The **Regulations on the Management of Commercial Reserves of Fertilizers** will come into effect on September 1

Thread Content

The “Measures for the Management of Commercial Reserves of Chemical Fertilizers” came into effect on September 1. Author/Source: Sinochem News. Date: August 3, 2020. Page views: 110. On July 31, the National Development and Reform Commission and the Ministry of Finance jointly issued the “Measures for the Management of Commercial Reserves of Chemical Fertilizers”. The former categories of “Central Disaster Relief Fertilizer Reserve,” “Fertilizer Commercial Reserve during Off-Seasons,” and “**Potash Fertilizer Reserve” have been merged into “**Fertilizer Commercial Reserve.” 　　The Measures stipulate that **commercial fertilizer reserves are divided into three categories: potassium fertilizer reserves, disaster-relief fertilizer reserves, and spring plowing fertilizer reserves. Among them, potassium fertilizer reserves consist of a single type of fertilizer, while the disaster-relief and spring plowing fertilizer reserves include only nitrogen-based fertilizers, phosphorus-based fertilizers, and compound fertilizers. 　　**The total scale of commercial reserves for chemical fertilizers is determined by taking into account domestic production and demand for such fertilizers, as well as import and export trends, and is dynamically adjusted at the end of each storage period. 　　The reserve volumes of disaster-relief fertilizers and spring-plowing fertilizers are adjusted in light of the latest annual changes in the application volume of agricultural fertilizers as announced by the **Statistics Bureau. 　　The scale of potassium fertilizer reserves is adjusted based on the needs for emergency fertilizers and those required for spring plowing, and once it reaches a certain level, it remains stable. 　　According to the regulations, the storage period for potash fertilizer in each cycle is 4 years, with the annual storage period running from May 1 of the current year to April 30 of the following year. The responsibility period for each round of reserve disaster relief fertilizers is 4 years, with the annual reserve period being from May 1 to October 31 of each year. The responsibility period for storing fertilizer for spring plowing is 2 years per cycle, and the annual storage period can be chosen by the storing enterprise as any consecutive 6 months between September 1 of the current year and April 30 of the following year. 　　In the task of preparing fertilizers for spring plowing in major grain-producing areas, nitrogen fertilizers should account for no less than 40% of the total amount of fertilizers stored in those areas (this proportion can be reduced to 30% in the three provinces in Northeast China and the Inner Mongolia Autonomous Region); in other areas, compound fertilizers should account for no more than 70% of the total amount of fertilizers stored there. 　　The regulations stipulate that all entities responsible for storage will be selected through bidding processes. Enterprises voluntarily take on the storage tasks and are responsible for their own profits and losses. The necessary funds can be obtained through loans from institutions such as the Agricultural Development Bank of China, with financial subsidies provided by the central government. **Regulations on the Management of Commercial Reserves of Fertilizers Chapter 1 General Provisions Article 1 These regulations are formulated to ensure a stable supply of fertilizers for spring plowing and stable prices, to safeguard the domestic supply of potash fertilizers, and to meet the needs for emergency fertilizer use after disasters, thereby facilitating the proper management of commercial reserves of **fertilizers. 　　Article 2 These measures apply to the management of **commercial fertilizer reserves, as well as the selection, supervision, and evaluation of enterprises responsible for storing such reserves. 　　Article 3 **The commercial storage of chemical fertilizers follows the basic principles of enterprise-based storage, subsidies, market operation, and self-responsibility for profits and losses.** 　　Article 4 **Commercial fertilizer reserves are divided into three categories: potassium fertilizer reserves, disaster relief fertilizer reserves, and spring plowing fertilizer reserves. Among them, potassium fertilizer reserves consist of only one type of fertilizer, while the disaster relief and spring plowing fertilizer reserves include only nitrogen-based fertilizers, phosphorus-based fertilizers, and compound fertilizers. 　　Article 5: The Development and Reform Commission and the Ministry of Finance are responsible for the overall management of commercial fertilizer reserves. The relevant regulatory agencies under the Ministry of Finance are tasked with reviewing matters such as the storage arrangements by enterprises and the allocation of financial subsidies. The development and reform commissions and finance departments (bureaus) of the respective provinces (regions, municipalities) are responsible for monitoring the situation regarding fertilizers used for spring plowing within their respective areas, both during and after the implementation process. 　　