Importing from China to Denmark step by step

Most people who start importing from China find a supplier on Alibaba, agree on a price and only afterwards discover that there is a whole series of things between the factory and the warehouse that nobody mentioned. This is the order of things as I would explain it to a friend who was about to get started.

Before you order

Your business has to be registered for imports. In Denmark your EORI number is DK plus your CVR number, but it only works once the business is registered for customs with the Danish Customs Agency (Toldstyrelsen). You do that on virk.dk. Without it, the goods can't be cleared through customs in your name.

Also check what the product needs before it can be sold in the EU. When you import, you are the one listed as the importer, and that makes it your responsibility that the product meets the rules. That could be CE marking, labelling in Danish or documentation showing that the materials are compliant. It is far easier to get the supplier to sort it out before production than to find out when the goods are sitting in the port.

And find the product's commodity code. It decides what duty has to be paid and whether the product is covered by special rules. Some goods from China carry extra duty on top, known as anti-dumping duty, for example e-bikes and certain kinds of ceramics. You can look the code up in the EU's customs tariff, TARIC, or ask your forwarder. China has no free trade agreement with the EU, so there is no reduced duty to be had.

The order and the agreement

The supplier sends a proforma invoice with the price, quantity and payment terms. It is common to pay part up front and the rest before the goods are shipped. Make sure the agreement states an Incoterm and a place, for example FOB Ningbo. That decides who pays the freight and when the goods become your responsibility. I have written a whole guide on it: Incoterms explained for online stores.

Also ask for carton dimensions and weights as soon as the supplier knows them. They are what the freight is priced on, and without them no forwarder can give you a real price.

Freight

By sea there are two ways. If the goods fill a whole container, you book a container for yourself. If there is less, they travel as LCL together with other people's goods and are priced per cubic metre. Air is faster and much more expensive, and makes most sense for small, expensive products or when something is urgent.

Count on five to seven weeks from the factory to your warehouse by sea, sometimes more, and one to two weeks by air. There is rarely one fixed transit time, so build some slack into the plan.

If you are arranging the freight yourself, get quotes from more than one forwarder. Prices can vary a lot for the same shipment, and so can what is included in the price. Always ask whether the local charges in Denmark and the customs clearance are included.

The paperwork

When the goods are shipped, you need a commercial invoice and a packing list from the supplier. From the forwarder you get a bill of lading when it goes by sea, or an air waybill when it goes by air. Some goods also need a certificate of origin. Check that quantities, weights and amounts match between the invoice and the packing list. Mistakes here are what most often hold goods up in customs.

Customs clearance

It is almost always the forwarder or a customs broker who makes the customs declaration for you. They need a power of attorney from your business and the documents above. Then duty and import VAT are calculated, and the goods are released. How the import VAT is settled depends on how your business is registered, so ask your accountant if you are unsure.

When the goods arrive

Count the goods when they are delivered, and check for damage before you sign. If something is wrong, write it on the consignment note while the driver is still there. That is often what decides whether you can get compensation afterwards.

Then the last invoices come in, often weeks later: freight, duty and fees. Only once they have arrived do you know the real cost of each product. I have written about how to work it out in How to calculate landed cost per product when importing. And keep all the paperwork. The Danish Bookkeeping Act requires you to keep it for five years.

The first time takes a while. The second time you know what to ask, and it goes much faster.