A Additional costs: the price you negotiate with overseas customers also needs to include some additional costs. For example, transportation costs may include the cost of special packaging and labelling, while the detailed documentation you generally need may involve extra costs.
Ad valorem: according to value (see Duty).
Advising bank: bank operating in an exporter's country that handles letters of credit (see Letter of credit) for a foreign bank by notifying the exporter that the credit has been opened in its favour. The advising bank lets the exporter know exactly what the conditions of the letter of credit are but isn't necessarily responsible for payment.
Air-Way Bill: a bill of lading (see Bill of lading) that covers both domestic and international flights carrying goods to a specified destination.
Anti-dumping: if a company exports a product at a price lower than the price it normally charges in its home market, it's said to be dumping the product. Member countries of the World Trade Organisation may be able to impose certain measures on other members that dump products on their markets.
Asian dollars: US dollars deposited in Asia and the Pacific Basin.
ATA: admission temporaire or temporary export, used in conjunction with the term carnet (see Carnet).
BBill of exchange: written document in which a supplier is guaranteed payment of a specified amount by a drawee by a fixed date. The drawee is generally the customer but is likely to be the customer's bank if the bill of exchange is used with a term letter of credit (see Letter of credit).
The bill can request immediate payment ("at sight" or "on demand"). It can specify payment at a later date ("the term"). Drawees become legally liable for payment once they accept (agree to pay) the bill.
Bill of lading: document generally issued by a shipper which acts as a receipt for goods received for carriage. In addition it provides evidence of the terms of contract between a shipper and a transport company under which goods are moved between specified places for a specified charge. And a bill of lading also acts as a transferable document of title to goods - meaning goods can be bought and sold simply by exchange of the bill. Bills of lading are used for all modes of transport - they're known as air waybills for airfreight. See also Air-Way Bill.
Bonded warehouse: warehouse authorised authorities concerned in the country for storing goods on which payment of duty is deferred until the goods leave the warehouse.
CCarnet: Customs document which allows you to carry or send goods temporarily into certain countries for display or demonstration purposes without paying duty or posting a bond.
Cash in advance (CIA): full payment for exported goods before shipment is made.
Cash with order (CWO): the buyer pays for goods when ordering. The transaction is binding on both supplier and customer.
Certificate of inspection: document certifying that certain types of goods (such as perishable items) were in good condition before shipment.
Certificate of insurance: shows insurance cover has been arranged for goods being exported. It should detail the degree of cover and list the policy number and all other relevant details.
Certificate of manufacture: statement (often legalised by a notary) in which a producer of goods certifies that manufacture has been completed and the goods can be bought.
Certificate of origin (C/O): statement on the origin of goods. You may need one if you're exporting to a number of countries. They're available from your Chamber of Commerce for goods of EU origin.
CFR: cost and freight. This is an Incoterm (see Incoterms). The seller clears the goods for export and meets the cost of carriage to the port in the destination country. But the buyer bears all risks after delivery, which occurs when goods pass over the ship's rail in the port of shipment. The buyer also bears any extra costs caused by events that happen after delivery.
CIF: cost, insurance and freight. This is an Incoterm (see Incoterms). The seller clears goods for export and meets the cost of carriage to the port in the destination country, including insurance. But the importing buyer bears all risks, except marine insurance, after delivery.
Delivery occurs when goods pass over the ship's rail in the port of shipment. The buyer also bears any extra costs caused by events that happen after delivery.
CIP: carriage and insurance paid to (named place of destination). This is an Incoterm (see Incoterms). The seller clears the goods for export and pays for delivery to the named destination. The goods are delivered when the seller passes the goods to its carrier. From this point the buyer takes responsibility for all costs and risks. But the seller must also take out insurance to cover the buyer's risk during transport.
Commercial agent or sales agent: person or organisation appointed by exporter to sell and distribute goods in a foreign country. (See Distributor).
Commercial invoice: bill listing the goods and prices shipped by an exporter.
Confirmed letter of credit: letter of credit issued by an overseas bank but also confirmed by another bank. Under these circumstances you'll be paid by the confirming bank even if your buyer or the other bank defaults, providing the terms of the letter are met fully. (See Letter of credit).
