Foreign Tradein China

China entry to WTO China’s entry into the WTO set in motion the most far-reaching

reforms since Beijing since 1978. Over 1100 laws and regulations have been changed since 2001 China can not impose one level of barriers (e.g., tariffs) against one

member country and another level for others China will participate in the WTO's dispute settlement system Manufactured goods saw the largest decrease in tariffs.

Tariffs were eliminated on computers, semiconductors and other information technology products in compliance with the Information Technology Agreement

In agriculture, it has pledged to bind all tariffs and reduce them from an average level of 31.5 percent to 17.4 percent

Foreign car makers will be able to distribute and retail vehicles on their own, and provide financing to buyers.

Application of Import TariffThe Various Import Tariffs Imposed are :

Ad Valorem Duty Specific Duty – apply to beer made of malt, crude petroleum oil,

phototypesetting films Compound Duty – apply to video tape recorders, videotape

reproducers, television cameras and camera with digital image storage

Selective Duty – apply to natural rubber only

Ad Valorem Duty General Tariff Rate – apply to goods imported from and produced in

countries and regions with which China has concluded no agreements for reciprocal tariff preferences

MFN Rate – apply to goods from WTO members and other countries and regions which have preferential agreements with China

The Agreement Rate – apply to goods imported or produced or manufactured in the countries and regions which join together with China into regional trade agreements for tariff preferences

The agreement tariff rate are currently applicable to the imported goods from Korea, Sri Lanka, based on Bangkok Agreement, and Pakistan, Chile based on the relevant agreement with China, goods from ASEAN members, based on the arrangement of CAFTA.

The Special Tariff Rate – apply to goods from countries and regions that have special tariff preferences with China. Currently applicable to imported goods from 39 countries, including Cambodia, Burma, Laos ,Bangladesh and other least developed Africa countries. Zero

rate for goods from Hong Kong and Macao based on CEPA– Closer Economic Partnership Arrangement with Hong Kong and Macao.

Dumping PolicyAccording to the rules of the WTO: a product is to be considered as being dumped, i. e. introduced into the commerce of another country at less than the Normal ValueWhile all the above rules are only suitable to those so-called market economy members. However, according to (ii) (a) Article 15 of the

Protocol on the accession of China to the WTO therefore, there were

many cases ,a third substitution country was used to calculate the cost of Chinese products.Some of the examples of the ridiculous anti-dumping duties to Chinese products:

Mexico Chinese Shoes 1004% Peru Chinese Shoes 903.92% Brazil Chinese Locks 760% Mexico Chinese Pencils 451%

Subsidies

Subsidies is a sum of money granted by the state or a public body to help an industry or business keep the price of a commodity or service low. China has agreed to certain subsidy rules, including rules applicable to state-owned enterprises. Specifically, where government benefits are provided to an industry sector and state-owned enterprises are the predominant recipients or receive a disproportionate share of those benefitsThe following products which have huge subsidies in china.

Grain Vegetable Oil Sugar Tobacco Crude Oil / Processed Oil Chemical Fertilizer Cotton Tea Rice / Corn / Soy Bean Tungsten Ore / Ammonium Paratungstates / Tungstate Products

Local Content RequirementWhen a foreign company makes products in a country, the materials, parts etc that have been made in that country rather than imported. A minimum level of local content is sometimes a requirement under trade laws when giving foreign companies the right to manufacture in a particular place.Under the WTO TRIMS Agreement, China is obliged to eliminate a range of restrictions on international trade and investment, including local content requirements, regardless of whether they are contained in national or local legislation. The TRIMS Agreement also prohibits the Chinese government from enforcing existing contractual agreements that contain local content requirements. The Secret 60, Rule While there doesn't appear to be any explicit local content requirements in any published national or local Chinese regulations, there is the possibility that these may exist in neibu, or internally circulated administrative directives. Recent comments made by officials at the Ministry of Information Industry suggest that this may be the use. One official stated that manufacturers in the People's Republic of China were required to include at least 60% local content in their finished products. The official, however, could not cite any existing local or national regulations where this obligation was set out. Making a Commitment to Use Local Content Another source of local content requirements can be found in the documents prepared by foreign investors in order to form a FIE in China. During the establishment process, Chinese officials insist that

the feasibility study reports prepared by applicants include the stated intention of utilizing locally produced parts and components within their future manufacturing operations. It is also not unusual for foreign investors to be obliged to reiterate this commitment in the FIE% joint venture contract or articles of association. In circumstances where foreign investors are in an unfavorable bargaining position with the approval authorities during the establishment period, these commitments can be quite extensive. Foreign investors may be willing to concede more to the approval authorities in industries where the number of foreign players is tightly controlled, such as mobile phones manufacturing.