eport procedure & documentation

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EXPORT PROCEDURES & DOCUMENTATION

Presented By:PRASHANT KUMARM.FTECH 2010-12

NIFT GANDHINAGAR

Presented To:Mr Yuvraj Garg

Dept. Of Fashion DesignNIFT GANDHINAGAR

Assignment On International Business



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Content

EXPORT PROCEDURES REGISTRATION STAGE C O M M E R C I A L

D O C U M E N T S

P R E - S H I P M E N T S TA G E S H I P M E N T S TA G E REGULATORY

D O C U M E N T S

P O S T - S H I P M E N T S TA G E Q U A L I T Y C O N T R O L A N D

P R E - S H I P M E N T

I N S P E C T I O N

P E R F O R M A I N V O I C E

S A L E S T A X E X E M P T I O N P R O C E D U R E F O R

C E N T R A L E X C I S EC L E A R A N C E

C O M M E R C I A L I N V O I C E

C U S T O M F O R M A L I T I E S P R O C E D U R E F O R

R E L I S AT I O N O F E X P O R T

P R O C E E D S

PACKING L IST

E X P O R TDOCUMENTATION

M A S T E R D O C U M E N T SA N D A L I G N E D

D O C U M E N TA I O N S Y S T E M

MATE’S R E C E I P T

B I L L O F L A D I N G S H I P P I N G B I L L C O N S U L A R I N V O I C E

B I L L O F E N T R Y AIRWAY B I LL G R F O R M




EXPORT PROCEDURES

Procedure of realization of export proceeds

Customs formalities

Procedure for excise clearance

Sales Tax exemption

Quality Control and Pre-shipment inspection

Post Shipment stage

Shipment stage

Pre-shipment stage

Registration stage




REGISTRATION STAGE

Registration of the organization

Opening Bank Account

Obtaining Importer-Exporter Code Number (IEC No)

Obtaining Permanent Account Number (PAN)

Obtaining Sales Tax Number

Registration with Export Promotion Council

Registration wit ECGC

Registration with other authorities




• Approaching Foreign Buyers

• Inquiry and offer

• Confirmation of order

• Opening letter of credit

• Arrangement of pre-shipment finance

• Production or procurement of goods

• Packing and marking

• Pre-shipment Inspection

• Central excise clearance

• Obtaining insurance cover

• Appointment of C&F agent

PRE-SHIPMENT STAGE




Reservation of shipping space

Arrangement of internal transportation up to the port of shipment

Preparation and processing of shipping document

Customs clearance

Obtaining ‘Carting Order’ from the port trust authorities

Customs examination and issue of ‘Let Export Order’

Obtaining ‘Let Ship Order’ from the Customs Preventive

Officer

Obtaining Mate’s Receipt and Bill of Lading

SHIPMENT STAGE


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Submission of Documents by the C&FAgent to the Exporter

Shipment Advice to Importer

Presentation of Documents to Bankfor Negotiation

Dispatch of Documents

Acceptance of the Bill of Exchange

Letter of Indemnity

Realization of Export Proceeds

Processing of GR form

Realization of Export Incentives

POST-SHIPMENT STAGE



QUALITY CONTROL AND PRE-SHIPMENT INSPECTION

The Government of India has set up Export Inspection Council (EIC) to

monitor the quality of goods meant for exports.

Method

• Self Certification

• In-Process Quality Control (IPQC) and

• Consignment-wise Inspection

Units exempted from the Inspection Procedure are:

• Export Houses, Trading Houses, Star Trading Houses and Super StarTrading Houses

• Approved 100% EOUs and EPZ units• Exporters who are registered with the Textile Committee

• Goods marketed with ISI, AGMARK, BIS-14000, ISO-



The processconsists of the

following steps:

Obtaining

‘H’ Form

Processing

of ‘H’ Forms

Sales Tax

Claim

SALES TAX EXEMPTION



Application to the Assistant Collector

of Central Excise (ACCE)

Information to the RangeSuperintendent

Sealing of goods

Processing of ARE-1 form

Examination of goods at the Place of Export

Submission of the Claim

Verification of the Application

Refund of Duty

Cancellation of Documents

PROCEDURE FOR CENTRAL EXCISE CLEARANCE



Preparation and Submission of Export Documents

Verification of Documents

Valuation of goods

Obtaining Carting Order from the Port TrustAuthority

Custom Examination and Issue of ‘Let Export Order’

Obtaining ‘Let Ship Order’ from the Customs

Preventive Officer

Obtaining Mate’s Receipt and Bill of Lading

CUSTOM FORMALITIES



Presentation of Documents to the Bank

for Negotiation

Dispatch of Documents

Acceptance of Bill of Exchange

Letter of Indemnity

Realization of Export Proceeds

Processing of GR Form

PROCEDURE FOR RELISATION OF EXPORT PROCEEDS



Master Documents and aligned Documentation Systems

Performa invoice

Commercial Invoice

Packing list

Mate’s receipt

Bill of lading

Certificate of origin

Shipping bill

Consular invoice

Bill of entry

Airway bill

GR Form

EXPORT DOCUMENTATION



Aligned DocumentationSystem (ADS) is basedon the UN Layout key.

