Back to: COMMERCE SS1
Welcome to class!
In today’s class, we will be talking about foreign trade – stages and documentation. Enjoy the class!
Foreign Trade – Stages and Documentation
Documents used in international trade
Certificate of Origin:
This is a document signed by the customs office of the exporting country to show the country from which the goods have been exported or where it originated from. This document is important when the importing country has a preferential tariff applies only to certain countries e.g. ECOWAS member states.
Uses of the certificate of origin
- It shows where the goods come from
- It serves as an instrument for preferential tariff
- It helps to determine the outflow of foreign exchange to the country of origin
Bill of sight:
This is a temporary document which enables goods to be examined by customs officials before the arrival of shipping documents.
A bill of sight is submitted to the customs authorities if a full description of the imported goods cannot be provided e.g. due to the non – arrival of shipping documents (i.e. bill of lading). It enables the goods to be landed and their inspection is done while a full description of the goods will be provided later.
Bill of entry:
This is a document that contains detailed particulars (information) of all imported goods coming into the country. It provides the customs with particulars of goods imported.
This is an authority to import or export given by the Ministry of Industry to an individual or company. It gives access to the importer to purchase foreign exchange for this purpose.
- State three importance of the Certificate of Origin in International Trade.
- Write short notes on the following: A. Bill of Sight B. Bill of Entry
Letter of Hypothecation:
This is a letter an exporter send together with the shipping document empowering a bank to sell the goods in the foreign country for the best price available if the importer fails to accept (or pay) the bill or pay for the goods.
This is a bill of exchange to which various shipping documents like bill of lading, export invoice and insurance policy are attached.
N.B: The under-listed documents which are also used in foreign trade have been mentioned in connection with other topics already taught.
Some other documents are
- Ship’s Manifest
- Charter Party
- Export Invoice
- Freight Note
- Airway Bill/Consignment Note
- Dock Warrant
- Certificate of Insurance or Insurance Policy
- Shipping Note
- Write short notes on the following showing their main uses in foreign trade A. Shipping Note B. Shipping Manifest C. Bill of Sight D. Dock Warrant E. Bill of entry
- Explain the three types of Charter Party.
Essential Commerce for SSS by O.A. Longe Page 53 – 64
- Give five reasons why small scale retail businesses may fail
- List five instances where a manufacturer may decide to sell his goods directly to the consumer
- State eight features of hawking
- Explain five reasons why tariffs are imposed on imports
- Explain five features of itinerant trading
- List four documents used in Foreign Trade
- What is an Airway Bill
In our next class, we will be talking about Customs and Excise Authority. We hope you enjoyed the class.
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