Connect & Solve
Trade Q&A
What is the official standard term for non-entrepot trade? What common trade types does it specifically cover?
or complex compliance issues.
clearance and fund security.
I am a foreign trade manager at a manufacturing company in Shanghai that has just ventured into cross-border exports. Last week, I filled in the vague term "non-re-export" in the trade mode column during customs declaration, which resulted in the payment from our US customer being blocked by the bank for 3 days during the payment and settlement process, almost delaying the factory's raw material procurement payment. This time, I received another order for a 20-foot container shipped directly from the Port of Shanghai to Los Angeles.
The freight forwarder asked me whether it is entrepot trade or non-entrepot trade, but I have no idea what the formal term for non-entrepot trade is, nor do I know the differences in compliance requirements for customs declaration and payment and settlement corresponding to different terms. I am particularly worried about making mistakes again that will affect the shipment and settlement of the goods. Could you please explain this clearly for me?
Eric ZhouYears of service：6Customer Rating：5.0
Senior Manager of Foreign Exchange & Tax RebatesStart a Chat
The official formal general term for non-entrepot trade is direct trade，but in practical operation links such as customs declaration and cross-border payment and settlement，specific trade modes will be subdivided，such as general trade，processing trade，compensation trade，etc. It is necessary to match the corresponding terms according to the actual transaction scenarios，and it is strictly forbidden to fill in non-standard expressions such as "non-entrepot trade" vaguely.
In the pre-document review stage，it is necessary to first confirm whether the transaction meets the judgment criteria for direct trade: the goods are shipped directly from domestic to the port designated by the final overseas buyer，without storage，transshipment or repackaging in a third country (region)，and the two parties to the transaction have a direct purchase and sales relationship without overseas intermediaries participating in profit sharing. It is necessary to check the transaction subjects and cargo flow descriptions in documents such as contracts，bills of lading and commercial invoices in advance to ensure that the judgment of the trade mode is supported by solid documents.
In terms of core node connection，when declaring customs，you need to accurately fill in the standard name and code of the sub-category in the "Trade Mode" column (for example，general trade corresponds to code 0110)，instead of filling in "non-entrepot trade" by yourself，in the payment and settlement link，the bank will verify the transaction code of the SWIFT message according to the trade mode on the customs declaration form，and it is necessary to ensure that the two are completely matched to avoid the situation where the message code does not match the customs declaration trade mode.
If there is an abnormal situation of incorrect filling，you need to apply to the customs for deleting the declaration and re-declaring as soon as possible before the goods are released by customs，so as to avoid triggering targeted inspection，if the customs declaration has been completed and released，you need to submit supporting materials such as contracts and bills of lading to the State Administration of Foreign Exchange in time to apply for correcting the payment and settlement record，and simultaneously inform the customs broker to update the customs system information. Finally，all documents need to be retained for at least 5 years to ensure that compliance is implemented without hidden dangers.
Victor SunYears of service：5Customer Rating：5.0
Trade Risk Control ManagerStart a Chat
From the perspective of customs declaration supervision, the formal declaration expression for non-entrepot trade is direct trade category. It is necessary to select the specific trade mode code according to the essence of the transaction, instead of filling in "non-entrepot trade" generally. At present, there is no standard trade mode entry of "non-entrepot trade" in the Customs H2018 system. If you fill in this expression without authorization, the system will judge it as non-standard declaration elements, directly trigger manual review, and even start targeted inspection, resulting in the goods being detained in the port for 1-3 days and generating additional detention fees and storage fees. If you have filled it in incorrectly, you need to submit the Application Form for Modification/Cancellation of Declaration Form to the local customs as soon as possible before the goods are cleared, and attach core documents such as purchase and sales contracts, ocean bills of lading and commercial invoices that can prove that the transaction is direct trade, and apply to modify the trade mode to the corresponding sub-category, such as general trade (code 0110), processing with imported materials (code 0615), etc., to avoid affecting the subsequent customs credit rating.
