China Duty Free Group Welcomes New Hainan Domestic Duty Free Regulations

The country's leading travel retailer, China Duty Free Group (CDFG), has welcomed last week's promulgation of a new offshore shopping policy for the resort island of Hainan, which will allow domestic travellers to shop duty free.

The policy and its implementing rules were passed by the Ministry of Finance and the General Administration of Customs of China on 24 March.

The company described the policy as "another landmark event for Hainan as well as China". China Duty Free's Sanya duty free store is the only shop on Hainan currently qualified to implement the new policy, it added.

CDFG President Lu Lu said: "Establishing the Sanya duty free store not only effectively fills the gap in Hainan's top-grade tourist shopping market but also promotes Hainan's tourism infrastructure, gearing it to gain international recognition.

"With the implementation of the new policy, Sanya duty free store will welcome tourists from both home and abroad with a first-class shopping environment, rich commodities and brands, preferential duty free prices and superb customer service."

The Sanya store covers an overall business area of 7,000sq m. The design integrates international factors with Hainan local elements through the design of the façade and various interior areas.

"We are expecting mainland Chinese to buy duty free in our shop starting from 20 April," China Duty Free Group Marketing Director Antonio Hao told The Moodie Report.

The store features all major categories including perfume & cosmetics, jewellery, watches, clothing, leathergoods, sunglasses, travel accessories and Chinese/Hainan specialties.

The list of products includes over 10,000 items from more than 100 leading international brands. Duty free retail prices in the Sanya store are 10%-35% lower than in domestic department stores and on parity with regional duty free pricing, the company said.

China Duty Free said: "Sanya is becoming the duty free store with the largest scale, most complete brands and best environment in [mainland and Hainan] China. Sanya duty free store intends to become the most attractive high-end shopping mall in Sanya and Hainan."

'A COMPLETELY NEW SHOPPING EXPERIENCE'

In accordance with the new policy, mainland Chinese, foreign tourists and Hainan Island residents can purchase duty free items from the store starting 20 April.

They must provide valid identity documents, and departure date and flight information, before they leave the island.

"This allows customers to enjoy duty free shopping and its benefits without going abroad," China Duty Free noted.

"Hainan Island has become the fourth area in the world to implement offshore [domestic] duty free shopping policies, after Okinawa island in Japan, Jeju island in Korea and the Matsu and Jinmen islands of Taiwan."

The new policy allows mainland Chinese and foreign tourists to enjoy two offshore duty free shopping opportunities every calendar year (though only one for Hainan Island residents).

Each time, a customer's total purchasing amount must not exceed RMB5,000 (US$760), though he or she can buy one extra product whose unit price is more than RMB5,000 after a certain amount of import duty is paid.

A customer who purchases an item at the Sanya store later collects it at the designated pick-up counter in the domestic departure lounge at Sanya Phoenix International Airport.

China Duty Free Group said it is sparing no effort to develop a high-class luxury offer in Sanya.

"CDFG Sanya duty free store is actively making preparations, ranging from commodity supply, to personnel, market promotion and information system updates to cope with possible passenger flow peaks as a result of the new policy," it said.