|Names||Daigou, Overseas personal shopper, Professional shopper|
Daigou (Chinese: 代购; pinyin: dàigòu; literally: 'Surrogate Shopping') is an emerging form of cross-border exporting in which an individual or a syndicated group of exporters outside China purchases commodities (mainly luxury goods, but sometimes also groceries such as infant formulas) for customers in China, in order to either illegally or legally use loopholes to circumvent import tariffs imposed on overseas goods.
Daigou shoppers typically pose as ordinary shoppers and purchase the desired goods in a region outside China, after which they return the goods to China by post, or by posing as normal tourists while carrying the purchases in quantities under the threshold for customs declaration or sometimes concealing the purchased goods from the customs authorities altogether, and then relay the purchased goods to the actual buyers while charging an extra more than the cost of the purchase in order to make a high profit. Daigou activities can range from illegal criminal offences such as smuggling, tax evasion, and fraud to the legal exploitation of the loopholes in the form of tax avoidance, depending on the specific case.
Daigou purchases are often made in luxury brand boutiques in major fashion cities like Paris, London, New York City, Hong Kong, Tokyo and Seoul. Some daigou operators use Weibo and WeChat to communicate with their clients. The large demand for daigou service is due to perceived high import tariffs on luxury goods and concern over unsafe products, especially food safety problems,
Daigou sales across sectors total $15 billion annually. In 2014 the value of the daigou business just in luxury goods increased from CN¥55 billion to CN¥75 billion yuan (US$8.8 billion to $12 billion).
A 2015 survey of Chinese online luxury shoppers found that 35% have used daigou to purchase luxury goods online, while only 7% used the website of the brand they are buying, or think they are buying. Approximately 80% of Chinese luxury purchases are made abroad.
Daigou syndicates are often involved in illegal hoarding and stockpiling of goods in large quantities, often infuriating local customers for the shortage of goods and disruption incurred to the markets. This has also prompted several governments to take actions against Daigou smuggling and hoarding.
The Australian government has rolled out numerous rounds of policies several times and imposed multiple restrictions on Daigou purchases of baby formula, and yet many Daigou smugglers still come up with new ways to circumvent those restrictions. In early 2017, 23 of these so-called "Daigou" were arrested for involvement in a smuggling ring in US. In late 2017, Melbourne police cracked down on a syndicate of "Daigou" smugglers and arrested seven of such smugglers after a months-long investigation. In early 2019, six of these so-called "Daigou" were arrested in Australia over baby formula smuggling ring.
The burgeoning daigou trade and organised crime gangs have been blamed for a 16 per cent spike in shoplifting that cost Australian retailers at least $2.26 billion in 2018-19.
It is reported that 2019–20 coronavirus pandemic provides a new opportunity for Australian daigou shoppers to re-sell into the China market. "The virus crisis, while frightening, has a silver lining". The staff of the Chinese property developing group 'Greenland' were, "sent on a mission to find bulk supplies", which were flown to China. The Sydney property developer 'Risland', a subsidiary of Country Garden Holdings, sourced 82 tonnes of supplies, which were subsequently airlifted to Wuhan. A "former Chinese military man (was) behind export of tonnes of medical supplies" and in the calling of, "overseas Chinese in Australia to take action to contribute money, supplies and your kindness to your home country". In Australia these diagou shoppers are stripping shelves, leaving Australians short of essential supplies. On 24 March, Prime Minister Scott Morrison said that the commonwealth government will attempt to prevent individuals from exporting and re-selling prevention-related goods.
Starting from 2012, the New Zealand government has been regularly cracking down and sometimes outright banning unauthorized export of consumer goods through unregistered channels.
Regular Asian customers often became subject to gratuitous suspicion and even outright discrimination due to the disruptive nature of the rampant purchases of luxury goods and other consumer goods made by Daigou hoarders and smugglers, who are mostly Asians. Asian-American sales associates at Macy's Herald Square sued Macy's for racial discrimination in September 2017, alleging that store managers instructed sales associates not to sell more than one unit to any single Asian customer, and that they were fired when they spoke up about the alleged discrimination.
In June 2019 naval personnel from a Chinese warship berthed in Sydney Harbour, Australia were photographed unloading from a large van, boxes of baby formula and other products, to carry onto the ship.
Some Daigou service providers fraudulently sell counterfeit products that have been altered to appear purchased abroad from legitimate sources.
In 2012, a former flight attendant and professional Daigou smuggler was sentenced by a Chinese court to 11 years in prison convicted of cross-border smuggling, domestic smuggling of overseas goods through unregistered channels, defrauding the customs authorities, willful violation of Customs laws, and evading more than 1,000,000 RMB worth of taxes.
On January 1, 2019, China officially rolled out a new e-commerce law, the first of its kind to directly regulate Daigou activities. Under the new law, all Daigou participants will be legally required to register as e-commerce operators and acquire licenses in both China and the country where they shop, making their business subject to taxation in both China and the region where they purchased goods. Any e-commerce platform and seller could be fined 2 million yuan and 500,000 yuan respectively, and possibly face criminal charges, if they are found guilty of smuggling, tax evasion and willful violation of the new e-commerce law.
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