1

Export Documentation and

Compliance

Presented by: Bengt Reed Anderson, CESPresidentBDG International, Inc.

Tel: 847-760-0000 Fax: 847-760-0005www.bdginternational.com

sales@bdginternational.com

EXPORT DOCUMENATION AND COMPLIANCE

TopicsDocumentation Quoting

Terms and Conditions

Type of Payment

Incoterms

Purchase order Type of invoices Packing List Haz Mat info Carnet Other export –C/O

Bill of Lading

Documentation Freight Forwarding

Insurance and Risk

2

Quoting

QuotationsHow will you sell (EXPORT) your product?

IMPORT – is the opposite benefit.

Prepaid or Collect– Collect More Expensive

Forwarder assumes political, international risksForwarder converts collect $ to local currency

– Collect Less ControlConsignee routes shipments

– Prepaid Less ExpensiveNo political risk, international risksForwarder bills shipper in $.

– Prepaid More ControlShipper selects forwarder.L/C's shipper wants control.

Quotations cont...Choose your incoterm now

Be clear and thorough in you quotations.

Lead Times - How long will it take to produce the product?– Changes in production costs.– Changes in transportation costs.Add to freight charges 5-10%Forwarder can bring up invoice.

Quotation Standards– Use Metric when possible.

Use Other currencies to make the sale.

3

Quotations cont...

Transportation, what should be quoted?1. Commodity Description2. Origin/Destination3. Shipment Size:

Pieces, Weight & Dimensions4. Freight Charges:

Prepaid or Collect 5. Method of payment:

Letter of Credit, Sight Draft, Open Acct.6. Terms Of Payment

Incoterm, i.e.: CIF, CPT, DDU, Ex Factory7. Insurance Required:

Value of Product8. Services Required

Transit Time, Frequency9. Approximate Shipping Date

Did you agree on Incoterms?

INCOTERMSAn incoterm = International Commercial Terms

Since 1936 / revised 6 times

Most recent revision Incoterms 2000 Incoterms 2010 expected late in 2010

The governing term of sale and it's source should be clearly specified in all quotations and purchase orders“

http://www.iccwbo.org/incoterms/id3045/index.html

4

Incoterms

ICC Incoterms

Advantages Creation of an

international body. Perceived as neutral.

Defined and understood in major trading languages.

A given term is used in one context.

Failings of the U. S. Terms

– Implies American bias – Not widely translated,

not understood– 50 years old, no

updates, do not reflect current commercial and transport practices

– FOB -- overused– All other countries use

Incoterms

Incoterm Definitions

Carriage Paid ToCPT

Carriage and Insurance Paid To

CIP

Cost, Insurance and Freight

CIF

Delivered Duty Paid

DDPCost and FreightCFR

Delivered Duty Unpaid

DDUFree CarrierFCA

Delivered At Frontier

DAFFree On BoardFOB

Delivered Ex QuayDEQFree Along SideFAS

Delivered Ex ShipDESEx WorksEXW

Incoterms

Terms to Know EXW Ex-Works (Named Origin)

FCA Free Carrier (Named Port)

CPT Cost Paid To (Named Destination Port)

CIP Cost, Insurance Paid To (Named Destination Port)

DDU Door Delivery Duty Unpaid

DDP Door Delivery Duty Paid

5

Incoterm Syntax

DDU Suwon, Korea>DDU (named delivery city)

CIP Seoul, Korea, Kimpo Airport>

CIP (named port or airport of entry)

FCA Chicago O'Hare Airport>

FCA (named port or airport of departure)

Ex Works Milwaukee, WI>Ex Works (factory city location)

Usage and Syntax Examples:

Incoterms 2000

DDP

DDUDDPDDPDEQ

DAFDDUDDUDESD - Named Door

CIPCIPCIPCIF

CPTCPTCPTCFRC - Named Destination Port

FOB

FCAFCAFCAFASF - Named Origin Port

EXWEXWEXWEXW-E - Named Origin Door

Truck/RailAir Ocean FCL/RoRo/LCL

Ocean Breakbulk / LCL

Delivery Point

Incoterms 2000 a

CCCCCCCCCCCCCUnload from On-Carrier

SCCCCCCCCCCCCDestination Duty & Fees

SCCCCCCCCCCCCImport Clearance (License)

