- M -
The extent to which a domestic industry can penetrate
a related market in a foreign country. Access can be limited by
or other non trade barriers.
insurance: Insurance that
compensaes the owner of goods transported
at sea in the event of loss that cannot be legally recovered from the
Master Lease: A
contract where the lessee
leases currently needed assets and is able to acquire other assets
the same basic terms and conditions without negotiating a new contract.
Date at which payment is due
under a term bill of exchange.
A market segment generally
represented by financing under $2 million. In leasing this sector
is dominated by single investor leases.
Nation Treatment (MFN): When one country accords another
status, it agrees to extend to that country the same trade concession
grants to other MFN recipients. GATT members have agreed to
each other MFN status. Preferential treatment accorded developing
countries, customs unions and free trade areas all represent allowable
to the MFN concept. This is sometimes now called "Normal Trading
- N -
National Treatment: The concept that countries must afford
the same access and other benefits they do local domestic firms.
Bank nominated on a letter
of credit to negotiate the bill of exchange, i.e. check the documents,
pay the seller and seek reimbursement from the
discussion and give and
take leading to an agreement. In respect to Letters of credit is
“buying” of a bill of exchange drawn on another party. In
where letters of credit are settled by negotiation, a negotiating bank
nominated to check
the documents, pay the seller and seek reimbursement from the Issuing
bank. Alternatively the credit may be freely negotiable at any bank.
Net Lease: A
lease wherein payments to the
lessor do not include insurance and maintenance, which are paid
by the lessee.
In a leveraged lease, the
lenders cannot look to the lessor for repayment. The lender's only
is to the lessee and, therefore, the lessee's credit rating is of prime
Barriers: Measures other than tariffs that restrict
Import quotas, standards, licenses, and other policies can serve as
Operating Common Carrier: Also known as an NVOCC, a company
which consolidates small
shipments from different sources consigned to the same destination into
a single container for shipment overseas by either ocean or air
accounts: Accounts held
by correspondent banks in each others' currencies. Each such
has a nostro view - our money held with you - and a vostro view - your
money held with us.
Notify party: the
party who is to be notified
when goods arrive at their destination.
- O -
Ocean bill of
lading: A bill of lading
indicating that the exporter consigns
a shipment to an international carrier for transport to a specified
destination. Unlike an inland bill of lading, the ocean bill of
also serves as a collection document.
On boar bill of
lading: A bill aof lading
inwhich a carrier certifies that goods
have been placed on board a certain vessel.
Trading method in which goods
are dispatched to a buyer and paid for after they have been received.
trading and collections:
A bill of exchange that will be drawn on and accepted by the buyer.
Policy: A marine insurance
policy that applies to all shipments made
by an exporter over a period of time rather than to one shipment only.
Opening bank: Another
name for the Issuing
bank in a letter of credit.
Open-end Lease: A
conditional sale lease
in which the lessee guarantees that the lessor will realize a minimum
from the sale of the asset at the end of the lease.
Operating Lease: Any
lease that is not a
capital lease. These are generally used for short term leases of
The lessee can acquire the use of equipment for just a fraction of the
life of the asset. Additional services such as maintenance and
may be provided by the lessor.
Private Investment Corporation. A US agency that assists US
protect their investment against risk in a particular country besides
a form of endorsement or transfer.
On a bill of exchange, 'order' or 'to order' means that the drawer
that payment be made to another party (usually a bank).
On a bill of
lading: 'order' or 'to order'
transfers or assigns title to the goods to another party.
collection: How the Remitting
bank refers to a collection. Collection being sent overseas to
bank(s) for presentation to buyer.
Outward letter of
credit: How the Issuing
bank refers to a letter of credit.
- P -
Packing list: Document
listing the contents
of a consignment of goods. May be called for on a letter of
person or organization
putting together a proposal. In leasing, the leasing company,
banker, or broker who arranges a leveraged lease.
license that secures the holder the exclusive
right to make, use or sell and invention.
Party to whom payment is due.
In a letter of credit, bank
that is nominated to make payment to the
beneficiary upon presentation of
Perils of the Sea:
An insurance term used to designate heavy weather
stranding, collision, water damage or lightning.
Risk that political instability
in the buyer's country will interfere with a buyer's ability to meet
The current equivalent of
payments or a stream of payments to be received at various times in the
future. The present value will vary with the discount interest factor
to future payments.
In a collection, presentation
of documents by a bank to a buyer for payment
or acceptance. In a letter of credit,
presentation of documents by a seller to a
bank for payment, acceptance or
period: On a letter of credit,
number of days allowed between shipment of goods and presentation of
to a bank.
Presenting bank: In
a collection, bank that
presents documents to a buyer for payment or
Prime letter of
credit: In a back-to-back
letter of credit transaction, the original letter of credit that is
as security for another letter of credit (second letter of credit).
Main Party to a transaction.
Invoice: An invoice provided by
a supplier prior to the shipment
of merchandise, informing the buyer of the kinds and quantities of
to be sent, their value, and important specifications.
Financial document in which
the buyer agrees to make payment to the seller at a specified time.
Legal procedure that may be administered
by a notary public, evidencing non-payment or non-acceptance of a bill
exchange. Useful in support of a subsequent civil action against the
In a collection, the presenting bank may be instructed to arrange for
A provision in a document
that gives the party receiving the benefit the right to purchase the
at a future date. In leasing, a provision by which a lessee has
right to purchase the equipment at the end of the lease. The purchase
may be stated at a specified amount or at fair market value.
The requirement to purchase
an asset at a particular time and at a predetermined price. This term
used in stock, commodities and leasing. In a lease transaction,
is a lessor's right to force the lessee (or some third party) to
the equipment at the end of the lease term. IRS guidelines prohibit put
options in tax oriented leases.
- Q -
of goods of a specific type that may be imported without restriction or
the imposition of additional duties.
- R -
The right to demand return of money
paid. In negotiation of a letter of credit, payment by the negotiating
will normally be with recourse (i.e. if the Issuing bank subsequently
A letter of credit instructing
an advance payment to be made to the beneficiary upon advice of the
but before shipment of the goods.
bank: Bank specified as a source
of funds in a letter of credit transaction. Bank is not a party to the
letter of credit.
Document given by a bank to
a buyer to enable buyer to claim the goods from the carrier. Used when
are consigned to the bank as a means of retaining constructive control.
party making a payment.
Remitting bank: In
a collection, bank who
remits the documents overseas and in due course receives payment.
Residual Value: The
value of an asset at
the conclusion of a lease.
endorsement: Endorsement transferring
title or right to a named party. See also: blank endorsement.
of credit: Letter of credit
which may be amended or cancelled unilaterally. Offers no security to
and so very rare.
of credit:A Letter of credit
designed to cover a series of similar consignments over a period of
consignment note: Transport document used
for goods sent by road. This is not a document of title.
Rules of Origin:
Rules used to determine in what
country a good will be considered as actually made for tariff and other