ATA CARNET/Temporary shipment certificate

An ATA Carnet, a. k. a., "Merchandise Passport," is a document that facilitates the temporary importation of products into foreign countries by eliminating tariffs and value-added taxes (VAT) or the posting of a security deposit normally required at the time of importation.

Accessorial Charges

Charges that are applied to the base tariff rate or base contract rate, e.g., bunkers, container, currency, destination/delivery.

Alameda Corridor Surcharge

The Alameda Corridor was built to consolidate three main rail access routes between the Los Angeles-Long Beach harbor area and other intermodal rail yards inland. To maintain this corridor effectively, there is a charge called The Alameda Corridor Surcharge which is levied by the rail operators to the trade including OTIs, shippers, shipping lines.

Bill Of Lading

A bill of lading is a trade document issued by a shipping line or OTI to the customer. The bill of lading serves as Evidence of Contract of Carriage, Receipt of Goods, Document of Title to the Goods.

Booking Fee

This is a charge that may be levied by a freight broker as an administrative charge for selecting and booking cargo with a reputed carrier on behalf of the customer.

Bunker Adjustment Factor Surcharge (BAF)

The term "Bunker" refers to the fuel that is used to operate ships. Bunkering is the action of supplying a ship with bunkers. The ship operator is responsible for the payment of these bunkers to the bunker supplier.

Bunker Charge (BUC)

An extra charge sometimes added to steamship freight rates; justified by higher fuel costs. Also known as Fuel Adjustment Factor or FAF.

Cargo Data Declaration Fee

A surcharge assessed for the additional costs of declaring cargo information in advance to the European Union authorities as required for authorities to evaluate any potential security and safety threats.

Cargo Insurance

Any movement of cargo from one location to another involves some form of risk, be it the risk of damage, pilferage, theft of entire packages or non-delivery of the whole shipment.  Marine insurers charge cargo insurance premiums based on the type of coverage by the customer. Depending on the Inco-terms used, the insurance cost may be borne either by seller or the buyer.

Carrier Security Fee & Terminal Security Charge

The 9/11 attacks in the USA, changed many things for many people. The shipping and freight world was also affected in the aftermath of these attacks. Known as International Ship and Port Facility Security Code (ISPS) are implemented through International Convention for the Safety of Life at Sea (SOLAS), 1974 chapter XI-2 to enhance maritime security.

Chassis Usage Surcharge/Chassis Fee

Especially in the United States of America, it is customary for the carriers (shipping lines) to supply their own chassis to the exporters and importers. Chassis usage surcharge is a fee imposed for the use of a chassis in conjunction with the shipping container to facilitate overland transportation from the shipper’s door to port.

Congestion Surcharge

From time to time, certain ports around the world face congestion due to various reasons such as weather, political issues, strikes etc.

Consolidation Fee

Sometimes shippers may not have enough cargo to fill a container for export globally.

Container Cleaning Fee

The business of global trade in container covers many commodities.

Container Freight Station (CFS)

CFS (Container Freight Station) refers to a warehouse where goods belonging to various exporters or importers are consolidated (grouped) or deconsolidated (degrouped) before being exported or after being imported.

Container Fumigation Fee

Fumigation of shipping containers are usually a standard protocol for many countries. Fumigation is done to ensure pests do not enter or leave a country in order to prevent diseases.

Currency Adjustment Factor (CAF)

Currency Adjustment Factor (CAF) is a charge levied by some of the shipping lines on some of the trade lanes to cover Currency Fluctuation financial losses. The quantum of CAF could be on percentage basis or per container basis.

 Customs Bond

In any country, cargo must be cleared with customs authorities before release. In some cases, the importer may not have the necessary funds to pay the duty in full and clear the goods, the importer can clear the goods under bond which effectively means they enter into an agreement with customs that they will pay duties and taxes in a timely manner.

Customs Clearance Fee

A customs clearance fee is a charge levied by the customs broker in order to handle the customs clearance.

Customs Duty

Customs duty is a charge levied by the customs and excise department of a country on any goods that are imported or in some cases exported.

Delivery Fee

Delivery fee as the name suggests is a fee that is charged prior to the cargo being delivered to the customer.

Demurrage/Detention

Demurrage, is a charge levied by the shipping line to the importer in cases where they have not taken delivery of the full container and move it out of the port/terminal area for unpacking within the allowed free days.

Destination Delivery Charge (DDC)

Abbreviation for “Destination Delivery Charge.” A charge, based on container size, that is applied in many tariffs to cargo. This charge is considered accessorial and is added to the base ocean freight. This charge covers crane lifts off.

Emergency Bunker Surcharge (EBS)

Abbreviation for “Emergency Bunker Surcharge.” A surcharge added to the cost of freight to cover fuel costs.

Environment Fee Destination

Environmental surcharges imposed by the destination port. Covers various contingencies such as hydrocarbon spill cleanup costs and other mandated fees.

FCL Container

FCL is the abbreviation for Full Container Load. FCL container is the most common container service type used in global shipping transport today.

Freight Claim

A freight claim is equal to or more than the value of the goods damaged or lost.

Freight Container Pallet Box Dimensions

These are the standard dimensions of boxes, pallets and freight containers that are used in shipping.

