Understanding documentation for international trade

Important points to remember

• make sure a clearly written contract is drawn up between your company and the buyer, including details of exactly where goods will be delivered and responsibility through each part of the journey
• make sure you know the specific documents you’ll need to get the goods through customs and to allocate the right duty and tax charges
• you’ll need documentation to cover the transport of the goods and insurance during the journey
• the right paperwork can be an important part of the payment mechanism
• consider requirements for the country the goods are being exported from and the country they’re being imported into

Co-operate and get help if needed

It’s important to co-operate with your counterpart on getting the paperwork right. For example, if you’re shipping goods to a customer overseas, they should tell you what paperwork they require at their end.

If you’re dealing with a non-English speaking country, it can be a good idea to provide an extra set of commercial documents in the local language.

You may want to get help with handling paperwork. Many businesses use the services of a freight forwarder. Read our advice about using a freight forwarder.

Trade documentation

It’s wise to seek advice on this if you’re unsure. Your local Chamber of Commerce should be able to advise you on what you’ll need, and you can also ask your customer. There are some common types of international trade documentation which you may need to export:

Certificate of origin (COO)

This states where a product was produced, manufactured or processed. It may be required for customs clearance in your destination market. Your Chamber of Commerce can issue these.

Commercial invoice

This provides information for the customs authorities, which helps them asses if the goods can move in or out of a country and what, if any, controls are needed. It also helps them determine duties and taxes. Every shipment must have its own commercial invoice.

Packing list

A packing list is the only way in which a consignment can be cleared for entry into a new market and most importantly the only way in which the border crossing or customs officer can tell what is supposed to be in each carton being delivered overseas.

UK export licence

There are special UK requirements for some controlled goods, such as firearms, medicines, plants and animal products - a licence may be required. Read guidance on whether you'll need an export licence on GOV.UK.

Local regulations

If you are exporting, you should check whether any special documentation is required overseas to satisfy local regulations. For example, you might need documentary proof that your goods meet local product standards.

Dangerous goods

Dangerous goods must be accompanied by appropriate special paperwork. Read the guide on transport document completion on GOV.UK.

Insurance

You may need to insure the goods, and you may also be required to provide proof of insurance to your customer, particularly if you are passing on the costs. You should discuss what documentation is required with your customer and your insurer.

Transport documentation

Transport documentation is needed to provide instructions to the carrier on what should be done with the goods. It is also used to define responsibility for, and sometimes ownership of, the goods during their journey.

Read an overview of how to complete transport documents in the guidance on transport document completion on GOV.UK.

Common types of international transport documentation include:

Export cargo shipping instruction

An export cargo shipping instruction gives the freight forwarder details of the goods and how they are to reach their destination.

Standard shipping note

This contains information about your goods and the companies involved in sending, shipping and receiving them. You must use a standard shipping note if you’re shipping goods overseas.

Bill of lading or a waybill

A Bill of Lading (sea transport) or a waybill (air transport) act as documentary evidence that your carrier has received the goods.

You should keep these as evidence in case there are any later problems with the shipment.

CIM consignment note

A CIM consignment note gives details of the goods being transported.

If you are shipping dangerous goods, you must also complete a dangerous goods declaration. See guidance on moving dangerous goods on GOV.UK.

Proof of insurance

You may need to insure the goods, and you may also be required to provide proof of insurance to your customer, particularly if you are passing on the costs. You should discuss what documentation is required with your customer and your insurer.

Read an overview of how to complete transport documents in the guidance on transport document completion on GOV.UK.

Payments documentation

The right paperwork plays an important part in making and receiving payment. It reduces the risks of the customer failing to pay, or the supplier failing to deliver.

Common types of payment documents you should consider include:

Bank collection or documentary collections (D/C)

When using the documentary collection, the exporter prepares a bill of exchange stating how much is to be paid and when.

The exporter's bank issues instructions to the buyer’s bank for release of the documents against either payment (documents against payment) or acceptance of a bill of exchange (documents against acceptance). In the latter, the buyer agrees to make payment at a certain future date.

A documentary collection is used primarily for shipments by sea.

Letter of credit, also known as a documentary credit

A letter of credit (L/C) is a guarantee from a bank on behalf of the buyer.

The buyer's bank agrees to pay the exporter once all the right documentation - such as transport documents showing the right goods have been despatched - is received. The exporter must provide the required paperwork within the agreed time limit and with no discrepancies.

If you are using one of these payment methods, it’s important to understand what documentation is required and ensure it is accurate. Payments under letter of credit can be particularly problematic, as the exporter must provide exactly the right documentation to get paid.

See the guide on getting paid when selling overseas.

Regardless of what payment method you agree, you should have a clear written contract stating what amount is due, in what currency, and when. The contract should also make it clear who is responsible for any bank charges and who is responsible for goods throughout the export process.

See our guide on Incoterms in international trade contracts.