FAQ
About International Trade
How can I learn about foreign product standards?
Please contact the National Institute of Standards and Technology.
How can I learn about import or export licensing?
The International Trade Administration's Import Administration licenses steel imports through the Steel Import Monitoring and Analysis System.
Please contact the Bureau of Industry and Security and/or U.S. Customs and Border Protection (importing, exporting).
I think that my company’s product would be successful in other countries, but I’m not sure how to get started in international business. Is there help for new exporters?
Exporting can be profitable for U.S. companies, large and small. To learn more about getting started, visit the Export Basics section on the U.S. government’s export portal, Export.gov. You’ll be able to take the Export Readiness Assessment and learn how to prepare to enter new markets. You can also talk to trade specialists at the U.S. Commercial Service’s Trade Information Center. Call 1-800-USA-TRAD(E)
I’m shipping my product to Canada. How do I fill out a NAFTA Certificate of Origin? Are there other documents to be filled out?
Your shipment may need a NAFTA Certificate of Origin and a Shipper’s Export Declaration. To learn more about export documentation, please visit Export.gov to learn more.
The U.S. Commercial Service’s Trade Information Center or the trade specialists at your local Export Assistance Center can also help answer these questions. Call 1-800-USA-TRAD(E) or find your local Export Assistance Center.
How can I learn more about my product or service’s sales potential in overseas markets?
Market Research is a good first step to learn about the sales potential of your product or service in countries abroad. The U.S. Commercial Service offers free online market research to U.S. companies seeking to enter international markets. Its database allows you to sort by country, industry, and/or type of market report. Visit the Commercial Service's Market Research Libraryand register to access these reports.
How can I locate importers, distributors, sales reps, etc. in an overseas market?
The U.S. Commercial Service has programs and services to help you locate potential business partners overseas. Contact your nearest U.S. Export Assistance Center and speak with an International Trade Specialist. You can also receive free export counseling and learn more about our programs and services to help you compete around the globe. Call 1-800-USA-TRAD(E) or visit Export.gov to find your local Export Assistance Center.
What can Market Access and Compliance (MAC) do to help your business?
After you contact our Trade Compliance Center or the country desk in one of our regional offices, MAC will evaluate whether the problem is a market access issue or a compliance problem with an existing trade agreement. MAC will establish a team of experts on the country, the industry, the trade agreement, and other needed areas. The team will review all possible options to resolve the problem and then work through each tactic toward a solution.
What is the difference between Market Access and Compliance?
Market Access – U.S. exporters sometimes encounter trade barriers. For instance, a country may only allow products to enter the most inconvenient port or a country may treat imported goods differently than domestic goods. MAC receives calls from businesses, associations, and international U.S. commercial offices, and we then map out a plan to solve the problem.
Compliance – The United States is a party in over 250 trade agreements. But trade agreements are only paper unless foreign governments comply with their obligations. MAC addresses compliance problems quickly and aggressively. Once a problem is identified, we organize a team to outline and implement a solution.
What are some common trade problems MAC can help U.S. businesses overcome?
MAC provides help with the following common trade problems through the Trade Compliance Center:
- Tariff and customs barriers
- Service barriers
- Standards, testing, labeling, or certification barriers
- Rules of origin
- Government procurement contract barriers
- Intellectual property protection problems
- Excessive government requirements
- Excessive testing or licensing fees
- Bribery
- Investment
What do MAC services cost?
MAC’s services are free of charge to all U.S. businesses.
What is Dumping?
Dumping occurs when a foreign producer sells a product in the United States at a price that is below that producer's sales price in the country of origin (home market), or at a price that is lower than the cost of production. The difference between the price (or cost) in the foreign market and the price in the U.S. market is called the dumping margin. Unless the conduct falls within the legal definition of dumping as specified in U.S. law, a foreign producer selling imports at prices below those of American products is not necessarily dumping.
