Learn Important’s Language

Latin word which means according to value. Customs duties and taxes are calculated on the basis of value. In other words, ad valorem tariff is calculated according to value or as a percentage of the value of goods.

A bank that notifies or advises the exporter that a credit has been opened in the exporter's favour. The advising bank, usually located in the exporter's country, informs the exporter of the conditions of the documentary credit without itself making a payment commitment.
See also "Documentary Credit"

A person or an entity authorized to undertake a business transaction for and on behalf of another person or entity. Different names lik a broker, commission agent, sales agent, manufacturer's representative, buyer's agent are used but essentially they acted in the same capacity, i.e. acting for and on behalf of another party.

A type of insurance coverage that excludes only the risks that have been specifically outlined in the contract, otherwise it means that any risk that is not specifically omitted is automatically covered. In short, it is the broadest form of coverage for any loss of or damage to the cargo during the transit. It should be noted that coverage on War, Strikes, Riots and Civil Commotion (W&SRCC) is also always excluded in all forms of insurance coverage unless separately and specifically covered. This term is now being phased out and the new term "Institute Cargo Clause (All Risks)" is now being used instead.

Duty imposed to offset the amount or margin of dumping. The introduction of this duty is to protect the domestic market from being made use of by certain foreign manufacturers in disposing their products, thereby destroying the pricing mechanism of that certain products.

A process of dispute resolution 1n which a neμtr_§) third party (arbitrator) renders a decision after a hearing at which both parties have an opportunity to be heard. Arbitration may be voluntary or contractually specified ·n writing. The advantages of arbitration, as compared to litigation, are neutrality, confidentiality, reduced costs, faster procedures and the arbitrator's expertise in specific areas. Internationally, the main arbitration body is the International Chamber of Commerce; other arbitration institutions include the London Court of International Arbitration. Malaysia has an arbitration center - Kuala Lumpur Regional Center for Arbitration.

A term commonly used in connection with a transport document, more frequently with Bill of Lading. it involves the transferring of rights, title and interest in order to assign goods by the endorsing the Bill of Lading or any other transport document.

'Admission Temporal/Temporary Admission'. An international customs document for the temporary duty-free admission of goods into a country for display, demonstration or similar purposes. ATA Carnets are issued by National Chambers of Commerce, which guarantee the payment of duties to local customs authorities should the goods allowed In are not be ultimately re-exported.

A negotiable instrument that represents an unconditional demand for payment. Together with B/L it forms the basis for documentary collection procedures and together with exporter's commercial invoice it can be used to demand payment from importer for the goods. Definition from Bill of Exchange Act states: "An unconditional order in writing, addressed by one person to another, signed by the person giving it requiring the person to whom it is addressed to pay on demand, or at a fixed or determinable future time, a sum certain in money to or to the order of a specified person, or to a bearer'. A bill is signed by a drawer acid addressed to a drawee, who becomes the acceptor by writing their name across the face of the bill. The person to whom the bill is payable is referred to as the payee.

An undertaking, usually in legal format, by a person or entity who binds himself to the authorities (more frequently the Customs) to conduct his commercial transaction or the act of doing so, as specified by the law, regulations or conditions. Sometimes, referred to as Customs Bond.

Imported goods that are stored in a bonded warehouse, usually after the owners of the goods have not found a buyer for the goods yet and would withdraw the goods after finding a buyer or reexported out to another country. Should the goods be sold to a domestic buyer, the owner of the goods would pay the appropriate duty/tax, unless the buyer has already obtained an exemption from the customs authority.

A payment at sight of documents presented. When an indicated invoice amount to be paid by the 0uyer I importer at sight on commercial documents (e.g. bill of lading, insurance certificate, etc.).

See lncoterms.

See lncoterms.

A payment before a delivery takes place. Rather simffar to COD, except that delivery is usually not effected until payment is received.

