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EXPORT/IMPORT PROCEDURES

EXPORT/IMPORT PROCEDURES. FOB FREE ON BOARD. Cost of freight & insurance to a certain point in the transportation link (usually within the exporting country) is included in the seller’s price. Buyer must pay for freight beyond that point. Specification of fob location is critical.

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EXPORT/IMPORT PROCEDURES

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  1. EXPORT/IMPORT PROCEDURES

  2. FOBFREE ON BOARD • Cost of freight & insurance to a certain point in the transportation link (usually within the exporting country) is included in the seller’s price. • Buyer must pay for freight beyond that point. • Specification of fob location is critical. • Ex-factory, Ex-city, Ex-port.

  3. CIFCOST, INSURANCE, & FREIGHT • Cost of freight and insurance to a port in the importing country is included in the seller’s price. • Buyer must pay for freight beyond the port. • Specification of cif location is useful. • Ex-port.

  4. C&FCOST & FREIGHT • Cost of freight to a port in the importing country is included in the seller’s price. • Buyer must pay for insurance from the originating point and freight beyond the port. • Specification of c&f location is useful. • Ex-port.

  5. LANDED PRICE • Usually refers to the ultimate cost of the product to the buyer at his/her place of business after paying for cost, freight, insurance, and customs fees and duties. • Useful benchmark for comparing quotes from different suppliers.

  6. EXPORT LICENSE • THE U.S. HAS TWO TYPES OF LICENSES: • VALIDATED LICENSE • GENERAL LICENSE

  7. IMPORT LICENSE • MAKE SURE THE IMPORTER HAS OBTAINED AN IMPORT LICENSE IF NECESSARY IN THE IMPORTING COUNTRY.

  8. EXPORT DOCUMENTS • Export license • Shipper’s export declaration • Bill of lading (airway bill) • Packing list • Insurance certificate • Special purpose certificates • EX: Country of origin, Quality, Standards, etc.

  9. COLLECTION DOCUMENTS • Commercial Invoice • Consular Invoice • Letter of Credit or Other Instruments for payment collection. • D/A • D/P

  10. LETTER OF CREDIT • A letter issued by a bank guranteeing payment to the seller on proof of shipment • Irrevocable: A L/C that is irrevocable. • Confirmed: A L/C that is endorsed by a second bank, that takes up the responsibility to pay the seller.

  11. D/A AND D/P • D/P: Documentary upon Payment • Documents are released to buyer upon payment. • D/A: Documentary upon Acceptance • Documents are released to buyer upon his acceptance. D/A is like open account.

  12. IMPORT DOCUMENTS • Import license (if required) • Import declaration form • Customs bond • Special tariff considerations • Special certificates

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