A commercial invoice is the seller's invoice for goods actually sold and shipped. It identifies the parties, describes the goods, and states quantities, prices, currency and charges. In international trade it is also the document customs authorities use to classify and value the goods, so what it must contain is set by regulation, not only by custom.
Why It Matters
In the United States a commercial invoice must be presented for each shipment when the entry summary is filed (19 CFR 141.81), and 19 CFR 141.86 lists what it must show: the port of entry, who sold to whom and when, a detailed description of the goods, quantities, the purchase price in the currency of purchase, itemized charges such as freight and insurance, rebates, the country of origin, and any assists. The same fields drive the buyer's accounts payable, landed-cost accounting and trade-finance document checks, so an incomplete invoice fails in several places at once.
How It Works in Practice
- 1The seller issues the invoice when the goods ship, from the order and the shipping documents.
- 2The importer or customs broker files it with the entry; the description supports classification, and the price and charges support valuation.
- 3The buyer's accounts-payable team matches it to the purchase order and the receiving record before paying.
- 4Where the commercial invoice is not available at entry, the importer files a pro forma invoice and produces the commercial invoice later (19 CFR 141.91).
Common Pitfalls
Leaving charges bundled into the price. 19 CFR 141.86 requires charges such as freight, insurance, commissions and packing to be itemized by name and amount; packing and inland freight to the port of export need not be itemized if they are included in the price and identified as such.
Omitting assists. Goods or services the buyer supplied for producing the merchandise, such as dies, molds, tools or engineering work, must be shown if they are not included in the invoice price (19 CFR 141.86(a)(11)); leaving them out understates the customs value.
Describing goods by a marketing name. The regulation asks for the name each item is known by, its grade or quality, and the marks, numbers and symbols under which it is sold in the country of export.
Letting one invoice cover several shipments. Apart from installment shipments, an invoice may not represent more than one distinct shipment by one consignor to one consignee on one vessel or conveyance (19 CFR 141.81).
Sources
- 19 CFR 141.81, Invoice for each shipment — Electronic Code of Federal Regulations
- 19 CFR 141.86, Contents of invoices and general requirements — Electronic Code of Federal Regulations
- 19 CFR 141.91, Entry without required invoice — Electronic Code of Federal Regulations
Related Terms
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