Excerpt from: China Supply Chain and Logistics Strategy
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| February 08, 2006 | | Summary of China's Free Port Policy | Shanghai Customs provided the following info as part of a larger document posted on the Amcham Shanghai website in late December:
- Policies of the bonded zone, export processing zone and the bonded logistics park will be implemented in the free port.
- Import duty and taxes are suspended until the goods are removed from the free port into the domestic market.
- Domestic goods shipped into the free port are considered exports and entitled to tax refunds.
- Goods transactions within the free port are not subject to VAT and Consumption tax.
The Yangshan free port is to integrate or combine bonded zone, export processing zone with the logistics park so as to form a free trade areas of large size with the multiple functions. It is an enclosed area that is considered outside of China’s customs territory. Practically, the free port tends to involve integrating the functions of transshipment, distribution, processing, procurement and international entrepot trade.
International transshipment: Any goods shipped into Yangshan free port are reconsolidated and shipped to onward destinations. In addition, the free port also provides storage for bonded goods.
International distribution: Business functions including warehousing and logistics will be established in a particular of area of the Lingang Industrial Area. Processing is allowed.
International purchasing: Domestic goods shipped into the port area or the checkpoints at the port are treated as export and entitled to tax refunds. Domestic goods and bonded goods can be consolidated for export or simply processed for distribution both at home and abroad.
International entrepot trade: Companies in the free port are permitted to engage in such activities as transit trade, business transactions and exhibition.
Export processing: A processing zone will be established in part of the land Area in Yangshan free port to carry out processing trade. | | |
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