Welcome to the Trade Compliance & Customs

Movement of Goods Training Module

Parties and Flow

Multiple parties involved in the logistics process of moving goods.

 Two supply chain flows between exporter and importer

– Physical flow
– Documentation flow
 Several parties contribute to the success of operations
– Exporter
– Carriers
– Customs authorities
– Freight forwarders
– Customs brokers
– Importer

Freight Forwarder Freight Forwarder

Exporter Carrier Customs Carrier Importer
Customs Broker Customs Broker
Documentation

 Exporter and importer complete

administrative documents and follow
customs procedures
 Basic documentation for all export
transactions
 Simple transactions:
– Commercial invoice
– Bill of Lading
– Export Declaration
 Extensive documentary requirements for
complex transactions:
– Export License
– Export Permit
– Authorization from other
governmental agencies
– Pre-shipment inspection
Key Export Documents

Country of
Country of Export
Export Authority

Most international transactions based on:

 Commercial Invoice
 Bill of Lading
 Certificate of Origin
 Export Declaration
Commercial Invoice

Commercial Invoice:
 Issued by Exporter
 Key transaction or accounting document
 Identifies seller and buyer
 Gives identifying numbers such as Invoice
Number
 Invoice date and shipping date
 Identifies country of origin
 Mode of transport
 Harmonized Tariff Code
 Delivery and payment terms
 Complete list and description of goods
– Quantities
– Prices
– Discounts
Bill of Lading

Bill of Lading:
 Used by carrier of goods
 Key transaction document
 Issued by shipping line or airline to exporter
 Signed by the captain, agent or owner of
vessel
 Written evidence of receipt of goods
 Written evidence of conditions on which
transportation made
 Engagement to deliver goods at prescribed
destination to holder
 Both a receipt and a delivery contract
Certificate of Origin

Certificate of Origin:
 Issued by exporter, exporting country’s chamber
of commerce or other authorizing agency
 Establishes country of origin of shipped goods
 Importer submits to import country’s authority
Export Declaration

Formal statement to export authority

 Identifies
– Seller or buyer
– Goods shipped
– Date of issuance
– Country of origin and final destination of
goods
– Quantity and description of goods
– Shipping details
 Quantity and weight of shipment is mandatory
 Harmonized Tariff Code should be included to aid
in calculating duties
 Customs Procedure Code is provided on the
Export Declaration
 Key code to customs regimes
Additional Documents

Additional documents might be required:

 Shipping instructions
 Forwarding instructions
 Stowage instructions
 Hazardous Materials / Dangerous Goods instructions
Shipping Instructions

Shipping Instructions:
 Form letter issued by consignor
 Instructions to shipping company
 Bill of Lading drawn from this
information
 Pre-printed forms or computerized
entry
 Consignors who provide Bill of Lading
must attach shipping instructions
Forwarder’s Instructions

Forwarder’s Instructions:
 Issued by consignor
 Specific and formal instructions to

freight forwarder
– Booking shipment
– Information for transport
documents
 Completed on Freight Forwarder’s
form or consignor’s letterhead
Stowage Instructions

Stowage Instructions:
 Issued by consignor
 Consignor’s letterhead or shipping
line or freight forwarder’s form
 How or where shipment should be
stowed during transport

Shipper may require shipment to be

placed below deck and amidships
for greater protection from the
elements and movement of the
ship.
Hazardous Materials/Dangerous Goods Instructions

Hazardous Materials/Dangerous Goods

Instructions:
Hazardous Material is substance or product posing risk
to health, safety or property when transported in
commerce
US Hazard Materials Regulations (49 CFR Subchapter
C)Hazards classified as ORM with A - E designation
Includes information on life or health threatening
materials
Special handling instructions must be provided
Containers must be properly emblazoned with
international warning labels or stickers
 Example Scenario

How does Logistics put all the details and documents together for
fully compliant movement of goods?
Unloading

Customs Warehousing and

Clearance Goods Receipt & handling Unpackin
& payment g
Shipment
License &
Country
declarations
Transport border
Warehousing Shipment
Invoice & & handling
Packed certificates
Goods
Example Scenario – The Request

Critical answers Saskia needs:

 What is she exporting?
 Where is she exporting?
 Who will receive the item?
 How will the item be used?
Example Scenario – The Product

 The product is a DVD manufactured in the US that contains a Minitron

 Restrictions on dual-use items
 Contact Area TCC Coordinator to see what export licenses, if any, are
available
– Where was product manufactured?
– What parts and components make up the product?
– What possible restrictions could be placed on the product?
– What laws and regulations govern these products?
Example Scenario – The Authorizations

