Introduction:

Background of the Study

This examination is about fare/import documentation of shipment. The point is to center around archives
required for Export/Import. There are numerous records associated with universal exchange, for example,
business reports, monetary archives, transport reports, protection reports and other worldwide exchange
related archives. In preparing the fare relegation, documentation might be executed in up to four gets: the
fare deals get, the agreement of carriage, the agreement of back and the agreement of load protection. It is
in this manner critical to comprehend the part of each archive and their necessities in the universal
exchange.
Various archives are required for transportation imposing measure of documentation is required in The
Export/Import Process. Documentation must be exact in light of the fact that slight errors or exclusions
may keep stock from being sent out, result in delinquency, or even outcome in the seizure of the shipment
by traditions. Gathering reports are liable to exact time confines and may not be regarded by a bank if
time has terminated. Most documentation is normal for cargo forwarders and traditions merchants, yet the
exporter is at last in charge of the precision of its substance.
One of the parts of global exchange that business people find most difficult is the extensive rundown of
reports required for fare and import. However, this extensive rundown isn't only a hindrance put to
convolute strategies. Fare import documentation serves to accomplish certain essential capacities.
Subsequently, it is essential to comprehend the attributes and motivation behind each report required for
universal exchange.

Rationale of the Study

A standout amongst the most essential segments of an effective worldwide business exchange is the
exact consummation of required fare documentation and import documentation. Inability to deliver
such documentation can frustrate the dispatch of items by a producer or provider, and can at last
obstruct the convenient receipt of merchandise by the client. In more serious cases, entrepreneurs can
be liable to fines or imprisonment for neglecting to follow import or fare documentation necessities.
With the advancement of the worldwide economy, global exchange is blasting between nations.
There are numerous assembling organizations who are currently sending out their products to various
parts of the world to extend their organizations; subsequently the fare business is prospering. Then
again there are numerous nations who are bringing in products from various parts of the world. Be
that as it may, despite the fact that the worldwide economy has open up, there are numerous
principles and controls representing the fare and import industry in every nation and in addition
universally are expected to remember before beginning a fare or import business. Since, universal
exchange occurs between two nations, the measure of documentation required is broad, mind
boggling and required at each period of the fare or import process.

1
Significance of the Study

Exporting and importing helps grow national economies and expands the global market. Every country is
endowed with certain advantages in resources and skills. For example, some countries are rich in natural
resources, such as fossil fuels, timber, fertile soil or precious metals and minerals, while other countries
have shortages of many of these resources. Additionally, some countries have highly developed
infrastructures, educational systems and capital markets that permit them to engage in complex
manufacturing and technological innovations, while many countries do not.
Exports and Imports around the globe varies, as of the district political policies and international business
environment. Exporting is not always an easy endeavor. Export is complicated, and not generalized
globally, because of the variation of business environment of various countries. Formal trade barriers are
barriers to trade that are intentionally created for the express purposes of making it harder for an exporter
to sell goods in a foreign market, while informal trade barriers are not necessarily created to hinder
imports of goods but have the effect of doing so. Let's take a look at some of the more prevalent barriers.
Importing can also present complications, such as managing long-distance relationships and organising
international transport and customs clearance. Common pitfalls can cause importers to incur unnecessary
costs and delays in arrival of goods. Successful importing requires an understanding of customs rules and
procedures as well as the duty and excise relief available.
However, international barriers have been brought down while a number of international treaties and
trade association have been established between countries and group of countries, with an objective to
promote international business.

Below listed are the crucial import/export documents which are inevitable to conduct foreign trade.

List of documents necessary for imports and exports are:

1. Common export documents
● Commercial Invoice: The commercial invoice is a legal document between the supplier and the
customer that clearly describes' the sold goods, and the amount due on the customer. The
commercial invoice is one of the main documents used by customs in determining customs
duties.
● Export Packing List: A packing list is also used as a supporting document in the event of a
dispute between the carrier and the exporter regarding the measurement and weight of the cargo.
It is a means by which customs authorities in the importing country assess security and
compliance.

