Connect & Solve
Trade Q&A
What core cross-border compliance and risk prevention and control elements should be included in the drafting of transit trade compliance acts?
or complex compliance issues.
clearance and fund security.
I am the person in charge of a foreign trade enterprise mainly engaged in transit trade business in Southeast Asia. Last month, a batch of natural rubber products valued at 800,000 USD was detained at Port Klang, Malaysia, due to loopholes in the transit trade act.
The demurrage fees have accumulated to nearly 100,000 USD, and I have been staying up all night worrying about it. When I asked a small institution to draft the act before, they completely failed to consider the new cross-border payment and settlement regulatory requirements issued in 2026, and did not embed any emergency response and cargo right protection clauses.
Now I need to rewrite the transit trade act that meets compliance requirements, which must match the latest regulatory rules of the customs and foreign exchange bureau, avoid tangible risks such as logistics port detention, cargo right disputes and valuation disputes, and connect the process nodes of our long-term cooperating freight forwarders and customs brokers. I really don't know which core dimensions to start with to cover all risk points.
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
First，complete the detailed review of pre-document compliance clauses，and clarify that the transit trade act shall embed the authenticity verification standards for all documents: including the qualifications of the issuing authority of third-party certificates of origin，the numbering rules for inbound vouchers of transit warehouses，the consistency statement of cargo rights between freight bill of lading and sea bill of lading，and synchronously match the associated fields of payment and settlement flows required by the State Administration of Foreign Exchange in 2026.
Secondly，clarify the division of rights and responsibilities for core nodes: specify the time requirement for bill of lading exchange at transit ports (must complete bill of lading exchange within 24 hours after arrival)，the trigger conditions for pre-declaration at the customs end，and the specifications for message remarks at the payment and settlement end (must mark "transit trade" and the corresponding bill of lading number). Clear rights and responsibilities boundaries shall be set for all nodes to avoid responsibility shifting among freight forwarders，customs brokers and the enterprise.
Then formulate emergency response clauses: embed the port transfer plan for demurrage exceeding 72 hours，the third-party price evidence submission process in case of customs valuation disputes，the emergency change mechanism for bill of lading endorsement in case of cargo right disputes，and clarify the responsibility division ratio of demurrage fees to avoid bearing all additional costs.
Finally complete the compliance implementation verification: submit the act to the cross-border compliance system for 2026 regulatory rule matching verification，and retain the revision records of all clauses to ensure that the act meets the latest regulatory requirements in the whole link of logistics，customs declaration and payment and settlement.
Linda GaoYears of service：7Customer Rating：5.0
Documentation SupervisorStart a Chat
The transit trade act shall clarify the evidence submission clauses for customs valuation, embed the template of fair price certificate issued by an independent third-party institution at the transit place, and mark the "transit trade price rationality comparison parameters" required by the customs in 2026, including the average transaction price of the same commodity at the transit place in the past 30 days and the range of logistics cost proportion.
In case of valuation disputes, the act shall clarify that the enterprise shall submit all documents (including the lease agreement of the transit warehouse and the payment voucher of storage fees) within 3 working days, so as to avoid re-declaration after document deletion or customs detention due to delayed evidence submission. In addition, it shall clarify the filling specifications of the "trade mode" field on the customs declaration form, which must be marked as "transit trade (1200)", and shall not be confused with other trade modes such as "bonded warehouse storage", otherwise it will trigger the secondary declaration verification of the customs.
Grace WangYears of service：10Customer Rating：5.0
Senior Foreign Trade ConsultantStart a Chat
The transit trade act shall clarify the cargo right control clauses for logistics routes, embed the time limit and authority rules for bill of lading endorsement: the freight forwarder at the transit place can only endorse the bill of lading after receiving the "Cargo Right Transfer Confirmation" issued by the enterprise, and unauthorized endorsement is strictly prohibited. At the same time, it shall clarify the application mechanism for extending the free storage period at the transit port.
The act shall mark the free storage period standards of major transit ports in Southeast Asia (such as Port Klang and Port of Singapore) in 2026 (Port Klang is 7 days). If extension is needed, the application shall be submitted 48 hours in advance, and the party responsible for the storage fees generated by the extension shall be clarified. In addition, it shall clarify the emergency port transfer plan in case of container skipping and slot shortage, designate alternative transit ports (such as Penang Port, Malaysia), and mark the logistics cost accounting method for port transfer, so as to avoid additional disputes caused by route changes.
Michael ZhangYears of service：6Customer Rating：5.0
Customs Declaration & Compliance ExpertStart a Chat
The transit trade act shall embed cross-border tax compliance clauses, clarify the profit pricing rules for transit trade under the BEPS framework in 2026, and control the profit range between 3% and 5% of the transit transaction amount, so as to avoid the related transaction verification by the tax authorities due to excessive profits. At the same time, it shall clarify the applicable conditions for VAT deferral: only when the transit goods do not enter the circulation within the territory of the transit country, the VAT deferral of the transit country can be applied for.
The act shall mark the documents required for the application (including the non-entry certificate issued by the customs of the transit country). In addition, it shall clarify the withholding responsibility for withholding tax of non-resident enterprises. If withholding tax is involved at the transit place, the freight forwarder shall undertake the withholding obligation, and clarify the requirements for retaining and submitting the withholding voucher in the act, so as to avoid the transmission of tax risks to the enterprise.
