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REGULATIONS ON QUALITY RESPONSIBILITY FOR INDUSTRIAL PRODUCTS (NOTE1)

Category  TECHNOLOGICAL CONTROL Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1986-04-05 Effective Date  1986-07-01  

Regulations on Quality Responsibility for Industrial Products (Note1)



Chapter I  General Provisions
Chapter II  Quality Responsibility of the Product Manufacturer
Chapter III  Quality Responsibility of Enterprises for Storing or
Chapter IV  Quality Responsibility of the Marketing Firm of the Product
Chapter V  Supervision and Control over the Quality of Product
Chapter VI  Settlement of Disputes over Quality Responsibility for the
Chapter VII  Penalties
Chapter VIII  Supplementary Provisions
Note:

(Promulgated by the State Council on April 5, 1986)

Chapter I  General Provisions

    Article 1  The present Regulations are enacted in order to define the
quality responsibility for industrial products ("products" for short
hereinafter), safeguard the legitimate right of the customer and consumer
("customer" for short hereinafter), ensure the healthy development of
commodity economy in a planned way, and promote socialist modernization.

    Article 2  "Quality of product" refers to the requirement for the
applications, safety and other properties of the products stipulated in
related laws and regulations, quality standards and contracts.

    "Quality responsibility for products" refers to the responsibility that
shall be born due to the product's failure to satisfy the above-mentioned
requirements, which leads to loss on the part of the customer.

    Article 3  The national standardization department is responsible for
drawing up the unified national standards. The national standards shall not
be lower than the international standards.

    National standards may be classified and graded. The competent
authorities responsible for the enterprise shall fix a time limit for
achieving the highest grade of the national standards. The price department
of the Central Government shall fix the prices according to the grades of
standards and implement the principle of "price according to quality".

    Article 4  Those enterprises engaging in the production, storing,
transporting and marketing of the product must, in accordance with the
stipulations of the present Regulations, undertake the quality responsibility
for the products.

    The various departments, various localities, especially the competent
authorities for the manufacturer must exercise strict control over the
quality of the products, supervise and see that the manufacturer concerned
abides by the principle of "quality first", with a view to guaranteeing the
quality of product and undertaking quality responsibility. Those failing to
exercise effective control and supervision shall also undertake liability
arising therefrom.

    Article 5  Quality-supervision agencies and the industry and commerce
administration departments must keep supervision over the quality of product
and protect the interest of the customer.

    Article 6  The quality certificate, manuals, "high-quality" sign and
identity sign of a product must all be in conformity with the actual quality
level of the product.

    The explanation in the advertisement of the product must conform to the
actual quality of the product.

    Article 7  All the manufacturers and the marketing firms must observe
strictly the following rules:

    (1) un-qualified product is forbidden from being dispatched from the
factory or marketed;

    (2) un-qualified raw materials and parts and components are not allowed
to be put into production or be used for assembly;

    (3) it is forbidden to manufacture the products whose elimination the
State has explicity ordered;

    (4) product without the product-quality standard or without being tested
by the state quality-testing organ is not allowed to be manufactured and
marketed;

    (5) it is forbidden to plot frauds, to pass of un-qualified product as
qualified, to forge trademarks, or to imitate the famous brand products.

    All the manufacturers and marketing firms are not allowed to sell their
products by way of coupling-sale.
Chapter II  Quality Responsibility of the Product Manufacturer

    Article 8  The manufacturer of the product must make sure that the
quality of the product conforms to the requirements laid down by relevant
laws and regulations. quality standards and stipulations of the contract.

    The manufacturer of the product must set up a strict, well-coordinated
and effective quality-guarantee system, with a view to fixing the quality
responsibility for the product in an explicit manner.

    The manufacturer must see to it that the quality-inspecting organ can
independently perform its functions of supervision and testing. It is
strictly forbidden to retaliate against the quality inspectors.

