Abandonment The act of relinquishing claim or right to property
About “About”, “Approx.”, and “Circa” are terms which when used in a letter of credit, are construed to allow a difference not to exceed 10% more or 10% less than the monetary amount, or the quantity, or the unit price stipulated in the letter of credit.
Absorption 1. An economic term for the total expenditures by a nation’s residents on goods and services.
2. The assumption by one carrier of the charges of another without any increase in the charges to the shipper.
Accelerated Tariff Elimination The reduction of import duties faster than originally had been agreed upon or projected.
Acceptance 1. A draft calling for payment at a future date which the drawee has agreed to pay by signing “Accepted” on the draft.
2. An unconditional assent to an offer; or an assent to an offer conditioned on only minor changes that doo not affect any material terms of the offer;
3. An agreement to purchase goods on specified terms.
4. Receipt of a shipment by a consignee thus terminating the liability of the carrier for delivery.
Acceptance Letter Of Credit A letter of credit which in
Accepted Draft A draft or a bill of exchange accepted by the drawee (acceptor) by putting his signature and “accepted’ on its face. In doing so, he commits himself to pay the bill upon presentation at maturity.
Accepting Bank A bank which by signing ‘accepted’ on a time draft accepts responsibility to pay when the draft becomes due.
Acceptor The party that signs ‘accepted’ on a draft or obligation, agreeing to pay the stated sum at maturity.
Accession Accession is a process by which a country beecomes a member of an international agreement (usually an agreement that has already been accepted by other countries).
Accessorial Charges In transportation, those charges made for additional, supplemental, or special services performed in addition to the basic transportation service.
Accessorial Services `In transportation, services performed which are additional, supplemental, or special, in addition to the basic transportation service.
Accommodation An arrangement or engagement made as a favor to another, not dependent upon a consideration received.
Accommodation Note Or Paper A bill of exchange or banker’s acceptance which is en
Accord And Satisfaction A means of discharging a claim whereby the parties agree to give and accept something in settlement and perform the agreement, the agreement being the “accord” and its performance “the satisfaction.”
Account Number An identification number assigned in its records for purposes of faster and more accurate accounting and record keeping, by banks, institutions, and businesses of all kind to their depositors, users, members, subscribers, customers, vendors, or other entities.
Account Party Same as Applicant, the party at whose request a bank issues a letter of credit.
Accounts Payable A current liability representing the amounts owed to creditors for merchandise or services purchased on open account or short-term credit.
Accounts Receivable The amount of money a business expects to receive for merchandise or services furnished by it to others on open account.
Accrual Of Obligation The maturing of an obligation to the date when the obligated party must perform. (Such as a time draft which must be paid by the drawee on the date stated.)
Acquisition The act of becoming owner of a property. In finance, it is the purchase of a company’s assets or
Act Of God A violent act of nature such as lightning, flood, earthquake or hurricane which man can neither cause nor intervene with.
Action Ex Contractu 1. A legal action for breach of a promise stated in an express or implied contract.
2. An action arising out of a contract.
Action Ex Delicto 1. A legal action for a breach of a duty that is not stated in a contract but arises from the contract.
2. A legal action that arises from a wrongful act, such as fraud, fault, misconduct or malfeasance.
Ad Valorem Duty Duty calculated on the basis of value (usually a percentage of the value.)
Address Of Record The official or primary location for an individual, company, or other organization.
Adhesion Contract A contract with standard, often printed, terms for sale of goods and services, offered to consumers who usually cannot negotiate any changes in the terms and cannot acquire the product unless they agree to them.
Adjustment Assistance Financial, training and re-employment technical assistance to workers, and technical assistance to firms and industries, to help them cope with adjustment difficulties arising from increased import competition.
Admiralty Any civil or criminal matter having to do with maritime legal issues.
Admiralty Court A court of law that has jurisdiction over maritime legal issues.
Advance Against Collection A sh
Advance Arrangements In transportation, advance arrangements must be made for certain kinds of cargo which require special handling: hazardous cargo, over weight, over sized, over normal quantity, time sensitive, shipped unpacked, live animals etc. Not every carrier can or will transport every kind of cargo.
