Exporting from China: what your factory handles and what you should check

Course outline

This course is free. Read any lesson below, or enrol to keep your progress in your Viaty account.

1. 1Who can export from China, and who actually does it12 min Read

   General information, not legal advice. Rules change; check the sources below before you act.

   When you order 5,000 printed tote bags, the company that makes them is not always the company that exports them. Knowing which is which matters for price, paperwork and your own compliance records.

   The legal starting point

   China's Foreign Trade Law sets the framework for importing and exporting goods. Until the end of 2022 it required foreign trade operators to file with the commerce authorities before trading. The Standing Committee of the National People's Congress removed that filing requirement in an amendment passed on 30 December 2022, and the State Council confirmed in January 2023 that businesses no longer need the filing to import or export.

   In practice this means:

   • A supplier who says they "have no export licence" is usually describing the old position, or means they are not registered with customs to make declarations.
   • What matters today is whether the exporter on the declaration is registered with China Customs to declare goods (or uses a customs broker), and whether it can issue the paperwork your order needs.

   Check the current position before you rely on this: the Foreign Trade Law has been amended several times and further revisions have been discussed.

   Three common set-ups

   1. The factory exports directly. It is registered with customs, appears as the shipper and exporter, and issues the commercial invoice. This gives the clearest paper trail.
   2. A trading company buys from the factory and exports. Common for small orders and mixed products (for example, pens from one factory and notebooks from another). The trading company is your contractual supplier; the factory may never see your name.
   3. An agent exports on the factory's behalf. The goods are declared under a third party's name. This can be legitimate, but it can also be used to avoid tax obligations. Ask plainly whose name will be on the export declaration.

   None of these is wrong in itself. The risk is not knowing which one you have. The name on the export documents, the name on your invoice and the name on the bank account you pay should tell one consistent story.

   What to check at step 3 (Check) and step 4 (Source)

   Every Chinese company has a business licence showing an 18-character Unified Social Credit Code, the registered name in Chinese, the legal representative, the registered capital and the business scope. Ask for a copy and compare it with the pro forma invoice.

   • Does the Chinese registered name match the English name on the quote? Translations vary, so ask for both.
   • Does the business scope cover manufacturing, or only trading? A trading company presenting itself as a factory is a common problem.
   • Is the bank account in the same company name? Never pay a personal account.
   • At which factory address will the goods actually be made? You need this for your product safety records in the UK or EU and for any inspection.

   Why this matters later

   As an importer in the UK or EU you are expected to know who made the product and to be able to trace it. If a trading company will not name the factory, you cannot meet those obligations with confidence, and an inspector booked at step 10 (Inspect) may be sent to the wrong site.

   Checklist

   • Business licence received and Unified Social Credit Code recorded
   • Manufacturer or trader confirmed, with the production address
   • Names on the quote, invoice, export documents and bank account consistent
   • Exporter on the declaration confirmed (factory, trading company or agent)
   • Subcontracted processes named (printing, embroidery, packing)
2. 2The export declaration and inspection by China Customs12 min Read

   Every commercial shipment leaving China is declared to the General Administration of Customs (GACC). The factory, its trading company or a customs broker lodges the declaration electronically, commonly through the China International Trade Single Window. As the buyer you do not file it, but what you tell the supplier ends up in it.

   What the declaration contains

   A Chinese export declaration records, among other things:

   • the exporter and the domestic producer or consignor
   • a Chinese commodity code (built on the international Harmonized System) and a plain description of the goods
   • quantity, units, packages, gross and net weight
   • the declared value and currency, and the trade term (for example FOB)
   • the destination country and the port of loading
   • the transport document reference once the goods are booked

   Keep the story consistent

   The value declared in China and the value you declare on import are separate declarations, made under different laws. Your import value is based on what you actually pay (see the landed cost course). Even so, if the Chinese invoice shows one price and your import entry another, customs on either side may ask why.

   Never ask a supplier to under-declare the value, or to describe the goods as something else to reach a lower duty. It is an offence in China, the UK and the EU, and the importer carries the duty debt if it is found.

