China reviews anti-dumping measures on imported PVC

BEIJING – China’s Ministry of Commerce (MOC) announced it will begin a review of the nation’s imported polyvinyl chloride (PVC) policies as anti-dumping measures are due for renewal.

The review comes at the request of domestic PVC companies and seeks to evaluate whether dumping or damages to the domestic industry will recur if the anti-dumping measures were terminated against PVC imports from the United States, the Republic of Korea, Japan, Russia as well as China’s Taiwan, the MOC said in a statement Monday.

The review will begin on Sept 29 and end before Sept 28, 2015.

A five-year anti-dumping tax on the PVC imports started on Sept 29, 2003. In 2008, the MOC decided to renew the anti-dumping measures for another five years after a sunset review.

India car makers turn to exports as local market slumps

HONG KONG — Heavy investment in India by global car companies in the hope that the fast-growing market would soon rival China are faltering as car sales fall and the depreciating rupee pushes up costs.

But the big brand carmakers such as Volkswagen, Ford and Renault-Nissan are now looking outwards, targeting vehicle shipments to countries abroad, such as the Europe and the U.S., as well as other emerging markets, HSBC said in a trade report on India.

Vehicles and transport equipment currently account for less than 7 percent of India’s total goods exports, but with the oversupply the carmakers have created in the Indian market, the report said it opened the way for India to become an auto export hub.

According to the bank analysts, car exports will be supported by the weaker rupee and the availability of skilled labour in India at a cheap cost. Rising labor costs in China have seen a decline in the mainland’s competitiveness, and this will provide a further boost to India’s automobile and related exports.

“We expect exports of transport equipment to increase by close to 15 percent a year in 2014-2030, far outpacing the 11 percent a year growth of total exports,” the report stated.

This was supported by strong growth in exports of heavy construction machinery made in India by companies such as Caterpillar, said AGS World Transport group CEO Michael Dye.

“This has turned into a good export engine for the country and is a huge business,” the NVOCC operator in Hong Kong.

India’s economy has expanded by less than 5 percent for the last two consecutive years, after growing by almost 8 percent a year in the previous decade, as weak domestic demand put the brakes on the economy. With exports accounting for just 25 percent of GDP, there is scope for India to rebalance away from the domestic economy towards exports, according to the HSBC trade report.

Yet India is expected to be the world’s fastest growing exporter between 2014 and 2030, and has the potential in that period to move from the 14th largest exporter of goods by value to the world’s 5th largest.

However, poor containerized rail service has been a factor hindering efficiency at India’s largest port, Jawaharlal Nehru Port (Nhava Sheva). The congestion also trickles down with the port of Paradip at one point having 27 ships waiting to dock as rains and a jump in imports pushed its capacity handling to the edge. Marine Link reported that in the 2013-14 fiscal year, total cargo handled at Indian ports increased by 4.3 percent to 976 million tons.

India’s goods exports are currently dominated by labour intensive, low-skilled sectors. According to the Ministry of Commerce’s latest data, mineral fuels, lubricants and related materials; and jewellery, precious stones and semi-precious stones, accounted for around 35 percent of India’s total goods exports in 2013-2014.

“Looking ahead, however, we expect more capital and skill-intensive sectors like pharmaceuticals and transport equipment to emerge as major contributors to overall exports.With a lot of potential to leverage India’s raw material strength in textiles such as cotton, jute and silk; textiles exports are likely to contribute strongly as well,” the bank’s analysts said.

“Our forecasts suggest that exports of mineral fuels, lubricants and related materials will rise at a rate of just below 8 percent a year in 2014-30, lower than the average growth rate of around 11 percent a year for total exports over the same period.”

Textiles exports accounted for more than 20 percent of India’s total exports in 2001. Since then the share has fallen to less than 10 percent, but India is still the world’s second largest textiles exporter, second only to China.

