Export Documentation

EXIM DOCUMENTATION &
PROCEDURE
By
Eknath Birari
Agenda
q How to set up Export Companies
q Export Sales Contract
q Terms of Shipments [INCOTERMS]
q Processing of Export Order
q Documentation: Overview
q Understanding Documents – Proforma Invoice,
Commercial Invoice, Packing List, Inspection
Certificate, Certificate of Origin, GSP Certificate,
Shipping Bill, ARE-1, Mate Receipt, GR/SDF, Marine
Insurance Policy, ECGC Policy, Bill of Exchange, Bank
Realisation Certificate, Bill of Lading and Airway Bill,
Special Consular Invoice, etc.
q Pre-shipment Inspection
How to set up Export
Companies
Preliminaries for starting export Business
q Setting up of an appropriate form of business

organisation - What should be the form of business
organisation?
q Choosing appropriate mode of operation – How one

wants to enter into the business?
q How to select name, design stationary including

catalogue?
q When and where to open a Bank Account?

Preliminaries for starting export Business
q How to obtain mandatory registration?

a.PAN
b.IEC
c.Registration for Digital Signature
d.RCMC
e.Registration with various agencies
q How to quickly respond to overseas enquiries and how

to project image?
q Electronic Data Interchange (EDI)

Setting up of an appropriate form of
business organisation
q What should be the form of business organisation?
§ Main types of business organisations prevailing in India are:

• Sole proprietorship,
• Partnership firm,
• Private limited company,
• Public limited company,
• Co-operative society,
• Trust, etc.
Choosing appropriate mode of operation
q How one wants to enter into the business?

Export business is mainly classified in three broad categories:
• Merchant exporters,
• Manufacturer exporters and
• Service exporters.
How to select name, design stationery
including catalogue?
q Selection of Name:
§ SIMPLE
§ It may signify PRODUCT/ACTIVITY/ SPECIALITY
q Designing of Stationery [Letterheads, envelopes,

visiting cards etc.]
§ Same colour combinations
§ Logo
§ Quality
§ Size
§ Appearance
How to select name, design stationery
including catalogue?
q Preparing of Product Catalogue/Literature/CD
§ Colour combination
§ Avoid over crowded literature
§ Gives information about products/services offered
§ Technical details, if necessary
q Creating Website (Online Home Page)

§ Vision of the company
§ List of Products/services. In case of products, display clips of
the same.
§ List of Group Companies, branches etc.
Preliminary Registrations
q When and where to open a Bank Account?
An exporter/importer should have a current account with an bank
having a foreign exchange department [Authorised Dealer].
q How to obtain mandatory registrations?

a. Permanent Account Number (PAN):
Exporter should make an application to the Income – Tax
Authorities to allot a Permanent Account Number (PAN).
b. Importer-Exporter Code Number (IEC):

• FTP lays down IEC number as basic eligibility criteria to
become Exporter/Importer.
• It is allotted by Regional Authority i.e. Joint Director
General of Foreign Trade.
Importer-Exporter Code
§ An application for grant of IEC number shall be made by
Registered/ Head Office of applicant, except EOUs and SEZ
units to concerned RA in ANF 2A with documents prescribed
therein.
§ As per Policy Circular No. 15/2006 Dtd. 27.07.2006 an applicant

(exporter/importer) may now choose one of the two options for
application submission:
• File an online application and submit a physical copy of the
application by taking a printout of the online application.
• Submit a physical copy of the application directly at the
regional DGFT office.
q Check sheet for application for issue of IEC no.
§ Application in ANF 2A
§ Declarations in Part D of Aayaat Niryaat Form in duplicate on
letterhead.
§ One copy of the application must be submitted.
§ Each individual page of the application has to be signed by the
applicant.
§ Demand Draft of Rs.1000 evidencing payment of application fee
in favour of the concerned regional office of DGFT. Money can
also be paid through Electronic Fund Transfer (EFT) and TR 6A
challan by cash.
§ Certificate from the Banker of the applicant firm in the
specified format as given in Part B (Appendix 18 A) of ANF 2A
q Check sheet for application for issue of IEC no.
§ Self certified copy of Permanent Account Number (PAN) issued
by Income Tax Authorities.
§ Two copies of passport size photographs of the applicant.
§ Photograph on the banker’s certificate should be attested by
the banker of the applicant.
§ Self addressed envelope and stamp of Rs.30.
§ Envelope mentioning name and address of the Bank with stamp
of Rs.30.
§ Self certified copy of Partnership Deed/ Memorandum and
Article of association, if any.
§ Self certified copy of RBI approval in cases where non resident
interest/holding in the firm/company exists with repatriation
benefits.
§ EXPORTER’S / IMPORTER’S PROFILE
• Each importer/exporter is required to file
importer/exporter profile once with the Regional Authority
in ‘ANF 1’ (Aayaat Niryaat Form).
• RA shall enter the information in database so as to dispense
with the need for asking the repetitive information.
§ IDENTITY CARDS
• To facilitate collection of Authorisation and other
documents from DGFT Head Quarters and RA, identity cards
(as in Appendix 20B, valid for 3 years) are issued by the
concerned Regional Authorities to the proprietor/ partners/
directors and the authorised employees (not more than
three), of the importers and exporters, upon application as
in Appendix 20A of HBP Vol. I.
Registration for Digital Signature
§ A Digital Signature is the electronic equivalent of a physical
signature and can be used to electronically sign any document
or transaction. One needs to have a valid digital certificate to
create a digital signature.
§ DGFT has authorised various agencies to issue a Digital

Signature Certificate with a validity of one or two years. [Safe
Exim, Tech Options, etc.]
§ With a Digital Signature one can apply for licenses

electronically with the DGFT and digitally sign his online
license application.
Registration for Digital Signature
§ Digital Signatures are legally admissible in a Court of Law, as

provided under the provisions of it.
§ W.e.f. 01.04.2004, no on-line application is possible if an IEC

holder does not opt for a digital signature. Application fee is
also to be paid through the Electronic Fund Transfer. Moreover,
50% reduction in application fees is granted to only those who
are using both Digital Signatures as well as EFT route.
Registration-Cum-Membership
Certificate (RCMC)
§ RCMC means the certificate of registration and membership
granted by an Export Promotion Council/ Commodity Board/
Development Authority or other competent authority as
prescribed in the Foreign Trade Policy or Handbook (Vol.1).
§ An exporter desiring to obtain a Registration-cum-Membership

Certificate shall declare his main line of business in the
application, which shall be made to the Export Promotion
Council (EPC) relating to that line of business.
§ However, a status holder has the option to obtain RCMC from

Federation of Indian Exporters Organization (FIEO). The service
exporters (except software service exporters) shall be required
to obtain RCMC from FIEO.
List of few EPCs/Commodity Boards
q Agricultural and Processed Food Products Export Development