   Statutory inspection

   Under China's law on the inspection of import and export commodities, goods listed in the catalogue of commodities subject to statutory inspection must be inspected by customs before export. GACC adjusts the catalogue by announcement, adding or removing lines. Separately, customs carries out random sampling of goods that are not on the catalogue.

   Most branded apparel, bags and drinkware are not usually on the export side of the catalogue, but do not assume it. Ask the factory or its forwarder to confirm, for the Chinese commodity code of your product, whether statutory export inspection applies and how long it adds. Check the current position before you rely on this: the catalogue changes.

   Documents the supplier prepares

   • Commercial invoice and packing list
   • The export declaration and customs release
   • A certificate of origin, where you or your customer ask for one
   • Booking confirmation, then the bill of lading or air waybill from the carrier or forwarder

   What the supplier needs from you

   • The agreed trade term and named place (for example FOB Ningbo)
   • Your forwarder's details if you are booking the freight
   • Shipping marks for the cartons
   • The importer's name and address if they must appear on products or packaging for the UK or EU (agree this at step 7, Approve, with the artwork)
   • Any labels, swing tags or inserts, approved before production

   Where this sits in the 13 steps

   Export paperwork is prepared during step 9 (Produce) and completed at step 11 (Ship). An inspection booked at step 10 (Inspect) should finish before the booking cut-off, or you risk missing the vessel.

   Checklist

   • Trade term and named port in the purchase order
   • Supplier has confirmed whether statutory export inspection applies
   • Invoice description is accurate and matches the goods
   • Declared value equals the price actually paid
   • Shipping marks and importer details supplied and approved
3. 3Export VAT rebates: why two quotes for the same product differ12 min Read

   Two Chinese suppliers can quote very different prices for the same mug, and neither is necessarily wrong. One of the biggest reasons is value added tax (VAT) and the export rebate.

   How it works

   China charges VAT on most goods sold domestically. The standard rate for most manufactured goods is 13%. Exports are zero-rated, and the exporter can recover VAT paid on its inputs through the export VAT rebate (in Chinese, 出口退税).

   The rebate rate is set per commodity code. For many goods it equals the full VAT rate; for others it is lower, and for some it is zero. The Ministry of Finance and the State Taxation Administration change rates by announcement. For example, rebates for photovoltaic products were cancelled from 1 April 2026 and battery rebates were cut, with cancellation announced from 2027. China's VAT Law took effect on 1 January 2026, replacing the earlier provisional regulations, and keeps the zero rate for exports.

   Check the current rebate rate for your product before you rely on any figure a supplier gives you.

   Why quotes differ

   • VAT-inclusive or not. A price in RMB may include VAT (含税) because the supplier normally sells domestically. The same supplier's export price in US dollars may be lower.
   • Who claims the rebate. Only the exporter on the declaration, holding the right VAT invoices (fapiao), can claim. A factory exporting in its own name can build the rebate into its price. A factory selling through a trading company may not.
   • Taxpayer status. Some small factories are not general VAT taxpayers and cannot pass on a rebate in the same way.
   • A shrinking rebate. If the rebate for your commodity code is cut, the supplier's cost rises even though nothing else changed.
   • Everything else: currency, trade term and port, payment terms, packaging, testing and sample costs.

   How to compare quotes fairly

   At step 5 (Quote), ask every supplier to price on the same basis:

   1. Currency, and whether the price includes Chinese VAT
   2. Trade term and named place (for example FOB Shenzhen, Incoterms 2020)
   3. Who will be the exporter on the declaration
   4. What is included: packaging, labels, polybags, cartons, testing, access for pre-shipment inspection
   5. Minimum order quantity, price breaks and how long the price is valid

   Red flags

   • The price only works if there is "no invoice", or the goods ship under someone else's name without explanation
   • Payment requested to a personal account or to a company that is not the seller
   • A price that moves sharply after the order because "the rebate changed", when the quote did not say it depended on the rebate

   Checklist

   • All quotes on the same currency, VAT and trade term basis
   • Exporter of record named in the quote
   • Quote validity and currency risk agreed
   • Any dependence on the rebate rate stated in writing
4. 4Certificates of origin, export controls and product quality10 min Read

   Three pieces of Chinese law and practice that merchandise buyers meet rarely, but should recognise when they do.

