Import documents are legal documents registered by the importer or customs agent for the arrival of the goods when imported. It has another name called ‘bill of entry’.
A bill of entry is an essential document for customs clearance, where the document is submitted to the customs department.
If you are an importer, this blog might be a great help.
Let me explain its importance right below.
Importance of import documentation
This helps you to have a safe side when you import freights.
- To have a clean transaction process
- To manage your time well
- To have a payment protection
- To help you claim loss that happens
- To have a smooth custom clearance
- To avoid document complication
- To avoid unnecessary delays
- To have a successful business
Basic import types
- Industrial and consumer goods
- Intermediate goods and services
Industrial and consumer goods
Industrial goods are purchased and used for commercial and industrial purposes. Raw materials, machinery, and manufacturing plants are used to create these industrial goods.
Consumer goods are goods that are ready for consumption and the fulfillment of human wants and needs. Consumer goods are products purchased by a buyer, such as clothing, food, and beverages.
Intermediate goods and services
Intermediate goods, also known as producer goods, are products that are utilized by companies in the production process of either goods or services.
The above types come under basic imports. Now let’s look into various other types here.
Various types of importers
Each country follows different customs rules and regulations, so the checklist of import documents varies. Let’s learn about some common documents.
- Bill of entry date
- Harmonized System(HS) code
- Shipment date
- Description of product
- Name of importing port
- Price and quantity of the goods.
1. Bill of entry date
It is a legal document filed by importers or customs clearance agents before the arrival of imported goods. It is submitted to customs as part of the customs clearance procedure.
Following this, the importer will be able to claim ITC on the goods.
2. Harmonized System (HS) code
It is a standardized numerical method for identifying and classifying traded goods.
All over the world, customs authorities use it to identify products, collect statistics, and assess duties and taxes.
For your information, Harmonized system code is maintained by the World Customs Organization (WCO).
3. Shipment date
The shipment date of goods means that the consignment must be shipped from the seller’s location on or before the letter of credit’s last date of shipment.
As a result, the Bill of Lading date should be on or before the “Shipment Date” mentioned on the Letter of Credit.
4. Description of product
It is a detailed description of the goods in a cargo. It defines what the product is, how it is made, and what it is used for.
5. Name of importing port
The name of the port needs to be checked because that indicates the delivery of the consignment.
6. Price and quantity of the goods
Before importing, you need to check the price printed on the consignment if the quantity of goods is correctly packed or not.
We have learned the possible types of imports. Shall we learn the procedures involved here?
Procedures for import with documentation
- Trade Inquiry
- Getting import license
- Acquiring foreign exchange
- Order Placement
- Acquiring a letter of credit
- Arrangement for payment
- Shipment receipt
- Documents check
- Arrival of goods
- Clear the customs
Importers must learn about the product’s country of origin and the export company.
After verification of the company and country of origin, make a trade inquiry to the exporter about the price of export, its quality, and the terms and conditions of export.
The exporter will send you the quotation in a response to your inquiry. The quotation will include details like availability, quality, price, and terms and conditions.
Getting import license
An import license will be required for some goods, but others can be imported freely without any license.
The importer must consult the current Export-Import (EXIM) policy to determine whether the goods he or she intends to import require import licensing.
Acquiring foreign exchange
In overseas sales, the supplier will intend to request payment in foreign currency. The currency must be converted into foreign currency to make a payment in another currency.
The exchange bank endorses and forwards the applications to the country’s central bank’s Exchange Control Department.
The central bank of the country sanctions the release of foreign exchange after examining the application based on the country’s exchange policy in effect at the time of the application.
This is the place where orders are placed.
The importer includes details about the price, quality, and grade of the goods, as well as packing, shipment, port of departure, delivery schedule, insurance, and payment instructions.
Acquiring a letter of credit
The preferred method of payment between the importer and the overseas supplier must be obtained from the importer’s bank and sent to the supplier.
A letter of credit is mentioned as a guarantee given by the importer’s bank that it will recognize the payment of export bills to the exporter’s bank up to a certain amount.
Arrangement for payment
The importer should make arrangements to pay the exporter before the goods arrive at the port.
Advance planning for financing imports is required to avoid fines on imported goods that are uncleared at the port due to a lack of payments.
The shipment receipt contains information such as the invoice number, the bill of lading or airline bill number and date, the vessel name and port of export, the description of products and quantity, and the sailing date.
Once the goods have been shipped, the overseas supplier gathers the required paperwork according to the contract and letter of credit terms and gives it to their banker for negotiation with the importer.
A set of documents consists of a bill of exchange, commercial invoice, bill of lading or airline bill, packing list, certificate of origin, maritime insurance policy, etc.
Arrival of goods
The overseas supplier will make the shipment of goods according to the agreement. There will be an import manifest document with specific details of the goods imported. The shipper who delivers the goods will provide this import manifest document to the importer.
Clear the customs
Customs clearance is the final step.
When the goods arrive at their destination, the country’s customs will inspect the documents. Once all the inspection is done, the customs will clear your freight.
Hurray! You can take your freight with you now.
I hope you are clear with the import documentation and its procedures.
In order to be successful, you must have the documents and all the procedures keenly followed.
To help you in this process of import documentation, we have our industry experts with 20+ years of experience. They can help you in this endeavor.
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