Article 1
In order to ensure normal delivery business operation for white granulated sugar (hereinafter referred to as the Sugar) at Tianjin Bohai Commodity Exchange (hereinafter referred to as the Exchange), and to regulate the sugar delivery activities of the designated warehouses (hereinafter referred to as the Warehouses), this Rules is enacted subject to the Interim Measures of Tianjin Bohai Commodity Exchange for Trading Market Supervision and Administration, Jin Zheng Fa [2009] No 32. and the Rules of Tianjin Bohai Commodity Exchange for Continuous Spot Trading Management.
Article 2
The sugar delivery business shall be operated in accordance with this Rules. The Exchange, traders and the Warehouses shall comply with the Rules.
Article 3
The designated sugar warehouses refer to the warehouses designated by the Exchange to provide physical delivery and storage services for the Sugar listed in the e-contracts in order to fulfill the obligations of the contracts.
Article 4
A registered warehouse receipt refers to a valid document that evidences that the trader has delivered the qualified commodity to warehouse and received the Exchange’s approval and registration. The documents also assure certain quantity and quality for a batch of a commodity.
Article 5
Any trader who submits the delivery declaration has to be a legal entity that has registered with the Industrial and Commercial Administration Department, possesses the corresponding white granulated sugar’s business license and relates to the Sugar’s production, operation or consumption activities.
Article 6 Entry of Commodity
6.1 Application for the entry of commodity
6.1.1 Traders shall submit the Application for Entry to the Warehouse as required before delivering the commodities. The application shall include the name of manufacturer, the grade, the weight, the quantity, and the time scheduled for entering the Warehouse. The applicant’s official seal is required if the application is sent via facsimile.
6.1.2 The Warehouse shall decide within two business days whether to approve the application considering both its capacity and the commodity owner’s willingness, and indicate the deadline for the commodity entry if the application is approved. The trader shall submit the storage deposit to the Warehouse in accordance with the requirements of the Warehouse and the applicable rules.
6.2 Entry of Commodity
6.2.1 Traders shall deliver the commodity to the Warehouse specified in the Application for Entry within the prescribed time limit, and provide the relevant documents. If both the quality and the package of the commodity meet the delivery standards stipulated by the Exchange, then the owner can move to the next step.
Documents required for domestic sugar are: original Hygienic Certificate, original Quality Certificate, original Food Production License, a photocopy of the business license of the manufacturer, and the Inspection Report issued by the manufacturer.
Documents required for imported sugar are: a photocopy of Entry Declaration the Customs of the People’s Republic of China, which allows the batch of sugar to be for sale in China (Trade Mode: General Trade); a Hygienic Certificate issued by the Entry-Exit Inspection and Quarantine Bureau of the local government; a Product Quality Certificate, Place of Origin Certificate, and the signed The Assurance of Legitimate, Authentic, and Valid Documents for Imported White Granulated Sugar.
6.2.2 Upon the arrival of the sugar, the Warehouse shall do the inspection on the package as required. The label and package of the Sugar shall meet both the requirements of GB317-2006 and the newest applicable rules and regulations. The imported sugar must have the contents including the product name, the net weight, the manufacturer, and the date of production on the sign or the label; other contents are not required. The Sugar must not be allowed to enter if it is moldy, contaminated, damp, lumped, or if it has an odor.
The sugar shall be placed according to the manufacturer, the brand name, and production date. If the owner insists on placing the sugar produced by the same manufacturer but on different production dates at the same storage space, the earliest production date is taken to be the production date of this batch of sugar. A storage card must be placed in front as required.
6.2.3 Upon the arrival of sugar, the Warehouse shall do the mobile sampling or intubation sampling, and send the samples to the appointed Quality Inspection Institution. The sample is taken from each storage space for every batch of sugar. The sample is divided into two portions (labeled as A and B). Both A and B shall be sealed and sent to the inspection institution. A shall be used for the quality inspection, and B shall be kept for re-inspection (if it is necessary). The commodity owner can also authorize a third-party inspection institution (accredited by the State Department of Quality and Technical Supervision) to take a sample, and the costs incurred shall be solely borne by the commodity owner. The Warehouse shall supervise the sampling process.
