Shipping Documents For Export – Your Path Through the Paperwork

In the post-pandemic world, international trade is once again bustling and, despite a variety of operational challenges (COVID recovery and Brexit among them), it’s safe to say: UK exporters are keeping busy.

From July 2022 – July 2023, UK-based businesses exported £848.6 billion worth of goods, services, and technology; an impressive 16.2% increase on the previous year’s trade (Department for Business and Trade).

However, beneath these impressive figures lies a complex web of logistics, regulations, and – perhaps most notably – paperwork. Exporting goods requires a multitude of shipping documents, each serving a unique purpose.

Often cumbersome and rarely simple, shipping documentation is a necessary part of the process, ensuring goods are correctly classified, compliant with international regulations, and safely transported to their destinations. From invoices to certificates, bills of lading to certificates of origin, the variety of documents can be daunting.

So, how can businesses navigate this labyrinth of export documentation efficiently?

In this blog post, we’ll guide you through the essential shipping documents for export, offering valuable insights to streamline your operations and ensure compliance. Let’s get started.

Why You Need Shipping Documents In Order to Export

Complex and confusing though they may be, shipping documents can be seen as part of the lifeblood of international trade. Their importance is multifaceted, depending on the specific use case – often, a primary role is to ensure compliance with various rules and regulations governing international commerce.

Let’s take an example. Consider the plight of a UK electronics company, attempting to export a shipment of advanced circuit boards, without the requisite documentation:

• Customs authorities, without the necessary paperwork, may halt the shipment, leading to frustrating and costly delays in international transit.
• Storage fees may accrue during this time, escalating expenses.
• Moreover, non-compliance could result in substantial fines.
• Perhaps most damaging of all, the company’s reputation could suffer irreparable harm, impacting relationships with partners and customers alike.

Beyond ensuring compliance, shipping documents for export offer invaluable details about the cargo, such as its nature, quantity, and value. These specifics are vital for a number of reasons, including facilitating customs clearance, determining applicable import duties and taxes, and assessing potential risks.

So, what are some of the most important shipping documents for export, and what are their respective functions?

The Essential Shipping Documents List

Consider the following as a checklist for international shipping. Not all apply for all goods but list provides examples of common documents. They exist to help ensure goods reach their intended destination efficiently and in compliance with the vast array of international regulations.

Commercial Invoice

This comprehensive document provides a meticulous breakdown of the goods’ value, description, and the agreed-upon terms of sale. According to the USA’s International Trade Administration, a commercial invoice is “a required document for the export and import clearance process. It is sometimes used for foreign exchange purposes. In the buyer’s country, it is the document that is used by their customs officials to assess import duties and taxes.”

Bill of Lading

A bill of lading (or BL / BoL) serves both as a receipt of goods by the carrier, and as a contract between the shipper and the carrier. It outlines key details of the shipment, including the nature and quantity of the cargo.

For air freight, an airway bill (AWB) serves a similar purpose. The document outlines vital information about the cargo being transported by air.

Certificate of Origin

A certificate of origin confirms the country where the goods were manufactured or produced. It significantly influences applicable tariffs and trade agreements, making it critical for accurate customs assessments. You can get further guidance on obtaining proof of origin from gov.uk.

Packing List

This essential document specifies the contents of each package within the shipment. A packing list can be invaluable during customs inspections, ensuring that goods are correctly declared and delivered efficiently.

Letter of Credit

A crucial financial document, a letter of credit provides a payment guarantee issued by a bank. It ensures that the seller receives payment once the agreed-upon conditions are met, safeguarding against payment-related issues.

Export Licence

In cases involving controlled items or specific destinations, an export licence is mandatory. It is a fundamental component of ensuring adherence to complex export regulations. Some items, such as chemicals, historical artefacts, and dual-use items, are clear candidates to appear on UK exports controlled goods lists; others that you might not initially consider include video game consoles, or crayons (due to the presence of paraffin wax).

Shipper’s Export Declaration (SED)

Required specifically by the U.S. Department of Commerce for shipments originating in the USA, a Shipper’s Export Declaration (SED) document is submitted to the U.S. government and serves the purpose of both compiling export statistics, and ensuring regulatory compliance.

Insurance Certificate

As a protective measure, this certificate offers coverage against potential damage or loss that might occur during shipment. It is a safeguard that minimises financial risks.

Proforma Invoice

A proforma invoice is sent to the buyer before the actual shipment occurs. It is often used for customs clearance and import approval processes. In the words of the UK government:

“The primary function of an invoice is to provide formal confirmation of a specified supply of goods or services. Proforma invoices may be broadly defined as commercial documents that contain some or all of the information normally contained on an invoice, but which do not fulfil that primary function.”

Certificate of Inspection

This certificate verifies that the goods meet specific quality or safety standards. It is especially crucial for certain types of products that require certification before importation.

Bill of Entry

Processed in the UK by the National Clearance Hub (NCH), this document is a legal requirement in many countries and serves a similar function to a customs declaration – providing details about the goods, their value, and origin.

Incoterms

While not a standalone document, Incoterms (International Commercial Terms) are crucial for defining the responsibilities of buyers and sellers in international trade contracts. They establish essential terms like delivery, risk, and cost allocation.

Phytosanitary Certificate

Phytosanitary checks are essential for the export of plants, plant products, or other regulated items, confirming compliance with the phytosanitary requirements of the destination country.

Certificate of Free Sale

Often needed for exporting certain foods, drinks, and agricultural products, a certificate of free sale attests that the products are freely sold in the country of origin and meet its safety and quality standards.

Some Things to Remember

There’s a lot to process here, and we understand it can be a lot to keep across.

If you’d like to obtain independent, honest, and professional guidance in streamlining your export operations, consider the following trade consultancy services offered by clearBorder:

• Export Control Compliance Services – to ensure your export operations proceed smoothly, and your reputation is safeguarded.

• Expert SPS Control Compliance – to help demystify international trade in food, plants, and animal products.
• Ireland – UK Trade – to help your organisation navigate the complexities of trade between Ireland and the United Kingdom.

Alternatively, if you’re looking to upskill your current team and boost your in-house knowledge, the following training courses might be what you’re looking for.

Above all, remember: sound documentation practices are not just about expediting shipments; they are also about risk mitigation and cost-efficiency in the world of global trade.

A Few Best Practices

To navigate the world of shipping documents effectively – in addition to the above – consider these best practices:

1. Document Checklist: Create a comprehensive checklist of required shipping documents for each export, ensuring nothing is overlooked.
2. Digital Recordkeeping: Embrace digital recordkeeping to help organise and store shipping documents securely, simplifying retrieval and audit processes.
3. Stay Informed: Be proactive, and aim to keep abreast of changing customs regulations and export documentation requirements.
4. Double-Check Details: Before submission, meticulously review all shipping documents for accuracy and completeness.
5. Backup Copies: Always keep backup copies of important documents, as they can be required for various purposes, including audits.

Export With Confidence

Ultimately, though it’s easy to feel overwhelmed by all the paperwork, legislation, and regulations, as an exporter you can work to streamline operations by adhering to a few key strategies and tapping into the advantages offered by trade agreements.

Precise management of export documentation is paramount in ensuring error-free international shipping. Staying well-informed about the latest regulations and practices in international trade is important, and you might also consider collaborating with expert freight forwarders who specialise in international shipping processes.

Moreover, leveraging free trade agreements can be a strategic move. These agreements, like the UK’s free trade agreements with various nations, simplify customs procedures, cut tariffs, and enhance the efficiency of cross-border transactions.

For more information on ways to optimise your operations and personalised advice, don’t hesitate to contact us today.