Provisional Measures of the Shenzhen Municipality on the Administration of Grain Reserves adopted at the Eighty-First Executive Meeting of the Fourth Municipal Government is now promulgated and will take effect as of March 1, 2008.
Mayor Xu Zongheng
January 23, 2008
Provisional Measures of the Shenzhen Municipality on the Administration of Grain Reserves
Chapter I General Provisions
Article 1 In order to strengthen and standardize the administration of grain reserves, to ensure the realization of the function of government grain reserves, and to give full scope to the supplementary role of commercial grain reserves in the government’s regulation and control on a macro level and in its dealing with emergencies, these measures are hereby formulated in accordance with Regulations on the Administration of the Circulation of Grains and in the light of actual conditions of this city.
Article 2 These measures shall apply to the government grain reserves-related matters such as reserve plans, expenses subsidies, storage consignment, granting loans, using grain reserves, the commercial grain reserves-related matters such as storage, use, management, and the corresponding activities of supervision and administration.
Article 3 The government grain reserves referred to in these measures shall mean the grains and edible oil kept in reserve by the municipal people’s government (hereinafter referred to as the municipal government) and the peoples’ governments of both Baoan and Longgang districts (hereinafter referred to as two district governments) to adjust the total supply and demand of grains in the whole city, to stabilize the grain market, and to deal with major natural disasters and other emergencies, etc.
The commercial grain reserves referred to in these measures shall mean the grain and edible oil kept in stock in accordance with Regulations on the Administration of the Circulation of Grains and these measures by qualified operators which are engaged in purchasing, processing, and selling grains.
Article 4 A system shall be put into practice for government grain reserves to have an overall plan made by the municipal government and joint reserves held by the municipal and district governments, the proportion of reserves shall be 60% for the municipal government and 20% for each of two district governments, but the municipal government may adjust the proportion of reserves according to actual conditions.
Government grain reserves shall be planned according to 3-year cycles, the municipal department of development and reform shall put forward an overall plan including schemes concerning the size, variety composition, and distribution of reserves in accordance with the needs of regulations and control at a macro-level as well as with the financial capacity, solicit opinions from related units such as two district governments, municipal department of finance, municipal audit office, municipal department of trade, and the Shenzhen Branch of the Agricultural Development Bank of China (hereinafter referred to as the Shenzhen Branch of ADBC), etc., and report the plan to the municipal government for approval.
A reserve system shall be put into practice for government grain reserves to have storage consignments, dynamic reserves, and fixed expenses.
Article 5 A supplementing mechanism shall be established to make up a deficiency of government grain reserves.
Commercial reserve enterprises shall bear on their own the expenses of storage, management, etc. in keeping commercial grain reserves in stock, commercial grain reserves shall be owned by the enterprises.
When transferring commercial grain reserves to deal with emergencies, the government shall give full compensation to commercial reserve enterprises for the reasonable expenses caused by transferring commercial grain reserves.
Article 6 The municipal government may establish the relationship of friendship and cooperation in the long run with the governments of grain producing areas or enterprises in the grain business, and designate the producing areas for government grain reserves by storage consignment contracts.
The municipal, district governments may establish centralized markets for grain operation and build supporting grain warehouses in order to provide convenience for regional collection and distribution of grains.
Article 7 A municipal system of grain risk funds shall be established and improved. The grain risk funds shall be mainly used for:
(1) the normal storage of government grain reserves, adjustments of the balance of supply and demand of grains, payments for the expenses of emergency transferring;
(2) the compensation for the expenses of transferring commercial grain reserves;
(3) the awards to the related main executing agents for government grain reserves and commercial grain reserves.
The municipal department of finance shall jointly with the related units such as
municipal department of development and reform, municipal audit office, two district governments, and the Shenzhen Branch of ADBC, etc. draw up the measures on the administration of grain risk funds, report the measures to the municipal government, and implement them after approval.
