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why is phytosanitary certificate important for exports?

October 12, 2024October 11, 2024 by sirisha vaddi

Phytosanitary certificate for plant exports — Phytosanitary certificate and measures

The Phytosanitary Certificate is a key document for exports trade compliance of plants and plant products. The sanitary and phytosanitary measures taken in fomenting of planned products are crucial for the exports to get accepted by the importing country.

Two of the most popular Indian spice brands, MDH and Everest are facing global scrutiny after Hong Kong, Singapore and Nepal suspended sales of their spice blends last month.

After regular screening, a cancer-causing pesticide — ethylene oxide was found in some of the company’s products. countries including the UK, Australia, the Maldives, and the US are ramping up their testing of Indian spice products.

This highlights the need for Sanitary and Phytosanitary measures are vital to prevent the spread of pests and diseases within countries and across borders.

Why is a Phytosanitary Certificate Important?

The Phytosanitary Certificate is a vital for exports of plants and plant products.

When plants or plant products are exported without proper inspection, they can carry pests or diseases that could harm the agriculture of the importing country. This could lead to economic losses, environmental damage, and strict trade restrictions.

Therefore, having the phytosanitary certificate reduces the risk of shipment being rejected or placed under quarantine, which can be costly and time-consuming.

What is a Phytosanitary Certificate?

A Phytosanitary Certificate is a document that confirms that plants or plant products being exported have been inspected and are free from pests and disease-carrying organisms;

This certificate is issued by the National Plant Protection Organization (NPPO) of the exporting country, and is sent to the importing country.

The certificate ensures that the plants or plant products meet the health standards required by the importing country to protect Member’s territory from damage arising from the entry, establishment or spread of pests.

Products Covered Under a Phytosanitary Certificate

The exporter needs to obtain the Phytosanitary Certificate for exporting the following types of products:

A phytosanitary Certificate is an important document to export regulated articles such as plants, seeds, bulks, and tubers
For exporting seeds for propagation, fruits and vegetables, cut flowers and branches, grain, and growing medium.
The phytosanitary certificate is also needed for certain plant products that have been processed and have a potential for introducing regulated pests (For example, cotton or wood).
PSC is needed to export contaminated articles such as empty shipping containers, vehicles, or other organisms.

Types of Phytosanitary Certificates

There are two main types of Phytosanitary Certificates:

Phytosanitary Certificate for Export purposes:

This is the standard certificate issued when plants/ plant products are being exported from one country to another.

It confirms that the products have been inspected and found to be free from pests and diseases.

The NPPO of the country of origin issues a Phytosanitary certificate for export.

A Phytosanitary certificate for export declares that the consignment meets the country’s Phytosanitary requirements.

Phytosanitary certificate for re-export purposes

This certificate is issued when plants or plant products that were imported into a country are being re-exported to another country.

It ensures that the products are still free from pests and diseases and have not undergone any treatments not recognized by the importing country.

A Phytosanitary Certificate for re-export will be issued by the NPPO of the re-exporting countries where the commodity was not grown or processed to change its nature in that country and only where an original phytosanitary certificate for export is available.

Prescribed Authority:

The prescribed authority for issuing the Phytosanitary Certificate for Export is the Plant Quarantine Information System, Department of Agriculture, Co-operation and Farmer Welfare, Government of India.

Validity Details:

To ensure the Phytosanitary integrity and physical integrity of consignment, the validity of PSC before export is limited to a maximum period of 7 days for perishable consignments and 30 days for non-perishable consignments. It should be ensured that the goods will be shipped immediately after certification.

Time Limit to Apply:

The applicant needs to apply at least 2-3 days before the actual date of the shipment of the consignment. In the case of the export of seed consignments, such applications need to be filed 8-10 days before the actual date of shipment.

Note: Export of perishable commodities such as cut flowers, fresh fruits, and vegetables, the above conditions may not apply.

what documents required phytosanitary certificate in India for Export ?

Obtaining a phytosanitary certificate in India involves a few essential documents. To simplify the process, ensure the following papers ready:

Importing Country’s Permit: This permit from the destination country gives you the green light to export your goods or commodities.
Wildlife Clearance Certificate: If your items fall under the Convention on International Trade in Endangered Species of Wild Flora and Fauna, you’ll need this certificate.
Letter of Credit: A document showing your commitment to payment is crucial for smooth international transactions.
Shipping Bill or Bill of Lading : Depending on the mode of shipping, provide the relevant bill, be it air, sea, or land transport.
Packing List: A detailed list of your shipment’s contents is handy for proper identification.
Export License: An authorization proving you’re allowed to export your products.
Fumigation Certificate: This confirms your goods have undergone fumigation to prevent pests.
Purchase Order: Your customer’s order details, ensuring everything is aligned.
Fees and Charges: Be prepared to cover export inspection fees and fumigation costs.
Invoice Copy: A copy of your invoice is a key part of any trade.

