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International Logistics > Exam 2 > Flashcards

Exam 2 Flashcards

1
Q

seller makes goods available at seller premises. seller not responsible for loading the goods on Buyers vehicle or for clearing goods for export (unless otherwise agreed upon)
Buyer bears all risks and costs in taking goods from seller’s premises to destination

A

Ex Works

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2
Q

seller obligated to get the goods over the ship’s rail at the port of shipment. Buyer bears all costs and risks of loss from that point. seller must clear goods for export

A

FOB (Free on Board)

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3
Q

seller must pay cost and freight necessary to get goods to named port of destination. Risk of loss and any additional costs after goods delivered to the vessel are transferred to the Buyer when goods pass the ship’s rail. Seller must also obtain marine insurance and clear goods for export

A

CIF (Cost, Insurance, and Freight)

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4
Q

seller obligated to deliver the goods alongside the vessel on the quay/pier at the named port of shipment
buyer bears all costs and risks loss from that moment
seller must clear the goods for export

A

FAS (Free Alongside Ship)

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5
Q

seller delivers at named place in country of importation

seller bears risks and costs, including duties, taxes, and other charges

A

DDP (Delivered Duty Paid)

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6
Q

the seller ships the goods together with the necessary documents to the buyer before the payment is made and without any form of guarantee. when the goods have been dispatched, the seller also sends the buyer an invoice asking for payment within the agreed credit terms

A

Open account

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7
Q

the seller asks his or her bank to obtain the payment from the buyer (through the buyers bank) in exchange for related shipping documents

A

documentary collections

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8
Q

one of the most commonly used methods of payment. offers the seller the security of knowing that he will be paid while offering the buyer the assurance that payment will only be made when his bank is presented with documents that keep to the agreed terms
buyer acts first

A

letter of credit

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9
Q

the buyer is given the documents when a payment is made to the bank

A

D/P (Document Against Payment)

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10
Q

the documents required to take possession of the goods are released by the bank only after the buyer accepts a time draft drawn upon him

A

D/A (Document Against Acceptance)

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11
Q

releases the payment once the buyer has confirmed the collection of goods

A

Issuing Bank

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12
Q

acts on behalf of the seller, and has to confirm whether the L/C is in order

A

Acquiring/Advising Bank

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13
Q

seller requests payment from the buyer before he will ship the goods. The seller only ships out the goods to the buyer after receiving the payment.

A

Payment in Advance

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14
Q

Riskier than open account

A

Sale of Consignment Basis

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15
Q

ask another bank to confirm LOC

A

Confirmed Letter of Credit

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16
Q

a negotiable instrument which buyer signs

A

Bill of Exchange

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17
Q

Cannot be changed without the consent of all parties (term of payment)

A

Irrevocable LOC

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18
Q

Can be changed without the consent of all parties (term of payment)

A

Revocable LOC

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19
Q

used to discourage importas and increase their costs, sometimes to the point wehre trade is no longer profitable

A

non-tariff barriers

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20
Q

a document that states a commitment on part of the seller to deliver the products or services as notified to the buyer for a specific price. not a true invoice

A

pro-forma invoice

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21
Q

a legal document bw supplier and customer that clearly describes the sold goods, and the amount due

A

commercial invoice

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22
Q

a certificate, typically provided by the government of the exporter, certifying the nationality of the cargo

A

Certificate of Origin

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23
Q

permission for sample goods to enter without paying duties as regular cargo

A

carnet

24
Q

protects carriiers and crew from liability for negligent ship management and navigation

A

Nautical Fault Defense

25
Q

part of SCM and an important quality control method for checking the quality of goods clients buy from suppliers

A

Pre-shipment inspection

26
Q

the most important document in the entire process. this is a document of title, a receipt of goods, and a contract of carriage. can be transferred by endorsement to third parties

A

Bill of Lading

27
Q

no notions by the carrier of problems, otherwise it is foul

A

Clean Bill of Lading

28
Q

signed by the carrier that it is loaded

A

Onboard Bill of Lading

29
Q

means only that is was received

A

Received-for-shipment Bill of Lading

30
Q

non-negotiable, cargo delivers only to the cosignee

A

straight Bill of Lading

31
Q

Created by forwarder, who is acting as an intermediary

A

forwarder’s bill of lading

32
Q

simmilar to the BL, but does not convey title. Mostly for air cargo

A

Waybill

33
Q

commonly used in food shipments to certify that it is gygenic

A

Sanitary Certificate

34
Q

essentially the same thing as a commercial invoice, but has all the specific pieces of info needed by customs

A

Consular Invoice

35
Q

the right of an individual or organization that publicly advertises itself for hire of the transportation of goods to keep possession of the cargo it has delivered to a destination until the person who is liable to pay the cost has done so

A

Carrier’s lien

36
Q

seller can fix the problem and the right to additional time to perform

A

Right to remedy

37
Q

a buyer can simply not accept a shipment if there is a breach, but this may only be done after the seller has been notified

A

right of avoidence

38
Q

a financial protection plan that provides coverage for goods in transit by sea. vessel transporting cargo must be in good condition and vessels crew must be competent

A

Voyage Policy

39
Q

neglegence from shipper (risk)

A

inherent vice

40
Q

people not pay for this. every buyer needs this. depends on the terms of sale

A

insurable interest

41
Q

security or protection against a loss or other financial burden

A

indemnity

42
Q

the right for an insurer to legally pursue a third party that caused an insurance loss to the insured. This is done as a means of recovering the amount of the claim paid by the insurance carrier to the insured for the loss

A

Principle of subrogation

43
Q

a key principle of insurance and is concerned with how the loss or damage actually occured and whether it is indeed as a result of an insured peril

A

Proximate cause

44
Q

when cargo is sold in a foreign market at below market prices, normally to eliminate the competition

A

dumping

45
Q

refers to the practice of importing a product contrary to the wishes of the producer who normally has their oficcial distributor

A

Gray market importing

46
Q

a way that customs can control the amount of a product that is imported

A

quotas

47
Q

states an amount that may be imported at a given tariff rate and beyond that a different/higher tariff rate applies

A

tariff rate quotas

48
Q

states a given quantity that may be imported

A

absolute quota

49
Q

customs wants one entity that can be held responsible for a shipment. this is the one party held responsible for fulfilling most of the regulations associated with customs compliance

A

importer of record

50
Q

a book which lists how much is charged for imports depending on the product and country of origin

A

Harmonized Tariff Schedule (HTS)

51
Q

generally where Customs exercises its controls. where importers/exporters must produce the documents that will allow them to move their cargo and where customs is most likely to inspect or seize cargo

A

Port of Entry

52
Q

the country where an article was grown, mined, produced, or manufactured

A

Country of Origin

53
Q

the price charged by one member of a multinational organization to another member of the same organization for the provision of goods or services of a property

A

transfer pricing

54
Q

a bond given by an importer for payment of damage resulting from failure to comply with the customs laws and regulations

A

customs bonds

55
Q

GATT in 1994 agreed on country-of-origin rules, in which the country of origin is the last country where the product underwent a change that meant a new tariff classification

A

tariff shift rule

56
Q

to let commodities which are subject to taxation be exported and sold in a foreign country on the same terms as goods from countries where they are untaxed

A

duty drawback

International Logistics (3 decks)

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