Advanced Technology Products (ATP) Products whose technology is from a recognized high technology field, represent leading edge technology in that field, and constitute a significant part of all items covered in the selected classification code.
Advice 1. A report from one party to another informing them of an occurrence with regard to some business transaction: a shipment, a collection, a manufacture etc.etc.
2. A notification by an advising bank on behalf of the issuing bank to a beneficiary informing them of the terms of a letter of credit,
Advised Credit A letter of credit whose terms and conditions have been notified to the beneficiary by an advising bank on behalf of the issuing bank. The advising bank does not thereby commit itself to pay or guarantee the payment of the letter of credit.
Advising Bank An ‘advising bank’ is a correspondent of a bank which issues a letter of credit, and, on behalf of the issuing bank, the advising bank notifies the beneficiary of the terms of the credit, without engagement on its part to pay or guarantee the credit.
Advisory Committee On Export Policy A U.S. government interagency dispute resolution body that operates at the Assistant Secretary level.
Advisory Committee On Trade Policy And Negotiation A U.S. government group appointed by the President to provide advice on matters of trade policy and related issues, including trade agreements.
Affiliate A condition of being united, allied, associated, or attached. An affiliate company is one effectively controlled by another.
Affreightment Contract A contract with a ship owner to hire all or part of a ship for transporting goods – may involve a charter.
Afloat Refers to a shipment of cargo which is currently on board a vessel between ports
Aft At or towards the stern of the ship or the tail of the aircraft.
After Date A notation used on financial instruments (such as drafts or bills of exchange) to fix the maturity date as a fixed number of days past the date of drawing of the draft.
After Sight A notation on a draft that indicates that payment is due a stated number of days after the draft has been presented to the drawee.
Agent A person or legal entity authorized to act on behalf of another.
Agent Bank 1. A bank acting on behalf of another bank.
2. A bank acting for lenders and bondholders, similar to an indenture trustee.
Aggregated Shipments Several shipments intended for one consignee from various shippers that are consolidated and treated as a single consignment.
Agreed Valuation The value of a shipment that is agreed upon by both the shipper and the carrier to define the freight rate and/or the liability of the carrier.
Air Cargo Property of any kind that is transported by aircraft (excluding passenger baggage and mail).
Air Express Expedited air freight service.
Air Parcel Post Parcels shipped through the mails to be transported by air.
Airwaybill The shipping document used for the transportation of air freight: includes conditions, limitations of liability, shipping instructions, description of commodity, and applicable transportation charges. It is generally similar to a straight non-negotiable bill of lading and is used for similar purposes.
Alienable Ability to be transferred or conveyed.
All-Cargo Aircraft Any aircraft that is used for the sole purpose of transporting cargo or mail.
Allowance A deduction or discount from the price permitted by a seller.
Alternative Tariff In transportation, a tariff with two or more rates for the same goods, to and from the same points, with the opportunity available to the shipper to use the lowest of the charges.
Amendment An addition, deletion, or modification of a document.
Amidships The area of a vessel midway between the front (the bow) and the rear (the stern). When the term applies to an airplane, it is midway between the nose and the tail.
Amortization 1. The provision to pay a debt over a period of time.
2. The gradual repayment of borrowings in a series of installments.
3. A transaction or security where the principal reduces over the life of the agreement.
4. The writing off or reduction in value of an intangible asset over time (c.f.depreciation)
5. Allocation of the cost of an asset over its estimated useful life.
Antidumping Duties Additional duties which are assessed on imported goods when those goods are sold to the importing country at a price that is less than “fair value”, (“fair value” usually being defined as the price on the exporting country’s domestic market or to third countries), and when those imported goods are found to cause or to threaten material injury to industry of the importing country.
Any Quantity A cargo freight rate that applies to an article without regard to the weight or quantity shipped.
Applicant (also Account Party) 1. The party at whose request a bank issues a letter of credit.
2. A person who applies for something: a job, a passport, a visa, a license, a ticket etc. etc.
Appreciation An increase in the value of something, – of goods, of currency, of shares of stock, etc,.
