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All
Risk
All Risks Coverage, a type of marine insurance, is the broadest
kind of standard coverage, but excludes damage caused by war, strikes,
and riots.
Alongside
A phrase referring to the side of a ship. Goods to be delivered
alongside are to be placed on the dock or lighter within reach of
the transport ship's tackle so that they can be loaded aboard the
ship. Goods are delivered to the port of embarkation, but without
loading fees.
Bill of Lading (B/L)
Bills of lading are contracts between the owner of the goods and
the carrier. There are two types. A straight bill of lading is nonnegotiable.
A negotiable or shipper's order bill of lading can be bought, sold,
or traded while goods are in transit and is used for many types
of financing transactions. The customer usually needs the original
or a copy as proof of ownership to take possession of the goods.
Bonded Warehouse
The Customs Service authorises bonded warehouses for storage or
manufacture of goods on which payment of duties is deferred until
the goods enter the Customs Territory. The goods are not subject
to duties if reshipped to foreign points.
Breakbulk Vessel
A general cargo vessel designed to efficiently handle un-containerised
cargo. Vessels are usually self-sustaining in that they have their
own loading and unloading machinery.
CAF(Currency Adjustment Factor)
A freight surcharge or adjustment factor imposed by an international
carrier to offset foreign currency fluctuations. In some cases an
emergency currency adjustment factor (ECAF) may be applied when
a charge or rate has been originally published in a currency that
is experiencing sustained or rapid decline. The CAF is charged as
a percentage of the freight.
Carnet
A customs document permitting the holder to carry or send merchandise
temporarily into certain foreign countries for display, domonstration
or other purposes without paying import duties or posting bonds.
Clean Bill of Lading
A receipt for goods issued by a carrier with an indication that
the goods were received in apparent good order and condition, without
damages or other irregularities.
Commercial Invoice
The commercial invoice is a bill for the goods from the seller to
the buyer. These invoices are often used by governments to determine
the true value of goods for the assessment of customs duties and
are also used to prepare consular documentation. Governments using
the commercial invoice to control imports often specify its form,
content, number of copies, language to be used, and other characteristics.
Consignee
The person or firm named in a freight contract to whom goods have
been consigned or turned over. For export control purposes, the
documentation differentiates between an intermediate consignee and
an ultimate consignee.
Consignment
Delivery of merchandise from an exporter (the consignor) to an agent
(the consignee) under agreement that the agent sell the merchandise
for the account of the exporter. The consignor retains title to
the goods until sold. The consignee sells the goods for commission
and remits the net proceeds to the consignor.
Cost and Freight (C&F)
Cost
and Freight (CFR) to a named overseas port of import. Under this
term, the seller quotes a price for the goods that includes the
cost of transportation to the named point of debarkation. The cost
of insurance is left to the buyer's account. (Typically used for
ocean shipments only. CPT, or carriage paid to, is a term used for
shipment by modes other than water.) Also, a method of import valuation
that includes insurance and freight charges with the merchandise
values.
Cost, Insurance and Freight (CIF)
Cost, insurance, and freight (CIF) to a named overseas port of import.
Under this term, the seller quotes a price for the goods (including
insurance), all transportation, and miscellaneous charges to the
point of debarkation for the vessel. (Typically used for ocean shipments
only. CIP, or carriage and insurance paid to, is a term used for
shipment by modes other than water.)
DDP
While the term "Ex Works" signifies the seller's minimum
obligation, the term "DDP - Deliver Duty Paid", when followed
by words naming the buyer's premises, denotes the other extreme
-- the seller's maximum obligation. The term "Deliver Duty
Paid" may be used irrespective of the mode of transport. If
the parties wish that the seller should clear the goods for import
but that some of the cost payable upon the import of the goods should
be excluded -- such as value added tax (GST) and/or other similar
taxes -- this should be made clear by adding words to this effect
(e.g., "exclusive of GST and/or taxes").
DDU
Deliver Duty Unpaid, referring to DDP except buyer pays for the
import duty.
Delivery Instructions
Provides specific information to the inland carrier concerning the
arrangement made by the forwarder to deliver the merchandise to
the particular pier or steamship line. Not to be confused with Delivery
Order which is used for import cargo.
Demurrage
Excess time taken for loading or unloading a vessel, thus causing
delay of scheduled departure. Demurrage refers only to situations
in which the charter or shipper, rather than the vessel's operator,
is at fault.
