Administrative Regulations of the People's Republic of China on Technology Import and Export (Revised in 2011)

Order of the State Council of the People's Republic of China No.588

January 8, 2011

(Promulgated by Order of the State Council of the People's Republic of China No.331 on December 10, 2001 and revised in accordance with the Decision of the State Council on Repealing and Revising Certain Administrative Regulations on January 8, 2011)

Chapter I General Provisions

Article 1 The Administrative Regulations of the People's Republic of China on Technology Import and Export (Revised in 2011) (hereinafter referred to as the "Regulations") are hereby formulated in accordance with the Foreign Trade Law of the People's Republic of China (hereinafter referred to as the Foreign Trade Law) and the relevant provisions of other relevant laws with a view to regulating the administration of technology import and export, maintaining the order of technology import and export, and enhancing the national economic growth and social development.

Article 2 For the purpose of the Regulations, technology import and export refers to acts of transferring technology from outside the territory of the People's Republic of China into the territory of the People's Republic of China or vice versa by way of trade, investment, or economic and technical cooperation.
The acts mentioned in the preceding paragraph include assignment of the patent right, assignment of the patent application right, licensing for patent exploitation, assignment of technical secrets and technical services, and transfer of technology by other means.

Article 3 The State adopts a uniform system for the administration of technology import and export, and maintains the order for fair and free technology import and export in accordance with the law.

Article 4 Technology import and export shall be conducted in compliance with the national policy on industries, the policy on science and technology, and the policy on social development, and shall be conducive to promoting the scientific and technological progress in China, enhancing the development of foreign economic and technical cooperation, and safeguarding the economic and technical rights and interests of the country.

Article 5 China permits free technology import and export, except as otherwise provided for by laws and administrative regulations.

Article 6 The competent department of foreign trade and economic cooperation under the State Council (hereinafter referred to as the "competent foreign trade department under the State Council") is responsible for the national administration of technology import and export in accordance with the provisions of the Foreign Trade Law and the Regulations. The competent foreign trade departments under the people's governments of provinces, autonomous regions and municipalities directly under the Central Government shall, according to the authorization by the competent foreign trade department under the State Council, be responsible for the administration of technology import and export in their respective administrative regions.
The departments concerned under the State Council shall, in accordance with the provisions of the State Council, perform the relevant functions and responsibilities for the administration of projects of technology import and export.

Chapter II Administration of Technology Import

Article 7 The State encourages the import of advanced and appropriate technologies.

Article 8 Import of any technology falling under any of the circumstances set out in Article 16 of the Foreign Trade Law shall be prohibited or restricted.
The competent foreign trade department under the State Council shall, in concert with other relevant departments under the State Council, formulate, regulate and publish catalogs of technologies the import of which is prohibited or restricted.

Article 9 Technologies prohibited from import shall not be imported.

Article 10 Technologies restricted from import shall be subject to license administration; any technology for which no license is granted shall not be imported.

Article 11 In respect of import of a technology restricted from import, an application for technology import, together with the relevant documents, shall be filed with the competent foreign trade department under the State Council.
Where a project of technology import needs to be approved by the relevant department, the documents of approval by such department shall also be submitted.

Article 12 The competent foreign trade department under the State Council, upon receipt of an application for technology import, shall conduct an examination, in concert with the relevant departments under the State Council, of the application, and make a decision of approval or disapproval within 30 working days of receipt of the application.

Article 13 Where an application for technology import is approved, the competent foreign trade department under the State Council shall issue a letter of intent for licensing technology import.
After being granted the letter of intent for licensing technology import, an import operator may sign a technology import contract with its overseas counterparty.

Article 14 After signing a technology import contract, an import operator shall submit to the competent foreign trade department under the State Council a copy of the technology import contract and the relevant documents to apply for a technology import license.
The competent foreign trade department under the State Council examines the authenticity of the technology import contract, and makes a decision of approval or disapproval of the technology import, within ten working days of receipt of the documents provided for in the preceding provision.

