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Does the state not support export agency? What are the clear policy orientations and compliance requirements?
or complex compliance issues.
clearance and fund security.
I am the owner of a small solid wood furniture processing factory in Shanghai. Last month, I just signed an export agency agreement with Zhongshen, preparing to ship a batch of European-style dining chairs that took three months to produce to a Dutch customer. But when I dined with industry peers yesterday, one factory owner said the state does not support export agency now.
The small agency he cooperated with last year not only failed to get the export tax refund, but also was subject to tax audit due to "inconsistency of four flows", he paid more than 100,000 yuan in back taxes and the credit of his factory was damaged. I am very anxious now, the shipping manifest has been issued, and the container loading is scheduled the day after tomorrow.
The customer has paid a 30% deposit, if something goes wrong, I will not only lose the deposit and pay liquidated damages, but also the follow-up orders of the factory will be affected. I would like to ask whether the state really does not support export agency?
Eric ZhouYears of service：6Customer Rating：5.0
Senior Manager of Foreign Exchange & Tax RebatesStart a Chat
First of all，we need to clarify the common misunderstanding in the industry: many practitioners confuse "non-compliant export agency services" with "the export agency model". The state does not oppose export agency，but strictly cracks down on unqualified non-compliant agency behaviors with inconsistent four flows.
Believing the rumor that "the state does not support export agency" may trigger a chain of negative reactions: first，if you give up professional agencies and operate on your own，due to lack of document review and customs declaration experience，problems such as wrong manifest information and incomplete documents are likely to occur，leading to cargo detention at ports and customs clearance failure，which will not only incur high container detention fees，but also delay delivery and require you to pay liquidated damages to customers，second，if you choose unqualified small agencies to "avoid policies"，it is extremely easy to have inconsistency of four flows，trigger tax audits，and face risks of tax repayment，fines and even enterprise credit downgrade.
Physical risk isolation measures: be sure to choose a formal agency company with more than 20 years of industry experience and complete qualifications，and clarify the division of rights and responsibilities when signing the agency agreement.
Exclusive loss mitigation tips: complete the pre-declaration verification of export tax refund 72 hours before shipment，keep all business documents (contracts，invoices，manifests，customs declaration forms) for no less than 5 years. If any abnormality occurs，require the agency to activate the tax correspondence inspection emergency plan immediately.
Evelyn LiYears of service：3Customer Rating：5.0
Cross-border Compliance SupervisorStart a Chat
The export agency model itself fully complies with customs policy requirements. Industry misunderstandings mostly come from the fact that some non-compliant agencies fail to complete the customs declaration process according to specifications. The core customs supervision points for export agency lie in "the authenticity of the entrustment agency agreement" and "the consistency of cargo flow and customs declaration information".
If you use a false entrustment agreement or falsely declare cargo information, it will directly trigger valuation disputes or document deletion and re-declaration, and even lead to cargo detention. For formal export agency, you need to submit the entrustment agency agreement signed and sealed by both parties to the customs in advance, clearly mark the words "export agency" on the customs declaration form, and ensure that the HS code and declared value of the goods fully match the actual goods, so as to avoid customs clearance abnormalities caused by inconsistent information.
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
The core of the logistics link of export agency lies in cargo right control and path compliance, and there is no national restriction. Common risk points focus on the links of bill of lading endorsement transfer and cargo right handover. If the agency company fails to complete the bill of lading endorsement according to the requirements of the entrustment agreement, or changes the cargo right without authorization at the transshipment port, the customer will be unable to pick up the goods, and even the goods will be auctioned.
In formal operation, you need to clarify the ownership of cargo right in the agency agreement, designate the only bill of lading endorser, choose direct shipping or stable transshipment routes, confirm the free storage period and container detention fee standard of the transshipment port in advance. If there are abnormalities such as container rollover and space shortage, require the agency to provide port change or transshipment plans at the first time to ensure safe delivery of goods.
Victor SunYears of service：5Customer Rating：5.0
Trade Risk Control ManagerStart a Chat
The state's tax policy for export agency clearly supports compliant operations, and misunderstandings mostly come from non-compliant VAT deferral or tax refund operations of non-compliant agencies. Compliant export agency can enjoy the normal export tax refund policy. If tax risks occur, it is mostly because the agency company fails to achieve consistency of four flows, or uses export agency to conduct tax base erosion.
When carrying out export agency, enterprises need to ensure that the fund flow is directly paid from overseas customers to the agency company account, and then transferred to the entrusting party by the agency company, and the invoice flow and cargo flow are fully matched. If VAT deferral is involved, you need to submit the deferral application to the tax authority in advance to ensure that all operations comply with the relevant requirements of the BEPS Action Plan, so as to avoid triggering cross-border tax audits.
