Chapter 22

Export Procedures And Documents

International Marketing Chapter 22 Export Procedures and Documents

Objectives

What are the important steps in export transaction What are the standardized and aligned pre-shipment documents What are the documents related to goods What are the certificates related to shipment
International Marketing Chapter 22 Export Procedures and Documents

What are the documents payment What are the documents inspection What are the documents excisable goods What are the documents exchange regulation

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International Marketing Chapter 22 Export Procedures and Documents

Introduction

The exporting activity involves several commercial and regulatory procedures. These procedures also involve considerable documentation requirements. The export documentation involves the preparation of the specified number of copies of the prescribed documents pertaining to the different procedures.
International Marketing Chapter 22 Export Procedures and Documents

Preliminaries Steps

IEC number the IEC numbers are normally allotted by the regional licensing authorities. Membership cum registration : membership of certain bodies will help the exporters in a number of ways Inquiry and offer : An inquiry is a request from a prospective importer to be informed of the terms and conditions of sale.
International Marketing Chapter 22 Export Procedures and Documents

Confirmation of order : Once the negotiation are completed and conditions are acceptable to the buyer and seller, the buyer may place and order with the exporter. Export license : the exports of some items are banned and of some items controlled by means of licenses, though many items are permitted to be exported freely. International Marketing Chapter 22 Export Procedures and Documents

Finance : If the exporter require preshipment financial assistance, he should take the necessary steps to obtain it. Production/procurement of goods : Once the order is confirmed, the exporter should take necessary steps to ensure the timely availability of the goods of the specifications required and execute the export order promptly.
International Marketing Chapter 22 Export Procedures and Documents

Shipping space : As soon as the export order is confirmed, the exporter should contract the shipping companies which have sailings for the port to which goods have to be sent and book the required shipping space. Packing and marketing : once the goods are ready, they are packed and marked properly.
International Marketing Chapter 22 Export Procedures and Documents

Quality control and pre-shipment inspection : Needless to say, goods should be exported only after ensuring that they are of proper quality. Excise clearance : As a matter of policy, the government has granted excise duty exemption for export products.
International Marketing Chapter 22 Export Procedures and Documents

Customs Formalities

1. 2.

3. 4.

Goods may be shipped out of India only after Customs clearance has been obtained. Following documents to the customs authorities, Shipping bill Declaration regarding truth or statement made in the shipping bill Invoice International Marketing Chapter 22 Export Procedures and GR form
Documents

5. 6. 7. 8. 9. 10. 11. 12.

Export licence Quality control inspection certificate Original contract, wherever available or correspondence leading to contract Contract registration certificate Letter of credit Packing list AR-4 form Any other documents
International Marketing Chapter 22 Export Procedures and Documents

Exchange Control Formalities

An exporter, who has sent goods outside the country, has the obligation to satisfy the Reserve Bank of India that he has received payment from his overseas buyer. Make a declaration on the prescribed form to the Collector of Customs that foreign exchange, representing the full export value of goods, has been or will be disposed of in the manner and within the period specified by the RBI
International Marketing Chapter 22 Export Procedures and Documents

Negotiate all shipping documents, including those relating to sales on consignment basis, through authorized dealers. Receive payment by an approved method Surrender the foreign exchange received from exports to the exchange control authority through authorized dealers.
International Marketing Chapter 22 Export Procedures and Documents

Shipping The Goods

1.

Goods may be exported to foreign by sea, air, post, land or river. Shipping by sea : To obtain the permission of the port authorities for the movement of goods into the port, it is necessary to present the cart ticket to the gate warden/inspector/keeper at the port gate.
International Marketing Chapter 22 Export Procedures and Documents

2.

3.

Shipping By Air : Shipping by air has become popular for such products as commodities which are perishable and seasonal or high in cost but low in bulk. Shipping By Post : Shipping of goods may be effected by post, subject to the foreign trade and foreign exchange regulations of the country.
International Marketing Chapter 22 Export Procedures and Documents

4.

Shipping By Land : The procedure for the export of excisable goods by land to countries like Afghanistan is, by and large, similar to the one laid down for export by sea.

International Marketing Chapter 22 Export Procedures and Documents

Negotiation Of Documents

After shipping the goods, the exporter should arrange to obtain payment for the exports by negotiating the relevant documents through the bank.

