On WeChat, Daigou Get Creative to Skirt New E-Commerce Law

What happened to Daigou on the first day of 2019?” was the tempting headline of a post that drew more than 100,000 views in a little more than a day on Chinese social media giant WeChat this week. The article, on popular blog InsDaily, illustrated vividly how daigou is going to great lengths to get around a new law.

These cross-border personal shoppers, who buy clothes, accessories, and cosmetics in the West for private and profitable resale within China, came under increased government scrutiny on New Year’s Day. A new e-commerce law went into effect that requires online sellers to disclose their qualifications and their business licenses, among other information. Daigou trading exists in a grey area, without sellers or buyers paying customs duties or taxes, and can also be prone to fraud.

Photo: InsDaily

Some daigou attempted to avoid detection of their efforts by offering products with hand-drawn pictures and fake names. In the image above, American skincare brand Clinique is depicted as a yellow square and high-end cosmetic brand La Mer has a Chinese name, “La Mei.” Many daigou also used foreign languages like Russian, Korean and Japanese to introduce the products, intentionally avoiding the mentioning of brand name, product style, and price. Others only used WeChat voice message to communicate with clients, or used Alipay for transactions to avoid WeChat scrutiny.

One daigou, Ruby Liu, who is based in London, told us that she has heard about a rumor WeChat would be cracking down and started to post drawings instead of real product pictures “just to be safe.” Another daigou in his thirties, said he hasn’t seen the effect of this crackdown, and his posts of real product pictures have yet to be taken down. (He said: “drawings are used as a marketing gimmick to get people’s attention.”) 

Although the law isn’t entirely clear, which is why daigou are utilizing a variety of methods to avoid being noticed, platforms such as WeChat that daigou operate on could be liable and face penalties if proven to be involved in illegal activities.

Jing Daily reached out to Tencent, owner of WeChat, for comment, but has yet to hear back by the time of publication. According to Chinese media Beijing Youth Daily, Tencent said the company never encouraged conducting commercial activities using personal WeChat accounts, but the company has not implemented regulations against WeChat daigout yet. Tencent added it has received many complaints reported by users that involved the sale of counterfeit goods, fraud and commercial infringement, which will be handled according to relevant laws and user agreements.

While daigou seem to be aware of the changes, some are at a loss on where to start to comply with the law. Liu, who started a daigou business when she was an undergraduate and has been doing it to support her expenses living abroad, is unclear about where to start the license registration process and is still waiting to see what her other daigou friends are doing next. “For now, staying low seems to be the best temporary solution,” she told us.

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E-Commerce, Legal, Policy, Trending in China