Import and export transactions are heavily reliant on documentation. Documents that are incorrectly organized or missing can cause immeasurable distress for all the stakeholders. The importer or exporter cannot surrender or acquire their shipment if the office work has not been completed. There may even be a penalty and a setback in their credibility.
Topics we'll discuss include:
How the authorities reduce documentation for export-import
In order to export products via sea, exporters need three key documents
In order to import products that are arriving via sea, importers need three key documents
Additionally, you may find our blog post on which shipping documents are necessary for clearance of customs of interest.
What the authorities can do to reduce export-import documentation.
A brief description of import-export documentation in India and current government guidelines follows.
Before five years ago, exporters and importers were required to prepare seven to eight mandatory documents - plus any additional documentation that may be required, depending on the type of products shipped or country-specific regulations and guidelines. It was a tedious and expensive procedure as a result. It was also cited as a factor in India's poor performance at the World Bank's Ease of Doing Business Index. India was ranked 142 of 189 nations in 2014 (it has since climbed to 63 out of 189). To reduce the amount of paperwork required in imports and exports, the Department of Commerce established an Inter-Ministerial Committee in the same year. The mission was to improve the export-import process and India's ranking in the Ease of Doing Business and double exports to $900 billion by 2020. Import and export documents should be reduced to three each for imports and exports, according to the committee.
All suggestions have been approved. In a notification issued by the Directorate General of Foreign Trade (DGFT), a department of the Ministry of Commerce and Industry that formulates and implements India's Foreign Trade Policy, the modifications were announced. The following are the 3 key documents for exports and imports under the revised Foreign Trade Policy, which took effect in April 2015.
Must-have Shipping Documents for Exports
Bill of Lading
Exporters' most important shipping document. It is a mandatory document that must be signed by three parties: the exporter, the shipping line, and the importer. An exporter needs a complete set of bills of lading from the shipping line/freight forwarder and dispatch it to the importer/importer's bank for easy transportation.
Information on this bill of lading includes:
Description, amount, weight of products
Name and address of consignee
Terms of sale
2.Commercial Invoice cum Packing List
An exporter issues this payment invoice to an importer as a settlement of the sale. Based on the purchase price, they can determine the responsibilities and taxes due on the products.
Among the information it contains are:
Name, address of seller (exporter)
Name, address of buyer (importer)
Value, amount of products
{An itemized packing list contains information about the products.|In a packing list, product information is listed item by item.|An itemized packing list contains information about the products.] At the point of clearance, it simplifies their exam and corrects tallying.
It contains:
Description of the products
Quantity and weight (gross and net) of the products
Number of packages
Type of packaging (PP,Jute, BOP , Laminated etc)
Marks and numbers (symbols/numbers positioned on every piece of shipment in a cargo to discover them)
Carrier’s (ship) name
Date of export
Export licence number
Letter of credit score number
Previously, the economic bill and packing list were separate files with the same fields.
3. Bill of Entry
An export bill or shipping bill is a type of customs clearance application that is submitted by the exporter. Customs use this information to determine whether a company has benefited from government incentives, such as:
Various tax exemptions, rebates, and refunds
Export benefits under various government programs
Documents needed for imports
Bill of Lading
This is a must-have document for both exporters and importers. The exporter and importer must share the bill of lading. Bills of lading are required for importation at the importer's end.
2. Commercial Invoice cum Packing List
It is also necessary for the importer to have this document. For the most part, customs clearance depends on the commercial invoice cum packing list.
3. Bill of Entry
The final requirement for importers is a bill of entry. At the port of entry, customs authorities inspect and clear goods based on a declaration from the importer. The information in this bill matches an insurance policy or sales invoice.
Included in this information are:
Type of cargo
Value of the goods
Quantity of the goods
This was a quick overview of the three documents that importers and exporters should always have on hand. It does not mean that these are the only documents required. It's here all about paperwork in the shipping process. For their goods to be processed at customs, importers and exporters may need to submit additional supporting documentation, depending on various factors and case-by-case.