E-commerce: new duty drawback possibility in China

Customs eAlert

Cross-border e-commerce began to grow significantly in China and is now an important part of Chinese foreign trade. Henceforth, the Chinese government wishes to accelerate the development of e-commerce in China and facilitate the return of goods. In that regard, a joint announcement by the Chinese Customs, Finance and Tax Administration was made on 30th January 2023.

It is now possible for re-imports of goods previously exported through e-commerce to be exempted from customs duties, value-added tax and consumption tax, in certain cases. Such re-imports will also be eligible for a refund of any export duty previously paid.

Several conditions must be met, including the presentation of a certificate of payment of the refunded tax if the exporter has completed the export tax refund formalities and the reasons must be specified as to the return (unsaleable product, customer return, slowdown in sales, etc.).

China is thus adopting a return regime, partly similar to what exists within the European Union. So, in the same way as in the EU, the goods will have to return in the same original condition. However, it seems that Chinese regulations are stricter in the conditions to be respected regarding the absence of modification of the goods. Therefore, the goods must not have undergone any modification such as no addition or removal of a part, no special treatment, no use by a user, between the time of their export from China and their re-importation.

However, it appears that this return regime only applies to flows linked to e-commerce. Moreover, we would like to draw your attention to the fact that the time limit for returning exported goods seems to be relatively short, in contrast to the current situation in the European Union.

The announcement made by the various administrations does not specify whether prior authorization will be necessary in order to benefit from this regime and whether it will be extended to non-e-commerce flows. It remains to be seen how this will be implemented in practice allowing operators to benefit from this customs easement.


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José Manuel Moreno

José Manuel Moreno

Avocat, Associé TVA & Indirect Tax, PwC Société d'Avocats

Luana  Higino Balbino

Luana Higino Balbino

Directeur, Douanes, PwC Société d'Avocats

Anouchka Lécaille

Anouchka Lécaille

Avocat, Manager, Douanes, PwC Société d'Avocats