Approx. (Approximately) Same as “about” and “circa”; terms which when used in a letter of credit are construed to allow a difference not to exceed 10% more or 10% less than the monetary amount, or the quantity, or the unit price.
Appurtenance An accessory, adjunct, or appendage connected to a primary property and used in conjunction therewith.
Apron 1. Area of the airport where planes are parked. May be used for loading and unloading of aircraft.
2. Area along the waterside edges of a pier, not under cover, used for loading and unloading of vessels.
Arbitrage A method of taking advantage of the fact that there may be different prices in different markets for identical goods such as gold, foreign exchange or commodities. Simultaneously, one buys in the lower price market and sells in the higher one.
As Is Indicates goods for sale do not include a warranty , implied or expressed; the buyer takes the entire risk as to the quality or condition of the goods involved and must trust to his own inspection. In sum, the sale is “without recourse”.
Assembly Service A service under which a carrier or a forwarder or a warehouse combines multiple shipments from multiple shippers into one shipment for one receiver.
Assessment 1. The valuation, or determination as to value, of property.
2. The act of apportioning amounts to be paid.
3. An amount assessed or charged, for example: taxes or dues.
Assignment of Proceeds of a Letter Of Credit If the bank agrees, the beneficiary assigns all or part of the proceeds to be paid to another party after the required documents have been presented.
At Sight A notation on a draft which indicates that payment is due upon its presentation.
Athwartships Across a vessel form side to side.
Automated Broker Interface (ABI) (USA) A module of the U. S. Customs Automated Commercial System which provides a communications link for the transmission of entry and entry summary data on imported merchandise between ABI users and Customs.
Automated Commercial Environment (ACE) (USA) A US Customs electronic data system, which provides support for enforcing trade and contraband laws, ensuring trade compliance, and providing service and information to the international trade community. When completed, it will cover the full gamut of Customs activities.
Automated Commercial System (ACS) (USA) The comprehensive electronic data system of U. S. Customs for tracking, controlling, and processing commercial importations.
Automated Information Exchange System (AIES) (USA) A module of the Automated Commercial System of U. S. Customs which provides an automated method of exchanging information between Field Import Specialists and National Import Specialists.
Automated Manifest System (AMS) (USA) A module of the Automated Commercial System of U. S. Customs designed to control imported merchandise from the time a carrier’s cargo manifest is electronically transmitted to U.S. Customs until the cargo is properly entered, released by customs and delivered.
Avoidance Of Contract The legal cancellation of a contract because an event occurs that makes performance of the contract terms impossible or inequitable and that releases the parties from their obligations.
Back Haul The return of a carrier to the original point or area from which its journey began. If a carrier can obtain cargo to carry on the back haul route, that cargo may often obtain a favorable freight rate because otherwise the carrier would have to return empty.
Back Order That portion of an order that cannot be delivered at the scheduled time, but will be delivered at a later date when available.
Bad Faith The intent to mislead or deceive. It does not include misleading by an honest, inadvertent or uncalled-for misstatement.
Bagged Cargo Goods shipped in sacks.
Bailment A delivery of goods or personal property by one person (the bailor) to another (the bailee) on an express or implied contract for a particular purpose related to the goods while in possession of the bailee, who has a duty to redeliver them to the bailor.
Balance Of Payments A statement summarizing all the economic and financial transactions between companies, banks, private households and public authorities of one nation with those of the other nations of the world over a specific time period. It includes merchandise trade payments, payments and receipts on account of shipping services, tourist services, financial services, government expenditures, short and long term capital movements, interest and dividends, gold movements, etc.
Balance of Trade The difference in value between a country’s total imports and exports over a specific time period.
Balanced Economy A condition of national finances in which imports and exports are equal.
Bale A large bundle or package of compressed and bound goods, usually with an outer covering, often of burlap.
Bale Cargo Cargo shipped in bales.
Ballast Heavy material or water placed in the lower holds of a ship or in strategically placed tanks along the sides to improve its stability.
