Topic freight forwarding process of fcl shipment imported by sea at hanotrans company

 Basically, freight forwarding is a collection of operations and procedures related to the transportation process in order to carry out the movement of goods fromthe place of shipment t

VIETNAM MARITIME UNIVERSITY

INTERNATIONAL SCHOOL OF EDUCATION

INTERNSHIP REPORT

TOPIC FREIGHT FORWARDING PROCESS OF FCL SHIPMENT IMPORTED BY SEA AT HANOTRANS COMPANY

VIETNAM MARITIME UNIVERSITY

INTERNATIONAL SCHOOL OF EDUCATION

STUDENT NAME: DUONG THUY LINH

CLASS: IBL0901

INTERNSHIP REPORT

TOPIC FREIGHT FORWARDING PROCESS OF FCL SHIPMENT IMPORTED BY SEA AT HANOTRANS COMPANY

Division: Logistics

Faculty: Economics

HAI PHONG – 2021

TABLE OF CONTENTS

LIST OF ABBREVIATIONS

ICD Inland Clearance Depot

D/O Delivery Order

EIR Equipment Interchange Receipt

B/L Bill of Lading

MB/L Master Bill of Lading

C/O Certificate of Origin

ED/O Electronic Delivery Order

FCL Full Container Loaded

THC Terminal Handling Charges

LIST OF TABLES

LIST OF FIGURES

Figure 1: The Logo of Hanotrans Company 9

Figure 2: Container Tractors of Hanotrans Company 12

Figure 3: Organizational Structure of Hanotrans Company 14

Figure 4: Reliable Partners and Customers of Hanotrans Company 17

As an economics student, I realize the importance of internships when studying atMaritime University This internship helps students apply the knowledge they havelearned in practice, thereby deepening, and broadening their understanding of thesubject they are studying At the same time, this is also an opportunity for students

to practice soft skills and attitudes so that after graduation, they can adapt well tothe working environment at enterprises

In this internship, I chose Hai Phong Branch of Hanotrans Logistics Co., LTDwith the topic "Freight Forwarding Process of FCL Shipment Imported by Sea”.This is a company with typical activities of international business and logistics,thereby helping me understand more about the field of study as well as future careerorientation

CHAPTER 1: THEORETICAL BACKGROUND

1.1 Theoretical background of freight forwarding

1.1.1 What is imported goods?

In general, imported goods are all goods and products that have beenmanufactured from another country and imported through Vietnam's border gates to

be circulated in the country, the origin of this item is abroad It doesn't matter who

or where the goods are produced, as long as their place of production is abroad,licensed to manufacture according to foreign regulations and imported to Vietnamaccording to import and export regulations are called imported goods Therefore,even if the factory is owned by Vietnamese people, the workers to produce thegoods are Vietnamese, or the production materials are partly sourced from Vietnam,but the production locations, production facilities,… are in foreign countries, whenimported together to Vietnam, it will also be called imported goods

1.1.2 Definitions of freight forwarding

Freight forwarding is all about the facilitation of international trade The freightforwarder is the party who ensures that internationally traded goods move frompoint of origin to point of destination to arrive at the right place, at the right time, ingood condition and at the most economical cost

According to FIATA, freight forwarding is defined as any service relating to thetransportation, consolidation, storage, handling, packing or distribution of goods, aswell as consulting or related services to the above services, including customs,financial matters, insurance, payment, collection of documents related to the goods

According to Vietnam's Commercial Law 2005, freight forwarding service is acommercial act whereby a person providing freight forwarding services receivesgoods from the sender, organizes the transportaYon, storage, storage, and handling

of goods, paperwork and other related services to deliver the goods to the consigneeunder the consignment of the shipper, the carrier or another forwarding serviceprovider (collectively, the customer)

 Basically, freight forwarding is a collection of operations and procedures related

to the transportation process in order to carry out the movement of goods fromthe place of shipment (the consignor) to the place of receipt (the consignee)

1.2 Related documents in freight forwarding process for imported FCL shipment

- Arrival notice: is a letter sent to the importer by the shipping company to notify

the ship of the arrival of the ship

- Bill of lading (B/L): is a fundamental international shipping document used in

ocean transportation (ocean B/L) It is issued by a shipping company to theconsignor after the goods have been received to transport or have been loaded onboard The B/L is extremely important because it fulfills three roles in aninternational transaction: It is a contract of carriage; It is a receipt for the goods; and

