CUSTOM CLEARANCE OF EXPORT CARGO

PRESENTED BY:

VARUN SOOD

CUSTOMS CLEARANCE OF EXPORT SHIPMENT

• Shipment by Air• Shipment by Sea• Shipment by Land• Shipment by Post

• COMPUTERISED PROCESSING OF EXPORT DOCUMENTS

• ROLE OF CLEARING AND FORWARDING AGENTS -Their services are classified as:

• Essential• Optional

Essential Functions: CHA• Advising the exporter as regard the relative cost of sending

the goods by different airlines/shipping lines as well as selection of the route of the flight/sea route.

• Arrangement of containers required for shipment of the goods.

• Booking of shipping space or air freighting Making arrangements for the shipment of goods to be on board the ship/plane.

• Providing Warehouse facility to the exporters for warehousing the goods before their transportation to the docks/port.

• Transportation of goods to the docks and arrangement of warehousing at the port.

Essential Functions: CHA• Arranging for the marine/cargo insurance of the shipment• Preparing and processing of shipping documents required

for custom clearance• Arranging for various endorsements/issue of certificates

from various agencies.• Providing assistance in the packing of the shipment• Making arrangements for local transportation of goods to

the ports/docks• Forwarding the documents to the exporter for their

negotiation with the bank.

Optional Services-CHA• Providing warehousing abroad at least in some of the

major international markets in case the importer refuses to take delivery of the goods for any reasons

• Providing assistance to bring back the goods to India if the situation so demands

• Providing assistance to locate the goods in case the shipment is misplaced or the cargo is stranded at some port.

• Making arrangements for assessment of damage to the goods to the file claim with the insurance company.

IMPORTANT REGISTERATIONS WITH THE CUSTOMS

• Allotment of EDP NUMBER (ELECTRONIC DATA PROCESSING)

• Importer-Exporter Code, • RBI Code Number, • Authorized Dealer Code of the e bank and • current account

SHIPPING BILL:• Manual: Exporter is required to file appropriate type of shipping bill to

seek the order from customs clearance of Export Shipment called LET EXPORT.

• Under computerized system the exporter is not required to file the shipping bill but instead the shipping bill is generated through the computer. The exporter/CHA has to provide information through DATA ENTRY CENTRE of the customs station either in Annex A or B to generate the shipping bill.

• Annex A: Export of duty free goods or transactions where no foreign currency is involved, trade offers, gift parcels, re-export, warranty replacements, etc.

• Annex B: For Export of goods under claim of duty drawback.• Verification of the data• The system then generates the Shipping Bill with a definite number.• The shipping bill is a basic document for obtaining the LET EXPORT

ORDER

EXCHANGE CONTROL DECLARATION FORM

• Every exporter is required to declare the exchange value of the export shipment by giving an undertaking that the export proceeds shall be released within a period of 6 months or due date whichever is earlier.

• Manual processing: GR FORM for sea and air. It is issued in 6 copies.

• GR form in case of Post is called PP• GR form in case of Software is called SOFTEX.• Computerized Processing: GR Form is replaced by SDF

DECLARATION-2 Copies

ENDORESMENTS OR CERTIFICATIONS ON SHIPPING BILL

• Eg: Quota for the exports of ready made garments from the Apparel Export Promotion Council on the shipping bill.

• Since the shipping bill is generated from the computer only after obtaining the LET EXPORT ORDER, the endorsements are to be done later.

DOCUMENTATION REQUIRMENT IN CASE OF SHIPMENT BY SEA/AIR

• Shipping Bill (if manual) or Annex A or B • Commercial Invoice• Packing List• Certificate of Origin/GSP Certificate of Origin• GR/SDF• Copy of the LC/Export Order/Export Contract• AR-4 duly approved by the Central Excise officer or Invoice showing

clearance of excisable goods• Declaration from Export of goods under:

– Claim of duty drawback– Anticipation of Advance License/DEEC– DEEC Scheme– Without Certification from Export Inspection Agency

DOCUMENTATION REQUIRMENT IN CASE OF SHIPMENT BY SEA/AIR

• Additional Documents (If Required):• Export License• Pre-Shipment Certificate• Marine Insurance Policy in triplicate• Freight Declaration• Special custom/consular legalized invoice• Declaration of quality, quantity and weight• Sea:• Port Trust Copy of the shipping bill (Dock Challan)• Cart Chit/Vehicle ticket

