The commercial invoice (CI) is the record of a sales transaction and a crucial part of any import/export shipment. In a transaction, these documents record the buyer and seller’s information, detailed descriptions and quantities, trade terms, price, reference marks regarding the packaging and contents, payment arrangements, and the signature of the exporter that are agreed upon by both parties as a verifiable contractual obligation. The commercial invoice also acts as a guide for customs clearance and insurance purposes in case of questions during the import process. Even in shipments for loan, testing and sampling are required to have a CI with pricing to clarify the cost of the goods and terms of the transaction.
Customs invoices are the primary source of information that Customs will use to determine the classification, value and duty owed on import shipments. It’s paramount that the details of the invoice are in compliance with Customs’ requirements so cargo can be expedited through the clearance process. While most forwarders will accept a pro-forma or shipper’s invoice to begin arranging transportation these documents don’t represent the contract of sale between parties and it’s important that the actual CI is available once the shipment departs as terms are no longer negotiable and final details must be exact. Using anything but a commercial invoice can cause customs delays and, even in cases of “no commercial value,” duties can be ascribed based on the merit of the goods as determined by customs.
The commercial invoice also provides a record of value for the shipment for insurance purposes. While cargo can be insured for less than the invoice price, this document will provide a record to insurance as to the exact quantity and cost of the shipment if the cargo is damaged or lost during transit. CI’s also help determine which entity is in legal possession of the cargo at the point it was lost or damaged, based on the trade terms (INCO Terms 2010) listed on the document.
If you have questions about the information in your commercial invoices, or those you received for an import shipment, we at Everglory Logistics are available to advise on the specifics of your invoice based on the destination requirements. We understand the complicated nature of exporting cargo and can help you prepare to deliver complete information to expedite the clearance and avoid costly delays and fines.