Under this system,different forms used inthe international tradetransaction are printedon paper of the samesize and in such a way

that the common itemsof information are

given the same relativeslots in each of the

documents.

For the purpose of Aligned Documentation

System documentshave been classified as

1) CommercialDocuments and

2) RegulatoryDocuments.

M A S T E R D O C U M E N T S A N D A L I G N E D D O C U M E N T A I O N S YS T E M



Commercial documents are required for effecting physical transfer of goods andtheir title from the exporter to the importer and the realization of export saleproceeds.

Out of the 16 commercial documents in the export documentation framework

as many as 14 have been standardized and aligned to one another.

These are proforma invoice, commercial invoice, packing list, shippinginstructions, intimation declaration, certificate of inspection of quality control,insurance declaration, certificate of insurance, mate’s receipt, bill of lading or

combined transport document, application for certificate of origin, certificate of origin, shipment advice and letter to the bank for collection or negotiation of

documents.

However, shipping order and bill of exchange could not be brought within thefold of the Aligned Documentation System.

COMMERCIAL DOCUMENTS



Regulatory pre-shipment export documents are prescribed by thedifferent government departments and bodies in order to complywith various rules and regulations under the relevant laws governingexport trade such as export inspection, foreign exchange regulation,export trade control, customs, etc.

Out of 9 regulatory documents four have been standardized andaligned.

These are shipping bill or bill of export, exchange control declaration(GR form), export application dock challan or port trust copy of shipping bill and receipt for payment of port charges.

REGULATORY DOCUMENTS



The starting point of the exportcontract is in the form of offermade by the exporter to the

foreign customer.

The offer made by the exporteris in the form of a proforma

invoice. It is a quotation givenas a reply to an inquiry. It

normally forms the basis of alltrade transactions.

• It forms the basis of all trade transactions

• It may be useful for the importer in obtainingimport license or foreign exchange

Importance of the Proforma

Invoice

PERFORMA INVOICE



• Name and address of the exporter

• Name and address of the importer

• Mode of transportation, such as Sea or Air or Multimodaltransport

• Name of the port of loading

• Name of the port of discharge and final destination

• Provisional invoice number and date

• Exporter’s reference number

• Buyer’s reference number and date

• Name of the country of origin of goods

• Name of the country of final destination

• Marks and container number

• Number and packing description

• Description of goods giving details of quantity, rate andtotal amount in terms of internationally accepted pricequotation

• Signature of the exporter with date

Contents

of

Performa

Invoice

CONTINUED




It is also known as a ‘Document of Contents’ as it containsall the information required for the preparation of otherdocuments.

It is actually a seller’s bill of merchandise.

It is prepared by the exporter after the execution of exportorder giving details about the goods shipped. It is essentialthat the invoice is prepared in the name of the buyer orthe consignee mentioned in the letter of credit.

It is a prima facie evidence of the contract of sale orpurchase and therefore, must be prepared strictly inaccordance with the contract of sale.

COMMERCIAL INVOICE




Contents of

Commercial Invoice


• Name and address of the consignee

• Name and the number of Vessel or Flight


• Name of the port of discharge and final destination

• Invoice number and date

• Exporter’s reference number

• Buyer’s reference number and date

• Name of the country of origin of goods

• Name of the country of final destination

• Terms of delivery and payment


• Number and packing description

• Description of goods giving details of quantity, rate andtotal account in terms of internationally accepted pricequotation

• Signature of the exporter with date

CONTINUED




Significance of Commercial Invoice

• It is the basic document useful in preparation of various othershipping documents

• It is used in various export formalities such as quality and pre-shipment inspection, excise and customs procedures, etc.

• It is also useful in negotiation of documents for collection and

claim of incentives• It is useful for accounting purposes to both exporters as well as

importers

CONTINUED




The exporter prepares the packing list to facilitate the buyer tocheck the shipment.

It contains the detailed description of the goods packed in eachcase, their gross and net weight, etc.

