Editor's Note: In recent years, in the wave of economic development and market change, China's refined oil circulation field industry regulation has gone through a number of major reforms. 2025, February 5, the General Office of the State Council issued the "Opinions on Promoting the High-quality Development of the Circulation of Refined Oil Products" (State Council [2025] No. 5), put forward five aspects of the 21 specific initiatives, the refined oil industry tax-related regulation has also made four important deployments. This article analyzes the key points of the new policy in light of the evolution of the policy. Under the new regulatory environment, enterprises need to actively respond and establish a sound tax compliance system to adapt to the new situation where wide access and strong regulation coexist.

I. Opinions of the General Office of the State Council: from "strict access" to "wide access and strong regulation"

In recent years, China's refined oil circulation policy has shifted from "strict access" to "wide access and strong regulation", and the introduction of "Opinions on Promoting High-Quality Development of Refined Oil Circulation" has provided policy support for the industry's high-quality development. The following is a summary of the evolution of the relevant policies and the broad access and strong regulatory measures in the opinions of the General Office of the State Council.

(i) Reviewing the evolution of policies on the distribution of refined petroleum products

a. Strict access under the administrative licensing system

In June 2004, the State Council issued the "Decision of the State Council on Setting Administrative License for Administrative Approval Items that Need to be Retained" (State Council Decree No. 412), formally establishing the administrative license of "Petroleum Refined Oil Wholesale, Warehousing, and Retail Qualification Examination and Approval" in the form of administrative regulations, which is explicitly implemented at a hierarchical level by the Ministry of Commerce and the provincial commerce departments. Implementation. Two years later, the Ministry of Commerce issued the Measures for the Administration of the Refined Oil Market in 2006 (Ministry of Commerce Decree No. 23 of 2006), which pointed out that the state implements a licensing system for the operation of refined oil products, in which the Ministry of Commerce is responsible for the implementation of the licenses for the operation of refined oil products wholesaling and warehousing, and the provincial commerce departments are responsible for the implementation of the licenses for the operation of refined oil products retailing. 2016, the State Council published State Council Decree No. 671, which partially amended Article 412. In 2016, the State Council promulgated State Council Decree No. 671, which partially amended Document No. 412, but the administrative licensing program of "Petroleum Products Wholesale, Warehousing, and Retail Operation Qualification Approval" is still retained without change.

Overall, the core logic of this stage is to strictly control market access, enterprises in order to obtain the qualification of refined oil products wholesale, storage and retail operation, all need to declare at each level, the approval process is complex, and administrative intervention is strong.

b. Reconfiguration of the system under the reform of decentralized services

Against the background of the country's continuous promotion of the reform of releasing management and serving in 2019, the Opinions of the General Office of the State Council on Accelerating the Development of Circulation and Promoting Commercial Consumption (Guo Ban Fa [2019] No. 42) abolished the approval of the qualifications for the operation of refined oil products wholesale and storage, and decentralized the approval of the qualifications for the operation of refined oil products retail to the people's governments at the prefectural and municipal levels. In order to implement the requirements of the State Council [2019] No. 42, the Ministry of Commerce pointed out in the Notice on Doing a Good Job in the Reform of the Management of the Circulation of Petroleum Refined Products "Release of Management and Service" (Commercial Transportation Letter [2019] No. 659) that it is necessary to do a good job in the policy convergence after the cancellation of the approval of the qualification for the wholesale and warehousing operation and the decentralization and transfer of the approval of the qualification for the retail operation, Develop and improve the management system and strengthen the management of the petroleum refined oil circulation industry. The Circular also pointed out that the competent departments of commerce in each province should formulate or improve the normative documents to strengthen the management of the circulation of petroleum products in the region as soon as possible.

In July 2020, in order to implement the "Regulations on Optimizing Business Environment" and the requirements of the State Council on the reform of the "release of management and service" of the management of the circulation of petroleum products, the Ministry of Commerce repealed the "Measures for the Administration of the Market of Refined Oil Products" simultaneously.In September 2020, the State Council also abolished the administrative licenses for the approval of the qualifications for the wholesale and storage operation of refined oil products in the "Decision on the Cancellation and Decentralization of a Batch of Administrative Permissions" (Guo Fa No. 13 [2020]), the State Council also abolished the administrative licenses for the approval of the qualifications for the operation of refined oil products wholesaling and warehousing, and put forward a four-point requirement for the enhancement of the supervision measures during and after the incident, but the overall situation is relatively broad.

