The export process step by step: documents, customs and collection

The three decisions that shape the process

The rest of an export depends on three decisions taken at the very start:

1. The Incoterms term — where cost and risk change hands, and who handles customs procedures
2. The payment method — advance payment, cash against goods, cash against documents, or a letter of credit
3. The need for a certificate of origin — whether the buyer will use a preferential regime

Any step taken before these three are settled requires correction later.

Step by step

1. Contract and offer. The Incoterms term, payment method, delivery date and document list are put in writing.

2. Proforma invoice. This is the basis if the buyer needs to obtain an import licence or open a letter of credit. The goods description on the proforma must match the commercial invoice issued later.

3. Production and packaging. Packaging is chosen according to the mode of transport. Export packaging differs from packaging for the domestic market; the number of handling operations and the duration are longer.

4. Arranging transport. A booking is opened, and the loading date and cut-off are obtained. If there is a letter of credit, its consistency with the latest shipment date is checked.

5. Invoice and packing list. Goods description, GTİP (tariff code), quantity, weight and dimensions are recorded. This information must be identical across all documents.

6. Product documents. Product-specific paperwork such as health certificates, analysis reports and conformity certificates is prepared. Their validity periods are checked.

7. Exporters’-association approval. As a rule, this is obtained before the declaration is registered. There are exceptions.

8. Registering the declaration. The customs declaration is submitted and registered. The lane assignment is made at this point.

9. Loading and the transport document. A bill of lading, CMR or AWB is issued. The information on the document must be consistent with the invoice.

10. Certificate of origin and movement certificate. An A.TR, EUR.1 or certificate of origin is issued and endorsed.

11. Sending the documents and collection. Depending on the payment method, the documents go either directly to the buyer or to the bank. The declaration is closed.

The VAT exemption and the declaration

Export deliveries are exempt from VAT. To benefit from the exemption, however, the export must be documented with a customs declaration.

The practical consequence of this is tied to the choice of Incoterms. Under an arrangement such as EXW, where the export declaration belongs to the buyer, the declaration may not show you as the exporter. In that case, the exemption and refund process is put at risk. This is one of the reasons FCA is recommended over EXW for international sales.

Export-registered sale (İhraç kayıtlı satış) is a separate mechanism: a manufacturer sells to the exporter without collecting VAT, on condition that the export takes place within the required period.

Document consistency in a letter-of-credit transaction

In a letter of credit, the bank looks not at the goods but at the documents. A document that does not conform to the terms creates a discrepancy; the bank can refuse payment, and payment then depends on the applicant accepting the discrepancy.

The most common discrepancies: the goods description not matching the letter of credit, the latest shipment date being exceeded, the presentation period being missed, and items missing from the document list.

The solution is simple but requires discipline: the text of the letter of credit is read before loading. Terms that cannot be corrected once the goods have left are still changeable at that stage.

Common mistakes

Choosing Incoterms out of habit. For containerised loads, FCA should be used instead of FOB, and CIP instead of CIF.

Leaving the certificate of origin until later. Retrospective issuance is an exceptional route and is not always accepted.

Writing different goods descriptions across documents. The description on the invoice, packing list, transport document and certificate of origin must match one another.

Reading the letter-of-credit terms after loading. This is the most costly mistake.