4 ommrilnqIish l ,r |' |r .

r ' l ( l )l ]t n ts

V. Terms of pamnt for forign trad \. M r r itteI nsur an

Cash against doumnts(CAD) .'..........67 l'r 'itr r :ipleso f insur ar r ............. ..,...' 7 2 8
Doumentsagainst aeptane (D/A) ...................70 ,I 'v1 :s
o f insur ane po liy ................. 1 3 0
Lttr of redit ..'....'.',.",...72 'l'vlrr-.sof loss .. 133
Questionsfor revision .......78 ()r tcstio ns fo r r evisio n
..... 1 3 5
VI. Terms f delivery (Inoterms) l. l'ltrsinss organisations
W (ex works) '.....'........80 'l.lr epr ivat seto r ....,......1 3
Inotertnsfor shiprins.......'..... .........80 'l'lr e publi seto r ............ 1 4 0
Inotermsfor iirultimodal transprt.....................
85 () estio ns fo r r evisio n
.....1 4 2
Inoterms overing payment of duty ....86
Questionsfor revisiorl ............. ..........89 ll. ,l'h stok exhange
Slr nr es ..,......,.I4 4
VII. Transportation l.'i d.inter st sur itis.'.......... ....... 1 4 8
Dornstiand eanshiping ..,,....,...'.92 (]tlestions for rvision .'.., I2
Road transport......... -.......94
Railwy trarrsport .............97 ( lI tl sr y
Air transport............. ...,,..97 l,J glish to Russian .......... 1 5 b
Questionsfor rvision .......98 I tr r ssian to English ..........1 ,7 4

VIII. xport doumnts () o o pe

.........' . 1 9 0
The oean bill of lading ... 101
Air waybill ..... 109
Comlnerialinvi .........111
Pro.fortna invoi ...........111
Customs invoi ..............112
Consuiar invoi ...,.........LLz
Crtifiate of origin ........7|4
Questinsfor rvision ..... 115

I. Customs and duty

Typs of duty .................118
Calulating duty ........ ..... |2o
Customs proedure ..........L2I
Questions for rvision ..... |2
Foreword
l{lIlll{ll tlxperts ar on hand to answer individual que-
I l t..

I.rrt,llttt not least, I would like to thank the staff

rtltrl students of the International Business Shool
This book is primarily intended for languag stu- rrrrrIShulungs-Center Foley in Freiburg, Germany,
dents who need to aquaint themselves with nglish wlr were the guinea-pigs for this book and offered
ommerial vabular, and desribes ertain basi r1tlltlttities of enouragement and onstrutive riti.
priniples of ommerial pratie without aspiring r.|ttt;oleg Rudavin, without whom it probably
to be a definitive textbook on the subjet. However, wrlttldn't have ome into eistene in the first plae;
it is also a useful referene work for people in lan- rtlttl Roland Ferlihia, Kreszenz Kdfer and Mihael
guage-oriented professions. Kiifer, without whom it would hav taken at last
t.wie as long to write.
The materials rryere originall designed for ourses
leading to the qualifiations of European Seretary Hather Frlicchi
and Foreign Language Correspondent offered by the
German Chamber of Commere. For this reason. al-
though no prior knowldg of business is neessar,
students are expeted to have reahed a level of Eng-
lish equivaient to about 6 years of study at shool.

There are twelve units, eah of whih presents a dif-

ferent ommerial topi in an easily omprehensible
form. The essential terms are presented in small
bloks for quik referene, and numerous exerises
give students the pportunity to test their under-
standing and put the newl aquired voabular to
ative use. At the end of eah unit, there are a number
of Questions for revision, whih an either be set for
homework or used as a basis for lassroom disus-
sion. A omprehensiv glossary is inluded at the
end of the book for referene purposs.

Learners requiring translations or eplanations of

ommerial terms outside the sop of this book are
rferred to www.proz.com' where anv number of lan-
peoe
l.]r''lttt?I(t' ll t:e pae BI o}t Tep}I-

r t . , , . t ' l . ( l y ) l Y I ee o a o oBa l{'

l | l -l I l l l l l v ) l ( l , l J l eo B l { a o e o o ' op oNI}Io
l l epe Bo/ loB' pa-
l l | | , I l l l l ( | ( ] ' I ' I ] o po e o a I { I x
l l l | . | ' l t | ( ) | l [ l1 a a e www. pr o z. o m ' oivlo T Ba M
Haoee ooe IIpeI{asaeIIo / ex' o,
sya'r atft,c BI, peMT oee oIIoBa. tlt.llt tl,l.ll .lre BIoIe poer.
ll ttrlltle' xoTea r oaoapT Tex' To
eIIo o3IIaoNI epvlIloolef., o-
l|l)M()l' Me coI,a]i.vI|,r{: opI{oB -
yeo B oMep. He peIi a ae a-
tttlt.t't,'l|tlMeryapo Ig651 ea ye-
3ooo IIpeIIoo vea' a oIIIBae
lt(ti.() lt.(lr{Tpa o pape, prra' l-
eoopIe ooolloaale pI roep-
llllIttIlx aeBe <(IIooIIITtlIx ltpooBD IIp
eo pa}It. Be e]\{ oa eoel{o
t|||ll l'ecol/I IIpl\{eeII NIaepaa' BoLI'Ie[Ieo
oa}fi oeo ae paBoIl:a p,JI'
]l l).l'v lty' 3a x oep}I( IoI{TpIIII0
eao, paoalox oa JIIIBII
l i l , l t . l ' y ; o ea P y a a , e o a T r }I.
llepeBoa.
l.llr llttpl{o' IIoa IIe yBea r B; a TaEe
aepa oToB ovlpa aTopo Bo
l'rl.lltllla ep, Iperea Iteepa xa-
BpM poee opal{oal{Ix Heeo Top-
,rllr ltQlpa' roopIe IIolvIo IIaaT e' IIo pa.
oo aao yerx ypo poecoo Coro-
ltr.ii pe, Boe rpe.
a epTap, earox lvl'fiyapoo -
peo. ooy I{aao ypoBel{ ael{ Xp purc
atlrctl\{ IIto paoI aoIvl o-
oe o,{e r oaoIlo INI.
B ao 1 Beaa aB llpeaBea
oTeIIa oepeIa eMa' 3o}IeIIa B pa-
otl oyo IIoI{iua ope. .( oe-
eII paor IIoeIe epMI BII{.eeIII pal-
\|.' a I{ooeIIIe II p a]EIe I{ tal Ira
o3IvIoE{o IIpoep oe oll{aIIe aepaa
vI aI<TvIBvIpoBa eIIy. B oe a*oo pas-
.ea IvIe oIIpoI' oTopIe NIoy o3o-
Ba o BIoeII oIvIaIx aa,
o raT aeBe e oe o
BpeilI atvil. oap oe II IIoo
rpo raipyt ep[II' eo Ilepeoa o6c-
I{ee.
l. Produtsand Servies The stages of industry
.l'lrr.l.r.
rtre three stages in the proess of making sale-
5 hstagsof industry ||||l.tl)1'()dutsfrom raw materials:
5 hhinof distribution l' l.lxtrative industry
5 Srvis 'l.lrr. t.w mateials ar extrated from natural re-
5 Questionsfor rvision ir)ltres, for example the miner mines iron ore and
tlrr. l'rmer grows wheat.

2. roessing industry

'l'lltl raw materials are proessed into a form suitable

l'rl further use' for example the iron is made into
[lltll and th wheat is made into flour.

i}. anufaturing industry

.l'lt results of the proessing stage are made into
lmi-finished and finished goods, for example the
lrll is made into knives and the flour is made into
lltlad. Finished goods are goods whih are omplete
l themselves, for example steel forks. Semi-finished
gtds must be assembled before they an be used,
I'or example wooden knife handles and steel knife
llldes.

* i
v*-*'A-*l@j Bn
U(1*tv Rgs|G il\Nt}FtAURlNG
lNpU$Ty t}L,gY lt{DU9T
 o rm r i ngI
l ish

The chain of distribution

saleable por / poa)
raw materials Ip N.lr.trrrtllvthe manufaturer sells his produts to the
extrativ industry o ta wllrllt.sale, the wholesaler sells to the retaile, and
poN{IIIIeIt oT llrr. l.r'trriltrsells to the onsu.mer or end.user. Ho.
natural resoures ppo/IlIe peypI ;
tv(.v(|l.ldepending on the type of produt, one or mor
o.rle3I{I ItolaIe
rrlrl'.l's
rttaybe missed out.
prossing industry epepaarBaIo{a
poivlIIIIeIIo
manufaturing irrdustry IIpo3Bo'Bo r:lrinof distribution pea3a
(a opa) tltatrufaturr po3BoJI
semi-finished goods oyapar wholesaler ooI opoe
finished goods oor oap; poy retilr povr Topoe
oIlsllmer' end-user (oeur) opee
xrisei. Wht kind of industry do I work in?
,|.
l,m a mrktgrdene. Lr-.How do you think th fo||owinggoods re
2. M ompnyprodusomputers. dist r ibut ed?
her e m V b mor t h n on
. l work on n iI riq in th North S' a nswer !
4 ln my sprtim,i spinwoo|and sllit to ompaniswhih
mk x|usivkitvl,a l of f the pg |oths
5. I,m rOt, / Dt.,stgllr
|othes
6' |,m Ji-sefishr;nan. i ll;lrld-mdhoo|tes
7. W mk jweI|er. 4 lowers
.' Sttioery
8. W make |ether'
9. |,ma otton WaVe.
10.y ompnynkssteIgirdrsfor bridgs
Servies
xerise2. Ar ths F|NIsHtDr SM|-FlNIsHDgoods?
()ther people do not ti1;.iiltltdirtly to produ-
1.Umbr||s t,itln,but are needed fr exarnpl to transport the
2. ble|egs
goods from the manufaturer to the ustomer, to
3. omputrmonitors
4. Bott|tops lltsure the goods et. These people render sevies.
.l'here are several types of servie:
5. Door hand|s
6. oys
7. BIylsddles
1. Publi servies:
8. Filmntsfor IightbuIbs l)ople in publi servies are employed by the go-
9. rpets
vernment, for example ivil servants and teahers.
10.ShoeIes
 nqlish
ommeri|
| |. tr ittrts nd S e rvie s

2. rivate servies:
Qustions for revision
Private servies are rendered by skilled people with |. (]lroose one or more of the following produts and
their own organisations, for example lawers and rlr.st:ribe(in as muh detail as possible) the proess it
dotors in private praties. ttlltlt:rgoes from the time the natural resoures are
r.t,atedto the time it reahes the onsumer:
3. Consumer servis:
- Bread
. Paper
Consumer servies are servies used by people in their
. Leather shoes
everyday life, e.g. eletriians and hairdressers.
. Wooden hairs
4. Commerial servies: . Copper pipes
Mtllttion th three stages of industry and the hain
Commrial servies are rendered by people who are I' distribution.
needd for the effiient distribution of goods, for
2. Whih tpe of servie do you think is the most
example exporters, b.nkers,agents.
ilrlportant? If possible, rank them in desending or-
rltlr of importane (most important to least impor-
to render servies peoaB y
tnt) and explain why.
publi srvis ore (oap-
er) yrt
private servis aIII
onsumerservis opeeyy
ommerial servies oMpee yy

Exeris4. What kind of servido I rndr?

,l.
|,m teher.
2. |,m pIumber.
. l wok fr shippingompany.
4. |,ma ustomsof fir.
5. I work in wrhouse.
6. I,man insuranebroil'
7. |,m mhani.
8. I own a whoIes| ompanywhih slIslothrng
9. l,m judge.
10.I,mn rhitet.
ll. From enquiry to sles ontrt nquiris
l. Arr enqui or inquiry is a request for informa-
iirlrt. When starting up in business, it is neessary to
5 Enquiris l'trlut the names and addresses of potential busi-
5 Off ers rrr.spartners. one way of obtaining this informa-
l'illlt is to send an enquir to one or more of the fol-
5 oders lw i rrg organisations:
5 S|sontrat ..l'he Chamber of Commere
. A bank
5 omp|aintsand adjustments . Anotlrr ompany - rovided the ompan's own
5 Rminds llrttlrests are not negativel affeted b giving you
l,lrisinfomation
5 Qustinsfor rvision . If jlou re looking for partners or suppliers
rtllroad, you an writ to the otstl]tf th foreign
r:tlttntr in question. T}re onsul's tasks inlude rep-
t rlenting his ountry's eonomi interests abroad
. It is also possible to write to the enrtlss f the
|'llreign ountr. Hotvever, the task of an rnbassa-
rltlr is mainly diplomati and the embassy may not be
lrl to provide as muh ommerial information.

enquiry, inquiry tapo

Chambr of Commere Topoa IIaaTa
onsulate oy.lo
onsul oy
embassy ooo
ambassador oo

2. General enquiry
one ou have obtained the name and address of a sup.
plie, you an send him a geneal enquiry asking for
 l l I l l |l I l l .l l (l i l l r y to sa| s on tr at 19
nglish
ommri|
l informtinabout quntitydisounts.
tr't1ttst
information about the goods he supplies. For example, .l .ttt'vry stisfiedwith your exutionof our first order.
if you are a retailer of eletroni goods and are look- NtlW W wou|d liketo know whthryou ouIdgrnt us
ing for new suppliers' you an write a general enquiry i() (is'redit...
to a manufaturr or'holesaler and ask for atalogues ', .trltlrsssof xportersof Russiando|!s.
and prie-lists. From these, ou an then deide t' wtltlldlrkto know what kindof goodsyou haveto of fer.
whether you want to do business with this ompany. / | trrlllyour ata|ogueW see tht...
lt llrt'foreigntradedepartmentof our banktold us tht you.'.
3. Speific enquiry
4. [nvitation to tender
If you need more details, for example if you al-
ready knw what goods a ompany supplies but Arrther way of obtaining offers from suppliers is to
pub-
need information about how long it will take for ;llltr:lan advertisement in a newspaper or other
lltllrtion. This advertisement is alled an invitation
the goods to reah ou' you an send a speifi
inquiry. Information you may ask for in this type |,ll lnder and is a method often used by publi insti-
of inquiry inludes: t,rrtions suh as government offies. Companies who
. Terms of delivery ttrtl interested an then submit their offers - in this
. Delivery times l.lr.alled tenders - and the best one is hosen to
. Terms of payment rr1lplythe goods or servies required.
. Disounts
. Types of paking offer I]peoeIIe
invitation to tender oee TIiepa
tnder THep
supplier oTaBr
general enquiry apo
I tre is an example of an invitation to tender (look
speifi enquiry eaIII apo
grge20).
terms of dliver yoB IIoa
delivery tims po oa Lxllsez Rd th invittion to tndr bov and n-
terms of pamnt yoB ola swr the fo|lowing questions.
disount }t,a
l, Wht organisationis asking f or tendrs?
paking aoBIa skingf o?
2. What ext|yis this orgnisation
]. Wht ae th trms of paymnt?
xris1' Here e som phrasesfrom nquiry|etters. 4. Wht is the dIivrytim?
in eahas?
Wht kindof nquiryis nernd 5' What addressare th goods to be dliveredto?
6. When is the finaIdte for reiving tndrs?
]. We ow you addressto the hmbrof ommrein
7.Usingyour own words,desribeth ftorswhihth orgni.
LO n O O n. . .
stionwiI|onsidrwhen didingwhihtnderis the best'
2 . ...a r | ooki ng for s u p p |i e r so f f i n wi n e s i n F ne...
20 Cornmlialnglish || | l(lll) ('rlqulrtO s|e s ontrat 21

PUBL|sD No| Offers

oPN lNvlAIoNo NDERNo. 241101
The sup|yof .l20sets of offie furniture
Wlrtln a sller makes an offer or quotation, he pro-
1. Awarding uthority:
i|borough Muniip| ounil, Highst'.iIborough TN.]4Hj lllitJ(}sto suppl his goods on the terms stated in his
2. Awrd roedure: rl|'|.tlr.This means that if a buyer plaes an order on
Pub|i invitationto tnd\^/ith disrtionarywarif ontrat. l.lrr'asis f the sller's offer, the seller must supply
3. Desriptionof the ontrat: |,lrrlgoods as promised. offers an be made orall or
a) Purposeof the ontat; ilr writing, although oral offers are usually onfirmed
hsupplyof 120stsof offifurnttur for th nwllqo.
Vrnmnt offiesin th BristoI Road.iIborouoh. Ilr writing to prevent disagremnts.
b) Divisioninto lots:
.]:
Lot dsksand destl drwerunits Srlliited offers are made in answr to an enquir,
Lot2:upboards and sh|ving units wltreas unsoliited offers are sent on the seller's
Thtwo iotsmybothb wardedto on biddror mb sprtly
awrdedto 2 biddrs' llwrr initiativ in the hope of interesting potential
) Termsof paymnt: l:tttomers.
Paymnt wjllbe madfoI|owing eptan of th furnitur'
4. P|eand period of performne:
) Plet whih the ontratis to be prformed: seller poaBe
Tilborough LolGovrnmnt 0f fis,12Bristo| Road,i|brough qutation pae; pa.
N]gtG .
b) Durtionof ontrator time |imitfor ompletion/de|ivery of buyer o}tyae
work/goods: to pla an order paIe aa
hf urnitur is to b diiverd betwenotoberand Dember 200]'
soliitd offer oTBeoe pe,o)reIIo 3a-
5. Reiptof bids: poy
hefina|dtfor the reit of bidsis 15th'arh2001,12non.
2 opismustb submittd in dditinto th originl,r,vhih
is to b unsoliitedoffer peo}*tIleooeo
mrkeds suh.Bidsto be sentto the addrss irpoint1' IIIIaBe
6. Priodduringwhihthe bidderis oundby his bid:
on yerfollowing th fina|datfor rit of brdsrn'nt5'
7. riteriafor th wrd of ontrt: Lxts Are thseof frs so|iitd
or unso|litd?
Theontrt shllbe awrddto the biddrwhosebidis to b pre- .lOth.
l hnkyou for your Itterdated Apri|onening.'.
ferrdwithrgrdto th bidder,s bility
to mtthwarding author.
ity,snedsnd rquirmnts,
/' We hav been givenyour addrssby...
to b msurd rimriIyby th thnil
qu|ity of th brd,th biddr,s xprin withro1ts of a similr |' As one of the |dingmnufaturers of earthenwrepots
naturandonomi dvantag' in Spinw wou|d liketo of fr you...
8. Other information: 4' In your enquiryyou sttedtht you r |ookrngfor...
As partof itsvluation of the bids,the awrdinq authoritymayr- 't' We are glad to hear that our atloguews of interestto
qustbrdcrs to suppIy. frof a||ostsandhargst th awarding you.
uthority, sampIing of thirf urnitur.
lt is ntirtdthtsampling wi||
tkeplat th beginning of April2001. tj. he hmbrof ommereinformdus that VoU r n
imoorterof...
 iI l l()lr) nqUiry to 5j 5ontr1 23
ommrilEngIish
l'll llirrd himself to the terms of his offer, for eample
Essentials of an offer
ilr Llre ase of ertain goods where the pries flutu.
Ideally an offer should give information about as rrttl (oil, gold), if stoks are limited, or if industrial
many as possible of the following points: rllputes mean he may not be able to deliver on time.
a) Type of goods Ilt suh ases' he an inlude ertain phrases to make
b) Quantit of goods i[ lear that he may withdraw his offer at any time.
) Pries
d) Disounts (e.g. for early ordering/paymentn firm offr, binding offer TBptoe peo)fielle
large quantities) offer without engagement, peo}ee e
non-binding offer oae
e) Delivery times
to withdraw an offer oe/oo3Ba
f) Terms of delivery (see hapter VI) peJIo,eIr
g) Terms of pament (see hapters III and V) valid eer;
h) Type of paking ero y
flutuate oea
xerise4. n Vou math th two olumns?
limited stoks opaellr aa
1.Type of goods A. ash on delivery industrial dispute or
2. Quantity B |F Dovr polvIIIIIeIIoT
. Pris . 800 units
4. Disounts D. 2 wks aftr riptof orde Lxrts5 hese s||ersa|| found themseIvesin situ-
5. rmsof dIivery .5o/oof f orderspIaed tions whih meant they hd to mke non-
withinthe nxt 7 days binding offrs, Whih of th phrses below
6. ermsof payment F. seaworthyontlnrs did they use?
7. Delivrtim G. woodn klthnhairs
8. Paking H. $50 per unit | r. Farmrmd n offer for 100 blesof hay.Howver,
.rtthe time h md hisof fer, the poor wathronditions
Tpes of offer wre mkingIl frmrsnervous.
., Mr. Vintnrprodusa limitednumbrof qu|itywins.H
Firm (binding) offer: The seller must provide the rloesnot produenoughof thswinesto suppIyVery-
goods at the pries and terms given in his offer, and llodywho sks,and so hs to in|udan approprite laus
when mkingoffrs.
may not hange or withdraw his offer after it has
l Mr. Kithener,sompany eports fridgs nd fzrs.
been mad. However, he an state how long he blnds
At prsnthe is havingproblemsWith his supplier,nd h
himself to his offer (e.g. "This offer is valid until .n,tgurntuntiIth vry |astminutethat th goods
15th. otober''). wilIb drspthd on time.
4 the Bostona ompnyimpotst fom Indiaand s||s
offe without eng:agement (non.binding offer): Cer- tt to Arnerinrtilrs.However,inrasing|bour osts
tain fators ma mean that the seller does not want
 ommI.ia|
nglisl^ Il Fromenqutryto sa|esontrt

and poo hvstmns tht th pieof t is rising l |sthisa so|iitd or an unso|iitd of fr? How do you know?
rpidIy. 2. Is it a fimof fer or n of fer withoutenggemnt?How do
5. Mr . Kpr imports xoti animlssuh as snkes nd you know?
monkysfor pt shops' Natura|lyit isn,t aIwassy t 3. What kind of goods r berngoffrd and how muh do
obtinthes animlsjust whn the ar vrlnted' they ost?
,,his
of fer is sub1tto bingunsold',, 4. Wht ar th trms of delivry?
,,his
of fer rs subjtto avarIabilit',, 5. What is the de|ivry tim?
,,our
prisare sub1etto hangewithoutnoti.,, 6. What ar th tmsof paymnt?
,,his
offer is subjetto a good hrvst.,' /. Wht inntivedoes the sI|roffr in th hope of on.
,.his
of fr is sub1etto frnlonftrmation',, viningth buyrto p|aa largorde?
xris6. Hr is typiIf fer letter. Read it and an.
swr th ouestions b|ow. Orders

MLeod nitwer If the buyeris satisfiedwitlr the termsf the seller's

27 Pitlohry Road tlffer, he ma then plae an order. There are a number
d i n b u r gEH
h l9 tG f different types of order:
Sotland
21'lJanuar2001
hSottish Shop trial ordr pl aa
64 Iedonln Road firm ordr pr aa
NwYork,NY 5275
USA standing order IIooIIIII aa