A certificate of health or health inspection certificate may be required by an overseas buyer or by the authorities in the buyer's country. Usually, an official health certificate issued by the export-side health authority states that the animal exported out of the country is healthy, free from signs of infectious or contagious diseases and signs of internal and/or external parasites, and meets the specific requirements staled in the regulations of the exporting country.

A document issued by an insurance underwriter to the exporter (or the freight forwarder) to provide evidence that insurance against loss or damage of the goods to be exported has been obtained. A "Certificate of Insurance" has no legal standing and usually banks insist on obtaining the Insurance policy, in which case is a legal document.

A document Issued by a competent authority that certifies the country where the product was made in. A Certificate of Origin is sometimes required by the importing country's authorities to prove that the goods originate from a particular country. This may be necessary to enable an Importer to claim preferential Import duty, in which case, it is known as "Preferential Certificate of Origin (PCO)". A competent authority may be the National Chamber of Commerce or Department of Trade or Industry. In case of Malaysia, PCO is issued by Ministry of International Trade and Industry, whilst normal Certificate of Origin is issued by the respective Chambers of Commerce (like ACCCIM, MICCI or FMM).

A document issued by the shipper I supplier I intermediary-to certify the state of conditions of the goods prior to delivery or shipment. In order to verify to the receiver I consignee I other intermediaries (like bank or customs authority) that the stipulated conditions are complied with. Maybe used by a different party in a differing situation, including certifying different parts of a journey covered under a through BIL, certi_fying cargo shipped for storage at an intermediate location/warehouse, etc.

Abbreviation for "Completely Knocked Down". Different parts and components are shipped to one plant for assembly into a final product.

See lncoterms.

Goods are imported where Customs authority approves the importation for free circulation in a country, upon compliance of all regulations and payment of duties and taxes, to any.

A payment at a point of delivery. Where small value goods are sent by post I courier and are released only after payment of the invoice plus any COD charges, if levied.

An invoice covering a shipment of goods certified (legalized) by the consul of the country for which the goods are destined. The invoice is used by customs officials of the country to verify the value, quantity and nature of the goods Imported for the computation of import duty. In addition, the export price may be examined by the consul to ensure that dumping is not taking place.

A document containing commercial transaction between a seller (exporter} and a buyer (importer), comprising of information such as a complete listing and description of the goods including prices, discounts and quantities, and the delivery and payment terms. A commercial invoice is generally used by customs to determine the true value of goods for the assessment of customs duties and must therefore, conform to the regulations of the importing country. See more in 3.2 International Shipping Terms.

In documentary credit transactions, the bank which adds its own irrevocable undertaking for payment in addition to that given by the issuing bank. The confirming bank is usually located in the exporter's country. See also Documentary Credit

A common tariff uniformly applied by a common market or customs union (such as EU, Mercosur) for imports from ceuntries outside the group or union. This is to prevent the re-exportation from one member country to another, this unifying the tariff .

See lncoterms.

See lncoterms.

A consignment note with a standard set of transport and liability conditions, as provided under CMR convention. Unlike the BIL, a CMR note is not a document of title but merely a receipt of goods by the road carrier and a contract of carriage existed between the carrier and the trader.

Abbreviation for "Convention relative au contrat de transport international de marchandises par route" (in French) which translates as "Convention on the Contract for the International Carriage of Goods by Road". The CMR Convenjion is an international convention that was signed on 19 May 1956. It relates to various legal issues concerning transportation of cargo by road.

A simplified set of document, usually issued by an insurance writer or broker to the exporter, confirming the status ot insurance coverage on the goods as declared therein.

An exclusive right granted by a government authority for a spectfied period to the creator of literary or works of art, such as books, articles, drawings, charts, musical lyrics, recordings, motion pictures and computer programs.

CIM Convention Abbreviation for "Convention Internationale concernant le transport des Marchandises par chemln de fer" (In French) which translates as "International Convention concerning the Carriage of Goods by Rail". This convention is evolved to be Appendix B to the later convention COTIF.

A unique identification code which identifies an Exporter or Importer approved to use certain customs procedures.