Q1. We have heard that there are some new Incoterms called DAT and DAP, is this correct ?

A1: Incoterms 2010 is the current Incoterms, having been implemented on 01 Jan 2011. In the new rules 4 previous Incoterms are deleted (DAF DES DEQ DDU) and 2 new Incoterms have been introduced : DAT (Delivered at Terminal) and DAP (Delivered at Place).  See our Incoterms page on this website for further information.  Chadwick Export Services Ltd are running training courses on these new rules, see our Training page for further details.

Q2: Our recently received Letter of Credit for export of goods to India does not quote a Latest Shipment Date, is this a mistake ?

A2:    Not necessarily. If there is no mention on the L/c of a timeframe for Export, then you technically have up to the Expiry Date to despatch your goods. In reality, though, you would have to allow yourselves time to gather your documents for presentation to the bank. We would therefore suggest you backtrack 21 days from the L/c Expiry Date, and treat this as your ‘latest shipment date’.  See our Letters of Credit page on this website for more information.

 Q3.   Our Board of Directors are considering applying for AEO, what does this mean ?

A3:  The introduction of AEO (Authorised Economic Operator) status is the ECs response to the need to secure International Supply Chains and the introduction of C-TPAT (Customs-Trade Partnership Against Terrorism) in the USA, and the development of the Safe framework of standards in the WCO (World Customs Organisation). An AEO is considered to be reliable in their customs related operations throughout the European Community and is therefore entitled to certain benefits, all of which are detailed in Public Notice 117 (available to download from HMRC website, see our Useful Links page on this website). You may also download the Application Pack and Explanatory Notes C117 and C118. In addition a secure interactive web based application pack is available from the BusinessLink website, see our Useful Links page on this website. . You do not have to apply for AEO Status, but HMRC expect that once the AEO system has bedded in, they will start to focus controls on supply chains that do not include AEOs and are deemed to be less secure.  Chadwick Export Services Ltd provide training courses on AEO and the Modernised Customs Code, see our Training page for further details.

Q4: Can you please advise the 2 figure country code for each of the EC Member States, so we know the 2 letters that their VAT (Tax) number should be prefixed with  ?

A4: Yes, you may click here for further information, and we would also recommend that you visit the HMRC website (see our Useful Links page on this website)

Q5 We recently presented an Insurance Certificate to the UK bank against a Letter of Credit, but this was rejected as discrepant due to the Insurance Value being the same as the Invoice Value, where did we go wrong ?

A5. The minimum Insured Value should be 10% more than your Total CIF/CIP Invoice value. This is an obligation of Incoterms, and banks will reject cover for less or more than CIF/CIP+10%, unless the L/c specifically states otherwise.  See our Incoterms page on this website for further information. 

Q6.   We are importing a consignment from China into Netherlands and wondering how we go about paying the duties & taxes ?

A6:  You have a choice, which is dependent on the goods and the reason for your import. You may either Import customs clear into Netherlands, paying the appropriate EC duty and Netherlands tax. However, you could only claim back the tax paid by you in Netherlands if you were tax registered there. The goods would then be T2 status and be in free circulation, and if you moved these from Netherlands to UK you would need to report on Intrastat, if your EC trade is of the appropriate threshold. Alternatively, it may be appropriate for you to retain the goods as T1 status, but if you then moved T1 status goods from Netherlands to UK you would require a Transit SAD/C88 as the duties and tax are not yet paid. To ensure you are fully aware of the rules and your obligations, you can obtain further information on HMRC website(see our Useful Links page on this website)   Chadwick Export Services Ltd provide training courses on Import and related issues, see our Training page for further details.

Q7: Can you please advise the 2 figure country codes for the rest of the world ?

A7 : Yes, you may click here for further information, and we would also recommend that you visit the HMRC website.  (see our Useful Links page on this website)

Q8: Our Letter of Credit for Nigeria requires us to present a Certificate stating that we have sent by courier One of the Three Original Bills of Lading direct to the Issuing Bank in Nigeria, presenting the remaining Two Originals to the Confirming bank here in UK. Whilst we are happy to do this, we are worried that if the UK bank find any problems with the detail on the Bills of Lading, we cannot then have these amended/re-issued by the Shipping Line. Can you offer any advice ?

A8: We recognise this situation, which is common with Nigerian Letters of Credit. We would suggest that you voice your concerns to the UK Confirming Bank, and ask them to consider doing a pre-check on your documents. This would require you to obtain a draft Bill of Lading from the Shipping Line, ideally in advance of vessel sailing if possible, and submitting this to the bank for prior approval. Be prepared for the bank charging for this service. This should give you some reassurance, but do take great care to thoroughly check the documents yourself prior to submission. Aim to present documents as quickly as possible, to ensure you have enough time before expiry of your presentation period.  See our Letters of Credit page on this website for more information.

Q9. I've just joined a Company and notice that their IPR Authorisation permits Equivalence, can you please explain what this is ?

A9: Yes, this would have been a request that your Company placed on their Application for IPR Suspension, for which they have been granted approval. Prior Export Equivalence is when you are approved to use free circulation goods that are equivalent to the goods on your Authorisation. However, you must ensure that you meet all the required criteria quoted on your Authorisation. For example, you may have a customer (outside the EC) whose Assembly Line is halted due to a broken motor. Instead of the customer having to await for the repair and return of the repaired motor, you may be approved to use Prior Export Equivalence. This would permit you to export an equivalent free circulation motor (i.e. from your stock), prior to the import of the broken motor. The broken motor would still have to be imported for repair, in the precise way approved on your Authorisation, but would then be placed into your stock. Thus enabling your customer's Assembly Line to be up and running within a shorter time frame.  Please bear in mind that all the Processing Regimes shall be changing due to the Modernised Customs Code 2013.  Chadwick Export Services Ltd provide training courses on Import and related issues, see our Training page for further details. 

Q10     We have heard mutterings about having to provide HMRC with guarantees / bonds for IPR (Inward Processing Relief) Imports, is this correct?

A10.     The detail of the MCC (Modernised Customs Code) is still being finalised, and is likely to be introduced by 2013. It is possible that Companies that do not have AEO status will be required to place a guarantee / bond with HMRC for certain imports being placed into Processing Regimes, such as IPR Suspension. Please note that the plan includes IPR Drawback being withdrawn.  Chadwick Export Services Ltd provide training courses on AEO and the Modernised Customs Code, see our Training page for further details.

 Do you have a question on Export / Import related matters that you would like us to assist you with ? 

Then please get in touch by using the "Contact Us" section of our website, ensuring that you provide your full contact details (Name, Company, Tel, Email) to ensure reply.

Of course, you may also contact our Helpline, see the "Helpline" section of our website for further details.

We look forward to hearing from you !