Letter of Credit Basics: Definition and Types

Letter of credit is a payment method used in international trade transactions.

The letter of credit is distinguished itself from other payment methods in international trade by its complex structure and detailed rules.

Due to this complex structure, many international trade personnel have facing difficulties in letter of credit transactions.

Starting with today's post, I will be writing articles regarding different aspects of letters of credit. Hoping that my posts will be helping you out in your daily work.

The first article not only explains letter of credit definition but also defines letters of credit types.

What is Import Customs Clearance?

When it comes to customs clearance, many people think of customs operations occur only at the importing stage.

But this widespread belief does not reflect the reality, because at least two different customs clearance have to be done in a single foreign trade transaction.

First customs clearance takes place at the exporting stage, which is called export customs clearance and second customs clearance takes place during the importing stage, which is also known as import customs clearance.

On my previous article, I have explained export customs clearance.

Today I want to make clarifications regarding import customs clearance operations.

What is Export Customs Clearance?

Each independent state has its own customs territory.

Every product, entering or leaving the customs territory of a specific country has to be subjected to customs procedures in accordance with the customs legislation of that country.

These procedures are also known as customs clearance.

If the customs clearance is carried out at the export stage, it is called export customs clearance.

Just on the other hand, if the customs clearance is carried out at the import stage, it is called import customs clearance.

Definition: Export customs clearance defines all the procedures and formalities that must be followed in order to export a particular good from an exporting country including but not limited to obtaining any export licence or other official authorization and carry out all customs formalities necessary for the export of the goods.

How to Complete a Bill of Lading and a Shipping Instructions? Step by Step Explanation with Examples

Bill of lading is a generic name of a transport document, which is used when goods are carried out via sea shipments.

Today's complex economic activities and modern transportation industry created a ground for the development of different types of bills of lading to be used in different situations.

Forwarder's bill of lading, charter party bill of lading, multimodal bill of lading, negotiable bill of lading, sea waybill etc. are some of the most frequently issued bills of lading types.

Regardless of what types of bill of lading you may face, you can be benefited from today's article, as I will try to explain how to complete a bill of lading in a very plain text with examples.

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Easy way to understand the differences between port-to-port, port-to-door, door-to-port and door-to-door shipments

Today, I would like to explain some of the basic shipping terms, that define the starting and ending points of the transportation, known as port-to-port, port-to-door, door-to-port and door-to-door shipments, which you may encounter on your daily work routine very frequently as a shipper or consignee.

Let me start my explanations with port to port shipments.

Port to Port Shipment

“Port to Port Shipment” defines a type of shipment, which commences at the Port of Loading and ends at the Port of Discharge.

Port to Port shipment or Port to Port delivery is the basic form of sea freight transportation, which is used by carriers for hundreds of years.

Bill of lading is the generic name of the transport document, commonly used in Port to Port shipments. It is also known as port to port bill of lading, marine bill of lading or ocean bill of lading.

Thanks to the technological improvements in logistics sector and standardization achieved by containerization, now carriers, actual or contractual, can offer more flexible transport options to their clients.