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Issue 08, 2008 (01 August)
 Industrial Policy

China Bans Excessive Packaging for Tea and Wine

Following the announcement of regulations against excessive packaging for mooncakes, new rules have now been issued to check "excessiveness" in the packaging of tea, cakes, wines, beverages and other food items. 

Mainland lawmakers are now seeking public comments on the draft of Restrictions on Excessive Packaging for Commodities: Requirements for Food and Cosmetics. Under the new national standards, the packaging cost of food and cosmetics may not exceed 12% of the selling price of the commodities. Also, beverages, wines, cakes and tea may not have more than three layers of packaging while grain may not have more than two layers. The enforcement of new national standards will have a considerable impact on the marketing of tea, cosmetics and wine, because "excessive packaging" is common for these three types of products. Enterprises relying on elaborate and deluxe packaging to make high profits may face elimination.

The cost of deluxe packaging is rising and so is its percentage in the price of products. Some ornate packaging accounts for over 50% of product price. Packaging cost will definitely be passed on to consumers. Following the implementation of the new standards, this situation is expected to improve and the number of enterprises relying on deluxe gift boxes and packaging to make big profits is bound to fall. The Mandatory Standards for Mooncakes announced in 2006 stipulated that packaging cost may not exceed 25% of the ex-factory price of products.

Excessive packaging not only means consumers have to shoulder unnecessarily high packaging cost but will make them feel cheated and give them the idea that they are "not getting their money's worth". Moreover, excessive packaging wastes a lot of paper and natural resources like timber, silk and metal.  China produces 200 million tonnes of household garbage each year, 40 million tonnes of which are packaging materials.