While British companies continue to sell more and more products and services in China across an ever-growing range of sectors and niches, one issue that most face is ensuring that the money they make from Chinese customers finds its way back to the UK. There are a number of possible pinch points in the process, so here we look at a few of the key issues, including banking and foreign exchange controls, ensuring tax compliance, currency risk and recovering debts.<\/p>\n
China still operates certain foreign exchange controls, and banks are expected to ensure compliance with these rules when facilitating remittances out of the country. As such, the procedures they follow have a major bearing on the process of repatriating profits and getting paid. Overseas companies are not able to open full \u2018on shore\u2019 bank accounts in China, and typically British firms trading directly with China will be receiving payment into their UK bank accounts from their Chinese counterparties. This can be a driver for some companies to set up a local entity with a domestic account, but even for those with subsidiaries in China, making inter-company payments to repatriate funds back to the parent company will involve engaging with this remittance process.<\/p>\n