Attestation of Delivery Documents

Some applicants request a document that is one of documents that is stated on an L/C. This kind of document is issued by Forwarder. The name of this documents is Attestation of Delivery Documents.

Usually on the L/C says:
"
ATTESTATION OF DELIVERY DOCUMENTS ISSUED BY FORWARDER CERTIFYING THAT COPY OF PACKING LIST HAS BEEN RECEIVED BY HIM ON SHIPMENT DATE FOR IMMEDIATE TRANSMISSION TO FORWARDER'S AGENTS AT DESTINATION.
"

After shipment date or flight or vessel has been departed from port of loading, shipper will ask forwarder to issue this kind of document as a required documents refer to the L/C.

This document and other required documents will be sent to the advising bank to be forwarded to the issuing bank to get release payment.

Here I have ever gotten a sample of Attestation of Delivery Document from a forwarder.
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They Forgot CIF Term

CIF, or Cost, Insurance, Freight, is one of trade terms, both buyer and seller should understand correctly from the beginning when they issue a sales contract.

Sometimes sellers don't fulfill their obligation if consignee or buyer doesn't reminds them. For example, especially for trade that doesn't cover by L/C, let say the payment is T/T before shipment, they sometimes forget to provide an Insurance Certificate to cover the goods until port destination. Whereas the shipment term is CIF, means shipper or exporter should provide Insurance Certificate.

We have to remind shipper each time they make a booking for shipment to the forwarder. If we, buyers forget to remind them, they only give or send Invoice, Packing list, Bill of Lading. In Indonesia, then consignees have to issue the Insurance Certificate as one of required documents for customs process. Yes, it happened, or maybe a lot cases happened such.

CIF is one of trade terms where all the costs including Insurance and Freight cost from port of loading until port of discharge are for seller or shipper obligation. I don't understand well why they commonly forget the Insurance Certificate.

For you maybe as a seller, I hope you can keep in mind all the trade terms meaning and condition. For especially CIF, if you will not issue an Insurance Certificate, please take the C&F trade term to sales contract instead.    

  

Documents Required for Shipment to Canada

Beside the common shipping documents required for exportation to other country such as bill of lading, some additional documents are needed to provide when we are going to export some goods to. Personally, I seldom handle a shipment to Canada, in fact shipment to Canada need more extra efforts to keep our exportation to be going on safety. I don't know whether buyers from Canada have the same rule or manual. As I have informed on previous posting, in handle an order form Canada need more efforts to pass the order to smooth condition due to low tolerance from buyer and fully of discount.

In this posting, I want to let you know about the require documents when we make a shipment to Canada:

1. Original and some copies of commercial invoice that indicating 'Standard Export packing'.
2. Certificate of origin. The type of this certificate of origin is Form B.
3. Beneficiary's certificate. This document created by seller or manufacturer and should be in signed condition. This certificate stating that production samples have been sent to applicant.
4. Applicant's letter to beneficiary that stating that sample was received.
5. Packing list in both original and photocopy.
6. Inspection certificate, which evidencing that goods have been inspected prior to on board date and ware found to be as ordered by applicant.
7. Canada customs invoice in both original and photocopy.
8. Bill of lading.
9. Textile declaration or single country declaration, which declare that all information stated on this document are true. The information marks, goods description, description of manufacturing, country of manufacturing, date of exportation, and materials are stated on.
10. Certificate of conformity. Beneficiary certifying that the goods or product meets the requirements pertaining to the Flammability Testing Standards established by the Customer Product safety Commissions under the Consumer Product Safety Improvement Act.

Credit Note

Contrary with debit note, credit note is reverse form debit note. To make easy in understanding of credit note, I will give a sample in business nature.

A buyer send a package that containing some buttons. In agreement between buyer and shipper stated that all accessories and the courier fee are have to be covered by shipper. But, the fact that buyer provide the buttons and send the buttons to shipper by using a courier under buyer's account. Of course, all charges including buttons and its courier fee will have to return back to buyer by shipper.

