In 2018, Russian Post handled more than 300 million imported international parcels, an increase of more than 10 times in 5 years, of which imports from China accounted for more than 90%. Cross-border land transportation between China and Russia is very convenient. Russia basically checks express delivery methods such as DHL and FedEx. Russian express delivery generally requires the recipient to be a company name, and the company has the ability to clear customs. EMS is basically used for delivery with low timeliness. The Russian population is concentrated around the official seat of the administrative district. The arrival time of local express delivery in first-tier cities is about one week, and the arrival time of express delivery in second-tier cities is about half a month. In general, Russia is vast and sparsely populated, spanning 10 time zones, and the volume of e-commerce orders is very scattered, and the logistics costs remain high. Russian Post (abbreviated as Russian Post), DPD, SPSR, PONY, SDEK, etc. are the main distributors. Russian Post accounts for 70% of the entire market, and DPD accounts for 25% after acquiring SPSR.
Direct mail parcels are the most commonly used logistics method for Russian Post. In recent years, it has benefited greatly from this and has stepped up its development. It has launched innovative measures praised by the industry, such as direct docking with the platform, simple tracking products, cross-border charter flights, and electronic customs clearance. In 2019, Russian Post directly established a subsidiary in Shenzhen. Russian Post has five major postal ports, including Moscow, St. Petersburg, Yekaterinburg, Novosibirsk and Kazan, to receive cross-border parcels. However, due to the “long-term disrepair” of delivery personnel, network facilities and operating procedures, the processing capacity is seriously insufficient, and there will be “must be congested” during the peak season when there are many goods. Customers in remote areas will lower their requirements for delivery time. Russian Post has a self-pickup service, but the storage time is limited, and a storage fee will be charged if it is overdue. There is also a small demand for cash on delivery in this market.
Russian Customs has strict restrictions on the value of small packages, and often adjusts the duty-free import amount, and the difficulty of customs clearance is also increasing. The latest regulations are that consumers can receive a total of foreign parcels with a value of less than 1,000 euros and a weight of less than 31kg per month. If the parcel exceeds this limit, customs duties will be incurred, and the tax shall be borne by the buyer; if there are more than 5 identical goods in the same parcel, the customs will regard it as non-self-use items and refuse customs clearance and return it. Personal commercial customs clearance requires personal information such as tax number. At present, many online logistics sent to Russia have begun to use personal commercial customs clearance. When placing an order, the platform will require sellers to fill in relevant personal information. Sellers must communicate with buyers in advance to cooperate with each other in customs clearance and sign customs clearance authorization agreements online. Customs clearance failures are mostly caused by incomplete declaration materials.
Russia’s tax revenue mainly comes from local “permanent establishments”, which can be representative offices, branches and legal entities. The tax law lists three levels of taxation: federal, regional and local taxes. Overseas warehouse goods entering Russia must be handled as general trade, with tariffs and value-added tax. If the goods exceed 1kg, it is advantageous to use overseas warehouses, which can radiate the CIS market of the surrounding customs union. If overseas companies want to directly participate in the business related to Russian logistics infrastructure, they must find a local Russian partner. When using Russian overseas warehouses, the contract is signed by a domestic logistics company, but the actual operation may be done by a Russian company.