8 tips for organising your processed fruit and vegetables export to Europe
Finding a buyer who is satisfied with your offer is only half the battle when entering the European market. You still need to agree on delivery terms, sign a contract, pack your goods, arrange the required product and shipment documentation, organise transport to Europe and get paid. Although this may look like technical and easy work, it comes with many of its own challenges. The tips listed below give you short but practical information on how to deal with those challenges and on how to become an efficient, trustworthy and successful exporter of processed fruit and vegetables.
Contents of this page
- Trust is important, but always make sure to secure your payment
- Do not take risks - insure your export and increase competitiveness
- Include customs procedures in your cost and time calculation
- Select the best transport and logistics options
- Ensure safe and cost-effective packaging
- Make detailed contracts
- Make a checklist of all your export documents and regularly review it
- Use assistance of support organisations when organising your export to Europe
1. Trust is important, but always make sure to secure your payment
Selecting the most suitable method of payment is a key factor in successful export sales. Whichever payment method you select, you should always sign a contract of sale before performing any international transaction. Basically, all methods of payment can be classified as either “clean” or “documentary”. In clean payments there are no extra security measures for advanced payment. In documentary payments, a different level of security is achieved by using banking systems and specific accompanying documents. The following methods of payment are used:
- Payment by cheque - this is the most insecure method of payment in international trade. You should avoid it. The main problem is that your bank can refuse to accept the check. Also, when sending the cheque through the international banking system, fees can mount up significantly, making this method very expensive and slow.
- Payment by bank draft – this is a physical document. It is hardly used anymore. It has been replaced by electronic bank transfer.
- Clean bank transfer – this is a well-known method. The importer pays you, using a banking system, commonly through SWIFT (Society for Worldwide Interbank Financial Telecommunication). It is a safe method only in the case of advance payment (when you get paid before shipping the goods).
- Clean collections – this involves sending financial documents such as bills of exchange or promissory notes through the banking system in order to collect payment from the importer. You should use this method only after establishing a certain level of trust with your buyer, because you can lose control over the goods before getting paid.
- Documentary collections – this method guarantees physical control of the goods before you get paid. Documents (such as invoices, shipping documents, insurance and the like) are transferred through the banking system. Importers can access the documents only when they comply with the instructions you sent to the collecting bank (Documents against Payment or Documents against Acceptance). This method guarantees physical control of the goods, but it does not guarantee that you will actually get paid in the end. If the importer does not pay you, you can return or store the products. Of course, this is not an ideal situation.
- Letter of credit - Other than payment in advance, a Letter of Credit is considered the most secure method of payment for you. In this process, the buyer’s bank will only make the payment when the presentation of documents complies with the Letter of Credit conditions. For extra security, the seller can request the advising bank or another bank to confirm the Letter of Credit. In that case, the importer will get the goods only after payment. This is also a good way of checking the financial standing of the buyer, as the issuing bank will do a credit adequacy test before opening a Letter of Credit on behalf of the buyer.
Usually, long-term relationships are based on trust. Commonly, when making the first export shipments, you will require advanced payment and gradually move from the Letter of Credit, through documentary collections towards clean bank transfers. If you do not know your buyer, you should always insist on either advanced payment (to be paid before sending the goods) or a Letter of Credit.
The main disadvantage of a Letter of Credit is that it can be costly. To overcome this problem, you can offer the buyer to split the fees. For example, you can pay fees from your bank while the importer can pay fees to their (issuing) bank. Another problem faced by some developing countries is that their banking sector does not offer the possibility of using a “Letter of Credit”. You need correspondent banks for this process and some developing countries do not have them yet.
When trading with European buyers, you will sometimes come across importers pressuring you to use deferred payment. You can accept this condition if you use export insurance services. However, in order to protect suppliers from this (frequent) practice, the European Commission proposed a new directive to protect small and medium-sized suppliers in the food supply chain. This directive aims to protect farmers, processors, distributors, producer organisations as well as suppliers from outside the European Union.