At this stage, the approval of the qualification of refined oil products wholesaling and warehousing operation no longer requires administrative licenses, and the market players compete fairly, but this does not mean that there is no need for supervision, and the business sector has the right to inspect the establishment and implementation of the system of purchase, sale, and entry/exit accounts of the enterprises, and the compliance requirements of the enterprises have become more and more detailed, and the relevant enterprises must meet the requirements of laws and regulations and standards on natural resources, planning, construction, quality and measurement, environmental protection, production safety, fire protection, security, anti-terrorism, commerce, taxation, transportation, meteorology, and so on. The relevant enterprises must comply with laws, regulations and standards in the areas of natural resources, planning, construction, quality and measurement, environmental protection, production safety, fire protection, security, anti-terrorism, commerce, taxation, transportation and meteorology. The approval of the qualification for retail operation of refined oil products has also changed, and its approval authority has been decentralized to prefectural and municipal governments, which means that enterprises no longer need to apply to the prefectural and municipal governments before submitting the application materials to the provincial departments, greatly simplifying the application process. It can be said that both the abolition of administrative licenses and the decentralization of approval authority have reduced the cost of entry for enterprises, which is conducive to stimulating market vitality.

c. the local first forced the national level refined oil system improvement

We observe that during the policy window after the Measures for the Administration of the Refined Oil Products Market was repealed, Jiangsu, Hangzhou, Shenzhen and Guangdong took the lead in introducing local government regulations to refine the regulatory rules. The methods formulated by the localities are mostly refined under the requirements of several points in the Letter of Commerce and Transportation [2019] No. 659 and Guo Fa [2020] No. 13. In addition, the Ministry of Commerce (MOFCOM) also published the Measures for the Administration of the Circulation of Refined Oil Products (Exposure Draft) in June 2023, but the measures were delayed. The Exposure Draft provides for the implementation of access license management for the retail operation of refined oil products, and the implementation of administrative filing management for the wholesale and storage operation of refined oil products.

In the context of the above policy, the General Office of the State Council recently issued the "Opinions on Promoting the High-Quality Development of Refined Oil Circulation" (State Council [2025] No. 5), which puts forward 21 specific initiatives in five areas. In my opinion, this is not only an endorsement of the content of the "Measures for the Administration of the Circulation of Refined Oil Products (Draft)", but also a systematic integration of local practices, by enhancing the effectiveness of the policy level, to solve the cross-sectoral synergies, and to set the tone for the unified management of the country. It can be said that the regulation of refined oil products has begun to transform from "decentralized governance" to "national chess". In this regard, enterprises in the refined oil distribution field should pay attention to the new environment where wide access and strong regulation coexist, and proactively do a good job in risk response and compliance management.

(ii) Measures of "broad access" in the opinions of the General Office of the State Council

The measures for "widening access" in the field of oil products circulation in the Opinions on Promoting the High-quality Development of Oil Products Circulation are summarized as follows:

First, the implementation of record management of refined oil products wholesale storage operations, enterprises need to hold a business license containing the scope of business of refined oil products wholesale storage, and in accordance with the law to obtain the hazardous chemicals business license, port operation license and other qualifications, complete the record of the Commerce Department, with the receipt of the record to the tax department to open the refined oil products invoicing module. Secondly, we have formulated and strictly implemented the national unified qualification standards for access to the retail operation of refined oil products, and the approval department will enter the licensing results into the information system and publicly notify them. Third, optimizing the layout of retail outlets, scientifically preparing development plans, integrating urban and rural development, rationally distributing gas station outlets, and encouraging large-scale backbone enterprises to extend their retail systems to rural and remote areas. Fourth, supporting the upgrading of rural gasoline stations, implementing relevant policies, encouraging their transformation and upgrading into gasoline stations, and expanding non-oil business in line with the characteristics of rural consumption. Fifth, promoting the development of chain operations of refined oil retail enterprises, promoting the development of enterprises to specialized and vertical chain brands, and encouraging small and medium-sized gas stations to realize unified procurement, distribution and management through hosting, leasing, joint ventures and cooperation.

