Commercial Letter of Credit : Commercial Letter of Credit
A legal theory that implies a condition or term into a contract, if no express provision was made, to excuse the parties when performance becomes impossible because an event occurs that the contracting parties could not have reasonably foreseen or controlled. Commercial frustration may arise, for example, if a seller’s shipment is lost in a shipwreck or if a manufacturer cannot obtain raw materi¬als because war has broken out in the country supplying them - force majeure
A legal theory that implies a condition or term into a contract, if no express provision was made, to excuse ei¬ther party when performance becomes impossible in prac¬tice because of the occurrence of a contingency, the nonoccurrence of which was a basic assumption for mak¬ing the contract. A manufactur er, for example, who con¬tracts to sell goods at a specific price in reliance on a subcontractor’s bid to provide certain components at a low price may claim commercial impracticability if the sub¬contractor defaults and the manufacturer can only procure comparable components at a much higher price.
Commercial Information Management System
CIMS is a trade-related application using National Trade Data Bank CD-ROMs to disseminate market re¬search and international economic data to U.S. & Foreign Commercial Service (US&FCS) domestic offices and overseas posts. The system includes data on U.S. and for¬eign traders and supports local collection and update of in¬formation on business contacts - Not available to the public
A document identifying the seller and buyer of goods or services, identifying numbers such as invoice number, date, shipping date, mode of transport, delivery and payment terms and a complete listing and description of the goods or services being sold including prices, dis¬counts and quantities
A commercial invoice is often used by govern¬ments to determine the true (transaction) value of goods for the assessment of customs duties and also to prepare consular documentation. Governments using the commer¬cial invoice to control imports often specify its form, con¬tent, number of copies, language to be used and other characteristics.
- U.S. Customs
U.S. Customs requires that a commercial invoice provide the following information.
(1) The port of entry
(2) If merchandise is sold or agreed to be sold, the time, place and names of buyer and seller - if consigned, the time and origin of shipment and names of shipper and receiver
(3) Detailed description of the merchandise, in¬cluding the name by which each item is known, the grade or quality, and the marks, numbers, and symbols under which sold by the seller or manufacturer to the trade in the country of exportation, together with the marks and num¬bers of the packages in which the merchandise is packed
(4) The quantities in weights and measures
(5) If sold or agreed to be sold, the purchase price of each item in the currency of the sale
(6) If consigned, the value for each item, in the currency in which the transactions are usually made or, in the absence of such value, the price in such currency that the manufacturer, seller, shipper, or owner would have received, or was willing to receive, for such merchandise if sold in the ordinary course of trade and in the usual wholesale quantities in the country of exporta¬tion
(7) The kind of currency
(8) All charges upon the merchandise, itemized by name and amount including freight, insurance, commission, cases, containers, cover¬ings, and cost of packing; and, if not included above, all charges, costs, and expenses incurred in bringing the mer¬chandise from alongside the carrier at the first U.S. port of entry. The cost of packing, cases, containers, and inland freight to the port of exportation need not be itemized by amount if included in the invoice price and so identified. Where the required information does not appear on the in¬voice as originally prepared, it shall be shown on an at¬tachment to the invoice.
(9) All rebates, drawbacks, and bounties, separately itemized, allowed upon the exporta¬tion of the merchandise
(10) The country of origin
(11) All goods or services furnished for the production of the merchandise not included in the invoice price
The in¬voice and all attachments must be in the English language.
Commercial Letter of Credit
An instrument by which a bank lends its credit to a customer to enable him to finance the purchase of goods. Addressed to the seller, it authorizes him to draw drafts on the bank under the terms stated in the letter - letter of credit
Embassy officials who assist businesses through arranging appointments with local business and government officials, providing counsel on local trade regulations, laws, and customs; identifying importers, buyers, agents, distributors, and joint venture partners; and other business assistance - economic officers
– banking / law
Negotiable instruments used in commerce. Examples of commercial paper are bills of exchange, promissory notes, and bank checks - negotiable instru¬ment - bill of exchange
Economic risk resulting from the normal course of operating a business. Commercial risk includes financial risk, legal risk, production risk, market risk and even the risk of failure to adapt to changing markets and technology - political risk
The primary documents for a shipment of goods. A commercial set usually includes, for example, an invoice, bill of lading, bill of exchange, and certificate of insur¬ance.
An agreement between two or more countries setting forth the conditions under which business between the countries may be transacted. May outline tariff privileges, terms on which property may be owned, the manner in which claims may be settled, etc.
– shipping / logistics
The area immediately surrounding a town or city that is subject to the same shipping rates as the city itself - rate basis point
The packing or mingling of various articles subject to dif¬ferent rates of duty in such a way that the quantity or value of each class of articles cannot readily be ascertained by Customs without the physical segregation of the shipment or the contents of any package thereof. Commingled arti¬cles are subject to the highest rate of duty applicable to any part of the commingled lot, unless the consignee or his agent segregates the articles under Customs supervision.
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