A
ACI (Advance Commercial Information):
An initiative introduced by the Canada Border Services Agency (CBSA). It helps to bolster both security and efficiency within Canada’s customs clearance procedures. Carriers should provide information on cargo and conveyances (such as trucks, ships, and airplanes) before they arrive in Canada.
ACI is a valuable tool for customs authorities, helping them detect potential security threats, streamline the clearance process, and speed up the flow of goods across the Canadian border.
AMS (Automated Manifest System):
It is harnessed by the U.S. Customs and Border Protection (CBP) to oversee and manage the flow of goods in and out of the United States via air or sea transport. AMS requires the Non-Vessel Operating Common Carrier (NVOCC) or the freight forwarder at the export portto electronically submit shipment information to CBP 24 hours before the ship departsfrom the port of shipment.
This system streamlines customs clearance processesand keepsfreight under inspection,improving cargo security.
AWB (Air Waybill):
A document used in air freight transportation to provide information about the shipment, its destination, and the terms of transportation. It is similar to the bill of lading in sea freight, but it is sent along with the airfreight shipment.
All Risks:
A type of insurance thatcovers all loss or damage however it is caused, apart from any stated exceptions. Pay attention that the clause excludes coverage against damage caused by war, strikes, riots, etc.
B
B/L (Bill of Lading):
A legal document issued by a carrier to a shipper, detailing the type, quantity, and destination of the goods being carried.
It is a certificate of ownership for the goods. The consignee collects the goods with the bill of lading.
Bonded Warehouses:
A bonded warehouseis usedfor storing dutiable goods on which customs duties have not yet been paid, as well as other goods that have not completed customs procedures.
If these goods are to be re-exported, they are exempt from customs duties; however, if they are intended for the domestic market, customs duties must be paid.
Goods in a bonded warehouse can undergo activities such as sorting, repacking, and other simple processing.
C
Consolidation:
Consolidationrefers to the practice of gathering dispersedLCL(Less than container load) or LTL (Less than truckload) cargo into one container and then transporting them to the destination. Goods will be de-consolidated when arriving at the port of destination and sent to different addresses.
The consolidationprocess is rather complicated, leading to more procedures and risks.
CFS (Container Freight Station):
A warehouse where cargo that belongs to various exporters or importers is consolidated or de-consolidated.Goods to be consolidated will first undergo consolidation at the CFS before being transferred to the container yard for loading onto the container vessel.
CY (Container Yard):
A physical facility from which ocean carriers accept and deliver ocean containers, as well as issue and receive back empty containers.
Tip: A container yard is an exclusive space for full container load (FCL)containers, situated within ports; while a container freight station accommodates both less than container load (LCL) and FCL shipments, positioned near ports or terminals.
Carrier:
The carrier is the transportation company responsible for physically moving the goods from the shipper to the consignee. This could be an airline in the case of airfreight, a shipping line for sea freight, or a trucking company for land transportation.
Chartered Carrier:
An air carrierwhooffers flights based on specific requests from individuals, groups, or organizations, not following regular schedules.
These charters are often used for special occasions, group travel, sports teams, corporate events, and more.
CI (Commercial Invoice):
Adocument prepared by a seller giving details of goods supplied, their price, contract terms and the total amount due to be paid by the buyer.
Claim:
The demand or assertion of a right. In international trade, it refers to the claim for losses.
CO (Certificate of Origin):
A certificate that confirms the “nationality”of a product and serves as a declaration to satisfy customs or trade requirements.
Congestion Surcharge:
A congestion surcharge is an additional fee imposed by carriers when there is significant congestion or delays at a particular port or terminal.
This surcharge is intended to offset the increased costs and operational challenges that arise due to the congestion, which can impact the efficient movement of cargo and vessels.
Consignee:
The consignee is the recipient or receiver of the shipment. This is typically the buyer, importer, or the party to whom the goods are being delivered.
Chargeable Weight:
Chargeable weight is the weight used to calculate the cost of shipping freight, determined by comparing the actual weight of the shipment to its volumetric weight(also known as dimensional weight). The higher of the two weights is considered the chargeable weight.
Customs Clearance:
Customs clearanceis the process of meeting a country’s customs requirements for importing goods. It involves providing necessary documentation, calculating and paying import duties and taxes, and complying with regulations to ensure legal international trade.
Goods to pass through customs correctly to avoid delays, fines, or confiscation. Businesses often use customs clearance agents to navigate this process efficiently.
Customs Duty:
Customs duty is a tax on imported goods paid by the importer to the destination country’s customs authorities.
D
Declared Value:
The declared value represents the value that a shipper declares to the carrier for their shipment.
If the shipment experiences any loss or damage during transit, the carrier is responsible for providing compensation to the shipper based on the declared value.