- Ask advice from the Chamber of Commerce to better understand the methods of payments. You can also purchase several guides and practical documents on trade finance from the International Chamber of Commerce (ICC). Alternatively, you can take part in ICC online training or Export Academy’s online training on trade finance.
- Check with your bank about the actual costs and procedures of a Letter of Credit. Although the Letter of Credit process may seem complicated, in reality the majority of activities are performed by banks and not directly by you. You would just need to follow instructions given by the banks and make sure that documents are correct.
- Select a bank that is recognised in Europe and that has daily experience in dealing with Letters of Credit. Ideally your bank and the bank of your buyer should be part of the subsidiary network of the same bank.
- Establish a clear set of Letter of Credit Instructions tailored to your business model and send it to your potential buyers before signing a contract. This will speed up the time of opening a Letter of Credit for buyers. It will also refer you from adding unnecessary terms and conditions.
- Use the support of Trade Facilitation Programs by international development banks. Examples are the EBRD Trade Finance Program or the IFC Global Trade Finance Program or the Asian Development Bank’s Trade Finance Program. Those programmes offer guarantees to cover the costs of transactions. You can access this network through selected local banks in your country. These banks have to be members of those particular programs.
2. Do not take risks - insure your export and increase competitiveness
Export involves a lot of different risks such as payment, risk of damage and theft, currency fluctuations, political risks (such as a ban on the import of specific products) and the like. Therefore, it is recommended to ensure your payment and your goods, especially if the contract involves larger volumes and values.
For the export of processed fruit and vegetables, export credit insurance is among the most common insurances. One particular advantage of export credit insurance is that it does not only secure your export but also increases your competitiveness. As many European buyers ask for deferred payment, export insurance services can ensure you actually receive your payment. Being able to offer deferred payment can greatly increase your competitiveness.
Export credit agencies (ECAs) are responsible for the insurance. There are many of them with an international network of offices. They are often privately owned, but they can also be governmentally owned. Some ECAs are established by governments in order to increase general competitiveness of their country’s exports. You should search for one in your country.
If you want to offer deferred payment to some potential buyers, you can ask selected ECAs for support. This is usually done in the following way:
- You submit the request for credit insurance with the necessary documents to an ECA
- The ECA sends an indicative offer to you
- If you agree with the indicative offer, the ECA orders credit reports for all buyers that you would like to offer deferred payment terms to
- The responsible department at AOFI analyses the buyers’ creditworthiness and sets the credit limits
- The ECA delivers the final offer to you, after which, if you accept, the insurance policy is signed.
The added value of this procedure is that you also learn a lot about your buyers and gain insight into their solvency and creditworthiness. For processed fruit and vegetables, due to nature itself and the seasonal nature of the goods, a short-term insurance (repayment period up to one year) is recommended.
The ECA will give details of the risks covered by the policy, which is normally related to events of non-payment by the buyer. An important thing to note is that they will not pay out under disputes between buyer and seller, until the dispute is settled in the seller’s favour. Trade credit insurance only provides protection for bankruptcy of the obligor. Also, becoming insolvent can be very different than “failure to pay”.
Aside from insuring the payment, you can also insure your products. A shipment insurance is used to protect your shipment of products throughout the entire journey from you to your customer. The risks that are covered typically include theft, damage due to heavy weather, damage due to problems with a vessel and the like. You and the importer will have to agree on who is responsible for the insurance and this is specified in the Incoterms (technically required only under CIP/CIF terms). You are advised to agree this type of insurance with your buyer. In this type of insurance, two types of documents are used: an Insurance Policy and a Certificate of Insurance.
Other types of insurances provided by an ECA include the issue of guarantees (for companies willing to apply to international tenders) and short-term financing or factoring.
- Find reliable export credit agencies and companies, which are part of a larger network, to insure your shipments. One of the best places to search is the list of members of the Berne Union.
