New Foreign Trade Regulations Effective From August! Foreign Trade Professionals Please Note →→

New Foreign Trade Regulations Effective From August! 

Foreign Trade Professionals Please Note →→

In August, several new foreign trade regulations have come into effect domestically and internationally. These cover areas like import licensing, customs facilitation, trade remedies, product quarantine, and business operations.

01. Domestic Policies

[Export Control on Gallium and Germanium-Related Items Effective from August 1]

Recently, the Ministry of Commerce and the General Administration of Customs issued a notice regarding the export control of gallium and germanium-related items. In accordance with the “Export Control Law,” “Foreign Trade Law,” and “Customs Law of the People's Republic of China,” to safeguard national security and interests, the Chinese government has decided to impose export controls on gallium and germanium-related items starting from August 1, 2023.

[CCC Certification Management for Lithium-Ion Batteries Effective from August 1]

The State Administration for Market Regulation announced that, effective August 1, 2023, lithium-ion batteries, battery packs, and portable power sources will be subject to CCC certification management. From August 1, 2024, products without a CCC certification certificate and the certification mark cannot be manufactured, sold, imported, or used in other business activities.

[China Customs Bans Food Imports from Japan’s Fukushima and 10 Other Regions]

To prevent the import of food contaminated by radiation from Japan and to ensure the safety of Chinese consumers, China Customs has banned the import of food from Fukushima and 10 other regions. For food products from other regions of Japan, especially seafood (including edible aquatic animals), the accompanying documentation will undergo strict review. China Customs will also strengthen radiation testing and monitoring to ensure the safety of Japanese food imports to China.

[Central Government’s Economic Work for the Second Half of the Year: Stabilizing the Foreign Trade and Investment Base]

On July 24, the Political Bureau of the Central Committee of the Communist Party of China held a meeting to analyze the current economic situation and plan the economic work for the second half of the year. Key measures include stabilizing foreign trade, expanding international economic cooperation, and improving the business environment for foreign investors.

[The Central Committee and the State Council Encourage Private Enterprises to Expand Overseas Operations]

On July 19, the Central Committee and the State Council issued an opinion promoting the development of private enterprises. The opinion supports private enterprises in enhancing international competitiveness, extending their operations, and participating in overseas projects, particularly within the “Belt and Road Initiative.”

[China and Nicaragua Announce Completion of Substantial Free Trade Agreement Negotiations]

On July 25, China’s Minister of Commerce Wang Wentao and Nicaragua’s Minister of Development, Industry, and Trade announced the substantial completion of negotiations for a China-Nicaragua Free Trade Agreement. The two sides aim to sign and implement the agreement as soon as possible.

02. International News

[The US Senate passed an amendment regarding technology investment in China]

On July 25, local time, the US Senate passed an amendment to the National Defense Authorization Act (NADD) for Fiscal Year 2024 by an overwhelming majority of 91 votes to 6, requiring US companies to inform federal agencies of their investments in Chinese technology fields, including semiconductors and artificial intelligence.

In addition, the US Senate also passed another amendment to the National Defense Authorization Act for Fiscal Year 2024 on July 25, requiring enhanced federal review of foreign purchases of US farmland and prohibiting China, Russia, Iran or North Korea from purchasing US farmland in certain circumstances.

[The EU formally approved the European Chip Act]

On July 25, local time, the EU Council formally approved the European Chip Act, which is the last step in the decision-making process. Once published in the EU Official Gazette, the bill will officially take effect and will mobilize 43 billion euros (about 340 billion yuan) of public and private investment to support the local chip supply chain and reduce dependence on US and Asian manufacturers.

[UK officially joins CPTPP]

On July 16, British Business and Trade Secretary Kemi Badenoch officially signed the UK's agreement to join CPTPP in Auckland, New Zealand.

So far, the UK has become the first country to join the CPTPP since its establishment in 2018. For the UK, this is also the largest trade agreement the country has reached since it left the EU more than three years ago. It is estimated that after joining the CPTPP, the UK economy is expected to grow by an additional 1.8 billion pounds each year, equivalent to 0.08% of the country's annual GDP.

[France will no longer automatically print paper receipts from August]

For environmental reasons, France's measures to cancel the automatic printing of paper shopping receipts will be officially implemented from August 1.

After the new regulations are implemented, except for special circumstances, paper receipts will no longer be printed as shopping receipts by default, but electronic receipts will be sent to mailboxes. If consumers want paper shopping receipts, they must make a clear request when paying.

[Brazil to implement new cross-border online shopping import tax regulations from August 1]

According to the new cross-border online shopping import tax regulations announced by the Brazilian Ministry of Finance, from August 1, orders generated on cross-border e-commerce platforms that have joined the Brazilian government's Remessa Conforme plan and with an amount not exceeding US$50 will be exempt from import tax, otherwise a 60% import tax will be levied. Since the beginning of this year, the Brazilian Ministry of Finance has repeatedly stated that it will cancel the tax-free policy for cross-border online shopping of US$50 or less, but under pressure from all parties, the ministry decided to strengthen supervision of major platforms while maintaining the existing tax-free rules.

[Japan bans the export of 23 chip manufacturing equipment]

Following the United States and the Netherlands, Japan's new regulations restricting the export of semiconductor manufacturing equipment officially came into effect on July 23. The 23 categories include manufacturing equipment for extreme ultraviolet (EUV)-related products, as well as etching equipment that can stack storage components in three dimensions. In addition to 42 countries and regions including the United States and other friendly countries, when exporting controlled equipment to other countries, companies need to apply for a license from the Ministry of Economy, Trade and Industry, and China is also among those that need a license.