(iii) "Stronger Regulation" Measures in the Opinions of the General Office of the State Council

At the same time as the relaxation of market access, the General Office of the State Council also put forward the corresponding "strong regulatory" measures, as summarized below:

First, the standardized management of accounts. Supervise enterprises to strictly implement the provisions of refined oil account management, according to the actual accounting and reporting of oil purchases and sales and inventory data, the implementation of bulk gasoline purchases and sales of real-name registration system, the organization to carry out "double random, a public" supervision. Second, cross-sectoral joint supervision. Local people's governments at all levels have established a cross-sectoral joint supervision mechanism for the circulation of refined oil products, clarified the division of responsibilities among the leading supervisory departments, law enforcement departments and other departments, and promoted the smooth convergence of administrative approval, daily supervision and comprehensive administrative law enforcement. Third, data sharing and digital supervision. Regularly collect and share basic corporate information such as production, operation and transportation of refined oil products, invoicing module, business license scope of business, explore the collection of tank level monitoring data, and deepen the sharing of key data such as production and processing of oil refining enterprises and the purchase, sale and inventory of gas stations. Fourth, the key areas of supervision. The main performance is to strengthen the supervision of production safety, strengthen the management of environmental protection standards, strengthen the quality of measurement supervision, standardize the Internet sales of refined oil and crack down on illegal behavior. Fifth, credit management and incentive constraints. Promote the credit rating and classification management of refined oil business enterprises, and take differentiated regulatory measures based on the credit situation of enterprises. Improve the incentive and constraint mechanism, and notify the typical cases of ineffective promotion for interviews and order rectification.

II. the State Council's "Opinions on Promoting the High-Quality Development of Refined Oil Circulation" deployed four tax-related regulatory initiatives

Tax-related issues in the circulation of refined oil products have always been a key area of supervision. In recent years, with the development of the refined oil products market, related tax-related violations have occurred from time to time, bringing challenges to tax collection and management and market order. In response to the various problems in practice, the State Council has deployed four important tax-related regulatory initiatives, which will be analyzed in the following paragraphs.

(i) Make the administrative filing receipt a necessary condition for the opening of the invoicing module for refined oil products

For petrochemical enterprises, they need to have a refined oil module to issue external invoices, and the external invoicing of trading enterprises is limited by the inventory data in the refined oil module. The State Office of this opinion is clear, enterprises engaged in refined oil wholesale warehousing operations, should be held in the business scope of refined oil wholesale warehousing business license, according to the "Regulations on the Safe Management of Hazardous Chemicals" and other relevant regulations to obtain hazardous chemicals business license, port operating license, according to the relevant provisions of the business sector for the record, with the receipt of the filing to the tax department to open the invoicing module of refined oil products. In other words, refined oil wholesalers and warehousing enterprises to open the module of refined oil products, now need to meet the specific conditions, that is, with the receipt of the record to open, the past individual enterprises to apply for the opening of the module of the unlawful behavior at will will be curbed.

However, in practice, petrochemical enterprises need to pay special attention to local policy differences and historical legacy issues. First, local filing rules vary, Jiangsu and other places have issued relevant measures or implementation rules, but some local policies lag behind, enterprises may face the dilemma of no regulations to follow. Secondly, some enterprises have previously acquired refined oil modules through gray channels, and the new State Council policy may trigger a backtracking process, leading to disruption of operations and even legal liabilities. It is recommended that enterprises continue to track the local filing policy to ensure that the license is complete and effective; enterprises that have opened the refined oil module need to conduct a comprehensive self-check and prioritize the missing qualifications to avoid module freezing affecting invoicing. In addition, enterprises should also note that those refined oil wholesale and storage enterprises that have not applied for the hazardous chemical operation license or port operation license, or the relevant license has expired, should register the change of the business scope of business license according to the law, and shall not engage in refined oil wholesale and storage related activities before obtaining the license.

