Export Procedures

1. Pakistan Customs mainly examines ‘Goods Declaration (GD)’ and ‘Packing List (PL)’ and then compares it with the physical goods packaged for export.
2. There are three types of Custom channels Red, Yellow, and Green.
   a. Goods going through the red channel are required to be thoroughly inspected and its GD and PL are to be examined in detail.
   b. Goods going through the yellow channel are not examined in physical and normally their documents are inspected for compliance.
   c. Goods going through the green channel are not inspected and their documents are considered error free.
3. 4th copy of shipping (through customs) bill to be used for rebates on bank/sales tax refund. Refunds and rebates are processed by the State Bank of Pakistan.
4. BCA (Bank Credit Advice) to be received from commercial Banks after foreign exchange is received. The BCA is considered proof for the purpose of rebates, refinance scheme etc.
5. Goods Declaration (GD) Form is a custom online declaration form to declare complete details of Goods that we want to import or export from Pakistan. In Weboc fill the declaration form online. Once declared form is filled in and your cargo is cleared from customs examination then customs allow you to load your container on the vessel. Your GD which will use be used to issue B/L (Bill of Lading). A bill of lading contains details about which goods are being shipped, where the shipment is coming from and going to, as well as details of the shipper, carrier, and consignee.
6. Packing List (PL) may be used by your freight forwarder to create the B/L for the shipment. A bank may require that a detailed packing list be included in the set of documents you present to get paid under a letter of credit. Customs officials in Pakistan and the destination country may use the packing list to identify the location of certain packed items they want to examine. The packing list identifies items in the shipment and includes the net and gross weight and dimensions of the packages. It identifies any special instructions for ensuring safe delivery of the goods.
7. Some countries require a certificate of origin for your shipments in order to identify from which country the goods have originated. The certificate of origin is issued by the Chamber of Commerce in your area. A certificate of origin may be required even if you’ve provided the country of origin details on your commercial invoice. Usually the Chamber of Commerce will charge you a fee to stamp and sign your certificate or may require you to be a member of the chamber. However, an electronic certificate of origin (eCO) is recommended to avoid delay and costs attached to by-hand submissions
8. In addition to the generic certificate of origin form, there are also country-specific certificates of origin. Pakistan currently has signed 4 Free Trade Agreements(FTAs), 3 Preferential Trade Agreements PTAs, and is eligible for 10 Generalized System of Preference GSP schemes under which Pakistani goods either face reduced or zero duty rates when imported into those countries. To be eligible for these reduced tariff rates, in most cases the importer must be able to verify that the goods they are importing qualify under their specific free trade agreement.
9. Bill of Lading can serve as both a contract of carriage and a document of title for the cargo. There are two types: Straight B/L and Clean B/L. The straight bill of lading names a specific person or company as the receiver of the goods, and only that named person or company can claim the goods. It cannot be transferred to someone else. A clean bill of lading is a type of shipping document that confirms the goods were received by the shipping company in good condition and without any visible damage or defects.
10. Once the consignment, to be exported arrives at the port, usually a clearing agent services are sought. The following documents are required to provide to clearing agent to clear the consignment: Packing List, Commercial Invoice, Goods Declaration, Letter of Credit (L/C), Certificate of Origin.
11. After all the above matters have been cleared depending on the terms of delivery, you may hire a freight forwarding agent to deal with matter related to transport. A transporter may be hired to arrange and transport goods to the port (from upcountry if applicable) and the procurement of the container (either by the buyer or seller) for loading the goods. At port, container is registered and a serial number is allotted to it. After registration, examination of documents (weight/value/ quarantine/grading/invoice etc) are conducted by examination officer, appraiser officer (A.O) and principal appraiser. Principle officer after his satisfaction allows shipment. The bill of lading is stamped and handed over to the freight forwarding agent to be forwarded to the buyer for release of payment.
12. If products are considered dangerous goods by either the International Air Transport Association (IATA) or the International Maritime Organization (IMO), exporter needs to include the appropriate dangerous goods forms with the shipment. These forms need to be completed by someone who has been trained to handle dangerous good shipping.
13. A bank draft is an important part of getting paid for the exports under a documentary collection. The seller attaches the various required documents to the bank draft and presents it to the bank to get paid. Usually the seller’s bank will send the bank draft and related documents via the freight forwarder to the buyer’s bank. When the buyer authorizes payment for the goods, the bank releases the documents to the buyer and transfers the funds to the seller’s bank.

