Invoice is a commercial instrument issued by a seller to a buyer. It identifies both the trading parties and lists, describes, and quantifies the items sold, shows the date of shipment and mode of transport, prices and discounts (if any), and delivery and payment terms. A commercial invoice must also include a statement certifying that the invoice is true, and a signature. And there is no standard format, as long as document included specific information such as above.
The commercial invoice is essentially a bill (i.e. invoice) from the seller (the exporter) to the buyer (the importer) describing the parties to the agreement, the goods to be sold, and the terms involved, as agreed between the exporter and importer. As such, the commercial invoice is the final bill exchanged between the seller and the buyer. The commercial invoice will normally be presented on the exporter's letterhead and will be addressed to the importer. It should contain full details of the consignment, including price and other related costs, in order to facilitate customs clearance. It must also be signed and dated. Freight and insurance, when included in the selling price, should be itemised separately as these charges are not subject to duty in certain countries. It is important that the commercial invoice clearly differentiates between the dutiable component of the order (the market value of the order), any other typically non-dutiable charges such as freight and insurance, and the total invoice value of the order.
What should appear in the commercial invoice
The following details should appear in the commercial invoice:
The document title should clearly state "invoice or Commercial Invoice"
The name of the exporter (referred to as the shipper) and their contact details (tel, fax, cell, e-mail), including physical (not postal) address
The name of the importer (referred to as the consignee, meaning the person or firm to whom the goods are to be sent) and their contact details (tel, fax, cell, e-mail), including physical (not postal) address (In the case of transshipment, there may be an intermediate consignee and their contact details and address should then also be included on the invoice.)
If the person or firm buying the goods (the importer) is not the same as the person or firm to whom the goods are being sent, then you should include both their contact details and addresses in the commercial invoice
The name of the person and company to notify once shipment has taken place and their contact details and physical address (here the contact details such as telephone, fax and cell number and e-mail address are more important than the physical address)
A commercial invoice reference number
A purchase order number or similar reference to correspondence between the supplier and importer
The date of issue of the commercial invoice
A complete, detailed and clear description of the goods in question, incorporating the appropriate HS codes and brandmarks if applicable (here the importer may ask you to remove these codes as they may not be the same in the importing country and may thus incur additional or higher duties to the importer's detriment because of their inadvertent misuse)
The quantity of goods in question, including the number of units/items
The packing details unless provided in a separate packing list, including their external dimensions, cubic capacity, weight, numbers and contents of each package shipped, and kinds of packaging involved (pallets, boxes, bags, etc.) - if a separate packing
list is used, reference should be made in the commercial invoice to the packing list
The grand total price of the goods for the whole consignment
Where applicable, the unit prices should be indicated - the unit price multipled by the number of units/items should be reflected in the line total. The various line totals (in the case where different items are included in the same commercial invoice, or where additional services are itemised in the invoice), should add up to the total price for the whole consignment (also referred to as the 'Grand Total')
The currency in which the goods will be sold (e.g. US dollars or rands)
The type and amount of any discount given, where applicable
The likely delivery schedule and delivery terms
The payment methods (for example cash in advance, documentary collection, L/C, etc.)
The payment terms (for example 30 days on sight)
The Incoterm to be used (Incoterms 2000 - FAS, CIF, CFR, DDP, etc.)
Who is responsible for the banking fees and other related costs (insurance and freight costs are covered by the incoterm in question)
1. What the freight and insurance charges are
2. The exporter's banking details
3. A declaration of the country of origin of the goods
4. The expected country of final destination
5. Any freight details such as the port of loading and discharge
6. Any additional exporter-provided services that should be added to the invoice to come to the grand total
7. Any transhipment requirements
8. The validity of the commercial invoice - that is, when does the offer expire (leaving it open-ended could be very risky)
9. Any other information relevant to the order
10. Make sure the commercial invoice is signed, together with the signature's name written underneath, with initials, title and position
