In the international trade industry, getting export and import customs clearance is one of the prime points of concern for every trader. Any hiccup or hindrance in completing this formality can cost one more than a delay in shipment.
Customs services entail a bucket full of conventions that the exporters must comply with. Every document must be accurate and verifiable to the best of one’s knowledge. To avoid the stress and headache that this process involves, most of the traders intend to hire the best service providers available in India.
The CHAs (Customs House Agents) work in this field to guide the traders in the documentation and other things demanded by the customs services. Once the customs department completes the verification process and stamps the seal of approval on the paper, the traders are good to go with the freight shipment.
Although a trader must avail of help from a third party to complete the customs services, he should himself have the basic knowledge of all the legal paperwork. After all, a well-informed businessman always enjoys a safe place in the industry.
The customs services department needs to accept and approve of every document submitted by the traders.
Mandatory Requirements for Customs Clearance
There are three mandatory documents that an exporter has to submit to the customs services department.
1. Customs Invoice
The customs invoice enlists all the details of the consignment including selling price, packaging costs, description, volume or weight of the goods, quantity, terms of delivery, payments, insurance, etc. This invoice is the first document that the customs services department demands. A representative will match and verify all the details and then declares whether the consignment will get an allowance or not.
2. Export License
Every exporter has to obtain an export license before starting his trade business. Although one does not need to physically produce the license at the time of every export, the license number is used in making invoices and for getting customs clearance.
3. Shipping Bill
The shipping bill is the major document that an exporter needs for getting the final approval from the customs services department. There is a lot of paperwork involved in this formality. An experienced CHA can offer effective help in preparing this bill and forwarding the application.
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Payment Requirement for Customs Clearance
For furnishing the proof of payments of the shipment, the customs services department asks for two documents.
1. Bill of Exchange
The Bill of Exchange is somewhat similar to a promissory note that the banks or individuals accept as a claim of payment. The exporters take this document from their buyer specifying a defined time of clearing the dues.
2. Letter of Credit
In the case of freight shipments that are on credit, the exporters demand a letter of credit from the importer. The latter passes this document through his bank and legally states when and how he will pay the liable amount.
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Shipping Requirement for Customs Clearance
As a preliminary requirement of a freight shipment, an exporter needs to submit three documents to the customs services department.
1. COO (Certificate Of Origin)
The certificate of origin is a legal paper that specifies the country of origin of the goods. This document facilitates transparency between the buyers and sellers. Also, it is vital to know that the exporter has not retrieved the goods through any illegal source.
2. Bill of Sight
There are times when the importer is not well-aware of the nature of the goods that he has demanded to import, and the exporter also does not have sufficient information regarding the same. In this case, the exporter furnishes the Bill of Sight that will permit the receiver to inspect the goods before making the payment.
3. Bill of Lading
The Bill of Lading is another crucial document that an exporter has to avail and then submit to the customs department. This bill is a kind of contract between the carrier/shipper and the exporter.
Quality Check Requirements for Customs Clearance
Every cargo goes through a quality check before it is ready for shipment. The documents that claim that the goods are exportable need to be submitted to the customs services department.
1. Proforma Invoice
The proforma invoice is similar to a “Purchase Order” as it specifies the terms of shipment and the number of goods that both the parties have agreed to in the deal.
2. Customs Packing List
The customs packing list consists of all the details related to the quantity and quality of the shipment. The customs services department evaluates this list to cross-verify whether the items in the cargo are accurate or not.
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For Food Essential Goods
If an exporter is shipping any kind of items that are ready for consumption, he has to get a certificate from a recognised health organisation. This document certifies the quality of the goods.
Customs clearance is the most important gateway that the traders need to cross twice for a successful shipment. The logistics service providers serve as an immense help in completing the formalities related to customs services. A trader should get help from the best one possible!