GLOSSARY OF TERMS
Bill of Lading: A document of title issued by the master of the vessel to the shipper (consignor) of the goods upon receiving goods on board for shipment. Now a days, the bill of lading is issued by the agent of the ship on behalf of the master.
Bonded manufacturing: A scheme under the control of Customs where manufacturing in a bonded warehouse is carried out using raw materials imported free of import duty and levies. The output products may be re-exported or allowed local disposal on payment of applicable duties and levies.
Bonded warehouse: any secure place or building appointed by notice and published by the Director General of Customs with the approval of the ed of the Minister of Finance, for deposit of goods free from Customs duty and levies.
“Shall mean any place provided by the Minister in which goods entered to be warehoused may be lodged, kept, and secured without payment of duty, although prohibited to be used in Sri Lanka. (S167 of the Customs Ordinance of Sri Lanka)”
Bonded warehousing scheme: Is the scheme to facilitate the establishment of a Bonded warehouse in Sri Lanka and also the operation of the same under the rules and conditions of issued by Director General of Customs.
Break bulk cargo: Goods that must be loaded individually, and not in intermodal containers nor in bulk as with oil or grain.
Bulk cargo: Cargo transported unpacked in large quantities, such as oil and grain.
Bunkering: Supply of fuel to ships and aircrafts for their consumption during voyage international.
Cargo Dispatch Note (CDN): A document furnished by the shippers of goods to Customs as they are delivered to the port for Export.
CESS: A tax collected on certain products at export.
CIF: Cost of goods, Insurance charges, and Freight charges involved in shipping of goods. CIF is the basis for value of goods for Customs purposes in Sri Lanka.
Commercial Invoice: An important contractual document in international trade between buyer and seller specifying description, quantity, terms of delivery, and value of the goods transacted by sale.
Consignor: The person or a company who consigns the goods. If a consignment is moved to a foreign country, the consignor becomes an exporter or a shipper. [The consignor also can be a seller who sells the goods in domestic market.]
Conversion ratio: The quantity of input (raw material) used to manufacture one unit of final product.
Conversion: The process of converting raw materials to final product.
Customs bond: A warehouse approved and under the control Customs for safe keeping of imported goods free of Customs duty until they are put under a subsequent customs procedure.
Customs duty: A tax collected by Customs on goods imported or exported.
Deemed Export: The act of supplying goods manufactured under an export-oriented facility, to a party who is eligible for receiving such goods free of Customs duty and levies.
Delivery Order: A document issued by ship’s agents to the importer/agent for taking delivery of goods from the port operators, upon collecting original bill of lading form the consignee.
Direct Export: An export of goods by the manufacture himself.
Export: the act of supplying or caused to be supplied of goods to a destination outside of Sri Lanka.
Exporter: The person or the company that moves goods out of the border of a country and bound to make a declaration to the Director General of Customs for the clearance of goods for export.
The exporter receives the value of goods from the overseas buyer, as exporter is the ‘seller’ of goods, against order placed by the buyer.
FOB: Free-on-Board. Usually refers to the value and cost of the goods up to the time they are received on board the vessel for shipment for export. FOB value is the basis for value of export goods for Customs purposes in Sri Lanka.
Freight Charges: The amount charged by the carrier to transport the goods from the origin to the destination.
Freight: Goods that are transported from origin to destination.
Import: The act of bringing in or caused to be brought into any commodity or service to a country from another for use of such person or put up for sale.
Importer: The person who causes an import of goods become the importer for Customs purposes.
Indirect Export: When a manufacturer supplies his finished goods to another person to export together or incorporated with the goods of the latter, constitutes an indirect export.
Inputs: raw materials, components, and consumables (both imported and local) put into the process in order to process, value add, assemble or manufacture a product (output).
Inward Processing Scheme: a procedure that relieve inputs from Customs duty and levies and deferment of value added tax at import.
Inward Processing: import of raw materials, components and consumables (inputs) etc., for processing, value addition, or manufacture of products for export with or without incorporating local material.
Outputs: the product resulted from processing, value addition, assembly or manufacture of raw materials, components, consumables (inputs) put into the process.
Outward Processing: Outward processing is the opposite of inward processing. It allows local goods to be sent for processing abroad. When the goods come back into the country, duty and levies have to be paid only on the valued added abroad, for clearance from Customs and put into free circulation.
Pro-forma Invoice: an initial bill of sale sent to buyers in advance of a shipment or delivery of goods. This typically describes the negotiated items for purchase and other important information such as the transport and insurance charges.
Public warehouse: A warehouse owned and operated by the Sri Lanka Ports Authority (SLPA) for storage of goods until Customs formalities are completed and release of goods.
Shipper: The person or a company ships the goods, whose details are mentioned in the shipping documents. It can be also be the exporter who procures the goods or manufacturer of goods. The shipper need not be a registered exporter. The shipper can be a freight forwarder also who transfer the goods to main carriers for on carriage.
Shipping Note (SN): A document passed through Customs with the goods for export notifying the master of the vessel, that the goods taken on board have been duly passed by Customs for shipment.
TIEP-I: Temporary Import for Export Processing, scheme to facilitate inward processing operations other than textiles and apparels industries.
TIEP-IV: A scheme to facilitate exporters to import of plant machinery and equipment.
TIN: Taxpayer Identification Number. This number is issued by the department of Inland Revenue and used also by the department of Customs for identification of the importers and exporters.
Value added tax (VAT): A tax collected on the added value on supply of goods and services. Customs also collects VAT on goods at the import as a Customs duty on the basis of the value of the goods and calculated standard profit.
Value addition: the amount by which the value of an article is increased at each stage of its production, exclusive of initial costs.
Warehouse: Any place provided for the deposit of goods on the landing or for shipment thereof for the security of the Customs. (S167 of the Customs Ordinance of Sri Lanka).
Waste: Material resultant after use in any process which has no further use and discarded.