In this case, shipper as a manufacturer or beneficiary party will issue a credit note. This credit note as notice that shipper will pay some amount as reimbursement to buyer. 

In issuing a debit note, we'll need the following information:

1. Beneficiary name and address. 

2. Beneficiary bank details.

3. Destination of the payment.

4. Credit note number.

5. Date of issue of credit note .

6. Description.

7. Total amount.

8. Term of payment.

Sometimes a credit note stating that beneficiary agree to pay the amount of credit note within a period of time, such as, 30 days after issuing date of the credit note.Usually, beneficiary creates a credit note with letter head inserted on.

Debit Note For Reimbursement

This posting containing my opinion based on my experience. If any differences meanings to this opinion of the debit note, I will be happy to take it to be a good reference. 

We create a debit note when we want to take reimbursement from any party, which we have paid any charge for. For example, a company send us a goods through any courier, which is using our account. As a result, the invoice of the courier charge will be going to us. Because the courier charges actually have to be paid by shipper, of course, we have to take our money back from the shipper. The way to do that, we need to create a debit note for shipper. Based on these debit note, shipper will return our money back by any method of payment as both parties agreed.

Contents of debit note is likely invoice. These contents are issuing of the debit note, payer, date of issue, debit note number, description of charge, amount to be paid, bank details including the account number, and signature.

However, sometimes a reimbursement inserted to another invoice. For instance, a buyer order some goods to us, let say sweater. When the goods are ready to export to buyer, shipper will issue the invoice or proforma invoice. If any amount should be returned to us, then we can also inserted to these invoice based on agreement between buyer and us. Therefore, we don't need to create a debit note in this case.

Case "TO ORDER OF SHIPPER" and "TO ORDER OF APPLICANT"

I have arranged the shipment to Japan for one of our buyer. We and the buyer agreed to use L/C for the order or trading. Before buyer instructs their bank to issue the L/C, they forwarded me the L/C draft for my checking.

During my reading and checking to the L/C draft, I found buyer wanted “TO ORDER OF SHIPPER “to be filled in the consignee’s column. This is making me to think two meanings when I instruct forwarder to arrange the B/L. The first meaning is "TO ORDER OF SHIPPER" wrote in consignee’s column. And the second meaning is TO ORDER OF our company name.

  

Finally, I decided the first choice or "TO ORDER OF SHIPPER" to be filled in the consignee's column on Bill of Lading. When I submitted all documents required to bank, Bank didn't found any discrepancy in Bill of Lading that I submitted to the bank.

To "TO ORDER OF APPLICANT" is something new for me and it’s seldom stated on an L/C. But, this was happened in our trade.

A buyer from Japan has changed their shipment manual concerning the consignee in Bill of Lading. They changed from "TO ORDER OF SHIPPER" becoming "TO ORDER OF APPLICANT". For our bank it’s something new, too.

I have followed the L/C, and I decided to fill in the consignee with "TO ORDER OF APPLICANT". Before the Bill of lading printed out, I have sent it to buyer to get their approval for the Bill of Lading content. Then buyer confirmed to the Bill of Lading.

After I collected and created all documents required as stated on L/C, I submitted the documents to our bank. Unfortunately, our bank found a discrepancy in Bill of Lading, specifically in consignee's column. The consignee should be TO ORDER OF “Applicant Name”. For example, let say the applicant name is ABC, then the consignee on Bill of Lading should be written with "TO ORDER OF ABC". This is because if we write the "TO ORDER OF APPLICANT", people who receive the Bill of lading will never know who is the consignee? So that the consignee name in details must be written on Bill of Lading.

Because of that, we got the discrepancy charges that will be deducted from the payment, and we have to persuade buyer to accept the discrepancy and release the payment when the documents arrived at their bank. 

Beneficiary's Certificate

Beneficiary's certificate is issued by exporter based on buyer or importer request. This kind of certificate is usually needs to issue especially for exportation to Europe union such as France. Almost our buyer from France requested this beneficiary's certificate that stated on the letter of credit or on the shipment manual they sent to us. However, not all buyer request us to provide this beneficiary's certificate. Some of them simply ask only packing list, invoice and bill of lading or air waybill to be provided.