 Commodities subject to many jurisdictions while being moved

 Authorizations placed with conditions
 Check what possible authorizations and conditions must be
met before proceeding
Example Scenario – The Restrictions

 Multi- and unilateral trade restrictions placed on countries

 Certain entities, individuals or regimes also subject to trade restrictions
 Denial-lists screening available through TCC website
– Search by entities and individual names
Example Scenario – End of Use

 Schlumberger is in the primary business of performing oil and gas

exploration services
 Product would not be used in another manner
 If selling this tool to a third party
– Need to know in what manner the tool would be used
When Schlumberger sells goods to third parties, it is necessary to know
how the products will be used.
Example Scenario – Non Compliance

Important to learn potential pitfalls for non-compliance when exporting

and importing
 Be aware which countries subject to trade restrictions
 Problems can happen
– Before a product ships
– Once a product is in route
– When product reaches its destination
Example Scenario – Import Manual

 Consult the import manual before

exporting a product
 Certain import restrictions or
requirements could cause delay in
import process
 Many factors must be met when
importing goods
– Free trade agreement
– Temporary import
Import Documentation

Most countries require basic documentation for import transactions

Simple transactions:
 Non-regulated commodities
 Goods from non-regulated countries
May include:
 Commercial invoices
 Bill of lading
 Import declaration
Extensive documentary requirements for the import of certain goods
May require: Country of
 Import licenses Country of
Import
 Import permits Import
 Authorization from other governmental agencies Authority
 Pre-shipment inspections
Extensive regulations in hard currencies add an additional set of
restrictions
Some countries restrict imports by imposing documentation requirements
to protect domestic producers.
 Non-tariff trade barriers
 Subject of controversy
Import Declaration

Import Declaration:
 Prepared by importer or customs broker acting as
agent
 Formal statement to export authority
 Identifies:
– Seller
– Buyer
– Goods shipped
– Date of issuance
– Country of origin
– Country of final destination
– Quantity and description of goods
– Shipping details
 Used by country of import
– Control imports
– Compile trade statistics
– Assess fees
Classification, Valuation, Country of Origin

 Three pieces of information essential for customs clearance process to

determine duty and tax liability
- Classification – what the product is
- Valuation – what the product is worth
- Country of Origin – where the product was manufactured (NOT
where it was shipped from)
The Power of Customs

 Customs has the power to slow or even

stop processing of transaction perceived
to be non compliant
 Authorities can assess fines and penalties
– In some cases reaching millions of
dollars
– Flag company for non compliance
and subject future imports to 100%
screening
– Delays cause loss of revenue
 It is policy that all employees comply with
all local import regulations when
conducting business
Customs Brokers

Customs brokers are service brokers working on behalf of Schlumberger

 File import documents
 Ensure imported goods move from arriving carrier to destination
 Brokers do not import goods – Schlumberger incurs legal liability and
responsibility for all violations

 Refer to Import manual

– Outlines instructions for processing and maintaining import
transactions and documents
– Goods may qualify for special tariff treatments
– These have special compliance burdens which must be met
How to Comply

The key elements to import

compliance:
 Recordkeeping
 Classification
 Valuation
 Country of Origin
 Distinguishing between
temporary and permanent import
 Understanding that Customs
Broker works on Schlumberger’s
behalf but Schlumberger
maintains legal liability
Recordkeeping

Recordkeeping:
 Critical in process of import
compliance
 Problems are oftentimes not the
mistakes but lack of documentation
to prove otherwise
 Documents must be retained for
minimum of five years from date of
entry
– Unless local regulations require
longer retention period
Temporary Imports

Temporary Imports:
 Privilege granted by local
authorities
 Monetary benefits but extensive

compliance burdens
 Goods imported temporarily
require careful tracking
– Corresponding documents
require careful tracking
– Must be exported in
required time
Where to find help

Schlumberger products move in and out of countries ensuring on-time delivery of goods and
maintain customer satisfaction.
 Critical that Schlumberger is in compliance with export and import regulations
Remember the four questions necessary to answer before export:
 What is being exported?
 Where is it is being exported?
 Who will receive the item?
 How will the item be used?
 Responsibility of the Logistics department to embed
 Movement of Goods processes
 Numerous resources available to facilitate employees
 Expected to seek help from one of the following resources
Help is at hand:
Trade Compliance & Customs Group
TCC Hub
Conclusion

This concludes the Trade Compliance & Customs

Movement of Goods Training Module