2
 ● Proforma Invoice: A pro forma invoice is a document that states a commitment on part of the
seller to deliver the products or services as notified to the buyer for a specific price. It is thus not
a true invoice.
2. Transportation documents
● Airway Bill: a receipt issued by an international airline for goods and an evidence of the contract
of carriage, but it is not a document of title to the goods. Hence, the air waybill is non-negotiable.
● Bill of Lading : a detailed list of a ship's cargo in the form of a receipt given by the master of the
ship to the person consigning the goods.
3. Export compliance documents
● Export License: document issued by a government agency to monitor the export of sensitive
technologies (such as advanced computer chips, encryption-decryption software), prohibited
materials (drugs, genetically-modified plants), dangerous materials (explosives, radioactive
substances), strategic materials (uranium, advanced alloys), or goods in short supply in the home
market (foodstuffs, raw materials).
● Destination Control Statement: The Destination Control Statement is a legal statement required
by the Export Administration Regulations (EAR) and the International Traffic in Arms
Regulations (ITAR) stating that the goods you are exporting are destined to the country indicated
in all the shipping documents.
● Bill of Exchange: a written order to a person requiring them to make a specified payment to the
signatory or to a named payee; a promissory note
4. Certificates of origin
5. Other certificates for shipments of specific goods(Dangerous Goods Certificate, Certificate Of
Analysis, Fisheries Certificate, health Certificate)
6. Other export-related documents(Consular Invoice, Customs Invoice)
7. Temporary shipment documents(Temporary Shipment Certificate).

Sequence of export processing

The steps for export are as follows:
 Enquiry
 Proforma generation
 Order placement
 Order acceptance
 Goods readiness and documentation
 Goods removal from works
 Documents for C and F agent
 Customs clearance
 Document forwarding
 Bills negotiation
 Bank to bank document forwarding

3
  Customs obligation discharge
 Receipt of bank certificate

Shipping

 The handling of transportation is similar for domestic orders and export orders
 The export marks should be added to the standard information shown on a domestic bill of
lading
 The exporter should also include instructions for the inland carrier to notify the international
freight forwarder by telephone on arrival
 International shipments are increasingly being made on a through bill of lading under a
multimodal contract
 The multimodal transport operator (frequently one of the modal carriers) takes charge of and
responsibility for the entire movement from factory to the final destination

Procedure of ERC
Procedure for issuance Export Registration Certificate has been simplified. It requires only the
following documents:
 Trade License
 Membership Certificate from recognized Chamber/Trade Association
 Tax Identification Number
 Bank Certificate
 Memorandum and Articles of Association and Certificate of Incorporation (in case of
Limited Company)

Sample of documents

What is a 'Letter Of Credit'

A letter of credit is a letter from a bank guaranteeing that a buyer's payment to a seller will be
received on time and for the correct amount. In the event that the buyer is unable to make
payment on the purchase, the bank will be required to cover the full or remaining amount of the
purchase. Due to the nature of international dealings, including factors such as distance, differing

4
laws in each country, and difficulty in knowing each party personally, the use of letters of credit
has become a very important aspect of international trade.

Because a letter of credit is typically a negotiable instrument, the issuing bank pays the
beneficiary or any bank nominated by the beneficiary. If a letter of credit is transferrable, the
beneficiary may assign another entity, such as a corporate parent or a third party, the right to
draw.

Example of a Letter of Credit

Citibank offers letters of credit for buyers in Latin America, Africa, Eastern Europe, Asia and the
Middle East who may have difficulty obtaining international credit on their own. Citibank’s
letters of credit help exporters minimize the importer’s country risk and the issuing bank’s
commercial credit risk. Letters of credit are typically provided within two business days,
guaranteeing payment by the confirming Citibank branch. This benefit is especially valuable
when a client is located in a potentially unstable economic environment.

5
6
Significance of LC
A letter of credit is a document from a bank that guarantees payment. There are several types of
letters of credit, and they provide security when buying and selling.

