO/SCLAO), but in coordination with domestic agencies?   
Answer 
Currently, the examination standards adopted by SIPO  on "inventive threshold" and "sufficiency of 
data" have not changed. Under the Guidelines for Patent Examination, applicants are permitted to 
submit additional data after submitting the patent application. In order to correctly implement 
applicable laws and regulations, SIPO promotes examination personnel to correctly understand and apply laws through strengthening business guidance. 
 
For the time being, China has not considered introd ucing "supplementary protection certificates" to 
pharmaceutical patents. And in China, new varieties of plants are protected through the specific Regulations on Protection of New Varieties of Plants rather than patents. 
 
Page 112, Paragraph 3.20, Requirements for applications for foreign patents  
Initial EU Question 39 
How does China plan to match the need for national-interest clearance with the requirements of the international IP system? Are there plans to mo re closely define the definitions of substantial 
content in order to provide more clarity for users and applicants?  
 Answer 
We are in the process of coordinating domestic agencies involved to generate proper details on 
this issue. 
 18. EU Follow-up question to initial EU Question 39 
Does the EU understand correctly that the requirements for applications for foreign patents are not 
legally analysed and decided at a central level (SIPO/SCLAO), but in coordination with domestic agencies?  
 
Answer 
Inventions or utility models completed in China are subject to secrecy examination by SIPO before any application for patent for the same with fore ign countries so that SIPO may determine whether 
they involve issues related to state security or public interests and must be kept confidential. 
China adopts similar practice to other countries in this respect. Such main states as the U.S., Germany and the UK have stipulated corresponding rules on secrecy examination in their patent 
laws. 
Substantial content is not further defined for the time being, which is to be determined mainly based on the claims in the patent application. 
 
Page 118 Paragraph 3.245 states : "All public security authoritie s above the prefecture and city 
levels in China have established IPR crime coordinating activities and lead organizations to arrange and coordinate actions to crack down on infringement and counterfeiting activities"  WT/TPR/M/300/Add.1 
 
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 EU initial Question 41 
Could China indicate the legal framework of the described coordination activities? Are the conditions and measures of such concerted actions clearly stipulated? Does China intend to 
implement further measures to harmonize and coordinate the approach taken by (regional) 
Prosecutors and Courts in IP and enforcement matters?   
Answer 
We are in the process of coordinating domestic agencies involved to generate proper details on 
this issue.  
19. EU Follow-up question to initial EU Question 41 
Could China: - a) indicate the legal framework, and  
- b) provide more details on the IPR crime coordinating activities and lead organizations, which 
public security authorities already "have established", according to paragraph 3.245 ?   
Answer 
In November 20110, China Public Security Agen cies implemented a campaign named "Counter-
Strike Sword Action" to crack down the infringement on IPR nationwide. The "Counter-strike Sword Action" working groups of public security organs at local level are responsible for cooperation with 
the relevant division of public security organs to crack down the IPR infringement and have 
achieved remarkable progress. After the "Counter-S trike Sword Action", to enhance the leadership 
in the combat the crime of IPR infringement on a regular basis, the Ministry of Public Security 
issued the Working Opinion in May 2012, to conver t the above-mentioned working groups at local 
level into the leadership group responsible for cracking down the crime of IPR infringement to coordinate and organizing various divisions of public security organs to implement the campaign of 
combating the IPR infringement. 
 Agriculture  
Page 128 Paragraph 4.17  states that "Agricultural exports subject to state trading are cotton, 
rice, maize, wheat and tobacco." At the same time, according to Table 3.17 (Export products subject to state-trading arrangements, 2011-13) wheat is not subject to state trading.  
 
Initial EU Question 44 Could China clarify which agricultural products exports are subject to state trading (import and 
export/price setting)? The EU is also interest ed in the export values, volumes and the main 
destinations of products subject to export under STEs.  Answer 
For relevant information on exports of state trading enterprises, please consult the answers to the questionnaires on export competition submitted by the Chinese government to WTO Agricultural 
Committee.  
 
20. EU Follow-up to initial EU Question 44 The EU notes that China referred in its answer to its notification fo the WTO (document 
G/AG/W/125/Add.4). However, there seems to be a discrepancy on the products subject to state 
trading as outlined in the TPR.   Answer 
According to the Protocol on China's Access to WTO,  importing wheat is subject to state trading in 
China.  
Page 129 internal measures and support measures  
 Table 4.5 of the Secretariat paper lists various agricultural subsidy programmes 
 WT/TPR/M/300/Add.1 
 
- 424 - 
 
  
 EU initial Question 47 
The EU would be interested to know how much is the total budgetary outlay devoted to agricultural 
domestic support as well as a breakdown of this  spending per program during the period under 
review.  
Answer 
China's budget for agriculture support is calculated differently from that of WTO agriculture 
agreement. Thus no budget expenditure can be submitted. For data on China's support for 
domestic agriculture, please refer to the notification submitted by the Chinese government to WTO on agriculture domestic support.   
21. EU Follow-up question to initial EU Question 47  
China states that for "data on China's support for domestic agriculture, please refer to the notification submitted by the Chinese government to WTO on agriculture domestic support".  
 
- Taking into account that the last DS notification dates back to 2008, could China inform the EU hen a new DS notification is to be expected? If no notification is to be expected soon, could China 
provide figures on subsidies based on the method used for the Chinese budget?  
 Answer 
Relevant Chinese authorities are proactively preparing the notification on domestic agricultural 
subsidies since 2009. Once relevant domestic pr ocedures are completed, China will submit the 
notification to the Agricultural Committee. As China has a vast agricultural land and large population and each household operates agricultural business independently and the accounts of 
domestic fiscal budget expenditure are different from those adopted in the classification of WTO on 
domestic agricultural subsidies, it will take a long time to collect data, prepare statistics and tables. 
 
Paragraph 4.25 For the comprehensive subsidy on agricultural inputs (which compensates for the increase of the price of inputs such as fertilizers and diesel fu el) the specifics of the subsidy are formulated by 
provincial governments.  
 EU initial Question 48  
Could China clarify what do these specifics cover? Considering that the price of inputs in general is 
uniform over a country's territory, could China comment on why is there a need to adapt the specifics to local conditions?  
 
Answer 
Subsidies are provided to compensate for the increa se of the price of inputs such as fertilizers and 
diesel fuel. As China is vast and its various regions differ from each other in the causes of the 
increase in prices, the central government grants lump-sum subsidies to different regions and the 
local government decides the criteria for granting subsidies in light of local conditions.   
22. EU Follow-up question to initial EU Question 48 
Could China give examples for criteria used for gr anting fuel and fertilizer subsidies "in light of 
local conditions"?  
 
Answer 
The current general subsidies for purchasing agricultural supplies include fuel and chemical fertilizer subsidies granted to villages. The specific subsidy standards and subsidy granting 
measures are to be determined by the provincial people's government based on the local 
conditions of the province. The standards and measur es in some regions are as follows: in Beijing, 
the standards and measures may refer to the Im plementation Opinions on 2014 Beijing Municipal 
Policies on Direct Grain Subsidies and General Subsidies for Purchasing Agricultural Supplies 
promulgated by Beijing Municipal Commission of Rural Affairs  (http://www.bjnw.gov.cn/zfxxgk/fgwj/z cxwj/201405/t20140 513_334435.html). 
 
Paragraph 4.26 "The New Variety Extension Payment scheme' has been changed in 2009 and it now varies according to the commodity and may involve a numb er of types of transfers to the farmers."  WT/TPR/M/300/Add.1 
 
- 425 - 
 
  
 EU initial Question 49 
Could China expand on the rationale in giving the subsidy in different forms depending on the commodity? How will this change affect the way this program is notified to the WTO?  
 
Answer 
Subsidies for superior strains and seeds are granted according to the plant area. Subsidies for 
superior strains and seeds of rice, maize and rape seed are granted in cash to farmers directly 
according to their farmland areas; for wheat, soybeans and cotton, provincial governments decide whether to provide direct subsidy to farmers or cu t seed price. The reason for different subsidy for 
different plants is that, rice, maize and rapeseed generally have hybrid superior seeds, which 
farmers can purchase directly in the market, thus the subsidy can be granted directly to them; 
wheat and soybeans have both hybrid superior and normal seeds. In case farmers stop purchasing hybrid superior after getting subsidy, governme nts organize tendering of superior seeds. The 
organization winning the bid will provide seeds to all. Farmers can purchase such seeds at 
preferential price with the subsidy. For next step , we will further improve the approach of granting 
superior seed subsidy. 
 
The change of methods of delivering subsidy doesn't affect the notification to WTO. Superior seeds 
subsidy is granted according to plant area and is  notified in the amber box for special product 
support. It is implemented within a minimum amount. 
 
23. EU Follow-up question to initial EU Question 49 For the "New Variety Extension Payment" China replies that "the change of methods of delivering 
subsidy does not affect the notification to the WTO. Superior seeds subsidy is granted according to 
plant area and is notified in the amber box for special product support   
- Could China identify the exact amounts figuring in its relevant DS notifications which correspond 
to superior seeds subsidies granted according to plant area and notified in the amber box as special product support?   
Answer 
For details of the exact amounts, please refer to the domestic subsidies notification submitted by 
China to WTO. 
 
Page 105 para 3.175 Public Procurement EU initial Question 51 
In view of the ongoing negotiations for China's accession to the GPA, what are the concrete steps 
which China envisages to take for the alignment of its procurement legislation with the GPA rules and by which timeline? In particular, when does  China envisage eliminating the preference for 
domestic goods, construction projects and services from its Government procurement legislation?  
 
Answer 
China's legislative organs will consider adjusting laws and regulations based on the negotiation. 
 
24. EU Follow-up question to initial EU Question 51 - Can China provide a timeframe and a roadmap for the process leading to alignment with GPA 
rules?  
 Answer 
There is no timeframe and roadmap currently. 
 
- Does China agree to undertake their legislat ive reform in parallel with market access 
negotiations? 
 
Answer 
China will commence negotiations based on the procedures of accessing to GPA. 
 
EU initial Question 52 Could China specify in which other pieces of legislation (both at national and local level) there is a provision for domestic preference?  WT/TPR/M/300/Add.1 
 
- 426 - 
 
  
 Answer 
The Government shall purchase domestic goods, construction projects and services, this is the 
principle of Government Procurement Law. Th ere are no detailed provisions or mandatory 
regulations. 
 25. EU Follow-up question to initial EU Question 52 
Can China provide the statistical information about number and value of such contracts which has 
been concluded during the recent years?   Answer 
Currently, China has no detailed policies and measures on giving priority to domestic goods, so there is no such data.  
Initial EU Question 53 
Could China provide statistics about the number and value of contracts where the national preference has been applied?  
 
Answer 
China has no government procurement contract with national preference for the time being.  
26. EU Follow-up question to initial EU Question 53 
The EU is of the view that China's reply to its qu estion 53 contradicts China's reply to EU Question 
52. In fact China in its reply to Q53 says that there are no national preferences but does recognize 
in its reply to Q52 that there are "principles" in the Government procurement law that make the 
government buy domestic goods.   
Answer 
Question 52 and Question 53 are not contradicted with each other. The reply to Question 52 refers 
to the relevant provisions in the Government Procurement Law, while the reply to Question 53 refers to that there is no detailed implementation measures. Actually, in terms of government 
procurement, China has always been acting fairly to both domestic enterprises and foreign-
invested enterprises in China. Therefore, ther e is no government procurement contract only 
applicable to domestic suppliers. 
 
- The EU would like to know the statistics ab out the number and values of those government 
procurement contracts that are only subscribed by domestic suppliers.  
 
Answer 
There is neither government procurement contract only applicable to domestic suppliers nor relevant statistical data. 
 
Page 115 Paragraph 3.224 (Geographical indications) The EU is aware of China's three parallel protection  systems for GIs, i.e. the protection of GIs as 
Trademarks, as GI products, and as GIs of primary agricultural products. The three systems work 
separately and have their own mechanisms, but overlap in scope. As a result, the same GIs may be simultaneously protected by two or more legal systems.  
 