Authority (APEDA)
q Basic Chemicals, Pharmaceuticals & Cosmetics Export Promotion
Council
q Chemicals and Allied Products Export Promotion Council (CAPEXIL)
q Coffee Board
q Coir Board
q Electronics and Computer Software Export Promotion Council
(ESC)
q Engineering Export Promotion Council
q Export Promotion Council for EOUs and SEZ Units
q Federation of Indian Export Organisations (FIEO)
List of few EPCs/Commodity Boards
q The Gem & Jewellery Export Promotion Council

q Export Promotion Council for Handicrafts
q The Handloom Export Promotion Council
q The Indian Silk Export Promotion Council
q Pharmaceutical Export Promotion Council
q The Rubber Board
q Spices Board
q Tea Board
q Tobacco Board
q Wool & Woollens Export Promotion Council
Registration with various Agencies
i. Registration for legal identity :-
Exporter has to get his organization registered under
respective acts/authorities such as:-
• A sole proprietor - The Shops and Establishments Act or
take permission from local authorities, such as Municipal
Corporation, if required.
• A partnership firm - Indian Partnership Act, 1932.
• A Joint stock company - Indian Companies Act, 1956
• A Co-operative Society - The Co-operative Societies Act,
1912.
• A Trust - Indian Trust Act, 1882
ii. Registration for manufacturing activities
a. Small Scale Industry
b. Industrial Licensing
c. Tiny Sector/Enterprises
d. Khadi Village Industries Commission
iii. Registration with Central Excise Authorities:-
Goods meant for exports are exempt from Central Excise
duty. To avail exemption from payment of excise duty on
export goods, exporter has to obtain C.Excise
Registration.
There are two options to avail such benefit:
a. Export under Rebate claim - Exporter has to pay excise
duty at the time of clearance and on exportation can
claim rebate of excise duty paid.
b. Export under Bond - In this case goods are cleared
under Bond and there is no need of payment of excise
duty.
iv. Registration with the Customs Authorities (BIN)
§ Exporters have to obtain PAN based Business
Identification Number (BIN) from the DGFT prior
to filing of shipping bill for clearance of export
goods.
§ Under the EDI System, PAN based BIN is received
by the Customs System from the DGFT online.
v. Registration with VAT Authorities

Goods which are to be shipped out of the
country for export are eligible for exemption
from both VAT and Central Sales Tax for this
registration with VAT Authorities is required.
vi. Registration with Service Tax Authorities
§ Service tax is an indirect tax levied under the Finance Act,
1994.
§ At present, there are approximately 96 categories of
services taxable under the service tax net.
§ Service Tax is levied at a uniform rate of 12% + 2%
Education Cess + 1% Secondary and Higher Education Cess
on services liable to service tax under Finance Bill 2007.
vi. How to quickly respond to overseas enquiries and how to
project image?
• Strategy in Export and Import Correspondence
• When to reply
• Means of reply
vii. Electronic Data Interchange (EDI)

• EDI is the modern mode of transfer of documents.
• It is direct electronic transmission, computer to
computer of standard business forms such as purchase
order, advance, shipping notices, invoices and the like
between two organizations.
Contd…….
• The five key elements of EDI are
1. Electronic Transmission,
2. Standards Business Documents,
3. Predefined format,
4. Business application and
5. Trading partner.
• It increases the profits by lowering the cost of the

business process and increases the marketing share by
providing an improved service to customers.
• The Indian Government has also fallen in line with the

requirements of International Trade and has introduced
computerized processing of documents in various matters
relating to international trade.
Contd…….
• EDI applications can help with their wide range of
business application systems for different industries,
which include:
» Application for trade permits from government
agencies.
» Bidding for export quotas from regulatory bodies.
» Filing of corporate returns with relevant
authorities.
» Submission of claims to insurance companies.
» Bill payment and collection with banks and
financial institutions.
» Order placement and invoicing with trading
partners.
Export Sales Contract
q What is Export Sales Contract?
§ Agreement between buyer and seller, stipulating
each and every details of the transaction.
§ Legally binding document.
§ It reduces the probabilities of disputes & differences

as it fixes the role and responsibilities of each party.
q Terms and Conditions:
§ While drafting the sales contract one must ensure the
following:-
1. Coverage is complete.
2. Maximum clarity.
3. Future probability to be provided.
4. Trade practices.
5. Law of both countries
6. Need of both parties.
§ There should not be any ambiguity regarding the exact

specifications of goods and terms of sale including export price,
mode of payment, storage and distribution methods, type of
packaging, port of shipment, delivery schedule etc.
§ Following standard terms and conditions are covered in an
Export Sales contract: -
• Name & address of both the parties.
• Contract Number & Date, place
• Description of goods, quantity and quantity
• Product Standards and Technical Specifications of goods.
• Inspection/certification
• Total Value of Contract
• Terms of delivery (F.O.B./C.F.R./C.I.F. etc.),
• Period of Delivery/Shipment, part shipment, Trans-
shipment.
• Terms of payment:- L/C, D/A, D/P, advance payment,
Amount/Mode & Currency
Contd…..
• Taxes, Duties and charges
• Packing, Labeling, Marking, etc.
• Brokerage/commissions and discounts
• Licences and Permits
• Insurance Requirements, Certificates of Insurance
• Documentary Requirements
• Performance guarantee
• Signature by all parties to the contract.
• Force Majeure of Excuse for Non-performance of contract
• Remedies
• Arbitration.
§ Standard Export Sales Contract forms are also available. These

can be used as it is or with some modification as per individual
need.
Terms of Shipment
[INCOTERMS]
INCOTERMS 2000
q INTRODUCTION
In their sales contract buyer and seller agree on the

conditions of sale : payment on the one hand and
delivery on the other. These terms determine at what
precise location the ownership of the goods is
transferred from seller to buyer and when/how
payment will be done. In international trade a
universal set of rules on delivery has been developed
over the years. It is called INCOTEMRS.
Incoterms 2000
Group E EXW Ex Works
Departure
q
Group F FCA Free Carrier
Main carriage unpaid FAS Free alongside ship
FOB Free on board
Group C CFR Cost and Freight
Main carriage paid CIF Cost, Insurance, Freight
CPT Carriage Paid to
CIP Carriage and Insurance Paid to
Group D DAF Delivered at Frontier
Arrival DES Delivered Ex Ship
DEQ Delivered Ex Quay
DDU Delivered Duty Unpaid
DDP Delivered Duty Paid
(Note, that when the Incoterms indicate a certain Point or “…..,” the point
of destination or origin must be mentioned)
INCOTERMS 2000
q The Incoterms divide costs and risks

The Incoterms of trade have been designed to clarify
obligations of both parties, the buyer and the seller.
Principally, these are:
The seller must: The buyer must:

Provide the goods Pay the price as agreed
according to the contract upon
Contd….
INCOTERMS 2000
In order to finalise the transaction, both parties will

have to perform certain tasks, like:
Arrange for licences, Arrange for licences,

Authorisation and formalities Authorisation and formalities
Arrange for shipment Arrange for shipment
Arrange for delivery Accept delivery
Bear the risks for his activities Bear the risks involved in his
contractual activities.
Source: Guide to Incoterms, ICC Paris

INCOTERMS 2000
q EXW = EX WORKS (… named place)
Cost of Goods plus cost of Export packing and marking
In this term the seller delivers the goods by keeping it ready in
deliverable state at the seller's place or another named place. This
named place can be factory/godown or manufacturing unit. In this
term seller does not clear the goods for exports nor goods are loaded
on vehicle.
q FCA = FREE CARRIER (… named place)

