Note 4. ADVANCES TO SUPPLIERS

The Company’s advances to third - party suppliers are as follows:

	March 31,		June 30,
	2018		2017

Intelligent logistics system deposit	$	437,356	$	-
Freight fees		-		29,960
Others		4,781		24,930
Total advances to suppliers - third parties	$	442,137	$	54,890

On December 27, 2017, with the approval of the Board of the Company, the Company signed a contract with Tianjin Anboweiye Technology Ltd Co.(“Tianjin Anboweiye”), to develop a more complete and intelligent system based on the Company’s current container trucking platform. The purpose is to help the Company make better connections with the system used by state-owned companies in China, and to satisfy such state-owned companies’ demand for container trucks in the United States. The Company made $437,356 as prepayment to Tianjin Anboweiye in March, 2018.

As of March 31, 2018, advances to third-party suppliers were primarily related to freight logistics services.

The Company’s advances to related-party suppliers are as follows:

	March 31,		June 30,
	2018		2017

Freight fees	$	3,601,421	$	3,333,038
Total advances to suppliers - related party	$	3,601,421	$	3,333,038

As discussed in Note 1, on February 18, 2017, the Company entered into a cooperative transportation agreement with Zhiyuan Hong Kong, which is owned by the Company’s largest shareholder. Pursuant to this agreement, the Company will be a supplier for part of the project’s logistics solutions and, in return, the Company will receive a 1% to 1.25% fee incurred as a commission for its services rendered. On July 7, 2017, the Company signed a supplemental agreement, pursuant to which the Company will cooperate with Zhiyuan Hong Kong exclusively on the Project’s transportation needs with respect to transporting construction materials from manufacturers to the port of Malaysia and to the factory site. Pursuant to the supplemental agreement, the Company agrees to make prepayments to Zhiyuan Hong Kong for its share of packaging and transporting costs related to the Project; in return the Company will receive 15% of the cost incurred in the Project from Zhiyuan Hong Kong as a service fee. The Company will complete its services pursuant to the supplemental agreement and will receive approval from Zhiyuan Hong Kong that the related services fees will be earned by June 2018. The Company also expects the entire advance will be collected by October 2018.