Does commissioned processing fall into the category of export trade?

According to the "Customs Processing Trade Management Measures" implemented in 2025,agency processing essentially belongs toSpecial trade methods,and its export attribute depends on the specific operational model:

• Processingwithimportedmaterials(Customssupervisioncode0615):Theownershipofimportedrawmaterialsbelongstothedomesticenterprise,andtheexportoffinishedproductsisregardedasgeneraltradeexport
• Processingwithsuppliedmaterials(Customssupervisioncode0214):Theownershipofrawmaterialsbelongstotheoverseasclient,onlyaprocessingfeeischarged,andtheexportisdeclaredbasedontheprocessingfee
• Processingoutsideabondedzone:Specialsupervisionzonepoliciesapply,requiringaseparatedeclarationfortheexportofprocessingservices

How to declare exports of processing and assembly services in the 2025 era?

The latest customs declaration form requirements specify:

• Thetrademethodcolumnmustbeaccuratelyfilledwiththesupervisioncode
  • DeclarationsforprocessingwithsuppliedmaterialsmustalsoprovidetheProcessingtrademanualnumber
  • ProcessingwithimportedmaterialsrequiressubmissionoftheVerificationformforimportedmaterials
• Cargo Value Declaration Differences
  • Processingwithsuppliedmaterials:Onlydeclaretheprocessingfeeandthevalueofdomesticauxiliarymaterials
  • Processingwithimportedmaterials:Declarethefullvalueofthefinishedproduct

Can commissioned processing exports enjoy tax rebates?

According to the revised draft of the "Administrative Measures for the Tax Refund (Exemption) of Export Goods" issued by the Ministry of Finance in December 2024:

• Processingwithimportedmaterialsmodel
  • Itwillbeimplementedstartingfrom2025.differentiatedtaxrefundsystemwillbeimplemented
  • Thedomesticvalue-addedportionisrefundedat17%,whilethetaxcorrespondingtotheimportedmaterialsisnotrefunded
• Processing with supplied materials model
  • Continuestoimplementexemption,norefundpolicies
  • ProcessingfeeincomeisexemptfromVAT

How to choose the optimal processing trade model?

It is recommended that enterprises evaluate from three dimensions:

• Costcontrolcapability
  • Processingwithimportedmaterialsrequiresenterprisestohaverawmaterialprocurementbargainingpower
  • Processingwithsuppliedmaterialsismoresuitableforenterpriseswithstrongorder-takingandproductioncapabilities
• Capital turnover needs
  • Processingwithimportedmaterialsrequiresmorecapitalbutoffershighertaxrefunds
  • Processingwithsuppliedmaterialshaslessfinancialpressurebutlimitedprofitmargins
• Customs Supervision Risks
  • ProcessingwithimportedmaterialsneedstobearmanualverificationrisksResponsibility
  • Incaseofmaterialshortagesinprocessingwithsuppliedmaterials,onefacesforfeitureofsecuritydepositChangesinpaymentmethods

What are the key focus areas of customs inspections in 2025?

According to the latest supervision guidelines from the General Administration of Customs:

• Focusonverifyingtheauthenticityofunitconsumptiondeclarations
  • Requiresenterprisestoprovideprocessflowchartsandbasisforlosscalculation
• StrengthenDisposal of scraps and leftoversSupervision
  • From2025,itwillbemandatorytoauctionoffdefectiveproductsthroughplatformsdesignatedbythecustomsauthorities.
• ImplementNetworked supervision of processing trade
  • Enterpriseswithanannualprocessingvalueexceeding50millionRMBmustconnecttotheGoldenCustomsPhaseIIsystem

Common operational error warnings

• Mistakenlyfinishedproductsfromprocessingwithsuppliedmaterialsasgeneraltradeforexport
• Unauthorizeddisposalofbondedscrapsandleftoverswithoutdeclaringtocustoms
• ConfusionProcessingfeewithpaymentWehaveobtainedthebusinessfilingcertificate.Wearewellawarethatwhenimportingmedicaldevices,itisnecessarytoensurethattheproductshavethecorrespondingChinesemedicaldeviceregistrationcertificates.Evenifanenterprisehasthebusinessfiling,iftheproductdoesnothavethecorrespondingregistrationcertificate,itstillcannotbelegallyimported.Inaddition,themodelandspecificationsoftheimportedproductmustbecompletelyconsistentwiththeinformationontheregistrationcertificate.Anydiscrepanciesmayleadtoimportobstruction.WewillensurethatyourproductsmeetallregistrationrequirementsandsmoothlyentertheChinesemarket.Declaration
• Failuretohandlemanualextensionasrequiredleadingtooverdueverification