Home – New Forums Logistics Novice Import of Product from China.

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    I’ve been talking to a colleague in China, who has secured the rights to a product which he wishes to export to Australia to expand the market. Apparently it has superior performance and cheaper price than like products on the market.

    Being new to the whole import/export business I’m a bit unsure of the best way forward.

    My colleagues (in China) are experienced and willing to set up an export company in China, so my questions are:

    • Do I need to (or is it best to) set up a company in Australia?
    • Where is the best place to get advice on importing?

    Any help is much appreciated.

    Thanks for your help,

    Farid Zaki
    • Total posts: 110

    The foreign company need to register an Australian subsidiary companies or Australian branch office. Although in terms of taxation there is not a great deal to choose between the two (both are subject to the standard company tax), in practice, most foreign companies choose to operate through a locally established subsidiary company, as this has the added benefits of limited liability and separate legal status. Franked dividends from an Australian subsidiary are also not subject to withholding tax when paid to the foreign parent company. A foreign company that intends to do business in Australia must register with the Australian Securities and Investment Commission (ASIC), in order to do so.

    The government department responsible for importation is the Australian Quarantine and Inspection Service:http://www.daff.gov.au/aqis
    Australian customs & border protection: http://www.customs.gov.au/default.asp

    • Total posts: 625

    A lot of it depends on if you are importing the product at X rate as a simple purchase, or if you are working as an agent or in partnership with your Chinese “partners”.

    If you set it up so your Chinese business associates sell you the stock free and clear at a certain rate including their profit, and you then sell for a profit in Australia, this is quite simple from your end. There is no such thing as an Import or Export license in Australia (that i’m aware of), so in this case it’s pretty simple – although do be aware that you are then taking on the risk of if the product does not move and you could end up holding a lot of stock that you own yourself, with no demand, if things don’t work out as you plan.

    On the other hand if you set up a joint venture company where the Chinese partner and yourself both hold shares and both take on the risk of marketing the product here in Australia and holding stock, this is a lot more complicated accounting/finance/tax/legal wise and you would be wise to speak with a solicitor and accountant who are experts in foreign ownership rules and particularly China (which has some unique complications compared to most other countries).

    Best of luck
    Marketing & Website Solutions Australia

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