It is a certificate of title

There are usually two types of bills of lading:

o Master bill of lading (MB/L) is a bill of lading issued by the shipping line tothe recipient after the goods have been loaded onto the ship Normally, tofacilitate and simplify the procedures when receiving goods abroad, theforwarder often requires shipping line to issue Surrended Bill of Lading(Surrended B/L), and the most important thing is that the shipping line mustnotify their agent abroad about this problem so that the receipt of goods issmooth

o House bill of lading is a type of bill of lading issued by the freight forwarderand sent to the goods owner to receive the goods and carry the consignmententrusted by the exporter

- Certificate of origin (C/O): a document provided by the exporter’s Chamber of

Commerce, attests that the goods originated (not manufactured) from the country inwhich the exporter is located The C/O is used by importing countries to determinethe tariff applied to the goods as most countries apply a multicolumn tariff system –different groups of countries pay different tariffs

- Sales contract: is a document signed between the buyer and the seller, which

clearly and fully states the terms and conditions that have been agreed upon by thetwo parties and are governed by the Commercial Law Accordingly, the buyer andthe seller must be responsible for strictly complying with the terms set forth in thecontract

- Packing list: a packing list always accompanies the shipment It is a detailed

document provided by the exporter that spells out how many containers there are inthe shipment and which merchandise is packaged in each container

- Delivery Order (D/O): issued by the carrier or his agent for the purpose of

instructing (requiring) the port or cargo administration to transfer the lien of thegoods to the named party (delivery to the importer)

- Customs declaration: is a document that the exporter or importer needs to

declare in detail about information, quantity and specifications of goods to beexported or imported from abroad to Vietnam

- Equipment Interchange Receipt (EIR): is one of the important documents in

import and export It is a type of drying sheet that records the condition of thecontainer (good, bad, punctured, in addition, there are other information such as thenumber of containers, the number of trucks pulling the containers, the owner of thegoods )

1.3 Theoretical freight forwarding process

Depending on the requirements of each order as well as the status and policy ofeach import forwarding company, there will be its own specific process However,basically, the freight forwarding process for FCL shipment imported by sea willhave 9 basic general steps as follows:

Step 1: RECEIVING AND CHECKING THE SET OF DOCUMENTS

After the two parties have agreed on the terms, agreed on the price, and signed aforwarding contract, the customer will send the documentation staff a set of basicdocuments including: Sales Contract, Packing List, Commercial Invoice, Bill ofLading, along with important information such as the estimated time of arrival ofthe ship, information – vessel/ voyage number,

At this time, the documentation staff will check whether the information betweenthe above documents matches or not, ensuring all necessary information is completeand accurate If detecting errors or mismatches between the information of thedocuments, the documentation staff should immediately contact the customer tocorrect or supplement in time

Step 2: GETTING DELIVERY ORDER (D/O)

Usually, you will receive an Arrival Notice about 1 to 2 days before the estimatedtime of arrival To get D/O, after the ship docks, the forwarder brings a full set ofdocuments along with the introduction of the customer's company, to the shippingcompany to get a D/O delivery order You will have to pay some fees when takingdelivery orders such as D/O fee, THC fee, container cleaning fee, handling,

There are currently 2 ways to get a delivery order:

 Delivery orders taken directly:

The operation staff goes to get the order and puts the documents in the importdocument counter At the import document counter, the operation staff of theForwarder company will pay local charges to the cashier at the accounting counter.Depending on the method of each shipping line, some shipping lines will collectdirectly at the cashier counter, issue a red invoice directly to the shipping line Theperson taking the order will have to provide some information such as: tax code,address, company name, for the accountant to write a red invoice Some othershipping lines have other payment methods such as asking staff to take the order tothe bank to transfer local charges, when transferring money is completed, theoperation staff will bring the money transfer paper to the cashier The cashier willissue a red invoice to the customer (operation staff) or a temporary receipt

After the operation staff completes the payment of local charges, the shipping linewill issue a D/O D/O includes 2 copies and is valid for use within 3 days from thedate of issue The first copy is intended to be used by operation staff to collectorders to bring to the customs department along with a set of documents tocomplete the customs clearance of the declaration The second copy is used togetherwith a set of documents including: customs clearance declaration, B/L, introductionpaper for the purpose of operation staff to bring to the port to exchange for EIR.After completing the procedure to get the D/O, the operation staff will go to thecontainer pile counter Here, operation staff will fill in all information including:vessel name, voyage number, B/L number, importer's name, private warehouseaddress, container number, seal number and paying shell deposit

