From 13-17 October 2020, the 22nd Session of the Standing Committee of the 13th National People’s Congress deliberated on the third review draft of the Export Control Law (ECL) before its final passage into law on 17 October 2020. The ECL will come into effect on 1 December 2020.
This is the first comprehensive and consolidated export control law in China. Prior to the law’s enactment, export controls were imposed via a series of separate administrative regulations controlling: Dual-use items; military items; nuclear, missile, chemical and biological items; and related technologies. To implement the ECL, existing administrative regulations on export controls may need to be further revised.
The ECL contains five chapters and 49 articles, which include rules on export control policies, control lists, control measures, and legal liabilities for non-compliance. The ECL is similar to the second review draft, although it does depart in a few aspects. The additions include the following:
(1) A controlled item would also include the item’s corresponding data, such as technical information;
(2) Under special circumstances, export operators may apply to the authorities so that they may transact with black-listed importers and end-users that appear on the ECL’s control list. Importers and end users on the control list may also apply to authorities for removal, should the circumstances that led to their listing no longer apply;
(3) Export control authorities will issue industry-specific guidelines to guide export operators in the establishment and improvement of their internal export control compliance systems and operational effectiveness;
(4) Criminal liability (rather than solely administrative liability) may apply to scenarios where prohibited or unlicensed items were exported. These actions will be investigated in accordance with criminal laws, should they constitute a crime; and
(5) The new ECL also stipulates that should any country or region abuse export control measures to endanger the national security and interests of China, then China may, based on actual conditions, take reciprocal measures against that country or region.
Business Law Digest is compiled with the assistance of Baker McKenzie. Readers should not act on this information without seeking professional legal advice. You can contact Baker McKenzie by e-mailing Danian Zhang (Shanghai) at firstname.lastname@example.org