Anybody who has ever attended a cross-cultural training course or read about business culture in the East Asia region is very likely to have encountered the idea that East Asian cultures are more comfortable with ambiguity in the business world than their contract-focused Western counterparts. While these differences may be overstated (especially in more recent times), it has been my experience that Western businesses crave certainty, whereas Chinese businesses are more comfortable leaving things open to interpretation and negotiation. One of the challenges that I have faced over 20 years of working in China, is managing the demands for a definite answer from my agents and clients overseas with the absence of any such thing in China!

In the run up to the 2008 Olympic Games in Beijing, regulations were introduced regarding transportation in the city and our agents needed to know how they would affect our ability to provide services to their clients. In addition to dealing with household goods moving at the time, Trans Dragon was also managing an FFE project for a major U.S. hotel chain right in the middle of Beijing. When the detailed transportation regulations came out, it became clear that our trucks that had been carrying out this project would not be able to access the city center during daylight hours. Trucking operations in the evening however would be allowed, but restricted to “essential” services. The definition of what would be considered “essential” would be left to the transport police on the street. Nobody was provided with a list of what would be considered “essential”.

When dealing with large U.S. corporations in particular, it is very important to them that they are not seen to be involved in any illegal or irregular activity. The only response we could provide them when asked if it was definitely legal to send trucks to make the deliveries at night was, well, it’s not definitely illegal! In the absence of a definitive statement that the operational activity would be fully within the special regulations, some (including the hotel chain) requested that we suspend operations. 

Other organizations were more flexible. We advised that there was a possibility of being fined if we carried out the work, but we would do our best to explain to the authorities that the job was “essential” if the need arose. They decided it was worth the risk. On the opposite side, one individual at a large U.S. firm demanded that we provide a guarantee that the work was fully within the regulations and threatened to take their business elsewhere if we couldn’t. I recall an exasperated email from this person saying “there must be a specific law written down somewhere! There has to be or how does anyone know what’s allowed!?!”

On the removals side, the customs regulations on the import and export of HHGs at a national level run to less than four pages. It is up to each regional customs office to interpret and apply those regulations and, importantly, how they disseminate this information. In Beijing for example, customs officers hold a meeting with the main brokers and sometimes put a notice on the message board in the foyer of the customs office. Nowadays we can take a quick snapshot of the notice with our mobile phone, but in the past, we would just have to communicate what we had been told without any documentation to back it up.

Although different customs offices can interpret the regulations themselves, over time, the rules have become more and more consistent across the country. However, you can still come across some significant differences. For example, the national regulations state that only “long-term” residents can import a household goods and personal effects shipment into China. It is then for the customs office to decide what is meant by long term, and how it can be proved.

For pretty much all customs offices now, “long-term” means that the shipper (if a non-Chinese citizen) has a residence permit of a year or more stamped in their passport. This requirement for a 365-day valid residence permit was supposed to be a key regulation, but because of an anomaly in the application process, most expat employees used to only be able to obtain a 360-day (ish) residence permit. Based on the exact letter of the regulation as given by the customs office, a majority of imports over the years would not have been allowed.

Most customs offices were aware of the issue with the residence permit validity, and they wouldn’t strictly enforce the 365-day rule, but in some of the smaller customs offices in remote areas where they were unused to dealing with HHG shipments, it caused a few problems and shipments were sometimes declined for import, or more often, subjected to full customs duty. Our challenge was how to ensure that our agents and their clients are aware that there is an issue like this without causing unnecessary complications in an already stressful move process.

The situation is similar where the definition of personal effects is concerned. The key word (as in some other jurisdictions) is “reasonable”. Is it reasonable to consider that an item is a personal effect? Is it reasonable to have a certain quantity of a particular item? If the answer to either of these questions is no, then the import may be prohibited (even though it may not be a specifically prohibited item), or have duty charged on it. 

For example, if you ask five different removals companies in China what the maximum number of books that can be imported with a shipment is, you will probably get five different answers. The one correct answer is that (for non-Chinese shippers) a “reasonable” number can be imported duty free. What might be reasonable for one shipper, though, may not be for another. What often happens is that each mover will give a figure based on their general experience, even though it is not strictly a customs regulation. What is better is when we have plenty of advance notice that there is a significant number of books in a particular shipment, and then we can discuss this with Customs and the shipper to see what would be accepted in that specific circumstance.

From the outside, China is often perceived as a place where rules are strict and penalties for non-compliance harsh, but in fact, there is more flexibility in the system than is often given credit for. Over my time with Trans Dragon I have been able to visit our agents’ offices in Europe and the U.S. and talk directly about where there is flexibility in the process and where there most definitely isn’t. Having an understanding of this nuance is invaluable if you are dealing with shipments to China.