Regulations Governing Customs Bonded Factories Article 26

When the registration of a bonded factory is repealed, its bonded articles shall be dealt with in accordance with the following provisions:1. All bonded articles shall be kept in the warehouse(s) of the said factory to be attached with the sealing tape of the Customs authority or to be locked jointly by the Customs authority and the said bonded factory. The Customs authority shall send its official to inspect the warehouse(s) un-periodically or take the custody of the bonded articles as necessary.2. The repealed bonded factory with repealed registration shall contact the supervising Customs for fixing the date of inventory, or the supervising Customs may fix the date of inventory at its own discretion, so as to take the inventory in accordance with the relevant provisions in Article 20 hereof (the "closing inventory"). In case of discrepancies between the quantities actually inventoried and the quantities in stock as shown in the account book, the provision in Paragraph 1, Article 21 hereof shall apply.3. Subject to the provisions of subparagraph hereunder, the supervising Customs shall, based on the in-stock quantities of bonded articles which have been inventoried, issue the import duties and dues assessment notice in respect of such bonded articles (For finished products and semi-finished products, import duty and dues shall be assessed based on the original form of bonded raw materials used for making such finished and semi-finished products).4. In order to meet the production or export requirements, or to sell the goods to the enterprises in the Science Parks, Technology Industrial Parks, Agricultural Technology Parks, Free Trade Zones or other bonded factories, the bonded factory may, prior to the issuance of import duties and dues assessment notice by the supervising Customs, furnish securities in an appropriate amount and obtain the approval of the supervising Customs, to withdraw the bonded articles to use. However, it shall, within one year from such approval for withdrawal of bonded articles, submit to the supervising Customs for closing of the case the evidentiary documents for exportation of products concerned. Failure to apply for closing the case within the time limit shall cause the Customs authority to offset the securities against the import duties and dues payable thereon.In the case that a bonded factory fails to conduct the closing inventory, the supervising Customs shall issue import duties and assess dues based on quantities in stock as shown in the account book.When a company that established a bonded factory is declared bankrupt by the court and Customs has not repealed the registration of this company, the bonded goods therein shall be disposed of in accordance with the relevant provisions of the Bankruptcy Act; if there is a need to withdraw the goods for use, such bonded goods may be released for use with the approval granted by Customs against an appropriate amount of collateral. The application to Customs for closing the case shall be processed within one year from the day following the aforementioned approval. Otherwise, Customs may offset the collateral against the import duties and dues payable thereon.