Sunteți pe pagina 1din 6

\Session 1_2_3 (Detailed) Export Procedure and Documentation

Chapter Outlines: Introduction Understanding exports procedure. Understanding documents needed for export transactions. Electronic clearance of exports documents. Conclusion

Introduction
It is essential for an international marketer to understand the proper export procedure and documentation since he is selling his goods or services to someone beyond his home borders and both he and his buyer are governed by different legislative frameworks. While the set of documents and procedure followed to a hassle-free export transaction does not vary much from country to country, the present text has been designed with an assumption that the export transaction is to take place from an international marketer or exporter from India. A number of government/private/service agencies, such as Inspection/Insurance agencies, Customs and Excise authorities, Directorate General of Foreign Trade in India, banking institutions, clearing and forwarding agents, Reserve Bank of India, Shipping companies, Airlines, Trucking companies, Railways etc. regulates or facilitate the trade transaction between the seller from India and buyer overseas. The seller has to comply with the rules, regulations, and trade practices of all or some of these applicable entities. Similarly for receiving the payments or for transportation risk management, a seller from India an international marketer has to follow a well-defined international customary and regulatory framework of rules, regulations and procedures. In this context he has to be fully aware of the various legislations governing the home as well as host country. In case of India, the relevant laws/acts include the Export Import policy and Handbook of Procedures, Foreign trade (Development and Regulation) Act, 1992, Customs Act 1962, Foreign Exchange Management Act, 19999, Export (Quality Control and Inspection) Act 1963, Insurance Act 1938, Marine Insurance Act 1963, Central Excise Act 1944, etc. In addition, International Commercial Practices and Laws, such as The Carriage of Goods by Sea 1924, Uniform Customs and Practices for Documentary Credit (UCPDC) 1993, the International Commercial Terms 2000 etc. also have to abided.

Understanding Export Procedure


In order to understand a typical case involving following the proper export procedure we have to understand the process of a typical export transaction where the documents have

to be typically routed through banks in the sellers and buyers country. An export transaction entails identification of a buyer in the international market and getting an order first. The export contract has all the usual terms and conditions with regard to description of good, Price, Mode of Payment, delivery terms, payment terms, details of the origin and destination of goods, dimensions and weights of the cargo if already available, currency of the contract, validity of the contract, transportation costs, insurance costs, L/C terms if payment is through L/C etc. Based on the contract the seller supplies the goods, after receipt of the L/C. The C&F agent is appointed by the seller to carry out shipping services and customs formalities apart from other services as negotiated with him. Depending upon the terms of the contract the, cargo is handed over to the shipping agency against the receipt of the Bill of Lading. The goods can be claimed at the destination by the lawful holder of the Bill of Lading. Adhering to the international commercial practices the Bill of Lading is handed over to the buyer by the buyers bank only after the payment has been made or otherwise as stated in the contract. This process ensures the proper delivery of the goods to the right person and timely payment to the seller. Therefore it is of utmost importance for an international marketer about the exact procedure and documentation involved in this kind of export transaction. In order to avoid problems related to smooth flow of goods, getting timely proceeds for the goods supplied and to maintain a good relationship with the buyers, an International Marketer must follow these suggestions: The documents must be meticulously prepared. The time frame for filing the documents with intermediaries and govt. authorities must be adhered to. L/C terms must be carefully drafted (in the contract) and understood.

The person, chosen for carrying out the above documentation and procedure must be thorough with the export documentation and must possess the desired skills in this regard. The execution of the export shipment and receiving the payment involves a complex set of procedures. Hereby an exporter needs to come across a number of regulatory authorities and trade agencies. The very first step in export procedure involves compliance with the home countrys legal framework, arranging the export finance after the receipt of the order, readying the goods for export, appointing a C&F agent, arranging the cargo insurance & shipping space (by sea or by air), delivering the goods and documents to the C&F agent, customs and port procedures, preparing post shipment documents for submission to the bank, receiving the payment and export incentives, refunds etc where applicable. For the benefit of the readers, export procedure for a typical export transaction has been depicted in exhibit-1 below. Step 1 Legal compliance Registration with EPC Registration with sales tax department Registration with central excise department

Step-2

After receipt of order Shipping Formalities Customs/Port formalities

Arranging export finance

Readying the goods

Appointing the C&F Agent

Step-3

Arranging the insurance

Booking shipping space

Step-4

Customs Clearance

Port formalities

Step-5 Step-6

Shipping advice to buyer Presentation of the documents to the bank for securing the payment Claiming Incentives

Step-7

Exhibit-1: Export procedure for a typical export transaction.