The appointed Quality Inspection Institution shall issue the Quality Inspection Report and notify the Warehouse within 5 business days after receiving the sample. The Warehouse shall therefore notify the owner. Two copies of the Quality Inspection Report are issued by the Quality Inspection Institution. One copy shall be kept by the Warehouse and the other copy shall be kept by the Exchange.
6.2.4 Commodity owner is supposed to be present while their commodity is being inspected; otherwise, it will be deemed that the commodity owner accepts the inspection result given by the Warehouse.
6.2.5 Re-inspection
A Re-inspection Application shall be sent to the Exchange within two business days after the commodity owner or the Warehouse has received the Quality Inspection Report and is not satisfied with it. The re-inspection fee shall be prepaid. It shall be deemed the inspection result is satisfactory if no claim is submitted within the above-mentioned period of time. The Exchange shall not accept any overdue application.
The original Quality Inspection Institution will do the re-inspection on Sample B and no new sample shall be taken. The re-inspection items are restricted to only those items being applied for re-inspection. The Quality Inspection Institution shall issue the Re-inspection Report within four business days after receiving the re-inspection notice from the Exchange. The re-inspection results shall be the basis to settle the dispute. If the re-inspection results are consistent with the original results, then the default party shall bear all re-inspection related costs and any immediate economic loss. Otherwise, the original Quality Inspection Institution shall bear the costs.
6.2.6 The Warehouse shall issue the standard-formed Warehouse Receipt to the commodity owner after the commodity meets the Exchange’s delivery standards. The Warehouse Receipt has three portions; the Exchange, the Warehouse, and the commodity owner each keep one portion.
Article 7
The commodity referred to in the Warehouse Receipt shall only be picked up against the corresponding Bill of Lading issued by the Exchange.
Article 8
Formation of the Registered Warehouse Receipt
8.1 Application
8.1.1 Traders who possess warehouse receipts can submit the Application for Registered Warehouse Receipt to the Clearing Department.
8.1.2 Traders shall pay off all storage-related fees up until the day of application.
8.1.3 The quantity of Sugar applied for on a Registered Warehouse Receipt must be greater than 1 ton.
8.1.4 Quality Standard
The standard product for delivery is 1st grade white granulated sugar that meets GB317-2006 standards. Domestic white granulated sugar is deliverable during the Sugar Year (defined as October 1 of each year till September 30 of the following year) and until November 15 of the year in which the Sugar Year ends. The discount standards begin to be applicable from August of the year in which the Sugar Year ends. The discount standard is 10 Yuan per ton for every month from August onwards and shall be calculated when making the payment for the delivery. The imported white granulated sugar (including white granulated sugar produced from imported raw sugar) is deliverable within 12 months from is the date of manufacture. No premium or discount is applicable.
The quality standards of substitutes and the price adjustment range are shown in the table below.
|
Grade |
Quality Standards Range |
Price Adjustment |
|
Premium Minus Grade |
Sucrose/（%）：≥99.7；Reducing Sugars/（%）：≤0.04；Conductivity Ash/（%）：≤0.04；Loss on drying/（%）：≤0.06；Color/IU≤80；Turbidity/MAU≤80；Insoluble impurities in water/（mg/kg）≤20。 |
Premium 50 Yuan/ton |
|
Premium Grade |
Sucrose/（%）：≥99.7；Reducing Sugars/（%）：≤0.04；Conductivity Ash/（%）：≤0.04；Loss on drying/（%）：≤0.06；Color/IU≤60；Turbidity/MAU≤80；Insoluble impurities in water/（mg/kg）≤20。 |
Premium 100 Yuan/ton |
|
Superior minus Grade |
Sucrose/（%）：≥99.8；Reducing Sugars/（%）：≤0.03；Conductivity Ash/（%）：≤0.02；Loss on drying/（%）：≤0.05；Color/IU≤45；Turbidity/MAU≤30；Insoluble impurities in water/（mg/kg）≤10。 |
Premium 150 Yuan/ton |
8.2 Verification and Approval
Upon receiving the Application for Registered Warehouse Receipt, the original Warehouse Receipt and other quality certificates, the Delivery Department shall, within 2 trading days, verify the contents of the Warehouse Receipt as to the quantity and quality of the Sugar, and decide whether to issue the Registered Warehouse Receipt.