Article 15 An applicant, when applying to the competent foreign trade department under the State Council in accordance with Article 11 of the Regulations for technology import, may submit a copy of the technology import contract concluded.
The competent foreign trade department under the State Council shall, in accordance with Articles 12 and 14 of the Regulations, examine the authenticity of the application and the technology import contract, and decide, within 40 working days of receipt of the documents provided for in the preceding provision, to approve or disapprove the technology import.

Article 16 Where technology import is approved, the competent foreign trade department under the State Council issues a technology import license. The technology import contract takes effect on the date of issuance of the technology import license.

Article 17 Freely importable technologies shall be subject to contract registration administration.
A contract for importing a freely importable technology takes effect from the time when the contract is established in accordance with the law, without taking the registration thereof as a condition for the contract to be effective.

Article 18 When a freely importable technology is to be imported, registration shall be made with the competent foreign trade department under the State Council, with the following documents submitted:
1. an application for the registration of the technology import contract;
2. a copy of the technology import contract; and
3. any document certifying the legal status of the two parties to the contract.

Article 19 The competent foreign trade department under the State Council shall register a technology import contract and issue a certificate of registration of the technology import contract within three working days of receipt of the documents provided for in Article 18 of the Regulations.

Article 20 Applicants shall go through the foreign exchange, banking, taxation, customs and other relevant formalities on the strength of the technology import license or certificate of registration of the technology import contract.

Article 21 Where a technology import contract licensed or registered in accordance with the Regulations is changed in terms of the main content thereof, formalities shall be gone through once again for the license or registration thereof.
Where any licensed or registered technology import contract is terminated, record-filing shall be undertaken with the competent foreign trade department under the State Council in a timely manner.

Article 22 Where an enterprise with foreign investment is set up with the foreign party contributing a technology as its investment, the import of the technology shall be examined or registered according to the procedure for the examination and approval of the establishment of an enterprise with foreign investment.

Article 23 The competent foreign trade department under the State Council, other relevant departments and the employees thereof shall be under an obligation to keep confidential any trade secret that they come to know when performing their functions and duties of technology import administration.

Article 24 The grantor in relation to a technology import contract shall ensure that he or she or it is the legitimate owner of the technology supplied or one who has the right to assign or license the technology.
Where the grantee in relation to a technology import contract is accused of infringement by a third party by using the technology supplied by the supplying party under the contract, the former shall immediately notify the latter; the latter shall, upon receipt of the notification, assist the former in removing any impediment.
Where the grantee in relation to a technology import contract infringes another person's legitimate rights and interests by using the technology supplied by the grantor under the contract, the grantor shall bear the liability therefor.

Article 25 The grantor in relation to a technology import contract shall ensure that the technology it supplies is complete, accurate, effective and capable of achieving the agreed technical object.

Article 26 The grantee and the grantor in relation to a technology import contract shall be under an obligation to keep confidential the undisclosed part of the technology that the grantor has supplied within the scope of confidentiality and time limit thereof as agreed in the contract.
Within the time limit of confidentiality, the obligation of one party to confidentiality shall terminate immediately after the confidential technology is disclosed for reasons not attributable to the party.

Article 27 Within the term of validity of a technology import contract, an achievement made in improving the technology concerned belongs to the party making the improvement.

Article 28 After a technology import contract expires, the technology grantor and grantee in relation thereto may negotiate the continued use of the technology according to the principles of justice and equity.

Article 29 A technology import contract shall not contain any of the following restrictive clauses:
1. requiring the grantee to accept any additional condition unnecessary for the technology import, including buying any unnecessary technology, raw material, product, equipment or service;
2. requiring the grantee to pay an exploitation fee for a technology when the term of validity of the patent right to which has expired or the patent right to which has been invalidated, or to undertake other relevant obligations;
3. restricting the grantee from improving the technology supplied by the grantor, or restricting the grantee from using the improved technology;
4. restricting the grantee from obtaining a technology similar to that supplied by the grantor from other sources or from obtaining a competing technology;
5. unduly restricting the grantee from purchasing raw materials, parts and components, products or equipment from other channels or sources;
6. unduly restricting the quantity, variety, or sales price of the products that the grantee produces; or
7. unduly restricting the grantee from utilizing the channel for exporting products manufactured using the imported technology.

