Regulations Governing Customs Bonded Factories Article 10

After a bonded factory has been put under the control of the Customs authority, or has commenced the production of new product and prior to exportation of such product, it shall, within a period of one month beginning from the next day, prepare for each line of product a "Schedule of Raw Materials Used Per Unit of Product" giving therein detailed information on the code numbers, nomenclature, specifications, quantity of the product as well as the stock number, nomenclature, specifications or model number, unit, quantity used (quantity actually used plus quantity of attrition), and submit the same in duplicate to the supervising Customs for reference. Customs may conduct inspections when necessary, and request the production process instructions and other documents that facilitate the inspection. Unless this is done, the exported raw materials used for such products shall not be deducted from the stock accounts. However, if the products exported are sample products, such Schedule may be submitted to the supervising Customs for reference within one month beginning from the next day after exportation, and failure to do so within said time limit shall cause the raw materials used non-deductible from the stock accounts.The quantity used as indicated in an approved "Schedule of Raw Materials Used Per Unit of Product" shall be taken as the basic reference in settling the quantity of raw materials used in the products produced by a bonded factory. No separate attrition account may be declared for scraps and wastes generated in the course of production.After receipt of the said Schedule set forth in Paragraph 1 of this Article, the Customs authority shall after taking reference, examine and grant their approval and return one copy of such documents to the bonded factory concerned for use as the basis for settlement of bonded raw materials.If the "Schedule of Raw Materials Used Per Unit of Product" originally submitted is amended, a new schedule identified by the Number of reference or supervising for the original schedule shall be prepared and submitted to the Customs authority for reference. The time period for submission of such a new schedule by the applicant and for examination and approval of it by the Customs authority shall be the same as those stated in Paragraph 1 of this Article.In case the price, characteristics and functions of raw materials used by a bonded factory are of a similar nature and are interchangeable, a statement to that effect should be given in the Schedule of Raw Materials Used Per Unit of Product and, submitted to the supervision Customs authority for reference.If raw materials mentioned in the preceding paragraph are of Chinese origin whose importation has been granted by the International Trade Administration, Ministry of Economic Affairs, or are subject to countervailing or anti-dumping duties as published by the Ministry of Finance, the importing bonded factory shall assign them particular part numbers and ensure that they will not be interchanged with materials from other sources.The "Schedule of Raw Materials Used Per Unit of Product" shall be valid for a period of three years beginning from the second day of reference or approval by the supervising Customs. The bonded factory shall remake the schedule and submit it to the supervising Customs for reference prior to expiration.The "bill of materials" and the revised Schedule therefrom mentioned in Paragraphs 1 and 4 respectively may be, if approved, stored in an electronic medium for Customs reference. However, if a " bill of materials "contains raw materials which are subject to countervailing or anti-dumping duties as published by the Ministry of Finance, it has to be electronically transmitted through CPT Single Window to Customs for review.