Definition
Doing Business compiles procedural requirements for exporting and importing a standardized cargo of goods by ocean transport. Documents associated with every official precedure are counted—from the contractual agreement between the 2 parties to the delivery of goods—along with the time and cost necessary for completion. For exporting goods, procedures range from packing the goods at the warehouse to their departure from the port of exit. For importing goods, procedures range from the vessel’s arrival at the port of entry to the cargo’s delivery at the warehouse. The time and cost for ocean transport are not included. Payment is made by letter of credit, and the time, cost and documents required for the issuance or advising of a letter of credit are taken into account. The ranking on the ease of trading across borders is the simple average of the percentile rankings on its component indicators.
Local freight forwarders, shipping lines, customs brokers, port officials and banks provide information on required documents and cost as well as the time to complete each procedure. To make the data comparable across economies, several assumptions about the business and the traded goods are used.
Assumption about the business
The business:
- Has at least 60 employees.
- Is located in the economy’s largest business city.
- Is a private, limited liability company. It does not operate in 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.
- Assumption about the trade goods
The traded product travels in a drycargo, 20-foot, full container load. It weighs 10 tons and is valued at $20,000. The product:
- Is not hazardous nor does it include military items.
- Does not require refrigeration or any other special environment.
- Does not require any special phytosanitary or environmental safety standards other than accepted international standards.
- Is one of the economy’s leading export or import products.