The Ministry of Textiles in India has introduced policies to develop the industry, aiming to diversify both the product base as well as export markets, improving textile oriented technology and investing in new marketing strategies. This, combined with a weaker rupee, rising labor costs in China and safety compliance issues for factories in Bangladesh (another major textiles producer), give India an opportunity to increase its market share. HSBC expects India’s textiles exports to increase by 12 percent a year between now and 2030.

An enormous and urbanising population means there are parallels to draw between India and China. Like its giant northern neighbour, India’s rapidly expanding middle class will drive growing demand for consumer goods from overseas markets.

By 2030, India is forecast to emerge as the world’s largest middle class consumer market, surpassing both China and the U.S. The bank analysts said this is likely to be accompanied by a shift away from primary food articles, which currently dominate consumer goods imports, towards more technology-intensive items such as computers and mobile phones.

“This presents opportunities for exporters in advanced economies, especially those who are able to capitalize on existing brand awareness; but they will face strong competition from companies in China, which are likely to grab a significant share of India’s demand for technology intensive goods. Indeed, India’s mobile market is already an important source of revenue for Chinese companies, accounting for more than 11 percent of turnover at Shenzen based Huawei technologies, for example, one of the world’s leading telecoms equipment makers,” the HSBC report stated.

Contact Greg Knowler and follow him on Twitter:@greg_knowler.

CBP Import Specialists and Officers Seize Counterfeit Rechargeable Toys Valued at $1.3 Million

Laredo, Texas – The Import Specialist Enforcement Team (ISET) at U.S. Customs and Border Protection’s (CBP) Laredo Port of Entry seized a total of 18 commercial shipments of counterfeit rechargeable toys over the summer, for allegedly infringing on the Underwriters’ Laboratories (UL) registered and recorded U.S. trademark. The total value of the shipments is nearly $1.3 million.

 battery charger baring a counterfeit Underwriters' Laboratories (UL) trademark

Battery charger baring a counterfeit Underwriters’ Laboratories (UL) trademark.

In the 18 enforcement actions, recently finalized, CBP import specialists from World Trade Bridge selected shipments of rechargeable toys for examination. During the examinations, CBP import specialists noticed that the battery chargers accompanying each rechargeable toy all bore the UL trademark, which is a U.S. registered trademark recorded with CBP. ISET conducted a review and discovered that the shipments lacked legal authorization documentation to use the recorded trademark   A lead enforcement manager for UL confirmed that the use of their trademark was unauthorized and infringing on their recorded trademark. Given the foregoing, CBP’s ISET determined that the rechargeable toys in the shipments seized bore counterfeit trademarks and were subject to seizure. In these 18 enforcement actions, from late June to early September 2014, CBP subsequently seized a total of 4,671 rechargeable toys, which, had the trademark been genuine, is valued based on the manufacturer’s suggested retail price, in the amount of $1,292,953.00.

“Our ISET has done it again and through their diligence and attention to detail they prevented toys with chargers baring a counterfeit trademark from entering U.S. commerce and potentially causing harm to children,” said Joseph Misenhelter, CBP port director, Laredo Port of Entry. “Preserving Intellectual Property Rights and import safety are priority trade issues for CBP and our enforcement of these laws helps create a level playing field for all and strengthens the U.S. economy.”

This seizure reflects the strong working relationship between the Laredo Port of Entry and CBP’s Commercial Targeting and Analysis Center (CTAC) and their coordinated efforts help support the Consumer Product Safety Commission through the “One U.S. Government at the Border Initiative.”

CBP’s vigilant enforcement of Intellectual Property Rights protects America’s businesses against the threat of unfair and illicit competition from foreign companies and prevents goods that may be dangerous to consumers or national security from entering the United States.

China will not alter economic policy

China will not dramatically alter its economic policy because of any one economic indicator,Finance Minister Lou Jiwei said on Sunday, in remarks that came days after many economists lowered growth forecasts having seen the latest set of weak data.

