Importing from China? Don’t neglect the certification requirements.

China has lowered the bar for companies to do business on an international scale. While neglected by many importers, product certification compliance is not to be taken for granted when importing products from China. In this article I’ll explain why this is the case, and what you can do to improve your odds.

First, let me tell you something about myself. I’m a Swedish entrepreneur that’s been based in Shanghai, China, since 2009. I’ve managed hundreds of orders for European companies importing from China. Import business is always challenging, but certification compliance is one of the hardest nuts to crack. My hope is that this article will contribute to the general awareness among business owners. If I can make at least one European or American business owner think twice before importing non-compliant products, I’ve succeeded.

Why EU and US certification requirements makes importing from China harder?

Shouldn’t product certification compliance be the suppliers’ concern rather than yours? After all, it’s the manufacturers’ responsibility to ensure compliance when you buy something from within the European Union. However, China is not Europe. This is where many importers get this all wrong.

I’ll explain this in a simple way. The importer is always responsible for ensuring product certification and consumer safety compliance when bringing in products. It would simply be too hard for government authorities to enforce compliance in a foreign country – China included. This puts a lot of weight on the importers shoulders.

What makes things worse is the fact that the vast majority of Chinese manufacturers are either unaware of, or unable to comply with European and American product certification standards. In many industries, as few as 5% of the suppliers can provide previous test reports that shows some kind of indication that the supplier is able to comply with standards such as CE, RoHS and FCC.

So, why is it so hard? It certainly would make sense for a Chinese manufacturer to ensure compliance and become more competitive. Yet, this is not the case. While compliance does require a certain technical expertise and a Quality Management System, personally I think neither of these are the root of the problem. Since China opened up its doors, outsourced production has made international trade available to businesses of all sizes. Previously, international trade was in the hands of larger enterprises and investors. This has opened up great opportunities for startups and small business worldwide, but the problem is that these small business underestimate the complexity of outsourcing production to countries like China.

Few small business owners are aware of which certification standard (or standards) is required for a certain product. Even fewer realize that ensuring compliance is the responsibility of the importer, not of the Chinese supplier. The result? Most Chinese suppliers are rarely even asked if they are compliant with a certain standard when approached by smaller businesses. Therefore the incentive ensures compliance is much lower than it should be.

Sourcing certification compliant suppliers in China

Price matters when importing from China, otherwise you probably wouldn’t bother. However, it’s pointless to negotiate a price with a supplier that is unable to manufacture compliant products, isn’t it? That’s your first question to a supplier should be whether or not they are compliant.

However, words are cheap. You’ll need something more. Your second questions should be whether or not your supplier can provide a previous test report that proves that a supplier is compliant with the standard. If a supplier cannot provide you with this, then assume that they got something to hide and walk away. When you obtain a test report, you need to be sure that it’s relevant for your business. Look for the following:

  • Is the supplier’s company name stated on the test report?
  • Is the testing standard the same as required in your country or market?
  • Is the tested product the same or similar to the one you plan to order? (otherwise, it might not be relevant)

Why a previous test report is not enough?

Received a test report and everything seems fine? Well, I’ve got bad news for you. Some Chinese suppliers have a tendency to be rather dishonest and cut corners. This is not really news, but what it means for you is that you cannot simply rely on a previous test report. The hard part is to know whether or not a tested sample is compliant with the product they are manufacturing for you. This is not the case in the following situations:

  1. If the supplier sent a product from another manufacturer for lab testing.
  2. If the supplier is not using the same materials and components as on the tested sample.

In other words, it’s still possible that a supplier with the right papers might still end up shipping products that are not compliant with the required certification standard in your country or market. This is why you must send at least one sample, from your very own product batch, for lab testing.

There are several international labs with a local presence in China: SGS, TUV and Bureau Veritas to name a few. However, make sure that you or somebody that you trust collects the batch sample and sends them for lab testing. Otherwise the supplier might send a sample that doesn’t come from your batch.

There are also scenarios where Chinese suppliers fail to manufacture compliant products, even when they intend to. In 2011 we had a shipment of plastics that failed REACH testing. This was a major headache since the test result came out the day after the cargo was shipped (I shouldn’t have listened to my client that time). The supplier tracked the issue to a lubricant in the machine. Out of the 50 or so chemicals that are tested for REACH compliance, this lubricant tipped the point for one of them – and with an incredibly slim margin. However, it’s all or nothing in the world of product certification. The plastics where simply not REACH compliant.

FYI: The plastics were still compliant with other certification standards and the client could still use the plastic for industrial usage. All good. Almost…

“Why can’t I buy off-shelf products?”

It would certainly be a lot easier if you could simply sidestep the whole manufacturing process and buy compliant products straight from a supplier’s warehouse. However, there’s a small problem. Compliant products are simply not mass-produced and stored for future buyers in China. It does not exist (apart from in a few rare cases perhaps).

Although there are wholesalers in China that offer buyers to purchase “ready-made” products from a warehouse, these products are in almost all cases manufactured for the Chinese domestic market. Guess what! Products intended for the Chinese market are not compliant with US and EU product certification requirements. Why would they be? It doesn’t make sense to produce for a market to which you are not selling to. It would price the suppliers out of the (domestic) market.

“What can happen if I import non-compliant products?”

Bad things can happen. Bad enough to not even consider this an option. Product certification compliance is not an “optional guideline” for importers to follow whenever they feel for it. They are the laws and regulations intended to ensure a basic quality standard and protect both consumer and the environment.

I know that importers have had their products put under sales band. I also know of cases where imported products have been refused to leave the port until a test report or certification document could be provided. In all of those cases, the Chinese suppliers were of no help and the cargo was destroyed. If you end up in such a situation, you will receive no compensation whatsoever from your government. That’s why you shouldn’t neglect product certification when importing from China.

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