 Seller protection: If a buyer fails to pay a seller, the bank that issued a letter of credit will pay
the seller if the seller meets all of the requirements in the letter. This provides security when the
buyer and seller are in different countries.

 Buyer protection: Letters of credit can also protect buyers. If you pay somebody to provide a
product or service and they fail to deliver, you might be able to get paid using a standby letter of
credit. That payment can be a penalty to the company that was unable to perform, and it’s similar
to a refund, allowing you to pay somebody else to provide the product or service needed.

If you're familiar with escrow services, the concept is similar: Banks act as "disinterested" third
parties (they don't take anybody's side), and they release funds only after certain conditions are
met. Letters of credit are common in international trade, but they are also used in domestic
transactions like as construction projects.

Key points:

 A letter of credit provides protection for sellers (or buyers).

 Banks issue letters of credit when a business “applies” for one and has the assets or credit to get
approved.
 Letters of credit are complicated, and it’s easy to make an expensive mistake when using one.

Example

1. A manufacturer gets an order from a new customer overseas. The manufacturer has no way of
knowing if this customer can (or will) pay for the goods after they’re produced and shipped.
2. To manage risk, the seller uses an agreement requiring the buyer to pay with a letter of credit as
soon as shipment is made.
3. To move forward, the buyer needs to apply for a letter of credit at a local bank. The buyer may
need to have funds on hand at that bank or get approval for financing from the bank.
4. The bank will only release funds to the seller after the seller proves that the shipment happened.
To do so, the seller typically provides documents showing how goods were shipped (with details
like the exact dates, destination, and contents). In some ways, the buyer also enjoys protection
under a letter of credit: Buyers might prefer to pay a bank with a big legal department than send
the money directly to an unknown seller.
5. If the buyer is concerned about a dishonest seller, there are additional options available for the
buyer’s protection. For example, somebody can inspect the shipment before the payment is
released.

7
What is a 'Bill of Exchange?
A bill of exchange is a written order used primarily in international trade that binds one party to pay a fixed
sum of money to another party on demand or at a predetermined date.

Bills of exchange are similar to checks and promissory notes. They can be drawn by individuals or banks
and are generally transferable by endorsements. The difference between a promissory note and a bill of
exchange is that the latter is transferable and can bind one party to pay a third party that was not involved
in its creation.There are up to three parties involved in a bill of exchange transaction. The drawee is the
party that pays the sum specified by the bill of exchange. The payee is the one who receives that sum. The
drawer is the party that obliges the drawee to pay the payee. The drawer and the payee are the same entity,
unless the drawer transfers the bill of exchange to a third-party payee.

Bills of exchange generally do not pay interest, making them in essence post-dated checks. They may accrue
interest if not paid by a certain date, however, in which case the rate must be specified on the instrument.
They can, conversely, be transferred at a discount before the date specified for payment.

If these bills are issued by a bank, they can be referred to as bank drafts. If they are issued by individuals,
they can be referred to as trade drafts. If the funds are to be paid immediately or on demand, the bill of
exchange is known as a sight bill; if they are to be paid at a set date in the future, it is known as a term bill.

Fig : sample of exchange

8
Bills of lading
A bill of lading (sometimes abbreviated as B/L or BoL) is a document issued by a carrier (or his agent) to
acknowledge receipt of cargo for shipment. A bill of Lading must be transferable and serves three main
functions:
 It is a conclusive receipt, i.e. an acknowledgement that the goods have been loaded
 It contains or evidences the terms of the contract of carriage
 It serves as a document of title to the goods, subject to the nemo dat rule.

Fig : Bills of lading

9
Invoice
An invoice, bill or tab is a commercial document issued by a seller to a buyer, relating to a sale
transaction and indicating the products, quantities, and agreed prices for products or services the seller
had provided the buyer.
Payment terms are usually stated on the invoice. These may specify that the buyer has a maximum
number of days in which to pay and is sometimes offered a discount if paid before the due date. The
buyer could have already paid for the products or services listed on the invoice.

