A company found an agency company to export products. The agency contract did not clarify the ownership of export refund taxes. The question is whether the tax should belong to the principal or the agent. The best answer points out that if there is no contract provision, it generally belongs to the principal because they are the owner of the goods and bear the costs. However, if the agent has advanced funds, they can negotiate the distribution. It is recommended that both parties communicate or consult professionals to determine the ownership.
How to Accurately Define Agency Export? Please Help Me!
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Our company intends to conduct agency export business, but we are not very clear about how to define agency export. Should it be judged from the business process or based on contract terms? Are there any clear standards to refer to? We hope you can explain in detail, so that we can accurately distinguish in actual operations and avoid some unnecessary risks and disputes.
Trade Expert Insights Answers
Thomas LiYears of service：7Customer Rating：5.0
Import Licensing AdvisorStart a Chat
Agency export refers to the principal and agent signing an agency export agreement. The agent (such as Zhongmaoda) is responsible for handling the procedures related to export business and collecting a certain agency fee, while the principal bears the profit or loss of the exported goods. From the perspective of business process definition, first, the principal needs to provide the goods, and the agent is responsible for handling export procedures such as booking, customs declaration, and inspection. In this process, the agent does not bear commercial risks such as product quality and market sales. From the perspective of contract terms, the contract should clarify the rights and obligations of both parties, such as the calculation and payment of the agency fee, and the ownership of the goods. In addition, in terms of financial settlement, the principal needs to declare tax rebates according to regulations, and the agent provides corresponding export documents. In summary, a comprehensive judgment from multiple aspects is required to accurately define agency export.
Richard WuYears of service：8Customer Rating：5.0
Global Trade Operations ExpertStart a Chat
You can look at the customs declaration form. The operating unit on the agency export customs declaration form is generally the agent, and the consignor is the principal. This is also an important basis for definition. If the situation shown on the customs declaration form conforms to this model, it is very likely to be an agency export.
David ChenYears of service：10Customer Rating：5.0
Trade Compliance AdvisorStart a Chat
The capital flow can also assist in the definition. In normal agency export, the principal pays the agency fee to the agent. Export foreign exchange receipts generally arrive at the agent's account first. After the agent deducts the agency fee, it is transferred to the principal. The flow and use of funds can be used to judge.
Olivia LiuYears of service：6Customer Rating：5.0
Foreign Exchange Risk ManagerStart a Chat
Look at the control of goods. In agency export, the agent generally does not have actual control over the goods. The goods are usually produced and stored by the principal, and the agent is mainly responsible for handling procedures in the export link.
Anthony LuoYears of service：10Customer Rating：5.0
Trade Compliance ExpertStart a Chat
From the perspective of tax rebate responsibility, agency export business is generally handled by the principal for tax rebates, and the agent assists in providing relevant materials. If there are problems with tax rebates, the responsible party is the principal, which is also a key point for judgment.
Linda GuoYears of service：3Customer Rating：5.0
Trade Dispute MediatorStart a Chat
Look at the business qualifications. The agent must have legal import and export business qualifications to carry out agency export business. If the agent does not have such qualifications, the definition of the business may be problematic.
Emma ZhaoYears of service：3Customer Rating：5.0
Export Documentation SpecialistStart a Chat
The contract name also has reference value. If the contract clearly states "Agency Export Contract" and the terms conform to the characteristics of agency export, it can be used as one of the bases for definition.
Michael ZhangYears of service：10Customer Rating：5.0
Customs Clearance SpecialistStart a Chat
Pay attention to the communication records between the two parties, such as emails and chat records. If they clearly indicate an agency export relationship, it can also be used as supplementary evidence for definition.
Robert TanYears of service：5Customer Rating：5.0
International Market Development AdvisorStart a Chat
Understand industry practices. The operating models and definition methods of similar businesses in the same industry can be used as a reference and can help determine whether the company's business falls under agency export.