Article 6 **The task of maintaining commercial reserves of chemical fertilizers shall be undertaken voluntarily by enterprises, which shall bear the associated profits and losses. The necessary funds can be obtained through loans from institutions such as the Agricultural Development Bank of China, with financial subsidies provided by the central government. 　　Chapter 2 Reserve Scale Article 7 The **Development and Reform Commission, in conjunction with the Ministry of Finance, determines** the total scale of commercial fertilizer reserves. 　　Article 8 **The total scale of commercial reserves for chemical fertilizers is determined by taking into account domestic production and demand for such fertilizers, as well as import and export trends, and is adjusted dynamically at the end of each storage period. 　　The reserve volumes of disaster-relief fertilizers and spring-plowing fertilizers are adjusted in light of the latest annual changes in the application volume of agricultural fertilizers as announced by the **Statistics Bureau. 　　The scale of potassium fertilizer reserves is adjusted based on the needs for emergency fertilizers and those required for spring plowing, and once it reaches a certain level, it remains stable. 　　Article 9 **The proportion of imported fertilizers in the commercial reserve of chemical fertilizers shall be determined by the Development and Reform Commission in conjunction with the Ministry of Finance, based on the conditions of the domestic and international fertilizer markets.** 　　Chapter 3: Reserve Period and Arrangements Article 10: The responsibility period for each round of potassium fertilizer reserves is 4 years; the annual reserve period runs from May 1 of a given year to April 30 of the following year. The responsibility period for each round of reserve storage of disaster relief fertilizers is 4 years, with the annual storage period being from May 1 to October 31 of each year. The responsibility period for storing fertilizers for spring plowing is 2 years per cycle, and the annual storage period can be chosen by the storing enterprise as any consecutive 6 months between September 1 of the current year and April 30 of the following year. 　　Article 11: The layout for the storage of potassium fertilizers and emergency relief fertilizers shall be determined independently by the storage enterprises in accordance with the following principles. 　　(1) The reserves of potassium fertilizers should be primarily located in areas with convenient transportation or in major grain and cotton-producing regions; all reserve storage sites must be situated within China’s customs territory. 　　(II) The reserve of disaster relief fertilizers is allocated with emphasis on areas prone to disasters and major grain-producing regions, in line with the patterns of natural disasters such as floods and typhoons. 　　Article 12: The storage of fertilizers for spring plowing is arranged on a provincial (regional, municipal) basis. The **Development and Reform Commission and the Ministry of Finance, in consultation with the Ministry of Agriculture and Rural Affairs and the All-China Supply and Marketing Cooperative Federation, determine such arrangements based on the overall situation of the national fertilizer market and regulatory requirements, taking into account factors such as the amount of fertilizer used in agriculture in various regions and the capacity for fertilizer production and transportation. The companies responsible for storage then select appropriate locations for storage and sales within the areas they have been awarded to operate in. 　　In the task of preparing fertilizers for spring plowing in major grain-producing areas, nitrogen fertilizers should account for no less than 40% of the total amount of fertilizers to be stored in those regions (this proportion can be reduced to 30% in the three provinces in Northeast China and the Inner Mongolia Autonomous Region); in other regions, compound fertilizers should account for no more than 70% of the total amount of fertilizers to be stored. 　　Chapter 4: Basic Requirements and Selection Methods for Enterprises Undertaking Storage Article 13: **Enterprises that undertake the commercial storage of chemical fertilizers must meet the following basic requirements: (1) They must have the qualifications to produce and distribute chemical fertilizers within the country, as well as the ability to assume civil liability independently, and their operations must be functioning properly. 　　