General Rate Increase (GRI)

Abbreviation for “General Rate Increase.” Used to describe an across–the–board tariff rate increase implemented by conference members and applied to base rates.

Harbor Maintenance Fee (HMF)

Harbor Maintenance Fee (HMF) is a fee levied by the US Customs and Border Protection unit and is collected on all import shipments.

Importer Security Filing (ISF) Filing Fee

ISF or Import Security Filing is a term used in shipments moving into the United States of America by an ocean going vessel.

ISF Requirements: The importer or their agent is required to electronically submit information relating to the shipment such as shipper, commodity details, package details, weight etc. This information must be submitted in advance before the cargo arrives in USA.

ISF filing responsibility: This import security filing information is usually prepared by the importer’s agent (customs isf broker or freight forwarder) and submitted to the US CBP unit.

ISF Filing Penalty: The agent submitting this information must prepare the information accurately and truthfully as any issues with the filing form could attract huge penalties and may even go to the extent of the cargo not being discharged.

Incoterm

The incoterms define the role between seller and buyer at an international transaction. Who has to do what en at what time? In the contract between the seller and the buyer, the following is determined:

  1. The duties of the buyer and the seller
  2. Who takes care of the insurances, licences, permissions and all other formalities
  3. Who arranges the transport untill which point and who is responsible for this
  4. The point where the costs and risks pass on from the seller to the buyer.

Key Freight Documents

Freight shipments involve a lot of work and most of the work in a freight shipment involves documents.

Several key freight documents involved in a shipment and some of the most important ones are:

  • Commercial invoice
  • Packing list
  • Certificate of origin
  • Freight invoice
  • Bill of lading
  • Booking note
  • Forwarders cargo receipt
  • Manifest
  • Hazardous declaration

LCL Cargo

LCL is the abbreviation for Less than Container Load. In an LCL shipment, multiple LCL cargoes belonging to multiple shippers and consignees are packed into a single container for shipment.

Merchandise Processing Fee

Merchandise Processing Fee (MPF) is a fee that is levied on an importer at the time of processing the entry with the US Customs and Border Protection unit.

Ocean Transportation Intermediary (OTI)

A freight intermediary (also known as an OTI or Ocean Transportation Intermediary) is someone that assists an exporter or an importer to secure the best freight rates possible while providing the quickest routing for their cargoes and also.

Panama Transit Fee

The Panama Canal is a canal of approximately 80 kms long created to shorten the transit time of ships going from the Atlantic Ocean to the Pacific Ocean. The shipping lines using this canal have to pay the Panama Canal Authority and part of that cost is levied by the shipping line to the customer as a Panama Transit Fee or Panama Canal Surcharge.

Peak Season Surcharge

Taking advantage of this peak season rush while also ensuring service reliability and efficiency, the shipping lines impose a surcharge known as Peak Season Surcharge which is paid by the importer or exporter. Specially between June and October of every year, cargo movement between the main trade lanes Asia/Europe and Asia/America peaks, in preparation of the holiday seasons.

Pickup Fee

Pickup fee usually is the charge levied by a transporter for the picking up of a container from an empty depot and moving it to the shippers warehouse or packing warehouse for the packing of export cargo.

Pierpass Charge

Pierpass charge is a Traffic Mitigation Fee (TMF) charged for containers that are moved during peak hours of Monday through Friday, 3 a.m. to 6 p.m at the Los Angeles and Long Beach ports.

Port Storage

All ports around the world offer a certain free period (maybe 3-7 days) to allow import customers time to process import requirements and take delivery of the import containers from the port of discharge or terminal.

Security Surcharge

The shipping lines charge a Security Surcharge (also known as ISPS surcharge) to place appropriate security officers/personnel on each ship.

Shipper’s Letter of Instruction

The shipper’s letter of instruction is issued by the exporter to the forwarding agent and includes shipping instructions for air or ocean shipment.

TAD (Transit Accompanying Document)

Abbreviation for “Transit Accompanying Document.” A document accompanying uncleared goods during transit from one authorized location to another.

Telex Release Fee & Telex release

A Telex release is a message that is sent by the origin port agent of a shipping line or OTI (NVOCC or Freight Forwarder) to their destination port agent confirming that one or all of the original telex bill of.

Traffic Mitigation Fee

The Traffic Mitigation Fee pays for the night shifts and Saturday shifts and is designed to compensate for the daytime congestion in and around these ports.

 Unpacking Charges

A fee that maybe charged by a 3rd party warehouse for the unpacking of the cargo from the container at their premises. If cargo is unpacked directly at the consignee’s premises, then this charge will not be applicable in this contract.

War Risk Surcharge

The shipping line operates ships globally carrying cargo from Point A to Point B. Sometimes, this transit could involve the transit through areas affected by war and other risk. This surcharge is levied to cover the insurance premiums for such passage and is usually charged along with the freight charges.

Warehouse Fees

Warehouse fees involves a few different set of fees because there are so many charges involved in a warehouse operation.

Wharfage

A charge assessed by a pier or dock owner against freight handled over the pier or dock or against a steamship company using the pier or dock.

What is a Minimum Quantity Commitment (MQC)?

A service contract is a contract between a BCO and VOCC where both parties agree to ship a specified volume of cargo at a specified and mutually agreed freight rate over a fixed period of time at a defined level of service.

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