Article 8 The municipal department of development and reform shall execute the following duties of the administration of grain reserves:
(1) to work out related policies on grain reserves, to make an overall plan for government grain reserves, and to put forward a plan for the required expenses of the whole city’s grain reserves;
(2) to promptly release the whole city’s plan for grain reserves, coordinate the related matters to carry out the plan;
(3) to supervise and inspect the implementation of the whole city’s plan for grain reserves such as the purchase, storage, rotation, and sale, etc. of grain reserves, to make an annual assessment of the main executing agents of the plan;
(4) to supervise and inspect the safety of grain reserves in terms of quality and storage;
(5) to be responsible for putting forward a plan for the emergency use of government grain reserves of the whole city and to coordinate its implementation;
(6) to entrust the third party with the supervision of grain reserves;
(7) the other duties of the administration of grain reserves stipulated by the municipal government.
Article 9 Two district governments shall execute the following duties of the
administration of grain reserves:
(1) to make organizational arrangements for the department of development and reform of their respective district to implement and release their respective district’s plan of grain reserves;
(2) to make organizational arrangements for the department of finance to implements the related rules of their respective district on the administration of grain risk funds;
(3) to supervise and inspect the implementation of their respective district’s plan of grain reserves such as the purchase, storage, rotation, and sake, etc. of grain reserves, to make an annual assessment of the main executing agents of their respective district’s plan;
(4) to supervise and inspect the safety of the grain reserves of their respective district in terms of quality and storage;
(5) to make organizational arrangements for the related departments of their respective district to implement the municipal government’s plan for the emergency use of grain reserves;
(6) the other duties of the administration of grain reserve stipulated by the municipal government.
Article 10 The municipal, district departments of finance shall be responsible for
bringing the expenses needed by government grain reserves into the annual fiscal budget and making a prompt, full appropriation according to related rules, supervising the use of the grain risk funds and reporting it to the government at the same level every 3 years.
The audit offices shall audit and supervise according to law the administration and use of the grain risk funds such as the storage expenses of government grain reserves, the expenses of the emergency use of grain reserves, etc.
Article 11 The Shenzhen Branch of ADBC shall be responsible for making prompt, enough loans, according to the related rules of the state, that are needed for the grain reserves of the municipal, district governments, conducting credit supervision over granted loans for government grain reserves; provide assistance for related governmental departments in their supervision over grain reserves.
Chapter II Storage and Management of Government Grain Reserves
Article 12 Government grain reserves shall be stored up in the special grain warehouses which are constructed with the investment from the municipal, district governments, and managed according to consignments by grain enterprises which meet the requirements of Article 13 of these measures.
If the capacity of the special grain warehouses constructed with the investment of the municipal, district governments cannot satisfy the needs to store up government reserves, the grain enterprises meeting the requirements of Article 13 of these measures may also be consigned to store up and manage government grain reserves in their own grain warehouses.
The grain enterprises which accept consignments according to the previous two sections shall be uniformly called consignment enterprises.
Article 13 Consignment enterprises shall meet the following requirements:
(1) to have warehousing facilities suitable to grain storage in terms of function, warehouse type, way of receiving and shipping grain, grain varieties, grain storage cycle, etc.;
(2) to have instruments and places which meet the national standards to test the grain quality grades and satisfy the requirements for checking the temperature, humidity, and pest density inside warehouses;
(3) to have the managerial, technical personnel of grain storage, testing, and pest control, etc. who have had professional training, obtained qualification certificates issued by responsible departments;
(4) to have standardized operation and management, good reputation, low asset-liability ratio, and no record of illegal operation.
If a consignment enterprise uses its own warehouses (including leased warehouses
with one-year fixed term), the total capacity shall not be lower than 5,000 tons, and the capacity in one warehouse area shall not lower than 2,500 tons (not including warehousing sheds), warehouses shall meet the national and provincial standards, and technical standards.
Article 14 On the premise of being good for the safe storage, reasonable distribution, supervision and management, and expenses reduction for government grain reserves, the municipal department of development and reform, the departments of development and reform of two district governments may, in accordance with the principle of appropriate marketization, fair competition, and selecting the best, entrust consignment enterprises with storage and management of government grain reserves by means of public bidding, competitive negotiation, etc. according to actual needs, and sign consignment contracts with them to make clear the rights and obligations of both parties.
Article 15 The municipal department of development and reform shall release the grain reserves plans respectively to their entrusted consignment enterprises and two district governments on the basis of the overall plan of government grain reserves.