DerSrrs, initial order epBolraar aa

h forigntrddprtmnt of our bnkinformsus tht oU ar n follow.up ordr oey aa
imortrof quiitSottishgoods.our ompanyis on f th lading merhandise otr all oBap o poar
mnufaturrs of traditionl Sottishknitwarand w are sendingyou
our atalogu in th hopof doinglusinss withyou' advane ordr peBaplrTer 3aa3
Shouldyu b Intrsted, W n of fr you th followingvry bulk order oor 3ala3
ab|trms: repeat order oopr/oopar
- hildrn,s rnswtrs @ $59 ah 3aa3
- Ladis,rn swtrs @ $79eh
- Gntlemen,s aranswetrs @ $99 h
Theprisstatedabovr It G|sgow and inludsworthy paking Mth the two o|umns
Lxercls-Z
W an grantyou quntitydisount of 59looff ordrsf 200 sweat.
(ll('Or l)re,Dlivery I Tri|ordr () he UstomerpIasone order f or
n be fftedwithin6 wksof riptof order
P yrl irslt o br 't .f r 'r l r ,db y |e tteor f r d i t . a rtain quntity of goods to be
hisof1 ri s i l b1t 'rt ot o t i r m t l o n ' delivrd t regu|r intevis, .g.
W hpto harfromyu sltlnlassureou thatyourordrwi||b 500 kq. of offe on th first dy
xutd to yourbstsatisftion' of eah month.
YoursfithfuIly, / lirm order (b) Th seond o rdr pIaed with
MLodKnitwar
ompny.
 ommeria|
nqlish
ll I l()rnnqUirvto sIesontrt
. Standingorder () h ustomrordrsa sm||quan-
,,,torordrth goods,th ordr of whih ws pIaedon
tity of goods to test th qua|ity.
(d) h ustomerommits hims|fto 17'l,. Marh'
4. |nitia|
order rl
'..2OO rmsof papeto be d|ivered on the |stworking
buyingthe goods.histype of or-
tly of ah month,Sturdaysxpted.
dr my hve fixd de|iverydt.
(e) he first order p|adwith a om_ l()' As our wrehousespaeis limitedand ustomrdmnd
5. Fo|low_up
order
pny. lor the goods is high,we wou|d Iiketo p|ae...
(f ) Th Ustomr ordrs the goods l] .nd as We hav heard that supp|yis beomrnginre-
6. Merhandis ,;inglydiffiuIt,w would |ikto p|aen ordr now for
on aII a Iongtime befor he needsthem
th goods to be de|iverd at the bginningof next year.
or |ongtime beforthy re vai.
l/. ...qua|ity and quantity as befor'
lable.
(g) he ustomerordersgoodsin |rg l J. W have red your tems of tadend r stisfied with
7' Advaneorder
your onditions. hreforwe wou|d |iketo p|aa...
quantities.
(h)h ustomer orders xtly the !4. .'.tobe deliverd evytwo wks.
8. BuIkoder
l,>. We hope this order will |adto f urtherbusinesse|ations
sm goods as before.
(i) The ustomerp|aesone ordefor betweenour firmsand...
9. Reptordr
lb. ...de|ivey to be effetedon 25th'August.
quantityof goods whih he has
deliveredln parts as and when h
needsthem.
txr-9 What kind of ordr do you think eah of
thesustomerswouId Thr p|a? mayb
xris 8. Hr are some phrses from order |etters. morethanon orrtnswr|
What kind of ordrs hav thse ustomrs l Mr.Brownimport
rpets business
RentIy
f romukey.
plaed? friendgave hlm the nam of new supp|irin Turky.
.l. / Mrs. Grrlkhas smllIothsshop.Hr lothss||vry
PIeasesend us the fo|lowingoffe for test pUrposes:
quik|ynd so sh prefrsto orde |argequantities. Ho-
100 g. Frenhrost
Wever, sh dosn,thve enough spain the bak of her
100 g' Brzi|ian
brakfst
shop to stor Iot of loths.
100 g. JminbIend
t Mr. Whee|eris the owner of pet shop. He speiaIises
2. ...wouId b grtfuIif you ou|dsend us as bfor.'.
in rpti|es, espiIlysnks.Rent|yhe herd from his
. ...ifthr is ny possibi|ity
of you grantingus a quantity
suppIiertht in th next fw months it will beom
disounton this order?
rnreasing|y diffiultto import thm, and so snkes or-
4. |f this order provessatisftoryW will pla soni
dred fter th end of this yer wiIIbeomeonsiderabIy
order nxt month.
more expensiv.
5. .".nd so W wiIla||you whenvrwe requirnW stoks.
4 Mrs. olIinsis th ownr of a heesshop in the south of
6' ...tob de|ivrdby the end of the first wek of very
ng|nd. Sh seIls|rgequantitiesof sometypsof heese,
month.
f or examp|ehddr, nd would to have
find it onvenint
7. ...20,000 pirsof whitetennisshos@ $15a pair...
lh heddrdllveredvrvwek.
 ll' Fromenouirvto sa!sontrat 29
28 ommria|
nglish

5. Mr. ltz.lohmmed owns Wrhousein London and is I make t}rbuyr

a whols|er of hp|othing, whihhe thn sI|sto mar- n nn-bi,lrdi*g f{.."
kt tradrs.e |iksto get th goods as hplys possi.
bIe,nd knows that most manufturers offer disount
if goods re orderdin lrgequntitis, \

\Z
6. Mr. Grahm mnuftursmhlnsto soeifition. H
nedssom prtsto omplt mhinwhih h is ur-
rent|ybuilding'Howevr,he is a brtworriedas the ustom. ..'alrd t.ltntrt is
r needsth mahinin 4 weeks,tim,nd this won,t be Sdler olriudIrvhtl I trfirr
possib|eif h doesn,tgt the parts by rtaindate'
7. M Vintneris n x|usive of fin wins.veryyar,
retaiIr
h liksto hav just on bott|of ah nw wine to tr

$j/
before deidingwhthror not to stok it in his shop.
Bu.r
8. RentIyMs.Johnson'the ownr of bookshop,orderd
20 opiesof nw ookrybook' h book so|dso we||
tht sh has deidedto order nothr0 opis.
9. Mr, Wtherfieldis th owner of sho shop.Reentlyh 2. Sellers tend to mak firm offers when trading
establishedontat with an xportrin ttaly and was so in goods where th pries flutuate a lot. They set
stisfidwith the xutionof his iritiI
ordthat h hs a fixed prie and if the buyer doesn't pla an
odedextlythe same gin. order r.vithin the period of time where.this prie is
valid, the offer expires. The seller an then make
Sales ontrat another offer with new pries to keep up with the
pries on the market.
The sales ontrat is the legally binding agreemnt
reahed b the seller and the buyr (the aties to
I mke tlt bue arr
the ontrat). It an be made orally o in writing' ttnllrditilral (binling) ffer. ..
although it is usual for the ntrat to be dawn up
in writing to prevent disputes.

$
-*'/'t' ...alrd th otrtra:tis
There are three ways to onlude a sales ontrat: nIrri'tl,}rrlrI plae arr
rder within th prid of
l.. This is the most normal way of onluding a sales tirrr stted in the ffer.
ontrato beause most offers are non.binding.
As non-binding offers an be hanged or rvithdrawn
at an time, a sales ontrat does not exist until
the seller onfirms the order, making any hanges
impossible.
 ommerilEng|ish
|| ['romenquirvto slesontrat
3. In this ase, if the buer is not interested in th
'h buer's liabilities are:
goods' he is expted to return them within a ertain . To aept delivry of the goods (this prevents him
period of time, otherwise he will have to pay for them.
hanging his mind after the goods have been sent).
. To pay for the goods within the time agreed.
I srrd *ame goods t th
buer in tlre lrp tlrat lf one party doesn't fulfil its liabilities, the ontrat
h will be intrrested...
l broken (this is alled breah of ontat). Itr this
t:the other party (the injured part) an laim
'..altd the rntrat is r:ompensation.
nlule{l wlren l brry
^\ tlre gds.

nr to fulfil
liability
title
IoIl
oao
paBo orro
doumnt of titl ol{ye' a IIpaBo
o0TeIlo
breah of ontrat apIIIeII tooopa
sales contrat ooop y-poa) injured party opa.aBIIIa opoa
party to a ontrat ooapBala ompensation oa
opoI{a
to onlude a contrat a)T ooop 9. Did a breahof ontrttake |?lf so,
xerise
unonditional eyour' how?lf not,why not?
eooopor
l A mil ord ompanysent some goods to M. Wi|Iiams.
Howevr,he refusdto pt de|ivryof them s thy
After a sales ontrat has been onluded, the seller hd not been ordrd.
and buyer hav to fulfil ertain liabilities (that means 2' Mr. Abraham ordered20 teIevisions from a ompnyseIl-
there are ertain things they have to do). goods.Howver,h hd to returnon of th
ing e|etrial
beausit didn,twork.
tIvisions
The seller's liabilities are: 3' Mr. Watson refusedto pay th f u||priefor a ustomisd
. To deliver the goods on time and in prfet on-
mahinehe had ordered,beuseit didn,txat|ymtth
dition. speifiationsh hd given'
. To ensure that the title to the goods is trans- 4. Mr. Adams sent f ree smp|of wine glassesto potn-
ferred to the buyer - in other words, the seller has trlnew ustomer.Unfortunat|y, the pakgeburstopn
to make sure that the buyer beomes the owner of in the post and the g|sseswere broken.
the goods. This is normally done by passing a speial 5' Mr. Wright sent some spare parts to n airlin.Howver,
doument, the doument of title, to th buyer. sriesof stff strikesbrought the arrIininto finniaI
nd his invoiews on|ypid six months |tr.
diffiu|ties
 m m r i ngI
I i s i ' || l r()menoulrvto 5a|esontrat

Complaints and adjustments I f the seller is late in delivering the goods, the
llttyer an send one or more reminders and tell the
If the seller auses a breah of ontrat, or if there llller that he will withdraw from the ontrat if
is else something Wrong rvith the exeution of the |,lrlgoods are not delivered by a ertain date, the
order, the buyer an make a omplaint. Here ar l'lrral deadline. It an be that the buyer reserved
some of the things a buyer an omplain about: tlr ight to anel th order if delivery was late.
. The goods are of inferio quality. llr this ase, h an anel his order without send-
. The goods are damaged.
ilrg any reminders
. The goods lvere lost in transit.
. The prie is inorret. |l. <:anhappen that the buer suffers a loss if the
. There was a delay in delivery. gtxlds are delivred late ._ he may lse business, for
. The goods were shortshipped (the weight was t'xltmple. In this ase, he an laim damages from
too low or the quantit too small). l,lrrleller; that means, he att start legal proeedings
. Th wrong goods were deliveed. l'llt'ompensation. However, if th delay is aused by
. The goods do not math the sample. l.lttltrsbeyond the seller's ontrol, for example floods,
r.rtrthquakes' war et., the sellr is not liabl for an
xeution IoIle t'the buyer's losses.
omplaint peTe}I; pealvla
infrior ec: aeTBer, oxo justified oooarrt
damaged opeer
adjustlent opaa
in transit y
delay in delivey ap)a oa
reminder (o)-aIoae
shortshipped eooaer deadline pa po
sample opae to resev the right oTaB a oo pao
to anel oTIeIIT
If the omplaint is justified, the sellr has to make to suffer a loss oI{e yl
an adjustment, i.e. he has to offr the buyer som to laim damages poa BotvleeII
form of ompensation. There are four possibilities:
I.. The seller invites the buer to RETURN the goods LxrisloWhatkindof djustmentwou|dyou expet
at the selle's epense. in eahse?
2. The seller REPI"AS the faulty goods at his own l Ytlttordrdtwo hests of best qulityeylon t. Ho.
epense. W('vr,when it rrivs,you find that the quaIityis infrior
3. In some ases' the goods an be RPAIRD by Irl tht of the samp|e.
the seller or at the sller's expense. .lYtttI ordered 50 |dies,drsss ln size 40. Howver,the
4. The buyer keps the goods, but the seller offers rltl..,.,t's
d|ivredre size 42. Nvertheless, th qualityis
him a pie REDUTION. .ltld
';.'.'.l you thinkths dresseswi|lsell just as well.
 nglish
ommeria| Il lrr;m nquiryto s|esontrat 5

. You orderd20 por|aindinnrsevies. Howevr,when

rminder IIaoMaIIe
they riveou find tht du to r|esspking,quite
piees overdue popoelrr; aoar
lot of the re broken.
4. You ordered40 pairsof hndmdlthershos.Whn hiddn,ovrt prr;oceI
they rrive,yOUse that the stithingon on of the shos deferment oTpoa
is brokn.
5. You odrd6 wshingmhins,to be dIiverdwithin
14 dys.Howevr,6 wks |tthy stilIhven,trrivd' Questions for revision
l. What is the differene between a general and
Rrninders rt speifi enquiry? Desribe using examples.
2. What is the differene between a soliited and an
If the buyer fails to fulfil his obligation of paying on
rrnsoliited offer? Desribe using examples.
time, it is ustomary to send three reminders:
3. What is an offer without engagement and when is
Pymentbeomsovrdue lt used? In the ase of an offer without engagement,
I
Y
how is the sales ontrat onluded?
S l | rs ndsf irs t r m i n d e r. h i s m y b e a h i dden 4. What is a firm offer and when is it used? In the
or G ove r t r e m i n d r;t h t m a n s i t m y b e i n |udd ase of a firm offer, how is the sales ontrat on.
i n n of f e r o r s a | s| tt to th e b u y e
luded?
tl
tt
. What is tlre differene between a trial order and
Buy r requests d eferm e n t It th b u r d o sn , t a ns wer , nn initial order?
of py me ntor mke s seono rm|n0erls snI
a prt- paym nI (l. What is th diffeene between a repeat order and
follow-up order?

Buyr e qu st sd fe r m n t l f t h b u y e r d o sn,t ansW r , 7. What is the differene between a standing order

of pa yme ntor make s t h e s e l | rs e n d s thir d r min- ltttd merhandise on all?
a pa rt - ym l l t d e wi t h a f i n a l dedlin f o
p y m n t n d s t t eshis intentio n ti. What do ou understand b breah of ontrat?
t o t a k |e g a Ia ti o n if paymnt (live some examples.
i s n ,tm d b th i s dt
t). Desribe the reasons a buer may have to make
II lt lmplaint. What kind of ompensation would you,
t lr tlre buyer, offer in eah ase?
l f t h e r i s s t i I ln o rep|y,the se|l
e r t k sI 9 |a ti o n aginstth l(). What an ou' as the seller, do if the buyer fails
buyr l l'rrlfil his liability of paying on time?
lII.Terms of paymentfor domesti
trde
5 Wo (ashwithordr)
5 oD (ashon Delivry)
5 Paymenton invoi
5 'P'(HirPurhase)
l. open-ount tems
5 Lasing
5 Qustionsfor rvision
Wlllrtt deiding on the terms of payment, the seller
nrrrlbrryer have to agree on:
. When to pay (for example in advan' on delivery)
. How to pay (for example ash, heque, transfer)
. How muh to pay (whether the seller is prepared
|,rlgant any disounts).
'ypes of disount:
l. I]ULK (QUANTITY) DISOUNT: granted when the
lrrryerorders a large quantity.
..If
ou order more than 250 units, we'll give you
10% disount.''
2. ARLY PAYMENT DISCOUNT: granted when the
lltlyer pays within a ertain period of tim.
..If
ou pay within 7 days, ou an dedut 5%
from the prie.''
:|. AstI DISOUNT: granted whn the buyer pays
r .lt h.
..[f you pay give ol 2o/o off .,,
ash, we'll
to grant IIpoaB
to ddut yep,rBa
bulk disount ooBa Ia
earl pamnt disount Ia a Ilpeoay
t:ashdisount I(a IIp oIIaTe
IIaIII1!!
,l'ltt.
ltlrnts of payment desribed here are all partiu-
Irrr.lvsttitable for domesti trade.
 ommeilnqlish |||.ermsof pvmentfor domestitrade 39

Wo (Cash with Order) ash with order oIIJIaa p alae

favourable peIIoTTer
The buyer sends payment with his order.
unrliable aer
to dispose of a (o); ra
This is fvul'ahte f rrr' br*rtse
tJtere is rtrrisk f m rrt gtting
nrent f th gls, As p*nr*rrt
tn* arit. slrr tirrr befr tlre gds COD (Cash on Delivery)
ar snt *ut- it ttls rntr*I fltt rvs}rk
bh tlr mnry.
The buyer pas the ompany whih delivers the goods
(for example the post offie or the arie) at the
Titi is nt s fvuabl for ntt:, time they are delivred. The payment is then trans-
brtsif tli selle is lrlreliab}, ferred to the seller.
l might y f*r tlr gods arrl lrt
grt t}rltr.Arrrl. if I h;.rvt rttr-n
tlre gls fr try reasl}! t hr,r Hr tr:, the rik f rn nt being
SIlr tmake su that I grt nry ne}r il is minirlr*l. .llnl evett if the
}rrrk' buer refttss t pt dlivry
arrt1 a, l drr.t lg t}rgtls.

}Ire I n* lng rrrrr th risk of

rrt riing gl.I'vr *id f.
h tain dislv{'nt.gef nr is
Beause this term of payment arries a ertain risk tht ] dn't }rvthe hane t
for the buyer, he will generally onl agree to it in itrs*t tlr g*ds lr etitrg
f ths.
ertain situations:
. If he is doing business for the first time with
a reputable ompan.
. If the seller gives him a disount.
. If he plaes a speial, expensive order (for exam-
ple a mahine made to speifiation, where the seller
would have problems to dispose of the goods else- ()mpanies whih don't know anything about the fi-
where), the seller may ask for a part-pament to be tltttrial standing of their ustorers (e.g. mail order
sent with the order. r:mpanies) prefer to use this term of payment.
40 nglis|i
ommri| l | | | ( ' l l nso f o Vm entf o r do m es t i t r d

t,llt.wrdshe pays the balane (the remaining amount)

ash on delivery ollaa IIp IIoTae;
<(IoaTy>> irr weekl or montlrly instalments.
arrier epeo
mail order ompany oIoIIa ol![all; oNI- Tiiis ternr of 111161rries tin rish fr
aIfl oIoI{o TopoB me; tit buyr nra nt be *ble t kop up the
trratnent,and if 1rreturrrs th gotls, I :ll
ltrge esell tlrm as ne\y.
Payment on invoie

The buyer reeives an invoie on or after delivery,

whih desribes the goods delivered, the amount to
be paid and the priod within whih the invoie must
be paid (e.g. L4 days).

lris tnl f piltnnt is

far,urabl f rrrtrcrrrrsI arr
int tlre gds brfre nying
fr tlrm as rrell as h*ving tim payment on invoie oaa o IIoI{IILIceTa
t,o ;ty. hire purhase oya papoIty
down payment epr 3llo; peoaa
balane oao
instalment B3Ilo
interst poeIITI

H.P. (Hir Purhase) open.aount terms

This trm of payment is offered by retailers on ex- With reliable ustomers who plae regular orders,
pensive produts suh as ars, large eletrial items tlr seller might agree to open-aountterms. Here
et. The ustomer makes a down payment of about tlrrl buyer doesn't have to pa for every deliver sep-
1o-2o% of the prie and takes the goods away. Af- nrlttely. Instead, he reeives a statement of aount
 Commerilnglish lIl.ermsof pymentfor domestitrd 4

ever month or quarter whih states the total amount

opn-aount trms yo. opIoo eTa
he owes the buye. He is then epeted to settle
statement of aount BIa o ev
a minimum amount of his debt (10% of the total
to ow r .olrwr
amount, for example).
to settl paaBa'
aIaT
A witlr !{-'' tr rrr'lrthe risk f th tirrer debt o
rit being bl i ktr u t}r ;rymelrts" to rtain oTa; oxpa
At least it's nrre netri.rtltfr: nr* if I }y
irv* -endart irtvtli;eoil rnrrtlr or orl
evsr thr nrntjrs.
Leasing

#
Leasing is different to the other terms of payment,
LInlike II..' I all l1,pfit beause the title of the goods does not hange hands.
frm this terlr f 1layrrtif

\r
It is generally used for larger objets suh as build-
I plae rgular *rdrr. }l*tvrr.r,
the arlvantags fr ffe Bg ings, land and mahiner.
th sr*.
A lease is an agreement between the owner of the
objet (the lessor) and the person who wants to use it
(the leaseholde or lessee), whih gives the lease-
holder permission to use the objet for a fixed period,

I.,nsitlg is g;1rvr* fr nrt: t t}rtr

Do you remember what ..title'' meals, with regard to rgttla itttn frrlr trr opert}.
Livgr a irrg ril' Thr tain risk fr
sales ontrats? nr }rer is ilrat tlt lslrr-lltl
.t ir a1rl t* kp tlp his paynrents,
Pament on invoie, hire purhase and open-aount
terms an all be risk for the seller, as he is depend-
Thrrrks lasir r g, c&
ent on the buer's ability and readiness to pay. For f iu
.rild lgs turd tq r.lil
this reason, he retains the titl of the goods until \
, Y I tlrr
ler
}1. ** *tiht
they hav been ompletely paid for. That means the affd.t.
buer can use the goods but the remain the proper- \/
ty of the seller until the buyer has made full pa-
ment. This ensures that the seller an get the goods
bak if the buer doesn't pa for them.
 ommeriaI
ngIish l||.ermsof paymntfor domestitrd

usuall several ears. In return, the leaseholder pas Questions for revision
rent to the lessor, and is responsible for the objet
1. Compare CWo and CoD.
leased (he has to arrange insurane and arry out
repairs, for example). 2. tI.P. and open-aountterms both rquire the buyer
to pa in instalments. What is the differene be-
When the lease expires, th leaseholdr may be able tween these two terms?
to xtend it or even to buy the objet leased at
a redued prie. In the ase of items suh as tehni- 3. How is leasing different from th other terms of
al equipment, he may be abl to return the objet payment desribed above?
and take out a lease on a newer lrrodel.
4. Whih of the terms of payment lesribed above is
most favourable for the seller and why?
lease apIra; ooBop ape.I
lssor apoa . Whih of the terms of payment desribed abov is
leaseholder,lsse apIl,aop most favourable for the buyer and why?
rent apeIIIIa aTa
to expire ea
to xtnd poa

rrs-l.Whih terms of pymntmight you offer

th e s e u s t o m rs ?
,]'
A ustomromSlnto your musishop and wnts pino
fo his son. However,h isn,t real|yhpp bout buying
the pino outright,in ase his son deideshe doesn't|ike
pIay lngit aftr ll.
2. You reivan nquiryf rom a nW Ustomr.A business
ssoiatof yous mentionstht h hs hrd tht this
Ustomeris in finani| diffiu|ties.
. he Ustomrhas been doing busrness with your firm for
a |ong tim nd has Iwys paid promptIy.
However,h
on|y p|aes one odervryfew months.
4. You own a mi|-order ompny.' You most|ydo businss
with orivteustomerswho order littlnd often.
5. A privteustomrwnts to buy n up.to-dtemodl of
(olDlltrso that he n start his own business.
lV. Money matters and PaYment Banks and banking

When it omes to dealing with money, the banks provide

a variety of servies essential to trade and to the eo-
5 Banksand banking nomy of a ountry. There are two main types of bank:
5 hqus 1. Central banks
5 Bi|lsof xhang
Tlrese are the institutions whih ontrol the banking
5 Qustions for rvision of the entire ountry; they work together with the
government to ontrol the ountry's eonomy. The
entral bank of the United Kingdom is the Bank of
ngland, in the UsA it is the Fderal Reserve Sys-
tem, in single.urrny urope the uropean Cent-
ral Bank, et.

