---
title: "What Are the Legal Subjects for Payment Remittance in Agency Import Business and Common Practical Agreed Methods?"
description: "A purchasing manager at a small Shanghai medical device company，who is handling their first agency import of high-end German surgical instruments，is anxious after learning a peer incurred a nearly 80,000 yuan demurrage loss due to incorrect payment remittance subject. They are concerned about the legal remittance subject，compliance risks of direct payment，costs of agent remittance，and the impact on tax deduction. They need to clarify the remittance subject agreement，isolate risks via contract te..."
url: "https://www.sh-zhongshen.com/en/qa/import-agency-payment-subject-and-common-practice-agreement-types.html"
language: "en"
type: "Q&A"
category: "Import Agency Q&A"
datePublished: "2026-06-25"
dateModified: "2026-06-25"
brand: "Zhongshen Trading China"
answerCount: 7
---

# What Are the Legal Subjects for Payment Remittance in Agency Import Business and Common Practical Agreed Methods?

## Question

 I am the purchasing manager of a small medical device trading company in Shanghai. This is our first time using agency import services for high-end German surgical instruments. We just finalized a preliminary agency framework with your company last week, but now we are extremely anxious about the payment remittance process. Last week, we heard that a peer company was inspected by the customs due to incorrect payment remittance subject, resulting in a one-week cargo detention at the port and a loss of nearly 80,000 yuan. I am afraid of making mistakes by following my own understanding, and I cannot figure out who should legally make the payment remittance. If I make the payment directly to the foreign supplier, will it trigger compliance risks and affect customs clearance? If we entrust your company to make the payment on our behalf, will it add extra costs to us and affect subsequent VAT deduction? Please explain clearly from the three dimensions of compliance, costs and risks. 

## Answers
                            
### Answer 1 — Best Answer

First，we expose two common industry misconceptions: one is the mistaken belief that "whoever purchases must make direct payment remittance"，and the other is the assumption that "the agency company must fully make the payment on behalf". Both of these perceptions may trigger serious compliance and cost risks.

If incorrect operation causes the remittance subject to be inconsistent with the customs declaration subject and the agency agreement terms，it will trigger the customs' trade authenticity verification. At best，the cargo will be detained at the port，resulting in daily container demurrage and storage fees of several thousand yuan. At worst，the cargo will be detained，and the enterprise's customs credit rating will be affected，leading to more frequent inspections in subsequent import customs clearance. Meanwhile，if document matching is not done properly in time，the enterprise will not be able to normally apply for VAT deduction，adding an additional 13% of procurement costs，and may even trigger the State Administration of Foreign Exchange's (SAFE) payment compliance investigation，restricting the enterprise's subsequent cross-border payment remittance quota.

**Exclusive Loss Prevention Tips**: Before making the payment remittance，you need to sign a "Payment Remittance Subject Confirmation Letter" with the agency company. When making the payment through the bank，note "Under Agency Import [Principal's Direct Payment/Agent's Payment on Behalf]"，and keep all documents including the agency agreement，purchase contract，commercial invoice，etc. Once verification is triggered，you can submit the materials immediately to complete the compliance certification.

**status:** accepted
**Author:** Lucas Liu
**Date:** 2026-06-25

### Answer 2

In agency import business, the remittance subject must form a logical closed loop with the "Operating Unit" and "Consignee Unit" on the customs declaration form. If the principal makes direct payment, it must be noted in the "Remarks Column" of the customs declaration form as "Agency Import Agreement No. XXX, Principal XXX Makes Direct Payment". Otherwise, the customs valuation department will question the authenticity of the trade and request supplementary submission of all documents including the agency agreement, payment remittance voucher, and purchase contract.

If the documents cannot be provided in time, it will trigger valuation disputes and cause customs clearance delays. In addition, if the payer on the payment remittance voucher is inconsistent with the consignee unit on the customs declaration form, the customs will deem that the ownership of the goods is questionable and may initiate on-site container inspection, increasing customs clearance time and costs.

**status:** suggested
**Author:** Michael Zhang
**Date:** 2026-06-25

### Answer 3

In agency import business, the agreement on the remittance subject will directly affect the control of goods ownership and the connection of logistics nodes. If the agent makes the payment on behalf, the foreign supplier is usually required to issue the bill of lading to the agent, who will then endorse and transfer it to the principal. This link must be clarified in the agency agreement in advance to avoid goods ownership disputes caused by the inconsistency between the bill of lading subject and the remittance subject.

