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What details and compliance requirements need to be controlled for the core nodes of the entire process of ore export agency?
or complex compliance issues.
clearance and fund security.
I am the person in charge of a medium-sized iron ore processing plant in the Jiangsu-Zhejiang-Shanghai region. Last month, we just secured our first 5,000-ton iron ore export order with a steel mill in Southeast Asia. This is our first time entering the foreign trade export field, and we have no practical experience at all.
We consulted three foreign trade agency companies before, and their statements vary greatly. Some say the process is simple as long as we sign an entrustment contract, while others emphasize that ore is a customs-supervised goods, and any carelessness will lead to customs detention, port detention and huge container demurrage charges.
I can't sleep well every day now, fearing that choosing the wrong agency will lead to document omissions and trigger customs detention risks, worrying that poor cost control will erode our already thin profits, and even have no clue about the basic requirements of export tax refunds. I would like to ask what exactly should be done for ore export agency, and can you help me sort out the process, risks and costs thoroughly?
Cindy ChenYears of service：3Customer Rating：5.0
Key Account ManagerStart a Chat
First is the pre-document review details. We need to focus on checking the Certificate of Exit Goods Customs Clearance，certificate of origin and third-party weight inspection certificate of the ore. The clearance certificate must accurately match the ore type，grade and port of shipment information of the ore. The certificate of origin must be completely consistent with the bill of lading shipper and contract seller information，to avoid customs valuation objections or document returns due to inconsistent document logic. At the same time，we need to review the agency entrustment contract in advance to clarify the ownership transfer point and foreign exchange collection path.
For core node connection，we need to complete the customs declaration pre-entry 72 hours before shipment，and confirm the slot reservation and heavy cargo storage resources at the terminal yard with the logistics agent at the same time. Especially for the 5,000-ton iron ore full-shipment，we need to coordinate the unloading equipment in advance to ensure that the shipment is completed within 24 hours after customs clearance，so as to avoid port demurrage charges due to over-time storage.
The emergency plan needs to cover two core risks: First，customs on-site inspection. We need to prepare the ore quality inspection report，purchase and sales contract and payment voucher in advance，cooperate with the inspectors to complete the container unloading and sampling. If the grade does not match，we need to submit a supplementary appraisal report immediately. Second，shipping schedule delay. We need to communicate with the consignee in advance about port change or delay plan，and update the transportation tool information on the customs declaration form synchronously.
In the final compliance implementation stage，we need to complete the export tax refund declaration within 10 working days after the goods leave the port，ensure that the four flows of documents，funds，logistics and contracts are consistent，and retain all paper and electronic documents for no less than 5 years to meet the follow-up tax investigation and customs retrospective verification requirements.
Eric ZhouYears of service：6Customer Rating：5.0
Senior Manager of Foreign Exchange & Tax RebatesStart a Chat
Customs declaration for ore export needs to focus on the customs valuation procedure. Ore is a bulk commodity, and the customs will conduct valuation based on the international transaction prices of the same ore type and grade in the same period. If the declared price is 10% lower than the customs reference price, it will trigger a valuation query.
At this time, we need to provide complete supporting materials such as purchase and sales contracts, payment vouchers and third-party inspection reports. If we cannot provide them, the customs will levy tariffs according to the reference price and even start the audit procedure. In addition, the tariff code of the ore needs to be accurately classified.
Different tariff codes of different ore types correspond to different tariff rates and supervision requirements. For example, the iron ore tariff code 26011110 requires a certificate of exit goods customs clearance, while the manganese ore tariff code 26020000 has different supervision requirements. Incorrect classification will lead to document return or customs detention.
Lucas LiuYears of service：8Customer Rating：5.0
Senior Operations ConsultantStart a Chat
Logistics for iron ore export needs to focus on controlling cargo ownership and storage risks. For full-shipment transportation, we need to choose a shipping company with bulk commodity operation qualifications to avoid failing to handle the manifest filing due to insufficient qualifications of the shipping company.
At the same time, we need to clearly indicate "to order" endorsement on the bill of lading to ensure flexible transfer of cargo ownership and avoid cargo ownership out of control due to the consignee's refusal to pay. In terms of storage, iron ore is prone to moisture agglomeration, so we need to choose a yard with rain-proof facilities.