The entral bank has a number of diffrent funtions:

a) To issue banknotes and oins, th ountry's ur-
reny. These notes and oins are legal tender in
the ountry where they are produed; this means
that traders in that ountry may not refuse them
when they are offered as payment.
b) To look after the ountr's gold reserves.
) To make sure that the ountr's urreny keeps
its value.
d) To at as bankers for the government and the
other banks.
r) To keep inflation under ontrol. Inflation hap-
pens when there is a lot more money (in the form
of banknotes and redit) available than there are
goods for sale (in other words, when demand for
the goods exeeds supply). When this happens,
pries inrease sharply and often. T stop it, the
4A ommerilnglish |V.Money mattersnd pyment

entral bank needs to take mon out of irula. aount, but it is possible to transfer money to it
tion, for example by inreasing interest rates (this from a urrent aount.
makes borrowing more expensive and means that .Investment aount. oney paid into this type
fewer peopl will appl for redit), and b in- of aount earns more interest, but th ustomer has
reasing the amount of money whih all banks to inform the bank in advane when he wants to witlr-
have to deposit with the entral bank. draw his money. If it is a fied.term aount, he
may not be able to withdraw the money for a ertain
ntral bank epa}lI (aoaI) period agreed with the bank (for example, five years).
a This tpe of aount ma be used for larger, long-
urren aIoa term savings.
legal tender aooe llaero pTBo
inflation ommerial bank oeI&Iepe oa
supply and dmand peIle IIpo bank aount ao
irulation opar urrent aount ey u
intrest rate poeIla TaBa transation (aoa) oepa
to transfer rnoney epeBo eII
2. Commerial banks t<ldraw a hque BIIIIaT I{
ovrdraft IIppaxo
Thes are the publi or private banks whih people us to withdraw money I I aT e
for their everday mone matters. If ou have a bank deposit aount eo3TIII e

aount for example, it will be at a ommerial bank. savings pre

investmnt aount IIeToI e
There are thre basi tpes of bank aount: fixed-trm aount pour ue
. Current aount. This type of aount is used
for everyday tansations suh as paying bills, trans- eris1.What kindof bnk aountdo vou thinkeah
ferring money and drawing heques. You an have of thes peopl might hav opend?
an overdraft on this typ of aourrt (that means ou
1. A twelv-year.o|d whih he won,t b
hildinheritsJ,l0,000,
an withdraw more money than you have in the a-
abl to touh untilh,s]8'
ount, although ou will have to pay interest for ,,for
An elderlyWomankeeps$200 in her handbag eme.
this servie), but you don't usually reeive interest Sh is persudedto pay it into bank aountfor
genis',.
on the mone you pay in. saftv.
. Deposit aount. This type of aount may be
3. An 18.year-oldbeginswork nd nedsn ountso tht
used for short-term, small savings; the money paid his wages n be pid t the end of the month.
in earns a small amount of interest. It is not possible 4' A oup|ewithyounghildrenwinsa Iargeamountof mony
to draw heques or have an overdraft on this tpe of in th |ottery.
 ommeria|
ngIish
5. A studentnedsa bank ountfor h grnt.
6. A tenagerWantsto sv moneyto buy motor-bike'
Another funtion of the ommerial banks is to pro-
vide redit, in th form of:
. overdrafts. where the ustomer an take out
more money than he has in his aount up to a er-
tain limit agreed with the bank. He has to pay the
mone bak whenever requested by the bank, and he
also has to pay a relatively high rate of interest when-
ever he is overdrawn. For this reason. an overdraft
is not the best option for long-term borrowing.
. A loan is heaper if a large amount of money
has to be borrowed over a longer period. It is usuall
taketr out for one item suh as a ar or a house. and
is repaid in monthl instalments along with a fixed
rate of intrst. A loan used to buy a house or land is
alld a mortgag.
. Cdit ards suh as Visa or Amerian xpress
are used to buy goods without needing to pay for
them immdiately. The ustomer reeives a monthly
statemnt and an either pay the entire amount in
full (in whih ase no interest has to be paid) or in
monthl instalments (plus a fixed rate of interest).
redit I(pT
loan ya
mortgage aa; oTea
rdit ard peTIIa apToa
xris2. What kind of redit did h of thse bank heques.
Ustomers ask for?
1. Mr. and Mrs. GrringtonsoIdthir old hous and bought
a new one.Howevr,s the nw houswas muh largrnd
moe Xpensive,thy ndd editto py the diffren. ations.
lV. Money mttersnd pyment
2. .Jennyis a studentwhos inomon|y just meets her ex-
penses.ln the winter months her heatingnd Ietriity
bi||sare higher,nd withoutreditsh wouldn,tlwysb
b|to py them.
' Adam Wantsto buy ar, but on|yhas enoughsavingsto
buy an old one. He wouid rathermak us of his bnk,s
redit fi|itiesto buy nWr model whih hopefuIIy
wou|dn,tnd repairingso oftn.
4. Mrs. Brown hs her own ompany.She travels |ot on
businessand Iikesto mak us of her bnk,sreditfi|itls
to spradher epnsesoVa Iongerperiod.
5. M. Priehs to py th rnt for his prtmenton th first
dy of every month' Howvr,he on|y reeiveshis s|ary
on th third dy of th month.Without his bank,srdit
he wouldn,ta|waysb b|eto pay th rnt'
failities,
other ommerial bank servies inlude:
. Standing ode failities, whre the same amount
of money is transferrd from one aount to another
at regular intervals. For eampl, somebody might
set up a standing order to pay the rent autmatially
ever month.
. Diret debit failities, where a varing amount
of mone is transferred from one aount to another
at regular intervals. For eample, somebody might
set up diret debit failities to pay his telephone bill
automatiall every month.
. Advising their ustomers on making investments,
for example in gold, propert or shares.
. Safe failities for their ustomers to lok up va-
luable artiles suh as jewellery or important douments.
. Providing foreign urreny and traveller's
. Paying out ash (for example from ash dispens-
ers) and aepting ash deposits.
. Providing heques and arrying out heque trans-
s2 ommerilnglish lV Mone mttersnd payment

standingorder ooI{tIIaa drawer paa; o' oaBIIIee e

diret debit plvloe eeoae drawee TpaaT; o' a oopoe BITaBJI
invstmnt Be; Bo}eIIe I{e e paTa
property MyBo; oBro paee l]oyaTe IIo ey
shars a to debit eeoa
saf drawn n IIIa a
ash dispenser aoa
dposit aTeE(: B3I{o Cheques are supplied by the drawee (the bank) and
filled in by the drawer. Here is an example of a heque
drawn on a British bank:
Cheques
(a) (b) () (d) (e)
A heque is a ustorner'swritten order to his bank to
I
pay a ertain amount to a ertain person or organisa. \\ V
\/
tion whn requested. As we already knorv, a heque '
\ r NatWest -r.sl-ro-t
".'.,, \ .lr n .' lr h r

an only be drawn on a urrent aount; further-

\ t 6 t oh st l r n lr fr in cn a !7 9 fl
.^,.!f,''',{1
^,"'.r:n \^, at"
more' heques aren't legal tender - that means sel- , . ' J -t.
. 1-ltol. . l1 ^.
. \. ^ o. nfd'l --
lers are not obliged to aept heques as payment. li5?.so l ; *!.s}.a..."_d]sq fa? -so
They are generally only used for domesti trade. _|i *" , ,a^.r*t^
"
i..: :1 _ #._*- l a.Lc{,o.
* ' " " f f - sL rir ,'"
1\
\
Parties to a heque lAO0lA2A sl". ?0]?|: o, '. *'o*'. o.
oof

t lt t t\
(i) (i) (d) (h) (s) (r)
(a) The paee's name
(b) The amount whih the payee is to reeive, written
in words
() The drawe's nam
I am th The drawer's I am th PAY. (d) The bank ode
DRAWR. bank is the I get the money, (e) The date on rvhih the heque was drawn
I write the DRAWEE. ither in ash (f) he amount whih the payee is to reeive, written
heque and give Inthis as, th from m bank or
it to the paee. heque is drawn paiddiretly into in numbers
The money is on the NatWest my bank aount. (g) The drawer's signature
debitd from m bank. (h) he drawer's bank aount number
urrnt aount. (i) The heque number
54 ommerilnq|ish |V.Money mttrsand ayment 55

(j) The heque stub (also alled the ounterfoil). (b) This is a full endorsment:
When the drawer has written the heque, he tears
out the main part and gives it to the paee. ?a l|/illtan Sntt or ordr
He keeps the hequestub as a reord of the heques
he has written. 'r. . Zl
The person ngotiating the heque writes the name
bank ode ao o
of the new payee and the words "or order", then signs
signature o.
it. This means that only the new payee' in this ase
heque stub, ounterfoil opeIol
William Smith, an get the mone. However, the
words ..or order'' mean that William Smith an nego-
Types of heque
tiate the heque again himself if he wants to.
1. The heque shown above is an order heque. on it () This is a restritive endorsement:
is written: ..Pay r. x. Y. Zapp oR ORDER.''

This means that this heque is only paable to ?a| t/iujab'Snltl,

Mr. X. Y. Zapp. To get the money, he has to prove a /(07 to otdr
g. Z/
that he is . Y. Zapp and sign the bak of the heque -r.
in front of the ashier at his bank.
The person negotiating the heque writes the name
However, if x.Y. Zapp owes someone lse money, he ,.and rrot to order'',
of the new paee and the words
might deide to negotiate the heque, that means to then signs it. This means that only the new payee
pass it on to another person as pament. To do this, (in this ase William Smith) an get the mone.
he has to make either a blank. full or restritiv The words .,and not to orde'' mean that the new payee
endorsement. annot negotiate the heque a seond time.
(a) This is a blank endorsement:
order hequ opepr ue
payable to o.}I(aoae;
pTaIo
.Y. . Za/
to negotiate de.. epea;
epTy
The person negotiating the heque just signs his name blank ndorsement 6laor .oaMeII
on the bak of the heque. However, this is quite full ndorsemnt or II,oaNIe
risky - anyone holding a blank endorsed order heque restritive endorsement opaul
11.oaNIII
an get the money.
56 ommeri|
nqlish lV. Money mattersand payment 57

2. A heque with the words ..Pa ... or bearer'' is

alled - not surprisingly - a bearer heque. Any. r .ar
body holding (bearing) a bearer heque an get the
money; it doesn't have to be endorsed.
4. The pay's aount is
reditd and the drawer's
aount is debited.
Giry)
\- .-J

3. The heque shown above is a rossed heque - 1r

rossed beause it has 2 lines drawn aross the mid-
dle of it. This means that it annot be ashed. it an
only be paid into the payee's bank aount. The pro-
edure is as follows:
The problem with rossed heques is that the payee
only gets his money if the heque is overed - that
means' if the drawer has enough money in his a-

ffi
ount. For this reason' the payee might ask for
G1l 1. Th drawr (right) draws
a marked heque; this is a heque marked with a gua-
rantee that the payee will reeive his mney.
\,
\\,--{F
/r the hque and givs it to
th payee(left).
4. If these two lines are not present, the heque is an
\-'l"'
4/ pen heque.An open heque doesn't have to be paid
into a bank aount; the payee an present it to the

I bank and reeive ash in return.

Dishonoured heques
G\ 2. The ayee fills out a pay.
ing-in slip and givs it and
In ertain irumstanes, the bank an rfuse to ho-

\2 th heque to his bank.

nour a heque (they an refuse to pay out the amount
tated on it). This an happen in the following situa-
tions:

l\/
3. Th payee's bank pre-
snts the heque to the
drawer's bank.
. If the drawer doesn't have enough money in his
bank aount to over the heque.
. If the drawer has stopped the heque (that means
if he has instruted his bank not to honour it). He
an do this if he suspets the heque ma have been
lost or stolen, but has to pa a fee for this servie.
. If it ls suspeted that the heque has been forged.

I . If an essential part of the heque is missing,

uh as the drawer's signature or the date.
58 ommrilnqlish lV. Mone mttrsnd pymnt 59

. If the heque is stale (out of date). The payee (b) I{ A'{ LGIIIDI.AN BAl(
has to present the heque to his bank within a er- BA.l|cA}R sR' olr{BAY 1651 ?
tain period of time from the date it was drawn
(6 months in the U). If he doesn't do this, the hequ
automatially beomes invalid.
2 ]t }4. 5 oo

barer heque a peBe

rossed heque <IlpeepyI) e ()
paying-in slip a, aIIoIIe{I p
IIeIl y4I a
overed oprr; oeeer
marked heque eI apae oar
open hequ oprr ue
to honour a heque oIIaT I{; IIpIl elt
I oIlae
forged oeIrI;
(d)
ari k.J",l 'p
invalid e.er

xeris3. Look at ah of the heques b|ow and n-

swer th questions for ah one.
,L,o'' B"^
1. Who is th drawr?
2. Who is the drw?
. Who is th pay?
4. ls it a brror n ordr heque?|f th pyee Wantsto
Bills of xhang
ngotiteit. does h hav to ndorsit or dos h just
A bill of ehange is an unonditional order from
hve to hnd it ovr to the new py?
5. |sthe hequopen or rossed?an it be ashedor does it one person to another to pay a ertain amount at
hveto b paid lnto bank aount? a ertain time. The money an be paid either to the
person who gave the unonditional order or to a third
(a)
3o g l Ba h .( 't h party. Bills of exhange an be usd for either do-
z.tkiolrrPrl.wA ]-1....a1
mesti or foreign trade.

The parties to a bill of exhange

A payment transation made by bill of exhange ge.

nerally proeeds as follorvs:
0 ommi|
ngtish |V.Money mattersnd pament 61

1. The drawer makes out the bill of ehange and

bill of exhange ao Be;
sends it to the drawee (the person who has to pay it).
paTa
He may send two opies (the first and seond of ex- first/seond of exhange epr/opo
hange) in ase one gets lost. a3e4p eeJI
to apt p ( oae)
2. The drawee has to aept one of the bills by sign- draft IIaTeEIIoeOpeIIe
ing the front of it. If two opies are sent, the opy aeptan aII
whih the drawee doesn't sign automatiall beomes matuit aa' po BIIIaI
invalid. A bill of exhange whih hasn't yet been
aepted is alled a draft; an aeptd bill of ehange Types of bill of ehange
is alled an aeptane.
Eah bill of exhngebelongs to a ertain ategory, de-
3. Th drawee then snds the aepted bill of ex- pending on th time at whih it matures (has to be paid).
hange to the paee' who may be the d'rawer or
a third party. At maturity (tire date on whih the 1. A sight bill inludes tlre words ..Pay at sight''.
bill of exhange has to be paid), the paee presents The drawee has t pay as soon as the draft is pre-
the bill for payment and gets his money. The payee ented (as soon as he sees it).
an also negotiate th bill of exhange, but has to 2. Time bills ar payable at a fixed or determinabl
endorse it first (blank, full or restritive endorse- future time. There are two types of time bill:
ment). (a) A term bill is paable a ertain number of days
after it is presented to the drawee, e.8. ..Pa at
l draw rh bill 90 days afte sight''
f hangtl. J,pa th bill (b) A date bill is payable a ertain number of days
f e:hrrg. after it was drawn, e.g. "Pay at 60 days".

sight bill Bee oIIa o IIpBeII

}r*wr
time bill Bee o poolu oIIaI
term bill Bee oao Ter
ya3aIIIIoo poa
Paee Be aallo ao oIIaI
date bill
,..ff
e"{
4. Lookat the billsof xhngbe|owand n-
Exrise
swerth questions for eahon.
3'd part'
1.Whois thdrawer?
2.Whois thedrawee?
 ommerialnqlish lV. Mone mttersand pyment 63

. Who is the payee? Disounting a bill of exhange

4' What kindof bi||of exhnqeis lt? Whn wi||it haveto be
oaid? If the paee needs his money before the bili of
(a) exhange reahes maturity, he an have it dis-
DrwnundrrditnumbrjFDU89,I67 of
UN|VRSAL BANK,NWARKNJ dted29th. ]une2000 ounted. This means he an take it to a bank whih
Dte 25th.July2000 For USD20,000 will pa him its value minus interest and bank fes
At 60 daysftrsight Py this firstof xhnge (the disount). The amount deduted depends on
to th orderof oURSLVS the length of time before the bill reahes maturity
th sumof twntythousndU5 do|lrs
and on how high the risk is that the drawe won't
for value reived.
o UnivrsI
Bank For and on beha|fof pay.
Nwark,NJ AB orportion
Washington, D In turn, the bank ma be able to have the bill of
exhange redisounted at the entral bank. Howev-
(b)
Dated London, 2th'Jan.2002 For UR2,500.00 er, the entral bank only redisounts a limited number
At sight pay this so| of exhng of bills, depending on how high the inflation rate is
to the order of ourslvs
(if inflatirr is high, fewer bills will be redisounted
urotwo thousndfivhundrdonly
vIuereivd, ordno.]62 in order to prevnt more money going into irula-
To Vrrt GmbH HlbornGIasswors tion).
Huptstr.19 21Upminstr Rod
70120Stuttgrt London4 8DF
G r mny
Protesting a bill of exhange
n g | n d

A protest is a formal written notie that a bill of

xhangefor A$ 8,600.00 Sydney.2"d.Jun2000 exhange has been dishonoured, and is needed be-
At 90 days py this first of exhange
(sondof samdatndtnorunpaid) fore the paee an go to ourt to reover the money.
to the order of If the drawee doesn't pay the bill of exhange when
Albertjohnson& o.,271 |\4lbourn
Road,Sydny it is presented to him at maturity, it will be present-
ightthousand sixhundrdAustra|jn do|lrs ed to him again within two working days, this time
VIue reeived by a notar publi. If the drawe still doesn't pa,
To MihlJons the notar stamps and signs the bill as a reord of
121G l mo g aRno a d
Adelid the dishonour. Suh as dishonour is a serious mat-
GogJohnson ter; it ma be published in trade journals and at the
271M|bourn Rod Chamber of Cmmere, in whih ase the drawee will
Sydn
lose his good reputation.
 lV. Mony mttersand aymnt 65
64 ommerilEnglish

10. Using your own words, desribe the different

to disount a bill IIpI{ Bee oorvt
types of bill of exhange.
to rdisount epeyeT BeI(
protst opoToalre; poe 11. What are the advantages and disadvantages of
to dishonour oTata oIIJIae disounting a bill of exhange for the paee?
notar publi oapy (oyapet)
reputation 12. How safe do you think making payments by bill
eya
of exhange is when ompared to paying by heque?

Questions fo revision
1. What role does the entral bank pla in the eo-
nomy of a ountry?
2. Whih funtions of the ommrial banks do you
think are the most important for private ustomrs?
And for businss ustomers?
3. Using our own words, explain the differene bet-
ween an ovrdraft and a loan.
4. Using our own words, eplain the differene bet-
ween standing order and diret debit failities.
5. Whih kirrd of heque is the safst, and why?
Whih kind of heque is the least safe?
6. In whih situation is a hequeor a bill of exhange
endorsed? Compare the three types of endorsement.
7 . W h at d o yo u unders tand by "dis hono ur ing
a heque''? In whih situations may a heque be dis-
honoured?
8. Who are the partis to a hque? And to a bill of
exhange?
9. What is a draft, and what happens to it?
V. erms of payment for foreign Whn doing business with ompanies abroad, it is
trade not always possible to use the terms of payment us.
tonrary in domesti trade. This is beause the seller
needs to hav more ontrol ver payment.
5 shaginstdoumnts (AD)
If ompan A in England sells goods t ompan B in
5 Douments (D/A)
againstptan the same ountry, it is relatively easy to reover the
Lttrof rdit debt if ompany B doesn't pay. Company A just sends
three reminders to ompan B, and if this doesn't
5 Qustionsfor rvision work, they an start legal proedings.

Howevr, if ompan A exports goods to ompany C

in China (for example) and ompany C doesn't pay,
this wa of reovering the debt isn't pratial.
Therefre' ompan A has to make sur that the
Chinese ompany only gets the goods if they pay in
China. In order to do this, both ompanies work in
lose ollaboration with their banks and arrirs.
The three terms of pament ommonly used in
foreign trade are:
. Cash against douments (CAD)
. Douments against aeptance (D/A)
. Letter of redit (L/C)

Cash against douments (CAD)

This term of payment is also known as douments
against payment (D/P). The buer needs the trans.
port douments before he an take possession of the
goods he has purhased, but is only given them after
paying a sight bill drawn by the seller.
 V. rmsof pVmntfor forigntrde 69
ngIish
ommri|

A CAD payment transation is effeted as follows: . The buyr pas th sight

bill and rives th trans-
port douments in rturn.
He an thn tak the trans-
1. The seller sends th port doumnts to ollet
goods to the arrier (ship his goods from th arrier LLlNG
owner' airlin t.). in his ountry.

