Import-Export Business Basic Terms Introduction

In today’s rapidly evolving global market, understanding the fundamentals of Import-Export business is crucial for Bangladeshi entrepreneurs and professionals. Whether you are just starting or looking to enhance your knowledge, having a firm grasp of the essential terms and processes can significantly improve your business efficiency and compliance. This newsletter is designed to provide you with a comprehensive guide to the key terms you need to know for successful Import and Export operations in Bangladesh.

Key Terms and Their Meanings

?FOB (Free on Board): The value of the product until it is loaded onto the ship in the exporting country, i.e., the Cost value of the product.

?C&F (Cost & Freight): Product production cost plus transportation cost. If actual freight is unknown, consider at least 20% of the cost as freight.

?CIF (Cost Insurance Freight): Production cost + Insurance cost + Transportation cost. Adding a 1% landing charge to this amount determines the Assessable Value for customs used for taxation.

?AV (Assessable Value): The value used to determine customs duty.

?L/C (Letter of Credit): A bank-issued guarantee for receiving or sending foreign funds for product import/export.

?LCA (Letter of Credit Authorization): The form for opening an L/C. The LCA date can never be after the L/C date but can be the same.

?Masters L/C: The L/C under which raw materials and products are imported/exported for 100% export-oriented industries.

?B.B. L/C (Back-to-Back L/C): Issued to suppliers of accessories under the Masters L/C for the main product's production.

?L.B (Lien Bank): The bank through which all imports and exports of 100% export-oriented garment industries are conducted.

?B/L (Bill of Lading): Shipping document issued by the shipping agent after goods are loaded onto the ship.

?AWB (Air Way Bill): Shipping document issued by the airline or its agent after goods are loaded onto the plane.

?P.I (Proforma Invoice): The initial invoice indicating the price of the goods issued by the exporter.

?PSI (Pre-Shipment Inspection): Inspection conducted by the shipping company.

?CRF (Clean Reports of Finding): Certificate issued by PSI organizations detailing quality, price, HS CODE, and commercial description of the goods.

?NNRF (Non-Negotiable Reports of Finding): Issued if the CRF is not compliant.

?CPC (Customs Procedure Code): Code indicating the calculation of duty lines for goods.

?ASYCUDA (Automated Systems for Customs Data): Software for storing and calculating customs-related information.

?LCL (Least Cargo Load): Loading goods from multiple importers into a single container.

?FCL (Full Cargo Load): Loading goods from a single importer into a single container.

?SOC (Shippers Owners Containers): When the importer owns the container. During assessment, customs duty is collected, and goods are cleared in favor of the importer.

?SRO (Statutory Regulatory Orders): Government Notifications.

?HSCODE (Harmonized Commodity Description and Coding System): A global coding system used for identifying all goods.

?? Heading: The first four digits of the HS Code.

?? CHAPTER: The first two digits of the HS Code.

?? Sub Heading: The first six digits of the HS Co

?Mongle: Twenty Equivalent Units (TEUs). A standard container is considered 20 feet long; a 40-foot container is counted as 2 TEUs.

?ITC (Import Trade Control): The Import Trade Regulator.

?IP (Import Permit): A permit letter usually issued by the Ministry of Commerce under CCI&E if goods are imported without opening an L/C.

Conclusion

Mastering these essential terms will empower you to effectively handle Import-Export activities in Bangladesh. Staying updated and informed ensures smoother transactions, better compliance, and ultimately, greater business success. Keep this guide at your disposal as a helpful resource to enhance your international trade operations.