Lou made the comments at a meeting of finance ministers and central bank governors fromthe G20 countries in Australia, according to a statement from the People’s Bank of China,China’s central bank.

“China will not make major policy adjustments due to a change in any one economicindicator,” he said.

Economists dialed back their growth forecasts last week after data showed factory outputgrew at its weakest pace in nearly six years in August.

China’s total social financing aggregate, a broad measure of lending in the economy, was theweakest in nearly six years, data showed earlier this month, indicating credit levels were farbelow average.

China cannot rely on government spending to increase infrastructure investment, Lou added.

The economic stimulus measures adopted by China to confront the international financialcrisis had boosted economic growth, but they also brought excess capacity, environmentalpollution, and the growth of local government debt along with other problems, Lou said. As aresult, China cannot completely rely on public financial resources to make large-scaleinvestments in infrastructure.

Macroeconomic policy will continue to focus on comprehensive goals, especially maintaining employment growth and stability in the price of goods, Lou said.

UPDATE 4-China hands drugmaker GSK record $489 mln fine for paying bribes

* Former China head gets suspended sentence, to be deported

* Four other Chinese executives also get suspended jail terms

* GSK pledges to reform, remains committed to Chinese market

* U.S. and British corruption investigations still ongoing

* GSK shares up 1 percent; Chinese fine seen manageable (Adds details on fine, Chinese executives, shares)

By Adam Jourdan and Ben Hirschler

SHANGHAI/LONDON, Sept 19 (Reuters) – China fined GlaxoSmithKline Plc a record 3 billion yuan ($489 million) on Friday for paying bribes to doctors to use its drugs, underlining the risks of doing business there while also ending a damaging chapter for the British drugmaker.

A court in the southern city of Changsha handed suspended jail sentences to Mark Reilly, the former head of GSK in China, and four other GSK executives of between two and four years, according to state news agency Xinhua.

Briton Reilly, shown on state television wearing a suit and looking tired during the trial, will be deported, a source with direct knowledge of the case said.

The verdict, handed out behind closed doors in a single-day trial, highlights how Chinese regulators are increasingly cracking down on corporate malpractice.

However, it also offers GSK a potential way forward in the fast-growing Chinese pharmaceutical market, a magnet for foreign firms who are attracted by a healthcare bill that McKinsey & Co estimates will hit $1 trillion by 2020.

“If GSK China can learn a profound lesson and carry out its business according to the rule of law, then it can once again win the trust of China’s government and people,” Xinhua said in a commentary. Xinhua closely reflects China’s official government view.

The fine, equivalent to around 4 percent of GSK’s 2013 operating profits, was less than some investors had feared. GSK will take a charge in the third quarter and pay the penalty from existing cash resources.


GSK said it remained committed to China and promised to become a “model for reform in China’s healthcare industry”.

“GSK Plc has reflected deeply and learned from its mistakes, has taken steps to comprehensively rectify the issues identified at the operations of GSKCI, and must work hard to regain the trust of the Chinese people,” GSK said in a written apology.

Future commitments include investment in Chinese science and improved access to medicines across the country through greater expansion of production and flexible pricing, it said.

Roche Chief Executive Severin Schwan told Reuters in an interview this week: “I remain very bullish about China, even though currently the market has slowed down and pricing pressure has increased.”

GSK also faces investigations into its overseas practices by U.S. and British authorities. Those investigations continue and could result in further penalties for the group.

“The SFO criminal investigation into the commercial practices of GlaxoSmithKline Plc and its subsidiaries continues,” a spokeswoman at Britain’s Serious Fraud Office said in an email.

In the United States, GSK is being investigated under the Foreign Corrupt Practices Act, which prohibits bribery of public officials.

In addition to the high-profile Chinese case, GSK has been accused of corrupt practices, on a smaller scale, in Poland, Syria, Iraq, Jordan and Lebanon.

GSK said the activities by the firm’s China unit were a “clear breach” of GSK’s governance and compliance procedures.