Article 16 Consignment enterprises shall, in accordance with the grain reserve plans of the government and consignment contracts, organize the specific activities to implement the purchase, storage, rotation, and sale, etc. of government grain reserves.
Article 17 Consignment enterprises shall ensure that the government grain reserves stored up on consignment meet the quality requirements set by the state.
A system of warehouse-in and warehouse-out quality inspection shall be put into practice for government grain reserves. Consignment enterprises shall, in accordance with the laws, regulations of the state and the related national standards of grain quality, conduct quality inspections for grains to be put in warehouses, and issue quality inspection reports when grains are leaving warehouses. The expenses of warehouse-in and warehouse-out quality inspections and tests shall be paid as part of the fixed expenses.
Consignment enterprises shall establish and improve the grain quality files, strictly put into effect a day-to-day grain quality monitoring system, reasonably arrange rotations, prevent the ageing, molding of grains caused by the delay of rotation or bad management, and ensure the safety of grains in terms of storage and quality.
Article 18 Consignment enterprises shall make rotation plans for government grain reserves according to the principle of first in, first out, and balanced rotation.
The lowest storage of various varieties of grain reserves during the period of rotation shall not be lower than 80%, the period of keeping full storage of various varieties of grain reserves shall not less than 10 months per year.
If the requirements for the lowest storage and the period of full storage have not been met, the reserve expenses shall be cut in proportion to what has not been achieved.
Article 19 Consignment enterprises shall put into practice the special warehouses for storage, special personnel for safekeeping, special account for record in managing grain reserves, and ensure that accounts conform to each other, and accounts conform to practice. They may neither make a false report nor fail to report about the quantity of grain reserves, may neither adulterate, mix grains, nor use seconds as the best, and may not change the varieties and storage locations of grain reserves without authorization.
Article 20 Consignment enterprises shall open their basic accounts at the Shenzhen Branch of ADBC and accept its credit supervision.
Consignment enterprises may not use grain reserves and the loans for grain reserves to undertake operations not related to the reserve business, and may not use grain reserves either as collateral or to pay off debts in external transactions.
Article 21 Consignment enterprises shall establish and improve their safety management systems of fire control, protection against theft, flood control, etc., and provide necessary safety and protection facilities.
Article 22 Consignment enterprises shall establish, improve their journal accounts of grain reserves, give statistics and make analyses of the storage and management of grain reserves, and, according to their relationship of entrustment, report the rotation plans of government grain reserves, specific implementation of the purchase, sale, rotation of grain reserves, statistics and analyses to the municipal department of development and reform or the departments of development and reform of two district governments, and send copies to the Shenzhen Branch of ADBC at the same time.
Article 23 If a consignment enterprise has been cancelled, disbanded, bankrupted according to law, or no longer met the requirements of Article 13 of these measures because of serious problems in operations and management, the municipal department of development and reform or the departments of development and reform of two district governments shall make another arrangement to consign the storage of the grain reserves which have been stored up by this consignment enterprise.
Chapter III Management of the Expenses of Government Grain Reserves
Article 24 The expenses of government grain reserves shall include normal reserve expenses, emergency use expenses, and expenses to balance the supply and demand of grains.
The normal reserve expenses shall include: the interests of bank loans to consignment enterprise in order to complete the task of government grain reserves, rotation expenses and the net value of the difference caused by rotation, safekeeping expenses, expenses of insurance for both the grains in warehouses and the property of warehouses, etc. If a consignment enterprise uses its own grain warehouses, the expenses of renting the grain warehouses shall be included also.
The emergency use expenses shall include: the loss caused by the price difference between purchasing and selling government grain reserves, the related expenses of organization, shipping, distribution, etc. in emergency transferring.
The expenses to balance the supply and demand of grains shall include: the related expenses caused by the circumstances that the supply and demand of grains in this city has been seriously unbalanced, the use of grain reserves cannot meet the needs, and it is necessary to resort to the emergency use of non-governmental grain reserves.
Article 25 A system of fixed expenses shall be put into practice for the normal reserve expenses of government grain reserves. The municipal department of finance, two district governments shall jointly with the municipal department of development and reform measure and calculate the total fixed expenses according to the size of government reserves, variety composition, and distribution of grain reserves.
