hillsidesIn the face of high tariffs in Europe and the United States, trade friction intensified, rising domestic costs, manufacturing bosses are looking for "curve to save the country" new path. Moving factories to Vietnam is one of the options, but the investment is large, long cycle? Today unveiled a more flexible, fast-acting strategy - theUse of Vietnamese companies for re-export trade! A number of manufacturing enterprises in Guangdong have tasted the sweetness, the cost of immediate reduction of 40%, orders unimpeded! This article will deeply analyze the core advantages, operational steps (including pit avoidance guide) and real cases, to help you seize the first opportunity!

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01.Three mountains of traditional foreign trade

1. High tariff barriers: Europe and the United States against Chinese products anti-dumping, countervailing duties at every turn 20%-200%, directly devouring profits.
2. Trade sanctions and restrictions: Specific products and enterprises are included in the "Entity List" and export channels are blocked.
3. Domestic consolidated costs continue to rise: Labor, land, environmental and compliance costs are under pressure.

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02.entrepot trade

New Ideas: Why Vietnam as a springboard?

Re-export trade, in shortGoods are not shipped directly from China to the final destination country, but are transshipped through a third country (Vietnam) for re-export with Vietnam as the country of origin. Utilizing Vietnamese companies has significant advantages: bypassing high tariffs and reducing costs!

✅Core strengths: Vietnam has Free Trade Agreements (FTAs) with many countries (especially the EU, UK, Japan, Korea, ASEAN, etc.). For example, the EU-Vietnam Free Trade Agreement (EVFTA) has reduced tariffs to 0% for most industrial goods.

Operational effects: Products (semi-finished or finished products) produced in China and subject to simple processing, packaging, labeling or transit in Vietnam that meets the requirements.Obtaining Vietnam Certificate of Origin (COO)We will export the products to Europe and the United States. Customers can enjoy very low or even zero tariff with Vietnam COO customs clearance! The cost savings can be up to 15%-40%+ (depending on the product and the original tax rate)!

✅Avoiding the risk of trade frictions and sanctions:

When products of Chinese origin are subject to country-specific restrictions or high punitive tariffs.Exporting as "Made in Vietnam" through re-export in Vietnam can effectively avoid the direct trade barriers against "Made in China".Secure order delivery and customer relationships.

✅Optimize supply chain layout and diversify risks:

Setting up a trading company or utilizing reliable partners in Vietnam is equivalent to establishing a flexible trading hub in Southeast Asia. Not only can it handle re-exports, but in the future it can also gradually take over some of the production, warehousing and distribution functions to diversify the supply chain and reduce the risk of a single region.

✅Capitalizing on Vietnam's comparative advantage:

Great location: With its proximity to China and easy access to land, sea and air transportation, logistics costs and time are relatively manageable.

Policy support: The Vietnamese government encourages exports and foreign investment, the trade environment is relatively open and the process of setting up a company is becoming more and more simplified.

Cost potential: Although costs in Vietnam are also rising, there is still room for cost advantages in logistics transit, simple processing, and compliance operations compared to Europe, the United States, and even some of China's coastal regions.

 If you have a company registration, bank account opening and other needs or other questions, welcome to sweep the code to add our online customer service (WeChat: jxhqcy890 / cell phone: 16625410105), to arrange for the manager to answer questions, to provide professional advice and full one-on-one service! 

03.How to use Vietnamese companies for re-export trade?

Core model:

China Supplier -> (Export) -> Vietnam Company (Compliance operation to get Vietnam COO) -> (Re-export) -> Final Destination CustomerDetailed steps and points:

1. Registering a Vietnamese company:

Registered Vietnam Limited Liability Company (LLC) and obtained import and export rights.Suitable for companies that have large business volumes, plan to operate for a long period of time, and require a high degree of controlThe company is a leading provider of services to the public, including registration, taxation and legal affairs. You can find us at Enterprise Caiying Group to assist with registration, finance and tax, and legal affairs.

