International trading for sure brings profit and success. But it’s not easy, a lengthy process with different kinds of complex legal procedures.
For every export business you are doing with another country, a system of legal matters should be addressed at all times, and different export businesses require different kinds of export procedures with documents matching their requirements.
These documents should be attested by the authorities to have the legal rights and status to import and export in their country. These documents make way for a smooth process for trading between the two nations without causing any distress.
For import and export, these documents are segregated in four types: Commercial, regulatory, export assisted and documents needed by the importing nation. Each of these categories will be discussed briefly.
Pro Forma Invoice:
Pro forma is a type of document which is sent by the supplier to the importer before shipping the goods. This document can also be referred as the confirmation of the order of purchase. Even though the document is used transport the payment, this invoice is usually used to inform about the specifications and details of the goods, its quality, and quantity.
Complete information about the goods exported to other countries is available in this document. Prices, shipping terms, goods, quantity, and HSN are included in this invoice with complete detail.
This invoice is needed for attaining the excise clearance, inspection certificate, clearance from customs, import license and compensatory support from the company.
Bill of Exchange:
This type of document is needed in the international market to get the payment conveniently. This type of document has an unconditional order requesting the importer/drawee to make a payment of a certain amount to the importer/drawer.
The drawee is bound to embrace the bill sent by the importer through signature and make the payment instantly or at a time decided between them.
Letter of Credit:
Typically known as L/C, this is a type of written commitment which asks the buyer or importer to pay a specific amount of fee to the seller or exporter.
If the supplied goods are shipped through airways, then the air waybill promotes three distinct functions: Receipt for the goods, note for the goods, and working as a bridge between the shipper and carrier.
Shipping bill is needed for getting the permission for export.
Legal Documents for Export:
For export, two types of documents are needed. First is the document required for the registration, while the second document is required for the shipment. One document requires a code number from RBI, code number from the exporter and importer, and a registration-membership-certificate.
Also, the shipment documents have a GR form, SOFTEX form, EP Form, etc.
Marine Insurance Policy:
This type of insurance policy is needed by the exporter for security reasons if he chooses to advance against the credits taken from the ban. This policy is nothing but a mere document or a form of contract between the insurer and the assured.
Documents for Importing Country:
GSP Certificate of Origin:
Goods which need special handling is given a certificate of GSP (generalized system of preferences)
This type of document is released by the consulate of the country who is importing, living in the country which is exporting. Payment of the valorem tax is required to be paid to the customs of the importing company based on the value of the goods issued on the invoice.
The customs invoice is released by the customs authority of the country who is importing goods. They are required to pay the import duty based on this invoice.
Certificate of Origin:
This document contains all the legal information suggesting that the goods are produced and manufactured in the exporting country.
Export Assistance Documents:
The Drawback of Duty:
This type of document is necessarily needed to attain the incentives. The documents are drawback payment, shipping bill and finalized commercial invoice
Registration Application Form:
Exporters are required to register themselves with different authorities like CCIE or EPC. The statement of the bank of the financial status of every exporter needs to be attached with the registration form.
Allotment of Indigenous Raw Materials:
This type of document is essentially needed by different ministries whose raw materials are being used for the goods you are exporting.