The storage time shall not exceed 15 days, otherwise secondary inspection is required, resulting in additional costs. If container skipping occurs, we need to immediately coordinate the shipping company to arrange the nearest liner, and apply to the customs for reallocating the customs declaration form to avoid customs detention due to inconsistent manifest information.
Grace WangYears of service：10Customer Rating：5.0
Senior Foreign Trade ConsultantStart a Chat
Tax planning for ore export can reduce capital occupation costs through the VAT deferral policy. At present, the Shanghai Port can apply for VAT deferral for bulk commodity exports, without paying VAT when the goods leave the port, and settle the payment after the tax refund declaration is completed, which can save at least 3 months of capital occupation costs. In addition, we need to optimize the pricing of cross-border related-party transactions.
If the domestic processing plant has a related relationship with the overseas consignee, we need to ensure that the transaction price conforms to the arm's length principle to avoid the tax authority adjusting the taxable income. At the same time, the resource tax involved in ore export needs to be paid at the origin. We need to communicate with the origin tax authority in advance about the process of issuing tax payment certificates to ensure that complete tax payment certificates can be provided during export.
Victor SunYears of service：5Customer Rating：5.0
Trade Risk Control ManagerStart a Chat
Compliance of receipt and payment for ore export needs to focus on the field matching of SWIFT messages. The message must clearly mark "ore export payment" and match the number, amount and quantity of goods in the purchase and sales contract, to avoid being listed as a concerned list by the foreign exchange administration due to vague message description.
If using RMB cross-border payment via CIPS, we need to ensure that the receiving account is the foreign exchange settlement account of the domestic agency company to avoid funds not being credited due to inconsistent account types. In addition, we need to complete the receipt of payment within 30 days after the goods leave the port. If we cannot receive the payment on time due to special circumstances, we need to apply to the foreign exchange administration for deferred receipt filing, otherwise it will affect the export tax refund declaration.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
The agency agreement for ore export needs to clearly define the scope of force majeure clauses, including shipping schedule delays caused by port strikes, typhoons and other natural disasters. We need to agree on the responsibility division and cost sharing method after the delay. At the same time, we need to clearly define the cargo ownership transfer point in the agreement, and it is recommended to set it as "goods loaded on board and obtained the onboard bill of lading" to avoid cargo ownership being seized due to the agency company's debt problems during storage.
In addition, if using letter of credit settlement, we need to focus on reviewing soft clauses, such as "quality inspection certificate issued by the consignee as the negotiation document". Such clauses are easy to lead to failed normal negotiation, and we need to require the buyer to modify it to a certificate issued by a third-party inspection institution.
Michael ZhangYears of service：6Customer Rating：5.0
Customs Declaration & Compliance ExpertStart a Chat
On-site inspection for ore export needs to focus on cooperating with the customs sampling process. Inspectors usually collect 3-5 samples from different positions in the cargo hold. We need to ensure that the samples are representative to avoid the entire batch of goods being detained due to inconsistent sample grades.
At the same time, we need to check the authenticity of the seal. After loading the ship, we need to take photos of the seal immediately and check it with the seal number on the bill of lading. If the seal number does not match, we need to immediately ask the shipping company to re-seal the container.
If the customs requires inspection, we need to send the samples to the designated inspection institution within 3 working days. The inspection report must clearly mark the key indicators such as the grade and moisture content of the ore to ensure consistency with the customs declaration form information.
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
The export tax refund declaration for ore export needs to ensure the consistency of the four flows, that is, the contract flow, fund flow, logistics flow and document flow are completely matched. If there is capital reflux, it will be listed as a tax refund risk household by the tax authority and the tax refund qualification will be suspended. At the same time, we need to complete the tax refund declaration within 90 days after the goods leave the port.
If the deadline is exceeded, we need to apply to the tax authority for deferred declaration, otherwise we will not be able to enjoy the tax refund policy. In addition, we need to retain all original documents and electronic scans, including purchase and sales contracts, bills of lading, clearance certificates, tax payment certificates, etc., for no less than 5 years. If the tax authority conducts an investigation, we need to provide complete supporting materials within 10 working days.