Bank Acceptance A draft drawn on and accepted by a bank.
Bank Delivery Order to an Airline A letter addressed to an air carrier from a bank who is shown as consignee on an airwaybill instructing the carrier to release a shipment. Often airlines will accept as a delivery order a bank’s endorsement on the airwaybill, although an airwaybill is a non-negotiable document.
Bank Draft A form of check drawn by a bank against its account in another bank.
Bank Guarantee An indemnity letter in which the bank commits itself to pay a certain sum if a third party fails to perform or if any other form of default occurs. One use is when a bank wants a carrier to release a shipment which it has financed but the original bills of lading are not yet available for surrender to the carrier.
Bank Holding Company (USA) Any company which directly controls, with power to vote, more than five percent of voting shares of two or more banks (as defined by the Bank Holding Company Act .
Bank Holiday A day on which banks are closed.
Bank Note A promissory note having the appearance of currency, issued by a bank or banker authorized to do so, payable to bearer on demand, and intended to circulate as money.
Bank Release A document issued by a bank who is the consignee of a shipment authorizing a carrier to deliver a shipment.
Banker’s Bank A bank that is established by mutual consent by independent and unaffiliated banks to provide a clearinghouse for financial transactions.
Banker’s Draft A draft payable on demand and drawn by, or on behalf of, a bank upon itself or upon another bank, sometimes a foreign bank, where it maintains an account or a relationship.
Bankers Acceptance A draft calling for payment at a future date on which the drawee is a bank, and the bank has agreed to pay by signing “accepted” on the draft.
Bankruptcy The condition of a legal entity that does not have the financial means to pay their incurred debts as they come due. In the U.S. this status is established through legal procedures involving a petition by the bankrupt or by its creditors.
Bareboat Charter The charter of a vessel where the charter party has the right to use his own master and crew on the vessel. Pays all operating expenses.
Barge A flat bottomed cargo vessel primarily used on rivers and canals. Usually it is towed or pushed but it may be self-propelled.
Barratry 1. In maritime law the intentional misconduct of the ship’s master or crew; includes theft, intentional casting away of vessel, or breach of trust.
2. The offense of frequently stirring up quarrels and suits, either at law or otherwise.
Barter Trade of goods or services without the use of money.
Basing Point A location which is used to set the selling price of goods and the freight rates to all points. A price is set at a given location chosen as the ex-factory basing point with freight to the place of delivery added to create a delivered price. Then like goods, wherever they may be sold from, are charged freight to their destination as if they were shipped from the same location (the basing point).
Basing Rate A freight rate which is used for the sole purpose of determining other freight rates. For an explanation of how this works, see ‘Basing Point’.
Basket of Currencies A composite unit consisting of weighted amounts of the currencies of a group of designated nations.
Battens 1.The protruding fixtures on the inside walls of a vessel’s hold which are used to keep the cargo away or to fasten it in place.
2. Similar structural parts to the above in truck bodies, containers and rail cars.
Bearer The person in possession of a negotiable instrument, document of title, or security marked “payable to bearer”, or the person in possession of one of these documents endorsed in blank.
Beggar-Thy-Neighbor Policy A course of action through which a country tries to reduce unemployment and increase domestic output by raising tariffs and instituting non-tariff barriers that impede imports, and thus improve its own position at the expense of its trading partners.
Belly Pits or Holds Compartments beneath the cabin of an aircraft used for the transport of cargo or baggage.
Beneficiary 1. In the case of a letter of credit, the individual or company who is entitled to draw or demand payment under its terms.
2. In the case of insurance, the person entitled to take the proceeds.
3. The person for whose benefit a contract, or trust, or will is executed or enforced.
Berth The place beside a docking area where a ship is secured and cargo can be loaded or unloaded.
Bid Bond A type of indemnity bond. A surety guarantee often required to be established by a bidder to guarantee fulfillment of his offer if accepted.
Bilateral Investment Treaty A treaty between two countries with the goal of ensuring that investments made by either of them in the other receive treatment equal to that afforded their domestic entities or any third country entities.
Bilateral Trade The commerce between two countries.
