Documents used in Foreign Trade and Means of Payment
1. Bill of Lading:
This document contains the name of the ship, full particulars of the goods, the quantity and type. It is drawn by the shipowner and it is usually in three sets, one copy is given to the importer, one sent to the exporter and the remaining one is retained by the shipowner. Bill of lading is a document of title of goods on board. It enables the holder to claim ownership of the goods on arrival.
The contents of the bill of lading includes:
1. The name of the ship carrying the goods
2. The shipper’s name
3. Name of the exporter
4. Name of the importer
5. Port of loading
6. Address of the exporter and importer
7. Port of destination
8. Conditions & Carriage
9. Description of goods such as quantity, types and weight
10. Expected time of arrival
Bill of lading can be dirty or clean bill
(a) Dirty Bill: This bill indicates some irregularities, damages or difficulties to the goods. It is also called a foul bill.
(b) Clean Bill: This bill shows that the goods are in perfect condition and are free from damages.
2. Airway Bill:
It is a document used when goods are sent by air. It contains the names and address of the importer and exporter and also the port of destination. Airway bill contains; names and addresses of the importer and exporter, the airport of loading, freight charged, airport of destination, and description of goods.
This is a foreign order which includes details of the goods required by the purchaser. It can be closed or open.
(a) Closed Indents: The producer to be bought goods from will be specified by the foreign buyer. Closed indent names a particular manufacturer from whom goods are to be purchased.
(b) Open Indent: In open indents, these is no choice of manufacturer/producer. The agent can purchase goods from whosoever he pleases.
4. Consular Invoice:
The prices of goods been sent are listed in this document. A consul from the imports country certified goods as being correct. This document is signed by the buyer’s consul for assessing liability for import duties to ensure that the goods have been correctly priced.
5. Ship Manifest:
This form is completed by the captain of the ship showing the details of passengers and goods on board a ship. The custom is left in custody of this document before leaving the port.
6. Import License:
This document gives authority to import specified goods issuing of the license will reduce the number of importers of some foreign-made goods.
7. Freights Note:
This document is issued by the shipping company showing full details of the charges for shipping a consignment of cargo on a particular journey.
8. Bill of Exchange:
It is an unconditional order in writing addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future a certain sum of money to the order of a specified person or to the bearer.
Uses of bill of Exchange
(i) It reduces the risk of moving large sum of money.
(ii) The buyer can defer a payment for goods.
(iii) Date of payment is fixed.
9. Certificate of origin:
This document states the country from which the shipment of goods originated from. It helps to obtain preferential tariffs and to determine custom duties. It helps to ascertain that goods are manufactured in the country stated.
10. Certificate of Insurance:
This document is proof that the parties involved in the transactions have insured the goods in transit. It shows that the exporter has paid for insurance.
11. Custom Specification:
This document is submitted to the customs authorities responsible for recording the value of imports and exports. This information is necessary for calculating the balance of trade. It shows the value of goods exported and the country to which they are consigned.
12. Export Invoice:
This is a document sent to the importer by the exporter giving full details of the goods sent, prescription of the goods, terms of sale, quantity, price other charges and total amount to be paid.
13. Dock Warrant:
This is a receipt for goods stored in the warehouse which entitles the holders to take possession of the goods. It states that goods awaiting clearing have been kept in the warehouse by the owner.
14. Shipping Note:
This is a document sent to the shipping agent by the exporter. The document contains instructions for transporting the goods. It is a request to the shipping company to transport the goods to a named destination at a particular time.
15. Mate Receipt:
This is a document used when goods are loaded on a ship by lighter. This document will be exchanged afterward for a bill of lading.
16. Docklading Account:
This is a document issued to the master of the ship on its arrival at a port. The ship is given a reference number and information on cargo together with particulars of any damaged goods.
17. Bill of Sight:
This is a document used in the import trade where importers are required to complete the appropriate entry’s document if there is insufficient information about the cargo to determine the correct duty in advance. This document enables the goods to be landed and their inspection is authorized by the customs while a full description of the goods will be provided later.
Uses of Bill of Sight
- It is used to determine the duty on the cargo
- It is very important when there is insufficient information about the cargo
18. Bill of Entry:
This is a foreign document which contains detailed particulars of all imported goods into the country. It provides the customs with particulars of goods imported which must be presented at the port on arrival before they are allowed into the country.
19. Calling Forward Note:
This is a document sent by the shipping company to the forward agent, stating the date which goods must arrive at the dock for loading.
20. Ship Report:
This is a document which must be supplied by the master of a ship to the customs authorities on arrival at a port. This report gives the particulars of the ship crew, passengers, cargo and port of department.