Article 39 Duty reduction or exemption shall be granted for import or export goods and inward or outward articles listed below：
（1） advertising items and trade samples of no commercial value；
（2） materials presented free of charge by foreign governments or international organizations；
（3） goods to which damage or loss has occurred prior to Customs release；
（4） articles of a quantity or value within the fixed limit；
（5） other goods and articles specified by law as items for duty reduction or exemption； and
（6） goods and articles specified as items for duty reduction or exemption by international treaties to which the People's Republic of China is either a contracting or an acceding party.
Article 40 Duty reduction or exemption may be granted for import and export goods of the Special Economic Zones and other specially designated areas； for import and export goods of specific enterprises such as Chinese-foreign equity joint ventures， Chinese-foreign contractual joint ventures and enterprises with exclusive foreign investment； for import and export goods devoted to specific purposes； and for materials donated for use by public welfare undertakings. The State Council shall define the scope and formulate the rules for such reduction and exemption. The State Council or departments empowered by the State Council shall define the scope and formulate the rules for duty reduction or exemption involved in small volumes of border transactions.
Article 41 All import goods and articles for which duty reduction or exemption is granted in accordance with the preceding Article shall be used only in specific areas and enterprises or for specific purposes. They shall not be utilized otherwise unless Customs approval is obtained and duties duly paid.
Article 42 Temporary duty reduction or exemption not specified in Articles 39 and 40 of this Law shall be examined and approved by the General Customs Administration independently or jointly with the financial department under the State Council in accordance with the regulations of the State Council.
Article 43 Temporary duty exemption shall be granted for goods approved by the Customs as temporarily imported or exported items and for bonded goods imported by special permission after the consignee or the consignor of the goods submits to the Customs a guarantee or a deposit of an amount equal to the duties.
Article 44 Where the Customs finds that the duties are short-levied or not levied on a consignment of import or export goods or on an inward or outward article after its release， the Customs shall collect the money payable from the obligatory Customs duty payer within one year of the previous duty payment or the release of the item. If the short-levied or non-levied duties are attributable to the duty payer's violation of the Customs regulations， the Customs may collect the unpaid amount from him within three years.
Article 45 Where the duties are over-levied， the Customs， upon discovery， shall refund the money without delay. The duty payer may ask the Customs for refunding within one year of the date of duty payment.
Article 46 Where the obligatory Customs duty payer is involved in a dispute over duty payment with the Customs， he shall first pay the duties and may， within 30 days of the issuance of the duty memorandum， apply to the Customs in writing for a reconsideration of the case. The Customs shall reach a decision within 15 days of the receipt of the application. If the obligatory customs duty payer refuses to accept the decision， he may apply to the General Customs Administration for a reconsideration of the case within 15 days of the receipt of the decision. If the decision of the General Customs Administration is still considered unacceptable by the obligatory customs duty payer， he may file a suit in a people's court within 15 days of the receipt of the decision.
Chapter VI Legal Responsibility
Article 47 Evasion of Customs control in one of the forms listed below shall constitute a crime of smuggling：
（1） to transport， carry or send by post into or out of the territory narcotic drugs， weapons or counterfeit currencies which are prohibited by the State from being imported or exported； to transport， carry or send by post into or out of the territory obscene objects for the purpose of profit-making or dissemination； or to transport， carry or send by post out of the territory cultural relics which are prohibited by the State from being exported；
（2） to transport， carry or send by post into or out of the territory， for the purpose of making a profit， articles in relatively large quantities or of a relatively high value which are prohibited by the State from being imported or exported， but which are not included in Item （1） of this Article； and goods or articles in relatively large quantities or of a relatively high value whose importation or exportation is restricted by the State or which are subject to the collection of Customs duties according to law； or
（3） to sell， without Customs approval and payment of duties， bonded goods imported by special permission or goods listed for special duty reduction or exemption which are in relatively large quantities or of a relatively high value. Any armed smuggling or resistance by violence to Customs examination of smuggled goods or articles shall constitute a crime of smuggling， whatever the quantity or value of the goods or articles involved. The criminal punishments imposed by the people's court to persons guilty of smuggling include imposing a fine and the confiscation of the smuggled goods or articles， of the means of transport used for smuggling and of the illegal proceeds obtained therefrom. Where an enterprise， an institution or a state organ or a public organization is guilty of smuggling， the judicial organ shall investigate and determine the criminal responsibility of the person or persons in charge and the person or persons directly answerable for the offence， and issue an order to impose a fine on the unit and confiscate the smuggled goods or articles， the means of transport used for smuggling and the illegal proceeds obtained therefrom.
