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Is it usual to pay the full amount on goods coming from China before they will be released through customs?
We had some stuff manufacturered in china for our business. We paid 40% up front and now we are waiting for the goods to arrive. Once they arrive fine we will pay the rest. They were supposedly shipped by sea, and the carrier is supposed to call us once the goods have arrived so that we can arrange pickup at the local port. However, the manufacturer is now telling us that in order for us to be able to pick up the goods from the port, we are going to have to pay them in full before the package will be released to us. They claim this is usual business. Seems a bit fishy to me, as in the USA we usually work on having 30 days to pay once the goods have arrived. Any comments would be helpful. Thanks.
Sounds like the shipment was shipped COD for the outstanding balance. You'll have to pay that, plus any duties, taxes, and brokerage fees to have the shipment released. This is standard practice in international commerce.
While a US supplier has some recourse if you don't pay an invoice, a foreign supplier generally can't easily sue you in the US courts for any balance owed.
To protect yourself with international shipments you really need to inspect the final production goods before they are shipped. You either send your inspection team to the factory to verify that the goods are up to spec, or hire an independent quality control inspector to look out for your interests. (This is common practice even for US produced goods by the way. It's not unusual for the end-item's manufacturer to have quality control folks on-site full time inspecting production output for adherence to QC standards.) This is especially important for goods produced in China as quality control there varies from fairly good to horrible beyond imagination. (And many Chinese manufacturing facilities are not above copying your designs and trying to undercut your pricing with pirated goods!)
If the goods have not been shipped yet, better catch the next flight to Shanghai (or wherever) and inspect the product before it ships. Once it's on the boat it will be too late and you'll have little recourse against the supplier. You'd have to sue in Chinese courts and they are loath to rule against a Chinese firm. The judge will ask you outright why you didn't inspect the goods first.
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