EBMA files an anti dumping complaint on chinese e-bikes.

[anotherkiwi]

The 140 page decision is out.


https://d1wa5qhtul915h.cloudfront.net/app/uploads/2019/01/Official-Journal-European-Union-E-Bike-Dumping-Case.pdf

 

[Woosh]

if you don't have time to read through 140 pages:

8. REGISTRATION AND RETROACTIVITY

...
(783) As of 18 July 2018, registration of imports for the purpose of protection against dumped imports was terminated through the anti-dumping Regulation. As far as the current anti-subsidy investigation is concerned, and in view of the above findings, the registration of imports for the purpose of the anti-subsidy investigation in accordance with Article 24(5) of the basic Regulation should also be discontinued.
(784) In this case, no provisional countervailing measures were applied. As a consequence, the Commission decided that the definitive countervailing duty shall not be levied retroactively.

Countervailing duty:

Other cooperating companies listed in Annex I: 9.2 %

plus anti dumping duty: 24.2%

 

[Wisper Bikes]

We did our best. One crazy decision that looks like it can't be changed, let's keep our fingers crossed that we do better with Brexit!

 

[tommie]

We did our best. One crazy decision that looks like it can't be changed, let's keep our fingers crossed that we do better with Brexit!

and if there was more proof we all must Leave it`s this -> https://ebiketips.road.cc/content/news/eu-to-vote-on-mandatory-e-bike-insurance-1775?fbclid=IwAR2_NOHmoRaGw2sZU7hj-rGZrV5xr45QNaqX_QpxyA3ygL5g-Uf895-slQ4

 

[Wisper Bikes]

We are fighting this as well Tommie, let's keep our fingers collectively crossed.

We are currently exhibiting in Belgium at Vello Follies, opening dealers in Belgium, Germany and Holland. Any company doing ebike business in Europe needs to have representation within the EU to fight their accesses. Worst possible scenario is if we kept EU laws here in the UK without having a seat at the table.

Hopefully we will remain so I can move all my production out of TW back to the UK again. It was great having 100% control of bike building here in Kent, it's shame we have had to move back to Asia.

 

[Woosh]

We are fighting this as well Tommie, let's keep our fingers collectively crossed.

We are currently exhibiting in Belgium at Vello Follies, opening dealers in Belgium, Germany and Holland. Any company doing ebike business in Europe needs to have representation within the EU to fight their accesses. Worst possible scenario is if we kept EU laws here in the UK without having a seat at the table.

Hopefully we will remain so I can move all my production out of TW back to the UK again. It was great having 100% control of bike building here in Kent, it's shame we have had to move back to Asia.

My Chinese competitors like PSWPower are setting up in Germany or Czechoslovakia.
They ship Chinese e-bikes and kits into the UK without charging VAT on Amazon, Ebay and online sales.
Brexit will eliminate this unfair competition because their customers will have to pay customs declaration and VAT.

 

[Wisper Bikes]

Not sure how that works. If I personally purchase products from Amazon that come from outside the UK I have to pay VAT. If I can supply a business VAT number I don't. Please would you give me details and I will do a test purchase.

Surely though that's not the point, if by leaving our friends in Europe we are penalised with duties and tariffs when selling into our largest local market, British companies like ours are forced to relocate production?

 

[Woosh]

Not sure how that works. If I personally purchase products from Amazon that come from outside the UK I have to pay VAT.

KudosDave is the expert. I bet he must feel the same as I do.
The threshold for compulsory VAT registration is £85,000.
These guys don't have to charge VAT when their turnover is under the threshold.
They just keep their sales under the threshold or worse, don't even declare.
Nobody checks parcels going from Germany to UK. Invoices are sent by emails.
These operators don't have to have commercial premises, public and product liability insurance, no VAT registration.

 

[Wisper Bikes]

As you have suggested, I agree it looks like these guys are cheating. There's not a great deal any of us can do about fraud except report it. I am sure that the same practices will exist even in a post Brexit UK. However I am referring to bona fide businesses that being forced to manufacture outside of the UK if they want to safely do business in Europe.

 

[Woosh]

As you have suggested, I agree it looks like these guys are cheating. There's not a great deal any of us can do about fraud except report it. I am sure that the same practices will exist even in a post Brexit UK. However I am referring to bona fide businesses that being forced to manufacture outside of the UK if they want to safely do business in Europe.

no, not after the transition period, even if we have a Norway+ deal.
Once the UK leaves the EU (after the transition), it leaves the common VAT area, if you sell a bike to a Frenchman, you can't charge VAT. Your Frenchman customer will pay French VAT.
That will be a level playing field.
These guys won't be much of a worry for me. The boot will be on the other foot!

 

[anotherkiwi]

KudosDave is the expert. I bet he must feel the same as I do.
The threshold for compulsory VAT registration is £85,000.
These guys don't have to charge VAT when their turnover is under the threshold.
They just keep their sales under the threshold or worse, don't even declare.
Nobody checks parcels going from Germany to UK. Invoices are sent by emails.
These operators don't have to have commercial premises, public and product liability insurance, no VAT registration.

91 000 €. You don't add VAT to the bill you send to your client BUT you pay VAT on everything you buy which means you are less competitive than a company which recovers VAT on everything they buy. 20% less competitive and that 20% comes out of your profit margin...

 

[Woosh]

91 000 €. You don't add VAT to the bill you send to your client BUT you pay VAT on everything you buy which means you are less competitive than a company which recovers VAT on everything they buy. 20% less competitive and that 20% comes out of your profit margin...

you've got it all wrong, AKW.

