Legal Requirements - Oil & Gas Export to China

Oil & Gas Export - Malaysia SME / Company to China

1. There are no restrictions on the export of production of oil and gas to other countries subject to payment of export duties under the Custom Duties Order 2017.

2. Requirements for cross-border sales and/or supply of oil and gas is similar to other commodities that are exported, the duties have to be paid for supplies and deliveries under the Custom Act 1976 and the regulations, and certain class of licenses are required for export.

3. Under Customs processes and procedures, all exportations are under the purview and authority of Customs. However, before Customs approve the exportation and the other functionalities administered by other Government Agencies or Permit Issuing Agencies need to be processed and approved by the respective Government Agencies such MITI.

4. Permit Application and Procedure, application process is divided into 2 phases (1) Pre-registration; and (2) Permit application, with the Ministry of International Trade & Industry (Strategic Trade Act Secretariat Division), referring to regulations 3A, 4, 5(1A) of the Petroleum Regulation 1974 and regulation 5(2)(xiii) pertaining to distribution, marketing and export.

5. Pre-Registration Procedure with MITI, Strategic Trade Act Secretariat Division (STS)–

Ø Register with DagangNet - http://www.dagangnet.com to obtain ePermit System User ID and Password, via http://www.dagangnet.com

Ø Exporter submits online the pre-registration application to STS and the Licensing Agencies via http://www.mytradelink.gov.my/

Ø Application is processed by STS

Ø STS will verify and approve/reject the application; and

Ø Exporters with approved application will be given a Token (digital Signature).

6. The Process Workflow in Appendix A. Applicant needs to pre-register details of the export products and the customer/importer (end-user) including their contact details – Applicant needs to get the customer/importer to complete the end-user statement.

7. Next is the Permit Application phase–

Ø Activation of Digital Signature by Exporter (only once by new exporter); Exporters submit STA permit Application (single use/Multiple Use/Bulk) online via http://www.mytradelink.gov.my using a Token provided.

Ø STS will review and verify the STA permit application;

Ø STS will approve / reject the STA permit application

Ø Details of approved application will be sent to the Customs Information System (SMK) for validation; and

Ø Approved/rejected applicants will be notified via online.

Ø Charge/Fee – levied for STA applications or Certificate issued.

8. STA is an Electronic Permit Strategic Trade Act (ePermit [STA], the export permit required under the Strategic Trade Act (STA) 2010, is the legislation that controls the export, transhipment, transit and brokering of strategic items.

9. STA is related to the industries that many would term as normal/safe such as oil and gas, electronics, telecommunications, engineering, machinery and equipment (dual-use items).

10. Type of STA permits and application process workflows - https://www.miti.gov.my/index.php/pages/view/2586

11. Can join Matrade’s member and/or seek guidance from MATRADE to access to Export Readiness Assessment Tool (ERAT), Tips for Exporting to China, understanding Free Trade Agreements, Global Trade Information (Imports, tariffs, regulatory requirements) relating to export to China and Global Standards Information - https://www.matrade.gov.my/en/export-to-the-world

12. Registration - https://www.matrade.gov.my/en/export-to-the-world/online-services/register-as-matrade-member

13. Go Global with MyExport - https://myexport.matrade.gov.my/

14. E-declaration- Customs Declaration – Online Custom Declaration

Ø Effective 1 July 2011 compulsory declaration field in the K2 and K8 forms. Oil and Gas products are ticked as strategic item, the system will then prompt for the STA export permit’s number to be entered - http://www.customs.gov.my/en/cp/Pages/cp_ebs.aspx

Ø Custom Export Procedure – Appendix B.

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