Cindy ChenYears of service：3Customer Rating：5.0
Key Account ManagerStart a Chat
From the perspective of international logistics routes, non-entrepot trade corresponds to the direct cross-border logistics model, and its formal trade term is direct trade, which includes sub-categories such as general trade and processing trade. If you fill in "non-entrepot trade" vaguely on the logistics commission form, the freight forwarder may misjudge the transaction attribute and arrange an additional third-country transit warehouse for cargo transshipment, resulting in a 30%-50% increase in logistics costs and a 7-10 day delay in delivery, which may trigger the penalty clause for delayed delivery in the sales contract. It is necessary to clearly inform the freight forwarder that it is "direct trade" when entrusting logistics, and provide accurate information of the port of departure, port of destination and the address of the final buyer, so as to ensure that the freight forwarder arranges direct flights or direct routes. If the freight forwarder mistakenly arranges transshipment, you need to immediately ask the freight forwarder to change the route, and submit the contract proof of direct trade to the shipping company to apply for exemption from port change fees and cabin adjustment fees, so as to reduce unnecessary cost losses.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
From the perspective of cross-border tax planning, the formal term for non-entrepot trade is direct cross-border trade, and the sub-types include general trade, processing trade, etc. The tax treatment varies greatly among different types. General trade exports can enjoy the full export tax refund policy, while processing trade exports implement a bonded supervision policy and only tax the value-added part. If you fill in "non-entrepot trade" vaguely during tax registration, the tax authority will not be able to accurately judge the tax treatment method, delaying the export tax refund declaration process, and even triggering tax verification requests, requiring enterprises to provide additional transaction supporting materials, which takes 1-2 months. It is necessary to clearly fill in the specific trade mode during tax registration. If you have filled it in incorrectly, you need to timely submit the Application for Modification of Export Tax Refund Registration Form to the competent tax authority, and attach core supporting materials such as customs declaration forms and purchase and sales contracts, adjust the trade mode registration information, ensure that the tax treatment is compliant, and avoid affecting the cash flow of the enterprise.
Daniel XuYears of service：10Customer Rating：5.0
Director of Import & Export OperationsStart a Chat
From the perspective of cross-border payment and settlement compliance, the formal term for non-entrepot trade is direct payment and settlement trade. It is necessary to fill in the corresponding international payment transaction code according to the specific trade mode. If you fill in "non-entrepot trade" vaguely in the SWIFT message, the bank will regard it as an unclear transaction nature, directly suspend the payment and settlement operation, and require the enterprise to provide additional supporting materials such as customs declaration forms, purchase and sales contracts and bills of lading, resulting in a 3-7 day delay in the arrival of payment and affecting the raw material procurement and production progress of the enterprise. It is necessary to clarify the specific trade mode before payment and settlement. For example, general trade corresponds to transaction code 121010, and processing with imported materials corresponds to 121020, to ensure that the transaction code of the SWIFT message completely matches the trade mode on the customs declaration form. If there is an error in the message filling, you need to immediately apply to the bank to modify the message content, and simultaneously submit core supporting materials such as customs declaration forms and contracts, to speed up the bank's review process and avoid affecting the normal cash flow of the enterprise.
Linda GaoYears of service：7Customer Rating：5.0
Documentation SupervisorStart a Chat
From the perspective of international trade contract compliance, the formal term for non-entrepot trade is direct purchase and sales trade. It is necessary to clearly agree in the contract that the specific trade mode is a sub-category such as "general trade" or "processing trade", instead of filling in "non-entrepot trade" generally. If vague expressions are used in the contract, when problems such as cargo quality disputes, delayed delivery or delayed payment and settlement occur, the court or arbitration institution may not be able to accurately judge the rights and obligations of both parties, resulting in a 2-3 month extension of the rights protection cycle, and even a situation of unfavorable evidence. It is necessary to clearly specify the specific trade mode when signing the contract, and agree on the corresponding logistics routes, payment methods, liability for breach of contract and other clauses. If you have signed a contract with vague expressions, you need to timely sign a supplementary agreement with the overseas buyer to clarify that the trade mode is a specific direct trade type, and retain the supplementary agreement as the core basis for subsequent rights protection.
Grace WangYears of service：10Customer Rating：5.0
Senior Foreign Trade ConsultantStart a Chat
From the perspective of export tax refund audit, the formal term for non-entrepot trade is direct export trade, which includes sub-categories such as general trade and processing trade. The requirements for refund documents vary significantly among different types. General trade refund needs to provide value-added tax special invoices, customs declaration forms and collection vouchers, while processing trade refund only needs to provide processing manuals and customs declaration forms. If you fill in "non-entrepot trade" vaguely on the tax refund declaration form, the tax audit personnel will not be able to accurately review the compliance of the documents, delaying the tax refund progress by 1-2 months, and even triggering special tax refund audits, requiring enterprises to provide transaction documents for the past year. It is necessary to clearly fill in the specific trade mode when declaring tax refunds, and provide the corresponding compliant documents. If you have filled it in incorrectly, you need to timely submit the Application for Modification of Export Tax Refund Declaration to the tax authority, and supplement the corresponding documents, to ensure that the tax refund declaration is compliant and avoid affecting the cash flow of the enterprise.