Back Office Procedure for export Projects

1) Award of Project: Project has been awarded by tendering process. 2) Advance/ Performance BG:

3)

4)

5) 6) 7)

1) Advance and performance BG to be arranged as per contract specifications-CF 2) To be submitted to customer Signing of Contract: Corporate Finance: 1) DPX 1 to be prepared and required to sent to CF immediately to obtain bankers approval. 2) Cash Flow of the total project required to be prepared and sent to CF for hedging (Forward cover) 3) DPX 3 to be prepared and to be sent to CF as a process of reporting about project to the bankers in every quarter. LC opening procedure: LC opening request to be made to customer if any. Procurement of goods: Preparation of QES/ Releasing PO To be done by technical team Cargo Movement from India to Srilanka: Ex-Work BY SEA

1)

Logistics India team make follow up with the vendor about readiness of the cargo as per the delivery dates agreed & mentioned in the purchase order.
1.

Logistics India team requests the vendor to provide the draft packing list
2.

Logistics India team on receipt of the draft packing list from the vendor, sends the enquiry to the several forwarders in order to get the best quote & also to know number & type of containers required.
3.

Logistics India team finalizes the quote & ask the forwarder to provide the available vessel details during the
4.

readiness period of the cargo with estimated departure date at loading port & estimated date of arrival at discharge port Logistics India team on receipt of the vessel details from the forwarder, informs the vendor about the same & asks them to give the material ready accordingly.
5.

Vendor forwards the final invoice & packing list to Logistics India team as soon as the material is ready & informs to arrange for shipment.
6.

Logistics India team on receipt of the final packing list & invoice from the vendor, applies for CT1 Bond from the Excise department.
7.

Logistics India team receives CT1 Bond form from the excise department in 2-3 working days depending upon the availability of the excise officer.
8.

Logistics India team sends the original CT1 Bond form received from the excise department to the vendor along with the duly signed Blank ARE1-form and Dispatch Instruction for preparation of documents to remove the cargo from the vendor factory .
9.

Vendor sends the copy of ARE1 form by fax to Logistics India team after filling all the details in ARE1 form for checking, and arranges the Excise sealing of the material.
10.

Logistics India team gives the confirmation of ARE1 form immediately to the vendor.
11.

Logistics India team provide the documents like invoice, packing and Despatch instruction (for preparation of shipping documents) to the forwarder & instructs for placement of containers at the vendor factory.
12.

Vendor prepares the ARE1 form (Original & Duplicate copies) with duly stamped & signed & handover the documents to the forwarder.
13.

Vendor arranges for stuffing & excise sealing of the material /containers in its factory itself.
14.

Local forwarder at PORT OF LOADING arranges for transport of containers from factory to the nearest port & thereafter arranges for all the documentation formalities custom formalities at loading port.
15.

Logistics India team ensures that the containers are loaded in the planned vessel & send the necessary shipping instructions to the forwarder for release of Bill of Lading, certificate of origin, freight certificate.
16.

Local forwarder at PORT OF LOADING sends us the draft copy of bill of lading, certificate of origin & freight certificate to Logistics India team for approval.
17.

Logistics India team approves the draft copy & ask the forwarder to release the same immediately.
18.

Local forwarder at PORT OF LOADING provides the actual information about the sailing date of the vessel with its appx. Estimated arrival date at discharging port. Along with the necessary information all the documents like Bill of lading, Certificate of origin, freight certificate etc is sent to Logistics India team immediately by courier.
19.

Logistics India team on receipt of the documents from the forwarder, send this documents to Logistics Srilanka team with vessel information etc.
20.

Logistics POS team gives the information to nominated local forwarder with the original documents on receipt for import custom clearance in Srilanka.
21.

Logistics POS team applied for Bank endorsement, Ministry clearance & insurance certificate.
22.

POS (Project office Srilanka) Local forwarder completes the custom formalities within 3-4 days after arrival of goods, examination/inspection of cargo and other custom formalities & informs the Logistics POB team about the amount of custom duty.
23.

Logistics POS team send the documents to the Client with the figure of duty amount to be paid for custom clearance.
24.

Client prepares the Demand Draft / Cheque in favor of Customs & handover the same to Logistics POB team
25.

Logistics POS (Project office Srilanka) team send the Demand draft / Cheque of custom duty to POB Local forwarder.
26.