Cost of Goods plus cost of Getting goods to railway station or
truck for transportation to port
This term refers to seller's responsibility to deliver the goods , cleared
for export, to the carrier appointed by the buyer at the named place.
In this term the place of delivery is very important. If the delivery is
at sellers place's then he is responsible for loading. If the delivery
occurred at any other place, the seller is not responsible for
unloading. This term can be used for all modes of transport as well as
multimodal.
INCOTERMS 2000
q FAS = FREE ALONGSIDE SHIP (…named port of
shipment)
Cost of Goods plus cost of Transport to port and
getting goods alongside ship
In this term when the goods are placed alongside the
vessel at the named port of shipment it will be
considered that the seller has completed the delivery.
The buyer has to bear all risks of loss or damage to the
goods and all costs from this point of time. However
the seller must clear the goods for the purpose of
export. This term can be used only for inland waterway
transport or shipment by sea. It is not used when it is
air shipment.
INCOTERMS 2000
q FOB = FREE ON BOARD (… named port of shipment)
Cost of Goods plus cost of Getting goods on board
and preparing shipping documents
This is the most popular term and is widely in use. FOB
means that the seller delivers when the goods pass the
ship's rail at the named port of shipment. Under this
term the buyer has to bear all costs and risk of loss of
damage to the goods from that point. This term
requires the seller to clear the goods for exports. This
term is used only for sea or inland waterway transport.
It is not suitable for shipment by air.
INCOTERMS 2000
q CFR = COST AND FREIGHT (… named port of
destination)
Cost of Goods plus cost of Freight cost (port to port)
Earlier this term was popularly known as C&F or CNF.
CFR means the seller must pay the cost and the freight
necessary for the goods to reach at the named
destination. However, the risks of loss or damage to
the goods after the time of the delivery is on buyers
account. The seller is required to clear the goods for
exports. This term can be used only for sea and inland
waterway transport.
INCOTERMS 2000
q CIF = COST INSURANCE AND FREIGHT (… named port of
destination)
Cost of Goods plus cost of Marine Insurance
“Cost, Insurance and Freight” means that the seller, delivers when
the goods pass the ship’s rail in the port of shipment. The CIF price
refers that it covers the cost of the goods, freight necessary to bring
the goods to the named port of destination and also marine
insurance. Compared to the previous term, CFR the seller contracts
for the insurance and pay the insurance premium. It will be essential
for the buyer to know that under the CIF term the seller is required
to obtain the insurance only on minimum cover. If the buyer wishes
to have more protection then he should make his own insurance
arrangement extra or should specify to the seller at the time of
contract.
In this term the seller must clear the goods for exports and the buyer
must arrange necessary clearance for import. This term can be used
only for sea and inland water transport.
INCOTERMS 2000
q CPT = CARRIAGE PAID TO (… named place destination)
“Carriage Paid To” means the seller delivers the goods to the carrier
nominated by him but the seller must in addition pay the cost of
carriage necessary to bring the goods to the named destination. This
refers to the fact that all the risks and any other cost occurring after
the goods have been delivered will be on buyer’s account. This term
is used for all modes of transport including multimodal transport.
q CIP = CARRIAGE AND INSURANCE PAID TO (…named place of

destination)
“Carriage and Insurance Paid To” means that the seller delivers the
goods to the carrier nominated by him, but the seller must in
addition pay the cost of carriage necessary to bring the goods to the
named destination. This means that the buyer bears all risks and any
additional costs occurring after the goods have been so delivered.
However, in CIP the seller also has to procure insurance against the
buyer's risk of loss of or damage to the goods during the carriage.
INCOTERMS 2000
q DAF = DELIVERD AT FRONTIER (… named place)
This term is used when goods are to be delivered at land frontier,
irrespective of the mode of transport. "Delivered At Frontier" means
the seller delivers when the goods are placed at the disposal of the
buyer on the arriving means of transport not unloaded, cleared for
exports but not cleared for import at the named point and place at the
frontier, but before the customs border of the adjoining country.
q DES = DELIVERD EX SHIP

Cost of Goods plus cost of Putting goods at disposal of customer on
board vessel at port of destination
“Delivered Ex Ship” means that the seller delivers when goods are
place at the disposal of the buyer on board ship not cleared for import
at the named port of destination. In this term all the cost and risk in
bringing the goods to the named port of destination before discharge is
on seller. This term can be used only when the shipment is by sea or
inland waterway or multimodal transport in the vessel at the port of
destination.
INCOTERMS 2000
q DEQ = DELIVERED EX QUAY (… named port of destination)
Cost of Goods plus cost of Unloading charges at port of destination
“Delivered Ex Quay” means that the seller delivers when the goods are
placed at the disposal of the buyer not cleared for, import on the quay
(wharf) at the named port of destination. The seller has to bear costs
and risks involved in bringing the goods to the named port of
destination and discharging the goods on the quay (wharf). The DEQ
term requires the buyer to clear the goods for import and to pay for all
formalities, duties, taxes and other charges upon import.
INCOTERMS 2000
q DDU = DELIVERED DUTY UNPAID
“Delivered Duty Unpaid” means that the seller delivers the goods to
the buyer, not cleared for import, and not unloaded from any arriving
means of transport at the named place of destination. The seller has to
bear the costs and risks involved in bringing the goods thereto other
than where applicable any duty for import in the country of
destination. Such duty has to be borne by the buyer as well as any
costs and risks caused by his failure to clear the goods for import in
time.
INCOTERMS 2000
q DDP = DELIVERED DUTY PAID (…named place of

destination)
Cost of Goods plus cost of Payment of duties and
transport to customer
“Delivered Duty Paid" means that the seller delivers the
goods to the buyer, cleared for import, and not unloaded
from any arriving means of transport at the named place
of destination. The seller has to bear all the costs and
risks involved in bringing the goods thereto including,
where applicable, any duty for import in the country of
destination.
INCOTERMS 2000-Chart of Responsibility
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
? ? ? ? ? ? ? ? ? ? ? ?
INCOTERMS 2000
q Incoterms 2000 – an example
A customer in Hanover, Germany, asks for a quotation for 3000
pairs of shoes, to be delivered DDP at his warehouse. You have
decided on a unit selling price of $2, giving a total nominal price of
$ 6000 for the goods when sold domestically. For export you will
have to calculate with an additional set of costs which are involved
in making them physically available to your customer.
What are the additional costs of getting the goods from your
factory in (e.g.) Agra, India, to the customer? How (*) is your
quotation affected by the terms of delivery?
(*) In this calculation example, all costs are hypothetical.

INCOTERMS 2000
If you Your price should Additional Your total price

quote: include: costs: is:
EXW Ex-works Agra 300 6300
Export packing, marking
crates with shipping
marks
FCA Free on Carrier at Agra 100 6400
station. Carriage and
insurance for delivery
to railway station by
road transport including
insurance
INCOTERMS 2000
FAS Free alongside ship at 310 6710

JNPT port. Rail
transport to port
(including insurance)
and getting goods on
the quay alongside
ship.
FOB Free on board JNPT 100 6810
Port. Dock dues,
loading goods on board
ship. Preparing
shipping documents
INCOTERMS 2000
CFR Cost and Freight. 875 7685
Sea Freight to
Hamburg (nearest
port to Hanover)
CIF Cost, insurance, 100 7785
freight. Sea freight +
marine insurance
(port to port)
DES Delivered ex ship at 90 7875
Hamburg.
Landing charges at
Hamburg port.
INCOTERMS 2000
DDP Delivery duty Paid at 1200 9075
customer’s warehouse
in Hanover. Import
duties for 3000 pairs
of shoes
Transport by rail 150 9225
Hamburg to Hanover
The buyer actually 1350 9225

pays **
(**) = ‘availability price’.

Processing of an Export
Order
Processing of an export order
Preliminary Pre-shipment Shipment Post-shipment

Stage Stage Stage Stage
Preliminary Stage
Setting up of new Organisation or

adding an export section to existing
one.
Registering with various Authorities

1. Income Tax
2. Jt. DGFT
3. EPC
4. Excise
5. Customs
6. VAT/Service Tax
Pre-shipment Stage
Examination and acceptance of

export order/letter
Manufacturing or procuring export goods
Obtaining
1) authorizations
2) export licences, if required
3) L/C,
4) Pre-shipment finance,
5) ECGC Cover,
6) Marine Insurance Policy, etc.
Appointing C&F Agents

Shipment Stage
Preparation of ARE-1 and other documents
Submission and processing of Documents for

Customs Clearance to C&F agent
Examination of goods/Customs clearance
After the documents are cleared, goods are brought for physical
examination. The Dock Appraiser records examination report,
makes ‘Let Export’ endorsement on the duplicate copy of
Shipping Bill and hands over the same to the C&F Agent to be
presented to Preventive Officer supervising the loading of the
cargo.
C&F Agent forwards all the documents to the exporter.

