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REGULATIONS ON THE ADMINISTRATION OF TOURIST AGENCIES

Category  TOURISM Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1996-10-15 Effective Date  1996-10-15  

Regulations on the Administration of Tourist Agencies



Chapter I  General Provisions
Chapter II  Establishment of Tourist Agencies
Chapter III  Management of Tourist Agencies
Chapter IV  Supervision and Inspection
Chapter V  Penalty
Chapter VI  Supplementary Provisions

(Promulgated by Decree No.205 of the State Council of the People's

Republic of China on October 15, 1996)
Chapter I  General Provisions

    Article 1  These Regulations are formulated to strengthen the
administration of tourist agencies, to safeguard lawful rights and interests
of tourists and tourist agencies, to maintain the order in the tourist market
and to promote the healthy development of the tourist industry.

    Article 2  These Regulations are applicable to tourist agencies
established within the territory of the People's Republic of China and to
resident offices established by foreign tourist agencies within the territory
of the People's Republic of China (hereinafter referred to as "resident
offices of foreign tourist agencies").

    Article 3  Tourist agencies mentioned in these Regulations refer to those
enterprises engaged in tourist business for profit.

    Tourist business mentioned in these Regulations refers to the non-gratis
services and operational activities which include completing entry, departure
and visa formalities on behalf of tourists, soliciting and receiving tourists,
and making arrangements for their meals and accommodation.

    Article 4  The tourism administration department under the State Council
shall be responsible for the supervision and management of tourist agencies in
the whole country.

    Departments in charge of tourism of local people's governments at or above
the county level shall, according to their functions, be responsible for the
supervision and management of tourist agencies within their administrative
areas.

    The departments prescribed in the first and second paragraphs in this
Article are generally referred to as tourism administration departments.

    Article 5  Tourist agencies shall be divided into international tourist
agencies and domestic tourist agencies according to the scope of their
business.

    The scope of business for international tourist agencies shall include
entry tourist services, exit tourist services and domestic tourist services.

    The scope of business for domestic tourist agencies shall be limited to
domestic tourist services.
Chapter II  Establishment of Tourist Agencies

    Article 6  The following prerequisites shall be fulfilled for the
establishment of a tourist agency:

    (1) having a fixed site for business;

    (2) having facilities necessary for business;

    (3) having trained operational personnel with a qualification certificate
issued by the tourism administration departments of people's governments of
provinces autonomous regions or municipalities directly under the Central
Government; and

    (4) having a registered capital and a quality guarantee deposit as
stipulated in Articles 7 and 8 of these Regulations.

    Article 7  The registered capital of a tourist agency shall meet the
following requirements:

    (1) For an international tourist agency, the registered capital shall be
no less than RMB 1,500,000 yuan;

    (2) For a domestic tourist agency, the registered capital shall be no less
than RMB 300,000 yuan.

    Article 8  Anyone who applies for the establishment of a tourist agency
shall pay a quality guarantee deposit to the tourism administration department
in accordance with the following standards:

    (1) An international tourist agency shall pay RMB 600,000 yuan for
engaging in entry tourist business and shall pay RMB 1,000,000 yuan for
engaging in exit tourist business.

    (2) A domestic tourist agency shall pay RMB 100,000 yuan.

    The quality guarantee deposit and interest derived therefrom during the
period when it is under the control of the tourism administration department
shall belong to the tourist agency. The tourism administration department may,
according to relevant state provisions, take a portion of the interest as
costs of administration.

    Article 9  Anyone who wishes to establish an international tourist agency
shall submit an application to the department in charge of tourism of the
people's government of the province, autonomous region or municipality
directly under the Central Government where his tourist agency is located.
Upon the examination and approval of the very department, the application
shall be transmitted to the tourism administration department under the State
Council for verification and approval.

    Anyone who wishes to establish a domestic tourist agency shall submit an
application to the department in charge of tourism of the people's government
of the province, autonomous region or municipality directly under the Central
Government for approval.

    Article 10  Anyone who applies for the establishment of a tourist agency
shall submit the following documents:

    (1) a written application for establishment;

    (2) a feasibility study report for the establishment of the tourist agency;

    (3) articles of association of the tourist agency;

    (4) the curriculum vitaes of the manager and deputy managers of the
tourist agency and qualification certificates prescribed in Item (3) of
Article 6 of these Regulations;

    (5) a credit certificate provided by the bank where it has opened an
account and an asset verification report provided by a certified public
account and his public accountants' office or auditors' office;

    (6) a certificate for the site of business; and

    (7) a certificate for situation of facilities used in business.

    Article 11  After receiving the application, the tourism administration
department shall verify it according to the following principles:

    (1) It shall conform to the development planning for tourist industry;

    (2) It shall meet the demand of tourist market; and

    (3) It shall fulfil the prerequisites prescribed in Article 6 of these
Regulations.

