China restricts its law regarding e-commerce

On July 3, 2008 the Beijing Administration of Industry and Commerce has published an announcement with the draft of new rules for Internet commerce, which will come into force on August 1.

According to the new rules all "for-profit online stores" will be obliged to register for a license, as for the "individuals who sell or exchange items for personal use", they are not required to pass the registration. The only thing questions all the people: how to distinguish "for-profit" stores from the "not-for-profit" ones.

The official of in Beijing Administration of Industry and Commerce, Wang Jing, has given the following explanation:

"If the price is negotiated and accepted by both sides, it can be categorized as "not-for-profit"; if a buyer thinks that the seller intends to make a profit, and this is confirmed by the enforcement department, then the seller will be punished for doing business without a license."

The Beijing News has published an announcement where it reports that those who want to open a home-based "for-profit" online store should get a permission of their local neighborhood committee issued by it after consulting some nearby residents, such as neighbors.