Creating

DATA NOTES 87
Trading across borders
Doing Business compiles procedural requirements for exporting
and importing a standardized cargo of goods. Every official
procedure for importing and exporting the goods is
recorded—from the contractual agreement between the two
parties to the delivery of goods—along with the time necessary
for completion. All documents and signatures required
for clearance of the goods across the border are also recorded.
For importing goods, procedures range from the vessel’s arrival
at the port of entry to the cargo’s delivery at the factory
warehouse. For exporting goods, procedures range from the
packing of the goods at the factory to their departure from
the port of exit.
Local freight forwarders, shipping lines, customs brokers
and port officials provide information on required documents
and signatures as well as the time to complete each
procedure. To make the data comparable across countries,
several assumptions about the business and the traded goods
are used.
Assumptions about the business
The business:
• Has 100 or more employees.
• Is located in the country’s most populous city.
• Is a private, limited liability company, formally registered
and operating under commercial laws and regulations of
the country. It does not operate within an export processing
zone or an industrial estate with special export or import
privileges.
• Is domestically owned with no foreign ownership.
• Exports more than 10% of its sales to international
markets.
Assumptions about the traded goods
The traded product travels in a dry-cargo, 20-foot, full container
load. The product:
• Is not hazardous nor does it include military arms or
equipment.
• Does not require refrigeration or any other special
environment.
• Does not require any special phytosanitary or environmental
safety standards other than accepted international
standards.
The following Standard International Trade Classification
(SITC) Revision 3 categories are considered by the
respondents:
• SITC 65: textile yarn, fabrics, made-up articles.
• SITC 84: articles of apparel and clothing accessories.
• SITC 07: coffee, tea, cocoa, spices and manufactures
thereof.
Documents
All documents required to export and import the goods are
recorded. It is assumed that the contract and letter of credit
have already been agreed upon and signed by both parties.
Documents include port filing documents, customs declaration
and clearance documents and official documents
exchanged between the concerned parties. Documents filed
simultaneously or in packages are considered different documents
but with the same time frame for completion.
Signatures
A signature is defined as an approval, signature or stamp that
clears one or more formal procedures. It need not be a physical
signature. Electronic signatures are also counted. A
mandatory verification from supervisors is also considered a
signature. If a document requires approval from several departments
or from several individuals within a department,
approvals or signatures from all levels are counted. Signatures
of the importer and exporter are excluded.
Time
Time is recorded in calendar days. The time calculation for a
procedure starts from the moment it is initiated and runs
until it is completed. If a procedure can be accelerated for an
additional cost, the fastest legal procedure is chosen. It is assumed
that neither the importer nor the exporter wastes time
and that each commits to completing each remaining procedure
without delay. Procedures that can be completed in parallel
are treated as simultaneous for the purpose of measuring
time. The waiting time between procedures (for example,
during unloading of the cargo) is included in the measure.
Enforcing contracts
Indicators on enforcing contracts measure the efficiency of
the judicial (or administrative) system in the collection
of overdue debt. The data are built by following the stepby-step
evolution of a payment dispute either before local
courts or through an administrative process, if such a process
is available and preferred by creditors. The data are collected
through study of the codes of civil procedures and other
court regulations as well as surveys of local litigation lawyers.
At least 2 lawyers participate in each country, and in a quarter
of the countries judges also complete the survey. To ensure
comparability, survey respondents are provided with
significant detail, including the amount of the claim, the location
and main characteristics of the litigants, the presence
of city regulations, the nature of the remedy requested by the
plaintiff, the merit of the plaintiff’s and the defendant’s
claims and the social implications of the judicial outcomes.