Trade Customs Research Articles

Green credit and firms’ span of global production stages

This paper investigates the impact of the green credit policy on firms' span of global production stages. We leverage a comprehensive dataset, including customs trade data, industrial firm data, and Chinese Input-Output tables, and employ a difference-in-differences design that accounts for the pollution spillover effect within the production network. Our findings indicate that firms in pollution-intensive industries tend to move downstream in the global production line, accompanied by an expansion in the span of production stages. We present evidence that the broader range of production stages can be attributed to increased firm productivity. The effect is more pronounced for hybrid processing firms, private firms, foreign firms, and those in industries that rely on external finance dependence. Our study provides valuable insights into the impact of green credit policies and sheds light on firms' strategies in the context of green development.

The impact of digital transformation on enterprise export resilience: Evidence from China

External shocks have negatively affected trade activities around the world, how to improve the enterprise's anti-risk ability to external shocks has gained widespread attention. This study explores whether and how the digital transformation affects enterprise export resilience after the 2008 financial crisis. By expanding an export growth model and utilizing a merged dataset from the Chinese customs trade and A-share listed company database, we find that digital transformation significantly enhances export resilience, and this effect is more prominent in private enterprise as well as high-tech enterprise types. The mechanism analysis shows that digital transformation promotes enterprise export resilience through cost reduction and demand diversification channels. In addition, the effect of digital transformation is more evident on enterprises exporting to high-income countries. Furthermore, this paper finds that the smart city pilot policy has strengthened the promoting effect of digital transformation on enterprise export resilience. These findings shed insights into the relationship between the digital transformation and enterprise's export behavior in the post-crisis era.

The Unidroit Principles on International Commercial Contracts and sustainable development

Abstract A number of motivations currently drive multinational corporations to the inclusion, monitoring, and enforcement of contract requirements for sustainability. These can be either as a result of investor demand for environment, social, and governance policies; regulatory requirements for inclusion of such contract stipulations; or the increasing litigation for conduct leading to environmental harm, but they can also be a result of reputational risk linked to the failure of adoption of such policies. This article examines the role of contract law in enforcing such requirements, which have traditionally been viewed with suspicion due to their unilateral nature. The article poses the features of the International Institute for the Unification of Private Law’s Principles on International Commercial Contracts as a beneficial regime to further the goals of sustainability through the use of contextual interpretation enabled through the good faith principle, the recognition of the importance of trade usages, and the limitations placed on party autonomy. The article posits that a major shift in the ideological orientation of contract law through the imposition of limitations on the pacta sunt servanda principle in order to protect the public interest is not warranted. Rather, tools such as contractual interpretation and the establishment of contractual standards of sustainability are better placed to ensure enforcement and compliance with the widely established practice of inclusion of sustainability standards and codes of conduct.

Custom as a Source of Russian Civil Law

In this paper, the author explores the historical significance and complexity of legal customs in the formation of legal systems. The paper analyzes the evolution of a custom from the primary sources of law in ancient societies to its modern status, where their role, although important, is subject to certain limitations, is analyzed.The paper highlights the understanding and application of the term «custom» in the context of modern civil legislation of the Russian Federation with an emphasis on the changes that occurred after the legislative reform of 2012. The study examines various fields of application of customs. Special attention is paid to the analysis of the role and place of international trade custom in civil law relations in the Russian Federation. Based on the opinions of experts and considering in detail the judicial practice of the International Commercial Arbitration Court at the Chamber of Commerce and Industry of the Russian Federation, the author concludes that international trade custom is a source of law, and it also falls under the concept of «custom» within the framework of Article 5 of the Civil Code of the Russian Federation. The study emphasizes the oral nature of a custom as a source of law, while not neglecting the importance of informal written forms such as Incoterms and UNIDROIT, as well as standard contracts Special attention is paid to the debatable topic of the relationship of customs with imperative and dispositive norms of legislation, as well as their place in the structure of the Civil Code of the Russian Federation. The author highlights the problem of insufficient legislative regulation of customs and calls for their further research and systematization as a critically important element of the legal system.

Study on the Development of Offshore RMB Market and Its Impact on the International Financial System

The internationalization of the Chinese yuan responds to challenges with the US dollar's dominance, spurred by events like the subprime crisis and unlimited quantitative easing. China's economic stature necessitates yuan's global role. Its journey involves five stages, from border trade usage to SDR inclusion and presence in global indices. Offshore markets are pivotal, facilitating capital flows and meeting investor needs. Financial regulatory reforms align with market dynamics, enhancing transparency and stability. This study explores the symbiotic relationship between yuan internationalization and financial regulatory reforms, offering theoretical insights and policy recommendations for China's financial evolution and yuan's global ascent.