    The tourism administration department shall, within 30 days from the date
of receiving the application, make its decision of approval or not approval
and notify the applicant.

    Article 12  The tourism administration department shall issue a Tourist
Agency Permit for Tourist Business to the person whose application has been
verified and approved. The person shall apply to the industry and commerce
administrative department for a business licence on the strength of the permit.

    No one may engage in tourist business without the Tourist Agency Permit
for Tourist Business.

    Article 13  A tourist agency that intends to change its scope of business
shall, subject to the verification and approval of the tourism administration
department that verified and approved its establishment, register the change
with the industry and commerce administrative department.

    A tourist agency that intends to change its name, site of business, or
legal representative, or to suspend its operations or close down shall go
through the corresponding procedures for registering the change or cancelling
its registration with the industry and commerce administrative department, and
then submit the case to the tourism administration department that verified
and approved its establishment for the record.

    Article 14  The tourism administration department shall practise an
announcement system governing tourist agencies, including announcements
concerning opening for business, change of name, change of business scope,
suspension of operations and revocation of permit.

    Article 15  A tourist agency that receives more than 100,000 tourists a
year may set up a branch without the status of legal person (hereinafter
referred to as "branch").

    For each branch it sets up, an international tourist agency shall increase
its registered capital by RMB 750,000 yuan and its quality guarantee deposit
by RMB 300,000 yuan. For each branch it sets up, a domestic tourist agency
shall increase its registered capital by RMB 150,000 yuan and its quality
guarantee deposit by RMB 50,000 yuan.

    A tourist agency shall practise unified management, unified accounting and
unified solicitation and acceptance of tourists together with its branch.

    branches set up by tourist agencies shall put themselves under the
supervision and control of the tourism administration departments of local
people's governments at or above the county level in the places where they are
located.

    Article 16  Anyone who applies for the establishment of a tourist agency
with joint investment or to be jointly operated by Chinese and foreign sides
shall, subject to the approval of his application according to the provisions
set by the State Council, go through procedures as required by relevant laws
and administrative regulations.

    Article 17  A foreign tourist agency that wishes to set up a resident
office within the territory of the People's Republic of China shall apply to
the tourism administration department under the State Council for approval.

    Any resident office of foreign tourist agencies may only engage in tourist
consultation, liaison and publicity but may not engage in tourist business.
Chapter III  Management of Tourist Agencies

    Article 18  A tourist agency shall conduct business operations within the
scope as verified and approved.

    A tourist agency shall comply with the principles of voluntariness,
equality, fairness, honesty and credibility as well as business ethics in
conducting business operations.

    Article 19  Any tourist agency may not resort to the following unfair
means to engage in tourist business and cause damage to its competitors:

    (1) passing off a registered trademark of another tourist agency;

    (2) using a name of another tourist agency without authorization;

    (3) defaming other tourist agencies;

    (4) entrusting a unit or individual without the status of a tourist agency
to conduct tourist business; or

    (5) committing other actions that disturb the order in the tourist market.

    Article 20  A tourist agency shall conclude written contracts with
operational personnel it employs to agree upon rights and obligations of the
two sides.

    Operational personnel shall not, without authorization of the tourist
agency, disclose, use or allow others to use business secrets of the tourist
agency possessed by him.

    Article 21  A tourist agency shall safeguard lawful rights and interests
of tourists.

    A tourist agency shall provide tourists with truthful and reliable
information concerning tourist services and shall not make false publicity.

    Article 22  A tourist agency shall, when organizing a tour, effect tourist
accident insurance on behalf of the tourists and shall guarantee that its
services will be provided according to the requirements for safeguarding the
security of tourists and their belongings. It shall give the tourists truthful
explanations and definite warnings concerning matters that may endanger the
security of tourists and their belongings and shall take measures to prevent
the damage.

    Article 23  A tourist agency shall charge tourists for its tourist
services in accordance with the state provisions. Extra charges for additional
service items during a tour shall be subject to the consent of the tourists.

    For each item of paid-services, the tourist agency shall, according to
relevant state provisions, offer a service document to the tourists.

    Article 24  Tourists shall have the right to lodge complaints to the
tourism administration department in any of the following cases where they
suffer losses:

    (1) The tourist agency fails to attain the service quality standard as
agreed upon in the contract due to its own fault;

    (2) The tourist agency fails to provide services up to the national
standard or trade standard; or

    (3) The tourist agency causes loss of travelling expenses paid in advance
by tourists due to its bankruptcy.

    The tourism administration department shall accept and handle complaints
from tourists in accordance with the provisions of these Regulations.

    Article 25  Tourist guides and tourist leaders engaged by a tourist agency
for accepting tourists or organizing oversea tours shall possess qualification
certificates issued by a tourism administration department of people's
governments at or above the level of a province, autonomous region or
municipality directly under the Central Government.

