Reyansh Goswami

The United States-Mexico-Canada Agreement, or USMCA, is a trade agreement between the United States, Mexico and Canada. It is similar to the North American Free Trade Agreement (NAFTA), but some specific areas have been updated from the previous agreement. Those areas include updates to the automotive industry, energy, and digital trade or e-commerce.

As a rule, every consignment from abroad is liable to customs duty and VAT. As the recipient of a consignment from abroad, you pay the necessary VAT on the value of the goods and customs duty on the gross weight. Depending on the goods, other fees may be charged. These costs should nevertheless not be confused with the carriage charges paid by the sender when the consignment is posted.

OFSI aims to engage with applicants on the substance of a completed licence within four weeks. This does not mean a licence will necessarily be issued within four weeks. Each case is dealt with on a case-by-case basis. More complex cases may take longer to resolve and the Office of Financial Sanctions Implementation may need to come back to you for more information. Sometimes the Office may need to notify, or seek approval from the European Commission or the relevant United Nations Sanctions Committee before they can issue a licence. These requirements are set out in the relevant United Nations Security Council resolutions or EU regulations. These requirements will lengthen the processing time for such licence applications and may, in some cases, prevent a licence being issued.

Post shipment credit is extended to exporters by bank with low interest rate till realization of their export proceeds. Post shipment loan helps exporters to get finance without waiting amount of sales from their overseas buyers.

Post shipment credit means any loan or advance granted or any other credit provided by a bank to an exporter of goods or (and) services from the date of extending credit after shipment of goods or (and) rendering of services to the date of realization of export proceeds as per the period of realization prescribed by FED, and includes any loan or advance granted to an exporter, in consideration of, or on the security of any duty drawback allowed by the Government from time to time. Banks serves with low interest rate to exporters under post shipment credit based on the guidelines of Reserve Bank.

Since the current instructions of FED, the period prescribed for realization of export proceeds is 12 months from the date of shipment, and if amount has not been realized from overseas buyer within the stipulated period, bank can crystalize such export bills with commercial interest rate.

It all depends upon your skills and efficiency to obtain products and services. Ordering from the factory is beneficial when you have a bulk order, you can purchase it at a direct factory price rate. This also reduces the cost of a middleman. However, dealing with a trading company has its own advantages. It reduces the risk of factory audits. For instance, if you have ordered something and paid in advance and after that, the factory shuts down, you will most probably lose your money. In such cases, the trading company would have been a better option as they are accountable. And also a trading company has better customer service in comparison with factories. Trading companies have a variety of products to offer compared to factories but it is good only for small quantity buyers. Both have pros and cons, this duly depends upon the nature of your business and requirements.