Shipping Terms draft

A

Accessorial Charges are additional charges applied to the base tariff rate as bunkers, currency exchange, demurrage, detentions etc.

Acquiescence is accepting the Bill of Lading without protest by a shipper or shipper’s agent, the shipper is giving his consent.

Acquittance is a written receipt discharging from all claims.

Ad Valorem Latin term meaning “according to value.”, import duty of the cargo will be certain percentage of the goods value.

Advising Bank is a bank that handles letter of credit on behalf of foreign bank

Affreightment is contract between carrier and importer or exporter for specific commodity, price, and shipping time.

Agent is a person or company acting as broker and earning commission for his service.

Aggregate Shipment is numerous shipments consolidated and assign to one consignee and considered as one shipment.

Air Waybill is receipt for the freight issued from the forwarding agent or the carrier and stating the terms and the parties in the shipment.

All In is term showing the total transportation price from origin to destination.

AMS “Automated Manifest System.” The U.S. Customs’

Appraisement is dutiable value of imported goods determined by the US customs.

Arrival Notice is carrier notification of the consignee or notify party for ship arrival. The notify parties are listed in the Bill of Lading.

B

BAF or Bunker Adjustment Factor is shipping charge for the fuel fluctuating cost also known as fuel adjustment factor or FAF.

Bank Guarantee is letter issued by a bank to a shipping line as guarantee for lost or misplaced original negotiable bill of lading.

Base Rate is a standard rate without accessorial charges.

Beneficiary the party to whom the letter of credit is issued and money are paid.

Bill Of Lading B/L or BOL is contract between the shipper and the carrier for the freight stating the terms for the shipment and also acting as receipt for the freight.

Amended BOL is revised document requested by shipper or consignee

BOL Terms are indicating carrier duties and liabilities.

B/L’s Status defines weather freight input, rated, reconciled, printed, or released.

B/L’s Type: Original Bill of Lading, Non–negotiable, Revised B/L or Amended (AM) B/L.

Canceled BOL is stating shipper cancelation of the B/L.

Clean Bill of Lading is B/L declaring a defective condition of the freight or the packaging, usually not accepted by the buyer or the banks.

Combined BOL is issued for cargo shipped with different transportations.

Consolidated Bill of Lading is issued for numerous BOLs consolidated in single B/L.

Corrected B/L is stating financially related changes.

Express Bill of Lading requires no originals, paper or copies printed. It is Non–negotiable B/L.

House B/L is generated by consolidator or freight forwarder for a single shipment stating the goods being transported, names and addresses of the parties involved in the transaction.

Negotiable B/L can be bought, sold or traded while freight is in transit. Originals are required by the carrier in order to release the shipment.

Negotiable Bill of Lading is title of the merchandise, issued “to order to” and endorsement   is       required from the shipper for goods transfer.

Non–Negotiable BOL or also known as Straight B/L. Goods cannot be sold, bought or traded while cargo is in transit, most often the cargo has been prepaid.

Original B/L is the part of the OBL indicating the value.

Split B/L is issuing numerous BOLs deriving from a single B/L.

Bill of Sale is receipt for transfer of ownership of the cargo from one party to another in return for money paid.

Bill to Party is a party paying for the service.

Billed Weight is the invoiced, chargeable weight.

Blocking or Bracing is securing the cargo to prevent cargo shifting and damage.

Boat is small vessel for water traveling.

Bond Port is designated port of initial customs entry.

Bonded Freight is goods transported under a bond to U.S. Customs and transported under stated terms and conditions.

Bonded Warehouse is storage of goods authorized by Customs for which custom duties are postponed.

Booking is space and equipment reservation with a carrier for freight acceptance and carriage.

Break Bulk is non containerized cargo.

Broker is person arranging freight transportation for commission.

Bunker Charge is carrier compensation for fuel cost fluctuations. Also known as BAF Bunker Adjustment Factor or FAF Fuel Adjustment Factor.

C

C&F – Cost and Freight is defining terms of risk and cargo ownership transfer in the shipping process. Cost and Freight has been changed to Incoterms 2000.

CAF – Currency Adjustment Factor is surcharge for currency exchange fluctuation.

Cargo is merchandise, freight loaded on vessel.

Cargo Manifest is lists of all goods in customer shipment carried on vessel voyage.

Carnet is a document issued from customs, permitting transportation and crossing of international borders without paying duties or purchasing bonds.

Carrier is freight transportation party, which transport goods by rail, road, ocean and air.

Certificate of Origin is document indicating the origin of goods in international trade.

CFS – Container Freight Station is facility for loading and unloading containerized cargo.

Chassis is wheeled frame with locking devices on which container is transported.

CE is mark indicating European Union cargo standards for products imported in the EU.

CI – cost of insurance is based on the freight and transportation cost.

CIF Cost, Insurance, Freight

Classification is the process of proper number assignment on the goods for customs and statistical purposes.

Commercial Invoice – receipt for transaction between the exporter and the importer, indicating the goods value and description.

Consignee – shipping party, recipient of the cargo in the transaction.