8.3 Issuance
8.3.1. For those Warehouse Receipts qualified for registration, the Delivery Department shall generate the corresponding Registered Warehouse Receipts and issue them to the traders. The Sugar referred to in each Registered Warehouse Receipt should be the same grade and be produced by the same manufacturer. The earliest date of manufacture on the Sugar is taken to be the manufacturing date for this Receipt. The validity of the Registered Warehouse Receipt shall not extend beyond the delivery period prescribed by the Exchange.
8.3.2. After the Registered Warehouse Receipt has come into effect, the Exchange shall inform the Warehouse. The commodity referred to in the Registered Warehouse Receipt shall only be picked up against the corresponding Bill of Lading.
8.3.3 The Registered Warehouse Receipts shall be in circulation in paper form for physical delivery business.
Article 9
Physical delivery of Sugar must be accomplished within the time limit prescribed by the Exchange。 The day of successful delivery matching shall be defined as D1，and the next 15 business days shall be defined as D1，D2，D3, … D15.
9.1 D1
9.1.1 Buyers and sellers who hold contracts for Sugar may make delivery declarations during the declaration period between 16：00 p.m. – 16：15 p.m. of D1 in the way prescribed by the Exchange. The e-trading system of the Exchange shall match the buyers and sellers’ delivery declaration automatically, based on the principles of “time priority, daily maximized delivery”.
9.1.2 The intermediate position trader may make the delivery declaration between 16:15 p.m. and 16:30 p.m. subject to the Sugar delivery declarations discrepancy. The e-trading system matches the declarations on the principle of “time priority”.
9.1.3 Based on the delivery declaration result, the Exchange shall send the delivery notices to the terminal of the traders, whose delivery declarations have been successfully matched. In case of failure to match，the traders are entitled to receive compensation for deferred delivery in accordance with the applicable rules of the Exchange.
9.1.4 Buyers and Sellers whose delivery declarations have been successfully matched shall submit the delivery commitment, which is 20% of the value of the underlying commodity to be delivered（calculated based on the settlement price on that day）, in accordance with the applicable rules of the Exchange. At the same time, the Exchange shall release the margin of the corresponding contracts.（The system automatically creates holding positions on the opposite direction for the intermediate position trader whose delivery declarations have been successfully matched.）
9.2 D2
9.2.1 Payment. The buyer shall provide the intention for delivery. The buyer shall transfer the remaining 80 % of payment to the specific clearing account with the Exchange before 14:00 pm of D2，and the Exchange collects the payment on behalf of the seller. Meanwhile, the buyer shall submit the Letter of Intention of the commodity demanded to the delivery department via facsimile or other methods allowed by the Exchange. The Letter of Intention shall include the commodity name，the quantity and the designated warehouse. However, all traders must accept the Exchange’s delivery matching results if there is any conflict.
9.2.2 Sellers submit the Registered Warehouse Receipts.
The seller shall submit the legitimate and valid Registered Warehouse Receipts to the Exchange before 14:00 pm of D2, and pay off all the warehouse expenses incurred up to D4.
9.2.3 The Exchange allocates the Registered Warehouse Receipts. The Exchange shall allocate the Registered Warehouse Receipts that it has received among the buyers based upon the principle of “adjacent allocation and overall arrangement”.
9.2.4 The Exchange shall inform the buyers whose declarations are successfully matched of the detailed matching results via telephone，facsimile or other method.