Bill 1. A “Bill of Exchange” or “Draft” (same thing).
2. A written statement of contract terms.
3 .The word “Bill” has many other international trade connotations – “Invoice” etc.
Bill of Credit A written authority from one person to another, empowering the recipient of the document to receive money from the correspondents of the issuer abroad . (The usual issuer is a bank)
Bill of Exchange Draft or Bill.
Bill of Health An official certificate (Pratique) issued by the authorities upon the departure of a vessel or airplane showing the state of health at the place of departure, and of the passengers and crew.
Bill of Lading A document issued by a carrier which is evidence of receipt of the goods, and is a contract of carriage. It describes the goods, the details of the intended voyage, and it specifies the conditions of transportation. If issued in negotiable form, i.e. “to order”, it becomes documentary evidence of title to the goods.
Bill of Sale A written document by which a party legally transfers ownership of goods to another party.
Bill-To Party The party designated on purchase order, invoice, or bill of lading as the one to whom the bill should be sent for payment.
Billed Weight The designated weight shown on the freight bill which is used to calculate the freight charges.
Billing Third Party The transference of transportation charges to a party other than the shipper or consignee.
Biological Agents A complex substance of organic origin which can treat or cause disease.
Black Market Buying or selling of products that violate government restrictions.
Blanket Rate In insurance, a rate of premium applied across the board when there is more than one kind of property which is the subject of insurance.
Blockade Prevention of commercial exchange by physically preventing carriers from entering a port or nation.
Bona Fide In or with good faith, honesty, and sincerity.
Bond 1. A written undertaking to perform or refrain from performing specified acts, usually guaranteed by a third party.
2. A security evidencing debt, specifying the date payment is due and usually specifying a rate of interest and its dates of periodic payment.
Bond of Indemnity A bond to indemnify and save harmless the party to whom the bond is issued against some anticipated loss.
Bond System (USA) An automated electronic system, part of the Automated Customs System, whose purpose is to control and track indemnity bonds issued to Customs to secure compliance with various laws.
Bonded (USA) This term refers to goods which are held, stored or transported under circumstances where applicable duty or taxes have not yet been definitely determined or paid, and admissibility has not yet been arranged. Bonds must be posted by those who are responsible for the goods during this period (the carriers, warehouses, and/or importers) to indemnify the government if the goods are released improperly.
Bonded Terminal (USA) A terminal approved by Customs for temporary storage of imported goods until Customs duties are paid or goods released. Bonds must be posted by the terminal operator to indemnify the government if the goods are released improperly.
Bonded Warehouse (USA) An approved private warehouse used for the storage of goods until duties or taxes are paid and the goods are properly released by Customs. Bonds must be posted by the warehouse proprietor and by the importer to indemnify the government if the goods are released improperly.
Booking The making of arrangements for a shipment with the representatives of a vessel or airline.
Bounties A compensation paid to persons to induce certain actions. In this class are government payments to producers or exporters to strengthen their competitive position.
Box 1. Term referring to a trailer, semi-trailer, or container used in transportation.
2. A type of package of wood, cardboard, metal, plastic or other material.
Box Car A closed railroad freight car.
Boycott A concerted refusal to deal commercially with a person, firm, or country.
Breakage 1. A monetary allowance that a manufacturer allots for compensation to a buyer for breakage to goods (usually fragile) while in shipment.
2. A fractional amount due either party in a transaction, for example in computing interest.
3. In marine insurance, “breakage” refers to breakage of fragile goods such as glass and china.
Breakbulk 1. A breakbulk ship is one which transports cargo which is packed in cases, bales, cartons, drums, carboys etc., and this cargo is carried in the ship’s cargo holds rather than in containers (although some loaded containers may be carried).
2. ‘to breakbulk’ is to unload packaged cargo from a ‘breakbulk ship’ or from a container and to distribute it.
Breakbulk Cargo Cargo that is shipped in packing units such as cartons, cases, crates, bales, or drums, but not containerized.
Broker One that acts as an agent for others, as in negotiating contracts, purchases, or sales in return for a fee or commission.