DOCUMENTATION REQUIRMENT IN CASE OF SHIPMENT BY POST

• CUSTOM DECLARATION FORM instead of Shipping Bill• Commercial Invoice• Packing List• Certificate of Origin/GSP Certificate of Origin• Copy of the LC/Export Order/Export Contract• AR-4 duly approved by the Central Excise officer or Invoice showing

clearance of excisable goods• Instead of GR/SDF, the Exchange Control Declaration Form will be PP

FORM• DEEC Book in case of shipment under Advance License is required.• Form D in case the shipment is for exports of goods under claim for

duty Drawback.• Insurance Policy• Export License• Pre-shipment inspection Certificate

DOCUMENTATION REQUIRMENT IN CASE OF SHIPMENT BY LAND

The shipment of goods by lorry of rail or boat can be sent to the neighboring countries like Pakistan, Bangladesh Myanmar and Nepal

Documents required are:• Bill of Export of appropriate type• Commercial Invoice• Packing List• Certificate of Origin/GSP Certificate of Origin• Copy of the LC/Export Order/Export Contract• AR-4 duly approved by the Central Excise officer or Invoice showing

clearance of excisable goods• Exchange Control Declaration Form will be GR FORM• Drawback Bill • Insurance Policy• Export License• Pre-shipment inspection Certificate

CUSTOMER CLEARANCE PROCEDURES

• Checking the Shipping Documents• Physical Examination of the export cargo• Loading of the goods• Post Loading Certification

SHIPMENTS BY AIR

Checking Of the Shipping Documents:• Booking –Carting Order-AWB• Submit the Original and Duplicate of SDF to the Central

Registration Unit (CRU) who signs the SDF form and allots the running 10 digit RBI Code number on the SDF Forms

• The CHA then submit the Annex A or B as per the case to the Service Center at the Customs Station

• The service center then issues the Check list to CHA for verification who verifies and signs and gives back to the service center for generation of the shipping bill for noting and further processing.

• The service Center generates the shipping bill and shipping bill number is automatically allotted to it for follow up

SHIPMENTS BY AIR

• Physical examination of the export cargo • Cargo is brought to the export shed on the day mentioned in the caring

order.• CHA gives ANNEXE C to the examining officer, who verifies • CHA then arranges to unload the cargo and does the weight check.• CHA arranges for the stacking of the cargo in the export cargo shed at

the place ear marked for the particular airline• If satisfied then the in order then the inspector shall record the report

of the physical examination of the cargo on the shipping bill through the computer system.

• The superidentant of the customs will then issue the LET EXPORT ORDER if the report and the documents are in order.

• CHA will now get the shipping bill printed and he is given the exporter’s copy and the export promotion copy of the shipping bill duly signed by the competent authorities.

SHIPMENTS BY AIR

• Loading of the Goods:• After the LET EXPORT ORDER, export cargo is moved to the

bonded are for its storage and palletisation by International Airport Authority of India (IAAI) The latter acknowledges the receipt of the cargo and on the caring order and copy of the AWB. For security reason a period of 24-48 hours is observed before loading the cargo aboard in the aircraft.

• The airline prepares the EXPORT GENERAL MAINFES (EGM) before the arrival of the flight for its handing over to the customs.

• On the day of the flight the cargo is moved to the loading are as per the details given by EGM and loading is under the supervision of the customs officer in charge of loading operations.

• After the cargo is loaded the airlines file EGM with the customs in a day or two.

SHIPMENTS BY AIR

• Post lading Certification:• After loading the captain of the airline flight signs the

duplicate and triplicate copy of the shipping bill against the goods received by him.

• After the process of customs clearance, the CHA/exporter is returned the documents he has submitted except for the original SDF is directly given by customs to the RBI

SHIPMENT BY SEA

Verification of Documents:Facilities are provided by Port Trust Authority of the concernedsea port.

Booking starts 4-6 weeks before the arrival of the ship and CHA gets the Shipping Order

The customs authority assign a number and date on the shipping bill, GR/SDF and also assign the rotation number of the ship/vessel, the details of shipment are noted in a register.

