International Payment Solutions Q&A

A company plans to use an agency for export and has questions about payment receipt. They inquire whether the consignor or the agent is the entity that receives payment in agency export transactions, which method is more common, and their respective pros and cons. The best answer indicates that there are two scenarios for the payment recipient: the agent or the consignor. Agent receives payment is common and simpler to operate, but the consignor may worry about fund security. Consignor directly receives payment has requirements for their own qualifications and capabilities, but offers higher fund control. The specific choice needs to comprehensively consider various factors.

The company has agency export business, and originally the principal was responsible for collecting foreign exchange. Due to the troublesome process for the principal to collect foreign exchange, the company wants to know if it can collect foreign exchange itself and the precautions. The best answer points out that generally, one can collect foreign exchange oneself, but it must be clearly stated in the agreement with the principal, possess the relevant qualifications, declare and handle finances according to foreign exchange administration regulations, and improper operations may face penalties.

The company plans to develop agency export business and is debating whether it is better for the entrusting party to collect payment or for the entrusted party (agent) to collect payment. The best answer indicates that the entrusted party collecting payment has a relative advantage, possessing professional foreign trade payment collection experience and risk control mechanisms, enabling them to skillfully handle international settlement issues and conveniently manage tax refund matters. Although the entrusting party collecting payment has direct control, they might face payment collection and tax refund risks.

A company is facing remittance collection issues when using a freight forwarder agent for export and is inquiring about specific methods, processes, and precautions for freight forwarder agent export remittance collection. The best answer suggests that remittance collection can be done through the company's own foreign exchange account or by the freight forwarder collecting on behalf of the company. During operations, it is important to ensure accurate customs declaration information, communicate promptly about cargo transportation, and pay attention to foreign exchange policies in different regions to avoid remittance risks.

The company intends to engage in agency export business and has doubts about who collects and pays in agency export. It wants to understand whether the agent or the principal collects and pays in actual operations. The best answer states that agency export usually follows this principle, with the agent generally collecting payments, deducting fees, and then remitting to the principal. Payments depend on procurement situations; if the agent procures, the agent pays, and if the principal procures, the principal pays.

A company entrusted an agency to export goods and previously handled remittances themselves, leading to a lack of clarity on the remittance process and requirements for agency exports. The best answer points out that the entrusting party and the agent need to sign an agreement. After the agent receives the foreign exchange, they will remit it to the entrusting party according to the agreement. For remittances, basic documents such as contracts and invoices need to be prepared. If tax refunds are involved, tax refund documents are also required. Attention should be paid to compliance and special requirements for different situations.

A company plans to use agency export services and has questions about receiving payments. They are inquiring about who the recipient of the payment is in agency export, as well as related risks and precautions. The best answer points out that there are generally two situations: the agent receives the payment, or the consignor receives the payment, with the former being more common for better control and risk prevention. If the consignor receives payment, they must have the necessary capabilities and qualifications. Regardless of the method, key terms must be clearly defined in the agreement, and relevant risks should be noted.

A company plans to act as an agent for exporting goods and is unfamiliar with payment methods. They are inquiring about how to collect payments in agency export, what methods are available, and which is more reliable. The best answer introduces common payment methods such as telegraphic transfer (T/T, both advance and usance), letters of credit (L/C), and documentary collections (D/P and D/A), and indicates that advance T/T is the most reliable, while also explaining that the specific choice needs to consider various factors comprehensively.

When cooperating with an import and export agency company, after customs clearance, they have not paid for more than half a month. Every communication is evaded with various excuses. The best answer suggests calmly collecting relevant evidence such as cooperation contracts and communication records, trying to communicate seriously with the company's senior management. If unsuccessful, you can complain to the industry association, and finally, you can file a lawsuit to demand payment and responsibility from the other party.

Our company handles agency export business and has received an advance payment, but we are unsure how to process it. We want to understand the financial and tax treatment, as well as how to coordinate with the principal party. The best answer indicates that financially, it should be recorded under "Advance Receipts" with detailed records; tax-wise, advance payments generally do not incur VAT temporarily but require reporting, and tax will be declared when revenue is confirmed upon completion of the export. Timely communication with the principal party regarding fund arrival and arrangement of fund usage according to requirements and contract stipulations.