Automotive Working Group Meeting Go back »
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Time2004-11-11 |
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Venue:Automotive Working Group Meeting
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Address:EU Delegation
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Fee:Members: FREE
Automotive Working Group Meeting
11th November 2004
EU Delegation, 15 Dongzhimenwai Dajie
Beijing, 010 6532 4443
Please be advised that there will be an Automotive Working Group (AWG) meeting on 11th November to discuss the recently published Draft Automotive Trade Policy (see attached).
Other topics for discussion will be:
- Translation of the Management Regulation For Imported Automotives Parts
- The outcome of the Automotive Session of the EU-China Conformity Assessment Workshop
- Feedback from the Chamber meeting with MOFCOM yesterday - Briefing from the Auto Components WG meeting in Shanghai last week
- Briefing on the Automotive WG proposals to the WTO II program
Please advise Ms Rhian Kelly on rhiankelly@euccc.com.cn of your attendance by Tuesday, 9th November 2004.
Automobile Trade Policy
(Draft for Soliciting Comment)
October 25, 2004
Chapter I General Provisions
1. This policy is formulated to establish a unified, open, competitive and orderly automobile market, protect the lawful rights and interests of consumers, promote the healthy development of China?? automobile industry, stimulate consumption and expand domestic demand.
2. The State encourages development of automobile trade. The State provides guidance to the automobile trade industry in terms of its overall planning, rational layout, structural adjustment, active use of modern information technology, logistics expertise and advanced business models to improve the level of automobile trade, achieve an intensive and diversified business operation based on scale, brand.
3. In order to create a market environment of fair competition and play up the fundamental role of the market in allocation of resources, and consistent with the objective laws of socialist market economy, efforts will be made to further introduce competition mechanism, expand opening-up both domestically and internationally, remove regional barriers and promote the free circulation of automobile commodities on a nation-wide scale.
4. The automobile trading businesses will be guided to abide by the laws, operate in good faith and honesty, ensure the quality of commodities and services and provide satisfactory services to the consumers.
5. In order to enhance the overall capacity of China?? automobile trade, the State encourages foreign investors with financial strength, advanced business management expertise and marketing skills and well-positioned international sales network to invest in China?? automobile trade sector.
6. Efforts will be made to give full play to the role of industrial organizations, certification agencies and testing agencies as they serve as a bridge between government and businesses, in order to establish and improve an independent, just and standard intermediary agency system which provides evaluation, consulting, certification and testing services to automobile trade. Vigorous efforts will be made to promote the marketisation process of automobile trade.
7. Vigorous efforts will be made to put in place relevant laws and regulations to strengthen the rule of law in automobile trade. Businesses dealing in automobile trade shall meet corresponding eligibilities and conditions. The competent authorities for commerce under the State Council will work with relevant departments to study, formulate and improve the management methods, regulations or standards concerning branded automobile sales, second-hand automobile circulation, circulation of automobile spare parts, reclaim of used or retired automobiles. This is aimed at regulating the market access and business operations of the automobile trade market consistent with law, and maintaining a market with fair competition.
Chapter II Policy Objectives
8. This policy is aimed at, through its implementation, the following objectives:
u create a second-hand automobile circulation pattern with diversified business operators and business models,
u create a multi-functional and sound market system in sales and after-sales services of automobiles and second-hand automobiles,
u open and transparent disclosure of the sources, quality and price of spare automobile parts commodities,
u effectively curb business dealing in fake and shoddy automobile spare parts,
u improve considerably the reclaim and dismantle rate of retired automobiles,
u create a favorable market order in automobile trade.
9. By 2010, establish a modernized automobile trade system compatible with international experience and enjoys an edge, create a number of competitive automobile trade businesses, and achieve a coordinated development of automobile trade and automobile industry.
Chapter III
10. Domestic automobile making enterprises selling automobile products in China shall establish as quickly as possible a sound sales and services system to ensure consumer?? access to good services in the purchase and use of automobiles as well as ensure their lawful rights and interests. Automobile making enterprises may set up sales and services system through their own investment or by authorizing their overall distributors to do so. Approval and authority shall be obtained from automobile making enterprises or their authorized overall distributors before dealing in branded automobile sales activities.
