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2b. Pronunciation

Check the pronunciation of the following words:

labelling, origin, distributor, ingredients, expiry, permanent, legible, conspicuous, stencilling, embossing, moulding, precaution, reminder, suffocation, analogous, identification, distinguish, lead, enclosed, triangle, diamond, enclosure, target, purchase, destined, coded, measurement, cautionary.

2с. Vocabulary

Find English equivalents of the following in the text:

маркировка, маркирование; меняться, варьироваться; тщательно следовать; страна происхождения; срок годности, срок хранения; четко обозначены, промаркированы; на постоянной основе; разборчиво; на видном месте; в печатном виде; нанесение по трафарету; тиснение; штамповка; самоклеящаяся этикетка; в качестве меры предосторожности; напоминание для потребителей; удушение; детская кроватка; грузовая маркировка; полагаться на; чтобы отличить одну партию от другой; легко распознаваемый; старая маркировка; вторичная упаковка; несоответствующая информация; помешать идентификации товара; соответствовать маркировке и нумерации; транспортные документы; главный знак; быть вставленным в знак любой формы (треугольник, ромб); чтобы не стать объектом хищений; номер заказа на покупку; порядковый номер; вес нетто; метрические единицы; имперские единицы измерения; фунты; футы;

дюймы; предупреждающая маркировка.

2d. Over to you

Read the instructions about marking and mark the carton below.

“… We would like you to send 400 tins of paint. The item number is P58. The tins should be packed in 10 large cartons, 40 tins in each carton. Each carton measures 110cm x 55cm x 55cm and weighs 20kg. The weight of the cartons is 4kg.We would like you to stencil the following in

capital letters on each carton: S.O.F in diamond Barcelona; inflammable – paint; handle with care…”

Unit 4. Methods of Loading and Unloading

1. Traditional Cargo Handling Methods

1a. Reading

Read the text about traditional methods of cargo handling.

Traditional Loading and Unloading

Commodities and cargoes may be in solid dry form, or they may be liquids or gases.

The traditional liquid cargoes are mainly crude oil and its refined products, vegetable oils, wines, various chemicals, and even water. In bigger lots liquid cargoes are carried loose in ships, i.e. they are pumped from tanks on shore through pipelines to tanks on board the ship and vice versa. In smaller lots liquids and gases are stored and moved in containers or flasks. When gas is moved in tanks on board ships, it is often liquefied by low temperatures. When packed in this way, the commodities may be regarded as dry cargo from a transport point of view.

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The dry cargoes include raw materials, semi-finished or finished goods. Raw materials like grain, coal, ores, tapioca, copra, and salt are moved in homogeneous unpacked lots. Such bulk cargoes can be handled in many different ways. Grain is mostly loaded by conveyors or chutes and unloaded pneumatically, while ores and coal are mostly moved with conveyors or grabs.

General cargo is a term that covers a great variety of goods. It refers to individual items of any type of cargo, bagged or baled items, cases or crates, individual drums or barrels, pieces of machinery, or small

items of steel construction. In regard to modern cargo handling it refers to loose cargo that has not been consolidated for handling with mechanical means such as unitised or containerised cargo.

Conventional cargo is the cargo transported in bulk, in boxes, and/or on pallets. This requires high quality export packaging (for example, very strong wooden crates), offers very low security, and is damage

prone due to multi-handling and exposure to weather conditions.

Pallets (Unitised loads)

Pallets were conceived for easy handling of all types of stackable items such as small cases, cartons, or bags; they consist of wooden boards as a floor on which goods are placed, a wooden top, and the whole being securely strapped to constitute a compact unit. The floor itself is nailed onto wood blocks, which allows for passage of the prongs of a forklift. Standard Europallets have the following dimensions: 120 × 80 cm and US pallets 120×100 cm. Pallets are ideal for loading into containers and facilitate easy handling by forklift.

If general cargo is to be loaded on a ship in general stow, it is usually man-handled into place. The reason why general cargo is rarely seen in developed countries today is that the cost of handling such items is too high and the time taken is unacceptable for most maritime operations.

1b. Pronunciation

Check the pronunciation of the following words:

refined, flasks, homogeneous, conveyor, chute, pneumatically, facilitate, unitised, prone, exposure, conceived, stackable, constitute, prongs, Europallets, forklift, stow, unacceptable.

