The export of prepackaged food has always been a headache for foreign trade people.
There are no invoices for purchases, and there is insufficient confidence in customs declaration; the commodity inspection procedures are complicated and I don’t know how to proceed; the risk of paying for exports is high, and they may be back-checked at any time… Can 1039 market procurement trade solve these problems?
Let’s make this clear once and for all.
1. What is 1039 market procurement trade?
The customs supervision method code “1039” refers to the trade method in which goods are purchased in a recognized market cluster area, and qualified operators go through export customs clearance procedures at the customs office of the place of purchase.
Core features:
- The upper limit of the value of a single customs declaration is US$150,000
- Exemption from value-added tax in the export process (no refund)
- Simplified declaration, more than 5 types of commodities can be classified and simplified
2. Can pre-packaged food be subject to 1039?
It can be done, but there are limitations.
1039 applicable commodities include: clothing, shoes and hats, bags, toys, hardware, daily necessities, small household appliances, gifts and stationery and other multi-category, small-volume goods – prepackaged food is within the scope of the category, as long as it does not belong to the prohibited export catalog, it can be operated.
Absolute restricted areas (1039 goods cannot be transported):
- “Catalogue of Prohibited Export Goods”
- “Catalogue of Export License Management Goods”
- “Catalogue of Imported and Exported Wild Animal and Plant Species Commodities”
- Catalogue of Psychotropic Drugs and Narcotic Drugs
- “Catalogue of Import and Export Pesticide Management”
- Catalogue of Stimulants
- Catalogue of Import and Export Management of Gold and its Products
- Strict Restrictions in China
Catalog of toxic chemicals for import and export
Pre-packaged foods require additional attention:
- Confirmation of market access permission of the destination country is required
- Some foods require export quarantine approval
- Infants and young children
Be careful with formula foods and health foods 1039
3. Four steps to operate 1039
Step 1: FilingOpen a qualified self-employed business, file in the designated area, and open a bank account.
The self-employed address must be within the pilot scope.
Step 2: Customs declarationCustoms declaration must be operated by a customs broker with 1039 qualification.
After assembling the goods, a draft customs declaration form is generated through the 1039 Market Procurement and Trade Network Information Platform. After review, it is formally declared and marked with “Supervision Code 1039”.
Step 3: Foreign exchange collection and settlementReal-time settlement.
Foreign customers transfer money to the foreign trade agency, and the agency settles the foreign exchange and then transfers it to the self-employed individual, and completes the filing on the platform.
Breaking through the restriction of “who exports and who collects foreign exchange”, small and medium-sized foreign trade collections are more flexible.
Step 4: Declaring taxesThe tax burden rate is low after verification and collection.
Self-employed individuals are exempt from VAT, no tax refunds are implemented, and the tax process is simplified.
IV. Four major advantages of 1039 for export of pre-packaged food
①
Exemption from VAT, solving the problem of invoice-less exportsPrepackaged food procurement channels are scattered, and it is often difficult to obtain full VAT invoices.
The 1039 model is exempt from VAT, and you can use market purchase invoices to make customs declarations in compliance with regulations, bypassing the Achilles’ heel of invoicing.
② Simplified declaration, higher customs clearance efficiencyIf more than 5 varieties are listed in the commodity list corresponding to each customs declaration form, simplified declaration can be made: the top 5 commodities with the largest value are declared item by item, and the remaining commodities are declared together in “chapter” units.
Significantly reduce the filing workload.
③ Network traceability, confident inspectionThe 1039 market procurement and trade network information platform integrates customs, taxation, and foreign exchange administration information to realize the “four flows into one” of goods flow, document flow, capital flow, and information flow.
The items match each other and I feel confident.
④ Convenient commodity inspection, rapid release of small quantities and small batches For export commodities purchased in markets that require inspection and quarantine, pre-export declaration supervision can be implemented at the place of purchase or origin.
For single export goods with a value of no more than 1,000 US dollars or a weight of no more than 50 kilograms, automatic review of inspection and quarantine documents and rapid issuance of electronic records can be implemented.
5. Key points for the operation of prepackaged food in 1039
Commodity Registration Suppliers must enter product information (product name, specifications, unit price, etc.) in the 1039 market procurement and trade system, and can only export after passing the review.
Packaging and markings must be consistent with the customs declaration, and no false origin or brand logo may appear.
Mixed packaging processing Unified management through the system’s “goods grouping function” ensures that each batch of goods is traceable.
1039 encourages legal consolidation and centralized export.
Quarantine Points Confirm the destination country’s access requirements for Chinese food in advance. Prepackaged food labels must comply with the destination country’s mandatory standards, and the shelf life must be sufficient to cover the transportation cycle.
VI. Guide to avoid the 1039 pitfall
Don’t do these things:
- Fake transactions, operations by non-registration entities – real-time warning from the platform, direct cancellation of pilot qualifications
- Splitting the customs declaration amount to avoid the US$150,000 upper limit – violations
, suspected of tax fraud - False invoices – tax and platform linkage monitoring, violators will be severely punished
- Mixed packaging of prohibited and restricted commodities – the entire shipment may not be shipped
Summary
For pre-packaged food exports, 1039 is a compliance channel.
VAT exemption, simplified declaration, four-stream integration, and convenient commodity inspection—removing the barriers to export exports one by one.
Before operation, confirm that the goods are not in the prohibited catalog, register in the pilot area, find a qualified customs broker, and follow the process, so that the single goods are consistent and the inspection is confident.
