Exporting to China: Market Entry, Product Rules, Duties and Partners

A foreign seller reaches Chinese customers through a Chinese importer and distributor, through its own company in China, or through cross-border e-commerce. The distributor route is the fastest and the cheapest: a licensed importer clears the goods, holds the product registrations where needed, and sells on; the foreign seller gives up margin, customer contact and control of pricing and brand. An own company — usually a wholly foreign-owned enterprise (WFOE) with an import-export licence — keeps all of that but takes a year and real cost to set up, and requires registered capital, a Chinese legal representative, an office and accounting under Chinese rules. Cross-border e-commerce lets consumer goods be sold to Chinese individuals from bonded warehouses or by direct mail under a lighter regime, within value limits and for goods on a positive list.

Which route fits depends on the product's regulatory burden and the seller's ambition. Machinery and industrial inputs go through distributors and direct sales to factories; branded consumer goods often start in cross-border e-commerce to test demand and move to general trade with a distributor once volumes justify registration.

China has its own national standards (GB standards, mandatory ones marked GB, recommended ones GB/T) and its own conformity marks. The China Compulsory Certification (CCC or 3C) mark is mandatory for listed categories including most electrical and electronic equipment, automotive parts, toys, fire products and some building materials; it requires testing in an accredited Chinese laboratory and a factory inspection, and takes months. Goods outside the CCC catalogue may still need to meet GB standards and carry Chinese-language labelling — product name, ingredients or materials, origin, importer name and address, and warnings — before they can be sold.

Some categories go further: cosmetics need registration or notification with the National Medical Products Administration; infant formula, health foods and new food ingredients need registration; medical devices are classified and registered with the NMPA; foreign food producers of many categories must be registered with the General Administration of Customs under the overseas manufacturer registration regime introduced in 2022. Each of these is a project in its own right and the reason the distributor route exists.

Import duty is assessed by 13-digit tariff line (the first six digits follow the international HS nomenclature) at the most-favoured-nation rate, a conventional rate where a free-trade agreement applies and a certificate of origin is presented, or a general rate for countries without MFN status. Rates run from zero on many machinery and raw-material lines to double digits on consumer goods and agricultural products. Import VAT of 13 % (9 % for a reduced list) is charged on the duty-inclusive customs value, and consumption tax applies on top to a short list of goods — alcohol, tobacco, cosmetics, jewellery, cars and fuel.

Customs valuation follows the transaction value plus the cost of transport and insurance to the Chinese port; related-party prices and royalties attract scrutiny. Importers with Authorised Economic Operator status clear faster and are inspected less; the status is held by the Chinese importer, which is one more argument for choosing a well-run distributor.

The General Administration of Customs absorbed the former inspection and quarantine agency (CIQ) in 2018, so declaration and inspection are a single process through China's Single Window. Food, agricultural products, cosmetics, medical devices and some industrial goods are subject to inspection; sampling, laboratory tests and certificate checks can add days or weeks at the port. Shelf-life rules matter for food: goods with less than a set share of their shelf life remaining are commonly refused by importers even where customs would accept them.

Distributors are found at sector fairs — the China International Import Expo in Shanghai each November is designed for exactly this, and sector shows such as CMEF for medical equipment, FHC and SIAL China for food, and the industrial shows in Shanghai serve specific industries — through chambers of commerce and export-promotion agencies, and through the same registries that buyers use to verify sellers (see the due-diligence guide). The contract should define territory, exclusivity and its conditions, minimum purchase, pricing and marketing obligations, ownership of the product registrations and trademarks, and a Chinese-law dispute mechanism, usually arbitration at CIETAC or the Shanghai International Arbitration Center.

A distributor that registers the foreign seller's products or trademarks in its own name controls the market; the seller should hold the registrations itself or through its own Chinese entity where the law allows.

Under the cross-border e-commerce retail import regime, goods on the positive list — cosmetics, food and supplements, apparel, small appliances and more — can be sold to Chinese consumers through platforms such as Tmall Global, JD Worldwide and Douyin's cross-border channel, shipped either from a bonded warehouse in a pilot zone (Hangzhou, Shanghai, Guangzhou, Zhengzhou and others) or by direct mail. Orders are limited to 5,000 yuan and 26,000 yuan per consumer per year, taxed at a reduced combined rate, and exempt from CCC and Chinese labelling for the individual consumer. Platform entry fees, marketing and logistics costs are significant, and the regime is for testing and brand-building rather than volume.

Chinese importers pay in US dollars, euros or renminbi through their bank, which checks the customs declaration against the payment under the State Administration of Foreign Exchange's trade-verification rules; delays usually mean missing documents rather than bad faith. A seller with its own Chinese company invoices in renminbi with a fapiao (official VAT invoice) and repatriates profit as dividends after audit and tax, or through service fees and royalties under transfer-pricing scrutiny — the payments guide covers the mechanics.