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Business gateway - Business terms
Category: Business and Law > Business
Date & country: 21/01/2010, UK
Words: 759

This is a long-term loan to a company, usually at a fixed rate of interest and for a specific term. Debenture holders are creditors of the company. A debenture normally contains a fixed charge over a specific asset or assets of the company and/or a floating charge over the company's general assets, eg stock. In the event of insolvency, fixed charge...

Debt to equity ratio
A measure of the gearing of a business, calculated as long-term debt divided by shareholder funds. Banks are very reluctant to lend money to businesses that are highly geared.

Someone who owes money.

The person legally responsible for the accuracy of the information given in a declaration to customs. This includes the accuracy of any supporting documents relating to the declaration.

A declaration made in the appropriate form to customs indicating the intention of the declarant to declare goods to the export or import procedure.

A document that is formally signed, sealed and delivered. Contract under seal and specialty contracts are other names for deeds. Unlike normal contracts they are enforceable even though they are one sided, ie the person making the deed does not get any consideration in return. A promise or gift that is not given under a deed and not for any mutual ...

Deed of Gift
A legal document which transfers ownership of the special stamp to customs whilst local export control (LEC) traders retain the stamp for authenticating community transit (CT) documents.

Deferment approval number (DAN)
A unique reference number issued to a trader by the central deferment office, part of HM Revenue & Customs (HMRC), to identify the trader's duty deferment account.

Deferment trader
A trader who is approved by HM Revenue & Customs (HMRC) to defer the payment of tax and duties. Conditions apply.

Deferred premium
The part of a premium which, following agreement with the insurer, is payable by monthly, quarterly or half-yearly instalments.

A decline in the general level of prices in the economy.

Department for Environment, Food and Rural Affairs -The UK government department tasked with issues such as the environment, rural development, the countryside, wildlife, animal welfare and sustainable development.

Depositor in warehouse
The person bound by the declaration placing the goods under the customs warehousing procedure or to whom the rights and obligations of such a person have been transferred.

Allows fixed assets - or capital equipment such as cars or computer equipment - to be written off over several years. A piece of machinery bought for £330,000 in 2000 and depreciated, or written off over three years has no value in the accounts after 2003, but has appeared as a £110,000 cost in each of the years in between. This does not reflect th...

A financial contract with a value linked to the expected future price movements of the asset it is linked to - such as a share or a currency.

Designated export place (DEP)
This is a customs-approved inland location where certain export procedures (full and simplified declaration procedures, low-value and statistical declarations) may be used and where all customs declaration must be made electronically to the Customs Handling of Import and Export Freight (CHIEF) system.

In the context of trade within the European Union (EU), the removal of goods from the UK and their acquisition in another EU member state by a person registered for VAT in that state.

Digital rights management
Software-based technologies aimed at protecting the copyright of data available via the Internet, by enabling secure distribution and/or disabling illegal distribution of the data. Digital rights management protects intellectual property by either encrypting the data so that it can only be accessed by authorised users or marking the content with a ...

Digital signature
The process of adding an electronic marker to the information to validate both the content and the originator of the data. Digital signatures are easily transportable, cannot be imitated by someone else, and can be automatically time-stamped. The ability to ensure that the original signed message arrived means that the sender cannot easily refuse t...

Direct export
Refers to goods exported directly from the UK to a non-European Union (EU) country.

Direct representative
A third party who makes a customs declaration in a trader's name, on the trader's behalf.

Direct trader input (DTI-CHIEF)
An arrangement under which traders can input data from their own computer terminals to the Customs Handling of Import and Export Freight (CHIEF) system via a trade system operator.

Legal executives of a company. They take management decisions in board meetings. Directors are personally responsible for delivering accounts and the annual return on time. They also ensure that the registered office address is current and attended.

Discharge consent
A discharge consent is a permit issued by the Environment Agency (EA) or the Scottish Environment Protection Agency (SEPA) that allows you to discharge certain matter into controlled waters subject to strict conditions.

A written document denying legal responsibility, or a limitation of rights that might otherwise be claimed.

