Chapter 9: Performance of Import
and Export Contract
Abstract: this chapter mainly talks about the
main steps in the general process in performance
of the contract and its related issues that should be
pay close attention to.。
Section 1: Performance of Export Contract
Section 2: Performance of Import Contract
Section 3: Main documents of import and export
Section 1: Performance of Export
Contract
1. Preparation of the goods, applying for
inspection
2. Urging establishment of L/C, examine the
L/C, amending the L/C
(1) Urging establishment of L/C
(2) Examine the L/C
(3) Amendment to the L/C
Both applicant and beneficiary can ask for
amendment to an L/C. If the beneficiary asks for
amendment, the usual procedure is that the buyer
should first obtain consent form the beneficiary and
then instruct the opening bank to amend the L/C.
Beneficiary----applicant----issuing bank----advising
bank----beneficiary
Cautions to the amendment of L/C
3．Shipment, Making Declaration to the Customs,
Taking out Insurance
(1) Steps of shipment
1, check the date of shipment, fill in the booking note of the export
goods (B/N)
2. Shipping company or shipping agency issues the shipping order
3. After shipment, the master or mate issues the mate’s receipt
4. Shipper exchanges the mate’s receipt for the bill of lading from
the Ocean Shipping Agency.
(2) Declaration to the Customs
There are three kinds of companies making declaration to the
customs:
(3) Taking out Insurance
4. Making out documents for settlement under
L/C
(1) Three means to make settlement under L/C
1. Make Settlement after the Payment Is Made
2. Make Time Settlement
3. Make Settlement through Negotiation
(2) Several methods to deal with discrepancy
Section 2: Performance of Import
Contract
The main steps in the general process in performance
of the import contract are (under FOB terms,
payment by L/C) as follows:
 Open L/C
 Conclusion of the transport contract
 Cover insurance
 Examination of documents and payment for the
purchase price
 Customs entry
 Taking delivery and allocation
Section 3: Main documents of import
and export
1. Main operating documents of import and
export
 (1) Inspection certificate
 (2) Customs declaration
 (3) Insurance policy
 (4) Shipping order
 (5) Mate’s receipt
 (6)
 (7) Tax-refund form of export goods
2. Main documents of import and export for
settlement
 (1) Bill of exchange (B/E)
 (2) Invoice
1. Commercial Invoice
Note: The column of “To__” in a commercial invoice
refers to “consignee”.
2. Customs Invoice
The customs invoice is one of the documents required by
the customs which has a unified form.
3. Consular Invoice
4. Manufactures’ Invoice
5. Proforma Invoice
The proforma invoice is an invoice sent for form’s sake. It
serves as a price reference and enables the buyer to make the
necessary preliminary arrangements, such as obtaining an
import license.
(3) Bill of Lading
(4) Insurance Policy
(5) Certificate of Origin
(6) Generalized System of Preferences
Documents
(7) Packing List, Measurement List and
Weight Memo
(8) Inspection Certificate
3. Basic principles of making and examming
documents.
Accuracy, complete, prompt, concise, neat
The order of issuing documents is as follows:
Commercial Invoice, Packing List; Certificate
of Origin; Inspection Certificate; Insurance
Policy; Bill of lading; Draft
Summary
This chapter mainly talks about the main steps
in the general process in performance of the
contract and its related issues that should be
pay close attention to.
Key point: Import and export documents
Difficult point: document for settlement under
the L/C
Questions:
 What kind of work do both parties need to do
to fulfill the import and export contract?
 What are the precautions of amending L/C?
 What kind of the methods do we have to deal
with the discrepancy?
 What’s the method of making document for
settlement?