CHAPTER 4:

TRADE PROCEDURES AND DOCUMENTS

Outline
• State of play
• Impact of cumbersome
• Basic principles and good practices
 Data exchange
in International Trade
Purchase Exportation Importation
Bill of lading, Documentation
Vessel Booking Request
Confirmed Line of Credit
Vessel Booking Confirmation
Release/Approval
Importer’s Exporter’s Bill of Lading
Bank Bank
Rated Bill of Lading Arrival Notice
Original B/L, Import
Fund Transfer
Invoice, PO, Ocean Carrier Terminal
Dock Receipt
Packing List Operator

Demurrage
Line of Credit guarantee &
Proforma Invoice payment Cargo
LC Export Status
Confirmation Terminal
Purchase Order Operator
Customs House Broker
Importer Exporter
Dock receipt Pick-up &
Import Delivery Order
Proforma Invoice Pick-up & Delivery Order Docs
Letter of Release/Hold
Instruction Notice Cargo Status Inland
Invoice, PO Carrier
Freight Forwarder /
Inland
NVOCC
Carrier
Manifest Customs ( Import )
Shipping & Funding Detail Dock receipt
Export Declaration
Marine Insurance Shipping & funding detail Vessel Manifest
Company AES
Export Declaration
Port
Converted Vessel
Customs (Export)
Manifest

Importer Notice
PRE-ARRIVAL & ARRIVAL INFORMATION
Pre-Arrival
• Vessel’s characteristics or ship’s particulars, kind and tonnage of cargo, vessel’s ETA and master’s requests must be notified
to the Harbour Master Department every 48hrs, 24hrs or at least six hours prior to vessel’s arrival at the port’s anchorage
areas.
Arrival
• The component of the committee that performs vessel clearance consists of 10 members from Harbour Master
Department, Department of Customs and Excise, Immigration Police, National Shipping Agency and Broker, and
Quarantine Authorities. Ten copies of cargo manifest are required to be provided to the Department of Customs and
Excise.
• Entry permit (arranged by official shipping agency),
• Last port clearance certificate,
• 15 lists of last port of call (at least 10 last ports),
• 5 declarations of vessel’s arrival,
• 10 import cargo manifests,
• 3 bills of loading,
• 2 transit cargo manifests,
• 7 crew lists,
• 7 passenger lists,
• 3 lists of vessel’s provisions,
• 3 lists of crew personal effects,
• 1 copy of health declaration certificate,
• 1 copy of vaccination list,
• 1 copy of drugs and narcotic list,
• 1 copy of fresh water origin,
• 3 cargo plans,
• 1 copy of valid original ship’s certificates (to be collected only on the first call of the year of each ship),
• Certificate of vessel's registration,
– International load line certificate,
– International tonnage certificate,
– International oil pollution prevention certificate,
– Cargo vessel safety equipment certificate,
– Cargo vessel safety construction certificate,
– Cargo vessel safety radio certificate,
– Minimum safe manning certificate.
• Exemption Certificate (to be inspected by quarantine officers ).
Too many documents!
Enquiry Freight invoice
Order Cargo manifest
Despatch advice Export licence
Collection order Exchange control doc.
Payment order Phytosanitary certificate
Documentary credit Veterinary certificate
Forwarding instructions Certificate of origin
Forwarder's invoice Consular invoice
Goods receipt Dangerous goods declaration
Air waybill Import licence
Road consignment note Customs delivery note
Rail consignment note TIR carnet
Bill of lading
Days to complete each stage of importing

Port and Customs Inland

Pre-arrival terminal and transport to
Region documents handling inspections warehouse Total time
OECD high income 8 2 2 2 14
East Asia & Pacific 18 3 4 3 28
Latin America & Caribbean 24 4 5 3 36
Middle East & North Africa 25 5 9 4 43
Europe & Central Asia 25 4 7 7 43
South Asia 24 6 7 10 47
Sub-Saharan Africa 33 8 10 9 59
World 23 5 6 5 40

