Page 31 - PowerPoint Presentation

INTERNATIONAL TRADE-CHANGING

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• it is a conclusive receipt, i.e. an acknowledgement that the goods have
been loaded; and

• it contains or evidences the terms of the contract of carriage; and
• it serves as a document of title to the goods.
The challenge is the shipping industry is still doing business or operating in

its own fashion and a long way to go to cope up with the automation. That
means, if you want to automate your invoicing process and send the invoice
and other document electronically to your customer, as the BL document is
still issued in its physical form and with signature, you may still need to
dispatch the hardcopy of BL document alone to your customer by courier or

postal service.
Taxation- Royalty, Online subscriptions and Service of Consultants:
Many countries have Tax Deduction at Source provisions, or withholding

tax provisions in their Direct Taxation (Income Tax ) laws. These provisions
requires the service receiving company or the company who makes payment
to non-resident vendors, to deduct certain percentage of payment as tax and
remit to Government. In case a Double Taxation Agreements exists, these
non-resident vendors can claim set offs or refunds, subject to some

formalities. There can be many challenges to determine whether the type of
service (for example online subscriptions, e-commerce, service of
consultants etc.) is provided in the country or outside the country.

Sanctions
These days any customer, vendor or country itself may hit by sanctions as a

surprise for so many reasons. This might cause great impact on your business.
Your risk mitigation tools should have considered and covered all these
aspects. Before selecting your customers and vendors you must have done
your due diligence and homework thoroughly to ensure that the counterparty

and its directors are not on any black list and have good trustworthy track
record. There are many technological tools available these days to have more
access to publicly available information. Also it is worth to have a look at
your contracts on the flexibility to shift the transaction currency to another in

case of any emergencies.

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