I
G RlANy

%
2. Th arrier gives th
.r. I nssary transprt dou-
mnts to the sllr and
trarrsportsthe goods to th
buyer's untry. 6. The ollting bank sends
6'1\NY PN oLL|N6
the payment to the re-

t
mitting bank.
The amount is redited to
3. Th seller ollts any the seller.
othr transport douments
whih ma be nessaryand
gives them to his bank (the
/t|l
rmitting bank) together
with a SIGHT DRAFT. BNl{

This means that if the buyer doesn't pay, he doesn't

4. The remitti ng bank
gt the goods. This minimises the risk for the seller,
beause if th buer doesn't pa, the seller an ask
th olleting bank to find another buer. In theory
this minimiss the loss for the seller, but may be
a problem if he is exporting perishabl $oods, for

1
sends the transport dou-
example.
ments and the draft to the
buyer's bank (the ollet. CAD holds a ertain risk for the buyer, beaus he
ing bank). The buyer is doesn't have the hane to examine the goods before

I
notifid when thev arriv. he has paid for thm. However, this risk an be mini-
ANK mised by asking the seller to arrange examination of
 nglish
ommeria| 71
V. ermsof pymntfor forigntrd

the goods b an inspetion ompany before the are 2. Th arrier givs th

dispathed. The inspetion ompany will then seal nessar shipping dou-
th goods and issue an inspetion ertifiate, whih mnts to the sllr nd
-\
has to be sent to the olleting bank with the trans- transports the goods to th ^
port douments and the sight draft. buyer's ountr.
FN
ash against
douments (AD)
oaa o oye
'oIIToB 3. The sllr ollets t
)fi
dournents against oyNIeIII IIoe ollal th other shipping dou-
paymnt (D/P) mnts and gives them to
transport douments TpaopTIIa oll\{e- his bank (the rmitt- L RlllN
a'f aaa ing bank) together with
remitting bank a-ae a TIME DRAFT.
'\3S BAIlI/

olleting bank
erishable goods
to dispath
a.oaeJI
ItopoopT
oTIIpaBT;
ToBap
oTpy}Ia
I
to seal oeaIBa
to issue BIaBa
4. Th rmitting bank
snds the douments and
Douments against aptane (D/A) draft to the olleting bank
(the buyr's bank). The
This term of payment is vry similar to CAD. Ho- buer is notified to whn
wever, instead of sending a sight draft to his bank, they arrive. oLL|
the seller sends a time draft. In order to get the
transport douments, the buyer only has to aept
the draft. At maturity, he goes bak to his bank and
pays for the goods.
A D/A transation is therefore effted as follows: 5. The buyer goes to his
bank and aepts the time
draft. In return, he is gi-
ven th transprt dou-
1 . T h e s e l l r sends the ments and an ollt his
goods to the arrier. goods.
72 V. Termsof paymentfor f oreigntrde 7
ommeria|
nq|ish

6. At maturity, the buyer

opening/issuing bank a-
goes bak to his bank and
advising bank a, poo
pays th bill of ehange. BIIIa o ape'TBy
The mone is sent from th eap' Iloya
bnefiiary
oLLtt{ ollting bank the remit. o apeI.rBy
ting bank and rdited to rdit oelrapI
doumntary
the sellr's aount. aIpB

Types of letter of redit

Obviously this is more favourable for the buyer than
CAD, as he an take possession of the goods before
paying. However, D/ carries a onsiderable risk for
the seller: if the buyer fails to honour the bill of ex-
hange, the seller probabl won't be able to reover th
goods (two or three months may elapse between the
time the draft is aepted and the time it matures, in
whih time the buer may for example have sold the
goods on). Moreover, taking legal ation to reover the
money is far more diffiult on an international basis.
Letter of redit
A letter of redit is a promise made by the buyer's
bank (the opening or issuing bank) to send a ertain
sum of money to the seller's bank (the advising bank),
to be redited to the seller, known as the benefi-
iary, provided he fulfils his part of the sales on-
trat. It is also known as a doumentary redit.
doumentsagainst oyeIIIoIIp}ITIo;
aptan (D/A) Ilpeaa IIpaBa oe-
o oe IIov
ea oaTe
letter of redit (L/) apeTB
1. A revoable letter of rdit an be anelled or
hanged without the seller's agreement. As this
doesn't offer the seller muh ontrol over pament'
this type of letter of redit is rarely used.
2. ,\nirrevable letter of redit an be anelled or
hanged, but only with the agreement of all parties.
All letters of redit are irrevoable unless expressl
stated otherwise.
3. A onfimed letter of redit is always irrevable.
If the seller feels that the risk of not reeiving pay.
ment is still too high, for exampl beause the buy-
er's ountr's eonom is unstabl, h an arrange
for a bank in his own ountr to onfirm the letter
of redit (this bank is then known as the onfirming
bank; it an be the same bank as the advising bank).
This means that the seller will reeive his money
from the onfirming bank, regardless of whether r
not his invoi is paid in the buyer's ountry.
revoable oro
irrvoabl orr
onfirmed oBep}I{er (ap)
unstable eour, ear
onfirming bank a, oBep}I(aro
aIpTI{B
74 ommeria|
nq|ish V' Termsof pamntfor foreigntrade

Payment by letter of redit is effeted' as follows:

5. The sller hks that all

the terms and onditions ar
1. Buyer and sller agree
orretly listd in the L/C.
on all terms and onditions
o f th e s a ] s o n t r at.

6. The sellr ollets all the

'*N
nessar transport dou-

2. The buyer fills out an

ments.
*) ,V
9
l
appliation form to open
a lttr of redit at his

eB
bank.

I 7. Th sellr givs the trans-

w
port doumnts and a sight
or time draft to his bank. He
an get his rnone now if
3 . T h e o p e n i n g (buyr 's) the L/C is onfirmed.
b a n k p e n s th letter o f
redit and sends it to the
advising (sller's) bank. If
a p p ro p ri a t e , t h o pening
bank also asks the onfirm.
ing bank to onfirm the
L/C . 8. The advising bank heks
that all th douments ar
lffi
orret and sends them to
Jlt
,l t t,
4. The advising bank tells the opening bank.
(advises) the sller that the

t
letter of rdit has been

I opened.
76 ommri|
nglish
V. ermsof pymntfor foriqntrad 77

9. The opning bank heks

ROYAL BANK
th douments again and LERo REDI
London.ng|and
sends the paymnt to th
AppIint Benefiiary Advisingbank
advising bank.
Shahlmporto' Rj ahTao mpan y Bank
Ang lo- lnd ian
176StpnyRoad 65 GandhiRo d Governor's Bldgs.
LondonS27HLU K Bomby297645.Indi Bomby27645.lndt
Refreneno. Dt and ple Datnd ple
HtD59765 of issue of expiry
20 June1999.London 21 Ju|1999,
Bomby
ranshipmnt Amount
DVl5lN6 [ ]A I lo w ed[x ] No t s./5.UUU (5vntv -TlV
nousn0 rup sl

t
BNk allowed redit avilablwith
Parti|shipment Ang|o-lndin Bank,Bombayby ngotition
[ ]AIlowd [] Not ginstth douments nmdhrinand bn-
lIowed draftat 60 dayssightdrwnon Roy|
fiiry,s
10. The buyer pays (sight Bnk,London.UK
draft) or aepts th draft Shipment/dispath tor trnsporttionto Not |terthn
(tile draft) and gets the f rom Londn 6 July1 9 9 9
oPNlNG \ shipping doutnntsin r- Bombv
8Nl{ turn. With tlrs, he an t Doumentsto b presentd
ollet the goods from th I ]. ommril invoi L/ numbr
in 6 opisinditing
l 2' Ful|setof Ianbrllsof |dingmdout to ordrof issuing bankof
\ arrier in his ountrv.
L/ markdprpaid and notifying alsoindiating
applint thtsL/
numbr
l. . rtifiatof origin
.l. ] 4' Paking list
Exeis Look t th letter of rdit blow nd nswr
the oustions^ I
p These doumentsto be presntedwithin ..'.'days of the issueof
'1.Who is the buyer? th trnsportdoumentsbut within the va|idityof the rdit.

2. Who ls the s||er? |nstrutionsfor dvisingbnk

3' Whih is th openingbank? P|eseadvise benefiiriesof the openingof this redit.adding
4' Whih is the advisingbnk? your onfirmtion'
5. What kind of lttrof reditis it? Method of reimbursement
w wilIrimburs
At mturity you aordlng
to oUrtnstruttons
6. Wht kindof draft wilIb tthdto the trnspotdou. DoumentsshouIdbe forwrded to us by air mi|.
mnts?
Jans "4dtso
for ROYAL BANK
 ommeri|
ngIish

Questions for revision

1. xplain the diffrenes and similarities btween

CAD and D/A. Vl. Terms of delivery (lnoterms)
2. What are the advantages and disadvantages of
CAD for the buyer? 5 EXW (ex works)
3. What are the advantages and disadvantages of 5 |notrmsfor shipping
D/' for the sellr?
5 |notrms transport
for mu|timodal
4. Using our own words, desribe the proess of
5 ovring
lnotrms paymentof duty
paying by letter of redit.
5 Questionsfor revision
5. Whih of the various terms of payment for fo-
reign trade do you think is the safest for all parties,
and why?
 !
VI.erms of delivry(|noterms)
;
$ -./*--::]]:\ -//-**::...
$ALL*.s l BUyR,s
AToRy 2'
lwRCIUgA
....-:---..-......""*

t t
t. spt 6. gpt

When goods are sent from a seller to a buyer, eah o55 s5

party has to know exatly whih of the osts and
risks of transportation he has to bear. In order to
avoid disagreements, the sales ontrat usually stipu-
lates one of the thirten terms of deliver drawn up
by the Chamber of Commere. These are known as t. Ll '5. U$rpttts
inoterms (Intrnational Commerial Terms). They
determine whih party is to bear the various osts
involved in transportation and the point t whih
the risks are to pass from the seller to the buyer
ft
RF
(known as th passing of risk). sl{l.1N

xw (e works)
1. The ost of transporting the goods from the sell-
This inoterm rersnts the maximum obligation er's fator or warehouse to th ort of shipment,
for the buyer: the seller has the glods ready for ol. from rvhih the are to be shipped abroad.
letion at his fatory, and the buyer has to over all
2. The ost of loading the goods onto the ship at the
osts and bear all risks until they reah his ware-
port of shipment.
house. It an be used for all forms of transport.
3. Freight osts - the harge made for arrying the
passing of risk epeo' IIpaa pa goods on the ship.
ex works pao-ao
fatory ao; apa
4. The insurane osts inurred while the goods are
warehouse a being transported.
5. The ost of unloading the goods when the ship
reahes the pot of destination in the importing
Inoterms for shiping ountr.
When goods ar to be sent by ship, the following 6. The ost of transporting the goods from the port
osts have to be paid: of destination to the buer's warehouse.
82 ommerialnqIish Vl. Termsof delrvery(ln(otrms)

port of shipment op opa CFR (Cost and Freight)

to load oTpydaT
freight pa; p The seller pays for the transportation of the goods to
insurane paxoBa; TpaxoBalle the port of shipment, loading osts and freight.
to unload papy}a
port of destination op aIIaeII That means the buer pas for insurane, unloading
and for the goods to be transported from the port of
FAS (Free Alongside Ship) destination to his warehouse.
The seller pays for transportation of the goods to the The passing of risk is the same as for FoB (when th
port of shipment. goods pass the ship's rail at th port of shipment).
The buyer pays for everthing else (loading, freight,
insurane, unloading and transportation from the port CIF (Cost, Insurane and Freight)
of destination to his
The seller pays for the transportation to the port of
warehouse).
shipment, loading osts, freight and insurane.
The passing of risk o.
urs when the goods have
That means the buer pays the unloading osts and
been delivered to the
for the goods to be transported from the port of des-
quay at the prt of ship- tination to his warehouse
ment.
The passing of risk is the same as for FOB and CFR
FOB (Free on Board) (when the goods pass the ship's rail at the port of
shipment).
The seller pays for the transportation of the goods to
the port of shipment and the loading osts. DES (Delivered ex ShiP)
The buyer pas for everything else (freight, insur-
The seller and th buer share the
ane' unloading and transportation from the port of
osts exatly as desribed under
destination to his ware-
CIF"
house).

The passing of risk o- The differene is in the passing

urs when the goods have of risk; this ours after the ship
passed the ship's rail at has arived at the port of desti-
the port of shipment. nation but BEFORE the gods are
unloaded.
 (|noterms)
VI.ermsof deIrvery 85
ommi|
nqlish

DES (Delivered Quay) I pid for the goods to be transportedto th doks and
loded onto th ship. | lso gred to py th ost of
The seller pays for the gods to be transportd to the rryingthe goods arossthe Atlnti.
port f shipment, loading, freight, insurane and h importeronIy hd to pay for th goods to b trns-
unloading. portedf rom Rotterdmto hiswrehouse.I prdfor vry-
thinge|s.
Gs The buyer onl has to pay for
\ / the goods to be transported
\ / from the port of destination to Inoterms for multimodal transport
his warhouse.
The next three inoterms an be used for all frms
The passing of risk ours af- of transport inluding multimodal (for example road +
ter the goods have bn unload- * air, train + ship). The osts and responsibilities to
ed at the prt of destination. be shared are slightl different fror the shipping
inotrms:
Free Alongside Ship pao Bo opa ya
qua
Fr on Board
pa
+ -.*-*\
]sLLRr 2' rrrp
#---r>
pao op a, o
ship's ail pa yIIa; ep , *_\*
Jg{r Frs
it 3. Ftc
d;
@

Cost and Fright ToNIo pa 4. lgun*s

Cost, Insurane ToI{IvIo'TpaxoBae
and Fright pax
L;}#
Dlivrd ex Ship oTaBa a op opa 1. The goods are delivered to the first arrier.
Delivered ex Quay oaBa llpay
2. organisation of transportation to th buer's ware-
xerise
]. | m a BritishXporte. house and payrent of the osts inurred.
What Werethe ino.
temsher? ..arriage'')- the harge
B. Freight osts (here alled
,l' made for arring the goods.
I paid fo th goods to b transportdto the doks at
Harwih. Afterwrdsthy bemthe buyer,srsponsibiIity'
4. organisation and pament of insuane for the
2. I mad the goods radyfor oI|tion, but the buyehd
journey.
to do everything|se'
' I paid a||the osts invo|vedin gettingth goods to Spain, FCA (Free Carrier)
but |ft th osts of un|oadingto th impotr'
4' I paidalIthe ostsinvo|vd in gettingth goods}o exio, The seller dlivers the goods to the first arrier (this
but the buyetook ovr the riskf rom th time th goods is the point at whih the passing of risk ours).
were loadedonto the shipin London.
5' I pidf or th goodsto b transportedto Dovrnd loadd
The buyer arranges and pays for transportation,
onto the ship,but that Was l|' freight and insurane.
 ommri|
nqlish VI.erm5of deIiver(|notrms)

CPT (Carriage Paid To * named destination)
The seller delivers the goods to the first arrier (at
whih point the passing of risk ours) and pays
freight harges.
The buer arranges and pas for transportation and
insurane.
risks until the goods reahed a named point at the
frontier.
The buyer pas all sts and bears all risks involved
in transporting the goods from the frontier to his
warehous. He also pays duty.

CIP (Carriage and Insurane Paid to * named des-

tination)

The seller delivers the goods to the first arrier (pass-

ing of risk), pays freight harges and arranges and
pays for insurane.

The buyer only has to arrange and pay for transpor-

tation. DDU (Dliverd Duty Unpaid)

multimodal transport paoppoao. The seller pays all transportation osts and bears all
IlvIBa}I paEIIopTa risks involved in getting the goods to the buer's
F'ree Carrier ool IIepeBo warehouse.
Carriage Paid To epeBora oIIaeIIa o
Carriag and Insur. epeoa Tpaxoa The buyer only has to pa duty.
ane Paid to oIIaeIII o

Inoterms oveing payment of duty

\ sLLLR,s R,s
BUY
The last three inoterms are used in the ase of trans-
portation through a bode (although not within the J ro1 wlioU5

uropean Union) where duty has to be paid. They

an be used for any form of transport. 5rlg'l l.s

DAF (Delivered at Frontir) DDP (Delivered Duty Paid)

This inoterm is most ommonly used for overland The seller pays all osts and bears all risks to get the
transport. The seller overs all osts and bears all goods to the buyer's warehouse, inluding paying
 *

!
ommeri|
nolisl' V|.ermsof delivery(lnoterms)
*
duty. This inotrm onstitutesthe seller,s
maimut Groups of terms
obligation.
The thirteen inoterms an be divided into four groups
aording to the first letter of eah:
. .' terms (EW): the passing point of ost and
risk is when the goods leave the seller's premiss.
. .F' terms (F'A' FAs, FoB): the buer pays the
freight (arriage) osts.
. .C' terms (CFR, IF, PT, CIP): the seller pays
$LLEnss o915,Rl5l{5{ri DurY the arriage osts
..D' trms (DAF' DDP, DDU, Ds' DEQ): the
duty passing point of ost and risk is on arrival in the
oIIIJla
border, frontier buyer's ountry.
paIIa
Delivered at Frontier oaa o palrI
Dliverd Dut Unpaid oIaea oaBI{a. Questions fo revision
e orr
Delivered Duty paid oaa oTaIa
1. Using our own words, explain the differenes and
olua similarities betrven:
. CIF and DES
erlse 2. Whih inoterm Was Usd . DES and DEQ
in ah as - . DDP and DDU
A, P, lP, DAF, DDU, DDP?
,1. . FAS and FOB
When we importd-shirtsfrom the US,
we on|y hd to . CRF and CIF
organ|setrnsportation - the ompnyin New York did . CP and CIP
verythinge|se.
2. We offered ou ustomerin Brzrlvery
fvourblterms 2. Arrange the interms in order beginning with
of dlivery;h on|yhad to py duty.
^ l rrangd the most favourable for the seller and ending with
. for the goods to b snt s far as the
ftr tht, it ws up to the importerto do
bordr; the least favourable.
verytr.rlng
.i;'
4. We didn,thav to lift finger - th 3. For rryhihinoterms does the buyer have to pay
exporterdid every-
thingI insurane?
5 W hd to arranglnSUrn s wel|s py|ngto transport
th lst lod of goods w imported. 4. For whih inoterms does the seller have to pa
6. I sent th importrthe nssryinformtion
about the
freight?
rriaghrges h had to py, nd he
ognisedlnsur- 5. Why do you think speial inoterms are neessary
ane and tansporttion himse|f.
for shipping?
Vll. Transportation
5 Domsti and onshipping (the goods) to the onsignee (the person who reeives
5 Rodtrnsport
5 Railway transport
5 Air trnsport
5 Questionsfor rvtsin
A good transport sstem is needed if goods are to be
traded effiiently. A onsigner (someone who dis-
pathes goods) an hoose to send his onsignment
the goods) by:
. Water, whih overs both domesti (national) and
oean (international) shipping
. Land, by road or by rail
. Air.
When hoosing the most suitable form of transport,
the onsignor has to onsider:
. What kind of goods are to be sent - perishable
goods have to be transported more quikly than non-
perishable goods, for example.
. The plae of destination - not all destinations
an be reahed by all forms of transport.
. The ost of eah form of transport, how fast it
is and how safe. The onsignor may have to deide
whether speed is more important than safety, for
eample.
Types of argo
When goods are being transported, the are alled
..argo'' or ..freight''. Cargo
an be divided into three
ategories:
. Geneal argo - goods sent paked in boxes,
ases' hests and other ontainers.
. Bulk argo - large quantities of itms suh as
sand, grain and oal when sent unpaked.
 ommeriI
nqlish tI
I
TI
I
I
Vl|.ransporttion
93

. Bulky argo - large individual items stlh as I.

It Domesti shipping
ars whih have to be sent unpaked. P Domesti shipping runs on inland waterways
suh as

py3oopaBT * rivers'lakesandanals.oneimor tantserviero-

onsrgnor feder servie,
onsignment p; Irap oapa
If, vided by domesti shipping is the
to tlre
onsigne polloa I whih brings goods along inland waterwas
loaded diret-
international quays where they an be
t
general argo erarr py; opI py f
bulk argo
bulky argo
aro py
poo py
I
t
f
ly onto oean-ging ships for transportation
This saves onsiderable time and effort ompared
abroad.
with
rail and
t
transporting gools t th port b road or
then ringing them to the qua for loading.
Dmesti and oean shipping
I
lLwy
ffi*
t
Whn sending goods by ship, the arrier is the ship- I

I

I
ping line. Like all other forms of transport, ship-
ping has rtain advantages and disadvantages for
f;

ffi
t,
the onsignor and onsignee:

It is th heapst form
of transport ovr longer
It is the slowest means of
transport.
s )-_
distances. It may be subjet to delays o.nPRp
The ports of a ountry nd wather onditions.
may b aessible ven Th ntwork of inland wa.
whn foreigners arn't trways is rlatively limitd.
allowed into th ountrv
It may be neessar to
itself.
transport the goods a long
Unlimited distanes an
be ovred (e.g. betwen
distae to reah a port.
Th insurane osts are rla-
Rrv s*
ontinents).
tively high.

The transport doument used speifiali for domes-
the
Larg quantities an be
t ti shipping is the rive bill of lading (also alled
transportd.
inland waterwaYs bill of lading)'
L

1:
I
 95
VlI.rnsorttion
94 ommrilngIish

Advantages and disadvantages of road transport:

shipping line II lvlop}x IIepeBooI
feder servie y}fia .oa
iver bill of lading alaa peIIIx
It is very fast over short dis- Only small quantities
IIepeBo3o
tans. an b transported.
oean shipping The extensive road network Ther is a relativel
means that most destinations high risk of aidents
The goods are transported on the open sea or oean. an be reahed. and delays through
traffi jams.
There are several types of sea-goingl ship whih ar- It is relatively seur - even
valuable items suh as ash It is expensive and
ry argo: reserves an be transported time-onsuming over
. Liners sail on fixed routes and keep to a shed- longer distanes; in-
by speialist ompanies
ule. They mainl transport general argo. terontinental trans-
Door-to-door transPortation portation is virtuallY
. Tramps take any argo they an get and sail to minimises the need for han- impossible.
any port required. Th do not follow a shedule or dling - goods onlY have to
any fixed route. be loaded and unloaded on.
. Coasters travel from one port to another along
Another advantage of sending goods by road (although
the oast of a ountry. They are not used for inter-
it is also possible with other means of transport) is
national shipping.
the opportunit of using a grouped onsignment
The transport doument used speifially for oean servie. If a trader only has a small quantity of ar-
shipping is the oean bill of lading. go to send, he an ollaborate with other sellers with
small onsignments all going to the same destina-
linr aep L
C
$r"r.e*
tramp pyoo apoxo &

oaster aoaroe yIro

{i

{
ffi
I
oean bill of lading aIaIIa lvlopI{x i
tl
epeBo3oI{ x

t
i
I
I
t
Road transport t
Goods rvhih need areful handling, suh as fruit,
*
are often sent by road, as the only need to be loaded i
{..*
and unloaded one. Normall they ae sent as gene-
E
ral argo. The arrier responsible for transporting
goods by road is the haulage ompany. t;

i
it
 r1
ommerilngIlsh i VIl.Trnsportation

tion. The various part onsignments are then sent

together as one whole onsignment, whih redues
I' RailwaY transPort

the transport osts for everybod involved. If goods are transported b train, the arrier is the
lr railway ompany. The prie of railwa transport de-
one of the people who organises grouped onsign- i pends on how fast the goods are to travel: the slow
ments is the forwading agent. He is th intermedi.
ary between the buer, seller and arriers:
t goods train is heaper than the passenge tain, and
the express train is the fastest nd most expensive
I of all.
t ; Advantages and disadvantagesof railwa transport:
l
l* Virtuall all typs of argo an Th railways ma
,i be transported. be affted by
t strikes.
other servies rvhih he provides are delivering goods li Virtually any distan an be
i1
covrd. Ther is a rlati-
from the seller to the arrier, tansporting goods I
vel high risk of
with his own lorries, arranging speial pakaging and
providing storage spae for goods whih are to be
't Large quantitis n be trans-
portd.
thft.
i.
dispathed at a later date. .he transport doument needed for railway trans.
The transport douments essential to road transport t port is the ail onsignment note.
I
are the international onsignment note (CR) if
a haulage ompany is used, and the Forwading t railwa Ompany o}raII }t(ee3l{oopo)tt -
ItIx epeo3oK
Agent's Certifiate of Reeipt (FR) for transporta-
goods train oapr oe
tion by a forwarding agent.
passenger train aa}Ip o
xpress train oe3.pe
haulage omany oftra aeIx
IIep03o rail onsignment not IIaa.I{a Ilepo3o
reeo opoo
groupedonsignment optooare
forwarding agent eTop
intermediar opeIiIt
onsignrnnt not pyoBa IraJIaa Air transport
Forwarding Agnt's a peII{
Crtifiate of Reipt llopolvl L Air transport is hosen when the goods are valuabl,
fragi1e or urgently needed.The arrier is the airline.
4 - 1066
98

Advantages and disadvantages:

ommerilnglisi I
le
Vll. rnsporttion

5. A argo of timber (wood) from Germany to Eng.

99

land via Rotterdam.

6. A onsignment of diamonds from Cape Town to

Air transport is fast. It is relatively xpensiv. Cairo.
It is a sur form f It is subjet to delays and
transport, whih ?. A large onsignment of oal from Sheffield to Leeds
strikes.
rneansthat insu- (both in th north of ngland).
rne osts are low. It is not pratial for short dis-
.l'hris no
tans. 8. A argo of bananas from the Caribbean t Dublin.
limita.
It rnay be neessary t send
tion as to distane. 9. A larg onsignment of lorries from London to
th gods som distane to reah
the argo terminal of an airport. Warsaw.

