Trade

Ten Key Points for Safe "Going Global" of Cross-Border E-Commerce

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43 MIN READ
ABSTRACT

Attorney YE Peng systematically reviews the development opportunities and compliance guidelines for Chinese cross-border e-commerce going overseas. It first distinguishes between cross-border e-commerce and traditional foreign trade, then analyzes industry growth prospects. Practical recommendations are provided on mainstream platform selection, logistics model configuration, customs declaration procedures, and overseas warehouse tax rebate processes. It also details the latest Chinese government support policies and regulatory and taxation requirements in key markets including the US, Europe, and Southeast Asia. Finally, addressing multiple risks faced by sellers in policy, logistics, payment, and intellectual property, the article proposes core strategies including brand building, localized operations, tax and data compliance, aimed at providing comprehensive guidance for enterprises to expand overseas markets safely and efficiently.

With economic development, the scale of China’s cross-border e-commerce transactions continues to expand, and the proportion of export transactions is growing rapidly, prompting domestic e-commerce enterprises to increase their layout in overseas markets. To help cross-border e-commerce avoid risks and successfully “go global,” we hereby propose ten key points for safe “going global” of cross-border e-commerce, covering policies and regulations, platform selection, logistics and warehousing, intellectual property, data security, brand building, customs clearance and tax rebates, and compliance operations, aiming to provide enterprises with comprehensive guidance and advice.

I. Understanding What Cross-Border E-Commerce Is

Cross-border e-commerce refers to an international business activity where transaction parties in different customs territories reach transactions through e-commerce platforms, conduct payment and settlement, and deliver goods through cross-border logistics to complete transactions. This needs to be distinguished from traditional foreign trade. Traditional foreign trade refers to the process where enterprises sell goods or services to foreign markets through traditional international trade methods.

Although both are forms of international transactions, there are clear differences in transaction models, logistics methods, payment methods, policy environments, and challenges faced:

(1) Transaction Model

Cross-Border E-Commerce:

Connects directly with consumers through e-commerce platforms, with transactions completed online and simplified processes.

Traditional Foreign Trade:

Relies on offline channels, with transactions conducted through multiple intermediaries such as agents and wholesalers, with complex processes.

(2) Logistics Methods

Cross-Border E-Commerce:

Typically uses small package express delivery, overseas warehouses, etc., with fast delivery speed.

Traditional Foreign Trade:

Usually uses large-scale shipping methods such as sea freight and air freight, with longer cycles.

(3) Payment Methods

Cross-Border E-Commerce:

Supports various online payments such as credit cards, PayPal, Alipay, etc.

Traditional Foreign Trade:

Mainly relies on traditional payment methods such as letters of credit (L/C) and telegraphic transfers (T/T).

(4) Policy Environment

Cross-Border E-Commerce:

Affected by various countries’ e-commerce policies, such as tariffs, data protection, etc.

Traditional Foreign Trade:

Affected by international trade agreements, tariff policies, etc.

(5) Risks and Challenges

Cross-Border E-Commerce:

Main challenges include differences in trade policies and legal regulations across countries, the security and efficiency of cross-border payment and logistics, and building consumer trust. For example, different countries’ tariff policies, import restrictions, and payment security issues can all impact cross-border e-commerce enterprises.

Traditional Foreign Trade:

Must address issues such as trade barriers, contract disputes, and transportation risks.

II. Opportunities in Transforming to Cross-Border E-Commerce

According to eMarketer data, global e-commerce sales are expected to reach USD 6.3 trillion in 2024, a year-on-year increase of 8.76%. From 2024 to 2027, global e-commerce sales will continue to grow at a compound annual growth rate of 7.8%, reaching an estimated USD 8 trillion by 2027.

According to preliminary statistics from China’s General Administration of Customs, in 2024, China’s cross-border e-commerce imports and exports reached RMB 2.63 trillion, an increase of 10.8%. Over the past five years, China’s cross-border e-commerce trade scale has grown more than tenfold. As of now, the number of cross-border e-commerce enterprises in China has exceeded 120,000, and these enterprises have accumulated over 30,000 overseas registered trademarks. Therefore, for the Chinese market, cross-border e-commerce has become an important channel for Chinese enterprises to “go global.” Using cross-border e-commerce channels to “go global” has also become the “spring” for many enterprises.

III. Choosing the Right Cross-Border E-Commerce Platform

Choosing the right cross-border platform is a key step in starting a global e-commerce journey. By clarifying your own needs, understanding mainstream platforms, paying attention to key factors, and taking practical action, you will be able to find the most suitable cross-border platform for yourself and achieve global market expansion and business growth.

