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China: New Measures on Prohibited and Restricted Technology Imports

(Mar. 6, 2009) On February 1, 2009, the Ministry of Commerce (MOFCOM) of the People's Republic of China (PRC) issued new Administrative Measures on Technology Prohibited or Restricted from Import, in 21 articles. The Measures will enter into effect 30 days from the date of promulgation and the previous measures, in force since January 1, 2002, will simultaneously be repealed. (The Ministry of Commerce Promulgated the New Version of the Administrative Measures on Technologies Prohibited or Restricted from Import, 4 iSINOLAW WEEKLY (Feb. 9-15, 2009), via e-mail from [email protected]; Measures for the Administration of Prohibited and Restricted Import of Technologies (Decree No. 1, 2009 of the Ministry of Commerce of the PRC) [text in English translation; toggle to Chinese], Invest in China website, (last visited Feb. 26, 2009).)

The Measures emphasize that any technology listed in the China Catalog of Technologies Prohibited or Restricted from Import (Catalog) as prohibited from being imported cannot be imported. For technologies restricted from import, the state adopts a licensing system, whereby importers of technologies listed in the Catalog as restricted from import must apply for a license in accordance with the Measures. However, the Measures do not apply to importation of specialized technologies for national defense and the military industry.

The competent departments of commerce at the province level are in charge of vetting the technology restricted from import and of handling the licensing of such technology in their region. Enterprises under central government management must go through the licensing procedures at the local competent department of commerce pursuant to the given locality's principles.

Importers of restricted technologies must fill in an application form and submit it to the local department of commerce in order to obtain a license. The Measures set time limits for the review of the application and its approval; if it is approved, the local department of commerce will issue a “Letter of Intent of the PRC for a Technology Import License.” Upon receipt of the letter of intent, which is valid for three years, the importer may sign technology import contracts with foreign parties.

After signing a technology import contract, the technology importer will take the letter of intent, as well as a copy of the contract, its annexes, and documents proving the legal status of the contractual parties, to the local department of commerce to apply for the Technology Import License. (Alternatively, an importer of restricted technology may submit a copy of a signed technology import contract, along with any annexes and a certification of the legal status of the contractual parties, in filing an application for the license.) The department is to conduct a review of the application within stipulated time limits; if approval is granted, the department will issue a PRC technology import license to the importer. Contracts for the import of restricted technology take effect on the date of issuance of the Technology Import License.

The Measures prescribe that the MOFCOM is responsible for supervising and examining the work of technology import licensing conducted by the local competent departments of commerce. The local departments must file an annual report with the MOFCOM before January 31 each year on matters related to and items of technology import approved during the previous year. (Id.)