(II) The actually paid-in registered capital shall be no less than 50 million RMB. In the case of a consortium of enterprises (fertilizer producers and distributors may form such a consortium), the leading enterprise must have an actually paid-in registered capital of no less than 200 million RMB in the previous year, while each participating enterprise must have an actually paid-in registered capital of no less than 30 million RMB in the previous year. For enterprises in the Tibet Autonomous Region, Qinghai Province, Gansu Province, and Ningxia Hui Autonomous Region that are tasked with storing reserves for their own provinces/regions or for the aforementioned other provinces/regions, their actual registered capital paid up in the previous year must be no less than 10 million RMB. 　　(III) Fertilizer distribution companies must have an average annual sales volume of over 300,000 tons in the past three years; fertilizer production companies must possess a sales network, with an average annual output of over 400,000 tons of elemental fertilizers or over 800,000 tons of compound fertilizers in the past three years. The total number of enterprises participating in the consortium must meet the above conditions. When enterprises in the Tibet Autonomous Region, Qinghai Province, Gansu Province, and Ningxia Hui Autonomous Region undertake storage tasks for their own provinces/regions or for the aforementioned other provinces/regions, the conditions may be relaxed as appropriate. 　　(IV) Enterprises that store disaster relief fertilizers and potassium fertilizers must have a well-developed distribution network in riverine and coastal areas, and must be state-owned or non-state-owned trading enterprises for fertilizer imports. 　　(5) The fertilizer storage enterprise for spring plowing must have had an average annual sales volume within the target area over the past three years that is not less than 1.2 times its bid volume. 　　(VI) Fertilizer manufacturers must comply with the provisions of **industrial policies, their products must meet **quality standards, and their energy consumption must satisfy **relevant requirements; fertilizer distributors shall purchase fertilizers that are produced by such manufacturers or that meet **customs inspection standards. 　　(7) Possess warehousing capacity that meets the requirements of the storage scale and regional layout. 　　(VIII) In carrying out tasks related to the former “Central Reserve of Fertilizers for Disaster Relief”, “Commercial Reserve of Fertilizers during the Off-Season”, “**Potassium Fertilizer Reserve”, or other provincial-level fertilizer reserve programs, the entity has never been penalized by relevant authorities for acts such as fraud aimed at obtaining subsidy funds. 　　(IX) The bank has a good reputation. 　　Article 14 The Development and Reform Commission and the Ministry of Finance entrust bidding agencies to determine the enterprises responsible for holding commercial fertilizer reserves in accordance with the principles of openness, fairness, and impartiality, through methods such as public bidding or invited bidding as provided by law. 　　Article 15: The procurement for the reserves of potash fertilizers and disaster-relief fertilizers shall be conducted through a joint tender based on the total reserve volume. A single enterprise shall be designated as the storage entity; the winning bidder will be responsible for both reserve tasks. The tender is held every four years. According to the bidding evaluation rankings, the top 3 candidates are selected in principle. When the total amount requested by these top 3 candidates does not exceed the total reserve capacity, the reserve assignments are allocated based on their respective requests, while any remaining reserve capacity is assigned in order according to their evaluation scores. If the total amount requested by the top 3 candidates equals or exceeds the total reserve capacity, then their reserve assignments are determined based on the proportion of their evaluation scores. 　　Article 16: In the Tibet Autonomous Region, Qinghai Province, Gansu Province, and Ningxia Hui Autonomous Region, the quantity of fertilizer reserved for spring plowing shall not exceed 20,000 tons per location; in other regions, this amount is generally 50,000 tons per location. Tendering is conducted every 2 years in all cases. 　　Article 17: The tender announcement shall be published on relevant platforms such as the China Public Service Platform for Bidding and Tendering and national fertilizer-specific websites. The list of shortlisted companies is published in the media where the tender announcement was issued. 　　Article 18: The winning bidder shall undertake the storage tasks during the storage responsibility period (4 years for potash fertilizer and disaster relief fertilizer, and 2 years for spring plowing fertilizer; the same applies hereafter). Upon the expiration of this period, a new bidding process will be conducted to determine the bidder for the next period. 　　Chapter 5: Assignment and Management of Reserve Tasks