Tip:It is not insurance for shippers. The shipper must prove that the carrier’s negligence directly resulted in the loss or damage to cargo.
Declaration Form:
A declaration form is a document used to provide detailed information about goods being imported or exported. This document is sent to customs authorities to ensure adherence to regulations and to evaluate applicable taxes and duties.
Detention:
Charges for returning shipping containersto the dock beyond the allowed free time.
Demurrage:
Charges incurred when cargo is delayed at the port beyond the agreed-upon time for loading or unloading.
D/T (Delivery Time):
“Delivery time” refers to the duration it takes for goods to be transported from the point of origin to the final destination (e.g., a buyer or customer).
Date of Delivery:
This is the date when the goods arrive at the final destination and are handed over to the recipient or consignee. It signifies the completion of the shipping process.
Date ofShipment:
This is the date when the goods are handed over to the carrier for transportation, referringto a specific point in time. It marks the beginning of the shipping process and is often used to determine the start of contractual agreements or shipping terms.
Drayage:
Drayage involves moving containers or other cargo between different modes of transportation, such as between ships, trains, or trucks, within a specific region. The fees usually occur whengoods are transported from a port to a nearby warehouse, distribution center, or rail yard.
DOC (Documentation):
The documents involved in import/exportprocess, such as invoices, insurance policies or insurance certificates, bills of lading,drafts, etc.
Documentary Collection:
A payment method where the buyer’s bank collects payment from the buyer and releases documents necessary for goods’ delivery upon payment.
D/P (Documents Against Payment):
It’s a term used in international trade and finance to refer to a payment method where the exporter releases shipping and title documents to the importer only upon receipt of payment.
This ensures that the importer must make the payment before gaining control of the goods and related documents.
D/A (Documents Against Acceptance):
In a D/A transaction, the exporter releases shipping and title documents to the importer upon acceptance of a time draft or a bill of exchange.
The importer commits to making payment on a specified future date, usually after a certain period (such as 30, 60, or 90 days) from the date of acceptance.
D/O (Delivery Order):
A delivery order is a document issued by a carrier or shipping company to authorize the release of cargo or goods to the recipient, consignee, or another party indicated in the document. This document also confirms that any associated transportation or handling fees have been sorted out.
The consignee, usually the importer, needs to present the bill of lading during cargo pickup, and then they receive a delivery order to pick up the goods.
E
ENS (Entry Summary Declaration):
A vital component of the European Union’s (EU) Advance Cargo Information (ACI) system.This requirement is applicable to goods imported into the EU, functioning in a manner similar to ACIand AMS.
ENS mandates that either carriers or their authorized representatives provide comprehensive cargo information to customs authorities of the destination EU member state ahead of the goods’ arrival.
ETA (Estimated Time of Arrival):
ETA signifies the anticipated arrival time of a shipment at its destination.
ETD (Estimated Time of Departure):
ETD is the expected departure time of a shipment from its origin, crucial for planning and tracking.
Endorsem*nt:
A signature on the reverse of a negotiable instrument made primarily to transfer the holder’s rights to another person.
Export License:
An export license is an official permit issued by a government or relevant authority, allowing individuals, businesses, or organizations to legally export specific goods to another country.
These licenses are necessary for goods subject to export controls, often related to national security, international agreements, or trade policies.
Sellers should consult with authorities or trade experts to determine if their goods require an export license for international trade.
F
F.P.A. (Free from Particular Average):
A limited form of cargo insurance, that offers coverage for total losses and general average resulting from “marine perils.”
It excludes coverage for partial losses to the cargo or hull, except those caused by stranding, sinking, burning, or collision.
FCL (Full Container Load):
Sea shipments of an entire container.
Fulfillment:
The act of storing products, filling orders, and shipping for an outside company.
Freight:
Either cargo or space reserved by a shipper on a carrying vessel, or the charge made by a shipping company.
Fumigation:
A process of using chemical gases or fumes to eliminate pests, insects, or pathogens within a confined area. Fumigation helps prevent the spread of pests across borders and maintains the biosecurity of different regions.
FBA (Fulfillment by Amazon):
FBAservice provides Amazon sellers the ability to entrust their shipping responsibilities to the platform. Within this e-commerce fulfillment framework, Amazon takes charge of storage, product selection, packaging, shipping, and the final delivery to customers.
Furthermore, Amazon takes on the roles of customer service and managing returns for these transactions.
G
GW (Gross Weight):
Shipping weight represents the gross weight in kilograms of shipments, including the weight of moisture content, wrappings, crates, boxes, and containers.
GP (General Purpose Containers):
GP Containersaccommodate various cargo types, having a standard height of approximately 2.6 meters. There are two common sizes of containerswith a height of 2.6 meters: 20’GP and 40’GP.
