As per DGFT Notification dated March 12, 2015, Indian exporters and importers require the following three mandatory documents in foreign trade.
MANDATORY DOCUMENTS IN INDIA FOR EXPORT & IMPORT
|Bill of Lading/ Airway Bill
|Bill of Lading/ Airway Bill
|Commercial Invoice cum Packing List
|Commercial Invoice cum Packing List
|Shipping Bill/ Bill of Export
|Bill of Entry
A Bill of Lading is a document of title issued by a Carrier to a Shipper, confirming goods were received in an acceptable condition and are ready to be shipped and delivered to the consignee. An airway bill serves as a receipt of goods by the airline as well as a contract of carriage between the shipper and the carrier. (To know more click: Bill of lading)
A commercial invoice is issued by the exporter for the full realizable amount of goods as per trade term. Once the goods are packed and ready, a commercial invoice is prepared by the exporter. The customs counter signs it before shipping.
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, including the ship’s owner, seller, buyer, and some other parties. Each one represents a kind of certificate document. (To know more click: shipping bill)
In the case of a Post Parcel, no Shipping Bill is required. The relevant documents are mentioned:
LEO: Let export order is the final customs clearance procedure to export any goods outside the country. Similarly, pass out or ‘Passed out of customs’ is the concluding procedure of import customs clearance procedures to take delivery of imported goods. (Click: LEO for details)
A Bill of Entry (BOE) is a legal document filed by importers or customs clearing agents upon the arrival of imported goods. It is submitted to the customs authority.
Other lists of documents generally required for foreign trade:
• Customs Declaration Form – As the carrier, the Post has an obligation to submit exported or imported goods to customs control. It is prescribed by the Universal Postal Union (UPU) and the international apex body coordinating activities of the national postal administration. It is known by the code number CP2/ CP3 and to be prepared in quadruplicate, signed by the sender.
• Dispatch 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.
Performa invoice: The first document in many cases Performa invoice gives the buyer all the information about the item, price, delivery, payment terms, etc.
Export order/purchase order: Based on the Performa invoice, the buyer places the order with the exporter, specifying their details and requirements in the purchase order.
Packing list: If there is more than one item to be exported, a packing list, listing the various items to be shipped, is mandatory.
Labeling: Primarily, labeling is the technique of identifying the cargo during the operation till the cargo touches the importer’s doorstep. The label on the consignment also gives information about how the package or product should be used. (Read more. Click Labeling)
Certificate of origin: A certificate of origin is a notarised affidavit that indicates the place where the goods are manufactured.
Inspection or quality check: An importer may insist on inspection or QC of the goods before shipping to verify the quality as well as check for adherence to proper packing perimeters.
• Consular Invoice – Mainly needed for the countries like Kenya, Uganda, Tanzania, Mauritius, New Zealand, Burma, Iraq, Australia, 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.
• 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 the entry of goods into the importing country at a preferential tariff rate.
• Legalised /Visaed Invoice – This shows the seller’s genuineness before the appropriate consulate or chamber of 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 a specific contract. Sight Draft and Usance Draft are available for this. A 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.
• Export Packing List – An export packing list is much more detailed and informative than a standard domestic packing list. It includes:
– Itemisation of the contents of each individual package
– The type of package, such as a box, crate, drum, or carton
– The individual net, legal, tare, and gross weights and measurements for each package
• Shipper’s and buyer’s references: The list is used by the shipper or forwarding agent to determine the total shipment weight and volume, and whether the correct cargo is being shipped.
• Certificate of Inspection – It is a type of document describing the condition of goods and confirming that they have been inspected. An inspection certificate is often required by foreign customs or businesses for certain regulated products. These are typically related to agriculture, health, or the environment. Inspection certificates also may be required to ensure that vessels or crates are free of contaminants before entering certain ports, or that the products met the specifications outlined in a contract or purchase order.
• Black List Certificate – It is required for countries that have strained political relations. 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 a few countries to show that the goods shipped have actually been manufactured and are 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 with humidity factor, dry weight, etc.
• Antiquity Measurement – It is issued by the Archaeological Survey of India in the case of antiques.
• Shipping Order – Issued by the Shipping (Conference) Line which intimates the exporter about the reservation of space for 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 that are shut out by a ship and is prepared by the concerned shed and sent to the exporter.
• Insurance Certificate: An insurance certificate is used to assure the consignee that insurance will cover the loss of, or damage to, the cargo during transit. Typically, marine insurance coverage equal to 110% of the commercial invoice amount must be obtained for export shipments. If the exporter plans to export infrequently, he may be able to buy insurance through his freight forwarder.
• Short Shipment Form – It is an application to the customs authorities at the port that advises short shipment of goods and is required for claiming the return.
Besides these, documents such as phytosanitary certificates and fumigation certificates are required to show conformity with international quality, standards, and procedures. Other necessary paperwork includes export order/purchase order; letter of credit; inspection/quality check certificate; marine insurance policy; health certificate (applicable only when exporting food products that are of animal or non-animal origin); certificate of insurance; warehouse receipt and bill of entry.
Do note that the above-stated documents are required in specific cases/products/tariff lines only and are not mandatory for all products. The exact document requirements may evolve over time depending upon prevalent statutes/ amendments related to our country and that of exporting/importing countries with any specific requirement related to the export sector.
The bankers are required to handle import bills carefully as there were several instances of remittances made by the banks on behalf of unscrupulous persons who have submitted fake import bills for the purpose of siphoning out the country’s foreign exchange. (To know more, Click: handling import bills in banks.)