'Complete regulatory system': Chinese officials confirm shake-up of cross-border e-commerce rules

The new e-commerce laws will come into effect on January 1, 2019.

The rules were adopted after a fourth reading at the bimonthly session of the Standing Committee of the National People’s Congress that ended last Friday.

The new law requires e-commerce sites to abide by import and export administrative rules – a rule which drafting committee members have repeatedly pushed for during the five day meeting.

Under the rules, domestic websites will be expected to offer greater protection for consumer rights.

The new law also called for the establishment of “a complete set of regulatory system”,​ which spans across customs clearance, taxation, inspection and quarantine, and payment methods to regulate cross-border e-commerce (CBEC).

Further implementation guidance, including implications in respect of the CBEC grace period (due to expire on December 31), is expected in the coming months.

The authorities said that the arrangements are meant to make the processes of CBEC more convenient, improve monitoring procedures, and facilitate information exchange.

The country will also support CBEC operators in providing warehouse logistics, custom registration, and goods examination services.

Support is also given to small enterprises to conduct business in the CBEC sphere.

China's cross-border e-commerce trade saw its turnover rise 80.6% from 2016 to 90.24 billion yuan last year. The new legislation added that China would “promote the development of cross-border e-commerce.”

Trade organizations and consultancy firms had earlier warned​ that the authorities would make announcements on the new CBEC rules soon. 

The New Zealand Trade and Enterprise said that the regulations might affect supplement and functional food firms.

For instance, goods such as infant formula would need to be registered with the CFDA before they are imported into the country.

Complaints ​

Committee members have urged to tighten regulation of CBEC goods, citing the rise in complaints of food and milk powder bought via CBEC.

Milk powder (including milk), food (not including milk powder), diapers, health products and cosmetics, are CBEC products that have accumulated the most complaints, the committee members revealed.

International cooperation​

According to the new legislation, China will drive cooperation and exchange in the area of CBEC with different countries and regions.

This includes participating in the formulation of international e-commerce rules, promoting the international recognition of electronic signature and electronic identities.  

To resolve CBEC disputes, China will also drive and establish CBEC dispute settlement mechanisms with various countries or regions.