EXPORT DOCUMENTATION

Introduction How to Start Export is a fair question that every first time exporter wants to ask. Export in itself is a very wide concept and lot of preparations is required by an exporter before starting an export business. A key success factor in starting any export company is clear understanding and detail knowledge of products to be exported. In order to be a successful in exporting one must fully research its foreign market rather than try to tackle every market at once. The exporter should approach a market on a priority basis. Overseas design and product must be studies properly and considered carefully. Because there are specific laws dealing with International trade and foreign business, it is imperative that you familiarize yourself with state, federal, and international laws before starting your export business. Price is also an important factor. So, before starting an export business an exporter must considered the price offered to the buyers. As the selling price depends on sourcing price, try to avoid unnecessary middlemen who only add cost but no value. It helps a lot on cutting the transaction cost and improving the quality of the final products. However, before we go deep into "How to export ? let us discuss what an export is and how the Government of Indian has defined it. In very simple terms, export may be defined as the selling of goods to a foreign country. However, As per Section 2 (e) of the India Foreign Trade Act (1992), the term export may be defined as 'an act of taking out of India any goods by land, sea or air and with proper transaction of money. Exporting a product is a profitable method that helps to expand the business and reduces the dependence in the local market. It also provides new ideas, management practices, marketing techniques, and ways of competing, which is not possible in the domestic market. Even as an owner of a domestic market, an individual businessman should think about exporting. Research shows that, on average, exporting companies are more profitable than their non-exporting counterparts. Why Need to Export There are many good reasons for exporting: The first and the primary reason for export is to earn foreign exchange. The

foreign exchange not only brings profit for the exporter but also improves the economic condition of the country. Secondly, companies that export their goods are believed to be more reliable than their counterpart domestic companies assuming that exporting company has survive the test in meeting international standards. Thirdly, free exchange of ideas and cultural knowledge opens up immense business and trade opportunities for a company. Fourthly, as one starts visiting customers to sell ones goods, he has an opportunity to start exploring for newer customers, state-of-the-art machines and vendors in foreign lands. Fifthly, by exporting goods, an exporter also becomes safe from offset lack of demand for seasonal products. Lastly, international trade keeps an exporter more competitive and less vulnerable to the market as the exporter may have a business boom in one sector while simultaneously witnessing a bust in a different sector. No doubt that in the age of globalization and liberalizations, Export has became of the most lucrative business in India. Government of India is also supporting exporters through various incentives and schemes to promote Indian export for meeting the much needed requirements for importing modern technology and adopting new technology from MNCs through Joint ventures and collaboration.

Introduction An exporter without any commercial contract is completely exposed of foreign exchange risks that arises due to the probability of an adverse change in exchange rates. Therefore, it becomes important for the exporter to gain some knowledge about the foreign exchange rates, quoting of exchange rates and various factors determining the exchange rates. In this section, we have discussed various topics related to foreign exchange rates in detail. Export from India required special document depending upon the type of product and destination to be exported. Export Documents not only gives detail about the product and its destination port but are also used for the purpose of taxation and quality control inspection certification.

Shipping Bill / Bill of Export Shipping Bill/ Bill of Export is the main document required by the Customs Authority for allowing shipment. A shipping bill is issued by the shipping agent and represents some kind of certificate for all parties, included ship's owner, seller, buyer and some other parties. For each one represents a kind of certificate document. In exercise of the powers conferred by section 157, read with sections 50 and 60, of the Customs Act, 1962 (52 of 1962), and in supersession of the Shipping Bill and Bill of Export (Form) Regulations, 1976, except as respect things done or omitted to be done before such supersession, the Central Board of Excise and Customs hereby makes the following regulations, namely: 1. Short title and commencement. 1. These regulations may be called the Shipping Bill and Bill of Export (Form) Regulations, 1991. 2. They shall come into force on the 1st day of October, 1991. 2. Shipping Bill. A shipping bill to be presented by an exporter of goods shall be in the form specified in Annexure I, Annexure II, Annexure III or Annexure IV, as the case may be, appended to these regulations. 3. Bill of Export. A bill of export to be presented by an exporter of goods be in the form specified in Annexure V, Annexure VI, Annexure VII or Annexure VIII, as the case may be, appended to these regulations. 4. Specifications of Shipping Bill and Bill of Export (Form). The Shipping Bill and Bill of Export forms specified in Annexures I to VIII shall be in accordance with the following specifications, namely :a. the forms shall be printed on foolscap size of paper measuring 34.5 cms by 21.5 cms and shall have the following margins namely :i. top -1.5 cms, ii. bottom -1.5 cms, iii. left -1.8 cms, iv. right - 0.5 cms. The layout of the forms and the sizes of the boxes shall be as per the layout and boxes shown in the Annexures; b. the forms shall be printed on paper of grammage 70 to 85 grams per square metre; the paper should be stable in conditions of 50 to 60 per cent relative humidity; c. the captions, insidethe boxes of-the forms should the printed in 6 pt. mono sans-serif and should be located as near as possible to the top left of the boxes;

d. the forms shall be filled in by using a typewriter only.

