How to Set Up e-Commerce In China
Like most of its online activity, China regulates its e-commerce environment more strictly than in the rest of the world. Most of these efforts are to help prevent fraud and money-laundering. Just keep in mind that you cannot simply set up a website and start to sell goods.
Licensing for e-commerce in China
If you want to do e-commerce in the Chinese marketplace, there are two Internet Content Provider (ICP) licenses you need to acquire first:
ICP Beian (ICP备案) – This is the standard ICP license required to host a website in China.
ICP Commercial – This ICP license gives its holder the legal ability to accept payments online, but it generally applies to online stores that sell services or physical goods.
Under the spirit of the law, this would include both websites with online shopping carts and also people who are selling through stores in online marketplaces such as Taobao, JD.com, or Alibaba. In practice, most online marketplaces in e-commerce have not required its users to prove they have a commercial ICP to open and operate a store.
However, recently this year, JD.com – one of China’ biggest e-commerce marketplaces, often referred to as “The Amazon.com of the East” – announced that they would begin requiring their merchants to submit their commercial ICP licenses. This would apply to accounts owned by both foreign and domestic accounts. It is unclear how and when they begin to enforce this rule, but it demonstrates that companies are becoming more serious about enforcing stricter compliance with the law.
Websites that do not have an ICP record cannot be accessed in Mainland China. You can see the ICP license numbers for any Chinese website at the bottom of the front webpage, where they are required to be displayed:
I need an ICP license for China. How can I get one?
Your website does not need to go live prior to applying for the license, but you will need to first obtain a local hosting provider, to whom you will submit the at around 10 or more different pieces of required documentation, which can vary from province to province.
Assuming all documentation is in order, it takes an average of 20 business days to receive an ICP license.
However, it is important to understand that foreign companies are not eligible to receive either ICP license. For this reason, foreign entities usually partner with Chinese internet companies to use the licenses of the Chinese company.
This is where AppInChina can help. We can apply for these licenses on behalf of our clients. Your company will simply sign a partnership agreement with us and we will help run your e-commerce platform for you.
When you sign up for AppInChina’s services, you always retain the right to your own content and complete control of your own operations, while at the same time taking advantage of our company status and many years of expertise in the Chinese market.
How Can I Host My Online Store in China?
In addition to the ICP licenses, AppInChina will also assist you with:
Creating a Chinese domain name. This will be required to apply for the various licenses, and must undergo real name verification of the owner. Chinese domain names end in .cn. You can choose a name that is similar to your own current domain, such as mystore.com.cn, or mystore.cn.
Hosting your site in China. All hosts will require your ICP license numbers before releasing server credentials to you. Chinese law states that data acquired in China must stay within its borders. This would naturally include email addresses, physical addresses, passwords, preferences, and other personal data that are necessary to operate an e-commerce site. So your site and databases must be hosted on servers that physically reside in China. Moving the data across borders for any reason requires your company to apply for specific permission to do so.
Additionally, because outside traffic must pass through The Great Firewall before making it to a device in China, locally-hosted sites almost always load more quickly and operate more efficiently, providing for a much better experience for your users.
The AppInChina Advantage
AppInChina has a full China-side hosting solution to make it easy and affordable for your company to open an e-commerce website while remaining legally compliant and providing the best experience possible for your customers. In addition to launching your e-commerce solution, our services include marketing, user acquisition, payments integration for China, and customer service. Send us a message to get more information.