All Risks Coverage, a type of marine insurance, is the broadest kind of
standard coverage, but excludes damage caused by war, strikes, and
riots.
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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.
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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.
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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.
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A general cargo vessel designed to efficiently handle un-containerised
cargo. Vessels are usually self-sustaining in that they gave their own
loading and unloading machinery.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.)
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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").
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Deliver Duty Unpaid, referring to DDP except buyer pays for the import duty.
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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.
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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.
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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).
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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.
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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.
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The FMC is an independent agencys which regulates oceanborne
transportation in the foreign commerce and in the domestic offshore
trade of the United States.
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Especially for heavy loads and over-dimensional cargo. Containers do
not have sides or a top. This allows easy fork-lift and crane access.
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Forty Feet Equivlent Unit (FEU)
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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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. (also see incoterm chart)
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This certificate is used to assure the consignee that insurance is
provided to cover loss of or damage to the cargo while in transit.
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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.
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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.
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Movement of goods by more than one mode of transport, ie. airplane, truck, railroad and ship.
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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.
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Less than Container Load, consolidated container load.
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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.
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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."
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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.
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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.
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This is a term normal referred to when shipping cargo air or sea, which
does not fall within standard methods. Ie over-height, or oversize
cargo which requires special equipment and handle.
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A type of ship designed to load & discharge cargo which rolls on wheels or tracks.
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The letters, numbers or other symbols placed on the outside of cargo to facilitate identification.
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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).
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The weight of a container and/or packing materials without the weight of the goods it contains.
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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.
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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.
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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.
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The ultimate consignee is the person located abroad who is the true
party in interest, receiving the export for the designated end-use.
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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.
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An insurance provision that covers loss due to war and/or strike.
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A charge assessed by a pier or dock owner for handling incoming or outgoing cargo.
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