The main differences between offshore trade and entrepot trade are:
- Admin
- Jan 27
- 2 min read
The main differences between offshore trade and re-export trade lie in their definitions, operating methods, and the number of countries involved.
Definitions and Operating Methods
Offshore Trade: This is a new type of trade model characterized by the separation of the "three flows"—order flow, goods flow, and funds flow. The operating methods of offshore trade include offshore resale, global procurement, outsourcing overseas processing, and the purchase of goods for overseas contracting projects. Specifically, offshore resale refers to a domestic trader purchasing goods from abroad and reselling them abroad, without the goods entering or exiting the Chinese customs territory, with cross-border payments made for procurement and sales.
Re-export Trade: Also known as transit trade or re-export trade, this refers to international trade where the sale of goods does not occur directly between the producing and consuming countries, but instead takes place through a third country. The goods in re-export trade may undergo simple processing (such as repackaging, sorting, or selecting) in the third country before being sold to the consuming country. Alternatively, the goods may be shipped directly from the producing country to the consuming country, with no trade relationship occurring directly between the producing and consuming countries. Instead, the third country conducts separate transactions with both the producing and consuming countries.
Number of Countries Involved
Offshore Trade: Involves at least three countries: the producing country, the intermediary country (usually an offshore jurisdiction), and the consuming country. The flows of goods and funds can occur anywhere in the world, but typically, there is no actual movement of goods across borders.
Re-export Trade: Also involves at least three countries: the producing country, the intermediary country, and the consuming country. Goods may be processed in the intermediary country before being sold to the consuming country, or they may be shipped directly from the producing country to the consuming country, without processing in the intermediary country.
Practical Application Scenarios
Offshore Trade: It is commonly used to reduce the operational costs of import and export businesses through integrated international trade practices. Specific application scenarios include offshore resale, global procurement, outsourcing overseas processing, and purchasing goods for overseas contracting projects.
Re-export Trade: In practice, companies can have goods processed in a third country before selling them to the consuming country, or they can ship goods directly from the producing country to the consuming country without undergoing processing in the third country.
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