Out-Law / Your Daily Need-To-Know

Amazon "to open logistics warehouse" in Shanghai's free trade zone

Out-Law News | 25 Aug 2014 | 11:18 am |

Online retailer Amazon is to establish a presence in Shanghai's new free trade zone, which was set up last year to encourage international investment in the area, according to press reports.

The Financial Times said that Amazon would be able to offer lower shipping charges and faster delivery to its small Chinese customer base once it opened its planned logistics warehouse within the 11 square mile zone.

"We're going to have lower shipping charges, faster delivery coming into the free-trade zone, so there are going to be many benefits," it reported that Diego Piacentini, the vice-president of Amazon's international consumer business, told Chinese television.

Amazon has not confirmed when it will begin operating in the free trade zone.

Shanghai's free trade zone was established as a pilot project in September 2013 with the idea that, if successful, the idea could be replicated elsewhere in China. Within the free trade zone, foreign businesses operating in a range of sectors including financial services and technology, media and telecoms (TMT) can operate with fewer regulatory restrictions than currently apply elsewhere in the country.

A 'blacklist' of activities set by the Chinese government prohibits firms from carrying out certain types of business within the free trade zone. In the TMT market, activities that firms are not allowed to carry out include investment in stem cell technology development and application or genetic diagnosis and treatment technology and development. Investment in news agencies, books or newspapers; audio-visual products and electronic publications; production services; cinema infrastructure or operations; and broadcasting is also prohibited or restricted.