What are the full compliance procedures and core risk avoidance points for sanitary napkin import agency?

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I am the procurement head of a medium-sized domestic daily necessities wholesale company. I have recently secured the domestic agency rights for two niche Japanese organic sanitary napkin brands. My boss is pushing for the first batch of goods to be launched in time for the 618 e-commerce grand promotion within three months, but I have never been involved in the agency business of imported daily chemical products before, and I am so worried that I cannot sleep now.

Last week, I heard from peers that someone missed the import cosmetics filing certificate, resulting in 12 containers of sanitary napkins being detained at the port for 12 days, and they paid more than 80,000 yuan in port detention fees and container detention fees alone. A friend's goods were detained by customs for almost a month due to non-compliant ingredient labeling, and they suffered heavy losses after missing the promotion window.

I am afraid that wrong procedures will delay the launch, that cost overruns will lead to no profit, and even more that compliance problems will affect the company's reputation. I would like you to sort out the full process, risk avoidance points and cost control methods for agency import of sanitary napkins?

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Expert Q&A

Jason Wu
Jason WuYears of service:10Customer Rating:5.0

International Logistics & Supply Chain ManagerStart a Chat

First of all,it is necessary to complete the refined review of pre-documents: make sure that you have obtained the imported ordinary cosmetics filing certificate issued by the National Medical Products Administration,and at the same time request the official hygiene certificate and third-party ingredient test report issued by the overseas manufacturer. The ingredient labeling must strictly comply with the GB 15979-2020 standard,and prohibited ingredients and microbial indicators must not exceed the limit,so as to avoid customs detention caused by inconsistent documents.

Core nodes shall be seamlessly connected: when booking space,choose a freight forwarder with import operation qualification for daily chemical products. Submit the full set of documents for pre-review 3 working days before customs declaration,to ensure that the brand,model,ingredients and quantity in the bill of lading,invoice,packing list and filing certificate are completely consistent,so as to avoid customs declaration delay caused by information deviation and unnecessary port detention fees.

Develop abnormal plans in advance: agree on the port detention emergency plan with the agency company,and reserve a copy of the spare filing certificate. In case of customs sampling inspection,coordinate the green inspection channel in advance,if an early warning is issued due to ingredient labeling problems,immediately start the document correction process,and simultaneously communicate with overseas manufacturers to issue supplementary explanations to shorten the rectification cycle.

Final compliance implementation: after the goods arrive,cooperate with the customs to complete the commodity inspection sampling,and the goods can be stored and sold only after obtaining the *Inspection and Quarantine Certificate for Inbound Goods*. At the same time,keep all documents and test reports for at least 5 years for subsequent tax or customs inspection,so as to ensure a closed loop of compliance in the whole process.

Reference: What Core Processes Does Import Agency Service Specifically Cover?
Cindy Chen
Cindy ChenYears of service:3Customer Rating:5.0

Key Account ManagerStart a Chat

When declaring customs for agency imported sanitary napkins, they shall be accurately classified under customs code 3805901000 (disposable sanitary products). Incorrect classification may lead to valuation disputes or incorrect application of tax rates.

In addition to conventional documents, the electronic data screenshot of the filing certificate shall be submitted during customs declaration to ensure consistency with the filing information in the customs system. In case of customs valuation query, prepare the ex-factory price invoice of overseas manufacturers, brand authorization agreement, and past import declaration forms of the same model of products as supporting evidence in advance, to avoid deleting and re-submitting the declaration form due to valuation disputes and delaying customs clearance time.

At the same time, it should be noted that the "country of origin" in the customs declaration form must be consistent with the country of production in the hygiene certificate. For transshipment goods, transshipment certification documents shall be provided to avoid being judged as false reporting of the country of origin and triggering penalties.

Andy Guo
Andy GuoYears of service:3Customer Rating:5.0

Supply Chain Management ExpertStart a Chat

The logistics route for agency imported sanitary napkins shall give priority to direct routes to avoid cargo damage or delay caused by transshipment, especially for sanitary napkins made of organic materials. Ships with constant temperature and moisture-proof cabins shall be selected to avoid moisture deterioration during transportation. When booking space, confirm the free storage period and container detention fee clauses of the freight forwarder. Usually, the free storage period at the port is 7-10 days.

If it is expected that customs clearance cannot be completed in time, apply for extending the free storage period in advance to avoid high container detention fees. The bill of lading shall be "order bill of lading", and the endorsement transfer procedures shall be completed to ensure the controllability of the cargo right. If the consignee needs to be changed, notify the shipping company to handle the bill modification procedures in advance to avoid being unable to pick up the goods due to incorrect bill of lading information. At the same time, contact the freight forwarder 3 days before the arrival of the goods to prepare for bill exchange, so as to ensure the seamless connection of the customs clearance process.

