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47 Cards in this Set
- Front
- Back
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4 departments of International Trade Administration (ITA) |
Market Access and Compliance(MAC): seek to open foreign markets to American products by making strategies to overcome obstacles faced by U.S. businesses in foreign countries Manufacturing and Services: promotes trade interests of American industries by helping to shape industry-specific trade policy U.S. and Foreign Commercial Service (USCS): provide background information on foreign companies and assist in finding foreign representatives, conducting market research, and identifying trade investment opportunities for U.S. firms Import Administration: enforces US trade law and agreements to prevent unfairly traded imports and to safeguard competitiveness of US businesses |
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Department of Commerce trade events('show and sells') |
US pavilions: exhibitors get support from Commerce in management and overseas promotional campaigns to attract business Trade missions: focus on industry sector, participants are given marketing info, publicity, appointments with buyers and govt officials Product literature center: represent US companies at international trade shows Reverse trade missions: fund visits to US for representatives of foreign govts to meet with American industry |
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Terms of sale |
Conditions of a sale that stipulate the point at which all costs and risks are borne by the buyer (ex. freight and insurance) |
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Incoterms |
Universal trade terminology developed by the International Chamber of Commerce |
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Ex-works (named place) |
Seller makes good available at factory or warehouse to the buyer at the seller's "named place" of business. This trade term places the greatest responsibility on the buyer and minimum obligations on the seller. |
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FCA (named place) |
Free Carrier, seller hands over goods to carrier at a named place, If the named place is the seller's place of business, the seller is responsible for loading the goods onto the transport vehicle. If the named place is any other location, such as the loading dock of the carrier, the seller is not responsible for loading the goods onto the transport vehicle (The "named place" in Free Carrier and all "F" terms is domestic to the seller.) |
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CPT (named place of destination) |
Carriage Paid To destination, seller/exporter/manufacturer clears the goods for export, delivers them to the carrier, and is responsible for paying for carriage to the named port of destination, risk passes from seller to buyer when goods are handed to carrier. (The "named port of destination" in CPT and all "C" terms is domestic to the buyer, but is not necessarily the final delivery point.) |
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CIP (named place of destination) |
Carriage and Insurance Paid to destination, seller clears the goods for export, delivers them to the carrier, and is responsible for paying for carriage and insurance to the named port of destination. Risk goes from seller to buyer when goods are handed to carrier. (The "named port of destination" in CIP and all "C" terms is domestic to the buyer, but is not necessarily the final delivery point.) |
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DAT |
Delivered At Terminal, seller pays for transport and insurance to terminal and has risk until goods loaded at terminal. |
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DAP (name of destination) |
Delivered At Place, seller pays for carriage to the named place and assumes all risk until goods are unloaded. |
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DDP (destination place) |
Delievered Duty Paid, seller delivers goods to destination and covers all duties, taxes and customs
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FAS (named loading port) |
Free Alongside Ship, seller clears the goods for export and places them by the ship; risk passes at rail |
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FOB (named loading port) |
Free On Board, seller loads goods, risk passes at rail. If the named place is the seller's place of business, the seller is responsible for loading the goods onto the transport vehicle. If the named place is any other location, such as the loading dock of the carrier, the seller is not responsible for loading the goods onto the transport vehicle. |
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CFR (named destination port) |
Cost and Freight, seller pays costs of freight and insurance to bring goods to destination port. While the seller may not be legally responsible for the goods once they pass the ship's rail in the port of shipment, he may have "insurable interest" during the voyage. Prudence may dictate purchase of additional insurance coverage.. Risk passes once goods are loaded. |
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CIF (named destination port) |
Cost Insurance and Freight, same as CFR. While the seller is responsible for procuring and paying for insurance cover during the voyage to the named port of destination, the buyer may exercise prudence and purchase additional insurance coverage. Risk still passes at ship's rail. |
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Cash in advance |
When an importer must pay the exporter in cash before a shipment is made. Seller is exposed to virtually no risk as the burden of risk is placed almost completely on the buyer. |
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Open account |
Seller assumes all of the payment-related risk, and therefore such terms should be offered only to reliable customers. Substantial risk to seller because the buyer could default on payment obligation after shipment of the goods. |
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Consignment |
Goods are shipped to the buyer and payment is not made until they have been sold. All payment risk is assumed by seller. |
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Letter of credit (L/C) |
Document issued by the buyer's bank in which the bank promises to pay the seller a specified amount under specified conditions. |
