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Cash Against Document

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21 views

Cash Against Document

Uploaded by

habenzeselama26
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Cash against document (CAD), where the importer’s bank

hands over to the importer the documents needed for


the
release of goods from customs against full payment;
• Advance payment, i.e. the importer orders the bank to
pay
the seller via SWIFT transfer prior to shipment or
rendering the
service.
For all methods of payment, the importer needs to have
an account

0 The delinquent list is a register held by the NBE of


account holders whose cheques have been
dishonored repeatedly and whose accounts are closed by
banks.
and the importer must accomplish the
necessary customs formalities. For this, the first step is to
collect the
necessary commercial documents from his/her bank (in
case of L/C
or CAD) or directly from the supplier (in case of advance
payment).

The following documents are necessary for the


preparation of a
customs declaration:13
• Transportation document such as bill of lading, air way
bill or
truck way bill;
• Invoice which describes the value of imported goods;
• Bank document, i.e. L/C, CAD, confirmation of advance
payment/TT;
• Packing list which describes how the goods are packed
during
transport;
• Certificate of origin which describes where the goods
were
originally produced;
• Other documents as required, such as pre-import
permits
issued by regulatory agencies and duty free permits for
investment goods.
With the exception of the other documents, all
documents will be
obtained from the bank and/or the supplier

Customs duty type of tax lived on imported goods ranges


0-35
Excise tax is charged on selective goods such as luxury
goods,
basic goods demand for which is hardly affected by price
changes, goods that are hazardous to health, etc.0-100
Value added tax (VAT) is levied at a flat percentage rate
of 15% on the sum of CIF value, customs duty, and excise
tax.
Surtax of 10% is levied on all goods imported to Ethiopia
with some exceptions, such as fertilizers, petroleum and
lubricants,
the importer or his/her
agent must complete the customs declaration and submit
it, in
hard copy, at the ERCA office of destination together with
the
entire documentation necessary for clearance.
. Green (automatic release
of goods without further checks), Yellow (requiring the
verification
of the declaration only), and Red (requiring the
verification of the
declaration and the physical examination of the imported
goods)
and Blue (automatic release of goods without further
checks at own
premise).cash payment order (C.P.O.)
examination of the declaration includes the verification
of the
correctness of data information, tariff classification,
valuation and
payment of duties and taxes registered and supporting
documents
attached to declaration.
e physical examination of goods is performed to satisfy
that the
origin, country of export, nature, condition, quality,
quantity, tariff
classification and value of the goods are in accordance
with the
information furnished in the goods declaration.
present the final import customs declaration to the NBE.
This is a
requirement for importing (or exporting) goods in the
future.
An importer must keep all records and documents
related to the
import for five years from the date of ERCA’s acceptance
of the
goods declaration. During this period, ERCA may perform
a post
clearance audit of the import. The purpose of such
audits, which
may cover traders’ commercial data, business systems,
records and
books, is to verify the accuracy and authenticity of
declarations and
information provided by the importer
Transshipment means the customs procedure under
which goods
are transferred under customs control from the
importing means of
transport to the exporting means of transport within the
area of one
customs port, which is the port of both importation and
exportation.
No duties and taxes are paid on goods being
transshipped.
However, a goods declaration has to be submitted. Any
commercial
or transport document setting out clearly the necessary
particulars
can be accepted as the goods declaration for a
transshipment
operation

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