The transport doument neessar wlren goods ar 10. A small onsignment of heese from Srlitzerland
dispathed by air is the air waybilt. to the USA.

airlin aBaJIIItIvt
airwabill aapyoaIIaIa.a
t$
I
{
Questions for revision
Whih form or forms of transport would ou hoose
for the following onsignments, and why? What kind t
{,
!
of argo is involved in eah ase? *
r
1. A large onsignment of ars from Hambug to
r
Dresden. {
2. A small onsignment of flour fronr Wales to Lon-
don.

3. A small nsignment of hina from London to

Mosow.

4. An urgently needed onsignment of tea from Bom-

bay to Boston.
 !
'f
,t
s
;
*

Vlll. Export douments
5 Theoanbillof ldino
5 Air wybi|l
5 ommerial invoie
In the last hapter we mentiond some of the most
essential transport douments, inluding the bill of
lading and the air wabill. We will now look at these
and some othes in mor detail.
Th oean bill of lading

;$
5 Po-forma invoie I
{
As we know, this doument is issued when goods are
5 ustomsinvoi sent b sea. There are normall three oiginals.

5 onsularinvoi A bill of lading serves a number of purposes:

. It is evidenethat the shipping line has reeived
5 rtifit
of origin I the goods (it's the shipping line's reeipt).
'{
5 Qustionsfor revision f
. It is evidene of the ontrat between the ex.
porter (shipper) and the shipping line.
i*
. It dumentsthe shipping line's promise to hand
I
r ove the goods to the holder of the B/L at the port of

f
1
destination.
. It is a doument of title - evidene of owner-
t ship of the goods.
g
F

+
A bill of lading an also be negotiable, whih means
it an be transferrd to a third party along with
ownership of the goods, provided it is endorsed.
How is a bill of lading issued?
t 1. The xporter gives the goods to the forwarding agent
for transportation to the port of shipmnt. He also hands
I
over a shipping note (in the ase of goods whih aren't
dangerous; other''vise h hands over a dangrous goods
note or DGN). The shipping note provides the port autho-
104 nglish
ommeri| V| | l .x po r tdo um nt s r05

7. The shipper then arrang- oen Bi|Iof Lading

s for th bill of lading to Negotib|e
b sent to the importr or Exportr
, t h e i m p o rt r ' s b ank, de-
GraysonrmisLtd. NEvRslNK
p n d i n g o n t h e tr ms o f 2 PottrsLne
StffordST]4D slPPING
LlN
payment. on he has the
GRA BR|A I N
bill of lading, the importr
an ollet his goods frorn onsignee B/L no. No. of origin|s
to ordr D19762
the port in his ountry.
xportr,s
ref. Vessel
ur 001 SS Unsinkable
shipper opaBTe Port of loading SaiIingdt
shipping note yBeotvlell o opye arwih, GB 22 Mrh2000
dangerous goods note yBeo}lIle o opy Port of dishrg EA
a
oaoo py3a H o usto n.
US 4 Aorrl2000
b
tallyman opop & Notify Freight
Mate's Reeipt Iypalra paa Unitedlmporting
,]44,1
In. [x]Prpaid
BahDriv [ ] o|lt
lan vl, B IIop I
Houston,X 28736
dirty pr, IIe B ope u.s.A.

.l. I No. okaoes l Partiu|ars
,]5
of qoods Wiqht Quntity
xerise B|ow is an xmp|e of bil|of lding. Look 15pakgsStttordshtr 00
|
at it and nswer the questions. l 0|nner
srvIs
,l' Total: 1200KGN/ 00
Who is the shippr?
Aptdby th rrirfromth Xporter in pprntgoodordrand
2. Who is the arrir? (un|ess
c ondition otherwisnotdhrin) th tot|numbrof quntity o{
. Who is to reeivethe goods? ontinrsor othrpakgs or unitsindiated
bov,sttedby th x-
4. an this bi|Iof ladingbe trnsferredto a thidprty? ! portrto ompris th goodsspifidbovfor rrigesubjetto l|
5. Whr is th port of shipmnt? * th termshroffromthe p|aof ptn or portof loading to th
6. on whih date are the goods to Ieavethe port of ship- il
.i plaor portof dIivry,
whihvr pp|iab|.
ln aeptingthisBilIof
T
ment? d Ldingthe mrhnt agreesto b boundby a||itsonditions,exptions
or provisions, printdor stampdon th f rontor bak
j

* whtherwrittn,
7. Where is the port of destintion?
u hron.
B. on whih day wi|lth ship probab|yarriveat the port of i
destintion? v |NW|TNss whreofHR() originI Bs/L
f hvbnsignd,of not othrwisesttedherein,
9. Who is the py the freighthrges- the exporteror the
{ oneof whihbingaompIishdth othrsto
rmoorter? I b void.
.l0.
|s this bi||of |ading|anor dirty?
/kru:lch, 20 Jla'h 2000 |4ah snid|
PInd dtof issu Siqnedfor the Msterof th bovvss|
 ommerr|
nglish
Types of bill of lading
We have already seen that a bill of lading an be
lean (when the goods appear to be in good order
when loaded onto the ship) or dirty (when some of
the goods are damaged or missing). If the bill of
lading is dirty, the onsignee an refuse to take de-
livery of the goods. Furthermore, if the bill of lad-
ing is an essential part of a method of payment (for
example the letter of redit), the bank may refuse it.
However, there are also various other types of bill of
lading:
1. The reeived This kind ot /I is issued when
bill of lading: the goods have been inspeted
but haven't yet been loaded
onto the ship. Suh a b/l may
for example be neessary when
the ship has been delaed and
hasn't et reahed the port
where the goods are waiting.
2. The on-board In ontrast to the reeived b/l,
bill of lading: this bill of lading is issued for
goods whih have already been
loaded onto a ship. Banks ma
insist on on-board bills of lad-
ing as being safer than the re-
eived version.
3. The straight This kind ot /| can'\ be nego-
bill of lading: tiated. only the onsignee
stated on th b/l an take de-
livery of the goods.
4. The order bill This b/l an be negotiated by
of lading: endorsement. Banks onl usu-
ally aept order bills of lading.
V|l|.xportdouments
5. The through This kind ot /I is used when
bill of lading: the goods are to be transported
b more than one arrier. The
b/l is valid for the whole jour-
ney and prevents eah individ-
ua] arrier having to issue its
own transport doument.
Hgus uq Rl vl Ngw
#
6g
u
B/L
6. The ontaine This is used for the transporta-
goods
bill of lading: tion of ontainerised
(goods paked in standard-sized
ontainers whih are then
sealed and not opened until
they reah their destination.
These ontainers do not have to
be inspeted by the ustoms
authorities when rossing bor-
ders). Suh a b/l also overs the
road and/or rail transport ne-
essar to get the goods to and
from the ports of shiprent and
destination.
7. The groupage This /I is used for grouped
bill of lading: onsignments. The bill of lad-
ing lists the forwarding agent
rvho arranged the grouped on-
signment as the shipper, and
the forwarder in the importing
108 ommeriaing|ish VlIl' xportdoumnts 109

ountry as the onsignee. The 7

Goods Container Part-loads
forwarding agent then issues a shipped to be sent shipped
horrse bill of lading to eah of and waiting from London b red's
the exporters whose goods are to dpart to Paris via Forwarding
inluded in the grouped on- Dover Ageny
signment. The house b/l then and Calais
serves as the olletion dou-
ment for the importer.
Ai wabill
reeived b/l aaI{a a IIpoBpe}IIII'
Iro Ir lloprer py
Unlike the bill of lading, the air waybill isn't a dou-
on-board b/l IIaa'Ira IIa y3' IIprI- ment of title and an't be negotiated. However, the
r a op ya exporter has a right of disposal to the goods, whih
straight b/l MIIa IIaa.IIa means that on presenting his opy of the air wabill,
order b/l opeplla lla}aa he an stop the goods during their journey, have the
through b/l oa I{aI(aIIa goods delivered to a different onsignee from the
ntainer b/l a a a a p o o 3 onsignee mentioned on the air wabill, or have the
oBapoB oeepe
onsignment returnd. This is useful if the eporter
ontainrised goods py B oeepe
disovers after dispathing the goods that the on.
ustoms authorities Tao}I]I T
signee may not be able to pay for them.
groupag b/l opa IIaa
hous b/l I{ypeII aaIla The air waybill is made up of thre originals and
several opies:
Exerise2. What kindsof b/| are these? . original 1 is marked ..For arrier'' and is kept
,, by the airline one it has been signed by the onsign-
Consignee Bulk argo Case no. 5
P. Smith to be sent missing or or his agent.
or ordr from London . original 2 is marked ..For onsignee'' and trav-
to Copen- els with the goods.
hagen via . Original 3 is marked "For shipper" and is re-
Hamburg
turned to the exporter one it has been signed by the
airline.
Goods Consignee Goods
in Kiel P. Smith reived xerise3. Look at the air wybi||shown blow nd n.
awaiting in apparent
good ordr
swer the qustions.
shipment
1. Who is the onsignor?
2. Who is th rrier?
110 ommerialng|ish V| | l .x po r tdo um ent s

. Who is to reeivethe goods? Commrial invoi

4. Whih airportre th goods to Ievfrom?
5. Whih irportwill the goods rrtvet?
6. Wht does the onsignmntonsistof?
7. Whois to pay'n.
T:.:***'::]*
l
Sottishxporto. Ltd'
The ommerial invoie is the seller's formal rquest
for payment. Along rryith the transport doumnt, it
is probably the most important paper needed in an
export transation, as it is also an essential omp-
nent of ertain methods of pament (for example the
AI WAYILL
ioil !ooIA.LE
oNsloNulN !o.} letter of redit) and indispensable for ustoms pur-
'

999 PrineiStret,dinburgh MU AIRWAYS poses. Several opies are mad.

Bstof British The ommerial invoie serves the following

]
Grtnstr'
GRMANY
4100]|\z]nhenq|dbah purposes:
. It is a reord of the transation between the sell-
er and the buyer, listing details of the goods, how
muh they ost and how they are to be transported
. It is the basis on whih the ustoms authorities
assess how muh duty or ta is to be paid
. It is used to onfirm the value of the goods for
5 ses,|o|food produts
insurane purposs.

Pro-forma invoie

Unlike the ommerial invie, the pro-forma in-

voie is not a request for payment. Instead, it is
a.,sample'' invoie, whih may for example be is-
sued:
. When the buyer has requested a quotation
. When th seller sends the buyer goods on ap.
proval
. If the goods are to be sold by an agent, in whih
?. Shith
04 Mr 2000 A dinburqh ase the agent will need a pro-forma invoie in ordr
to be able to fix his own pries.
112 nglish
ommeri| V| | |x
. po r tdo um ent s 113

1. The porter bus th

right of disposal paBo paop}rIr
(oeo)
relevant forms from the
onsulate of the importing RUvl4}l
ommerial invoie opol v.aypa
tax ao
ountry loatd in his own oN5UL
ountry.
pro.fomainvoi lpeBapere
on approval otl&olue
agent aIl; peTaTe
2. The exporter fills out
these forms. This is no asy
Customs invoie task, s there may be up to
6 opies, and the all have
Some ountries may require the exporter to provid to be prfet - if anything
a ustoms invoie, a speial invoie for the ustoms has ben addd or rossd
authorities of the importing ountr. This invoie is orrt. th forms will b r-
vr sirilar to the ommerial invoie, but requires jeted.
additional information suh as the domesti valu
and export prie of the goods. With this informa. 3. The exporter takes
tion, the ustornsauthoritis an deide whether the a ollnrial invoi for
goods are admissible (whether the an be allowed the goods to be exported to
tlr Chamber of Cornmere.
into the ountry) and how muh duty is to be paid.
Here th invoi is stamped
A ustoms invoie may be required in the following on th revrs sid to on-
situations: firm the origin of the goods
. Wher the value of the onsignment is relative- (where the ome frm).
ly high
. Where speifi types of goods are being imported 4. The exporter then takes
. If the importer requires preferential teatment ll thes forms - plus any
others whih may be re-
by the ustoms authorities, for example a lower rate
quired - bak the to on-
of duty.

&h e
sulate.

d.\$^.
Consula invoie 5. Here th onsular invie
Cetain ountris, notabl those in South Ameriao is legalised by the onsul.

\ //r.
This means that the eport.
ma insist on a onsular invoie as evidenethat the
er has to swer to the a-
goods being imported are not over.pried. A onsu-
uray of the douments.
lar invoie is issud as follorvs:
114 ngIrsh
ommeri| Vll|.xportdoumnts 115

Certifiate of origin

The etifiate of origin is issued by the Chamber of

Commere as proof of where the goods were produed.
There are two reasons why a ertifiate of origin ri,s|etronis
196Burnside W
might be neessary:
Vnouver, B
. When there is a trade agreement between the ANADA , i r,d .- ' d -
.,' ".' - .|o' l .

',..";.i "-'., ..]ll..'l'*i:lJ1&**'"*,.

exporting and importing ountries. In this ase, if it
l)n)n
. .''4YYl'l.
"'-"","^'i

an b proved that the goods were made in the x- Air f reight

TokyoNrit
Airortof departure:
porting ountry, duty is harged at a lower rate or Vn(ouVr
Airportof dstintion:
possibl not harged at all.
. For politial reasons, to prove that importers
; mrked1-5of 5 ontining
5 kgs
aren't importing goods from ountries with whih Ishigwa
ompatmers,20 per
pkge
trading relatins are not desired.

ustoms invoie a[olella aaa

admissibl paspelelrI ( oy) l,; .i.4 '''.' A . .:,i
\;
( L..^

.F .162r
s ..".* ..d
preferential treatment peepear pe)lvl '-. lz \
.-
r
50 KG 20,000'00
.(&i.fii'.]idi,:.

onsular invoie oyJI o

;*-m-*;'' l
I

ovr-pried aBIIIIeHI{I(o.e)
I
origin poxolrtel{ I

to legalise aoa
' l)

r l e" di{L; il

ertifiate of origin epa

"..-
n ' io d ;liin n n d lig r ' . ln 9 L l q ' - a lln { ir lic h o ] i. d! {6..' t! la

i1
IIpoxoEt/eIrfl
r:*;r'ilf ;i:"1'1;...
""'
*li:j1l"*i-.
,,l!]Ft',c

xerise4. Look t the invoi b|ow and nswer th

i
L.!ai..rii.iqlo oi

following qustions.
.l.
Wht kindof invoiis it, and what purposdos it sve?
Questions for vision
2. Who is the seIlr?
. Who is the buyr? 1. What is a Mate's Reeipt?What is the differene
4. ow nd when ar th goods to b snt to nad? betwena lean and a dirty Mate's Reeipt?
5. Wht kindof goods r involved, nd wheredo thy om
f om? 2. Desribe the differenes and similarities between:
6. How is pymntto b md? . The reeived and on-board bills of lading
116 ommerilnglrsh

. The ordr and straight bills of lading

. Th through and ontainer bills of lading
. The bill of lading and the air waybill.

3. In whih ases would you issue a pro-forma in- lX. Customsand duty
voie rather than a ommerial invoie?
4. Whih different purposes do the ustoms and on- 5 ypsof duty
sular invoies and the ertifiate of origin serve? 5 a|u|ting
duty
5 ustomsprodur
5 Qustionsfor rVision

Ever ountry has to ensure that the proportion of
imports to exports has a positive effet on its eono-
my. Too many heap imports an damage a ountry's
eonomy' as sales of the ountry's home-rodued
goods will suffr. Too man expensive exports an
also be harmful beause few people will buy them.
Therefore, eah ountry has the right t impose duty
on imported goods in order to ontrol pries and pro-
tet its eonom.
Types of duty
Export dut
Export dut is sometimes imposed on goods when
they leave the ountry (for exanlple on oil exports
from Russia). However, this kind of dut is not om-
monly imposed beausein many ases it would make
the goods too expensive for the world market.
Import duty
This kind of dut is imposd on goods when they are
brought into a ountry. There are two types of im-
port dut:
1. Protetive duty: Protetive duty is imposed to
prevent home produers losing business beause of
heaper foreign imports. Importers in ltaly, for -
ample, may try to import shoes from South Ameria
as they are heaper than Italian shoes; this proess
l. ustomsand duty
is known as dumping. This, of ourse' would be
a threat to the Italian shoe industry. To prvent this,
the Italian government would impose protetive duty
on South Amerian shoes, whih would inrease the
rie so muh that they would no longer be able to
ompete with Italian shoes.
2. Preferential duty: Preferential duty is a lower
rate of dut impsed on ountries with whom there
is a trade agreement. Suh agreements may be bilat-
eral (between two ountries, suh as Germany and
Israel) or multilatral (betweenthree or more oun-
tries). Groups of ountries whih have multilateral
trade agreements inlude NAFTA (the North Ame-
rian Free Trade Assoiation, made up of Canada,
the US and exio) and ASAN (the Assoiation of
Southeast Asian Nations, made up of Brunei, Indo-
nesia' alaysia, the Philippines, Singapore and Thai-
land). This lower rate of dut is imposed to nour-
age importers to trade with the preferred ountries
rather than with non-member nations.
xise duty
The purpse of eis duty is to raise mon for the
government. It is imposed on ertain home-produed
produts suh as luxury goods, igarettes, oil and
aloho1.
home.produed goods oTeeTeI{IIIeToapI
to impose duty oaa oto
export duty opTlra oIIII{a
import duty Nlopa ola;
IIao I{a MopT
prtetiv duty poeoI{a oIIIIIa
 120 ommril
nolrsh lx ustomsandduty

dumping \tIIIl
Compound duty
prferential duty peepeaa oIIIa
Compound duty, also known as mixed dut, is alu-
tradagreement opooeoaIIIeI{r
lated using a ombination of ad valorem and speifi
bilatral opo
fators; both the quantity or weight and the value of
mu]tilatral ooop
exise duty
the goods are taken into onsideration. This kind of
ar op
luxur goods
duty is imposed on goods where the pries flutuate,
pe/eIpooIII
in order to prevent the amount of duty falling below
,l' a ertain minimum. For eample, duty may be im-
xeris What kind of duty do you think Ws imposed
in h se?
psed on tea at a rat of 70o/.of the value (ad valorem
.l. duty). However, if the prie of tea falls, steps must
An eportrrn Switzrlndsent a onsignmntof hse
to n importrin Swdn'
be taken to prevent the duty falling below a rate of
2. An importrin Japanwntd to buy heap amrsfrom $20 per 100 kg (speifi duty). If this happens, spe-
iwan' ifi dut will be harged in addition to the ad valor-
3. A group of Amrintouristsbought quntityof'expen- em duty to keep the duty imposed at the minimum
siveperfume whi|eon holidvin Fran. required.
4 A Grmntoboompnyimported igarsfrom ub.
An |ndiante ompnysrnt lrgquntltyof tea to ad valorem duty oIIIa ad valorem
E n q ln d. speifi(fixed)dut eeaoIIIJII{a
ompound (mixd) duty MIIIaIla oIIIIIa
Calulating duty
Duty is alulated in several Was: Customs produr
Ad valorem duty If the goods being imported or exportd ar duty-
Ad valorem dut is harged as a perentage of the free (if no duty has to be paid on them), the have to
value of the goods, i.e. the more expensivethe goods, be delared to the ustoms authorities but rvill be
the higher the dut. immediatel leared for further transportation. How-
ever, if the goods are dutiable (if dut has to be paid
Speifi dut on them), they will proeed through ustoms in one
Spifi duty, also known as fied duty, is alulat- of the ways desribed here:
ed as a fied sum of money pr unit of quantity or 1. The goods are transported to the ustoms offie at
weight, e.g. 5 nts per kilo, 10 dollars per 1000 units the border, the duty is alulated and the importer
t. pays it (or the eporter, depending on the trms of
 ommeri|
nglish |' Ustomsnd duty 12

delivery). The goods are then released for further
transportation to their destination.
B npel
been paid. This means the dut doesn't have to be
paid until the goods are needed (fr example when
the importer finds a buyer). In this ase, the import-
r proeeds as follows:

ffib* a) The ilnportr has his r RpR

goodsbrought to th bond- R|.{oU5
t \.,\
ed warehouse for storage.
k/
\
.1|lil
2. In the ase of ontainerised goods, the ontainer LjI-J
is sealed by the ustoms authorities at the plae of
departure, then transported to the ustoms offie at
the plae of destination. Her the ontainer is opend,
the duty is alulated and the importer pays it. This
eliminates the need for the goods to be inspeted at b) I n r tur r r , th w ae- BORDTR
ever border they ross. ho usman gives the im- Rtl]ou5
porter a bond warrant as
Bolr
a reipt for the gods. Th
Custs Cus.r's
1#s,y bond warrant is a negotia-
ble doument.

duty-free eorr
to delare goods eappoBaT ToBap
to lar goods through pooT aIotey
ustoms oIty
dutiable oaaer or
) Th importr tris to
3. The third possibilit is for the importer to store find buyers for the goods
while the are in bond.
the goods in a bonded warehouse, a speial ware.
hous where goods an be stored until the dutv has
124 ommerilngIish lX. Customsand duty 125

d) Should the potential bu-

r ned to se samples of bonded warehouse a\[o}IdeIIIII a

th goods whil th ar warehouseman ae/pao c|<JIaa

i n b o n d . t h i s n e dn't be bond warrant oyII o xpaeIr ToBapa

IIa JIa
a p r o b l e m . T h e i mpo r ter
goes to the warehouseman in bond axo Ir Tao,{eo
ae ; epaao}Itrrr
and obtains either a sm-
pling orde, whih enabls sampling order opp I{a Iloye opao

hirn to take away sampls inspetion order eorrr opep

of th goods in bond; or an dlivry order paop)rdel{e o BIa
i n s p e ti o n o rd e r, w hih oBapa o I(aa
nable lrim to take the po. ustoms prmit aIo)tIllloe papeIII}Ie
tential ustomer to inspet
th goods.

) one the importr has

found a buyer, he dorss
the bond warrant and hands
it ovr to th buer. If he
Questions for revision
1. Using your own words, desrib the different tpes
of duty. What purposes do they serve?

.}t
--\
has found several buyers, 2. How an dut be alulated? Why do you think it
(i
-/..r ah of them reives a d- is neessary to have more than one way of alulat.
[
q/ JYiyqysl
livry ordr .whih serves
t h e s a m e p u rp o s as the
ing duty?

\ .ffi: bond warrant. 3. What is a bonded warehouse, and what purpose

\'jP's l- f) The bur takes th bond

warrant (or delivry ordr)
does it serve?
4. A bond warrant is a doument of title. What does
bak to the bonded War-
house and pays th duty on
this mean?
t h e g o o d s . I n r tur n, he
5. Explain the differene between a sampling order
BoRDR reeivs a ustoms permit
and an inspetion order. Give some eamples of goods
whih means the goods an
for whih eah one would be appropriate.
/}d b released from bond.
\ A\ g) The buer then takes the
/l ustoms permit and bond
\\ wrrant to the warehouse-
\\)----
man, who hands ovr th
\'t"J goods in rturn.
X. Marine lnsurane arine insurane is the oldest form of insurane.
Bak in the Middle Ages, ships were the most im.
prtant form of transport, and thir argo ras
5 Prinipls
of insurn ften very valuable. Sometimes traders would even
5 Typesof insuran poliy risk thir whol apital with just one slripment. So
5 ypesof |oss somebody ame up with the idea of forming a group
to spread the risk - and marine insurane uras
5 Qustinsfor revision born.

