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EXPORT IMPORT PROCEDURES AND

DOCUMENTATION





PROJECT ON:

EXPORT - IMPORT
DOCUMENTATION










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INDEX

SR. NO PARTICULARS PAGE NO.
1. SIGNIFICANCE 1
2. CATEGORIES 2
3. COMMERCIAL DOCUMENTS 3
4. EXPORT DOCUMENTATION 4
5. IMPORT DOCUMENTATION 7
6. UNDERSTANDING DOCUMENTS 8
7. REFERENCES 22









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EXPORT
&
IMPORT
DOCUMENTATION



SIGNIFICANCE OF DOCUMENTATION:

Documents are important for the following reasons:
(a) As an evidence of shipment and title of goods;
(b) For obtaining payment;
(c) To provide a specific and complete description of the goods;
(d) For assessment of correct Duty for clearance purpose;
(e) For obtaining Export Licenses;
(f) For obtaining export finance;
(g) For completing Pre-shipment Inspection;
(h) For claiming export benefits like Duty Drawback, etc.

Documents are categorized into two categories, namely Commercial Documents
and Regulatory Documents.
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Commercial set of documents are mainly used for Commerce. In other
words these are documents normally exchanged between buyer and
seller.
Regulatory documents are required in dealing with various regulatory
authorities such as customs, RBI, Excise, Licencing authorities Inspection
and other Export Promotion bodies for availing incentives etc.

Commercial Regulatory
Commercial Invoice Shipping Bill
Inspection Certificate ARE1 from (Excise)
Insurance Certificate RBI Declaration Forms (GR/PP)
Bill of Lading / AWB
Application for remittance of
currency
Certificate of Origin Various Licenses
Bill of Exchange Bill of Entry
Shipment Advice
Packing List



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Commercial Documents
8. Letter to Bank for negotiation
of documents
8. Bill of Exchange
7. Shipping Instructions 7. Packing List
6. Shipping order 6. Shipment Advice
5. Mate Receipt 5. Bill of Lading
4. Application for Certificate of
Origin
4. Certificate of Origin
3. Declaration for Insurance 3. Insurance Certificate
2. Intimation for Inspection 2. Inspection Certificate
1. Proforma Invoice 1. Commercial Invoice
Auxiliary Principal
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EXPORT DOCUMENTATION:
1. Export Sales Contract
2. Pre-shipment Documents
3. Post-shipment Documents


1. EXPORT SALES CONTRACT

Agreement between buyer and seller, stipulating each and every details of
the transaction.
Legally binding document.
It reduces the probabilities of disputes & differences as it fixes the role and
responsibilities of each party.
Terms and Conditions:
While drafting the sales contract one must ensure the following:-
1. Coverage is complete.
2. Maximum clarity.
3. Future probability to be provided.
4. Trade practices.
5. Law of both countries
6. Need of both parties.

There should not be any ambiguity regarding the exact specifications of
goods and terms of sale including export price, mode of payment, storage
and distribution methods, type of packaging, port of shipment, delivery
schedule etc.


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Following standard terms and conditions are covered in an Export Sales
contract: -
Name & address of both the parties.
Contract Number & Date, place
Description of goods, quantity and quantity
Product Standards and Technical Specifications of goods.
Inspection/certification
Total Value of Contract
Terms of delivery (F.O.B./C.F.R./C.I.F. etc.),
Period of Delivery/Shipment, part shipment, Trans-shipment.
Terms of payment:- L/C, D/A, D/P, advance payment, Amount/Mode
& Currency
Taxes, Duties and charges
Packing, Labeling, Marking, etc.
Brokerage/commissions and discounts
Licenses and Permits
Insurance Requirements, Certificates of Insurance
Documentary Requirements
Performance guarantee
Signature by all parties to the contract.
Force Majeure of Excuse for Non-performance of contract
Remedies
Arbitration.





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2. PRE-SHIPMENT DOCUMENTS
Documents at pre-shipment stage are those documents, which are
required to be made, till the consignment is presented to the customs
department for clearance.
The following documents can, therefore, be treated as pre-shipment
documents:
Proforma Invoice
Confirmed order or contract
Letter of Credit
Pre-shipment Inspection Certificate
Packing list
Shipping Bill
Export Declaration Forms (GR/SDF)
ARE

3. POST-SHIPMENT DOCUMENTS
Documents at Post-shipment stage are naturally those which are prepared
after the shipment.
These documents include the following:-
Mate Receipt
Bill of Lading
Airway Bill
Roadway/Railway Bill
Post Parcel/ Courier Receipt
Invoices (including consular invoice)
Certificate of Origin
Insurance Certificate or Policy
Bill of Exchange
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IMPORT DOCUMENTATION:

Invoice
Packing list
Bill of Lading or Delivery Order/Airway Bill
GATT declaration form duly filled in
Importers/CHAs declaration
Licence/Authorizations in original wherever necessary
Letter of Credit/Bank Draft/wherever necessary
Insurance document
Import license
Industrial License, if required
Test report in case of chemicals
Catalogue, Technical write up, Literature in case of machineries, spares or
chemicals as may be applicable
Separately split up value of spares, components, machineries
Certificate of Origin, if preferential rate of duty is claimed under PTAs/FTAs
etc.
No Commission declaration


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UNDERSTANDING THE DOCUMENTS:
1. Proforma Invoice
The starting point of the export contract is in the form of offer made by the
exporter to the foreign customer. The offer made by the exporter is in the form
of a proforma invoice. It is a quotation given as a reply to an inquiry. It normally
forms the basis of all trade transactions.