Understanding documents needed for export transaction.


There are primarily two set of documents required for a typical export transaction 1. Pre-shipment document. 2. Post shipment documents. Pre-shipment documents deals mainly with arranging the pre-shipment credit, preshipment inspection, physical transfer of goods, customs/port formalities and compliance with rules and regulations of the home and host countries. The post shipment documents are required primarily for receiving the payment, arranging post shipment credit (if applicable), claiming the incentives, refunds, informing the RBI about the receipt of the payment etc. Many of the pre-shipment documents are also required for post shipment procedures. A list of pre-shipment documents is presented in exhibit 2 (Source: Standardized Pre-Shipment Export Documentation, Export Facilitation Committee of India, Ministry of Commerce, Govt. of India, 1990). A list of post shipment documents is presented in exhibit 3.

Pre Shipment Export Documents Commercial Documents Principal Commercial Invoice (incl. the one prescribed by the host country) Packing List. Certificate of Insurance (incl. policy). Certificate of Origin. Certificate of Inspection. Auxiliary Performa Invoice Shipping Instructions Intimation for inspection Application for the Certificate of Origin Letter to Bank for collection of payment from Buyer. Insurance declaration Shipping Order Exchange Control Declaration GR forms. Freight payment Certificate Shipping Bill/Bill of Export Port Trust copy of Shipping Bill/Export Application/Dock Challan Post Charges receipt Insurance Premium Payment Certificate ARE I / ARE II Forms Vehicle Ticket Regulatory Documents

Mates receipt Bill of Lading / Air Way Bill / Combined Transport Document. Bill of Exchange. Shipment Advice. Exhibit-2: Pre-shipment documents

Pre-shipment export documents are of two types Commercial Documents (which are used by the Customs of Trade in international commerce by exporters and importers in discharge of their respective legal and other incidental responsibilities under sales contracts) and Regulatory documents (which are prescribed by different Govt. Departments/Bodies for compliance of formalities under relevant laws. Commercial documents are further of two types Principal and Auxiliary. The principal documents are required for physical transfer of goods and their title from exporter to importer. And for realization of export sale proceeds. The auxiliary documents are required for preparation / procurement of Principal exports documents.

Post Shipment Export Documents Shipment advice docs Negotiation Docs (as per L/C terms) Commercial Advice Bill of Exchange (first and Second of Original GR Form (in duplicate) Full set of clean on board bill of lading (all negotiable and non negotiable as required) Export Order/contract copy Packing list Insurance policy (two copies) Consular and Customs invoice Bank certificate (as prescribed) L/C (Original) Exhibit-2: Post-shipment documents Incentive claim

Shipment advice Non-negotiable copy of Bill of Lading Commercial Invoice. Packing List.

For Excise rebate: Duplicate certified copy of ARE-1 and ARE-2 Non-negotiable copy of bill of lading or shipping bill. For duty Drawback: Drawback claim Performa Certified copy of commercial invoice Non negotiable copy of Bill of Lading.

Electronic clearance of exports documents: With the advances in information technology, the complex processing of export documents has been chiefly facilitated by the computerized generation and processing of export documents. A number for software packages are available for Indian exporters for preparation of pre-shipment and post-shipment documents. With the help of EC/EDI implementation of exports documents processing in various department under ministry of commerce as well as coordinated with agencies like Airport Authority of India, Export promotion Councils, RBI, Commercial Banks, Airlines, Railways and custom houses, it was never so easier before for an Indian exporter to carry out export documentation and procedures. What is required is a thorough understanding of the concept and contents of procedures and documents required for smooth export transaction. Further individual websites of different agencies also offers a smooth interface with the system for better integration. Conclusion: The export procedures and documentation is an integral activity of international marketing process. In an export transaction, the seller and buyer is governed by a complex set of regulatory framework of their own countries. A thorough understanding of the regulatory requirement not only of the home country but also the destination country is essential for an international marketer. Information technology has helped speed up the documentation process and makes it easier for an exporter to carry out all formalities in his own country as well as if required in the host country.

S-ar putea să vă placă și