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October 26, 2021

International Shipping Documents: A Comprehensive Guide for SMBs

If you're in the shipping business, then you know that international shipping comes with a whole host of unique challenges.

From filling out the correct paperwork to making sure your packages comply with customs regulations, there's a lot to keep track of. And if you're not careful, the whole process can quickly become overwhelming.

That's why we've put together this comprehensive guide to international shipping documents.

We'll cover everything you need to know about the most important documents involved in international shipping, as well as some tips on how to keep track of everything.

With the soaring prices of container freight rates, you can't afford to overlook any aspect of shipping your products around the world.

Whether you're shipping small packages or large containers, international trade documents are essential for ensuring that your shipments arrive safely and on time.

Our guide to international shipping documents will help you navigate the sometimes-tricky world of international shipping documents.

What Are Trade Documents?

Trade documents are an integral part of the shipping process, and they come in many different forms.

At the most basic level, trade documents are used to verify the contents and destination of packages being shipped internationally. They help ensure that your shipments comply with customs regulations while also providing important information about where and how a package is traveling.

Shipping documents are essential for the smooth transportation of goods. These documents provide evidence of what has been shipped, who is shipping it, and where it needs to go. Without proper documentation, delays and mix-ups are inevitable.

Types of Shipping Documents

When shipping internationally, there are certain documents that are required in order for your shipment to clear customs. There are also some documents that are optional but may be required by your freight forwarder or the country of import.

Required Documents

Export/Import License

Depending on the shipping destination, you may need to obtain an export or import license before shipping your goods. This document allows you to legally move products across international borders and is often required by customs officials before clearance of a shipment.

To apply for an export or import license, you will need information about the shipping products themselves and their shipping destination.

Bill of Lading (BOL)

The bill of lading (BOL) is perhaps the most essential shipping document, as it serves as proof of ownership and provides information about the contents of your shipment. It will typically include details about who is shipping the package, as well as any special instructions or requirements that need to be followed.

In addition to the shipping information, this document serves as a contract between the shipper and the carrier. The carrier issues at least three copies of the bill of lading, one for each party:

  • The shipping company or carrier which will use this document to track and protect your shipment
  • The consignee or recipient who receives the goods and can use this document as proof of ownership
  • The shipper who may need to provide this document as proof of shipping contents

Commercial Invoice

A commercial invoice is one of the primary shipping documents that should be included in an export document set. It is used to declare the value of your shipment, as well as shipping and payment terms.

When preparing an invoice, you must specify incoterms or delivery terms and the products' HS codes. If you make an invoice that includes the product packages' numbers, dimensions, and weight information, you may not need to prepare a packing list separately.

The commercial invoice is used by customs officials to determine tariffs and other charges, which is why it's vital that you fill it out accurately and completely to avoid any issues later on.

Here's the necessary information a commercial invoice should include:

  • Description of the goods
  • HS Code for the goods (8-10 digits)
  • Number of goods
  • Invoice Value
  • Country of Origin
  • Specified delivery terms with the city name
  • Shipper (seller) company name, address, contact details
  • Consignee (buyer) company name, address, contact details
  • Payment terms, including the bank account and banking details

Proforma Invoice

A proforma invoice is very similar to a commercial invoice, with one key difference: a proforma invoice does not include shipping or payment terms.

This document is often used for international transactions, as it allows buyers and sellers to agree on shipping details upfront. This can help expedite shipping processes once the final sale is complete.

In order to prepare a proforma invoice, you should include the same information as a commercial invoice but without shipping and payment terms.

Packing List / Weight List

The packing list is used to provide detailed information about the contents of your shipment. It will include product descriptions, shipping weights and quantities, total shipping costs, as well as any additional shipping restrictions or limitations.

The packing list is typically used to track the shipping process, as well as to ensure that your shipment corresponds with what's listed on the shipping documents. This document may also be required by customs officials to determine any applicable tariffs or duties.

If you're shipping a large quantity of goods, it may be helpful to prepare a weight list that provides shipping weights and totals. This can help you monitor shipping costs, as well as provide the necessary information to customs officials when required.

We advise you to make the packing list as detailed as possible to ensure the smooth and efficient shipping of your goods.

Certificate of Origin (CoO)

A certificate of origin is a shipping document that serves as proof that your goods are originating from a particular country. In other words, this document verifies the commercial goods' country of origin since taxes and exempts vary by country.

For instance, you may qualify for preferential treatment under a Free Trade Agreement (FTA) between your shipping destination and country of origin. Or, you may need to import your goods with a CoO so they can be exempt from paying tariffs or other charges.

