The trade between two nations involves significant documentation process.
In domestic trade, an organization has to fulfill only the requirements of taxation department of the own country and make a simple invoice against the customers.
However, in case of international trade, exporters and importers have to submit a number of documents to different institutions.
These institutions are as follows:
a. Importing organization that has placed order and exporting organization that is selling the goods
b. Taxation, custom control, and exchange control authorities of both the countries
c. Port authorities for loading and unloading of goods
d. Shipping and warehousing authorities for transporting and storing goods
e. Inspection agencies that inspect and verify the products
f. Banks of exporting and importing countries if involved
Export documentation plays a vital role in the flow and movement of goods and services in international markets. This documentation involves heavy and cumbersome paper work for exporting organizations.
There are various outsourcing agencies/ experts that prepare these documents on behalf of organizations and charge fee for it. Exporters have to understand the importance of each and every document. If they miss any document, the contract may be cancelled.
The discussion of these documents is as follows:
(a) Regulatory Documents:
Refers to the pre-shipment documents prescribed by the exporting country. The compliance of these documents is mandatory for an export contract.
The regulatory documents include:
i. Shipping bill
ii. Export application prescribed by port authorities
iii. Insurance payment certificate
iv. Excise gate pass for clearance of goods
(b) Commercial Documents:
Refer to those documents that are important for transferring the ownership from the exporter to the importer. These documents are necessary to meet the rules of the export trade.
The documents include the following:
i. Bills of exchange
ii. Letter of credit
iii. Marine insurance policy
iv. Bills of lading
v. Shipping instructions
vi. Shipping order
vii. Inspection documents
viii. Certificate of origin of goods
(c) Export Assistance Documents:
Involve those documents that are required for getting government assistance, such as subsidies. It includes documents, such as export-import contract and certificate of quality control.
(d) Documents prescribed by importer’s country:
Include pre-inspection, quality approval, and child labor norms related documents. The importer insists the exporter to submit these documents to fulfill the laws and regulations of the importer’s country. The export documents are necessary from the stage when the exporter receives the order till the final stage when he/she gets the payment from the importer. These documents help in the regulation of trade and facilitation of export operation.