Let's take an example.
I pay $250 for a hypothetical kit + $10 delivery.
After delivery to my door, the kit costs me: 1.05*(250+10)1.20 USD ex VAT
The 1.05 is the import duty. The 1.20 is VAT.
Total: $328 or £262.08
If I want to sell on Ebay, I have to sell it at at least £399.
subtract the various cost centres:
Goods: -£262.08
ebay fees @ 10%: -£39.90
Paypal fee @ 2%: -£7.98
Post & packing: -£10
VAT:- £66.50
10% fixed running cost (premises, insurance, guarantee replacement,admin etc): -£39.90

Net sale proceed: £16.32

At that selling price, I cannot afford to spend more than 15 minute on support time before I start eating into my net profit before tax!

Now, let's see what happens if I don't charge VAT (ie when I sell to someone living in Jersey/Guernsey):

subtract the various cost centres:
Goods: -£262.08
ebay fees @ 10%: -£39.90
Paypal fee @ 2%: -£7.98
Post & packing: -£10
VAT:0
10% fixed running cost: -£39.90

Net sale proceed: £82.82

No comparison, is there?
The problem with the Chinese is some treat commercial invoices as something you find in a fortune cookie. They send you a Word document. You edit the details if you want to. If you don't want to pay import duty, then you just tell them to invoice you for a lesser amount.

 

[tommie]

Those are indeed miserable margins,

but you do claim your VAT back - yes?

 

[Deleted member 128]

you've got it all wrong, AKW.

Let's take an example.
I pay $250 for a hypothetical kit + $10 delivery.
After delivery to my door, the kit costs me: 1.05*(250+10)1.20 USD ex VAT
The 1.05 is the import duty. The 1.20 is VAT.
Total: $328 or £262.08
If I want to sell on Ebay, I have to sell it at at least £399.
subtract the various cost centres:
Goods: -£262.08
ebay fees @ 10%: -£39.90
Paypal fee @ 2%: -£7.98
Post & packing: -£10
VAT:- £66.50
10% fixed running cost (premises, insurance, guarantee replacement,admin etc): -£39.90

Net sale proceed: £16.32

At that selling price, I cannot afford to spend more than 15 minute on support time before I start eating into my net profit before tax!

Now, let's see what happens if I don't charge VAT (ie when I sell to someone living in Jersey/Guernsey):

subtract the various cost centres:
Goods: -£262.08
ebay fees @ 10%: -£39.90
Paypal fee @ 2%: -£7.98
Post & packing: -£10
VAT:0
10% fixed running cost: -£39.90

Net sale proceed: £82.82

No comparison, is there?
The problem with the Chinese is some treat commercial invoices as something you find in a fortune cookie. They send you a Word document. You edit the details if you want to. If you don't want to pay import duty, then you just tell them to invoice you for a lesser amount.

Interesting to see some example numbers Woosh. Aren't you able to reclaim the VAT that you paid when you imported the kit?
And on the topic of VAT, I bought a bike tool from the States recently and had to pay duty and a customs agent charge but no VAT, I wonder why not..
I know zilch about the workings of VAT, please excuse my ignorance.

 

[Woosh]

Those are indeed miserable margins,

but you do claim your VAT back - yes?

yes, I do. In this example above, £43.68.
my £43.68 goes to pay for pre-sale and after sale support cost.
The problem is some of my Chinese competitors don't even pay much on import duty, premises, admin cost and support cost.
They can afford to sell the same product for £349 and still beat me to the finish line at the end of the year.

 

[Woosh]

Interesting to see some example numbers Woosh. Aren't you able to reclaim the VAT that you paid when you imported the kit?
And on the topic of VAT, I bought a bike tool from the States recently and had to pay duty and a customs agent charge but no VAT, I wonder why not..
I know zilch about the workings of VAT, please excuse my ignorance.

the forum is full of posts telling you where to get the stuff without paying duty and VAT.
After brexit, stuff coming over from the EU27 will be treated similarly as coming from the USA. The number of cheats will be greatly reduced.

 

[Deleted member 128]

the forum is full of posts telling you where to get the stuff without paying duty and VAT.

I'm not looking to avoid paying duty and VAT, I'm puzzled why I wasn't charged VAT. If I, as a private individual, paid $250 for something from China would I be charged VAT?

 

[Woosh]

I'm not looking to avoid paying duty and VAT, I'm puzzled why I wasn't charged VAT. If I, as a private individual, paid $250 for something from China would I be charged VAT?

as I said before, they put $20 on the invoice.
You pay nothing to the postman.
Some do the same on a bigger scale. A container from China filled with instant noodles looks nortmal with $10,000 invoice. You can pack 1,000 BBSHD kits in less space - imagine you get invoiced for $20 each.

 

[Deleted member 128]

My Chinese competitors like PSWPower are setting up in Germany or Czechoslovakia.
They ship Chinese e-bikes and kits into the UK without charging VAT on Amazon, Ebay and online sales.
Brexit will eliminate this unfair competition because their customers will have to pay customs declaration and VAT.

What are companies like PSWPower doing that's illegal?

 

[Deleted member 128]

as I said before, they put $20 on the invoice.
You pay nothing to the postman.
Some do the same on a bigger scale. A container from China filled with instant noodles looks nortmal with $10,000 invoice. You can pack 1,000 BBSHD kits in less space - imagine you get invoiced for $20 each.

I guess UK customs thought it wasn't worth their while collecting VAT on the $40 tool from the USA, odd that did collect the duty though.