Chapter III Administration of Technology Export

Article 30 The State encourages the export of well-developed industrialized technologies.

Article 31 Any technology that falls under any of the circumstances set out in Article 16 of the Foreign Trade Law is prohibited or restricted from export.
The competent foreign trade department under the State Council shall, in concert with other relevant departments under the State Council, formulate, regulate and publish catalogs of technologies which are prohibited or restricted from export.

Article 32 Technologies prohibited from export shall not be exported.

Article 33 Technologies restricted from export shall be subject to license administration; and shall not be exported without a license.

Article 34 To export any technology restricted from export, an application shall be filed with the competent foreign trade department under the State Council.

Article 35 The competent foreign trade department under the State Council shall, upon receipt of a technology export application, examine the technology in respect of which the application for export is filed in concert with the science and technology administrative department under the State Council, and decide to approve or disapprove the application within 30 working days of receipt of the application.
Where a technology restricted from export requires confidential examination by the relevant department, the relevant provisions of the State shall apply.

Article 36 Where an application for technology export is approved, the competent foreign trade department under the State Council shall issue a letter of intent for licensing technology export.
Before obtaining the letter of intent for licensing technology export, an applicant may not begin substantive negotiations with the foreign party, or conclude a technology export contract.

Article 37 After concluding a technology export contract, an applicant shall submit to the competent foreign trade department under the State Council the following documents, to apply for a technology export license:
1. a letter of intent for licensing technology export;
2. a copy of the technology export contract;
3. a list of technical information relating to the technology export; and
4. any document certifying the legal status of the two parties to the contract.
The competent foreign trade department under the State Council examines the authenticity of the technology export contract, and decides, within 15 working days of receipt of the documents provided for in the preceding provision, to approve or disapprove the technology export.

Article 38 Where a technology is licensed for export, the competent foreign trade department under the State Council issues a technology export license. The technology export contract takes effect on the date of issuance of the technology export license.

Article 39 Freely exportable technologies shall be subject to contract registration administration.
A contract for exporting a freely exportable technology takes effect from the time when the contract is established in accordance with the law without taking the registration thereof as a condition for the contract to be effective.

Article 40 When a freely exportable technology is to be exported, registration shall be undertaken with the competent foreign trade department under the State Council, with the following documents submitted:
1. an application for the registration of the technology export contract;
2. a copy of the technology export contract; and
3. any document certifying the legal status of the two parties to the contract.

Article 41 The competent foreign trade department under the State Council shall, within three working days of receipt of the documents provided for in Article 40 of the Regulations, register a technology export contract, and issue a certificate of registration of the technology export contract.

Article 42 Applicants shall go through the foreign exchange, banking, taxation, customs and other relevant formalities on the strength of the technology export license or certificate of registration of the technology export contract.

Article 43 Where a technology export contract licensed or registered in accordance with the Regulations is changed in terms of the main content thereof, formalities shall be gone through once again for the license or registration thereof.
Where a licensed or registered technology export contract has terminated, record-filing shall be undertaken with the competent foreign trade department under the State Council.

Article 44 The competent foreign trade department under the State Council, other relevant departments and the employees thereof shall be under an obligation to keep confidential state secrets and the trade secrets that they come to know when performing their functions and duties of technology export administration.

Article 45 Exporting a nuclear technology, a relevant technology of nuclear products for both military and civilian purposes, a technology for supervising or monitoring the manufacture of chemicals, a technology for military purposes, or any other technology under export control shall be conducted pursuant to the relevant administrative laws and regulations.