- Ask export credit agencies to give you an offer for the solvency report of your targeted buyers. This will not give you payment guarantees, but you will have a clearer picture of the company you want to make a deal with. In some countries, basic data (such as annual turnover and basic balance sheets) are available free of charge. By having more insights, you may decide to work with some clients without credit insurance.
- Read more about insurance covering risks related to export credit agencies.
- Ask for advice from experienced exporters about particularities of working with export credit agencies.
3. Include customs procedures in your cost and time calculation
Importers, agents or customs brokers are responsible for taking the processed fruit and vegetables through European customs. Although you, as the exporter, are not usually directly involved in this process, it is extremely important to be in touch with the transporter and importer and provide all necessary documents and further support. Only in cases when the exporter uses “delivery duty paid” (DDP) will full customs clearance be the exporter’s responsibility. In most cases it is not recommendable to use DDP, because customs clearance is rather complex for non-European companies. It is also not that common to use DDP
Generally, customs procedures follow these three steps:
- Customs pre-alert: processed fruit and vegetables entering the European Union must be “pre-alerted”. This pre-alert is submitted electronically, normally by the carrier or freight forwarder carrying the goods. This is usually done between 2 and 24 hours before the arrival of the goods.
- Inspection and control: this step involves a documentation check and the physical examination of goods, often in collaboration with the national (customs and food safety) authorities.
- Customs decides about further action: accept the goods for free trade within the European Union, allow movement into the free zone, allow re-export outside of the European Union, destroy the goods or refuse the goods.
When processed fruit and vegetables arrive in the European Union, they are inspected and checked by customs authorities. Apart from examining the export documents, examination can involve taking samples for analysis in the customs laboratory. In case of non-compliance with the European Union food safety rules, the product will be rejected, and in some cases, customs authorities may require the physical destruction of the goods.
Rejection of the goods may mean a great profit loss for the developing country exporter. Therefore, it is extremely important to properly check your processed fruit and vegetables before exporting them, and this includes having them tested in a laboratory. To find more about specific tests or requirements that are relevant for processed fruit and vegetables, read our study about buyer requirements.
Another important aspect related to customs is the proof of origin of goods. Most processed fruit and vegetables imported from developing countries are imported with lower customs duty or duty free. This is because within the European Union the Generalised System of Preferences (GSP) is guaranteed to developing countries. In addition to GSP, the European Union has a number of specific free trade agreements with different developing countries. In more than 90% of the cases concerning processed fruit and vegetables, imports from developing countries are duty free.
- Read the Guidance Document on Customs Formalities on Entry and Import (pdf) into the European Union to become familiar with the Union Customs Code.
- Use the Market Access Map to analyse potential competitive advantages based on applied tariffs for your country and other countries. You can learn how to use “compare” and other functions from instructional MacMap videos.
- Check possible additional costs if your country is on the list of stricter import conditions for specific products. Those usually include obligatory payments for specific laboratory tests for a certain percentage of shipments. For example, if 50% of exported peanuts must be border controlled, in practice, samples of every second container (or track) from a specified country are taken for analysis. Those laboratory costs are usually paid by the exporter.
- Consult your freight forwarder or customs agent about export documents and customs procedures issues. You can search for the agent on the website of the International Forwarding Association. Also, you can search for national associations through the website of the European Association for Forwarding, Transport, Logistics and Customs Services. Alternatively, you can search for the relevant association in your country through the International Federation of Freight Forwarders Associations website.
4. Select the best transport and logistics options
For processed fruit and vegetables, transport is of extreme importance as it keeps the products in the right condition (for example frozen products), it influences your image (for example late delivery can result in the loss of a client) and it influences the price (20-40% of the sales price can be logistic costs).
More than 90% of processed fruit and vegetables are imported into the European Union from developing countries via marine transport. However, in some cases (for example imports of frozen berries from eastern European countries), road transport is used too. In rare cases of smaller volumes but high prices, air transport is used as well. Examples of air transport include the transport of medical mushrooms (such as cordyceps or reishi) and powdered products such as maca (Peru), cordyceps (China) or ashwagandha (India).