Very generally, marine insurane works as follows:

lfisu*p4 lsuB Rrrve*

#: su'c
Lsg flOitNs ttl
Ft
,o''
'i:, --'#.
" r YI
\,
t ir'

,f};
..:,r
L1Jn
'Al.g

The ship and argo owners (the insured) eah pa

a perentage of the value of their goods (the pre.
mium) into a fund administered b the insurane
ompany (the insurer). Should one of the insured
then suffer a loss, he an laim ompensation from
the insurer for the loss; this means he will reeive
money from the fund to the value of the loss he
suffred.
128 ommerilng|ish X. Mrinelnsuane

quirements are fulfilled when the insurane poliy

insured 3apaoBar
premium is drawn up.
axoa pM;
axoo B3IIo Utmost good faith (uberrimae fidei)
insurer paxoBae
to suffer a loss oIIeT yr Whn somone fills out a form appling to take
to laim ompensation peoa BoMeeII out insurane, he is obliged to tll the truth about
the value and ondition of the goods to be insured,
Some of the risks against whih it is possible to take and also to mntion anything whih might inrease
out insurane inlud: the risk of the goods being stolen or damaged. The
. So-alled Ats of God suh as fire, floods, earth- ..utmost god
insurer apts the appliation in
quakes et. faith'' that all the details supplied by the insurd
. Loss of the goods through being washed ovr- are orret, and fixes the level of the premium
board aordingl.
. Damageto the goods,e.g. by breaking, bending et.
For his part, the insurer is obliged to deal fairl
. Damage to the goods b vemin suh a,srats and
with the insured, for exarnple by making all the on-
nli ditions of the insuran poliy lar to him.
. Loss of the ship on whih the goods are being
trarrsprtd,.g. b sinking r ollision with another Insurable interest
ship
. Loss of the gods through theft or non-delivry It is essential that the insured has an insurabl in.
terest in the goods to be insured: this means he has
Standard insurane poliies generall do not over
to suffer a finanial loss if the goods are stolen or
politial risks suh as war and strikes. However, it
damaged. Generally this means that you an take
may be possible to obtain insurane over of these
out insurane for our own property, but not for
risks by pying an extra or higher premium. someone else's.

At of God xo ee Indemnit
vermin BpeTe
The idea of indemnity is that if th insured suffers
over : IIoI{pITe
a loss, he has to be paid suffiient ompensation to
bring him bak to the same finanial ondition as he
was in before the loss - not more and not less (this
Priniples of insurane
doesn't apply to life or personal aident insurane).
F,or insurane to funtion properly, the insurer and This prevents people ovr-insuring their goods in the
insured have to make sure that ertain basi re- hope of making a profit.
5 - l0(rtl6
 1 0 om me rt| Fn lrl. . MrineInsurn 11

Subrogation insurane poli is ready. The following tpes of over

one th insurer has ompensated the insured for are available:
. Hull poliies over the ship itself, but not the
his loss, he has the right to reover the amount in
question from tlre party respnsible for the loss (for goods being arried.
. Cago poliies over the goods arried on board
example, if the insurer an prove that the ship was
not seaworthy, he an take legal steps against the the ship, but nt the ship itself.
ship owner). Voyage poli

insurance poli paxoo o' paxoa

This tpe of poliy overs the ship and/or argo for
utmost good faith lIooe oepe one voage only. This kind of poliy ray speify a date
insurablinterest paoo Irepe limit within whih the ship is expeted to have ar-
indemnity apall o yro rived at the port of destination. It is used b people
subrogation epexo IIpaB paoBa or ompanis who onl have to ship goods oasion-
Tpaxoy ally.
seaworthy or aBa
Time poliy
xeris1. Wht is wrong here? This is the type of poliy used most often. It overs all
1. Mr. Smith,sinsurnompanyrefusdto py him when shipments made within a ertain period of time. The
his houswas brokeninto,s they found out fom polie premium is paid in advane and then adjusted at the
rordstht it had alradyben brokninto twie befor end of the period of insurane, depending on the number
h took out insurane.Whv? and value of shipments made. The insured has the re-
2. Mary,s mother |ent Mry some pensivejewl|ery.Ho. sponsibility of filling out an insurane ertifiate for
WVr,when Mary app|iedto hveit overdby hr hous-
eah shipment, so that an aurate reord an be pre.
holdinsurne poIiy,
the insurne
ompanyrfused.Why? sented at the end of the period of insurane.
. Mr. Adms wnted to insure the goods in his wrhouie
for $200,000,whih was the priat whih he ouIdse|| Floating poliy
thm.Howvr,th insuranompnyto|d him tht thy
ou|donly insurthe goods for $12O,00O.Whv?

Types of insurane poliy

Written evidene of the insurane ontrat is pro- trr $*trn stp,r'*
vided in the insurane poliy. If insurane is needed *2AOO Jeso Jso
w0}i woRl{ \r/R|i
at short notie, the insurer an provide the insured sp qaoas r Apg or 6ps
with a over note to fulfil this funtion until the
 .l3
ommeria|
nqlish X' MrrnInsurane

With a floating poliy, the insured and insurer agree Types of loss
in advane on a ertain sum at whih the goods are
to be insured. The insured an then make as man As far as marine insurane is nerned, insurers
distinguish between total loss and partial loss.
shipments as he wants until this value has been
reahed, at whih point the poliy expires. 1. TOTAL LOSS:
Mixed poliy (a) Atual Total Lss (ATL)
This is a ombination of the voyage and time poli. An atual total loss is
ies. The ship and/or argo is overed for all voag- said to have ourred
es between two named pots for a ertain period of when the ship and argo
time (for example for all voyages from Liverpool to have sunk and annot be
New York over a period of one year). reovered.

over note BpelvlIloe paxoBoe If the ship disappears

BeeBo after leaving th port or
hull poliy
argo poli
o paxoa Ira
IIo paxoal{I{ pya
if it is long overdue, this
is also onsidered to b ?.
voyage poli IIo paxoall Ira epeoy an atual total loss. If the
time poliy o lra po ship then turns up after
floating poliy eI{epaJIIIril oc a laim for ATL has ben
mixed poliy eruar o settled, it automatially
beomes the propert of
xris
Z.Whttypeof tnsurane poliyWouldyou use the insurers.
in ehsituation?
Justifyyouranswer!
(b) Construtive Ttal Loss (CTL)
]' A ustomerin Sri Lnkp|aed tria|oder'

d9)
2. A ompny in nd rivda standingordr from A onstrtttive total loss 1\...
a ompanyin Boston. ours 'rhen the ship or
3. A arpetimporterin |t|yoften p|aesorderswith a ompany goods are so badly dam-
in Moroo.owver.s slesflutut,the size nd value
aged ttrat tlre ost of r-
of th orderstends to vry nd is not alwaysprditbl.
pairing them would be
4. An exporterin -Jpanws offred a on-yarontratto
suppIygoodsto vriousbranhesof n Amerianorpora- greater than their mar-
tron. ket value. It also ours
5' A famiIymigrtingf rom ng|ndto AustraIisnt most when a ship sinks and is
of theirhouseholdgoods by ship. left bause th ost of
 ommeri|
nq|ish X' Mrinlnsuran

thrw
reovery Would be too high or the risk to human life 5. A ship rryingorl brrlsughtfir,nd th rw
th balsinto the 5ato prvntan xploston.
too great.
6. Pirtsboarded ship nd stole prt of th argo.
2. PARTIAL LOSS:
atual total loss (ATL) ea
(a) Partiular average IIoIIa

onstrutive total loss (CTL) opyIIa

Partiular average o-
urs when the objet in-
sured is lost or damaged
beause of an aident,
suh as a fire or flood on
board the ship. The loss
is borne by the person to
whom the objet be.
longed.
(b) General average
General average ours
when the objet insured
is sarified. in order to
prevent a total loss; for
eample, goods may be
thrown overboard in order to stop a ship sinking.
The loss is borne by all parties - both the ship own-
er and the argo owners.
xeris3. What type of |oss ws this?
1. A ship disppard while silingthroughth Brmudri-
angre.
2. A shiprrylnghepgeneraIargosankloseto th oast fairer for the loss to be borne by all parties?
of Frn.
. wo boxs of goods wer lost overbords a esu|tof
bd wther.
4. | 1912,the supposed|yunsinkab| itnrhit an ieberg
nd sank in the At|nti.
oJIIa e
aa aap
partiular average
o aap
general averag
Questions for rvision
1. Desribe some of the risks whih an be overed
are
by insurane. Why do ou think politial risks
not usually overed by marine insuran?
of
2. Using your own words, explain the priniples
insurane. Wh are these priniples neessar?
poliy,
3. What is the differene between a time
a floating poli and a mixed poliy? Give some
prefer
examples of situations where the insured ma
to hoose one over the others.
give some
4. Desribe th two types of total loss and
examples.
5. Give some xamples of partiular average.
it is
6. What is general average? Wh do ou think
Xl. Businessorganisations Business organisations belong to either the private
or the publi setor. Th pivate seto onsists of
ompanies belonging to private individuals, and the
5 he privatesetor publi setor of ompanies owned by the government
5 hepub|isetor of the ountry.
5 Qustionsfor revision
The private setor

There are various types of business organisation whih

operate in the private setor:
1. Sole traders
A business run by a sole trader has just one owner,
who is entirely responsible for all the ompany's busi.
ness affairs. This type of organisation has ertain
advantages and disadvantages:

The sole trader A sol trader has to bear 100 %

doesn't have to f th risks inurred by his
onsult anyone else ompan.
when making dei- Fo this rason' he may have
sions. more diffiultis raising apital.
The profits do not A sole tradr has unlimited li-
have to be shared ability for his ompan' whih
with anyone else. means that if he goes bankupt,
h may lose both his ompany
and his personal property.
18 ommeria|
nglish X|. Businssorqnisations 19

. Limited or speial artnership, onsisting of at

private setor aIrI eop
publi setor oy/apTeliI eop least one general partner with unlirnited liability and
sole trader aTIII IIpIIpIIlvIae at least on limited partner whose liabilit is limited
apital aa; o; peBa to the apital he has invested. The limited partners
rrn]imited liability Heopaea do not run the risk of losing their personal property
oBeTI{IloT if the ompany gos bankrupt, but neither do they
bankrupt apo have an say in how the business is run.

2. Partnerships partnership ToBapeBo; IIapEepTo

ative partner ar aTLI
A business run by a partnership has two or more
sleping partner ar yaII
owners. When entering into a partnership, an agree- general (ordinary) otvrall llopao
ment is drawn up defining the rights, responsibili- partnership oTBeTBeIIoTI
ties and liabilities of eah partner, suh as how the limited (speial) Itolua opaeo
profits ar to be distributed and what part eah part- patnership oTeTTeoI (ooo)
ner is to pla in managing the ompan. The part- general partner ar aprrep
ners may be ativ, meaning that they are atively limited partner apep opaveo
involved in the ompany's business; or sleeing, whih oBeBI{IloTIo

means they invest money in the ompany and reeive

a share of the profits, but do not onerr.rthemselves 3. Joint-stok ompanies
with the ompany's business affairs. From a legal point of view, a joint-stok ompany
ounts as a separate peson, whih means that its
shareholders (owners) and diretos (the people ho-
sen by the shareholders to run the ompany) only
Z have limited liabilit. The shareholders eah reeive
z
,Ao
one dividend (part of the profit) per share. There are
two types of joint-stok ompany:
(a) Publi limited ompany (pl)

The apital for this tpe of ompany is raised from

tv** Slpl *t
members of the publi. For this reason' a pl an be
There are two types of partnership: listed on the stok exhange, although it doesn't have
. Gneral or odinary partnership, where all part- to be. Before it an start doing business, a pl needs
ners have unlimited liability. to have a minimum amount of share apital (in Eng.
 ommrilng|ish |.Business
oronistions 141

land for example, it needs to issue at least f50,000 private setor. This has both positiv and negative
worth of shares). aspets:

(b) Private limited ompany (Ltd.)

There are many more private limited ompanies than As firms ative in these As firms in the pri-
publi limited ompanies. The shares of a private privatised industries may vate setor are mainl
limited ompan are held by speiall hosen per- find themselves in ompe- interested in making
sons or ompanies, whih means it an't be listed on tition with other firms, it a profit, privatisation
the stok exhange. However unlike publi limited is in their interest to make may make ertain ser-
ompanis, private limited ompanies don't need tlre servies provided more vies more expensive
a minimum amount of share apital - it's theoreti- effiient, whih benefits for the ustomer.
the ustomer.
ally possible for a private limited ompan to har,e Neessary servies
just one share held b one person. The money raised an b may not be provided
used to redue taxes. beausethey aren't
joint.stok ompany ao}Iepa IoIa
profitable.
sharholder aIIoIep; Bae,e aia
Companies in the publi setor have ertain similar-
dirtor ,peTop
ities to publi limited ompanies. However, there are
dividend B.e.
a few important differenes:
publi limited oTpIa oluall opa-
. While publi limited ompanies are owned b
ompany rreo oeteIIoTIo
stok xhange pra the publi, publi setor ompanies are owned by the
share apital aoepr aa govenment.
private ]iited aa oNIaII opalr-
. The hairman of a pl is hosen by the share-
ompan eo oTBeTBeII}loIo holders, whereas the hairman of a publi setor om-
(Ltd.) pan is hosen by the government.
. A pl obtains apital by selling shares, a publi
setor ompany by selling stoks.
Th publi setor . The profits earned by a pl go to the sharehold.
As we know, firms in the publi setor are owned ers, the profits earned by a publi setor ompany go
by the gover]lment, one exarple being the post bak to the government.
. Where the main objective of a pl is to make the
offie. However, in ertain ountries, notably ilr
Britain, there is a trend towards ivatisation r largest possible profit, publi setor ompanies are
selling ertain government-owtred organlsations suh reated primarily to provide the publi with essen-
as the railway and telephone ompanies bak to th tial servies.
 ommrrl
nglish

privatisation IIpa3a
stoks (oyaper) errIe ya

xeris]. Wht kind of businssorgnistionmight ah

Xll. The stok exhange
of thes b - so| trader, a partnrship,
a pub|ior privtelimitedompny or pub|i 5 Shares
setor ompany?
,1. 5 -intrstsUrrtis
Fixd
A sma||ornershop.
2' firm of so|iitors. 5 Qustionsfor rVision
. h BritishBrodastingoportion(BB) in Britin'
4. A |rgeommerilbnk.
5. A publishinghouse.

Qustions for revision

1. If you wereto start a small businesssuh as a shop,
would you prefer to do business as a sole trader, or
would you go into partnership? Why?
2. Using our own words, explain the two types of
joint-stok ompan. What do ou think are the ad-
vantages and disadvantages of eah? Mention some
examples of joint-stok ompanies in your ountry.
3. Give some examples of publi setor organisations
in our ountry. What effet do think privatisation
would have on these organisations and on the servi-
es the provide?

As we saw in the last hapter, shares sold b publi
limited ompanies an be listed on the stok ehange.
The stok exhange is the etrt of tli apital mar.
ket, where large quantities of apital are raised for
ompanies and the governmelrt. This apital is raised
in two ways:
. By selling shares to investors, whih means that
the investors beome part-owners of the pubii li-
rited omany in question.
. B obtaining loans from investors, in t}re form
of government stoks and debentures.
These shares and loans ar olltivl known aS se- Prefeene
urities. Th stok exhange itself doesn't own an shares
seurities; it is simply the market where seurities
are bought and sold.
apital markt pIo }aIlaa
govrnnrent stoks oyapTBeI I{III
OyIa
debenture .ooBoeoaeo;
o0aII
surities III ya
Shars
The stok exhange itself isn't open to ordinary in.
vestors; instead, tlre have to buy shares via a stok-
boker. Many banks and finanial institutions offer
this srvie in return for a ommission.
l I 'T he s t o kex ha ng 145
Types of share
There are a number of different types of share:
ordinav slraes T'irese are th most ommon
shares, also known as equities.
The ordinary shareholders bear
the largest part of the risk, but
the eturns an be muh higher
than with other forms of invest-
ment. Ordinary shareholders are
entitled to one vote per share,
whi]r gives thm more sa in the
running of the ompany; but the
amount of dividend they reeive
(1f any) is determind by the
onrpany depending on how muh
profit has been made.
These shares have a fixed divi-
dend whih must be paid before
the ordinary shareholders an re-
eiv their dividend, whih gua-
rantees a return on investrnent as
long as the ompany is making
a profit. However, if the ompany
doesn't make a profit, the prefe-
rene shareholder will not be paid
his dividend either. Unlike the
ordinary shareholder, the prefe-
rene shareholder is not ntitled
to vote in ompan matters.
Cumulative This is a speial lass of prefe-
preferene rene share whih offers a safer
shares retnrn on investment. This is be-
ause if th olrrpan annot pay
the dividend one ear, the out-
starrding amount is arried over
 ommerilngIish Xll. he stok ehange

to the following years. That means . Bulls buy shares expeting pries to rise.
that rathr than losing his divi-

i)
dend in a year where the ompany z{-\--*'
runs at a loss. the shareholder an
expet to reeiv it one or more

"--*5"
years iater along with the divi-
dend from the following years.

Convertible
peferene
shares
This is another type of preferene
share whih pays a fixed rate rate
of interest until a ertain time.
After this time, it is onverted
4dt*-'{
. Bears sell shares expting pries to fall.
into an ordinary share on whih
the holder reeives a dividend

d
rather than intrest.

stokbroker peo MaIp

ordinar shars, orr avII4(e -
;'D 'l
\id
equities poBaIIIIoo ea)
returns pr
preferene shares ITpepoBaIII
aI . Stags buy newl issued shares in the expeta-
umulativ preferene aolIeIIIe IIpBe- tion that pries will ise, then sell them on in the
shares poaIIIIIe a
hope of making a quik profit.
onvertible preferene olIepTpyelvrIe p-
shares epoBaIII a

Shar pries

If shares in a partiular ompany beome more po-

pular, the share prie will rise. This an happen when
the eonomy is booming or the ompany's profits
have inreased for whatever reason.
What is a share index?
People ative in buying and selling shares on the
stok market are known as speulators and fall into The stok market of eah ountry has one or more
three ategories: share indies. A share inde is a representative group
't48 ommeriaIngIish
of shares hosen as a barometer of the movement of
the market as a whole. This is usful for investors
wishing to see how well their shares are doing om.
pared with the rest of the market. Examples of share
indies inlude:
. FsE 1oo: the 100 largest ompanies listed on
the British stok exhange.
. Dow Jones Industrial Avrage: onsists of
30leading industrial ompanies in the US.
. NIEI 300: the top 300 shares on the Japa-
nese stok market.
speulator peo.ee'pe
bull r omDanv's assets.
bar }Iee
stag oeII
share inde II a
Fied.interest seurities
As we have seen, another way of earning mone on
the stok exhange is b making loans to larger om.
panies or to the government in the form of fixed-
interest seurities. Logially enough' holders of fixed-
intrest seurities are paid a fixed rate of interest,
and suh seurities an be bought and sold like shares.
Loans made to joint-stok ompanies in this wa are
alled debentures; loans made to the government are
alled government stoks.
Debentures
Unlike shareholders, debenture holders are not mem-
brs of the ompany in question. They do not share
l | . he s t o kex ha ng 149
the members' risks; they reeive a regular inotne from
their investment and take preedene over the sharehol.
ders if the ompany is liquidated - that means, deben-
ture holders are paid before shareholders. This maks
debentures a relatively safe form of investment.
ost debentures are seured, registered and redeem-
able:
Seured If a ompan annot repa the loans
debentues or pay the interest, the holders of
seured debentures (also known as
mortgage debentures) are automati-
all entitled to payment frotn the
Unseured Holdrs of unseured dbentures (also
debentures known as naked debentues) are not
automatiall repaid from the oi-
pany's assets if the ompan is un-
able to pay in the usual way. The
an of ourse go to ourt to reover
their mone, but are not treated dif-
ferently from the sharholders. An
unseured debenture is basiall no
mor than a promise to repay a loan.
Registered The holders of registered debentures
debentures are listed in a ompan register.
These debentures an onl be trans-
ferred in aordane with ertain
terns and onditions, and ever
transfer must likewise be entered
into the register. The ompany an
refuse a transfer, in whih ase the
person to whom the debenture was to
be transferred an appeal against the
deision.
 nglish | | .T he s t o kx ha nge 151
ommi|

Bearer A bearer debenture is an unregis- irrdeemabl debenture epoooooe

debentures tered debenture whih an be nego- o03aeJIo
tiated by just handing it over to the onvertibldebenture oIIepTpeooooe
new holder. oo3aBo

Redeemable Redeemable debentures are repaid

debentures (redeemed) on a fixed date or Govrnment stoks
within a ertain perid, often a| In Britain, government stoks are known as gilt.edged
a higher prie than the issue prie, seurities (gilts) bause they are suh a safe form
whih means some extra monev for
of investment. Gilts are loans made to the govern-
the holder.
ment in order to finane its spending, and are repaid
Irredeemable There is no fixed date for the re- at a fixed futur date (at maturity). In the mean-
debentures payment of irredeemable deben- time, the gilt holder reeives interest on his loan'
tures; the loan is only repaid when The interest reeived on gilts is known as the ou-
the ompany is liquidated. How- pon. Gilts fall into three ategories depending on the
ever. holders of irredeemable deben- date of maturity:
tures may ask the ompany to re. . Shorts: Gilts to be redeemed in 7 ears or less
dm them if it fails to kep up its . ediums: Gilts to b redeemed in a period
interest payments. of 7 to 15 years
. Longs: Gilts to be redeemed mor thrr
Convertible Convertible debentures an be e-
15 vears from the date of issue.
debentures hanged for ordinar shares.
Tpes of gilt
to liquidate a ompany poa
orvlaIIIo Index-linked gilts These are gilts rhere the ou-
seured (mortgage) oeeerroe .ooo
pon and the amount at whih the
debenture oaeo gilts are redeemed is linked to
unsured (naked) eoeeelloe .oooe inflation.
debenture oao
Floating rate gilts The oupon paid on these gilts
registred dbentur eIIoe.oJIoBo
varies depending on market on-
oaeo
ditions.
appeal ae
bearr debenture oooe oaeo Convertible gilts When a onvertible gilt reahes
IIa peBL1TeJI'
maturity, the holder an deide
redeemable debenture ,ooBoe oaeo, whether he wants to have the
oaIIIaNIoe opee- gilt redeemed or to exhange it
er po
for a new gilt.
 ommeri|
nglish l|.The stok exhnge

6. What are the differenes and similarities between

gilt-edged seurities apallpoBaI{IIIe eIe debentures and gilts? Whih is the safer form of
(gilts) ya investment and wh?
oupon yoII; oxo o eIIIlvl
aa 7. What is the differene betweenfloating rate gilts
shorts paTlopoIe III and indx-linked gilts?
ya
mediums peIrepoIIIe IlIIIe
ya
longs oopoHIe IIIIIe
ya
index-linked gilts eI{IIIe ya, yIa.
I ypoBeI
floating rate gilts eIe ya a-
BaIotI lypolvl
convertible gilts olrBepTpyeIvIIe eIe
ya

