An LCL shipment of motor vehicle parts from a UK manufacturer to an importer in Johannesburg, South Africa. The goods will travel by sea in a multi-modal ship, using the DDP Johannesburg Incoterm. This is the required documentation.
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Pro-forma Invoice: This is a document that is sent by the seller. It sometimes acts as a quotation and the importer can use it to apply for a letter of credit. In this case, the UK manufacturer will issue the document to be received by the SA buyer.
Commercial Invoice: It is issued once the importer has accepted the quotation. The seller in the UK will issue it in this scenario. Both the importer and the exporter must have a copy of this document. The exporter will use it to seek the necessary exportation documentation and for bookkeeping purposes (Branch 2008). The importer will need it to prove ownership of the goods, and to be able to obtain the required import documentation. At times, a commercial invoice acts as a receipt where the payment is prompt.
The Packaging List: This is a list of all the items contained in the packages to be exported. The manufacturer in the UK is the one to prepare this list. This list is a mandatory requirement for many customs departments. The buyer in South Africa may use this list to acquire financing. According to the DDP incoterm, it is the manufacturer’s responsibility to ensure the goods get to Johannesburg in the right condition. Therefore, this list will act as proof of the goods’ condition.
Marine/Transit Insurance Certificate: DDP incoterm is the mode of shipment that has been agreed upon by both parties. This means that the safety of goods when in transit is the responsibility of the manufacturer. This is why the manufacturer in the UK has to insure the goods. The manufacturer is then issued with an insurance certificate. Once the goods arrive at their destination safely, this certificate expires. This certificate is also a requirement when seeking financing from a bank.
Export Cargo Shipping Instructions (ECSI): This is a vital document as it gives instructions on the path to be taken by the goods until they reach the buyer’s destination. In this case, the seller in the UK will prepare the document. The timeline of the goods’ movement is also included. The details of who should pay which charges are also included in this document.
Certificate of Origin: It identifies the origin of the spare parts as the UK. This is important when duty is being paid for these goods. This is in case there is a trade agreement between these countries. The origin of the goods in this scenario will be identified as the European Union (Bretherton 1999).
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Export Pre-lodgement Advice: This document applies to any exports coming from the UK. This electronic document will replace SAD in this case.
Standard Shipping Note: This document provides reliable and accurate information about the cargo to be shipped. This information is very useful when calculating freight and shipment charges (Grath 2008). According to this shipment arrangement, the seller in the UK will be the one to prepare this document. The document will then be available at the shipping port in the UK.
House Bill of Lading: This document will have to be prepared because the consignment in this scenario is less than the container load. Since the DDP incoterm shipping arrangement is used in this scenario, the seller in the UK will have to prepare this document.
A gun shipment is to be exported by a British manufacturer to the Saudi Arabian government. Carriage is to be by the sea in a conventional ship using CIF Jeddah Incoterm. This is the required documentation.
Pro-Forma Invoice: This is a document to be prepared by the British manufacturer and sent to the Saudi importer. This document is sometimes used as a quotation.
Commercial Invoice: It is issued after a Pro-forma invoice or a quotation. The British manufacturer will issue one to the Saudi Arabian government. Each party requires a copy of this document. The manufacturer needs it for bookkeeping purposes, and the Saudi government needs it as proof of ownership at the collecting port.
Packaging List: This is a list of the contents of the shipment. Details of the guns contained in each packaging unit are listed. This information contains both quantitative and qualitative details. According to the shipping agreement used in this scenario (CIF intercom), the packaging list should be made by the British Manufacturer. Once the goods reach the buyers, this list will be used to ascertain the state and quantity of the guns.
Dangerous Goods Certificate: This is a requirement whenever an importer or exporter is handling goods of a volatile nature. The guns qualify as such goods. Therefore, both the British manufacturer and the Saudi importers need to comply. However, the Saudi government may be exempt from this requirement depending on the country’s legislation.
Export Licence: The British manufacturer needs to have this document so that the parties handling the goods in transit know that the manufacturer is operating legally. This license applies when goods that may be subject to criminal misuse are being handled (Wells 2011). The relevant authorities in the goods’ country of origin issue this document.
Transit/Marine insurance: The shipping arrangement stipulates that the British manufacturer has the responsibility of delivering the goods safely. Therefore, the manufacturer will have to ensure the goods to obtain this certificate. Once the guns are in Saudi’s government hands, this certificate becomes null.
Export Cargo Shipping Instructions (ECSI): This is a document detailing the path to be taken by the goods until they reach their destination. In this case, the destination is Saudi Arabia. It contains timelines and directions to be adhered to by the consignment. This information is to be used by the parties handling the goods when they are in transit.
Certificate of Origin: This is a document indicating the goods’ country of origin. The customs departments to calculate duty to be imposed on the goods using it. Any prior trade agreements between the countries involved (Britain and Saudi Arabia) are factored in.
Arabic Certificate: This is a requirement for any trade between Britain and the Arab League countries (Dave 1995). In this case, the Saudi Embassy in Britain will issue it. It helps certify the origin of the goods and therefore aid in the clearance of the goods when they get to Saudi Arabia.
Export Pre-lodgement Advice: This document applies to any exports coming from the UK. In this case, EPLA documentation will replace SADly.
Bill of Lading: This is a document that accompanies the goods throughout their journey. It acts as proof that the goods were handed over to the shipping authorities by the British manufacturer.
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Bretherton, C 1999, The European Union as a global actor, London: Routledge.
Branch, A 2008, Export Practice, and Management 5th.Ed, London: Cengage.
Dave, C 1995, “An investigation into the targeting of UK export assistance”, European Journal of Marketing, Vol. 29 no. 8, pp.76 – 94.
Grath, A 2008, The handbook of International Trade and Finance, London: Kogan Page.
Wells, S 2011, British export performance: a comparative study, London: Cambridge University Press.