EU initial question 40 How does China ensure that in practice conflicts between the different GI protection systems are avoided?  
 
Answer 
There are two types of protection for GI, namely  protection by special law and protection by 
trademark law. MOA uses special law and follows Agriculture Law, Produce Safety Law and 
Management Method on Geographical Indication of Agricultural Product to protect the GIs of agricultural products. Right owners may voluntarily  select either special law or trademark law for 
protection according to different levels of protection and self-protection demand. As long as the 
right owner remains the same, they can register under different systems and get protection from multiple departments.   WT/TPR/M/300/Add.1 
 
- 427 - 
 
  
 27. EU Follow-up question to initial EU Question 40 
- The EU would like to know how, based on this  system, China does ensure that there are no 
conflicts between the systems of protection that ca n be used simultaneously by the right owners.  
 
Answer 
Currently, the key factor ensuring that there are no conflicts between different protection systems 
that can be used simultaneously by the right ow ner is that the right owner is the same body. 
According to TRIPS, the GI and trademark right ar e independent from each other but coe-existing. 
Therefore, in the case of China, the owner of GI may resort to a specific protection system or a 
trademark right protection system at his own discretion. The agency which has registered such 
product is responsible for protecting such goods if infringement occurs.  
While registering GI of agricultural products, the Ministry of Agriculture shall examine the conflicts 
between the product name (the GI name of the agricultural product) and the trademark. Such  
conflict examinations are only limited to the pr ior trademarks registered in Chinese trademark 
system. The Registration Examination Standards on Geographical Indications of Agricultural Products have made it clear that the authority shall examine whether the name of the product 
under the application has conflict with any ordinary  trademark, collective trademark or certification 
trademark previously registered, and, if the name  of the product under the application has been 
registered as an ordinary trademark, the applic ant shall provide the supporting documents proving 
the consent of the owner of the ordinary trademar k on transfer or use. Where the name of the 
product under the application has been registered as a collective trademark or certification 
trademark (GI registered by the industrial and commercial authority), the applicant must be the trademark owner. If the applicant conceals anyt hing or submit fraudulent information, the 
registration certificate may be cancelled or deregistered. 
In accordance with the Trademark Law and its implementation rules, the party may apply for registration of GI as a certification trademark or collective trademark if it intends to obtain the 
exclusive right to use the trademark. 
The national IPR strategy for 2014-202 explicitly proposed that the legislation tailor to GI protection shall be taken into consideration in a proper time.   
WT/TPR/G 300 
 Paragraph 2.28  
 
EU initial question 71 The Chinese trademark office has repeatedly registered marks which were similar to well-known 
trademarks and could therefore mislead the public.  
Has this problem been addressed by the recent changes? Does China envisage reforms to accelerate the implementation of court rulings regarding modification of a company name?   
Answer 
We are in the process of coordinating domestic ag encies involved to generate proper details on 
this issue. 
 
28. EU Follow-up question to initial Question 71 on the Government report - By its answer, does China mean that Chinese authorities intend to provide a more detailed 
answer soon? -Could China provide at least some general policy orientations on the issue?  
 Answer 
With regard to well-known trademarks, Articl e 13 of the 2014 amended Trademark Law provides 
for as follows: where the trademark of an identical or similar kind of goods is a reproduction, 
imitation, or translation of another person's well-known trademark not registered in China and is liable to cause public confusion, no application for its registration may be granted and its use shall 
be prohibited. Where the trademark of a different or dissimilar kind of goods is a reproduction, 
imitation, or translation of another person's we ll-known trademark not registered in China and it 
misleads the public so that the interests of the owner of the registered well-known trademark are 
likely to be impaired, no application for its registration may be granted and its use shall be 
prohibited.  WT/TPR/M/300/Add.1 
 
- 428 - 
 
  
 With respect to the conflicts between trademarks  and enterprise names, Article 58 of the 2014 
amended Trademark Law provides for as follows: Where the registered trademark or unregistered well-known trademark of another person is used as the business name, it misleads the public and 
unfair competition is so constituted, the party will be subject to the Anti-Unfair Competition Law of 
the People's Republic of China. Currently, the Anti-Unfair Competition Law of the People's Republic of China is being amended. 
 
Page 17 Section 3.2  on promoting balanced and sustainable development of trade and 
investment  
EU initial Question 78 
Could China provide more details on its activities and efforts to promote sustainable development?  
 
Answer 
We are in the process of coordinating domestic agencies involved to generate proper details on 
this issue. 
 
29. EU Follow-up question to initial EU Question 78 The Government Report presents sustainable development of trade and investment as a policy objective of the Chinese government, describing it as proactive and as a continued effort.  
 
- The EU would be interested to know more details of this policy, its aims and orientations, as it has apparently been carried out for some time and will continue.  
 
Answer 
Chinese government has been always attaching great importance to environment protection and 
implementing sustainable development strategies. In recent years, China has achieved progress in 
environment protection, mainly including the following five aspects: (I) strengthening pollution prevention and control. China has promulgated the Action Plan on Prevention and Control of Air 
Pollution, mainly focusing on PM2.5 and PM10, and is formulating the Action Plan on Prevention 
and Control of Air Pollution and the Action Plan on  Prevention and Control of Land Pollution. (II) 
M aki ng  s mooth p rog re ss  in e ne rg y s avi ng  and  e m ission reduction. In the past three years, the 
energy consumption per unit of GDP and the carbon  dioxide emission intensity have been reduced 
by 9.03% and 10.68%, respectively, and approximately 350,000,000-ton standard coals have 
been saved, i.e. 840,000,000-ton carbon dioxide emission less; and the national aggregate emission of COD, ammonia nitrogen, carbon diox ide and nitrogen dioxide has been reduced by 
7.8%, 7.1%, 9.9%, 2.0%, respectively; (III) Increa sing importance of environment protection in 
economic development. China has imposed stricter special limitation on air pollutants in coal-fired 
power, iron and steel, petroleum and chemistry,  cement and other relevant sectors. China has 
arranged around 7,000,000 environment enforcement person-times to inspect more than 
2,780,000 entities (times) and discovered more than 25,600 offenses. (IV) Strengthening 
biological protection and environment protection in rural areas. China has implemented the Strategy for China Biodiversity Conservation Stra tegy and Action Plan in depth, increased the 
national forest coverage to 21.6% and established 2,697 natural protection zones. (V) 
Continuously improving biological environment. In the first quarter of 2014, the quarterly intensity of PM2.5 in 13 key cities in Beijing, Tianjin and Hebei regions was reduced by 9.5% compared with 
that in 2013, and the scope, persistence period and pollution intensity of heavy polluted weather 
have been alleviated. The 3
rd Plenary Session of 18th CPC Central Committee raised the requirement on speeding up 
ecological progress. In April 2014, the amended environment protection law was passed, which 
has improved the basic rules on environment protection, strengthened responsibilities of 
governments and enterprises, identified citizens obligations for environment protection and provided a legal channel for the public to partic ipate in environment protection. This will provide 
strong legal guarantee for environment protection and improvement, pollution and other public 
nuisance prevention and control and sustainable economic and social development.  
 WT/TPR/M/300/Add.1 
 
- 429 - 
 
  
 Pages 24, paragraph 3.593.4.4 Enha ncing South-South cooperation 
 The EU notes with interest the information rega rding Aid for Trade (AfT) in the Government of 
China's (GOC's) report. Moreover, inter alia  in the context of the WTO Committee on Trade and 
Development's session on AfT and its work programme for the coming biennium 2014-2015. GOCAfT2014-2015. 
 
EU initial Question 82 The EU would be grateful if the GOC could prov ide additional details on China's Aid for trade 
regime. In particular, information relating to recipient countries, amounts, purpose and duration of 
Aid for trade activities would be very appreciated with a view to get a better understanding of 
China's growing contribution in this area.   
Answer 
China has actively supported Aid for Trade Regime with practical actions since this initiative was 
launched by WTO. First, helping the LDCs to pa rticipate in multi-lateral trading system. Since 
2008, China has made donations to WTO each year for the work of Aid for Trade Regime. Since 
2011, China has set up China Programme by using the donation for helping the LDCs to access to the WTO. Up to now China has successfully held two China Round Tables on WTO Accession for Least Developed Countries. Second, helping the LDCs  to improve their production capacities and 
promote trade development. China provides aid to relevant countries in productive construction 
projects, improve their production capacities, expand trading scale and optimize trading structure. Third, improving market access and expanding exporting of products. It is honoring its 
commitments on giving zero-tariff treatment to relevant LDCs. Fourth, increasing its investment 
and improving infrastructure construction. China will continue to increase its investments in developing countries and LDCs, while aiding to build various large and medium-sized infrastructure 
construction projects, so as to help improve the conditions of transportation and application of 
information technology in the LDCs. In future, China will continue, to the best of our abilities, to provide aide for trade for LDCs.   
30. EU Follow-up question to initial EU Question 82 
In the context of "helping the LDCs to improv e their production capacities and promote trade 
development" and "increasing its investment and improving infrastructure construction", 
- Could the GOC clarify which countries it provides this support to, what the values of such 
projects are and the duration of such projects? Fo r example, the annual EU report on Aid for Trade 
presented by the EU annually at the Committee on Trade and Development sessions on Aid for 
Trade gives this information both in summary an d in detail. The opportunity to undertake such 
donor coordination with China would undoubtedly improve the impacts generated from both the EU's and China's Aid for Trade.   
Answer 
As an active response to the WTOs Aid for Trade initiative, China strengthened its assistance in 
infrastructure construction and production capacity building for other developing countries. China 
also steeped up zero tariff treatment to these countries so as to promote the trade development of 
these countries.   
As for improving trade-related infrastructure, during the period of 2010-2012, China assisted the 
construction of 90 large and medium-sized, trade-related infrastructure projects, effectively improving transportation for foreign trade in the recipient countries and reinforcing their 
connectivity with other areas. China also provid ed commodity inspection equipment, transport 
vehicles and other trade-related supplies and equipment to other developing countries. For 
example, it provided container inspection equipm ent to Cambodia, Lao P.D.R, Myanmar, Ethiopia, 
Egypt, Chad, Cabo Verde, Zambia and Serbia, which has helped these countries improve their 
commodity inspection capacity and customs clearance ability, as well as effectively combat against 
smuggling.   
As for improving trade-related production capacity, China assisted the construction of a number of 
trade-related production programs, which have  helped improved to a certain degree the 
production capacity of the recipient countries, so that they can better meet the needs of the 
market and improve the import-export mix. In December 2011, during the 8th Ministerial WT/TPR/M/300/Add.1 
 
- 430 - 
 
  
 Conference of the WTO, China reached agreement with Benin, Mali, Chad and Burkina Faso the 
Cotton 4 countries on a cooperation program in which China provides cotton seeds, farm machinery and fertilizers, shares planting technologies, provides training, and supports local 
companies for technological upgrading and the expans ion of industrial chain, so as to promote the 
development of the four countries cotton industri es and foreign trade. In December 2013, during 
the 9th Ministerial Conference of the WTO, China and Cotton-4 countries reached the new 
agreement, and China committed to provide further assistance to those countries.  
As for promoting export to China, in an effort to effectively boost expo rt to China from other 
developing countries, in 2005 China decided to offer zero tariff treatment on taxable items in 190 categories to 25 least-developed countries in Africa, and further expanded the scope of the 
treatment in the following years. In November 2011, then Chinese President Hu Jintao announced 
that China would offer zero tariff treatment to 97% of the taxable items from the least-developed countries that had established diplomatic relations with China. By the end of 2012, commodities in 
nearly 5,000 taxable categories exported to China from the least developed countries were 
enjoying zero tariff treatment. Since 1 January 2014, China had granted zero-tariff to 95% of tariff items (according to China's tariff items) from 35 LDCs, which had diplomatic ties with China. In 
March 2013, President XI Jinping announced at the BRICS Leaders-Africa Dialogue Forum that 
China would accomplish its goal by 2015 of granting zero-tariff treatment to 97% of the tariff items of exports to China from the LDCs, which have diplomatic ties with China . WT/TPR/M/300/Add.1 
 
- 431 - 
 
  
 FOLLOW-UP QUESTIONS BY THE UNITED STATES 
SECRETARIATS REPORT 
 
SUMMARY 
 1. In U.S. question 3(a), the United States asked why China has not met its subsidy notification 
obligations. In its response, China points to capacity constraints but notes that Members can 
inform China if they encounter pr ohibited export subsidies. Although the United States believes 
that it is China's obligation to notify its own subsidy programs, if Members do inform China of export subsidies that are prohibited under Article 3 of the SCM Agreement, what actions will China 
take? Is China suggesting that it would agree to terminate those subsidies outside of the dispute 
settlement context?   
Answer 
In 2014, the General Office of the State Council of  China issued the Circular on Further Enhancing 
Trade Policy Compliance. The Circular requires the State Council departments, and governments at 
provincial level to ensure that when the regu lations, regulatory documents and other policy 
measures relative to or with an influence on tr ade in goods, trade in services, and trade-related 
intellectual property rights are formulated, they  should be consistent with the WTO rules and 
China's accession commitments. MOFCOM is working on implementing this Circular. 
 
