TRADE DOCUMENTATION

There are several types of trade document that involve when making a transaction. For each document is different with another and have their own functions.. These document are importance for importers and exporters that is to ensure all activity during export and import.

Main purpose of trade documentations:

·         To fulfil the regulation

·         The most common reason.

·         E.g.: warranty. If the goods are broken and we don’t have a warranty we cannot claim anything.

·         Manage risk

·         Who will responsibility if something happen

·         Seller and buyer will know their responsibility

·         Common understanding

·         Need understand for the language in term of documentation

·         Easy to communicate

·         Record keeping

·         Important for the business audit at the end year

·         If there a something happen the company can refer within the documentation

There are several types of document:

·         Transportation document

·         Used for movement of the cargo from one point to another point. Required for deliver the goods.

·         Banking document

·         Invoice will be released by seller if buyer buys the goods on credit.

·         Commercial document

–         Happen between seller and buyer. E.g.: Quotation or pro forma invoice will sent by the seller to the buyer (price, delivery cost, insurance) and the buyers will reply with document purchase order (PO).

·         Government documents

·         Necessary to custom clearation. This document also not fulfil the government regulation. Ata carnet are needed for bring the goods that not intended for sale but only for the sample. No need to pay for tax. E.g.: food products.

There are a list of documents often used in international trade:

1.       Air Waybills

Closely related to the BL, a waybill does not convey title. It used to be mostly for air cargo, but ocean carriers are using it more. The document will submitted to shipper when the goods already in ship.

  

2.       Bill of Lading (B/L)

The most important document in the entire process, this is a document title, a receipt of goods, and a contract of carriage. Lorry will be in port for brought the container through agent. When the goods are fine the container can get in the boat and that is where the bill of lading occur. Signed by the agent to express goods already received on ship, contract of carriage for bring the goods to bill of charge.

Types Bill of Lading

·         Clear Bill of Lading -  if there is stain on the form, the form is not to be used again.

·         On board Bill of Lading -  it will sign when goods already in the ship.

·         Received- for-shipment Bill of Lading – already sign the document but goods no on the ship. Only be accepted by the carrier

·         Straight Bill of Lading – no change if the document are submitted to consignee. Goods will be accepted to nominee in the document

·         Forwarder’s Bill of Lading – This document released by forwarder. Acted as the middle man. Shipper can released the document but cannot revealed the goods.

3.       Certificate of Origin

A  certificate, typically provided by the government of the exporter, certifying the nationality of the cargo. Want to know the place of origin of goods. Can get tax exemption which is the document must released from the place of origin of goods to get a tax duty import and sales tax.

4.       Purchase order

The contract between buyer and seller includes the agreed form of sale.

5.       Pro forma 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 a pro forma invoice. It is a quotation given as a reply to an inquiry. It normally forms the basic of all trade transactions. (will be charge when debt)

6.       Sanitry certificate

Usually use for the food shipments to certify that it is hygienic. It also was known as a phyto-sanitary certificate.

7.       Carnet

This is for the permission of sample goods to enter without paying duties for the regular cargo.

8.       Export Declaration

The form must be submit to the government by the exporter for provide a basic information about the cargo.

9.       Packing List

Has been shown on invoice or maybe via separately. Should contain item by item, the contents of cases or the containers of the shipment with its weight and description set of forth in such a manner as to permit checks of the contents by the customs on arrival at the port of destination as well as by recipient. (contain weight, description)