THREE DOCUMENTS USED IN IMPORTED TRADE BÀI THI TIẾNG ANH CHUYÊN NGÀNH LOGISTICS ĐỀ TÀI THREE DOCUMENTS USED IN IMPORTED TRADE HÀ NỘI 2021 Contents CHAPTER 1 INTRODUCTION 3 1 1 Reason for choosing the topic 3 1 2 Research goals 3 1 3 Research objective 3 1 4 Reasearch scope 3 CHAPTER 2 CONTENT OF THE SUBJECT 4 2 1 Proforma Invoice (PI) 4 2 1 1 Definition 5 2 1 2 Content 5 2 1 3 Function 5 2 1 4 When do you use PI? 6 2 2 Commercial Invoice (CI) 6 2 2 1 Definition 7 2 2 2 Function 7 2 2 3 Terms 8 2.
BÀI THI TIẾNG ANH CHUYÊN NGÀNH LOGISTICS ĐỀ TÀI THREE DOCUMENTS USED IN IMPORTED TRADE HÀ NỘI - 2021 THREE DOCUMENTS USED IN IMPORTED TRADE Contents CHAPTER - INTRODUCTION 1.1 Reason for choosing the topic 1.2 Research goals 1.3 Research objective 1.4 Reasearch scope CHAPTER - CONTENT OF THE SUBJECT 2.1 Proforma Invoice (PI) 2.1.1 Definition 2.1.2 Content 2.1.3 Function .5 2.1.4 When you use PI? 2.2 Commercial Invoice (CI) 2.2.1 Definition 2.2.2 Function .7 2.2.3 Terms 2.2.4 Content 2.2.5 When you issue CI? .8 CHAPTER – CONCLUSION .12 THREE DOCUMENTS USED IN IMPORTED TRADE CHAPTER - INTRODUCTION 1.1 Reason for choosing the topic The world economic context in 2020 is very complicated and not favorable for international trade This is the year the world witnessed rapid, complicated changes and especially the negative impact of the Covid-19 epidemic on all socio-economic fields The appearance of the Covid-19 epidemic has caused negative effects on economic activities, in which import and export of goods have been seriously affected These fluctuations and difficulties have made countries tend to use domestic products instead of imported products when implementing measures to close borders to prevent epidemics However, Vietnam's import and export activities have stood firm in the global disruption of international trade, maintaining growth momentum and creating important traction for the whole economy Import is a very familiar term in today's economic era This activity has helped Vietnam open its market and grow its economy rapidly In the process of importing goods, documents are a very important means to perform that task However, you know what documents are used in importing commercial goods? To learn more about the documents in the import process, I chose this topic: “Three documents used in imported trade” THREE DOCUMENTS USED IN IMPORTED TRADE 1.2 Research goals To find out clearly the contents, functions, and usage of import documents Study the current use of these documents, and determine when to use these documents 1.3 Research objective Three documents of import are used commonly in imported activity 1.4 Reasearch scope Learn information through textbooks, the media, radio and especially the indispensable means of the internet THREE DOCUMENTS USED IN IMPORTED TRADE CHAPTER - CONTENT OF THE TOPIC International importing opens the Vietnamese economies to new markets and exciting growth possibilities So, you need to make sure you understand some documents when you import goods from foreign to Vietnam, and crucially, you need to know some documents in importing When you are importing goods to Vietnam, you may receive a lot of documents from your suppliers And the suppliers named them Proforma Invoice, Commercial Invoice, and Packing List Those documents are commonly used in the importing business 2.1 Proforma Invoice (PI) First of all, We will comprehend some information about the Proforma Invoice, which is the important documents in the set of importing documents THREE DOCUMENTS USED IN IMPORTED TRADE Pic.1: Proforma Invoice 2.1.1 Definition PI is the short term for Proforma Invoice Proforma Invoice is defined as a quotation form sent to a prospective buyer before the business sends the goods or products It shows the commitment of the seller to sell the goods according to the agreed terms and conditions PI includes more details in the goods' description, prices, payment terms, and delivery details It serves as the base of various invoices you must fulfill later THREE DOCUMENTS USED IN IMPORTED TRADE 2.1.2 Content It also can be thought of as a “draft” invoice, which is the type commonly in export and import documents, but not used to collect money because it is not a document for money However, as well as the form and the contents like as commercial invoice As you are seeing on the screen, The content of PI includes four parts that must behave in the invoice is Goods's description, Prices, Date and contact details, Shipping and Payment terms That's all 2.1.3 Function What are the functions of proforma quotation? Sign of Good business will Proforma quotation is generally non-compulsory However many buyers demand this invoice as a form of goodwill Business owners can also use this form as a tool to create more consistency in transactions The form serves as a softly binding document between the business owner and the buyer Streamlining the business process In a large-scale business, each transaction must go through a lengthy process Changes during the vital sales steps will make the process trouble some By providing a proforma invoice at the beginning, business owners can smooth over the details and streamline the process until the transaction is completed Better negotiation tool Sending a proforma quotation means you have a serious commitment to providing goods and services Buyers can also get a clearer picture of what you are trying to sell Although this is not a THREE DOCUMENTS USED IN IMPORTED TRADE final form to make and send, this can serve as a great negotiation tool.Proforma invoice as a way to be paid more quickly Proforma invoice as a way to be paid more quickly Expecting to be paid more quickly? Proforma invoice can help you get it from the customers It gives them information about pricing and payment terms earlier, which leads to quicker payment and smoother transactions 2.1.4 When you use PI? When supplying high-value goods or services to a new customer or unknown entity and you don’t want to risk giving them a credit account Established businesses that insist on a pro forma instead of a regular invoice for pre-payment of an order In the real case, the supplier will first send a draft quotation at the buyer’s request The quotation you get from the supplier will include at least the product details, price, and incoterms After a few backs and forth, the supplier and you will reach a deal Then you will send the supplier a Purchasing Order In return, the supplier will issue a proforma invoice The proforma invoice not only serves