2. In U.S. question 3(b), the United States asked China to explain when it will provide its long-overdue subsidies notification under Article 25 of the SCM Agreement. China responds that it will 
submit its notification as soon as possible. This is the same response that China has been giving 
WTO Members for years. As the largest trader among WTO Members, can China provide a date by which it will submit its notification? 
 
Answer 
China has been working hard on preparing the next subsidy notification since the last trade policy review, and is trying to finalize its submission as soon as possible. By now there is still no very 
specific timetable. 
 3. In U.S. question 3(d), the United States asked China when it would reply to the United States 
October 2012 request under Article 25.8 of the SCM Agreement for information regarding 
numerous Chinese support programs. In its request, which can be found at G/SCM/Q2/CHN/46, the United States highlighted China's obligation under Article 25.9 of the SCM Agreement to 
provide the requested information as quickly as possible and in a comprehensive manner. In its 
response to U.S. question 3(d), China states that the United States Article 25.8 request would be considered in the course of China's preparation of its next subsidy notification.  Does China recognize its obligation under Article 25.9 as separate and distinct from its obligation 
under Article 25.1 of the SCM Agreement to provid e a subsidies notification? If so, why is China 
only considering the United States Article 25.8 request in the context of providing its next subsidies notification, which already has been delayed for several years?  
Could China also explain how it interprets the phrase as quickly as possible in Article 25.9 of the 
SCM Agreement?  
Answer 
China is working on preparing a full subsidy notification, which includes Sub-central government 
programmes .  WT/TPR/M/300/Add.1 
 
- 432 - 
 
  
 4. In its response to U.S. question 4(a), China indicates that there are two State Council measures 
that confirm that the China Foreign Trade and Economic Gazette  is China's official journal for 
purposes of fulfilling China's obligation under para graph 2(C)(2) of Part I of China's WTO Protocol 
of Accession to ublish in an official journal all laws, regulations and other measures pertaining to or 
affecting trade in goods, services, trade-related inte llectual property rights or the control of foreign 
exchange. Can China identify all other measures that have been issued to implement China's 
publication obligation? The United States notes that one relevant measure, the 2006 Ministry of 
Commerce (MOFCOM)Letter on Doing Well the Work Relevant to the Implementation of Transparency Provisions of China's WTO Accession Protocol(Shang Ban Han [2006] No. 7), was initially published on the MOFCOM website, but has since been removed. Can China explain why 
this measure was removed from the MOFCOM website?  
 Answer 
As the authority for compiling the China Foreign Trade and Economic Gazette (the Gazette for short), the MOFCOM carefully implements the requ irements of these two documents released by 
the General Office of the State Council, active ly coordinates local governments and relevant 
departments under the State Council to assume transparency-related obligations. The focus is put 
on setting up a mechanism of liaison persons, br ing the initiatives of the local and departmental 
liaison persons into play, demand and support them to contribute to the Gazette in a timely and comprehensive approach. In order to accomplish this task, the MOFCOM issues documents almost 
every year to consolidate the team of liaison persons, render publicity on the work of transparency 
and lay down requirements for manuscript contribution. These documents include: Shang Ban Han [2003] No. 125, Shang Ban Han [2004] No. 139,  Shang Ban Ting Han [2005] No. 95, Shang Ban 
Han [2006] No.7, Shang Ban Ting Han [2006] No.62, Shang Ban Han [2007] No. 4, Shang Ban 
Ting Han [2010] No. 1498, Shang Ban Ting Han [2012] No. 69 and Shang Ban Ting Han [2012] No. 478. 
 
In addition, relevant departments under the State Council also actively implement the requirements of these two documents of the Ge neral Office of the State Council by releasing 
regulations on fulfilling transparency obligations . For example, in 2010, the MOA released the 
Notice of Requirements on Seeking Public Comme nts on the Draft Regulations of the MOA (Nong 
Zheng Fa [2010] No.4), which clearly requires that, in accordance with the Notice on Further Implementing Transparency Articles under China's Accession Protocol (Guo Ban Fa [2006] No. 23), 
public opinions should be solicited on the draf t regulations of the MOA involving goods trade, 
service trade and TRIPS when these draft regulation s are copied to MOFCOM for publication on the 
Gazette. 
 
5. In U.S. question 4(b), the United States asked for information regarding how China is implementing its obligation under paragraph 33 4 of the Working Party Report accompanying 
China's WTO Protocol of Accession to make available translations of all laws, regulations and other 
measures at both the central and sub-central government levels pertaining to or affecting trade in 
goods, services, trade-related intellectual property rights or the control of foreign exchange into one or more of the official WTO languages. In its response, China indicates that the Legislative 
Affairs Commission of the State Council regularly publishes an English edition of the laws of the 
People's Republic of China and that the Legal Affairs Office of the State Council regularly publishes laws and regulations governing foreign-related matters in both Chinese and English.  
For each of the two publications, please explain whether it is available to WTO Members, or 
whether WTO Members must pay a fee to China for obtaining access to it?   Answer 
All the information published on the website admini stered by the Legal Affairs Office of the State 
Council, including laws, regulations and rules,  are available for review free of charge. 
 
Also, please identify the most recent year the publication published English translations and 
explain whether the publication includes all laws and/or administrative regulations pertaining to or affecting trade in goods, services, trade-related inte llectual property rights or the control of foreign 
exchange. 
 WT/TPR/M/300/Add.1 
 
- 433 - 
 
  
 Answer 
Since 1993, the Legislative Affairs Office of the State Council compiles and publishes the Laws and 
Regulations of the People's Republic of China Governing Foreign-related Matters (Chinese/English 
version) each year. The book collects all the administrative laws and regulations (Chinese/English 
version) published by the State Council each year, including those pertaining to or affecting goods trade, service trades, TRIPS or the control of foreign exchange.  
 
6. In response to U.S. question 4(b), China does not identify any publications or websites where it 
makes available English translations of departmental rules or other regulatory documents of the central government. Does this mean that China does not regularly publish English translations of 
departmental rules or other regulatory documents of the central government pertaining to or 
affecting trade in goods, services, trade-related inte llectual property rights or the control of foreign 
exchange?  
 
Answer 
China made it very clear in the response to U.S. question 4(b). 
 
7. In response to U.S. question 4(b), China does not identify any publications or websites where it 
makes available English translations of measures issued by sub-central governments. Does his mean that China does not regularly publish English translations of measures issued by sub-central 
governments pertaining to or affecting trade in go ods, services, trade-related intellectual property 
rights or the control of foreign exchange?  
Answer 
China made it very clear in the response to U.S. question 4(b). 
 
ECONOMIC ENVIRONMENT 
 8. In U.S. question 9(a), the United States sought information regarding draft laws and specifically why 3 of 9 draft laws during 2013 were not published on the NPC website for public comment. 
China's response does not address this question. Could China answer this question? 
 Answer 
China made it very clear in the re sponse to U.S. question 9(a-d). 
 9. In U.S. question 9(b), the United States sought information regarding 65 draft trade-related 
administrative regulations, departmental rules and other measures issued by MOFCOM during 
2013 and specifically why only 4 of these 65 measures were published on the SCLAO website for public comment. In its response, China implies that MOFCOMs measures were published instead on the MOFCOM website. Could China identify how many  of these 65 measures were published on the 
MOFCOM website for public comment? 
 Answer 
China made it very clear in the response to U.S. question 9(a-d). for more details, please check the MOFCOM website.  
10. In U.S. question 9(c), the United States so ught information regarding 125 draft trade-related 
administrative regulations, departmental rules and other measures issued by the National Development and Reform Commission (NDRC) during 2013 and specifically why none of these 125 measures was published on the SCLAO website for public comment. In its response, China implies 
that NDRCs measures were published instead on the NDRC website. Could China identify how 
many of these 125 measures were published on the NDRC website for public comment?  
Answer 
China made it very clear in the response to U.S. question 9(a-d). for more details, please check 
the NDRC website. 
 
11. In U.S. question 9(d), the United States so ught information regarding 135 draft trade-related 
administrative regulations, departmental rules and other measures issued by the Ministry of Industry and Information Technology (MIIT) during  2013 and specifically why none of these 135 WT/TPR/M/300/Add.1 
 
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 measures was published on the SCLAO website for public comment. In its response, China implies 
that MIITs measures were published instead on th e MIIT website. Could China identify how many 
of these 135 measures were published on the MIIT website for public comment? 
 
Answer 
China made it very clear in the response to U.S. question 9(a-d). These measures U.S. mentioned 
were all published on the MIIT website, for more details ,please check the MIIT website. 
 12. At one point in its response to U.S. question 9, China refers to the State Council Legislative A f f a i r s  O f f i c e  S C L A O ) C i r c u l a r  o n  W o r k  R e l a t e d  t o  P o s t  o f  D r a f t  D e p a r t m e n t a l  R u l e s  o n  t h e  
Legislative Information Website for Public Comments (Guo Fa [2012] No. 582), but this 2012 
Circular does not appear to be available on the State Council's Legislative Information Website.  Is this 2012 Circular the same as the August 2011 Circular that is available on the State Council's 
Legislative Information Website at: 
http://www.chinalaw.gov.cn/ article/jg gz/zffzxxgk/201204/2012 0400367359.shtml?  
If not, please explain how WTO Members can obtain a copy of the 2012 Circular. 
 
