No. 165.
Mr. Denby to Mr. Bayard.

No. 548.]

Sir: I have the honor to forward to you, herewith, a clipping from the North China Daily News giving the provisional regulations published by the Chinese maritime customs for the bonding of goods.

I have, etc.,

Charles Denby.
[Inclosure in No. 548.]

Bonded Warehouses in China,

general regulations for bonding.

The commissioner of customs sent us yesterday the following regulations, which come in operation on the 1st of January:

The Chinese Government having assented in the revised German treaty to the experimental establishment of bonded warehouses at Shanghai, the following provisional regulations have been drawn up. They are divided into four sections, according as they affect—1, vessels; 2, cargo;3, the custom-house; 4, the bonded warehouse:

1. Rules for the guidance of German vessels.

1. After arrival and consular report, the import manifest of German vessels are to be lodged with the customs.

2. When the consul’s report has been received, the manifest handed in, and permits to land applied for and issued, the vessel will be allowed to discharge.

3. When import cargo has been discharged, export cargo shipped, and dues and duties paid, the customs clearance will be issued. The customs will enter on the clearance the amount of import duties paid on foreign goods and the number of packages of foreign goods bonded upon which duty has not been paid.

4. The rules regarding export duties, coast trade duties, and tonnage dues remain as before.

2. Rules for the guidance of importers.

5. A distinction is made between a vessel’s import foreign cargo and her native cargo. While foreign goods may be bonded or not, at the importer’s option, native goods will be treated as before, i. e., released upon payment of duty, and will not be allowed to be placed in bond.

6. Foreign goods may, at the importer’s option, be either treated as before, i. e., pay duty and be released, or may be bonded. The importer must state on his import application in addition to the description, number of packages, weight, and value of the [Page 247] goods, on which goods he wishes to pay duty and on which he wishes to defer payment, in order that the customs may know whether to issue a duty memo, or a bonding permit.

Local rule 1.—An application for general discharge permit will be held to be an application for importation on payment of duty.

7. The importer must in all cases obtain a bonding permit before landing his cargo and placing it in bond.

Local rule 1.—Goods for which a bonding permit is issued must betaken direct to the bonded warehouse.

8. If the importer wishes to take samples of goods placed in bond, he must first obtain a sample permit from the customs before opening the packages. The bonded warehouse keeper will, upon production of this sample permit, allow the packages to be opened and samples taken, and the original packages will then be closed in whatever way the importer and warehouse keeper may agree upon.

9. When the importer wishes his goods, or any portion of them, to be released from bond, he must supply the customs with a description of the goods, number of packages, weight, value, date of bonding, name of importing vessel, destination, name of exporting vessel, etc., when applying for duty memo., release permit, or shipping permit. Goods for sale in Shanghai, or for re-export to a Yangtze port, must pay import duty before being released from bond. If intended for re-exportation to other treaty ports, or to a foreign port, they will not be required to pay duty before quitting bond.

Local rule 1.—Goods for which a permit to ship in bond (non-duty paid) or a permit to withdraw from bond for shipment is issued must, in case of failure of shipment, be taken direct to the customs jetty for examination application to withdraw from bond for import must then be made for such shut-out cargo.

10. Goods removed from the bonded warehouse without a permit will be confiscated, and the proprietors of the bonded warehouse will be responsible for the amount of the duty leviable.

11. Twelve months are proposed as the limit during which goods may remain in bond. If not applied for by the importer at the expiration of that period, the proprietors of the bonded warehouse must pay the import duty and remove the goods elsewhere.

12. The insurance of bonded goods, warehouse charges, and indemnity for fire or loss, are matters to be arranged between the proprietors of the bonded warehouse and the importers, and do not concern the customs.

3. Regulations to be given effect to by the customs.

13. Seeing that German vessels will arrive with cargo which is, and with cargo which is not, to be bonded, the customs must first receive the consular report and import manifest before issuing permits to discharge, etc.

14. On application from the importer to bond foreign goods, the customs will issue the bonding permit with the permit to land.

15. On application from the importer, the customs will issue a sample permit to open packages in bond for the purpose of taking samples.

16. When the importer desires to dispose of bonded goods in Shanghai, or to re-export them to a Yangtze port, the customs will, upon application, issue a duty memo., and upon production of the receipt will grant a release permit, and, if required, a Yangtze export permit.