Chinese police first accused GSK of bribery in July last year when it said that the firm had funnelled up to 3 billion yuan, exactly the same amount as the fine, to travel agencies to facilitate bribes to doctors and officials.

“Reaching a conclusion in the investigation of our Chinese business is important, but this has been a deeply disappointing matter for GSK. We have and will continue to learn from this,” GSK CEO, Andrew Witty, said in a statement.


The case is the biggest corruption scandal to hit a foreign company in China since the Rio Tinto affair in 2009, which resulted in four executives, including an Australian, being jailed for between seven and 14 years.

The judgment on Friday took many people by surprise, partly because Chinese authorities did not make the date of the trial public in advance.

The ruling from the Changsha Intermediate People’s Court means China has charged GSK’s China unit with bribery as well as the individual executives. Apart from Reilly, the other four – Zhang Guowei, Liang Hong, Zhao Hongyan and Huang Hong – are Chinese former company officials.

Under Chinese criminal law, bribery by a corporate unit can lead to a large fine and jail sentence for the unit’s head.

Reilly’s China-based lawyer declined to comment on Friday.

A spokesman for the British Consulate General in Shanghai said that Britain had “continually called for a just conclusion to this case”, but declined to comment further while the case was open for appeal.

Shares in the company rose 1 percent as investors took comfort from the manageable size of the fine and the removal of an uncertainty overhanging the stock. GSK has also struggled this year with poor sales in the United States.

“GlaxoSmithKline will hope that this will draw a line under events in China, but it will take time for its Chinese commercial operations to recover,” said Mick Cooper, analyst at Edison Investment Research in London. (1 US dollar = 6.1403 Chinese yuan) (Additional reporting by Koh Gui Qing, Fiona Li and Ben Blanchard in BEIJING and John Ruwitch, Kazunori Takada and Engen Tham in SHANGHAI; Editing by Mike Collett-White)

Alibaba’s affluent: Instant riches for company workers

BEIJING – You might be millionaires, but please spend wisely. In recent months, as the IPO of Chinese Internet giant Alibaba loomed into view, founder Jack Ma kept warning his employees. “We’ve worked so hard, but not for the sake of turning into a bunch of uncouth new rich,” he wrote in a late July e-mail.

With Friday’s eye-popping, record-breaking $167 billion listing in New York, China’s nouveau riche just swelled some more as more than 5,000 current and former Alibaba employees were selling their shares in this IPO. And they won’t lack for places to splurge their new-found wealth.

“Neighbors, congratulations” screamed a real estate billboard Friday at the Xixifengqing development a single street away from Alibaba’s headquarters in east China’s Hangzhou city. “This group of potential buyers is rich enough to buy the bigger townhouse, which is around $1.3 million for a 3,230 square foot house,” salesman Wang Mengzhou said. “I’ m confident our sales will soar in the near future.”

ALIBABA IPO: Shares soar in Chinese e-commerce firm’s trading debut

China’s newly prosperous typically rush into real estate, cars and luxury items such as expensive watches, said Rupert Hoogewerf, the Shanghai-based publisher of Hurun, China’s best-known “Rich List.” “Inevitably, more sports cars will be sold in Hangzhou than before,” said Hoogewerf, who expects Hangzhou may rise from fifth place on Hurun’s ranking of Chinese cities with most millionaires, based on U.S. dollars.

“The biggest challenge to somebody who got rich overnight is the change in lifestyle. Some turn to gambling, others live a lifestyle not commensurate to their wealth,” he said. “But these tech people are slightly different. They put a lot of heart and soul into the business,” said Hoogewerf, who expects that many Alibaba millionaires will buy property but also re-invest a significant amount in other start-ups.