Source: World Bank Doing business 2006

Basic principles and good practices
• Time procedures, data, and documents
should be based on international
conventions, standards, and other relevant
instruments.
• => to improve transparency and predictability
Basic principles and good practices
• Data and documents should be kept to a
minimum:
– adopt simplified documents aligned with
international standards
– Identify redundant or unnecessary documentation
– Use trade data and documents aligned to
international standards (located in the same place/
formatted in the same way) => easier to fill out and
minimize errors
– Accept copies of documents
Basic principles and good practices
• Clearance and release procedures should be kept as simple as
possible
– Pre- arrival of processing documents:
• The customs authority should allow traders to submit clearance data prior to
arrival of the consignment.
• The data should be processed and analyzed without delay so that
consignments can be released immediately upon arrival.
• When duties and other charges are not determined on or prior to arrival, a
mechanism allowing for release based on the provision of a (financial)
guarantee or surety to customs may also be put in place.
– Computerization and automation of customs and other border agency
procedures for import and export, making it possible for traders to
present customs declarations, and other supplementary documents
electronically. Ideally, electronic payment of duties, taxes, and fees
should also be made possible.
Basic principles and good practices
- Risk management should be put in place, and authorities should
systematically use them to conduct documentary and physical
examination of shipments.
- Risk can be defined as “the chance of something
happening that will have an impact on objectives”. Risk
management attempts to control and manage risk in
order to achieve the best possible results; it can be
applied to nearly every decision-making situation.
- In the Customs context, risk management represents a
modern, effective and efficient way of working and
importantly assists Customs administrations in managing
their various functions effectively and in deploying their
resources more effectively.
Basic principles and good practices
- For a given risk sector, the risk management process
involves identifying the risks which could arise, analyzing
the likelihood that they will in fact occur, evaluating their
impact and assigning an order of priority for dealing with
them. Implementing this risk management procedure in
Customs work will make it possible to :
+) focus attention on the high-risk areas, for a more
cost-effective use of the available resources;
+) detect irregularities more easily;
+) perform fewer checks on companies which comply with
the laws and regulations;
+) avoid hindering the circulation of goods unnecessarily.
Basic principles and good practices
– The World Customs Organization (WCO) defines "risk
management" as "the systematic application of management
procedures and practices which provide Customs with the
necessary information to address movements or
consignments which present a risk" (WCO, 2010). This
measure allows reducing the time required for clearance
while improving controls.
– Such systems allow the identification of the risk level
associated with a particular shipment according to specific
(nondiscriminatory) criteria, and based on the analysis of
available information.
– The objective is to ease the clearance and release of low-risk
consignments, and to identify high-risk consignments for
inspection. Such systems should be based on international
standards and practices.
– It reflects a "win-win" solution for government control of
goods and the businesses involved.
Basic principles and good practices
– Post clearance audit: is an international best practice by
customs designed to facilitate trade by refocusing control from
the border to the back end of the import clearance process.
• A customs authority may release the majority of consignments upon
arrival with compliance verification at a later time.
• Such compliance verification is conducted at the importers’ premises,
where auditors have access to relevant company records.
• The post-clearance audit system allows the release of low-risk imports
with minimum customs intervention at the border.
• It therefore facilitates the release of legitimate imports while
protecting government revenue
Basic principles and good practices
- Post-clearance audits are generally carried out for compliance
verification purposes in the areas of valuation, origin, tariff
classification, duty relief/drawback remission programmes, etc.,
but other areas may also be targeted as necessary.
- Depending on the profile of the auditee and its business (e.g.,
type of business, goods, revenue involved, etc.) the audit may
be conducted on a continuous, cyclical or occasional basis.
- Post-clearance audit is an effective tool for Customs control
because it provides a clearer and more comprehensive picture
of the transactions relevant to Customs as reflected in the books
and records of international traders. At the same time, it
enables Customs administrations to offer the trader facilitation
measures in the form of simplified procedures (e.g., periodic
entry system).
Basic principles and good practices
Authorized traders schemes should be developed for highly compliant
traders. These schemes provide additional facilitation measures to
traders who demonstrate a high level of compliance with import and
export requirements such as the possibility of periodic declarations and
reduced physical inspections or documentary requirements.
– The selection of authorized traders should be based on risk
management techniques.
– Harmonization and mutual recognition of authorized traders schemes
with partner countries should be pursued to the extent possible.
• Coordination of border control procedures should be given
special attention to ensure that clearance of documents and
physical control of consignment by all agencies are conducted at
a single point and time. Coordination and cooperation may
further include the alignment of working days and hours,
development and sharing of common facilities, and development
of procedures for exchange of non-confidential information.
•