(ii) Establishment and improvement of an account management system

The General Office of the State Council pointed out that it is necessary to improve the enterprise account management system. Supervise enterprises to strictly implement the provisions of refined oil account management, according to the factual accounting and reporting of oil purchases and sales and inventory data, improve the source of refined oil, sales destination, inspection reports, inspection records and other vouchers and materials files, save the complete books for inspection. Implement a real-name registration system for the purchase and sale of bulk gasoline. The organization carries out "double random, one open" supervision, focuses on checking the establishment and implementation of the enterprise account system, guides enterprises to continuously improve the accuracy and timeliness of updating the account, and discovers violations of law and regulations in accordance with the law. In this regard, enterprises are required to establish complete purchase and sale, entry and exit accounts, keep inspection reports and other vouchers for inspection, and accept "double random, one open" supervision.

It is noteworthy that the State Administration of Taxation Announcement No. 3 of 2015 mentioned that taxpayers should fill in the paper Product Oil Inventory Reporting Form based on the data of the "Tax Offset Ledger (Taxable Consumer Goods Levied from Volume to Quantity)" and the change of inventory, and submit it to the competent tax authorities together with the information annexed to the tax return for the consumption tax of product oils. And this provision was repealed by the State Administration of Taxation Announcement No. 1 of 2018. Since March 2018, refined oil enterprises are not required to report the paper version of the inventory report form, but rather record the inventory data into the VAT invoice selection confirmation platform. Now, the opinions of the General Office of the State Council require the improvement of the enterprise account management system. Article 12 of the "Measures for the Administration of the Circulation of Refined Oil Products (Exposure Draft)" stipulates that "the provincial department in charge of commerce is responsible for formulating a model text for the purchase and sale of oil products and the inventory ledger, and improving the standardization and informationization of the ledger", and we assume that the ledger will be formulated and managed by the commerce department in the next step. In the future, the ledger will not only continue to provide data support for tax supervision, but also lay the foundation for market supervision, quality supervision, environmental protection and other areas of supervision.

(iii) Clear cross-sectoral and chain-wide sharing of enterprise information and key data

In terms of strengthening the application of upstream and downstream data sharing in the circulation of refined oil products, the General Office of the State Council pointed out that regular collection and sharing of basic information on the production and transportation of refined oil products, the opening of the invoicing module of refined oil products, the scope of operation of the business license includes the operation of refined oil products, and the scope of the license for the production of national industrial products includes the production of refined oil products, etc., and the exploration of the collection of monitoring data on the level of tanks to deepen the sharing of key data such as production and processing of refineries and Gas stations (points) import, export and inventory and other key data sharing. Data and information security management should be effectively strengthened.

It can be seen that the General Office of the State Council comments clearly the government departments concerned should implement the collection of the opening of refined oil invoicing module, such as the basic information of the enterprise (such as the list of enterprises, place of registration, etc.), tank level monitoring, import, export and storage and other data responsibilities, and jointly build a full chain traceability system, which strongly solves the problem of individual departments to shirk their responsibilities, dragging the "strong regulatory This strongly solves the problem of individual departments shirking their responsibilities and dragging "strong supervision" behind.

The sharing and application of upstream and downstream data on the circulation of refined oil products has laid a solid foundation for the subsequent tax-related supervision work. The tax authorities, through the sharing of data across departments, are able to more accurately grasp the production and operation situation of the enterprises, trace the source and flow of oil products, and crack down on the evasion of consumption tax such as "change of invoice" and "over-invoice". The tax authorities can more accurately grasp the production and operation of enterprises through the sharing of data across departments, trace the source and flow of oil products, and combat the "altered invoices" and "over-invoicing" and other consumption tax evasion. Because of this, it also puts forward higher requirements for data management of petrochemical enterprises.

(iv) Strictly prohibit illegal activities such as the operation of gasoline and diesel oil in the name of "new energy"

The opinions of the General Office of the State Council also pointed out that local people's governments at all levels should coordinate the supervision and investigation of illegal behaviors in the circulation of refined oil products, and strictly prohibit the sale of automotive fuels with gasoline or diesel fuel as the main ingredient, which do not meet the requirements of national policies, in the name of "new energy" and "alternative energy". It is strictly prohibited to sell motor fuels with gasoline or diesel as the main component and not in compliance with national policies, and seriously investigated and dealt with behaviors such as substandard oil quality, illegal blending of refined oil products, and sale of off-standard oil products as engine fuels to retailers of refined oil products or engine fuels, etc. It is designated to lead the department to carry out the special remediation of unlicensed and unregistered operation in the field of refined oil products circulation, and to severely crack down on the operation of unregistered and unregistered operation and self-built tanks, mobile refueling trucks (boats), and black refueling stations. The department will strictly crack down on unlicensed operation and self-built fuel tanks, mobile fuel trucks (boats) and black fuel stations.