1c.Vocabulary

Find equivalents of the following in the text:

светлые нефтепродукты; перевозить без тары; закачивать; фляга/бутыль; полуфабрикаты; руда; однородный; жёлоб; захватное устройство; традиционный; подверженный; незащищенность от погодных явлений; грузовые пакеты; штабелируемый; стягивать

лентами, ремнями; зубья; автопогрузчик; укладка (в трюме).

2. Containerisation

2a. Reading

Read the text about the history and classification of containers.

Container Revolution

Before 1956 general cargo was loaded and unloaded to and from the hold of the ship using cranes and slings. This required costly manpower, was time-consuming, and sometimes resulted in damaged or lost cargo. General cargo moving between developed countries today is usually containerised and carried on cellular container or Ro-Ro vessels. The container ships used in the international traffic are designed with the cells (compartments with cell guides) resembling a honeycomb wherein the containers are placed, thus named cellular container ships.

In 1956, Malcolm McLean, President of McLean Trucking Company in North Carolina, the US, experimented by placing loaded 35-foot highway trailers onto a ship rather than unloading the contents. The experiment worked, but soon they realised that only the box should be loaded and unloaded. The chassis and wheels could be left behind. This, however, required that the box be removable from the chassis. The concept of the container was born.

Next, it was necessary to create a new system of transportation. Containers had to be designed for a wide variety of cargos. New ways of loading and unloading containers had to be created. Ports needed

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facilities to transfer containers to ground transportation. Lorries and railway wagons had to be designed to carry the containers. Workers had to be trained in new cargo handling techniques. It started a revolution in transportation.

Almost any commodity can be containerised. The great advantage to the shipping industry is that the cargo is not man-handled on and off the ship, instead the container is handled with fast and sophisticated handling equipment. Naturally, in developed countries, where labour is expensive, significant savings can be made. The cargo itself needs less protective packaging. The cargo can be stowed in the container away from the wharf, often by the shipper himself. Documentation and identification of cargo is simplified as the container number replaces the cargo mark. Computers and electronic data interchange now play a large part in ensuring the correct cargo movement.

Container Classifications

Containers are available in configurations to take almost every kind of cargo and mode of transportation (ocean, air, road, and rail). In terms of the type of cargo for which the containers are mainly intended, they are classified as general cargo containers and specific cargo containers.

A standard container is a metallic box (steel or aluminium) with a double door at one end, in which general cargo can be safely loaded and transported. Container sizes are standardised so that they can be stacked, and so that loading and unloading equipment can be designed to those standards. The most widely used size is the 40-foot container, another standard size is the 20-foot container. Of all the containers in the world, about two thirds are 40-foot and about one third are 20-foot. The ports worldwide handle over 100 million TEUs annually. The unit TEU (twenty-foot equivalent unit) is used to express the relative number of containers based on the equivalent length of a 20' container. For example, 100 containers of 20' is 100 TEUs,

while 100 containers of 40' is 200 TEUs.

2b. Reading

Read the descriptions of different types of containers and match them with the pictures below. General purpose (dry cargo) container

It is suitable for the widest varieties of cargo. It is fully enclosed and weatherproof, having rigid walls, roof, and floor, with at least one of its walls, either end wall (end loading) or side wall

(side loading), equipped with doors.

Open top container

It is similar to the dry cargo container except that it has no rigid roof, but has a movable or removable cover (e.g. a cover made of canvas, plastic, or reinforced plastic material) supported on movable or removable roof bows. The open top container is used for machinery, sheet glass, and other heavy, bulky or

long objects.

Thermal container (reefer)

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2c. Vocabulary

Find equivalents of the following in texts 2a and 2b:

стропы (такелажные цепи); дорогостоящая рабочая сила; занимающий время; состоящий из отсеков (ячеек); технически сложное разгрузочное оборудование; значительная экономия; универсальный (общего назначения); полностью закрытый; стойкий к атмосферным воздействиям;

жесткие стенки; дуги на крыше; рефрижератор; изолированный.

Unit 5. Terms of Delivery

1. International Commercial Terms

1a. Reading

Read the text about the INCOTERMS.

