INCOTERMS: UNDERSTANDING SHIPPING TERMS IN NIGERIA

Incoterms? The term shipping used in international logistic trade means transport of goods from one place to another. Like every other trade, this movement of cargo from one country to another comes with its on jargon or languages. These are often called shipping terms or Incoterms (International commercial terms).

These terms have meanings assigned to them by the International Chamber of Commerce (ICC). So, they have international application, but may vary slightly in semantic and practice among countries. Though, the application vary among country spaces. This article will explain the usage and application of commercial terms Nigerian trading space. Articles like this keep you updated with the usage and application of terms in the import and export business.

INCOTERMS: CONSIGNEE IN NIGERIA

This is the person or company that receives the cargo at the destination of interest. The Consignee must not be the buyer of goods, but can be another entity nominated by the buyer. To stand as a consignee in Nigeria, the entity (person or company) must have a Tax Identification Number (TIN). He must also have presence in the Nigeria Single Window for Trade. This is of high importance because without the TIN and access to the trade window, the entity would be unable to process Form M. Form M is the first official declaration document to initiate the import conventionally.

Read Also: HOW TO PROCESS AND OBTAIN FORM M IN NIGERIA

In an international contract, the consignee has crucial roles to play. The importer should understand what the roles of a consignee are. So, he can decide who is most suited for the consignee role. Vagmon is a foremost Clearance Vendor that understands how things work in international shipping trade. We take ownership of your shipment processes from the onset to help you reduce costs. Reach us via the ‘contact us’ page of this website or give us a ring at +2349075526276.

INCOTERMS: IMPORTER IN NIGERIA

The importer is the actual buyer of goods, i.e. the company or person who owns the cargo. As stated above, the importer need not necessarily present himself as the consignee. The benefit of using someone else may be a subsidiary company or the import clearance vendor is enormous. Let’s say there is an issue around under payment of duty resulting from use of wrong HS Code. Your company remains intact while the issue is being resolved.

INCOTERMS: THE CLEARANCE VENDOR IN NIGERIA

Some countries prefer to say Customs Broker, and others use Customs Clearance Vendor. In Nigeria, they are called Customs Licensed Clearing Agents. These are individuals with the approval and know-how required to mediate with the Customs to release goods to the owner. Some importers arrange with clearance vendors to take ownership of the cargo from the supplier’s warehouse to the point of delivery at the owner’s site. Doing so will not only be cost effective, but will eliminate lots of errors that could hinder speed. Customs house brokers as they are called in America are up to date with paper work and Customs procedures. Consequently, they are in best position to perform wonders for you.

Read Also: HOW TO CLEAR A CONTAINER CHEAP

INCOTERMS: CUSTOMER

In one of my articles, I mentioned that most major shipping companies accept cargoes from customers if the cargo can make for at least one container load. Unless otherwise, the customer is willing to pay for a full container even when the load is less. It may not be cost effective to pay for full container when all you want to ship is cargo less-than-than container load.

To handle such situations are freight Forwarders, who has many customers of your type –with less than container loads. The Forwarder gathers such cargo and consolidates them into full containers, and gets good deals with the shipping companies. This arrangement helps to reduce the cost of transportation on all such customers. A customer in the context therefore, is the entity (person or company) who pays for the services of a freight Forwarder. The customer could be the exporter, the consignee or someone else (depending on whether the arrangement is ex works or FOB or DAT), that takes responsibility for the transportation and handling less-than-container-load cargo.

CONCLUSION:

With this article, we have detailed the explanation and the application of the shipping terms Consignee, Importer, Clearance Vendor and the Customer as used in the Nigerian context. Understanding of these terms will ease the import and export business in Nigeria and beyond.

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