Bulk Cargo Cargo that is made up of an unpacked commodity; examples include grain, oil, and ore.
Bulk Carrier A vessel designed for the shipment of bulk cargo.
Bulk Freight Cargo not in packages or containers.
Bulk Sale The transfer or sale of substantially all of an inventory of an enterprise in a single transaction not in the usual course of business.
Bulk Solids Dry cargo shipped loose, such as grain, ore, etc.
Bunker Adjustment Factor An adjustment in shipping charges to offset price fluctuations in the cost of bunker fuel.
Bunker Fuel The fuel used to power a ship.
Bunker(s) 1. A compartment (hold) of a ship for storage of fuel.
2. The fuel for a vessel
Bureau Of Alcohol, Tobacco And Firearms The Bureau of Alcohol, Tobacco and Firearms (ATF) is a law enforcement organization within the United States Department of Treasury with unique responsibilities dedicated to reducing violent crime, collecting revenue, and protecting the public. ATF enforces the Federal laws and regulations relating to alcohol, tobacco, firearms, explosives and arson by working directly and in cooperation with others.
Bureau of Industry and Security
A U.S. government agency responsible for control of exports for reasons of national security, foreign policy and short supply.
Cabotage 1. Water transportation, navigation or trade along the coasts, between the ports of one nation.
2 Inland freight movements confined with the national boundaries of a nation are also sometimes called cabotage.
Call 1. A demand for early repayment of an obligation, or for the performance of a specific act under a contract.
2. A demand for the payment of money
3. The act of redeeming a bond earlier than the full term.
4. Short for “Call Option,” a contract giving the holder the right to receive from the issuer a specified amount of a security at a specified price on or before a certain date.
5. Short for “Margin Call” – a call by a future or an options exchange, or by a broker to its clients, for additional collateral to that previously posted when the futures, options, or securities were purchased without posting their full value.
Call Money Money lent by banks on a short term basis which the bank, as lender, can “call” (demand payment at any time, usually on 24 hours notice.)
Capacity To Contract Legal competency to make a contract.
Capital Goods 1. Durable goods which are used to produce other goods for consumption: for example machinery, equipment, buildings
2. Also, material used or consumed to produce other goods.
Capital Market The market for long term investment funds in the form of stocks, bonds, commercial paper etc.
Captain’s protest A written sworn statement of the master of a vessel to the effect that damage suffered by the ship during the voyage was caused by storm or other peril of the sea, without any negligence or misconduct on his own part.
Cargo Merchandise hauled by transportation lines.
Cargo Agent An agent appointed by an airline or shipping line to solicit and process international air and ocean freight shipments.
Cargo Manifest A list of cargo being transported or warehoused.
Cargo Selectivity System (USA) An Automated Customs System module which is used to identify high risk cargo and to apply more intensive examinations to it.
Cargo Tonnage The weight of a shipment or of ship’s total cargo expressed in tons.
Carnet Called an “A T A Carnet”. An international customs document which incorporates guarantees to be used in lieu of Customs documents to enter goods into certain countries temporarily without paying import duty or posting bonds.
Carriage Of Goods By Sea Act Of 1936 (USA) The basic law of ocean shipping in the U.S. Among other provisions, it establishes parameters for the carrier’s liability for loss or damage to cargo.
Carrier A legal entity that is in the business of transporting passengers or goods for hire.
Carrier’s Certificate (USA) A document issued by a carrier providing the particulars of a shipment and designating to customs who may make a customs entry on that shipment..
Cartel A group of independent producers which regulates production, pricing, and marketing by members to maximize market power and limit competition.
Cash Against Documents (CAD) A term used in collections supported by shipping documents which are released to the buyer only against payment. Same as Documents Against Payment (D/P).
Casus Major An extraordinary casualty such as a fire, shipwreck etc.
Category Groups A classification system which groups various products for statistical, export control or quota control purposes.
Caveat Emptor Let the buyer beware, which is to say the purchaser buys at his own risk.
Cell The space constructed on a ship into which one container fits.