Source: http://trade.gov/faq.asp
About Documents
There are many documents involved in international trade, such as commercial documents, financial documents, transport documents, insurance documents and other international trade related documents. In processing the export consignment, documentation may be executed in up to four contracts: the export sales contract, the contract of carriage, the contract of finance and the contract of cargo insurance. It is therefore important to understand the role of each document and its requirements in international trade.
Commercial Documents:
Quotation
An offer to sell goods and should state clearly the price, details of quality, quantity, trade terms, delivery terms and payment terms.
Prepared by: exporter
Sales Contract
An agreement between the buyer and the seller stipulating every detail of the transaction. Since this is a legally binding document, it is therefore advisable to seek legal advice before signing the contract.
Prepared by: exporter and importer
Pro Forma Invoice
An invoice provided by a supplier prior to the shipment of merchandise, informing the buyer of the kinds and quantities of goods to be sent, their value, and importation specifications (weight, size and similar characteristics). This is not issued for demanding payment but may be used when applying for an import licence / permit or arranging foreign currency or other funding purposes.
Prepared by: exporter
Commercial Invoice
A formal demand note for payment issued by the exporter to the importer for goods sold under a sales contract. It should give details of the goods sold, payment terms and trade terms. It is also used for the customs clearance of goods and sometimes for foreign exchange purpose by the importer.
Prepared by: exporter
Packing List
A list with detailed packing information of the goods shipped.
Prepared by: exporter
Inspection Certificate
A report issued by an independent surveyor (inspection company) or the exporter on the specifications of the shipment, including quality, quantity, and / or price, required by certain buyers and countries.
Prepared by: inspection company or exporter
Insurance Policy
An insurance document, with full details of the insurance coverage, evidencing insurance has been taken out on the goods shipped.
Prepared by: insurer or insurance agent or insurance broker
Insurance Certificate
This certifies that the shipment has been insured under a given open policy and is to cover loss of or damage to the cargo while in transit.
Prepared by: insurer or insurance agent or insurance broker
Product Testing Certificate
This certifies the products are conformed to a certain international / national technical standard, such as product quality, safety and specifications.
Prepared by: accredited laboratories
Health Certificate
Document issued by the competent country when agricultural or food products are being exported, to certify that they comply with the relevant legislation in the exporter's country and were in good condition at time of inspection, prior to shipment and fit for human consumption.
Prepared by: exporter / inspection authority
Phytosanitary Certificate
Frequently an international requirement that any consignment of plants or planting materials importing into a country shall be accompanied by a Phytosanitary Certificate issued by the exporting country stating that the consignment is found substantially free from diseases and pests and conforms with the current phytosanitary regulations of the importing country. Application of the certificate in Hong Kong should be made to the Agriculture and Fisheries Department.
Prepared by: exporter
Fumigation Certificate
A pest control certificate issued to certify that the concerned products have been undergone the quarantine and pre-shipment fumigation by the approved fumigation service providers. It is mainly required by the US, Canada, Australia, New Zealand and UK's customs on solid wood packing material from Hong Kong and the Chinese Mainland.
Prepared by: exporter or inspection company
ATA Carnet
An international customs document used to obtain a duty-free temporary admission for goods such as exhibits for international trade fairs, samples and professional equipment, into the countries that are signatories to the ATA Convention.
Prepared by: exporter
Consular Invoice
A document required by some foreign countries, showing shipment information such as consignor, consignee, and value description, etc. Certified by a consular official of the importing country stationed in the foreign country, it is used by the country's customs officials to verify the value, quantity and nature of the shipment.
Prepared by: exporter
Transport Documents:
Shipping Order S/O
A document with details of the cargo and the shipper's requirements, and is the basic document for preparing other transport documents such as bill of lading, air waybill, etc.
Prepared by: shipper / transport companies
Dock Receipt D/R or Mate's Receipt
A receipt to confirm the receipt of cargo on quay / warehouse pending shipment. The dock receipt is used as documentation to prepare a bill of lading. It has no legal role regarding processing financial settlement.