Answer 
In July 2011, the Legislative Affairs Office of th e State Council released the Circular on Work 
Related to Post of Draft Departmental Rules on the Legislative Information Website for Public 
Comments (http://www.chinalaw.gov.cn/articl e/cazjgg/201204/ 20120400367359.shtm) to the 
legislative affairs sections of all the departments under the State Council. The two documents mentioned by the US is actually one notice. In th e revised response submitted to the Secretariat, 
we have updated the response to question 9 raised by the U.S. The document (Guo Fa [2012] No. 
582) is deleted.   
The United States notes that, according to the August 2011 Circular, drafts of departmental rules 
are required to be posted on the State Councils Legislative Information Website. However, this 
requirement appears to be inconsistent with China's response to U.S. question 9, in which China states that draft departmental rules may be post ed on either the Legislative Information Website 
or on the website of the drafting departme nt for public comments. Please clarify.  
 Answer 
In answering item e of question 9 raised by the US, China states clearly that In July 2011, the 
Legislative Affairs Office of the St ate Council released the Circular on Work Related to Post of Draft 
Departmental Rules on the Legislative Information Website for Public Comments to the legislative 
affairs sections of all the departments under the State Council, in which it is specified that, except 
for a few cases, all draft departmental regulations related to economy and trade shall be publicized on Chinalaw.gov.cn for seeking public comment for a duration of no less than 30 days. In order to 
facilitate the public to post their comment, the dr aft departmental regulations can be publicized on 
the website of relevant departments or through other channels in addition to being published on 
the website: htpp://www.Chinalaw.gov.cn.  
13. In its response to U.S. question 10, China indicates that, in July 2012, MOFCOM published a 
work manual for the China Foreign Trade and Economic Gazette liaison persons. According to China, the work manual, among other things, elaborates on China's WTO transparency 
commitments. Could China make the work manual available to WTO Members?  
 Answer 
The work manual is a training handbook for the liaison persons to learn how to fulfill the 
transparency commitment. Since it is not an official document, it cannot be provided. 
 14. In its response to U.S. question 11, China states that, according to WTO rules and China's 
WTO commitments, China has no obligation to solicit public comments on draft administrative 
regulations and departmental rules. For other WT O Members, the United States notes that China 
has made bilateral commitments to the United States to solicit public comments on drafts of all 
trade- and economic-related administrative regu lations and departmental rules, with a comment 
period of no less than 30 days. For China, the United States notes that, in paragraph 2(C)(2) of Part I of China's WTO Protocol of Accession, China made a multilateral commitment when it agreed that it shall provide a reasonable period for co mment to the appropriate authorities before such WT/TPR/M/300/Add.1 
 
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 measures, meaning all laws, regulations and other measures pertaining to or affecting trade in 
goods, services, trade-related intellectual property rights or the control of foreign exchange, are implemented, subject to certain specified exceptions . On what basis does China assert that it has 
no WTO obligation to solicit public comments on proposed administrative regulations and 
departmental rules?  
Answer 
The China's Accession Protocol Article2, Section C, paragraph 2 states that China shall establish or 
designate an official journal dedicated to the publication of all laws, regulations and other measures pertaining to or affecting trade in g oods, services, TRIPS or the control of foreign 
exchange and, after publication of its laws, regula tions or other measures in such journal, shall 
provide a reasonable period for comment to the a ppropriate authorities before such measures are 
implemented, except for those. According to this paragraph, China only agrees to solicit comments 
from WTO Members within a reasonable time after the publication and before the implementation 
of the approved laws and regulations and other measures, and cannot implement these laws, regulations and measures immediately after their release. Thus, China has no obligation to 
publicize draft version.  
 15. In its response to U.S. question 11, China also references the July 2011 Interim Measures on Solicitation of Public Comment on Draft Laws and Regulations. China notes this this measure is an 
internal document, and it does not appear to be  publicly available. A similarly titled measure 
issued in 2012 appears to be available at:  http://www.chinalaw.gov.cn/article/jggz /zffzxxgk/201204/201 20400367358.shtml.  
However, this 2012 measure is only an excerpt and the full text of the measure is not provided.  
Can China make the full text of the 2011 and 2012 measures available to WTO Members?   
Answer 
In July 2011, the Legislative Affairs Office of th e State Council revised the Provisional Methods for 
Seeking Public Comments on Draft Laws and Regula tions. These methods are used to standardize 
the internal work procedure of the Legislative A ffairs Office of the State Council. They do not 
belong to laws, regulations and other measures pert aining to or affecting trade in goods, services, 
TRIPS or the control of foreign exchange. China ha s no obligation to provide it to WTO members. 
 
TRADE AND INVESTMENT REGIME 
 16. In U.S. Question 14, we had asked China for information regarding the status of various SPS 
and TBT measures that China had failed to notify to the WTO. We appreciate China's detailed 
responses, but those responses still generate significant concerns for the United States.  In cases where China is proposing to adopt an international standard and it represents a change in Chinese law, importers and exporters will need to  know what the proposed new requirements are 
in order to comply with China's standard. That is, even though the proposed new requirements 
may be considered scientifically appropriate in intention and methodology, they represent a change to prior requirements, and importers and ex porters therefore will need to know what they 
are. Will China agree to notify all proposed stan dards to the WTO, even when they represent the 
adoption of international standards? We note that this is already the common practice of the United States, Brazil, Canada, the European Union, Japan and many other WTO Members.  
If China notifies a proposed measure but does not notify the final measure, it is difficult for 
exporters, processors, inspectors and relevant government authorities to know whether or not China has finalized the measure or when and how it will enter into force. Without this knowledge, there is no certainty within the market place as to whether products destined for China are in 
compliance with China's standards, and this uncertainty is a burden on trade. It also undermines 
efforts to protect public health. We note that the United States as well as WTO Members as diverse as Peru, Russian Federation, Viet Nam and South Africa make it common practice to notify the 
final measure. Will China agree to no tify final measures to the WTO?  
We emphasize that all revisions to measures that were previously notified to the WTO should also be notified. Will Chin a agree to notify revisions to the WTO?  
 WT/TPR/M/300/Add.1 
 
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 Answer a-c  
China has been actively performing its obligation of transparent notification and will further do a 
good job in TBT/SPS notification. 
 
TRADE POLICIES AND PRACTICES BY MEASURE  
17. In U.S. question 34, the United States asked China why it continues to maintain export duties 
on numerous products in the wake of multiple panel and Appellate Body findings that paragraph 11.3 of part I of China's WTO Protocol of Accession commits China to eliminate all export duties unless specifically provided for in Annex 6 of the Protocol or applied in conformity 
with the provisions of Article VIII of the GATT 1 994 and, further, that Article XX of the GATT 1994 
is not available to justify a violation of this commitment. In its response, China cites Article XX as its justification for maintaining export duties in violation of paragraph 11.3. Can China explain why 
it believes that Article XX remains available as a justification for its export duties despite multiple 
panel and Appellate Body findings that Article XX is not available to justify a violation of paragraph 11.3? 
 
Answer   
Considering the need for protecting the environment and natural resources, China levies export 
duties on certain resource and energy-consuming products. The number of tariff items to which 
export duties are applicable remains stable in recent years. 
 18. In U.S. question 35, the United States asked China how it justifies the continued use of export 
quotas on a number of raw materials. In its response, China provided the same justifications that 
panels and the Appellate Body have rejected in WTO disputes covering numerous other raw 
materials. Can China clarify whether it has attempted to review or re-evaluate its justifications for 
the continued use of export quotas in light of these adverse panel and Appellate Body rulings?  
 Answer   
The per capita availability of raw material in China is rather low, and China is also faced with 
resource and environmental constraints. In order to protect exhaustible natural resources, China 
takes necessary measures to manage the production, consumption and export of certain raw materials. In the future, China will continue to take necessary measures to exercise scientific 
management on raw materials and products according to actual domestic condition. 
 19. In U.S. question 36, the United States asked China to explain how export contracts are used in 
the administration of the export licensing proc ess for bauxite, coke, fluorspar, manganese and 
silicon carbide. In its response, China does not answer the United States question. China simply states that an exporter is required to submit an  export contract when he applies for an export 
license for bauxite, coke, fluorspar, manganese and silicon carbide, as the United States itself had 
already explained in its question. Could China explain how the export contracts are used in the 
administration of the export licensing process for these materials?  
Answer   
For goods that are subject to general export license management, such as bauxite, coke, 
fluorspar, manganese and silicon carbide, the exporter shall submit an export contract to the 
related licensing authority when he applies for an  export license. This explains the specific 
application of export contract in export licensing process.   20. In U.S. question 42, the United States asked China about policy lending by state-owned banks, 
as referenced in the Secretariats Report. In its response, China states that [c]redit is a volitional 
conduct of market players, into which the Ch inese Government has not intervened. Is China 
asserting that its state-owned banks do not engage  in policy lending? Doesnt Article 34 of theLaw 
of the People's Republic of China on Commercial Banks, which provides that [c]ommercial banks 
shall conduct their business of lending in accordance with the needs of the national economic and social development and under the guidance of the industrial policies of the State, confirm that 
China's state-owned banks engage in policy lending? Why hasnt China ever included policy lending 
by its state-owned banks in any subsidies notifi cation under Article 25 of the SCM Agreement?  
 WT/TPR/M/300/Add.1 
 
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 Answer   
The article 34 of the Law of the People's Republ ic of China on Commercial Banks only lays down 
non-mandatory and policy-oriented requirement for commercial banks engaged in loan business. 
This provision only indicates that commercial ba nks must refer to the industrial policies of the 
State when conducting loan businesses on their own, it does not mean that the State requires commercial banks to grant policy loans. In fact, according to the article 4 of the Law of the 
People's Republic of China on Commercial Banks, the business operations of commercial banks 
shall be governed by the principles of safety, liquidity and efficiency. A commercial bank shall 
make their own decisions regarding their business operations, take responsibility for their own risks, assume sole responsibility for their prof its and losses and exercise self-restriction. A 
commercial bank shall, in accordance with law, conduct business without interference from any 
unit or individual. As  a result, a commercial bank is a market player and shall follow commercial 
principles to conduct credit business.  
 
21. In U.S. question 43, the United States asked China about more than 30 fisheries support programs uncovered by the Secretariat that appe ar to provide subsidies that have not been 
notified by China. In its response, China states that it needed more time and that not much 
information [has been] identified to be specifically related to the fishery industry. However, since becoming a WTO Member in 2001, China has yet to notify a single wild capture fishery subsidy program, despite the fact that the Secretariats investigation uncovered more than 30 fisheries 
support programs and the United States October 2012 request under Article 25.8 of the SCM 
Agreement (G/SCM/Q2/CHN/46) cites to various fisheries support measures, including, for example, the Ministry of Agricultures 11th Five -Year Plan for Nationwide Fishery Development. 
How much more time does China need to notify its fisheries subsidies?  
 Answer   
The criteria for negotiating WTO fisheries subsidies rules are yet to be laid down. There is great 
dispute over fisheries subsidies among WTO members, and there is no consensus on the scope and details of fisheries subsidies. Under such condition, the notifications submitted by WTO 
Members are not comparable. The criteria shall be worked out firstly in the negotiation before the 
specific issues for notification is discussed.  
 22. In U.S. question 45(a), the United States aske d China to describe the nature and extent of the 
financial support provided by financial institutions to the steel industry in 2012. Could China also 
provide this same information for the thermal power, shipping and railways industries?  
Answer   
China's steel enterprises (including thermoelectricity, shipping and railway enterprises) and 
commercial banks are all equal market players which carry out business in accordance with economic rules of the market. The financial support by China's commercial banks for such 
enterprises refers to financial products and services provided in accordance with laws and 
regulations such as the Law on Commercial Banks and principles of the market economy. According to the need of the country's development, Chinese government encourages commercial 
banks to provide more financial support for such sectors as national economy and people's 
livelihood as well as ecological protection, but it do es not interfere, directly or indirectly, in loan 
business of commercial banks.  
 
