Changes to China's customs legislation will lead to more stringent clearance procedures.
These changes shouldn’t prohibit companies from trading but businesses need to be aware of the changes or risk getting caught out.
For reference DHL has provided an overview below of the main changes and how they affect your business but we’d recommend companies refer to DHL’s China Customs guide for a full summary of the regulations for exporting shipments to China.
1. Harmonised System Codes (“HS Codes”)
All shipments now require a Harmonised System Code to be included on the Customs declaration forms. HS codes are the internationally standardised system of numbers for classifying traded products developed and maintained by the World Customs Organisation.
DHL Express has a Trade Automation website which you can use to find the relevant HS code.
HM Revenue and Customs also provide advice on classification issues, including help with difficult to classify products and a telephone helpdesk.
2. Change to Deminimis Status
Previously the deminimis value was based on the declared value of the goods. However this is now assessed on whether the duty is less than CNY 50.00 (approximately £4.50). Duty will vary depending on the nature of the item.
3. Importer and Exporter Registration Codes (“CR Code”)
All importers and exporters in China are required to register with Customs authorities for a Registration Code or IOR/EOR (Importer/Exporter of Record).
The CR Code must now be indicated on the Customers declaration forms for all shipments, except for documents and personal effects.
How can DHL Express help me?
DHL has been operating in China since 1986 in a 50/50 joint venture agreement with Sinotrans (China National Foreign Trade Transportation (Group) Corporation) – a large Chinese transport corporation with interests and activities stretching across all transport modes, including sea, air and ground.
Being the first international express company to enter China, DHL has extensive experience and a deep knowledge of this market. Over the last 24 years, DHL-Sinotrans has been recognised as the market leader and a pioneer in the Express and Logistics industry in China.
We have a market share of over 30%. The company currently has close to 6,000 employees, more than 1,680 courier vehicles, 178 physical facilities and our presence extends to more than 401 Chinese cities.
In October a new flight from DHL’s East Midlands to China was introduced. Operated by Aerologic on behalf of DHL, the four times a week overnight service ships goods to Shanghai in less than seventeen hours.
Why trade with China?
China is one of the largest countries in the world and offers enormous possibilities for UK businesses looking for a new trading partner.
The country has a population of more than 1.3 billion people and the second largest economy in the world. In early 2009, the UK and China took steps to strengthen business ties, building on the rapid growth in bilateral trade which saw UK exports to China rise by almost a third.
China’s economy grew 8.7 per cent in 2009, the best performance of all major economies. While the rise of China is easy to acknowledge, businesses constantly need to catch up with the speed and depth of change and development in China’s large and complex market space.
The UK's exports to China increased by 40% in the first six months of the year, according to the UK government, although admittedly from a very low base, less than 2.5% of all UK exports. Yet China is the second largest trading nation in the world and the largest exporter and second largest importer of goods.
China offers fantastic potential for UK companies but at the moment Brits are not capitalising enough on opportunities available. For smaller companies, deciding to trade in China can seem overwhelming, especially as the import/export regulations have recently tightened up.
For companies without experience in trading with China, there is confusion around the protocols and SMEs may be put off by the complexities of getting started.
How do I get started trading?
As China is more than 5,000 miles from the UK, it's essential to get your transport and logistics right. The process of exporting to China has a lot of steps, each of which has its own complexities so it is important to be well informed about the correct procedures.
For businesses new to importing from this market, the required steps to export to China can seem baffling. But there are real business benefits to learning how to import - building import knowledge and expertise gives you access to a broader range of products at a broader range of prices than your competitors, giving you more competitive product options. If you're new to importing, start slowly with the intent to learn the process. Consider placing a small order and go through the process of working with the supplier, logistics service provider and getting the product shipped. With knowledge and experience of the importing process, you will find the process much easier.
DHL Express recommends visiting Business Link's guide to trading with China, UK Trade and Investment's guide and the European Commission's website.
What documentation do I need to provide in order to export goods to China?
For all dutiable shipments, an invoice (provided by the shipper) will be required. This must include:
• Number and date of issue
• Full name and address of shipper and receiver, including contact details
• Description of goods in plain language and sufficient detail
• VAT numbers for shipper and receiver if applicable
• Harmonized System Code (“HS Code”)
• Customs Registration Code (“CR Code”)
• Total value of goods
• Currency
• Country of origin (of goods)
• Payment terms (value for customs)
• Delivery terms
• Signed and stamped if applicable
Please note that there are several commodities which require further shipping requirements – including alcoholic beverages, foodstuffs, and computer components. Please review DHL’s China Customs Guide for further details.