Consignment: when goods are exported subject to consignment, the exporter only receives payment on completed sales. Any unsold items may be returned to the exporter, usually at their expense. This is a high-risk method of payment for an exporter.
Consolidator: company issuing bills of lading (see Bill of lading) for the carriage of cargo on vessels or aircraft.
Containerised/containerisation: the packing of goods for transport in sealed containers.
Convertible currency: a currency that can be bought and sold for other currencies at will.
Correspondent bank: bank that handles in its own country the business of a foreign bank.
CPT: carriage paid to (named place of destination). This is an Incoterm (see Incoterms). The seller clears the goods for export and pays for delivery to the named destination. The goods are delivered when the seller passes the goods to its carrier. From this point the buyer takes responsibility for all costs and risks.
Credit-risk insurance: insurance for exporters designed to cover risks of non-payment for delivered goods.
Customs commodity code: eight-digit commodity code required for exports outside the EU. It needs to be entered on your customs export declaration. Sometimes known as the "first eight digits of the Customs Tariff number" or "CN (Customs nomenclature) code", it's also used as the basis for the import declaration in the country of destination.
Customs Freight Simplified Procedures (CFSP): electronic declaration methods that simplify customs procedures for clearing non-EU imported goods either at a frontier or upon removal from a free zone or customs warehouse.
DDAF: delivered at frontier (named place). This is an Incoterm (see Incoterms). The seller clears the goods for export and pays for delivery. The goods are delivered - not unloaded or cleared for import - when they arrive at the named place at the frontier of the importing country but outside the customs border. The buyer clears the goods for import and is responsible for all costs and risks from this point.
Dangerous goods note: document required when shipping hazardous or potentially hazardous goods.
DDP: delivered duty paid (named place of destination). This is an Incoterm (see Incoterms). The seller clears the goods for export and pays for delivery to the named destination. The seller meets all the costs and risks of clearing the goods for import, though the buyer may agree to bear some of the costs. The goods are delivered when they arrive, cleared for import but not unloaded, at the named destination.
DDU: delivered duty unpaid (named place of destination). This is an Incoterm (see Incoterms). The seller clears the goods for export and pays for delivery. The goods are delivered when they arrive at the named destination place, not cleared for import or unloaded. The buyer is responsible for clearing the goods for import and the associated costs and risks, though the seller can agree to bear some of these costs.
DEQ: delivered ex quay (named port of destination). This is an Incoterm (see Incoterms). The seller clears the goods for export and pays for delivery. The goods are delivered when they're placed on the quay at the named port of destination. The buyer is responsible for clearing the goods for import and the associated costs, unless agreed otherwise.
DES: delivered ex ship (named port of destination). This is an Incoterm (see Incoterms). The seller clears the goods for export and pays for delivery. Delivery occurs when the goods are placed at the disposal of the buyer on board the ship at the named port of destination. From this point the buyer bears the costs and risks of clearing the goods for import and unloading.
Distributor: overseas agent which sells for a supplier directly and maintains an inventory of the supplier's products. (See Commercial agent or sales agent).
Documentary collection: where you draw up a bill of exchange (see Bill of exchange), which allows you to keep control of your goods and raise additional finance.
An overseas bank, acting on your bank's behalf, will only release the documents necessary for your customer to take possession of goods once it formally accepts the terms of the bill. Documentary collections are typically used for exports outside the EU to customers you have an established relationship with.
Documentary credits: letters of credit are the most secure method of payment (other than payment in advance). Your customer arranges a letter of credit with its bank which pays a corresponding bank in your country - the advising bank - once you submit all the necessary documentation.
An accurate and authentic "irrevocable" letter of credit, verified by your bank, carries little credit risk. Documentary credits are typically used for exports to customers you have not sold to before, and for customers and countries that present particular credit risks.
Duty: you may be required to pay import duty if you are bringing goods into your country. There is no duty on goods that are in free circulation (see Free circulation) within the EU.
For goods that are imported from outside the EU, the rate of duty depends on the product and the country of origin. Duty is based on the cost, insurance and freight value (ad valorem duties) of the goods. Rates of duty can vary suddenly and without warning and can have a significant effect on the value of the goods.
Click here for reading - Export and Import Terminology - A - D
Click here for reading - Export and Import Terminology - E - L
Click here for reading - Export and Import Terminology - M - Z
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