DOCUMENTATION IN EXPORTS AND IMPORTING

EXPORTS

• Exports means selling the home country's goods and services in a foreign country

• They are a vital part of an economy• It is the most traditional way and safe way of

entering into a foreign market • It involves marketing of goods produced in the

domestic country in another country

Implications for the home country

Motivations for export

Proactive

– Better profits – Innovations – Technological edge – Tax incentives – Managerial initiative – Scale economies – Information advantage

Reactive

• Domestic market saturation• Competitive pressures • Poor domestic response • Excess capacity • Production overruns • Easy access to customers

and ports

IEC NUMBER• No organization is authorized to export or import without

an IEC number • Register with DGFT for the initial registration process

– Validity period : once allotted remains valid unless it is surrendered by the allottee or cancelled /suspended by the issuing authority

– Loss of IEC number : apply to the issuing authority for issue of a duplicate IEC number

– Modifications in the IEC number • Change of name • Form of business • Changes must be reported within 60 days of such changes ,failing

which he may lose his rights to export • Surrender of IEC number • Obligation to file returns

Export documentation requirements • Earlier documentation work was all manual

and not at all coordinated -120 pages • At present it is –Aayat nirayat • ADS-Aligned documentation system – 50 Page set forms – EDI linkage to facilitate online filing– Fast track mechanism– Time limit set for approvals and sanctions – IEC number to be issued online

Documentation

• Export documents classified into the following categories

• 1. Commercial documents – To effect physical transfer of goods and title to goods from exporter to buyer and to realize export sales proceeds

• 2. Auxiliary commercial documents - documents required to prepare /procure the principal commercial documents

• 3. Regulatory documents - Documents prescribed by various government department /bodies for compliance of formalities under relevant laws

Principal commercial documents

• Commercial invoice and the invoice prescribed by the importer

• Packing list • Certificate of inspection• Certificate of insurance /insurance policy• Bill of lading /airway bill /combined transport

document • Certificate of origin• Bill of exchange • Shipment advice

Commercial invoice • Exporter • Consignee• Buyer• References and numbers with date • Country of origin of goods • Country of final destination• Terms of delivery and payment

– Delivery terms – FOB,C&F,CIF– Payment – L/C,DA (documents against acceptance),DP (documents

against payment )– Precarriage by– Place of receipt by precarrier – Vessel /flight number

– Port of loading– Port of discharge – Final destination– Mark numbers and container number– Number and kind of packages – Description of goods– Quantity ,rate and amount– Signature with date – Commercial invioces

• Consular invoice – to get it verified by the embassy /conculate of the importer in his country

• Legalised invoice - commercial invoice needs to be verified by the local chamber of commerce in the exporting country to verify the correctness of the invoice

• Customs Invoice

Packing list

• Shippping instructions- checklist for the shipping company regarding the shipment

• Intimation for inspection – EIA – export Inspection Agenecy– Consignment wise inspection – In process quality control

• Certificate of inspection – issued by the EIA• Certificate of Insurance /Insurance policy

Bill of lading• Also known as transport documents – bill fo lading/airway bill/combined

transport document • In case of FOB – on board or shipped bill • Received for shipment bill of lading• Clean bill of lading• Dirty bill of lading• Stale bill of lading• Transshipment bill of lading• Through bill of lading• Charter bill of lading• Shorts form bill of lading • House bill of lading

Auxiliary commercial documents

• Proforma Invoice • Shipping instructions• Insurance declaration• Intimation for inspection • Shipping order • Mate’s order• Application for certificate of origin• Letter to bank for negotiation/ collecting of

documents

Auxiliary commercial documents • Proforma Invoice • Shipping instructions– Document serves as checklist of the exporters

instructions to the shipping company for a particular shipment

• Insurance declaration• Intimation for inspection – Certificate of inspection is issued by the EIA after the

preshipment inspection • Shipping order :

• this is a reservation slip issued by the shipping company against the exporter or his agents request for booking of space for a shipment

• Mate’s order– Once the goods are on board ,the master of the ship

issues a document called Mate’s order to the port authorities . This needs to be collected by paying all charges due to the port authorities and then the bill of lading is issued

• Application for certificate of origin• Letter to bank for negotiation/ collecting of

documents • It is a standard covering letter

Regulatory documents • Exchange control declaration form

• GR (Guarantee Remittance )form • SDF self declaration forms• Software export decal;artion forms • Postal parcel (PP) forms

• Freight payment certificate • Insurance premium payment certificate • ARE 1/ARE 2 Forms • Shipping bill/ bill of export • Port trust copy of shipping bill / export application • Receipt of payment of port changes• Vehicle ticket - entry pass to get his export cargo inside the port

for export