Commercial Invoice
An Essential Document for International Shipments.
Shipping internationally can be a complex process. There are many steps that you need to go through, many things you have to consider, and a bunch documents that you need to prepare. All these are required to ensure a seamless shipping process.
One of the most important documents that will always be mandatory for international shipping is the commercial invoice. In this article, we let you in on everything you need to know about this document, including what it is, what it’s used for, what information needs to be in it, and more.
What is a Commercial Invoice for International Shipping?
A commercial invoice is an important document that is required for international shipping, particularly, for customs clearance. It’s used by customs authorities to determine the taxes and import duties that need to be settled for the particular goods that you are shipping.
By having a complete and correct commercial invoice for customs clearance, the clearing process of your goods will be a breeze and mitigates the risk of delays or issues.
What is a Commercial Invoice Used For?
A commercial invoice is used by the customs authorities in your country of import. It helps them conduct all the formalities required to process and clear your cargo, such as:
- Determining the taxes and import duties that apply to your shipment
- Determining if the cargo meets all the import requirements
- Retrieving information needed for customs clearance in the destination country
Although it’s an integral part of international shipping, some customs authorities do not require a commercial invoice. This is true in the EU and the countries part of it. However, some may provide exceptions. If you are shipping to this part of the world, make sure to do your research on their rules on the shipping invoice and customs requirements.
What Information is Required in a Commercial Invoice?
A commercial invoice can be difficult to accomplish because it asks for very detailed and specific information about the shipper, consignee, and the cargo. However tedious it is, it’s important that it’s done completely and correctly in order to prevent delays and other problems with your shipment.
A commercial invoice would require the following information:
Invoice Information
Information regarding the commercial invoice is the most crucial part of the document. This section will require the following details:
- Invoice number or reference number
- Invoice date of issue
- Order number of the goods
Shipper Information
This section asks for details about the sender of the goods, including:
- Name of the shipper or sender
- Complete address of the shipper or sender, including the postal code or zip code and the city name
- Telephone number of the shipper or sender
- Fax number of the shipper or sender
- Value added tax (VAT) reference number for countries which require the VAT
- Country where the shipper or sender is located
Consignee Information
This section will ask for details about the person who will receive the goods at the destination. It requires the following information:
- Name of the receiver
- Complete address of the receiver, including the postal code or zip code and the city name
- Telephone number of the receiver
- Fax number of the receiver
- Value added tax (VAT) reference number for countries which require the VAT
- Country where the receiver is located
- Notify party or the point person who should be notified when the goods arrive
- Notify party’s address
Shipping Information
This section asks for information about the specific shipment or mode of shipment. It includes:
- Air Way Bill (AWB) number
- Forwarding agent or the name of the shipping company or freight forwarder
- Date of export or shipping date
- Mode of payment for the shipment
Shipment Information
This section refers to the required details for the specific goods that are shipped, including:
- Quantity or number of pieces
- Specification of commodities or a description of the goods in subject
- Gross weight of each piece of the goods
- Quantity of the goods in the cargo
- Unit price or the value of each item
- Amount of each set of goods
- Total weight of the shipment
- Currency used for the pricing or value of the goods
- Total amount or value of the shipment
- Country of origin
- Name of the sender
- Signature of the sender or the company stamp of the freight forwarder/ shipping company.
Commercial Invoice vs. Customs Invoice/ Declaration (CN22 or CN23)
Because both a commercial invoice and customs declaration asks for information about the shipment and the specific goods, people tend to confuse the two as one and the same. However, these are completely separate documents that have different information and functions.
The commercial invoice is categorized as an export document needed for all international shipments. It contains the information that pertains to the goods, the shipment, as well as the Incoterms or agreements between the parties. This document is important for customs authorities because it helps them determine the cost of taxes or import duties.
On the other hand, a customs declaration, also called a CN22 or CN23 form, is used for goods shipped by a postal company. These forms have information about the goods and help customs authorities determine whether or not you owe any taxes for your shipment. Whether you use a CN22 or CN23 form would depend on the value and weight of your shipment.
The bottomline is that CN22 or CN23 forms are only required for cargo that is shipped via a postal service. A commercial invoice, on the other hand, is required for all international shipments.
Conclusion
A commercial invoice is a vital part of the international shipping process and should not be neglected or missed out. Otherwise, it’s going to cause problems with customs clearance. Now that you have a clearer understanding of what it is, you are now in a better position to accomplish your commercial invoice correctly and completely.