1. Determine the Target Market

Before starting e-commerce business, enterprises should conduct market research. Market research helps enterprises understand the needs, competitive environment, culture, consumption habits, and laws and regulations of the target market. Through research and analysis, determine the target market suitable for their development. Markets such as Europe, America, Southeast Asia, Japan, and South Korea each have different characteristics, and different platforms have different penetration rates and influence in different markets.

2. Clarify Your Own Needs and Positioning

First, clarify your product type — is it fast-moving consumer goods, electronics, clothing, or others? Different platforms have different product preferences, and choosing a platform with high product fit is crucial. Second, assess your budget and resources, including funds, team, logistics, etc. Some platforms may require higher investment, while others are more suitable for small and medium sellers.

3. Select a Cross-Border E-Commerce Platform

This article provides a comparison of mainstream cross-border platforms for your selection.

Mainstream cross-border e-commerce platforms include but are not limited to: Amazon, Temu, AliExpress, TikTok, Shein, eBay, Shopee, Lazada, Alibaba International Station (Alibaba.com), Wish, Ozon, Shopify, Coupang, etc.

Cross-Border E-Commerce Platform Comparison (Partial)

Platform

Platform Features

Advantages

Disadvantages

Suitable Products

Main Markets

Fees

IV. Choosing the Right Logistics Model

Choosing a logistics model that meets buyer needs while saving costs for yourself is the right logistics model.

Below is a comparison table of cross-border e-commerce logistics methods for your selection, covering common logistics methods and their characteristics:

Common Cross-Border E-Commerce Logistics Comparison

No.

Logistics Method

Features

V. What Domestic Policies Support Cross-Border E-Commerce?

With the continuous development of cross-border e-commerce, various national departments issued a series of policies in 2024 to regulate and promote the development of cross-border e-commerce.

China's Main Cross-Border E-Commerce Policies

Date

Department

Policy Name

Key Content

VI. Regulatory Requirements of Major Destination Countries for Cross-Border E-Commerce

Cross-Border E-Commerce Regulatory Requirements in Selected Countries

Country

Regulatory Content

United States

VII. Customs Clearance Process for Cross-Border E-Commerce

Cross-border e-commerce involves international transactions conducted on e-commerce platforms, including four customs clearance processes: declaration, payment, logistics, and customs clearance. Merchants need to strictly follow customs regulations at each step to successfully complete customs clearance procedures.

1. Declaration Stage.

Merchants need to register on the website of the General Administration of Customs of China to obtain operating rights and a registration number, then enter product information into the electronic port system. During this process, merchants need to provide basic product information such as name, price, brand, origin, and specifications, and upload product images, videos, and other related materials to the system.

2. Payment Stage.

After completing product information entry, merchants need to pay relevant taxes and duties. Generally, cross-border e-commerce taxes include value-added tax (VAT), consumption tax, and customs duties. Merchants need to make payments according to customs regulations.

3. Logistics Stage.

Merchants need to choose a reliable logistics company to transport goods overseas. During this process, merchants need to provide relevant documents such as product lists and invoices for customs verification and review.

4. Customs Clearance Stage.

After goods arrive at the destination country’s customs, customs will inspect and verify the goods. If the goods meet requirements, customs will release them and complete the clearance procedures. If there are issues with the goods, customs will require the merchant to make corrections and improvements.

VIII. Taxpayer Exporting Goods Through Overseas Warehouses: Process for Applying for Export Tax Rebates (Exemptions)

Taxpayers exporting goods through overseas warehouses may apply for export tax rebates (exemptions) based on relevant materials such as the export goods customs declaration form immediately after the goods have been customs cleared and departed. In specific operations, taxpayers should determine the specific application method based on the sales status of the goods: if the goods have been sold at the time of applying for the export tax rebate (exemption), handle it according to current provisions; if the goods have not yet been sold, handle according to the “tax rebate upon departure, tax calculation upon sale” method, i.e., first pre-apply for the export tax rebate (exemption) based on the customs declaration form and other materials (hereinafter “export pre-tax rebate”), and then calculate the tax based on the actual sales situation later.

IX. How Cross-Border E-Commerce Sellers Can Build Their Own Advantages

With the mature development of cross-border e-commerce and increasing consumer demand for and awareness of brands, cross-border e-commerce sellers can build competitive advantages through strategies such as brand building, operational capability improvement, industry insight, and policy utilization.