There are various contents of beneficiary certificate. One buyer requested in different contents with another one. One of them ask us to issue a beneficiary's certificate of sending documents to a specific destination with a specific document and in a limit of time. Another one is requesting to provide the beneficiary's certificate of value contents of the goods to be shipped out. Or there is a buyer to mention on beneficiary's certificate doesn't contains a specific material to comply to their government's rules in importing any goods from around the globe.

For example we ever made a beneficiary's certificate for document sending with the the following contents :

"We beneficiary of Letter of Credit number certifying that : 

The following documents have been sent to the applicant's Indonesia office within ten days after shipment date :

1. Copy of commercial invoice.
2. Copy of packing list.
3. Copy of C/O Form A / GSP.
4. Copy of bill of lading or copy of air waybill.
5. Copy of AZO free coloring certificate.
6. Original certificate stating the exact composition of the goods.
7. Original certificate for item bearing accessories which contain nickel or original beneficiary certificate certifying that items do not bear accessories which contain nickel "

This is means that we have to send all above documents to buying agent within ten days after shipment date unless the discrepancy will comes up.

Concerning the beneficiary certificate of value content, we have made this kind of certificate with the following contents :

"We beneficiary of the following order certifying that the exact composition of the goods as follow:

Style number :

Order number :

Composition : "

This type of certificate showing the contents of the goods in " Composition"  for example we ever filled in with 100 percents of cotton for sweaters that the yarn's composition is cotton fiber.

We have ever made a beneficiary's certificate that mentioning no specific contents are found in the goods. The nickle is prohibit include to goods that exporting to France. The sample of this type of certificate as follow :

"We beneficiary of the following order certifying that below items:

Style number :

Order number :

Do not bear accessories which contain nickel. "

As a conclusion, a beneficiary's certificate is a statement from beneficiary or exporter to specific condition of the goods or shipment that are requested by buyer or importer for customs purpose to be going smoothly. Of course, shipper or exporter should respect in providing this document unless the discrepancy fee will came to exporter or beneficiary. In addition, the discrepancy will leads to the payment problem or even buyer will not be able to release the payment.

Download Beneficiary's Certificate

The Advantages of Letter of Credit

L/C is abbreviation from Letter of Credit that is issued by a bank based on applicant or importer request to be passed to exporter in abroad as their business relation. The exporter has an authorize to take the money through issue a draft ( a command for paying indebtedness ) to the importer for some amount of money as stated on the L/C. The issuing bank can accepts and can releases the payment as long as all requires as mentioned on the L/C could be followed by exporter or all terms and conditions are complying to the letter of credit.

The advantages of letter of credit :

• International transaction can be more easy.
• Funds that are provided by importer for their order putted in exporter will be safety. This because exporter can not takes the funds if there is discrepancy on the shipping documents presented by exporter even found one discrepancy. For instance, the description of the goods are not same with the L/C required.
• To ensure exporter provides the shipping documents completely. Exporters will give their efforts to provide the shipping document completely and comply to the letter of credit.
• Ensuring on keeping the delivery date in time. If exporter did not shipped out the goods in time, this will leads to discrepancy condition, then the importer may be did not release the payment.
• Ensuring fully quantity of the goods required are filling up. The quantity of the goods usually must be in tollerant range, sometimes importer can allow the quantities that are shipped out in more and less five percents. Exporter has to ship out the goods with the full quantities as the L/C mentioned up.
• To ensure the payment to order that is putted in exporter. Both exporter and importer sometimes don't know well to each others or occasionally they just have a business relation through an buying agent or importer never met with exporter. Of course, it's a big risk for exporter, what if importer did not release the payment while the goods have been received by them? Through this letter of credit buyer has a compulsory to pay or release the payment to exporter for the goods that have been exported as long as exporter has provided the shipping document with no discrepancy founded on the documents. Then bank will release the payment to the account of exporter. So that the L/C should be issued before the production are starting up.

