Customs duties encourage smuggling

Chinese authorities seize top French and Australian wines.

Chinese custom goes against dark imports from Hong Kong (Credit: Kuehne & Nagel)
Chinese custom goes against dark imports from Hong Kong (Credit: Kuehne & Nagel)

The possibility of duty-free imports of top wines from France and Australia in Hong Kong is fuelling smuggling into mainland China. 

Authorities in Shenzhen have seized 4,174 bottles of wine, champagne and whisky that were intended to enter the mainland illegally from Hong Kong. The smuggled wines include Châteaux Lafite Rothschild and Mouton Rothschild as well as Penfolds from Australia.

The goods declaration listed 18.57 tonnes of imported rubber and plastic buttons. According to Vitisphere, the 707 smuggled Penfolds bottles can fetch the equivalent of about €652 per bottle in mainland China, a total of about €460,000. 

The background for the increasing smuggling of goods is, among other things, the 218 percent tariffs imposed by mainland China on Australian wines. The legal imports of wines are correspondingly low here, while Australian imports in Hong Kong increased by more than 340 percent to an estimated HK$1.04 billion (about €113 million) between January and May 2021. 

It seems likely that it is not only the revitalised market that is boosting imports in Hong Kong, but also the prospect of some criminals doing lucrative business on the mainland. ITP

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