Consignor – shipper in the bill of lading.

Consolidation – is the process of cargo shipping of several shippers to one destination under one bill of lading.

Container – metal box, used for goods transportation in international trade and transported on chassis, vessel and rail. Container may be 20’ Std, 40’ DV, 40’ HC, 45’, Reefer, Flat Rack, Open top, Platform, Tank.

Container Yard (CY)  is container storage facility, where the container are loaded or unloaded from the ship.

Customhouse Broker a licensed person or company, by the treasury department engaged customs goods clearance for the importer.

Customs Entry declaration made and duties paid by the importer for incoming foreign goods.

Cut–Off Time is the terminal deadline when the cargo can be delivered for loading on the ship.

D

D&H – “Dangerous and Hazardous” cargo.

DDC – Destination Delivery Charge is accessorial charge, based on container size and covering carne operations and movement of the container in the terminal.

Delivery Instructions – information for goods delivery issued by shipper.         

Demurrage – penalty charge invoiced to shipper or consignee for delaying the carrier’s equipment over the free time. The free time is stated in the shipping contract between the carrier and the freight forwarder or shipper.

Depot – Container terminal where empty containers can be pick up or dropped off..

Destination is the assigned shipping destination. Also destination is the place where cargo is handed to the consignee or agent.

Detention is carrier penalty charge billed to consignees or shippers for equipment (container) delaying over the allowed time. Detention applies to equipment, demurrage applies to cargo.

Diversion is the changing the shipping routing or the entire vessel.

Dock Receipt – document acknowledging receipt of cargo and description.

Door–to–Door is complete transportation service from shipper location to consignee facility.

Drayage is truck, inland transportation charge.

Dry Cargo is goods not requiring temperature control and not liquid.

Dunnage is material used for cargo protection and safety.

Dutiable Value the amount on which custom duties are calculated.

E

Empty Repo is transportation of empty containers.

Equipment Interchange Receipt (EIR) is a document for container transfer from one carrier, terminal to another.

ETA – Estimated Time of Arrival, is time when vessel is expected to errive at destination.

 Ex Dec is abbreviation for Shipper’s Export Declaration

Export is the process of goods transportation to a foreign country.

Export Declaration is official document declaring merchandise to be shipped to foreign country.

Export License is document or permit allowing export of designated goods to nominated destination.

EXW – Ex-Works Incoterm is cargo and risk transfer from seller to the buyer at seller premises.

F

FAK Freight All Kinds is general commodity description covered under one freight rate.

FAS – Free Alongside Ship is part of Incoterms when the seller is responsible for cargo clearance for export.

FCL – Full Container Load. is containerized cargo transportation, usually involves one shipper and consignee.

FD – Free Discharge

Feeder Service is vessel transportation between central transshipment ports to local ports.

FIO or FI / FO is abbreviation for free in and free out, it indicate only the ocean freight the shipper and consignee are responsible for terminal handling charges at origin and destination.

Flat Rack is container without side walls. Cargo can be side and top loaded.

FOB Freight On Board (Incoterms) the seller is responsible to deliver the cargo on vessel board. This is one of the most commonly miss used shipping term.

FOR Free on Rail

Freight Forwarder – agent acting on shipper or consignee behalf, facilitating cargo transportation.

Free Carrier (FCA) Incoterm of sale meaning the seller has delivered when the cargo is given to the carrier nominated by the buyer at the named place.

FPA Free of Particular Average is the most basic marine insurance. Payment will be process only under certain circumstances such as sinking, collision.

Free Out (FO) cargo recipient is responsible for terminal handling charges at destination.

G

GDSM General Department Store Merchandise. Commodity description that is included in the service contracts.

GRI General Rate Increase is used to indicate shipping freight rate increase.

Gross Weight summarized weight of truck,, chasse, container and freight for inland transportation. Generally, 80000 lbs for the entire summarized weight.

Groupage is consolidation service of several shipments into ocean container.

H

Harbor is any port where vessel can disembark.

Harmonized System of Codes (HS) is international system for goods classification applied to facilitate import and export duties and taxes.

Hazardous Materials HAZ MAT is commodity description for dangerous cargo. Describing explosive, radioactive, poisonous cargoes.

I

Import is the process of delivering goods from foreign country.

Import License document authorizing importation of goods.

In Bond is cargo transportation under customs control.

INCOTERMS is international set of rules for risk and commodity transfer between seller and buyer.

Inland Carrier cargo transportation by truck, rail or other vehicle between inland point and port.

Inspection Certificate a survey issued by independent agent, certifying the quality of the goods shipped.

Insurance Standard – this insurance coverage provides partial cargo protection for certain insurance clauses and in case of vessel sink, explosion, etc are fully covered.

Insurance, All–risk this type of insurance offers full coverage of the transported cargo while in transit.

Intermodal – containerized cargo transportation by truck rail and vessel.

 ISPS  – International Ship and Port Security Code is accessorial surcharge in ocean freight.

J

Jettison throwing equipment or cargo overboard when a ship is in danger

L