2 FOB FREE ON BOARDCost of freight & insurance to a certain point in the transportation link (usually within the exporting country) is included in the seller’s price.Buyer must pay for freight beyond that point.Specification of fob location is critical.Ex-factory, Ex-city, Ex-port.
3 CIF COST, INSURANCE, & FREIGHT Cost of freight and insurance to a port in the importing country is included in the seller’s price.Buyer must pay for freight beyond the port.Specification of CIF location is useful.Ex-port.
4 C&F COST & FREIGHTCost of freight to a port in the importing country is included in the seller’s price.Buyer must pay for insurance from the originating point and freight beyond the port.Specification of C&F location is useful.Ex-port.
5 LANDED PRICEUsually refers to the ultimate cost of the product to the buyer at his/her place of business after paying for cost, freight, insurance, and customs fees and duties.Useful benchmark for comparing quotes from different suppliers.
6 EXPORT LICENSE THE U.S. HAS TWO TYPES OF LICENSES: VALIDATED LICENSE GENERAL LICENSE
7 IMPORT LICENSE THE IMPORTER MAY NEED TO OBTAIN AN IMPORT LICENSE. MAKE SURE YOUR BUYER HAS ONE IF NECESSARY.
8 EXPORT DOCUMENTS Shipper’s export declaration with Export license Commercial (and Consular) InvoiceBill of lading (airway bill)Packing listInsurance certificateSpecial purpose certificatesEx: Country of origin, Quality, Standards, etc.
11 COLLECTION DOCUMENTS Consignment Open Account Documents against acceptance D/ADocuments against payment D/PLetter of CreditCash in advance
12 LETTER OF CREDITA letter issued by a bank to guarantee payment to the seller on proof of shipmentIrrevocable: A L/C that is irrevocable.Confirmed: A L/C that is endorsed by a second bank, that takes up the responsibility to pay the seller.