Before you start loading the container, check if it is clean, waterproof (without holes) and well-painted (without rust on the inside). When loading the container, consider using moisture absorbing products like special (food-proof) gel bags. Those gel bags absorb condensation moisture caused by temperature fluctuations during transport. This decreases the risk of moisture damage and aflatoxins.
For overseas transport, the basic movement of the container consists of loading on a train or truck, transport to the port, unloading from the train or truck, inspection and loading onto the ship (stowing). If the quantity of goods is Less than Container Load (LCL), you can use a groupage service, which is offered by many companies. They arrange goods in such a way that the container can be shared by several companies.
The method of transport is also part of the Incoterms and therefore influences your decision about the price and contract you will offer. For example, if you are trading large quantities of goods, you can get better offers from transport and insurance companies. In this case the CIF price (Cost, Insurance and Freight) will usually be more competitive for you. Quoting CIF or CIP also generates more foreign exchange for you. If you have little export experience, it is safer to offer a price based on ExWorks or FOB only.
Transport documents are extremely important for you to check. These valuable documents (such as a Bill of Loading) are issued by the nominated carrier or their agent. Check all details of the transport document and do not accept any “dirty” documents. A transport document is considered “dirty” when transport companies add a notation that they noticed defective packaging, which can cause damage to the goods. Such transport documents do not give any guarantees that you will receive payment for the transaction.
One of the trends regarding transport and logistics, is the development of blockchain technology to reduce the costs of intermediaries. An example that illustrates supply chain complexity is when a simple shipment of refrigerated goods from East Africa to Europe can go through nearly 30 people and organisations, with more than 200 different interactions. Blockchain systems allows each stakeholder in the supply chain to view the progress of goods through the supply chain, monitor the container movement in real-time and see the status of the customs documents.
In addition to tracking the goods, blockchain technology can encrypt important documentation (for example quantities, prices and contracts). This secures the agreements made and gives control in every step of the chain. This means that, if something goes wrong, somebody receives a wrong quantity, a price isn't paid, or an agreement is not fulfilled, it can easily be seen by the blockchain.
- Go to the websites of the Transport Information Service and Container Handbook for information on safe storage and transport of processed fruit and vegetables. You can also find specific advice on how to secure cargo for road transport (pdf) in the European best practice guidelines.
- Check the website of the European Logistics Association (ELA) to network with different operators within Europe. ELA also offers training on different topics, such as logistics, transportation or warehousing. You can also participate in ELA events.
- Use a good freight forwarding company that takes care of most of the process. Take your time when selecting a logistics company. Send your request for proposal to many operators and be as specific with your questions as possible. After you make a short list, make your selection and sign a detailed contract. Your contract needs to involve points such as responsibilities, how damaged goods are dealt with, price changes and compensation.
- Use the shipping company’s Track & Trace facility to follow your container and communicate any delays to your customers pro-actively. This might avoid claims.
- Find the list of quality certified ship agents and brokers on the website of FONASBA.
- Monitor the developments of blockchain application in international transport and logistics from companies such as Maersk, Zim or Accenture.
5. Ensure safe and cost-effective packaging
Optimal export packaging is one of the fundamental aspects in the trade of processed fruit and vegetables. Packaging used for processed fruit and vegetables must:
- Protect the quality characteristics of the product and its look, feel and smell.
- Protect the product from bacteriological and other contamination (including contamination from the packaging material itself).
- Protect the product from moisture loss, dehydration and, where appropriate, leakage.
- Not pass any odour, taste, colour or other foreign characteristics onto the product.
There are many different materials and forms used for export packaging of processed fruit and vegetables. You can find photos of several types of packaging in our product specific studies. Some of the most common options for bulk packaging are the following:
- Dried fruit is often packed in plastic liners placed in carton boxes.
- Shelled nuts are mostly packed into plastic bags. Usually those bags are vacuum-sealed and rectangularly shaped in order to better fit on the pallets and containers.