17. Upon application from the importer to re-export bonded goods to a treaty port, other than a Yangtze port, or to a foreign port, the customs will issue a release permit and an export permit.

18. The customs will enter on the clearance of each German vessel the amount of import duty paid, and the number of packages placed in bond on which payment of duty is deferred.

19. The form of bond to be entered into by the proprietors of the bonded warehouse, the books to be kept there, the arrangements for either permanently stationing customs officers at the warehouse or for periodical inspection, as well as the rule for the daily routine of work at the warehouse, will be decided by the Shanghai customs as circumstances require.

20. In the quarterly returns of revenue the duty paid on goods released from bond is to be entered in the return for the current quarter; and in the annual trade returns such goods are to be entered under their proper flag. Goods remaining in bond are to be treated, as regards these returns, as yet not imported.

4. Rules to be observed by the proprietors of bonded warehouses.

21. The proprietors of warehouses appointed by the Shanghai customs to store goods in bond must enter into bonds in which they bind themselves to observe all the regulations of the Shanghai customs, and engage that no goods shall enter the [Page 248] warehouse without a permit, and that, once in the warehouse, goods shall not be opened or released without the proper permit; and in the event of goods being so opened or released without permit, the said proprietors bind themselves to pay a fine of so many times the duty leviable on the goods concerned.

Local rule 1.—Bonded warehouses shall be exclusively reserved for the storage of bonded goods.

Local rule 2.—Warehouses now authorized by the Shanghai customs to store goods in bond are as follows, viz:

Warehouse No. 14 at the China Merchants’ Steam Navigation Company’s lower Hongkew wharf, for the storage of bonded cargo ex vessels moored at that wharf, and where arrangements will be made for the reception,” landing, and storage of bonded goods, water-borne, from vessels not moored at that wharf.

The bonding of other warehouses will be made known to the public by a notification displayed at the custom-house.

Local rule 3.—Each door of every bonded warehouse shall be marked in conspicuous letters with the word “bonded;” and each such door will be provided by the customs, but at the expense of the warehouse proprietor, with a second lock, the key of which shall remain in the hands of the customs officers.

22. The proprietors of bonded warehouses must keep books, the form of which will be determined by the customs, in which must be recorded particulars of all goods which enter and leave the warehouse, as well as full particulars of the opening of packages for the purposes of taking samples.

23. Custom officers, whether permanently stationed at the warehouse or coming for the purpose of inspection, shall at all times have access to, and be at liberty to examine, both books and cargo without hindrance on the part of the proprietors of the bonded warehouse.

24. Goods for which the importer has obtained a bonded permit will be checked on arrival at the bonded warehouse by the warehouse keeper in the presence of the customs officer before being stored. At the same time an entry will be made in the warehouse book, and the bonding permit will then be receipted and handed to the customs officer to be filed.

25. On the presentation by the importer of a sample permit to take samples, the bonded warehouse keeper must inform the customs officer, in order that both may be present when the packages are opened and the samples extracted. On the packages being reclosed, the warehouse keeper must make a full entry in the book kept for the purpose, and then hand the sample permit to the customs officer to be filed.

26. When the importer brings to the bonded warehouse a release permit for goods to be disposed of in Shanghai or re-exported to a Yangtze port it will be the duty of the warehouse keeper to inform the customs officer, in order that both may personally see to the release of the goods. The warehouse keeper must at the same time enter the particulars in the prescribed duty-paid book, and then hand the release permit to the customs officer to he filed.

27. When the importer brings to the bonded warehouse a release permit for goods to be re-exported to a treaty port other than a Yangtze port, or to a foreign port, it will be the duty of the warehouse keeper to inform the customs officer, in order that both may personally see to the release of the goods. The warehouse keeper must at the time enter the particulars in the prescribed re-export book, and then hand the release permit to the customs officer to be filed.

28. Twelve months is proposed as the limit during which goods may remain in bond. At the expiration of that period, if the importer has not applied for his goods, the proprietors of the bonded warehouse must pay the import duty and remove them elsewhere.

29. The storage and custody of goods in the bonded warehouse, warehouse charges, insurance, etc., are declared to be private matters to be arranged by the proprietors of the bonded warehouse, and do not concern the customs. The customs, however, are to be kept informed of the warehouse rules.

The above regulations are provisional and subject to alteration, or cancellation, as the Shanghai customs may from time to time decide to be necessary. The four main divisions, however, are to be maintained.