1. Brand Building:

Create a unique brand: Use brand stories and cultural effects to gain more platform traffic support and consumer loyalty, thereby building higher competitive barriers.

Social media operations: Interact with users through social media to enhance brand awareness and loyalty.

Word-of-mouth marketing: Encourage users to share shopping experiences to create positive word-of-mouth.

Quality assurance: Ensure product quality, provide detailed product information and genuine reviews, and build consumer trust.

2. Operational Capability Improvement:

Establish standardized operating procedures: Establish and improve standardized operating procedures to enhance operational efficiency and quality.

Localized operations: Make localized adjustments in language, payment, logistics, etc., for the target market to enhance user experience.

Precision marketing: Use big data to analyze user needs and conduct targeted advertising and social media marketing.

Efficient logistics: Cooperate with high-quality logistics providers to provide fast and reliable delivery services and optimize warehouse management.

Quality customer service: Provide multilingual, multi-channel customer service to promptly resolve user issues.

Digitalization and technology application: Enhance big data processing capabilities and digitalization levels, adopt intelligent systems to improve operational efficiency, such as智能 customer service and automated warehousing.

3. Industry Insight:

Enhance industry awareness: Deeply understand and grasp industry trends, improve market awareness, and make more effective business decisions.

Consumer awareness: Focus on consumer needs, use big data analysis to enhance understanding of consumers, and provide products and services that better meet market demand.

4. Policy Utilization:

Policy dividends: Fully utilize cross-border e-commerce policies in various countries, such as tax incentives and customs clearance facilitation.

Compliance operations: Comply with the laws and regulations of target markets to avoid risks.

X. Risks Faced by Cross-Border E-Commerce Sellers in Operations

Cross-border e-commerce sellers face multiple risks in their operations and need to pay special attention to the following:

Tariffs and Taxes: Tariff and tax policies in different countries may change frequently, affecting costs and profits.

Product Compliance: Products may not meet the safety, environmental, or labeling requirements of the target market, leading to fines or removal.

Intellectual Property: May face intellectual property infringement lawsuits or be sued for infringing others’ rights.

2. Logistics and Supply Chain Risks

Logistics Delays: International logistics is affected by weather, customs, and other factors, which may cause delays.

Supply Chain Disruptions: Supplier issues or natural disasters may lead to supply chain disruptions, affecting inventory.

High Logistics Costs: International transportation costs are high, especially for small sellers, which may compress profits.

3. Payment and Exchange Rate Risks

Payment Security: Cross-border payments may face risks of fraud or payment failure.

Exchange Rate Fluctuations: Exchange rate fluctuations may affect revenue and profits, especially when not settling in local currency.

4. Market and Competition Risks

Market Demand Changes: Target market demand may change rapidly due to economic, cultural, and other factors, leading to slow sales.

Intense Competition: The international market is highly competitive, and price wars and product homogenization may compress profits.

5. Customer Service and After-Sales Risks

Cultural Differences: Cultural differences may lead to communication difficulties, affecting customer satisfaction.

Return and Exchange Disputes: Cross-border return and exchange processes are complex and may lead to disputes, increasing costs.

6. Technology and Data Risks

Network Security: E-commerce platforms may suffer hacker attacks, leading to data breaches or financial losses.

System Failures: Technical failures may lead to order processing delays or data loss, affecting operations.

7. Brand and Reputation Risks

Brand Infringement: Brands may be counterfeited, damaging reputation and market position.

Negative Reviews: Bad reviews or negative publicity may affect brand image, especially with rapid spread on social media.

8. Financial and Capital Risks

Capital Chain Breakage: Cross-border transaction payment cycles are long, which may lead to tight capital chains.

Tax Compliance: Tax requirements in different countries are complex, and non-compliance may lead to fines.

9. Political and Economic Risks

Trade Policy Changes: Trade wars or policy changes may increase tariffs or restrict imports.

Economic Fluctuations: Economic instability in the target market may affect consumer purchasing power, leading to declining sales.

Cross-border e-commerce sellers need to comprehensively address risks in policy, logistics, payment, and market areas. Through advance planning, risk management, and flexible strategy adjustments, they can reduce potential losses and ensure stable business development.

XI. How Cross-Border E-Commerce Sellers Should Operate in Compliance

Cross-border e-commerce sellers should comply with the laws and regulations of the target market and ensure their business operations meet international standards. The following are key steps:

1. Understand Target Market Regulations

Tariffs and Taxes: Familiarize yourself with the tariff, VAT, and other tax policies of the target market to ensure accurate declaration and payment.