Prepared by: shipping company
Bill of Lading (B/L)
An evidence of contract between the shipper of the goods and the carrier. The customer usually needs the original as proof of ownership to take possession of the goods. There are two types: a STRAIGHT bill of lading is non-negotiable and a negotiable or shipper's ORDER bill of lading (also a title document) which can be bought, sold or traded while goods are in transit and is used for many types of financing transactions.
Prepared by: shipping company
House Bill of Lading (Groupage)
A bill of lading issued by a forwarder and, in many cases, not a title document. Shippers choosing to use a house bill of lading, should clarify with the bank whether it is acceptable for letter of credit purpose before the credit is opened. Advantages include less packing, lower insurance premiums, quicker transit, less risk of damage and lower rates than cargo as an individual parcel / consignment.
Prepared by: forwarder
Sea Waybill
A receipt for cargo which incorporates the contract of carriage between the shipper and the carrier but is non-negotiable and is therefore not a title document.
Prepared by: shipping company
Air Waybill (AWB)
A kind of waybill used for the carriage of goods by air. This serves as a receipt of goods for delivery and states the condition of carriage but is not a title document or transferable / negotiable instrument.
Prepared by: airline
House Air Waybill (HAWB)
An air consignment note issued by an air freight agent to provide the cargo description and records. Again, it is not a title document.
Prepared by: forwarding agent
Shipping Guarantee
Usually a pre-printed form provided by a shipping company or the bank, given by an importer's bank to the shipping company to replace the original transport document. The consignee may then in advance take delivery of goods against a shipping guarantee without producing the original bill of lading. The consignee and the importer bank will be responsible for any loss or charges occurred to the shipping company if fault is found in the collection. It is usually used with full margin or trust receipt to protect the bank's control to the goods.
Prepared by: importer's bank / shipping company / consignee
Packing List (sometimes as packing note)
A list providing information needed for transportation purpose, such as details of invoice, buyer, consignee, country of origin, vessel / flight date, port / airport of loading, port / airport of discharge, place of delivery, shipping marks / container number, weight / volume of merchandise and the fullest details of the goods, including packing information.
Prepared by: shipper
Financial Documents:
Documentary Credit D/C
A bank instrument (issuing or opening bank), at the request of the buyer, evidencing the bank's undertaking to the seller to pay a certain sum of money provided that specific requirements set out in the D/C are satisfied.
Prepared by: the issuing bank upon an application made by the importer
Standby Credit
An arrangement between a customer and his bank by which the customer may enjoy the convenience of cashing cheques, up to a value. Or a credit set up between the exporter and the importer guaranteeing the exporter will pay the importer a certain amount of money if the contract is not fulfilled. It is also known as performance bond. This is usually found in large transactions, such as crude oil, fertilizers, fishmeal, sugar, urea, etc.
Prepared by: exporter / issuing bank
Collection Instruction
An instruction given by an exporter to its banker, which empowers the bank to collect the payment subject to the contract terms on behalf of the exporter.
Prepared by: exporter
Bill of Exchange (B/E) or Draft
An unconditional written order, in which the importer addressed to and required by the exporter to pay on demand or at a future date a certain amount of money to the order of a person or bearer.
Prepared by: exporter
Trust Receipt (T/R)
A document to release a merchandise by a bank to a buyer (the bank still retains title to the merchandise), the buyer, who obtains the goods for processing is obligated to maintain the goods distinct from the remainder of his / her assets and to hold them ready for repossession by the bank.
Prepared by: importer
Promissory Note
A financial instrument that is negotiable evidencing the obligations of the foreign buyer to pay to the bearer.
Prepared by: importer
Government Documents
Certificate of Origin (CO)
This certifies the place of manufacture of the exported goods to meet the requirements of the importing authorities.
Prepared by: Trade and Industry Department and five Chambers of Commerce [1]
Certificate of Origin Generalized Systems of Preferences (GSP) Form A (or as Form A)
A CO to support the claim for preferential tariff entry (a reduced or zero rate) of the exporting country's products into the GSP donors under the GSP they operate. In general, a Form A is issued only when the goods concerned have met both the origin rules of the preference receiving country as well as the origin criteria of the respective donor country's GSP.
