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My goods are stuck in China customs.

I have been exporting toys from China for 3 years. I currently have a 20′ and a 40′ allegedly being held by customs in China and our agent says they want a 13,000$ so called “fine” for them to come off the wharfs and on to a ship. I just refuse to pay. We have not really had many problems before. Any suggestions as what to do?  They say if I go over to China, the fine will increase. This is my Christmas stock but I am not paying any more fines. Thanks

ANSWER:

Thank you for contacting us with your situation below. Your email was forwarded to me as I have experience sourcing toys and dealing with Chinese export issues.

First I have a couple of questions to help understand the situation.

You mention you have been exporting for 3 years, do you mean 3 years with this supplier and this is the first time facing this problem? If it is a new order with a new supplier, then I am inclined to say you are getting smoke and mirrors and that the agent has probably screwed up the exportation.

What are the incoterms of your order? For example, if you purchased ExW then this mess at customs is technically your problem. If you are purchasing FOB HK for example, then legally the supplier should be sorting out this issue.

What are the payment terms of the order?  In other words, how much money has the supplier already been paid which is now held hostage?

Background

It is true that the customs authority in China is paying more attention to the quality of outbound products, especially toys.  The exporter on record should be licensed to export toys. For example, if a furniture factory decides to make plush toys, they may have years of export furniture experience, but that doesn’t mean they have the legal ability to export stuffed animals.

You mention your agent is asking you to pay the fine.  What is the fine for?  Which port BTW?

Sorry for all the questions, but the more I know, the more I can help.


Question answered by Mike Bellamy, an Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center. Mike is also the author of "The Essential Reference Guide to China Sourcing" and founder of PassageMaker Sourcing Solutions.

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