With his love of kung fu novels, and a blending of East and West, Jack Ma, now executive chairman, strives to give Alibaba a distinct corporate culture. In May, he told more than 4,000 employees at an Alibaba conference that he hopes the IPO doesn’t mean “another batch of tuhao (slang for ‘uncouth new rich’) will appear in China”, reported the Zhejiang Online website. Instead, Ma hoped for “a batch of genuinely noble people, a batch of people who are able to help others, and who are kind and happy.”

Former Alibaba employees, many engaged in start-ups of their own, praise Ma’s efforts to raise a higher-minded workforce. “I heard some outsiders call Alibaba staff ‘tuhao’, but that’s not true,” said Huang Haijun, 40, a senior manager of Alibaba’s mobile market department who left in July after five years. “Most Alibaba people are rational and will use the money to start their own businesses,” he said.

Huang’s new venture, an angel investor called Zhonghai Investment, employs several former Alibaba employees. “I also prefer the entrepreneurs we invest in to be from Alibaba, as the company culture influenced them. They communicate easily, are able and highly efficient,” said Huang, whose confidence in the firm’s future growth persuades him to hold on to his shares for now.

Next Wednesday, Huang will attend a Hangzhou party to celebrate the IPO, organized by an association for former Alibaba employees that also encourages entrepreneurship. App-developer Yang Yang will attend, but celebrated Friday, too, by taking colleagues, including several Alibaba share-holders, to a lake near Hangzhou.

In 2006, after college graduation, he borrowed money from friends for the train ticket from central China to Hangzhou, and the chance to start as an entry-level salesman at Alibaba. Yang, now 31, left the firm last year as regional manager for most of north China, and set up a company to develop the ‘Love Car-Pooling’ app, similar to the USA’s Lyft.

“I never heard of any Alibaba people wasting money on unnecessary things,” said Yang. “It’s because of the company culture, which says you must make good use of your money, work hard, be creative, get promoted. Many people used money from shares to start their own businesses,” said Yang, who cashed in his own shares for $150,000 to buy a house with his fiancée in 2009.

Even where Friday’s listing brings no direct benefits, Alibaba’s success employs and inspires millions across China. Teenager Song Jinshen works at the frontline of Alibaba’s e-commerce empire. Like countless other deliverymen, steering three-wheeled electric tricycles stacked high with Taobao orders, he brought a box of toys Friday morning to a north Beijing address.

Song, 17, came to the capital three months ago from his home village near Xingtai, China’s most polluted city. A friend introduced him to Zhongtong, a Shanghai-based courier firm whose business has boomed nationwide with Taobao. Song was unaware of the New York listing Friday, but knows he owes his first job since leaving school to Alibaba’s red-hot retail site.

“Taobao is so successful it definitely inspires me,” said Song, who earns $490 a month, lives in a company dormitory with seven other guys, and eats for free. “In the future I want to set up a car valeting company, as that’s a good sector and I love cars,” he said.

His story suggests plenty of room for Jack Ma and rivals to grow. In common with around half of China’s more than 600 million Internet users, neither Song nor his parents have ever ordered anything online, despite having a computer in their village home.

Contributing: Sunny Yang

Court Finds That Individuals May be Personally Liable for Entry Violations on Company Imports

Import managers, compliance officers, business owners and others can now be held personally liable under U.S. Customs and Border Protection’s penalty statute (19 USC 1592(a)) for fraudulently or negligently providing information on company imports. A Sept.16 appeals court decision distinguishes between those who “enter” goods (e.g., the importer of record) and those who “introduce” goods into U.S. commerce and broadly defines the latter, creating a wide-ranging new category of individuals subject to penalties for violations of 19 USC 1592(a).

19 USC 1592(a)(1) prohibits any person from fraudulently or negligently entering, introducing or attempting to enter or introduce merchandise into U.S. commerce by means of any document or electronically transmitted data or information, written or oral statement, or act that is material and false or any material omission. U.S. v. Trek Leather Inc. and Harish Shadadpuri centers on Trek’s failure to include in the price actually paid or payable for 72 entries of men’s suits the cost of fabric assists provided to foreign manufacturers that were then incorporated into the imported suits. Shadadpuri argued that as Trek’s president and sole shareholder he could not be held personally liable for this failure because he did not serve as the importer of record.