Chapter IV Legal Liability

Article 46 Any act of importing or exporting a technology prohibited or restricted from import or export without approval shall be prosecuted for criminal liability according to the provisions on the crimes of smuggling, illegal business operation, or divulging state secrets or other crimes under the Criminal Law. Where such act is not so serious as to be prosecuted for criminal liability, a penalty shall be imposed depending on the circumstances pursuant to the relevant provisions of the Customs Law, or the competent foreign trade department under the State Council shall issue a warning, confiscate illegal income, if any, and impose a fine of not less than one times but not more than five times the illegal income. The competent foreign trade department under the State Council may concurrently revoke the foreign trade business license.

Article 47 Any act of importing or exporting technology restricted from import or export by exceeding the scope of license shall be prosecuted for criminal liability according to the provisions on the crime of illegal business operation, or other crimes under the Criminal Law. Where such act is not so serious as to be prosecuted for criminal liability, a penalty shall be imposed depending on the circumstances pursuant to the relevant provisions of the Customs Law, or the competent foreign trade department under the State Council shall issue a warning, confiscate illegal income, if any, and impose a fine of not less than one times but not more than three times the illegal income. The competent foreign trade department under the State Council may concurrently suspend, and even revoke, the foreign trade business license.

Article 48 Any act of forging, mutilating, selling or buying a technology import or export license or certificate of registration of the technology import or export contract shall be prosecuted for criminal liability according to the provisions on the crime of illegal business operation, or on the crimes of forging, mutilating, selling or buying official documents, certificates, and seals of state organs under the Criminal Law. Where such act is not so serious as to be prosecuted for criminal liability, a penalty shall be imposed depending on the circumstances pursuant to the relevant provisions of the Customs Law. The competent foreign trade department under the State Council may concurrently revoke the foreign trade business license.

Article 49 Where a technology import or export license is acquired by fraudulent or any other illegal means, the competent foreign trade department under the State Council shall revoke the technology import or export license, and suspend and even revoke the foreign trade business license.

Article 50 Where a technology import or export contract is registered by fraudulent or any other illegal means, the competent foreign trade department under the State Council shall revoke the certificate of registration of the technology import or export contract, and suspend and even revoke the foreign trade business license.

Article 51 Any functionary in charge of technology import and export administration who, in violation of the Regulations, divulges any state secret or trade secret known to him/her shall be prosecuted for criminal liability according to the provisions on the crime of divulging state secrets or infringing trade secrets under the Criminal Law. Where the act is not so serious as to be prosecuted for criminal liability, he/she shall be imposed a disciplinary sanction in accordance with the law.

Article 52 Any functionary in charge of technology import and export administration who abuses his/her official power, ignores his/her duty, or takes advantage of his/her official position to seek or seize financial and property gains from others shall be prosecuted for criminal liability according to the provisions on the crime of abusing official power, ignoring duty, taking a bribe, or any other crime under the Criminal Law. Where the act is not so serious as to be prosecuted for criminal liability, he/she shall be imposed a disciplinary sanction in accordance with the law.

Chapter V Supplementary Provisions

Article 53 Anyone who is dissatisfied with a decision made by the competent foreign trade department under the State Council on a matter of the approval, license, or registration of, or an administrative penalty in respect to, technology import and export, may apply for administrative reconsideration, or institute legal proceedings in a people's court, in accordance with the law.

Article 54 Where the provisions on technology import and export formulated by the State Council before the issuance of the Regulations are not consistent with those of the Regulations, the latter shall prevail.

Article 55 The Regulations shall come into force as of January 1, 2002. The Administrative Regulations of the People's Republic of China on Technology Introduction Contracts issued by the State Council on May 24, 1985 and the Implementing Regulations of the Administrative Regulations of the People's Republic of China on Technology Introduction Contracts approved by the State Council on December 30, 1987 and issued by the Ministry of Foreign Economic Relations and Trade on 20 January 1988 shall be simultaneously repealed.