Export to China 101

There are two types of exporting process into China: the traditional exports and the cross-border e-commerce. The latter one is not just about logistics and customs declaration, but also a good way to integrate all the pieces of exporting to make it seamless. Typically, a qualified cross-border e-commerce provider owns or rents bonded warehouses in the free trade zones of China, where related Chinese regulatory entities also set up offices to centralize and expedite the customs declaration, and license/permit applications etc.. Since the products are shipped from the bonded warehouses in China, instead of from overseas, Chinese consumers receive the products in a much faster fashion and enjoy more convenient return processes. In addition, the overseas vendors of these products can enjoy the tax benefits, since goods kept in the bonded warehouses are not subject to tariff and enjoy a discounted value-added tax.

Traditional Exports vs. Cross-Border E-Commerce

Cross-Border E-Commerce

Traditional Exports

 


BUSINESS MODEL 

                                                                             

Traditional Exports

Cross-Border E-Commerce

Traditional Exports

Completely offline, for Business-to-Business (B2B) transactions only 



Cross-Border E-Commerce

Cross-Border E-Commerce

Cross-Border E-Commerce

1. Business-to-Business (B2B) transactions: all deals and customs clearance are made online, and the trades are recorded in the China customs database.

2. Business-to-Customer (B2C) transactions: 100% online, and the China customs do not collect B2C product information, as long as the transactions take place on a qualified cross-border e-commerce platform. 

Cross-Border E-Commerce

 PAPERWORK REQUIREMENT

Traditional exports to China require paperwork including but not limited to: certificate of origin, sanitary permits, inspection and quarantine certificates and import/export permits etc. A traditional exporter to China needs 2-3 months to get all the licenses and permits ready.

For cross-border e-commerce, only basic product information is required to report to the China customs database. The overall filing period is 7 business days

CUSTOM CLEARANCE PROCESS

Traditional exporters need to go through the China customs declaration with lengthy processing time and high costs.

For vendors using the cross-border e-commerce services, the products go through paperless customs filing.

PAYMENT SETTLEMENT PROCESS

Traditional exports: letter of credit, wire, banker's acceptance etc. 

Cross-border e-commerce: the sales proceeds collected in RMB are settled in USD through a licensed service provider. The State Administration of Foreign Exchange of China only issues the foreign currency settlement license to a limited amount of entities.