Opinions, knowledge and resources from China Checkup's expert contributors

What is the China Customs Enterprise Classification System?

by Matt Slater September 12, 2018

What is the China Customs Enterprise Classification System?

China Customs Enterprise Classification is a system used by China Customs to grade companies which engage in foreign trade.

Following a long implementation phase, a new classification system was confirmed in May 2018. It had been updated primarily to reflect China's broader implementation of a nationwide social credit system in recent years.

Under the new China Customs Enterprise Classification system, companies are no longer ranked AA, A, B, C or D - there are now 4 different categories which are introduced in this article.

China Customs Enterprise Classification Background

Companies in China which engage in import and export require both China Foreign Trade registration and China Customs registration.

Although China Customs have had a system in place for grading Chinese companies for many years, a big change was announced in 2014.

The previous China Customs Compliance Rating Scheme, which graded companies either AA, A, B, C or D, was to be replaced by a method based more closely on China's new Social Credit System.

With the new classification system, companies can apply for "Authorized Economic Operator" status which offers preferential treatment such as fewer inspections and simplified Customs processing.

On the other hand, companies with a bad social credit rating are subject to much tighter regulations which can really impede their business operations. 

A decree from China Customs on 1 May 2018 heralded that implementation of the new Enterprise Classification system had been completed.

Classification Systems Compared

The below chart gives a simple approximation of how the new classification system compares with the previous one.

Note however that not all companies previously rated C or D are necessarily now considered to be "Discredited".

Customs Accreditation Classification Accreditation Logo Previous Compliance Rating Scheme
Advanced Certified Enterprise Advanced Certified Enterprise AA
General Certified Enterprise General Certified Enterprise A
General-Credit Enterprise General-Credit Enterprise B
Discredited Enterprise

Discredited Enterprise

C
D

N.B. the text "AEO" present in the first 2 accreditation logos stands for "Authorized Economic Operator" and is given to all China Customs "certified" enterprises.


The 4 Levels of China Customs Enterprise Classification

As you can see from the table above China Customs assesses 4 different levels for Chinese trading enterprises:

  1. Advanced Certified Enterprise
  2. General Certified Enterprise
  3. General-Credit Enterprise
  4. Discredited Enterprise
    Read below for more details on each level:

      1. Advanced Certified Enterprises

      • Rating:
      • Certified: (AEO status)
      • In Chinese: 高级认证企业
      • Other translations: "Senior Certified Enterprise", "Advanced Authorized Enterprise"

      Companies with this authorization enjoy significantly reduced inspection rates, can declare goods prior to arrival at Customs and have a coordinator assigned. Re-authorization for advanced level is required once every 3 years.

      2. General Certified Enterprises

      • Rating:
      • Certified: (AEO status)
      • In Chinese: 一般认证企业
      • Other translations: "General Authorized Enterprise"

      With General Certified status companies are subject to inspection at a reduced rate and get priority in Customs clearance.

        3. General-Credit Enterprises

        • Rating:
        • Certified:
        • In Chinese: 一般信用企业
        • Other translations: "General Enterprise"

        This is the default category for companies which haven't applied for "Authorized Economic Operator" status and have a regular social credit rating.

        4. Discredited Enterprises

        • Rating:
        • Certified:
        • In Chinese: 失信
        • Other translations: "Dishonest Enterprise"

        Discredited enterprises are still able to engage in foreign trade, but do so under much stricter conditions, such as enduring an increased rate of inspections & audits.

        Examples of Chinese Company Customs Classification

        Here are some examples from our research in August 2018 of the current China Customs enterprise classification for some of the more famous of China's millions of companies:

        Customs Accreditation Classification Company Name
        Advanced Certified Enterprise Lenovo (Shanghai) Electronics Technology Co., Ltd.
        Tsingtao Brewery Co.,Ltd.
        General Certified Enterprise Sichuan Changhong Electric Co., Ltd.
        Xiaomi Inc.
        General-Credit Enterprise Beijing Jingdong Century Trading Co., Ltd.
        Shenzhen Tencent Computer Systems Company Limited
        Discredited Enterprise Sinotrans (Tianjin) Storage and Transportation Co., Ltd.

         




        Matt Slater
        Matt Slater

        Author

        Hi there, I'm Matt, the founder of China Checkup. Originally from the UK, I am now based in Brisbane, Australia.

        Frustrated by the scarcity of concise, high-quality and timely information about Chinese companies, I setup China Checkup whilst living in Shanghai in 2013.

        My team are proud that China Checkup's company verification reports have now helped thousands of clients from all corners of the world to do business in China more safely.

          

         


        Related Articles

        Chinese Bill of Lading - House & Master
        Chinese Bill of Lading - House & Master
        Usually when you receive a Chinese bill of lading it will look pretty familiar, it is prepared in English and you will likely be familiar with the name of the carrier. If you don't recognize the carrier's name you nee...
        Read More
        The 8 Busiest China Shipping Ports
        The 8 Busiest China Shipping Ports
        With so many products being made in China it comes as no surprise that China shipping ports are among the busiest in the world. We've looked up the figures, and in this article present the 8 China shipping ports which...
        Read More
        Are Chinese Business Names in English Legit?
        Are Chinese Business Names in English Legit?
        As a foreigner, when you read Chinese business names in English you naturally assume that the name you are reading is the name of the company. In Mainland China and Taiwan, and this can be difficult to comprehend, the...
        Read More


        Also in Safer, Better Business in China

        5 Ways China Company English Names Can Be Misleading
        5 Ways China Company English Names Can Be Misleading

        by Matt Slater September 19, 2018

        We often come across China company English names which we feel are misleading.

        They are misleading for a number of reasons - some accidental, some deliberate, some cynical - but the root cause is that companies from Mainland China are registered in the Chinese language, not in English.

        Here we give some background on China company English names and introduce the 5 ways in which we find they can be misleading.

        Continue Reading

        Which Chinese Currency are in Circulation?
        Which Chinese Currency are in Circulation?

        by Matt Slater September 03, 2018

        If you're travelling to meet or dealing with a Chinese company it is worth bearing in mind that there are several different types of Chinese currency.

        Depending on whether your business is in Mainland China, Hong Kong, Macau or Taiwan you could well need to be looking at 4 different exchange rates. 

        Here we introduce each of the 4 Chinese currency currently in use in "Greater China" - the Renminbi, Hong Kong Dollar, Macau Pataca & New Taiwan Dollar.

        Continue Reading

        What is the Unified Social Credit Code?
        What is the Unified Social Credit Code?

        by Matt Slater August 27, 2018

        If you've dealt with Chinese companies in recent years there is a good chance you will have come across the term "Unified Social Credit Code".

        This unique 18-digit number is issued to all companies and organizations in Mainland China and serves a variety of purposes.

        In this article we provide practical information about the Unified Social Credit Code and explain how you can find each Chinese company's number.

        Continue Reading