SCCCCCCCCCCCCNominate Import Broker

SSCCCCCCCCCCCLoad On Carrier

SSCCCCCCCCCCCArrange On-Carrier

SSCCCCCCCCCCCNominate On-Carrier

SSSCCCCCCCCCCUnload Main Carrier

SSSSSCCCCCCCCStow Main Carrier

SSSSSSSCCCCCCArrange Insurance

SSSSSSSSSSCCCLoad Main Carrier

SSSSSSSSSSCSCUnload Pre-Carier

SSSSSSSSSCCCCNominate Forwarder

SSSSSSSSSCCCCNominate Main Carrier

SSSSSSSSSSSSCLoad Pre-Carrier

SSSSSSSSSSSSCArrange Pre-Carriage

SSSSSSSSSSSCCHarbor Maintenance Fee

SSSSSSSSSSSSSExport Clearance (License)

SSSSSSSSSSSSSMark and Label

SSSSSSSSSSSSSExport Pack

DDPDDUDEQDESDAFCIPCIFCPTCFRFOBFCAFASEXWLogistics Event

6

Incoterms 2000 b

SCCCCCCCCCCCCEntry Documents

SSCCCCCCCCCCCOn-Carriage Bill of Lading

SCCCCCCCCCCCCImport License

SSSSSSCSCCCCCInsurance Certificate

SSSSSSSSSSSSCDock Receipt

SSSSSSSSSCCCCMain Carriage Bill of Lading

SSSSSSSSSSCSCOther Governmental

SSSSSSSSSSCSCExport License

SSSSSSSSSSSSCPrecarriage Bill of Lading

SSSSSSSSSSSSSCertificate of Origin

SSSSSSSSSSSSSExport Declaration

SSSSSSSSSSSSSPacking List

SSSSSSSSSSSSSCommercial Invoice

DDPDDUDEQDESDAFCIPCPTCIFCFRFOBFASFCAEXWDocumentation Event

What are your Terms and Conditions?

???

What are your customers Terms and Conditions?

Terms and Conditions between seller and buyer

Between the buyer and the seller there should be some type of understanding regarding the conditions of purchase.

defines the terms and conditions of the purchase.

include any type of marking, packing, and shipping requirements.

designate liability for each party and hold that party responsible.

define government regulations and hold the shipper responsible for any illegal conduct, breach of security or acts against the regulations

reduces amount of questions if an order is placed

7

Terms and Conditions between seller and buyer cont’

The standard terms and conditions where you, the buyer, are contracting w /a seller in the course of a business to business transaction, and includes the following basic items:

price and payment warranty

delivery sub-contracting

samples title and risk

packaging inspection

testing indemnity

confidentiality termination

terms of shipping government regs

Did you agree on the Type of Payment?

Payment TypesCash in advance: International Payments

are sent via Wire Transfer or Draft

In a CIA situation it is preferable to receive the payment prior to production or organizing the order.

Provide your “ Shipment Ready Date” based on when you will receive $

CIA - ship prepaid and receive the payment for transportation/ prevent cargo possibly sitting at a port and being liable for the return.

Open Account: Customer that has

gone through a credit analysis

They have agreed to pay in 30 – 60 days net from invoice date.

Normally an ongoing customer which orders frequently

Important to agree on incoterms

Watch payment terms versus when they orders ready.

8

Payment type / Terms

Sight Draft Funds transferred upon sight of

documents at the applicant bank.

Time Draft Funds transferred upon # days after

sight of documents at the applicant bank

Payment Type Cont’

Letter of Credit

This is a legal instrument that designates exact terms of the shipment process and when the payment will be made.

Contractual agreement between Shipper (Beneficiary), Consignee (Applicant), Beneficiary Bank and Applicant Bank