23. In U.S. question 46, the United States asked China to explain how so-called New Energy Vehicles qualify for consumer subsidies. China responds that [c]urrently vehicles listed in the Catalogue of Recommended Models of New Energy and Energy Saving Vehicles are eligible for the 
subsidies from the central budget. Could China expl ain how New Energy Vehicles can qualify to be 
listed in the Catalogue of Recommended Models of New Energy and Energy Saving Vehicles? In 
providing its response, can China also specifically state whether imported New Energy Vehicles can 
qualify to be listed in this Catalogue? 
 WT/TPR/M/300/Add.1 
 
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 Answer   
First, in 2009, China launched the pilot project on energy saving and new energy vehicles. The 
phase 1 project is completed in 2012. The vehicl es selected for phase 1 project fall under the 
Catalogue of Recommended Models of New Energy and Energy Saving Vehicles. The vehicles listed 
in the Catalogue have all passed expert review. The criteria include requirements for vehicle model, as well as the mass production capacity, quality control capacity and after-sale service 
capacity of the manufacturer of new energy vehi cles. The main objective is to enhance quality 
control of pilot vehicles, ensure the promotion of new energy vehicles, foster consumption market and prevent safety accident from affecting consumption confidence in the new energy vehicle market and sound industrial development. The phase 2 is from 2013 to 2015, with the focus on 
promoting new energy vehicles to government bodies, public institutions and public transport 
systems that are in cities and areas with heavy po llution. The specific conditions and requirements 
for the promotion are being drafted and have not been publicized. The initial consideration is to 
further raise the safety and performance indicators for vehicles, and apply the principles of 
openness, transparency and equal treatment for all types of vehicles. Second , new energy vehicles 
(including domestic and imported), as long as they fall under the criteria and regulation for new  
energy vehicles, are eligible to be included in the Catalogue of Recommended Models of New 
Energy and Energy Saving Vehicles.  
 24. In U.S. Question 54, we had asked about the role of state-trading enterprises (STEs) in 
connection with China's tariff-rate quotas (TRQs). China's response states that China Customs 
does not make import data statistics by the na ture of STEs of or non-STEs enterprise.  
It seems puzzling that no Chinese government ag ency would keep this data. If China Customs 
does not monitor import data statistics by STEs and non-STEs, then can China explain which 
Chinese government agency monitors the fill rates and allocations of each of the TRQs to ensure 
that China's WTO commitments are met? TRQ 
 
Answer   
Since its WTO accession, China carefully fulfills its commitment to managing the import tariff-rate 
quota and the goods of state-trading enterprises. The import tariff-rate quotas for wheat, rice, 
maize and cotton are managed jointly by NDRC an d MOFCOM, while those for sugar, wool, wool 
top are managed by MOFCOM. In line with the pr inciples of openness, transparency and non-
discrimination, NDRC and MOFCOM publish the annual amount of import tariff-rate quota, 
application requirement, allocation principle and related procedure on their official websites. The 
General Administration of Customs of China makes special calculations of TRQ, and the calculation results are used by the management body of ta riff-rate quota to understand the completion of 
total TRQ.  
Enterprises with quota can select the destination country of import, amount and time out of their own accord. They can either make orders by themselves, or entrust other enterprises with trading rights (including STE) to make orders. In additi on to operating state-trading quota, STE may make 
use of their advantage in global market operation to serve as agent for the import of other 
enterprises with quotas. It is difficult to clearly identify the proportions of different enterprises in 
such commercialized foreign trade cooperation in Customs statistics.  
 
Also, with regard to China's TRQs for grains, we  would like to know whether China publishes the 
percentage of actual annual allocations in aggregate form apportioned to STEs and non-STEs. If it 
does, could China explain where this information is published? 
 Answer   
The grains and cotton quota are allocated between state-trading enterprises and private 
enterprises according to China's commitments to WTO. The allocation proportion in each year is 
definite and announced on the website of NDRC.  WT/TPR/M/300/Add.1 
 
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 GOVERNMENT REPORT 
 ECONOMIC AND TRADE ENVIRONMENT AND MACROECONIOMIC POLICY DIRECTION  
 
I n  r e s p o n s e  t o  U . S .  Q u e s t i o n  5 ,  w h i c h  a d d r e s s e s excess production capacity in China's steel 
sector, China states that it has not subsidised the technological upgrading in the steel sector. 
However, the United States notes that, in 2009, for example, the National Development and 
Reform Commission issued the Interim Measure on Revitalizing Focused Industry and Technology Transformation Special Investment Management(Fa Gai Chang Ye (2009) No. 795), which explains how an enterprise can apply to receive funding for its technology upgrade projects and projects 
that support the central governments macro industrial policies in various focus industries, 
including the steel, automobile, textiles and information technology industries. Please explain what China is doing to ensure that its implementation of this measure does not result in further 
increases in excess steelmaking capacity. 
 Answer   
Currently, China's overall steelmaking capacity is excessive, which causes a series of problems 
such as tightening constraints on energy resources. In the next step, alleviating the contradiction caused by excessive production capacity will become  an important task in promoting the structural 
adjustment of the steel sector and optimizing the industry layout. China will exert the decisive role 
is favorable for bringing the market competitiven ess mechanism into play and effectively defusing 
the problem of excessive production capacity. WT/TPR/M/300/Add.1 
 
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 FOLLOW-UP QUESTIONS BY SINGAPORE 
QUESTIONS REGARDING THE SECRETARIAT REPORT 
 
2. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
 Pages 16 – 17 of the written response 
 
Pages 155-156 (Para 4.117)  We note China's reform of tonnage dues. It was in dicated that preferential rates are applicable to 
Chinese vessels and vessels of flag States that have reciprocal most-favoured-nation 
arrangements with China with regard to taxes and dues levied on vessels. We would like to seek clarification on whether preferential rates are the same for both classes of vessels, or if Chinese-
flagged vessels would be subject to the most prefer ential rates followed by vessels of flag States 
that have entered into treaties or agreements with China that include reciprocal most-favoured-nation treatment. We would also like to understand what is meant by "most-favoured-nation 
treatment on a reciprocal basis".  
 Answer 
Pursuant to Article 3 of the Interim Regulation s of the People's Republic of China on Vessel 
Tonnage Dues, preferential rates shall be applicable to the taxable vessels of Chinese nationality 
and taxable vessels the flag states (regions) of which have entered into treaties or agreements that contain clauses offering most favoured nation treatment to each other's taxes and dues levied 
on vessels with the People's Republic of China. Th ere is no preferential rate applicable to Chinese 
vessels.  Most-favoured-nation treatment on a reciprocal basis means vessels of flag States that have 
entered into treaties or agreements with China that include reciprocal equal treatments with 
vessels of other WTO Members.  Follow-up question 
We thank China for the clarification. Our understanding of China's explanation on "most-favoured-
nation treatment on a reciprocal basis" is that most-favoured-nation trea tment would be extended 
to all WTO Members. We would like to co nfirm if this understanding is correct. 
 
Answer 
Thanks for Singapore's question. Article 3 of th e Interim Regulations on Vessel Tonnage Dues of 
The People's Republic of China stipulates: Tonnage  includes common rate and preferential rate. A 
vessel with Chinese nationality or a vessel belonging to a foreign country (region) which has entered into a treaty or agreement with the Peop le's Republic of China for mutual preferential 
treatment of tonnages or fees levied on vessels shall be levied at a preferential rate, while other 
vessels shall be levied at a common rate.  
The principle of preferential treatment has its uni queness in the field of service trade. And most 
WTO Members have reservations to different exte nts in their Schedules of Service Trade. China 
made exceptions of preferential treatment in its marine transport service when it acceded to WTO. 
Please refer to Schedule of Specific Commitments  on services, List of Article II Exemptions for 
China. 
 
On Page 17 of the written response  Pages 156 (Para 4.121) 
 
We note that the report mentions that China intends to establish an international ship registration system. We would like to seek clarity on what th e international ship registration system is and 
what it entails. 
 WT/TPR/M/300/Add.1 
 
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 Answer 
In 2013, the Ministry of Transport replied by lette r to the Tianjin Municipal People's Government 
and the Shanghai Municipal People's Government to allow them to implement the international 
ship registration system on a pilot basis in the Tianjin Dongjiang Bonded Zone and the China 
(Shanghai) Pilot Free Trade Zone. The approved international ship registration system features breakthroughs and innovations in foreign contribution determination of registration body, 
appointment, examination and approval of foreig n crew and age of foreign import and bareboat 
charter foreign ships and vessels.   Follow-up question 
The international ship registration system would be of interest to our shipowners who have, or 
intend to have, vessels operating in China. We would like to know what is meant by "breakthroughs and innovations in foreign contribution determination of registration body". Is the 
international ship registration system meant to cater to bareboat charter in of foreign flagged 
vessels, which would be operating within Chinese waters? Under what circumstances would there be a need to approve the foreign crew? Lastly, what are the documentation that would be issued 
under the international ship registration system?  
 Answer 
According to the international ship registration system implemented on a pilot basis within the 
Tianjin Dongjiang Bonded Zone and the CSPFTZ set fo rth the definition of the ships, which refer to 
the ships owned by an enterprise with legal person status incorporated in the free trade zone in accordance with laws of the People's Republic of China. Where the legal person has foreign 
contribution in its registered capital, the contribution of Chinese investor may be below 50%.  
The international ship registration system includes bareboat charter registration. According to relevant Chinese laws and regulations, an overseas  vessel of bareboat charter may flag China after 
being registered and issued the Certificate of Temporary Chinese Nationality.  
All foreign seafarers on the vessels of Chinese nationality shall obtain the employment license pursuant to Chinese laws and regulations. Crew s holding the valid Certificate of Competency 
issued by other contracting countries of the 1978 International Convention on Standards of 
Training, Certification and Watchkeeping for Seafarers shall apply for the Reorganization Visa of 
the Certificate of Competency issued and obtain re levant identity certificates issued by the local 
government.  
 WT/TPR/M/300/Add.1 
 
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 FOLLOW-UP QUESTIONS BY JAPAN 
Report by the Secretariat (WT/TPR/S/300) 
 
3 TRADE POLICIES AND PRACTICES BY MEASURE 
3.1 Measures Directly Affecting Imports 3.1.8 Standards and other technical requirements  
3.1.8.1 Standards and technical regulations  
 (Question 1: Pages 73-74) [related to Japan's Question 18 of advance written 
questions]  
 
We request China to answer to the 1), Implementa tion of a Marketing Authorization holder (MAH) 
System, because China did not answer.  
 
Answer 
The marketing authorization holder system is a relatively common international drug marketing 
approval system. The separation of marketing auth orization from production authorization helps to 
improve industrial concentration, promote specia lization in the pharmaceutical industry, and 
mobilize the enthusiasm of research and development institutions. But a marketing authorization holder needs to have the whole-process product quality management capability, risk monitoring 
and control capability, and be able to bear the responsibility for drug-caused injury. At present, 
China is studying the applicability, pros and cons  of the system in China based on the level of 
development of the industry, the pharmaceutical ma rket environment, and the security status of 
global supply chain. 
 (Question 2: Pages 73-74) [related to Japan' s Question 18 of advance written questions 
and Page 151, "Streamlining the review proc ess for clinical trial approval", paragraph 
(A) of the answer from China]  We request the current performance and standard operational time for the clinical trial approvals. 
Also, if China have more than one track for reviews of clinical trial approvals, such as "accelerated 
track" for innovative drugs and "normal track for other drugs, we want to know the difference in 
the tracks in terms of the contents of review and the standard operational time from the context of 
streamlining the review process.  
 Answer 
The waiting time for confirmatory clinical trial in 2012 mentioned in the question is 15 months. The reason for the long waiting time is shortage of human resources and heaviness of review tasks of the Chinese drug review and approval authority rather than complication of the review and approval process. Moreover, new drug registration application in compliance with the provisions on 
the Special Review and Approval Procedure for New Drug Registration is subject to special review 
and approval in China; the drug review and approv al authority will handle such applications on a 
priority basis and establish close communication mechanism with the applicants. As for the issue 
of simplifying the review and approval process for non-prescription drugs approved for marketing 
in foreign countries: the imported drugs shall be subject to application for registration and then go through review and approval process. For an imported non-prescription drug, the applicant may 
make a request at the time of import declaration, and then the drug will be reviewed in accordance 
with the same requirements for domestic drugs, and approved if it meets such requirements. Please refer to the 2013 Annual Report of Drug Review and Approval released on CFDA website for the details of clinical trial review and approval status quo, refer to the Rules on Registration 
Management of Drugs for the details of standard cl inical trial review and approval timeline. Please 
refer to the provisions on the Special Review and Approval Procedure for Ne w Drug Registration for 
the similarities of and differences between innovative drug and other drug clinical trial review and 
approval. Please refer to the regulations, normative documents and technical guidelines released 
on CFDA and CDE website for the detailed technical requirements for innovative drug clinical trial.  
 WT/TPR/M/300/Add.1 
 
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 (Question 3: Pages 73-74) [related to Japan' s Question 18 of advance written questions 
and Page 151, "Streamlining the review proc ess for clinical trial approval", paragraph 
(B) of the answer from China]  
 
With regard to "Technical Requirement" for clinical trials of innovative drugs, we request the document for the specific document setting th e technical requirement, from the context of 
streamlining the review process.  
 Answer 
Please refer to the answer to the previous question. 
 