Article 19: The National Development and Reform Commission and the Ministry of Finance shall assign reserve tasks based on the bidding results, specifying details such as the names of the winning enterprises, types of goods to be stockpiled, and quantities required. Copies of these documents shall be sent to the Ministry of Industry and Information Technology, the Ministry of Agriculture and Rural Affairs, the All-China Federation of Supply and Marketing Cooperatives, the Agricultural Development Bank of China, China State Railway Group, and the relevant regulatory bureaus under the Ministry of Finance. Among them: (1) The task of preparing fertilizers for spring plowing is assigned to the development and reform commissions and finance departments (bureaus) of the relevant provinces (regions, municipalities); these agencies then promptly inform the winning bid enterprises. 　　(II) The tasks related to the stockpiling of potassium fertilizers and emergency fertilizers are assigned directly to the winning bid enterprises. 　　Article 20 **Enterprises responsible for storing commercial fertilizer reserves shall separate such reserves from other policy-based reserves and corporate inventory by using distinct areas or stacks, and label them accordingly; the storage warehouses shall be marked with the indication “**Commercial Fertilizer Reserve Warehouse (Potash Fertilizer/Disaster Relief Fertilizer/Spring Plowing Fertilizer).” After potassium fertilizers and emergency fertilizers are released during the annual stocking period, it is necessary to replenish the inventory in a timely manner in accordance with the specified time requirements. When emergency fertilizers are distributed, they should be labeled with the indication “**Commercially stocked emergency fertilizer**”. 　　Article 21: During the annual reserve period, in case of macro-control requirements or special circumstances such as major natural disasters, **relevant enterprises may be designated to have priority in purchasing the reserved fertilizers; the enterprises responsible for storing these fertilizers must ensure an adequate supply and deliver them in a timely manner. The Ministry of Finance allocates subsidy funds to the storage enterprises based on the actual storage period. 　　Article 22: Potassium fertilizer storage enterprises shall determine the timing for inventory rotation on their own and replenish the inventory within 30 working days. 　　Article 23: When applying to utilize disaster-relief fertilizers, the development and reform commissions of relevant provinces (autonomous regions and municipalities) shall, in conjunction with agricultural and rural affairs departments, submit an application for utilization to the **National Development and Reform Commission** based on the impact of disasters such as floods and typhoons on local agricultural production. The **National Development and Reform Commission** shall promptly issue instructions to storage enterprises regarding the distribution of disaster-relief fertilizers; it may also release a portion of its potassium fertilizer reserves according to local disaster relief needs. The storage enterprise shall mobilize the disaster relief fertilizer and dispatch it within 3 days of receiving the dispatch notice, ensuring its prompt delivery, and then replenish the inventory within 15 working days. 　　Article 24: The prices at which nitrogen fertilizers, phosphorus fertilizers, and compound fertilizers are supplied in disaster areas during their annual reserve period, as well as the prices at which potassium fertilizers are supplied there due to disaster relief needs, shall be determined by averaging the relevant fertilizer prices listed in the latest report on price changes of key production materials in the distribution sector issued by the **Statistics Bureau, along with the average wholesale prices of such fertilizers as monitored most recently by the General Supply and Marketing Cooperative Federation. 　　Article 25 **Commercial reserves of chemical fertilizers shall be used solely to meet the needs of domestic agricultural production and shall not be used for export. 　　Chapter 6: Fulfillment of Reserve Tasks and Assessment Article 26: If a company designated to store fertilizers for spring plowing fails to complete its reserve tasks within the designated annual period, the development and reform commission and the finance department of the province (region, city) where it is located shall revoke that company’s responsibility for storing fertilizers. The relevant details shall be included in the reports submitted to the **Development and Reform Commission and the Ministry of Finance after the end of the annual reserve period. For the reserve allocation tasks that were not completed in the first year of the storage responsibility period, **the Development and Reform Commission and the Ministry of Finance may arrange for those unfinished tasks to be allocated again within the same region in the second year of the storage responsibility period, taking into account the rankings from the most recent bidding process; if it is not possible to allocate them within the same region, they can be assigned to a neighboring region. 　　