   Origin and certificates of origin

   Goods manufactured in China are of Chinese origin for customs purposes. A non-preferential certificate of origin can be issued in China by the China Council for the Promotion of International Trade (CCPIT) or by customs.

   • The UK and EU do not normally require a certificate of origin to import ordinary merchandise, but a customer, a bank under a letter of credit, or a trade remedy (such as the anti-dumping duty on some ceramic tableware from China) can make origin evidence important.
   • At the time of writing, goods of Chinese origin do not benefit from a general tariff preference in the UK (under its Developing Countries Trading Scheme) or the EU (under its Generalised Scheme of Preferences). Check the current position before you rely on this.
   • Never let a label, print or declaration state a different origin. False origin is a customs offence in China, the UK and the EU.

   Export controls

   China's Export Control Law took effect on 1 December 2020. It covers dual-use items, military items, nuclear items and other goods, technology and services linked to international obligations, with control lists, licences and end-use checks. Implementing rules for dual-use items followed.

   For T-shirts, bags, mugs and paper goods it is very unlikely to apply. It can become relevant for some electronic items or components with specialised functions. Know that it exists, and ask the supplier if a product has unusual technical features.

   Your logo and Chinese customs

   China Customs can act at export against goods that infringe intellectual property rights recorded with it. A factory printing a well-known mark without evidence of permission may see goods held. Give your supplier a signed brand authorisation letter for your logo and artwork, naming the products and the order, and file it with the approved artwork at step 7 (Approve).

   The Product Quality Law

   China's Product Quality Law (1993, amended since) makes producers and sellers responsible for the quality of products produced and sold in China, and prohibits false quality marks, forged origin and counterfeit certification marks. It is mainly a domestic law. It does not make your product legal in the UK or EU: your destination rules do that (see the UK and EU courses). Treat Chinese test reports as useful evidence only when they test against the requirement that applies where you sell.

   Where this sits in the 13 steps

   • Step 2 (Define): flag any product with electronics or unusual materials
   • Step 7 (Approve): brand authorisation letter filed with the approved artwork
   • Step 11 (Ship): certificate of origin ordered if a customer or bank requires it

   Checklist

   • Origin on labels, packaging and documents is the true origin
   • Certificate of origin requested only where needed, and from the right issuer
   • Brand authorisation letter issued for your logo
   • Electronics or unusual materials flagged for an export-control question
5. 5Labour standards: what the law says and what an audit shows12 min Read

   Buyers of branded merchandise are increasingly asked by their own customers how and where products were made. You cannot answer that from a price list.

   What Chinese law requires

   China's Labour Law (1994) and Labour Contract Law (2008), with national and local regulations, set the rules. In outline:

   • Working time: the Labour Law sets a maximum of eight hours a day and an average of no more than 44 hours a week; State Council rules since 1995 set a standard 40-hour week.
   • Overtime: normally no more than one hour a day, up to three hours a day in special circumstances, and no more than 36 hours a month. It must be paid at no less than 150% of normal wages, 200% on rest days where no time off in lieu is given, and 300% on public holidays.
   • Minimum wages are set by provinces and cities, and employers must pay social insurance contributions.
   • Written employment contracts are required.

   The reality you are managing

   Merchandise is seasonal. Conference kits, year-end gifts and Christmas orders land at the same time, and short lead times push factories towards excessive overtime or towards subcontracting printing, embroidery or packing to workshops you have never seen. Your lead time at step 5 (Quote) and your change requests after step 8 (Order) directly affect working hours at the factory.

   Social audits

   Common schemes include amfori BSCI, SMETA (run on the Sedex platform), SA8000 and WRAP. When a supplier offers an audit:

   • Ask for the full report, not a certificate or a logo.
   • Check the date, the site audited (the address should match production) and whether it was announced or semi-announced.
   • Read the findings and the corrective action plan, and ask what has been closed.
   • Check subcontractors: an audit of the sewing factory says nothing about the print workshop.

   An audit is a snapshot. It can miss problems, and on its own it is not evidence for a claim such as "ethically made".

