Foreign Trade Flashcards
What is meant by international or foreign trade.
When there is any dealing in goods or services between two or more countries, it is called Foreign Trade.
0.2
What are the difficulties of foreign trade.
Ans. (i) Remittance of price (ii) Govt. restrictions (iii) Diversity of language (iv) Heavy taxes/duties
(v) Long distance (vi) Costly transportation
0.3
What is meant by a bill of lading.
Ans.
A bill of lading is a very important document used in the overseas merchandise transactions. It is a receir issued by the steamship agent representing the title the goods when they are on the high seas.
Bill of Lading:
If goods are to be dispatched by ship from one place to another, the receipt issued by shipping company is called bill of lading. Bill of lading represents the title to the goods. Goods is presented to shipping company. Exporter or his forwarding documents such as the invoice and insurance policy.
Bill of lading contains all the data pertaining to the shipped merchandise. It includes:
Name of exporter.
(il) Name of importer.
(it) Name of ship on which goods are loaded. (iv) Type of goods.
(v) Quantity of goods. (vi) Mark of packing.
(vii) Name of the port where goods are to be unloaded.
IMPORTANCE
A bill of lading serves the following purposes:
(a) It is a legal receipt of the goods shipped;
(b) It is an evidence of the contract of carriage;
(c) It is the document of title to the goods;
•(d)
It is transferable and can be presented as security to bank for obtaining loan.
(e)
Bill of lading provides guarantee that the goods will be delivered to that person whose name is written in it.
TYPES
There are two types of bill of lading:
(i) Clean Bill of Lading:
If the captain of vessel is satisfied with the packing of goods then he signs bill of lading without writing any comment on it, it is called clean bill of lading. (
ii) Foul bill of Lading:
If the captain of vessel writes any comment on bill of lading regarding his dis-satisfaction about packing of goods then it is called foul bill of lading.
Example:
Imagine a company in Dubai buys goods from China.
1. The seller in China ships the goods and gets a bill of lading from the shipping company.
2. The seller sends the bill of lading to the buyer in Dubai (often through a bank, if payment is involved).
3. When the goods reach Dubai, the buyer must present the bill of lading to claim them.
Without the bill of lading, the buyer cannot take the goods, even if they have paid for them! That’s why it’s called a “title of goods”—it proves who owns the shipment.
List down the contents of a bill of lading.
Ans.
Bill of lading includes:
(i) Name of exporter. (ii) Name of importer.
(iii) Name of ship on which goods are loaded. (iv) Type of goods.
(v) Quantity of goods. (vi) Mark of packing.
Q.s
(vii) Name of the port where goods are to be unloaded.
Explain the types of bill of lading.
Ans,
There are two types of bill of lading: (i)
Clean Bill of Lading:
If the captain of vessel is satisfied with the packing of goods then he signs bill of lading without writing any comment on it, it is called clean bill of lading.
Foul bill of Lading:
If the captain of vessel writes any comment on bil of lading regarding his dissatisfaction about packing of goods then it is called foul bill of lading.
The captain of a vessel (also called the ship’s master) is the highest-ranking officer on a ship. They are responsible for the overall operation, safety, and navigation of the vesse
What is meant by invoice.
Invoice is an important business document which is made out by the seller/exporter containing full information about the description of goods, the date of sale, the terms on which the goods are sold and full address of the buyer and seller.
Q.7
Ans.
What is meant by certificate of origin.
When there is an agreement between the countries for less import duty then it is necessary for exporter to less import duty then it is import duties or imposing secure a certificate called Certificate of Origin.
Q.8
Ans.
What is meant by the bill of entry.
The importer or agent provides information or detail of imported goods to custom authority to pay custom duty.
This detail or information about imported goods is called Bill of Entry.
Q.9
Explain the black, white or blue bill of entry.
Ans. (i) Blue bill of entry is used for goods to be sold
within the country.
(ii)
Black bill of entry is used for the goods exempt from custom duty.
(iii) White bill of entry is used for the goods to be re-
exported.
Q.10
What is meant by letter of indemnity.
Ans. It is a document which insures a person or firm for the compensation of loss in case of happening of certain events. Sometimes, the goods reach to port before
receiving bill of lading In this case, the importer favour of charter company.
collects in greds ompany letter of indemnity in the
What is meant by Bill of Sight.
I
If the importer has not received the documents regarding the goods i ported, then he requests the authorities to inspect the goods in their supervision. This request is known as Bill of Sight.
0,12
Define Letter of credit.
Letter of credit is an instrument issued by the buyer’s
AnS.
bank authorizing the seller to draw in accordance with certain terms and conditions.
Q13
What is meant by charter party.
ANS.
It is an agreement according to which the whole ship or major part of it is reserved for exporter to carry his goods to a particular place at an agreed freight. A charter party may be:
(i) A voyage charter party for a particular voyage.
(i) A time charter party for a specific period.
Q14
What is meant by Bills of exchange.
Ans.
Bill of exchange is an unconditional order of seller to buyer to pay a certain sum of money on demand or at a fixed future time.
015
Define consular invoice.
Ams.
Consular invoice is a certificate which shows that the value of the exported goods mentioned therein is comect. This certificate is issued by consular office sitated in exporting country.
