CHINA. Today, 18 December, marked the beginning of a new phase for duty free in Hainan as an independent Hainan Free Trade Port customs regime took effect.
The move, approved and announced in July, sees some 6,600 types of goods (up from 1,900) allowed tariff-free into Hainan, covering 74% of all taxable imports. As we reported at the time, key to the offshore duty-free sector are the exceptions on the list – most key consumer commodities, including liquor and cosmetics, staples of the channel.
A China Duty Free Group (CDFG) statement said the move would “inject strong momentum into the travel retail sector” and help attract high-tech and modern service industries to Hainan.
The company added, “As a leader in China’s travel retail industry, CDFG is strategically positioned to leverage these policy opportunities, demonstrating its role as a state-owned enterprise by supporting the development of Hainan into an international tourism and consumption hub.”
To welcome the start of the new customs regime, CDFG held a special ceremony in the AURA atrium at cdf Haikou International Duty Free Shopping Complex. Hainan Provincial People’s Government Deputy Secretary-General Chen Wanxin and China Tourism Group Deputy General Manager Liu Kun were among those who attended.
CDFG also launched a promotional campaign to mark the milestone, which coincides with its Annual Shopping Gala. CDFG noted that the ceremony and themed campaign underlined how its duty-free stores “are poised to embrace the historic opportunities brought by the new customs regime”.
With brand partners, CDFG has launched a comprehensive ‘12-dimensional benefits system’ across its key stores, including cdf Haikou International Duty Free Shopping Complex, cdf Sanya Duty Free Shopping Complex, cdf Sanya Phoenix Airport Duty Free Store, cdf Haikou Mova Mall Duty Free Store, cdf Haikou Meilan Airport Duty Free Store, and cdf Qionghai Bo’ao Duty Free Store.
Featuring discounts, exclusive privileges, cultural-tourism experiences and interactive experiences, the campaign aims to translate the benefits of the new customs regime into tangible rewards for global consumers, CDFG said.
During the campaign, CDFG will distribute vouchers with a combined value of CNY121.8 million (US$17.3 million) across the island. Customers using designated payment methods can also enjoy an instant discount of CNY100 (US$14.20) for every CNY1,000 (US$142) spent.
Hainan residents with valid identification are eligible for an exclusive -12% discount on duty-free purchases at CDFG stores on the island. From 18 to 22 December, customers using Alipay’s Tap to Pay feature can win the chance to shop for free for up to CNY1,218 (US$173).
In addition, from 18 December to 4 January, a ‘low-price redemption’ offer covering fragrances & cosmetics, food and daily goods will be available simultaneously across all six Hainan stores.
Today, the launch day of the new customs regime, saw a series of special events and offers rolled out in CDFG’s flagship Sanya and Haikou stores.
At cdf Haikou, 12,180 duty-free cash vouchers were distributed during the launch ceremony, while 1,218 exclusive gifts were given to in-store customers on the day. A ‘Wizard of Oz’-themed parade, stand-up shows and a magic show ensured a vibrant atmosphere, while the Malt & More whisky museum offered 100 complimentary drinks in celebration.
At cdf Sanya, a drone light show lit up the sky, and European-style photo backdrops helped visitors capture memorable moments during their winter holiday.
The launch ceremony was live-streamed via CDFG’s official online channels, allowing global audiences to witness the festivities in real time. Meanwhile, CDFG’s airport and downtown locations in Hainan also collaborated with brands to introduce travel and dining benefits.
Advancing national strategy
Hainan’s new customs operations adopts what CDFG termed a ‘first-line opening, second-line regulation, and free flow within’ model, combining closed-loop management of goods with high-level trade liberalisation. This should ensure both security and efficiency while maximising the benefits of opening-up, said CDFG.
In support of the Hainan Free Trade Port, authorities upgraded the off-shore duty-free shopping policy from 1 November, adding new product categories and allowing select domestic goods to be sold in duty-free stores.
Building competitive edge
Addressing the changes, CDFG also said: “As a world-class travel retailer, CDFG has built a comprehensive strategic layout spanning channels, supply chains and membership operations to thrive in the era of the new customs regime.
“With over 200 duty-free stores across more than 100 cities in China and Cambodia, CDFG operates the widest retail network in the country, covering nine different store types, including airport, border, downtown and cruise ship outlets.
“In Hainan, its six stores form an island-wide duty-free ecosystem, led by the world’s two largest duty-free complexes – cdf Haikou International Duty Free Shopping Complex and cdf Sanya International Duty Free Shopping Complex. The latter, now a National AAAA Tourist Attraction, has surpassed CNY100 billion (US$14 billion) in cumulative sales since its opening.”
Supply chain strength is a key pillar of CDFG’s competitive advantage, noted the retailer’s statement. “Through years of deep focus on the duty-free sector, CDFG has established long-term, stable partnerships with around 1,600 globally renowned brands, earning a strong reputation among top-tier suppliers.