- Unshelled nuts (such as walnuts, peanuts or hazelnuts) can be packed in jute bags, linen fabric bags or polysack bags. Other materials may include tinplate cans or paper bags.
- Frozen fruit and vegetables are usually packed in polyethylene bags or cardboard boxes lined with foil. Individually quick-frozen products (IQF) are commonly packed into the foil-lined carton boxes while other forms (blocks, crumbles and the like) are often packed into plastic bags.
- Juices and purees are packed in very specific packaging, the most common is “bag-in-a-drum”. For foodservice clients, a similar option is “bag-in-a-box”. New packaging solutions include bulk intermediate containers constructed from steel. Also, in some cases, juices and purees (not aimed for immediate consumption) are transported directly in truck tankers (volumes up to 25 thousand litres).
- Jams and marmalades are packed in glass jars only in cases when they are aimed for direct sales to retail. However, they are often bulk packed in a similar way to purees, using the “bag-in-drum” method.
- Canned and preserved fruit and vegetables are most often packed in aluminium cans. Other types of packaging are also used, such as jars, carboard boxes and pouches. Canned products are the only exception in the processed fruit and vegetables category as they are more often packed in retail containers for international trade. Table olives may be the exception; these are mostly traded in bulk, using plastic barrels.
The European Union has announced the introduction of new legislation concerning plastic packaging, mandating Member States to collect 90% of their plastic throw-away bottles in 2029. Also, some single-use plastics will already be banned from 2021 and the use of other types will be restricted. Items on the banned list include oxo-degradable plastic and expanded polystyrene take-away food and drink containers. By 2030, all bottles in the European Union must be made from at least 30% recycled materials. You must be aware of those requests and adapt to new export packaging materials on time.
Insect infestation during transfer can be prevented by fumigating the product before loading. Fumigation is sometimes used for products such as dried fruit. Please carefully check the fumigant and the dosage, because fumigants can also be a hazard. Ethylene oxide (ETO) treatment has been banned under European legislation. Approved fumigants may be used in accordance with manufacturers' instructions, but this must be indicated on the accompanying documents. In general, European companies support the use of environmentally-friendly fumigants.
Upon completion of packing and labelling, you must prepare a packing list. A packing list is an essential document that is needed for customs procedures. It will be used by carriers, cargo handlers, warehouses and customers. A packing list states the following particulars for each package: marks, numbers, gross weight in kg, net weight in kg, dimensions in cm, volume and content description. This list also gives the total number of packages and the total gross weight and volume. Depending on the product, certain internationally accepted marks are put on the outside of the packaging. A few examples relevant for processed fruit and vegetables are given in Figure 1.
Figure 1: Examples of marks used on the packaging for processed fruit and vegetables
Bear in mind that packed goods must be within the limits of size and weight established by the carrier. The majority of the European traders prefer to use pallets with 1,200x800mm dimensions (Euro Pallets). In order to avoid pallets overturning, you must ensure the cargo is well stabilised. The maximum recommended height of a cargo unit is about 1.7m. However, you should ask your customer for the size limitations of their warehouse. Also, pay attention to the types of forklifts you are using. Electric forklifts are recommended when dealing with food, in order to avoid contamination that might be caused by fuel-powered forklifts.
Aside from its protective properties, size and weight also influence the cost of transport. Packing and handling costs are reflected into the final cost of the product. Fully utilising the container can create significant savings in packaging costs. It is important to emphasise that the time of loading and unloading the containerised goods from a vessel can be reduced by 20-25% if the port has appropriate facilities. Please note that in some European countries labour health and safety legislation allows workers to lift a maximum of up to 20 kg.
- If you are organising you first shipment to Europe, work with an intermediary company that has experience in packaging processed fruit and vegetables for export. Big export companies have staff specialised in packaging techniques. A good packaging specialist can save his company a lot of money if there is a sufficiently large volume of exports.