SAMPLE:
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2. Commercial Invoice:
Commercial invoice is an important and basic export document. It is also known
as a 'Document of Contents' as it contains all the information required for the
preparation of other documents. It is actually a seller's bill of merchandise. It is
prepared by the exporter after the execution of export order giving details about
the goods shipped. It is essential that the invoice is prepared in the name of the
buyer or the consignee mentioned in the letter of credit. It is a prima facie
evidence of the contract of sale or purchase and therefore, must be prepared
strictly in accordance with the contract of sale.


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3. Packing List:
It is a consolidated statement in a prescribed format detailing how goods are
packed, marked and numbered including weight and dimensions of each
package. It is useful for customs at the time of examination and warehouse
keeper of buyer to maintain inventory record and to effect delivery.



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4. Certificate of Origin:
The importers in several countries require a certificate of origin without which
clearance to import is refused. The certificate of origin states that the goods
exported are originally manufactured in the country whose name is mentioned in
the certificate. Certificate of origin is required when:-
The goods produced in a particular country are subject to preferential tariff
rates in the foreign market at the time importation.
The goods produced in a particular country are banned for import in the
foreign market.

5. Shipping Bill:
Shipping Bill is the principal document required by the customs authorities. It
contains description of export goods and other particulars like number and
description of package(s), marks and number, quantity and value as defined in
the Sea Customs Act, Indian or foreign merchandise, name of the vessel in which
goods are to be shipped, country of destination, etc. It is only after the Shipping
Bill, is stamped by the customs that cargo is allowed to be carted to Port sheds
and Docks. It is used for export by sea or air or even for transportation from one
port to another within the country.
There are separate forms of shipping bill for free goods (Free Shipping Bill),
goods on which export duty is payable (Dutiable Shipping Bill), goods for which
there is a claim for drawback of duty (Drawback Shipping Bill) and in case of
imported goods for re-export which are kept in custom bonded warehouses
(Shipping Bill for Shipment ex-bond).




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Types of Shipping Bill
Based on the incentives offered by the government, customs authorities have
introduced three types of shipping bills:-
Drawback Shipping Bill: - Drawback shipping bill is useful for claiming the
customs drawback against goods exported.
Dutiable Shipping Bill: - Dutiable shipping bill is required for goods which
are subject to export duty.
Duty-free Shipping Bill: - Duty-free shipping bill is useful for exporting
goods on which there is no export duty.



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6. Mates Receipt
When the cargo is loaded on the ship, the Commanding Officer of the ship will
issue a receipt called the
`
Mate Receipt'. This includes information about the
name of the vessel, berth, date of shipment, description of packages, marks and
numbers, condition of the cargo at the time of receipt on board the ship etc. The
mate receipt is first handed over to the port authorities for payment of port dues
and then to the shipping company for obtaining the Bill of Lading.

7. Airway Bill
An airway bill, also called an air consignment note, is a receipt issued by an
airline for the carriage of goods. As each shipping company has its own bill of
lading, so each airline has its own airway bill. Airway Bill or Air Consignment Note
is not treated as a document of title and is not issued in negotiable form.
8. Form GR
It is an exchange control document which is to be submitted to the Reserve Bank
of India after clearance from the Customs Authorities. It is designed mainly to
furnish guarantee to the Reserve Bank of India to remit the foreign exchange
earned from the export shipment within 180 days from the date of exports.

9. PP Form
It is also an exchange control document. It is used in place of form GR when
goods are exported by post parcel.




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10. Bill of exchange
The instrument is used in receiving payment from the importer. The importer
may prefer bill of exchange to LC as it does not involve blocking of funds. A bill
of exchange is drawn by the exporter on the importer, to make payment on
demand at sight or after a certain period of time.

B/E is a means to collect payment.
B/E is a means to demand payment.
B/E is a means to extent the credit.
B/E is a means to promise the payment.
B/E is an official acknowledgement of receipt of payment.
Financial documents perform the function of obtaining the finance
collection of payment etc.
2 sets. Each one bearing the exclusion clause making the other part of the
draft invalid.
Sight B/E.
It is known as draft.
Immediate payment Sight draft.
There are two copies of draft. Each one bears reference to the other part
A&B. when any one of the draft is paid, the second draft becomes null and
void.
Parties to bill of exchange:
1. The drawer: The exporter / person who draws the bill.
2. The drawee: The importer / person on whom the bill is drawn for
payment.
3. The payee: The person to whom payment is made, generally, the exporter
/ supplier of the goods.

