Payment procedures in Triangular exports Posted on 01 June 2022 Category : Export The information provided here is part of Export Import Online Tutorial Before reading this article, I suggest my readers to go through all other articles related to triangular trade which make you more clear about the procedures and formalities of triangle trade. In a triangular exports and imports, if A obtains order from B and transfers export order to C who is final supplier, the terms of contract between parties each other can be explained below with two levels. Level 1. Transactions between A & B Level 2. Transactions between A & C In the example level 1 above, A acts as seller of goods and B acts as buyer of goods. A delivers goods to B by sourcing goods from C. On maturity of payment agreement each other between A and B at the time of placing order, B pays the agreed amount to A against his invoices. In other words, the foreign exchange is transferred from B’s country to A’s country. In the example level 2 above, A acts as a buyer of goods and C as seller. C ships goods to B’s place, but invoice to A. On maturity date of agreement on payment between A and C, C receives payment from A as per their agreed terms. In this case, the foreign exchange is transferred from A’s country to C’s country. Also read - Documentation for triangular shipment Triangular export Bill of Lading procedures in triangular shipment What is switch Bill of Lading? Procedures and documentation on Triangular shipments How to protect parties each other in triangular exports Switching documents in triangular Exports and imports Did you like this article. Please discuss. The above information is a part of Import Export Training online Other details on how to import export How to protect parties each other in triangular exports Switching documents in triangular Exports and imports Procedures and documentation on Triangular shipments Documents required for import clearance under high sea sale Difference between Purchase Order and Commercial Invoice Consignee in Invoice ‘To Order’ Excise and Customs - Click here to read complete notification under Budget 2014 How to get Export Orders? How to settle dispute in Exports and Imports? Click here to know India Trade Classification(ITC) Pre shipment bank finance to suppliers for exports through other agencies Types of export containers Measurement of export containers Export Import Policy of India 2015-20 MEIS, Merchandise Exports from India Scheme SEIS, Service Exports from India Scheme Merge your Commercial Invoice and Packing List for all your future exports Export procedures and documentation How to amend number of packages in Import General Manifest (IGM) How to amend quantity of goods in Import General Manifest (IGM) How to amend shipper name in Import General Manifest (IGM) How to amend spelling error in IGM. in India How to avoid delay in receiving OBL Original Bill of Lading? How to avoid two import DO charges at destination Transferability of Bill of Lading Transhipment - A redefinition Travelers to India under import duty exemption, Frequently Asked Questions Part 2 Triangular export Types of Insurance Documents. What is LC Letter of Credit in export import business What is legalization of documents by embassy? What is LET EXPORT order in export trade? How to book empty container for factory/CFS/ICD/port stuffing How to calculate CBM in LCL export shipments: How to calculate chargeable weight under airfreight in exports? How to check the time of contract on high sea sale transaction? How to Choose a product for export business How to cover the risk of Cargo loss or damage How to customs clear Cargo arrived in a port where in import license obtained for another port How to differentiate BL and HBL? How to differentiate CPT and DAP in shipping terms How to divert cargo from one port to another? How to file bill of entry Manually. What is manual filing of Import Documents? How to file Bill of Entry on line? What is called Noting in bill of entry How to get exemption of Sales Tax under exports. What happens if overseas buyer not paid export bills discounted. What happens if proper tracking of goods not effected in export import business? What happens if your buyer rejects cargo? What are the major problems if consignee not taken delivery of cargo? How to get export order from foreign buyers? How to get RCMC from Export Promotion Councils How to hide invoice value of original contract under high sea sale transactions How to know the quality, quantity or contents of goods before import customs clearance How to know volume of LCL cargo if not measured at factory Transferability of Bill of Lading Transhipment - A redefinition Travelers to India under import duty exemption, Frequently Asked Questions Part 2 Triangular export Types of Insurance Documents. How to make DA mode of payment safe How to make delay in delivery of Shipment? How to minimize import cargo clearance time? An open logic proposal to WTO How to obtain a duplicate BL, if original bill of lading lost. How to obtain GSP - Certificate of Origin? How to obtain Phyto sanitary