Chinese Customs Strengthens Supervision of Cross Border E-commerce Trade

Takehome message:

• General Administration of Customs issue announcement NO. 56 2014 to Strengthens Supervision of Cross Border E-commerce Trade.
• Announcement NO. 57 2014 stipulates that Code 1210 will be added as one of the customs regulatory control methods.

Announcement NO. 56 2014, issued by General Administration of Customs on July 23 2014, came into force on August 1st 2014. This announcement states that e-commerce enterprises or individuals that undertake cross-border trade through e-commerce platforms approved by the Customs and connected to the Customs should be subject to supervision and control by Customs in accordance with the provisions.

According to the announcement, “e-commerce enterprises” refers to both domestic enterprises that conduct cross-border e-commerce business by building or using third-party e-commerce platforms and enterprises that provide third-party e-commerce platforms for cross-border trade. “Individuals” refers to domestic residents. Furthermore, the announcement explicitly stipulates that goods and articles are subject to different regulatory supervisions.

The main points can be summarized as below:

• All enterprises conducting e-commerce business are required to register with the Customs in accordance with regulations specified in the Customs registration guidance in the event that declarations need to be made
• E-commerce enterprises are required to file a record with the Customs about the information of inbound or outbound goods or articles including 10-digit customs commodity code of goods and 8-digit tax code of articles in advance
• E-commerce enterprises, individuals, payment companies, operators of customs supervision areas or logistics enterprises must timely transmit data of transaction, payment, warehouse and logistics to E-commerce Clearance Management Platform through E-commerce Clearance Service Platform.
• E-commerce enterprises must submit the Declaration for Imports & Exports consisting of separate lists of inbound and outbound goods to the Customs within the first 10 days of every month
• The examination and release of the goods or articles should be completed in the customs supervision areas. E-commerce enterprises are subject to post-entry surveillance by the Customs.

Just six days after the issuance of the Announcement NO. 56, 2014, General Administration of Customs unexpectedly promulgated Announcement NO. 57 2014.

The announcement stipulates:

• Code 1210, “bonded e-commerce for cross-border trade”, will be added as one of the customs regulatory control methods. Code 1210 is applicable to all the retailed inbound or outbound merchandises that are traded by e-commerce enterprises or individuals through e-commerce platforms approved by the Customs and are transported in and out of special customs supervision areas or bonded supervision areas.
• E-commerce enterprises conducting e-tailing cross-border trade through Code 1210, E-commerce enterprises of cross-border trade in the special customs supervision areas or bonded supervision areas, payment companies, or logistics enterprises are required to file a record with the Customs, and must transmit data of transaction, payment, warehouse and logistics through e-commerce platforms.