If the enterprises responsible for storing potassium fertilizers and emergency relief fertilizers fail to complete any of their storage tasks within the designated annual period, **the Development and Reform Commission and the Ministry of Finance may reassign those unfinished storage tasks, as well as any other related storage tasks, based on the results of the most recent bidding process. 　　Article 27: Fertilizer storage enterprises for spring plowing are evaluated each year based on the following criteria: (1) During the annual storage period, the total amount of chemical fertilizers brought into the designated area must be no less than 1.2 times the storage quota assigned for that year. 　　(II) The inventory level at the end of the fourth month within the annual reserve period shall be no less than 50% of the assigned storage target. At the end of the fifth and sixth months, the inventory level must be no less than 80% of the storage target; in one of these months, the inventory level must be no less than 110% of that target. The specific month(s) are determined by the storage company itself, and such determination must be reported to the development and reform commission and the finance department of the respective province (region/municipality) by the end of the fourth month. Once determined, it cannot be changed during the annual storage period. 　　(III) The amount transferred in by manufacturing enterprises refers to the quantity of fertilizers produced within the storage area or in that area whose ownership has not been transferred; the inventory level represents the total quantity of fertilizers stored by the enterprise at various locations within the storage area (including the factory premises). If the manufacturing enterprise is located outside the target area, the inventory quantity on its premises shall not be included in the total inventory amount. 　　(IV) If the storage enterprise stores multiple varieties, assessments shall be conducted separately for each variety. If the assessment for a single variety fails, it is regarded as a failure in the assessment of all storage tasks. 　　Article 28: Enterprises responsible for storing potassium fertilizers and disaster-relief fertilizers shall be evaluated based on whether their average daily inventory during the annual storage period is not less than the assigned storage quota. 　　Chapter 7: Management of Reserve Financial Resources
Article 29: Enterprises responsible for storing spring planting fertilizers may apply to institutions such as the Agricultural Development Bank of China for loan support to meet their funding needs. While adhering to credit policies and ensuring compliant lending practices, banks provide favorable and convenient credit support based on the risk tolerance of the enterprises responsible for storage, in accordance with the annual storage period, whereby such enterprises repay the principal and interest on time. The Agricultural Development Bank of China provides policy-based credit support to enterprises that store potassium fertilizers and emergency fertilizers. 　　Article 30 The central government shall provide financial subsidies in accordance with the following standards. 　　(1) A fixed amount of subsidy will be provided to enterprises that store potassium fertilizers; the subsidy rate will be set at the lowest bid among the winning enterprises and shall not exceed the current level. 　　(II) Interest subsidy grants shall be provided to enterprises that store disaster relief fertilizers and fertilizers for spring plowing; the subsidy rates are determined based on the value of the stored goods, the storage period, and 50% or 100% of the 1-year interest rate in the loan market, respectively. 　　Article 31: The unit value of nitrogen fertilizers, phosphate fertilizers, and compound fertilizers designated for disaster relief purposes is determined by taking the average price of these fertilizers as published in each issue of the “Market Price Fluctuations of Important Production Materials in the Circulation Sector” released by the **Statistics Bureau during the annual reserve period, as well as the average wholesale prices monitored by the All-China Federation of Supply and Marketing Cooperatives during the same period; these figures are then averaged once more to arrive at the final unit value. For the fertilizers intended for spring plowing, their unit values are calculated based on the same criteria used for disaster relief fertilizers, with the addition of reasonable storage, transportation, and miscellaneous costs that do not exceed current market levels. 　　