as a quotation, but also includes information like the title of the buyer and seller product details, price, incoterms, payment terms, transportation mode, delivery time, invoice date and number, and even the bank information After sign and seal by both the buyer and the seller, it will work as an official buying contract Before making the down payment, the THREE DOCUMENTS USED IN IMPORTED TRADE best practice for a buyer is to double-check with the customs broker If the products are permitted to be imported to your country And when you are going to make the payment, make sure that the beneficiary name of the bank account is the same as the title of the seller in the invoice That's a proforma invoice More information about lowering risk in making payment will be discussed later 2.2 Commercial Invoice (CI) When used in foreign trade, a commercial invoice is a customs document It is used as a customs declaration provided by the person or corporation that is exporting an item across international borders And now, we go to comprehend that together The commercial invoice is a record or evidence of the transactions between the exporters and the importers The commercial invoice is the “actual invoice” which is much more concrete than the proforma invoice THREE DOCUMENTS USED IN IMPORTED TRADE Pic.2: Commercial Invoice 2.2.1 Definition The commercial invoice is one of the most important documents in international trade CI is the short term for Commercial Invoice It is a legal document between the supplier and the customer that clearly describes the sold goods and the amount due to the customer It may also be one of the main documents used by customs in determining customs duties 10 THREE DOCUMENTS USED IN IMPORTED TRADE 2.2.2 Function Commercial Invoice is used to calculate and assess the duties and taxes due for the shipment, international commercial terms (like the Cost in a CIF) It may also be required for payment purposes while using for the case where a buyer pays via Letter of Credit And it is commonly used to compare the information with other types of documents such as CO, license, 2.2.3 Terms Which is Commercial Invoice abide by? Having three terms is abided by in Commercial Invoice when using in exporting and importing Such as INCOTERMS (like FOB, CIF, CFR, and more); Payment terms (like as T/T, L/C, and D/P), and the end of the Shipping terms (specifically by sea) 2.2.4 Content So, what information may have in CI? There are plenty of Commercial Invoice templates and samples to choose from, however, the content of CI must have five information like Invoice Information, Shipper Information, Consignee Information, Shipping Information, and Shipment Information All information must be clear that show exactly and truly 2.2.5 When you issue CI? When you issue CI, you should note a few things: - CI is issued after loading goods into containers and lining up onboard 11 THREE DOCUMENTS USED IN IMPORTED TRADE - CI is issued on or after the date of issue of LC, and before the expiration date of LC - And the last one, CI is issued when customs pay in advance or ship many times 2.2 Packing list (PL) Why you need a packing list in foreign trade? A packing list provides you with information about your shipment and required your signature upon the receipt of your goods It is only required when shipped goods are packed into larger units (eg a container or an aircraft console) So, in the last step, we will go to comprehend the Packing list to know more about it 12 THREE DOCUMENTS USED IN IMPORTED TRADE Pic.3: Packing List 2.2.1 Definition PI is the short term for Packing list Packing list is a set of documents in the import and export of goods It provides information about the shipment, including how it’s packed, the dimension and weight of each package, and the marks and numbers that are noted on the outside of the boxes 2.2.2 Content A packing list shows how the goods were packed for inspection and shipping purposes It includes four information about: Packing List Information Shipper and Consignee Packing details Port of Loading and Port of Discharge The form is completed by the exporter, although your freight forwarder will complete it if the goods are re-packaged at their warehouse 2.3.4 Function Packing list tells us the net weight, weight including packaging, packing method of the goods, type of goods, quantity, packing specifications From this we can calculate the following parts: 13 THREE DOCUMENTS USED IN IMPORTED TRADE Organize warehouse Arrange means of transport Loading and unloading goods using specialized equipment such as machines or hiring workers Is the item inspected or not… Immediately after packing is complete, the Seller will immediately send the buyer a packing list for the buyer to check the goods before receiving the goods 2.4 CI and PL The commercial invoice can be used as a shipping invoice along with the packing list for customs clearance in the port destination For both commercial invoice and packing list no specific format is required but general information, for example, the title For both the buyer and the seller, the product details, the price, the invoice date, and number, and the packing details are supposed to be included But in some countries like Brazil, the HS code of products is also required to be included in the CI or PI for customs clearance A set of documents are supposed to be consistent with each other The given information in the PL must match the commercial invoice and should reflect the same transaction parties And there are cases that the exporter mixes all the data of CI and PL into one document and makes it work as a shipping invoice The documents must be 14 THREE DOCUMENTS USED IN IMPORTED TRADE submitted in original along with at least one copy In the practice, both the original and the copy of CI and PL are signed and sealed 15 THREE DOCUMENTS USED IN IMPORTED TRADE CHAPTER – CONCLUSION 16 ... more about the documents in the import process, I chose this topic: ? ?Three documents used in imported trade? ?? THREE DOCUMENTS USED IN IMPORTED TRADE 1.2 Research goals To find out clearly the contents,... important documents in the set of importing documents THREE DOCUMENTS USED IN IMPORTED TRADE Pic.1: Proforma Invoice 2.1.1 Definition PI is the short term for Proforma Invoice Proforma Invoice is defined... It may also be one of the main documents used by customs in determining customs duties 10 THREE DOCUMENTS USED IN IMPORTED TRADE 2.2.2 Function Commercial Invoice is used to calculate and assess