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Documentation in International Trade

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Exporters should become familiar with the shipping documents required for an export sales transaction. These documents are essential for moving goods through the channels of distribution, transferring possession and responsibility, clearing product through customs and facilitating payment. Incomplete, missing or incorrectly filled out paperwork delays the export process and adds costs to the exporter.

The following is an overview and description of shipping documents typically used in the export process.

Exercise. Please, choose the right document title corresponding to the definitions listed below and fill in the blank.

Certificate of Origin, Clean Bill of Lading, Proforma Invoice,

Forwarder’s Certificate of Receipt (FCR), International Consignment Note,

Sea Waybill, Rail Consignment Note, Insurance Certificate, Commercial Invoice,

Air Waybill, Shipping Company Delivery Note, Packing List, Import Licence,

Export Licence ,Phytosanitary Certificate.

 

Definitions:

1. _____________________________________________

The document certifies that the goods are taken over by the shipping line in good order and condition, i.e. no damage can be seen on the outside of the packages. The original document represents the title to the goods. It does not usually accompany the goods on their journey but is sent to the buyer separately - either directly or via his bank.

2. _____________________________________________

This document is issued by the shipowner’s agent at a time when the goods are still at sea. The importer has to apply for it. It is handed over only in exchange for the bill of lading which is thereby withdrawn from circulation. It is a promise by the shipowner’s agent to hand over the goods (according to the original bill of lading) to the person who presents this document. The advantage is that the final consignee does not get to know anything about the exporter and that the goods can be inspected before they are handed over to the final consignee.

3. _____________________________________________

This document represents a detailed listing of the contents of the shipment. It may provide a means of quickly identifying merchandise required for gustoms inspection, give a means of determining accurate weights of the goods delivered.

4. _____________________________________________

This document certifies that damages will be paid if the goods are damaged or lost during transport. It is issued for one shipment only and represents the general policy.

5. _____________________________________________

This document is issued by official authorities of the importer’s country. It allows the goods to be imported. The importer applies for the issue of this document to the official authorities in his country. It is wise to obtain this document before the goods are shipped.

6. _____________________________________________

The document shows which goods have been sent off, the unit price and the total price, discounts, packing costs, handling charges etc. It is sent to the consignee e.g. if he is sent goods on approval or free of charge or if he needs to prove how much the goods cost because he has to acquire an import licence. It does not charge for the goods.

7. _____________________________________________

The document represents the charges for the goods actually despatched, including the unit price, discounts, packing costs, handling charges etc. It has significance for debtors‘ ledger or creditors‘ ledger.

8. _____________________________________________

The document shows where the goods come from, the classification of origin. It is usually signed by the chamber of commerce and it may be countersigned by the consulate.

9. _____________________________________________

This document is used for transporting goods by sea. It accompanies the goods on their journey. It is an instruction by the shipper to the carrier to transport the goods and to hand them over to the consignee who is named in the document. This document is not a document of title. Neither is it a negotiable instrument.

10. _____________________________________________

This document accompanies the goods. It is commonly used for road transport in Europe. It is an instruction by the shipper to the carrier to transport the goods and to hand them over to the consignee named in the document. It accompanies the goods on their journey. The shipper can still dispose of the goods as long as they have not been taken possession of by the consignee, they are still at the carriers disposal and the rearrangements do not cause too much of a disruption to the carrier’s business.

11. _____________________________________________

This document is not a document of title. It accompanies the goods on their journey. It is commonly used for transporting goods by rail in Europe. It is an instruction by the shipper to the carrier to transport the goods and to hand them over to the consignee named in the document.

12. _____________________________________________

This document confirms and proves that the forwarding agent has taken possession of the goods in order to transport them to the place of delivery. It is evidence of an irrevocable instruction to the forwarding agent to hand over the consignment to the consignee. The shipper has, however, a restricted right to dispose of the goods before they have been taken possession of by the consignee and as long as the forwarding agent is still entitled to dispose of the goods and the consignee’s wishes concerning the goods have not reached him. This document accompanies the goods on their journey. It is not a document of title.

13. _____________________________________________

This document is defined as a transport document used exclusively for airfreight. Its functions are:

1. It is a legally binding contract of carriage.

2. It is a method of invoicing for airfreight and associated charges.

3. It is a guide to airline and intermediary staff advising them of details of the shipment including any special handling instructions (especially important for Dangerous Goods). Each of these documents is uniquely numbered to aid security, tracking and tracing etc.

14. _____________________________________________

A document secured from a government, authorizing an exporter to export a specific quantity of a particular commodity to a certain country. It is often required if a government restricts exports of certain goods.

15. _____________________________________________

This is a document that certifies that livestock and plants imported or exported have been tested/inspected and vaccinated to make them free of infectious diseases.

 

 

 




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Subject Matter of International Business | FUNDAMENTALS OF MERCANTILISM | N THE LAW OF COMPARATIVE ADVANTAGE | BY M. PORTER | Firm Strategy, Structure and Rivalry | THE THEORIES OF INTERNATIONAL TRADE | Calculating the cost of imports | Consolidated Goods and Services Balance | Table 1. Goods and Services Trade Balance, mln.USD | Table 1. Services Trade Balance |


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