As restriction on foreign express delivery service in China’s new Postal Law is introduced, it is abruptly criticized as ‘protectionism’ by the European Union Chamber of Commerce in China.
The revised Postal Law forbids foreign companies from delivering express mail in China. The business accounts for a big chunk of income of China’s state-owned postal system. In the first quarter, of the RMB26 billion income, RMB10 billion is from express mail delivery.
The law as it stands come into effect on October 1. The European Chamber responded that it is ‘disappointed that the new Postal Law does not allow Chinese companies and consumers full access to foreign express delivery service providers, and regrets that this may raise questions about China’s WTO commitments and contradict international best practices.’
The European Chamber interprets the new Postal Law as creating a new licensing system for express delivery services, which is a step backwards from the efficient deregulation established in China’s 2004 Administrative Licensing Law.
The European Chamber appears to be angry. It says, ‘Collectively, these measures will erode the competitiveness of foreign invested firms against their domestic counterparts in the wider express market. . . .The protectionism in this law, however, will limit the development of the country’s logistics industry and will result in fewer options and lower quality services for customers.’
China Stakes reports that as an essential part of the supply chains, the express delivery industry is increasingly important to China’s manufacturing and service firms as they move up the value chain.
And on the same day of the adoption of the new Postal Law, the State Council announced a plan to boost China’s logistics and distribution industry.