International Commercial Terms

The INCOTERMS (International Commercial Terms), also known as terms of delivery, are the essential part of any export-import transaction and standard trade definitions used in international sales contracts. They were developed by the International Chamber of Commerce (ICC) in Paris. They define the trade contract responsibilities and liabilities between buyers and sellers. The exporter and the importer need not undergo a lengthy negotiation about the conditions of each transaction. Once they have agreed on a commercial term like FOB, they can sell and buy at FOB without discussing who will be responsible for the freight, cargo insurance, and other costs and risks.

The INCOTERMS were first published in 1936 (INCOTERMS 1936), and they are revised periodically to keep up with changes in the international trade needs.

Under the INCOTERMS 2000, the international commercial terms were grouped into E, F, C, and D, designated by the first letter of the term.

In Groups E and F the seller’s obligations were minimal, and the buyer had to do most of the work and assume maximum risk. In Group C the supplier’s obligations became more extensive, however the buyer still assumed risks. In Group D the supplier made most arrangements and assumed maximum risk, whereas the buyer had to pay for and arrange import customs clearance and unloading from the forwarder’s vehicle at the final destination.

The latest issue was released in 2010 and took effect on January 1st, 2011. The INCOTERMS 2010 rules take into account developments in global trade since they were last revised in 2000. These include changes in cargo security, which has been at the forefront of the transportation agenda for many countries since 9/11, and the increased use of electronic communications in business transactions. Revisions have been made to ensure that the wording of the INCOTERMS rules clearly and accurately reflects present-day trade practices.

In contrast to the previous four classes – E, F, C, and D – INCOTERMS is now separated into 2 groups, those applicable to all modes of transport and those only applicable to sea and inland waterway transport.

INCOTERMS 2010 applicable for all modes of transport: EXW : ex works

FCA : free carrier CPT : carriage paid to

CIP : carriage and insurance paid to DAT : delivered at terminal

DAP : delivered at place DDP : delivered duty paid

INCOTERMS 2010 only applicable for sea and inland waterway transport: FAS : free alongside ship

FOB : free on board CFR : cost and freight

CIF : cost, insurance and freight

Four sales terms have been removed – DAF (“delivered at frontier”), DES (“delivered ex ship”), DEQ (“delivered ex quay”) and DDU (“delivered duty unpaid”). They have been replaced by two new

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terms, DAP (“delivered at place”) and DAT (“delivered at terminal”). Therefore, there are eleven sales terms altogether, compared to thirteen sales terms with the INCOTERMS 2000.

The sales terms FOB, CFR, and CIF have been adjusted or additional explanation have been provided. The point is, for example, that regarding FOB the transfer of risk happened formerly if the goods had passed the vertical of the ship´s rail – it was similar with CFR and CIF. Now it is made clear that the transfer of risk does only happen if the goods have been set down on the ship. Another small part of the risk has been transferred to the supplier.

Additionally, the new sales terms contain suggestions that in modern container traffic the sales terms CFR and CIF are barely helpful, because the circumstances in modern container ports no longer do justice for the determination of the transfer of risk by means of the loading on the ship (now: set down of the goods on the ship). It is recommended to use in container traffic the sales terms CPT or CIP (in these cases the transfer of risk happens in case of surrendering the goods to the carrier).

ICC recommends that INCOTERMS 2010 be referred to specifically, whenever the terms are used, together with a location. For example, the term "Free Carrier (FCA)" should always be accompanied by a reference to an exact place to which delivery is to be made. To prevent misunderstandings, parties need to make the intended effect of any variants of the three-letter INCOTERMS rules extremely clear in their contract. Incorrect use of INCOTERMS 2010 rules has the potential to lead to legal consequences.

Below is an example of the correct use of INCOTERMS rules: “FCA 123 Example Street, Paris, France INCOTERMS 2010”

The new set of sales terms will also take more strongly into account “supply chain security” and electronic documents.

1b. Comprehension

Answer the questions on the text.

1.What are INCOTERMS rules?

2.What do they cover?

3.Why are INCOTERMS rules successful worldwide?

4.Do INCOTERMS rules apply to international or domestic contracts of sale?

5.What are the 11 INCOTERMS 2010 rules?

6.How are INCOTERMS rules correctly used?

7.Why do INCOTERMS rules need revising periodically?

8.Can you name some of the main innovations in INCOTERMS 2010?

1c. Vocabulary

Match the abbreviations with their expansion and translation.