Types: Revocable

Irrevocable

Confirmed –Guaranteed by advising bank

Non Confirmed –Guaranteed to be pd by

advising bank

Spells out the legal obligations of each party

Letter of Credit Flow Chart

9

Chart Guide: Letter of Credit (L/C) Flow

1. Sales Contract between Exporter & Importer is opened.

2. Importer Request L/C with Issuing Bank

3. Issuing Bank sends Original L/C to Advising Bank

4. Advising Bank sends Original L/C to Exporter

5. Exporter books shipment with BDG & sends Original L/C to BDG for banking. BDG arranges transport of goods.

6. BDG prepares all documents per L/C & sends back to Advising Bank with the Original L/C.

7. Advising Bank confirms documents in order, forwards documents to Opening Bank and arranges payment to Exporter.

8. Opening Bank releases original shipment documents to the Importer .

Letter of Credit Flow Chart

CarrierGoods Goods

Transport Document

254

Advising / Confirming

Bank

1

Exporter / Seller /

Beneficiary

Importer / Buyer /

Applicant

Opening / Issuing Bank

3

7$

7

8

6

L/C Suggestions1. The Letter of Credit shall be irrevocable

2. The credit shall be__advised by ____________________________confirmed by __________________________

____________________________________________________

3. The credit shall be payable at the counters of:________________________________________________________________________________________________________

4. The credit shall show as the beneficiary:

5. The credit shall be payable in USD, in the amount:___ not to exceed $___________________ exactly $___________________ about $ _______________

10

L/C 26. The credit shall be payable:

__ at sight__ ____ days sight upon presentation at the counters of the bank stated in

item #3 above.__ _____ days from ___________ date.

7. The Letter of Credit __ shall be transferable.__ shall not be transferable.

8. The credit shall show that all banking charges incurred are for the account of the applicant.

9. The credit shall show that all charges for amendments to the credit, including related communications expenses, are for the account applicant.

10. Partial shipments __ shall be allowed.__ shall not be allowed.

11. Transshipments __ shall be allowed.__ shall not be allowed.

12. The credit shall allow for required transport documents dated no later than ___________________.

13. The credit shall allow for a minimum of 21 days after the required transport documents date for the presentation of documents at the counters of the bank stated in item #3.

L/C 314. The required documents should include:

A) __ Commercial invoice totaled _______________________(Inco Term) (Destination) (Amount)

B) __ Commercial invoice shall cover__ Pro-Forma invoice#________________________ __ the following: ________________________

C) __ Packing List for above.__ Insurance certificate showing insurance/provided by

seller.

D) ___ Ocean Bill Lading___ The bill shall be consigned:

___ to ___________________________________ to the order of ________________________________

E) ___ The credit shall allow for NVOCC Bills of Lading.F) ___ The Bill of Lading shall be marked "ON BOARD".

G) __ Air Waybill shall be consigned:__ to ___________________________ to the order of _________________________

The buyer is ready to place an order.

11

Purchase Order

Receive a Formal Purchase order Try to refrain from the simple email and

have standards on what the P.O. order should include.

How will you receive payment?

Purchase Order

ISSUE A PURCHASE ORDERor

REQUIRE A PURCHASE ORDER

A purchase order is a formal agreement to buy that specific order. Repeat some information from the Terms and Conditions Define exactly what is being ordered that day Define how it will be shipped (Air or ocean) Define when it needs to be shipped and when it is expected at dest Designate the freight forwarder / shipping responsibility A calculation of quantity and price that will be ordered Take the questions out of the order and ensure success

Shipment process

While preparing the order

1. Prepare/Review the export documents2. Prepare/Review the packing for export3. Re-verify payment process is in place,

regulations for foreign country, and Denied Parties verification

http://www.bis.doc.gov/dpl/default.shtm

12

Export Documentation

DocumentationDocuments Requires for Export - ShipperAir Freight Shipments (export)

• Security Endorsement Form –•Signed form, indicating that there are no explosive devices within your air shipment.

• Complete a Letter of Consent for Screening of cargo• Work with your forwarder to become a Known Shipper

Air and Ocean Shipments (Import and export)• Commercial Invoice• Packing List

•Information should include: Contact person, Phone/Fax number, List box numbers with contents in each box. This is very important for insurance purposes.

• SLI (Shipper’s Letter of Instruction)• Letter of Credit (If Issued)• Other Documents: Health Certificates, C of O

Types of Invoices

Proforma Invoices versus Commercial Invoice

13

What is a Pro Forma Invoice?

In trade transactions, a pro forma invoice is a document that states a commitment from the seller to sell goods to the buyer at specified prices and terms. It is used to declare the value of the trade. It is not a true invoice, because it is not used to record accounts receivable for the seller and accounts payable for the buyer.