Post-shipment
Shipment Advice is sent to Importer.
Export Documents are presented to Bank for negotiation.
Export documents are scrutinized, and if found in order are

negotiated or sent for collection. Exporter receives payment
through Banking channel and upon realisation Bank issues
Bank Realisation Certificate to Exporter.
Exporter claims rebate of central excise duty or submits proof

of export if goods are cleared under bond
Exporter initiates action for claiming export benefits.

Overview of
Documentation
Significance of Documentation
q Documents are important for the following reasons:
(a) as an evidence of shipment and title of goods;

(b) for obtaining payment;
(c) to provide a specific and complete description of the goods ;
(d) for assessment of correct Duty for clearance purpose;
(e) for obtaining Export Licences;
(f) for obtaining export finance;
(g) for completing Pre-shipment Inspection;
(h) for claiming export benefits like Duty Drawback, etc.
Commercial / Regulatory
Documents
q Commercial set of documents are mainly used for
Commerce. In other words these are documents
normally exchanged between buyer and seller.
q Regulatory documents are required in dealing with

various regulatory authorities such as customs, RBI,
Excise, Licencing authorities Inspection and other
Export Promotion bodies for availing incentives etc.
Commercial / Regulatory
Documents
q Documents are categorized into two categories, namely
Commercial Documents and Regulatory Documents.
Commercial Regulatory
Commercial Invoice Shipping Bill
Inspection Certificate ARE1 from (Excise)
Insurance Certificate RBI Declaration Forms (GR/PP)
Bill of Lading / AWB Application for remittance of
currency
Certificate of Origin Various Licences
Bill of Exchange Bill of Entry
Shipment Advice
Packing List
Commercial / Regulatory Documents
Commercial Documents
q Referring Principal
to the Commercial set of Auxiliary
documents, it may
please be observed
1. Commercial Invoice that these set Invoice
1. Proforma of documents are
prepared fromCertificate
2. Inspection other set of2.documents
Intimation for(some of these
Inspection
only). These are known as auxiliary documents.
3. Insurance Certificate 3. Declaration for Insurance
4. Certificate of Origin 4. Application for Certificate of
q These documents may notOrigin
be required by the foreign
buyer, but these are must for preparation of main
export documents,
5. Bill of Lading known5. Mate
as Principle
Receipt Commercial
Documents.
6. Shipment Advice 6. Shipping order
7. Packing List 7. Shipping Instructions
8. Bill of Exchange 8. Letter to Bank for negotiation
of documents
Export Documentation
qPre-shipment Documents
qPost-shipment Documents
Pre-shipment Documents
q Documents at pre-shipment stage are those documents,
which are required to be made, till the consignment is
presented to the customs department for clearance.
q The following documents can, therefore, be treated as

pre-shipment documents:-
§ Proforma Invoice
§ Confirmed order or contract
§ Letter of Credit
§ Pre-shipment Inspection Certificate
§ Packing list
§ Shipping Bill
§ Export Declaration Forms (GR/SDF)
§ ARE
Post-shipment Documents
q Documents at Post-shipment stage are naturally those
which are prepared after the shipment.
q These documents include the following:-

§ Mate Receipt
§ Bill of Lading
§ Airway Bill
§ Roadway/Railway Bill
§ Post Parcel/ Courier Receipt
§ Invoices (including consular invoice)
§ Certificate of Origin
§ Insurance Certificate or Policy
§ Bill of Exchange
§ BRC
Documents for availing various Export
Benefits
q Documents are also divided, depending upon, whether
the benefit has to be claimed prior to exports or after
the exports.
q For claiming benefits one has to make different

applications with various government authorities.
Contd….
Benefits
q At the pre-shipment stage the following documents
are note-worthy.
§ Application for pre-shipment finance from the bank.
§ Application of Advance Authorization or Duty Free Import
Authorisation with DGFT.
§ Application for execution of Bond with Central Excise
authorities.
§ Application for obtaining CT-1 in case of a Merchant Exporter
Benefits
q At the post shipment stage, the following documents
are note-worthy.
§ Application of Duty Entitlement Pass Book.
§ Application for Focus Market or Focus Product Scheme.
§ Application for fixation of Brand rate of Drawback
Import Documentation
Important Documents–Imports
q Invoice
q Packing list
q Bill of Lading or Delivery Order/Airway Bill
q GATT declaration form duly filled in
q Importers/CHA’s declaration
q Licence/Authorisations in original wherever necessary
q Letter of Credit/Bank Draft/wherever necessary
q Insurance document
q Import license
q Industrial License, if required
q Test report in case of chemicals
q Catalogue, Technical write up, Literature in case of machineries,
spares or chemicals as may be applicable
q Separately split up value of spares, components, machineries
q Certificate of Origin, if preferential rate of duty is claimed under
PTAs/FTAs etc.
q No Commission declaration
Understanding Documents
q All documents whether it is for export or import transaction
generally contain following information
§ Name and address of the exporter and importer
§ Document No. and date.
§ Order No. and date
§ Port of discharge
§ Port of destination
§ Country of origin
§ Description of Goods
§ Marks and nos., model nos. [if any]
§ Weight
§ ITC HS Code No.
§ Value
§ Currency
§ Terms of payment
§ Terms of shipment etc.
q However, depending upon the nature of the document,
specific information is to be mentioned.
q For e.g. apart from the above details, Shipping Bill will
include what export benefit is being claimed against
that particular shipment, etc. Similarly, Packing List
will give information about how goods are packed.
q Let us now study each document in depth.

Invoice
q It is itemized statement prepared and issued by a seller
at the time of dispatching the goods to the buyer.
q It helps the Customs Authorities to:

§ ensure that goods shipped are permitted by the export policy.
§ compute the customs duty, if any, payable on the export or the
import.
§ check the quantity of goods. They generally open a few
packages at random and check the veracity of details in the
invoice.
§ check if there is any over-invoicing or under-invoicing (that
may be resorted to by the importer to reduce the import duty
payable).
Invoice
q Invoices are often called bills.
q Various types of invoices used in International Trade

are
• Proforma Invoice
• Commercial Invoice
• Consular Invoice or Leagalized Invoice
• Customs Invoice
PROFORMA INVOICE
q When negotiation is finalised and buyer intends to place an order

he normally requests the exporter to send proforma invoice
incorporating all details of proposed transaction.
q It is useful to buyer/importer in different ways:-

§ It helps to eliminate common error of wrong description, spelling and
technical specifications.
§ Letter of Credit can be established as per proforma invoice. Many
times in L/C, reference of proforma invoice is also given. In that case
it becomes an important document while negotiation.
§ Sometimes an importer needs proforma invoice to enable him to
obtain an import license from his government, & for foreign exchange
authorities etc.
§ In some countries, proforma invoice is required for customs clearance.
COMMERCIAL INVOICE
q Commercial Invoice is a fundamental commercial
document of prime importance in any trade
transaction.
q It is a bill for the goods/ of merchandise from the seller

to the buyer.
q It is a prima facie evidence of the contract of sale and

purchase.
q There is a Special provision under Uniform Customs &

Practice for Documentary Credits UCP – 600 for
Commercial Invoice.
COMMERCIAL INVOICE
q There is no standard format for a commercial invoice, it
generally contains the following details:
§ Name & Address of the Shipper/Exporter and Importer/Consignee
§ Commercial Invoice number & date
§ Reference, order of acceptance or contract number & date
§ Description of goods consigned in full (No short cut), Quantity
§ Shipment details – vessel name/voyage – port of loading / discharge
§ Net Weight / Gross weight
§ Terms and conditions of the Sale (Incoterms 2000)
§ Terms of payment
§ Shipping marks and number of packages, special markings, if any
§ Country of origin
§ Import-Export licence number
§ Signature by authorised person
CONSULAR INVOICE or LEGALISED INVOICE
q Post shipment document.
q Consular invoice is a certificate issued by Trade