9.2.5 The Exchange shall issue the Bill of Lading to the buyer against the Registered Warehouse Receipts that the seller has submitted, and keep the corresponding Registered Warehouse Receipts for record. The Bill of Lading shall be stamped by the Delivery Department of the Exchange and then faxed to both the buyer and the corresponding designated warehouse. The designated warehouse shall verify the information with the trader who comes to pick up the goods and send out the goods. The original Bill of Lading shall be kept by the Exchange.
9.2.6 Payment Collection. After confirming that the seller has paid off all the storage-related costs up to D4, the Exchange shall transfer the payment collected from the buyer to the seller’s specific clearing account before 17:30 pm of D2. Under some special circumstances, the Exchange may defer the delivery payment.
Article 10
Buyers shall pick up the goods or re-deposit the goods within the prescribed days (D3 or D4) at the corresponding designated warehouse.
Buyers shall stamp their own official seal on the Bill of Lading and the nominated person can pick up the goods with personal identification at the corresponding Warehouse.
Traders who cannot complete pickup of goods within the prescribed time shall consult with the designated warehouse. They may either re-sign the Goods Delivery Agreement with the Warehouse or apply for a new Warehouse Receipt and re-deposit the goods for another delivery.
Article 11
If there is no dispute from the buyer about the commodity’s quality and quantity within 2 business days after D2, or the dispute has been settled, the seller shall issue the VAT invoice to the buyer before D15 (inclusive); after the buyer has verified the invoice, or no dispute about the invoice is brought up by the buyer before D15 (inclusive), the Exchange shall return the delivery commitment to the seller.
Article 12
In case of any disputes about the quality of the Sugar, the buyer shall submit an application in written form within four business days after the day in which the delivery declaration is successfully matched. The original appointed Quality Inspection Institution shall perform the re-inspection and issue the Quality Inspection Report before D11 (inclusive).
The Warehouse shall cooperate, take samples as required, and deliver the samples to the appointed Quality Inspection Institution after receiving the re-inspection application. The appointed Quality Inspection Institution shall issue the Quality Inspection Report within 5 business days after receiving the Sugar samples and notify both the Exchange and the Warehouse of the result.
It shall be deemed that the buyer is satisfied with the Sugar picked up if no dispute is submitted within the prescribed time. The Exchange shall not accept any overdue applications.
Article 13
If the buyer requests to do the inspection within the prescribed time limit, the Sugar is considered satisfactory if the color (IU) changes due to natural alteration and is not greater than 240 IU. It is not a default and the buyer shall not refuse to accept the Sugar. The matter of color change shall be dealt with based on the following:
13.1 If the color (IU) ≤150 IU, both parties (the buyer and seller) shall settle based upon the actual grade given in the Quality Inspection Report. The Warehouse shall not bear any premium or discount responsibilities for the color change.
13.2 If 150IU ≤the color(IU)≤190IU, both parties shall settle based upon the settlement price of 1st grade Sugar on the day in which the delivery declaration is successfully matched. Neither sellers nor the Warehouse shall bear any premium or discount responsibilities for the color change.
13.3 If 190IU ≤the color(IU)≤240IU, both parties shall settle based upon the settlement price of 1st grade Sugar on the day in which the delivery declaration is successfully matched. Sellers shall not bear any premium or discount responsibilities for the color change. The Warehouse shall compensate 10 yuan/ton to the buyer for every 10 color (IU) increases (rounded up to the nearest 10 if the increment is less than 10).
13.4 Buyers can refuse to accept the Sugar if its color (IU) is greater than 240 IU. The Warehouse shall bear all responsibilities for the default.
Article 14
The Exchange reserves the right to interpret the said Delivery Rules.
Article 15
Please refer to the Measures for Registered Warehouse Receipts Management, the Detailed Delivery Rules, or other applicable rules for matters not mentioned herein.
Article 16
This Regulation shall become effective as of the date of promulgation.
Tianjin Bohai Commodity Exchange Ltd.
2011-01-14
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