The customs credit rating, also known as the customs credit level, is an evaluation given by customs authorities based on the credit status of an enterprise. Enterprises are categorized into certified enterprises, general credit enterprises, and dishonest enterprises. Certified enterprises are further divided into Advanced Certified Enterprises (AEO) and General Certified Enterprises.
Factors Affecting Customs Credit Rating
1. Compliance with Customs Regulations
- Honest Declaration and Timely Tax Payments: Regular adherence to customs supervision rules and timely payments.
- Adherence to Customs Supervision Rules: Following all regulations and guidelines set by customs authorities.
2. Violations
- Smuggling and Tax Evasion: Engaging in illegal activities such as smuggling or tax evasion.
- False Declarations: Providing inaccurate information in customs declarations.
3. Internal Management
- Robust Internal Control Systems: Having a strong internal control system and sound financial status.
- Proper Internal Governance: Ensuring adherence to legal requirements within the company.
4. External Credit Records
- National Dishonesty Lists: Inclusion in lists of dishonest enterprises.
- Compliance with External Credit Standards: Meeting industry regulations and maintaining good credit records.
Customs Management Measures for Different Enterprise Ratings
Certified Enterprises
- Incentives and Facilitation: Enjoy reduced inspection rates and streamlined procedures.
- Priority Processing: Benefit from priority in customs procedures.
General Credit Enterprises
- Standard Management: Subject to regular customs procedures and moderate inspection rates.
Dishonest Enterprises
- Restrictive Measures: Face higher inspection rates and stringent customs controls.
- Punitive Actions: Subject to more rigorous audits and penalties.
Impact of Low Customs Credit Rating
A low customs credit rating increases the likelihood of customs inspections. Customs may flag shipments or behaviors based on previous violations, leading to more frequent inspections and potential delays.
How to Improve Customs Credit Rating?
1. Establish a Scientific Credit Management System
- Professional Credit Management: Implement a professional system and employ dedicated personnel to manage credit risks.
2. Sign Formal Contracts
- Clear Agreements: Ensure contracts clearly define rights and obligations to prevent disputes.
3. Use Credit Insurance
- Export Credit Insurance: Purchase insurance to protect against customer defaults.
4. Diversify Markets
- Market Expansion: Avoid over-reliance on a single market by expanding to multiple countries and regions.
5. Track Payments Promptly
- Financial Monitoring: Have a dedicated team to monitor payments and address issues promptly.
6. Maintain Good Relationships
- Customer Relations: Build strong relationships with customers and offer excellent after-sales service.
7. Utilize Professional Help
- Third-Party Assistance: Seek help from professional service providers if resources and expertise are lacking.
Consequences of Being Rated as a Dishonest Enterprise
1. Import/Export Quota Restrictions
- Limited Access: Restricted access to certain import/export quotas.
2. Foreign Exchange Limitations
- Reduced Quotas: Restrictions on foreign exchange management.
3. Enhanced Audits and Inspections
- Rigorous Checks: More thorough audits and inspections from customs and other regulatory bodies.
4. Restrictive Management Measures
- Benefit Ineligibility: Ineligibility for certain benefits like government procurement participation.
5. Blacklisting
- Market Reputation: Being blacklisted can severely impact market reputation and business opportunities.