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Regulations on Techonlogy Import and Export Administration of the People's Republic of China (2002)

Administration of Technology Import

Article 7.   The State encourages import of advanced and appropriate technology.

Article 8.   Import of any technology falling into the provisions of Articles 16 or 17 of the Foreign Trade Law shall be prohibited or restricted.

The competent foreign trade department under the State Council shall, in conjunction with other relevant departments under the State Council, formulate, regulate and publish catalogues 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 the 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 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 thereby 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 conjunction with relevant departments under the State Council, of the application, and make a decision on approval or disapproval within thirty working days from the date 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 an letter of intent for licensing the technology import.

After being granted the letter of intent for licensing the technology import, an import operator may sign a contract for technology import with its overseas counterpart.

Article 14.   After signing a contract for technology import, an import operator shall submit to the competent foreign trade department under the State Council a copy of the contract for technology import and relevant documents to apply for the technology import license.

The competent foreign trade department under the State Council examines the authenticity of the contract for technology import, and makes a decision, within ten working days from the date of receipt of the documents provided for in the preceding provision, on the approval or disapproval of the technology import.

Article 15.   An applicant, when applying to the competent foreign trade department under the State Council according to the provision of Article 11 of these Regulations for technology import, may submit a copy of the technology import contract concluded.

The competent foreign trade department under the State Council shall, according to the provisions of Articles 12 and 14 of these Regulations, examine the authenticity of the application and the technology import contract, and decide, within forty working days from the date of receipt of the documents provided for in the preceding provision, on the approval or disapproval of the technology import.

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

Article 17.   Technologies freely importable shall be subject to the contract registration system. A contract for importing a freely importable technology takes effect from the time when the contract is established according to 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, and the following documents submitted:

(1) an application for registration of the technology import contract;

(2) a copy of the technology import contract; and

(3) any regulatory 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 the technology import contract and issue the certificate of registration of the technology import contract within three working days from the date of receipt of the documents provided for in Article 18 of these Regulations.

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

Article 21.   Where a technology import contract licensed or registered according to the provisions of these Regulations is changed in terms of the main contents thereof, the formalities shall be gone through once again for the license or registration thereof.

Any licensed or registered technology import contract which has terminated shall be submitted with the competent foreign trade department under the State Council for filing.

Article 22.   Where an enterprise with foreign investment is set up in which the foreign party puts in a technology as its investment, the import of the technology shall be examined or registered in accordance with the procedure for examination and approval of the establishment of the 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 the obligation to keep confidential any trade secret they get to know when performing their functions and duties of technology import and export administration.

Article 24.   The technology supplying party to a technology import contract shall ensure that he or it is the legitimate owner of the technology supplied or one who has the right to assign or license the technology.

Where the receiving party to a technology import contract is accused of infringement by a third party for using the technology supplied by the supplying party under the contract, the former shall immediately notify the latter; the latter, upon receipt of the notification, shall assist the former in removing the impediment.

Where the receiving party to a technology import contract infringes another person's lawful rights and interests by using the technology supplied by the supplying party, the supplying party shall bear the liability therefore.

Article 25.   The supplying party to an technology import contract shall ensure the technology it supplies is complete, accurate, effective and capable of achieving the agreed technical object.

Article 26.   The receiving and supplying parties to a technology import contract shall be under the obligation to keep confidential the undisclosed part of the technology the supplying party has supplied within the scope of confidentiality and time limit thereof as agreed in the contract.

Within the time of confidentiality, the obligation of one party to confidentiality shall terminate immediately after the confidential technology is disclosed for reasons not of his or its own.

Article 27.   Within the term of validity of a contract for technology import, 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 supplying and receiving parties thereto may negotiate on the continued use of the technology according to the principle of justice and equity.

Article 29.   A technology import contract shall not contain any of the following restrictive clauses:

(1) requiring the receiving party to accept any additional condition unnecessary for the technology import, including buying any unnecessary technology, raw material, product, equipment or service;

(2) requiring the receiving party to pay exploitation fee for a technology when the term of validity of the patent right in which has expired or the patent right of which has been invalidated, or to undertake other relevant obligations;

(3) restricting the receiving party from improving the technology supplied by the supplying party, or restricting the receiving party from using the improved technology;

(4) restricting the receiving party from obtaining technology similar to that supplied by the supplying party from other sources or from obtaining a competing technology;

(5) unduly restricting the receiving party from purchasing raw material, parts and components, products or equipment from other channels or sources;

(6) unduly restricting the quantity, variety, or sales price of the products the receiving party produces; or

(7) unduly restricting the receiving party from utilizing the channel for exporting products manufactured using the imported technology.