PROCESSING AN EXPORT ORDER INTRODUCTION

Export order must confirm to the terms of contract and then sent to the o erseas !u"er# $ut !efore its confirmation% it must !e scrutini&ed 'ith re(ards to products and their specifications% terms of pa"ment% price% de)i er" schedu)e etc#

The immediate tas* of exporter is to ac*no')ed(e the export order 'hich is different from its acceptance # Then he shou)d proceed to examine the export order 'ith respect to fo))o'in( parameters#

+# Nature , Export order is a document% communicatin( the decision of forei(n !u"er to purchase items from exporter# It 'ou)d c)ear)" indicate the exporter-s pro.forma in oice/0uotation num!er and its date% inc)udin( item% 0uantit"% price% de)i er" date% shippin( mar*s% insurance% pa"ment terms% documents re0uired etc# $efore acceptance% the export order shou)d !e scrutini&ed in a)) aspects

1# Ac*no')ed(ement , The exporter shou)d 'rite a simp)e )etter to o erseas !u"er than*in( him for the export order and statin( that the confirmation of the same 'ou)d !e sent soon#

2# Scrutin" ,

The export order shou)d !e carefu))" scrutini&ed in terms of pro forma in oice/contract sent to the forei(n !u"er% on the fo))o'in( aspects, The order has !een recei ed for same products for 'hich 0uotation/offer 'as sent# Si&e and specifications are a)so as per 0uotation/offer# Unit measurement needs to !e specified as 'e))# It cou)d !e num!ers% o)ume% or 'ei(ht# Ordered 0uantit" !oth in 'ords and fi(ures# This is essentia) to )ea e out an" room for confusion# Pre.shipment inspection is as per a(reed in pro forma in oice# Pre.shipment inspection can !e done !". Exporter Inspection !" exporter nominated a(enc" Inspection !" importer nominated a(enc" Export Inspection A(enc" 3EIA4 GOI authori&ed a(enc" The inspection agency has to be agreed upon in pro forma invoice

Pa"ment conditions are same as stipu)ated# The order must pro ide a)) the detai)s re)atin( to *ind of pac*a(in( re0uired inc)udin( the )a!e)s and the mar*s to !e put up# The instructions ha e to !e exp)icit specif"in( re0uirements in fu)) detai)s as there cou)d !e separate )a!e)s for the artic)es and for pac*a(in(# Shipment and de)i er" date is in conformit" 'ith the exporters production p)an#

Documents re0uired are in conformit" 'ith those mentioned in pro forma in oice# Genera))" fo))o'in( documents are re0uired, $i)) of Exchan(e $i)) of 5adin( Certificate of Ori(in Pac*in( 5ist Insurance Po)ic"/Certificate

6# Confirmation , If the exporter is satisfied on arious aspects mentioned in the export order he shou)d send a forma) confirmation to the o erseas !u"er#

7# C)arification , If the exporter is not comp)ete)" satisfied 'ith the terms of export order% c)arification shou)d !e sou(ht from the !u"er !efore its confirmation# The c)arification cou)d !e in terms of ,

8uantit" De)i er" schedu)e

Terms of pa"ment INCO terms etc#

The de)i er" period shou)d !e specific and not in terms )i*e 9immediate de)i er"%: or 9as soon as possi!)e#:

Contents of Export Contract

+# Product description and Specifications Inc)udes products name% technica) name% 0ua)it" specifications and (rade% detai)s as to standards% si&es% reference to samp)es and their specifications#

1# 8uantit" Ordered 0uantit" !oth in 'ords and fi(ures# This is essentia) to )ea e out an" room for confusion#

Unit measurement needs to !e specified as 'e))# It cou)d !e num!ers% o)ume% or 'ei(ht#

In addition care shou)d !e ta*en 'hi)e statin( the unit of measurement in internationa) or countr" specific terms% for examp)e% ;etric Ton is +<<< *(s# 'hereas the US Short Ton is =<> *(s# and the $ritish 5on( Ton is +<+? *(s#

2# Pac*a(in( 5a!e)in( and ;ar*in(

The order must pro ide a)) the detai)s re)atin( to *ind of pac*a(in( re0uired inc)udin( the )a!e)s and the mar*s to !e put up# The instructions ha e to !e exp)icit specif"in( re0uirements in fu)) detai)s as there cou)d !e separate )a!e)s for the artic)es and for pac*a(in(#

In each case of mar*in(% information that has to !e indicated on each pac*a(e shou)d !e in easi)" reada!)e in*% (i in( the name of the consi(nee% contents of the pac*a(e inc)udin( name of the product% net and sometimes a)so the (ross 'ei(ht% countr" of ori(in etc#