Benefits of Phytosanitary Certificates:

Global Access for trade:
With these certificates, your fruits and veggies can travel to countries that demand healthy plant produce.
customs clearance:
Customs clearance becomes easy. Certificates speed up the process, minimizing delays at the border.
Importer Confidence:
Importers trust certified products. Certificates show the goods are top-notch and ready to enter the market.
Eco-Friendly export produce:
Adhering to health standards, makes the export produce eco-friendly for a greener planet.
Rejection Defense:
Certificates lower the risk of rejection. Export produce is less likely to be turned away due to health concerns.
Regulation Friendly:
Certificates simplify navigating international rules. Phytosanitary certificates are like a safety net for the product. From smooth entry into new markets to ensuring safe and healthy deliveries, they partner in successful fruit and veggie exports.

Summary:

Phytosanitary certificates are essential for ensuring safe international trade of plants and plant products. By complying with regulations, and working closely with Import country authorities, exporters can contribute to maintaining the health of ecosystems while enjoying the advantages of successful exports.

Export specific buyer & Consignment export policy under ECGC

October 26, 2024October 8, 2024 by sirisha vaddi

credit risk insurance policy for exporters

Export (Specific Buyer) policy of ECGC:

The ECGC credit insurance policies protects an exporter of goods and services against the risk of non-payment by an overseas buyer. If an overseas buyer fails to make payment for the goods or services received, the ECGC insurance company will reimburse the seller or exporter. The specific buyer policy and consignment export policy are designed to cover credit risk associated with such transactions.

when is (Specific Buyer) policy needed for an exporter?

An exporter may require an insurance policy for a specific buyer or an LC opening bank which may tend to default payment.

This policy is suitable for importers located in countries within volatile, ambiguous business environment. The specific buyer policy, provides cover for shipments made to a Specific Buyer or an LC opening bank for a set of Buyers.

The exporter has to take the export specific buyers policy if he/she does not hold the standard policy or whole turnover policy. ECGC covers the credit risk through this policy in such cases.

what is the period of specific buyer policy and percentage of risk covered?

The period of this policy is 12 months and risk covered the same as that of the standard policy. Percentage of risk tower is 80%.

what are the important obligations for an exporter to obtain export specific buyer policy ?

Important obligations for exporter under specific buyer policy
Processing fee of Rs 2000 nonrefundable is payable.
The premium is payable in four equal instalments in advance before commencement of risk
Submission of monthly declaration of shipments by 15th of the subsequent month.
Submission of payment advice slip.
Notifying or declaring payments for bills that have remained unpaid beyond 30 days from its due date of payment by the 15th of the subsequent month.
Filing of claim within 360 days from the due date of export bill, or 540 days from the expiry date of the policy cover, whichever is earlier.
Initiating recovery steps, including legal action.
Sharing of recovery.

key highlights of Export Specific Buyer policy are:

only a selective buyer can be insured.
If an importer has a tendency to default and are located in countries within volatile, ambiguous business environment, one can have a standard policy and simultaneously an export specific buyer policy.
An exporter does not have to declare all the other export shipment under export specific buyer policy.
The policy offers a facility of no claim bonus of 5% subject to no claim up to a maximum of 50% as in the case of other credit insurance products of ECGC.
Exporter needs to take a separate policy for each buyer.

Consignment export policy (stockholding agent) of ECGC:

Consignment sales has recently emerged as a new focal area of business opportunity in foreign markets.

The consignment sale is a trade where a seller or a consignor, hands over his cargo to a buyer or consignee on the expectation of possible and emergent sale in the consignee’s market.

This consignment sale is based on payment mode of Documents against acceptance (DA) or time draft.

The consignment sale is executed without receiving the payment of the exported goods and trust between the consignor and consignee is the basis of this EXIM transaction.

The consignor is exposed to unlimited risk as the consignee or the stock holding agent may sell the cargo and does not remit export proceeds or cargo may not get sold at all.

The consignment sale as a marketing technique is increasingly adopted by Indian exporters to have an agency agreement with independent and separate entities in foreign countries.

Such business entities can be an agent, a franchise, a licensee, a consignee and an importer who receive and hold cargo stocks ready for sale to overseas buyer, as and when order are received, find buyers and sell them for a commission on such sales.

In order to address a credit risk associated with such unique, unpredictable transaction, ECGC has designed a separate credit insurance policy known as consignment export policy, which is introduced to cover the shipments made by exporters on consignment basis to their agent.

The risks covered under the policy are commercial or political risk on stockholding agent and ultimate buyers.

