Our man in Beijing

Meet Leo van Veen, the Dutch customs attaché in China. “Cooperation is essential if we are to manage the huge and growing flow of goods with a limited number of staff.”

Recently, Leo van Veen, who has been a customs attaché in China since 2014, signed up for another two years. Together with his colleagues from the embassy and his local counterparts, he tries to deal with typically 21st century challenges, such as the infringement of intellectual property rights and the explosive growth in internet shopping. “Cooperation is essential if we are to manage this huge flow of goods with a limited number of staff.”

It was no surprise that Customs chose Van Veen for a post in the Far East. For many years he worked for the International Affairs department in the Ministry of Finance’s Directorate General for Taxation. Van Veen: “In this capacity, I visited many European and non-European countries and worked for the OECD and the World Customs Organization. These projects lasted between a few months and a few years. Opportunities to be seconded for a longer period also came up but they did not suit my family situation. The chance for me to become a customs attaché in Beijing came at exactly the right moment. And thanks to my involvement in the cooperation between the Dutch and Chinese customs services, which started in 1991 and focuses on the exchange of knowledge, I was already quite familiar with the country.”

Mediating role
Van Veen’s two-man group forms an independent department within the Dutch embassy, but still falls under the Economics cluster. He sees it as a logical structure, certainly with a view to trade facilitation. “We must try to create opportunities for businesses. And companies know where to find the embassy and consulates general in Shanghai, Guangzhou, Hong Kong and Chongqing. The economic department has the most contacts, of course, but they also consult me on a regular basis. As an attaché, I can’t solve problems but I can play a mediating role. For example, if there is a container with perishable goods sitting on a quay, I or my assistant can ask our Chinese colleagues what is going on and whether we can do anything. But that’s not the type of issue we get involved in every day.”

Useful visit
According to Van Veen, anyone who does not yet have a foothold in China ought to consider taking part in a trade mission. “They really open doors. You can be matched with a potential Chinese partner, with customers and resellers of your product. And you can find out about business practices in the country, such as how to go about becoming recognised as an AEO company. Or how to register your intellectual property rights to prevent someone from stealing your product. A trademark filed in Europe is not automatically protected in China. Furthermore, when participating in an exhibition or a trade fair, contact with the organiser is indispensable. The economic department can provide advice on this. The organiser will then ensure that the temporary import of your product is officially arranged on the Chinese side.”

Van Veen also contributes to this type of event. “During the last major trade mission, I visited the port of Shanghai with part of the group and gave a presentation on customs cooperation between Europe and China. What can entrepreneurs expect, and in which pilot projects can they participate? Even companies that are already established are eager to use this type of opportunity to find out what’s in the pipeline and how they can respond to it.”

On the right track
Does Van Veen encounter genuine cultural differences in China? “Well, first of all, language is a barrier and contact in itself often differs from the Netherlands. At the end of the day, though, you can focus on the differences between our countries, but actually we both face similar challenges. Cooperation is essential if we are to manage the huge and growing flow of goods with a limited number of staff. Among other things, this includes our Twinning cooperation on maritime and air transport of goods between Shanghai and Rotterdam and Guangzhou and Schiphol. This will allow for processes to be centralised and best practices to be exchanged.”

The public-private pilot project Smart & Secure Trade Lanes – SSTL in short – is another good example of EU-China cooperation. Van Veen: “With SSTL, we are trying to map entire logistics chains, assess the risks and identify reliable companies. In 2006, I was involved in the initial negotiations for the project on behalf of the Netherlands.” The two partnerships reinforce each other, says Van Veen. “After all, the various lines were already in place, and both services were familiar with one another. SSTL initially focused on maritime transport. Together we later took the initiative to conduct a pilot project on air cargo, in collaboration with the Chinese Guangzhou airport. And now the project has been expanded to include the rail modality. There are major advantages to be gained from logistics. Many countries benefit as a result of reducing the travelling time of products destined for the West and minimising customs controls.As an eastern gateway to Europe, Poland plays a particularly important role. The plans for the railways also affect the Chinese government’s Belt and Road Initiative. Dozens of countries are involved in the design of this ‘new Silk Road’.” 

Risk assessment
The Asian country is making considerable progress in other areas too. “In terms of automation, China is very advanced,” says Van Veen. “And there is a significant willingness to invest. They are working hard on IT solutions in the logistics chain, for example; a few years ago, a large airport introduced a robot that provides information to travellers. And everyone in China organises everything by phone. Internet ordering has taken off on an unprecedented scale and cars constantly buzz around the streets, delivering parcels. After all, China is the world’s second largest economy and perhaps the biggest when it comes to e-commerce. For recipient countries, including the Netherlands, this large volume of parcels is a source of concern. That is why we are also looking for cooperation in this area –from the World Customs Organization and the EU, as well as bilaterally. Last year, we organised a joint seminar in the Netherlands on the risks associated with this enormous flow. Are there, for example, big differences between the declared customs value and the actual product, which results in the Treasury losing out on money?”

“Of course, we are also examining non-fiscal risks. At the end of the day, we need to know whether the content of a product corresponds to the packaging statement. Are there any harmful substances in it, how can we recognise counterfeiting? Both countries attach a great deal of importance to the integrity of the goods and are working hard on this area. Collaboration with other enforcement agencies is essential in this respect. What makes this kind of challenge even more exciting is that Chinese customs are in the middle of a merger with the AQSIQ quarantine service, comparable to our Food and Consumer Product Safety Authority and Human Environment and Transport Inspectorate. The reorganisation that this entails equates to a substantial increase in the number of staff.”

Trust
Another good example of the steps that China is taking,says van Veen, concerns the trade in wildlife products. “The country has gradually restricted the practice. First of all, imports were prohibited, and then processing soon followed. The process of recycling materials such as waste paper, which is transported in large quantities to China, is also subject to stricter controls. It must now have a limited degree of inherent pollution. If the standard is breached, the import of that consignment will be refused and it may be returned. Since 31 December, imports of certain types of paper have been banned completely. It is, however, a sensitive issue as the restrictions have hit some companies extremely hard. In addition, a number of global recycling streams, including plastic waste, have come to a complete standstill. Together with Brussels and the competent enforcement services in the Netherlands, we are examining how best to cope with this type of intervention. Thus, we can try to influence the moment at which the flows are stopped, or argue for even clearer guidelines.”

A solid basis of trust is needed in order to resolve this type of difficult situation. The seed for this was planted at the beginning of the cooperation in 1991. “Garderen, the small town where most of the training was given, is still a household name for many Chinese customs staff,” says Van Veen. “The 1,300 or so employees that our service trained there are generally found in senior positions within Chinese customs now. It is great to see that our collaboration has lasted so long and has been so successful. And whereas our Chinese colleagues initially came to gain knowledge from us, now there is a much better balance. Today we can learn from one another.”

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