A means of raising money against the value of unpaid invoices. A discounter will buy invoices at a discount from their face value, hoping to make a profit on redemption.

Distance selling
When a taxable person registered in one European Union (EU) member state supplies and delivers goods to a non-taxable person in another EU member state (most common in mail order).

Distiller's warehouse
An excise warehouse approved by HM Revenue & Customs (HMRC) under Section 15 of the Alcoholic Liquor Duties Act 1979, for the storage of the spirits produced at a distillery. A limited range of operations, such as racking, can be carried out in a distiller's warehouse.

The legal process which allows HM Revenue & Customs (HMRC) to take (the legal term is 'seize') a taxpayer's possessions and, if necessary, sell them to settle a debt owed to HMRC.

Overseas agent which sells for a supplier directly and maintains an inventory of the supplier's products.

A payment to shareholders as a return on their investment in the form of cash, stock, or property. Dividends are declared from operating surplus. Dividend is also a term used by a licenced insolvency practitioner to describe the distribution of assets of an insolvent estate to the creditors of the insolvent business.

Documentary collection
Where you draw up a bill of exchange, which allows you to keep control of your goods and raise additional finance. An overseas bank, acting on your bank's behalf, will only release the documents necessary for your customer to take possession of goods once it formally accepts the terms of the bill. Documentary collections are typically used for expo...

Documentary credits
Letters of credit are the most secure method of payment (other than payment in advance). Your customer arranges a letter of credit with its bank, which then pays a corresponding bank in the UK - the advising bank - once you submit all the necessary documentation.

Documentary proof of origin (DPO)
An accurate and authentic 'irrevocable' letter of credit, verified by your bank, carries little credit risk. Documentary credits are typically used for exports to customers you have not sold to before, and for customers and countries that present particular credit risks.

Domain name
The unique name that identifies a website, and is also used to describe the name to the right of the @ sign in an email address, eg and

Domain Name System (DNS)
The mechanism used to convert a website domain name to the unique IP address of the server it is housed on. This allows users to locate a remote server by its name, which is easier to remember than its somewhat obscure IP address that is made up of digits. You will often see the IP address displayed by your browser when you are connecting to a part...

A Plant Health Inspectorate (PHI) computer system for recording, processing and reporting inspections.

Repayment of duty or other taxes paid on goods satisfying certain conditions. The most common forms of drawback relate to excise duty paid on goods which are subsequently removed from the UK (whether to another European Union (EU) member state or to a destination outside the EU) supplied as ship's or aircraft's stores or used in the manufacture of ...

Due diligence
The formal process of taking all reasonable steps when investigating the background of a business being bought or of another party in a major long-term contract. Used to ensure that there are no hidden details that could affect the deal.

There are two main types of duty collected by HM Revenue & Customs (HMRC) - one is import duty, which is duty charged on goods imported into the European Union (EU) and the other is excise duty, which is a UK tax on certain types of goods, such as alcohol or tobacco.

Duty and tax
Customs duty, Common Agricultural Policy (CAP) charges, excise duty and VAT, as applicable.

Duty of care for health and safety
Both you and anyone on your premises have a duty of care to protect their health and safety. This means that you must take reasonable precautions to avoid acts which could forseeably cause harm to people.

Duty of care for waste
The duty of care is a law that states that you must take all reasonable steps to ensure that waste is managed responsibly. If you give waste to someone else you must be sure they are authorised to take it and can transport, recycle or dispose of it safely.

Duty of disclosure
Obligation placed on someone taking out insurance, to inform insurers of anything that could influence either their judgment on whether the risk is acceptable, or the terms to be offered.

Duty paid terminal
An oils terminal where all of the oils in storage have borne excise duty.

Duty point
The time and place where excise duty becomes payable.

Duty representative
A person authorised and registered by HM Revenue & Customs (HMRC) to act as an agent for non-UK owners of excise goods who wish to deposit goods in a UK excise warehouse.

Duty suspension
An arrangement which allows excise goods to be produced, processed, held, received and dispatched without payment of duty. The duty chargeable on the goods is held in suspense. Duty suspension ends when the goods reach a legal point, ie the 'excise duty point', at which the duty becomes due.

