Can the Agent Serve as a Legal Payment Subject in Import Agency Business?
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I am a foreign trade specialist at a domestic trading company. Last month, I took charge of a batch of precision instruments imported from Germany and entrusted a cooperating freight forwarder to act as the import agent. Now we have reached the payment stage. The agent said we, the entrusting party, should make the payment directly.
But I remember hearing about the "Who Imports, Who Pays" rule before, yet the agent claims they can make the payment on our behalf. I'm confused about who should actually make the payment. Moreover, the contract we signed with the German supplier was with the agent, not directly with our company.
If we make the payment ourselves, will there be a mismatch between the contract subject and the payment subject? I'm also worried that non-compliant payment may affect subsequent customs declaration and tax refund. Is there any way to clarify these rights and responsibilities to ensure we don't cross compliance red lines?
JohnYears of service：6Customer Rating：5.0
Export Tax Rebate AdvisorStart a Chat
The 2026 newly revised Measures for the Administration of Cross-border RMB Receipts and Payments by the State Administration of Foreign Exchange clearly stipulates that the payment subject of import business must be consistent with the actual consignee of the imported goods (i.e。the entrusting party). The agent may only provide services for handling foreign exchange purchase and payment，and shall not act as the payment subject without authorization. In light of your situation，first you need to sort out two core documents: the procurement contract with the German supplier and the import agency agreement with the agent.
If your procurement contract was signed directly with the German supplier，your company is the actual import subject and must make the payment directly. The agent only needs to assist with foreign exchange purchase and transfer to the overseas supplier's account. If your procurement contract is in the "dual-header" mode signed with the agent，where the agent acts as the nominal consignee and your company is the actual consignee，your company still needs to be the payment subject. The agent shall clarify the rights and responsibilities of "handling payment on behalf" in the agency agreement to avoid a mismatch between the contract subject and the payment subject.
Regarding the compliance risks you are concerned about，three details need to be focused on: First，ensure the payee name on the payment voucher is exactly the same as that of the overseas supplier，second，the operating entity on the customs declaration form must match the payment subject，third，retain complete documents such as the agency agreement，procurement contract，and payment receipt for inspection by the foreign exchange bureau. If there is a mismatch between the contract subject and the payment subject，promptly sign a Letter of Confirmation for Entrusted Payment to clarify the agent's authority to handle payment on behalf，so as to avoid being identified as non-compliant payment.
In addition，the 2026 national customs clearance integration platform has realized automatic comparison of payment data and customs declaration data. If there is a subject mismatch，the system will automatically trigger an early warning，which may lead to account suspension or return of the customs declaration form. It is recommended that you submit the agency agreement and procurement contract to the agent's customs declaration specialist for pre-review 1-2 working days before making the payment to identify and resolve compliance risks in advance.
RobertYears of service：6Customer Rating：5.0
Warehouse Management AdvisorStart a Chat
Regarding the issue of payment subject in import agency business you mentioned, combined with the 2026 customs clearance practice at Shanghai Port, focus should be placed on the consistency between the "consignor/consignee" on the customs declaration form and the payment subject. If your company is the actual consignee, your company's name should be filled in the "consuming and using entity" field on the customs declaration form, and the payment subject must be consistent with the consuming and using entity.
If the agent acts as the "consignor/consignee" on the customs declaration form, it is necessary to note "Entrusted by XX Company (your company) to make payment" in the remarks column of the customs declaration form and upload the agency agreement to the customs system simultaneously. In addition, customs has incorporated payment data into the pre-clearance review link in 2026. If the payment subject is inconsistent with the consuming and using entity, the system will automatically push an early warning, and a compliance explanation must be submitted within 3 working days, otherwise it will affect cargo release.
In addition, if your company chooses to make payment via the CIPS RMB Cross-border Payment System, ensure the payee name in the payment instruction is exactly the same as that on the overseas supplier's invoice and contract to avoid remittance failure due to name mismatch. Some agents will open offshore accounts in their own names to collect payment.
In such cases, an Agreement on Transfer of Goods Title must be signed additionally to clarify that the actual ownership of the goods still belongs to your company, otherwise it may be identified as a transfer of goods title, leading to problems with subsequent tax refund. It is recommended that you submit all payment-related documents to the customs declaration specialist for pre-review before making the payment to ensure compliance with both customs and foreign exchange management requirements.
CharlotteYears of service：4Customer Rating：5.0
Currency Exchange AdvisorStart a Chat
In import agency business, the confirmation of payment subject will also affect the endorsement of the bill of lading and control of goods title. If your company is the payment subject, the consignee on the bill of lading should be filled in with your company's name or "To Order", and your company should endorse it to transfer to the agent for customs clearance.
If the agent is the payment subject, the consignee on the bill of lading should be filled in with the agent's name, and the goods title must be transferred to your company via endorsement later. However, according to the 2026 foreign exchange management requirements, if the consignee on the bill of lading is inconsistent with the payment subject, an agency agreement and proof of goods title transfer must be provided, otherwise the bank will refuse to handle the payment procedure.
In addition, some freight forwarders offer "freight collect" services, but it is necessary to confirm in advance whether the payment subject of freight collect complies with the "Who Imports, Who Pays" requirement. If the advance payment mode is selected, ensure the payment subject of the advance payment is consistent with the final payment subject to avoid disputes over goods title in the intermediate link. In 2026, the International Logistics Association updated the norms for bill of lading endorsement, requiring that all cross-border bill of lading endorsements clearly specify the time and subject of goods title transfer, otherwise it will affect the speed of customs clearance.