A 'Proforma Invoice' is Confirmed Purchase Order where buyer and Supplier agrees on the Product Detail and its cost (usually-Supplier currency) to be shipped to buyer. Sales quotes are prepared in the form of a pro forma invoice which is different from a commercialinvoice. It is used to create a sale and is sent in advance of the commercial invoice. The content of a pro forma invoice is almostidentical to a commercial invoice and is usually considered a binding agreement although the price might change in advance of the final sale.

Pro Forma Invoice

• Banks usually prefer a pro forma invoice to a quotation for establishment of a letter of credit or for advance payment by the importer through his bank.

• In some countries, customs may accept a pro forma invoice (generated by the importer and not the exporter) if the required commercial invoice is not available at the time when filing entry documents at the port of entry to get goods released from customs.

Commercial Invoice

Buyer / Importer will pay off this invoice.

Official document for export and import clearance

Customs clears freight using commercial invoices.

Banks transfer money using the Commercial Invoice.

14

Commercial Invoice Elements

Sold To, Ship To, Notify Party

Terms of Payment

Incoterm of Sale

Certified True and Correct

Destination Control Statement

Country Of Origin

Product Description (Use layman terms along with marketing terms)

DESTINATION CONTROL STATEMENT (DCS)

DCS (EAR 758.6)- Must be entered on your invoice- Must be on the bill of lading / AWB- other export control documentation

These commodities, technology or software were exported from the U.S. in accordance with the EAR diversion contrary to U.S. law is prohibited.

"ULTIMATE DESTINATION"- Required for all exports on the Commerce Control List- Not Required for EAR99, unless BAG or GFT

15

Packing List

Packing List

Packing List

Itemized list of articles usually included in each shipping package, giving the quantity, description, and weight of the contents. Prepared by the shipper and sent to the consignee for accurate tallying of the delivered goods.

Also called bill of parcels, packing slip, or unpacking note. (International Business uses Packing List)

Per businessdictionary.com

Export Packing and Labeling

What type of products do you ship?– HazardousGet professional training NOW!Get your organization registered with the US DOT.

– FragileLabel Accordingly: Keep Upright, FragilePack for a lot of handling

– PerishableLabel Accordingly

16

Export Packing and Labeling

What should data should appear on the label?

– 1. Consignee Name, address– 2. Contact person– 3. Phone Number/Fax number– 4. Consignee Reference Number, L/C Number, or

other number.– 5. Country of Origin (USA)– 6. Piece#/Total box count, i.e.: 1/10, 2/10, 3/10– 7. Box Weight8. Handling Instructions

Other Export Documents

There are a multitude of specific documents that may be required,

but in general a Certificate of Origin is the most common.

Certificate of Origin Document that certifies a shipment's country of origin.

It is used between members of a trading block or where special privileges are granted to goodsproduced in certain countries.

Certificate of origin is commonly issued by a trade promotion office, or a chamber of commerce in the exporting country. Also called declaration of origin.

Freight Forwarder can Notarize and Chamber stamp the C of O

Per businessdictionary.com

17

Duty Preferences and Free Trade Agreements

DUTY PREFERENCESDUTY PREFERENCES

The WTO and main Parliaments of each country come together to decide on countries with special needs, and economies that need to be promoted.

The U.S. Congress / Senate approve Trade Agreements, Trade Acts, Global Trade Decisions, and requests for specific Industry or Commodity duty preferences.

The Office of U.S. Trade AgreementsThe Office of U.S. Trade Agreements

The U.S. trade strategy is to pursue muliple market-opening initiatives on a global, regional and bilateral basis, establishing models of success that can be used throughout all negotiations.

18

DUTY PREFERENCESDUTY PREFERENCES

The duty will be based on a product as per the General Rules of Interpretation from the U.S. Regulations & Harmonize Tariff System

Commodity: - Type - Material- Usage- Country of Origin- Government Restrictions- Government Free Trade Agreements

Though the system works the same on import and export, the duty pricing can be completely different.

Trade AgreementsTrade Agreements

- USA has provided many countries and commodities a low duty rate or free.

- Trade Agreements not only provide our importers lower duty rates, but more importantly help our exporters compete in a global economy.

- Due to the multiple layers of Trade Agreements and Free Trade Agreements many importers can import from developing countries – duty free.

- However, these same countries that benefit from our low or free duty status do not reciprocate and provide our exporters duty free status into their country.

- Trade Agreements assist US Exporters to sell their product in the foreign country.