The difference between a packing note and a packing list is that thepacking note contains the particulars of the content of an individualpack, while the packing list is a consolidated statement of thecontents of a number of cases or packs.

Normally, ten copies of the packing note/list should be prepared.

The first is to be sent with the shipping documents, two copies inadvance to the buyer, one to the shipping agent and the remainingretained by the exporter.

PACKING LIST




Mate’s receipt is a receipt issued by the Commanding Officer of the ship when the cargo is loaded on the ship.

The mate’s receipt is a prima facie evidence that goods are

loaded in the vessel.

The mate’s receipt is first handed over to the Port Trust

Authorities.

After making payment of all port dues, the exporter or his agent

collects the mate’s receipt from the Port Trust Authorities.

The mate’s receipt is freely transferable. It must be handed over

to the shipping company in order to get the bill of lading. Bill of lading is prepared on the basis of the mate’s receipt.

MATE’S RECEIPT




T Y

P E S O F M A T E ’ S R E C E I P T

Clean Mate’s Receipt

• The Commanding Officer of the shipissues a clean mate’s receipt, if he is

satisfied that the goods are packedproperly and there is no defect in thepacking of the cargo or package.

Qualified Mate’s Receipt

• The Commanding Officer of the shipissues a qualified mate’s receipt,

when the goods are not packedproperly and the shipping company

does not take any responsibility of damage to the goods during transit.

CONTINUED




• Name of the logo of the shipping line

• Name and address of the shipper

• Name and the number of vessel


• Name of the port of discharge and place of delivery

• Marks and container number• Packing and container description

• Total number of containers and packages

• Description of goods in terms of quantity

• Container status and seal number

• Gross weight in kg., and volume in terms of cubic meters

• Shipping bill number and date• Signature and initials of the Chief Officer

Content

of

Mate’s

Receipt

CONTINUED




CONTINUED




The bill of lading is a document issued by the

shipping company or its agent acknowledgingthe receipt of goods on board.

Undertaking to deliver the goods in the likeorder and condition as received to the

consignee or his order provided the freight

and other charges as specified in the bill havebeen duly paid.

It is also a document of title to the goods and,as such, is freely transferable by endorsement

and delivery.

• As a document of title to the goods

• As a receipt from the shipping company

• As a contract for the transportation of goods

A Bill of lading serves three main purposes:

BILL OF LADING




•Name and logo of the shipping line

•Name and address of the shipper

•Name and number of vessel

•Name of the port of loading

•Name of the port of discharge and place of delivery

•Marks and container number

•Packing and container description

•Total number of containers and packages

•Description of goods in terms of quantity

•Container status and seal number

•Gross weight in kg. and volume in terms of cubic meters

•Amount of freight paid or payable•Shipping bill number and date

•Signature and initials of the Chief Officer

Contents

of

Bill of

Lading

CONTINUED




Significance of Bill

of Lading forImporters

It acts as a document of title to goods, which is

transferable by

endorsement and delivery

The exporter sends the bill of lading to the bank of the importer

so as to enable him to take thedelivery of goods

The exporter can give an advanceintimation to the foreign buyer about

the shipment of goods by sending him anon-negotiable copy of bill of lading

Significance of Bill

of Lading forShipping Company

It is useful to the shipping companyfor collection of transport chargesfrom the importer, if not collected

from the exporter.

CONTINUED




The importers in several

countries require acertificate of origin

without which clearanceto import is refused.

The certificate of originstates that the goods

exported are originallymanufactured in the

country whose name ismentioned in the

certificate.

Certificate of origin isrequired under thefollowing circumstances.

•The goods produced in aparticular country are subjectto preferential tariff rates inthe foreign market at thetime of importation.

•The goods produced in aparticular country are bannedfor import in the foreign

market.

CERTIFICATE OF ORIGIN




• Name and logo of chamber of commerce


• Name and address of the consignee

• Name and the number of Vessel of Flight

• Name of the port of loading Name of the port of discharge and place of delivery


• Packing and container description



• Signature and initials of the concerned officer of theissuing authority

• Seal of the issuing authority

Contents

of

Certificate of

Origin

CONTINUED




• Certificate of Origin is required for availing of concessions under Generalized System of Preferences(GSP) as well as under Commonwealth Preferences(CWP).

• It is to be submitted to the customs for theassessment of duty and clearance of goods with

concessional duty.• It is required when the goods produced in a particular

country are banned for import in the foreign market.

• It helps the buyer in adhering to the importregulations of the country.

• Sometimes, in order to ensure that goods bought

from some other country have not been reshipped bya seller, a certificate of origin is required.

