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March 30, 2020

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How to navigate cross-border trade after outbreak

The COVID-19 pandemic is disrupting international shipping and flights. Many countries and regions have started imposing tighter restrictions on cross-border travel and import-export operations.

In China, after an all-out assault on the virus, the epidemic is easing and businesses are slowly starting to return to normal. That is now a top government priority.

However, infection cases originating from overseas arrivals have been rising. That has prompted public calls for more stringent inspection and quarantine measures to be applied to both imported and exported goods.

Such “trade safety” measures pose a greater challenge for businesses on the cusp of returning to normal operations.

Since early 2018, the function of entry-exit commodity inspection and quarantine has been reformed and transferred to China Customs from another inspection administration.

As the epidemic in China eases, further strengthening over the administration of trade compliance can be expected. That means more comprehensive requirements for credit-risk management. As such, it’s time to think about adjustments that may need to be made in trade strategy and compliance.

The Authorized Economic Operator is a certification program currently adopted by China Customs, in alignment with international standards, for credit and risk management. The objective is to create effective supervision over legitimate cross-border trading activities.

Importers and exports can benefit from lower inspection rates, simplified documentation procedures and priority in the clearance process.

The certification standard was updated in 2019 to incorporate additional assessment criteria and requirements for commodity inspection and quarantine.

On one hand, improvement of internal controls and safety procedures will be helpful in the prevention of epidemics once business activity is back to normal.

For example, the certification standard places great emphasis on safety in the areas of access, workplaces, personnel safety, business partnerships and cargoes.

In particular, the standard includes new content related to quarantine requirements for transportation vehicles and containers, and measures for crisis management and safety training.

All these elements will promote the safer working environment required by businesses to resume normal operations.

On the other hand, accreditation as certified businesses will enable companies to quality for smoother processing through inspection and clearance.

Companies are advised to heed licensing requirements, quality and safety compliance, and rules related to commodity inspection and quarantine.

Businesses are encouraged to establish risk-prevention systems for improving trade compliance and to meet the Authorized Economic Operator certification requirements.


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