What are Incoterms????

What are Incoterms?

Incoterms are only part of the contract for sale. However, they are an integral part of the international transaction. Incoterms deal with the questions related to the delivery of the products from the seller to the buyer. This includes the carriage of products, export and import clearance responsibilities, who pays for what, and who has risk for the condition of the products at different locations within the transport process. Incoterms are always used with a geographical location and do not deal with transfer of title. In determining what incoterm is appropriate to structure a transaction, here are some issues to think about. What is included in the seller's price (where is the buyer taking responsibility for the shipment)? How much control does the seller need in the transaction? For instance, does the seller need to present documents to a bank in a draft or letter of credit transaction? Does the seller regularly ship and receive any large freight discounts that can be passed along to the buyer, or is the product sensitive or fragile so the seller wants to contract for carriage and control part of the transport? Does the buyer have facilities in the U.S. to take possession of the goods? How much knowledge does the buyer have in international trade? Does the product need an export license? What is the importing country, are there any specific currency or payment control? What is the method of payment (open account, letter of credit, draft, or cash in advance)? Who is insuring the products, since incoterms only address this issue in terms - CIP and CIF. In the other 11 terms, it is a negociable point. Different aspects of the international transaction Packaging the product for export. Loading the product on the first carrier - pre-carriage. Clearing the shipment for export. Arranging for international transport - main carriage. Payment for the main carriage Arranging for insurance - this is only addressed in 2 terms, and is the seller's reponsibility in these terms - CIP and CIF. Arranging for customs clearance in the buyer's country. Arranging for and paying for transport from point of arrival in buyer's country to the destination point within the buyer's country - on-carriage. Buyer & Seller: Mirror Image of Obligation Seller Must Provide products in conformity with the contract Licenses, authorizations, other formalities Contract of carriage and insurance Deliver the products to agreed location Transfer of risk for the products Division of costs Notice to buyer Proof of delivery, tranport or electronic documentation Checking, packaging, and marking the shipment Other obligations Buyer Must Pay the price of the products Licenses, authorization, and formalities Contract of carriage and insurance Take delivery of products Transfer of risk for the products Division of costs Notice to seller Proof of delivery, transport or electronic documents Inspection of products Other obligations

Your concern should not be ONLY to have IEC no.

You should have IEC No.
But along with that you should see to it that you are not violating any of the exporting countries rules and regulation....

The following are a few examples of boycott requests or conditions that
would be in violation of U.S. law if you agreed to the terms.

1) “In the case of overseas suppliers, this order is placed subject to the
suppliers not being on the Israel boycott list published by the central
Arab League.” You may see this language on a purchase order.

2) “Goods of Israeli origin not acceptable.” You may see this language on
the importer’s purchase order.

3) “We hereby certify that the beneficiaries, manufacturers, exporters, and
transferees of this credit are neither blacklisted nor have any connection
with Israel, and that the terms and conditions of this credit in no way
contravenes the law pertaining to the boycott of Israel and the decisions
issued by the Israel Boycott Office.” You may see this language on a
letter of credit.
These are just some examples of the kind of language that, if you agreed to
the terms, would get you in trouble.

Following is a real-world example :-

On May 20, 1999, the Commerce Department
imposed a $5,000 civil penalty on the SABRE Group, a Texas provider of
travel-related products and services, to settle allegations that, in a 1998 contract
with a company in Pakistan, SABRE agreed to refuse to subcontract any
work to Israeli-based businesses or individuals. Additionally, the Commerce
Department alleged that SABRE failed to report promptly its receipt of the
request to make this agreement. SABRE voluntarily disclosed the transaction
that led to the allegations and fully cooperated with the Commerce
Department’s investigation.

A good site

http://resources.alibaba.com/topic/500016026/Marketing_and_Business_Planning.htm

Types of import export

Types of Import/Export Businesses

• Export management company (EMC): An EMC handles export operations for a domestic company that wants to sell its product overseas but doesn't know how (and perhaps doesn't want to know how). The EMC does it all--hiring dealers, distributors and representatives; handling advertising, marketing and promotions; overseeing marking and packaging; arranging shipping; and sometimes arranging financing. In some cases, the EMC even takes title to the goods, in essence becoming its own distributor. EMCs usually specialize by product, foreign market or both, and--unless they've taken title--are paid by commission, salary or retainer plus commission.
• Export trading company (ETC): While an EMC has merchandise to sell and is using its energies to seek out buyers, an ETC attacks the other side of the trading coin. It identifies what foreign buyers want to spend their money on and then hunts down domestic sources willing to export. An ETC sometimes takes title to the goods and sometimes works on a commission basis.
• Import/export merchant: This international entrepreneur is a sort of free agent. He has no specific client base, and he doesn't specialize in any one industry or line of products. Instead, he purchases goods directly from a domestic or foreign manufacturer and then packs, ships and resells the goods on his own. This means, of course, that unlike the EMC, he assumes all the risks (as well as all the profits).

What is NAFTA????

The North American Free Trade Agreement or NAFTA is an agreement signed by the governments of Canada, Mexico, and the United States, creating a trilateral trade bloc in North America. The agreement came into force on January 1, 1994. It superseded the Canada-United States Free Trade Agreement between the U.S. and Canada. In terms of combined purchasing power parity GDP of its members, as of 2007^[update] the trade bloc is the largest in the world and second largest by nominal GDP comparison.