FAQ - Exports
Indicates that payment of a
negotiable instrument is due upon presentation or demand.
BILL OF EXCHANGE
Also called a draft. An unconditional order from the
drawer to the drawee, directing him to pay a specified
amount to a named payee at a fixed or determinable future
BILL OF LADING
Service as a document of title, a contract of carriage,
and a receipt of goods. Usually prepared by the shipper
on forms issued by the carrier, indicating that goods are
to be transported from one point to another.
COST AND FREIGHT (C&F)
C&F means "Cost and Freight". The seller must pay the
costs and freight necessary to bring the goods to the
named destination, but the risk of loss of or damage to
the goods, as well as of any cost increases, is
transferred from the seller to the buyer when the goods
pass the ship's rail in the port of shipment.
COST, INSURANCE AND FREIGHT (CIF)
CIF means "Cost, Insurance and Freight". This term is
basically the same as C&F but with the addition that the
seller has to procure insurance against the risk of loss
of or damage to the goods during the carriage. The seller
contract with the insurer and pays the insurance
CONFIRMED LETTER OF CREDIT
A letter of credit which has been confirmed by a
second bank Such confirmation is desirable, since the
seller may not be familiar with the foreign bank which
issued the L/C.
A physical transfer of goods from an exporter (consignor)
to an importer (consignee) for the importer to sell. The
consignor retains title of the goods until the consignee
has sold the goods. The consignee sells the goods for
commission and remits the net proceeds to the consignor.
Documents against acceptance; instructions given by a
shipper to his bank that the documents attached to
a draft for collection are deliverable to the drawee only
against his acceptance of the draft.
Documents against payment; instructions given by a shipper
to his bank that the documents attached to a draft
for collection are deliverable to the drawee only against
his payment of the draft.
E. & 0. E.
Errors and Omissions Excepted; a phrase accompanying the
shipper's signature on an invoice, by which he
disclaims final responsibility for typographical
errors or unintentional omissions.
F. I. 0.
Free In and Out. Refers to loading and unloading costs as
they apply to the vessel. The owner of the goods is
responsible for the costs of loading and discharge.
Free Out. Under this term the owner of goods is
responsible for discharging costs.
The title of a standard clause found in marine contracts
exempting the parties for non-fulfilment of their
obligations by reason of occurrence beyond their control,
such as earthquakes, floods, or war.
FREE ON BOARD (FOB)
FOB means "Free on Board". The goods are placed on board
a ship by the seller at a port of shipment named in the
sales contract. The risk of loss of or damage to the
goods is transferred from the seller to the buyer when the
goods pass the ship's rail.
Letter of Credit. A document issued by a
bank at the buyer's request in favour of the
seller, promising to pay the agreed amount of money upon
receipt by the bank of stipulated documents within
a specified time.