To prepare a CoO, you will need information about the shipping products and their place of manufacture. At a minimum, the certificate of origin should include:

  • The shipping company or carrier that issued it
  • The shipping date and location of origin
  • The signature of the issuing authority

Depending on your shipping destination, there may be additional requirements for the certificate of origin. Consult with customs officials to determine if any special documentation is needed for your shipment.

Customs Declaration Form (Bill of Entry)

As the shipping documents' final component, a customs declaration form (Bill of Entry) is used to declare any import restrictions, requirements, and declarations for your shipping goods.

This document will typically include information about your shipment's value, commodity type and classification, country of origin or manufacture, and shipping details such as packing lists and weight information. It can also include more specific information about your shipping goods, such as the type of packaging used and any special shipping restrictions.

When preparing a customs declaration form for international shipping, it is critical to provide accurate and complete information. Any discrepancies or errors in this document may cause delays in the shipping process or result in additional charges from customs officials.

This document is valid only at the customs of the country where it is prepared. Therefore, the export declaration does not need to be sent to the importing company. The closure of the import declaration indicates that the import process is over, and the importer company can receive the products.

Airway Bill

An airway bill is a shipping document that serves as proof of shipping and shipping contents.

Similar to a bill of lading, an airway bill outlines important details about your shipment, such as the shipping company or carrier, origin address and destination address, shipping date and time, weight information, and cargo list.

This shipping document is typically used for shipping products via air or other air-based shipping methods. However, it may also be used for shipping via ground transportation if the shipment is time-sensitive or of high value.

Optional Documentation

Insurance Certificate

If you are shipping high-value or fragile goods, you may want to purchase shipping insurance to protect your products in the event of damage or loss during transit.

An insurance certificate is evidence of insurance coverage. It is issued by an insurance company or broker as confirmation that an insurance policy has been placed into effect. The certificate outlines the insurance coverage, including the effective dates, the limit of liability, and the named insured.

It's a shipping document that's required by import customs clearance only. However, the incoterms you put on your invoice not only show who is responsible for shipping costs but also indicate who would be liable in case of damages. If the exporter does not insure due to incoterms, it is the importer company's initiative to issue an insurance policy.

Arrival Notice (Inward Cargo Manifest)

The arrival notice is a shipping document that is sent from the shipping company or carrier to your importing department once the shipment has been received by customs. This document confirms that shipping products have arrived at their destination and are now available for pickup or delivery.

Depending on your shipping terms, you may also be required to pay duties and taxes upon the arrival of your goods. In this case, you will need to work with your shipping company or carrier to coordinate the payment and pickup of these charges.

An arrival notice includes detailed information about the cargo being shipped:

  • Shipper's and consignee's name and address
  • A description of the goods being shipped
  • Any charges that need to be settled upon delivery

Customs officials use this information to assess duties and taxes owed on the shipment, but businesses can also use this information to track shipments and plan for receiving goods.

Import License

Depending on the regulations in your shipping destination, you may also be required to obtain an import license before shipping goods into that country.

Imports of certain products may be subject to special authorization. Some products, such as drugs, explosives, weapons, and the like, are subject to special approval in many countries. Therefore, only companies with import licenses can import such products.

An import license is a document issued by government agencies or regulatory bodies that allows businesses to import goods into a specific jurisdiction. This document typically includes details about the goods being shipped, any restrictions or requirements for shipping, and the shipping permits or licenses that have been issued to you by the government.

To obtain an import license, businesses may need to provide specific documentation related to their shipping goods, such as a product description, shipping manifests, shipping contracts with carriers or shipping companies, or proof of inventory and value. Additionally, some countries may require businesses to pay a fee or complete additional shipping requirements in order to obtain this license.

Customs Bond

A customs bond is a type of surety bond required by the US government for certain imports and exports. The bond ensures that businesses comply with customs regulations and pays any duties or tariffs owed to the government.

Not all shipments require a customs bond, but if your business ships goods internationally, there's a good chance you'll need one at some point.

A customs bond is a financial guarantee that shipping companies and carriers must provide prior to shipping products across international borders. This guarantee acts as security in case shipping businesses fail to pay applicable duties, taxes, or other fees related to shipping or importing products into the country.

You only need a customs bond if your shipment is valued at more than $2,500. If your shipment is valued at less than $2,500, you can self-insure instead of getting a bond.

Certificates of Inspection

A certificate of inspection is a shipping document that certifies that a product or shipment has been inspected and meets all applicable standards.  It is typically issued by a shipping or logistics company after assessing the quality, safety, and other requirements of a product.