(Question 4: Pages 73-74) [related to Japan' s Question 18 of advance written questions 
and Page 152, "Safety requirements for cosm etic products", paragraph 2 of the answer 
from China]  
 We understand the necessity to enforce the regulation. Our concern is that the regulation which 
title is "National guidelines for application and evaluation of new ingredients for cosmetic products" 
is much stricter than the international standards. We want to know whether China plans to revise the regulation from the basis of international standard.   
Answer 
The guidelines for review and approval for new cosmetic raw materials was published in 2011, and 
then China saw growth in the number of approved  imported cosmetics year by year. The number 
of approved imported cosmetics reached 15598 in  2013, hitting a record high. In addition, it 
should be noted that this normative document sets same requirements for domestic and imported products, without any discriminatory treatment. 
 
3.3 Measures Affecting Production and Trade  3.3.2 Competition policy and price controls  3.3.2.6 Price controls  
 
(Question 5: Page 101, Paragraph 3.169)  Related to the reply to "Question 26 from Japan"  in the RD/TPR/326, it seems there is no 
specific answer to the evaluation standards of qu ality and value of new drugs. Could China explain 
about the evaluation standards of quality and va lue of new drugs to be used during the price 
controlling processes?  
 
Answer 
The Chinese pricing authority actively promotes drug reform. It has formed a set of basic procedures, including cost price survey, expert evaluation or demonstration, solicitation of 
comments from all sides and collective consideration,  established ex-factory drug price survey and 
online monitoring system, improved the pricing in formation management system, and significantly 
improved the scientific nature and transparency of  drug pricing. Currently, with regard to the 
drugs in the Catalogue of Drugs for Basic National Medical Insurance and the monopoly drugs 
outside the Catalogue of Drugs for Basic National Medical Insurance, the maximum retail prices are set by the government, while the transaction prices , such as ex-factory prices, wholesale prices 
and retail prices, are formed by market competition between sellers and buyers. 
 3.3 Measures Affecting Production and Trade 3.3.5 Intellectual property rights 
3.3.5.2 Industrial property  
3.3.5.2.1 Patents   
(Question 6: Page 111, Paragraph 3.202) 
 To establish a transparency examination, we would like to question SIPO again when SIPO 
publishes the relevant guidance for implementation of Article 26.3 of the patent law? Will we have 
an opportunity to provide our opinions on the guideline?  WT/TPR/M/300/Add.1 
 
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 Answer 
According to item 3 of Art. 26 of Patent Law of China, SIPO formulated the guidance opinion to 
intensify the reviews' understanding of laws and regulations to ensure the quality of review. Those 
guidance opinions are in line with Patent Law and are not now criterions. 
 3.3 Measures Affecting Production and Trade  
3.3.5 Intellectual property rights 
3.3.5.2 Industrial property 3.3.5.2.1 Patents   
(Question 7: Page 112, Paragraph 3.207) 
The answer from China to Japan's "Question 38"  seems to be based on a misunderstanding 
of that question. More specifically, although Japan's "Question 38" is one concerning "the 
Regulations on the Administration of Technology Import and Export, as revised in December 2010 
(hereinafter "the Regulation"), China seems to just explain in its answer a provision of "Foreign Trade Law" and "the Catalogue of Technologies Pr ohibited and Restricted from Import", but not 
"the Regulation".  
 Japan would like to invite China once again to answer the following question:  "Could China provide statistics, with a detailed breakdown, on actually concluded technology 
transfer contracts that are subject to the Regulation? In particular, breakdown in terms of 
exporting countries (licensor countries) for technology imports and breakdown in term of importing countries (licensee countries) for technology exports, would be appreciated."  
 
Answer 
The Regulations on the Administration of Technology  Import and Export of the People's Republic of 
China was adopted at the executive meeting of the State Council in December 2001 and took 
effect from 1 January 2002, without amendment till now. The so-called 2010 revision of the 
regulations does not exist. Since the implementati on of the regulations, the Chinese government 
has strictly followed the Foreign Trade Law of the People's Republic of China, the Regulations on 
the Administration of Technology Import and Export  of the People's Republic of China and the WTO 
rules, standardized technology import and export management, maintained the order of 
technology import and export, developed a series of supporting management systems, and formed 
a relatively sound technology import and export  management system, meanwhile, it has gradually 
delegated the review and approval authority to local competent commercial departments according to the unified deployment of the State Council, making the handling procedures much easier and 
the processing time greatly reduced. It is hard to provide relevant statistical data at present. 
 3.3 Measures Affecting Production and Trade 3.3.5 Intellectual property rights  
3.3.5.2 Industrial property  
3.3.5.2.1 Patents   
(Question 8: Page 112, Paragraph 3.208)  
 In the case a patentee is not possible to satisfy all the demands due to the infringing products, 
would he/she be accused of abusing the right?  
 Answer 
According to the item 2 of Art. 48, the abuse of  patent right by patent right owner shall be 
regarded as the action of monopoly. In order to re duce or annul the negative effects of the action 
of monopoly on competition, institutions or persons with conditions could require for compulsory licensing on implementing invention patent or utility model. Whether the act of the patent right 
owner will be regarded as monopoly shall be judged by People 's court or anti-monopoly 
authorities upon Anti-Monopoly Law. In general, whether the act of patent right owner shall be 
regarded as monopoly is not related to infringing products. Without sufficient implementation is 
another situation set by Item 1 of Art. 48 of Pa tent Law for compulsory licensing, which means the 
way of implementation by patent right owner and patent right user authorized by patent right 
owner could not meet the requirement for patented products or methods at the domestic market. WT/TPR/M/300/Add.1 
 
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 3.3 Measures Affecting Production and Trade  
3.3.5 Intellectual property rights 3.3.5.4 Other IPRs  
 3.3.5.4.3 Undisclosed information and trade secrets  
 (Question 9: Page 118, Paragraph 3.243)  
Related to the reply to Japan's "Question 43",  we may need the substantial answer for our 
queries and we would like China to specify the 'relevant authorities'. Showing the guidelines governing such authorities in data protection would also be appreciated.   
Answer 
1. How to determine the data was independently collected by the applicant. First, for drug 
registration application, an applicant is required to provide the description of patent (drug subject 
to registration application or relevant prescripti on, process and use, etc.) and its ownership as well 
as a declaration of non-infringement of patent. CFDA website makes the description of patent and 
its ownership public. Second, for drug registration application, an applicant is required to provide 
domestic and foreign literatures cited in the resear ch. Third, Article 13 of the Rules on Registration 
Management of Drugs provides that an applicant shall be responsible for the authenticity of all 
application materials. 2. The confidentiality obligations of the reviewers. Article 9 of the Rules on Registration 
Management of Drugs provides that the drug regulatory authority and relevant units and personnel 
involved in drug registration shall bear confidentiality obligations on technical secrets and experimental data submitted by an applicant. Rega rdless of domestically collected data or foreign 
data, any data meeting data protection requiremen ts shall be protected by CFDA. In addition, the 
collected data shall meet the needs of evaluation on the drug subject to marketing application.  3.
 The data collection places. Regardless of domestically collected data or foreign data, any data 
meeting data protection requirements shall be pr otected by CFDA. In addition, the collected data 
shall meet the needs of evaluation on the drug subject to marketing application. 4. The monitoring period. It is clearly defined in  the Rules on Registration Management of Drugs. 
Please refer to the 2013 Annual Report of Drug Review and Approval released on CFDA website for 
the details of clinical trial review and approval st atus quo, and refer to the Rules on Registration 
Management of Drugs for the details of standard cl inical trial review and approval timeline. Please 
refer to the provisions on the Special Review and Approval Procedure for Ne w Drug Registration for 
the similarities of and differences between innovative drug and other drug clinical trial review and 
approval. Please refer to the regulations, normative documents and technical guidelines released on CFDA and CDE website for the detailed technical requirements for innovative drug clinical trial. WT/TPR/M/300/Add.1 
 
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 FOLLOW-UP QUESTIONS BY CANADA 
Part 2 Trade and Investment Regime  
2.1 Institutional and Legal Frame work, paragraph 2.12, page 36 
 
It is noted that a 30-day period for public comments is provided in accordance with the Legislation Law and its relevant regulations. They have also indicated that draft laws are published online for 
public opinion, except in the case of laws that are required to be kept confidential. 
 Canada has witnessed in a number of cases that less than 30 days were often offered for public submission. Considering that foreign entities needs to translate Chinese documents and their 
submission, could China explain in which context it decides to provide only a 10- or 20-day period 
for public consultation?   
Answer 
Since 2008, with individual exceptions, all the drafts of laws, administrative regulations, and 
department regulations regarding economy and trade have been published on the Internet, and at 
least 30 days are offered for public consultation st arting from the first day of their publication.  
 Follow-up question China mentioned the existence of exceptions. Could China please outline under which 
circumstances they would not provide a 30 day consultation period?  
 Answer 
Exception are stipulated in Article 2(C) of Protocol  on the Accession of People's Republic of China, 
which provides that except for those laws, regulations and other measures involving national security, specific measures setting foreign exchange rate or monetary policy and other measures 
the publication of which will impede law enforcement. 
 Part 2 Trade and Investment Regime  2.1 Institutional and Legal Frame work, paragraph 2.17, page 37 
 
It is noted that the National Development and Refo rm Commission (NDRC) is in charge of devising 
the overall national economic and social developm ent policy. The NDRC is also responsible for: 
conducting research and setting objectives and policies on economic reform and liberalization; and 
the planning of inbound and outbound investment.   
Could China provide more details on the mandate and all the responsibilities of the National 
Development and Reform Commission (NDRC) rela ted to China's trade policy formulation and 
implementation, including how the NDRC supports the National Leading Group for Comprehensive 
Deepening Reform?  
 
Answer 
As part of its responsibilities, NDRC helps the Ministry of Commerce and other relevant 
departments formulate and implement China's trade policies.  
 Follow-up question  
Grateful if China could list which responsibilities NDRC has the lead on and its core mandate. The 
current response does not Reply the initial question.   Answer 
In accordance with the institutional reform plan of the State Council and the Circular of the State Council Concerning Organizational Structure (Guo Fa [2008] No. 11) approved by the 1st Session of the 11
th NPC, China established the National Development and Reform Commission as a 
constituent department of the State Council. Please refer to the website of NDRC for its main 
duties.  WT/TPR/M/300/Add.1 
 
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 Part 2 Trade and Investment Regime  
2.2.2 Trade policy objectives, paragraph 2.20, page 38  
It is noted that National Leading Group for Comprehensive Deepening Reform was established as a 
result of the Plenary Session's decision; it is ta sked with the responsibility of setting a reform 
roadmap, and with the coordination, promotion, an d supervision of the deci sion's implementation. 
To this end, under the Leading Group, six subgrou ps were established: (a) economic reform and 
environmental protection; (b) democracy and rule of law; (c) cultural issues; (d) social issues; (e) reform of the Party's building system; and (f) disciplinary inspection (anti-corruption).  
 
Could China provide the list of Ministries and Agencies participating in the National Leading Group 
for Comprehensive Deepening Reform and the list of Ministries and Agencies participating in the six subgroups? 
 
Follow-up question Canada would like to reiterate the same question, as it was not replied.  
 
Answer 
Please refer to the important decisions of the Third Plenary Session of the 18th Central Committee 
of the CPC. 
 
Part 3 Trade Policies and Practices by Measure 3.1.6 Import prohibitions, restrictions and licensing, paragraph 3.30, page 65 
 
China's legislation also allows the authorities to restrict imports to allow for the establishment of a particular domestic industry or to accelerate its development. Imports of agricultural, animal and 
fish products may also be restricted if the circumstances so require (Article 16 of the Foreign Trade 
Law). According to the authorities, this provision has never been used.  Could China please elaborate upon how these policies are consistent with China's GATT Article XI 
commitments? Under what circumstances and conditions could this provision be enacted?  
 Answer 
In reality, the Chinese government has never adopted the measures of restriction or prohibition in import/export under the paragraph 7 and 8 of Article 16 in the Foreign Trade Law.  
Follow-up question 
[H]as never adopted does not mean will ne ver adopt. Could China explain under what 
circumstances and conditions could this provision be enacted in future?   
Answer 
China has no and will not maintain any import restriction measures not in compliance with WTO 
rules. 
 
