EXPORT DOCUMENTATION

AGENCIES CONNECTED WITH EXPORTS

Director General of Foreign Trade
-

Formulation of trade policy; allotment of importer-exporter code number

Customs
-

Valuation of goods, physical aspects of exports

Reserve Bank of India & Authorized Dealers

- Monitoring receipts of payments & follow up

CATEGORIES OF EXPORTS
Cash Exports Deferred Payment Exports/ Deemed exports Project Exports Software Exports Services Exports

DECLARATION OF EXPORTS

Mandatory to declare the export of goods & Services outside India (except Nepal & Bhutan) by exporter to the specified authority in the prescribed forms (Regulation 3)

Full value of goods or software Where value not ascertainable the value expected to be realized given the market conditions

Export of services no form prescribed however liable to repatriate the exchange so earned

EXPORT DOCUMENTATION IN INDIA

Export documentation in India has evolved a great deal particularly since 1990. Prior to 1990, the documentation was all manual and not at all coordinated. The result was lot of delays and mistakes, rendering the task very clumsy, tiresome, repetitive and truly frustrating.

EXPORT DOCUMENTATION IN INDIA

India adopted the ADS in 1991. ADS refers to Aligned Documentation System. It is the internationally accepted documentation system. ADS uses a Master Document that contains the information common to all documents forming part of the aligned series.

EXPORT DOCUMENTATION
There are a number of documents, which have to be prepared by the exporter in order to arrange export of his consignments.
These documents can be mainly classified into two i.e. (a) Commercial Documents and

(b) Regulatory Documents

EXPORT DOCUMENTATION
Export Documents
Commercial Documents Principal Auxiliary Regulatory Documents

EXPORT DOCUMENTATION
Out of the 15 commercial documents, eight are principal and the rest are auxiliary. The eight principal documents are 1. The Commercial Invoice,
2. Packing List 3. Bill of Lading/Air Waybill 4. Certificate of Inspection/Quality control 5. Certificate of origin 6. Bill of Exchange and 7. Shipment Advice 8. Insurance Certificate

EXPORT DOCUMENTATION

The seven auxiliary documents are

1. Proforma Invoice 2. Intimation for inspection 3. Shipping instructions 4. Insurance Declaration

5. Application for certificate of origin.

6. Mate's Receipt 7. Letter to bank of collection/negotiation of documents

EXPORT DOCUMENTATION

Regulatory Documents There are seven regulatory documents associated with the pre-shipment stage of the export transaction. They are: 1. ARE Form ( for Central Excise) 2. Shipping Bill/Bill of Export (for Customs) - For export of goods Ex. Bond - For export of duty free goods - For export of dutiable goods - For export of goods under claim of drawback - For export of goods under claim of DEPB

EXPORT DOCUMENTATION

3. Port Trust Copy of Shipping Bill/

Export Application/Dock Challan 4. Vehicle ticket 6. Freight Payment Certificate - Steamer Agents - Insurance Co. Port Port

5. Exchange Control Declaration/GR/PP forms 7. Insurance Premium Payment Certificate

RBI

Commercial Documents
Document Functions
Prepared by

Quotation An offer to sell goods and should Exporter state clearly the price, details of quality, quantity, trade terms, delivery terms, and payment terms.

Sales Contract

An agreement between the buyer and the seller stipulating every details of the transaction. It is a legally binding document. It is therefore advisable to seek legal advice before signing the contract.

Exporter and Importer

Principal Commercial Documents

Document Functions
Prepared by

Commercial It is a formal demand note for Exporter Invoice payment issued by the exporter to the importer for the full realizable amount for goods sold under a sales contract. It should give details of the goods sold, payment terms and trade terms. It is also used for the customs clearance of goods and sometimes for foreign exchange purpose by the importer.

Commercial Documents
Document Bill of Lading Functions
Prepared by

Is a document given by the Shipping shipping agency for the goods agency. shipped for transportation from one destination to another and is signed by the representatives of the carrying vessel. An evidence of contract between the shipper of the goods and the carrier. The customer usually needs the original as proof of ownership to take possession of the goods.

Commercial Documents
Document Airway Bill Functions
Prepared by

Air Waybills make sure that goods Airport have been received for shipment authority by air. personnel. Air Waybills serves as:

Proof of receipt of the goods for shipment. An invoice for the freight. A certificate of insurance. A guide to airline staff for the handling, dispatch and delivery of the consignment.

Commercial Documents
Document Combined Transport Document Functions
Prepared by

Combined Transport Document is also known as Multimodal Transport multimodal Document, and is used when goods transport are transported using more than operator one mode of transportation. In the case of multimodal transport document, the contract of carriage is meant for a combined transport from the place of shipping to the place of delivery.

