China is seeking to establish a legalized system of barter trading to help companies reduce inventories and boost profits, said an official with the China National Excess Inventory Association.

China has launched its first regulations for barter trading in a bid to promote its sound development, [Businesses Registration]said Mao Deshu, vice-president of the association, on Saturday.

Bartering is business by which goods or services are directly exchanged for other goods or services without using money.

"China's barter trade is at a burgeoning stage. It is important to establish sound market order," [HongKong Richful  - Hong Kong Company Formation, Offshore Company Incorporation] said Mao, who participated in drafting the rule.

Companies will gradually find that bartering is a good way to move surplus inventories, attract new customers and increase sales, the official added.