Consular of importer’s country stationed in the
exporter’s country.
q This invoice is required mainly by the African Countries

like Kenya, Uganda, Tanzania, Mauritius, Nigeria,
Ghana, Zanzibar, etc.
q This invoice is most important document which needs

to be submitted for certification to the embassy of the
importing country located in the country of exports.
CONSULAR INVOICE or LEGALISED INVOICE
q Consular invoice is an invoice which is sworn to as being

correct in all particulars before the Consul of the
country to which the goods are destined.
q It facilitates the clearing of goods through customs of

the importing country.
q Consular invoices provide the importing country with a

means of:
§ Checking prices of goods
§ Determining the origin of goods
§ Calculating import duties
§ Checking over- and under invoicing
CUSTOMS INVOICE
q The customs invoice is used in lieu of the commercial

invoice in few importing countries for customs
purposes, but the importer often needs a commercial
invoice too.
q The customs invoice can be in a form called the

certificate of value.
q The invoices vary in format but they contain essentially

the same data as in the commercial invoice and packing
list.
Packing List
q It is a consolidated statement in a prescribed format detailing how
goods are packed, marked and numbered including weight and
dimensions of each package.
q It is useful for customs at the time of examination and warehouse

keeper of buyer to maintain inventory record and to effect
delivery.
q It have many details common from invoice but it does not indicate
unit rate value of goods.
q The exporter or his/her agent, the customs broker or the freight

forwarder, reserves the shipping space based on the gross weight
or the measurement shown in the packing list.
Packing List
q Customs uses it as a check-list to verify:
§ the outgoing cargo (in exporting) and
§ the incoming cargo (in importing).
q Basic functions of Packing List are:

§ To confirm the contents of a shipment as it left the exporter’s
premises.
§ To indicate weights, measures and the piece count (i.e. the
number of cartons or cases) in that shipment.
q It is prepared in 7-10 copies or as per the requirement.

Inspection Certificate
q “Certificate of Inspection” is issued by the Inspection Agency
concerned certifying that the consignment has been inspected
before shipment as per the requirements of the Exports (Quality
Control and Inspection) Act, 1963.
q It satisfies the conditions relating to quality control and inspection

as applicable to it and is certified export worthy.
q This certificate is required:

§ by customs before allowing shipment of goods or
§ by a banker to negotiate the documents.
q This certificate bears cross references of invoice or contract

number.
Inspection Certificate
q Inspection can be done by
§ Inspection Agency appointed by the Government of India, i.e.
Export Inspection Agency, Textile Committee, Central Silk
Board etc.
§ Inspection Agency may also be nominated by importing
countries’ Government i.e. SGS and OMIC by some African
Countries.
§ Sometimes buyer himself appoints an independent private
inspector to inspect the goods.
q If an inspection is a part of transaction, then exporter is required

to arrange for necessary inspection.
q It can be a certificate of quality, weight, analysis, or the like.

Certificate of Origin [COO]
q It is a certificate indicating the fact that the goods which have
been exported have originated or manufactured in a particular
country. So it is a sort of declaration testifying the origin of
export.
q It is normally required by an importer to clear goods from the

customs.
q For political and social reasons, it is insisted by Customs Authority

of importing country before goods are allowed to enter in the
country.
q It helps the importer to take an advantage in duty concession, if

any. For e.g. goods imported under Free Trade Agreement.
Certificate of Origin [COO]
q On the basis of COO, Customs can ensure that certain
prohibited goods of particular countries are not imported.
q It also ensures that goods have not been reshipped by a

seller who has brought them into his own country from some
other place of origin.
q It is sent to the importer by the exporter.
q It is issued or signed by an independent official organization,

such as a Chamber of Commerce, on prescribed form.
Certificate of Origin
q These are often required:
§ to meet Customs requirements in the importing state
§ to comply with Banking requirements
§ for other official and commercial reasons.
q There are two categories of Certificate of Origin :

1. Preferential Certificate of Origin and
2. Non-preferential Certificate of Origin
Preferential Certificate of Origin
q It entitles preferential treatment in duty in the
importing country.
q These certificates are governed by rules of origin which

are always part of Preferential Trading Agreements
entered into between two or more countries.
q As far as India is concerned the following agreements

are noteworthy:
• Generalised System of Preferences (GSP)
• SAARC Preferential Trading Agreement (SAPTA)
• Asia- Pacific Trade Agreement (APTA)
• India-Sri Lanka Free Trade Agreement (ISLFTA)
Preferential Certificate of Origin
q Some of the agencies which are authorised to issue

PCOO are:
• Export Inspection Agencies – All products.
• Directorate General of Foreign Trade & its regional offices -
All products.
• Spices Board, Ministry of Commerce & Industry - Spices and
Cashewnuts
• Central Silk Board through 8 regional offices all over India -
Silk Products.
• Coir Board – Coir and Coir Products.
• Textile Committee - Textiles and madeups
Non-preferential Certificate of Origin
q It evidences the origin of goods and do not bestow any

right to preferential tariffs.
q The Government has also nominated certain authorised

agencies to issue Non Preferential Certificate of Origin
in accordance with Article II of International
Convention Relating to Simplification of Customs
formalities.
Shipping bill
q Shipping Bill is an important document required to seek permission
of customs to export goods by Sea/Air. It is prepared by the
exporter and submitted to the Customs.
q The exporter of any goods has to file a “SHIPPING BILL” as an entry

for the purpose of export by air or sea and a “BILL OF EXPORT” in
respect of export by land.
q Cargo will be allowed to be carted to Dock/Port sheds only after

stamping and passing of the shipping bill by customs authorities.
q The exporter has to sign a declaration in the Shipping Bill regarding

the truth of its contents.
Shipping bill
q Shipping Bill normally contains:
• the name and address of the importer/consignee and
exporter,
• invoice number and date,
• name of vessel carrying the goods,
• name of master or agents,
• port at which goods are to be discharged,
• country of final destination,
• description of goods, quantity details of each case,
• value of the goods as defined in the Sea Customs Act,
• number of packages with total weight,
• marks and numbers, etc.
Shipping bill
q Types of Shipping Bills:
§ FREE SHIPPING BILL: Used for export of goods which neither
attract any Export duty/cess nor entitled to any Duty Drawback
§ DUTIABLE SHIPPING BILL: Used when export goods are subject

to Export Duty/Cess. Duty is charged either on quantity basis
(Fixed amount per kg. or per Metric tonne) or on certain
percentage of assessable value.
§ DRAWBACK SHIPPING BILL: Used when Duty Drawback is to be

claimed.
§ SHIPPING BILL FOR SHIPMENT EX-BOND: Used when the goods

are to be exported which have been imported earlier and kept
in bond prior to re-export.
Shipping bill
q Types of Shipping Bills:
§ DEPB SHIPPING BILL: When DEPB benefit is to be claimed.
§ DEEC SHIPPING BILL: This shipping bill is used for export of

goods under Advance Authorisation (Duty exemption scheme).
§ DEEC CUM DRAWBACK SHIPPING BILL: This shipping bill is used

for export of goods where both the schemes Duty Exemption as
well as Drawback are to be taken into account.
Shipping bill
q Shipping bill is required to be submitted in quadruplicate. If
Drawback/DEPB claim is to be made, one additional copy should
be submitted.
q Copies of Shipping Bill are as under:

