May 21, 2018
Seventeen people have been arrested and RMB 200 million (US$31.5 million) worth of wines seized after officials in Fujian and Guangdong provinces dismantled a sophisticated ‘one-stop-service’ smuggling ring that was operating in four different cities.
The haul included 13,650 cases of smuggled wines and the evaded tax amounted to more than RMB 50 million (US$7.8 million), according to a report by state news agency China News.
The value of the haul would make it the biggest smuggling wine case busted since 2017 when police officials uncovered 360 tonnes of smuggled wines worth RMB 230 million (US$33.8 million), including about 4,000 bottles of fine wines such as first growths Lafite, Mouton Rothschild and Pomerol’s Petrus, as previously reported by dbHK.
The operation was carried out after nearly a year of investigation when Customs officials in Xiamen, a port city in China’s eastern Fujian province, found that a trading company in the city was suspected of under-declaring imported wines.
Further investigation revealed that the company provided a, “Customs clearance guarantee service” that involves a few more companies in Guangdong’s Guangzhou, Shenzhen and Zhuhai cities, all close to tax-free Hong Kong and Macau across the border.
Between January and May this year, the police said an unnamed wine importing company in Zhuhai would import wines overseas, and sell them to companies in Guangzhou and other parts of China. According to the report, the company would under-report the value of the wine by as much as 60%, and it was believed to have shipped in more than 600 containers during this period.
It’s unknown at the moment what the wines smuggled in are but based on images released by the police, one photo showed bottled Château Laroche Prestige 2009 from the Côtes de Bourg.
The case is the latest wine smuggling bust after mainland China tightened up cross-border security checks to stamp out the parallel trading of imported wines from Hong Kong and Macau, which enjoy zero tariff on imported wines.
Wines imported to mainland China through legal channels are subject to close to 50% taxes including import tariff, VAT and excise tax. Based on figures released by HKTDC, during the first half of 2017, Hong Kong re-exported 47% of its wine imports, and 91% of the re-exports were destined to mainland China and Macau.
Source: The Drinks Business
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