Digital product import and domestic value-added ratio of export: Theory and demonstration

Based on the matching of the database of China Industry Business Performance and China Customs Trade from 2000 to 2013, this paper constructs the digital product import index, and adopts the method of panel data modeling to systematically investigate the impact and mechanism of digital product import on the domestic value-added rate of Chinese enterprises' export from the theoretical and empirical aspects. The research finds that the import of digital products significantly promotes the improvement of the domestic value-added rate of enterprises' export, and the core conclusion is still valid after considering the endogeneity of variables, changing the measurement index and estimation method. The mechanism test finds that the import of digital products improves the domestic value-added rate of enterprises' export through two channels: cost markup and relative price. In addition, the heterogeneity test finds that the import of digital products has a stronger effect on the improvement of the domestic value-added rate of enterprises' export in non-export enterprises, pure general trading enterprises, foreign-funded enterprises, labor-intensive enterprises and enterprises in the eastern region.

Has Artificial Intelligence Promoted Manufacturing Servitization: Evidence from Chinese Enterprises

Artificial intelligence, as a novel form of infrastructure with both generality and knowledge spillover characteristics, plays a crucial role in facilitating the profound integration of the manufacturing and service industries, and achieving economic transformation. This paper empirically investigates the impacts of artificial intelligence on the process of manufacturing servitization, utilizing merged data from the OECD-ICIOT (Organization for Economic Co-operation and Development, Intercountry Input-Output Tables) industry data, the Chinese industrial enterprise database, and the customs trade database. The empirical findings of this research demonstrate that artificial intelligence has significant and positive effects on manufacturing servitization. These positive effects primarily occur through two channels: enhancing total factor productivity and optimizing the labor skill structure. Furthermore, this study examines the variations in the impact of artificial intelligence on the transformation of embedded services and blended services. The analysis reveals that artificial intelligence significantly promotes the transformation of embedded services, while its impact on the transformation of blended services is comparatively less pronounced.

Strengthening operational creditor rights and trade credit: Evidence from creditor reforms

Trade creditors are exposed to credit risk when they extend credit to their clients during the sale of goods. The present study exploits a regulatory intervention that enhances the rights of trade creditors in cases of default. By leveraging the implementation of the Insolvency and Bankruptcy Code (IBC) in 2016 as a policy intervention, we employ the difference-in-differences (DID) approach to demonstrate that the strengthening of trade creditor rights leads to a rise in the usage of trade credit to financially vulnerable firms. Additionally, our study indicates that financially vulnerable firms experiencing information asymmetry exhibit a more pronounced increase in trade credit. Overall, the paper shows that strong legal protections for trade creditors are essential to trade credit.

Trade effects of transnational timber legality assurance regimes: Evidence from the lacey act amendment on China’s forest product exports

We analyzed the trade effects of transnational timber legality assurance regimes, specifically the impact of the Lacey Act Amendment (LAA), on forest product exports from China to the U.S. The LAA is a strict legal requirement for forest product sources. It was implemented phase-by-phase, beginning in 2008 in the U.S. We applied a staggered difference-in-differences model and a unique and disaggregated dataset from the Chinese Customs Trade Database at the firm–product level from 2000 to 2016. We found that the implementation of the LAA decreased the probability of exporting Chinese forest products to the U.S. by 2.36%, but contributed to an increase of 10.20% in export value. The overall trade effect was positive, owing to an increase in the intensive trade margin (i.e., how much was traded). The LAA exerted lasting but varying effects during different phases of its implementation. In the initial stage, both the extensive and intensive margins decreased significantly. In the second stage, exporters tended to comply with the legal requirements, reducing the negative impact of the LAA. As time went on, the intensive margin became positive. A heterogeneous analysis showed that the negative impact of the LAA was more pronounced for small-scale, single-product, and non-foreign-invested exporters. We discuss the implications of these findings.

How does bank competition affect trade-mode transformation? Evidence from Chinese export enterprises

This study investigates the effect of banking competition on the transformation of Chinese firms' export trade mode. We use matched data from the Chinese Industrial Enterprise Database and the Chinese Customs Trade Statistics between 2007 and 2013 to measure export firm trade-mode, and apply the number of commercial bank branches at the prefecture level to gauge bank competitiveness. With a large firm-level dataset, we find that bank competition affects a company's transition from processing mode to ordinary trade. The validity of our findings is confirmed through several robustness tests. Furthermore, we examine the underlying processes through which bank competition influences trade-mode transformation by means of firms' financial constraints, the regional marketization process and banking structural characteristics. Finally, we investigate the heterogeneity conditions and find that firms with distinct ownership structures and in different geographical locations demonstrate diverse performances in the aforementioned connection. The empirical findings provide crucial evidence to enhance the understanding of the relationship between banking institutions and company exports in emerging economies.

