Q.3:- Discuss the principal documents used in exporting.
Following are the principal documents used in exporting
(i) Documents Related to Goods
(a)Export Invoice Export invoice is a sellers’ bill for merchandise and contains information about goods such as quantity, total value, number of packages, marks on packing, port of destination, name of ship, bill of lading number, terms of delivery and payments, etc.
(b) Packing List A packing list is a statement of the number of cases or packs and the details of the goods contained in these packs. It gives details of the nature of goods, which are being exported and the form in which these are being sent.
(c) Certificate of Origin This is a certificate which specifies the country in which the goods are being produced which entitles the importer to claim tariff concessions or other exemptions on goods originating from certain pre-specified countries.
(d) Certificate of Inspection For ensuring quality, the government has made it compulsory for certain products to be inspected by some authorized agency like Export Inspection Council of India (EICI) which issues the certificate that the consignment has been inspected as required under the Export (Quality Control and Inspection) Act, 1963, and satisfies the conditions relating to quality control and inspection as applicable to it, and is export worthy.
(ii) Documents Related to Shipment
(a) Mate’s Receipt The mate’s receipt indicates the name of the vessel, berth, date of shipment, description of packages, marks and numbers, condition of the cargo at the time of receipt on board the ship, etc. and is given by the commanding officer of the ship to the exporter after the cargo is loaded on the ship.
(b) Shipping Bill The shipping bill contains particulars of the goods being exported, the name of the vessel, the port at which goods are to be discharged, country of final destination, exporter’s name and address, etc. It is the main document on the basis of which custom; office grants permission for the export.
(c) Bill of Lading/Airway Bill Bill of lading is issued by the shipping company after receipt of the freight, which serves as an evidence that the shipping company has accepted the goods for carrying to the designated destination. In the case the goods are being sent by air, this document is referred to as airway bill.
(d) Marine Insurance Policy It is a certificate of insurance contract whereby the insurance company agrees in consideration of a payment called premium to indemnify the insured against loss incurred by the latter in respect of goods exposed to perils of the sea.
(iii) Documents Related to Payment
(a) Letter of Credit A letter of credit is a guarantee issued by the importer’s bank that it will honor up to a certain amount the payment of export bills to the bank of the exporter. Letter of credit is the most appropriate and secure method of payment adopted to settle international transactions.
(b) Bill of Exchange Bill of exchange is a written instrument drawn by exporter on the importer asking the latter to pay a certain amount to a certain person or the bearer of the bill of exchange. The documents giving title to the export consignment are passed on to the importer only when the importer accepts the order contained in the bill of exchange.
(c) Bank Certificate of Payment Bank certificate of payment is a certificate that the necessary documents relating to the particular export consignment has been presented to the importer for payment and the payment has been received in accordance with the exchange control regulations.