Part 3 Trade Policies and Practices by Measure - 3.1.7.1 Anti-dumping measures, paragraph 3.37, page 67 
 
It is noted that MOFCOM is responsible for determining the existence of dumping, injury and causation and the State Council Tariff Commission (SCTC) makes the final decision as to whether 
to impose anti-dumping duties based upon a proposal by MOFCOM. 
 
Is the SCTC also responsible for making the final decision in countervailing investigations?  
Answer 
According to Article 38 of the Anti-dumping Regula tions of the People's Republic of China, the 
proposal imposing an anti-dumping duty shall be  put forward by the Ministry of Commerce, and, 
on the basis of such a proposal, the State Council Tariff Commission shall make a decision which 
shall be published by the Ministry of Commerce.  WT/TPR/M/300/Add.1 
 
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 Follow-up question 
It is noted that China's response referred to Ar ticle 38 of the Anti-dumping Regulations of the 
People's Republic of China. Could China please clarify whether the Anti-dumping Regulations apply 
to countervailing investigations as well?  
 Answer 
According to Article 39 of the Countervailing Regula tion of The People's Republic of China, the 
proposal imposing a countervailing duty shall be pu t forward by the Ministry of Commerce, and, on 
the basis of such a proposal, the State Council Tariff Commission shall make a decision, which shall be published by the Ministry of Commerce. 
 
Part 3 Trade Policies and Practices by Measure - 3.1.7.1 Anti-dumping measures, paragraph3.40, page 67 
 
It is noted that the imposition of anti-dumping duties must be in the public interest, but that there are no rules specifying how to do this. 
 
As transparent and predictable rules are an import ant element of the multilateral trading system, 
could China please indicate if there are any plans to develop rules on how to factor-in public interest for considering whether to impose a measure? 
 
Has there been any instance where China decided not to impose a measure on the basis of public interest?  
 
Joint answer to questions 1 and 2 
According to Article 37 of the Anti-Dumping Regula tions, imposition of anti-dumping duty shall be 
in the public interest. In an anti-dumping investigation, Chinese investigation authority holds 
hearings and meetings to allow all interested parties, including manufacturers and exporters involved in the case, involved governments, up stream and downstream enterprises and related 
industry associations and importers, to express their views, and seriously considers their 
arguments, so as to ensure an objective, impa rtial and fair investigation. The investigation 
authority will review specific considerations case by case  
Follow-up question 
Could China please clarify whether an anti-dumping investigation has been terminated on the basis of public interest in the past?  
 
Answer 
China has not terminated any anti-dumping investigations on the basis of the public interest.  
Part 3 Trade Policies and Practices by Measure  
3.1.7.1 Anti-dumping measures, paragraph 3.48, page 69  
It is noted that MOFCOM may initiate an interim re view, ex officio or upon request of an interested 
party, provided that a reasonable period of time has elapsed.  
Could China please provide more information on the circumstance under which it may decide to 
self-initiate an interim review and which evidence would be taken into consideration?   Answer 
The Ministry of Commerce has not had any practice of initiating interim review investigations on its own.  
Follow-up question 
On 17 May 2004, MOFCOM self-initiated an interim review in the AD investigation on COLD ROLLED STEEL PRODUCTS imported from the Russi an Federation, Republic of Korea, Chinese 
Taipei, Ukraine, and Kazakhstan. Could China confirm it and explain the reason to self-initiate the 
review?  WT/TPR/M/300/Add.1 
 
- 449 - 
 
  
 Answer 
MOFCOM initiated the review in question beca use the international market situation and the 
demand-supply situation had changed after the application of the anti-dumping measure. On that 
ground, MOFCOM decided to initiate a review on the necessity of the continuation of the anti-
dumping measure.  
3.1.8.2 Product certification, paragraphs 3.73-76, pages 75-76 
 Under the CCC system, only products tested, inspected and certified by Conformity Assessment Bodies (CAB) recognized by the Certification and Accreditation Administration of the People's 
Republic of China (CNCA) can be sold in China. There are 13 mandatory certification bodies, which 
are all domestic entities.   
The process companies must follow in order to test and certify their products under the CCC 
system is lengthy, complicated and costly. This proc ess can also lead to the duplication of work, as 
the same product is often already certified for sale in Canada by a Canadian certification body. 
China committed that it would not maintain multiple or duplicative conformity assessment 
procedures in its Protocol of Accession (paragraph 192).  Canada understands that China recognizes IEC EE-CB test certificates from other IECEE-CB 
members. Does China maintain a list of products for which it recognizes these certificates? Can 
IECEE-CB test certificates be accepted for CCC certification?  
 
Answer 
According to IECEE-CB rules, China recognizes the test certificates issued by other members of the 
IECEE-CB, and the corresponding product list of such recognized test certificates corresponds is 
available at official IECEE website. 
 Follow-up question Canada would appreciate if China could provide an Reply to the second question above, that is: 
Can IECEE-CB test certificates be  accepted for CCC certification? 
 Answer 
As a member of IECEE-CB system, China acknowledg es the CB test certificates issued by various 
member states of IECEE in CCC certification.  Where there is any difference regarding the 
applicable test standards, CCC ce rtification institutions shall also propose the corresponding 
supplementary test requirements in addition to acknowledging CB test certificates. 
 3.1.8.2 Product certification, paragraphs 3.73-76, pages 75-76 
 
Under the CCC system, only products tested, inspected and certified by Conformity Assessment 
Bodies (CAB) recognized by the Certification and Accreditation Administration of the People's Republic of China (CNCA) can be sold in China. There are 13 mandatory certification bodies which 
are all domestic entities. 
 The process companies must follow in order to test and certify their products under the CCC 
system is lengthy, complicated and costly. This proc ess can also lead to the duplication of work, as 
the same product is often already certified for sale in Canada by a Canadian certification body. China committed that it would not maintain multiple or duplicative conformity assessment procedures in its Protocol of Accession (paragraph 192).  
 
Canada understands that China is amenable to accrediting foreign conformity assessment bodies (CAB) through mutual recognition agreements. Coul d China list its agreements and the scope of 
products covered?  
 Answer 
The mutual recognition of Sino-foreign conformity  assessment bodies is performed in a bilateral 
framework. The content of such agreement and the range of products covered are decided by 
specific agreements. WT/TPR/M/300/Add.1 
 
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 Follow-up question 
Could China provide specific examples of such arrangements that have been concluded with 
foreign conformity assessment bodies?  
 
Answer 
Please refer to the website of AQSIQ. 
 
Part 3 Trade Policies and Practices by Measure  3.3.1 Incentives, paragraph 3.119, page 87  
It is noted that China's most recent notification to the Committee on Subsidies and Countervailing 
Measures dates from 2011 and covers programs maintained at the central level during the period 2005-2008. Canada believes that the subsidy notification process is a fundamentally important 
transparency exercise for achieving the aims of  the Agreement on Subsidies and Countervailing 
Measures.   
In its last Trade Policy Review, China indicated that it is working towards incorporating sub-central 
subsidies in its future notifications. Could China please indicate when it plans to provide its next notification to the Committee and clarify whether sub-central programs will be included?  
Follow-up question 
It is noted that China did not provide a response to the question. Could China please clarify when 
it plans to submit its next notification to the Committee on Subsidies and Countervailing Measures 
and whether sub-central programs will be included?  
 Answer 
China has been working hard on preparing the next subsidy notification since the last trade policy review, and is going to propose a time for its submission. China will try to have local programs included in the next notification.  
Part 3 Trade Policies and Practices by Measure  
3.3.1 Incentives, paragraph 3.126, page 88  
The Secretariat report indicates that in addition to  the programmes notified by China, there appear 
to be other support programmes and other means to support different industries (e.g. fisheries) through the provision of grants, policy lending by  state-owned banks and the supply of goods at 
lower than "market price" by state-owned enterp rises (SOEs). However, in the context of this 
Review, no information was provided to the Secretariat regarding these specific programmes or China's industrial policies that support ed different areas of the economy.  
 
Could China provide the list of specific programmes or China's industrial policies that support key 
industrial sectors and explain whether there are plans to increase the transparency of internal administrative measures and the central budget? 
 
Answer 
The Chinese government guides the industry deve lopment directions in the form of a guiding 
catalogue and the catalogue for guiding industry rest ructuring is an important part of the national 
industrial policies. At present, it is the Catalogu e for Guiding Industry Restructuring issued in 2013 
that is in progress. China has been steadily pr omoting various reforms and constantly improving 
the transparency of central budgets. 
 
Follow-up question It is Canada's understanding that the catalogue prov ides a list of the sectors, but does not outline 
the programme or industrial policies that support these sectors. Canada would appreciate if China 
could provide further information n the policies.   
Answer 
Please refer to Items 15, 81 and 83 of China's subsidy notifications (SCM/N/155/CHN and 
SCM/N185/CHN) for the measures of industrial supports. WT/TPR/M/300/Add.1 
 
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 Part 3 Trade Policies and Practices by Measure  
3.3.1 Incentives, paragraphs 3.131-132, page 91  
In China's Government Report, it is noted that, thanks to years of reform, China's state-owned 
enterprises have integrated themselves into market economy. The steps in the next phase of reform will include optimizing the distribution and structure of state-owned economy and ensuring 
the state-owned capital increases its input into public-welfare enterprises (paragraph 2.43).  
 In the Secretariats Report, it is noted that China seems to support state-owned enterprises (SOEs) in different ways, including through the provision of direct transfers to finance wages and 
operating costs, and cheap inputs and credit. This support allows SOEs with low productivity to 
continue to exist, affecting competitiveness.   
Could China please explain how such support is consistent with SOE integration into a market 
economy?   
Answer 
According to the Decision for deepening the reform of SOEs, China shall attach importance to two 
key links. One link is to accelerate the reform in th e diversity of equities of SOEs, actively develop 
the mixed ownership economy, particular efforts shall be made to accelerate the reform of the 
corporate system and shareholding system of parent companies, and further optimize the equity 
structure of SOEs. Strategic investors with advantages in capital, technology, and management and such institutional investors as social security  funds, insurance funds, and equity investment 
funds are encouraged to participate in the restru cturing and reorganization of SOEs. The second 
link is to deepen the management system reform for SOEs and improve the modern corporate system. 
 
Follow-up question Canada thanks China for the reply. Canada would appreciate if China could clarify the last sentence of China's reply. Does this statement me ans that the Chinese government will no longer 
provide direct transfers for the purpose of cheap inputs and credit?  
 Answer 
China seriously honours its WTO commitments to provide foreign investors with a unified, fair, transparent and legal business environment.  
Part 3 Trade Policies and Practices by Measure  
3.3.4 Government procurement: paragraph 3.198, page 109  The Secretariat report states that: Members encouraged China to submit a revised [GPA] offer to 
respond to Parties requests by lowering thresholds, further increasing coverage of sub-central 
entities, and making improvements in other areas.   
Canada would like to know what criteria China has used to determine which provinces and 
municipalities should be covered by China's GPA offer and whether a province should be in Group 
A or Group B.  
 
Answer 
The grouping is based on local level of economic and social development and will respect the wishes of local government. 
 
