Documents play an important role in import/ export transactions. Documents that are incorrectly organized or missing can cause immeasurable distress for all the stakeholders. In the absence of office work, importers and exporters cannot surrender or acquire their shipments. They may even suffer a penalty and, worse yet, their credibility may suffer.
We will discuss the following topics:
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
Also check out our blog post on what shipping documentation is necessary for customs clearance.
What the authorities can do to reduce export-import documentation.
Here is a brief overview of the import-export documentation needs in India and government regulations.
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. Therefore, the procedure was time-consuming and expensive. It was also cited as a factor in India's poor performance at the World Bank's Ease of Doing Business Index. In 2014, India ranked 142 out of 189 countries (it has since risen 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. Moreover, India's ranking in Ease of Doing Business was to be raised to number one and exports doubled to $900 billion by 2020. Import and export documents should be reduced to three each for imports and exports, according to the committee.
The 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.
Important shipping documents for exports
Bill of Lading
The most important document for exporters. It is a mandatory document that must be signed by three parties: the exporter, the shipping line, and the importer. A complete and accurate set of bills of lading is needed from the shipping line or freight forwarder so that the exporter can dispatch it to the importer or importer's bank.
The following information appears on this bill of lading:
Description, amount, check here weight of products
Name and address of consignee
Terms of sale
2.Commercial Invoice cum Packing List
A settlement invoice of sale is issued by an exporter to an importer. Based on the purchase price, they can determine the responsibilities and taxes due on the products.
The document includes information such as:
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.] Their exam is facilitated, and at clearance, the tally is corrected.
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
Economic bill and packing list were previously separate files with the same fields.
3. Bill of Entry
Shipment bills or export bills are types of customs clearance applications. Using this information, customs determines whether an exporter has taken advantage of government incentives, such as:
Various tax exemptions, rebates, and refunds
Export benefits under various government programs
Import documents required
Bill of Lading
This is a must-have document for both exporters and importers. Both the exporter and the importer must sign the bill of lading. An importer cannot accept goods at his end without a bill of lading.
2. Commercial Invoice cum Packing List
Similarly, the importer needs this document as well. For the most part, customs clearance depends on the commercial invoice cum packing list.
3. Bill of Entry
Last but not least, importers need a bill of entry. At the port of entry, customs authorities inspect and clear goods based on a declaration from the importer. A policy or sales invoice is matched with this bill's information.
The information includes:
Type of cargo
Value of the goods
Quantity of the goods
This was a brief summary of the three documents that importers and exporters should always have on hand. It does not mean that these are the only documents required. The shipping process involves a lot of paperwork. 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.