Article 32: Within 30 working days after the end of the annual reserve period, the enterprise responsible for storing the reserves shall submit to the relevant authorities the various certificates required for applying for subsidy funds, such as purchase invoices for fertilizers, inventory records, and transportation documents, and shall be responsible for the authenticity of these documents. Among them: (1) Enterprises responsible for storing disaster relief fertilizers and potassium fertilizers shall submit reports to the Ministry of Finance, with a copy sent to the Beijing Regulatory Bureau of the Ministry of Finance. 　　(II) Enterprises responsible for storing spring plowing fertilizers shall report to the finance department (bureau) of their respective province (autonomous region or municipality), with a copy sent to the local regulatory bureau of the Ministry of Finance. 　　After receiving the relevant materials from the enterprises responsible for storing fertilizers for spring plowing, the finance departments of the relevant provinces (regions, municipalities) shall submit the consolidated applications for subsidy funds in the form of official documents to the Ministry of Finance within 30 working days. 　　Article 33: The financial authorities allocate subsidy funds for commercial fertilizer reserves in accordance with relevant regulations such as the Budget Law. Subsidy funds for central enterprises are disbursed directly by the Ministry of Finance, while subsidy funds for local enterprises are transferred by the central government through local financial authorities. After receiving the subsidy funds allocated by the central government, local finances must transfer these funds to the enterprises responsible for storing them within 30 days; they are not allowed to delay, hold back, or divert the interest-subsidized funds, and must be subject to the supervision of the local regulatory agency under the Ministry of Finance. 　　Chapter 8 Supervision and Management of Reserves Article 34 Once the reserve management process begins, each enterprise responsible for holding reserves must, within 10 working days before the end of each month, submit reports on the status of those reserves to the relevant authorities, based on the reserve tasks assigned to it. Among them: (1) Enterprises responsible for storing potassium fertilizers and fertilizers for disaster relief shall submit reports to the Beijing Supervision Bureau of the Ministry of Finance, while also sending copies to the **Development and Reform Commission, the Ministry of Finance, or the agencies designated by these two departments, as well as the Ministry of Agriculture and Rural Affairs and the lending banks. 　　(II) The enterprises responsible for storing the fertilizers used in spring plowing shall submit reports to the local regulatory authority of the Ministry of Finance, and at the same time send copies to the development and reform commission and the finance department (bureau) of the province (region/municipality) where they are located, or to the institutions designated by these two agencies, as well as to the department (committee) in charge of agriculture and rural affairs, the supply and marketing cooperatives, and the banking institution that provided the loans. 　　Article 35: Within 10 working days after half of the annual reserve period has passed and after the period comes to an end, the enterprise responsible for storing the reserves shall prepare a **Report on Commercial Fertilizer Reserve Operations based on the status of those reserves, and submit it to the relevant authorities. Among them: (1) Enterprises responsible for storing disaster relief fertilizers and potassium fertilizers shall submit reports to the **Development and Reform Commission and the Ministry of Finance, with a copy sent to the Beijing Regulatory Bureau of the Ministry of Finance. 　　(II) Enterprises responsible for storing spring plowing fertilizers shall report to the Development and Reform Commission and the Department of Finance (Bureau) of their respective provinces (autonomous regions, municipalities), with a copy sent to the local regulatory bureau of the Ministry of Finance. Subsequently, the local provincial development and reform commissions and finance departments (bureaus) shall, within 10 working days, compile the aggregated information from their respective provinces/autonomous regions and submit it to the **National Development and Reform Commission and the Ministry of Finance. 　　Article 36 **A supervision mechanism for the ongoing and post-establishment phase of commercial fertilizer reserves shall be established. 　　(1) The Development and Reform Commission and the Ministry of Finance, in conjunction with the General Supply and Marketing Cooperative Federation and the lending banks, are responsible for overseeing the reserves of potash fertilizer and fertilizer for disaster relief; during the 4-year period of responsibility for managing these reserves, they ensure supervision and inspection of all storage sites. 　　