Tariffs
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China will reduce its average tariff on cosmetics from the current average
of 23.5 percent to 10.7 percent. Most tariff reductions will be completed
by 2004 or 2005. Tariffs on priority exports will be further cut
to 6.5 percent by 2008.
Distribution and Trading Rights
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Prior to its accession, through various means, China restricted the number
of companies that had the right to import and export goods as well as the
types of goods that these companies could import. China has agreed,
upon its accession, to eliminate any export performance, trade or foreign
exchange balancing, and prior experience requirements as criteria for obtaining
or maintaining the right to import and export. Chinese enterprises
will also have full trading rights upon China’s accession, subject to certain
minimum registered capital requirements. Joint ventures with minority
foreign ownership will be granted full trading rights within one year after
accession, and joint ventures with majority foreign ownership will be granted
full trading rights within two years after accession. All enterprises,
including those in the cosmetics industry, will be granted full trading
rights within three years after accession (except with regard to a limited
number of products reserved for state trading enterprises, as identified
in Annex
2A to the Protocol).
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For enterprises and individuals that are not invested in China, the right
to import and export will be granted in a non-discriminatory and non-discretionary
way. Any requirements will be for customs and fiscal purposes only.
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Prior to its accession, China did not generally permit foreign companies
to distribute products through wholesale and retail systems in China or
to provide related distribution services, such as repair and maintenance
services. These prohibitions will be phased out over three years
for most products, including cosmetics. (See sector report on Distribution
Services)
Import Procedures
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China has agreed to bring both its automatic and non-automatic import licensing
systems into conformity with the WTO Agreement on Import Licensing, ensuring
that these systems will not function as trade barriers and will comply
with the principles of national treatment and nondiscrimination.
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China will no longer condition importation or investment approvals on whether
competing domestic suppliers exist or on performance requirements of any
kind, such as export performance, local content, technology transfer, offsets,
foreign exchange balancing, or research and development.
Technical Barriers to Trade
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China must bring all of its technical regulations, standards, and conformity
assessment procedures into conformity with the TBT Agreement. The
same processing periods and fees will apply to both imported and domestic
products and the choice of the assessment body or agency will be at the
discretion of the importer.
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China must apply the same technical regulations, standards, and conformity
assessment procedures to imported and domestic products by authorizing
agencies to assess both types of products during an 18-month transition
period.
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Multiple and duplicative assessment procedures will be eliminated.
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China will only test imported products for conformity with contractual
terms at the request of the parties to the contract and will not require
further conformity assessment procedures (except for random sampling) for
products certified by a body that China recognizes (e.g., UL).
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China must now base technical regulations on international standards.
These regulations must be developed in a transparent manner and applied
equally to domestic and foreign products.
Taxes
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China has agreed to ensure that its laws, regulations, and other measures
relating to internal taxes and charges levied on imports comply with WTO
rules and are applied uniformly to both foreign and domestic enterprises.
This obligation applies not only to national taxes but to provincial and
local taxes as well.
Subsidies
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China has agreed to eliminate all subsidies on industrial goods that are
prohibited under WTO rules, i.e., export and import substitution subsidies.
(See separate report on Import
Related Issues)
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