Do cleaner production standards upgrade the global value chain position of manufacturing enterprises? Empirical evidence from China

The harmonious development of trade and environment is extremely crucial for developing countries that face challenges posed by extensive economic models and environmental pollution as they strive to engage more deeply in the global economy. This article utilizes micro-level data from the Chinese Industrial Enterprises Database (CIED) and the Chinese Customs Trade Database (CCTD) from 2000 to 2012. It takes China's implementation of cleaner production standards (CPS) since 2003 as a quasi-natural experiment and applies staggered DID to investigate the impact and mechanisms of exogenous shocks from environmental policies on upgrading and transformation of enterprise value chains. The aim is to provide comprehensive empirical evidence regarding the availability of environmental regulations and the GVC position of Chinese enterprises. Thus, we also offer valuable insights for similar developing countries seeking a path toward high-quality advancement. The research findings are as follows. First, CPS exerts a significant upgrading effect on enterprise value chains, and this conclusion is highly robust. Second, heterogeneity analysis reveals that the upgrading effect of CPS on value chains is predominantly influenced by factors including the enterprise's asset scale, ownership structure, geographical location, trade pattern, as well as the technological level and pollution intensity within its specific industry. Third, further tests through mechanism analysis reveal that CPS expedited the integration of Chinese manufacturing enterprises in GVC by promoting innovation and R&D capabilities, enhancing total factor productivity, and improving labor wages.

Principle of Choice of Customs Procedure in EU Customs Traffic

The research topic of the article focuses on the analysis of the principle of choosing a customs procedure in EU customs trade, which is of a normative nature. It is also the basic method of dealing with goods. In addition to the general legal principles constituting this principle, the article discusses the principle of freedom of trade in goods abroad; the principle of equal treatment of entities; the principle of equal treatment of goods; the principle of universality of customs duties and customs fees; the principle of universal access to information on customs law; the principle of non-revokability of the customs declaration. The conditions for export and import customs procedures were also discussed.

Rzymska czy grecka? O pochodzeniu zasady rodyjskiej o zrzucie morskim - lex Rhodia de iactu

What where the origins of the Rhodian law of jettison? Did the Romans really adopt the law created on the Greek island? The first part of the article examines the origin and authenticity of available sources. The second part deals with the origin of the idea to regulate this issue. Consequently, it appears that lex Rhodia de iactu was a maritime trade custom that developed in the Greek cultural background. When the Romans started to participate in the Mediterranean maritime trade, they adopted and transformed the custom in such a way that it became compatible to Roman law. This is how the Greek idea of settling a loss, incurred in the common interest, became one of the contractual elements of locatio conductio. It proves the usefulness and flexibility of that contract as well as the reasonableness of Roman law, which was able to accept good solutions from laws of other nations.

Structure and principles of international commercial contracts

The presented article describes in detail the main conditions, content, obligations of the seller and the buyer, according to the concluded international commercial contracts. International commercial agreements mediate the international business activities of the parties and differ from similar internal transactions, as well as transactions that, although complicated by a foreign element, are concluded with the participation of the consumer. The first stage refers to the period of the emergence of medieval law as a law merchant, representing a set of international trade customs that regulated the political community of merchants who traveled from port to port and from fair to fair. The second stage was marked by the emergence of national legal systems under the influence of the understanding of law as a national phenomenon and the approval of the idea of national sovereignty. The modern third stage, was marked by a movement from national isolation to universal unification, which allowed, on the basis of multilateral negotiations, to develop and adopt uniform legal norms.

Major-customer geographic proximity and supplier trade credit: empirical evidence from China

ABSTRACT Customer geographical proximity is a factor influencing supplier firms’ trade-offs when granting customers trade credits. However, the extant literature offers scant empirical evidence on the effect of customer location on supplier firm’s trade credit. This paper investigates the impact of major customers’ geographical proximity on a supplier firm’s trade credit. Using a sample of 5,587 observations of publicly listed Chinese firms between 2007 and 2017, we document a positive relationship between major customers’ geographical distance and the supplier firm’s trade credit. Moreover, the main results remain robust when changing samples and considering endogeneity problems. This paper also tests two potential channels and identifies the exploring market channel that exists in our sample. Furthermore, the main relation is more pronounced in supplier firms with low financial risk, operating in areas of high marketization, high product development, strong legal environments, and low economic policy uncertainty. This paper extends the existing literature on the economic consequences of customer characteristics on supplier firms to include customer geographic proximity. In addition, this paper sheds light on supply chain risk management.