To get the above advantages both exporter and importer have to check the L/C draft before the L/C is issued to avoid any discrepancies come up. Exporter has to check whether the L/C's terms and conditions are comply with rules in their country or not. And exporter has to check all documents format in its practice. If there is a content that is can not be followed by exporter they may ask importer to revise the L/C draft till exporter confidence in providing the shipping documents.

Issuing Bill of Lading

Bill of Lading or B/L is one of the transport document that is issued by a carrier or their agent or forwarder. Bill of Lading is the title documents that pointing the owner of the goods and each shipment by sea will has a Bill of lading. You can find the rule for Bill of Lading in UCP. Today the latest version of UCP is UCP600.

Before Bill of Lading is issued up, shipper will send a shipping booking or shipping instruction to forwarder or sometimes directly to shipping line. On the shipping instruction sheet shown the shipment data that will be used by forwarder for booking the space in a vessel. The fastest on sending this shipping instruction will keeping you on getting the space in a vessel more possible. The contents of a B/L will follow to the data stated on the sipping booking. Mostly, shippers send the proforma shipping booking which is containing an estimation only. Then in the event that the shippers have finished their production they will send the final shipping booking or final data to be inputted to the bill of lading by forwarder. The sending of this actual data commonly do on the injury time or close to the closing time of sending data. But, of course, sending the final data earlier is the better, especially for shipment to Japan. At this time our forwarder asked us to send the final data far away from the closing date, because if the shipment data is missing it can makes the container will not be loaded to the vessel.

The types of bill of lading that I have ever used are consisting ocean bill of lading, non negotiable sea waybill, and surrendered bill of lading. For exporting to Europe Union, the importers mostly use ocean bill of lading or bill of lading and Forwarder Cargo Receipt. 

Buyers or importers from Japan are usually use the surrendered bill of lading. They actually don't need an original bill of lading once they do the clearance of the goods, because the surrendered B/L that is sent by email or fax  is enough to do the clearance. I think the surrendered B/L is suitable for shipment from Indonesia to Japan that having about ten days sailing date, this short sailing date will take to a problem if they request an original bill of lading, because shippers need several days at least seven days to get the original bill of lading, possibility goods arrived before buyer getting the bill of lading from shipper, then the additional fee of storage will coming up to buyer.

Bill of lading contents :

• Shipper. Shipper will arrange the shipment booking and provides the data for each shipment and shipper also collecting all shipping documents to pass away to buyer or consignee.
• Consignee. Consignee is party of receiver for the goods that are shipped. Occasionally, the transport documents will be sent to them for clear the goods.
• Notify party. This party of bill of lading may same with consignee or sometimes is different with consignee. 
• Vessel name and its voyage. This will be shown on the forth column. For exportation to far away from Indonesia that the port origin is Indonesia, for instance to Europe or USA, two vessel will be typed on bill of lading, because the shipment used two vessel, first vessel is used from Indonesia to transit port and the second vessel is used from transit port to final port.
• Mark or shipping mark, container number and its seal. These data is showed at behind the left of the description of the goods. For LCL shipment type the container number and its seal data will be provided by consolidator of forwarder as the stuffing or loading the goods to the container do by consolidator or forwarder. Differently, FCL shipment, shipper will arrange the loading of the goods to the container, so that the container and seal number are provided by shipper. The shipping mark is always provided by shipper.
• Description of goods. Buyer will provides the description of goods for each order. This usually can be found on purchase order sheet.
• Nett weight and gross weight. Shipper will provides both data and pass to forwarder or shipping line to insert to bill of lading.
• Total container number and size and type.
• Place and date of issue. This date is usually same with the boarding date, but sometimes both date of issue and boarding date are different.
• Type of movement. This data are refer to loading type to the container. CFS/CFS movement will be shown if in one container consists two or more shippers and consists two or more buyer are included. CY/CY movement, means that in one container is used by one shipper only and containing one buyer. CFS/CY, if this type movement is showed on a bill of lading, means that the container are containing two or more shipper and only one buyer is included.
• Freight payable at. This is pointing to who is obligated to pay the freight.