In its Sept.16 en banc decision, however, the Court of Appeals for the Federal Circuit reversed its split August 2013 decision and ruled that 19 USC 1592(a)(1) applies to any person, regardless of whether or not they are an importer of record, and that “there is simply no basis for giving an artificially limited meaning to this most encompassing of terms, which plainly covers a human being.”

The CAFC then found that Shadadpuri was grossly negligent in introducing goods into U.S. commerce because he (a) transferred ownership of the goods while they were in transit to the U.S. to a company he chose to be the importer of record and (b) furnished to the hired customs broker, for use in completing and submitting the required entry documents, commercial invoices that materially understated the value of the merchandise.

The CAFC emphasized that its decision “does not require any piercing of the corporate veil” and that Shadadpuri is not being held liable “because of his prominent officer or owner status” but because he personally violated the statute and there is a “core principle” in the law that “a person who personally commits a wrongful act is not relieved of liability because the person was acting for another.”

This decision should be of immediate concern to individuals who are directly involved in the import process for their companies. It provides another reason to quickly correct entry errors when they are discovered and a compelling motive to engage in prospective compliance rather than reactive compliance.

For more information on this decision and its effects, please contact Larry Ordet or Arthur Purcell.​

US Customs plans to take trade facilitation to next level

WASHINGTON — The newly appointed head of international trade at U.S. Customs and Border Protection said she wants to streamline regulation, make better use of data and improve employees’ analytical skills to improve cargo trade facilitation. As a result, the agency will be able to better focus its attention on high-risk cargo, giving safe shipments faster clearance.

Brenda Smith’s promotion to assistant commissioner of the office of international trade has been widely welcomed by those in the trade industry; she was key in getting a long-delayed major cargo-processing system back on track. Because of her leadership, the Automated Commercial Environment, a system plagued by cost overruns, is set to be implemented Oct. 1. The new system should bring cost-savings to shippers and expedite shipments.

Smith said she wants to put “current regulations and practices under the microscope” as the agency has “built up a lot of barnacles.” The agency will look to continue not only streamlining its own practices but also how it works with the other 46 government agencies that can slow or hold cargo releases, she said during a media briefing. The agency will also work to ensure that instead of collecting more data from shippers, forwarders and others, it improves its use of existing data, Smith said.

“We need to make sure (the data) is available to employees to make good decisions, and (that) they have the tools to analyze” the information, she said.

Smith also stressed that Customs employees need to better develop their analytical skills, and ability to communicate with each other and officials at other agencies.

The push for more training comes as many in the freight industry worry the agency has lost too many senior officials who understood trade facilitation and the importance of working with shippers, forwarders and brokers.

Customs Commissioner Gil Kerlikowske acknowledged the agency has recently lost valuable staff, including Al Gina, who Smith succeeds. Richard F. DiNucci, previously acting assistant commissioner of the office of international trade, will serve as executive director of cargo conveyance in the office of field operations.

Kerlikowske said he is working to fill Smith’s former position, executive director for ACE Business, and is confident her team will be able to complete ACE without her direct involvement. Since being confirmed as commissioner about six months ago, Kerlikowske said he is impressed with the “depth of talent” working at the agency and confident in his “bench.”

Kerlikowske, the first Customs chief with congressional approval since 2009, said he realizes what he doesn’t know about trade facilitation and that’s why he’s making sure his team is filled with people that make up for his gaps in expertise.

The former U.S drug czar has made an effort to get a handle on the business and show the trade community he can balance trade facilitation with security. Still, he realizes that this is just the beginning.

“We are trying to solidify a lot of positions that have ‘acting’ in front of them,” Kerlikowske said. “We will have more announcements in the future as we get our team in place.”

Contact Mark Szakonyi at and follow him on Twitter: @szakonyi_joc.