(II) The development and reform commissions and finance departments (bureaus) of the relevant provinces (autonomous regions, municipalities) shall, in conjunction with the supply and marketing cooperatives and lending banks, be responsible for supervising the reserves of spring-plowing fertilizers in their respective regions. Within the two-year period of responsibility for reserve management, they must conduct supervision and inspections of all reserve storage sites; such inspections shall commence after half of the annual spring-plowing fertilizer reserve period has elapsed. At the same time, relevant industry associations or industry experts can be invited to participate in the inspections, and a signing confirmation mechanism involving an expert panel for inspection results, local authorities, and the storage enterprises can be established. 　　(III) Within 40 working days after the end of the annual reserve period for spring plowing fertilizers, the development and reform commissions and finance departments (bureaus) of relevant provinces (autonomous regions and municipalities) shall compile and submit to the **National Development and Reform Commission and the Ministry of Finance information regarding supervision and inspections conducted during the reserve period, as well as any decisions to revoke the reserve obligations of local enterprises. A copy of this report shall also be sent to the All-China Federation of Supply and Marketing Cooperatives and the local regulatory bureau of the Ministry of Finance. 　　Article 37 After the end of each storage obligation period (4 years for potassium fertilizer and disaster-relief fertilizer, and 2 years for spring plowing fertilizer), the relevant supervisory bureaus of the Ministry of Finance shall conduct an audit of the enterprises’ storage practices and the disbursement of funds. Among them: (1) The Beijing Regulatory Bureau of the Ministry of Finance is responsible for reviewing the enterprises that store disaster relief fertilizers and potash fertilizers. 　　(II) The local regulatory bureau of the Ministry of Finance is responsible for reviewing the enterprises that store fertilizers for spring plowing in its respective region. 　　After the relevant regulatory bureau of the Ministry of Finance completes the review, it shall promptly report the review results to the Ministry of Finance, which will then settle the disbursement of funds based on those results. 　　Article 38: If, during the annual reserve period, the storage enterprises experience any of the following situations other than force majeure, it shall be deemed that they have failed to fulfill their reserve obligations; the central government will not provide financial subsidies, and any funds that have already been allocated will be recovered. Such enterprises shall not be allowed to participate in **fertilizer commercial reserve tasks for three bidding periods. 　　(1) Change the types and quantities of reserves, as well as the division of roles among consortium members and their respective storage proportions. 　　(II) Failing to submit the required reserve data, information, and application materials for financial subsidies. 　　(III) It is determined that the reported data and information significantly do not match the actual situation. 　　(IV) The assessment targets have not been met. 　　Article 39: If a storage enterprise falls under any of the following circumstances, the central government will refuse to provide financial subsidies; any funds that have already been allocated will be recovered, and such enterprises shall not be allowed to participate in **fertilizer commercial reserve tasks anymore. The relevant actions will be referred to the appropriate authorities for handling in accordance with laws and regulations. 　　(1) Engaging in fraud and other such practices to defraud reserve subsidy funds. 　　(II) Using reserve loans for other purposes. 　　(III) The reserve fertilizers put on the market have been tested by relevant authorities as fake and substandard fertilizers, and their actual nutrient content and weight do not meet the standards. 　　Article 40: The formats for the relevant materials, forms, and reports that the storage enterprises and various relevant departments are required to submit on schedule shall be uniformly formulated and issued by the **Development and Reform Commission and the Ministry of Finance. 　　Chapter 9 Supplementary Provisions Article 41 These measures shall be interpreted by the **Development and Reform Commission and the Ministry of Finance. 　　Local areas may formulate specific implementation rules or plans based on their own actual conditions. 　　Article 42 These Provisions shall come into force as of September 1, 2020.