- Check computer programmes that allow you to calculate and design packaging as well as plan the best arrangement of the goods inside containers and tracks. Examples are: ShipHawk, Logen Solutions, Easy Cargo, packVol and TOPS Pro.
- Check instructions for shipping and storing of different types of processed fruit and vegetables on the website of Transport Information Services.
- Check specific packaging requirements for a variety of products in our product fact sheets for processed fruit and vegetables.
6. Make detailed contracts
Well-defined agreements in contracts will protect your business and give your buyers a sense of reliability and professionalism. Some buyers may be satisfied with only email exchange; however, even if your buyer does not want a contract, it is in your own interest to have one. Contracts or framework agreements act as a reminder and a record of what needs to be done. They also form the basis of legal proceedings, should either the supplier or the buyer breach the agreements. Though not an easy process, contracts can be enforced in Europe.
There are many details that should be included in the contracts, but the main subjects are listed below. Keep in mind that it is in your interest to sign a contract covering the most important aspects of trade. However, in reality many buyers will insist that you accept their general supply conditions and pre-defined contract forms.
- Name and addresses of the parties.
- Product specification (following internationally accepted standards).
- Quantity (units of measure in both figures and in words).
- Total value: specify the currency. State both the price per unit and the total. It is possible to agree on a price escalation clause, which ties the price to a certain exchange rate. In addition to this, it is possible to enter into a so-called SWAP transaction with banks for the purpose of a currency hedge.
- Type of payment such as advance payment or payment deadline.
- Terms of delivery: state the delivery terms, based on one of the Incoterms 2020.
- Taxes, duties and charges: clarify responsibility for all taxes. The prices quoted by the seller may include taxes, duties, and charges. Levies in the country of import (if any) are the buyer's responsibility.
- Delivery: specify the place of dispatch and delivery. Also state whether the period of delivery will run from the date of the contract, from the date of notification of the issue of an irrevocable Letter of Credit, or from the date of receipt of the notice of issuance of the import license by the seller.
- Packaging, labelling, and marking: note all packaging, labelling and marking requirements in the contract.
- Terms of payment and payment security as explained in the chapter above.
- Insurance to protect the goods against loss, damage, or destruction during transportation. Specify the type of risks covered and the extent of the coverage.
- Documentary requirements such as the bill of exchange, commercial invoices and other invoices, bill of lading or airway bill, insurance policy and Letter of Credit.
- Protecting intellectual property clauses (if any) required under the sale.
- Force majeure or excuse for non-performance of contract: include provisions in the contract defining the circumstances that would relieve partners of their liability for non-performance of the contract.
- Remedial action: as defaults in contractual obligations by any of the parties can occur, it is always advisable to include certain specific remedial actions. These remedial actions should reflect the mandatory provisions of the law applicable to the contract.
- Governing law: since trade with foreign partners mostly involves two laws, it is possible to select one of them as the governing law.
- Place of jurisdiction: foreign trade contracts usually include a provision on the place of jurisdiction. The place of jurisdiction defines which court is competent for a possible dispute between the parties.
- Arbitration: as an alternative to legal proceedings before a general jurisdiction court, it is also possible to settle disputes between contracting parties before an arbitration court.
- Inclusion of general terms and conditions: you may agree not to have them.
- Signature of the parties.
- For your first contracts, ask the help of a lawyer who is experienced in international trade.
- Be precise in the definition of your product specification. You can use a general product specification template (pdf) for food products. More specifically, make use of internationally recognised standards to better define your offer. Examples include standards of Codex Alimentarius or UNECE Standards for Dried Fruit and Vegetables and Edible Nuts.
- When claiming specific characteristics of the product, indicate international recognised testing methods such as those of the International Standards Organisation. Those can be related to the moisture content for the specific product or to the way the presence of pathogenic microorganisms is tested.
