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Barter trade refers to the direct combination of export goods and imported goods of equivalent value based on exchange.
On December 22, 2023, Executive Order 14114 of America expanded the sanctions powers against foreign financial institutions. As a result, some Chinese banks are now particularly strict in their self-censorship, vetting payments from Russia left and right. Ningbo Chouzhou Bank was directly sanctioned by SWIFT, scaring other Chinese banks silly.
Our company makes industrial customized equipment and some spare parts and instruments, so we are afraid to sign contracts now, for fear of problems with RMB collection. During the Chinese New Year, the Russian contract will come. When we consulted ICBC, the bank said that the RMB payment for this order might be rejected. ICBC people came to the house to explain the policy. After all, even they were not sure whether they could settle foreign exchange normally. I am deeply sorry. As long as it is industrial products and mechanical parts, there are risks, and the risk control department of the head office may refuse. Last year, it was basically a month's review time, and now we directly suggest that we change banks, and they reject it with a high probability.
Do you have other ways to collect foreign exchange (Russian RMB)? Our main customer is in Russia, we have been cooperating since before the war, and now we can't receive the payment, will the company close down? Asking for advice.
What is barter trade?
Barter trade refers to the direct combination of export goods and imported goods of equivalent value on the basis of exchange.
In the traditional barter trade, the buyer and seller generally exchange goods of equal value, does not involve the payment of money, and there is no third party involved, and the barter parties sign a contract including the exchange of goods to compensate each other, and the relevant matters are determined. In international trade, barter is more commonly used in the form of reciprocal letter of credit.
Barter trade declaration case
Domestic company A imports wood from overseas Company B, and the two parties agree that Company A exports rice to Company B in order to repay the timber payment of Company B. After the transaction is completed, Company A receives the rice payment paid by Company B in excess of its timber payment. How should the income be declared?
Analysis and Conclusion:
Barter trade refers to the direct exchange of export goods for import goods without monetary medium, and the customs supervision method is "0130 barter trade". Income/expenditure on price differences between export and import goods in barter trade should be reported under "121990 Trade in Goods - Trade in goods included in Customs statistics - Trade in Goods included in Other Customs Statistics", and the transaction notes indicate: Income from price differences in barter trade.
The Ministry of Commerce issued a list of key tasks in the pilot free trade Zone to explore and improve the management of new barter trade
To implement the decision-making and deployment of the Party Central Committee and The State Council, take the 10th anniversary of the construction of the pilot Free Trade Zone as an opportunity to accelerate the implementation of the upgrade strategy of the pilot free trade Zone and promote high-quality development, recently, the Ministry of Commerce, together with relevant localities and departments, formulated the "Key work List of the Pilot Free Trade Zone (2023-2025)" (hereinafter referred to as the "Work List"). The relevant pilot free trade zones plan to independently promote the implementation of 164 key tasks from 2023 to 2025, with 7-10 key tasks for each pilot free trade zone, including major institutional innovation, key development industries, important platform construction and major project activities.
In the list of key work of the Shandong Pilot Free Trade Zone and Anhui Pilot Free Trade Zone, it is proposed to explore and improve the new barter trade management. In the list of key tasks of the Guangxi Pilot Free Trade Zone, it is proposed to "promote the landing processing of imported goods in the border peoples' mutual trade." In the list of key work of Yunnan Free Trade Pilot Zone, it is proposed to "promote the processing of tropical fruits, nuts, agricultural products and other commodities in the border market, build the processing industrial park in the border market, and build the processing center in the border market for ASEAN (Honghe Area)". In the list of key tasks of the Heilongjiang Pilot Free Trade Zone, it is proposed to "promote the cross-border trade of Chinese herbal medicine landing processing industry (Heihe Area)", "promote Sino-Russian characteristic industrial cooperation, and innovate trade supervision methods, service functions and trading modes (Suifenhe Area)". In the list of key tasks of Hunan Pilot Free Trade Zone, it is proposed to explore the mode of settlement of trade in non-local currencies.
The "Work List" will play a role in the following three aspects: First, strengthen classification guidance. The "Work List" is based on the strategic positioning and development goals given to the respective pilot trade zones by the central government, and sets out their respective construction directions and priorities in the next three years in the form of a list, so as to promote accurate positioning and accurate policies across the region to achieve differentiated and personalized development. Second, we will promote reform and innovation. The "Work list" covers a series of key tasks actively planned and independently promoted by the respective pilot trade zones, which is conducive to giving full play to the local initiative, mobilize the enthusiasm and initiative of local reform, and constantly deepen reform practice and innovation in light of local conditions. Third, strengthen system integration. The "Work List" gives their respective pilot trade zones integrated goals and tasks, and all localities can continuously improve supporting policies in the implementation process, strengthen the integration of major institutional innovation systems, collaboration and efficiency, and form more replicable and scalable institutional innovation results.
The current Sino-Russian trade, situation is pressing, barter trade can solve the problem of Russian trade collection? If you have a good Russian client, you might want to discuss this with him. Click to read the original article, there are more collection cases of barter trade.
In addition, the collection of Sino-Russian trade in non-industrial goods may not be affected
Another way to collect money on behalf of a third-party logistics company between China and Russia can be considered. There are some such logistics companies in Fubu.
