Boost for Cross Boarder E-commerce in China: Guangzhou Implements Announcement NO.56-2014

The promulgation of Announcement No. 56-2014 by the General Administration of Customs of the People’s Republic of China is significant for both e-commerce business owners and other affected entities. Currently, there are six pilot cities that have been approved for the cross-border e-commerce project: Shanghai, Hangzhou, Ningbo, Zhengzhou, Guangzhou and Chongqing. Local authorities of the six cities are actively engaged in discussions regarding interpretation and implementation of the Announcement. And Guangzhou, one of the pilot cities has made a significant breakthrough turning what’s on paper into practice.

The Guangzhou Customs, after carefully studying the status quo of cross-border e-commerce business in China, will revamp the system in three major areas as below:

1. E-commerce Enterprise:  Simplified Procedures of Record Filling

Guangzhou Customs revealed that cross-border e-commerce business such as Tmall International are no longer required to file record of the company but are now only required to record products with the Customs. This implies that the Customs has lowered the bar for companies or individuals who want to set up cross-border e-commerce business. Moreover, companies will submit directly to the Customs the information such as ordering and payment, which significantly improves the efficiency of customs clearance.

2. Payment Company:  Need to Fill A Record with Local Customs

Payment companies play an important role in e-commerce. Customs requires a record to be filled by payment companies and payment information needs to be submitted directly to Customs. The biggest benefit is that e-commerce enterprises do not need to submit their IDs to the Customs if they use payment companies who have records with the Customs such as Alipay. This simplifies the procedure of cross-border trade for both e-commerce enterprises and buyers. Moreover, it enables Customs to verify buyers’ identification through payment information which greatly improves the supervision and standardization of e-commerce business.   

3. Logistics Enterprise: A New Role to Accelerate the Development of E-Commerce

Logistics is also extremely important for e-commerce. The new announcement stipulates that logistics enterprises must submit logistic information to Customs Clearance System before declaration of any cross-border goods.

The collaboration of e-commerce enterprises, payment companies, logistics enterprises and supervisory authorities will significantly improve the entire cross-border e-commerce system.