    Article 9  The product shall not leave the factory unless it satisfies
the following requirements:

    (1) achieving the quality requirements stipulated in Article 2 of the
present Regulations, and obtaining the quality certificate of the product
issued by testing organ and testing personnel;

    (2) having the written explanation of, according to specific
characteristics, the product's name, size, model, ingredients, the percentage
of the ingredients, weight, direction for applications, lot No. of production,
date of production, name of manufacturer, address of the manufacturer, and
the serial number of the technical specifications of the said product;
explicitly specifying the date of expiry in case of a product with time
limit of efficacy. "High quality" product must bear the mark thereof;

    (3) having the serial number, date of approval and the term of validity
of the production licence in case of a product manufactured under the
production licence system;

    (4) machinery, equipment, devices, apparatus and durable consumer goods,
apart from satisfying the requirements in Items (1), (2) and (3) of this
Article, shall be accompanied with detailed instructions on the use of the
product. The content thereof includes: the product's technical-economic
parameters, service life, range of application, term of guarantee, methods for
installation, methods of maintenance and conditions for storing, term of
technical maintenance and repair, and other effective data concerning the
design parameters of the product. Electric products shall be attached with
the circuit diagram and schematic diagram;

    (5) the package must conform to the related state regulations and
standards. As regards the products that are drastically poisonous, dangerous,
fragile, can not be laid on by heavy load, needing protection against
moisture, can not be turned upside down, there must be, on both the external
and interior packing, obvious indication marks and notices for storing and
transportation. On the package of the product, there must be noted explicity
the actual weights (net and gross);

    (6) on the product or the package thereof on which the trademark and
quality classification and grading system is applied, there shall be signs
for the said trademark, classification and grading;

    (7) conforming to the requirements of the state laws and regulations
concerning safety, hygiene, protection of environment and measuring.

    Article 10  The "substandard" goods that fail to achieve the requirements
of the related state standards, but still have some use value, cannot be
marketed at reduced price until having obtained the approval from the
competent authorities of the manufacturer; and on the package there must be
clearly marked with the words of "substandard goods".

    Products that fail to meet the requirements of the state laws and
regulations concerning safety, hygiene and environmental protection and
measuring must be destroyed or undergo necessary technical treatment in good
time. They are not allowed to enter the market in the name of "substandard
goods".

    "Substandard goods" are not allowed to be used to manufacture or assemble
market-oriented products.

    Article 11  Within the guarantee period of the product, in case of the
quality found out of line with the requirements stipulated in Article 2,
the manufacturer shall, according to the following different circumstances,
undertake the quality liability to the customer and marketing firm:

    (1) the common part or component loses efficacy and therefore, after
being replaced, the performance can immediately be restored; in this case,
the manufacturer shall be responsible for replacing with qualified parts or
components and for restoring the normal performance;

    (2) in case that the main part or competent of the product has lost the
efficacy and cannot be repaired within the set period, the manufacturer
shall be responsible for replacing with qualified products;

    (3) in case the major function fails to satisfy the requirements of
Article 2 due to such causes as designing and manufacture, if the customer
requires to return the goods, the manufacturer shall refund;

    (4) in case of economic loss caused by the quality faults, the
manufacturer shall also compensate for the actual loss;

    (5) if maintenance and repair service or marketing firm responsible for
the aftersale technical service, so required and manufacturer must, according
to the contract of after-sale service, supply sufficient standby products,
spare parts and necessary technical support.
Chapter III  Quality Responsibility of Enterprises for Storing or
Transporting the Product

    Article 12  The enterprises which undertake to store, transport, load
or unload the products must conduct the work of the storing, transportation,
loading and unloading in compliance with the relevant state stipulations
and the storing-transporting requirements indicated on the package of the
product.