Qustions for revision

1. What is the stok ehange and what is its fun-
tion? Where is it loated in your ountry?
2. Whih type of share do you think offers the most
advantages to the investor and why?
3. What do you understand b ..bulls'' and ..bears''
on th stok market? What fators do you think in-
fluene this type of behaviour?
4. What is the differene between shares and deben-
tures? Whih do you think is the safer form of in-
vestment and why?
5. Whih is the safest type of debenture for the in.
vestor and why?
Glossary nglish to Russian
A
to aept - IIpII[a; aepoBa
aeptane (bill of exhange) - aeIIT (ee)
At of God - xoe ee
ativ partner - aBIII apep
atual total loss - a IIoa
adjustment (of a omplaint) - ypeypoa (opo,
oo); opaa
admissible - papeel ( oy)
ad valorem duty - oIIIIIa ad valorem (ae B rrpo-
eIIo ooIeII To1!!oToapa)
advane order - peBapr 3aa3
to advertise - peJlapoa
advertismnt - paa
advising bank - a, poo BIa o a-
pey
agent - ae; IIpTaBTe
airlin - aIaJIvIHfl'
air waybill - aBapytoa IIaatIIa
ambassador - oo
to appal against - Iloaa aeI IIpo
ATL - . atual total loss
available - Ieloilcg' la
availability - Etle

B
balane - aac
bank aount - ao
bank od - arro o
bankrupt - apo
bear (stok exhange) - (MeBe.> (pa); prreo
ee' par I{a IIoEee
bearer heque - eI IIa pee
bearer debnture - oa' |la peflfl
156 mmriIEnqIish GIossry 157

bnfiiary - ap; oa peT F'R - . Cost and Fright

bilatra] - opo hain of distribution - peaa
bill of exhange - Be' paa Chamber of Commere - Topoa aaa
binding offr - Tepo peotelre heque - e
blank endorsement - aor .oare hque stub _ opIIIo; (opro) aoII; a
bonded warehouse - Tao)fiellr a pae IF - . Cost, Insurane and Freight
ToBapoB .o aI oIIIIII IP - . Carriage and lnsuran Paid
bond warrant - oryIe o xpaell Toapa a TaMo- irulation - opaee
}ttItl1o a,e laim - peell; pIa}ra; aoa
bordr - paa to laim - pe'flBJI peTe
breah of ontrat - apyell opaTa to laim damages - peoa Bo}IeIl yro
bulk argo - alllo p lean bill of lading - a IIaaIIa
bulk disount - ooa .a to lear goods through - paao)Ir py; poo
bulk order - oor ara ustoms - a1vro}re}IIoIy
bulky rgo - poo py MR - . intrnational onsignment note
bull (stok exhang) - <.I'>(pa); peo e- oD - . ash on delivery
e' pa a oBItueII olleting bank - a-ouae
buer - oaT ommerial bank _ olvIepe a
ommerial invoie - TopoBI ve-aTypa; Iolltp-
CAD - . ash against dorrmrrts e o
apital - aa ommerial servies - olutvlepe yJI
apital nrarket - pIIIo allaa ommission - oM
to anl - oTeII; alllrypoa; IIpIraBaT e. to ommission - IloIloluoBa; eaT aa; BBoT
Te}II B eTe (ap., o oee)' aBa IIaaIo
argo - py to ompensat - oepoBaT
argo poliy - o TpaoBaIIpy ompensation - olvtea
Carriage and Irrsurane Paid - rreeoa paxoal{e to omplain - oaoa; IIoaBa raoy
oIIaeI omplaint - raoa; ae; IIpeeII; peaa
Carriage Paid To - epBoa oaea .o ompound duty - IvIIIIaEItaIIoIIIa
arrier - epeo; paopI{a olvIaII to onclude a ontrat - aIoa oIlTpaI
ash against douments - ollaa oe oyel{ o- onfirmation - IloBeprrelre
yeTo onfirmed - oTBeper
ash disount - a p ollae IIaItIlvIIul onfirming bank - a, oBep.a ape
aslr dispensr - aoa onsignee - pytolloae; I{ol{aop
ash on dlivery _ oaTa IIp oTa' ((}a'> onsignment - ap (oapa), py; oIrI{aoIIa
ash with ordr - oaa p aae opaBa ToBapa; aaI{a
entral bank - IrpaI{l a onsignor - pytooTllpaeJl
rtifiat of origin - pa poxo}fie onstrutive total loss - orrTpylTa oa mneJl
158 ommrialnglish Glossary 159

onsul - oy ustomer - 3a3

onsular invoie - oycvi oc ustoms - ao?t(Il
onsulate - oIlTBo ustoms invoi - aN[o}ItIlIa
IIaaIla: ao)Ider
onsumer - op o
onsumr servies - IIoTpeTeJIe y ustoms permit - aIoteoe papeell
ontainer - oeep CWo - r. ash with order
ontainer bill of lading - aa.a IIa poo oBapoB
D
oepe
D/A - . doumnts against aptane
ontainerised goods - oap (py) oeepax
DAF - crvr.Delivred at Frontier
ontat - opa; .ooo' oaIIIIIe
damage - ope}/e
to onvert - oIIBeppoBaT
damages - IloBpe}ee; yep
onvertible debenture - olrBeppea oa
dangerous goods not - yeorelr o ope oa-
onvrtibl gilt - oeppyere er ya
IIoo py3a
onvertible preferene - oIrepTpeNIIe
date bill - Bee yaalro taoi oaI
shares - ITpBepoBaIIIIIea
DDP - . Delivrd Duty Paid
ost - ToI4oT; paxo/
DDU - . Dliverd Duty Unpaid
Cost and Fright - olvlo pax (yarara
deadline - (pa) po
poao ToMo Toapa' ItIoaIo eo o-
debentur -oooe oaeo; oa
aB B oIpel op) to debit - eoBa
Cost, Insuran and Fright - ToMoT' paxoBa debt - o
pa (yaraea poaBoNI oNIo oapa' to dlare goods - elappoaT oBap
BJIIoaIoa eo oaBy B op/eer op to dedut - BIa' oI{NIa' yp)I(Ba
paxoae) to defr - ap}raT
oupon (stok hange) - yolr; olvlaI po- dferment - 3aep}a; opoa
er oxo o oavl' a<v|vl delay - aep?a
over (insurane) - opIe (paxooe) Dliverd at Frontier - oaBa o palrr (p,
overd - opII, oeer ooauaro, uo oTBTeoT oTaBa pa-
ovr note - Bpeelroe paxooe BeeBo popalleT oIto a /oaBy to aloeo
overt - prr <(paIIID TpaIII a3aIr)
PT - . Carriage Paid To Delivered Duty Paid - oaella oTaBa oIIIa
redit - pe (yoe Inoterms, IIp ltooporvl oTeo po-
redit ard - peIla lapToa aBa 3aaI4Bae IIoe oo' a oBap ,oaelt
CTL - . onstrutive total loss ya3al{oe Meo B pae olyae; e pIt'
umulative prferene shares - aoeIIIe IIp- Be paxoI o oTae pya (ao, oIIlI
eoaIII a ..), oeBeIIo 3a IIop oTeplo oBapa'
urrn - BaIa Ioa OIIIIiI poe IIIaTI' BIaBae-
urrent aount - y e Ie opTe' o oo luoella eeT poaB)
160 ommeria|
ng|ish GIossrV 161

Delivred Duty Unpaid - oaIla.oTaa 3 oI. to disount a bill of xhange - pIIT ee -

IrI (yoBe Inoterms, Ilp oopo oBeTeo oolvl
poaa 3aaltBaeT oe oo' a oap o- to dishonour a hequ/bill of - oTaIa oaTe
aBelt ya3aor NIo TpaIIe oa; Be ea/B
pvlcl<' e paxoI o oae py3a' oeell- exhange - pra
o 3a Ilopy oTplo oapa (a rvelle IIoI- to disount a bill - IIp ee IroIlToIvI
YIrtv| po BIa' BIIIaBaervrIx IIp ope) to dispath - opaB
o oo loelta e pae) to dispose of - a (o); ra
Deliverd x Quay - oTaa } pay (yoe dividend - ,BeII
Ilroterlrls, p oToo oBeTeIIo poaBa 3a- doument of title - orMeII, aro paBo oBe-
ItaIIaT oe Too' a ToBap o pt IIo

doumentary redit *,oyIelrapl
ap,
aar opT paprttelr IIoooBII Boy;
douments against aeptane - ,oyNIeIrTI o IIpIr-
paoI o oTaBe pya (ao, IIIJIIII
..),oBI{IIoT 3a I]opy lloep ToBapa o Io; Ilpeaa paBa oerroT oe Iloye

aoo oea e IIpoaB) ea oae

douments against pament - oI(IeI IIoe oJIaTI
Dlivred x
Ship - oaeo opa (yoe
domsti - oTeeBIlIIoo poBoTBa
Inoterms, II l{oopolvl oeIIoT Ilpoaa 3a-
down payment - peollaa; aBaIIoBI aer
aae' oia opa oapo a opy p-
D/P - . douments against payment
r yaar op (oap e papylrell e o-
draft - ae}itoe IIopyeIIe
oToe Bo3); Be paoI o oae pyta'
to draw (heque, bill of exhange) - IIa (ue,
oBeTIIIto 3a opy IIoTpIo oapa o oo
e)
luoIla poae)
drawe - paaT; o' a }oopo IaII e
delivery - oaBa
TpaTa
deliver ordr _ 3aa3 IIa oa; opp a I/ay
drawr - paaIIT; o' oIIaBIIIe e
oBapa o .a
dumping - eIIII
deliver time - pott oTaB
dutiable - oaaer orrro
demand - po
duty - oIIIIIa
to deposit - eolrpoBa; Ba.IBa
duty-fre - orr; eoaar oro
deposit aount - eoTr e
DQ - . Dlivered x Qua
Ds - . Delivrd E Strip arly payment disount - a 3a poITJIay
DGN - . dangrous goods note embassy - ooTBo
diret dbit - p1vtoeeeoae to endorse - opoaT; eaT IIpe.aoIIIo
diretor _ peTop aII
dirty ate's Reeipt - IpaLIa'{ paIda o To' endorsement - .oae' IlpeaoIta a (a
To p3 I{e ope eo yae, Beee' ee T.II.' IIoBep)aIo-
disount - Ita a epexo IIpa o TofoIy oIyeIrT I pol\[ )
6 - 10686
162 mmrilEnqlish GIossry 16

end-usr - oIleIII ooae; ItoIIeIrIope- fixd.term aount - pour ue

e floating poliy - eIIaI o
to enquire - aIIpaIIIBa' aITpaB,I allpo floating rate gilt - eEI{Ieya aaloM l(por
enquir - apo to flutuate - oa
quities - otoeIlIe a FoB - wr. Fre on Bard
eviden - oaaeo' eBo' tIoT}ItIIe follow-up ordr - oIo aa
exise duty - ar op foreign - IIoTpaI, aperr; e.apor
to exeute an order - IoI{ aat forged - arr, or
to expire - e'a forgery - N[oIeeBo
xpir date - aa TeI poa forwarding agnt - eop
export dut - IrropIla IIoIIIIla Forwarding Agent's Crtifiate of Reeipt - a plvl.
exporte - opep I e.TopoM
prss train - opoo oe; IIp fragile - xpy
to extend - po,eBa Free Alongside Ship - <pao Bo opa IIaD;
extrative industr - oraoa poNrtIIIeIIo yoe Inoterms, p oopo oTeTBIto IIpo-
(opa) aa alaltBae' oa oap oooBeII -
xW _ . Works IIop Ilop}tt a opa aaIrIIoM op;
x Works - pao-ao (yoe Inoterms, p Io- oo l\{oea c paxoI p' a a}Ie o-
opoM oBeBeIIo IIpoaBa 3aaBae' I(o- eeltoT 3a op oTplo oapa e oIt.
a oap oa3a a eo ae' Nlaa3e ..; Iia ae
oyae o}fiaT e paxoI IIo BIBo oBapa F're Carrier - oor peoI; pao-pa.
o aa' epBoI(' aorterrllo obe ..) opIlo /o
r on Board - <.pao op a>, o; yo
F
Inotrms, p oopo oTBeBIlIIo Ilpoaa a-
fatory - ao; apa
IaIIBaT B rvIoNIeII IIop3 oooIlltoo -
FAS - . Free Alongside Ship
opy ToBapa a op
faulty - IIeITpar; eaeer
fight - pax; py
favourable - aopr
frontier - palla
F.CA - . Free Carrier
to fulfil - IIoII: I{oIl
FCR - . Forwarding Agent's Certifiate of Reipt
full endorsement - ,or IIoaNIeII
feder servie - yra oaB
finished goods - oor oBap' poyl G
firm offer - TBepoe peo)I(ell general average - oa aap
firm ordr - epr 3aa3 general argo - erarrr py; opr py
first of exhange - epr eMIIp e gneral nquiry - o alIpo
fixed duty - poBaa oIIII{a general partner - ar Ilapep; elrepaIlI apep
fixed.interest seurities - errIIIe ya po- general partnership _ }OMIIaII IIeopaIIeIIo oT-
arro oxoIroTIo TTeI1oIo
164 ommerilnqlish GIossry 165

gilts - . gilt-edgd seurities injured party - IIoTpIreIIIa(opaaIa' oltetua

gilt-edged seurities - eullIe ya apalrpoBalr- yI) opoa
o prro insption order - IIIIor opep
goods train - oapr o3 instalment - B3IIo; Ba; IIae}
govrnmnt stoks - oapTBeIII eItI ya insurable intest - paxoBo epe
insurane - TpaxoBalle; paxoBla
to grant - peoa
insured - apaxoar
grouage bill of lading - opa a,I(afl
insurr - Tpaxoae' Tpaxort
grouped onsignment - opr ooae; opr
interest - poeTr (o alvl; a aa)
py3
interest rat - poellTlra aa
interrnediary - opeIII(
haulage ompany - oNraII IIae}rIx epeBoo international onsignment not - Nle}rIlapoa py.
hiddn renrinder - pIoe aolvlal{e 3oa aIaIIa
hire purhase _ olIla paoy invalid - lrTr
home-produed goods - oap oeeIloo poo- invstment _ IIeT'I
investmnt aount - IIBeor e
Ba
invitation to tnder - oIIe elrepa
to honour a heque/bill of exhange - IIpIr /e-
irrdemable dbenture - epoIlo ooo oaeJr-
e oIIaTe
To
house bill of lading - Ilype IIaaIIa
irrevoable - orr
P - r. hire purhase
to issue - BIaaT (o ee); BIIIa (o ax)
hull poliy - o paxoBall yIIa
issu prie - BIIIya eIIa
I issuing bank - a-e
import dut - oIIIIIa a MIIop
J
importr - IvlopTep joint-stok ompan - aorrepa oaII
to impose duty - oaa oro to justify - ooora
in bond - axovltlc a TaorrterrIloira; IIea-
aorer L
inotrms - epIIlI' opeee yolr IToTa labour osts _ pyoIe aTpaI
NIoeIIepexota oTBeTTBeIIIrooT TopoIrI It o. lase - ape.a; ape,I
'ooBop
poli' o peIe M}t(.yapoIl Illl oalelvI leasholder - apraTop
indemnity - apal{ o yro leasing - 3I{; ape}Ia
index-linked - yvraro ypoBelr to legalise - JIaoBa
industrial dispute - orrI IIpolvIIIIIeIIo legal tender _ aooe aJttIIo peTo
inferior _ tlpll<(o aee); oxo, eaee legal proedings _ yeoe papaeTo; pa}IoT.
inflation - pelre ea B e
initial order - epBoltaar aa lesse - apIraop
166 ommrr|
nqlish Glossary 167

lessor - apello,ae N
lettr of edit - ape.B nakd debnture - oerleoe oooe oaTeBo
liability - oTBeTTeIIo naturl rsoures - IIppotlie pypI; oeIIIe -
life insurane - paxoall )IIt oaeI
limited partner - apep opal{rro oeBII- negotiabl - IIo,a orIo; eooa.
IIoI I

limited partnership - oeTo opalrelro oTe- to negotiat - pooT epoopI; oyr,aT; epe.
BeIIoTIo yya
limited stoks - opaller aa non-binding offr - p'o}fiIree oae
liner - aep notar pub]i - oyapcr oTap
t liquidate - vIPiB|4t|4poBaT
to load - py
o
oan bill of lading - aalIla Mopx epoo
loan - y.a; 3a
oean shipping - Moproe yooBo; Mopa .oaa
longs - oopoIlIe Ie ya
offer - p,o)Iee;oepa
loss - yro; op
offer without ngagement - peo}ItIle e oa-
luxury goods - peTI pooIII
eT
I on approval - oaoryIell; oe oop
mail order ompan - IIoIJIoa olvIaII; IdorIIa- on-board bill of lading - aa.a a p, pI
Il IIoIoo TopoJI; IoNIaII' 3al{4aloa. a op yIIa
llpoiae oapo IIo Ioe opn-aount terms - yoB olpIoo eTa
manufatuing industry - poBoBo (a opa) open hque - oI(pIr
marked heque - e apalre oar opning bank - arr-e
marine insurane - opoe paxoBa; paxoalre order - 3aa3; oep
opx epeBo3o ordr bill of lading - opepTla IIaaIIa
Mate's Ript - ypNIaI{a paa order hque - opepllr e
maturity - aa/po BIIIaTI ordinary partnrship - oa rreopaeo o-
mediums - peIIepoIIIe eIII ya BeBeoTIo
merhandise on all - oBap o peoar ordinar shares - oroellIe aI
mixed dut - MeIaIIa oItIIIa origin - pxofitelre
mixed poliy - Nlerrlar paxoo o ovrboard - a op; a opTo
mortgage - ao; oea overdraft - eppaxo
mrtgage debentur - o6eIloe tooo oae- to overdaw - peBI pe ( ae), oy
Bo oeppa
M/R - . Mate's Reeipt ovrdue - popoer; aoar
multilatal - ooopo over-pried - aBIIIIer (o ee)
multimodal - (p.) pelree paIII Bo to ow - r o}ItIIIrvI
 168
ommerialnglish Glossry 169
P
pro-forma invoie - peBapeI ce
paking - yraoa
property _ yeo; oeoT
partial loss _ aTI{a e
protetive duty - poTeolra Ilota
partiular avrage _ aIIa aap
protest _ opoeoBalre; po
partnrship _ IapTlrepo; oeo; lolvla
publi limited ompany - oTpIa ol\{all opatl-
party (to ontrat' hequ et.) - Topoa (opaa,
eo oelI1IoI
vea . . )
publi setor - oy.apr eop
passnger train - aa}Ip oe
publi servis - oeere (oyapTerrrIe)yrr
passing of risk _ epexo pa
payable - Iloefi(a oae; pTaro a
payee - oae (e) quality - aeo
paying-in slip - a, aIIoIIeN(rp Blree quantity - Ioo
y.
1\,1la e quantity disount - oIIToa I{.IIa
payment on invoie - ollaa o oyer quay - pa
oa
perishable - opoop ToBap quotation - paIl; pa-
personal aident insurane - paxoBae
o ea- R
Itoo ya'I
rail onsignment note - ara.a fl epBoot }fie.
to plae an order _ paIIIa aa
pl - . publi limited ompany e opoo
railway ompany - rt(eeoopoIla I{odaII;o-
poliy _ (paxoo) o
a }re3lroopo}IdliIx
Ilpeo3o
port of destination _ opT IIataeI
raw materials - IpeBI }IaepaI; Ipe
port of shipment - opT oTpy
reeived bill of lading - aaa a poper, o
preedene - eIIo; pe}ryeo
IIe llopyer py
preferene shares _ pBepoaIe
a redeemable debenture - toooe oaeo. IIoa-
preferntial treatment _ peepear pe}Ivl;
pe- Iao opeerr po
}ItrvlMaI{1\{aIIooaopToa
to redisount _ epeyue (ee)
premium _ paxoBa p4; paoo 3IIo
registered debentur - Ieoe ooBo oaeo
prie _ ea
reminder - alloae
prie redution _ }Irr(eIIe
eI{ rernitting bank _ a-aeJI
privat limitd ompany - aI{a oIIa
oaII- to rnder - oaIa (o yyax' oo)
o oeI{oIo rent - aeIrIIa aa
private stor - ar }tTop
\ to rnt - apeoaT
private servies - aIlI y
to repair - peIollpoa
privatisation - pBaa repeat ordr * oopr/oopar aa
proedure - popa to repla - aI{
proessing industry _ epepaaIBaloa reputation - peyTa
polvIIIIIe-
lIo to reserve the right - oa a oo pao
 .l7o
restitive endorsement - opaer Iioae
retailr - potIIIr opo
to retain - oaT; oxpal{T
to return goods - Bopaa ToBap
revoable - oIo
right of disposal - paBo paop,I}fielr; Ilpao oe-
I{o
rivr bill of lading - aa.a peIIIx Ileeoo
to sarifie - poaBa IIo a+el{oee: e
I
s Io
safe - e
salable - I]poIrr oa}
sals ontrat - ooop yll-po/a}fi
sample - opae
sampling ordr - aa a oay opao
savings - epee
to sal - oaTIBaT
seawortlry - or aBaII (o e,1
seond of exhang - opo Iep BeeJI
seurd dbenture - oeeeltoe oooe oa-
Bo
suritis - eEIIIe ya
s]lr - poa
semi-finishd goods - oyapIa
servie * yya; rra
to sttle - paaBa; paIBa
share apital - aoepr aIITa
shaeholdr - aol{ep
shae index _ Ire a
shares _ a
shipper - pyoopae
shipment - py; ap ToBapa; opya; oTIIpaBa
shipping - IIopya' IIpeBoIa yaa
shipping line - Ll:vr'Iopx epeool{
shipping not - yBe.olvIJIeIIeo ope
ommrlj
ngJrsh Glossry
ship's rail - pa yIra; eep
shorts - paopoIrIe eIIIe ya
to shortship - IreoIIoTa
sight bill - BeI{e oIIaTe o peeIII
signatur _ o.II
to sink - yolryT
sleeping partner - aBIlr apep
sole tradr - arrr peIINIae
soliited offer - oBeoe po)ree Io allpoy
speial partner - apTep opaeo oTBeTBeo-
speifi duty _ eva IIoIIIJIa (pavIBa-
eT ea' tlI, oea, a e o oo)
speifi enquiry - ear apo
speulator - preo e; NIap; eyII
stag (stok xhange) - (oe' (peo ee' par-
a IIoI ax)
stal - Ilpopoel{l; yape
standing oder - ooIIIlI aa
statement of aount - BIIIa o ev
stokbroker - peo poep
stok exhange - pa
stk market - ooa pra
stoks - (oyapere) IIIe ya
storage - paelle
straight bill of lading - eIIIa IIaaI{a
subrogation - epexot paB paxoBaeJl paxoB
to suffer a loss - oe r
supplier - ocaB
to supply - floa
T
tallyman - opoJlep
tnder - TeIIep
term bill - Be oao eIte aaIIEIoo
poa
trms of dlivery - yoB oaB
112 ngIish
ommri| Glossry 173

trms of paymnt - yJIo oaI voag - pe; IIaBaI{e

theft - opoBTo; xelre
through bill of lading - Ioa IIaaIIa
tim bill - ee o poo}t oJIaI
tirne poliy - paxoo o IIa opeJler po
title (to goods) - paBo oeo (a oap)
total loss - oa e
trade agreement - opoo oalee
transation - paa; oepa
transfer - eprBo ()
trial order - poI taa
voyag poliy - IIo paxoBa IIa epo
w
warehouse - a
warehousemalr - paoIl aa
wholesaler - oor TopoB
to withdraw (an offer) - oIBa' oTeII' aIIIIpo-
a (po}elr)
to withdraw (money) - a (e)