   The rules at your end

   • In the UK, organisations above the Modern Slavery Act turnover threshold must publish an annual statement on the steps they have taken in their supply chains.
   • In the EU, the Forced Labour Regulation (EU) 2024/3015 prohibits products made with forced labour from being placed on the EU market, from 14 December 2027.

   The green and ethical claims course covers both in detail.

   Checklist

   • Realistic lead time agreed, including peak-season capacity
   • Full audit report received, dated and for the right site
   • Subcontracted processes named and approved at step 8 (Order)
   • Corrective actions from the last audit followed up
   • No "ethical" claim made on the strength of one audit
6. 6EXW, FOB and FCA at Chinese ports10 min Read

   Most Chinese factories quote FOB (Free On Board) at the port nearest to them: Shanghai, Ningbo, Shenzhen (Yantian or Shekou), Guangzhou (Nansha), Xiamen, Qingdao or Tianjin. The trade term decides who pays for and manages each step between the factory gate and the ship. The Incoterms course explains the rules in full; here is what they mean on the ground in China.

   EXW (Ex Works)

   Under EXW the seller only makes the goods available at its premises. The buyer is responsible for loading, export clearance and everything after.

   The problem in China: a foreign buyer is not usually in a position to make the Chinese export declaration. In practice the factory or a local agent does it anyway, so the paperwork does not match the contract. If you want the factory to do nothing beyond its gate, FCA is usually a better choice.

   FOB (Free On Board)

   The seller clears the goods for export and delivers them on board the vessel nominated by the buyer at the named port. The seller pays the origin costs: trucking to the port, export customs and origin terminal handling. Risk passes to the buyer when the goods are on board.

   FOB is designed for sea freight. Containers are usually handed to the carrier at a terminal or depot, and less-than-container loads (LCL) at a consolidation warehouse, so the goods leave the seller's control before they are on board. This is why ICC suggests FCA for container traffic.

   FCA (Free Carrier)

   The seller clears export and hands the goods to the buyer's carrier at a named place: the seller's premises (loaded) or another point, such as the forwarder's warehouse. Risk passes at that point. FCA works for any mode of transport, including air and courier.

   Who books the freight

   • Under EXW, FCA and FOB, the buyer's forwarder books the freight. You control schedules, rates and destination charges.
   • Under CFR or CIF, the seller books. It can look cheaper, but destination charges set by the seller's forwarder's agent can be high, and you pay them.

   Practical points

   • Booking cut-offs: goods and documents must reach the terminal days before sailing. A late inspection or late export clearance means a missed vessel.
   • Carrier requirements, such as declaring the verified gross mass of a container, apply before loading.
   • Name the exact place: "FOB Ningbo" is not the same as "FCA the factory, Yiwu".

   Where this sits in the 13 steps

   Agree the term at step 5 (Quote), write it into the purchase order at step 8 (Order) as, for example, "FCA [address], Incoterms 2020", and manage it at step 11 (Ship).

   Checklist

   • Term and exact named place in the quote and purchase order
   • Your forwarder introduced to the factory before goods are ready
   • Inspection date set before the booking cut-off
   • Origin charges clearly on the seller under FOB and FCA
7. 7References5 min Read

   General information, not legal advice. Rules change; check the sources below before you act.

   Primary sources for this course. Chinese laws are cited from official English translations; the Chinese text is authoritative.

   • Foreign Trade Law of the People's Republic of China (Ministry of Justice English text, as amended in 2022)
   • State Council: China lifts registration system for foreign trade authorisation (January 2023)
   • General Administration of Customs of the People's Republic of China (GACC), English site
   • China International Trade Single Window
   • State Taxation Administration of China, English site
   • SCIO: China to adjust or cancel export tax rebates for photovoltaic and battery products (January 2026)
   • China Council for the Promotion of International Trade (CCPIT), English site
   • Export Control Law of the People's Republic of China (NPC English text)
   • White paper: China's Export Controls (State Council Information Office, December 2021)
   • Law of the People's Republic of China on Product Quality (NPC English text)
   • Labour Law of the People's Republic of China (NPC English text)
   • amfori (amfori BSCI social audits)
   • Sedex (SMETA social audits)
   • Social Accountability International (SA8000)
   • ICC: Incoterms 2020

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