China’s regulations on imports: What business owners need to know in 2022
Tags: Company Verification, Credibility, Doing Business in China, Due Diligence, FDI, SMBs and SMEs
This article is provided by Emilia Shi, a business lawyer based in Shanghai, China. She has over 20 years of experience in securities and corporate law.
Emilia’s primary areas of practice include corporate governance and compliance, foreign direct investment (FDI), mergers and acquisitions, private equity and real estate. She has advised clients on projects covering automobiles, chemicals, education, manufacturing, media, pharmaceuticals and real estate.
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Lawyer and Senior Partner at Dacheng Dentons Shanghai Office
Companies may export goods and services directly to China from their home countries overseas. When doing so, it is crucial to understand China’s relevant regulatory framework. In order to help your business comply, it’s important to familiarize yourself with the relevant Chinese regulations.
Certain products are subject to import licensing control in China, and overseas export business owners need to know about these details. You should be aware especially of “classified categories,” which list goods according to the restrictions, if any, imposed upon them.
China updates the lists of these products every few years, and the latest versions were published in 2021. Here is some general information about how China regulates its imports.
The Chinese government has established three categories of imported goods:
The “prohibited list” covers things that one cannot sell to China legally. In short, they are usually items or products that are considered harmful or risky to people’s health or to the environment. For example, toxic waste is currently on the prohibited list.
The “restricted list” consists of goods that are not completely banned in China, but nevertheless have some restrictions on them. Although these goods are not seen as being so harmful that they must be prohibited, they still pose some risk. For example, restricted goods include certain products that could damage the ozone layer.
Restricted goods present a good opportunity to make money, but these exports can be made only after successfully dealing with the complex regulatory system in China. China may impose quotas on restricted goods or require licenses in order to export them to that country. So this is the category to which you may wish to pay considerable attention.
The good news, though, is that most imported goods fall into the “Permitted” category; this means you can sell them freely to China. Furthermore, the Chinese Ministry of Commerce (MOFCOM) has implemented an automatic licensing system to monitor the importation of such goods. Finally, it is worth noting that permitted goods normally include most products from Canada.
For further details or specific questions related to your business needs for entering the Chinese market, sign up for a free account and book a consultation session with Emilia Shi.
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