International Transport Documentation
The following gives a very brief overview of the types of customs documentation used within the international transport community. With the varying types of transport operations, operators and drivers will become aware through either the handling of these documents or through the basic knowledge of their process of what is required for the loads they carry throughout Europe and beyond.
CMR Document (Convention relative au contrat de transport international de marchandises par route)
The most commonly used document by drivers, operators and forwarders, the CMR note, is an international consignment note which is specified under the Convention for the Contract of the International Carriage of Goods by Road 1956 (the CMR Convention). Signed in Geneva on 19th May 1956, it is embodied into UK law by the Carriage of Goods by Road Act 1965 (as amended by the Carriage by Air and Road Act 1979).
The CMR Convention governs the responsibilities and liabilities of the parties to a contract for the carriage of goods by road internationally. A CMR document is not a document of title and is therefore non-negotiable.
For UK based exporters, a CMR document would apply only to goods carried by a road vehicle on a roll-on roll-off ferry or via the Channel Tunnel. It does not apply to goods that cross the international border in a container on a ship.
A CMR form is a 4 part document comprising of a:
- sender's copy (red)
- consignee's copy (blue)
- carrier's copy (green)
- administration copy (white with black border)
The carrier usually completes the form, but the consignor is responsible for the accuracy of the information and must sign the form when the goods are collected. The consignee will also sign the form on delivery, which is essential for the carrier as a signed copy is in many cases the carriers’ only confirmation of delivery and means for payment of the haulage charge(s).
T1 and T2 Documents
T1 and T2 documents are transit documents. There are 2 systems that allow the movement of goods within the European wide system, these are;
- The Community Transit System (CT)
- The New Computerised Transit System (NCTS)
A brief overview is:
Community / Common Transit Procedure (CTP) – T1, T2 with NCTS
The aim of the Community / Common Transit Procedure (CTP) is the transfer of customs clearance from the EU’s external borders to the customs offices domestically inside or transit transports of goods without duty paid to the destination customs office outside. (New computerized transit system) NCTS.
A distinction is made here between T1 and T2 (with NCTS):
T1 - (= non-EU-character) means non-Community goods, however, in the EU to the destination customs office / an authorized consignee to be transported.
T2 - relates to Community goods (= EU-character) which are to be transported in non-EU countries on the European continent with the CTP connected countries to the destination customs office / authorised consignee.
Source and further information can be found at the link below.
The Community Transit System (CT) allows goods that are not in free circulation in the European Community (non-Community goods) to move between two points within the Community without being subject to import duties and other charges.
The New Computerised Transit System (NCTS) is a European wide system, based upon electronic declaration and processing, designed to provide better management and control of CT. It involves all EU Member States and the EFTA countries.
Each country's own NCTS processing system is connected through a central domain in Brussels to all of the other countries. Since NCTS mandated this on 1 July 2005 paper transit documents are only accepted from private travellers (with goods in excess of allowances) and during New Computerised Transit System fall-back.
An example of how the electronic system works is as follows;
A truck is loaded for Italy today and a T1 document is issued by Transit. Immediately after preparing the electronic T1 document the clearing office in Italy will receive the message containing details of the goods. If no confirmation message has been returned by the Italian office within 3 days, it will be necessary to investigate the status of the truck.
This electronic system is far more efficient than the previous method of paperwork being carried by drivers. It also reduces the risk of paperwork getting lost and documents not clearing, which reduces the risk of fines/penalties issued for non-clearance.
ATA Carnet (Admission Temporaire or Temporary Admission)
The ATA Carnet is an international customs document that is presented to customs each time goods enter or leave a country. It allows goods to be temporarily imported without payment of customs charges for up to one year and can cover one or more different types of goods. This temporary goods passport is used in 87 countries.
The benefit of using an ATA Carnet is the legal free movement of goods across frontiers and covers their temporary admission into a country with relief from customs duties, excise duty and VAT.
Using a carnet;
- avoids the need to complete national customs declarations or to provide fresh security for customs charges potentially due in each country visited;
- simplifies customs clearance of goods in each country visited;
- can be used in different countries around the world; and
- can help overcome problems that may otherwise result from language barriers and having to complete unfamiliar customs forms
An ATA Carnet can be used by private travellers or businesses. When a carnet is issued, the person who can use it will be named on the front cover of the carnet, this person is the 'holder'. The carnet can be used by the holder or a representative named on the carnet. The holder does not have to own the goods but does accept liability for any customs duty and other charges that may be incurred.