Fig : Invoice

10
Proforma Invoice

A proforma invoice is a quote in an invoice format that may be required by the buyer to apply for an
import license, contract for pre-shipment inspection, open a letter of credit or arrange for transfer of hard
currency.
A proforma may not be a required shipping document, but it can provide detailed information that buyers
need in order to legally import the product.
Proforma invoices basically contain much of the same information as the formal quotation, and in many
cases can be used in place of one. It should give the buyer as much information about the order as
possible so arrangements can be made efficiently. The invoices inform the buyer and the appropriate
import government authorities details of the future shipment; changes should not be made without the
buyer’s consent.
As mentioned for the quotation, the points to be included in the proforma are:

1. Seller’s name and address

2. Buyer’s name and address
3. Buyer’s reference
4. Items quoted
5. Prices of items: per unit and extended totals
6. Weights and dimensions of quoted products
7. Discounts, if applicable
8. Terms of sale or Incoterm used (include delivery point)
9. Terms of payment
10. Estimated shipping date
11. Validity date

11
Fig : Proforma Invoice

12
Commercial Invoice
When used in foreign trade, a commercial invoice is a customs document. It is used as a customs
declaration provided by the person or corporation that is exporting an item across international borders.
Although there is no standard format, the document must include a few specific pieces of information
such as the parties involved in the shipping transaction, the goods being transported, the country of
manufacture, and the Harmonized System codes for those goods. A commercial invoice must often
include a statement certifying that the invoice is true, and a signature.
A commercial invoice is used to calculate tariffs, international commercial terms (like the Cost in a CIF)
and is commonly used for customs purposes. Commercial invoices in European countries are not
normally for payment. The definitive invoice for payment usually has only the words "invoice". This
invoice can also be used as a commercial invoice if additional information is disclosed.
The document recording a transaction between the seller and the buyer. Commercial invoices are
normally prepared by sellers, and should include the following information:
• Date, names, and commercial addresses of the seller and the buyer.
• Precise denomination and quantity of goods.
• Unit and total price of the goods in the agreed currency.
• Means and conditions of payment.
• Delivery terms of the goods (it refers to Incoterms published by the International Chamber of
Commerce). Nowadays the version in force is that of the year 2010. Apart from the above mentioned
data, which are demanded in the regulation in force, this document must also include:
• Seller´s and buyer´s identification for VAT purposes (in intra-communitarian operations).
• Order reference number.
• Origin of the goods.
• Tariff code of the goods
• Means of transport.
• A signature by an authorized person at the seller´s company, if required by the buyer´s
government.
The commercial invoice on itself does not grant any ownership of the goods, unless it has an attached
document proving the importer’s payment for the total amount. The number of copies of the invoice (both
original and copies) required for the delivery of the goods, must be agreed with the importer. Usually,
invoices are issued with the original and two copies. Although normally the legislation in different
countries does not limit the number of originals, it is not advisable to make more than those strictly
necessary in order to accomplish with the customs needs required by the buyer. It is advisable that the
importer confirms with the exporter all data that the invoice must provide before its issuing, as well as the
particularities it must include in order to accomplish with the regulation of the destination country.

13
Fig :Commercial Invoice

14
Packing List
A seller-prepared commercial document indicating the net and gross weights, dimensions and contents of
all shipping pieces (boxes, crates, bundles, etc.) in a shipment. Each packing list should reference
the shipment for which is made, and the line item totals should agree with the relevant commercial
invoice.

A packing list should be made for all shipments consisting of more than one shipping piece for the
following reasons:
 They aid in identifying lost cargo, especially for carrier and insurance claims.
 They permit selective inspection by customs authorities, and many government require them for
large shipments.
 They provide a “map” of the shipment, enabling the buyer to easily unpack and stock the shipped
goods.

In certain cases it is advisable elaborate the packing list considering the information requested by
the importer, especially for customs purposes, as may be the case that the Customs request a “detailed
document”, for example, in the case of a machine, the identification of each of the parts and components

15
Fig : packing list

16
Conclusion
It is regularly said that global exchange is more about printed material than sending out or bringing in
merchandise. The significance of precise and right printed material can't be undermined at any stage.
Along these lines, in the event that you are intending to begin import or fare it is vital to be watchful
about the reports required with the end goal of import and fare. Along these lines, on the off chance
that you are managing in universal exchange, documentation is the way to a fruitful exchange.