Article 48 If the smuggled goods and articles involved in one of the acts listed under Items （2） and （3） of Article 47 of this Law are not large in quantity nor of high value， or where the carrying or sending by post of obscene objects into or out of the territory does not yet constitute a crime of smuggling， the Customs may， while confiscating the goods， articles or illegal proceeds obtained therefrom， concurrently impose a fine on the person or persons concerned.
Article 49 Any of the following acts shall be dealt with as a crime of smuggling and shall be punishable in accordance with the provisions of Article 47 of this Law：
（1） to purchase directly and illegally from a smuggler articles which are prohibited by the State from being imported； or to purchase directly and illegally from a smuggler other smuggled goods or articles in relatively large quantities or of a relatively high value； or
（2） to transport， purchase or sell on inland or territorial waters articles which are prohibited by the State from being imported or exported； or to transport， purchase or sell without legal certification goods or articles whose importation or exportation is restricted by the State and which are in relatively large quantities or of a relatively high value.
Where an act listed in the preceding paragraphs does not yet constitute a crime of smuggling， punishment shall be applied in accordance with the provisions of Article 48 of this Law.
Article 50 Any individual who carries or sends by post articles for personal use into or out of the territory in a quantity exceeding the reasonable limit and fails to declare them to the Customs shall be made to pay the duties and may be fined.
Article 51 A fine may be imposed for any of the following acts which violate the regulations on Customs control prescribed in this Law：
（1） for a means of transport to enter or leave the territory at a place without a Customs establishment；
（2） to fail to inform the Customs of the arrival and departure time of a means of transport and the place where it will stay or any change of such a place；
（3） to fail to declare truthfully to the Customs the import or export goods or the transit， transshipment and through goods；
（4） to fail to accept， in accordance with relevant regulations， the checking and examination by the Customs of the means of transport， goods or articles entering or leaving the territory；
（5） for an inward or outward means of transport to load or unload inward or outward goods or articles or let passengers get on or off without Customs approval；
（6） for an inward or outward means of transport staying at a place with a Customs establishment to leave without Customs approval；
（7） for an inward or outward means of transport en route from one place with a Customs establishment to another with a Customs establishment to move out of the territory or to a point in the territory where there is no Customs establishment without completing the clearance formalities and obtaining Customs approval；
（8） for an inward or outward means of transport to engage concurrently in or change to service within the territory without Customs approval；
（9） for an inward or outward vessel or aircraft which， by force majeure， stops or lands at a place without a Customs establishment， or jettisons or discharges goods or articles in the territory to fail unjustifiably to report to the Customs authorities nearby；
（10） to open， pick up， deliver， forward， change， repack， mortgage or transfer goods under Customs control without Customs approval；
（11） to open or break seals affixed by the Customs without authorization； or
（12） to violate other provisions specified in this Law concerning Customs control so that the Customs cannot exercise or has to suspend control over inward and outward means of transport， goods or articles.
Article 52 The smuggled goods and articles， illegal incomes and means of transport used for smuggling which are confiscated and the fines which are imposed by order of the people's court shall all be turned over to the State Treasury， and so shall be the smuggled goods and articles and illegal incomes which are confiscated and the fines which are imposed by decision of the Customs. It is the responsibility of the Customs to handle all smuggled goods and articles and the means of transport used for smuggling which are confiscated by order of the people's court or by decision of the Customs and to turn them over to the State Treasury in accordance with the regulations of the State Council.