11. Automobile Branded sales and services shall be put in place. Commencing from 2005, passenger automobiles shall implement branded sales and services while commencing from 2006, all automobiles shall implement branded sales and services.
12. Automobile suppliers shall formulate plans for branded sales and service network. To secure consumer?? rights and interests, the distance among automobile sales market, their corresponding automobile spare parts supply and after-sales service station shall not exceed 150 kilometers.
13. Automobile suppliers shall enhance and standardize management of their sales and service network, and provide the public on a regular basis lists of its authorized sales and service enterprises and those whose authorization have been cancelled. No automobile resources shall be made available to un-authorized or un-qualified distributors. The suppliers are obligated to announce on a regular basis the types of automobiles no longer in production and shall take active measures to ensure supply of spare parts within a reasonable period of time.
14. Automobile suppliers shall ensure the automobile quality and after-sales services as guaranteed to the consumers.
Automobile distributors shall explicitly inform the consumers on the business sites all the quality guarantees and after-sales services guaranteed by automobile suppliers and, consistent with the requirement or agreement for authorizing them to deal in such businesses, provide corresponding after-sales services.
Automobile suppliers and distributors shall not supply or sell automobiles that do not meet the requirements as specified in the national technical standards for safety of motor vehicles, or those automobiles that have not passed the national mandatory certification, or automobiles that are not listed in the Catalogue of Road Motor Vehicle Manufacturing Enterprises and Products.
15. Automobile suppliers and distributors shall, through signing of written contract, specify their respective rights and obligations. Automobile suppliers shall provide guidance and technical support to the distributors and shall not ask the distributor to agree to unequal terms or conditions for cooperation. Nor shall automobile suppliers impose sales quota on distributors or ask them to have bundling sales. Suppliers shall not arbitrarily terminate cooperation with distributors.
16. Applicant for becoming overall distributors or distributors should submit relevant documents and papers to the industrial and commerce administration departments under the State Council for verification and file for record to competent commerce authorities.
The industrial and commerce administration departments under the State Council shall publicly announce the names of all overall distributors, or brand distributors that have completed required procedures. And based on the announcement, local industrial and commerce administration departments will process the registration procedures for overall distributors and brand distributors. The license for branded automobile sales shall be uniformly registered as branded automobile sales license.
Chapter IV Circulation of Second-hand Automobiles
17. The State encourages circulation of second-hand automobiles. Efforts will be made to set up competition mechanism, expand circulation channels, and further liberalize sales in second-hand automobiles. The State encourages well-positioned brand automobile distributors and other business operators to deal with second-hand automobile business, set up branches in regions outside their own and enter into chain operation.
18. Efforts will be made to cultivate and develop the second-hand automobile market. Vigorous efforts will be made to create conditions to simplify procedures for second-hand automobile business and transaction registration, improve efficiency in verifying the legitimacy and safety of local automobiles from other regions, reduce transaction and registration cost, unify the format of invoice for transaction, strengthen regulation of the second-hand automobile quality, encourage the second-hand distributors to provide qualified after-sales services.
19. Efforts will be made to initiate a change of concept in the second-hand automobile trading market, strengthen and expand market services and management functions, play the due role of trading places in the circulation of second-hand automobiles. The function of second-hand automobile trading places should be to provide sites and relevant services for sales of second-hand automobiles. Second-hand automobile trading places shall not directly engage in business activities.
20. Implement a voluntary second-hand automobile evaluation system. Except automobiles related with state-owned assets, prices of all other second-hand automobiles shall be negotiated and agreed between sellers and buyers. The parties involved may voluntarily authorize a qualified certification agency for evaluation for reference when transaction is made. No unit or department shall impose explicitly or implicitly evaluation of traded automobiles unless otherwise provided for under laws and regulations.