“With a rich brand portfolio and stable supply capabilities, the group operates eight customs-supervised logistics centres across Beijing, Shanghai, Dalian, Qingdao, Shenzhen, Sanya, Haikou and Hong Kong. Supported by an advanced monitoring system, these centres enhance logistics efficiency and enable fast, reliable nationwide product distribution.”
CDFG also said it has come closer to consumers, having “refined its membership programme and built a detailed, layered CRM system. By consistently driving traffic from offline to online channels, the group has increased both user conversion rates and member repurchase rates year-on-year”.
In the first half of 2025, CDFG’s membership base exceeded 45 million, it added.
A global hub for premium consumption
As Hainan launches the new customs regime, demand for diverse and exclusive offerings is bound to rise, said CDFG. The company said it plans to meet this need with hundreds of thousands of products, evolving from a product provider to a “unique consumption ecosystem”.
Through deepened collaborations with top global brands, CDFG said it will continue enhancing its offerings with exclusive launches, limited editions and co-branded products. This year, the fifth cdf Watch Carnival featured over 7,000 selected timepieces from more than 50 brands, including over 30 exclusive to CDFG.
Meanwhile, first-to-market stores remain a key growth driver, said CDFG, citing Coach’s first two-storey travel retail flagship in China, Estée Lauder’s first global two-storey flagship and Lancôme’s Domaine de la Rose concept store (below), which all made their debuts at cdf Sanya.
Other recent developments include the largest Dior Beauty flagship worldwide, Moncler’s first two-storey outlet in Hainan featuring its latest concept, and the newest concept store from Monologue, a Chow Tai Fook-owned jewellery brand.
In addition, international and domestic brands including Longines, Lao Miao Jewellery, Martell and Armani have introduced over 70 CDFG-exclusive products, while more than 30 brands have launched limited-time experiential activations with the retailer.
China’s first immersive whisky museum, Malt & More, and Leica’s Haikou flagship debut, among other key openings, have also “elevated the retail experience at cdf Haikou, continuously enhancing the brand appeal of Hainan’s duty-free market”, CDFG noted.
In line with new duty-free policies, CDFG said it has expanded into categories such as small appliances, mini drones and domestic fashion, supporting Chinese brands going global. It has also tapped into the silver economy with senior-friendly products and services, launching its own wellness brand CDF Health to meet growing demand for high-quality health products.
Elevating experiences
In response to demand for immersive experiences, CDFG said it was transforming its stores into “cultural, leisure and social destinations, driving a dual upgrade in both functionality and experiential appeal”.
The company built its year-end campaign, the Annual Shopping Gala, on the three pillars of immersive content, interactive marketing and strategic partnerships, delivering over 100 parades, themed shows and entertainment collaborations to keep shoppers engaged.
During the event, CDFG Hainan stores become “lively party destinations”, with cdf Sanya hosting colourful clown parades and modern dance parties, while cdf Haikou has been offering themed events and pop-up shows celebrating traditional Chinese fashion.
cdf Haikou Mova Mall store has also rolled out its own membership programme, allowing points redemption for rewards and enhancing retail-tainment.
cdf Haikou’s Malt & More whisky museum meanwhile has become a showcase for the history and culture of whisky while providing interactive experiences, and has welcomed over 4.9 million global visitors since its opening.
Improving service
Meanwhile, the group said it continues to enhance consumer experiences through improved services and technological innovation. cdf Sanya has developed eight major service support systems and 98 new service standards. It also offers customised services for premium members, creating exclusive member events in Hainan through “targeted online invitations and tailored offline services”.
cdf Haikou has implemented a comprehensive service mechanism covering pre-sales, in-sales and post-sales, achieving a 30-second rapid response, 15-minute follow-up and efficient after support, boosting customer satisfaction, according to CDFG.
To reduce passenger pick-up time, it pioneered low-altitude logistics innovation by launching a drone transport route to Haikou South Port, enabling seamless transfer of duty-free goods from warehouse to port.
Also, cdf Haikou Meilan Airport Duty Free Store has worked to improve the experience for passengers affected by flight delays and elderly visitors, providing services such as shopping subsidies, priority lanes and complimentary ironing.
Hainan becomes an international tourism hub
Facing the “historic opportunity” presented by the new customs regime, CDFG said it is positioned to “pioneer a new chapter in the high-quality development of China travel retail”.
The group has achieved breakthroughs in brand portfolio building, consumer experience enhancement and global supply chain integration, setting “new industry benchmarks for both innovation and efficiency”, it claimed.
Looking ahead, the group said it will continue to leverage its ‘duty-free+’ model to actively promote the integration of culture, commerce, sports, tourism and wellness activities.
The statement concluded, “Through ongoing product innovation, experience redesign and service upgrades, CDFG is committed not only to building a global hub for premium consumption but also to fulfilling its responsibilities as a state-owned enterprise.
“By contributing comprehensively to Hainan’s development as an international tourism and consumption centre, the group is committed to playing a pivotal role in advancing China’s travel retail industry and shaping the future of global travel retail.” ✈