Payment Procedure

1. After completion of export customs clearance procedures and collection of air waybill (AWB) or Bill of Lading, necessary documents for bank and overseas buyer are prepared to receive the payments.
2. The export bill can be discounted, arrange for collection of payment on credit basis or can be negotiated if shipment is exported on the basis of Letter of Credit.
3. If you have availed packing credit from bank, the amount of discounted/ negotiated export bill amount will be adjusted once bank receives export proceeds from your overseas buyer.
4. If bank does not receive such export proceeds from your overseas buyer, your bank may crystalize such export bills.
5. Exporter/bank can approach credit insurance company for claim, if such cover is ensured by the exporter/ the bank.
6. Letters of Credit (LC) are one of the most secure instruments available to international traders. An LC is a commitment by a bank on behalf of the buyer that payment will be made to the exporter, provided that once the terms and conditions stated in the LC have been met, as verified through the presentation of all required documents.
7. Confirmed (LC): The opening bank confirms payment even if there are exchange difficulties.
8. Unconfirmed LC: Payment is not guaranteed but it is cheaper.
9. Irrevocable Letter of Credit: Cannot be revoked within the period, of its validity.
10. A documentary collection (D/C) is a transaction whereby the exporter entrusts the collection of the payment for a sale to its bank (remitting bank), which sends the documents needed by the buyer to the importer’s bank (collecting bank), with instructions to release the documents to the buyer for payment.
11. Funds are received from the importer and remitted to the exporter through the banks involved in the collection in exchange for those documents.
12. D/Cs involve using a draft that requires the importer to pay the face amount either at sight (document against payment) or on a specified date (document against acceptance).
13. The collection letter gives instructions that specify the documents required for the transfer of title to the goods.
14. Although banks do act as facilitators for their clients, D/Cs offer no verification process and limited recourse in the event of non-payment. D/Cs are generally less expensive than LCs.
15. An open account transaction is a sale where the goods are shipped and delivered before payment is due, which in international sales is typically in 30, 60 or 90 days.
16. Obviously, this is one of the most advantageous options to the importer in terms of cash flow and cost, but it is consequently one of the highest risk options for an exporter. Because of intense competition in export markets, foreign buyers often press exporters for open account terms since the extension of credit by the seller to the buyer is more common abroad. Therefore, exporters who are reluctant to extend credit may lose a sale to their competitors.
17. Exporters can offer competitive open account terms while substantially mitigating the risk of non-payment by using one or more of the appropriate trade finance techniques. When offering open account terms, the exporter can also seek extra protection using export credit insurance.
18. Consignment in international trade is a variation of open account in which payment is sent to the exporter only after the goods have been sold by the foreign distributor to the end customer.
19. An international consignment transaction is based on a contractual arrangement in which the foreign distributor receives, manages, and sells the goods for the exporter who retains title to the goods until they are sold.
20. Sometime a regular buyer does not like to waste time in opening LCs again and again. The buyer orders his bank to arrange credit in favor of exporter which should remain in force but at no time to exceed certain limit. The amount reverts to the original amount after each shipment and negotiation of the documentary bill.



Foreign Exchange Regulations



1. Obtaining Form-E for every shipment from Commercial Bank is essential to meeting the Foreign Exchange Regulations of Pakistan. Form-E is issued by commercial banks to the exporters on request.
2. All exports from Pakistan which are subject to Foreign Exchange Regulations are required to be declared on form “E” which is in sets of four copies each.
3. The exporter must submit the full set of Form “E” to the bank after it has been completed and signed by the exporter himself or his authorized agent.
4. While certifying Form “E”, bank should ensure that exporters give only one address in Form “E”.
5. After the form is certified by the bank, it should be submitted to the Customs authorities at the time of shipment along with the shipping bill. The Customs authorities will detach the original copy and after filling in the portion relating to them and affixing their seal and signature thereon will forward it to the State Bank. The Customs authorities will return the duplicate, triplicate and quadruplicate copies to the exporter or his authorized agent who will retain the quadruplicate for his own record and submit the duplicate and triplicate copies to the authorized dealer along with the shipping documents within 14 days from the date of shipment.
6. All shipping documents covering goods exported from Pakistan and declared on form “E” must be passed through the medium of bank within 14 days from the date of shipment.
7. The exporter must submit the duplicate (bearing Customs seal and signature of Customs Officials with Code number) and triplicate copies of form “E” along with the shipping documents, invoices etc., to the bank who had certified the form “E‟. An extra copy of the shipper’s invoice must be attached to the triplicate copy of the form “E”.

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