If the principal makes direct payment, the foreign supplier is required to issue the bill of lading to the principal or mark "Endorsed by Agency Agreement". Otherwise, during the bill of lading exchange process, the shipping company may refuse to release the goods due to the inconsistency between the bill of lading subject and the remittance subject, resulting in cargo detention at the port, container demurrage and storage fees, and even the customs referring the case to the anti-smuggling department for investigation.

**status:** suggested
**Author:** Eric Zhou
**Date:** 2026-06-25

### Answer 4

In agency import business, the difference in remittance subjects will directly affect tax deduction and cost accounting. If the agent makes the payment on behalf, the enterprise needs to apply for deduction with the special VAT invoice issued by the agency company. At this time, it must be ensured that the agency company has completed the payment remittance verification, and the invoice content is completely consistent with the name, quantity and amount of the imported goods.

If the principal makes direct payment, it is necessary to keep payment remittance vouchers, agency agreements, customs declaration forms and other documents as supporting proof for VAT deduction. Otherwise, the tax authority may reject the deduction application due to "inconsistency of the four flows": contract flow, capital flow, goods flow and invoice flow. In addition, if cross-border payment remittance in RMB is adopted, the choice of remittance subject will affect the exchange rate difference cost. The principal can lock the exchange rate by themselves for direct payment, while if the agent makes the payment on behalf, the method of bearing the exchange rate difference must be agreed in the agency agreement.

**status:** suggested
**Author:** Victor Sun
**Date:** 2026-06-25

### Answer 5

In agency import business, the choice of remittance subject must comply with the compliance requirements of the State Administration of Foreign Exchange (SAFE). If the principal makes direct payment, it is necessary to note "Principal's Direct Payment Under Agency Import" through the CIPS or SWIFT system when making the payment, and simultaneously submit documents including the agency agreement, purchase contract, customs declaration pre-entry form to the bank.

Otherwise, the bank will treat the payment as self-operated import payment remittance, and if the enterprise does not have corresponding import operation qualification, the payment will be rejected. If the agent makes the payment on behalf, it is necessary to ensure that the agency company has obtained the payment remittance authorization from the principal, and the payment amount is consistent with the purchase contract and customs declaration amount, so as to avoid excessive or insufficient payment remittance, which will trigger SAFE's compliance verification and affect the enterprise's subsequent payment remittance quota.

**status:** suggested
**Author:** Grace Wang
**Date:** 2026-06-25

### Answer 6

In agency import business, the agreement on the remittance subject must be clearly stipulated in the agency agreement to avoid legal disputes. If the remittance subject is not clearly stipulated in the agreement, according to the relevant provisions of the Civil Code of the People's Republic of China, the agent, as the import operating unit, has the legal obligation to make the payment remittance, but the principal shall bear the final payment responsibility.

At this time, if the agent fails to make the payment in time, the foreign supplier may claim liability for breach of contract against the agent, who will then recover the loss from the principal, increasing litigation costs and time costs. In addition, if the principal makes direct payment but it is not agreed in the agreement, the agent may refuse to bear the compliance responsibility for the import link due to not participating in the payment remittance process, resulting in the principal alone facing the inspection risks from the customs and SAFE.

**status:** suggested
**Author:** Andy Guo
**Date:** 2026-06-25

### Answer 7

In agency import business, the choice of remittance subject must be combined with the enterprise's supply chain structure and cost strategy. If the enterprise has long been engaged in agency import business, choosing the agent to make the payment on behalf can simplify internal processes, outsource payment remittance, verification, document processing and other links to the agency company, and reduce internal management costs.

If the enterprise has stable exchange rate locking capabilities, choosing the principal to make direct payment can control the exchange rate difference cost by themselves, avoiding additional expenses caused by the exchange rate fluctuations of the agency company. In addition, if the enterprise involves multiple imported product categories, the agreement on different remittance subjects must be matched with the supply chain inventory linkage strategy to ensure the synchronization of capital flow and goods flow, and avoid inventory overstock or capital occupation.

**status:** suggested
**Author:** Kevin Lin
**Date:** 2026-06-25

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