1d. Comprehension

Arrange the INCOTERMS in order beginning with the most favourable for the seller.

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Part II

Unit 1. Customs in the 21st century 1. Missions of Customs 1a. Discussion

1.Anything to declare? Where can you hear this question? What main responsibilities of Customs do you know?

2.What does this pictorial symbol mean in your opinion?

1b. Reading

Read the text about traditional and modern tasks of Customs around the world and see if you were right.

Quo vadis Customs?

For centuries, the Customs role has been one of a “gatekeeper”, with сustoms authorities representing a barrier through which international trade must pass, in an effort to protect the interests of a nation. This role is reflected, for example, in the traditional British сustoms symbol, the portcullis, which is a symbolic representation of the nation’s ports.

The face of Customs has changed. Besides collecting taxes and duties on the border, it now performs many other important tasks. Customs is an authority or agency (administration) in a country responsible for controlling the flow of people, animals and goods, in and out of the country. Depending on local legislation, exporting or importing of some goods may be restricted or forbidden, and the сustoms agency is enforcing these laws. The сustoms agency monitors people leaving and entering the country, checking for appropriate documentation. It is also responsible for protection of cultural heritage and enforcement of intellectual property laws, and fulfils the functions on behalf of other government authorities in such areas as health, agriculture, environment, trade statistics, and immigration.

The responsibilities of сustoms administrations can vary from country to country. In many developing and least developed countries, import duties and taxes represent a significant proportion of the national revenue. Because of this, the main focus for their сustoms authorities is revenue collection. In developed countries, on the other hand, with relatively little reliance on imports as a source of government revenue, there is an increasing focus on border protection. However, the current trend towards global free trade and the recent heightening of international terrorism concerns have made border security a priority across all Customs.

Nowadays, Customs all over the world are experiencing technological, economic and legal changes which require new approaches. Customs authorities therefore need to prepare for the new tasks.

1c. Vocabulary

Find equivalents of these words in the text:

таможенные органы (власти); опускная решетка; сбор налогов и пошлин; управление; поток людей; законодательство; ограниченный; запрещенный; контролировать людей; соответствующий; культурное наследие; соблюдение законов об интеллектуальной собственности; выполнять функции от имени кого-либо; национальный доход; зависимость от импорта; современная тенденция; обострение проблем международного терроризма; приоритет;

подвергаться изменениям.

Fill in the gaps to give a summary of the main customs functions.

Customs:

• collects and duties on the border;

•the flow of people, animals and goods;

•for appropriate documentation;

•protects cultural ______;

•intellectual property laws;

•a nation against terrorism;

•the functions on behalf of other government authorities.

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1d. Discussion

1.What is the priority of the Russian customs authority?

2.Is the Russian customs authority ready for the changes connected with free global trade?

2.Ethical Issues

2a. Discussion

1.Read the Mission Statement of US Customs and Border Protection paying attention to the last mission. What do you think is meant by “vigilance” and “integrity”?

Our Mission

•We are the guardians of our Nation’s borders.

•We are America’s frontline.

•We safeguard the American homeland at and beyond our borders.

•We protect the American public against terrorists and the instruments of terror.

•We steadfastly enforce the laws of the United States while fostering our nation’s economic security through lawful international trade and travel.

•We serve the American public with vigilance, integrity and professionalism.

2.People of what professions from the list below do you normally associate with corruption? What kinds of corrupt practices could they engage in? What damage could they do? Who

suffers from their corruption?

•Country leaders

•Doctors

•Customs officers

•Sports officials

•Police officers

•Local government officials

3.Read an article from the BBC News site (August 2006). What is the biggest corruption scandal connected with Customs you can remember? Do you think Customs is becoming a more or a less corrupt place? What can be done to eliminate corruption? What causes corruption?

Customs men jailed for smuggling

Two customs officers from Kent have been jailed for helping to smuggle millions of pounds worth of alcohol and cigarettes into the UK.

Paul Weaver, 35, and Steven Phillips, 34, got backhanders for clearing at least five illicit shipments through Ramsgate, Southwark Crown Court heard. Both admitted their part in an international smuggling ring which cheated Customs of more than £7m duty. Weaver was jailed for four years and Phillips for four- and-a-half years. They had pleaded guilty to conspiring to evade duties between 1 January and 10 December, 2003.