International Marketing Chapter 22 Export Procedures and Documents

Export Incentives

If the exporter is entitled to any export incentives, he should take the necessary steps to realize it (them).

International Marketing Chapter 22 Export Procedures and Documents

Principal Export Documents

Commercial invoice Packing list Bill of lading Combined transport document Certificate of inspection/quality control Insurance certificate/policy Certificate of origin Bills of exchange and shipment advice
International Marketing Chapter 22 Export Procedures and Documents

Auxiliary Documents
1. 2. 3. 4. 5. 6. 7. 8.

Performa invoice Intimation for inspection Shipping instructions Insurance declaration Shipping order Mate receipt Application for certificate of origin Letter to the bank for collection/negotiation of documents.
International Marketing Chapter 22 Export Procedures and Documents

Regulatory Documents
1.

2.

3.

4.

Gate pass-1/gate pass-2 prescribed by Central Excise Authorities AR4/AR4A form - prescribed by Central Excise Authorities Shipping Bill/Bill of Export - prescribed by Central Excise Authorities Export Application/Dock Challan Prescribed by Port Trust.
International Marketing Chapter 22 Export Procedures and Documents

5. 6. 7.

8. 9.

Receipt for payment of Port Charges Vehicle Ticket Exchange Control Declaration Prescribed by RBI GR/PP Forms Freight Payment Certificate Insurance Premium Payment Certificate
International Marketing Chapter 22 Export Procedures and Documents

Documents Related To Goods

Invoice : An invoice is the sellers bill for merchandise and contains particulars of goods, such as the price per unit at a particular location, quantity, total value, packing etc.

International Marketing Chapter 22 Export Procedures and Documents

2.

Packing Note and List : Difference between a packing note and a packing list is that the packing note refers to the particulars of the contents of an individual pack, while the packing list is a consolidated statement of the contents of a number of cases or packs.
International Marketing Chapter 22 Export Procedures and Documents

3.

Certificate of origin : A certificate of origin, as the name indicates, is a certificate which specifies the country of the production of the goods.

International Marketing Chapter 22 Export Procedures and Documents

Certificates Related To Shipment

Mate receipt : A mate receipt is a receipt issued by the Commanding Office of the ship when the cargo is loaded on the ship, and containts information about the name of the vessel, berth, date of shipment, description of packages, marks and numbers, conditions of the cargo at the time of receipt on board the ship etc.
International Marketing Chapter 22 Export Procedures and Documents

2.

Shipping Bill : The shipping bill is the main document on the basis of which the Customs permission for export is given.

International Marketing Chapter 22 Export Procedures and Documents

3.

Cart Ticket : A cart ticket, also known as a cart chit, vehicle and gate pass, is prepared by the exporter and includes details of the export cargo in terms of the shippers name, the number of packages, the shipping bill number, the port of destination and the number of the vehicle carrying the cargo.
International Marketing Chapter 22 Export Procedures and Documents

4. 5. 6.

Certificate of Measurement Bill of Lading Airway Bill

International Marketing Chapter 22 Export Procedures and Documents

Documents Related To Payment

Letter of credit Bill of exchange Trust receipt Letter of hypothecation Bank certificate of payment

International Marketing Chapter 22 Export Procedures and Documents

Documents Relating To Inspection

Certificate Of Inspection : It is a certificate issued by the Export Inspection Agency, certifying that the consignment has been inspected as required under the Export (Quality Control and Inspection) Act, 1963.
International Marketing Chapter 22 Export Procedures and Documents

Documents Related To Excisable Goods

G. P. Forms Form C Forms A.R.-4/A.R.-4A

International Marketing Chapter 22 Export Procedures and Documents

Summary

Some important steps and documents in export transaction are : preliminaries, inquiry and offer, confirmation of order, export license, finance, procurement of goods, shipping space, packing and marking, quality control and pre-shipment inspection, excise clearance, customs formalities, exchange control formalities, insurance, shipping goods, negotiation of documents and export incentives.
International Marketing Chapter 22 Export Procedures and Documents

There are two dozen commercial and regulatory documents involved in preshipment stage of an export transaction. The different commercial and regulatory documents may be classified into documents related to goods, documents related to shipment, documents related to payment, documents related to inspection etc.
International Marketing Chapter 22 Export Procedures and Documents