In practice, there have been cases in which the tax authorities have sampled enterprises' sales of "environmentally friendly mineral oil" to recover consumption tax. Enterprises selling gasoline and diesel oil containing ingredients in the name of "new energy" and "alternative energy" are mostly motivated by the need to avoid administrative supervision and consumption tax. On the one hand, enterprises bypassed the approval of retail operation in the name of "non-product oil" and illegally sold to end-users in order to circumvent the retail license; on the other hand, gasoline and diesel oil are subject to excise tax (gasoline RMB 1.52/liter, diesel oil RMB 1.2/liter), and products such as "environmentally friendly mineral oil" are often sold through vague and ambiguous means. On the other hand, diesel oil is subject to excise tax (gasoline: 1.52 yuan/liter, diesel oil: 1.2 yuan/liter), and "environmentally friendly mineral oil" is often used to avoid paying tax by blurring the name of the product.

It should be noted that the tax authorities do not directly apply the national standards for diesel oil to determine whether a certain oil product is a taxable diesel oil, but rather focus on the characteristics and functions of the oil product. This means that for a certain type of oil, the market department may characterize it as shoddy diesel oil or even dangerous chemicals, but the tax authority may define it as taxable diesel oil according to the policy of consumption tax. The opinion explicitly prohibits the sale of fuels containing gasoline and diesel oil in the name of "new energy" and "alternative energy", which means that such behaviors will be specifically rectified, and it is suggested that the sale of traditional oil in the name of "new energy" and "alternative energy" in the past will be prohibited. It is recommended that enterprises that used to sell traditional oil products under the name of "new energy" or other names should adjust their business model as soon as possible and trace back their historical transactions, so as to avoid incurring tax reimbursement, fines and even criminal liabilities.

III. Conclusion

The introduction of the Opinions on Promoting the High Quality Development of Refined Oil Circulation is not only a deepening of the previous "release of administrative services" reform, but also a sign that the refined oil industry will usher in stricter and more regularized supervision. In the face of new tax-related regulatory requirements, corporate tax compliance should not be delayed. Petrochemical enterprises should strengthen internal management and establish a sound compliance management system. From qualification management to account records, from invoicing to data reporting, enterprises need to ensure that each link meets the requirements. In their operations, petrochemical companies can use digital means to improve management effectiveness, to better respond to data sharing requirements, and to ensure the authenticity and consistency of data.

Frequent policy changes in the circulation of refined oil products, the General Office of the State Council also mentioned in the comments, the Ministry of Commerce is responsible for the development of refined oil products wholesale storage enterprise filing operating guidelines, we look forward to and pay attention to the subsequent operating guidelines, as well as the "refined oil products circulation management approach" of the legislative process. We suggest that petrochemical companies should pay close attention to policy developments and adjust their business strategies in a timely manner. In the face of a complex regulatory environment, the majority of enterprises can seek the support of professional organizations to assist them in tax risk prevention and legal compliance management to ensure sound development in the new regulatory environment.

 

Attachment:

Opinions of the General Office of the State Council on Promoting High-Quality Development of Refined Oil Circulation

State Council [2025] No. 5

People's governments of provinces, autonomous regions and municipalities directly under the Central Government, and the ministries and commissions of the State Council, as well as organizations directly under the Central Government:

Refined petroleum products are basic and strategic resources related to national economy and people's livelihood, and are closely related to the operation of the national economy and people's production and life. In order to further improve the management system for the circulation of refined oil products and promote the high-quality development of the circulation of refined oil products, with the consent of the State Council, the following opinions are put forward.

