China Expands Crossborder Ecommerce to 22 New Zones

Premier Li Keqiang announced the decision to establish new pilot zones for CBEC in 22 cities in China at the executive meeting of State Council held on July 13, 2018. New cities are: Beijing, Huhehaote, Shenyang, Changchun, Haerbin, Nanjing, Nanchang, Wuhan, Changsha, Nanning, Haikou, Guiyang, Kunming, Xi’an, Lanzhou, Xiamen, Tangshan, Wuxi, Weihai, Zhuhai, Dongguan, Yiwu.

In April, 2016, “Notice on Tax Policy on Crossborder Ecommerce Retail Imports” became effective along with two “Lists of Imported Commodities in Crossborder Ecommerce Retail” (the positive lists). In addition to the new restrictions imposed by these new requirements, ecommerce retailers are also required to obtain a customs clearance form issued by inspection and quarantine organizations before customs declaration. Due to the unexpected nature of these administrative changes, retailers were largely unprepared to meet new demands. Given the important role this trade channel has in driving consumption in China’s new economy, authorities in an effort to minimize the impact on the fledgling industry offered an initial grace period of 1 year and then extended a further 2 times until the end of 2018.  

During the grace period, crossborder ecommerce stakeholders are exempt from requirements requiring provision of the customs clearance form and import license, registration or filing of cosmetics, infant formula, medical devices and specialty foods.

Hangzhou Crossborder Ecommerce Pilot Area has seen a significant growth in imported commodity value, from 2.7 billion yuan in 2014 and 2015 to 10 billion in 2016 and 2017.

Days ago, in an official document titled “Advice on Increasing Imports and Promoting Balanced Foreign Trade”, authorities called for release of a detailed supervision plan and also the amendment of the CBEC positive list. It is important to note the 2.5-year transition period will come to an end in 5 months. (See Chemlinked News)