H
HAWB (House Air Waybill):
Issued by an intermediary, often a freight forwarder or consolidator, to cover individual shipments within the larger consignment.
In other words, it’s used when the main shipment is broken down into smaller units for distribution to different consignees.
HBL (House Bill of Lading):
Issued by a freight forwarder or Non-Vessel Operating Common Carrier (NVOCC) to cover individual shipments within the larger consignment.
Upon the deconsolidation of the buyer’s cargo from the container, the buyer can pick up the cargo by presenting the HBL to the local co-loader.
Hauler (Haulage Contractor):
A person or a firm that owns lorries and contracts to carry goods by road.
HMF (Harbor Maintenance Fees):
Charges imposed by ports or authorities to fund the maintenance and improvement of harbor facilities and infrastructure.The collected funds are used to ensure the upkeep, dredging, and general maintenance of navigation channels, berths, and other port-related structures.
These fees are typically applied to vessels entering a port and are based on the tonnage or size of the ship.
HQ (High Cube Containers):
HQ Containers, resembling standard containers but with increased height at approximately 2.9 meters, provide extra room for cargo, making them particularly beneficial for accommodating oversized items.
HTS (Harmonized Tariff Schedule):
It is a standardized system for classifying and coding goods for customs purposes, used by various countries to facilitate international trade and ensure consistency in tariff application.
I
ICAO (International Civil Aviation Organization):
It is a specialized agency of the United Nations that works to establish global standards and regulations for international civil aviation.
IATA (International Air Transport Association):
A trade association that represents and serves the airline industry worldwide. It provides airlines with a platform to collaborate, share best practices, and address common challenges.
Intermodal Shipping:
Intermodal shipping involves the use of multiple modes of transportation, such as trucks, trains, ships, and planes, within a single journey.
Intermodal shipping is distinguished by the continuity of cargo within the same container throughout its entire journey, seamlessly transitioning between different modes of transportation. This allows for the container to be transferred without the need to unload and reload its contents.
ISF (Importer Security Filing):
It is a program implemented by U.S. Customs and Border Protection (CBP) that requires importers or their agentsto provide certain information about cargo shipments entering the United States. Information has to be provided24 hours before the cargo is loaded onto a vessel destined for the U.S.
This information is submitted electronically through the Automated Broker Interface (ABI) or the Automated Manifest System(AMS). Failure to comply with ISF requirements can result in penalties and delays in cargo clearance.
It consists of 12 elements: 10 provided by the importer and 2 by the shipping company, hence it’s also referred to as 10+2 ISF (Importer Security Filing).
Tip: AMS filing is required for all shipments entering the United States, whether through sea or air. ISF is mandatory only for ocean shipments bound for the United States.
Incoterms:
The International Commercial Terms, abbreviated as Incoterms, are a set of international rules established by the International Chamber of Commerce (ICC).
These rules clarify various aspects of international trade, including the delivery of goods, the transfer of risk, and payment obligations.
Typically represented by three-letter codes, these terms are widely used to ensure smooth global trade and prevent misunderstandings between businesses.
L
L/C (Letter of Credit):
It serves as a financial guarantee from a buyer’s bank to a seller, assuring that payment will be made once certain conditions are met.
In the event that the buyer cannot make the payment, the bank will step in to settle the entire purchase amount.
Lead Time (L/T):
Lead time refers to the period required for the completion of a process from its initiation to its conclusion.
Particularly in manufacturing, lead time signifies the interval for crafting a product and ensuring its delivery to the end consumer.
LCL(Less than Container Load):
It refers to a shipping methodwhere multiple shippers share the use of a single container.
M
MAWB (Master Air Waybill):
The primary airway bill issued by the main carrier, typically the airline, to cover the entire shipment from the origin airport to the destination airport.
MBL (Master Bill of Lading):
Issued by the main carrier, often the shipping line or vessel operator, to cover the entire cargo shipment on a specific voyage.
MSDS (Material Safety Data Sheet):
An essential document offering an in-depth understanding of a particular chemical compound’s characteristics, potential dangers, recommended handling procedures, appropriate storage guidelines, and emergency protocols.
Primarily authored by manufacturers, importers, or distributors of hazardous substances.
For the safety of the shipping, hazardous goods, chemicals, and magnetic items all require the submission of MSDS documents and corresponding test reports to the shipping company and customs.
Multimodal Shipping:
Multimodal shipping uses multiple modes of transportation, but it allows for the transfer of goods from one container to another when transitioning between modes.
In other words, the cargo is loaded into different containers at different points in the journey, involving additional handling and potentially more complex logistics.
Tip: Intermodal shippinguses a single container throughout the journey, while multimodal shipping involves transferring goods between containers at different points.
