aligneddocumentationsystem-090430071326-phpapp02

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Aligned Documentation System

Under Aligned DocumentationSystem, different forms used in the

International trade transaction areprinted on the paper of the same sizeand in such way that the commonitems of information are given the

same relative slots in each of thedocuments.


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ADS has been classified as under:

Commercial Documents: Commercial documents arerequired for effecting physical transfer of goods and their titlefrom the exporter to the importer and the realization of exportsale proceeds.

Out of 16 commercial documents 14 have been standardizedand aligned to one another.

They are Proforma Invoice, commercial invoice, packing list,shipping instructions, intimation for inspection, certificate ofinspection of quality control, insurance declaration, certificateof insurance, mates receipt, bill of lading or combinedtransport document, application for certificate origin,certificate of origin, shipment advice and letter to the bank forcollection or negotiation of documents.


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Regulatory Documents: Regulatory pre-shipment exports documents

are prescribed the different government departments and bodies in order to

comply with various rules and regulations under the relevant laws

governing export trade.

Such as export inspection, foreign exchange regulation, export trade

control, customs, etc.

Out of 9 regulatory documents 4 have been standardized and aligned.

These are shipping bills or bill of export, exchange control declaration (GR

Form), export application dock challan or port trust copy of shipping bill

and receipt for payment of port charges.


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Proforma Invoice

The starting point of the export contract is in the form of offer

made by the exporter to the foreign customer. The offer made by

the exporter is in the form of proforma invoice. It is a quotation

given as a reply to an inquiry.

Importance:1. It forms the basis of all trade transactions.

2. It may be useful for the importer in obtaining import license or

foreign exchange.


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Commercial Invoice

Commercial invoice is an important and basic export document. It is alsoknown as Documents of contents as it contains all the informationrequired for the preparation of the other documents.

It is prepare by the exporter after the execution of export order givingdetails about the goods shipped. It is essential that the invoice is prepared

in the name of the buyer or the consignee mentioned in the letter of credit. It is a prima facie evidence of the contract of sale or purchase and

therefore, must be prepared strictly in accordance with contract of sale.

Importance:

1. It is the basic document useful in preparation of various other shippingdocuments.

2. It is used in various export formalities such as quality and pre-shipmentinspection, excise and customs procedure, etc.

3. It is also useful in negotiation of documents for collection and claim ofincentives.

4. It is useful for accounting purposes to both exporters as well as importers.


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Packing List

The exporter prepares the packing list to facilitate the buyer to check the

shipment. It contains the detailed description of the goods packed in each

case, their gross and net weight, etc.

The difference between a packing note and a packing list is that the packing

note contains the particulars of the contents of an individual pack, while thepacking list is a consolidated statement of the contents of a number of cases

or packs.

Normally, 10 copies of the packing note/list should be prepared. The first is

to be sent with the shipping documents, two copies in advance to the buyer,

one to the shipping agent and remaining retained by the exporter.


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Mates Receipt

Mates receipt is a receipt issued by the commanding officer of theship when the cargo is loaded on the ship. The mates receipt is aprima facie evidence that goods are loaded in the vessel. The matesreceipt is first handed over to the port trust authorities.

After making payments of all dues, the exporter or his agent collects

the mates receipt from the port trust authorities. The mates receipt is freely transferable.

Bill of lading is prepared on the basis of mates receipt.

Types ofMates Receipt:

1. Clean Mates Receipt: The commanding officer of the ship issues theclean mates receipt, if he is satisfied that the goods are packed

properly and there is no defect in the packing of the cargo or package.2. Qualified Mates Receipt: The commanding officer of the ship issues a

qualified mates receipt, when the goods are not packed properly andthe shipping company does not take any responsibility of damage tothe goods during transit.


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Importance:

1. It is an acknowledgement of goodsreceived for export on board the ship.

2. It is a transferable document. It must behanded over to the shipping company in

order to get the bill of lading.

3. Bill of Lading, which is the title of goods,is prepared on the basis of the mates

receipt.

