Sanctions screening, export controls, customs classification, and mandatory certification advisory — ensuring your China-sourced goods clear export controls and comply with destination-country import requirements.
Trade compliance for China sourcing involves two distinct legal regimes: China's export control system (what can leave China, to whom, and under what conditions) and the destination country's import regime (what can enter your home market, with what certifications, and at what tariff rate). A failure on either side can result in seized cargo, regulatory penalties, denied entry, or criminal liability.
China's export control framework has tightened significantly in recent years, particularly with the 2020 Export Control Law. Products that may seem innocuous — certain chemicals, electronics with encryption capabilities, advanced materials, or manufacturing equipment — can be subject to export licensing requirements, end-use restrictions, or outright prohibition. The fact that a supplier is willing to ship does not mean the shipment is legal.
On the import side, your goods must comply with your home country's mandatory certification requirements, labeling standards, product safety regulations, and customs valuation rules. A product that is perfectly legal to manufacture in China may be illegal to import into the US, EU, or UK without the correct certifications — and the responsibility for import compliance falls on the importer of record: you.
Key Insight: The supplier is responsible for China export compliance; the buyer is responsible for destination-country import compliance. However, if your supplier ships illegally from China and your goods are detained by Chinese customs, you suffer the commercial consequences regardless of legal responsibility. A compliance review before production begins identifies risks on both sides of the border, not just your side.
Dual-use items, military end-use restrictions, and the Export Control Law (2020). We classify your products against China's control lists, identify licensing requirements, and verify that the supplier holds necessary export licenses.
Screening of suppliers, intermediaries, end-users, and shipping routes against UN, US (OFAC), EU, and UK sanctions lists. A transaction that involves a sanctioned entity or jurisdiction can freeze your payments and expose you to enforcement action.
Correct Harmonized System (HS) code classification determines your tariff rate, eligibility for preferential duty treatment, and applicable regulatory requirements. Misclassification can result in underpaid duties, penalties, and shipment delays.
The China Compulsory Certification (CCC) mark is required for 17 product categories before they can be exported. We verify whether your product requires CCC certification and assist with the certification process through accredited bodies.
CE marking (EU), FDA registration (US), UKCA (UK), and other mandatory certifications. We help you identify what your product needs before it reaches the destination port — where non-compliance means rejection at the border.
Customs valuation methodology, related-party transaction rules, and transfer pricing alignment. Incorrect valuation can trigger customs audits, penalty duties, and tax authority scrutiny in both China and the destination country.
China maintains catalogs of goods that are restricted or prohibited from export. Restricted goods require an export license; prohibited goods cannot be exported at all. Categories include:
Practical Risk: A foreign buyer orders a product that seems ordinary — an industrial sensor, a specialty alloy, or a piece of testing equipment. The supplier ships it without an export license because neither party checked the control list. Chinese customs detains the shipment. The buyer has paid for goods that cannot be delivered, and the supplier may face administrative or criminal penalties. The buyer's payment recovery depends entirely on contract terms — a compliance review upfront costs a fraction of this outcome.
Sanctions compliance is no longer relevant only to large multinationals. Any foreign buyer sourcing from China must consider whether the transaction involves a sanctioned person, entity, jurisdiction, or sector. The reach of OFAC (US) sanctions is particularly broad — any transaction that touches the US financial system (which includes virtually all USD-denominated wire transfers) falls within OFAC's jurisdiction.
We screen the following parties against major sanctions lists:
The China Compulsory Certification (CCC) applies to 17 categories of products sold in or exported from China, including electrical wires and cables, circuit switches, low-voltage electrical apparatus, small power motors, electric tools, household appliances, audio/video equipment, information technology equipment, lighting apparatus, motor vehicles, medical devices, firefighting equipment, and safety glass.
A product requiring CCC certification cannot be legally exported from China without it. The certification process involves product testing at a designated Chinese laboratory, factory inspection, and ongoing surveillance. Timeline: 3-6 months depending on product complexity.
The consequences of compliance failures range from commercial disruption to criminal liability. Here are the most significant penalty categories:
Administrative penalties: fines of up to 10x the illegal turnover, revocation of export licenses, and confiscation of illegal gains. Criminal penalties: up to life imprisonment for the most serious violations involving state secrets or military items. Suppliers face liability directly; buyers may face accessory liability if they knowingly participated.
OFAC civil penalties: up to the greater of approximately $330,000 per violation or twice the transaction value. Criminal penalties: up to $1,000,000 in fines and 20 years imprisonment. Even inadvertent violations — where the buyer did not know the transaction involved a sanctioned party — can result in penalties, though typically at a reduced level.
Underpaid customs duties: recovery of underpaid amounts plus interest and penalties (typically 10-30% of the underpaid duty, but can be higher for negligent or fraudulent misclassification). Repeated misclassification can trigger customs audits of all your import entries over a multi-year lookback period, multiplying the financial exposure.
Customs seizure and destruction of non-compliant goods at the port of entry. Mandatory product recalls if non-compliant goods have already reached consumers. Market withdrawal orders. In serious cases (unsafe products causing injury), product liability litigation and criminal charges against responsible corporate officers.
Real-Time Monitoring: Trade compliance is not static. Sanctions lists are updated daily. Export control lists are revised as geopolitical circumstances change. Tariffs are adjusted through trade policy. We monitor these changes and alert you to developments that affect your product categories and supplier relationships — so you are not blindsided by a regulatory change you did not see coming.
Yes. Customs authorities and sanctions enforcement agencies do not distinguish by company size — they enforce against all importers equally. A small importer who misclassifies goods to reduce duties, or whose transaction involves a sanctioned entity without screening, faces the same legal framework as a large multinational. In some ways, SMEs are at greater risk because they lack internal compliance infrastructure. The cost of a compliance review is a fraction of the cost of a single customs penalty or a shipment seizure.
CCC certification applies to products listed in the CCC Product Catalogue, which covers 17 broad categories. Many products within those categories require CCC certification, but there are exceptions and scope limitations. We can determine whether your specific product falls within the CCC scope by reviewing the product description, HS code, and technical specifications against the current catalogue. This is typically a 1-2 day analysis.
"In progress" is not the same as "obtained." Do not ship until the certification is issued and you have independently verified its authenticity. We have seen cases where suppliers claimed CE certification was "being processed" when no application had actually been filed. If certification is genuinely in progress, structure the contract so that shipment is conditional on certification being granted, with the supplier bearing the risk of delay or failure to obtain certification.
Your supplier can propose an HS code, but the legal responsibility for correct classification at import rests with the importer of record — you. We recommend that you (or your customs broker) independently verify the HS code before the first shipment. Supplier-proposed HS codes are sometimes incorrect, and sometimes intentionally misclassified to reduce the supplier's export documentation burden. Independent verification protects you.
At a minimum: (a) commercial invoice with correct HS code and value; (b) packing list; (c) bill of lading or air waybill; (d) certificate of origin (if claiming preferential duty treatment); (e) any applicable export license from MOFCOM (if the product is on a control list); (f) CCC certificate (if applicable); (g) supplier's declaration of compliance with destination-country certification requirements (CE, FDA, etc.); and (h) for sanctioned-country-sensitive transactions, an end-use and end-user certificate. We can prepare a documentation checklist tailored to your products and destinations.
At minimum, before each significant transaction. For ongoing, high-volume trading relationships, quarterly screening is recommended. Sanctions lists are dynamic — entities are added and removed regularly. A supplier that was clean six months ago may have been designated since. Automated screening tools can streamline this process, but they require initial setup and periodic review of screening parameters.