AuMake predicts a sunny 2019 after China nixes tough ecommerce laws
Health & Biotech
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China has delayed plans to introduce stringent new ecommerce laws, allowing exporters like AuMake to relax and predict a good 2019 for Chinese sales.
Exporter AuMake (ASX:AU8) says that as a result they’re expecting an increase in buying from ‘diagou’ (which means to buy on behalf of), or people outside China who shop on behalf of a China resident.
“These measures are anticipated to increase the total size of cross-border ecommerce and it is anticipated that legitimate cross border e-commerce participants, including AuMake and professional daigou, will increase their market share as illegitimate operators are phased out with increased regulation,” AuMake told investors.
AuMake stock was up 10 per cent on Friday morning at 28c.
China had intended to bring in tough new rules around cross-border ecommerce trade from January 1, 2019, to tackle tax avoidance and food safety.
These included extra licensing, registration, and record-filing for first time imports, and changes to way goods were taxed.
Instead, on Wednesday the Chinese government agreed to delay those changes.
Instead of adding more paperwork requirements, China is relaxing regulation around retail imports.
Preferential tax treatment will be extended to another 63 categories of high demand goods, and the amount people can buy to get those tax benefits has increased.