7. Make a checklist of all your export documents and regularly review it
There are many different documents you will need to finalise your export and get paid. Depending on legal and private requirements, you may sometimes need more than 200 documents. To organise your export smoothly you should make a checklist of all documents you need for export to Europe. In your checklist, you should classify your documents in categories for easier orientation. For example, you can classify documents in the following way:
- Documents you must have for each shipment (for example your invoice, transport documents, and certificate of origin)
- Documents you should have to be more competitive (such as your contract, food safety certificate, letter of credit, and laboratory tests)
- Documents you need to work with specific buyers (for example an organic certificate, a Code of Conduct, tests on allergens, or quality assurance documents for retail chains)
The most important types of documents that should be on your checklist are documents of origin, commercial documents, freight documents, administrative documents and any documents that your buyers may require.
Documents of origin
To benefit from possible reduced tariffs when exporting to Europe, you should obtain a document of origin. You should check which organisation is authorised to issue this document in your country. Often it is issued by customs authorities or a Chamber of Commerce, but it differs for each country. A common practice is to hire a freight forwarder to obtain a document on your behalf. Depending on the type of trade agreement between your country and the European Union, two types of documents of origin are used:
- Form A – You will use Form A as a document of origin if your country is part of the Generalised Scheme of Preferences (GSP)
- EUR.1 – You will use a EUR.1 certificate of origin if your country has signed a preferential trade agreement with the European Union. If the export value is lower than €6,000, you will only write a statement on your invoice (invoice declaration).
To obtain a certificate of origin, you must follow specific rules relevant for your product. For example, if you export a mix of frozen vegetables, a certificate of origin will usually be based on proof that all vegetables are produced in your country (or free trade agreement-specified region). On the other hand, if you export fruit juices you may process fruit from other countries, but only if the value of non-domestic fruit does not exceed 30% of the ex-works price of the juice. If sugar is added to your product, it must not exceed 40% of the weight of the final product.
Several types of commercial documents are obligatory for export procedures. These include:
- Proforma invoice – A proforma invoice is used to show the importer the exact amount to be paid and the method of payment. It is also necessary to open a letter of credit. In some cases, a proforma invoice is required to obtain special permits or licences (for example, in the export of wild-collected mushrooms or fruit).
- Commercial invoice – A commercial invoice is a document that customs authorities require as evidence of your export. It basically states the amount of money to be paid for your products. When opening a letter of credit, the invoice can be used instead of a contract. In some rare cases, your buyer may ask you to get the invoice certified by a specific authority such as a Chamber of Commerce.
- Packing list – A packing list specifies the (number of) goods in individual packages, and it usually gives the gross and net weights, the dimensions of each package and the number of pallets and packages. It is not required by customs authorities, but it can help customs inspectors if they wish to open a certain package for inspection. Although it is not mandatory, transport companies often require this document. Because of that it can be classified as a transport document but also as a commercial document.
Administrative and transport documents
Several types of administrative documents are relevant for the export of processed fruit and vegetables to Europe:
- Phytosanitary certificate – In-shell nuts, pecans and pine nuts need a phytosanitary certificate to be exported to the European Union. However, such a certificate is not required for shelled nuts and any other type of processed fruit and vegetables. A phytosanitary certificate is issued by the authority in your country. In many countries you can also authorise a third-party provider to obtain a certificate on your behalf.
- Health certificate – This is a type of certificate that suppliers must provide to the European customs authority if their country is part of a stricter import conditions regulation. A health certificate, together with the analytical test report, is necessary for a certain percentage of the shipments from specified countries.
- Transport documents – Depending on the means of transport used, different documents are carried by the transport company and presented to the European customs authorities. Those include a Bill of Lading (commonly used in sea transport as a receipt of goods by the transport company), Road Waybill (used in road transport), Rail Waybill (used in rail transport), Airway bill (used in air transport) and FIATA Bill of Lading (used when products are carried by more than one mode of transport).
Several types of other documents may be required, either by your buyers or by customs authorities. Typical examples include:
- Certificate of analysis – It is common practice for your buyer to ask you to submit laboratory test results as proof that your products comply with legal requirements. Those tests are performed by accredited laboratories. Common laboratory tests analyse microbiological contaminants, pesticide residues, heavy metals, irradiation, allergens and product composition.