Prepared by: Trade and Industry Department and five Chambers of Commerce
Import / Export Declaration
A statement made to the Director of Customs at port of entry / exit, declaring full particulars of the shipment, eg. the nature and the destination / exporting country of the ship's cargo. Its primary use is for compiling trade statistics.
Prepared by: exporter / importer
Import / Export Licence
A document issued by a relevant government department authorising the imports and exports of certain controlled goods.
Prepared by: Trade and Industry Department, Customs & Excise Department, etc
International Import Certificate (IIC)
A statement issued by the government of country of destination, certifying the imported strategic goods will be disposed of in the designated country. In Hong Kong, it is issued only to meet an exporting country's requirement.
Prepared by: Trade and Industry Department
Delivery Verification Certificate (DVC)
A statement issued by the government of country of destination, certifying a specific strategic commodity has been arrived in the designated country. In Hong Kong, it is issued only to meet an exporting country's requirement.
Prepared by: Trade and Industry Department
Landing Certificate
A document issued by the government of country of destination, certifying a specific commodity has been arrived in the designated country. In Hong Kong, it is issued by the Census and Statistics Department. Application requirements include letter stating the reason for the application, import declaration & receipt; bill of lading, sea waybill & land manifest; supplier's invoice; and packing list (if any).
Prepared by: Census and Statistics Department
Customs Invoice
A document specified by the customs authorities of the importing countries stating the selling price, costs for freight, insurance, packing and payment terms, etc, for the purpose of determining the customs value.
Prepared by: exporter
Source:
http://hong-kong-economy-research.hktdc.com/business-news/article/Small-Business-Resources/Common-Import-Export-Documents/sbr/en/1/1X000000/1X006MLL.htm
About Logistics
Q: What is a freight forwarder?
A: Freight forwarding is a service used by companies that deal in international or multi-national import and export. While the freight forwarder doesn’t actually move the freight itself, it acts as an intermediary between the client and various transportation services. Sending products from one international destination to another can involve a multitude of carriers, requirements and legalities. A freight forwarding service handles the considerable logistics of this task for the client, relieving what would otherwise be a formidable burden.
Freight forwarding services guarantee that products will get to the proper destination by an agreed upon date, and in good condition. The freight forwarding service utilizes established relationships with carriers of all kinds, from air freighters and trucking companies, to rail freighters and ocean liners. Freight forwarding services negotiate the best possible price to move the product along the most economical route by working out various bids and choosing the one that best balances speed, cost and reliability.
A freight forwarding service generally provides one or more estimates to the client along with advisement, when necessary. Considerations that effect price will range from origin and destination to special requirements, such as refrigeration or, for example, transport of potentially hazardous materials. Assuming the client accepts the forwarder’s bid, the freight is readied for shipping. The freight forwarding service then undertakes the responsibility of arranging the transport from point of origin to destination.
One of the many advantages of using freight forwarding is that it handles ancillary services that are a part of the international shipping business. Insurance and customs documentation and clearance are some examples. As a consolidator, a freight forwarding service might also provide Non-Vessel Operating Common Carrier (NVOCC) documentation, or bills of lading. Warehousing, risk assessment and management, and methods of international payment are also commonly provided to the client by the freight forwarding service.
A good freight forwarding service can save the client untold time and potential headaches while providing reliable transportation of products at competitive rates. A freight forwarding service is an asset to almost any company dealing in international transportation of goods, and is especially helpful when in-house resources are not versed in international shipping procedures.
Q: Why are the shipping rates so volatile?
A: While there are several factors involved, the primary is market demand. Traditionally from Dec through April for imports, especially from Asia to the U.S., it is called the “slow season.” Because the retail market slows down after Christmas. However from mid January through early February there is an upsurge of cargo moving to beat the Chinese New Year deadline whereby factories all over China shut down for weeks. This usually keeps rates high as there is always space problems for cargo getting on vessels. From May through November this would be the “peak season” where there is a big demand for cargo moving into the U.S., so the Carriers raise the rates during this period, with the GRI (general rate increase), and PSS (peak season surcharge).
