International Payments

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Presentation transcript:

International Payments Methods and documentation

Collection of payments for exports Registration of Exporters: Import-Exporters Code (IEC No.) from Regional licensing authority Registration cum Membership Certificate (RCMC) of Export Promotion Councils/ Commodity boards eg APEDA,FIEO ( Unless exempted under Govt) Obtaining Permanent Account NO. PAN/BIN Registration with VAT/Sales Tax authorities (Essential to get exemption for exports) Registration under Central Sales Tax Act ( Use of form H and related record of exports) Registration with Excise Authorities (mfg only) Authorized Foreign Exchange Dealers Exemptions to legal requirements Personal Remittances FCNR/NRE Accounts SEZ/EOU Units….and others

Methods of Payment 1- Advance payment 2-Direct remittance 3-Open trade account 4-Documentary collection(Presentation;30,60,90 DA) 5-Letter of credit

Letter of credit 4- Types of letter of credit 1-What is a letter of credit; Contract terms? 2- Parties to letter of credit -Applicant, Beneficiary, Issuing Bank, advising Bank, negotiating Bank) 3-Uniform customs & practices -ICC (Adopted by 165 countries) 4- Types of letter of credit -Revocable or irrevocable -Payable at sight/deferred L/c -Transferable L/C -Revolving L/C -Transit L/C Refer page 951

Letter of credit (contd.) -Back to back L/C -Acceptance L/C -Anticipatory credits -Installment credits -Restricted and unrestricted - Standby L/C -Confirmed v/s unconfirmed L/C 5-Acceptance of L/C by exporter- Check List

Issuance of L/C Summary

Amendment to L/C

Utilization of L/C

L/C Detailed Check List (P-1)

L/C Detailed Check List (P-2)

Documents required to claim credits from bank 1-Draft ( Bill of exchange) 2- Invoice 3- Bill of lading/ AWB/ACN 4-Insurance policy /certificate 5- Certificate of origin 6- Packing list 7-Other documents as specified in L/C (CTD) 8-Discrepencies and consequences

X EXPORT CREDIT & GAURANTEE CORPORATION 1- What is ECGC 2-Risks covered by ECGC -Insolvency of buyer -Failure of payment –specific conditions -Political risks 3- Risks not covered by ECGC -Commercial disputes, product defects, Exchange fluctuations, failure to get import permissions -Loss of goods covered by marine insurance -Exporter’s failure to comply with contract terms Refer page-435

Reading References Nabhi’s Export Manual and documentation- Chapters 6,39 and 40