POS (Project office Srilanka) Local forwarder submits the custom duty cheque /DD with customs & takes the delivery order for taking out the cargo from customs authority.
27.

Logistics POS team provides the delivery instruction to the POB Local forwarder
28.

POS (Project office Srilanka) Local forwarder within 23days delivers the goods to respective site/warehouse.
29.

BY ROAD Logistics India team make follow up with the vendor about readiness of the cargo as per the delivery dates agreed & mentioned in the purchase order.
1.

Logistics India team requests the vendor to provide the draft packing list.
2.

Logistics India team on receipt of the draft packing list from the vendor, sends the same to its Nominated forwarders in order to know number & type of trucks required.
3.

PORT OF LOADING Local Forwarder on the basis of the packing list inform the Logistics India team about the number of trucks required for the consignment
4.

Logistics India team ask the vendor to provide the exact date of readiness of the material in order to inform the forwarder about the placement of trucks for onward dispatch of material to Petrapole (India) of Loading Border.
5.

Vendor forwards the final invoice & packing list to Logistics India team as soon as the material is ready & informs to arrange for shipment.
6.

Logistics India team on receipt of the final packing list & invoice from the vendor, applies for CT1 Bond from the Excise department.
7.

Logistics India team receives CT1 Bond form from the excise department in 2-3 working days depending upon the availability of the excise officer.
8.

Logistics India team sends the original CT1 Bond form received from the excise department to the vendor along with the duly signed Blank ARE1-form and Dispatch Instruction for preparation of documents to remove the cargo from the vendor factory.
9.

Vendor sends the copy of ARE1-form by fax to Logistics India team after filling all the details in ARE1 form for checking.
10.

Logistics India team gives the confirmation of ARE1 form immediately to the vendor.
11.

Logistics India team instructs the forwarder for placement of trucks at the vendor factory.
12.

Vendor prepares the ARE1 form with duly stamped & signed & handover the documents to the forwarder.
13.

Vendor arranges for stuffing & excise sealing of the packages in its factory itself.
14.

PORT OF LOADING Local forwarder arranges for transport of the cargo from factory to Petrapole (India) of loading border including all the documentation formalities.
15.

Logistics India team informs the Logistic Srilanka team about the dispatch & the appx. Date of the arrival of the truck at Petrapole (India) of loading border.
16.

PORT OF LOADING Local forwarder sends us the Lorry Receipt, certificate of origin & freight certificate to Logistics India team for approval.
17.

Logistics India team approves the copy & ask the forwarder to release the same immediately.
18.

Logistics India team on receipt of the documents from the forwarder, send this documents to Logistics Srilanka team with all the truck details etc.
19.

Logistics POS team gives the information to nominated local forwarder about the same & ask him to transport the material from Petrapole (India) of Loading border to Benapole (Srilanka) of Loading border.
20.

POS Local forwarder arranges for transport the consignment from Petrapole (India) of Loading border to Benapole (Srilanka) of Loading border
21.

POS Local Forwarder arranges for ministry clearance, Bank endorsement, Insurance Port of Loading, Assessment at Border & inform the custom duty amount to POS local forwarder
22.

Logistics POS team send the documents to the Client with the figure of duty amount to be paid for custom clearance.
23.

Client prepares the Demand Draft / Cheque in favor of Customs & handover the same to Logistics POS team
24.

Logistics POS team send the Demand draft / Cheque of custom duty to POB Local forwarder.
25.

POS Local forwarder submits the custom duty cheque with customs & takes the delivery order for taking out the cargo from customs authority.
26.

Logistics POS team provides the delivery instruction to the POB Local forwarder
27.

POS Local forwarder within 2days delivers the goods to site/warehouse

28.

2)
1.

FOB

Logistics India team make follow up with the vendor about readiness of the cargo as per the delivery dates agreed & mentioned in the purchase order. Logistics India team ask the vendor to provide the final packing list around 15days in advance to arrange for the break bulk or container vessel.
2.

Logistics India team on receipt of the final packing list from vendor, floats the enquiry in the market to different forwarders & asks them to quote in next 5days.
3.

Logistics India team finalizes the quote & ask the forwarder to provide the available vessel details during the readiness period of the cargo with estimated departure date at loading port & estimated date of arrival at discharge port.
4.