With expanding globalization comes expanding issues. Troubles emerge in the import and fare
forms. Troubles emerge for singular nationals in nations that participate in exchange, especially when
residential markets apparently turn out to be less pertinent to an organization than the worldwide
markets that it is endeavoring to reach. As much as governments endeavor to energize exchange,
exchange arrangements have positive and negative effects, and incredible activities may flop in their
execution. More noteworthy oversight of all nations occupied with exchange and arranging exchange
understandings, would likely keep those exchange assentions more profitable to all gatherings
influenced. Who might offer such oversight, in any case, additionally turns into an issue. Legislatures
of individual nations may not be the best judges of what constitutes the best type of exchange
relationship, notwithstanding for their own kin, and surely not for individuals of different countries.
A few arrangements, for example, disadvantages, have positives and negatives, yet regularly singular
fragments of a general public are let alone for the advantages made by worldwide exchange.

It is obviously apparent that the import trade documentation methodology is a significant modest
bunch. It requires a considerable measure of investment to make sense of what documentation is
required for particular items and different target markets. Getting the records appropriately rounded
out and guaranteed by the significant specialists is yet another test. The smallest blunder or oversight
in this delicate region of import send out strategy could mean disappointment for your business as
your transfer may either be dismissed or appropriated by traditions specialists. Along these lines, it is
of most extreme significance to have clear learning about the diverse sorts of reports required for
import and fare reason. The attributes and capacity of each archive shifts, as it were, and it is vital to
deliberately and precisely total the documentation procedure associated with universal exchange
request to accomplish the coveted business destinations without legitimate deterrents.

Recommendations
On the basis of the study conducted the following recommendations have been developed.
The United Nations Centre for Trade Facilitation and Electronic Business (UN/CEFACT)
recommends that governments and those engaged in international trade and the movement of goods
should:

• Capture: Set up a national exchange information stock of current government office information
and data necessities from robotized frameworks and archives to cover all prerequisites for the global
exchange strategies identified with import, fare and travel.

• Analyze: Set up an examination of the data prerequisite and information component, building up
whether its need is basic and its utilization can be illustrated. While data is recognized by name, the
significance (what data is imparted by the information component) and setting are more essential.
The way toward breaking down the data comprises of assembling comparative information

17
component names and having a full comprehension of the meaning of every datum component and
the data necessities.

• Reconcile: Set up a union of the characterized and broke down exchange information posting
through the procedure of compromise. This includes the consent to utilize one information
component name with a typical definition and (or) normal coding, and accommodated principally
with the worldwide models of the United Nations Trade Data Elements Directory (UNTDED) and
the UN/CEFACT Recommended Code List. Should the group recognized other reference
information models for the Single Window advancement, the information components could be
additionally mapped to different gauges, for example, UN/EDIFACT set of Directories (Electronic
Data Interchange for Administration, Commerce and Transport) , World Customs Organization
(WCO) Data Model and UN/CEFACT Core Component Library (CCL).

References
 https://www.hg.org/article.asp?id=18850
 https://www.slideshare.net/SamiaIbrahim2/import-and-export-process-of-bangladesh
 https://www.export.gov/article?id=Bangladesh-Import-Requirements-and-Documentation
 https://www.google.com/search?q=Letter+of+credit+original&client=firefox-
b&source=lnms&tbm=isch&sa=X&ved=0ahUKEwiUqabp2L_aAhUDr48KHd76DyAQ_AU
ICigB&biw=1440&bih=786#imgrc=eX69gB2WsjBqWM:
 http://www.mondaq.com/turkey/x/100456/international+trade+investment/Advantages+of+U
sing+Letter+of+Credit+in+International+Transactions
 https://www.crfonline.org/orc/cro/cro-9-1.html

18