Census Interface (USA) An Automated Customs System module that captures trade data for the U.S. Bureau of Census.
Central Bank An institution with the sole right to issue bank notes and power to dictate the monetary policy for a currency zone.
Certificate of Inspection A certificate issued by an independent third party verifying the condition of cargo or of property.
Certificate of Manufacture 1. A certificate sometimes required from a manufacturer to attest that goods have been manufactured according to the contract; for example, to support payment under a letter of credit.
2. (USA) A form required to support a claim for duty drawback based on manufacture in the United States.
Certificate of Weight A document certifying to the weight of a shipment.
Certification 1. Official proof of authenticity.
2. The formal assertion of some fact in writing.
Cession of Goods A surrender or assignment of goods for the benefit of one’s creditors.
CFR (Cost and Freight .named port of destination) The seller must pay the costs and freight necessary to bring the goods to the named port of destination but the risk of loss of or damage to the goods, as well as any additional costs due to events occurring after the time the goods have been delivered on board the vessel, is transferred from the seller to the buyer when the goods pass the ship’s rail in the port of shipment. (Note: this Incoterm, CFR, has replaced the term C&F which has been in common usage)
Chargeable Weight The weight or volume of a shipment used in determining freight charges.
Charter Service Temporary hiring of an aircraft or vessel for the transportation of cargo or passengers.
Chartered Ship A ship leased for a stated time, voyage, or voyages.
Chassis 1. A special trailer or undercarriage on which containers are moved over the road.
2. The undercarriage of a vehicle.
CIF (Cost, Insurance and Freight. named port of destination) The seller has the same obligations as under CFR but with the addition that he has to procure marine insurance against the buyer’s risk of loss of or damage to the goods during the carriage. The seller pays the insurance premium and is only required to obtain minimum coverage.
CIP (Carriage and Insurance Paid To.named place of destination) The seller has the same obligations as under CPT but with the addition that the seller has to procure cargo insurance against the buyer’s risk of loss of or damage to the goods during the carriage. The seller pays the insurance premium and is only required to obtain minimum coverage.
Circa Same as “about” and “approx.”; terms which when used in a letter of credit are construed to allow a difference not to exceed 10% more or 10% less than the monetary amount, or the quantity, or the unit price.
City Terminal Service A service provided by some airlines that involves receiving or delivering cargo at terminals in-town instead of at airports.
Claim 1. A demand of payment.
2. In insurance, a demand for payment of money or property as the result of an insured loss..
3. In transportation, a demand for return of overpaid charges. Also, a demand for reimbursement of losses due to loss or casualty to cargo or failure to deliver.
Classification The categorization of merchandise:
In transportation – to permit determination of freight rates within a tariff.
In customs – to permit the determination of duty status within the Harmonized Tariff Schedules.
Claused Bill of Lading A notation on a bill of lading which denotes a deficient condition of the goods or packaging, or other annotated conditions modifying the printed conditions on the Bill Of Lading.
Clean Bill of Lading A bill of lading issued by a carrier for goods delivered in “apparent good order and condition” – bearing no notations or added clauses which may limit the liability of the carrier.
Clean Draft A draft with no commercial documents attached.
Clearance 1. The completion of governmental requirements so that a carrier may arrive in a port and unlade cargo and passengers, or may lade cargo and passengers and depart for a foreign destination.
2. The accomplishment of the customs formalities necessary to allow goods to be imported or to be exported.
Closed-End Transaction A credit transaction with a fixed amount of time for repayment.
Coastal Trade Trade by vessel between the ports of one nation.
Collar An agreement that puts upper and lower limits on the interest rate of a financial instrument or on the price of something, and through this device limits the possible amount of loss or gain from the rise or fall of interest or price of the thing “collared”
Collect Charges 1. Transportation practice where the receiver of the goods pays the freight and charges to the carrier.
2. Collection practice where the buyer is expected to pay the bank charges for handling the collection.
Collect on Delivery (C.O.D.) A service where the purchase price of a shipment is collected by the carrier upon delivery of the shipment and subsequently paid to the shipper.