Certificates of inspection are essential for several reasons. They:

  • Provide documentary evidence that a shipment has been inspected and found to be in compliance with all relevant regulations
  • Can help streamline the customs clearance process
  • Can help businesses build credibility with their customers and partners

Usually, certificates of inspection are necessary for products that are shipped internationally, such as food and pharmaceuticals. However, shipping companies may also require a certificate of inspection for certain other types of goods. If you are shipping products that could potentially be impacted by safety or quality concerns, it's vital to check with your shipping company to see if a certificate of inspection is required for your shipment.

Letter of Credit

A letter of credit is a document issued by a financial institution that guarantees payment to the beneficiary (seller) as long as the terms and conditions of the letter of credit are met. In other words, it's a form of protection for businesses involved in international trade.

There are several reasons why your business might need a letter of credit, including to:

  • Ensure that you're paid on time
  • Protect against defective or undelivered goods
  • Reduce your risk when doing business with new trading partners
  • Simplify cross-border transactions

While it's not a shipping document used for customs clearance, it's an essential tool for many businesses involved in international shipping. If your company regularly ships products overseas, it's important to understand the role of a letter of credit and how to get one if needed.

Certificate of Analysis (COA)

A Certificate of Analysis (COA) is a document that provides information about a product's chemical makeup and purity. COAs are commonly used in the shipping industry to ensure that products meet quality standards.

There are several reasons why shipping companies may require a COA when shipping products internationally. One of the primary reasons is to ensure that products meet all applicable regulatory requirements, such as local health and safety standards or restrictions on certain chemicals and substances.

For example, assume you're shipping a food product from one country to another. The receiving country may have specific regulations about the maximum allowable level of certain contaminants (e.g., lead, mercury, etc.). A COA can help to ensure that your product complies with these regulations and is safe for human consumption.

Overall, shipping companies typically only request a COA for products that are considered a higher risk, such as those that may have a direct impact on human health or the environment. However, shipping companies may also request COAs for certain specialty products, such as pharmaceuticals or high-value items.

Shipper’s Letter of Instruction

A shipper's letter of instruction is a shipping document that provides information to the freight forwarder or carrier about the shipper's (your) instructions for the handling of the shipment.

The letter of instruction may also be used to give instructions to an agent, customs broker, or another third party. This may include details such as shipping methods and packaging requirements, delivery deadlines, special shipping instructions, and contact information for the shipper.

It helps to ensure that your shipment is handled according to your specific instructions, which can help to avoid delays and problems. In addition, if there are any issues with the shipment, having a shipper's letter of instruction can help to resolve them quickly and efficiently.

Importer Security Filing (ISF)

An Importer Security Filing (ISF) is a document that must be filed with U.S. Customs and Border Protection (CBP) for all ocean shipments entering the United States. The ISF must contain 10 elements of data about the shipment, including the seller and buyer, ports of origin and destination, Ship-To and Notify-Party information, and more.

The importer is responsible for filing the ISF, and the information must be filed at least 24 hours prior to the ship's departure from a foreign port. ISFs are required for all ocean shipments arriving to the U.S., regardless of whether they're shipping high-value items or consumer goods.

There are several benefits to filing an ISF, including ensuring that your shipping company understands the shipping requirements for your cargo, protecting against delays and penalties, and reducing shipping risks. For example, if there are any issues with your shipment once it reaches the U.S., having an ISF on file can help to resolve them quickly and efficiently.

Quotation

The quotation shipping document is typically used when shipping high-value or bulky items requiring special handling, such as shipping multiple items or fragile or time-sensitive products.

A quotation is typically a detailed and comprehensive document that includes information about all shipping requirements for your item, including the shipping method, packaging requirements, delivery deadlines, and shipping costs. It also often contains contact information for the shipping company to help ensure that there are no issues with your shipment.

What Is The Most Important Document for Shipping Internationally?

There is no single "most important" shipping document for shipping internationally, as the specific requirements and regulations that apply to shipping vary depending on a number of factors, including the destination country, the type and quantity of goods being shipped, and any special shipping requirements.

However, most shipping experts would agree that the bill of lading is one of the most critical shipping documents, as it provides essential details about the shipment and acts as proof of ownership. It is also typically required by customs officials in order to clear your package through international shipping channels.

Shipping Documents Required for Export and Import

Export Documents Checklist

  • Bill of lading or Airway Bill
  • Proforma invoice
  • Commercial invoice
  • Packing list
  • Customs declaration form
  • Export license
  • Certificate of Origin
  • Export declaration form
  • Insurance certificate

Import Documents Checklist

  • Bill of Lading or Airway Bill
  • Proforma invoice
  • Commercial invoice
  • Packing List
  • Customs declaration form
  • Import license
  • Insurance certificate

the shipping documents required for import and export, including an exports document checklist and an import document checklist

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