 Electronic Delivery Order (ED/O):

Up to this point, there are 5 major shipping lines that issue and deliver ED/Oelectronic delivery orders Those are shipping lines: KMTC, HEUNG A, MAESKLINE, SITC, HAPAG-LLOYD

The advantage of the ED/O order is that the customer - the importer does not have

to bring documents directly to the shipping company, pay local charges to get D/O.This saves the company time and manpower Employees only need to sit at theoffice to contact and register with the shipping line to receive ED/O email form.The accountant will transfer the local charges to the shipping company to get theD/O and the container deposit Shipping lines after notifying the money will sendED/O via email The documentation staff prints the D/O (not much different fromthe D/O taken directly

Step 3: ELECTRONIC CUSTOMS DECLARATION AND TAX PAYING

Currently, to declare an electronic customs declaration, users can use theECUS5/VNACCS software of the Customs authority or can use other softwareregistered with the authorities and licensed When the customs declaration issuccessfully transmitted, the receiving system will automatically notify you ofinformation such as: receipt number, declaration number and cargo flow status(green/yellow/red)

- Green stream: Clearance

- Yellow stream: Check the profile (additional fee)

- Red stream: Checked (Check the file and cut the lead to check the goods in thecontainer and there will be an additional fee)

At this point, forwarder will receive the import customs declaration Forwarderprints out this set of declarations and proceed to contact the taxpayer

Step 4: REGISTRATION OF DECLARATION AT THE PORT

When the electronic customs declaration is successful and the declaration isprinted The next thing to do is to prepare a complete set of documents to registerthe declaration at the port Specifically:

- Import customs declaration

After preparing the full set of documents, the forwarder will bring it to thecustoms The customs office will receive the dossier and conduct an inspection Ifthere is nothing unusual, then transfer the file to the tax calculation department toreport the tax rate to be paid.

Step 5: RETURNING CUSTOMS DECLARATION

When the document checking (or inspection) is completed, the documents arestamped and then moved to the customs declaration return door At this time,forwarder will buy stamps to stick on the declaration (stamps are considered ascustoms fees)

The returned set of dossiers will include: Customs declaration with stamp,document inspection result sheet (if it is a red stream, there is a note of goodsinspection results) The forwarder is responsible for checking whether thedocuments are complete If enough, proceed to the next step

Step 6: CHANGING EQUIPMENT INTERCHANGE RECEIPT (EIR)

After getting the D/O on the shipping line and completing the customs clearanceprocedures (at the regional customs), the forwarder will prepare the documents to

go to the port to exchange the EIR

In order to issue the EIR, the forwarder needs to go to the Trade Office at the port

to submit the D/O with the shipping company's stamp of direct delivery Next, theforwarder needs to pay for lifting / lowering and storing the container

Step 7: CUSTOMS LIQUIDATION

To carry out port customs liquidation, the forwarder will bring a set of documentsincluding Delivery Order D/O, EIR slip, Customs declaration (including originaland photocopy), and a list of containers to be submitted for Customs This agencywill save the shipment information in the customs book, and at the same time stampthe declaration, EIR slip, and confirm on the container list sheet Then return thesedocuments to the forwarder

Step 8: DELIVER THE GOODS TO THE SHIPPER, RETURN THE EMPTY

CONTAINER AND TAKE THE SHELL BET

At this point, the freight forwarding process for FCL shipment imported by sea isbasically completed Now the forwarder just needs to give the EIR slip, container

list, and container loan certificate to his container driver, and enter the port or ICD

to receive the goods Driver will check seal integrity, container number, sealnumber, container condition If there is a problem, the driver will make a note Incase the driver is careless and does not check, the driver will be responsible for hisown container, related to the cost of repairing the container

After completing the withdrawal, based on the indication written on the containerloan, the driver will return the empty container to the port or ICD Next, theforwarder will bring the EIR slip, container deposit paper and receipt to theshipping agent to carry out procedures to receive the deposit of the previouslyclosed container

Step 9: ACCOUNTING AND SAVING THE DOCUMENTS

The final step in freight forwarding process for FCL shipment imported by sea is

to complete the documents That is, after completing the import clearance and thegoods have been transferred to the customer, the document staff will be responsiblefor checking and arranging fully and carefully the documents into a complete set.One set will be returned to the customer, and one set will be put into storage Alongwith that, a copy of Debit Note will be sent to the customer