Significance of

the Certificate

of Origin

CONTINUED




Shipping bill is themain customsdocument required bythe customs authoritiesfor granting permissionfor the shipment of goods.

• Customs Copy

• Drawback Copy

• Export Promotion Copy

• Port Trust Copy

• Exporter’s Copy

The cargo is movedinside the dock areaonly after the shippingbill is duly stamped,i.e., certified by thecustoms. Shipping bill

is normally prepared infive copies:

SHIPPING BILL






• Name of the vessel, master or agents and flag

• Name of the port at which goods are to be discharged

• Country of final destination• Details about packages, description of goods, marks

and numbers, quantity and details of each case

• FOB price and real value of goods as defined in theSea Customs Act

• Whether Indian or foreign merchandise to be re-

exported• Total number of packages with total weight and value

Contents

of Shipping

Bill

CONTINUED




Significance of Shipping Bill

Shipping bill is the main customs documentrequired by the customs authorities for granting

permission for the shipment of goods

The cargo is moved inside the dock area only after theshipping bill is duly stamped i.e., certified by the customs

Duly endorsed shipping bill is also necessary for the collection of exportincentives offered by the government

It is useful to the Customs Appraiser while determining the actual value of goods exported

CONTINUED




Consular Invoice is a document required by the Latin American countries like Kenya, Uganda,

Tanzania, Mauritius, New Zealand, Myanmar, Iraq, Australisa, Fiji, Cyprus, Nigeria, Chana, Guinea,Zanzibar, etc.

This invoice is the most important document, which needs to be submitted for certification to theEmbassy of the importing country concerned.

The main purpose of the consular invoice is to enable the authorities of the importing country to

collect accurate information about the volume, value, quality, grade, source, etc., of the goods

imported for the purpose of assessing import duties and also for statistical purposes.

In order to obtain consular invoice, the exporter is required to submit three copies of invoice to theConsulate of the importing country concerned.

The Consulate of the importing country certifies them in return for fees. One copy of the invoice isgiven to the exporter while the other two are dispatched to the customs office of the importer’s

country for the calculation of the import duty. The exporter negotiates a copy of the consularinvoice to the importer along with other shipping documents.

CONSULAR INVOICE




The Bill of Entry is a document prepared by the importer or his clearing agent inthe prescribed form under Bill of Entry Regulation, 1971, on the strength of

which clearance of imported goods can be made.

When goods are imported in a particular country, the importer has to pay thenecessary import duty.

For this purpose, necessary information about the goods imported must begiven to the customs authorities in a prescribed form called bill of entry form.

Bill of entry is a document, which states that the goods of the stated values anddescription in the specified quantity have entered into the country fromabroad.

The bill of entry is drawn in triplicate. The customs authorities may ask theimporter to supply other documents like invoice, broker’s note and insurance

policy, etc. in order to verify the correctness of the information supplied in thebill of entry form.

BILL OF ENTRY






• Import license number of the importer

• Name of the port/dock where goods areto be cleared

• Description of goods

• Value of goods

• Rate and amount of import duty payable

• Other relevant documen

Contentsof Bill of

Entry

CONTINUED




An Airway Bill, also called an air consignment note, is areceipt issued by an airline for the carriage of goods. Aseach shipping company has its own bill of lading, so eachairline has its own airway bill.

Airway Bill or Air Consignment Note is not treated as a

document of title and is not issued in negotiable form.

Content of Airway Bill

• Name of the airport of departure and destination

• Names and addresses of the consignor, consignee and the first carrier• Marks and container number

• Packing and container description



• Container status and seal number

• Amount of freight paid or payable

• Signature and initials of the issuing carrier or his agent

AIRWAY BILL




GR Form is an exchange control document required by the Reserve Bank of India (RBI). As per the exchange control

regulations,

an exporter has to realize the proceeds of the goods he has exported within 180 days of their shipment from India.In order to ensure this, the RBI has introduced the GR procedure.

GR form is to be submitted in duplicate to the Customs at the port of shipment along with the shipping bill.

Customs will give their running serial number on both the copies after admitting the customs shipping bill.

Customs authorities will certify the value declared by the exporter on both the copies of the GR form at the spaceremarked and will also record the assessed value.

They will then return the duplicate copy of the form to the exporter and retain the original for transmission to theRBI. Within 21 days from the shipment of goods, exporter must lodge the duplicate copy of GR together with relativeshipping documents with the authorized dealer named in the GR form for negotiation of export bills.

GR FORM



Thank You!!!

References:Vasant Kothari PDF.Discussion with Er. Shakhar suman,Site Engineer, Virgo marine,Mumbai