4. It enables the exporter to clear port trustdues to the Port Trust Authorities.


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Bill of Lading

Bill of Lading is a document issued by the shippingcompany or its agent acknowledging the receipts ofgoods on board of vessel, and undertaking to deliver ofgoods in the like order and condition as received, to the

consignee or his order, provided the freight and othercharges as specified in the bill have been duly paid.

It is freely transferable by endorsement and delivery.

A bill of lading serves three main purposes:

1.

As a document of title to the goods;2. As a receipt from the shipping company; and

3. As a contract for the transportation of goods.


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Types ofBill of Lading:

1. Clean Bill of Lading: A bill of lading acknowledging receipt of thegoods apparently in good order and condition and without anyqualification is termed as clean bill of lading.

2. Claused Bill of Lading: A bill of lading qualified with certain adverseremarks such as, goods insufficiently packed in accordance with the

carriage of goods by Sea Act, is termed as a claused bill of lading.3. Transhipment or Through Bill of Lading: When the carrier uses other

transport facilities, such as rail, road or another steamship company inaddition to his own, the carrier issues a through or transhipment bill oflading.

4. Stale Bill of Lading: A bill of lading that has been held too long before itis passed on to a bank for negotiation or to the consignee is called a stalebill of lading.

5. Freight paid Bill of Lading: When freight is paid at the time of shipmentor in advance, the bill of lading is marked, freight paid.

6. Freight Collect Bill of Lading: When the freight is not paid and is to becollected from the consignee on the arrival of the goods, the bill oflading is marked, freight collect and is known as freight collect bill of

lading.


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Importance (for exporters)

1. It is the contract between the shipper and the shippingcompany for the carriage of goods to the port ofdestination.

2. It is an acknowledgement indicating that the goods

mentioned in the document have been received onboard for the purpose of shipment.

3. A clean bill of lading certifies that the goods receivedon board the ship are in order and good condition.

4. It is useful in claiming incentives offered by thegovernment to exporters.

5. The exporters can claim damages from the shippingcompany if the goods are lost or damaged after theissue of a clean bill of lading.


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Importance (Importers)

1. It acts as document of title to goods, which is transferable byendorsement and delivery.

2. The exporter sends the bill of lading to the bank of the importer so asto enable him to take the delivery of goods.

3. The exporter can give an advance intimation to the foreign buyer

about the shipment of goods by sending him a non-negotiable copyof bill of lading.

Importance (For Shipping Company)It is useful to the shipping company for collection of transport

charges from the importer, if not collected from the exporter.


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Certificate of Origin

The importers in several countries requires acertificate of origin without which clearance toimport is refused. The certificate of origin statesthat the goods exported are originally

manufactured in the country whose name ismentioned in the certificate.Certificate of originis required when:-

a. The goods produced in a particular country are

subject to preferential tariff rates in the foreignmarket at the time of importation.

b. The goods produced in a particular country arebanned for the import in the foreign market.


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Types ofCertificate of Origin

(a) Non-Preferential Certificate of Origin: Non-preferential certificate oforigin is required in general by all countries for clearance of goods bythe importer, on which no preferential tariff is given. It is issued by:-

The authorized Chamber ofCommerce of the exporting country.

Trade Association of the exporting country.

(b) Certificate of origin for availing concessions under GSP: Certificate oforigin required for availing of concessions under Generalized System ofPreferences (GSP) extended by certain countries such as France,Germany, Italy, BENELUX countries, UK, Australia, Japan, USA, etc.This certificate can be obtained from specialised agencies, namely-

Export Inspection agencies.

Jt. Director General of foreign trade. Commodity boards and their regional office.

Development Commissioner, Handicrafts.

Textile committes for textile products.

Marine Product Export Development Authority for marine products.

Development Commissioner ofEPZs.


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Significance of the Certificate of

Origin1. Certificate of origin is required for availing ofconcessions under Generalized System ofPreferences (GSP) as well as underCommonwealthPreferences (CWP).

2.It is to be submitted to the customs for the assessmentof duty and clearance of goods with concessionalduties.

3. It is required when the goods produced in a particularcountry are banned for import in the foreign market.

4. It helps the buyer in adhering to the import regulationsof the country.

5. Sometimes, in order to ensure thats good bought fromsome other country have not been reshipped by aseller, a certificate of origin is required.


