Kiwi firms braced for China rules change
New Zealand officials keeping a watching brief over republic’s new e-commerce laws that could impact trade
New Zealand trade officials are keeping a close eye on changes to rules that cover cross-border e-commerce (CBEC) trade into China, which has become a key plank for a number of companies doing business there.
The new law, passed on August 31, creates a framework for e-commerce covering the domestic and crossborder trade for imports and exports.
The grace period for existing regulation runs out on December 31.
The changes arise from concern from China’s legislators about complaints regarding CBEC foods, infant formulas, diapers, healthcare products and cosmetics that are not under supervision of the authorities.
Kiwi officials are largely in the dark on the possible ramifications for New Zealand companies.
“It is important to stress that the details of implementation and the ensuing full implications for New Zealand companies have not yet been released,” a spokesman for
New Zealand Trade and Enterprise (NZTE) said.
“NZTE will continue to monitor the changes and we will seek a short interpretation of the law from a regulatory specialist. Specifically, we will seek to understand what it will mean for New Zealand companies using cross border e-commerce and what they should do to keep abreast of news, but we have to stress that not all the practical detail is out there yet.” Exports into China through the unofficial “daigou” channels or larger e-commerce platforms have formed an important pathway for infant formula and manuka honey exporters. Manuka honey exporters should not be affected because it is treated as a food by the regulators.
Comvita chief executive Scott Coulter said there was no direct or indirect impact on Comvita from the rule change.
Manuka Health chief executive John Kippenberger said the authorities had been signalling regulatory changes for some time.
“From what we understand, it means that products going into China through the e-commerce cross border channels will be subject to the same regulations and processes that apply to products that go directly into the national China market,” he said.
There are different forms of e-commerce, such as the daigou trade, and various larger-scale e-commerce platforms.
“The question that will be answered in due course is whether the new regulatory environment or framework is going to apply to those channels, or will daigou continue to trade outside this regulation,” Kippenberger said. “A lot of New Zealand companies are growing in China, but it’s a market that does have its complexities.”
Infant formula maker Synlait Milk, in its latest annual report, said in the case of Akara and Pure Canterbury brands, its applications for brand registration were with China’s State Administration for Market Regulation. Synlait’s team was working with the regulator on its various queries.
In a conference call after the company’s result last month, Synlait Milk’s chief financial officer Nigel Greenwood said the regulatory environment in China continued to tighten.
“But we consider that as being more beneficial to Synlait than not, because of the people that we partner with and the quality of our facilities,” he said.