Looking for reliable partners in Vietnam: cooperate with qualified and reputable Vietnamese trading companies. Suitable for the initial test of the water, medium business or do not want to build their own company. Choosing a partner is the most important thing! Be sure to conduct strict due diligence (qualification, reputation, operational experience, financial strength).

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2. Movement of goods and processing of documents:

China exports to Vietnam:

Export to Vietnamese companies in normal trade mode (general trade). Provide full set of Chinese export documents (invoice, packing list, bill of lading, etc.).

Key Points: The declared name and HS code need to match with the subsequent operation in Vietnam and the import requirements of the final destination country. Avoid sensitive words that cause concern.

Operation in Viet Nam (realization of "material change"):

Core requirements: According to the rules of origin of the FTA in the target market (e.g. "cumulation rule", "change of tariff classification", "specific processing" in EVFTA, "percentage of value added", etc.), the goods need to be processed or handled in Vietnam to meet the criteria of "Vietnam origin", "percentage of value added", etc.), the goods need to be processed or handled in Vietnam in order to fulfill the "Vietnam origin" criteria.This is the basis for legally obtaining a COO in Vietnam, and it is also the point of greatest risk!

Common Compliance Operations (subject to product-specific rules):

• Simple processing/assembly: e.g. replacement of packaging, re-labeling, simple sub-assembly, assembly of components (subject to value-added or tax code change requirements).
• Inspection, testing, quality control.
• Warehousing and trans-shipment (needs to be combined with other elements, single trans-shipment is usually insufficient).
• Strict records: Keep all records of operations in Vietnam (processing contracts, labor hour records, materials used lists, quality inspection reports, warehousing and logistics documents, payment vouchers, etc.) for verification at origin.

Vietnam for re-export to the final destination country:

• A Vietnamese company, as an exporter, applies for a Vietnamese Certificate of Origin (COO, e.g. EUR.1 form for EU) from the Ministry of Trade and Industry (MTI) or its authorized agencies.
• Provide Vietnam export documents (invoice, packing list, Vietnam export declaration, bill of lading, etc. issued in the name of Vietnam company).
• Send the Vietnam COO and other documents required for customs clearance to the customer in the final destination country.

Logistics arrangements:

Option A (land/sea transit): China -> Vietnam port/land port (clearance into Vietnam) -> operation in Vietnam -> Vietnam port -> final destination country. Flexible operation, but involves two clearances and longer time.

Option B (International Transit): The goods are loaded in China port, the destination port of bill of lading is Vietnam, but actually not unloaded in Vietnam port or unloaded into bonded zone/free trade zone for operation, and then changed to another ship (or the same ship) for transportation to the final destination country. The use of bonded zones can simplify customs clearance in Vietnam, higher efficiency, but high requirements for port facilities and operations. It is necessary to confirm with shipping company to support international transit bill of lading (Through B/L).

Money Flow and Taxes:

Funding Path: The end customer pays the Vietnamese company and the Vietnamese company pays the Chinese supplier. A compliant settlement path needs to be designed, taking into account foreign exchange controls and tax costs.

Tax Considerations:

Vietnam: Vietnam Corporate Income Tax (CIT), Value Added Tax (VAT), etc. are required to be paid. Need to understand Vietnam's tax incentives (e.g. export tax exemption/refund). Selecting bonded zone operation can defer or exempt part of Vietnam tax burden.

China: Normal payment of China export-related taxes and fees (if applicable).

 If you have a company registration, bank account opening and other needs or other questions, welcome to sweep the code to add our online customer service (WeChat: jxhqcy890 / cell phone: 16625410105), to arrange for the manager to answer questions, to provide professional advice and full one-on-one service! 

04.Our customer case sharing

I. Client background

A large building materials exporter, the main products are ceramic floor tiles, aluminum profiles, etc., the annual export value of nearly ten million. 2024 early encountered a new requirement from a Saudi customer:Customs declarations of non-Chinese origin must be provided, and it is expected that the subject of the declaration is not a Chinese company.