6# INCO terms% Price and @a)ue The tota) a)ue of order needs to !e c)ear)" stated !oth in num!ers and 'ords in the decided currenc"# Price 'ou)d of course depend upon terms of de)i er" and for this (enera))" INCO terms are used#

7# Taxes% Duties A Other Char(es Bho 'ou)d !ear 'hich tax depends er" much on ho' the prices are 0uoted and herein INCO terms !ecome re)e ant#

?# De)i er" Period It is important that contract do c)ear)" indicate stipu)ations 'ith re(ard to de)i er" period# The de)i er" period shou)d !e specific and not in terms )i*e 9immediate de)i er"%: or 9as soon as possi!)e#: In case of )ate de)i eries the importer can insist upon the pa"ment to !e made !" the exporter !" 'a" of )i0uidated dama(es% a sum e0ua) to certain C of the contract price for e er" 'ee* of de)a"#

># Consi(nee Detai) If the consi(nee is different from the !u"er% his comp)ete name and address is re0uired#

D# Transfer of Ris* INCO terms define the point at 'hich ris* passes on from exporter to importer#

Un)ess other 'ise a(reed !et'een the parties% the ris* passes from the exporter 'hen the (oods are handed o er to the first carrier for transmission to the importer#

=# ;ode of Pa"ment The contract shou)d c)ear)" indicate the mode of pa"ment. 'hether it is 5/C% or Documentar" Co))ection D/C% or Document on Acceptance D/A#

+<# Inspection C)ause If a !u"er 'ants a pre.shipment inspection carried out% it must !e mentioned in the contract# The detai)s of the inspection a(enc" must a)so !e (i en#

++# Test Certificate At times% the importer ma" as* the exporter to conduct certain test son the materia)% for examp)e% a co)our !)eed test on fa!ric% and su!mit a test report !" a prescri!ed a(enc"# This must form a part of the contract#

+1# Commission/Discounts In case exporter is re0uired to pa" an" *ind of commission or offer an" discount to the !u"er or his a(ent% the export order must pro ide detai)s of the same#

+2# Insurance The contract must c)ear)" pro ide insurance instructions for the exporter% if he is to arran(e insurance# In case the !u"er is responsi!)e for insurance% the order must sa" so#

+6# Documents Re0uired The export contract must specif" a)) documents re0uired to !e su!mitted !" the exporter to the importer# The exporter then has to comp)" 'ith a)) the documentation re0uired er" re)i(ious)"# Genera))" fo))o'in( documents are re0uired,

Shippin( Ad ice Commercia) In oice

$i)) of Exchan(e $i)) of 5adin( Certificate of Ori(in Pac*in( 5ist Insurance Po)ic"/Certificate

+7# EForce ;aGeure- c)ause Force ;aGeure )itera))" means 9(reater.force:# This c)ause excuses a part" from )ia!i)it" if some unforeseen e ent !e"ond the contro) of that part" pre ents it from performin( its o!)i(ation under contract#

T"pica))" force majeure c)auses co er natura) disasters or 9Acts of God:% 'ar etc#

It is important to remem!er that force majeure c)auses are intended to excuse a part" on)" if the fai)ure to perform cou)d not !e a oided !" the exercise of due care !" that part"#

Internationa) Cham!ers of Commerce ia ICC Pu!)ication No# 61+ has enumerated the fo))o'in( circumstances as the one in 'hich the force maGeure c)ause 'i)) !e app)ica!)e ,

Bar% ci i) 'ar% riots and re o)utions% acts of pirac" Natura) disasters such as io)ent storms% c"c)ones% earth0ua*es%tida) 'a es% f)oods% destruction !" )i(htnin(# Exp)osions% fires% destruction of machines of factories and of an" *ind of insta))ations# $o"cotts% stri*es and )oc*outs off a)) *inds%(o.s)o's%occupation of factories and premises and 'or* stoppa(es 'hich occur in the enterprise of the part" see*in( re)ief#

+?# Ar!itration C)ause For sett)ement of disputes t'o options are a ai)a!)e. Either (o to Court of 5a' Or ma" chose to resort to ar!itration

In internationa) tradin( transactions% parties norma))" do not )i*e to (o to courts and instead decide to (o to Ar!itration#

The fact that the disputes are to !e sett)ed !" resortin( to Ar!itration shou)d !e c)ear)" stated in the export contract% a)so mentionin( therein 'hether Ar!itration 'i)) !e in accordance 'ith Internationa) Cham!er of Commerce ru)es or the ru)es set out !" UN Commission on Internationa) Trade 5a' 'i)) !e app)ica!)e#