Glossary
Accessorial Charges: Charges in addition to the base tariff rate or base contract rate, e.g., bunkers, container, currency, destination/delivery.
Arrival Notice: A notification by carrier of ship’s arrival to the consignee, the Notify Party.
Bill of Lading (B/L): A document that establishes the contract for shipment between a shipper and a transportation company. It serves as a document of title, a contract of carriage and a receipt for goods.
Bond: Acceptable proof of financial responsibility to act as an Ocean Transportation Intermediary in the international ocean transportation of cargo, typically issued by a surety company.
Bunker Adjustment Factor (BAF): A charge sometimes added to steamship freight rates; justified by higher fuel costs. Also known as Fuel Adjustment Factor (FAF) or Bunker Charge or Bunker Surcharge.
Carriage of Goods by Sea Act (COGSA): U.S. federal codification passed in 1936 which standardizes and sets limitations on a carrier’s liability under carrier’s bill of lading. U.S. enactment of The Hague Rules.
Consignee: A person or company to whom commodities are shipped.
Consolidator: A firm which groups together shipments from different companies into a single shipment.
Container: A truck trailer body that can be detached from the chassis for loading into a vessel, a rail car or stacked in a container depot. Containers may be ventilated, insulated, refrigerated, flat rack, vehicle rack, open top, bulk liquid or equipped with interior devices. A container may be 20 feet, 40 feet, 45 feet, 48 feet or 53 feet in length, 8’0" or 8’6" in width, and 8’6" or 9’6" in height.
Customs Broker: A person or firm, licensed by the treasury department of their country when required, engaged in entering and clearing goods through Customs for a client (importer).
Demurrage: A penalty charge against shippers for delaying a shipment/container at port of loading or destination beyond the allowed free time. At times used interchangeably with detention. Demurrage applies to cargo. Detention applies to equipment.
Dock Receipt: A form used to acknowledge receipt of cargo and often serves as basis for preparation of the ocean bill of lading.
Forty-Foot Equivalent Units (FEU): Refers to the standard container size of 40 feet. Two 20–foot containers or TEU’s equal one FEU.
Free Time: That amount of time that a carrier’s equipment may be used without incurring additional charges.
Freight Forwarder: A person whose business is to act as an agent on behalf of the shipper to arrange transportation services. A freight forwarder frequently makes the booking reservation. In the United States freight forwarders are licensed by the FMC as Ocean Transportation Intermediaries and are only designated freight forwarders for export shipments.
Full Container Load (FCL): A container that is loaded and unloaded entirely under the risk and account of a single shipper or consignee.
Less-than-Container-Load (LCL): The quantity of freight which is less than that required for the application of a full container load rate.
Non-Vessel-Operating Common Carrier (NVOCC): A cargo consolidator in ocean trades that will buy space from a carrier and re-sell it to smaller ship¬pers. The NVOCC issues bills of lading, publishes tariffs and otherwise conducts itself as an ocean common carrier, except that it will not provide the actual ocean or intermodal service.
Ocean Transportation Intermediary License: A document issued by the Federal Maritime Commission indicating that a person or company has authorization to act as a Freight Forwarder or Non-Vessel-Operating-Common-Carrier, has established proof of financial responsibility in the form of a bond for its transportation activities, and, if acting as a common carrier, has published a tariff containing its rates and charges.
Pallet: A platform with or without sides, on which a number of packages or pieces may be loaded to facilitate handling by a lift truck. Also known as a Skid.
Seaway Bill: This document serves to provide the terms and conditions of carriage and acts as a receipt of goods tendered to the carrier. However, unlike a bill of lading, a seaway bill is not a document of title.
Shipper: The consumer or business providing goods for shipment. A NVOCC also is a shipper in relationship to a VOCC.
Surcharge: An extra or additional charge.
Tariff: A publication setting forth the charges, rates and rules of transportation companies. NVOCCs and VOCCs must publish and maintain tariffs. To locate a tariff please visit: www.fmc.gov
Terminal Handling Charge (THC): A charge made for a service performed in a carrier’s terminal area.
Twenty-Foot Equivalent Unit (TEU): The standard measurement of containerized cargo. One TEU generally represents a single container measuring 20 feet long, 8 feet wide and 8.5 feet high.
Vessel-Operating Common Carrier (VOCC): A common carrier that operates, for all or part of its common carrier service, a vessel in a service between a port in the United States and a port in a foreign country.