§ Customs Copy: For record of Customs
§ Exporter’s Copy: For record of Exporters/ Exporter may forward it
to shipping company.
§ Export Promotion Copy: For office of DGFT. This copy is the most
important document for claiming duty Neutralisation/Exemption
benefits plus export incentives wherever applicable.
§ Exchange Control Copy: For negotiating the export documents in
bank. It is Proof of export for exchange purposes.
§ DEPB Copy: For use in the import cell of customs for registration of
licence.
ARE
q ARE stands for application for removal of excisable
goods for exports by Air/Sea/ Post/Land.
q Goods which are sold overseas are exempted from

payment of excise duty or entitled for Rebate of Excise
Duty, if excise paid goods are exported. Under both
these circumstances, the document to be used is ARE.
q When goods are removed without payment of duty for

the purpose of export, they will get covered under the
provisions of Rule 19 of the Central Excise Rules.
ARE
q When excise paid goods are exported and rebate of
Excise Duty is to be claimed, they will get covered
under Rule 18 of Central Excise Rules.
q ARE is prepared before clearance of goods from the

factory gate.
q ARE will specify whether goods are exported under Rule

19 or under Rule 18.
ARE
q There are three types of ARE:
a) ARE 1: is used for physical export of goods.
b) ARE 2: is used when goods are removed for

manufacture and packing of the goods to be exported.
c) ARE 3: is used when goods are supplied as deemed

exports.
Mate Receipt
q Mate’s receipt is a receipt issued by the Master or Mate of the
vessel stating that certain goods have been received on board his
vessel.
q It is prima-facie evidence that the goods are loaded in the vessel.
q It contains:
the name of shipping line and vessel,
port of loading, port of discharge and place of delivery,
marks and numbers,
number and kind of packages, gross weight,
description of goods,
container status/seal number,
shipping bill number and date and
condition of cargo at the time of its receipt on board the vessel.
q It is serially numbered.
Mate Receipt
q Port authorities recover port dues from exporter on production of

this receipt.
q On payment of Dock dues, the exporter or his agent collects the

receipt from the Port-Trust authorities and hands over to shipping
company for preparing Bill of Lading.
q Bill of Lading is prepared on the basis of Mate’s Receipt.
q It is of a transferable nature.
q In case of ascertaining the exact date of shipment, the mate’s

receipt date is also very important.
q Normally, the date of Export is regarded as “the date of Mate

Receipt or the date of Bill of Lading, whichever is later”.
Export Declaration Forms (GR/SDF)
q As per the exchange regulations, exporters, wishing to ship goods

abroad, are required to submit Export Declaration Forms to the
Customs authorities (whenever the value of the shipment exceeds
US $ 25,000) before any export of goods from India is made.
q It is to be filed by exporter stating that export proceeds would be

realized within 180 days for non-status holder exporters and 360
days for status holder exporters.
Relevant Declaration Forms, as prescribed by RBI under

Foreign Exchange Management (Export of Goods and
Services) Regulations, 2000.
GR : Used for exports to all countries made other than by

Form post including export of software in physical form i.e.
magnetic tapes/discs and paper media - When S/B is
filed manually. [prepared in duplicate]
SDF : Appended to the shipping bill, for exports declared to

Form Customs Offices notified by the Central Government
which have introduced Electronic Data Interchange (EDI)
system for processing shipping bills notified by the
Central Government. [prepared in duplicate]
q These forms normally contain:
§ Name and address of exporter, IEC code number and description of
goods.
§ Name and address of authorised dealer through whom the proceeds of
the exports have been, or will be, realised.
§ Details of commission due to foreign agent or buyer should be
correctly declared. Otherwise, difficulties may arise at the time of
remittances of such commission/ payment. An exporter should note
this point very carefully.
§ It should be clearly indicated whether the export is on “Outright Sale
Basis” or “On Consignment Basis”
§ An exporter is required to give analysis of full export value, a break-
up of FOB value, freight, insurance, discount, commission, etc.
§ An exporter has to mention the period within which he will realise full
export value of transaction. If the shipment is on DA terms, then an
exporter has to bring forex within that period. However, normally
maximum period allowed is 180 days.
Statutory Declaration Form [SDF]
q Procedure for Distribution / disposal of copies of SDF
§ The SDF form should be submitted in duplicate (to

be annexed to the relative shipping bill) to the
Commissioner of Customs concerned.
§ After verifying and authenticating the declaration in

form SDF, the Commissioner of Customs will hand
over to the exporter, one copy of the shipping bill
marked ‘Exchange Control Copy’ in which form SDF
has been appended for being submitted to the bank
within 21 days from the date of export.
Statutory Declaration Form [SDF]
§ Banks should accept the Exchange Control (EC) copy
of the shipping bill and form SDF appended thereto,
submitted by the exporter for collection/negotiation
of shipping documents.
§ The manner of disposal of EC copy of shipping Bill

(and form SDF appended thereto) is the same as that
for GR forms.
MARINE INSURANCE POLICY
q Marine insurance policy is a contract whereby the
insurer (insurance company) in consideration of a
payment or premium by the insured agrees to indemnify
the latter against loss incurred by him in respect of
goods exposed to perils of the sea.
q It should normally:
a. cover to the extent of 110% of CIF value
b. express in the same currency of Letter of Credit and
c. cover risk from the date of shipment.
MARINE INSURANCE POLICY
q The policy should specify different kinds of risks covered
for example:
• ‘All Risk’,
• ‘Warehouse to Warehouse’ and
• ‘Clause A’
q The claim of insurance can be made payable at

destination, if so desired.
q The amount paid to insurance company as consideration

is known as ‘Premium’. It is a factor of cost and
calculated roughly at 1%.
Bill of Exchange
q Bill of Exchange [BE] is a document drawn and is an
order by the exporter to the buyer to pay the money in
specified exchange.
q It is also known as a draft.
q A bill of exchange is accompanied by commercial

documents which are presented by a bank and released
to the buyer either against payment (at sight) or
against a signature for payment on a specified future
date.
q It is an unconditional written order.

Bill of Exchange
q When a BE is drawn on foreign firm it is termed as a
foreign draft or bill of exchange.
q It is prepared either in an international currency or

Indian rupees depending on the terms of the contract.
q Accordingly, the bill is known by the name of currency

in which it is drawn.
e.g. a bill drawn in US dollars is known as a “Dollar
Bill” and when drawn in Rupees, it is termed as
“Rupees Bill”.
Bill of Exchange
q The most common versions of a bill of exchange are:
A) Sight Draft –
§ When the drawer (exporter) expects the drawee
(importer) to make payment immediately upon the
draft being presented to him.
§ Unless and until the Draft is received, the

Negotiating/ Collecting Bank does not hand over the
Shipping documents and the buyer cannot take
delivery of goods.
Bill of Exchange
B) Usance Draft –
§ When draft is drawn for payment at a date later
than the date of presentation.
§ It may be a fixed future (specific) date or
determinable date according to the period of credit
viz. 30 days, 60 days or 90 days etc.
§ It is presented to the drawee (importer) who will
retire the documents by accepting the draft by
putting his signature and date.
Bill of Exchange
q When the payment is received in advance no Bill of
Exchange is required to be drawn.
q Parties to a bill of exchange

i. Drawer – who makes the order for making
payment.
ii. Drawee – whom the order to pay is made.
iii. Payee – whom the payment is to be made.
Bill of Exchange
q Features of a Bill of Exchange:
§ A bill must be in writing, duly signed by its drawer,
accepted by its drawee and properly stamped.
§ It must contain an order to pay. Words like ‘please
pay US $ 5,000 on demand and oblige’ are not used.
§ The order must be unconditional.
§ The sum payable mentioned must be certain or
capable of being made certain.
§ The parties to a bill must be certain.
Bank Realisation Certificate
q Once the export proceeds are realised, the exporter
has to prepare Bank Certificate of Export and
Realisation for the purpose of claiming export benefits,
incentives, etc.
q It is prepared as per Form No.1, given in Appendix 22A

of Handbook of procedures 2004-09 (Vol. I).
q To prepare this certificate, the date of realisation is