Eric Zhou
Eric ZhouYears of service:6Customer Rating:5.0

Senior Manager of Foreign Exchange & Tax RebatesStart a Chat

For agency imported sanitary napkins, you can apply for VAT deferral (that is, deferred payment of import value-added tax) to reduce the capital occupation cost. Confirm in advance that the company has the qualification of general VAT taxpayer, and submit the deferral application when declaring customs. At the same time, accurately calculate the customs duty, value-added tax and consumption tax (if applicable) in the import link. The customs duty rate is 6.5%, and the value-added tax rate is 13%. If the product is an organic certified product, you can apply for the most-favored-nation tax rate. In addition, pay attention to the compliant deduction of import costs, keep all import documents and tax payment certificates, to ensure that the input tax can be deducted normally when declaring VAT, and avoid increasing the comprehensive cost due to incomplete certificates. If cross-border related transactions are involved, ensure that the pricing complies with the arm's length principle, so as to avoid triggering transfer pricing investigation by tax authorities.

Victor Sun
Victor SunYears of service:5Customer Rating:5.0

Trade Risk Control ManagerStart a Chat

The collection and payment of foreign exchange for agency imported sanitary napkins shall strictly follow the compliance requirements for cross-border payment. If RMB settlement is adopted, it can be handled through the CIPS system to shorten the account arrival time and reduce exchange rate risks; if foreign currency settlement is adopted, lock the foreign exchange purchase rate in advance to avoid cost increase caused by exchange rate fluctuations.

When collecting and paying foreign exchange, clearly mark "sanitary napkin import payment" in the declaration remarks, and keep relevant trade contracts, invoices and customs declaration forms as collection and payment vouchers, to ensure that the capital flow is consistent with the cargo flow and document flow, and avoid being listed as a key monitoring object by the foreign exchange administration. If advance payment is involved, register in the trade credit system of the foreign exchange administration in advance to ensure that the advance payment amount does not exceed 30% of the contract amount, so as to avoid being unable to pay foreign exchange due to failure to register. At the same time, avoid irregular fund transfer through offshore accounts to ensure the compliance of the whole process of foreign exchange collection and payment.

Kevin Lin
Kevin LinYears of service:4Customer Rating:5.0

Trade Solutions ManagerStart a Chat

The cooperation agreement for agency imported sanitary napkins shall clarify the rights and obligations of all parties, especially the cargo right transfer clause. It shall be agreed that the cargo right will be officially transferred to the domestic purchaser after the goods complete customs clearance and obtain the inspection and quarantine certificate, so as to avoid legal disputes caused by cargo right disputes.

At the same time, force majeure clauses shall be added to the agreement to clarify the division of liability for delays caused by force majeure such as epidemics and port strikes, so as to avoid unilateral bearing of losses caused by force majeure. In addition, verify the intellectual property rights of overseas brands to ensure that the imported sanitary napkins do not infringe the trademark rights or patent rights of third parties.

If necessary, require overseas manufacturers to issue intellectual property authorization certificates and handle intellectual property protection filing at the customs to avoid the goods being detained due to infringement. If L/C settlement is involved, strictly review the L/C clauses to avoid soft clauses, such as "the inspection report approved by the buyer is required", which leads to the inability to receive foreign exchange normally.

Michael Zhang
Michael ZhangYears of service:6Customer Rating:5.0

Customs Declaration & Compliance ExpertStart a Chat

When agency imported sanitary napkins are inspected by the customs, prepare the full set of documents and filing certificates in advance, and cooperate with the customs personnel to complete the unpacking inspection to ensure that the brand, model and ingredients of the goods are consistent with the documents. If the machine inspection is abnormal and manual inspection is required, explain the material characteristics of the product to the customs in advance to avoid cargo damage caused by improper unpacking operation.

If the customs requires sampling inspection, cooperate with the inspection and ensure the representativeness of the samples submitted for inspection, so as to avoid the whole batch of goods being returned due to unqualified samples. At the same time, pay attention to the packaging label of the goods to ensure that the Chinese label complies with the requirements of GB 7718-2011 *General Rules for Labels of Prepackaged Foods* (applicable to daily chemical products for reference).

If the label is unqualified, complete the rectification within the specified time limit to avoid the goods being unable to pass customs due to label problems. In addition, keep photos and records of the inspection process for subsequent dispute handling.

Lucas Liu
Lucas LiuYears of service:8Customer Rating:5.0

Senior Operations ConsultantStart a Chat

The supply chain planning for agency imported sanitary napkins shall be combined with the sales data of the domestic market, and the import batches and quantities shall be reasonably arranged to avoid capital occupation caused by overstock. It is recommended to adopt the import mode of "small batch and multiple batches" to reduce inventory risks, and at the same time agree on a flexible delivery date with overseas manufacturers to ensure that the import volume can be adjusted according to market demand.

In addition, optimize the domestic warehousing layout, and choose bonded warehouses or ordinary warehouses close to the main sales areas to shorten the distribution time limit and reduce logistics costs. At the same time, establish an inventory linkage mechanism to connect the import customs clearance time limit with the domestic inventory early warning system, so as to ensure that the next batch of imports can be arranged in time when the inventory is insufficient, to avoid out of stock. In addition, regularly analyze the import cost and sales data, optimize the procurement pricing strategy, and improve the overall profit margin.

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