Glossary

The AAD is a 4 part control document that covers the movement of excise goods moving in duty suspension between EC Member States and also for exports of similar goods from the Community. It contains relevant information about the consignment, its origin and destination, and provides confirmation that the consignee has received the goods. For more information on the use of AAD's see Customs Notice 197.

The undertaking written on the face of a bill of exchange and signed by the drawee to pay the face amount of the bill on the due date, usually in exchange for documents of title to goods shipped on documents against acceptance terms (an alternative name for an accepted bill of exchange).

According to Value.

A Guarantee or bond usually issued by a bank that provides the buyer with acceptable security if the exporter fails to fulfil its obligations in the underlying contract. If the exporter requires a sum of money in advance of shipping the goods they may do so in return for an acceptable advanced payment guarantee. However, the exporter should be aware that they may not have access to that money as the bank may hold the money as security for the guarantee.

Documentary Credits -The act of a bank notifying/conveying the terms and conditions of a documentary credit to the beneficiary. The advising bank is the issuing bank's agent, usually located in the beneficiary's country.

Guarantees - A foreign bank requested by the issuing bank (the Guarantor) to forward the latter's original Guarantee to the Beneficiary. The advising bank is not a party to the Guarantee therefore it does not incur any liability under the guarantee.

Air Waybill (AWB) is the most important document issued by a carrier either directly or through its authorised agent. It is a non-negotiable transport document. It covers transport of cargo from airport to airport. By accepting a shipment an IATA cargo agent is acting on behalf of the carrier whose air waybill is issued. The AWB is a Contract of Carriage and Evidence of receipt of goods. 

An Insurance Policy that covers losses from all causes not specifically excluded in the policy.

For a Documentary Credit this is the person/company, usually the importer, on whose behalf a documentary credit is issued (also known as the Opener or Buyer). For a Guarantee this is the party that requests their bank to arrange the issue of the guarantee.

In cases of disputes with overseas buyer or supplies arbitration can be a way forward to resolution. Arbitration is a legal technique for resolution outside the courts. In International Trade the ICC (International Chamber of Commerce) arbitration service is recognised worldwide.

Irrevocable assignment by the beneficiary of a letter of credit, or a portion of its proceeds, to a third party (usually the manufacturer or supplier of the exported goods). This assignment generally takes the form of a deed of assignment given to the advising bank thereby authorising the bank to pay the amount in the assignment when proceeds from the Letter of Credit have been received.

An ATA Carnet is an international customs document that allows the holder to temporarily (up to one year) import goods into countries who are part of the Carnet Convention without payment of normally applicable duties and taxes, including value-added taxes.

The Carnet eliminates the need to purchase temporary import bonds. So long as the goods are re-exported within the allotted time frame, no duties or taxes are due. Failure to re-export all goods listed on the Carnet results in the need to pay the applicable duties. Failure to remit those duties results in a claim from the foreign customs service to the customs authority in the Carnet holder’s country.

An ATR is a preference document for Turkey. The document allows the importer to clear the goods in Turkey without paying duty or paying a reduced rate of duty depending on the goods. The document can be issued for all goods that are in free circulation in the EU i.e. goods that have had all duties applicable in the EU paid. Although the document proves that goods are in free circulation it does not prove EU origin. The Turkish importer may also request a Certificate of Origin to prove the actual origin of the goods. Customs Notice 812 gives further information on ATR's.

The act of a bank guaranteeing payment of a bill of exchange or promissory note by endorsing the reverse of the instrument with the words “good per aval” and signing under the annotation, or by issuing a separate guarantee of payment. 

The term 'Average' has two meanings:

In marine insurance, in the case of a partial loss, or emergency repairs to the vessel, average may be declared. This covers situations, where, for example, a ship in a storm might have to jettison certain cargo to protect the ship and the remaining cargo. 'General Average' requires all parties concerned in the venture (Hull/Cargo/Freight/Bunkers) to contribute to compensate the losses caused to those whose cargo has been lost or damaged.

'Particular Average' is levied on a group of cargo owners and not all of the cargo owners.

In the situation where an insured has under-insured, i.e. insured an item for less than it is worth, average will apply to reduce the amount payable. There are different ways of calculating average, but generally the same proportion of under-insurance will be applied to any payout due.

An average adjuster is a marine claims specialist responsible for adjusting and providing the general average statement. He is usually appointed by the ship owner or insurer.