most essential, as the exporters have to apply for the
export benefits, incentives, etc. within six months
following the month/quarter of the realization month.
q It is signed by the authorized signatory of the
firm/company with full name in block letters with
designation, full official and residential addresses.
q Bankers attest this certificate as true and correct after

verifying the particulars, including the date of mate
receipt. This date is the most important, as this is the
actual date of export.
q It is signed by an authorized signatory of the bank with
his name and designation.
q Bankers affix certificate number and date and also

mention the Authorized Foreign Exchange Dealer's Code
number allotted to Bank by Reserve bank of India.
q For this purpose, this certificate must be accompanied

with the following documents:-
§ A copy of invoice,
§ A copy of customs attested export promotion copy of the
shipping bill,
§ A copy of Bill of Lading/ PP receipt/ Airway bill,
§ A copy of the insurance certificate/Insurance policy/cover.
Bill of Lading (B/L)
q Bill of Lading is the transport document associated with
Sea freight.
q It is issued by the Shipping Company or its agent or

master of a ship acknowledging that specified goods
have been received on board as cargo for conveyance
to a named place for delivery to the consignee who is
usually identified.
q It is a document of title to the goods and, as such, is

freely transferable by endorsement and delivery.
q Bill of Lading serves three purposes as:
§ Receipt given by Shipping Company as goods described on
document has been received by it/carrier.
§ Evidence of the contract of carriage by sea between the
shipping company and the shipper (exporter or importer).
§ Document of title to the goods and can be used to obtain
payment or a written promise before the merchandise is
released to the importer.
q For the bill of lading to be negotiable it must be:

1. made out to the order to the shipper.
2. signed by the steamship company.
3. endorsed in blank by the shipper.
q It is the only evidence to file a claim against the
shipping company in the event of non-delivery,
defective delivery or short-delivery of the cargo at the
destination.
q For preparation of B/L the exporter should submit the

complete set of B/L together with mate receipt to the
shipping company which will calculate the freight
amount on the basis of measurement or weight.
q On payment of freight, the shipping company returns

the B/L duly signed and supported by requisite
adhesive stamps.
q Generally made out in the sets of two or three originals
duly signed by the master of the ship or the agent of
the steamship company.
q All the originals are equally valid for taking the delivery
of the goods. Once one original is utilised the other
originals become null and void.
q Marked as ‘Non-negotiable copy’ cannot be utilised for

taking the delivery of goods.
q Bill of Lading contains the following information:
§ Shipping company’s name and address.
§ Consignee’s name and address.
§ Notify party
§ Name of the vessel,
§ Port of loading/Shipment and port of discharge.
§ Shipping marks and Numbers, Cubic measurements, weights
§ Description of the goods
§ Number of packages.
§ Shipped on board with date-rubber stamp.
§ Gross weight and net weight.
§ Freight details
§ Signature of the shipping company’s agent.
§ Container number if any.
§ Shipper’s name and address.
§ B/L Number and Date
§ Originals
§ Terms (on reverse)
q Bill of Lading can be further described as under:-
§ Shipped on Board :- When goods are actually shipped on
board.
§ Received for shipment :- When goods have been handed over

to agent for shipment.
§ Through B/L:- When two or more carriers/ different modes of

transport form i.e. road, rail, air, and sea employed to reach
goods to their final destination.
§ Transhipment B/L:- When there is no direct service between
the two ports and ship-owner is prepared to tranship the goods
at an intermediate port.
§ Stale B/L:- i.e. a late B/L that has been held too long before it
is passed on to a bank for negotiation or to the consignee.
§ Clean B/L:- Where the carrier has noted that the goods have
been received or loaded in ‘apparent good condition’ (no
apparent damage, loss, etc.).
§ Claused B/L:- Which contains additional clauses/notations
limiting the responsibility of the shipping company which
specify deficient condition(s) of the goods and/or packaging.
§ Combined Transport B/L:- When different modes of transport

are used; usually issued when goods stuffed at shipper’s
premises and delivered at consignee’s premises.
§ Charter Party B/L:- Where a shipper has contracted with a
shipping line to charter a vessel for the movement of cargo. It
is issued by the carrier or its agent in the charter shipping.
Unless otherwise authorized in the letter of credit (L/C), the
charter party B/L is not acceptable in the L/C negotiation.
§ Freight Paid B/L:- When freight is paid at the time of

shipment or in advance, the B/L is marked, freight paid.
§ Freight Collect B/L:- When the freight is not paid and is to be

collected from the consignee on the arrival of the goods, the
B/L is marked, freight collect.
§ Negotiable B/L:- It is a title document to the goods, issued “to
the order of” a party, usually the shipper, whose endorsement
is required to effect it’s negotiation. Thus, a shipper's order
(negotiable) B/L can be bought, sold, or traded while goods
are in transit and is commonly used for letter of credit
transactions.
Airway Bill (AWB)
q Airway Bill is a transport document associated with Airfreight.
q It serves as a receipt for goods and an evidence of the contract of

carriage, but it is not a document of title to the goods. Hence,
the AWB is non-negotiable.
q It contains the following details:

§ number of packages
§ dimensions or volume
§ gross weight
§ shipping marks
q The goods in the air consignment are consigned directly to the

consignee.
Airway Bill (AWB)
q On the reverse side of the airway bill are the airline’s terms and
conditions of carriage whereby an airline is obligated to transport
a consignment to its final destination once it has confirmed
receipt of the shipper’s consignment.
q Airway bill can be comprised in two parts:

§ MAWB (Master Airway bill) – shipments sent on a direct basis,
not consolidated.
§ HAWB (House Airway bill) – shipments sent on a consolidation

basis whereby grouping together various clients consignments
under one MAWB being issued by the freight forwarder.
ECGC COVER
q Export Credit Guarantee Corporation of India (ECGC) is
an institution, which plays vital role in the promotion
of exports.
q How does ECGC help Exporters?

§ offers insurance protection to exporters against payment risk,
§ provides guidance in export related activities,
§ makes available information on different countries with its own
credit ratings,
§ makes it easy to obtain export finance from banks/ financial
institutions,
§ assists exporters in recovering bad debits,
§ information on credit - worthiness of overseas buyers.
ECGC COVER
q Main activities of the ECGC:
§ ECGC provides a wide range of credit risk insurance covers to
exporters against loss in export of goods and services and issues
policies.
§ The ECGC covers can be divided broadly into four groups:

1. Standard Policies issued to:
a) exporters to protect them against payment risks involved
in exports on short-term credit; and
b) small exporters’ policy to protect them against payment

risks involved in exports on short-term credit.
ECGC COVER
2. Specific policies designed to protect Indian firms
against payment risks involved in:
a) exports on deferred terms of payment;
b) services rendered to foreign parties; &
c) construction works and turnkey projects undertaken
abroad.
3. Financial guarantees: ECGC offers guarantees to

banks and financial institutions in India to protect them
from risks of loss involved in extending their financial
support to exporters at the pre-shipment as well as
post-shipment stages;
ECGC COVER
4. Special schemes:
ECGC also provides guarantee to bank under special
schemes viz.
§ Transfer Guarantee [meant to protect banks which add
confirmation to Letters of Credit opened by foreign banks],
§ Insurance cover [for Buyer’s Credit],
§ Line of Credit,
§ Overseas Investment Insurance to Indian companies investing in
joint ventures abroad in the form of equity or loan
§ Exchange Fluctuation Risk Insurance.
ECGC COVER
q ECGC covers the following risks:
§ Commercial Risks
§ Political Risks
q Commercial Risk covers