certificate. What is phytosanitary certification How to obtain waiver on detention/ demurrage on imported goods/container from Shipping company/CFS How to open an LC? Procedures to open a Letter of Credit Comments Nikos Giannakakos: On 18 April 2016 I am about to set up a company in Dubai selling fashion products and accessories to USA. My company will act as a distributor co-operating with designers from Greece (at least initially). I am puzzled with the process for collecting and delivering the products from Greece (multiple locations) to USA (multiple locations). I have read that such transaction a.k.a triangle import/export.I would like if you can help me with the following: 1) First of all is it possible the Dubai company order from Greece and deliver to USA customers (retail shops) 2) What kind of documentation is required (invoices, pick-up list, certification of origin, etc.). 3) Are there any taxes/duty fees or other fees at the Greek customs for exportingg the products. How are these handled? 4) Are there any taxes/duty fees or other fees at the USA customs for importing. How are the handled? 5) Are there any barriers that I should know in advance that might postpone export of products from Greek customs or import of products from USA customs? sriram: On 28 April 2016 thanks for giving the overview about triangular trade. Just have a question, in a situation where A from India despatches goods to C in say Thailand against COO certificate against despatch instruction from B in say USA. What is the value which needs to be captured in documents. For example, let us assume A cost plus margin is Rs.108 and B, USA invoices to C in Thailand at 120/. In this situation what values to be mentioned in COO, Shipping Bill, in India. Can we take 120 as the FOB value of exports? Rajesh Handa: On 30 September 2019 Do we need form 15CA & 15 CB for payment transfer to supplier? Should we enter this sale in GST portal? Baroda qpt: On 01 September 2021 We are a heavy engineering manufacturing company in business since 2009. A substantial part of our sales comes from direct exports of our products as a ‘manufacturer-exporter’. We have a situation as follows: We supplied some equipment to an End User in Country A, against an order received from our customer in Country B. Now we have to supply some spares free of cost under warranty obligation. These spares are not made in India, they are proprietary items to be ordered on a supplier in Country C. If we bring them into India first, we will incur customs duty in India, then re-export to Country then re-export to end user in Country A, We placed an order on supplier in Country C, asked him to deliver direct to end user in Country A. We have to make payment to supplier now. We will not have any bill of entry for the goods in India. How do we make payment without violating FEMA? How do we close the loop? kumareshan: On 16 June 2022 Your website is great and thanks for sharing knowledge. I have a question in triangular shipment. Shipper - ABC India Buyer - ABC Korea ( Head Quarter of Indian Forwarding agent) Consignee/goods final receiver - ABC Indonesia. Forwarding Agent - India ( Buyer - ABC Korea is our Forwarding Head Quarter) I'm the Forwarding agent at INDIA, have to issue HBL, shipper as Buyer - ABC Korea ( is it allowed, if not allowed, I need to know the problems behind it.) My Head quarter( Buyer - ABC Korea) order India to issue to issue HBL with ABC Korea address in shipper column instead of switching at Korea. Pls assist me as soon as possible, your knowledge is highly appreciated. If any clarification pls let me know. mohit: On 29 June 2022 I am Mohit from Alair International, our company is in the business of trading of hydrocarbon products. We would like to discuss with you about our proposed triangulated merchant business and related shipping related queries. May I request you to kindly let me know a suitable time. pramod: On 01 July 2022 I have received an export order from a Dubai Firm in USD and they want us to ship the material to Mauritania Client who is the end user. I require some inputs from you on the same. Can you share your contact number pls ? ziad: On 16 July 2022 You have a very good informative site. I need specific information regarding a triangular shipment / export process for online orders. I'm starting a hand made soap business whereby I will sell in India through retail and internationally through distributors. At the same time, my daughter who resides in Canada wants to set up an online store in Canada and take orders internationally. Once a customer, e.g. in Switzerland places an order on her site, she will pass it on to us for shipment directly to the customer in Switzerland. We need to invoice daughter the price we have agreed for her, e.g. Rs. 80/bar. My daughter will sell to her customer at Rs. 120/bar, for which an invoice needs to accompany the shipment to Switzerland. How would we go about doing that? I wanted to talk to you directly but could not find a number anywhere on your site. If you don't mind, I would be grateful if you could send me a number to call you.