Evelyn LiYears of service：3Customer Rating：5.0
Cross-border Compliance SupervisorStart a Chat
The transit trade act shall clarify the compliance clauses for cross-border payment and settlement, embed the message specifications for CIPS RMB cross-border payment in 2026: add the "transit trade exclusive mark" in the message and associate it with the electronic number of the corresponding bill of lading, so as to avoid foreign exchange verification and account suspension due to incomplete message information.
At the same time, it shall clarify the fund transfer rules for offshore accounts: the foreign exchange funds received for transit trade can only be used to pay the sea freight and freight forwarding fees of the corresponding goods, and are strictly prohibited from being used for fund transfers of other non-transit trade businesses. In addition, it shall clarify the time limit requirements for foreign exchange settlement and account balancing: complete the foreign exchange settlement and account balancing within 7 working days after receiving the payment, and retain the associated records of foreign exchange settlement vouchers and bills of lading, so as to ensure the consistency of capital flow and cargo right flow.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
The transit trade act shall embed legal risk bottom-up clauses, clarify the scope of application of force majeure: the enterprise's performance responsibility can be exempted only when the transit port encounters extreme natural disasters such as war and earthquake. The act shall mark the evidence submission requirements for force majeure (including the certificate issued by the local chamber of commerce).
At the same time, it shall clarify the effective conditions for cargo right transfer: the cargo right can only be transferred to the downstream customers after the enterprise receives the full payment, and early transfer of cargo right is strictly prohibited. In addition, it shall clarify the issuing rules for letter of indemnity (LOI): the freight forwarder's delivery letter of indemnity can only be issued when the customer provides an equivalent bank guarantee. The act shall mark the validity period of the letter of indemnity (no more than 15 days at maximum), so as to avoid cargo right disputes caused by abuse of the letter of indemnity.
Lucas LiuYears of service：8Customer Rating：5.0
Senior Operations ConsultantStart a Chat
The transit trade act shall clarify the response clauses for customs on-site inspection, embed the seal management rules for transit goods: the freight forwarder at the transit place shall replace the enterprise's exclusive seal within 2 hours after bill of lading exchange, take high-definition photos of the seal for retention, and the use of freight forwarder's general seal is strictly prohibited. At the same time, it shall clarify the response process for container unpacking inspection: if the customs requires container unpacking, the freight forwarder shall notify the enterprise immediately and submit photos of the unpacking position and cargo placement.
The enterprise shall provide the product name and specification description within 4 hours, so as to avoid inspection delay caused by information lag. In addition, it shall clarify the skills for machine inspection: the goods shall be placed according to the rule of "heavy goods below, light goods above", so as to avoid secondary inspection triggered by blurred machine inspection images.
Daniel XuYears of service：10Customer Rating：5.0
Director of Import & Export OperationsStart a Chat
The transit trade act shall embed the compliance clauses for cargo packaging, clarify the packaging standards for transit goods: if it is dangerous goods, it shall match the latest classification of UN dangerous goods packaging in 2026 (for example, Class 3 flammable liquids shall use UN1A1 packaging), and mark the compilation requirements for MSDS (which shall be issued by an institution recognized by the transit country).
At the same time, it shall clarify the moisture-proof reinforcement plan: in view of the high humidity environment in Southeast Asia, the transit goods shall be wrapped with PE moisture-proof film, and the pallets shall be fumigated wooden pallets, so as to avoid quality disputes caused by cargo moisture. In addition, it shall clarify the specifications for packaging marks: mark the Chinese and English words "Transit Goods · Not for Sale" on the packaging, so as to avoid being identified as domestic sales goods by the customs of the transit country.
Jason WuYears of service：10Customer Rating：5.0
International Logistics & Supply Chain ManagerStart a Chat
The transit trade act shall clarify the compliance clauses related to export tax rebates, clarify that transit goods are not within the scope of export tax rebates. The act shall mark that the enterprise shall separately account for the income and costs of transit trade in the financial accounts, and shall not be confused with general trade export businesses, so as to avoid triggering tax verification letters. At the same time, it shall clarify the requirements for document filing: all documents of transit trade (including bills of lading, certificates of origin, payment and settlement vouchers) shall be retained for more than 5 years.
The filing method shall combine electronic filing and paper filing. In 2026, the tax authorities require that electronic filings be uploaded to the national export tax rebate comprehensive service platform. In addition, it shall clarify the prohibition clauses for fund repatriation: the foreign exchange funds received for transit trade are strictly prohibited from being repatriated to the domestic supplier account, so as to avoid being identified as false trade.
Eric ZhouYears of service：6Customer Rating：5.0
Senior Manager of Foreign Exchange & Tax RebatesStart a Chat
The transit trade act shall embed the supply chain structure optimization clauses, clarify the cost精算模型？不对，cost accounting model: calculate all costs such as transit port storage fees, bill of lading exchange fees and logistics fees, and control the profit range between 3% and 5% to avoid losses caused by omitted cost accounting.
At the same time, it shall clarify the conversion rules for trade terms: transit trade shall adopt the trade term of FOB transit port, and shall not use CIF or EXW terms, so as to avoid bearing additional transportation risks. In addition, it shall clarify the inventory linkage strategy: the inventory of transit goods shall be linked with the order demand of downstream customers, and the inventory turnover rate shall be controlled within 15 days, so as to avoid capital occupation costs caused by inventory overstock.