I. Improvement of the management system for the circulation of refined oil products

(i) Improving the management system for wholesale storage of refined oil products. The implementation of record management for the wholesale storage of refined oil products, enterprises engaged in the wholesale storage of refined oil products, should hold a business license with a business scope that includes the wholesale storage of refined oil products, and obtain a hazardous chemicals business license and a port operating license in accordance with the "Regulations on the Safe Management of Dangerous Chemicals" and other relevant laws and regulations, and apply for a record in the commerce department in accordance with the relevant provisions, and open the refined oil products invoicing in the tax department with the receipt of the record. Module. Refined oil wholesalers and warehouses that have not obtained the hazardous chemicals operation license or port operation license, or whose licenses have expired, shall register the change of business scope of business license in accordance with the law, and shall not be engaged in the activities related to refined oil wholesalers and warehouses before obtaining the licenses. The Ministry of Commerce is responsible for the development of refined oil wholesale storage enterprise filing operating guidelines. The Ministry of Transportation, Commerce, Emergency Management, Taxation, Market Supervision and other departments shall strengthen the comparison and sharing of information related to refined oil wholesale storage enterprises.

(ii) Improving the management system for the retailing of refined oil products. Formulate and strictly implement the national unified access standards for the qualification of retail operation of refined oil products, and the approving department shall enter the licensing results into the relevant information system, disclose them in a timely manner and notify the relevant departments. It is strictly prohibited to alter, sell, lease, lend, or transfer the license to operate refined oil products. Unauthorized alteration and expansion of refined oil retail outlets is strictly prohibited. Establish an annual supervision and inspection system for refined oil retail business enterprises, and order enterprises that do not accept the inspection or fail the inspection to rectify the situation within a certain period of time.

(iii) Improving the enterprise account management system. Supervise enterprises to strictly implement the provisions of refined oil account management, according to the factual accounting and reporting of oil purchases and sales and inventory data, improve the source of refined oil, sales destination, inspection reports, inspection records and other vouchers and materials files, and keep a complete account book for inspection. Implement a real-name registration system for the purchase and sale of bulk gasoline. The organization carries out "double random and open" supervision, focusing on checking the establishment and implementation of the enterprise account system, guiding enterprises to continuously improve the accuracy and timeliness of updating their accounts, and discovering violations of laws and regulations in accordance with the law.

(iv) Improving the enterprise credit management system. Promote the credit grading and classification management of refined oil products business enterprises, combined with the daily supervision of enterprises, the quality of oil products and measurement standards, tax payment in accordance with the law, emergency supply and other circumstances into the corporate credit record, in accordance with the law and regulations on the main body of the non-credit to increase exposure to enhance the effectiveness of credit supervision. Based on the credit situation of enterprises, differentiated measures will be taken in terms of supervisory methods, sampling ratio and frequency.

II. Improving the cross-sectoral regulatory mechanism for the circulation of refined oil products

(v) Establishing local cross-sectoral joint regulatory mechanisms. Local people's governments at all levels shall strictly implement the responsibilities of territorial supervision, establish cross-sectoral joint supervision mechanisms for the circulation of refined oil products, coordinate the allocation of administrative penalty functions and law enforcement resources, clarify the division of responsibilities among the leading supervisory departments, law enforcement departments, and other relevant departments, and specify specific supervisory measures, promote the smooth connection between administrative approval, daily supervision and comprehensive administrative law enforcement, and enhance the ability of cross-sectoral joint supervision and law enforcement collaboration. The following is a summary of the responsibilities and division of labor of the law enforcement departments and all other relevant departments. The people's governments of provinces (autonomous regions and municipalities directly under the central government) shall establish a coordinated contact system for the supervision of the refined oil products circulation industry and administrative law enforcement in the region, and report to the Ministry of Commerce and the General Administration of Market Supervision.

(vi) Strictly implement the relevant requirements of the comprehensive administrative law enforcement reform. Local business law enforcement functions integrated into the market supervision and other integrated law enforcement departments, market supervision and other integrated law enforcement departments to seriously implement the "General Office of the CPC Central Committee, the General Office of the State Council on the deepening of market supervision of the integrated administrative law enforcement reform of the guiding opinions" and other integrated law enforcement reform documents, strengthen the integrated law enforcement inspections, clues found in accordance with the rules and regulations to be investigated and dealt with; business and other competent departments in charge of the industry should be effectively carry out their daily Business and other industry authorities should effectively fulfill their daily regulatory responsibilities, carry out on-site and off-site inspections, and find clues of violations of the law and hand them over in a timely manner. If the law enforcement function of local commerce has not been transferred, the competent departments of commerce and other industries shall be responsible for daily supervision and administrative law enforcement.