Free Trade Agreements

AustraliaBahrainCAFTA-DR Costa Rica, Dominican

Republic, El Salvador, Guatemala, Honduras, and Nicaragua.

ChileIsraelJordanMorocco

NAFTAOmanPeruSingaporeColombia - PendingKorea - PendingPanama - Pending

19

Foreign Government Inspections prior to export

Hazardous Materials / Chemicals

20

Haz MatAir Department of

Transportation (DOT) International Air

Transport Administration (IATA)

Candy stripe DG form MSDS and TDS sheet

(Material Safety Data Sheet and Technical Data Sheet)

http://www.iata.org/whatwedo/cargo/dangerous_goods/

Ocean Department of

Transportation (DOT)

International Maritime Dangerous Goods (IMDG)

There is not an official form

MSDS and TDS are now required for quoting from most ocean lines

http://www.imo.org/Safety/mainframe.asp?topic_id=158

Providing Instructions

To the designated freight forwarder

Shipper's Letter of Instruction (SLI)

The SLI is a multi-function form.

• EEI (Electronic Export Information ) • Provides information to complete

Automated Export Declaration (AES)• Proper authority to the AES agent• Detailed instructions to the forwarder

21

SLI, or EEI information

EEI = Electronic Export Information Can be provided in many ways – the most

common is via a shipper’s letter of instruction which also acts as an instruction sheet for shipping purposes.

SLI / EEI

22. Schedule B #Number that associates the product with the U.S. Govtclassification system

21. D/F

Is the product “Made in the USA” or of foreign origin?

17. Hazardous Materials

Yes or no

19. Routed:

Yes or no

7. Country of Ult DestDo you have knowledge of the final destination beyond your deliver to address?

6. Point (state of origin)Where is the cargo physically coming from?

4b.Intermediate cneeReceiving the cargo and on fwd – not a freight frwrdr

4a. Ult cneeCompany who is receiving the cargo

1c.Parties RelatedIs USPPI or FPPI related 10% or more?

1b. USPPI EIN-Required information

1a.USPPI-Company responsible for shipping the product from the USA

22

SLI / EEI29.Authorized Employee to sign and provide the information

28. ECCN #

All goods have an ECCN # which is regulated by Dept of Commerce

27. License no or Exception

Do not assume a license is not required. Verify the information.

26. Value of goods

Must be the sell price, including any down payments

24. Shipping Weight

Must be in kgs

Proper Authority to AES Agent

Anyone can complete an AES declaration if they are authorized to complete the EEI information by the USPPI or FPPI

If the employee or agent does not have authority –this is a violationProvided by a Letter of Authority or Provided by a Power of Attorney or Signed SLI on Box 23

23

Carnet

*Passport for Cargo*

Carnets An ATA Carnet is an International Customs document (Admission Temporaire)

– Definition - Merchandise Passport Reduces Cost -

– Eliminates "VAT", Duties, and the posting of a Bond at the time of entry.

Simplifies Customs Procedures– A Temporary Exporter may use a single

document for all customs transactions

Carnets (continued) Facilitates Re-Entry

– U. S. Customs allows immediate entry of the product into the U.S.A

– Eliminates the need to register the product with customs prior to export.

Carnets do not cover:– Consumable Goods– Disposable Items

Carnets are accepted in 44 countries Security: A Bond is required to be purchased in

the U.S.A.

24

Carnets (continued)

Customs Claims and Penalties– Goods must be exported within 1 year.– Improperly validated Carnet sheets.– Improper or inadequate description of

merchandise on the "General List". Processing

– 5 Working Days– Expedited Processing at higher fees is

available.

Bill of Lading

Bill of Lading

Ocean Original or Express

bill of lading –negotiable document

B/L is a set of instructions to the carrier

MBL / HBL

OBL

Airfreight AWB (Air Waybill) is

not negotiable

AWB is a set of instructions

MAWB / HAWB

DAWB

25

Bill of Lading or AWB

Review the terms and conditions What are the carriers responsible for?

What are you hiring them to do?

Where do they start and end their responsibility?

M ARKS AND NUM BERS NO. OF PKGS

Declared Cargo Value US$

PLACE AND DATE OF ISSUE B/L NO.

