Our company has engaged an export agent, and now we are facing the issue of ocean freight payment. We are unsure who should pay this cost—the principal (us) or the agent? The contract did not specify this. Also, at which stage of the export process is the ocean freight typically paid? We hope experienced friends can help clarify this so we can handle the matter properly and avoid future disputes.
The company plans to find an agent for export business and asks questions such as whether payment is required when signing an agency export agreement, the payment stage, and the proportion of advance payment. The best answer is that whether to pay for agency export and related details depend on the terms of the agency agreement. Common payment models include phased payments, such as payments made after signing the agreement, after export declaration, and after foreign exchange settlement, or a lump - sum payment after completing the agency matters. The specific arrangement needs to be determined considering various factors.
Our company intends to engage an agent for import and export business and has doubts about the "who pays, who receives" regulation. We would like to inquire about the entities responsible for making and receiving foreign exchange payments in agency import and export business and the key points to note. The best answer points out that in principle, whoever makes the payment receives the payment. If the agent signs contracts and makes and receives foreign exchange payments in its own name, it is the entity; if the principal makes and receives foreign exchange payments on its own, it is the entity. At the same time, it is emphasized that relevant regulations should be followed, relevant documents should be retained, and responsibilities should be clearly defined in the agreement.
The company plans to engage in agency import business but has doubts about remittance payment, asking whether the principal or the agent should pay, as well as the process, responsibility division, and problem-solving methods. The best answer indicates that the remittance payer is determined by the agency agreement—either the principal pays directly or the agent pays. The agreement must clarify responsibilities, and if issues arise, the responsible party is determined and handled according to the agreement.
The company intends to find an agent to import goods and has doubts about the payment of tariffs for agency import. It asks about the tariff payment process, the subject, the calculation of the amount, and the required materials. The best answer points out that there are two modes for paying tariffs for agency import. The taxpayer may be the agent or the principal. The tariff amount = dutiable value × tariff rate. Materials such as the import declaration form need to be prepared, and professional institutions can also be consulted.
When looking for an export agent to handle the export of goods, inquire about the common payment methods used by export agents and which one is the most reliable. The best answer indicates that common methods include telegraphic transfer (T/T), letter of credit (L/C), collection, etc. T/T is divided into pre-T/T and post-T/T. L/C is guaranteed by the bank but has cumbersome procedures, and collection relies on commercial credit and has risks. The most reliable one is usually pre-T/T. In practice, it is necessary to comprehensively consider various factors to choose a suitable payment method.
The company intends to find an agent to import goods and has doubts about the foreign exchange payment link. It wants to know whether it is the principal or the agent who makes the foreign exchange payment in an agency import business and the relevant rules. The best answer states that the main body for foreign exchange payment is usually stipulated in the agency agreement. Commonly, it is either the agent or the principal making the payment. There may be differences in cases of special regulatory requirements, etc. It is recommended to clarify the main body for foreign exchange payment and the rights, obligations and responsibilities when signing the agreement.
Full escort of the import route, easy access to the global supply chain
Export agent experts, help you easily expand the international market
Avoid tariff barriers, full process transit plan customization
Export tax refund full agency, compliant and efficient fast arrival
International settlement solutions, ensure the safe arrival of funds
A key foreign trade import and export enterprise, with more than 20 years of import and export agency experience, providing one-stop service throughout the entire process!
Professional consultant answers
Andrew HuangYears of service：7Customer Rating：5.0
Supply chain optimization expertConsult
In agency export transactions, there is no fixed rule for who pays the ocean freight; it mainly depends on mutual agreement. If the contract is unclear, industry practices or specific business circumstances usually determine the responsible party.
Generally, if the agent only provides pure agency services without involvement in the sale of goods, the ocean freight is often paid by the principal. This is because the principal owns the goods and bears the transportation costs.
From the export process perspective, ocean freight is typically paid after the goods are loaded onto the vessel but before the bill of lading is issued. This ensures the freight forwarder or shipping company can arrange the bill of lading for subsequent operations like cargo pickup. It is advisable to negotiate with the agent promptly and amend the contract to clarify payment responsibilities to prevent unnecessary conflicts.
Elizabeth LiYears of service：3Customer Rating：5.0
Compliance and risk managerConsult
Usually, the party responsible for arranging transportation pays the ocean freight. If the agent handles tasks like booking cargo space with the freight forwarder, the agent is more likely to pay. However, the final decision depends on mutual agreement.
David LiYears of service：6Customer Rating：5.0
Senior customs declaration consultantConsult
Market practices may also apply. If it is customary for the principal to pay ocean freight in your region, then the principal will likely bear the cost this time. You can inquire about industry practices.
Robert ChenYears of service：6Customer Rating：5.0
Customer service consultantConsult
If the agent charges a higher service fee that includes transportation, the likelihood of the agent paying the ocean freight increases, as the fee covers such services.
Emily LiuYears of service：10Customer Rating：5.0
Settlement and payment expertConsult
Sometimes, trade terms determine the payment. For example, under FOB terms, the foreign buyer usually pays the ocean freight. Under CIF or CFR terms, the seller (principal) typically bears the cost. In agency exports, it depends on the agreement between the principal and the agent.
Joseph ZhouYears of service：10Customer Rating：5.0
Senior foreign trade managerConsult
If the agent has strong bargaining power and can secure favorable freight rates, the agent may pay the ocean freight and incorporate the cost into the service fee.
Sarah ZhangYears of service：8Customer Rating：5.0
Document expertConsult
You can refer to similar agency export cases to see how others handle this issue and use it as a reference for negotiations with your agent.
Michelle ChenYears of service：3Customer Rating：5.0
Business coordination consultantConsult
Consider the transfer of risk. If the principal bears the risk before shipment, it is more reasonable for the principal to pay the ocean freight to align costs with risk.
Jennifer WangYears of service：4Customer Rating：5.0
Market development consultantConsult
If the agent has a long-term relationship with the freight forwarder and enjoys preferential rates, the agent may pay the ocean freight and leverage this advantage for mutual benefit.