§ Insolvency of the buyer.
§ Failure of the buyer to make the payment due within a
specified period, normally four months from the due date.
§ Buyer's failure to accept the goods, subject to certain
conditions.
ECGC COVER
q Political Risks
§ Imposition of restriction by the Government of the buyer's
country or any Government action, which may block or delay in
transfer of payment made by the buyer.
§ War, civil war, revolution or civil disturbances in the buyer's
country.
§ New import restrictions or cancellation of a valid import
license in the buyer's country.
§ Interruption or diversion of voyage outside India resulting in
payment of additional freight or insurance charges which can
not be recovered from the buyer.
§ Any other cause of loss occurring outside India not normally
insured by general insurers, and beyond the control of both the
exporter and the buyer.
ECGC COVER
q Risks not covered by ECGC
§ Commercial disputes including quality disputes raised by the
buyer, unless the exporter obtains a decree from a competent
court of law in the buyer's country in his favor.
§ Causes inherent in the nature of goods.
§ Buyers’ failure to obtain necessary import or exchange
authorization from authorities in his country.
§ Default or insolvency of any agent of exporter or collecting
bank.
§ Loss or damage to goods which can be covered by general
insurance.
§ Exchange rate fluctuation.
§ Failure or negligence on the part of the exporter to fulfill the
terms of the export contract.
Tips for Proper Documentation
q Implications of all Regulatory documents must be studied

carefully. For example; declaration on ARE1 forms.
q Filing of Shipping Bill electronically requires correct entries

including HS code for the product. Many times, small mistakes
are extremely difficult to correct later on.
q Shipping bills must be filed according to the scheme the

exporter wants to avail . For example; DEPB /DFIA/Drawback
etc.
q Extra care should be taken when combination of schemes is

intended to be used. For example; DEEC – Drawback.
q Co-relation between customs, excise and DGFT is extremely

important. Many times documents do not match with each
other, which results in delay or denying of some benefit under
one or the other scheme.
Tips for Proper Documentation
q Each regulatory document is important from the point of view

of claiming various benefits associated with exports. Each
document therefore should be carefully looked into as to
correctness of the contents, description, quantity, weight,
currency, declaration etc.
q Maintenance of statutory records: Since most of the schemes

are in the nature of the exemption / remission of the duty,
documentary compliances are insisted upon by all the
government departments. For example; Appendix 23 –
Consumption register.
PRE-SHIPMENT INSPECTION
FORMALITIES
q Quality is an important element of export marketing.
q Exporters must export goods of international standards.
q In India, the Quality Control and Inspection Act provides for
compulsory quality control and pre-shipment inspection.
q The Export Inspection Council [EIC] was set up by the Government
of India under Section 3 of the Export (Quality Control and
Inspection) Act, 1963 (22 of 1963), in order to ensure sound
development of export trade of India through Quality Control and
Inspection and for matters connected thereof.
q EIC and its agencies are involved in maintaining the quality and
providing inspection certificate to the exporters.
q The inspection certificate is required by the customs authority for
the shipment of the goods.
PRE-SHIPMENT INSPECTION
FORMALITIES
q ISI and AGMARK are recognized as a mark of adequate quality for
export purpose.
q The customs authorities allow the export of products marked ISI

and AGMARK without any pre-shipment inspection certificate, as
such product’s quality is guaranteed.
q TYPES OF PRE-SHIPMENT INSPECTION, SYSTEMS OF QUALITY

CONTROL/ INSPECTION :
a. Consignment-wise inspection (CWI)
b. In-process Quality Control (IPQC)
c. Self-certification scheme
d. Food Safety Management System based Certification
e. Fumigation of consignment
Procedure for pre-shipment
inspection
Inspection
A B
Units with adequate Units not approved with
In-process quality In-process quality control
control
Units with adequate In-process quality
control
q Certificate of inspection given on the basis of the

unit’s performance report submitted by the inspectors
during the checks at all levels of production.
q They have to submit their applications in the

prescribed ‘Intimation for Inspection’ form to the
Export Inspection Agency.
Units not approved with In-process
quality control
Application for inspection Agency
1. In the prescribed format
2. 7 days prior to the date of shipment
3. Documents required
• Copy of the export contract
• Copy of letter of credit
• Details of packing specification
• Invoice giving evidence of FOB value of export
consignment
• Crossed cheque for the amount of inspection
fees, and
• Declaration regarding importer’s technical
specification, if any.
Units not approved with In-process
quality control
Inspector
Agency factory inspects goods
seals goods certificate of inspection given

to the exporter in triplicate
1. Original copy to the export
department of customs
2. Duplicate copy to the importer
3. Triplicate copy to the exporter
Sudhakar Kasture
Exim Institute
Thank You Mumbai:

A-203, Everest Chambers,
Next to Star TV Office,
Near Marol Naka,
Andheri-Kurla Road,
Andheri (East), Mumbai – 400 059.
Tel: 28507615/28507329/65769126
Fax: 28506419
Pune:
EPI Centre, Opp. Indsearch,
Law College Road, Pune 411004.
Tel:(+91) 020 65246159
Fax: (+91) 020 25465195
E-mail: exim@helplineimpex.co.in

Export Documentation

Hochgeladen von

Dokumentinformationen

Originalbeschreibung:

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

Export Documentation

Hochgeladen von

Copyright:

Verfügbare Formate

EXIM DOCUMENTATION &

q Setting up of an appropriate form of business

q Choosing appropriate mode of operation – How one

q How to select name, design stationary including

q When and where to open a Bank Account?

q How to obtain mandatory registration?

q How to quickly respond to overseas enquiries and how

q Electronic Data Interchange (EDI)

§ Main types of business organisations prevailing in India are:

q How one wants to enter into the business?

q Designing of Stationery [Letterheads, envelopes,

q Creating Website (Online Home Page)

q How to obtain mandatory registrations?

b. Importer-Exporter Code Number (IEC):

§ As per Policy Circular No. 15/2006 Dtd. 27.07.2006 an applicant

§ DGFT has authorised various agencies to issue a Digital

§ With a Digital Signature one can apply for licenses

§ Digital Signatures are legally admissible in a Court of Law, as

§ W.e.f. 01.04.2004, no on-line application is possible if an IEC

§ An exporter desiring to obtain a Registration-cum-Membership

§ However, a status holder has the option to obtain RCMC from

q Agricultural and Processed Food Products Export Development

q The Gem & Jewellery Export Promotion Council

v. Registration with VAT Authorities

vii. Electronic Data Interchange (EDI)

• It increases the profits by lowering the cost of the

• The Indian Government has also fallen in line with the

§ Legally binding document.

§ It reduces the probabilities of disputes & differences

§ There should not be any ambiguity regarding the exact

§ Standard Export Sales Contract forms are also available. These

In their sales contract buyer and seller agree on the

q The Incoterms divide costs and risks

The seller must: The buyer must:

In order to finalise the transaction, both parties will

Arrange for licences, Arrange for licences,

Source: Guide to Incoterms, ICC Paris

q FCA = FREE CARRIER (… named place)

q CIP = CARRIAGE AND INSURANCE PAID TO (…named place of

q DES = DELIVERD EX SHIP

q DDP = DELIVERED DUTY PAID (…named place of

(*) In this calculation example, all costs are hypothetical.

If you Your price should Additional Your total price

FAS Free alongside ship at 310 6710

The buyer actually 1350 9225

(**) = ‘availability price’.

Preliminary Pre-shipment Shipment Post-shipment

Setting up of new Organisation or

Registering with various Authorities

Examination and acceptance of

Manufacturing or procuring export goods

Appointing C&F Agents

Preparation of ARE-1 and other documents

Submission and processing of Documents for

Examination of goods/Customs clearance

C&F Agent forwards all the documents to the exporter.

Shipment Advice is sent to Importer.

Export Documents are presented to Bank for negotiation.

Export documents are scrutinized, and if found in order are

Exporter claims rebate of central excise duty or submits proof

Exporter initiates action for claiming export benefits.

(a) as an evidence of shipment and title of goods;

q Regulatory documents are required in dealing with