Foreign trade terms refer to the professional terms used in international activities, which involve commodities, transportation, payment, contracts, insurance, etc.
Mastering foreign trade terminology can not only help you communicate effectively with foreign customers, but also allow you to better understand foreign trade processes and rules, and improve your foreign trade business level.
This article will introduce you to some commonly used foreign trade terms, so that you can easily grasp the professional knowledge of international **.
1. Terms
*Clause refers to the goods** and the mode of delivery agreed by the buyer and seller in the contract, which determines the ownership, risk and cost division of the goods. The common ** clauses are:
EXW (EX Works) Ex Works.
FCA (Free Carrier) is a free carrier.
CPT (carriage paid to) is paid to the destination.
CIP (carriage and insurance paid to) The insurance premium is paid to the destination.
DAT (Delivered at Terminal) is delivered at a terminal at the destination or destination port.
DAP (Delivered at Place).
DDP (Delivered Duty Paid) CIF rate.
FOB (Free On Board) fob.
CFR (Cost and Freight).
CIF (Cost, Insurance and Freight) Cost, Insurance and Freight.
2. Payment Terms
The payment clause refers to the payment method and time agreed by the buyer and the seller in the contract, which determines the payment terms and security of the goods. Common payment terms are:
T (Telegraphic Transfer).
l c (letter of credit).
DP (Document Against Payment).
d a (document against acceptance).
B g (Bank Guarantee).
III. Conditions of Carriage
The terms of carriage refer to the mode of transportation and responsibilities of the goods agreed by the buyer and the seller in the contract, which determines the transportation channels and safety of the goods. Common shipping terms are:
b l (bill of lading).
AWB (Air Waybill).
CMR (Consignment Note) A road transport document.
MTR (Multimodal Transport Document).
FCR (Forwarder's Cargo Receipt).
4. Contract Terms
The terms of the contract refer to the quality, quantity, packaging, delivery period, claim, breach of contract and other matters of the goods agreed by the buyer and the seller in the contract, which determines the transaction rules and guarantees of the goods. Common contract terms are:
PI (Proforma Invoice) proforma invoice.
PI refers to a type of pre-issued invoice provided by the seller to the buyer, usually to confirm an order or apply for a letter of credit.
PO (Purchase Order) purchase order.
PO is a formal order provided by a buyer to a seller, usually to confirm the demand or payment for goods.
QC (Quality Control) quality control.
QC refers to the process of inspecting and testing goods, usually carried out by the seller or a third-party agency, to guarantee that the goods meet the requirements of the contract.
QA (Quality Assurance).
QA refers to the process of warranting and certifying goods, usually carried out by the buyer or a third-party agency, to guarantee that the goods meet international standards or approvals.
MOQ (Minimum Order Quantity).
MOQ refers to the minimum quantity that the buyer must order as specified by the seller, and is usually used to control production costs or inventory risk.
LC (late delivery clause).
LC refers to the compensation or penalty to be paid by the seller to the buyer for late delivery of the goods as stipulated in the contract, usually calculated as a percentage of the purchase price per day.
FC (Force Majeure Clause).
FC refers to the clause in the contract that the seller can be exempted from liability or postpone performance when the seller is unable to perform its contractual obligations due to force majeure events, usually including natural disasters, wars, strikes, etc.
IC (Inspection Certificate).
IC refers to a kind of certification document issued after the inspection of the goods, usually issued by a third-party agency or ** department, to prove that the goods meet the requirements of the contract or national standards.
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5. Insurance Terms
The insurance clause refers to the type and amount of insurance that the buyer and seller need to insure during the transportation of the goods agreed in the contract, which determines the safety guarantee and compensation conditions of the goods. Common insurance terms are:
WPA (with particular **erage)
WPA refers to a basic type of marine insurance that only covers loss or damage to goods caused by natural disasters or ship accidents.
FPA (Free from Particular **Erage) Insurance.
FPA refers to a minimum form of marine insurance that only covers the total loss of cargo due to the sunk, collision or fire of a ship.
AAR (All Risks) Comprehensive Insurance.
AAR refers to one of the most extensive marine insurance policies that indemnify all possible loss of or damage to goods except as expressly excluded by the contract.
War (war risk).
WAR refers to a special type of marine insurance that compensates for loss of or damage to goods caused by war, hostilities, or armed conflict.
SRCC (Strike, Riot and Civil Commotion).
SRCC refers to a special type of marine insurance that covers loss of or damage to goods caused by strikes, riots, or civil commotion.
CL (Cargo Clause).
CL refers to the specific content and scope of cargo insurance stipulated in the insurance contract, which is usually divided into three different levels: A, B, and C, corresponding to AAR, WPA, FPA, and FPA.
IL (Institute Cargo Clause).
IL refers to a standard set of cargo insurance clauses developed by the International Marine Insurance Association and is generally widely adopted and cited.
PI (Policy of Insurance) insurance policy.
PI refers to a formal insurance certificate issued by the insurance company to the policyholder, which proves that the policyholder has insured the goods in accordance with the requirements of the contract, and stipulates the type, amount, and duration of insurance.
6. Clause of Origin
The clause of origin refers to the ** country or region of the goods agreed by the buyer and the seller in the contract, which determines whether the goods enjoy preferential tariffs or other ** preferences. Common terms of origin are:
CO (Certificate of Origin).
CO refers to the document that certifies the country or region of the goods, which usually needs to be submitted at the time of import customs clearance in order to enjoy preferential tariffs or other ** benefits.
Form A GSP Certificate of Origin.
Form A refers to a special certificate of origin that certifies that goods originate from a developing country or region that is eligible for GSP treatment in order to benefit from MFN tariffs or exemptions.
Form B General Certificate of Origin.
Form B refers to an ordinary certificate of origin that is used to prove that the goods are from a country or region that has an agreement or relationship with the importing country** in order to enjoy preferential tax rates or other ** benefits.
Form e ASEAN Free ** Zone Certificate of Origin.
Form E refers to a special certificate of origin that certifies that goods originate from member states of the ASEAN Free Zone** in order to benefit from zero tariffs within ASEAN.
Form F Certificate of Origin in China-ASEAN Free ** Zone.
Form F refers to a special certificate of origin that certifies that the goods originate from China or a member of the ASEAN Free ** Zone, in order to enjoy zero tariff in the China-ASEAN Free ** Zone.
Form P Certificate of Origin in China-Pakistan Free Zone**.
Form P refers to a special certificate of origin that is used to prove that the goods are from China or Pakistan in order to enjoy zero tariff in the China-Pakistan Free ** Zone.
GSP (Generalized System of Preferences).
GSP refers to an international** system, a non-discriminatory, non-reciprocal, non-mandatory preferential tariff system provided by developed countries to developing countries, aiming to promote the economic development and growth of developing countries.
MFN (most-f**ored-nation).
MFN refers to an international ** system, a basic principle observed among the member states of the world ** organization, that is, any preferential conditions offered by any member state to any other member state must be offered to all other members at the same time and unconditionally.