    Article 13  In the course of the product entering the warehouse for
storing or leaving the warehouse, undertaking to transport the product or
handing over the product, the enterprise that stores or transports the
product shall observe the pertinent state stipulations and the
storing-trans-system of handing-over and checking before acceptance, so as
to define the quality responsibility. In case it has been testified that
the damage of the product is due to the cause of storage, transport of
loading and unloading, the enterprises which store, transport or load and
unload the product shall bear their respective liabilities and, according
to related government regulations, compensate for the economic loss.
Chapter IV  Quality Responsibility of the Marketing Firm of the Product

    Article 14  When laying in a stock of merchandise, the marketing firm
shall, before acceptance, test the product, so that the quality responsibility
can be clearly defined. The products sold by the marketing firm must conform
to the requirements stipulated in Articles 7 and 9 of the present Regulations.

    Article 15  In case the product sold by the marketing firm is found not
up to the conditions stipulated in Article 2 within the period of guarantee,
the marketing firm shall be responsible for guaranteed repairing, replacement,
taking back the product and refunding, and undertaking the responsibility of
compensating for the actual economic loss.
Chapter V  Supervision and Control over the Quality of Product

    Article 16  The various quality-supervising agencies shall, in accordance
with the relevant regulations of the state, organize independently, or
together with the industry and commerce administrative authorities, the
responsible departments of the various trades, and the responsible departments
of the various manufacturers, regular supervisional sample-checking on the
various links such as manufacture, storing, transportation, and marketing, and
regularly publicize the result of the testing of the samples. Enterprises must
honestly furnish the samples for checking and provide facilities with respect
to the testing means and working conditions.

    Unless otherwise stated in state regulations, it is not allowed for the
quality-supervising agencies to collect fees from the enterprises for
sample-checking on the product, so as to guarantee the impartiality of the
supervising agencies. The expenses needed for the technical means and measures
and for the test by the quality-supervising agencies shall be covered by the
state or local financial allocations according to the actual needs. The
economic commission at various levels are responsible for leadership,
organization and coordination of the supervision and control over product
quality.

    Article 17  Responsible departments of the trades and responsible
departments for the enterprises at various levels are responsible for the
control over the quality of products in the respective trades within their
authoritization, which covers: formulating or taking part in the formulation
of the quality standards for the products in their respective areas of
responsibility and the pertinent rules and regulations, being responsible
for supervision and control over the quality of products, urging the
enterprises to ensure the quality of product, perfecting the quality
guaranteeing system, and organizing the issuance of production licences.

    Article 18  Exercise social supervision over the quality of product.
The customer can make inquiries about the quality of the product at the
manufacturer, the enterprises for storing and transporting, and the marketing
firms; and the social associations and organizations can help the customers
participate in the mediation, arbitration over quality disputes, and support
the customers to file lawsuits with the people's court.

    Article 19  The customer can, according to the mutual agreement between
the customer and manufacturer, send his representative to the manufacturer
to conduct on-the-spot-supervision over the process of the production and the
quality of the product.
Chapter VI  Settlement of Disputes over Quality Responsibility for the
Product

    Article 20  Any dispute arising from the quality of product shall,
provided there is an economic contract, observe the relevant stipulations in
the Economic Contract Law. In the absence of such contracts, either party to
the dispute can refer the dispute to a relevant quality-supervising agency for
mediation or settlement, or take the case to the people's court.

    Article 21  In case of any dispute over the data of technical testing
of the quality of product, the party concerned or the mediating or arbitrating
agencies can entrust legally designated quality-testing unit for arbitral
testing; and the said quality testing unit shall be responsible for the data
of the arbitral testing.

    Article 22  Unless otherwise stipulated by the government, the request
for arbitration or prosecution over quality responsibility shall be raised
within one year from the date the party concerned is aware of or should be
aware of his interest and rights being damaged. Where the party bearing the
quality responsibility for the product is willing to bear the responsibility,
it is not limited by the term of validity.
Chapter VII  Penalties

    Article 23  Where the product of an enterprise fails to reach the
state-stipulated standards, the competent authoritative department of the
said enterprise shall order the enterprise to rectify production within a
fixed period. Where the said rectification within the fixed period turns out
to be of no effect, the competent authoritative department of the said
enterprise shall order it to stop production or switch over to a new line
of products, or even suggest that the relevant authorities revoke the
production licence and the business licence. In the period of rectification,
the competent authoritative department responsible for the said enterprise
may, according to different circumstances, deduct the bonus and wages of the
executive members of the enterprise and of the staff and workers.