    Article 26  When organizing oversea tours, the tourist agency shall select
tourist agencies lawfully established and enjoying good reputation in the
country or region concerned, and shall conclude written agreements with them
before entrusting them to accept tourists.

    If the breach of agreement by an oversea tourist agency causes losses to
the rights and interests of tourists, the domestic tourist agency organizing
the oversea tour shall bear the responsibility for compensation before seeking
reimbursement from the breaching oversea tourist agency.

    Article 27  A tourist agency shall, when soliciting and accepting
tourists, make complete records and keep relevant documents and materials for
the inspection by the tourism administration department.
Chapter IV  Supervision and Inspection

    Article 28  The tourism administration departments shall, according to
law, strengthen the supervision and control over tourist agencies and resident
offices of foreign agencies in order to maintain the order of tourist market.

    Article 29  Tourist agencies shall subject themselves to the supervision
and inspection by the tourism administration departments over their business
operations in such aspects as service quality, tourist security, price
offering, financial accounts and foreign exchange receipts and payments.

    Personnel of the tourism administration departments shall show their
certificates when performing their duties of supervision and inspection.

    Article 30  The tourism administration departments shall conduct an annual
inspection each year over every tourist agency. Tourist agencies inspected
shall, as required by the tourism administration departments, provide an
annual inspection report, statement of assets, financial statement and other
relevant documents and materials.

    Article 31  The tourism administration departments shall make strict
control over the quality guarantee deposit and shall use the deposit for the
compensation for economic losses of tourists according to relevant state
provisions. No unit and individual may embezzle the quality guarantee deposit.
Chapter V  Penalty

    Article 32  If anyone violates the provisions of the second paragraph of
Article 12 and the second paragraph of Article 17 of these Regulations, the
tourism administration department shall order him to stop unlawful business
operations, confiscate his unlawful earnings and concurrently impose a fine
from RMB 10,000 yuan to RMB 50,000 yuan.

    Article 33  If anyone violates the provisions of the first paragraph of
Article 18, Article 22, the first paragraph of Article 23, Article 25 and the
first paragraph of Article 26 of these Regulations, the tourism administration
department shall order him to make corrections within a time limit and, if
any, confiscate his unlawful earnings. If he has not made corrections at the
expiration of the prescribed time limit, he shall be ordered to suspend his
business operations for 15 to 30 days for rectification and may be
concurrently imposed a fine from RMB 5,000 yuan to RMB 20,000 yuan. If the
circumstances are serious, his Tourist Agency Permit for Tourist Business may
be revoked.

    Article 34  Anyone violating the provisions of Article 19 and the second
paragraph of Article 21 of these Regulations shall be punished in accordance
with the relevant provisions of the Trademark Law of the People's Republic of
China and the Law of the People's Republic of China for Countering Unfair
Competition.

    Article 35  If anyone violates the provisions of Article 27 and the first
paragraph of Article 29 of these Regulations, the tourism administration
department shall order him to make corrections within a time limit and give a
warning. If he fails to make corrections within the time limit, he shall be
ordered to suspend his business operations for 3 to 15 days for rectification
and may concurrently be imposed a fine from RMB 3,000 yuan to RMB 10,000 yuan.

    Article 36  If the Tourist Agency Permit for Tourist Business of a tourist
agency has been revoked, the industry and commerce administrative department
shall revoke its business license correspondingly.

    Article 37  When handling the complaints prescribed in Article 24 of these
Regulations, the tourism administration department shall, if the complaints
have been proved to be true after investigation, order the tourist agency to
make compensation for actual losses suffered by tourists. If the tourist
agency refuses to or cannot afford to bear the responsibility for
compensation, the tourism administration department may make appropriations
from the quality guarantee deposit of the tourist agency for the compensation.

    Article 38  In any of the following cases where the tourism administration
department violates the provisions of these Regulations, the person in charge
directly responsible and other persons directly responsible shall be given
disciplinary sanctions according to law.

    (1) refusing to issue the Tourist Agency Permit for Tourist Business to
those applicants eligible for the Permit: or

    (2) unlawfully issuing the Tourist Agency Permit for Tourist Business to
ineligible applicants.

    Article 39  Personnel of the tourism administration departments who
neglect their duties, abuse their powers or engage in malpratices for their
personal gains shall, if crimes have been constituted, be investigated for
criminal responsibility according to law. If their acts are not serious enough
to constitute crimes, disciplinary sanctions shall be imposed according to law.
Chapter VI  Supplementary Provisions

    Article 40  These Regulations shall come into force on the date of
promulgation. The Interim Regulations on the Administration of Tourist
Agencies promulgated by the State Council on May 11, 1985 shall be repealed
simultaneously.



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