The normal reserve expenses of government grain reserves shall be paid by quarterly appropriations in advance and annual final accounting. In the second month of every quarter, the municipal department of finance and two district governments shall grant an appropriation for that quarter’s reserve expenses. Within the first two months of every year, the municipal department of development and reform, the departments of development and reform of two district governments shall complete the assessment of the task of government grain reserves of the previous year, and advance their opinion on the annual appropriation for reserve expenses to be examined and approved by the municipal, district departments of finance. The municipal, district departments of finance shall complete the examination and appropriation of the reserve expenses of the previous year in the first quarter of every year.
Article 26 As for the expenses caused by using government grain reserves when there is a major natural disaster or other emergencies, the municipal department of development and reform, two district governments shall jointly with the municipal department of finance put forward a plan to provide subsidies for the expenses of government grain reserves, report it to the municipal government, and implement it after approval. After the emergency management has been completed, an audit office shall carry out a special audit and then the municipal, district departments of finance shall examine and grant appropriations to consignment enterprises and related units.
Article 27 As for the various expenses to balance the supply and demand of grains, the municipal department of development and reform shall advance an opinion on using funds for the expenses, after its opinion has been reported to the municipal government and approved, the municipal department of finance shall grant an appropriation in advance. After the balance has been completed, an audit office shall carry out a special audit and then the department of finance shall examine and grant appropriations to consignment enterprises and related units.
Article 28 If a large amount of one-time, one project maintenance and repair expenses of a warehouse of grain reserves constructed with governmental investment are more than 200,000 RMB, the municipal department of development and reform shall deal with it in accordance with the measures on the administration of grain risk funds or regulations on the administration of government-investment projects after the user-enterprise makes an application according to actual needs. Small-amount maintenance and repair expenses shall be paid by the user-enterprise from the funds for normal reserve expenses.
After these measures take effect, there shall be no charge any more for the depreciation of fixed assets of a grain warehouse constructed with governmental investment.
All the maintenance and repair expenses of warehouses constructed by enterprises on their own to store up the grain reserves of the municipal, district governments shall be born by the enterprises themselves, and these warehouses may be depreciated and amortized according to the rules of the national accounting system.
Chapter IV Use of Government Grain Reserves
Article 29 The municipal department of development and reform shall improve the early warning mechanism for the use of government grain reserves of this city, strengthen its monitoring of the grain market, and make suggestions on the use of government grain reserves on time.
Article 30 If there is one of the following situations, government grain reserves may come into use:
(1) the supply of grains is obviously not adequate to the demand in the whole city or in some districts, or there are unusual fluctuations of prices in the market;
(2) there is a need to use grain reserves because of a major natural disaster or other emergencies;
(3) the other situations in which the municipal government believes it is necessary to use grain reserves.
Article 31 When intending to use government grain reserves, the municipal
department of development and reform shall put forward a plan to use grain reserves according to these measures and the contingency grain plan of the Shenzhen Municipality, and report it to the municipal government for approval. If the municipal government has approved the plan to use grain reserves, the municipal department of development and reform shall report it to the administrative department of the Guangdong Province in charge of grains.
The plan to use government grain reserves shall include items such as varieties, quantities, price, and quality of grain reserves, arrangements for using them, transportation guarantee, the budget of expenses, etc.
Article 32 The municipal department of development and reform shall, in accordance with the plan to use grain reserves approved by the municipal government, issue an order to use them, the related departments of the municipal government, two district governments, and consignment enterprises shall specifically organize the implementation.
In an emergency, the municipal government may directly make a decision to use government grain reserves and issue an order.
The related departments of the municipal government and various district governments shall give their active support and cooperation in executing the order to use government grain reserves.
Article 33 Any unit and individual shall not refuse to execute or change the order to use government grain reserves without authorization.
Article 34 If there is need to use grain reserves when a major natural disaster or other emergencies take place within two districts, two district governments may make a decision to use government grain reserves stored up in their districts by consignment, and report it to the municipal government in 3 days from the date of making the decision.