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Confirmed L/C |
Confirmation made by a correspondent bank in the seller's country by which it agrees to honor the issuing bank's letter of credit. |
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Irrevocable L/C |
Letter of credit cannot be canceled. |
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Air waybill |
Issued by the carrier be presented as proof that shipment has been made. |
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Pro forma invoice |
Seller's formal quotation containing a description of the merchandise, price, delivery time, proposed method of shipment, ports of exit and entry, and terms of sale. |
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Export draft |
Unconditional order drawn by the seller that instructs the buyer to pay the draft's amount on presentation (sight draft) or at an agreed future date (time draft) and that must be paid before the buyer receives shipping documents. |
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Banker's acceptance |
Time draft with maturity of less than 270 days that has been accepted by the bank on which the draft was drawn, thus becoming the accepting bank's obligation; may be bought and sold at a discount in the financial markets. |
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Factoring |
Sale of export accounts receivable to a third party, which assumes the credit risk. You get cash quickly, and don't have to collect the debt. However, you lose some of the value of the invoice. |
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Forfaiting |
Form of trade and supply chain financing. It involves the purchase of future payment obligations on a “without recourse” basis that fall due at some date beyond the 90 to 180 days that is customary for factoring. |
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US export-import bank (ex-im bank) |
Principle government agency that aids American exporters by means of loans, guarantees, and insurance programs. |
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Ex-Im Bank: working capital guarantee |
Helps small businesses obtain working capital to cover their export sales. |
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Ex-Im Bank: export credit insurance |
Exporter may reduce financing risks by purchasing insurance to protect against the political and commercial risks of a foreign buyer's defaulting on payment. |
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Overseas Private Investment Corporation (OPIC) |
Government corporation that offers American investors in developing countries insurance against expropriation, currency inconvertibility, and damages from wars and revolutions. |
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Foreign trade zone (FTZ) |
Duty-free area designed to facilitate trade by reducing the effect of customs restrictions (Los Angeles, Hong Kong, Singapore) |
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Free trade zone (FTZ) |
Area designated by the government as outside its customs territory. |
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Customs drawbacks |
Rebates on customs duties |
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Shipper's export declaration (SED) |
US department of commerce form used to control export shipments and record export statistics. Form contains: 1. names and addresses of shipper/consignee 2. US port of exit and foreign port of unloading 3. despriction and value of goods 4. export license number and bill of lading number 5. name of the carrier transporting merchandise |
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Automated export system (AES) |
US customs electronic filing system |
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Validated export license |
Required document issued by the US government authorizing the export of a strategic commodity or a shipment to an unfriendly country. |
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General export license |
Any export license covering export commodities for which a validated license is not required; no formal application is required. |
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Export bill of lading (B/L) |
Contract of carriage between shipper and carrier: straight bill of lading is non-negotiable; endorsed "to order" bill gives the holder claim on merchandise. (FedEx) |
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3 kinds of marine insurance |
Basic named perils: perils of sea, fires, jettisons, explosions, and hurricanes. Broad named perils: theft, pilferage, nondelivery, breakage, and leakage. All risks: covers all physical loss or damage from any external cause and is more expensive than the other policies. |
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Collection documents |
Export invoices: similar to domestic invoices, contains origin of goods, export packing marks, clause stating that goods will not be transshipped to another country. Consular invoice: form purchased from the consul, prepared in language of the country, then visaed by consul. Certificate of origin: issued by local chamber of commerce and visaed by consul. Inspection certificate: required frequently by buyers of grain, foodstuffs, and live animals. |
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CE (Conformite Europeene) mark |
European "trade passport": once a product has the mark, it can travel to any other EU member country without modification. Abides by European health, safety and environment standards. |
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LASH (lighter aboard ship) |
Vessels provide direct access to ocean freight service for exporters and importers located on shallow inland waterways. |
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Advantages shipping by air |
-Total cost may decrease -Either the firm or the product may be air-dependent -The market may be perishable -Competitive position may be strengthened |
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Customhouse brokers |
Independent businesses that handle import shipments for compensation. |
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Bonded warehouse |
Area authorized by customs for storage of goods on which payment of import duties is deferred until goods are removed. |
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Harmonized Tariff Schedule of the US (HTSA or HTSUS) |
American version of the Harmonized System used world wide to classify imported goods. |