Elephant in the Room: CISG, Hardship, and Uniform Application

It has long been disputed by scholars, courts, and arbitral tribunals whether or not hardship is covered by Article 79 of the CISG. In 2020, the CISG Advisory Council published an opinion and expressed the view that CISG governs cases of hardship but under Article 79, the parties have no duty to renegotiate the contract; and a court or arbitral tribunal may not adapt the contract or bring the contract to an end. Council’s opinion is primarily based on the aim to prevent recourse to domestic law. In fact, if one accepts that CISG contains a gap concerning hardship, domestic law will apply to fill such gap, and this would undermine the unification of the law. However, this can hardly be a reason to accept that cases of hardship are covered by Article 79 CISG. Historical, textual, and teleological interpretation of Article 79 as well as an economic analysis of the concerned remedies show that Article 79 does not cover and/or is not suited to apply to cases of hardship. Therefore, there is an internal gap within the CISG concerning hardship and except for some exceptional cases, where one could find an international trade usage between the parties, the last resort to fill such gap is resorting to the domestic law applicable through private international law. Hardship, adaptation, renegotiation, CISG, external gap, internal gap, pacta sunt servanda, clausula rebus sic stantibus, observance of good-faith in international trade, international trade usage

Do information spillovers across products aggravate product market monopoly? An examination with Chinese data

The simultaneous presence of accelerating information flows and declining market dynamics has sparked widespread interest. However, existing literature does not fully recognize the causal link between them. Using the China Customs Trade database (2000–2013), this paper studies the impact of information spillovers across products on the intensifying monopoly in China's export product market. It finds that with the strengthening of inter-product information spillovers, big firms' market share and market survival rate increase significantly. Big firms' monopoly power is strengthened because inter-product information spillovers drive them to innovate more strategically and allow them to raise market barriers to entry. However, the aggravated monopoly can only increase the export scale but not improve the product quality, which is unfavorable to long-term economic growth. Finally, a comparison of spillover impacts under different policy interventions reveals that the monopoly risk can be aggravated by the industrial policy but mitigated by the regional policy.

Lex Mercatoria as Substantive Applicable Law of International Sale and Purchase Contracts

This study aims to analyze lex mercatoria as a substantive applicable law international sale and purchase contract. The research method used is a qualitative method. The research results show that international trade activities often lead to disputes between the parties. And the choice of dispute settlement can be made either in court or in arbitration. There are two types of law that apply and are used in international arbitration, namely arbitration procedure law and arbitration substantive law. The substantive law is in the form of a country's national law and/or international conventions related to contracts and lex mercatoria. Lex mercatoria is the law of traders derived from trade usages and general principles of law. CISG can be classified as one of the lex mercatoria because there are principles that generally govern sales and purchase contracts which are referred to as the general principles of international contract law so that the general law principles in this contract are applied as substantive law by arbitrator judges in deciding contract disputes, international sale and purchase in international arbitration.

How does the belt and road initiative promote China's import?

AbstractWe estimate the policy effect of belt and road initiative (BRI) on China's import. We use highly detailed, product‐country level data from China Customs Trade Statistics Database which covers 5364 types of products and 201 economies from 2010 to 2017 to investigate the policy effects and the underlying mechanisms. We find that the BRI has significantly boosted China's imports from countries along the route. The BRI have significant expansion effect on imports of existing products as well as positive effects on imports of new product import and product exit, which means BRI may also contribute to the optimization of product structure and growth in value of China's imports. Moreover, BRI have positive effects on both general trade and processing trade. Mechanism analysis shows that policy coordination, cultural affinity, and maritime transportation connectivity have strong explanatory power on the policy effects of BRI. We also find that the BRI has played a "boosting" role for import boost for new RTA partner as well as non‐RTA members along the route. We further examine the impact of BRI on global bilateral trade, and the result shows that BRI has generally promoted bilateral trade among all countries along the route, not limited to origin‐China pairs.

A Review of Incomplete Agreements and the Formation of a Sales of Goods Contract

Purpose - This paper focuses on two issues that may arise from incomplete agreements in relation to the formation of contracts in international sales transactions, and explores national attitudes toward these issues. The first issue is whether a contract can be formed for an incomplete agreement. The second issue is the question of what criteria can be used to determine terms not agreed upon between the parties.
 Design/Methodology/Approach - This paper analyzes each country’s attitude toward incomplete agreement through case analysis. It explores the international trend towards incomplete agreements through analysis of the case of the UK and the cases of CISG member countries.
 Findings - Our findings may be summarized as follows. Even if an incomplete agreement is achieved, the courts tend to interpret it to allow the formation of a contract if the parties’ intentions to be bound by the agreement are clear. Whether or not a contract is formed depends on what terms the parties need to agree to in order to make the contract binding. If there is no agreement between the parties regarding the open terms, these are determined by applying objective criteria that consider the transaction process, trade usage, and purpose of the contract.
 Research Implications - This research is significant in that it analyzes the trends in the interpretation of incomplete agreements. This thesis found where it was clear that the parties intended to be bound, and to establish a legal relationship, it is permissible to imply terms that give business validity.