How to Write a Proforma Invoice in China — A Practical Guide
What is a Proforma Invoice and Why Does It Matter in China?
A proforma invoice is a preliminary bill of sale sent by the seller to the buyer before goods are shipped. In international trade involving China, the proforma invoice serves multiple critical functions: it is used by the buyer to apply for a letter of credit or import license, by customs authorities to assess duties and taxes, and by foreign exchange authorities to verify the legitimacy of cross-border payments.
While a proforma invoice is not a demand for payment — unlike a commercial invoice — it is a legally significant document that must accurately reflect the terms of the underlying transaction. Errors in a proforma invoice can result in customs delays, foreign exchange approval rejections, and disputes with trading partners.
Essential Elements of a Chinese Proforma Invoice
A properly drafted proforma invoice used in China must contain the following core information: Seller and Buyer Details: Full legal names, registered addresses, contact information, and — critically — the seller's Unified Social Credit Code (USCC) or customs registration number. For foreign buyers, include the full legal name and address as registered in the buyer's home jurisdiction. Description of Goods: A detailed description including specifications, HS (Harmonized System) codes, quantity, unit price, and total value. The HS code is particularly important for customs clearance in China — incorrect HS codes can result in reclassification, higher duties, or even administrative penalties. Incoterms and Delivery: Clearly state the applicable Incoterms (2020 edition) and the named place — e.g., FOB Guangzhou, CIF Los Angeles. The Incoterm determines which party bears transportation costs, insurance, and risk of loss. Payment Terms: Specify the payment method (T/T, L/C, D/P), payment milestones, and the bank account details for the receiving party. Include any advance payment or deposit requirements. Validity Period: Proforma invoices should include an expiry date after which the offer lapses. Market conditions, exchange rates, and raw material costs can change rapidly — an open-ended proforma invoice exposes the seller to significant risk.
Important: The proforma invoice must be clearly marked "PROFORMA INVOICE — NOT A TAX INVOICE" or its Chinese equivalent "形式发票 — 非税务发票" to prevent confusion with the final commercial invoice (fapiao), which has tax implications under Chinese law.
Practical Tips for Guangzhou Exporters
Include the correct Harmonized System (HS) code — this is checked by Chinese customs and determines the applicable export duties, VAT rebate rates, and whether the goods require export licenses. For goods subject to export inspection (many electronics and machinery categories), note the inspection requirement on the proforma invoice to facilitate the buyer's import license application. Keep in mind that the proforma invoice is often the basis for the buyer's letter of credit application — ensure all terms are accurately reflected to avoid L/C discrepancies that delay payment.