After the examination of documents and appraisement of the value, the Customs Appraiser/Examiner makes an endorsement on the shipping bill giving the directions to the Dock Appraiser to conduct the physical Examination of the goods

SHIPMENT BY SEA

Verification of Documents:

At this stage the Original Shipping bill and acopy of the commercial invoice are returnedto the CHA to be presented to the Dock Appraiser.

CHA then submits the Port Trust documentsto the Shed Supervisor of the port and obtain the caring order for bring the export cargo to the transit shed for physical examination by the Dock Appraiser.

SHIPMENT BY SEA Physical Examination : Done by the Dock appraiser and the documents submitted are:• Duplicate, Triplicate and export promotion copy of the

shipping bill• Commercial Invoice• Packing List• AR-4• Inspection Certificate in Original• GR/SDF (Duplicate)• After the examination, Dock Appraiser records his report on

the shipping bill and issues the LET EXPORT ORDER on the duplicate of the shipping bill and gives it to the CHA

• CHA presents all the documents with LET EXPORT ORDER to the Preventive Officer of Customs for the issue of LET SHIP ORDER

SHIPMENT BY SEA • Loading of the Cargo:• It is done under supervision of Preventive officer of

Customs. • He makes an endorsement LET SHIP ORDER on the

duplicate copy of the shipping bill. This authorizes the shipping company to accept the cargo for loading on the vessel.

• After the LET SHIP Order, the cargo is move to the dock for loading onto the vessel.

• The mate of the ship issues a receipt called the MATE’S RECEIPT to the shed superidentant after the loading of the cargo.

• The CHA gives payment of port and dock charges and get the Mate’s receipt

SHIPMENT BY SEA• Post Loading Certification:• CHA gives the Mate Receipt to the Preventive officer who

records the Certificate of Shipment on all copies of the shipping bill and AR-4.

• The preventive officer returns the export promotion cop, a copy of the drawback shipping bill and the duplicate AR-4 to the CHA.

• CHA then presents the Mate receipt to the shipping line and requests it for issue of BL (Negotiable or Non-Negotiable)

• The agent of the shipping lines files the Export General Manifest with the customs.

EXPORT THROUGH POST PARCEL

• Shipment with low volume,• High Value Goods like Handicraft items, gems

and jewellery• Dispatch of trade samples to the foreign

buyers• The post parcels for the shipment of export

goods are sent through the FOREIGN POST OFFICES

Steps are to be followed while sending shipment by post

• Booking: The parcels for export goods should be booked by the Foreign POST OFFICES

• Weight: The general maximum Weight limit of a foreign parcel by sea/air is restricted to 20/10kg respectively by the Universal Postal Union.

• Size: • Maximum Size of post parcel should not exceed 2

METERS. However in no case should the length exceed 1.05 METERS

• Minimum Size should not be less than 90mmx140mm• Manner of addressing: It is obligatory to write the

address of the sender on the parcel in ink or with copying ink pencil.

Steps are to be followed while sending shipment by post

Packing:• Leave sufficient space for scribbling instructions and affixing

stamps and labels• Parcel should be sturdy to cover long distances or is to

undergo many trans-shipments• An Air Mail post parcel must bear on the top left hand corner

of the address side, the special blue mail air mail label-PAR AVION-BY AIR MAIL AVAILABE AT POST OFFICE

Documentary Requirements:Dispatch note: It is used for giving instructions to the postal

authorities for the treatment to be given to the parcel in the event of its non-delivery. Failing which, the parcel is automatically returned back giving rise to covering of return charges.

• Customs Declaration Form (CDF)

EXPORT SHIPMENT THROUGH COURIER

• To send samples or free trade samples or documents or small shipments

• Maximum Weight of the package should not be more than 70 kg

• The exporters now can send the commercial samples up to the value limit of Rs 50000/-.

EXPORT SHIPMENT THROUGH COURIER

The authorized courier shall file a statement with the proper officer of the Customs either in the Form Courier Shipping Bill-I or the Form courier shipping bill-II regarding the export goods before the departure of the flight.

After filing the relevant Courier Shipping Bill with custom officer with inspect, examine and assess the consignment.