Duty-suspended installation
A warehouse, where oils are stored in duty suspension before delivery to home use. These are normally attached to the producer's premises, or are import warehouses. These premises used to be referred to as bonded warehouses.

Electronic Applications for Phytosanitary Certificates -A system developed for the Plant Health Inspectorate to provide for the electronic delivery and processing of interactive application forms for export certificates for plants and plant products.

Earnings per share (EPS)
The earnings of a company over a defined period, divided by the number of ordinary shares it has issued.

An Ecolabel is awarded to products that meet strict criteria to prove that they minimise their impact on the environment. The Ecolabel is a voluntary instrument to encourage the development of greener products.

Electronic data interchange for administration, commerce and transport -Electronic Data Interchange for Administration, Commerce and Transport - an EDIFACT message is the basic unit for communicating information electronically. For example, a Supplementary Declaration is submitted as a Customs Declaration.

Electronic data interchange (EDI)
The method of exchanging messages between computer systems over an electronic communications network nationally and internationally.

Electronic Point of Sale (EPOS)
Electronic Point of Sale equipment such as electronic tills.

Eligible goods excise
Goods on which excise drawback may be claimed.

Employers' liability insurance
Insurance for employers in respect of their liability to employees for injury or disease arising out of, and in the course of, their employment. With some exemptions this insurance is compulsory in England, Scotland, Wales and Northern Ireland and can only be provided by an authorised insurer.

When a building or some portion of it, or a wall or fence, extends beyond the land of the owner and illegally intrudes upon that of an adjoining owner.

Scrambling information to prevent unauthorised disclosure or modification using mathematical techniques. Techniques normally use an encryption algorithm with a key to ensure that only the intended recipient can read the information.

End use
Arrangements which allow certain imported goods to be declared for free circulation in the European Union at a reduced or nil rate of duty, provided they are put to a prescribed use under Customs control.

Enforcement notices
Enforcement notices are issued by the environmental regulator if breach of a consent has occurred, or is likely to occur.

Enterprise Resource Planning (ERP)
A software system that handles all of a business' departments and functions in one seamless process. It will typically incorporate fully integrated packaged software applications, including product planning, purchasing parts, maintaining inventories, interacting with suppliers, providing customer service, and tracking orders.

Enterprise resource planning (ERP)
Computer software which unifies all the key systems, processes and data held by a business to streamline processes, reduce costs and achieve greater integration.

Entitled destinations
Destinations within the European Union eligible to receive Common Agricultural Policy (CAP) export refunds.

Entitled passenger
A person travelling by sea or air to a country outside the fiscal/Customs territory of the European Union and in possession of a valid transport document.

Entitled vessel
A vessel with authority from HM Revenue & Customs (HMRC) to receive duty-free stores.

A declaration and request for customs release in respect of imports or goods intended for export. It is usually made on a single administrative document (SAD). Traders approved to do so can submit entries electronically.

Entry processing point (EPP)
A customs office that partially processes entries but does not have the full facilities of an entry processing unit (EPU).

Entry Processing Unit (EPU)
A HM Revenue & Customs (HMRC) and excise entry processing unit (EPU) where import, export and duty payment documents are processed.

Environment Agency (EA)
The Environment Agency is the main regulatory and enforcement authority for environmental matters in England and Wales. It is responsible for matters concerning waste regulation, water quality including pollution prevention and regulating the emissions from most large industrial and manufacturing processes.

Environmental Health Officer (EHO)
EHOs are the officers who undertake the duties of the enforcement authority (local authorities) responsible for health and safety for some premises including offices, retail premises, food premises, exhibition premises and some warehousing. EHOs also have environmental responsibilities such as dealing with air pollution problems and noise nuisance.

These are the ordinary shares of publicly quoted companies.

The value of something, such as a house, less any money owing on it.

Legal concept that a person can be stopped from denying something that they allowed another person to believe. In contract this may apply where a person enters into an agreement making statements which are not not true. If the other party has acted on those statements and would lose out if they proved to be false, then the person making the stateme...

