The commercial invoice is a record or evidence of transaction between the exporter and the importer. It is similar to an ordinary sales invoice, except some entries specific to the export-import trade are added. Please see the sample Commercial Invoice below.
Specific Language Requirements in the Commercial Invoice
Certain importing countries may require that the commercial invoice and the packing list be made out in, or translated to, the language of the importing country, for example, in French for shipment to France, in Italian to Italy, and in Spanish to Mexico and Venezuela.
Declaration on Commercial Invoice
The declaration on the commercial invoice for some countries must be in a specified wording. The exporter may check the wording with the customs broker, the government external trade department, or the foreign government trade office concerned in the exporting country.
The content of a typical declaration includes a sworn statement from the exporter indicating that the goods in question are manufactured in the exporting country, and that the amount shown in the invoice is the true and correct value.
The letter of credit (L/C) from certain importing countries, in particular from the Middle East, requires the certification and/or legalization of the commercial invoice.
The certification, which usually is performed by the local Chamber of Commerce of the exporting country, is to confirm that the invoice and declaration (in the invoice) are correct.
The legalization, which is done by The Consulate or The Commercial Section of the Embassy of the importing country, is to verify that the invoice is correct.
The certification and legalization are most often satisfied with a stamp or a seal on the invoice and payment of a fee. The processing time may take one week.
Any visible corrections or changes made in the commercial invoice must be initialled. In practice, the initial usually is done using a rubber stamp bearing the word "CORRECTION".
The commercial invoice and packing list need not be signed, unless otherwise stipulated in the letter of credit (L/C). In practice, the original and the copy of the commercial invoice and packing list are often signed.
The description of the goods in the commercial invoice must correspond with the description in the letter of credit (L/C). In all other documents, the description can be in general terms provided it is not inconsistent with the description in the L/C.
For example, referring to the sample L/C, the description of goods in the commercial invoice should be "'ABC' Brand Pneumatic Tools, 1/2" drive, complete with hose and quick couplings", the description in all other documents can be in general terms like "'ABC' Brand Pneumatic Tools". However, if any other documents indicate "'ABC' Brand Air Tools", it is inconsistent with the description in the L/C for using the word "air", which should be "pneumatic", despite both terms being technically the same. Consequently, there is a discrepancy and the bank will reject the documents.
Marks & Numbers
Please see Shipping Marks and Numbers for detail information.
" Quantity "
If the letter of credit (L/C) does not stipulate the quantity in a stated number of units (i.e., it does not state in units such as piece, set, box, dozen, or gross), or unless the L/C stipulates that the quantity of the goods specified must not be exceeded or reduced, a tolerance of 5% more or 5% less quantity is permitted, provided the total amount does not exceed the amount of the L/C.
In the sample L/C the stated quantity is 100 Sets, thus the quantity in the invoice must be 100 Sets. If such sample L/C does not state the quantity, the UVW Exports can ship between 95 sets and 100 sets of pneumatic tools, but not over 100 sets as the total amount will exceed the L/C amount of US$25,000. If such L/C does not state the quantity and the L/C amount is US$26,250 or more, the exporter may ship between 95 and 105 sets.
If the L/C quantity is indicated using the words "about", "approximately", "circa" or similar expressions, the quantity in the invoice cannot exceed 10% more or 10% less than the quantity indicated in the L/C. For example, if the L/C quantity is "about 100 sets", the quantity in the invoice can be any quantity between 90 sets and 110 sets, provided the total amount does not exceed the amount of the L/C.
" Unit Price "
If the letter of credit (L/C) unit price is indicated using the words "about", "approximately", "circa" or similar expressions, the unit price in the invoice cannot exceed 10% more or 10% less than the unit price indicated in the L/C. For example, if the L/C unit price is "about US$250", the unit price in the invoice can be any unit price between US$225 and US$275, provided the total amount does not exceed the amount of the L/C.
" Amount "
Unless otherwise stipulated in the letter of credit (L/C), the amount must not exceed the amount permitted by the L/C. If the L/C amount is indicated using the words "about", "approximately", "circa" or similar expressions, the amount of the invoice cannot exceed 10% more or 10% less than the amount indicated in the L/C. For example, if the L/C amount is "approximately US$10,000", the amount of invoice can be any amount between US$9,000 and US$11,000.
Enter the complete name and address of the importer (the consignee) in the field (For account and risk of Messrs.). The title Messrs. stands for Messieurs in French meaning gentlemen. It is used to address a business firm in a formal manner, the same way the title Mr., Mrs. or Miss is used to address a person.
Referring to the sample L/C, enter "SB-87654", "January 26, 2001" and "The Sun Bank" in the respective fields in the documents. The sample L/C does not stipulate indicating this information in the documents except the draft(s), thus UVW Exports may choose not to enter it in the documents, but there is no harm if it is entered in the documents.
Referring to the sample L/C, enter "IP/123456" and "January 18, 2001" in the commercial invoice and all other documents, including bill of lading and insurance policy.
The letter of credit may require the documents to show the purchase order (P.O.) or contract number. Referring to the sample L/C, enter "DEF-101" and "January 10, 2001" in the respective fields in the documents.
The department or store number is often required when dealing with the chain stores. It is the identification number of the store or branch of a chain store. The store number is used in the routing of goods by the chain store. It identifies the store that places the order or to which branch (of the chain store) the goods will be delivered.
Shipment on or about is the ETD (estimated time of departure) or the ETS (estimated time of sailing). In practice, the date of loading on board, dispatch or taking in charge is often regarded as the ETD.
The port of loading is the port or point of origin and the port of discharge is the port or point of destination. Referring to the sample L/C, enter "Moonbeam Port, Export-Country" as the origin and "Sunny Port, Import-Country" as the destination in the fields.
The via (tranship at) refers to the transhipping port or point in a transhipment. For example, if a consignment destined for landlocked Afghanistan has to tranship at Karachi, Pakistan, enter "Karachi, Pakistan" in the field.
For transhipment to is the final destination in the onward routing or carriage, which is often the consignee's place (city).