Documents Required for Post Parcel Customs Clearance In case of Post Parcel, no Shipping Bill is required. The relevant documents are mentioned below:

Customs Declaration Form - It is prescribed by the Universal Postal Union (UPU) and international apex body coordinating activities of national postal administration. It is known by the code number CP2/ CP3 and to be prepared in quadruplicate, signed by the sender.

Despatch Note- It is filled by the exporter to specify the action to be taken by the postal department at the destination in case the address is non-traceable or the parcel is refused to be accepted.

Commercial Invoice - Issued by the exporter for the full realisable amount of goods as per trade term. This is a basic export document. It contains all the information which is required for the preparation of all other documents. It is the exporters bill for goods. There is no standard form for such invoice, but it can be designed as per the requirements of the exporter. However, if any information to be included as per the special requirement of the importer, it must be compiled with many countries like cnada,USA,etc. require special type of invoice.

This commercial invoice should contain:1) The name and address of the exporter. 2) The name and address of the importer. 3) The description of goods, like quality, quantity, weight etc 4) The Value of goods, less discounts, if any 5) The net amount payable by the importer. 6) Terms & Conditions of sale. 7) The signature of the exporter.

8) Name of the ship. 9) L/C number 10) Import-Export licence number of the exporter. 11) Bill of Lading number. 12) Packaging specifications. 13) Identification marks on the package. 14) Shipping bill number and date. 15) Shipping terms and conditions. 16) Freight charges. 17) Marine Insurance premium. 18) Any other details, if required.

Consular Invoice - Mainly needed for the countries like Kenya, Uganda, Tanzania, Mauritius, New Zealand, Burma, Iraq, Ausatralia, Fiji, Cyprus, Nigeria, Ghana, Zanzibar etc. It is prepared in the prescribed format and is signed/ certified by the counsel of the importing country located in the country of export. This countries require that the goods imported in their country should be certified by the Consulate of their country stationed in the exports country. The exporter has to pay a certain fee to obtain this certificate/invoice. Such charges/fees vary from country to country. This invoice facilitates prompt clearance of goods from the customs authorities in the importing country.

Customs Invoice - Mainly needed for the countries like USA, Canada, etc. It is prepared on a special form being presented by the Customs authorities of the importing country. It facilitates entry of goods in the importing country at preferential tariff rate.

Legalised / Visaed Invoice - This shows the seller's genuineness before the appropriate consulate or chamber or commerce/ embassy.

Certified Invoice - It is required when the exporter needs to certify on the invoice that the goods are of a particular origin or manufactured/ packed at a particular place and in accordance with specific contract. Sight Draft and Usance Draft are available for this. Sight Draft is required when the exporter expects immediate payment and Usance Draft is required for credit delivery.

Packing List - It shows the details of goods contained in each parcel / shipment. Considerably more detailed and informative than a standard domestic packing list, it itemizes the material in each individual package and indicates the type of package, such as a box, crate, drum or carton. Both commercial stationers and freight forwarders carry packing list forms.

Certificate of Inspection It is a type of document describing the condition of goods and confirming that they have been inspected. Required by some purchasers and countries in order to attest to the specifications of the goods shipped. This is usually performed by a third party and often obtained from independent testing organizations.

Black List Certificate - It is required for countries which have strained political relation. It certifies that the ship or the aircraft carrying the goods has not touched those country(s).

Manufacturer's Certificate - It is required in addition to the Certificate of Origin for few countries to show that the goods shipped have actually been manufactured and is available.

Certificate of Chemical Analysis - It is required to ensure the quality and grade of certain items such as metallic ores, pigments, etc.

Certificate of Shipment - It signifies that a certain lot of goods have been shipped.

Health/ Veterinary/ Sanitary Certification - Required for export of foodstuffs, marine products, hides, livestock etc.

