Customs: Introduction to the Commercial Invoice

I like the commercial invoice. It is the one document which touches on nearly every party involved in the international trade process in one way or another. It also provides allot of information without being overly technical.

          A single commercial invoice is used and/or viewed by the exporter and importer, at least two commercial banks, the SA Reserve Bank and its equivalent overseas, two Customs authorities, the insurance broker, the transporter, and at least one Customs Clearing and Forwarding Agent. They all act as major role players in relation to the invoice.

          A commercial invoice is somewhat different from a tax invoice. Tax on international trade is zero rated. No tax is reflected on it. A commercial invoice is used for international trade transactions. It contains Customs related information such as international commercial terms, origin criteria and currency codes.

          Documents which either support or depend on the commercial invoice include the packing list, indent order, insurance document, bank payment documents, exchange control documents, forward exchange risk cover, Customs declarations and its supporting documents on each side of the border, the contract of sale, regional trade agreements, and international sales and delivery terms such as Incoterms (International Commercial Terms).

          While the invoice is central to the commercial transaction between the buyer and the seller, it must meet with a number of Customs requirements. These are legislated in the Customs Acts and documented in numerous SARS Customs SOP’ (Standard Operating Procedures). Go to and search under “Find a Publication”.

          Importing or producing blank or incomplete invoices which are capable of being completed is an offence.

          The Customs authorities recognise the following types of invoices namely the pro-forma invoice, the commercial invoice, and consular invoices (i.e. for diplomats and ambassadors). The former two will be covered in subsequent blogs.

          Some of the larger and more complex issues which also relate to the invoice will be discussed independently from the Blogs which specifically cover invoices. However, some (i.e. tariff, valuation and rules of origin) may be covered briefly in this section from time to time.

          Minimum Customs requirements pertaining to the commercial invoice will be discussed here. It will include issues such as language, when there is a lack of information on the invoice, amended invoices such as debit and credit notes, and the like.

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