(vii) Strengthening the application of upstream and downstream data sharing in the circulation of refined oil products. Regularly collect and share the basic information of enterprises that produce and transport refined oil products, open the invoicing module for refined oil products, include refined oil products in the business scope of the business license, and include refined oil products in the scope of the national industrial product production license, explore the collection of tank level monitoring data, and deepen the sharing of key data on the production and processing of refineries, and the purchase, sale, and inventory of gasoline stations (points). Data and information security management should be effectively strengthened.

(viii) Enhancing the level of digitalized supervision of the circulation of refined oil products. Encourage conditional places to promote the use of big data, Internet of Things and other technical means to promote the construction of intelligent gas stations and big data management systems for the circulation of refined oil products, accelerate the construction of a whole-chain, traceable and dynamic regulatory system covering the wholesale, warehousing, transportation, retail and other links, and enhance the effectiveness of digital supervision and the level of service in the circulation of refined oil products.

III. Strengthening the supervision of key areas of refined oil circulation

(ix) Strengthening production safety supervision. Strictly implement the responsibility for production safety supervision in the circulation of refined oil products. Strengthen the safety supervision of the circulation of refined oil products, guide and supervise the operation of refined oil products and transportation enterprises to establish and improve the production safety management system, risk prevention and control mechanism and hidden trouble investigation and management mechanism, strictly implement the production safety laws and regulations and standards, increase the supervision and inspection of production safety in the circulation of refined oil products, and promote the enterprises to effectively improve the level of production safety management.

(x) Strengthening management of environmental protection standards. Continuously strengthen the supervision and rectification of excessive oil and gas emissions in the distribution of refined oil products. Increase the random inspection of oil and gas recovery systems and online monitoring systems. Strengthen the supervision of leakage of underground storage tanks at gas stations (sites), and ensure that leakage prevention measures such as double-layer tanks or seepage-proof pools and leakage-proof monitoring systems adopted by gas stations (sites) are complete and effective, so as to prevent soil and groundwater from being polluted.

(xi) Strengthening quality and measurement supervision. Strengthen the sampling and inspection of refined oil products, strengthen the traceability of unqualified oil products, and prevent the flow of unqualified oil products into the market. To crack down on illegal and criminal acts of cheating with gasoline dispensers in accordance with the law, strictly implement and continuously optimize and improve the type approval system and metrological verification system of gasoline dispensers, increase the supervision and management of fuel dispensers and other metrological instruments, do a good job in training and publicizing gasoline dispenser verification regulations and type evaluation syllabus, and continue to promote research on the function of gasoline dispensers to prevent cheating and tampering, and to organize the development of test specifications for the deceptive use of software features of gasoline dispensers. The government will continue to promote research on anti-cheating and anti-tampering functions of gasoline dispensers, and organize the formulation of specifications for testing the deceptive use of software features of gasoline dispensers.

(xii) Regulating the sale of refined oil products over the Internet. Strict implementation of the relevant provisions of the safety management of Internet sales of hazardous chemicals, e-commerce platforms shall not provide operators within the platform for the release of information on the sale of refined oil products. Standardize and carry out the qualification license for retail operation of refined oil in an orderly manner to achieve "one-stop one-certificate", and prohibit the issuance of certificates of approval for retail operation of refined oil to the e-commerce platforms; those that have already been issued shall be rectified by the licensing department according to the law within six months from the date of the release of this opinion.

(xiii) crack down on violations of the law. Local people's governments at all levels should coordinate the supervision and investigation of illegal acts in the circulation of refined oil products, and strictly prohibit the sale of motor fuels with gasoline or diesel as the main ingredient that do not comply with national policies in the name of "new energy" or "alternative energy". Seriously investigate and deal with substandard oil quality, illegal blending of refined oil products, selling non-standard oil products as engine fuel to refined oil retailers or engine fuel users, etc., and designate departments to take the lead in carrying out special remediation of unlicensed and unregistered operation in the field of refined oil circulation on a regular basis, and severely crack down on unlicensed and unregistered operation and self-built tanks, mobile refueling trucks (boats), and black refueling stations, etc., which disrupt the market order.