Responsibilities of the carnet holder are to ensure;
- the country into which the goods are going to be imported accepts ATA Carnets for the goods concerned; and
- that the carnet is presented to customs for endorsement each time the goods enter or leave a country
TIR Carnet (Transports Internationaux Routiers)
A TIR Carnet is used to move goods, essentially by road, between two Contracting Parties to the TIR Convention or between two points in a participating country as long as the movement passes through a third country. The payment of duties and other charges are suspended. For the purposes of TIR, the Community is regarded as a single territory. TIR is only permitted in the EU when the movement either begins, ends or transits a third country.
TIR stands for 'Transport Internationale Routiers' which in English means International Road Transport. It is an international transit system allowing goods to travel across one or more international borders with the minimum of customs involvement. At the beginning of 2010, the TIR System had 68 Contracting Parties (including the European Union) on four continents. Many more countries in Africa, Asia, the Middle East and South America have demonstrated their interest in acceding to the system in the near future.
In order to ensure that goods may travel with a minimum intervention en route and yet offer maximum safeguards for customs administrations in all countries of transit, the TIR regime contains five basic requirements or principles. These principles are;
- The goods should travel insecure vehicles or containers (Secure vehicles or containers);
- Throughout the journey, duties and taxes at risk must be covered by an internationally valid guarantee administered through national guarantee associations. The UK has approved two associations, the Freight Transport Association (FTA) and the Road Haulage Association (RHA) (International guarantee);
- The goods should be accompanied by an internationally recognised document, the TIR Carnet. This is taken into use in the country of departure and serves as the Customs control document in the countries of departure, transit and destination (TIR Carnet);
- Customs control measures taken in the country of departure should be accepted by the countries of transit and destination (Mutual recognition of customs controls);
- Access to the TIR procedure for national associations to issue TIR Carnets and for natural and legal persons to utilise TIR Carnets should be authorised by competent national authorities (Controlled access).
The laws on which the above is based are contained within;
- the TIR Convention 1975;
- Council Regulation (EEC) No 2913/92 and Commission Regulation (EEC) No 2454/93; and The Customs and Excise Management Act 1979.
International Road Transport Union
The International Road Transport Union (IRU), TIR Electronic Pre-Declaration (EPD) application allows TIR Carnet Holders to comply, free of charge, with the EU NCTS/TIR and Economic Operators Registration and Identification number (EORI) Regulations which entered into force in 2009, as well as with the new EU security requirements, which entered into force on 1 January 2011, by submitting TIR EPD applications to customs offices of entry/departure in a simple, standardised way. The IRU TIR-EPD is also fully compliant with the World Customs Organisation's Framework of Standards.
The Air Waybill is a document of carriage that is issued by airlines to shippers of cargo. Its conditions are issued under the Warsaw Convention, which was signed in Warsaw on 12th October 1929. This was amended at The Hague (Netherlands) on 28th September 1955 and was further amended by the Montreal Convention at Montreal on 28th May 1999 effectively unifying certain rules from the latter.
An air waybill is not a document of title. The document often travels forward with the goods allowing the immediate release of the goods into the consignee's charge for subsequent customs clearance and delivery.
The following conditions of contract and notices are to be included on every Air Waybill:
Notice appearing on the face of an Air Waybill
It is agreed that the goods described herein are accepted in apparent good order and condition (except as noted) for carriage SUBJECT TO THE CONDITIONS OF CONTRACT ON THE REVERSE HEREOF. ALL GOODS MAY BE CARRIED BY ANY OTHER MEANS INCLUDING ROAD OR ANY OTHER CARRIER UNLESS SPECIFIC CONTRARY INSTRUCTIONS ARE GIVEN HEREON BY THE SHIPPER, AND SHIPPER AGREES THAT THE SHIPMENT MAY BE CARRIED VIA INTERMEDIATE STOPPING PLACES WHICH THE CARRIER DEEMS APPROPRIATE. THE SHIPPER'S ATTENTION IS DRAWN TO THE NOTICE CONCERNING CARRIER'S LIMITATION OF LIABILITY.