Commercial Documents
Document Packing List Functions
Prepared by

A list with detailed packing information of the goods shipped. Provides information for transportation purpose, such as details of invoice, buyer, consignee, country of origin, vessel/flight date, port/airport of loading, port/airport of discharge, place of delivery, shipping marks / container number, weight / volume of merchandise and the fullest details of the goods, including packing information. Inspection A report issued by an independent Certificate surveyor (inspection company) or the exporter on the specifications of the shipment, including quality, quantity, and/or price, etc; required by certain buyer and countries.

Exporter

Inspection Company or Exporter

Commercial Documents
Document Insurance Policy/ Certificate Functions
An insurance policy is an insurance document evidencing insurance has been taken out on the goods shipped, and it gives full details of the insurance coverage. An insurance certificate certifies that the shipment has been insured under a given open policy and is to cover loss of or damage to the cargo while in transit. The exporter sends this document to importer soon after shipment of goods to provide him all the shipment details. Serves as advance intimation to importer and allows him to arrange for the delivery. Prepared by

Insurer or Insurance Agent or Insurance Broker

Shipment Advice

Exporter

Commercial Documents
Document Functions
Prepared by

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

Commercial Documents
Document Bill of Exchange ( Draft) Functions Prepared by

A Bill of Exchange is a special type of written Exporter document under which an exporter ask importer a certain amount of money in future and the importer also agrees to pay the exporter that amount of money on or before the future date. This document has special importance in wholesale trade where large amount of money involved. Following persons are involved in a bill of exchange: Drawer: The person who writes or prepares the bill. Drawee: The person who pays the bill. Payee: The person to whom the payment is to be made. Holder of the Bill: The person who is in possession of the bill.

Commercial Documents
Document Functions Prepared by

Consular A document required by some foreign Exporter Invoice countries( Mainly needed for the countries like Kenya, Uganda, Tanzania, Mauritius, New Zealand, Burma, Iraq, Australia, Fiji, Cyprus, Nigeria, Ghana, Zanzibar etc.) showing shipment information such as consignor, consignee, and value description, etc. Certified by a consular official of the importing country stationed in the foreign country, it is used by the country's customs officials to verify the value, quantity and nature of the shipment.

Auxiliary Commercial Documents

Document Functions
Prepared by

Pro Forma Invoice

An invoice provided by a supplier prior to the Exporter shipment of merchandise, informing the buyer of the kinds and quantities of goods to be sent, their value, and importation specifications (weight, size and similar characteristics).

Shipping Order/ Reservation slip issued by shipping company Shipping Carting to exporters/ agents request for booking of company Order(Air) shipping space for shipment.

Auxiliary Commercial Documents

Document Functions
Prepared by

Dock/ Mates Receipt

A receipt to confirm the receipt of cargo on Master of quay/warehouse pending shipment. The dock the ship receipt is used as documentation to prepare a bill of lading. It has no legal role regarding processing financial settlement.

SHIPPING BILL- REGULATORY DOCUMENT

Shipping Bill is an important document required to seek permission of customs to export goods by Sea/Air. It is prepared by the exporter and submitted to the Customs. The exporter of any goods has to file a SHIPPING BILL as an entry for the purpose of export by air or sea and a BILL OF EXPORT in respect of export by land. Cargo will be allowed to be carted to Dock/Port sheds only after stamping and passing of the shipping bill by customs authorities. The exporter has to sign a declaration in the Shipping Bill regarding the truth of its contents.

SHIPPING BILL

Shipping Bill normally contains:

the

name and address of the importer/consignee and exporter, invoice number and date, name of vessel carrying the goods, name of master or agents, port at which goods are to be discharged, country of final destination, description of goods, quantity details of each case, value of the goods as defined in the Sea Customs Act, number of packages with total weight, marks and numbers, etc.

SHIPPING BILL

Types of Shipping Bills:

FREE SHIPPING BILL: Used for export of goods which neither attract any Export duty/cess nor entitled to any Duty Drawback DUTIABLE SHIPPING BILL: Used when export goods are subject to Export Duty/Cess. Duty is charged either on quantity basis (Fixed amount per kg. or per Metric tonne) or on certain percentage of assessable value. DRAWBACK SHIPPING BILL: Used when Duty Drawback is to be claimed.