N
NVOCC (Non-Vessel Operating Common Carrier):
A type of freight forwarder that does not own or operate its own vessels (ships), but instead, acts as an intermediary between shippers and shipping lines.
NVOCCs gather cargo from various customers and combine them into larger containers, which they subsequently organize for shipping.
Net 7:
A payment term used in business transactions, indicating that the payment for goods or services is due seven days from the invoice date.
Namely, the buyer is expected to make payment within seven days after receiving the invoice.
O
O/F (Ocean Freight):
O/F, short for Ocean Freight, represents the cost of shipping goods by sea, a key factor in international shipping expenses.
Open Account:
Apayment arrangement in international trade where the seller ships goods to the buyer and invoices them, with payment due at an agreed-upon date in the future. In this method, the buyer doesn’t make an upfront payment; instead, they have a specified period, usually 30, 60, or 90 days, to settle the invoice.
This approach requires trust between the parties and is often used in established and ongoing business relationships.
P
Packing List:
A list of products shipped by the vendor to be used to verify the items during the receiving process. It should not be confused with invoice for there is no pricing on the document.
PIA (Payment in Advance):
The buyer pays the seller in advance, often before the goods are shipped. It is typically used for low-value sales and individuals or new customers.
Pallet:
A flat wooden structure used to collect items to be shipped, allowing a forklift or pallet jack to safely move the product around.
POL (Port of Loading):
The port at which the goods are loaded onto the ship.
POD (Port of Discharge):
The port where the goods are unloaded from the ship.
Port of Delivery:
It is the port near the final destination of the container or cargo.
S
SCAC Code (Standard Carrier Alpha Code):
Issued by the National Motor Freight Traffic Association (NMFTA), it is globally unique and used to identify transportation companies like carriers, NVOCC, or freight forwarders.
The SCAC code helps in the identification and tracking of transportation companies in various transportation and logistics systems. It’s commonly used in bill of lading and freight shipment documentation, necessary when filing AMSor ISF.
Scheduled Airline:
An air carrier that operates according to a published schedule, offering regular and predefined routes with set departure and arrival times.
Shipper:
The shipper is the entity or individual responsible for sending or initiating the shipment. This is usually the seller, manufacturer, or exporter who is sending the goods to their destination.
SO (Shipping Order):
A document issued by the carrier that confirms a shipment’s booking on a vessel.
T
Tare Weight:
The weight of a container and/or packing materials without the weight of the goods it contains.
TEU (Twenty-Foot Equivalent Unit):
TEU measures a container vessel’s capacity by representing it as the cargo volume of a standard twenty-foot container, widely used in shipping calculations.
T/T (Transit Time):
It is the duration it takes for goods to travel from one location to another. It encompasses the time spent in transportation, including any stops, transfers, or delays, and is a crucial factor in logistics.
Title:
It serves as proof of ownership and provides information about the individual or entity that possesses the rights to that particular item.
In the context of international trade and commerce, a title can refer to ownership documents for goods, such as bills of lading or certificates of origin, which indicate who has legal control over the goods and the right to transfer them to other parties.
TT (Telegraphic Transfer):
TT is a secure and swift method for international money transfers, widely used in business, especially international trade, to ensure timely payments and reduce risks associated with cash or checks.
The sender (payer) goes to their bank and provides instructions to make a telegraphic transfer to a specific recipient (payee) and account. The sender’s bank then electronically transmits the funds to the recipient’s bank. The recipient’s bank receives the funds and credits them to the recipient’s account.
U
ULD (Unit Load Device):
Standardized aircraft containers or pallets used in the aviation industry for secure transport of cargo on aircraft.
UN/LOCODE:
UN/LOCODE, which stands for United Nations Code for Trade and Transport Locations. UN/LOCODE assigns unique five-character codes to seaports, airports, and other transport-related places.It’s all about recognizing locations that play a vital role in international trade and transport.
This system, created in 1981 and overseen by the United Nations Economic Commission for Europe (UNECE), serves as a standardized geographic code system.
V
VAT (Value Added Tax):
A Value Added Tax identification number is a unique identifier assigned to a business or individual by tax authorities in countries that use the Value Added Tax system.
This number is used to track and monitor the payment of Value Added Tax on goods and services that are bought and sold within a specific jurisdiction.
Volumetric weight:
An alternative term for dimensional weight (DW). It is calculated from parcel dimensions in cm, divided by either a factor of 5000 or 6000.
W
W.A./W.P.A. (With Average/With Particular Average):
It covers wider than F.P.A.and covers a partial loss.
War Risk Surcharge:
An additional fee imposed by shipping companies or carriers to cover the increased insurance costs and risks associated with transporting cargo through regions or routes that are considered high-risk due to geopolitical conflicts, war zones, or other security concerns.
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