- Product specification (also called technical data sheet) – This document is used to specify quality and food safety parameters of your product, and the methods used for determination.
- Export certificate – In some countries, exporters must obtain an export certificate to export food items. It is not required by the European authorities, so you must check within your country if such a certificate is required.
- Weight certificate – In some cases of exporting retail pack products, your importer may require a document proving that the weight or volume of the packaging corresponds to the label. This proof is commonly issued by an independent inspection body.
- Certificate of inspection – In some rare cases, buyers may require a certificate of inspection to prevent fraud and to ensure that products comply with the contract. Those certificates are issued by independent inspection agencies.
- Black list certificate – In rare cases of export of processed fruit and vegetable by air, you may need a certificate stating that the air transport company is not banned by the European authorities.
- CITES certificate – If you export certain types of wild-collected products, you can be asked to provide a certificate proving that the collection of those products does not threaten the survival of the species.
- Voluntary certificates – Exporters use many types of private certifications to increase competitiveness and reach different market segments. Many of them are discussed in our study on buyer requirements. Those certificates are used as proof that your company follows certain rules regarding different aspects such as food safety, organic production, sustainability, ethical and fair trade, and ethnic food rules.
- Financial insurance document – Such as a Letter of Credit, export insurance policy, or bank guarantee.
Documents your importer must obtain to import your goods
Obviously, you are not responsible for the documents that your buyer must provide to finalise customs procedures. However, you may need to give your buyer some input to help them correctly fill out all forms required by the European customs authority. If you have already successfully exported to Europe, it would be good to ask your buyers or freight forwarders to share the correctly filled documents for customs clearing with you. Those include a Single Administrative Document (SAD), customs value declaration and warehouse guarantee.
Please note that a customs value declaration is often mentioned in export guides on the internet as a document issued by the exporter, which is not true. The main purpose of this document is to assess the value of the goods to apply tariff duties. Tariff duties are commonly paid by your buyer, unless you have agreed on Delivery Duty Paid (DDP) Incoterms. However, developing country exporters rarely use DDP, as they would need to have a registered company in Europe to organise all the import formalities.
- Hire freight forwarders to get advice on export documents and procedures.
- Use Access2Markets to quickly check which rules of origin apply for your product.
- Ask your buyer to send you an example of the invoice, especially when you work with him/her for the first time. This will help you avoid possible customs delays and problems.
8. Use assistance of support organisations when organising your export to Europe
There are many organisations where you can seek support, in your country as well as abroad. The section below lists the most relevant organisations for exporters of processed fruit and vegetables that can support you in the organisational and logistical issues related to export. Many of those organisations are already mentioned in the other chapters of this study, but the most recognised are the following:
- International Nuts and Dried Fruit Council (INC) – Aside from the international promotion of the consumption of nuts and dried fruit, the INC provides a lot of information concerning technical issues related to trade. For example, they publish technical guides for different products, including packaging, transport and storage guidelines. Also, INC organises an e-learning academy covering many topics, including logistics or arbitration rules.
- European Fruit Juice Association (AIJN) – Representing the voice of the European juice industry, AIJN provides useful information for its members, including codes of practice and guidelines.
- International Trade Centre (ITC) is a development agency for sustainable trade with publications such as How to Access Trade Finance (pdf), Model Contracts for Small Firms and the SME Trade Academy that provides online courses (some are free of charge), including international transport and logistics.
- Access2Markets is a guide to duties, taxes, product rules and requirements on the market of the European Union.
- International Chamber of Commerce (ICC) has worldwide offices and offers arbitration, export learning tools and information about incoterms.
- Your own Chamber of Commerce can provide you with advice and information. They usually have staff specialised in dealing with certain issues such as transport, trade agreements and legal issues.
This study has been carried out on behalf of CBI by Autentika Global.