Article 53 If the party concerned objects to the Customs decision of punishment， he may hand in an application for a reconsideration of the case， either to the Customs establishment making the decision or to one at the next higher level within 30 days of the receipt of the notification on punishment or， in case notification is impossible， within 30 days of the public announcement of punishment. If the party concerned finds the decision reached after reconsideration still unacceptable， he may file a suit in a people's court within 30 days of the receipt of the decision. The party concerned may also file a suit directly in a people's court within 30 days of the receipt of the notification on punishment or within 30 days of the public announcement of the punishment. If the party concerned refuses to carry out the Customs decision and fails to apply for a reconsideration of the case or file a suit in a people's court within the prescribed time limit， the Customs establishment making the decision of punishment may confiscate the deposit of the party concerned or sell off the goods， articles or means of transport it has detained to substitute for he penalty， or ask the people's court for mandatory execution of the decision.
Article 54 If the Customs causes damage to any inward and outward goods or articles while examining them， it shall make up for the actual loss from such damage.
Article 55 The criminal responsibility of any Customs personnel who divide up confiscated smuggled goods or articles among themselves shall be investigated and determined in accordance with Article 155 of the Criminal Law of the People's Republic of China. No Customs personnel shall be allowed to purchase confiscated smuggled goods or articles. Those who have done so shall be made to return the goods or articles， and may be given a disciplinary sanction.
Article 56 Any Customs personnel who abuse their powers and intentionally create difficulties in or procrastinate the control and examination process shall be given a disciplinary sanction. Those who act illegally for personal gains， neglect their duties or connive at smuggling shall be given a disciplinary sanction or investigated for criminal responsibility in accordance with the law， depending on the seriousness of the case.
Chapter VII Supplementary Provisions
Article 57 Terms used in this Law are defined as follows：
The term “inward and outward means of transport” means various types of vessels， vehicles， aircraft and pack-animals which enter or leave the territory carrying persons， goods or articles.
The term “transit， transshipment and through goods” means goods which come from a place outside the territory and pass through the territory en route to a place outside the territory. Among them， “transit goods” are those which pass through the territory by land， “transshipment goods” are those which do not pass through the territory by land but are loaded on a different means of transport at a place with a Customs establishment， and “through goods” are those which are carried into and out of the territory by the same vessel or aircraft.
The term “goods under Customs control” means import and export goods and transit goods， transshipment goods and through goods listed under Article 17 of this Law， temporarily imported and exported goods， bonded goods and other inward and outward goods for which Customs formalities have not been completed.
The term “bonded goods” means goods which have entered the territory by approval of the Customs as items for which no formalities have been performed in the way of duty payment and which will be reshipped out of the territory after being stored， processed or assembled in the territory. The term “Customs surveillance zone” means any seaport， railway or highway station， airport， border pass or international postal matter exchange station where there is a Customs establishment， any other place where Customs control is exercised， and any place without a Customs establishment which has been approved by the State Council as a point of entry into and exit from the territory.
Article 58 The Customs shall reward units or individuals for meritorious service in providing information or assistance which leads to the discovery and seizure of offenders against this Law. It shall keep the identities of such units or individuals strictly confidential.
Article 59 The State Council shall draw up rules governing control over the means of transport， goods and articles going between the Special Economic Zones and other specially designated areas and other parts of the territory.
Article 60 The General Customs Administration shall， pursuant to this Law， formulate rules of implementation to be reported to the State Council for approval before they come into force.
Article 61 This Law shall go into effect as of July 1， 1987. The Provisional Customs Law of the People's Republic of China promulgated by the Central People's Government on April 18， 1951， shall be annulled therefrom.