21. Establish and improve a license system for specialists in evaluation of second-hand automobiles. Individuals responsible for evaluation of second-hand automobiles shall pass a unified standard examination and obtain the license of qualification for practicing second-hand automobile evaluation from the labor and social security departments under the State Council.
22. Actively regulate the evaluation and certification of second-hand automobiles. Relevant agencies and individuals shall follow the principle of being ??bjective, truthful, fair and open??when they deal in second-hand automobile evaluation businesses and issue evaluation report consistent with relevant state laws and regulations.
23. Second-hand automobile business enterprises shall provide genuine information to the buyers when selling automobiles, and provide after-sales services. They shall not withhold information or engage in deception. The sold automobiles shall be equipped with motor vehicles registration certificate as well as motor vehicle on-road license as well as valid annual inspection certificate issued by public security and transport departments and environmental departments.
24. The establishment of second-hand automobile auction company or second-hand automobile evaluation agencies shall seek approval from commerce administration departments at the provincial level or above.
Chapter V Circulation of Spare Automobile Parts
25. The State encourages the circulation of spare automobile parts based on scale, brand and network through franchise or chain marketing. The State supports enterprises in consolidating resources and structural upgrading to improve the efficiency of scale and service levels.
26. Suppliers and distributors of automobiles or spare automobile parts shall strengthen quality control and improve the quality of their products and services.
Suppliers and distributors of automobiles or spare automobile parts shall not provide or sell spare automobile parts that do not meet the requirements as specified by national laws, administrative rules, mandatory standards or mandatory certification.
27. Suppliers or distributors of automobiles or spare automobile parts shall publish on a regular basis the lists of their authorized distributors of automobile spare parts as well as those whose authorization have been cancelled.
Distributors of spare automobile parts shall explicitly disclose information concerning the name, manufacturer, price of the spare automobile parts or other automobile items that they sell. Distributors shall make specific notice on the sources of the spare parts, be they come from the original automobile makers, makers authorized by the original automobile producers, reclaimed parts from retired automobiles or renovated ones. Labels of automobile spare parts products shall comply with the requirements of product quality laws.
28 Speed up the standardization of circulation of scrapped vehicle?? reusable components. Licensed vehicle dismantlers must identify the saleable parts disassembled according to relevant regulations with a clear sign read as ??eused components of scrapped vehicle??
Chapter VI Vehicle Retiring and Reclaim
29 The State applies a mandatory vehicle retiring policy. Contemporary vehicle retiring standards specifying various mandatory thresholds shall be formulated and amended according to the safety and technical parameters of the vehicle as well as the different purposes it serves.
30 The owner of the used vehicle shall submit or sell the vehicle to licensed scrappers in time.
31 Local executive authorities shall have an effective and reasonable overall planning for the scrapping industry in conformity with The Regulation on Reclaim of Retired Vehicles.
Entities shall fulfil the qualifications provided in The Regulation on Reclaim of Retired Vehicles to become eligible scrapper. The administrative commercial authority under the State Council shall announce the names of eligible scrapper.
32. Licensed scrapper must operate in strict terms with relevant national laws and regulations to dismantle reclaimed used vehicles. The ??ive main parts?? namely the engine, front-rear axle, transmission, steering gear and chassis, shall be considered as waste iron and steel and transported or sold to iron and steel manufacturers for metallurgical use.
33 The administrative commercial authority under the State Council shall work with public security agencies to establish an information management system on reclaim of used or retired vehicle, establish real-time monitoring over the reclaim process, with a view to stopping retired vehicles or the five parts as defined in article 32 from being used again.
34 The State encourages used or retired vehicle dismantling and upgrading and actively implements and improves relevant subsidy measures. Eligible owners may apply for financial subsidy accordingly.
35. Licensed scrapper must comply with relevant laws and regulations relating to the storage, transport and disposal of disassembled components, other wastes and hazardous material (i.e. oil, fluid, battery and hazardous metals), including The Law on Environmental Protection, The Law on the Prevention of Atmospheric Pollution, to ensure safety and zero-pollution (or minimum pollution).