Chapter V Management of Commercial Grain Reserves
Article 35 The municipal department of development and reform shall, in accordance with the Shenzhen City’s demand for grain reserves, put forth a proposal on the size, composition, and distribution of commercial grain reserves, and the basic requirements, selection plan, and preferential policies for commercial reserve enterprises, and implement the proposal after the municipal government’s approval.
Article 36 The municipal department of development and reform shall, in accordance with the plan to select commercial reserve enterprises, determine the choice of grain enterprises to undertake commercial reserve through public bidding, competitive negotiation, etc. The municipal department of development and reform shall sign storage consignment contracts with commercial reserve enterprises to make clear the rights and obligations of both parties.
Article 37 The funds needed for the operation and storage of commercial grain reserves shall be raised by enterprises themselves, commercial reserve enterprises may apply to the Shenzhen Branch of ADBC for special loans.
Article 38 Commercial reserve enterprises shall, in compliance with storage consignment contracts and in the light of their grain operation, organize the activities of the purchase, rotation, and sale of commercial grain reserves according to law, and ensure that the varieties and quantity of commercial grain reserves meet the reserve requirements.
Article 39 Commercial reserve enterprises shall ensure that commercial grain reserves meet the quality standards set by the state, and conduct warehouse-in and warehouse-out inspections and tests of grain quality according to the related laws, regulations of the state and the related standards of grain quality set by the state.
Article 40 Commercial reserve enterprise shall establish their journal accounts of grain operation and files of grain quality, establish a sound system of operation management and quality management for grains, ensure the safety of grains in terms of storage and quality, submit statistical reports and statistical analyses on a regular basis to the municipal department of development and reform according to the requirements of the system of grain circulation statistics, and accept the supervision and inspection by the municipal department of development and reform.
Article 41 If government grain reserves cannot satisfy the requirements for the total grain supply and the supply time in using grain reserves, the municipal government may make a decision to use commercial grain reserves.
Commercial reserve enterprises shall implement the decision of the municipal government on using grains in an emergency. As for the related expenses caused by using grains, commercial reserve enterprises shall submit their applications to the municipal department of development and reform, and this department shall grant appropriations according to the measures on the administration of grain risk funds.
Chapter VI Supervision and Inspection
Article 42 The municipal department of development and reform, the municipal department of finance, the municipal audit office, and the related departments of two district governments shall carry out the supervision and inspection of government grain reserves according to their respective duties and in compliance with these measures and the laws, regulations on grain management.
The municipal department of development and reform shall carry out the supervision and inspection of commercial reserve enterprises according to these measures and related rules.
Article 43 In the process of supervision and inspection, the related functional departments shall exercise the following functions and powers:
(1) to inspect the quantity, varieties, and quality of grain reserves and the safety of storage, etc.;
(2) to inquire of related units and personnel about the purchase, sale, and rotation of grain reserves, and the execution of the order to use grain reserves;
(3) to send for the related data, evidence concerning grain operation and management for inspection;
(4) to investigate and punish illegal acts.
Any unit and individual shall not refuse, obstruct, and interfere in the execution of
duties of supervision and inspection carried out by the personnel of supervision and inspection according to law.
Article 44 The personnel of supervision and inspection shall make a written record of the supervision and inspection of grain reserves, both the personnel of supervision and inspection and the person in charge of the unit accepting the supervision and inspection shall sign this record. If the person in charge of the unit accepting the supervision and inspection refuses to sign, the personnel of supervision and inspection shall put the related situation on record.
Article 45 Consignment enterprises, commercial reserve enterprises shall cooperate with the personnel of supervision and inspection of the functional departments of governments related to the administration of grain reserves in executing their duties according to law.
If the functional departments of governments related to the administration of grain reserves find in the process of supervision and inspection that there are problems with the quantity, varieties, quality of grain reserves and the safety of storage, etc., they shall enjoin consignment enterprises, commercial reserve enterprises to immediately make corrections or deal with the problems; in case of finding that consignment enterprises, commercial reserve enterprises have no longer met the requirements for storing up grain reserves or have seriously breached storage consignment contracts, these enterprises shall be disqualified for consignments to store up government or commercial grain reserves. If a department carrying out the supervision and inspection has no corresponding authority to handle the case, it shall be reported in writing to a department having corresponding authority to deal with the case.