2b. Reading

Read the text about the Model Code of Ethics and Conduct prepared by the World Customs Organisation (WCO). Explain in your own words the importance of each key element of the Code.

The public expect all customs officials to be honest, impartial and professional. To maintain public confidence it is important that customs officials maintain the highest standards of

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integrity in their dealings with members of the public, the business community, and other government officials.

A key element of a good integrity program is the development, issue, and acceptance of a code of conduct which sets out the standards of behaviour expected of all customs officials. To assist customs administrations in developing appropriate codes of conduct, the WCO has prepared a Model Code of Ethics and Conduct.

The 11 key elements of the code of conduct are:

1.Personal Responsibility

2.Compliance with the Law

3.Relations with the Public

4.Acceptance of Gifts, Rewards, Hospitality and Discounts

5.Avoiding Conflict of Interest

6.Political Activities

7.Conduct in Money Matters

8.Confidentiality and Use of Official Information

9.Use of Official Property and Services

10.Private Purchases of Government Property by Staff

11.Work Environment

To fully comply with the code, each official needs to:

•perform duties with care, diligence, professionalism, and integrity;

•strive for the highest ethical standards, not just the basic legal requirements;

•behave at all times in a manner that maintains or enhances the reputation of Customs.

In addition, supervisors and managers have a particularly important role to play and must be prepared to:

•lead by example;

•ensure that staff are familiar with the relevant legislation, required standards, departmental procedures, and instructions;

•take appropriate actions when staff fall short of the required standards.

2c. Vocabulary

Find English equivalents of the following in the text:

честный; беспристрастный (объективный); поддерживать общественное доверие; выпуск и принятие Кодекса поведения; излагать нормы поведения; соответствие законодательству; гостеприимство; скидки; избегать; конфликт интересов; государственная собственность; рабочая обстановка; усердно исполнять обязанности; стремиться к самым высоким этическим стандартам; требования закона; повышать авторитет таможни; предпринимать

соответствующие меры; не соответствовать требуемым стандартам (нормам).

Unit 2. Customs Duties and Tariffs. Tariff Systems.

1. Customs Duties and Tariffs.

1a. Discussion

1.What is the original mission of Customs?

2.Customs services of what countries do these logos represent?

1b. Reading

Read the text about customs duties and tariffs and answer the following questions:

1.What are customs duties levied on?

2.What are different types of customs duties?

3.How long is the history of collecting import duties?

4.What are the reasons for imposing duties?

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Customs duty (also called tariff) is a tax levied on a commodity traded across the border of a country or a group of countries that have formed a customs union. In ancient and medieval times, such tariffs were even collected by local governments. Now this is very rare. Typically they are collected by national governments or, in a customs union, by the regional authority.

The taxed goods can be anything, but for practical purposes tariffs usually apply to items that are easily detected, classified, and measured or valued. Generally, tariffs (duties) are assessed on the imported goods. Taxes on the exported goods also exist but are less common. Transit duties or taxes may be assessed on goods passing through a customs area en route to another destination. A tariff may be assessed in a number of ways, including directly, at the border, or indirectly, by requiring the prior purchase of a licence or permit to import given quantities of the goods.

An import tariff is a schedule of duties imposed by a country on imported goods. Import duties are traditionally designed to raise revenue for the government. However, they can also be applied for protective purposes such as:

•reducing the level of imports by making them more expensive relative to domestic substitutes (this lowers a balance of trade deficit);

•to counter the practice of dumping by raising the import price of the dumped goods to market level;

•to retaliate against trade barriers imposed by another country, which is called a trade war or trade sanctions;

•to protect key industries such as agriculture;

•to protect a new industry until it is sufficiently well-established to compete on the international

market.

Protective duties increase the cost of imports to consumers, thereby reducing their demand. Properly applied duties will increase the development of local industry, as well as protect it from foreign competition.

1c. Vocabulary

Find all verbs from the text that can be combined with the nouns “duty” and “tariff”. Which of the verbs have similar meaning?

2. Methods of Calculating Duties

2a. Reading

Read the text about how customs duties are calculated.

Methods of Calculating Duties

Customs duties can be designated in either specific or ad valorem terms or as a mix of the two.