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Shipping Bill

Shipping Bill is the main customs document, required by the customsauthorities for granting permission for the shipment of goods. The cargois moved inside the dock area only after the shipping bill is dulystamped, i.e., certified by the customs. Shipping bill is normallyprepared in five copies:

1.C

ustoms copy.2. Drawback copy.

3. Export promotion copy.

4. Port trust copy.

5. Exporters copy.

Types of Shipping Bill:-1. Drawback Shipping bill: It is useful for claiming the customs drawback

against goods exported.

2. Dutiable Shipping Bill: This bill is required for goods which are subjectto export duty.

3. Duty-free ShippingB

ill: It is useful for exporting the goods on whichthere is no export duty.


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Importance of Shipping Bill

1. Shipping bill is the main customs document,required by the customs authorities forgranting permission for the shipment of goods.

2. The cargo is moved inside the dock area onlyafter the shipping bill is duty stamped, i.e.,certified by the customs.

3. Duly endorsed shipping bill is also necessaryfor the collection of export incentives offered

by the government.4. It is useful to the customs Appraiser while

determining the actual value of goodsexpoerted.


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Consular Invoice This is invoice is the most important document, which needs to

be submitted for certification to the embassy of the importingcountry concerned. The main purpose of the consular invoiceis to enable the authorities of the importing country to collectaccurate information about the volume, value, quality, grade,

source, etc., of the goods imported for the purpose of assessingimport duties and also for statistical purposes.

In order to obtain consular invoice, the exporter is required tosubmit three copies of invoice to the consulate of theimporting country concerned. The Consulate of the importing

country certifies them in return for fees. One copy of theinvoice is given to the exporter while the other two aredispatched to the customs office of the importers country forthe calculation of the import duty. The exporter negotiates acopy of the consular invoice to the importer alongwith other

shipping documents.


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Bill of Entry Bill of entry is a document, which states that the goods of the stated

values and description in the specified quantity have entered into thecountry from abroad. The bill of entry is drawn in triplicate.

The customs authorities may ask the importer to supply other documentslike invoice, brokers note and insurance policy, etc. in order to verify thecorrectness of the information supplied in the bill of entry form.

1. Free goods:- where the goods imported are not subject to any customsduty.

2. Goods for Home Consumption:- Where the goods imported for selfconsumption.

3. Bonded Goods:- Where the goods imported are subjects to customs duty,the goods are kept in bond till the duty is paid.

The importer has to fill up a separate bill of entry form for different formfor different classes of goods. In India, separate forms are not used but allthe entries are made in one form. The free goods are marked as free in theentry form itself. The importer has to pay the duty before securing thepossessions of the goods.


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Airway Bill

Airway bill, also called as an air consignment note, is a receipt issued byan airline for the carriage of goods. As each shipping company has its ownbill of lading, so each airline has its own airway bill.

Airway bill or air consignment note is not treated as a document of titleand is not issued in negotiable form.

Importance:-

1. It is contract between the airlines or his agent to carry goods to thedestination.

2. It is the document of instructions for the airline handling staff.

3. It acts as a customs declaration form.

4. Since, it contains details about freight it also represents freight bill.


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GR Form GRform is an exchange control document required by the reserve bank of

India. As per the exchange control regulations, an exporter has to realizethe proceeds of the goods he has exported within 180 days of theirshipment from India.

GRform is to be submitted in duplicate to the Customs at the port ofshipment along with shipping bill. Customs will give their running serialnumber on both the copies after admitting the customs shipping bill.

Customs authorities will certify the value declared by the exporter on boththe copies of the GRform at the space earmarked and will also record theassessed value. They will then return the duplicate copy of the form to theexporter and retain the original for transmission to the RBI. Within 21 daysfrom the shipments of goods, exporter must lodge the duplicate of GRtogether with relative shipping documents with the authorized dealernamed in the GRform for negotiation of export bills.

After the documents have been negotiated, the authorized dealer will reportthe transaction to the RBI. The duplicate copy of GRform together with acopy of invoice will be retained by the authorized dealer till full exportsproceeds have been realized and thereafter submitted to the RBI.