PORT OF LOADING Local forwarder provides the vessel details with its agent address, ETA Loading Port & appx. ETA discharge port to the logistics India team
5.

Logistics India team on receipt of the vessel details from the forwarder is communicated to the vendor to make arrangements accordingly to transport the cargo at port.
6.

Vendor accordingly transport the cargo at port for the given vessel & sends all the documents like commercial invoice, packing list, certificate of origin, forwarder cargo receipt, test certificate if any etc to the logistics India team
7.

Logistics India team on receipt of the original documents, sends these documents along with the original bill of lading & Vessel details received from the forwarder to Logistics Srilanka team.
8.

Logistics POS team gives the information to nominated POS local forwarder with the original documents on receipt for import custom clearance in Srilanka.
9.

POS Local forwarder completes the custom formalities within 7days after arrival of goods, examination/inspection of cargo and other custom formalities & informs the Logistics POB team about the amount of custom duty.
10.

Logistics POS team send the documents to the Client with the figure of duty amount to be paid for custom clearance
11.

Client prepares the Demand Draft / Cheque in favor of Customs & handover the same to Logistics POS team
12.

Logistics POS team send the Demand draft / Cheque of custom duty to POB Local forwarder
13.

POS Local forwarder submits the custom duty cheque with customs & takes the delivery order for taking out the cargo from customs authority
14.

Logistics POS team provides the delivery instruction to the POS Local forwarder
15.

POS Local forwarder within 2days delivers the goods to site/warehouse

16.

3)
1.

CIF

Logistics India team make follow up with the vendor about readiness of the cargo as per the delivery dates agreed & mentioned in the purchase order. Vendor informs the Logistics India team about the exact readiness date of the cargo with details of vessel planned.
2.

Logistics India team ask the vendor to forward the original shipping documents like Commercial Invoice, Certificate of origin, Bill of Lading, Freight certificate etc within 7days of sailing of the vessel.
3.

Vendor forwards the required shipping document to Logistics India team with full vessel details mentioning its ETD Loading Port & ETA Discharge Port
4.

Logistics India team on receipt of the shipping documents & vessel details from the Vendor communicates to Logistics POS Team & sends the original shipping documents immediately for custom clearance at discharge port
5.

Logistics POS team gives the information to nominated POS local forwarder with the original documents on receipt for import custom clearance in Srilanka.
6.

POD Local forwarder completes the custom formalities within 7days after arrival of goods, examination/inspection of cargo and other custom formalities & informs the Logistics POD team about the amount of custom duty.
7.

Logistics POS team send the documents to the Client with the figure of duty amount to be paid for custom clearance 9. Client prepares the Demand Draft / Cheque in favor of Customs & handover the same to Logistics POS team
8.

Logistics POS team send the Demand draft / Cheque of custom duty to POB Local forwarder
10.

POS Local forwarder submits the custom duty cheque with customs & takes the delivery order for taking out the cargo from customs authority
11.

Logistics POS team provides the delivery instruction to the POS Local forwarder
12.

POS Local forwarder within 2days delivers the goods to site/warehouse diagram.
13.

8. Documents are to be collected from Freight forwarder 9. Invoice is required to be generate in system 10. Retention/Advance adjustment required to be sent to Sips 11. Documents (required as per LC terms) to be submitted to CF/banks/Sips 12. On receipt of payment sips to be intimated for the adjustment against forward cover. For Civil & Erection works
1) On receipt of conformations from site commercial regarding

site billing (RA bills) , invoice to be generated in the system. 2) Retention/Advance adjustment required to be sent to Sips

Site Commercial

1) Site commercial prepares invoice locally as per work certification by the customer. 2) Collection to be made locally and submit in local bank 3) Intimation is required to be made to back office commercial

Logistic points
1) When Shipments are under LC Step 1: When materials are supplied under LC, then all the following original documents are required to submit with our bankers. Our bankers shall be sending these documents to the customer bankers (where the LC has opened by the customer) with a copy to project office. 1. Invoice 2. Details of commodity description, quantity, unit price, total price etc with reference to items in the price schedule. 3. Bill of Lading 4. Insurance Certificate 5. Manufactures Guarantee 6. Inspection Certificate/Dispatch clearance 7. Packing List # Above mentioned documents are required as per KKTrP Project LC condition. These conditions are may differ from LC to LC. Step 2: After these documents reached at customers banker, our clearing agent present the photocopy of the following documents with the customer banker to collect the original 1st BL/AWB and other clearance from bankers to clear the material. 1) AWB/BL (Photocopy) 2) Invoice (Photocopy) 3) Packing List (Photocopy) There are 2 types of clearance may occurs, Case 2 (i) : The vessel arrives after the original documents reaches to the customer bankers.