All above data types have to follow instruction from buyer or the Letter of Credit.
 

Creating an Invoice

Shipper will creates an invoice based on the agreement prior to orders are putted to them. If buyer decided the term of shipment they wanted is " payment before shipment date and after inspection" In this case the invoice will be issued by shipper after inspection date and the payment should be received by them then they will directly arrange the exportation to destination as agreed. One of our buyer decided the payment term is on documents against payment , this mean the invoice will be performed once the goods were already been exported and after all documents required are completely provided then they will send the invoice along with the other documents to bank for arranging the payment.

The contents of an invoice that I ever made up as follow:

• Beneficiary. This party are commonly issue the invoice to be performs to buyer and also beneficiary as receiver of the payment from buyer.
• For account and risk of Messrs. This party is destination of the invoice performed. Commonly buyer are stated as to be this party. But sometimes buyer has decided the other name and address to be filled in this space. 
• L/C date, its number and the issuing bank. If the term payment are stated on L/C, those information are always stated on the invoice created up.
• Inconterm. This column will be filled in by FOB, FCA,C&F, CIF, Ex-work or others terms based on  both parties shipper and buyer agreed.
• Information of the carrier or vessel. Exportation from Indonesia to Japan is almost using direct vessel, so that the vessel is only one stated on this column. Differently, Exportation to Europe or USA is always has the vessel transits in Singapore or Malaysia, so that the vessel will be showed on the invoice are containing two vessels.
• Shipment route. The shipment route is consisting Port of  Loading, Port of transit, Port of discharge, and Place of Delivery. If the shipment is using direct vessel, the port of transit wouldn't be showed up. The shipment date is also showed on this column
• Consignee and applicant, Some buyer also decide to ask shipper to mention the consignee and notify party as showed on its B/L.
• Description of goods. The description of each goods are commonly mentioned on the purchase order, for instance " Ladies pullover 100% acrylic". A description of goods are consisting design or product name and composition.
• Style and order number. An order usually has an order or purchase order number and style number for identification purpose. So that the style and order number are very important things to be mentioned on each shipping and financing document as an identity of each order are putted to shipper.
• Color name and number. The color name and number are always mentioned on each invoice. Sometimes the difference color will leads to difference price of each color.
• Size. Mentioning size of each product in invoice is a must, because each size range usually has a specific price. The baby size will be different with the boy size, because material consumption for each size range will be different.
• Quantity of product. Quantities have to be performed on the invoice to calculate the total amount of each color, size, and all total quantities to be delivered to.
• Unit price. Of course, the unit price should be showed on each invoice to calculate the total amount to be paid by buyer.
• Total amount. The total amount of each shipment will be mentioned on the invoice. This is sometimes followed by total amount in words.
• Total quantities. Commonly, the total quantities are mentioned on invoice to show buyer what the actually quantities to be exported to them.
• Total box, the nett weight, gross weight, and its volume.Those information is not only important for buyer, but this is also using on the clearance process.

All those invoice contents are very important to give an attention when we are willing to create an invoice. And the correct contents will lead buyer can easily to process the payment, identification and of course, for the clearance the goods in customs.

In case you have an exportation of salesman to France, now customs will check the price once upon the exportation and payment process. It is a must to mention on both invoice for customs and payment in the same price. Our buyer in France reminded us to do this, because if this is not followed will leads to the penalty applied to buyer.

For all the above things, you have to contact constantly buyer regarding of invoice they want to create up. So that they can protect any unwanted thing happened to them. 

Packing List

A packing list performs a list of the goods or a products that is packed with a packing method. Packing list commonly is created on spreadsheet application like Microsoft Excel or any others. Sometimes buyer has decided the format of the packing list in their shipping manual to be used to each their order they have. If buyer doesn't has a certain format of packing list, shipper will makes a draft to propose to buyer for getting their approval including the content of each shipment.      