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11. Marine Insurance Policy
Goods in transit are subject to risks of loss of goods arising due to fire on the
ship, perils of sea, thefts etc. Marine insurance protects losses incidental to
voyages and in land transportation.
Marine Insurance Policy is one of the most important document used as
collateral security because it protects the interest of all those who have insurable
interest at the time of loss. The exporter is bound to insure the goods in case of
CIF quotation, but he can also insure the goods in case of FOB contract, at the
request of the importer, but the premium payment will be made by the exporter.

12. Insurance Certificate
On receipt of these documents the Export Department makes an application to
the Insurance Company for marine insurance cover and requests them to issue
an insurance policy/certificate in duplicate with appropriate risk coverage.

13. Health Certificate
It is required for export of food products, seeds, animal meat products etc. This
certificate is issued by the health Department of the exporting country certifying
that these items are free from infection and contamination.

14. Bill of Lading
The bill of lading is a document issued by the shipping company or its agent
acknowledging the receipt of goods on board the vessel, and undertaking to
deliver the goods in the like order and condition as received, to the consignee or
his order, provided the freight and other charges as specified in the bill have
been duly paid. It is also a document of title to the goods and as such, is freely
transferable by endorsement and delivery.

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Bill of Lading serves three main purposes:
As a document of title to the goods;
As a receipt from the shipping company; and
As a contract for the transportation of goods.
Types of Bill of Lading
Clean Bill of Lading: - A bill of lading acknowledging receipt of the goods
apparently in good order and condition and without any qualification is
termed as a clean bill of lading.
Claused Bill of Lading: - A bill of lading qualified with certain adversere
marks such as, "goods insufficiently packed in accordance with the
Carriage of Goods by Sea Act," is termed as a claused bill of lading.
Transshipment or Through Bill of Lading: - When the carrier uses other
transport facilities, such as rail, road, or another steamship company in
addition to his own, the carrier issues a through or transshipment bill of
lading.
Stale Bill of Lading: - A bill of lading that has been held too long before it
is passed on to a bank for negotiation or to the consignee is called a stale
bill of lading.
Freight Paid Bill of Lading: - When freight is paid at the time of shipment
or in advance, the bill of landing is marked, freight paid. Such bill of lading
is known as freight bill of lading.
Freight Collect Bill of lading :- When the freight is not paid and is to be
collected from the consignee on the arrival of the goods, the bill of lading
is marked, freight collect and is known as freight collect bill of lading




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15. Certificate of Inspection
This certificate certifies that goods being exported are export worthy. It is issued
by inspection authorities in the country of the exporter. The certificate states
that the goods have been inspected under the recognized quality control
standards and satisfies the specifications provided under quality control and
inspection.
If need arises, the importer can demand a Certificate of Inspection from his own
designated inspection agency located in exporter's country. Certificate of
Inspection is a negotiable document sent to importer by the exporter through his
bank.


16. Certificate of Measurement
There are two ways how freight can be charged i.e. on the basis of weight or
measurement. When freight is charged on the basis of weight, the weight
declared by the exporter is accepted. However, the exporter can obtain
certificate of measurement either from the Indian Chamber of Commerce or any
other approved organisation and submit it to the shipping company for
calculation of applicable freight.
The certificate contains details like name of the vessel, port of destination,
description of goods, length, breadth, quantity, depth, etc. of the packages.

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17. Freight Declaration
When the importer agrees to the freight or the overseas supplier pays the
freight; in both the cases freight declaration is needed from the overseas
supplier.

18. Fumigation Certificate
In order to ensure safety against spread of harmful virus importers insist on
fumigation certificate where the cargo includes plants and weeds. Unless this
certificate is provided the cargo will not be allowed to enter into their countries.
The exporter is responsible to carry out fumigation and also obtain a certificate
from the prescribed agency. Serious complications will arise in the absence of
this certificate. Importers insist on getting this certificate from the exporters.
This certificate will enable importers easy clearance of goods.

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REFERENCES

1. http://kalyan-city.blogspot.com/2011/03/documents-in-foreign-trade-
transactions.html

2.http://www.google.co.in/url?sa=t&rct=j&q=import%20export%20documentati
on&source=web&cd=2&cad=rja&sqi=2&ved=0CDQQFjAB&url=http%3A%2F%2F
www.egyankosh.ac.in%2Fbitstream%2F123456789%2F35466%2F1%2FUnit-
8.pdf&ei=V1g9UY6AEsL9rAfQ84DgCA&usg=AFQjCNGoHPMn1VERRPRdTnORD8T
a-llSKg

3. http://www.nfpl.net/pdf/procedure%20for%20import%20and%20export.pdf

4. http://www.managementstudyguide.com/imports-documentation-in-
customs-clearance.htm