Purchase Money Security Interest Registration Timelines in PBOC System
Registration within ten days of physical delivery grants purchase money security super-priority over prior floating charges under PRC Civil Code Article 416.
Ex Works Delivery
Meaning
An international commercial term establishes that the seller fulfills their obligation to deliver when they make the goods available at their own premises. For an ex works delivery arrangement, the buyer handles all inland transport, export clearance, and international shipping. The manufacturer only has to package the goods and make them ready for pickup.
This term imposes the minimum possible obligation on the selling party.
Carrier Interface
The transition of control occurs at the factory loading dock where the buyer’s designated carrier takes charge of the shipment. Under ex works delivery terms, the seller has no legal duty to load the goods onto the collecting vehicle. If the seller does assist with loading, they do so at the buyer’s risk and expense.
This division of labor means the buyer must hire local logistics agents capable of managing the physical loading.
Customs Responsibility
Export customs clearance is the sole responsibility of the purchasing company, which must arrange all necessary declarations and license filings. In the context of ex works delivery, the seller is only required to provide basic commercial invoices and packing lists to support the export filing. The foreign buyer must secure a local agent with an export license to process the shipment through Chinese customs.
This setup can lead to delays if the buyer does not have a reliable shipping agent in the exporter’s province.
Risk Transfer
Risk of loss passes to the buyer the moment the goods are made available for collection at the agreed location on the specified date. Under the rules of ex works delivery, any damage occurring during loading or subsequent transport is the buyer’s financial liability. The buyer must ensure their transit insurance policy covers the shipment from the moment it leaves the seller’s warehouse.
This shift in liability highlights the importance of using a trusted transport partner for factory pickup.