I.Agency export,Must profits be transferred through foreign exchange control channels?

According to the latest Cross-border Trade RMB Settlement Business Management Measures of 2024, agency export profit transfers must follow these principles:

• Applicability of Foreign Exchange ControlsDomestic agency companies receiving foreign exchange must complete export foreign exchange verification and cancellation
  • Cross-border RMB settlement can simplify the foreign exchange verification process
  • Foreign currency settlements must be processed through the bank's international balance of payments reporting system.
• Separate Account Management Requirements:
  • Agency service fees and export payments must be handled separately
  • Profit transfers require a complete chain of trade documents

II. What are the compliant paths for agency companies to transfer profits?

Based on the practical experience of serving 300+ foreign trade enterprises, three compliant transfer methods are recommended:

• Declaration Under Trade Items:
  • Clarify profit distribution ratios through supplementary trade agreements
  • Indicate the profit-sharing clause in the remarks column of the customs declaration form
• Service fee payment channel:
  • Sign the Comprehensive Foreign Trade Service Agreement to specify the service fee rate
  • Process service trade payments based on pro forma invoices
• Special cross-border RMB settlement channel:
  • Fund transfer via FTZ NRA account
  • Cross-border two-way RMB capital pool filing

III. What taxes and fees are required for profit transfers?

Illustrated with a case study of a manufacturing export enterprise (current tax rates for 2025):

• VAT treatment:
  • Pay 6% VAT on agency service fees
  • Export goods eligible for exemption, credit, and refund policy
• Withholding of corporate income tax:
  • Payments between domestic enterprises are not subject to withholding tax
  • Transboundary PaymentsRequired to withhold and remit at 10% tax rate
• Tax filing requirements:
  • Single payment over5$100,000 required for tax registration
  • Related-party transactions require preparation of transfer pricing documentation

IV. Which common operations may lead to fund freezes?

According to violation cases published by SAFE in 2024, high-risk behaviors include:

• Abnormal fund flows:
  • Service fees exceeding reasonable industry levels (generally 3-8%)
  • Significant deviation between payment/receipt timing and logistics documents
• Document management deficiencies:
  • Missing core documents such as customs declarations and shipping documents
  • Pro forma invoices not reflecting genuine transaction relationships
• Account usage violations:
  • Large fund transfers through personal accounts
  • Using third-party channels to transfer funds

V. How to establish a safe profit transfer mechanism?

Recommended three-tier risk control system:

• Top-level design phase:
  • Select agency companies with SAFE Class A qualification
  • Specify fund clearing terms in cooperation agreements
• Process control measures:
  • Establish electronic document management system (recommended retention for 10 years)
  • Monthly reconciliation of bank statements with business ledgers
• Post-event audit mechanism:
  • Annual third-party trade authenticity audit
  • Regular evaluation of cross-border capital pool usage efficiency