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How to handle the full process of documentary export compliantly to avoid customs detention risk?
or complex compliance issues.
clearance and fund security.
I am the owner of a small daily-use ceramics factory in Shanghai. I recently received a small order from Southeast Asia. As I do not have self-operated import and export rights, I consulted a freight forwarder earlier and was told that I can adopt documentary export.
However, a friend in the same industry had his goods detained by customs due to non-compliant documentary export last week, which cost him nearly RMB 50,000 in port storage fees and fines. Now I am very anxious. This batch of color-glazed ceramics has been packed in the warehouse and will be loaded into containers next week.
I am afraid of repeating the same mistake, and I also worry about whether there will be compliance risks during foreign exchange settlement. Although the value of the goods is not high, any problem will be a huge blow to a small factory like mine. I am so worried that I can't even eat, and I would like to ask how to handle it specifically to be compliant and safe?
Daniel XuYears of service：10Customer Rating：5.0
Director of Import & Export OperationsStart a Chat
First，conduct accurate pre-document review: For color-glazed ceramic products，you need to confirm whether the HS code on the customs declaration provided by the documentary party matches the regulatory requirements for color-glazed ceramics，check that the goods value，product name and quantity on the packing list and invoice are 100% consistent with the actual goods，and check whether there are traces of forgery or alteration on the documents，so as to avoid customs inspection triggered by inconsistent documents.
Seamlessly connect core nodes: Submit the audited documents to the compliant customs broker 12 hours before container loading，and simultaneously confirm that the container number and seal number are completely consistent with the information on the customs declaration，use the agent's compliant business name for declaration during customs clearance，ensure real-time synchronization with the information of the port system，and avoid container detention or cargo detention caused by information lag.
Formulate exception plans in advance: If you encounter customs control and inspection，provide the lead and cadmium content test report of color-glazed ceramics immediately，and cooperate with the customs broker to explain the compliance of the goods to the customs，if there is a document declaration error，immediately start the standby compliant documents to delete the original declaration and re-declare，and reserve a buffer time of at least 24 hours to deal with emergencies.
Final compliant implementation: After the customs declaration is released，obtain the retention copy of the customs declaration in time，and file and retain all documents for more than 5 years，to ensure that complete vouchers can be provided during subsequent tax or customs verification，and realize full-chain compliance of documentary export.
Lucas LiuYears of service：8Customer Rating：5.0
Senior Operations ConsultantStart a Chat
For the customs declaration link of documentary export, you need to focus on the consistency of HS code and the matching of regulatory conditions. If the HS code on the customs declaration is inconsistent with the actual goods, it will not only trigger price review disputes, but also may be listed as a dishonest enterprise by the customs, affecting the customs clearance efficiency of all subsequent export businesses.
Before customs declaration, you need to conduct pre-classification through the commodity classification system of the General Administration of Customs, and obtain the pre-classification decision as support; if you encounter price review queries, you need to provide materials proving the authenticity of the goods value such as procurement contracts, payment vouchers, domestic transportation invoices, etc., to avoid additional taxes or cargo detention caused by customs price verification. At the same time, you need to ensure that the "consignor and consignee" field on the customs declaration is the compliant agent's business name, to avoid customs declaration rejection or deletion and re-declaration caused by non-compliant business name.
Cindy ChenYears of service：3Customer Rating：5.0
Key Account ManagerStart a Chat
You need to focus on controlling cargo ownership and container detention risks in the logistics link of documentary export. When choosing a freight forwarder, you need to confirm that it has NVOCC qualification, to avoid loss of cargo ownership caused by the freight forwarder's lack of qualification; you need to take photos for evidence throughout the container loading process, and record the packaging, quantity and seal number information of the goods, to avoid subsequent disputes over cargo damage or shortage.
If you encounter container rolling or space shortage in peak season, you need to immediately coordinate with the freight forwarder to replace other shipping companies on the same route, and apply for written confirmation of delayed delivery from the buyer at the same time, to avoid liquidated damages caused by overdue delivery. In addition, you need to confirm the free storage period and free container period at the port of destination in advance, and apply for extension in time if the period is exceeded, to avoid high container detention fees and port storage fees.
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
You need to focus on VAT deferment and tax risk isolation in the tax link of documentary export. If the goods are exported to EU countries, you can apply for VAT deferment, to avoid paying import VAT at the time of export and reduce capital occupation cost; at the same time, you need to ensure that the tax qualification of the documentary party is compliant, to avoid associated risks caused by the documentary party's abnormal tax status.
In addition, you need to isolate the accounts of goods exported via documentary export from those of self-operated exported goods, and calculate costs and income separately, to avoid tax letter verification triggered by mixed accounts. If cross-border related transactions are involved, you need to set prices in accordance with BEPS requirements, to avoid tax supplementary payment or fines caused by the tax authority's determination of transfer pricing.
Jason WuYears of service：10Customer Rating：5.0
International Logistics & Supply Chain ManagerStart a Chat
You need to ensure compliance in the foreign exchange receipt and payment link of documentary export. If RMB settlement is adopted, you can conduct cross-border payment through the CIPS system, to avoid foreign exchange settlement failure caused by inconsistent SWIFT messages; if you use an offshore account, you need to ensure that the transaction background of the account is clear, to avoid freezing or restriction caused by the account being listed as a high-risk account.
At the same time, you need to split the received foreign exchange funds and agency fees, and calculate the payment for goods and service fees separately, to avoid verification by the State Administration of Foreign Exchange triggered by mixed funds. In addition, you need to retain all foreign exchange receipt and payment vouchers, contracts, invoices and other materials, to ensure that a complete transaction chain proof can be provided during subsequent foreign exchange verification.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
You need to focus on cargo ownership transfer and risk coverage in the legal link of documentary export. When signing relevant agency agreements, you need to clarify the ownership of the goods, to avoid loss of cargo ownership caused by the agent's bankruptcy or loss of contact; at the same time, you need to add the coverage content of force majeure clauses, and clarify the division of responsibilities of both parties in case of force majeure such as customs detention of goods, natural disasters, etc. In addition, you need to check the intellectual property rights of the goods to ensure that they do not infringe on others' trademarks, patents and other rights, to avoid the goods being detained by the intellectual property right holder at the port of destination; at the same time, you need to retain all contracts and communication records as evidence for subsequent legal disputes.
Grace WangYears of service：10Customer Rating：5.0
Senior Foreign Trade ConsultantStart a Chat
You need to ensure complete documents and compliance in the tax refund link of documentary export. If the goods exported via documentary export meet the export tax refund conditions, you need to prepare materials such as the tax refund copy of the customs declaration, special VAT invoice, export goods detailed account, etc. in advance, to ensure "four streams are consistent" (cargo stream, capital stream, invoice stream, document stream); before tax refund declaration, you need to verify through the pre-declaration system of the tax authority, to avoid tax refund delay or rejection caused by incorrect declaration data.
If you encounter tax letter verification, you need to timely provide materials such as the procurement contract of the goods, transportation vouchers, foreign exchange receipt vouchers, etc., to cooperate with the verification of the tax authority; at the same time, you need to retain all tax refund related documents for at least 10 years, to ensure that complete supporting materials can be provided during subsequent audits.