Glossary of Trade Terms

A company that buys export receivables at a discount.

A percentage of professional consulting fees (typically between 15-30 percent) withheld by the foreign client and remitted directly to the tax authority if the exporter does not have a local office. The fees may be recovered by filing the appropriate income tax forms; however, the whole process results in payment delays of up to 18 months

Funding a new export venture – i.e., what is needed to move from a domestically-focused business model to one that is internationally oriented and export based.

A form of financing in which medium-term financial obligations (notes) are sold at discount and usually on a non-recourse basis, at a fixed rate of financing.

A more specific form of licensing in which the franchisee is given the right to use a set of manufacturing or service delivery processes, along with established business systems or trademarks, and to control their use by contractual agreement.

The price quoted includes charges for delivery of the goods alongside a vessel at the port. The exporter handles the cost of unloading; wharfage, loading, ocean transportation, and insurance are left to the buyer.

Similar to Free on Board, except that the exporter’s obligations are met when the goods are delivered into the custody of the carrier at the named port. The risk of loss/damage is transferred to the buyer at this time and not at the ship’s rail.

The exporter is responsible for the cost of goods to the point of loading them on board the vessel deck or aircraft loading deck at the port of shipment specified in the sales contract. The risk of loss or damage is transferred to the buyer when the goods have been so delivered.

The same principles apply as in the case of ordinary FOB, except that the goods are transported by rail or road.

A service company that handles all aspects of export shipping for a fee.

A designated area where foreign companies can operate without paying duties on imported inputs.