In case of a specific duty, also known as fixed duty, a concrete sum is charged for a unit of quantity (weight, volume, or item count), for example USD 1 per item or per unit. The customs value of the goods does not need to be determined, as the duty is not based on the value of the goods but on other criteria. In this case, no rules on customs valuation are needed.

In contrast, an ad valorem duty (which literally means “according to value”) depends on the value of the goods. Customs duty is charged as a percentage of the value of the imported goods. Under this system, the customs value is multiplied by an ad valorem rate of duty (e.g. 5 per cent) in order to arrive at the amount of duty payable on an imported item. Therefore, the amount of customs duty payable depends on the customs value of the goods. The term “customs value” refers to the value of the imported goods for customs and duty purposes. It is assigned to merchandise at the time of entry and can be calculated in a number of ways. Under the WTO Valuation Code, adopted by the most of the world’s nations, there are 6 methods of valuation which must be applied in strict hierarchical order.

Method 1 — Transaction value

Method 2 — Transaction value of identical goods Method 3 — Transaction value of similar goods Method 4 — Deductive method

Method 5 — Computed method Method 6 — Fall-back method

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Method 1 is the most common valuation method used. In fact, over 95% of all imports are valued under this method. The transaction value is the price paid or payable for the goods by the buyer to the seller. If there is no sale, you cannot use method 1 and you must try another method, starting from method 2. If method 2 is unsuitable, you must go to method 3, etc.

A compound duty, also known as a mixed duty, is calculated using a combination of ad valorem and specific factors; both quantity or weight and the value of the goods are taken into consideration. This kind of duty is imposed on goods in order to prevent the amount of duty falling below a certain minimum. An example of a compound duty: Country A assesses a compound duty on imports of car batteries. The duty consists of 10 percent of the value plus $1.00 per battery. A shipment of 100 batteries valued at $2,000 would be assessed at a $300 compound duty (10 percent of $2,000 + $1.00 × 100 = $300).

2b.Vocabulary

Find English equivalents of the following in the text:

специфическая пошлина; таможенная стоимость товара; правила определения таможенной стоимости; адвалорная пошлина; иерархический порядок; метод по стоимости сделки с ввозимыми товарами; метод по стоимости сделки с идентичными товарами; метод по

стоимости сделки с однородными товарами; метод вычитания стоимостей; метод сложения

стоимостей; резервный метод; комбинированная пошлина.

2c. Comprehension

Answer the questions on the text.

1.How are customs duties calculated?

2.What was the reason for designing the WTO Valuation Code?

3.Tariff Systems 3a.Reading

Read the text about tariff schedules. Make a chart representing different types of tariffs. Tariff Schedules

A Tariff Schedule is a comprehensive list of the tariffs which a country applies to imported goods. It is the legal basis on which the Customs levy the customs duty and is also the specific embodiment of the tariff policies of a country. Generally, the tariff consists of two parts, i.e. the

tariff nomenclature and tariff rate. The tariff nomenclature mainly includes the description of goods and the corresponding code called tariff number, which is known as the heading and subheading.

There are many divisions for the tariff. The tariff system can be divided into the single tariff and the complex tariff according to the setup of a tariff rate.

The single-column tariff is a tariff schedule listing only one duty rate for each imported product. With this system, there is only one level of import duty for each product, wherever the country of origin. Over the past few decades, the single tariff has been abandoned by more and more countries because it can hardly reflect the discriminatory treatment for different countries. At present, only few countries adopt this kind of tariff system.

The complex tariff, also called the multiple-schedule tariff, refers to the tariff setting with two or more rates under one heading, suitable for different countries or regions.

The double-column tariff is a tariff schedule listing two duty rates for some or all commodities. Under such arrangements, imports may be taxed at a higher or lower rate, depending upon the importing country's relationships with the exporting country. Some British Commonwealth countries maintain a double-column tariff that provides preferential tariff treatment to other members of the Commonwealth. The United States and other countries also have lower tariffs for countries to which they grant most-favored- nation treatment.

Below are the forms of the double-column tariff:

1. Maximum-minimum form

This is the system where both levels of tariff are set autonomously by a particular country, without modification by an international agreement. The maximum tariff rate is applicable to the countries with which that country has not signed trade or mutual benefits agreement; the minimum tariff to the countries with which that country has signed trade or mutual benefits agreement.

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