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Chapter 9: Performance of Import and Export Contract Abstract: this chapter mainly talks about the main steps in the general process in performance of.

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Presentation on theme: "Chapter 9: Performance of Import and Export Contract Abstract: this chapter mainly talks about the main steps in the general process in performance of."— Presentation transcript:

1 Chapter 9: Performance of Import and Export Contract Abstract: this chapter mainly talks about the main steps in the general process in performance of the contract and its related issues that should be pay close attention to. 。  Section 1: Performance of Export Contract  Section 2: Performance of Import Contract  Section 3: Main documents of import and export

2 Section 1: Performance of Export Contract  1. Preparation of the goods, applying for inspection  2. Urging establishment of L/C, examine the L/C, amending the L/C (1) Urging establishment of L/C (2) Examine the L/C

3 (3) Amendment to the L/C  Both applicant and beneficiary can ask for amendment to an L/C. If the beneficiary asks for amendment, the usual procedure is that the buyer should first obtain consent form the beneficiary and then instruct the opening bank to amend the L/C.  Beneficiary----applicant----issuing bank----advising bank----beneficiary  Cautions to the amendment of L/C

4 3 . Shipment, Making Declaration to the Customs, Taking out Insurance (1) Steps of shipment  1, check the date of shipment, fill in the booking note of the export goods (B/N)  2. Shipping company or shipping agency issues the shipping order  3. After shipment, the master or mate issues the mate’s receipt  4. Shipper exchanges the mate’s receipt for the bill of lading from the Ocean Shipping Agency. (2) Declaration to the Customs There are three kinds of companies making declaration to the customs: (3) Taking out Insurance

5 4. Making out documents for settlement under L/C (1) Three means to make settlement under L/C  1. Make Settlement after the Payment Is Made  2. Make Time Settlement  3. Make Settlement through Negotiation (2) Several methods to deal with discrepancy

6 Section 2: Performance of Import Contract The main steps in the general process in performance of the import contract are (under FOB terms, payment by L/C) as follows:  Open L/C  Conclusion of the transport contract  Cover insurance  Examination of documents and payment for the purchase price  Customs entry  Taking delivery and allocation

7 Section 3: Main documents of import and export 1. Main operating documents of import and export  (1) Inspection certificate  (2) Customs declaration  (3) Insurance policy  (4) Shipping order  (5) Mate’s receipt  (6)  (7) Tax-refund form of export goods

8 2. Main documents of import and export for settlement  (1) Bill of exchange (B/E)  (2) Invoice 1. Commercial Invoice Note: The column of “To__” in a commercial invoice refers to “consignee”. 2. Customs Invoice The customs invoice is one of the documents required by the customs which has a unified form.

9 3. Consular Invoice 4. Manufactures’ Invoice 5. Proforma Invoice The proforma invoice is an invoice sent for form’s sake. It serves as a price reference and enables the buyer to make the necessary preliminary arrangements, such as obtaining an import license.

10  (3) Bill of Lading  (4) Insurance Policy  (5) Certificate of Origin  (6) Generalized System of Preferences Documents  (7) Packing List, Measurement List and Weight Memo  (8) Inspection Certificate

11 3. Basic principles of making and examming documents.  Accuracy, complete, prompt, concise, neat  The order of issuing documents is as follows: Commercial Invoice, Packing List; Certificate of Origin; Inspection Certificate; Insurance Policy; Bill of lading; Draft

12 Summary This chapter mainly talks about the main steps in the general process in performance of the contract and its related issues that should be pay close attention to. Key point: Import and export documents Difficult point: document for settlement under the L/C

13 Questions:  What kind of work do both parties need to do to fulfill the import and export contract?  What are the precautions of amending L/C?  What kind of the methods do we have to deal with the discrepancy?  What’s the method of making document for settlement?


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