CNY 200 million seafood smuggling ring busted in Beijing

Published on
January 8, 2020

Fifteen people accused of smuggling seafood were arrested on 7 January in a high-profile bust that took place across several warehouses and offices in the Cao Qiao district of Beijing, China.

Chinese customs authorities claim the gang was smuggling frozen seafood into China illegally from Latin America and Vietnam. Footage from TV news on China Central TV shows a large frozen goods warehouse in the outskirts of Beijing stuffed with boxes of what’s described as frozen fish, shrimp, and squid. “Squid” from the “South Atlantic” is labelled (in English) on one bag clearly visible in the footage, with the name Qingdao Ocean Fishery Co. visible on the sack. It's not clear how the seafood entered China, but the traditional “gray trade” route has been via Vietnam.

Customs authorities said the operation involved officers from Beijing as well as Jinan, Qingdao, Shenzhen, Zhejiang, and Nanning, which is the capital of Guangxi Province, on the border with Vietnam.

The gang arrested in Beijing was responsible for smuggling CNY 200 million (USD 28.8 million, EUR 25.9 million) worth of seafood according to Chinese Customs, while evading CNY 40 million (USD 5.6 million, EUR 5.2 million) in taxes, suggesting an effective tax rate of 20 percent. Taxes on frozen shrimp average 5 percent, but VAT is also applied. Reports by state media don’t explain how the figures were tabulated.

The bust appeared designed for TV news cameras, as state television had coverage of the bust, and photos in local newspapers show police and customs officers searching office desks and filing cabinets.

There may be more to come, according to a statement from the agency, as the operation was part of the Customs’ annual “lightning sword” campaign, which has the mission of cutting down on illegal seafood in the run-up to Chinese New Year, which will take place later this month.

As China goes after smugglers, it is also cutting import duties on seafood. Last year, China cut taxes for businesses in an effort to stimulate the economy, while simultaneously seeking to collect more taxes by going after smugglers of lucrative goods like seafood. Late in December 2019, the government announced a series of reductions in import duties on imported seafood in another attempt to stimulate consumer spending.

Photo courtesy of Songquan Deng/Shutterstock

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