Article 46 Consignment enterprises, commercial reserve enterprises shall strengthen their operation management and inspection of grain reserves, and promptly correct for the problems with the quantity, varieties, quality of grain reserves and the safety of storage, etc. As for the major problems jeopardizing the safety of grain reserves in terms of storage or quality, effective measures shall be immediately taken to address these problems, reports shall be promptly submitted to the municipal department of development and reform or the departments of development and reform of two district governments.
Article 47 The Shenzhen Branch of ADBC shall strengthen the credit management of the loans for grain reserves according to the rules on segregated accounts, consignment enterprises, commercial reserve enterprises shall give their cooperation and provide related data and explanations on time.
Chapter VII Legal Liabilities
Article 48 If one of the following situations applies to the municipal department of development and reform, the municipal department of finance, the municipal audit office, two district governments, the Shenzhen Branch of ADBC, and other related departments in violation of these measures, administrative sanctions shall be imposed according to law on directly responsible persons in charge and other directly responsible persons; those suspected of committing crimes shall be transferred to a judicial office for settling their cases according to law:
(1) to fail to release grain reserve plans, to arrange grain risk funds or to appropriate funds on time;
(2) to qualify an enterprise, which is not qualified for storage consignment, for storing up government grain reserves, or to fail to disqualify a consignment enterprise after having found it no longer meets the requirements for storage consignment;
(3) to fail to investigate and punish illegal acts promptly after receiving reports and finding such acts, or to fail to actively execute duties in other ways;
(4) to embezzle, hold back, misappropriate the loans for government grain reserves or reserve funds, etc.;
(5) to carry out other acts of abusing power, playing favoritism and committing irregularities, or neglecting duties in violation of these measures.
Article 49 If one of the following situations applies to a consignment enterprise
of government grain reserves, the municipal department of development and reform or departments of development and reform of two district governments shall enjoin the enterprise to make corrections by a deadline, if there are illegal earnings, these earnings shall be recovered according to the consignment contract; if the circumstances are serious, the enterprise shall be disqualified for storage consignment; those suspected of committing crimes shall be transferred to a judicial office for settling their cases according to law:
(1) to refuse to organize the implementation of plans to store up grain reserves and orders to use grain reserves or to change the plans and orders without authorization, or to hoard and speculate, to force up grain prices in the name of grain reserves;
(2) to fail to make corrections promptly after having found there are problems with the quantity, composition, and quality of grain reserves, or to fail to take effective measures immediately to deal with the matter and make a report according to rules when having found the problems jeopardizing the safety of grain reserves in terms of storage and quality;
(3) to put in warehouses the grains which do not meet the quality grade requirements and the national standards;
(4) to fail to put into practice the special warehouses for storage, special personnel for safekeeping, special account for record, or to have neither conformity of accounts to each other, nor conformity of accounts to practice;
(5) to refuse, obstruct, interfere in the execution of the duties of supervision and inspection by the personnel of supervision and inspection according to law;
(6) to make a false report, to fail to report about the quantity of grain reserves;
(7) to adulterate, mix grains, and to use seconds as the best;
(8) to change the varieties and storage locations of grain reserves without authorization.
(9) to cause the ageing, molding of grain reserves;
(10) to embezzle, hold back, misappropriate the loans for grain reserves or reserve funds, or to use grain reserves as collateral or to use them to pay off debts in external transactions
(11) to carry out other acts in violation of these measures.
If commercial reserve enterprises violate storage consignment contracts, the
municipal department of development and reform shall investigate and affix their responsibility for breaching agreements according to storage consignment contracts; if their acts of breaching agreements violate related laws, regulations at the same time, the related departments shall deal with them according to law.
Article 50 Those who, in violation of these measures, sabotage the storage facilities of grain reserves, steal, engage in open plunder of, and damage grain reserves shall be punished according to Law of the People’s Republic of China on Public Security Administration Punishments, those suspected of committing crimes shall be transferred to a judicial office for settling their cases according to law, those who have caused property damages shall be held liable for civil compensation according to law.
Chapter VIII Supplementary Provisions
Article 51 These measures shall take effect as of March 1, 2008.
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