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What types of small, medium and micro export enterprises are eligible for the 1039 Market Procurement Trade Export Procedure?
or complex compliance issues.
clearance and fund security.
I am an operator of a small, medium and micro foreign trade enterprise dealing in daily necessities in Shanghai, and I have been in this industry for nearly 3 years. I have been extremely anxious recently! Last week, a shipment of LCL bulk cargo bound for Southeast Asia was detained at the port for 3 days due to incomplete documents under general trade, and I paid the customer 8,000 RMB as liquidated damages.
My usual orders are all multi-variety and small-batch, with the value of each shipment mostly below 100,000 US dollars. My customers are all small wholesalers in Southeast Asia, and the goods they order each time are very miscellaneous, including cups, towels and storage boxes shipped in mixed loads. Previously, when using general trade, tax refund was often held up due to incomplete input invoices, and I was also subject to two tax correspondence audits.
I heard from peers that the 1039 Market Procurement Trade procedure can solve these problems, but I don't know if it is applicable to my situation. For example, my goods are of miscellaneous categories, my customers are small wholesalers, and I ship via LCL at Shanghai Port, can I use the 1039 procedure? Also, will there be any compliance risks?
Jason WuYears of service：10Customer Rating：5.0
International Logistics & Supply Chain ManagerStart a Chat
First of all，the core access threshold for 1039 Market Procurement Trade shall be clarified: the value of goods per customs declaration shall not exceed 150,000 US dollars，and the goods shall be consolidated and filed in a recognized market procurement trade cluster. In the pre-document review stage，it is necessary to verify in advance whether the goods fall into prohibited or restricted export categories，and confirm that the enterprise has completed the filing of market procurement business entities in the cluster. Individual industrial and commercial households or small，medium and micro enterprises are all eligible to apply.
For core node connection: after cargo consolidation is completed，the filed cargo consolidator shall declare to the customs. When declaring，the customs declaration form for market procurement trade export goods shall be submitted，and foreign exchange receipt filing shall be completed simultaneously. Cross-border RMB receipt and payment is supported，and no matching of input invoices is required. Abnormal contingency plans shall be formulated in advance: if the customs questions the customs valuation，the market procurement price certificate issued by the cluster can be provided，if the goods category is inconsistent with the filing information，the filing information shall be supplemented and modified within 24 hours to avoid port detention.
For final compliant implementation，it shall be ensured that foreign exchange receipt is completed within 90 days after customs declaration，and all documents (filing form，customs declaration form，foreign exchange receipt voucher) shall be retained for more than 3 years. It is strictly prohibited to mix prohibited export goods into 1039 customs declaration，otherwise administrative penalties from the customs will be imposed.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
The 1039 Market Procurement Trade export procedure is applicable to multi-variety, small-batch LCL bulk cargo scenarios, especially for export goods with a per-shipment value of less than 150,000 US dollars and for which complete input invoices cannot be provided. Attention shall be paid in the customs declaration stage: the goods shall complete consolidation and filing in the designated market procurement cluster, the customs declaration form shall be marked with "Market Procurement", and the declaration entity shall be the filed cargo consolidator or foreign trade agency enterprise.
If the mark is not added as required, the declaration will be judged as general trade declaration by the customs, which will cause valuation disputes or return of declaration forms, and even lead to port detention. In addition, 1039 customs declaration does not accept applications for amendment and re-declaration more than 2 times, so the consistency of goods category, quantity and filing information shall be checked in advance to avoid unnecessary losses.
Eric ZhouYears of service：6Customer Rating：5.0
Senior Manager of Foreign Exchange & Tax RebatesStart a Chat
The 1039 Market Procurement Trade export procedure is applicable to various transport modes such as sea freight LCL, air express and land transport shuttle buses, especially for scattered goods sent to emerging markets such as Southeast Asia and the Middle East. Attention shall be paid to logistics node connection: after cargo consolidation is completed, customs declaration shall be arranged within 48 hours to avoid additional detention charges for goods in the yard. In terms of cargo right control, the title of the bill of lading shall be consistent with the filed cargo consolidator.
If the bill of lading needs to be transferred, the cargo right transfer filing form shall be submitted to the customs in advance, otherwise overseas pickup cannot be completed. In addition, in case of overbooking and container rolling, it is necessary to apply to the cluster for changing the customs declaration port in time. 1039 supports cross-port declaration, but customs transfer formalities shall be handled at the original filing port to ensure smooth shipment of goods.