Now, some buyers have an online shipment system in a single window. They manage their orders by online system. Starting they put an order to a shipper till the goods are delivered of received by their warehouse, all these are recorded on their online system. Once shipper has finished produce their order, shipper submit the order data to be shipped out to the system covering quantity to be shipped out, the total packaging, the color, its nett weight and gross weight, packing method, and the shipment mode. Then the shipping marks and packing list will automatically created by system based on shipper data submitted to.

The packing list will be passed to buyer and bank in original, and it stated also on the first number of packaging, and occasionally the forwarder request the packing list to shipper, too. 

All contents on packing list stated are should be avoided from wrong. If found the wrong of the contenta it will become a big trouble and sometimes it will affect to the discount or penalty are coming to shipper. We have ever got some penalty because of this wrong thing. For several years ago our buyer from France has decided that the packing list should be written manually by hand. Of course, this is will becoming a big trouble when we don't have spare time to do this, because the closing time for cargo loading almost going over. Sometimes we didn't double check to the packing list we created up according to the short time to send the goods to the consolidator of the goods.

In addition, if we made a wrong content to the packing list and this has arrived in buyer hands or their agent, the extra handling can not be avoided. Then the additional handling fee in destination will born to shipper account.

  

Documents Against Payment is not T/T Payment

Documents against payment or sometimes called DAP is one of part of term payment in trade for especially in international trade. With using this payment term shipper or beneficiary or drawer having an obligation to provide the shipping documents as agreed that mentioned on purchase order or PO, and then send the documents through bank to pass to buyer's or consignee's bank. After consignee's bank received the documents, they proactively send a notification of this arrival. Before consignee can collect or pick the documents up they must settle the payment according notification from their bank then the documents for clearance the goods can be released.

This is important that don't proactively arrange the payment by transfer to shipper account directly. This will effect the payment status still in blank in your bank records, because this payment not follow the DAP line. Then the impact you can't release the documents. The such case was happened to our trade. View months ago one of our buyer from France putted an order or bought some sweaters  to us with a little quantities. Before the order is confirmed, they send us a sample to follow for making sample with some modifications and the measurements are included. Then we directly made the sample that followed their requirements and instruction. When the sample was being ready we directly send it to buyer to get their approval.

Fortunately they gave their approval and the purchase order was made up and sent to us by email. Then we sent them an order confirmation which was mentioning the payment term was in DAP or documents against payment and they have agreed of this payment term.  

After that we did further process to order the yarns as the raw material for knitting then the bulk production was done. After the production was finished and the quantity was full then we exported the goods with using a nominate forwarder that pointed by buyer. Then we made the transport document and finance document to send to our bank for beneficiary. We sent to our bank all documents require covering Bill of Lading , Certificate of Origin GSP Form A, Commercial Invoice, packing list, and consignee's bank details.

Our bank did not checked the contents of documents, because those documents were not under Letter of Credit or L/C. Our bank only checked whether the documents presented were complete or not. After that our bank sent them to consignee's bank. When the documents was already received and then the bank sent an the acknowledgement  to applicant or our buyer. 

Our buyer wired the payment to our account directly or this transfer is called T/T payment. Of course, this was wrong, they didn't arrange their payment by followed DAP line and this brought to impact they could not took the documents from bank, because the payment status is still empty. 

Many times they sent me an email to release the documents, we said that the documents will be released after they settled the payment. Then they sent a telex through their bank that mentioned that they have wired the payment and asked us to release the documents. When we received this telex from our bank we directly called our bank concerning this telex and our bank said that they was false by wiring the payment by T/T instead of follow the DAP line, so that their bank could not release the documents. Then I realized this situation or condition and directly instructed our bank to send a telex which is having the contents " We already received the payment in these amount and please release the document free of payment. All charges if any will born to applicant and our bank may close the file". Finally, our buyer as applicant could picked up the documents to release the goods from customs. 

This case show us that DAP is different with T/T payment and can not be mixed up one to each other, and by understanding both payment terms and conditions will make a short time in releasing the documents and of course, safe a couple of money.