The client wanted to complete export compliance optimization without disrupting the current supply chain, and was considering shifting a portion of its profits overseas to facilitate the sourcing of raw materials.

II. Customer Core Claims

1. Avoid the "Made in China" label and obtain a certificate of origin from a third country.

2. Realize that the main body of the export trade declaration is not a Chinese company, to ensure smooth customs clearance

3、Can collect UAE customers' payments and complete formal invoicing

4、Profits can be deposited in offshore accounts for overseas purchasing or brand operation investment

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weOffers a portfolio of solutions:

1、Registered Hong Kong company: open a collection account + receive payments from customers + issue commercial invoices

2、Register Vietnamese company or docking OEM party, apply for certificate of origin + export customs declaration (CO, Form E, etc.)

3、Registered Dubai company (optional): used to complete the final customs clearance or accept payment for goods from customers in the United Arab Emirates

4, Supporting trademark registration (Hong Kong + UAE) + export certification support (such as SASO)

5、Provide one-stop re-export customs declaration supporting: customs clearance path + logistics docking + invoice compliance audit
FAQ:

1、Customer requires certificate of origin + customs declaration, must I register Vietnam company?

Not necessarily, you can docking local traders or processing plants on behalf of the issuance of certificates of origin, you can also register your own company is more secure.

2. Is there any restriction for funds to go into Hong Kong accounts?

We support the opening of offshore accounts and multi-currency receipts, receive payments from the Middle East, and are transparent and compliant with annual audits and reporting.

3. Will customers check the holding structure? Will the use of Hong Kong be recognized?

No check, as long as the front-end contract/invoice is issued by an overseas company, the customer cannot trace back to the holding company behind it.

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A guide to avoiding the pit:

01. Compliance First

Do not make false declarations or misrepresentations. "Substantial change" is the core, must strictly meet the rules of origin of the target market. Otherwise, you will face high fines, confiscation of goods, loss of credit and even legal risks.

02. Choosing a reliable partner

Whether you're a self-builder or a partner, having a reliable, professional and knowledgeable team or partner on the ground is the key to success. Be wary of skinflints and scammers.

03. Eat the rules

In-depth study of specific terms of FTAs between target markets (e.g. EU, US) and Vietnam, especially Product Specific Rules of Origin (PSR).

04. Consistency of documents

All documentary information (name, specification, quantity, amount, HS code, etc.) for China exports, Vietnam imports/operations, Vietnam re-exports, and final destination imports need to be logically consistent and stand up to scrutiny.

05. Logistics connection

Choose an experienced forwarder to ensure smooth transit and control time and cost.

06. Tax Compliance

Transparent and compliant tax treatment between China and Vietnam is required to avoid the risk of double taxation or tax evasion.

07. Understanding risk

Risks such as policy changes (e.g. tightening of rules of origin, FTA review), strengthening of customs inspection in destination countries, logistics delays, exchange rate fluctuations, etc. exist objectively and need to be planned for.

Utilizing Vietnamese companies for re-export trade provides manufacturing bosses who are mired in the dilemma of costs and trade barriers a way toRapid results and relative flexibilityof the breakout path. Its core values areLegally compliant utilization of Vietnam's FTA dividend to significantly reduce tariff costs and bypass direct trade barriersThe

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But do keep in mind:

• Compliance is the bottom line! The risks of "falsification" and "origin laundering" are too great to be worthwhile.
• Professionalism is guaranteed! Involving the legal, tax, customs and logistics of China and Vietnam, it is important to seek the support of professional organizations (lawyers, accountants, tax accountants, senior freight forwarders, consulting firms).
• Wind control is key! Fully assess the policy risk, partner risk and operational risk and make good plans.

The above is the relevant content of "Vietnam company re-export trade", I hope it is helpful to you~. 

 If you have a company registration, bank account opening and other needs or other questions, welcome to sweep the code to add our online customer service (WeChat: jxhqcy890 / cell phone: 16625410105), to arrange for the manager to answer questions, to provide professional advice and full one-on-one service!