Product Compliance: Ensure products meet local safety, environmental, and labeling requirements to avoid removal or fines due to non-compliance. Different countries have strict standards for product quality and safety. For example, the EU’s GPSR regulations and the US Consumer Product Safety Commission’s (CPSC) regulatory standards.

Intellectual Property: Sellers need to ensure the trademarks they use are legal, avoid infringing others’ trademark rights, and actively register their own trademarks to protect their brands. Also need to ensure compliance with patent and copyright regulations.

2. Compliant Payment and Settlement

Compliant Collection Methods: Ensure the use of legal collection methods to avoid违规 operations.

Capital Return Path Planning: Reasonably plan the capital return path to ensure compliant operations.

Anti-Money Laundering and Anti-Fraud: Comply with anti-money laundering and anti-fraud regulations to ensure payment security.

3. Logistics and Customs Compliance

Customs Declaration: Accurately declare goods information to avoid delays or fines due to incorrect declarations.

Logistics Compliance: Choose compliant logistics service providers to ensure the transportation process complies with international and local regulations.

Export Tax Rebate Policy Understanding and Application: Understand and apply for export tax rebate policies to ensure compliant operations.

Duty-Free Policy Utilization and Compliant Operations: Reasonably utilize duty-free policies to ensure compliant operations.

4. Data Protection and Privacy

Data Protection Laws: Comply with the data protection regulations of the target market, such as the EU’s GDPR, to ensure user data security.

Privacy Policy: Formulate and publish a privacy policy, clearly stating the methods of data collection and use.

5. Consumer Rights Protection

Return and Exchange Policies: Provide return and exchange policies that comply with local regulations to protect consumer rights.

Product Liability: Ensure product quality to avoid legal disputes arising from quality issues.

6. Advertising and Marketing Compliance

Advertising Laws: Comply with the advertising regulations of the target market to ensure truthful and lawful advertising content.

Social Media Compliance: When promoting on social media, comply with platform rules and local laws.

7. Tax Compliance

Tax Declaration: Declare and pay taxes on time to avoid penalties for tax issues.

Tax Planning: Reasonably conduct tax planning to reduce the tax burden.

8. Contract Performance

Timely Delivery: Timely fulfill the obligations of the sales contract between both parties and deliver products or services on time.

Product Delivery: Products delivered to consumers should be consistent with their descriptions to avoid false sales.

9. Regular Review and Compliance Checks

Internal Review: Conduct regular internal reviews to ensure business operations are compliant.

External Consultation: Engage professional institutions to conduct compliance checks to ensure compliance with the latest regulations.

10. Training and Culture Building

Employee Training: Regularly train employees to ensure they understand and comply with relevant regulations.

Compliance Culture: Establish a compliance culture to make compliance a core part of the enterprise’s operations.

Cross-border e-commerce sellers need to fully comply with the laws and regulations of the target market, ensuring compliance in all aspects from products, payment, logistics to data protection. Through registration, tax compliance, consumer rights protection, and other measures, sellers can effectively reduce legal risks and ensure long-term stable business development.

RESEARCH TEAM

YE Peng Senior Partner

Ye Peng is a Senior Partner/Attorney at Long An (Guangzhou) Law Firm, Secretary of the Communist Party Committee of Long An Guangzhou, Senior Researcher at the Long An Bay Area Criminal Prevention and Control Research Center and the Long An Bay Area ASEAN Legal Research Center, Director of the E-Commerce Legal Division, member of the Information Technology Construction Committee of Guangdong Bar Association, member of the Internet Finance Law Committee of Guangdong Bar Association, Deputy Director of the Corporate Compliance Committee of Guangzhou Bar Association, Legal Advisor to Yangjiang E-Commerce Association, Head of the Cross-Border E-Commerce Legal Service Center, and Arbitrator of Yangjiang Arbitration Commission. Attorney Ye has extensive practical experience in civil and commercial matters and corporate compliance, with superb professional skills and a solid work style. Since 2018, he has been involved in e-commerce industry legal services, taking the lead in establishing the E-Commerce Legal Service Department and Cross-Border E-Commerce Legal Service Center, providing comprehensive one-stop legal services for cross-border e-commerce enterprises. He has participated in nearly 800 e-commerce litigation cases and serves as legal counsel to multiple e-commerce enterprises. In corporate compliance, Attorney Ye has extensive experience providing legal risk analysis, negotiation skills advice, contract negotiation management, compliance audits, IP compliance, data compliance, and import-export customs compliance services.