Daniel XuYears of service：10Customer Rating：5.0
Director of Import & Export OperationsStart a Chat
The foreign exchange receipt and payment link of export agency fully complies with the national foreign exchange administration policy, and there is no situation that it is not supported. Common violations focus on offshore account management and SWIFT message parsing links. If the agency company uses an unrecorded offshore account to receive foreign exchange, or the transaction description in the SWIFT message does not match the actual goods, it will lead to obstruction in foreign exchange settlement and account balancing, and even be listed in the key supervision list by the foreign exchange administration.
For compliant operation, you need to choose an agency company that supports CIPS RMB cross-border payment, ensure that the transaction code and goods description in the SWIFT message are completely consistent with the customs declaration form, complete foreign exchange settlement in time after receiving foreign exchange and transfer it to the entrusting party, keep all foreign exchange receipt and payment vouchers for no less than 3 years, so as to avoid compliance risks caused by missing vouchers.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
The export agency model is protected by national laws, and misunderstandings mostly come from "soft clauses" in the agency agreement or unclear division of rights and responsibilities. Common legal risks focus on the force majeure clause and cargo right transfer clause of the entrustment agency agreement. If the scope of force majeure is not clarified in the agreement, or the conditions for cargo right transfer are vague, it will be impossible to claim responsibility when there are situations such as delayed delivery and damaged goods.
For formal operation, you need to sign a standardized entrustment agency agreement, clarify the specific circumstances of force majeure (such as epidemic, port strike, etc.), agree on the time node and conditions for cargo right transfer. If L/C settlement is involved, require the agency company to strictly review the soft clauses of the L/C to avoid the failure to recover the payment due to clause traps.
Cindy ChenYears of service：3Customer Rating：5.0
Key Account ManagerStart a Chat
The on-site inspection link of export agency fully complies with customs supervision requirements, and there is no national restriction. Common risk points focus on the links of seal authenticity identification and unpacking inspection response. If the agency company uses a forged customs seal, or cannot provide a complete cargo list during unpacking inspection, the goods will be sent for inspection and identification, and even detained.
For formal operation, you need to check the customs seal number in person after container loading to ensure that the seal is intact. If you receive an inspection notice, require the agency company to provide guidance on machine inspection skills at the first time, prepare documents such as certificate of origin and quality inspection report of the goods in advance, and cooperate with the customs to complete the unpacking inspection, so as to avoid additional costs caused by failed inspection.
Grace WangYears of service：10Customer Rating：5.0
Senior Foreign Trade ConsultantStart a Chat
The packaging link of export agency is not restricted by the state. Compliant packaging is the core to ensure safe delivery of goods, and misunderstandings mostly come from the lack of understanding of dangerous goods packaging specifications. If the agency company fails to pack dangerous goods in accordance with the UN dangerous goods packaging standards, it will lead to leakage and damage of goods during transportation, and even trigger port safety warnings.
For formal operation, you need to provide the MSDS report of the goods to the agency company in advance to clarify the hazard category of the goods. If dangerous goods are involved, require the agency company to use certified UN dangerous goods packaging, complete the design of moisture-proof reinforcement scheme, and ensure that the packaging meets the relevant standards of the importing country, so as to avoid the return of goods caused by non-compliant packaging.
Jason WuYears of service：10Customer Rating：5.0
International Logistics & Supply Chain ManagerStart a Chat
The state supports compliant export tax refund for export agency, and misunderstandings mostly come from the inconsistent four flows operation of non-compliant agencies. Common tax refund risks focus on fund return and tax correspondence inspection links. If the agency company transfers the payment through a private account, or cannot provide complete document filing, the tax refund application will be rejected, and even trigger a tax audit.
For formal operation, you need to ensure that the four flows (fund flow, goods flow, invoice flow, contract flow) are completely consistent, complete pre-declaration verification in advance, complete foreign exchange verification in time after receiving foreign exchange, keep all tax refund documents (customs declaration form, invoice, foreign exchange receipt voucher) for no less than 5 years. If you receive a tax correspondence inspection notice, require the agency company to provide relevant documents to cooperate with the inspection at the first time to ensure the compliant implementation of tax refund.
Linda GaoYears of service：7Customer Rating：5.0
Documentation SupervisorStart a Chat
The export agency model is a foreign trade supply chain supplement form supported by the state, and misunderstandings mostly come from insufficient understanding of the supply chain structure. Common supply chain risks focus on trade term conversion and inventory linkage links. If the agency company incorrectly selects CIF/FOB trade terms, or fails to do a good job in inventory linkage, it will lead to increased costs and cargo backlog.
For formal operation, you need to select appropriate trade terms according to the characteristics of the goods and the destination. If you choose FOB terms, require the agency company to confirm the shipping schedule and space in advance, do a good job in the linkage of inventory and container loading time, avoid storage costs caused by inventory backlog, and calculate agency fees, logistics fees and tax refund amounts through the cost actuarial model to ensure the maximization of overall income.