China’s new e-commerce law, which went into effect on 1 January, had threatened to devastate the daigou trade. But personal shoppers are already flouting the rules, reports Ruonan Zheng of Jing Daily.
CHINA. “What happened to daigou on the first day of 2019?” was the tempting headline of a post that drew more than 100,000 views in about a day on Chinese social media giant WeChat last week. The article, originally published on popular blog InsDaily, illustrated vividly the lengths to which daigou are going to get around China’s new ecommerce law.
Daigou are cross-border personal shoppers who buy clothes, accessories and cosmetics in the West for private and profitable resale within China. They came under increased government scrutiny on New Year’s Day as a new ecommerce law went into effect. This requires online sellers to disclose their qualifications and their business licenses and other information.
With daigou trading, sellers and buyers pay no customs duties or taxes. The trade can also be prone to fraud.
Some daigou attempted to avoid detection of their efforts by offering products with hand-drawn pictures and fake names. In one image (see below), American skincare brand Clinique is depicted as a yellow square and high-end cosmetic brand La Mer has a Chinese name, “La Mei.”
Many daigou also used foreign languages like Russian, Korean and Japanese to introduce the products, intentionally avoiding the mentioning of brand name, product style, and price. Others only used WeChat voice message to communicate with clients, or used Alipay for transactions to avoid WeChat scrutiny.
Ruby Liu, a London-based daigou, told us that she has heard about a rumour WeChat would be cracking down and started to post drawings instead of real product pictures “just to be safe”. Another daigou in his thirties said he had not seen the effect of any crackdown and his posts of real product pictures had yet to be taken down.
He added: “Drawings are used as a marketing gimmick to get people’s attention.”
Although the law isn’t entirely clear, which is why daigou are using a variety of methods to avoid being noticed, daigou platforms such as WeChat could be liable and face penalties if proven to be involved in illegal activities.
Jing Daily reached out to Tencent, owner of WeChat, for comment, but has yet to hear back. According to Chinese media Beijing Youth Daily, Tencent said the company never encouraged conducting commercial activities using personal WeChat accounts, but the company has not implemented regulations against WeChat daigou yet.
Tencent added it has received many complaints reported by users that involved the sale of counterfeit goods, fraud and commercial infringement. It added that these will be handled according to relevant laws and user agreements.
While daigou seem to be aware of the changes, some are at a loss on where to start to comply with the law. Liu, who started a daigou business when she was an undergraduate and has been doing it to support her expenses living abroad, is unclear about where to start the license registration process and is still waiting to see what her other daigou friends are doing next.
“For now, staying low seems to be the best temporary solution,” she told us.
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This article was originally published by the much-respected JING DAILY, a Moodie Davitt Report content partner.