BDG INTERNATIONAL, INC.AS AGENT FOR SEAGULL EXPRESS LINES

BY

AGENT FO THE CARRIER

In witness whereof the Carrier of his Agents have signed the number of original B/Ls stated below, all of this tenor or date.One Bill of Lading duly endorsed to be given up in exchange for the goods or for a delivery order for same upon which theothers

If the merchant enters the actual value of the goods and pays the applicable ad valorem rate, the carrier's package limitat ion will not apply

PREPAID COLLECTRECEIVED in apparent good order and condit ion except as otherwise noted the total number of containers or otherpackages or unit enumerated below (contents and condit ions of contents, measurement, weight , quant ity, brand, quality andvalue unknown, any re

These commodit ies, technology, or sof tware were exported f rom the United States in accordance with the Export Administrat ion Regulat ions. Diversion contrary to U.S. Law prohibited

PARTICULARS FURNISHED BY SHIPPER

DESCRIPTION OF PACKAGES AND GOODS GROSS WEIGHT M EASUREM ENT

PORT OF DISCHARGE FOR TRANS-SHIPM ENT TO PLACE OF DELIVERY BY ON CARRIER NO. OF ORIGINALS

EXPORT CARRIER (Vessel, voyage) PORT OF LOADING

PRE CARRIAGE BY PLACE OF RECEIPT BY PRE CARRIER

FOR DELIVERY BY ON CARRIER

NOTIFY PARTY POINT AND COUNTRY OF ORIGIN OF GOODS

CONSIGNEE FORWARDING AGENT (Reference)

EXPORT REFERENCES

SEAGULL EXPRESS LINESCOPY

BILL OF LADINGSHIPPER/EXPORTER BOOKING NUM BER BILL OF LADING NO.

Sample document

Insurance and Risk

26

Floating Containers

Fire on board

Crushed

27

Crash Landing

Insurance-Carrier Liability

Ocean Freight Carriage of Goods by Sea Act Limits recovery to

the lesser of the value of the cargo damaged or lost or $500.00 per CSU (Customary shipping Unit)

Air Freight - Warsaw Convention

Limits air carriers liability for loss or damage to cargo to the lesser of the values of the lost or damaged freight or $9.07/LBS

Domestic Carriage .50/LBS or

$50.00/Shipment

Insurance

• Documentation Required to file a claim.• 1) Signed copy of the Bills of Lading. When insurance is

purchased through BDG, BDG will obtain this document.

• 2) All inbound and outbound inspections of the trailer or container. Consignee must make the product available for inspection prior to use.

• 3) Copy of set of shipper’s commercial invoices and packing lists. When insurance is purchased through BDG, BDG will obtain this document.

28

Insurance

4) Proof of loss: Any documents listing the exceptions.• Obvious Damage: Consignee must indicate on delivery

receipt that damage or loss occurred. • Concealed Damage: Consignee must notify the

delivering carrier of the damage

5) Non-delivery: • Consignee must notify the shipper and carrier that the

product did not arrive as scheduled.

6) Claim notifications filed against carriers & acknowledgment from the carrier.

Insurance – Gen Avg

• General Average• Sharing of the

Risk among the participants of the voyage

• The vessel owner risked livelihood (vessel) as well as lives of captain and crew.

• General Average provides a way of spreading this risk.

• General Average is declared when...• Freight is jettisoned• The vessel sustains

damage• Corrective action is

taken at the expense of either the vessel owner or cargo owners.

General Average

•Calculations• Voyage Value = Vessel

Value + Total Cargo Value• Shipper Participation = % of

shipper cargo to Total Cargo Value

• Voyage Loss is determined• Shipper Participation is

applied to Voyage Loss• Shipper Participation is

submitted in form of a security deposit.

• Release of cargo can not be obtained until Security Deposit has been received.

• Release of cargo can take between 6 months and 2 years.

29

Insurance

• 2 Types of Insurance

• All Risks

• Free of Particular Average (FPA

Insurance

•All Risks• Most Comprehensive coverage• Insures everything except for...