Key Highlights Of the consignment export policy are

the risk cover is available only for those EXIM transactions which are affected under the consignment sale.
The period of the policy is 12 months.
ECGC allows an extended PERIOD for the realization of up to 360 days.
The policy also has a standard clause of offering NCB of 5% subject to no claim until a maximum of 50%.
ECGC offers very high percentage of the cover of 90% for EXIM transaction under consignment export policy.

There is an automatic cover on ultimate buyers to discretionary limits, subject to buyers in a country placed in open cover category and not in the list of buyers on whom the ECGC corporation has adverse information referred to as Buyers specific approval list.

Important obligations for exporter under consignment export policy
Processing fee of Rs 4000 nonrefundable is payable.
The premium is payable in four equal instalments in advance before commencement of risk and sufficient deposit should be maintained in advance.
Submission of monthly declaration of shipments by 15th of the subsequent month.
Submission of payment advice slip.
Notifying or declaring payments for bills that have remained unpaid beyond 30 days from its due date of payment by the 15th of the subsequent month.
Filing of claim within 360 days from the due date of export bill, or 540 days from the expiry date of the policy cover, whichever is earlier.
Initiating recovery steps, including legal action.
Sharing of recovery.

This policy is unique in the sense that it offers coverage, even for commercial risk, on sales agents.

Did supply chain and logistics play a major role in Lebanon Pager blasts?

September 20, 2024 by sirisha vaddi

Behind every trade that happens, there is an organized and well coordinated supply chain and logistics cycle. Every layer of the cycle plays a significant role in delivering the products to its end customer. The recent Lebanon pager blasts across multiple cities reveals the hidden layers in the supply chain network.

Security sources from Lebanon say that Israeli spy intelligence Mossad is believed to be the mastermind behind these attacks. Israel has neither confirmed nor denied the accusations.

Hezbollah officials have accused Israel of targeting their communication devices. “The Mossad injected a board inside of the device that has explosive material that receives a code. It’s very hard to detect it through any means, even with any device or scanner.” An unnamed source said that 3,000 of the pagers exploded when “a coded message was sent” to them, simultaneously activating the explosives.

One must be wondering why Lebanon’s are still using pagers when the world is moving forward with 5G technology. Well, it’s not the common people who are using this. The pagers are used as a main communication device by the members of the Hezbollah group. Since the attack of Hamas in October last year on Israel, there has been escalating tensions between Israel and Hezbollah of Lebanon.

Hezbollah chief has earlier warned their members to disown the smartphones and find 5G technologies, as he believed that they would become a soft target of the Israeli intelligence. Moving a step forward, the group transition to using pagers for secure communication. Dating back to three months from today, the Hezbollah group has ordered 5000 pagers from a Taiwanese company named Gold Apollo.

The company’s founder, Hsu Ching-kuang, told reporters, that the AR-24 Model pagers that expolded in Lebanon were made by another company licensed to use its brand.

Gold Apollo founder, identified that the BAC Consulting company, based in Hungary is authorized to use Gold Apollo’s logo for product sales in certain regions.

However, BAC Consulting Chief Executive Cristiana Bársony-Arcidiacono confirmed that her company worked with Gold Apollo. But stated that their company didn`t make any pagers, and they are just an intermediary in the manufacturing of pagers delivered.

Hungarian Justice Ministry records show that a firm with the name BAC Consulting was registered as a new company on May 21, 2022. Its main activities listed retail trade of telecommunications products, as well as management consulting, jewelry making and cultivation of fruit.

A record from May 2, 2020, suggests that a company of the same name had existed in the past and was shut down in 2020.

Zoltán Kovács, a spokesperson for the Hungarian prime minister, said on X that authorities have confirmed that BAC Consulting was a trading intermediary that was not manufacturing or operating in Hungary and that “the referenced devices have never been in Hungary.”

Taiwan’s Economic Affairs Ministry said on Wednesday that Gold Apollo had exported 260,000 pagers from 2022 to August 2024, primarily to European and American markets. In a statement, it said there had been no reports of explosions related to those products and that there were no records of the company exporting pagers directly to Lebanon.

So what remains as as a puzzle is “Was this batch of pagers actually tampered in the supply chain cycle? ….. Did another manufacturer produce them and simply label them with the Apollo brand? …….Did Israel float shell companies across various countries, seizing the opportunity to overpower the militant Hezbollah group by counterfeiting those products by deceptive means. This part is still under investigation by the authorities.

N.R. Jenzen-Jones, director of Armament Research Services, a technical intelligence consulting firm said that. “The scale suggests a complex supply-chain attack, rather than a scenario in which devices were intercepted and modified in transit,” he said on X.