This is very ideal condition for any given time where material shipped against LC. In this case we require only necessary endorsements by the customer bankers and the customer. Then clearing agent collects the original BL/AWB from the customer bankers and clears the material and hand over the same to the destination. Money transfers takes place from the customer bankers to our banker immediately after giving the endorsements to the documents. Step 2 (ii) : The vessel arrives before the original documents reaches to the customer bankers This is the most common incidents always happen. For this cases customer has to issue an additional document named as SHIPPING GUARNTEE to our clearing agent to produce with the shipping liner and the custom authority. Shipping Guarantee is a financial guarantee equivalent to the value of invoice; customer has to give on behalf of us to the shipping liner to allow us to take delivery of the material without the original BL/AWB. Once the shipping guarantee issued by the customer, money transfers from customer bankers to our banker. Apart from the above we also need a confirmation from the main shipping liner to their local agent in Colombo in writing/e-mail to handover the material to our clearing agent, e.g. if the material has been sent from Mumbai by SCHENKER India Pvt Ltd, then a confirmation from them is required to their local agent SG Logistic here in Colombo to hand over the material to our clearing agent without a original BL/AWB and against a shipping guarantee. Note: All the documents under LC supply to be endorsed by the customer bankers to prove before custom authority that the transaction is backed by a payment and not a free supply to the country. For Clearing the Material shipped under LC
1) Invoice is required to submit to the customer to obtain a Custom

Exemption letter from the ministry of Trade and Foreign affaires before the actual dispatch of materials.

2) After dispatch of material copy of AWB/BL, Invoice and packing list

is required at project office to obtain the necessary clearances from the customer and its bankers. 3) All other original documents mentioned in step no 1 should be submitted to our bankers. Following precautionary measures are required at the time of preparation of documentation for these shipments are as follows. Consignee Address or Notified Party address should be the customer address. Consignor address should be either Siemens Ltd (If sending directly) or the senders address if it is a bought out item. Siemens Limited registered address with the Sri Lankan custom authority is Siemens Limited, 65 Jetawana Road, Colombo 14. Mentioning any other office addresses of Siemens may bring inevitable troubles. LC number must appear in the BL/AWB and Invoice. Proper description of goods must be mentioned in BL/AWB and Invoice, preferable same in both. If the fact is known that the vessel shall arrive before the original documents reaches to the customer bankers, then a proactively we should instruct our shipping liner in turn to instruct their local agent to release the material against shipping guarantee without BL/AWB. 2) When Shipments are not under LC Step 1: When materials are not supplied under LC, or a free supply following documents are required to clear the material and this copies should be send to project office in Sri Lanka. If shipment coming by air, 1) AWB (Photocopy) 2) Invoice (Photocopy) 3) Packing List (Photocopy) If shipment coming by ship,

1) B/L 1st copy in original is required if the sender not sending the 1st

copy of BL along with the material. 2) Invoice (Photocopy) 3) Packing List (Photocopy) Note: For free supply USD 1000 is the permissible limit. Beyond that supplier has to bear a penalty for sending material free of cost to the country. This may be treated as a gift tax in India. Following precautionary measures are required at the time of preparation of documentation for these shipments are as follows. Consignee Address or Notified Party address should be Siemens Limited 65 Jetawana Road Colombo 14 No other office address should not be mentioned in the invoice and packing list. No LC number should appear in the BL/AWB and Invoice. Proper description of goods must be mentioned in BL/AWB and Invoice, preferable same in both. 3) When materials coming under temporary import (known as CARNET) This applies for tools, instruments, and test equipments. They shall be coming under CARNET and, the utmost care should give on preparation of the packing list. No consumables shall be sent along with the tools invoice as they will remain/ will be consumed at site. Consumables shall either as part of the equipment to be installed. So payments will be out of LC or with a separate invoice free of charge.