It is recommended that when signing the logistics agreement, clarify the consignee on the bill of lading, the endorsement method, and the responsible subject for payment, while retaining electronic and paper copies of all bills of lading for subsequent goods title verification and customs declaration. In addition, if transshipment is selected, confirm whether the freight forwarder at the transshipment port will arbitrarily change the consignee on the bill of lading to avoid loss of control over goods title.
DanielYears of service：8Customer Rating：5.0
Legal AdvisorStart a Chat
From the perspective of cross-border tax planning, the confirmation of payment subject will affect VAT deferral and withholding tax payment. If your company is the payment subject, you can directly apply for VAT deferral, delaying the payment of import VAT until the subsequent sales link to ease capital pressure.
If the agent is the payment subject, the applicant for VAT deferral must be the agent, and the VAT cost must be transferred to your company through related transactions later, which will increase additional tax costs and must comply with the related transaction pricing requirements of the BEPS Multilateral Convention.
In addition, with the implementation of the BEPS Multilateral Convention in 2026, the payment subject of cross-border related transactions must be consistent with the transaction subject. If the agent acts as the payment subject, it is necessary to submit a related transaction pricing report to the tax authority in advance, otherwise it will be identified as base erosion. Regarding the situation where your contract was signed with the agent, clarify the responsible subject for VAT in the agency agreement to avoid tax disputes.
In addition, if your company chooses to make payment via an offshore account, ensure the fund source of the offshore account complies with foreign exchange management requirements, otherwise it will be identified as illegal fund flow by the tax authority. It is recommended that before making the payment, consult a professional tax consultant to confirm the matching between the payment subject and tax planning to ensure compliance with international tax requirements.
EllaYears of service：10Customer Rating：5.0
Senior Financial AdvisorStart a Chat
Regarding the compliance requirements for cross-border payments and collections, the State Administration of Foreign Exchange launched the "Automatic Verification System for Payment Subjects" in 2026, which will automatically compare whether the subject in the payment instruction is consistent with that in the import contract and customs declaration form.
If there is a mismatch, the system will automatically intercept the payment instruction, and a compliance explanation must be submitted before handling. In addition, if your company entrusts the agent to make payment, sign a Letter of Authorization for Entrusted Payment before making the payment to clarify the agent's authority and scope of responsibility for handling payment on behalf, while retaining electronic and paper copies of the authorization letter.
In addition, some banks require the payment subject to provide documents such as the import contract, agency agreement, and customs declaration form to confirm the authenticity of the payment. If there is a mismatch between your company's contract subject and payment subject, an additional Letter of Entrusted Agency must be provided, otherwise the bank will refuse to handle the payment procedure.
In 2026, the CIPS RMB Cross-border Payment System has realized real-time connection with the system of the State Administration of Foreign Exchange, and payment data will be automatically uploaded to the foreign exchange bureau's system. If non-compliance occurs, it will be included in the enterprise's foreign exchange compliance file, affecting subsequent cross-border payment and collection business. It is recommended that before making the payment, confirm the document requirements for payment with your account-opening bank in advance to ensure all documents are complete and compliant.
AlexanderYears of service：10Customer Rating：5.0
Senior Trade AdvisorStart a Chat
From a legal perspective, the confirmation of payment subject must be clearly stipulated in the agency agreement to avoid subsequent contract disputes. If the payment subject is not clearly specified in the agency agreement, according to the 2026 Law on International Trade Agency, the payment liability shall be borne by the actual principal of the import business, i.e., your company.
If the agent arbitrarily makes payment in its own name, it shall bear the additional costs and compliance risks arising therefrom. In addition, if your company's contract with the German supplier was signed with the agent, clarify that your company is the "actual consignee" in the contract to avoid a mismatch between the contract subject and the goods title subject.
In addition, if a payment dispute occurs, retain all communication records, documents, and payment vouchers for subsequent legal proceedings. In 2026, the International Commercial Arbitration Commission updated the trial standards for cross-border trade disputes, requiring that the payment subject must be consistent with the contract subject, otherwise the contract will be identified as invalid.
It is recommended that when signing the agency agreement and procurement contract, consult a professional foreign trade legal advisor to clarify all rights and responsibility clauses to avoid subsequent legal risks.
SarahYears of service：3Customer Rating：5.0
Foreign Exchange AdvisorStart a Chat
In the on-site customs inspection link, the confirmation of payment subject will affect cargo inspection and release. If the payment subject is inconsistent with the consuming and using entity on the customs declaration form, customs inspectors will require the provision of the agency agreement and payment voucher to confirm the actual ownership of the goods.
If relevant documents cannot be provided, it may be identified as smuggling suspicion, leading to cargo detention. In addition, the digital system for on-site customs inspection in 2026 has realized connection with the system of the State Administration of Foreign Exchange, and inspectors can directly query payment data. If a subject mismatch is found, the enterprise will be directly required to submit a compliance explanation.
Regarding your situation, it is recommended that you submit all payment-related documents to the agent's on-site inspection specialist before the cargo arrives at the port, and communicate with customs inspectors in advance to ensure all documents are complete.
If problems occur during inspection, contact the customs declaration specialist and compliance specialist of the foreign exchange bureau in a timely manner to submit a compliance explanation to avoid cargo detention. In addition, if the machine inspection method is selected, ensure the cargo packaging is consistent with the declared information to avoid inspection delays due to packaging issues.