Shipper may increase such limitation of liability by declaring a higher value for carriage and paying a supplemental charge if required.
Conditions of contract on the reverse of the Air Waybill - (Carrier's Limitation of liability)
If the carriage involves an ultimate destination or stop in a country other than the country of departure, the Warsaw Convention or the Montreal Convention may be applicable and in most cases limit the liability of the Carrier in respect of loss of, damage or delay to cargo. Depending on the applicable regime, and unless a higher value is declared, the liability of the Carrier may be limited to 17 Special Drawing Rights per kilogram or 250 French gold francs per kilogram, converted into national currency under applicable law. Carrier will treat 250 French gold francs to be the conversion equivalent of 17 Special Drawing Rights unless a greater amount is specified in the Carrier's conditions of carriage.
Both the Notice and Conditions of Contract have a bearing on those operators who specialise in air-cargo road transport. Further information relating to Air Waybills can be obtained from the International Air Transport Association (IATA).
The air waybill has several purposes:
- It is evidence of a contract of carriage
- It proves receipt of goods for shipment
- It is a freight bill
The Warsaw Convention requires that the air waybill is completed in at least three parts:
- For the carrier (signed by the consignor)
- For the consignee (signed by the consignor and carrier)
- For the consignor (signed by the carrier)
The basic information to be shown on the air waybill is as follows:
- Shipper's name and address
- Consignee's name and address
- Customs reference/status: the air waybill is an approved skeleton pre-entry document
- Agent's IATA code
- Airport of departure and destination
- First carrier
- Value of goods and currency
- Description of goods, dimensions, commodity code, rate class, chargeable weight and freight rate
- Freight charges (prepaid or payable at destination)
- Ancillary charges are payable.
The IATA Standard Air Waybill is used by all IATA carriers (those belonging to the International Air Transport Association) and it embodies standard conditions associated with those set out in the Warsaw Convention. When issued by an airline, the air waybill carries a unique reference number that commences with a carrier prefix. The air waybill number is the key to tracing the flight details of the consignment in question and must be quoted at all times when information is being requested.
Bill of Lading
Consideration of the bill of lading as a document relating to the contract of carriage between shipper and shipowner, the responsibilities and liabilities of each party, has been set out in Hague-Visby Rules and Carriage of Goods by Sea Act 1971.
There are three essential elements to an ocean bill of lading issued by a shipping line and covering the carriage of goods by sea. These are:
- It is evidence that a contract of carriage exists between the shipper (exporter) and ship owner
- It is a receipt for goods, showing prima facie that they have been received into the charge of a carrier
- It is a document of title which allows the title to the goods to be transferred by endorsement and delivery of the bill of lading. It should be noted that the transfer of title to the goods is not synonymous with a transfer of property. Whoever holds the bill of lading may take delivery of the goods, but the property will pass when buyer and seller intend it should do so under a contract of sale, usually when payment is affected.
Taken together, these three elements show the importance of the bill of lading to commerce over the years. With the bill of lading showing that a contract of carriage exists and that the goods have been received by the carrier, a buyer and his bank are assured that the dispatch of goods according to the contract of sale is underway. Equally an exporter, holding a bill of lading as the title to the goods, may, by choosing when to pass the bill to the buyer, control when the latter takes delivery of the goods. Thus the bill of lading becomes an essential element in controlling payment procedures in international trade.
A number of different types of bills of lading are available to exporters, according to the type of service being used. Furthermore, a number of different clauses are applicable to bills of lading and these are considered under 'Clean bills and claused bills', following the details which must be shown in the bill of lading.
The following links provide guidance and further information:
CMR Convention - CMR Convention - UNITED NATIONS
London Chamber of Commerce - https://www.londonchamber.co.uk/
HMRC - https://www.gov.uk/government/organisations/hm-revenue-customs
EU Commission - https://ec.europa.eu/unitedkingdom/index_en.html
World Trade Organisation - https://www.wto.org/
International Chamber of Commerce - https://iccwbo.org/
International Road Transport Union (IRU) - TIR-EPD application