Guidelines for Handling Ocean Export Shipments

When the export shipping transportation is conducted under CIF or CFR terms, with the seller arranging the shipment, the procedure is as follows:

Review Shipment Terms in Letters of Credit: To ensure smooth shipment operations, it is essential to examine the relevant shipment terms within the letter of credit upon receipt, such as the shipment period, settlement period, port of shipment, port of destination, whether transshipment or partial shipments are allowed, and whether a specific shipping company, vessel name, nationality, and classification are designated. Some letters of credit require the provision of various certificates, such as route certificates and nationality certificates. In considering acceptance or proposing modifications to these terms and regulations, I will take into account our country's policies, international practices, and the reasonableness and feasibility of fulfilling these requirements.

Inventory and Inspection Preparation: This involves preparing the export goods in accordance with the specifications, quantities, packaging, and other requirements stipulated in the export sales contract and the letter of credit, ensuring timely, quality, and quantity compliance. Special attention is required for refrigerated goods to maintain the required temperature during loading. In our country, all commodities listed in the "Category List" of the inspection and quarantine authorities, as well as those for which a certificate is required by the letter of credit or trade contract, must apply for inspection before export declaration by filling out the "Export Inspection Application Form." Some export commodities require weight certification, while others may need animal and plant quarantine or hygiene and safety inspections; these must be completed in advance and accompanied by a qualified inspection certificate. Once all pre-shipment preparations are completed and the necessary documentation is in place, the shipment process can be initiated.

Shipment Booking: By compiling an export shipment order, customers can proceed with entrusting freight forwarding agents to handle booking procedures. The freight forwarder sorts the orders according to the shipper's specific requirements by route and promptly books space with the shipping company or its agent. Shippers can also book space directly with the shipping company or its agent. Once the shipping company or its agent issues the loading order, the booking process is complete, indicating that a transportation contract between the shipper and carrier has been established.

Insurance: After the cargo space is confirmed, the buyer can proceed with the insurance application for the transportation of the goods. The insurance amount is typically based on the CIF price of the invoice plus an agreed-upon markup (the markup percentage is determined by the agreement between the buyer and seller; if not agreed upon, it is generally insured at an additional 10%).

Cargo Concentration in Port Area: Upon confirmation of the vessel's arrival and cargo loading schedule, the consignor shall complete the consolidation procedures as per the port's notification within the specified timeframe, and promptly transport the export goods to the port area for concentration, ready for loading. Ensure batch clarity, quantity clarity, and marking clarity. Pay particular attention to maintaining close communication with the port, shipping companies, and relevant transportation companies or rail units, to complete the cargo delivery on time and prevent any work disconnecting that could affect the loading progress.

Customs Declaration: After the goods are concentrated in the port area, the prepared export declaration form, loading list, invoice, packing list, inspection certificate, export contract, and foreign exchange settlement form, along with other relevant documents, are submitted to customs for export. The shipment can only be loaded after the customs officer examines and approves the documents.

Shipment Process: Prior to loading, the tallyman, representing the shipowner, collects the loading and receiving documents for the customs-clearance goods, organizes them, and then, based on the stowage plan and manifest, loads the goods in batches. During the loading process, a freight forwarder appointed by the shipper must be present to oversee the loading, monitor progress, and address any issues that arise. Upon completion of loading, the tally team leader must jointly sign the receiving bill with the chief officer of the vessel, and hand it over to the shipper. If the tallyman identifies any defects or poor packaging in a batch, they must note it on the receiving bill, which is then signed by the chief officer to determine the responsibilities of both the ship and the cargo. However, as the shipper, it is advisable to strive for a clean bill of lading by avoiding notations on the receiving bill.

Once the shipment is completed, the shipper, after notifying the consignee, can exchange the shipped bill of lading for the carrier or its agent with the consignment note, marking the end of the transportation process.

Document Preparation and Settlement of Exchange: Upon gathering the settlement documents stipulated in the contract or letter of credit, submit the documents to the bank within the negotiation validity period as specified in the contract or letter of credit to complete the settlement procedure.