Certificate of Conditioning - It is issued by the competent office to certify compliance of humidity factor, dry weight, etc.

Antiquity Measurement It is issued by Archaeological Survey of India in case of antiques.

Shipping Order - Issued by the Shipping (Conference) Line which intimates the exporter about the reservation of space of shipment of cargo through the specific vessel from a specified port and on a specified date.

Cart/ Lorry Ticket - It is prepared for admittance of the cargo through the port gate and includes the shipper's name, cart/ lorry No., marks on packages, quantity, etc.

Shut Out Advice - It is a statement of packages which are shut out by a ship and is prepared by the concerned shed and is sent to the exporter.

Short Shipment Form - It is an application to the customs authorities at port which advises short shipment of goods and required for claiming the return.

Bill Of Lading A bill of lading is a document issued by the shipping company upon shipment of the goods. It is a contract between the shipper(exporter) and the shipping company for the carriage of goods to the port of destination. It is a document title to goods and as such required by the importer to clear the goods at the port of destination.

A bill of lading normally contains the following details : 1) The name of the shipping company. 2) The name and address of the shipper/exporter. 3) The name and address of the importer/agent. 4) The name of the ship. 5) Voyage number and date. 6) The name of the ports of shipment and discharge. 7) The name of the ports of shipment and discharge. 8) Quality, quantity, marks and other description. 9) The number of packages. 10) Whether freight paid or payable. 11) The number of originals issued. 12) The date of loading of goods on the ship. 13) The signature of the issuing authority.

Common Export Documents for Air Freight

The following documents are commonly used in exporting; but which of them are necessary in a particular transaction depends on the requirements of the U.S. government and the government of the importing country. Shippers Export Declaration (SED or form 7525-V) The SED is available through the Government Printing Office and a number of other commercial outlets. It can be electronically filed using AESDirect. A NAFTA Certificate of Origin is needed for shipments to Mexico and Canada. This tool can help you through the process of filing this certification. CE Mark requirements must be met to market goods in the European Union. Once a manufacturer has earned a CE mark for its product, it may affix the CE Mark to its product, and then the product may be marketed thoughout the EU without having to undergo further modifications in each EU member country. Export license - a U.S. Government document required for dual use exports (commercial items which could have military applications), or exports to embargoed countries. Most export transactions do not require specific approval from the U.S. Government. Before shipping your product, make sure you understand the concept of dual use and the basic export control regulations. Commercial invoice - a bill for the goods from the seller to the buyer. These invoices are often used by governments to determine the true value of goods when assessing customs duties. Governments that use the commercial invoice to control imports will often specify its form, content, number of copies, language to be used, and other characteristics. Certificate of origin - The Certificate of Origin is only required by some countries. In many cases, a statement of origin printed on company letterhead will suffice. Special certificates are needed for countries with which the United States has special trade agreements, such as Mexico, Canada and Israel. More information about filling out these special certificates is available from the TIC. Bill of lading - is a contract between the owner of the goods and the carrier (as with domestic shipments). For vessels, there are two types: a straight bill of lading which is non-negotiable and a negotiable or shippers order bill of lading. The latter can be

bought, sold, or traded while the goods are in transit. The customer usually needs an original as proof of ownership to take possession of the goods. Insurance certificate - is used to assure the consignee that insurance will cover the loss of or damage to the cargo during transit. These can be obtained from your freight forwarder. Export packing list - considerably more detailed and informative than a standard domestic packing list, it itemizes the material in each individual package and indicates the type of package, such as a box, crate, drum, or carton. Both commercial stationers and freight forwarders carry packing list forms. Import License Import licenses are the responsibility of the importer. Including a copy with the rest of your documentation, however, can sometimes help avoid problems with customs in the destination country. Consular invoice - Required in some countries, it describes the shipment of goods and shows information such as the consignor, consignee, and value of the shipment. If required, copies are available from the destination countrys Embassy or Consulate in the U.S. Air way bills - Air freight shipments are handled by air waybills, which can never be made in negotiable form. Inspection certification is required by some purchasers and countries in order to attest to the specifications of the goods shipped. This is usually performed by a third party and often obtained from independent testing organizations. A dock receipt and a warehouse receipt are used to transfer accountability when the export item is moved by the domestic carrier to the port of embarkation and left with the ship line for export. A destination control statement appears on the commercial invoice, and ocean or air waybill of lading to notify the carrier and all foreign parties that the item can be exported only to certain destinations.