2011-01-31-KPMG_China-海关将审核部分加工贸易企业内部的ERP系统_4页_372kb

China Customs Update: Customs Review of Processing Trade Enterprises' ERP Systems

Key Regulations and Changes

This summary covers Customs Announcement 2010 No. 93, which builds on Customs Order No. 195 (2010), focusing on strengthening internal controls in processing trade.

• The regulations require processing trade goods to be stored separately from non-processing trade goods, including separate storage locations and accounting records. This aims to enhance compliance and oversight.
• A key shift involves reviewing internal ERP/SAP systems for eligible enterprises (e.g., larger companies or some industries using integrated logistics) to ensure data flows are separate between processing and non-processing trade. This moves customs focus from checking compliance results to verifying internal controls that guarantee compliance.
• Exceptions allow for more flexibility, such as cross-regional storage under certain conditions, but stricter monitoring applies.

Implications for Enterprises

The emphasis on internal controls could lead to increased compliance costs, particularly for small and medium-sized enterprises, which may lack the resources to implement ERP system enhancements. Enterprises should prepare for potential inspections and communicate with local customs to address ambiguities in the regulations.

KPMG's Advice

KPMG recommends that businesses proactively engage with customs, review their ERP systems if handling both trade types, and monitor the impact on factors like cash flow due to potential保证金 requirements. This aligns with broader trends in China's regulatory environment targeting internal controls for better governance.