The Courier should pack the export goods separately in separate identifiable courier company bags with appropriate labels in the following categories, namely• Documents• Samples and Free gifts• Dutiable or Commercial Goods

DOCUMENTS INVOLVED• Basic Documents:

• Export Order• Performa Invoice• Packing List

• Documents required by Customs:• Shipping Bill

• Foreign Exchange related documents: Form SDF GR Form Softex PP Form

• Documents specifically required by the buyer to avail concession or to facilitate easy passage of the cargo:

GSP / Certificate of Origin Inspection Certificate Bill of exchange Consular Invoice

• Documents relating to shipment• Bill of leading or Charter party• Marine Insurance Policy• Shipping Bill

Export Order: This is the document on the basis of which the exporter procures or prepares the goods and is also useful in the preparation of various other documents.

• Performa Invoice: This document indicates the details of goods to be exported. It is an offer to sell made by an exporter to the importer. Once the offer is accepted by the exporter it becomes an export order.

• Export Invoice • Customs Invoice: • Consular Invoice • legalized invoice • Packing List:

Intimation for Inspection: This is a prescribed form of notice by the Export Inspection Agency. The exporter has to give notice for inspection in this prescribed form for inspectionof the export shipment.

Inspection Certificate: The export inspection agency conducts pre-shipment inspection of the goods notified for compulsory pre-shipment inspection of the export goods.This agency issues the Certificate called Certification of Inspection.

Shipping Instructions: This document provides a check list of various instructions an exporter may like to convey to the Shipping agent.

Certificate of Origin/GSP Certificate of Origin

The GSP Scheme enables the importers in developed countries to import goods form developing countries like India at concessional rates of import duty or without payment of duty.

In India, GSP can be issued by the following agencies:• Export Inspection Agency (For all products)• Textile Committee (Ready made garments and other textile products)• Central Silk Board (Silk Items)• Coir Board (For Coir Products)• Development Commissioner (Handicrafts

Bill of exchange: It is an unconditional written order requesting the buyer to pay a specified sum of money to a specified person at specified time.

• Shipping Order: This is a reservation slip issued by the shipping line at the time of reservation of shipping space for a particular export shipment.

• Mate’s receipt: It is receipt issued by Mate (Chief Officer) of the ship acknowledging the loading of cargo on the ship. This receipt states the conditions in which goods ere received.

Bill of Lading

• A receipt for the goods shipped• A contract of affreightment• a document of title to goods.• It is transferable by endorsements and

delivery. It’s possessions equivalent to the possession of goods.

Types of BL

• Freight paid or freight to collect B/L• Clean or clause B/L • Direct or through B/L • Shipped B/L (or on-Board) and Received for

shipment B/L • Copies of B/L: The original alone can transfer

the title to the goods

• Endorsement on B/L:• The B/L is a transferable document as per

custom and practice. It is very important and useful and the utility lies in the ability to transfer the title to the goods from the Exporter to any party or to the importer by means of an endorsement on the B/L

• Shipment Advice • Letter to Bank for Negotiation/Collection of Documents

Regulatory Documents:Exchange Control Declaration Form –GR, PP, Softex, SDFFreight Payment CertificateInsurance Premium Payment CertificateAR4: Application for Removal of Excisable Goods for Export Marine Insurance Policy

Shipping Bill

It gives the details such as: • Quantity and value of the goods and of the export

order, • The name of the vessel carrying the goods• The FOB price of the goods, total number of

packages, etc. • This is an important document required by Customs

for permitting shipment.

Types of Shipping Bill• Free shipping bill-used for exports of goods which attract no

duty nor entitled to any duty drawback. White)• Drawback shipping.-Green• DEPB shipping bill: used when goods are shipped under the

DEPB scheme-Blue • Shipping bill for Ex-bond: used when the exported goods are

those which had been imported earlier and meant for re-export.

• Shipping bill for goods on which export duty is payable.-Yellow

• Re-export of imported goods

• Black List Certificate • Manufacturers/ Supplier's Quality/ Inspection

Certificate: Manufacturer's Certificate • Weight Note • Certificate of Chemical Analysis • Antiquity Measurement

THANK YOU!