Terms and conditions
- Bill of Lading, B/L is a receipt for cargo brought on board for its transportation.
- Shipper, Consignor is the person or company who supplies or owns the cargo that will be transported.
- Consignee is the person or company to whom the cargo will be delivered.
- Notify party is a person that will be informed by a carrier upon delivery of cargo. It is usually a forwarding agent or any other consignee’s representative at port.
- Freight is the amount of money paid for cargo transportation.
- Loading is a process of placing the cargo on board a ship or transportation mode.
- Discharging is a process of unloading the cargo from a vessel or a transportation mode.
- Feeder is a domestic container line used for transportation of cargo within one basin or delivery of containers from/to the port or on board vessel. When ordering a shipping over long distances, feeder transportation is included in the freight, special order or payment is not required.
Cost measurement of work and container carrying capacity of wagons and warehouses
- TEU is cargo measurement unit equal to volume of 1x20 feet container. 1x40 feet container equals to 2TEU. For 40 feet container rate, TEU data should be multiplied by two.
Terms of carriage
CY (Container Yard)
- Containers storage location before/after their further dispatch outwards.
- Carriage terms when dispatching or upon cargo arrival are carrier cost including services for cargo dispatch from/to CY (freight, loading/discharging from a ship, storage in CY, HE includes services for cargo reception/ its dispatch to/from CY.
DOOR (door-to door shipping) is a service when dispatching cargo or upon its arrival which means that the forwarding agent takes over the responsibility to arrange door-to-door transportation of shipper’s/consignee’s goods; carrier cost includes services involving dispatch from/to doors/warehouse of the shipper/consignee.
FI (Free in) Free from loading is a service when dispatching cargo, which means that the freight isn’t included in the loading cost.
FO (Free Out) Free from discharging is carriage terms to the point of destination which mean that the freight isn’t included in the discharging cost.
LI (Liner in) Liner services when dispatching cargo mean that the costs of cargo reception/ its handling at the container terminal and the loading on board a ship are included into the freight rate.
LO (Liner Out) Liner services upon cargo arrival mean that the discharging cost and receipt of the cargo and its handling at the container terminal are included in the freight rate.
README! TERMS OF FREIGHT ALWAYS CONSIST OF 2 PARTS – INFORMATION AS FOR DISPATCH AND ARRIVAL TERMS.
For instance, FILO, LICY etc.
Fees for the BFR (Basic Freight Rate) – lines are payable on account of freight.
ALL IN (All inclusive) means that the transportation cost includes additional fees, prescribed by terms and conditions of transportation. For example, if we are talking about the freight on account of LILO, it means that all related expenses, such as BAF, CAF etc. are also included into the freight rate, besides the actual freight, loading and discharging.
BAF (Bunker Adjustment Factor) is an additional charge for the BFR, the amount of which depends on the oil cost in the international market. It may vary monthly and quarterly. It is quoted per TEU (for example, at 500 US dollars/TEU).
CAF (Currency Adjustment Factor) means an additional charge for the BFR, the amount of which depends on the change in the exchange rate. It may vary monthly and quarterly. It usually is quoted at % for the BFR.
IMO Surcharge is an additional charge for the dangerous cargo.
ISPS or SEC (security charges) is harbor dues for security.
GRI (General Rate Increase) is estimated increase of the base rate since a particular date.
THC (Terminal Handling Charges) initially is any terminal services for cargo handling: loading/unloading of a ship, movement into piles etc. Nowadays, the practice shows that it is cargo handling services, according to the harbour rules paid by the shipper if it is the port of shipment (oTHC), or by consignee, if it is the port of destination (dTHC).
Heavy Lift Charge is an estimated increase for the extra weight of a particular cargo (used if case of large amount of heavy lift cargo on a certain direction).
PCS (Port Congestion Surcharge) is a surcharge due to excess congestion of the port.
PSS (Peak Season Surcharge) is a surcharge due to seasonal increase of transportation load at certain times of the year (“busy season”).
War Risk are charged at ports that are in zones of military operations.
Winter Surcharge is charged at ports where port waters are exposed to icing. It is valid in winter time.
README! The validity term of the freight rate should be stated!
README! Freight costs are determined in accordance with the date of cargo dispatch (B/L issue date at the port of shipment).
Additional provisions and charges (paid by local agents mainly via port forwarding agents)
Demurrage is penalty provisions for excessive use of the container from the moment its unloading at the terminal till the moment of empty container return to the port (for import) or from the moment the empty container is received for loading till the moment the laden container is loaded on board the ship (for export).
Administrative Fee = B/L Fee = Docs Fee (other variants are possible) is local line agent fees for paperwork. It may be charged per bill of lading or per container. Additional harbor dues (paid to the port usually via port forwarding agents, can be collected directly by the port or local line agents).
Storage is the rate for excess storage of cargo at the port. It is set off from the moment of unloading to the terminal till the moment of clearing the terminal. It is charged as per port rates and usually quoted for TEU and has an ascending scale (the longer the cargo is in the port, the more expensive each next day of storage is).
For presenting cargo for inspection - the rate for work of presenting a container on the inspection site (customs, sanitary, etc.). It is charged at the port rates on actual basis.
Rates for additional operations - port rates for any work not specified in the general container handling scheme (repacking, weighing, sealing, marking, etc.). These are charged at the port rates in actual basis.