Follow-up question Canada would appreciate if China could provide further information on which criteria are used to 
define the level of economic and social development?  
 Answer 
The level of economic and social development is mainly the result of comprehensively considering 
such factors as GDP, fiscal revenues and expendit ures, income per capita, industrial structure, 
extent of economic development and open-u p and scale of government procurement. WT/TPR/M/300/Add.1 
 
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 Part 4 Trade Policies by Sector  
4.1.3.2.2 Price controls and mark eting, paragraph 4.29, page 131 
 
According to the Secretariat report, China has gradually liberalized most agricultural markets but 
the Government still intervenes when deemed necessary. Some controls remain in the place regarding the marketing of grains and tobacco. According to the authorities, at present the 
Government only intervenes in the tobacco market.  
 Could China provide additional information regarding the conditions under which a government intervention in an agricultural market would be deemed necessary, and describe those government 
interventions?  
 Answer 
The Government intervenes when food security is threated by the sharp fluctuation in international 
markets. The Government is reforming our domestic support system. One of the reform programs is to implement target price mechanism on a trial ba sis, letting the market play the decisive role in 
maintaining a healthy growth of the agricultural sector. 
 Follow-up questions  Could China provide more information on the target price support they are considering on a trial 
basis, specifically how the price support mechanism might function? For example, it is our 
understanding that, historically, some Chinese pr ovinces implemented price subsidies (instead of 
fixed subsidies) which paid farmers the differenc e between a government-set target price and the 
market price.  
 Answer 
For the purpose of fully exert the decisive function of the market in resources allocation, China has carried out the pilot support programme for the target  price in individual provinces. As an overall 
principle, China must comprehensively consider such factors as planting cost, farmers income and fiscal capabilities and set the target price based on the principle of production cost plus basic 
profit. Currently, this mechanism is at the pilot st age and only adopted in individual provinces on a 
pilot basis.  
Also, would this support mechanism be implemented at a country-wide or a localized level, and 
what commodities might it cover?   
Answer 
Currently, this mechanism is at the pilot stage and only adopted in individual provinces on a pilot 
basis.  
Part 4 Trade Policies by Sector  
4.2.5.3 Rail transport, paragraph 4.130, page 158  
The newly established China Railway Corporation and its duties are described.  
For the new China Railway Corporation, has there been any formal reporting of the corporate results envisioned? In particular: 1) Financial performance; 2) Separate key performance 
indicators for passenger, freight and construction operations. 
 Answer 
It's difficult to predict the business performance for the time being. 
 
Follow-up questions China's response speaks to how the China Railway Corporation (CRC) is performing. Canada's 
question was inquiring as to whether the CRC was considering formal corporate reporting and how 
they would be reporting performance, not what the performance would be.   
Answer 
CRC prepares financial and accounting reports in accordance with the Enterprise Accounting 
System promulgated by the Ministry of Finance and the Regulations on Enterprise Financial and 
Accounting Reports (Decree No. 287 of the State Council); the third party intermediaries shall WT/TPR/M/300/Add.1 
 
- 453 - 
 
  
 audit the authenticity and compliance of the fina ncial and accounting reports and issue the audit 
report; and the financial and accounting reports must be announced to the public periodically in accordance with the Information Disclosure Rules on Debt Financial Facilities of Non-Financial 
Enterprises in the Interbank Bond Market. 
 Part 2 Economic and Trade Environment and Macroeconomic Policy Direction  
2.3.4 Advancing energy conservation, pollution  reduction and industrial restructuring, 
paragraph 2.31, page 9  It is noted that from 2008-2012, China accumulatively closed down backward production 
capacities in iron-making, steel and cement production.  
Could China please provide data on total producti on capacity in the aforementioned industries 
during the period 2008-2012?  
 
Answer 
Only estimated data of the total production capacities for some years are available in terms of 
iron-making, steel and cement production, no exact statistical data could be provided.  
 Follow-up question Could China provide the estimated data?  
 
Answer 
With structural adjustment and excessive capacity control on the iron-making, steel and cement 
sectors, the statistical standards on the overall ca pacity of such sectors are ever changing and the 
estimated data is also being adjusted and chan ging. Therefore, we cannot provide such data 
currently. 
 
Part 2 Economic and Trade Environment and Macroeconomic Policy Direction 2.4 Continuing to Deepen the Reform Steadfastly, paragraph 2.35, page 10 
 
It is noted that the Government's core economic re form is to let the market play the decisive role 
in the allocation of resources and bring the role of the Government into better play.   
Could China please provide more detail on the item s of reform that have already been carried out 
comprehensively and elaborate on plans for further reform?   
Answer 
Since the adoption of the Decision on deepening the reform, policies and measures as well as  
institutional documents have been studied and promulgated in a timely manner in terms of reform of administrative approval, reform of industrial and commercial registration, reform of fiscal and 
tax system and reform of household registration system, which are paid great social attention to 
and looked forward to by all walks of life. Le gal resolutions have even been made for some 
reforms. Generally, these reforms have been acco mplished, promoted the decisive role of the 
market in allocation of resources and gave the government into better play.  
 In the next step, the State will continue to streamline administration and delegate power to lower 
levels, focusing on cancelling administrative appr ovals which greatly impact investment to start a 
business and employment and obviously restrict social and economic development. The state will also deepen the reform of investment approval, ca ncel or simplify the pre-establishment approval, 
and facilitate investment to start a business. 
 
Items subject to Administrative approval will be published in a list, items other than those in the list shall not be subject to administrative approval. China will accelerate exploration on market 
access through the negative list, items other than  those in the negative list will be gradually 
subject to the market entities based on law, so as to achieve the goal that anything can be done as long as it is not prohibited by laws. The industrial and commercial registration will be 
implemented across China to encourage market entities to play their new and dynamic role 
unceasingly. And China will further improve the macro-control system, promote formulation of the goals of macro-control and establish a mechanism for implement relevant polices.  WT/TPR/M/300/Add.1 
 
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 Follow-up question 
It is noted that China intends to reduce the regulatory burden for investments to start businesses and employment. While this is to be commended, could China please also address planned reforms 
regarding the Governments role in providing economic support measures?  
 Answer 
To take the reform on business registration system as an example. China has adopted the subscribed registered capital registration system  instead of paid-in capital system, relaxed the 
registration conditions on registered capital, excluded the paid-in capital as the item to be registered by industrial and commercial authorit ies and changed the annual inspection system to 
the annual reporting and publicity system, which will alleviate the cash pressures on and the 
administrative cost of entrepreneurs and motivate the entrepreneurship.  
Part 2 Economic and Trade Environment and Macroeconomic Policy Direction  
2.4.3 Reform of state-owned enterprises an d development of the non-public sector, 
paragraph 2.43, page 12 
 
It is noted by China that, Thanks to years of reform, China's state-owned enterprises have integrated themselves into market economy. The steps in the next phase of reform will include 
optimizing the distribution and structure of st ate-owned economy and ensuring the state-owned 
capital increases its input into public-welfare enterprises.  
 Does this statement mean that there will be no further reform efforts to reduce the number and 
the role of SOEs in the economy? 
 If China plans to reform the structure of SOEs to  reflect market principles, could China elaborate 
on the rationale for maintaining these entities as SOEs rather than privately-owned entities? 
 Answer for questions 1 and 2 
China will further deepen the reform of SOEs base d on the following three principles: 1. insisting 
on the basic economic system; 2. Insisting on  the market-oriented reform; 3. Insisting on 
separating government administration from the management of enterprises, state assets, and 
separating ownership from management power. In the next step, China will adjust the layout of 
the state-owned economy in accordance with the requirement of the Third Plenary Session of the 
Eighteenth National Congress of the Communist Part y of China, actively develop economy of mixed 
ownership. Whether to reduce the number of SOEs  is not necessarily related to further deepening 
reform of SOEs. China will further specify the main direction and development path of layout of 
state-owned economy, and better serve the national strategic goals based on optimization of the function and overall efficiency of state-owned capital. And China will concentrate state-owned 
capital on major industries and key fields as well as advantageous enterprises .  
 
Follow-up question Canada would appreciate if China could clarify its intention regarding the following statement: 
Whether to reduce the number of SOEs is not nece ssarily related to further deepening reform of 
SOEs. Does this statement mean that China has no intention to further reduce the number of 
SOEs?  
 
Answer 
In recent years, the overall quantity of China' s state-owned enterprises has been decreasing. In 
future, China will continue to promote the optimized allocation of state-owned capital based on the 
principle of developing state-owned enterprises in some sectors while giving private enterprises a 
free hand in other sectors and carrying out work by selection.  WT/TPR/M/300/Add.1 
 
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 Part 2 Economic and Trade Environment and Macroeconomic Policy Direction 
2.4.3 Reform of state-owned enterprises an d development of the non-public sector, 
paragraph 2.43, page 12 
 
The 2012 Secretariat Report looked at SOEs reforms, noting that Mergers/closures during the review period reduced the number of China's SOEs. This report provided figures on the number of 
SOEs, collective-owned enterprises, FIEs an d domestic private enterprises (Table III.8). 
Could China please provide these figures covering years 2011 2012, and 2013?   Answer 
According to the data published by the National  Bureau of Statistics, the number of business 
entities based on registration types is as follows: in 2011 and 2012, 156,323 SOEs, 187,065 collectively owned enterprises, 124,102 foreign-owned enterprises, 106,013 enterprises invested 
by Hong Kong, China, Macao, China and Chines e Taipei and 5,254,870 private enterprises; in 
2012, 159,644 SOEs, 183,870 collectively-owned enterprises, 130,851 foreign owned enterprises, 112,602 enterprises invested by Hong Kong, China, Macao, China and Chinese Taipei, 5,917,718 
private enterprises. 
 Follow-up question  Canada wonders if the mention of "2012" on line 4 of the previous paragraph is a typo since the 
preceding sentence says in 2011 and 2012 and the sentence on line 4 says in 2012.  
 Answer 
Please find the revised reply as below:  According to the data published by the National  Bureau of Statistics, the number of business 
entities based on registration types is as follows: in 2011, 156,323 SOEs, 187,065 collectively 
owned enterprises, 124,102 foreign-owned enterprises, 106,013 enterprises invested by Hong 
Kong, China, Macao, China and Chinese Taipei  and 5,254,870 private enterprises; in 2012, 
159,644 SOEs, 183,870 collectively-owned enterprises, 130,851 foreign owned enterprises, 112,602 enterprises invested by Hong Kong, China, Macao, China and Chinese Taipei, 5,917,718 
private enterprises. 
 Could China please comment on whether the number of SOEs has continued to decrease over this 
period?  
 Answer 
As the SOEs have continuously merged and restructured, the number of SOE groups have decreased steadily. However, due to changes of the economy, the number of SOEs across China increases or decreases all the years, so there is no necessary relation to the said trend.  
Are there plans to narrow the scope of areas where SOE dominance is to be maintained? 
 Follow-up question 
Canada would appreciate if China could provide an Reply this question?  
 Answer 
China's Constitution has explicitly stipulated th e position and role of state-owned economy. In 
future, more state-owned capital will be invested in the important sectors and key areas related to state security and national economy. The state-owned enterprises in other competitive sectors will have to survive by market competition through assets restructuring and institutional adjustment.  
 
Could China list what it considers to be natural monopoly industries and explain why industries fall under this category?  
 
Answer 
To formulate and implement reforms of railway and telecommunications systems. China will launch 
the pilot reform of separating power distribution from power transmission, explore an effective way 
of implementing the separation between power tran smission and power distribution, accelerate the 
building of the regional power market, and promot e rural power system reform in all aspects. 
China will make the divestiture of some industrial administrative functions still assumed by WT/TPR/M/300/Add.1 
 
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 relevant petrol enterprises, sort out the manageme nt system of oil exploration, mining, refining 
and circulation, study and establish the management system for fair access to oil & gas pipe network and universal service, and promote the fo rmulation of a fairly competitive market. China 
will encourage social capital to invest in urban utilities, establish a standardized method for 
investing in public urban utilities by the Government, standards of industrial service and a supervision system for purchasing service and oper ation. China will deepen the reform of highway 
management system, insist that most highways are free of charge, and balance the  development 
of charging highways and non-charging highways. China will reform the management system of air space, establish a mechanism for flexibly using the air space. China will deepen the reform of 
postal service system, improve th e guarantee and supervision system  for universal service. China 
will accelerate the reform of salt industry, remove the monopoly of salt sales .  
 Follow-up questions 
Canada would appreciate if China could provide an reply this question?  
 Also, it is noted that China provided examples sectors where government influence is to be 
reduced. Could China please address which industries it considers to be natural monopolies and 
how such industries are determined?   Answer 
The concepts and definitions on natural monopolies  have been explicitly stipulated in economics 
and are consistent among various countries.  
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