SHIPPING BILL- REGULATORY DOCUMENT

Shipping bill is required to be submitted in quadruplicate. If Drawback/DEPB claim is to be made, one additional copy should be submitted. Copies of Shipping Bill are as under:

Customs Copy: For record of Customs Exporters Copy: For record of Exporters/ Exporter may forward it to shipping company. Export Promotion Copy: For office of DGFT. This copy is the most important document for claiming duty Neutralisation/Exemption benefits plus export incentives wherever applicable. Exchange Control Copy: For negotiating the export documents in bank. It is Proof of export for exchange purposes. DEPB Copy: For use in the import cell of customs for registration of licence.

ARE- REGULATORY DOCUMENTS

ARE stands for application for removal of excisable goods for exports by Air/Sea/ Post/Land. Goods which are sold overseas are exempted from payment of excise duty or entitled for Rebate of Excise Duty, if excise paid goods are exported. Under both these circumstances, the document to be used is ARE. When goods are removed without payment of duty for the purpose of export, they will get covered under the provisions of Rule 19 of the Central Excise Rules.

ARE

When excise paid goods are exported and rebate of Excise Duty is to be claimed, they will get covered under Rule 18 of Central Excise Rules. ARE is prepared before clearance of goods from the factory gate. ARE will specify whether goods are exported under Rule 19 or under Rule 18.

MATE RECEIPT

Mates receipt is a receipt issued by the Master or Mate of the vessel stating that certain goods have been received on board his vessel. It is prima-facie evidence that the goods are loaded in the vessel. It contains: the name of shipping line and vessel, port of loading, port of discharge and place of delivery, marks and numbers, number and kind of packages, gross weight, description of goods, container status/seal number, shipping bill number and date and condition of cargo at the time of its receipt on board the vessel. It is serially numbered.

MATE RECEIPT

Port authorities recover port dues from exporter on production of this receipt. On payment of Dock dues, the exporter or his agent collects the receipt from the Port-Trust authorities and hands over to shipping company for preparing Bill of Lading.

Bill of Lading is prepared on the basis of Mates Receipt.

It is of a transferable nature. In case of ascertaining the exact date of shipment, the mates receipt date is also very important. Normally, the date of Export is regarded as the date of Mate Receipt or the date of Bill of Lading, whichever is later.

EXPORT DECLARATION FORMS (GR/SDF)

As per the exchange regulations, exporters, wishing to ship goods abroad, are required to submit Export Declaration Forms to the Customs authorities (whenever the value of the shipment exceeds US $ 25,000) before any export of goods from India is made. It is to be filed by exporter stating that export proceeds would be realized within 180 days for non-status holder exporters and 360 days for status holder exporters.

EXPORT DECLARATION FORMS (GR/SDF)

Relevant Declaration Forms, as prescribed by RBI under Foreign Exchange Management (Export of Goods and Services) Regulations, 2000.
GR Form : Used for exports to all countries made other than by post including export of software in physical form i.e. magnetic tapes/discs and paper media - When S/B is filed manually. [prepared in duplicate] : Appended to the shipping bill, for exports declared to Customs Offices notified by the Central Government which have introduced Electronic Data Interchange (EDI) system for processing shipping bills notified by the Central Government. [prepared in duplicate]

SDF Form

REGULATORY DOCS- EXPORT DECLARATION FORMS (GR/SDF)

These forms normally contain:

Name and address of exporter, IEC code number and description of goods. Name and address of authorised dealer through whom the proceeds of the exports have been, or will be, realised. Details of commission due to foreign agent or buyer should be correctly declared. Otherwise, difficulties may arise at the time of remittances of such commission/ payment. An exporter should note this point very carefully. It should be clearly indicated whether the export is on Outright Sale Basis or On Consignment Basis An exporter is required to give analysis of full export value, a break-up of FOB value, freight, insurance, discount, commission, etc. An exporter has to mention the period within which he will realise full export value of transaction. If the shipment is on DA terms, then an exporter has to bring forex within that period. However, normally maximum period allowed is 180 days.

STATUTORY DECLARATION FORM [SDF]

Procedure for Distribution / disposal of copies of SDF

The SDF form should be submitted in duplicate (to be annexed to the relative shipping bill) to the Commissioner of Customs concerned. After verifying and authenticating the declaration in form SDF, the Commissioner of Customs will hand over to the exporter, one copy of the shipping bill marked Exchange Control Copy in which form SDF has been appended for being submitted to the bank within 21 days from the date of export.

STATUTORY DECLARATION FORM [SDF]

Banks should accept the Exchange Control (EC) copy of the shipping bill and form SDF appended thereto, submitted by the exporter for collection/negotiation of shipping documents.

The manner of disposal of EC copy of shipping Bill (and form SDF appended thereto) is the same as that for GR forms.

AFTER SHIPMENT, SUBMIT DOCUMENTS TO BANK FOR REALISING EXPORT PROCEEDS