On account of introduction ofElectronic Data Interchange (EDI) system acertain customs offices were shipping bills are processed electronically, theexisting declaration in GRform has been replaced by a declaration in formSDF (Statutory Declaration Form).


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Mates receipt v/s bill of lading1. Meaning:- Mates receipt is a

receipt issued by thecommanding officer of the shipwhen the cargo is loaded on theship.

2. Purpose:- It is issued in order to

enable the exporter or his agentto secure bill of lading from theshipping company.

3. Issuing Authority:- It is issuedby the Commanding officer ofthe ship or his mate.

4. Evidence:- It is an evidence ofgoods having been loaded onboard the ship.

1. Meaning:- Bill of lading is theofficial document issued by theshipping company acknowledgingthe receipt of goods on board thevessel.

2. Purpose:- It is issued in order to

enable the importer to take thedelivery of goods at the port ofdestination.

3. Issuing authority:- It is issued bythe shipping company or its agent.

4. Evidence:- It is a contract

between the shipper and theshipping company for the carriageof goods to port of destination.


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5. Types:- It is of two types-

(a) Clean Mates Receipt

(b) Qualified Mates Receipt.

6. Details of Freight:- It does

not specify whether the

freight is paid on goods or

not.7. Title of goods:- It is not a

document of title of goods.

8. Negotiability:- It is not a

negotiable document.

9. Sequence:- It is prepared

before the bill of lading.

5. Types:- Several types-

(a) Clean and claused B/L.

(b) Stale B/L.

6. Details of Freight:- It does

specify whether bill of

lading is freight paid or not.

7. Title of goods:- It is a

document of title of goods.

8. Negotiability:- It is a

negotiable instrument.9.Sequence:- It is prepared on

the basis of the mates

receipt.


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Certificate of Origin v/s Consular

Invoice1. Meaning:- Certificate of origin

states that the goods exportedare originally manufactured inthe country whose name ismentioned in the certificate.

2. Purpose:-

(a) for claiming the benefits ofpreferential tariff rates.

(b) in case goods produced in aparticular country are bannedfor import in the foreign market.

3. Legislation:- It does not require

any legislation from theconsulate of the importingcountry situated in the exportingcountry.

4. Issuing Authority:- It is issuedby the Chamber ofCommerce,Export Promotion Councils or

Authorized Trade association.

1. It is a certificate issued by theconsulate of importers countrysituated in the exporters countrycertifying the volume, value,quality, etc., of the goodsimported.

2. Consular invoice is required in

order to provide accurateinformation about the volume,value, quality, etc., of the goodsimported to the authorities of theimporting country for the purposeof assessing import duties.

3. It does requires legislation from

the Consulate of the importingcountry situated in the exportingcountry.

4. It is issued only by the Consulateof the importers country situated

in the exporters country.


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Commercial Invoice v/s Consular

Invoice1. Meaning:- Commercial Invoice

is the statement of account ofsale prepared by the exporterafter the execution of exportorder giving details about thegoods shipped.

2. Purpose:-

In preparation of variousshipping documents.

In Pre-shipment inspection,excise and customs clearance.

In negotiation of documents forcollection and claim ofincentives.

1. Consular invoices is a certificateissued by the Consulate of theimporters country situated in theexporters country certifying thevolume, value, quality, grade,sources, etc., of the goodsimported.

2. It is required in order to provideaccurate information about thevolume, quality, grade, value,source, etc., of the goods importedto the authorities of the importing

country for the purpose ofassessing import duties.


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3. Significance:- It is a

primary document and isrequired for the preparationof various other shippingdocuments.

4. Contents:- It contains theterms and conditions of saleas well as detaileddescription of the goods to

be exported.

5. Cost:- since, it is preparedby the exporter himself heneeds not to pay any chargesfor the same.

3. It is a secondary

document and as such isrequired when desired bythe importer.

4.It contains accurateinformation about thevolume, value, quality,grade, source, etc., of thegoods exported.

5.It is issued by theConsulate of theimporting country inreturn for a nominal fees.