MSC announces low-sulfur surcharges in North Europe, North America

Mediterranean Shipping Co. today unveiled surcharges of up to $165 per 20-foot container on North European and North American routes that will be subject to new low-sulfur limits in 2015.

The Geneva-based carrier said shippers and receivers will have to pay for the “significant” increase in the cost of fuel in the affected emission control areas, or ECAs, according to individual trade lanes. Ships passing through the ECAs ― the Baltic Sea, the North Sea, the English Channel and 200 nautical miles from the American and Canadian shores ― will be compelled to burn fuel with a sulfur content of 0.1 percent from Jan. 1 compared with the current 1.0 percent limit, as mandated by the International Maritime Organization.

The MSC surcharges vary widely from a high of $165 per TEU for shipments between Canada and the Baltic to a low of $5 per TEU between Central America and Freeport, Texas. Shippers face a surcharge of $130 per TEU on the U.S.-Baltic trade, $150 between the Baltic and the U.S. West Coast and $50 per TEU on routes between the U.S. and India. The surcharge on MSC’s Lion and Silk services between Asia and northwest Europe is just $15 per TEU because the low-sulfur limit does not apply in Far East waters.

Low-sulfur fuel of 0.1 percent is around $300 per metric ton cheaper than 1.0 percent fuel. Low-sulfur fuel of 1.0 percent averaged $559.90 per metric ton for the week ending Sept. 12, according to numbers provided by BunkerVision. One metric ton is equivalent to about 6.4 barrels or 300 gallons.

Maersk Line has warned customers they face hikes of between $50 and $150 per 40-foot container to enable it to recoup the estimated $250 million a year increase in its fuel bill. The carrier says it will publish more details closer to the implementation of the new sulfur rules and when price differences between fuels can be more precisely estimated. Hapag-Lloyd and Rickmers-Linie have also advised shippers they face low-sulfur surcharges from January.

The looming IMO requirements for low-sulfur fuel will likely prod more ocean carriers to implement these types of surcharges. These rules are also creating momentum around the use of liquefied natural gas to power container ships on long-haul international routes, as well as regional feeder services.

| Sep 15, 2014 12:17PM EDT

China: A Step In The Right Direction For Importers And Exporters

For the approximately 14,000 Beijing-based companies with frequent import and export shipments China’s General Administration of Customs (GAC) has commenced the implementation of some welcome changes.

Currently, more than half of these Beijing-based companies have to export their products through Tianjin and Hebei, which can be slow and costly.

With effect July 1, 2014, Beijing and Tianjin Customs are introducing simplified procedures through a new regional integrated online clearance system, which will facilitate trade through the region.

Four unified platforms have been established in a centralized customs clearance center. This center will take charge of required processes, including declarations, document examinations, risk control and field operations, across the region.

GAC anticipates that Hebei Customs will join this integrated system in October 2014, effectively integrating 43 Customs clearance sites in Beijing, Tianjin and Hebei. The system also will be implemented in China’s Pearl Delta and Yangtze River areas in October 2014. Each of these Customs clearance centers will be able to share information through this regional online integrated clearance center.

The impact on traders is great. With this new system, a company in the region can choose any Customs office within the region to lodge their import or export declarations.

GAC has indicated that following the completion of related customs procedures, any Customs offices in the area will recognize checks conducted by their counterparts. This will have cost saving and time saving benefits. Other key benefits are the potential elimination of having to use different tariff classifications at some ports of entry for the same goods, acceptance of value at one port and not having to deal with multiple Customs offices.

The average clearance time for importing and exporting through Beijing Capital International Airport had been approximately 8 hours.

July 1, 2014, we understand that Customs offices in Tianjin and Beijing processed approximately 260 cross-customs orders with each taking only a minute to complete customs clearance.

However, we anticipate that there could be implementation delays during this initial period.

Article by Anthony Kerr, Flora H. Sun and Jun Zhao