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Import & Export Procudure

This document summarizes key terms related to international import and export procedures: 1) It outlines different terms of sale (Ex work, FOB, C&F, C&FI) that determine which party bears costs such as loading, carriage, and insurance. 2) It describes two common payment options - telegraphic transfer and letter of credit - and considerations for each such as risk level and regulatory guidelines. 3) It provides an overview of documentation requirements for opening a letter of credit, including proforma invoices, commercial invoices, and bank communications and checks involved in the process.

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Arshad Rashid
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582 views4 pages

Import & Export Procudure

This document summarizes key terms related to international import and export procedures: 1) It outlines different terms of sale (Ex work, FOB, C&F, C&FI) that determine which party bears costs such as loading, carriage, and insurance. 2) It describes two common payment options - telegraphic transfer and letter of credit - and considerations for each such as risk level and regulatory guidelines. 3) It provides an overview of documentation requirements for opening a letter of credit, including proforma invoices, commercial invoices, and bank communications and checks involved in the process.

Uploaded by

Arshad Rashid
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Import & Export procedure:

Ex work: Buyer will bear all the expenses


FOB: Seller will bear the expenses until loading of cargo in ship
C & F (Carriage and Frieght): Seller bear the expenses until the cargo arrived in buyer port.
C & FI (Carriage and Frieght and Insurance): Seller bear the expenses including insurance until the car

Two options of Payment


1)TT
2) Letter of Credit

TT 1) Open Market: Risky, Flexible, Not recommended, Financial transactions trail missed,
2)Banking Channel: Regulated by SBP
For Machinery, no advance payment can be made. Can only made when machin
For Raw material, US$ 10K is limit / perday
Third party TT can not be made. E.g If middle man is involved who have export l
through MM but give documents of manufacturer and MM wants cheq
SBP dont allow it.

Back to Back LC
If middle man does not wants to conceal the identity of manufacturer and importer, then h
First with manufacturer and second with importer

Charter Bill of Lading


Where hirer of space of vessel (e.g. Exporter) issued LC. It is just the guaranty of hiring of s

Liner Party Bill of Lading: Vessel issued this type of LC. It guarnatess the loading of specified items on

Requirements for LC

BEFORE LC OPENING
1) Last 3 years of accounts OR License of Import and Certificate issued by the
2)Management accounts of last year
3)Annual Incom tax returns for last 3 years
4)Basic Borrower fact sheet
5)Board resolution with embossed stamp on letter head and Request for LC
6)List of plant and machinaries installed and their capacities
7)Insurance cover note and PRC (Proceed realization certificate from bank)

Performa Invoice
Before opening of LC, Issued by seller/Exporter When you are negotiating with banks

Commercial Invoice
After opening LC, which the exporter issued to importer.
AT LC OPENING
1) Bank send you draft swift message
2) You need to check carefully cluase 47-A to ensure terms and condition of LC
3) Bank send the message to exporter bank

AFTER LC OPENING
1) If you wanna change something in LC, the bank will charge you for that. (e.g. Change of
in buyer port.
ng insurance until the cargo arrived in buyer port.

actions trail missed,

only made when machinery arrived

volved who have export licence, buyer imports


urer and MM wants cheque on his name,

rer and importer, then he will open Two LCs

he guaranty of hiring of space. Bank do not accept this LC.

ng of specified items on the ship. Banks accepts it.

Certificate issued by the Chamber of Commerce

otiating with banks


ndition of LC

for that. (e.g. Change of port)

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