Chapter VII Trade Related Matters
36 The State shall enact the automatic licensing management on imported vehicles as of 1 January 2005. No bonded area in any port of entry shall be used to store vehicles bound for domestic market.
37 The State prohibits the import of used vehicle, major/spare components and right-handed drive cars by any means of trade (not including right hand drive car samples used for developing cars for export).
38 Imported vehicles must bear the State Compulsory Product Certificate, certification label and user?? guide in Chinese language.
39 Prohibit unfair trade practice in auto import. The administrative commercial authority under the State Council shall exercise anti-dumping, anti-subsidy and safeguards measures on the auto industry consistent with law, organizes relevant industrial associations to set up and improve the early-warning system for potential industrial injury and carries out surveys and research on the competitiveness of the auto industry. Automobile suppliers and distributors have the obligation to provide real-time and accurate information to the commercial departments under the State Council.
40 Encourage the trade in automobile and relevant products. Efforts shall be made to foster and develop state-level export bases for automobiles and components and guide competitive suppliers and distributors to establish overseas sales & service network in forms of joint venture, cooperative or wholly-owned enterprises, with a view to optimizing the export mix and exploring overseas markets.
41 Support the efforts to develop automobile trading by using the foreign trade development fund of the Central Government.
42 Export suppliers and distributors of automobile and relevant products are required to set up necessary sales & service network in line with laws and regulations of the destination region.
43 Strengthen inter-governmental consultation in an effort to support Chinese suppliers in cases of anti-dumping, anti-subsidy and safeguard measures, with a view to protecting the legitimate rights and interests of the domestic suppliers.
44 Give full play to industrial associations in order to enhance self-discipline and introduce an orderly foreign trading system for auto products.
Chapter VIII Other Issues
45 Setting up of foreign invested auto trading enterprises shall comply with due qualification and application procedures provided for in this paper, and in line with other relevant laws and regulations regarding foreign investment, approved by the provincial commercial authorities and approved by the competent authority under the State Council. In this respect, application of foreign invested auction house for second-hand cars is subject to direct inspection and approval from the competent authority under the State Council.
46 The competent commercial authority under the State Council and the departments for industrial, commercial and administrative management could commission industrial association to form an experts??panel to review the qualification of applicants who want to become overall distributor and franchise dealer. The opinions of the panel shall be used as reference for approval or verification.
47 Further develop auto loans business, support competitive suppliers to set up auto financing companies oriented towards the entire industry and guide auto finance agencies in establishing cooperation mechanism with other financial institutions, in a bid to bring the auto credit lending market to a larger scale with improved standards and risk management system.
48. Develop the auto insurance market by encouraging personalized and diversified insurance products as well as qualified service, with a view to fostering professional and intensive auto insurance business.
49 Policies, systems and regulations formulated by local governments relating to auto trading shall be open, transparent and in line with this policy paper. The provisions shall contain no discriminative policies on the circulation, service and use of automobiles produced or traded outside the localities. The provisions shall also prohibit in strict terms the compulsory sale of locally made cars to local consumers or any forms of interference in distributors??choice of automobiles which are produced and sold consistent with State approval.
50 This policy paper will enter into force 30 days after the date of issuance. The competent commercial authority under the State Council is responsible for its interpretation.
Annex: Terminology in automobile trading policy
1. ??utomobile trading?? include the sales of new vehicles, circulation of second-hand vehicles, circulation of spare parts, vehicle scrapping and reclaim, foreign auto trade and other related aspects.
2. ??utomobile?? ??assenger vehicle??and ??ommercial vehicle?? refer to the vehicles as defined under the PRC national standards (GB/T3730.1-2001) Terminology and Definition of Vehicles and Trailers
3. ??econd-hand vehicle?? refers to the vehicles whose ownership is transferred between the period of completion of its registration procedures and the period of meeting the requirements for retirement as specified by national standards.
4. ??upplier?? refers to automobiles or spare parts producer and its overall distributor.
5. ??istributor?? refers to retailers of automobiles or spare parts.
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2004-10-26 15:00
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