U
unonditional - eyor; eooopr
unfavourabl - aopr
unlimited liability - eopaeItIIa oBeBeoT
to un]oad - pap)ra
unreliable - ea.err
unseured dbntur - eoeeIll{oe oooe o-
o
unsoliited offer - aBIIoe peJIoEteIIe (eae-
IIoaBo e allpoa o opoIII 3aa3a
eIo a lloIx eo)
unstable - eaI, yor
urgent - pour
utmost good faith - ooe ,oBepe (oooe paBo
3a}oa o paoBaIo' oopoe 3aIoae olvl'
To o' )realoe apaxoBa, oao a
paoBII{ I opaIo' }oopa o}Ieo-
B a aJloooore; paxoae' BoIo
oep' oar I{eoT ayrrtIle oo' oo
o paxyro)

v
valid - er; ro y
valuable - errr
vermin - Bpe.Te
vote - oo
 175
Glossry

a-aeJIII{I - rmitting bank

a-yuae - olleting bank
Russian to nglish
apo - bankrupt
bank
a-r - issuing bank; opning
A eorrrr - irrvoable
aaor IIa?It - down pament or; eoopovr - unonditional
aBapyoBa llaaa - air waybill eap - benefiiary
aavlavl:,klfl' - airline eorr - duty-free
irredemabl de-
al' peaB - agent epouo ooBoe oaeBo -
ape - letter of redit bntur
a IIpeNI eopo - Frwarding Agent's Cer. pra - exhange; stok exhange
tifiat of Reeipt peo poep -- stokbroker
ar apep - ativ partner preo e - spulator
a (e) - aeptane aopr - favourable
aepoBa - to aept aor oael{ - blank endorsement
ar op - xise duty (pa) - bull
<.It>
aI - shars r oIl - to ow
aoep - shareholder
B
al(oepa oNIaII - joint-stok ompany
BaJIIa - urrn
a}ollepr aa - shar apital
Bee - bill of exhange
alrllypoBa (peoee) - to withdraw (an offr); _ sight bill
Be I oIIaTe I1o petBeI
to anl yaaIIIIoo poa - term bill
Bee oao B Tee
a - omplaint oaTI _ date bill
Be aal{o ao
ape}Ia; ooBop ape.I - las
Be}eo poolvl oIIaI - time bill
apIl.aTop - leaseholder; lesse
3o - instalment
apella IraTa - rent
BI{lIBa_ to deposit
apeltoa - to rent
BypeII aaI{a - house bill of lading
apelloa - lssor oBpaa oap - to return goods
BopoBBo - theft
aa - balane pet - vrmin
note
a, oepalo ape _ onfirming bank Bpeeltoe TpaxoBoe eeo - ovr
opo eIIp Bee - seond of exhange
a, p1' BIIIa o ape - advis-
I,aBa() - to issue
ing bank
BIIIa o eTy - statement of aount.
ao lto, _ bank ode (heque, bill of
BIIIIaT (ue, e) - to draw
a e _ bank aount
ehang)
aoa - ash dispnsr
176 mmerilnqiish GIossry 177

lIIoI{'3aa3 .* to exeute an order olyelr o paIIII oapa Ila TaNIo}fieIIo1\,t I(JIa -

BIIIya (a) - to issue bond warrant
Iyira ea - issue prie oye' alo paBo oeoT - doument of
title

oyIellapr apetTI4B - doumentary redit

apall o yro - indemnity
oyMeIrI IIo pI{Io - doumnts against aep-
el{epaIrI apep - general partner
tan
eI{paIlI o - floating poliy
/oyivtelrIIIo oIIJtaI- douments against payment
oI{I IIaa (o e) - seaworthy
o - dbt
oo (p oooBa) - vote
ooBoe oaeBo' oalllae{oe ollpeeer
oyapeI errIe ya - govrnment stoks
po - redeemabl debnture
oyapellI IIoTapy - notary publi
oooe oao; oafl - dbentur
oyaper eTop - publi setor
oopoIlIe errI ya - longs
oor oBap - finishd goods
oopoIll - long-term
palra - border; frontier
oTaa - delivry
poo py - bulky argo
py - shipment; argo
py - to load aoa - omplaint
yoopaTe - shipper; onsignor rttetoopo)Ila olvta - railway ompany
ytooae - onsignee
3
a op; a opo - overboard
aa eelr poa - expiry date aB - fator
ByTopo vi- bilateral aIIIIeIII(o ee) - over-pried
.eeoa - to debit aep'ra - to defer; to dlay
ea IIoa e - atual total loss aep}ra - delay; dferment
el - valid aa - order
eappoa oBa - to delar goods 3aa3 a oTa - dlivery order
eNIII _ dumping 3aa3 a oaBly opao - sampling oder
IIo3I{Ie - deposit aount 3aa3 - ustomer
ellolrpoa - to deposit aIoaT opaT - to onlude a ontrat
BIr - dividnd alooe IIaetIIoe pTBo - legal tender
I,IpeTop - diretor aJIo - mortgage
oraroa IIpoIIIIeIIo (opa) - etrative 3a}4Il - to replae
industr aIIpaIIIa - to enquir
.ooop _ ontrat; agrement allpo - enquiry
.ooBop ItyII-poan - sales ontrat apyerrt - foreign
oaaTo - eviden apaxoar - insured
178 ommeria|
nqlish GIossry 179

vl oIrBepTpeMI IIIIre ya - onvertibl gilt

elllia alaa _ straight bill of lading or ooae - end-user
Meoe ooBoe oaeBo - registered deben- ItoIIaTop - onsignee
tur oIlIlaoIIIIa oIlpaa ToBapa - onsignment
teror a - available opItTBIIa IIoI{a - onstrutiv total loss
IIopTep - importer oIIy - onsul
Myo - property Itotlft l'oc - onsular invoie
IIeTorrr e - investment aount oItyTBo - onsulat
IIBeT - investment oep - ontainr
,I{a - share index opa - ontrat, agreement
II.oaMeI{- endorsment ItoIIop - tallyman
IIopoBaT - to endorse or IIpol\IItIeo- industrial dispute
IIopaI - foreign opelol{ (vea) - hque stub
eot opep - inspetion ordr paTopo}JIe eIIIe ya - shorts
- inflation Ip. - redit
oTa - mortgage p.I{a apoa - redit ard
oII - to fulfil olr - oupon
Ta - to epire

aep - linr
aIIa - apital eaoa - to legalise
aeo - quality tI|i apr.a- leasing
oea - to flutuate ItBpoBa - to liquidate
oeBo - quantity JIvrtIuI
opx epeoo - shipping lin
olu - ommission
otvlepee yy - ommerial servies lvr
olvrpe a _ ommrial bank MaIe - speulator
(NIeBe) (pa) - bear (stok exhange)
oIepe loflc - ommerial invoie
olvIaIIae[IIIx epeBool( - haulage ompan e,I(IrapoIra pyoBa IIaI{aa - international on-
oillall lleopalleo oBeTTBeIIoI _ gene- signment not
}Ie}yllapol ----international; foreign
ral partnership; ordinary partnership
lvtllooTopo - multilatral
oIIa - ompensation
l\{opItopaxoa - marine insuran
ontIlIrpoa * to ompensat
Nlopoe yoxoTo - oean shipping
oIIBepTpoBa - to onvert
MoIIIIlIeBo- forgery
ollBeppyea oa - onvertible debentur
oI{BppyeNIIeIIpepoBaIrI{Ie a - onvert-
ible preferene shares IIaIaIla l\(opIx Ilepoor - oan bill of lading
180 ommrilnqIish Glossar 181

IIaaIIa IIpeBo3o ,t(e3llo opoo - rail on. opaee - irulation

signment note oa aap - general averag
alarra peIIIlTepeoo- rivr bill of lading oeIe (oyapere) yrr - publi serv-
I{aaI{a a py' pI a op yIIa - on.board is
bill of lading oeo opallo oeB}llto - limited
Ilaaa lra poBepItllI' o rre IIopyrer py - partnership
reived bill of lading o allpo - gneral enquiry
Ilaaa I{a poo oapo oepe - ontainer oe elrtepa - invitation to tender
bill of lading oroItIe a - equities; ordinary shars
IIaaIIa - bill; waybill; invoie; onsignmnt opaller arra - linrited stoks
aoeI{Ie ppoalrI a - umula- opaellr oalvt - rstritive endorsement
tive preferen shars oaIBaT (o yyax, o) - to render
aJIvIIe- availability (oe) (peo e' pa IIa IIoIx a-
aotvlae - reminder x) - stag
apyee opaa - breah of ontrat ollpa (aoa) - transation
aro py - bulk argo oeaIaT - to seal
eaopr - unfavourable oIIaTa IIo oyero vea-aTypI - payment on in-
eer - invalid voi
IIooaBa - shortshipment oaTa o ay - ash on delivery
epaBI - faulty oaTa oe IIoe oIyeToB - ash against do-
IleaeBer - faulty uments
eIIaeIII - unreliable oaa p arae - ash with order
eoeelll{o oooe oaeTBo - nakd deben- ollaa p oTa - ash on delivery
tur: unsurd dbentur opooa - rotest
I{eopaIIeI{a oTeIIo - unlimitedoliabilit ooBa a - bulk disount; quantity disount
IlepaTa{o]ter- in bond
oor 3aa3 - bulk order
ar, eyor - unstable
oot Topoe - wholesalr
Iloaeer - inferior
opep - order
o opeplra IIaIaIIa- order bill of lading
oeeeoe oooe oaeBo - mortgage deben- opepr e - order heque
ture; seured debentur oTa a oo paBo - to reserve th right
oraoa - to omplain oBeBeIIIoT - liability; responsibility
oaaer oruo - dutiable oeeTBerrlroo poBoBa - domesti
oaa oruo - to impose duty otIa - to withdraw
oJIa IIa peBe - barer debenture oro - revoable
ooora - to justify o a I aT o I I aTe a/B Ite,{ - to d ishonour
opae - sample a hequ/bill
182
oTpIa I{ofIaI opallIlo oeI{oIo - o - slgnature
publi limited opany
oprr eI _ open heque
oNIe - to withdraw; to anel
oTIIpaa - shipment
oTpa - to dispath
oTpoa - defrment
ap oapa - shipment
apep opaeo oeBelloro - limited
partner; speial partner
apTlrepo - partnership
aap oe. - passengr train
at apTIIep - sleeping partner
polraar aa - initial order
epr 31vlp BIe - first of ehange '
epeBoIzr(e) - to transfer
peoa axoBaII oaeIII - Carriage and In-
suran Paid
epeoa ollaea o - Carriage Paid To
epeo - arrir
epeaoIra IIa.II- ndorsement
epepaarBala IIpol\[IIIIJIeo- proessing in.
dustry
epepaxo - overdraft
epeyya - to negotiate
epeyeT (e) - to redisount
epeot paB paxoBa It paxoly - subroga.
tion
pexo/ p}a - passing of risk
ae( - instalment
IIaetIIoe opel{e - draft
ope?fie - damage
oopr/roopar aa - repeat order
opya' epeoa pa - shipping
Iloaa aeIo - to appeal (against)
IIoeIII- forged
ommeria|
nglish GIossry 18
oBep}reIt- onfirmation; vidn
oBep}rfl - onfirmed
oI(IT (paxoo) - over (insurane)
oprr - overed
olyae - btryer
IIoa papoI(y - hir purhas
oIIIe I(oaMIe - natural resours
Ilo - poliy
o paxoalt pya - argo poliy
o paxoa IIa peBol('y - voage poliy
tloc paxoaI .Ira- hull poliy
oIIa re - total loss
oIloe oepe - utmost good faith
ot IIoaeII - full endorsement
oyapaI - semi-finished goods
oa (e) - paee
oya peT - bnfiiary
oeT r - to suffr a loss
opaBl{a - amendment
op IIaaeII - port of dstination
opT oTpr - port of shipment
oeylo aa - follow-up order
oo - ambassador
ooBo - mbass
IIopeIIIt - intermediary
oaB - to suppl
IIoaBI{ - supplier
IIooIIIII aa - standing order
oIoIIa IoaII - mail ordr ompany
IIopIIeIaTopoa - injured party
opee - onsumer
opee y - onsumer servis
IIoIIIa - dut
oIIIIIa ad va]orem - ad valorem duty
IIoIIII{aIIa NIop - import duty
pao paop)rel - right of disposal
184 ommerial
nglish Glssry 185

pao oo - right of disposal IIoeIrI (o a; Ira aIIa) - intrest

pao oeo (a oap) - titl (to goods) p1\4oeeoBae - dirt debit
peIT pe - to ovrdraw
pBaper 3aa3 - advane order P
pelBapTer e - pro-forlna invoie pao aa - warehouseman
poelle - offer ap)ra - to unload
peo}Iee e oae - non-binding offer; of- pa 3aa3 - to plae an ordr
fer without engagernent papIIIeI ( o) - admissibl
peNIeI pooIII - luxury goods paIIaBa - to sttle
peoaTa - down payment paop}a - t dispose of
poca -. to grant paIBaT - to settle
paao)ttT py - to lear goods through ustoms
pB pTI{LI- to laim
paelr - quotation
pyBo -- advantag; preeden
pe - voyage
peII - mplaint
peaa - advertisement
peIIJ{; peaa; raoa - laim
peaIa - omplaint
ppear pelv - preferential treatmnt
peapoa - to advertise
pBaTa - privatisation
peolrpoa - to repair
pBepoaI{IIIe aI - preferen shares
peya - rputation
por t llpoilr - salable
pour opoBe - retailer
pIIlvIaT - to aept
pIllo allaa - apital market
IIpIl BeeJI too - to disount a bill of
exhange
pIl ue/ee ollae - to honour a heque/bill epere - savings
of exhang opa llaa.a - groupage bill of lading
ppoIrI ppI - natural resoures opr py - general argo; groupd onsignment
pa - quay opr ooaMeII _ grouped onsignment
IIpaIolc - payable; du ra - to dispose of
pol 3aa3 - trial order oo,t epeoId - Free Carl.ier
poBo - to negotiate aa B JIyaaIo - to ommission
poae - sller e - safe
poea - to extnd epa poxo}tIl - ertifiate of origin
o3Boo (a opa) - manufaturing industry e peaa - hain of distribution
Ilpoxo?t{/e_ origin BoIIa llaaa - through bill of lading
popoI{I{r - overdue a - disount
poel{olla oIIIa - protetive duty Ia 3a poIIaTy - arly payment disount
popa - proedure
a IIp oa aIIIlvI- ash disount
poIrHa Taa - interest rate
a - warehouse
186 ommeria|
nq!ish GIossry 187

opoopT oap - perishables paxoo IrTep - insurabl interest

opoTo o3; pe - express train paxoo o a opeer po - time poliy
ItpIToe aoIlae - hiddn rminder TpaxoB - insurer
plr - overt' hiddn yeoe papaeBo - legal proeedings
ya - srvie Ip - raw materials
y)a oTa - feeder servi
T
MeIIIaafl oIIIIIa - ompound duty, mixed duty
a[oea aa - ustoms invoie
elar py - general argo
aro}ieoepapeIee - ustoms permit
erar paoo IIo - mixed poliy
aoIeI a, t xpaell oBapoB o yIIJIaI
Il,IeIte eIII - prie redution
oIIIIII - bonded warehouse
a (e) - to withdraw (money)
TaMo)I{ - ustoms
oeo - proprt
TBpoe peoEeII - firm offr
oaIIIIl - agreemnt; ontrat
epr 3ala3 - firm order
aIII apo - spifi enquir
ey e - urrent aount
eueIa oIIILIa- speifi duty
elrep - tender
po - demand
Toap (py) orreepax - ontainerised goods
peepoIe eIIIe ya - mediums
Toap oeeBeIroo IIpoBoa - home-produed
po - dadlin
goods
cpo oa - delivry time
oBap o peoaIII - merhandise on all
povr - urgent
oapr ITo3. - goods train
pour e - fixd.term aount
Topoa aaa - Chamber of Commre
a; ae - loan
opooe oJIaIeIIe- trade agreement
xoe e - At of God opor ve-aypa - ommerial invoie
ToNro - ost paal - transation
Totvro pax - Cost and Freight paaIIT - drawer
olvlo' paxoBa pa6 - Cost, Insurane and paa - drawee
Freight paa _ bill of xhang
opoa (opaa' ela ..) - party (to ontrat' peoa BoIeI{yro - to laim damages
heque et.) TpyoBIe apaI - labour osts
TpaxoBaII - insurane
paxoa )tIl - life insurane v
paxoall o IIeaTIIoo ya - personal aident yro; oep - loss
insuran yBeoNIIIeo opy - shipping note
paxoae - insurer eoIee o opye oaIloo pya - dangerous
paoa IIpeM - premium goods note
paxoBa - insurane yep}BaT - to dedut
188 ommerilngIish GIossry 189

aoBra - paking aIIa oMIIa opalleo oeBIlIIo) -

yppoa (opo, oo) - adjustmnt (of
a omplaint)
yJIo oIIaI - trms of payment
o oItpIoo eTa - open-aount terms
yo oTaB - terms of delivery
ya -- servie
yToIIy - to sink
yep - damage(s)
private limited ompany
ae yy - private sevies
ar IIpepIIIvIae- sole trader
ar eop - private setor
eI - heque
I a p _ bearer hequ
} apae oar - marked heque
cTa aJlaa - lan bill of lading

I
apa _ fatory Iyp\aIIa paa - Mate's Reeipt
arr - forged Iypaa'r paa o o' o py3 lre op'I -
eoe o - physial person dirty ate's Reipt
poa oIIIa - fied duty
ooa pra _ stok market
a
eTop - forwarding agent
pao-ao - x Works
opep - exportr
pao.paopoe o - Free Carrier
opIta olIIIia- export duty
pax - freight
IO
x IopoI?ro- legal entity
xHe _ theft
xpaelle - storage
p - fragile

ea - prie
IIIIIea - stoks; seurities
IIIIre a apallpoao pIIo - gilt-
dgd seurities
eI{Ie ya aalolvl ypol4 - floating rat
gilt
er - valuable
IITpaIII a - entral bank

aIIa - partial loss

aa'fl aap - partiular average
 o aope
eo L4IIa
Heather Ferlihia is a British-born gradate of Bir.
H ether Fer ! ichi BA (Hons)
minghanr Universit in ngland. After ears spent
teahing in England and Germany, she beame Head o.vllvlGiAL NGLls
of nglish at the International Business Shool in ooE o on,tEPolvty A}tolt,ly lKy
Germany, where she taught business subjets to se- oeet peaKop K. to
retaries, managers and undergraduats as well as Xyoxee| peao, a oo , pt
KoeoHa BeDKa ' Ko<aoa
examining for the Chamber of Commere.
ooo "aeco "oo
127299,o, . K p e ,. 18 / 5 . e .: 4 1 1- 6 8 - 8 6 ,9 5 6 - 9 . 2 1-
eep ep poa Beopa, ar ome page:www.eksmo.ru -mai|:info@eksmo.ru
)I(eaoII a pe yIIBepTe. oe ooa opron" *"g72 c|||o,g oBaPa.
(Kclgo-a":

eox eT peoaBall Ar, a 3aTe ooo . T t. o'. 1427oo, Mocoao . . e H p - ,. B oe,

e oae oe . , . 1, oo aa t e .4 1 1- 5 0 - 7 4 .
epa oIIa BotaBa oTeeIIeaoo -mai|:reeptio@eksmo-s|e.ru

IIdaMeyapoo e-roJII epa, o acopn Kt'g u},qaecoa cop , ono& oaee:

.eepPe: ooo C3Ko, p- oyxoooopot,. 84.
e peoaBaa eoo olvlepe at- e. oea pea av||4 (812\ 265-44-80/81/82.

cl< epeTape, eeIIoB IyIIoB'
a Tarr peTaBa Heeyro Topoy aay
a epaol{Ix tsaea.
t|xe tlooPoe: ooo ,"co HHD,y' apaaBopooa,. 3.
e .(8312)72 - 6 . 7 0 .
B a: ooo .HKn Kaa',y. pepa,. 5. e. (8435)70-4o-45/46'
pe; ooo -P.aapan, p- Kpoa, ,.75/1' epa"'.. (846)269-66.70.
Epyp; ooo .P.aepy',y. 1p6aca, ' 24a.
e .(343)378 - 4 9 - 4 5 .
K e e : ooo "o. a ao, y . y oa, . 9 . e . / aK c:(0 4 4 )5 3 7 . 3 5 - 5 2 .
2
o oe: Topooepeaecoooo t "o-paan'y' oa,.
e . / a(032 )2 4 5 . 0 0 - 19 .
Meoooa opro& uralu aco' oapau co.a,:
.1
117192, oKa, ypcp-,. 2/.l. e./aKc:(495)41 1-50.76.
127254, g oca,y . o6p o oa'. 2 . T e . :(4 9 5 )7 4 5 - 8 9 - 1 5 , 7 8 0 . 5 8 - 4 .
opao aoap:www.eksmo.ka.ru e.mi|:kn@eksmo-s|e'ru
o accopu e nPotKu uaeca co Kc.lo' :
B luloce e ara3o (o x':
aa_ Moca,yxapea., 12 . Te. 937-85-81.
|-{epal
Hopao arHaxdotxt"o e. 780-58.81'
r.eeppe e. l aro ooo:
e . (8 12 ) 3 1 0 - 2 2 . 4 4 .
"aa a He o",. 3 .
o opoca
. page|ea Pa B 'a uaebcBa .cou
o6patac a pema oe. Te. 4| | -68.74.
oco eac oo|xoaxe 14'04.2006'
op 84x 108 ]72. e aooce H a. y . n. c ' ne. ' 1 0 , 0 B .
o. ax 3 000 K. 3a Ns 10686.

oeao B oHoMcooe aeco

peoseHloBoB oAo,.ya op''.
00600' ' , p - e a, 1 0 9 .
KHa, aBopo|1' Koopo Bec Hocl4-
e 1IKa' pea?Haea 6u3ece-
aM' epBoua' eKpeapfl M' crye-
a gIKoBIX BwoB BeM eM, Ko,
IBa acK|4 lK, CpefoIc 6o-
nee oq1oBaeHo oHaKoMl|| c eo-
MHo'lo'|e,'\coeMo B KoMMep!4'
e pee Ha \BaIne a^oBoo
peMeoo e',Ka, KHa oBae
eKoope oHoBolloaaloe p!|4I1l'
pMee^ne B MeHapoHo Ko^'|-
epecKo paKI|Ke. BMece eM oa
eco^neo oKK oeo B Ka-
eBe npaBo|'|Ka ceanoB,
paoa'| oa
n epeBoa. KHI4a ope'Ipo4aa a
p'|a!.!cK|4 BapaH amcKoo tIKa
1aa B aBopco peat.

'ilJ