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September 29, 2017

Changes to China cross-border e-commerce rules on hold

A revised tariff for cross-border e-commerce has been extended by China’s State Council for an extra year enabling food and supplement importers to save on duty.

A revised tariff for cross-border e-commerce has been extended by China’s State Council for an extra year enabling food and supplement importers to save on duty.

China had planned the implementation of more stringent rules for e-commerce from 1 January but authorities have extended a transitional tariff policy for cross-border e-commerce retailers until the end of 2018.

This means many goods will still be regarded as personal trade as opposed to commercial distribution, allowing importers to save import duties and bypass cumbersome registration processes.

The State Council also said China will build more e-commerce pilot areas in a number of suitable cities, as well as encourage the construction of foreign trade infrastructure, including warehouses in key markets.

It also announced “increased regulatory innovation for risk prevention and consumer rights protection mechanisms to combat trade in fake goods and shoddy behaviour” after a series of scandals involving the online importation of fake food and supplement products prompted the initial call for tighter regulations.

The extension of the transitional tariff policy has been greeted with relief by supplement companies in Australia and New Zealand such as Blackmores, as well as industry association Complementary Medicines Australia.

It had been speculated that a tightening of Chinese regulations would have prevented some of their products being sold in the cross-border e-commerce channels.

The regulatory changes, which include higher tariffs, the need for customs clearance certification and a “positive list” for goods allowed for cross-border e-commerce, had first been announced in April 2016 but encountered intense lobbying by China’s major online retailers, including Alibaba and JD.com.

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