• Improper Packing• Abandonment of Cargo• Failure to pay or collect accounts• Inherent Vice (Infestation, etc.)• Employee Dishonesty• Loss Amounts in excess of policy limits

Insurance

• All Risk exclusions

• Losses inland more than 30 days after discharge of cargo

• Losses in South America more than 60 days after discharge of cargo

• Barge shipments

• Goods subject to an on-deck B/L

• Losses caused by temperature or pressure

• Used goods

30

Insurance

All Risk exclusions– Failure to notify air carrier of a preliminary loss in a

timely fashionObvious damage 7 daysHidden damage 14 daysNon-delivery 120 days

– Failure to notify ocean carrier of a preliminary loss in a timely fashionLoss or damage 1 yearNon-delivery 120 Days

InsuranceFPA Coverage

Burning Sinking Stranding Overturn Explosion Collision Crash of Aircraft

Washing overboard Jettison Collision of truck Overturn of truck Collapse of pier General Average

Insurance"All Risks" vs. F. P. A.

"All Risks"– Includes coverage's afforded by F.

P.A.– Theft, Pilferage & Non-delivery

Covered– Rough Handling & Damage in

Transit– Door to Door

F.P.A.– Essentially a "Disaster Coverage– Typically, a major event must

occur to the vessel or airline for the loss to be covered.

31

Freight Forwarding

Who assists in understanding the rules Who assists in understanding the rules and regulations set forth by the and regulations set forth by the

governing parties?governing parties?

Government Help DesksInternational Attorneys

Freight ForwardersCustoms Brokers

International Freight ForwardersInternational Freight ForwardersAn agent for the exporter in moving cargo to an overseas.

“Travel Agent for Cargo”

Specializing in:

- the import rules and regs of foreign countries

- the export regulations of the U.S. government

- the methods of shipping, and the docs related to foreign trade

- Foreign to foreign moves

- Pricing and rate negotiation via all modes of transportation

- Agent for the Department of Homeland Security

- Track and trace cargo

- Resolve Challenges

32

Freight Forwarders & Customs Brokers

How to select a Freight Forwarder and Customs Broker

Typical costs associated with a Freight Forwarder and Customs Broker

Choosing your Forwarder• Selection: Select a company you can have a long term

business relationship with.

• Due Diligence: complete a credit check• Shipper liable for ocean freight, duties, etc.

• Control: Control your cargo. • If the buyer selects the forwarder, you are still liable for

compliance / Caveat Emptor.• You giving up control, and knowledge on how to ship to that

country. It will be harder to market your product to other companies.

• Many forwarders are not licensed and therefore must work with another forwarder to move the freight.

• You must give a POA or authority to a forwarder if you do not complete the SED.

Freight Forwarding Licenses / Certifications

IATA (International Air Transportation Association)

CHB (Custom House Broker)

FMC (Federal Maritime Commission)

NVOCC (Non-Vessel Operating Common Carrier)

C-TPAT (Custom Trade Partnership Against Terrorism)

MC (Motor Carrier – Truck Brokerage)

DG Certified (Dangerous Goods Certification)

33

CHB Certifications

CHB (Custom House Broker License)

ABI (Automated Broker Interface)

AMS (Automated Manifest System)

ACH (Automated Clearing House)

ACE (Automated Commercial Environment)

AII (Automated Invoice Interface)

RLF (Remote Filer - BDG can file entries at all US Customs Ports)

LOGISTICS SERVICES

Air Export Oversize, Hazardous, Perishables, General Cargo

Ocean Export: FCL, LCL, Break-bulk, Hazardous

Ocean & Air Import: FCL, LCL, Break-bulk, Hazardous, Perishables, General

Cargo

Foreign to Foreign Shipments

The Export Freight Forwarder

DOCUMENTATION

Documentary regulationsComplete export / import documentationAES - (Automated Export System)

L/C documentsLegalizationAWB and OBLC of OSGS DocumentationExport Compliance

34

The Import/Export Freight Forwarder

CONSULTATION

Knowledge of U.S. and world wide governmental restrictionsUnderstand Financial options: L/C's, and DraftsInsurance issuesTerms of Sale (Incoterms)

COMMUNICATION HUBFlight and Sailing informationPayment Status InformationOverseas PartnersPOD'sInspections for Insurance claims.

Routed Forwarders

Beware of Routed forwarders

– When working with a routed forwarder "Caveat Emptor"

– Forwarders come in all shapes and sizes. – Many forwarders are not licensed and therefore must work with another

forwarder to move the freight.

– You must obtain a Letter of Authority from buyer complete your own AES or provide EEI to forwarder.

Questions ??

35

BDG International, Inc.

Thank you for attending

today’s seminar !

Export Presentation Download:

www.bdginternational.com/exportforms/export_forms.htm