    Article 24  Where the manufacturer or marketing firm has committed one
of the following acts in violation of the stipulations of the present
Regulations, the authoritative department responsible for the enterprise or
firm shall mete out disciplinary punishment to the responsible persons of the
enterprise and to the persons bearing direct responsibility; and the industry
and commerce administrative organ shall confiscate all the illegal income,
and impose on it a fine equivalent to 15% to 20% of the illegal income
according to the degree of seriousness of the case; or even the legal
liabilities shall be fixed by the judicial organs through due investigation.

    1. manufacture or market adulterated product or imitated product, or
pass off "substandard" product as qualified;

    2. manufacture or market products without indicating the name and address
of the manufacturer;

    3. manufacture or market products without quality certificate;

    4. manufacture or market products of which the State has issued explicit
order for their elimination;

    5. manufacture or market the products on which the State adopts the
system of production licence, but fails to renew the said production licence
after its expiry;

    6. manufacture or market products manufactured or assembled with
un-qualified raw materials, parts or components;

    7. manufacture or market products in violation of the requirements
stipulated by state laws and regulations concerning safety, hygiene,
environmental protection and measuring;

    8. market products which have passed the expiry date.

    The incomes collected from fines shall be handed to the state treasury.

    Article 25  In the course of sample-check on quality supervision, in case
it is found that the manufacturer or marketing firm has committed the
act(s) listed in Article 24, the quality-supervising agency shall treat the
case according to the stipulation in Article 24. As regards the product not
in conformity to the provision of Item (7) of Article 9 of the present
Regulations, the product shall be destroyed on the spot by the quality-
supervising agency or be given the necessary technical treatment; and the
manufacturer and the marketing firm shall be ordered to recover within the
given time all the substandard products that have already been sold.

    In case of violation of the stipulations in Article 8 of the present
Regulations, or retaliation against quality-testing personnel, or the working
personnel in quality-supervising and quality-testing agencies act wrongly out
of personal consideration, the responsible authoritative department shall mete
out disciplinary punishment. As regards those of extraordinary seriousness,
criminal liabilities shall be investigated and fixed according to law.

    Article 26  Where the poor quality of the product has resulted in the
injury or death of the customer, and in his loss of property, hence violating
the criminal code, the judicial organs shall investigate and fix the legal
liability of the party concerned.

    Article 27  The above-mentioned penalty does not acquit the party
bearing the quality responsibility of its responsibility for the guaranteed
repair, replacement, recovering the product with the money already paid, and
the compensation for the actual economic loss to the customer(s).
Chapter VIII  Supplementary Provisions

    Article 28  The relevant responsible authorities may, in line with the
provisions of the present Regulations, work out the implementing details.
The quality responsibility regulations for import & export products, for
goods with military application as well as goods for special requirements,
the relevant authorities may, with reference to the principles of the present
Regulations, enact separate specific regulations.

    Article 29  The present Regulations apply to all enterprises with
ownership by the whole people, enterprises with ownership by the collective,
individual industrial and commercial operators as well as the Chinese-foreign
equity joint ventures, contractual joint ventures, and foreign-capital
enterprises.

    Article 30  The State Economic Commission is authorized to interpret
the present Regulations.

    Article 31  The present Regulations shall go into force on July 1, 1986.
Note:

    Note 1  In case of discrepancy between these Regulations and the Law of
the People's Republic of China on Product Quality promulgated by Order No.71
of the President of the People's Republic of China on February 22, 1993,
the latter shall prevail. --The Editor



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