A local area network protocol supporting the connection of devices such as computers, printers, workstations, terminals and servers within the same office or building.

The European currency unit used by thirteen members of the European Union: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain and Slovenia, all of which have joined Economic and Monetary Union (EMU) and now use the Euro in place of their old national currencies. From 1 January 2008, the euro...

US dollars deposited in Europe.

European Commission (EC)
One of the three main governing bodies of the European Union (EU). The Commission drafts proposals and is responsible for implementing policy. It is also responsible for ensuring that EU legislation is carried out.

European Community (EC)
European Community (EC) and European Economic Community (EEC) are now referred to as the European Union (EU).

European sales lists (ESL)
All businesses registered for VAT that supply goods to businesses registered for VAT in other European Union (EU) member states must send HM Revenue & Customs (HMRC) lists of their EU supplies. Other member states use the information provided on the European sales lists (ESL) to ensure VAT has been correctly accounted for.

European Union (EU)
An economic association of European countries founded by the Treaty of Rome in 1957 as a common market. It was known as the European Community (EC) before 1993. The European Union (EU) member states are: Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembou...

European Waste Catalogue
The European Waste Catalogue has been produced by the European Union to allow those dealing with waste to identify it accurately. It is used in duty of care for waste documentation. The Catalogue also identifies wastes that should be classified as hazardous.

The dispossession of a tenant of leased property by force or through the legal process.

Ex gratia
Payment made 'as a favour' by an insurer, when there is no obligation under the policy terms.

Ex work (EXW)
An Incoterm, where the seller makes the goods available to the buyer at their own premises or another named place. The buyer assumes all the costs and risks of clearing the goods for export and loading and transporting the goods.

Excess (or deductible)
Specified initial amount of a claim that the insured has to contribute. If a claim is less than the excess stated in the policy, no payment is made by the insurers. Excesses do not apply to Employers' Liability Compulsory Insurance, as the insurer is responsible for any payments due to the employee.

The exchange of agreed, signed contracts. The transaction between the seller and the buyer is then legally binding, and completion - including the final transfer of money - usually takes place two to four weeks later.

Exchange rate
This is the value of one currency compared to another.

Excise Duty
A UK duty charged on both UK produced and imported goods. Goods subject to excise duty include beer, wine, spirits and other alcoholic drinks, hydrocarbon oils (including fuel oil), and tobacco goods. The rate of duty is set separately for each product.

Excise goods
Goods, other than chewing tobacco, which are chargeable with a duty of excise by or under the Alcoholic Liquor Duties Act 1979, the Hydrocarbon Oils Duties Act 1979 or the Tobacco Products Act 1979.

Excise warehouse
A warehouse authorised by HM Revenue & Customs (HMRC) for the deposit, without payment of duty, of goods liable to excise duty. There are special requirements for premises for the storage of oil.

Exclusion (or exception)
An event or circumstances specifically excluded from the terms of an insurance policy.

Exclusion clauses
A type of exemption clause in a contract that is intended to exclude one party from liability if a particular circumstance occurs. The courts tend to interpret exclusion clauses strictly and where possible in favour of the party that did not write them. Exclusion clauses are governed by regulations in consumer dealings that make most of them ineffe...

Exempt persons
Importers who are not registered for VAT or registered taxable persons who are re-importing goods other than in the course of their business.

Exemption clauses
Clauses in a contract that try to restrict the liability of the party that writes them. They are split into exclusion clauses that try to exclude liability for specified outcomes completely and limitation clauses that try to set a maximum on the amount of damages the party may have to pay if there is a failure of some part of the contract. Exemptio...

Movement of goods from the UK to a destination outside the European Union. This includes the Channel Islands.

Export house
Intermediary organisation between an exporter and a buyer.

Export invoice
Part of the documentation needed if you ship your goods abroad. It should contain a full description of your goods, their price, weight and country of origin.

Export licence
Government document legally required for the export of certain goods such as pharmaceuticals, chemicals and munitions. It's the exporter's responsibility to obtain a licence if necessary.

Export packing list
This is attached to the outside of the package to be shipped and specifies the weight, volume and type of cargo.