Duty
A tax imposed on imports by the customs authority of a country.
Duties are generally based on the value of the goods (ad valorem
duties), some other factors such as weight or quantity (specific
duties), or a combination of value and other factors (compound duties).
Ex Works (...named place) (EXW)
A term of sale in which for the quoted price, the seller merely
makes the goods avaliable to the buyer at the seller's "named
place" of business. This trade term places the greatest responsibility
on the buyer and minimum obligations on the seller. The Ex Works
term is often used when making an initial quotation for the sale
of goods without any costs included.
FCL or CY
Full Container Load, also known as CY. CY is the abbreviation of
Container Yard. When the term CY to CY, it means full container
load all the way from origin to destination.
Federal Maritime Commission
The FMC is an independent agencys which regulates oceanborne transportation
in the foreign commerce and in the domestic offshore trade of the
United States.
Flat Rack Containers
Especially for heavy loads and over-dimensional cargo. Containers
do not have sides or a top. This allows easy fork-lift and crane
access.
Free
Alongside Ship
Free Alongside Ship, FAS, at a named port of export. Under FAS,
the seller quotes a price for the goods that includes charges for
delivery of the goods alongside a vessel at the port of departure.
The seller handles the cost of unloading and wharfage; loading,
ocean transportation, and insurance are left to the buyer. FAS is
also a method of export and import valuation.
Free Carrier (FCA)
Free Carrier, FCA, to a named place. This term replaces the former
"FOB named inland port" to designate the seller's responsibility
for the cost of loading goods at the named shipping point. It may
be used for multimodal transport, container stations, and any mode
of transport, including air.
Free On Board (FOB)
Common price term used in international trade meaning seller's responsible
for the cost of goods is to the point of loading it to the vessel
deck or aircraft loading deck. The risk of loss of or damage to
the goods is transferred from the seller to the buyer when the goods
have been so delivered. FOB normally comes with port of loading
either airport or sea port.
Freight for All Kinds (FAK)
FAK is a shipping classification. Goods classified FAK are usually
charged higher rates than those marked with a specific classification
and are frequently in a container which includes various classes
of cargo.
Freight Carriage ... paid to
Like C & F, "Freight/Carriage paid to ..." means that
the seller pays the freight for the carriage of the goods to the
named destination. However, the risk of loss of or damage to the
goods, as well as of any cost increases, is transferred from the
seller to the buyer when the goods have been delivered into the
custody of the first carrier and not at the ship's rail. The term
can be used for all modes of transport including multi-modal operations
and container or "roll on-roll off" traffic by trailer
and ferries. When the seller has to furnish a bill of lading, waybill
or carrier's receipt, he duly fulfills this obligation by presenting
such a document issued by the person with whom he has contracted
for carriage to the named destination.
Freight Carriage ... and Insurance paid to
This term is the same as "Freight/Carriage Paid to ..."
but with the addition that the seller has to procure transport insurance
against the risk of loss of damage to the goods during the carriage.
The seller contracts with the insurer and pays the insurance premium.
Freight Forwarder
An independent business which handles export shipments for compensation.
At the request of the shipper, the forwarder makes the actual arrangements
and provides the necessary services for expediting the shipment
to its overseas destination. The forwarder takes care of all documentation
needed to move the shipment from origin to destination, making up
and assembling the necessary documentation for submission to the
bank in the exporter's name. The forwarder arranges for cargo insurance,
makes the necessary overseas communications, and advises the shipper
on overseas requirements of marking and labeling.
Gateway
In the context of travel activities, gateway refers to a major airport
or seaport. Internationally, gateway can also mean the port where
customs clearance takes place.
Import License
A document required and issued by some national governments authorising
the importation of goods.Also referred as import permit. With such
documentation, customs clearance can be conducted.
Incoterms
Maintained by the International Chamber of Commerce (ICC), this
codification of terms is used in foreign trade contracts to define
which parties incur the costs and at what specific point the costs
are incurred.
Insurance
Certificate
This certificate is used to assure the consignee that insurance
is provided to cover loss of or damage to the cargo while in transit.
Integrated Carriers
Carriers that have both air and ground fleets; or other combinations,
such as sea, rail, and truck. Since they usually handle thousands
of small parcels an hour, they are less expensive and offer more
diverse services than regular carriers.
