The branches and foreign exchange administrative departments of the State Administration of Foreign Exchange (SAFE) in all provinces, autonomous regions, and municipalities directly under the Central Government; the branches in Shenzhen, Dalian , Qingdao , Xiamen , and Ningbo ; and all designated Chinese-funded foreign exchange banks:

In order to expedite the reform of the verification and writing-off system for imports and exports and to achieve the transformation of foreign exchange administration for trade in goods from the current model to aggregate verification, off-site verification, and subject-based supervision, on May 1, 2010 the State Administration of Foreign Exchange (SAFE) launched a program for pilot implementation of the reform of the verification and writing-off system for foreign exchange payments for imports for trade in goods (hereinafter referred to as import verification reform) in seven regions, i.e., Tianjin, Jiangsu, Shandong, Hubei, Inner Mongolia, Fujian, and Qingdao. Based on the results, the SAFE has decided to promote implementation of the import verification reform throughout the country. The relevant issues concerning the reform are hereby notified as follows:

1. The import verification reform aims to promote the facilitation of trade, reduce operating costs for enterprises and banks, and meet the new requirements for foreign trade by transforming the methods and approaches for foreign exchange administration. It is based on authenticity principles and the human-oriented concepts. Efforts will be made to effectively check cross-border capital flows in violation of the laws and regulations by comprehensively looking at and comparing all the information available about cash and goods flows of enterprises and by enhancing constant and dynamic monitoring and analysis. To fulfill this goal, the foreign exchange authorities will collect complete information about foreign exchange payments for imports and the delivery of goods by enterprises and will carry out off-site aggregate comparisons on the strength of the information system, based on which the foreign exchange payments of enterprises for imports will be monitored and analyzed through off-site monitoring and a early-warning mechanism and abnormal conduct will be identified in a timely manner. Based on the information from the off-site monitoring, early warning, and on-site verification, efforts will be made to evaluate and categorize the enterprises. The basic idea of the reform is to achieve a transformation from case-by-case verification to aggregate verification for the administration of foreign exchange payments for imports, from on-site verification to off-site inspection, and from behavioral examination to subject supervision.

2. The Interim Measures for the Administration of Foreign Exchange Payments for the Import of Goods and its detailed rules for implementation (hereinafter referred to as the Interim Measures,see Appendices 1 & 2) shall enter into effect as of December 1, 2010. As of the date of implementation of the Interim Measures, import enterprises shall make foreign exchange payments for imports in compliance with the Interim Measures. The banks will handle foreign exchange payments for import enterprises in compliance with the Interim Measures.

3. The banks shall complete connection of the verification system for the collection and payment of foreign exchange under trade (hereinafter referred to as the verification system) to their business systems and the relevant configurations before November 30, 2010, and shall search the directory of the import enterprises, registration forms for foreign exchange payments for imports, grades for classified evaluation, and so on through the verification system as of the date when the Interim Measures are implemented.

4. The import verification reform is of great significance for promoting the facilitation of trade. The branches of the SAFE, in attaching great importance to the reform, will make the overall work arrangements and endeavor to fulfill the following tasks:

1) Unify awareness of the significance of the reform and play an active role in organizing and leading the reform. All branches shall fully understand the great significance of the import verification reform, form a reform leading group headed by a relevant director to lead and oversee the progress of the reform in their respective jurisdictions, and coordinate with the relevant departments to provide strong support for the reform. Work teams consisting of business and technical staff shall be formed under the reform leading group to be responsible for implementation of the reform and for dissemination and interpretation of the policies, providing business and technical support, feedback, and so forth within their jurisdictions.

2) Implement aggregate verification, dynamic monitoring, and classified administration to improve the effectiveness of the supervision by complying with the relevant provisions of the Interim Measures.

3) Strengthen publicity and training. By complying with the overall planning of the SAFE, the branches shall fulfill their duties to disseminate and interpret the policies through various methods and shall guide and urge banks and import enterprises in immediately comprehending the general idea of the reform and the purposes of the relevant policies. The branches shall provide training of various forms to functionaries of the foreign exchange authorities, banks, and import enterprises within their jurisdictions in an effort to facilitate their comprehension of business operations under the new policies and to ensure the effective implementation of the reform measures.

4) Provide strong technical support for the installation and commissioning of the software for the verification system used in enterprises and banks within their jurisdiction.

5) Report information about implementation of the import verification reform to the SAFE on a monthly basis.

5. Emergency measures

In the event that the verification system malfunctions temporarily due to data-input failures and so forth, the branches shall promptly report the circumstance to the import verification reform office of the SAFE for resolution and shall record the relevant problems. During this period, the foreign exchange authorities shall create a ledger for the import payments for which they are responsible and accordingly shall make a business record.

6. Logging  on to the verification system

Address of the verification system (foreign exchange authority version) http://100.1.63.3:9001/SafeChk/;

Address of the verification system (bank version): http://asone.safe:9101/asone/;

Address of the verification system (corporate version): http://asone.safesvc.gov.cn/asone.

Contact information for the import verification reform office of the SAFE:

Tel.: 010-68402546   010-68402547

Fax: 010-68402594

E-mail addresses:  (Intranet) tradebus@mail.safe

                                            tradetech@mail.safe

                            (Extranet) tradebus@mail.safe.gov.cn

                                            tradetech@mail.safe.gov.cn

All branches (foreign exchange administration departments) of the SAFE shall, as of the date of promulgation of this Circular, make preparations for the relevant work and shall forward this Circular to the central sub-branches (sub-branches), banks, and import enterprises within their jurisdictions as quickly as possible.

affix1:Interim Measures for the Administration of Foreign Exchange Payments for the Import of Goods
affix2:Detailed Rules for Implementation of the Interim Measures for the Administration of Foreign Exchange Payments for the Import of Goods