Glossary of Trade Terms

A document that certifies the country where the product was created (i.e., its origin).  A certificates of origin may be an "ordinary CO" (no preferential tariff treatment) or a "preferential CO" (tariff reduction or exemption).

Carried out on the basis of a fee or percentage of sales in order to take advantage of existing distribution networks and a partner’s knowledge of local markets.

A document, prepared by the exporter or freight forwarder, that is required by the buyer to prove ownership of the goods and arrange for payment to the exporter.

A Customs Union with common policies on product regulation and freedom of movement of capital and labour.

A company, based in a foreign country, that acts as a foreign buyer’s agent and places confirmed orders with an exporter, guaranteeing payment.

Delivery of merchandise to a buyer or distributor, where the latter agrees to sell it and only then pay the Canadian exporter. The seller retains ownership of the goods until they are sold but also carries all of the financial burden and risk.

A statement issued by a foreign consul in the exporting nation describing the goods purchased. Some foreign governments require Canadian exporters to first obtain consular invoices from their consulate in Canada. A fee is usually charged.

A written or oral agreement which the law will enforce.

The joint production of goods in order to optimize the skills and resources of the firms involved as well as to take advantage of economies of scale.

Protection granted to the authors and creators of literary, artistic, dramatic and musical works, and sound recordings.

The exporter pays the costs and freight necessary to get the goods to the named destination. The risk of loss or damage is assumed by the buyer once the goods are loaded at the port of embarkation.

The exporter pays the cost of goods, cargo and insurance plus all transportation charges to the named port of destination.

A generic term for export transactions where the sale to the purchaser is conditional upon a reciprocal purchase or undertaking by the exporter.

Additional duties imposed by an importing country to offset government subsidies in an exporting country when the subsidized imports cause material injury to domestic industry in the importing country.

Each firm in a partnership licenses its products or services to the other.

A form of cross-licensing in which companies agree to manufacture each other’s products.

A professional who provides customs services including the processing of customs, import and export documentation, and release of commercial goods through the local customs authority.

A document that traditionally accompanies exported goods bearing such information as the nature of the goods, their value, the consignee and their ultimate destination. Required for statistical purposes, it accompanies all controlled goods being exported under the appropriate permit.

A document used to clear goods through customs in the importing country by providing documentary evidence of the value of goods. In some cases, the commercial invoice may be used for this purpose.

A trading block consisting of two or more countries that have eliminated trade barriers among themselves and imposed a common tariff on all goods imported from all other countries (e.g., ASEAN).