[Indian rice export restrictions take effect]

The Indian government announced on July 20 that in order to ensure domestic market supply, it will ban rice exports except parboiled rice and basmati rice, which will take effect immediately. Some analysts pointed out that India's ban on rice exports is related to the tight rice supply and continued inflation faced by the country. As a major rice exporter, India's ban may exacerbate the global food security crisis.

[Myanmar will issue RCEP certificates of origin to 7 ASEAN countries from August 1]

According to the relevant provisions of the Regional Comprehensive Economic Partnership Agreement (RCEP), Myanmar will issue export product certificates of origin (CO Form RCEP) to 7 ASEAN countries from August 1, and export products will enjoy the customs preferential policies of relevant countries.

From August 1, exporters can apply for certificates of origin at the export office and trade ports of the Ministry of Commerce's Trade Department. Cambodia, Thailand, Brunei, Laos, Singapore, Malaysia and Indonesia among ASEAN members will grant customs preferential policies to goods originating from Myanmar.

【Thailand bans export of this type of rosewood from August 16】

From August 16, Thailand will ban the export of Siamese rosewood. Except for rubber wood, wood and charcoal products must obtain trade or export certificates in accordance with the Forest Law.

As a kind of precious rosewood, Siamese rosewood is mostly produced in Southeast Asian countries such as Thailand, Vietnam, and Cambodia. Due to excessive consumption, over-cutting, and slow growth, Siamese rosewood has been listed in the Appendix of the Convention on International Trade in CITES and has become an internationally second-level endangered wild plant.

【Vietnam and Israel sign free trade agreement】

Vietnam and Israel signed a free trade agreement on July 25, which is expected to quickly boost bilateral trade by nearly 50%. The Vietnamese Ministry of Industry and Trade said in a statement that the two countries' trade ministers signed the agreement in Israel after seven years of negotiations. The ministry said that last year's trade between the two countries increased by 18% to US$2.2 billion, and the agreement is expected to soon bring bilateral trade to US$3 billion.

Vietnam's largest exports to Israel include smartphones, shoes and seafood, while importing electronic products and fertilizers. Vietnam's Ministry of Industry and Trade said the agreement will eventually eliminate tariffs on at least 86% of Vietnamese products and 93% of Israeli products.

[Egypt and Vietnam start early negotiations on free trade agreement]

On July 27, the Egyptian Prime Minister's Office said that Egypt is in early negotiations with Vietnam on a free trade agreement. In addition, the Central Banks of Egypt and Vietnam signed a memorandum of understanding to strengthen cooperation. Currently, Egypt is Vietnam's main trading partner in North Africa, with trade volume growing year by year, reaching nearly US$600 million in 2022.

[India and the UAE establish a local currency settlement mechanism]

The Reserve Bank of India announced on July 15 that the Reserve Bank of India and the Central Bank of the United Arab Emirates signed a memorandum of understanding to establish a local currency settlement mechanism (LCS) to promote cross-border transactions using Indian rupees and UAE dirhams. Earlier that day, Indian Prime Minister Modi arrived in Abu Dhabi, UAE, to start an official visit to the UAE.

[Russian President Putin signs digital ruble bill]

According to Russian News Agency on July 24, Russian President Putin signed a law on digital ruble on the 24th, stipulating the legal norms for Russia to promote digital ruble. According to the law, individual customers will be free to transfer and pay with digital rubles, while corporate customers will be charged 0.3% of the payment amount for accepting digital ruble payments. The Russian Central Bank plans to start a pilot issuance of digital rubles in August.

[Visa-free group tours with China and Iran will be launched from August 1]

Cailian News reported on July 26 that Russian Minister of Economic Development Maxim Reshetnikov said that Russia will launch visa-free group tours with China and Iran on August 1, and all preparatory procedures have been completed.

03 Shipping and Logistics Policies

[Shipping Companies Announce Rate Increases for August]

CMA CGM:

Effective from August 1, 2023, CMA CGM will raise the FAK (Freight All Kinds) rates for shipments from all Asian ports (including Japan, Southeast Asia, and Bangladesh) to all Northern European ports (including the UK, and all routes from Portugal to Finland/Estonia). The rate for a 20-foot dry container will increase to $1,075, while the rate for a 40-foot dry or reefer container will increase to $1,950.

Maersk:

- Announced an FAK rate increase from Northeast Asia to Australia, effective July 31, 2023. The rate for a 20-foot container will increase by $300, and the rate for 40-foot and 40-foot high-cube containers will increase by $600.

- Maersk will also raise FAK rates from Far East Asia to Northern Europe, effective July 31, 2023.

CMA CGM (additional updates):

- Rates for shipments from Asia to the Mediterranean and North Africa will also increase, effective from August 1, 2023, until further notice.

- FAK rates for shipments from Asia to Northern Europe will be raised starting August 1, 2023, with no specified end date.

HMM:

HMM will adjust FAK rates from Far East Asia to Northern Europe. Starting August 1, 2023, the rate for a 20-foot container will increase to $1,050, while the rate for a 40-foot and 40-foot high-cube container will rise to $1,900, effective until further notice.

MSC:

MSC announced a General Rate Increase (GRI) of $150 per TEU for all shipments from China, Hong Kong, Taiwan, Japan, and Korea to ports in Australia and New Zealand, effective from August 1, 2023.