Intermediate Consignee
An intermediate consignee is the bank, forwarding agent, or other
intermediary (if any) that acts in a foreign country as an agent
for the exporter, the purchaser, or the ultimate consignee, for
the purpose of effecting delivery of the export to the ultimate
consignee.
Intermodal
Movement of goods by more than one mode of transport, ie. airplane,
truck, railroad and ship.
Irrevocable Letter of Credit
A letter of credit in which the specified payment is guaranteed
by the issuing bank if all terms and conditions are met by the drawee.
It is as good as the issuing bank.
LCL
Less than Container Load, consolidated container load.
Letter of Credit
A financial document issued by a bank at the request of the consignee
guaranteeing payment to the shipper for cargo if certain terms and
conditions are fulfilled. Normally it contains a brief description
of the goods, documents required, a shipping date, and an expiration
date after which payment will no longer be made. An Irrevocable
Letter of Credit is one which obligates the issuing bank to pay
the exporter when all terms and conditions of the letter of credit
have been met. None of the terms and conditions may be changed without
the consent of all parties to the letter of credit. A Revocable
Letter of Credit is subject to possible recall or amendment at the
option of the applicant, without the approval of the beneficiary.
A Confirmed Letter of Credit is issued by a foreign bank with its
validity confirmed by a U.S. bank. An exporter who requires a confirmed
letter of credit from the buyer is assured payment from the U.S.
bank in case the foreign buyer or bank defaults. A Documentary Letter
of Credit is one for which the issuing bank stipulates that certain
documents must accompany a draft. The documents assure the applicant
(importer) that the merchandise has been shipped and that title
to the goods has been transferred to the importer.
Marine Cargo Insurance
Broadly, insurance covering loss of, or damage to, goods at sea.
Marine insurance typically compensates the owner of merchandise
for losses in excess of those which can be legally recovered from
the carrier that are sustained from fire, shipwreck, piracy, and
various other causes. Three of the most common types of marine insurance
coverage are "free of particular average" (f.p.a.), "with
average" (w.a.), and "All Risks Coverage."
Packing List
A shipping document issued by shipper to carrier, Customs and consignee
serving the purposes of identifying detail information of package
count, products count, measurement of each package, weight of each
package, etc.
Pro Forma Invoice
An invoice provided by a supplier prior to the shipment of merchandise,
informing the buyer of the kinds and quantities of goods to be sent,
their value, and important specifications (weight, size, and similar
characteristics). When an importer applys for Letter of Credit as
the means of payment, a Pro Forma Invoice from the beneficiary of
such Letter of Credit, usually the exporter, is required by the
L/C issuing bank.
Project Cargo
This is a term normal referred to when shipping cargo air or sea,
which does not fall within standard methods. i.e. over-height, or
oversize cargo which requires special equipment and handle.
Roll-on, Roll-off (RORO)
A type of ship designed to load & discharge cargo which rolls
on wheels or tracks.
Shipping Mark
The letters, numbers or other symbols placed on the outside of cargo
to facilitate identification.
Shipping Weight
Shipping weight represents the gross weight in kilograms of shipments,
including the weight of moisture content, wrappings, crates, boxes,
and containers (other than cargo vans and similar substantial outer
containers).
Tare Weight
The weight of a container and/or packing materials without the weight
of the goods it contains.
Through Bill of Lading
A single bill of lading covering receipt of the cargo at the point
of origin for delivery to the ultimate consignee, using two or more
modes of transportation.
Transshipment
Transshipment refers to the act of sending an exported product through
an intermediate country before routing it to the country intended
to be its final destination.
Twenty-Foot Equivalent Unit (TEU)
TEU is a measure of a ship's cargo-carrying capacity. One TEU measures
twenty feet by eight feet by eight feet -- the dimensions of a standard
twenty-foot container. An FEU equals two TEUs.
Ultimate Consignee
The ultimate consignee is the person located abroad who is the true
party in interest, receiving the export for the designated end-use.
Value for Customs Purposes Only
The U.S. Customs Service defines "value for Customs purposes
only" as the value submitted on the entry documentation by
the importer which may or may not reflect information from the manufacturer
but in no way reflects Customs appraisement of the merchandise.
War/Strike Clause
An insurance provision that covers loss due to war and/or strike.
Wharfage
A charge assessed by a pier or dock owner for handling incoming
or outgoing cargo.
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