Another factor is fuel, or what is called the Bunker Fuel factor. This is a floating surcharge that the Carrier’s can change when oil prices rise or fall. It is called the BAF.
Another factor is when the Carrier has increases in costs such as when Terminal costs rise, especially with Unions, congestion problems, etc. Or when the U.S Rail costs increase for similar reasons. This is where the Carriers can add in new surcharges which have happened in the past and eventually get absorbed into the “all in ” rate quoted.
Most recently the primary reason for rate increases, was a knee jerk response to the tremendous downturn in traffic and volume as a result of the current U.S. recession since ’08. This downturn caused many carriers to lose about 50% of their previous volume and while their costs remained the same or higher, and their revenue all but disappeared, they found themselves the beginning of this year looking at an average of $500, 000,000 in losses per Carrier. So from late ’09 until May of ’10, most Carriers put a large portion of their fleet out of commission off the coast of Singapore. Thereby creating a vessel shortage, or a false space problem. This gave them all excuse to raise their rates again, in order to salvage their businesses. This type of thing is not normal.
See our Blog post about the dramatic rate increases during early 2010.
Q: What are the usual methods of freight payment?
A: Most freight payments are done with a Company check. However you can also pay with wire transfer or credit card (subject to administrative fee). Payment is sent right around the time the freight is due to arrive, clear customs and be released.
Q: Can I get payment terms?
A: Yes. You would fill out a credit application that we would send you ahead of time, with all necessary banking information and references. Once your credit is approved, you would be granted the appropriate credit amount and length of time.
Q: What can I do to prevent delays and ensure a smooth process of the shipment?
A: Firstly, make sure your supplier overseas (on imports) or if you are the supplier for an export shipment, creates all of the necessary documents correctly (packing lists, commercial invoice, original bill of lading-OB/L) and in a timely fashion, so that all documents are provided with the necessary banks and sent to you (the importer) or your buyer-consignee on the B/L (if you are the exporter) at least 1 week before cargo arrives the destination so that everything can be processed through customs ahead of schedule and freight can be paid along with presentation of the original B/L. One factor that usually slows this process down is when there is discrepancies between the buyer and supplier and since the goods are not paid for, the OB/L has not been surrendered by the Supplier to the Consignee (buyer)
Q: Can I get cargo released without presentation of the OB/L?
A: This can be a touchy subject, as you may be a long time importer with a long time relationship with a particular supplier overseas, however a situation arises and for whatever reason you have not paid your supplier because they were supposed to give you credit, but there was a misunderstanding, they are not honoring the agreement, the next thing you know the cargo arrives and if you don’t get it released it goes into demurrage and or you may lose your customer because they have a deadline, and so on. So you desperately need that cargo released. So the ONLY way this can happen WITHOUT the OB/L is to somehow settle the matter with the supplier, get them to authorize the release in writing to the shipping agent in the port of origin, or direct to the U.S. Office that is holding the cargo. This can act in Lieu of an OB/L. This is no other legal way or one that doesn’t jeopardize the liability of the shipping company to be sued by the supplier if they release without their written consent.
Q: What are your Terms and Conditions?
A: Click Here to download a PDF document of our Terms and Conditions
Q: Any advice for a first time shipper?
A: We have 5 tips for you.
Tip #1: Save container transport cost by preparing to load your container in less less than 2 hrs.
When the driver shows up to your site, the first 2 hours are included in your fees. We recommend staffing up and preparing in advance to load the container as quickly as possible to avoid overtime charges.
Tip #2: Prepare Shipping Container Contents for Extremes
Containers are subject to extreme conditions. There are wild swings in temperature and humidity inside the container – they go through the Panama Canal and sometimes around the Cape. Containers are subjected to triple digit heat and humidity to sub-zero temperatures while in storage or in transport.
Tip #3: Carefully Declare ANY Organic Cargo
Plants, Edible Plants, Vegetables and Fruit are all treated differently depending on the origin and destination of the shipment. If customs finds any undeclared organic cargo, the can quarantine your container and charge you daily holding fees.