IV. Promoting the modernization and development of the circulation of refined oil products

(xiv) Optimizing the layout of retail outlets. Scientific preparation of the development plan for the retail system of refined oil products, integrated urban and rural development, intensive use of land, and rational distribution of gas station outlets. The construction of gas stations in urban areas and along highways has been planned in an orderly manner, and large-scale backbone enterprises are encouraged to further extend their retail systems to rural and remote areas, so as to meet the oil needs of urban and rural residents.

(xv) Improving the service level of outlets. Accelerate the transformation of the development mode of the circulation of refined oil products, focusing on the protection of market supply, strengthen the key areas, key areas, key gas stations (points) supply capacity building, improve the emergency supply of refined oil measures to ensure the stability of oil supply during important nodes as well as major events, localities can be combined with the actual establishment of the corresponding management regulations. Under the premise of guaranteeing safety, support gas stations to set up convenience stores according to the conditions of the stations, and launch convenient car washing, auto parts repair and maintenance services.

(xvi) Supporting the upgrading of rural gas stations. It implements policies to support the construction of rural gas stations, encourages qualified rural gas stations to be upgraded into gas stations, and ensures the demand for oil for production and daily life in rural areas. Rural gas stations (points) are guided to reasonably expand their non-oil business in the light of the characteristics of rural consumption, so as to comprehensively improve their ability to serve the "three rural areas" and help revitalize the countryside.

(xvii) Promoting the development of chain operation of refined oil retail enterprises. Promote the development of refined oil retail enterprises into specialized, vertical chain brand enterprises, and encourage small and medium-sized gas stations (points) to realize unified procurement, unified distribution and unified management through hosting, leasing and joint ventures in accordance with the law, so as to enhance the level of branding and chaining. In conjunction with the annual inspection of enterprises, the relevant information of refined oil wholesaling, warehousing and retailing enterprises with standardized operation and management, complete equipment and facilities, and good business conditions and credit will be publicized to support high-quality enterprises to become bigger and stronger, and to promote large-scale and standardized development.

(xviii) Accelerating green and low-carbon transformation and development. Do a good job in the circulation of refined oil products, oil and gas recycling and control and prevention of groundwater pollution at gas stations. It supports the research and development of new technologies and equipment by refined oil companies, and improves the level of safety, environmental protection and resource utilization. Promote the upgrading of the quality of refined oil products and the development of clean alternative energy, study and formulate policies on the circulation management of green and clean fuels such as biodiesel, etc., whose application is encouraged by the state and for which national mandatory standards have been issued, so as to help build a modern energy system that is clean, low-carbon, safe and efficient. Further standardize the market order of biofuel ethanol and automotive ethanol gasoline.

V. Safeguards

(xix) strengthen organizational leadership. All regions and departments should effectively raise the political position, resolutely implement the CPC Central Committee, the State Council decision-making and deployment, conscientiously implement the good territorial and sectoral regulatory responsibilities, strengthen coordination, improve the working mechanism, a clear division of responsibilities, in accordance with the law and regulations in the performance of their duties and responsibilities, to further improve the management system for the circulation of refined oil products, and strive to promote the circulation of refined oil products to standardize the high-quality development of an orderly manner. The Ministry of Commerce shall strengthen coordination and promote the implementation of this opinion in conjunction with all relevant departments.

(xx) Improving incentive and constraint mechanisms. Regions can co-ordinate the use of existing funding channels to support government departments to strengthen the management of big data and the sharing of regulatory information and applications, and further improve government governance capacity. To summarize and promote advanced experience and innovative practices in a timely manner, to promote ineffective, delayed progress of the typical cases of notification of interviews, ordered to rectify, to ensure that the tasks and measures are put in place.

(xxi) Create a favorable development environment. We will strengthen publicity and guidance, do a good job of policy interpretation, and respond to the concerns of society and enterprises. It will actively organize and carry out training on the management of refined oil product circulation, strengthen collaboration and exchanges among regions and relevant departments, and continuously improve management and service levels. Give full play to the role of industry organizations in the protection of rights and interests, dispute handling, industry credit construction and credit supervision, etc., and guide them to establish and improve industry business norms and self-discipline conventions to regulate corporate behavior.

State Council Office of the People's Republic of China

January 27, 2025