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
The 1039 Market Procurement Trade export procedure is applicable to small, medium and micro foreign trade enterprises that cannot obtain VAT input invoices, as well as export goods that are ticket-free goods purchased in the market cluster. In terms of tax compliance, 1039 implements the VAT exemption policy, and no export tax refund is required, thus avoiding the risk of tax correspondence audit caused by incomplete input invoices in general trade.
In addition, enterprises can enjoy preferential exchange rates for cross-border RMB receipt and payment through the 1039 procedure, without bearing US dollar exchange losses. It should be noted that if an enterprise carries out both general trade and 1039 business at the same time, the accounts of the two types of business shall be completely separated, and mixed accounting is strictly prohibited. Otherwise, it will be judged as tax evasion by the tax authority, and face fines or suspension of business for rectification.
Lucas LiuYears of service：8Customer Rating：5.0
Senior Operations ConsultantStart a Chat
The 1039 Market Procurement Trade export procedure is applicable to overseas small-amount procurement customers, especially individual wholesalers and small retailers in Southeast Asia, Africa and other regions. In the foreign exchange receipt and payment link, 1039 supports cross-border RMB receipt and payment through the CIPS system, no need to open an offshore account, and the foreign exchange receipt amount can have a ±5% error with the value on the customs declaration form, which meets the demand for small and scattered foreign exchange payment. It should be noted that foreign exchange receipt shall be completed within 90 days after customs declaration.
If the foreign exchange is not received after the deadline, an application for delayed foreign exchange receipt filing shall be submitted to the State Administration of Foreign Exchange, otherwise it will be included in the foreign exchange abnormal list, affecting subsequent export business. In addition, it is strictly prohibited to receive foreign exchange through third-party personal accounts, and the corporate account filed by the enterprise or the account of individual industrial and commercial households shall be used for foreign exchange receipt.
Cindy ChenYears of service：3Customer Rating：5.0
Key Account ManagerStart a Chat
The 1039 Market Procurement Trade export procedure is applicable to overseas customers using simple procurement contracts, especially for small-amount transactions that do not require letter of credit settlement. In terms of legal compliance, the contract for 1039 business only needs to clarify the goods category, quantity, price and delivery time, without complicated clause agreements, which reduces the cost of contract drafting and review.
It should be noted that if an overseas customer requests the transfer of cargo rights, the time and conditions for the transfer of cargo rights shall be clearly agreed in the contract, and relevant supporting documents shall be submitted to the customs to avoid cargo right disputes. In addition, if the delivery of goods is delayed due to force majeure, you can apply for exemption from liability in accordance with the relevant provisions of the market procurement trade cluster to reduce the loss of liquidated damages.
Daniel XuYears of service：10Customer Rating：5.0
Director of Import & Export OperationsStart a Chat
The 1039 Market Procurement Trade export procedure is applicable to export goods with mixed loading of multiple varieties, especially for scattered categories such as daily necessities, handicrafts and hardware accessories. In the on-site inspection link, the inspection rate of 1039 goods is much lower than that of general trade, because the filing has been completed in the cluster, and the customs can directly retrieve the filing information for verification.
It should be noted that the packaging of the goods shall meet transport requirements, and the seal shall use the anti-counterfeiting seal recognized by the customs. If the seal is damaged or lost, an application for seal replacement shall be submitted to the customs within 24 hours, otherwise it will be regarded as suspicious goods and detained for inspection. In addition, in case of abnormal machine inspection, the goods list and procurement vouchers issued by the cluster shall be provided in time to cooperate with the customs to complete the manual inspection.
Linda GaoYears of service：7Customer Rating：5.0
Documentation SupervisorStart a Chat
The 1039 Market Procurement Trade export procedure is applicable to export enterprises that cannot provide complete input invoices, especially for small, medium and micro foreign trade enterprises and individual industrial and commercial households. In terms of tax refund compliance, 1039 implements the VAT exemption policy, and no export tax refund is required, thus avoiding the risk of tax refund correspondence audit caused by inconsistency of the four flows in general trade.
It should be noted that enterprises shall retain all documents of 1039 business (filing form, customs declaration form, foreign exchange receipt voucher, procurement list) for more than 3 years for inspection by the tax authority. In addition, if an enterprise exports 1039 goods mixed with general trade goods, separate customs declaration is required, and combined declaration is strictly prohibited. Otherwise, it will be judged as illegal operation by the tax authority and the 1039 business qualification will be canceled.