Tip #4: Properly Insure Your Cargo
Plan for “attrition”. All of the contents don’t always make it all of the time.
There will be some “attrition” – containers get inspected, sometimes by unscrupulous dock/deck hands…this isn’t REALLY considered stealing, as the items in transit, technically are the property of the shipping company*. See our blog entry on securing, insuring and properly declaring your container contents to manage risk of inspection, suspicion, mistakes and “attrition”.
Tip #5: Understand that Freight Forwarding is both an art and a science.
Many companies and handlers are involved in moving your container, here are just a few possible examples: Trucking company(ies) outbound (your door to the port of origin or train yard), Crane Operations transferring container from truck to train, and train to ship. That’s just to get the container to the ship, then the reverse happens on the other side…it’s a REALLY rough ride, even in good weather.
Q: Can you offer more information on customs’ codes?
A: Yes, please follow this link:http://www.cbp.gov/xp/cgov/trade/automated/automated_systems/ams/camir_intermodal/appendices/
Q: Can you tell me the seaport code for my shipment?
A: Yes, please follow this link: http://www.photius.com/seaports/
AIR CARGO FAQSIZE & WEIGHTQ: Does size matter for air shipment?
A: Yes, air freight is based on both the actual weight and changeable weight of the cargo.
Q: How is changeable weight calculated?
A: There is a special formula.
Just give us all three dimensions and we will calculate the chargeable weight for you.
Q: What is the maximum size or weight?
A: This varies depending on the airline so please ask us.
As a rule of thumb, maximum normal cargo dimensions: 120x80x60in.
As the weight and size increase so will the cost. If your cargo is oversized or requires special handling, ask us about special rates.
PICK UP & DROP OFFQ: Do you have warehouse where I can drop off the cargo?
A: Yes, we have receiving warehouse near all major airports.
Please let us know your cargo location and we will advise you the closest receiving warehouse.
Q: How and where can we pick up the cargo at destination?
A: We will provide you with the necessary paperwork for custom clearance, once custom is done, you can go to the warehouse to pick up the cargo.
We also advise you to check with destination custom prior to shipment departs, just to make sure if there’s any special rule & regulation at destination for certain commodities
Q: Do you have office at destination who can help us?
A: Yes, we have a lot of agents who we work with at different location.
Please check with us, they will be able to help you for any destination services.
Q: Can you handle door delivery at destination? Can you handle pick up from residential area?
A: Yes, please help to provide us your door address, and we will check the cost for you
CHARGESQ: What are some of the destination charges?
A: There may be airport fees, warehouse fees, custom clearance charges, duty/tax and door delivery charges.
Of course, if your cargo is chosen for custom exam at destination, please prepare to home charges and delays for getting the cargo.
Q: What’s the best way to save money on air freight?
A: Ship only the most important items, pack in as small of a box, crate or pallet as possible.
If you can route from/to a major hub (JFK, LUH, BJS) instead of a smaller airport, this may help to lower your freight rate.
Q: Can I pack my items in suitcases, bags or plastic bins?
A: No, the airlines will reject any cargo that is not properly packed. Must be packed in a box, crate, or on a pallet. If there are any oversized items or cargo requiring special packing, please ask.
Q: What is typically transit time?
A: Airport to airport 3-5 days on average. Door to door varies depending on customs clearance, estimate 5-7 days.
Delays and/or changes to schedules can happen. Best way to make the cargo ship as quickly as possible is to make sure all paperwork is properly filed before hand, this eases the customs process.
Q: Are there types of cargo that cannot be shipped via air freight?
A: Yes, anything hazardous, flammable, dangerous, chemicals, computer batteries, live animals, perishable items, etc.
Q: What kind of paperwork I will need to fill out ahead of time?
A: We will send you some paperwork for you to fill out the basic information, Such as shipper and receiving party contact information.
Don’t worry, we will take care of all the export custom and paperwork for you.
Source:
http://www.universalcargo.com/FAQs/