Legal Team in Beijing: Notes on tax structure and import restrictions of retail scorpion snacks and air filters

Well, let’s pack our bags! China just released a regulation that severely restricts importing cross-boarder and direct-to-consumer retail goods, so I think we’re done here. Around 1200 products were placed on a list of allowable import goods, and, unfortunately, the only copy I have is twenty-four pages of simplified Chinese characters (or are they traditional?). In any case, I cannot read either; and what’s the chance an air filter will be on that short list anyway? Not likely! So let’s cut our losses, call the client and explain that China is controlling their oversupply through import restrictions that will likely last for a decade or more, then take the next camel train to Mongolia. I'm sure Heidi will appreciate our cultural curiosity.

Mongolia: Within Reach
There it is, on the other side of that wall, Mongolia!

Fortunately for the client (unfortunately for my bucket list of taking a camel train) and with the help of Google Translator, we were able to sift through the list of characters and find four items relating to air purifiers; somewhere between volcanized rubber condoms and prepared? or preserved? scallops. (Google has its limits.) We’re back in business!

Legal Team Conference
Legal Team: Doing Business

The legal team’s focus shifted through the week to study the tradeoff of between using a bonded warehouse versus a direct-to- consumer model to move products into China. Bonded warehouses connect customs control with the warehouse inside a boundary zone to stimulate open trade in a specific area and allow for faster delivery times on foreign products. They  also come with great tariff and tax reductions. However, the downside is the shortage of bonded warehouses in China and the rapidly changing regulations that reduce the tax benefits of cross-border trade, thus shifting the advantage to local retail and direct-to-consumer parcel shipment models in our model. In the remaining days, the Legal team will be working with the marketing and logistics teams to blend together a final recommendation for Columbus Industries.

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