Collecting Bank A bank involved in the collection process. In this process if presentation is made to the drawee, it becomes also “the presenting bank.”
Collection 1. The presentation for payment of an obligation and the payment thereof.
2. A gathering of similar goods.
Collection Letter Customer’s written instructions to a bank on how to handle a collection. Many banks have an instruction form for use instead of a letter.
Collection Papers Drafts, invoices, printed lists, documents which relate to a shipment, and other similar instruments presented to the designated buyer/ payee to obtain payment or acceptance.
Collection System (USA) In U.S. Customs, it is the process that controls and accounts for payments collected by the agency.
Combination Aircraft An aircraft capable of transporting both cargo and passengers on the same flight.
Combined Bill of Lading A bill of lading covering a shipment of goods by more than one mode of transportation.
Combined Transport Consignment sent by means of various modes of transport.
Comity 1. In international relations it is the recognition that one sovereignty allows within its territory to the legislative, executive or judicial acts of another sovereignty, with due regard to the rights of its own citizens.
2. Courtesy, respect, and good will.
Command Economy An economic system where the decisions about allocation of resources, production, distribution and consumption are made by a central government authority instead of being determined by market forces. An example was the Nazi economy.
Commercial Bank In the USA, a bank that is authorized to accept demand deposits. It may also receive time deposits, make loans, engage in trust services, issue letters of credit, accept and pay drafts, rent safe deposit boxes and engage in many other similar activities.
Commercial Invoice A document which details the transaction between a seller and a buyer. It minimally should give the name and address of the seller and of the buyer, the date of the sale, a description of the goods sold, the quantity, the unit price, the terms of sale, and the total money amount due. If it is an invoice between buyer and seller of different countries it should also indicate the kind of currency.
Commercial Letter of Credit An instrument by which a bank substitutes its credit for that of a customer to enable him to finance the purchase of goods or to incur other commitments. The bank issues a letter (or document) on behalf of its client to a supplier and agrees to pay them upon presentation of documentary evidence that the supplier has performed in accordance with the terms of the letter of credit.
Commercial Officers Embassy and consular officials who assist their country’s citizens and businesses in a foreign country through arranging appointments with local business and government officials and providing counsel on local trade regulations, laws, and customs.
Commercial Paper Negotiable instruments used in commerce. Usually they are short term, unsecured, promissory notes issued by highly rated entities and are traded on the money markets.
Commercial Set The documents required to evidence the shipment of goods; usually includes an invoice, packing list, and bill of lading; may include certificate of origin, certificate or policy of insurance, and other special documents.
Commercial Treaty An agreement between two or more countries that establishes the conditions under which business may be conducted between their citizens within their countries..
Commingling 1. The packing or mingling of various goods subject to different rates of duty so that the value and quantity of each class of goods cannot be readily determined.
2. To combine funds or properties into a common mass.
Commission 1. A board or committee officially appointed to perform certain functions or exercise certain jurisdiction of a public nature.
2. The amount paid by a principal to an agent for their role in the completion of a transaction involving the sale of goods or services.
3.The authority under which one acts, transacts business or negotiates for another.
Commodity Code The system of identifying a commodity by an assigned number.
Commodity Rate The rate applicable to shipping a given commodity between points.
Common Point 1. A location serviced by two or more transportation lines.
2. A significant point over which aircraft fly and report to the air controllers.
Competitive Rate Rate determined by one transportation line to compete with the rate of another transportation line.
Compradore An agent in a foreign country employed by a domestic businessman to facilitate transactions with local businesses within the foreign country.
Concealed Damage Damage to the contents of a package which is not evident from the appearance of the exterior of the package.
Concealed Loss 1. Loss from a package bearing concealed damage.
2. Damage, loss, or shortage of goods within a package which is not apparent from its exterior condition.
Confirming Bank A bank which engages to honor a letter of credit issued by another, or engages that such letter of credit will be honored by the issuer or by a third bank.
Connecting Carrier A carrier which has direct physical connection with another carrier or forms a connecting link between two or more carriers.
Consignee The person or firm named in a freight contract to whom goods have been shipped or turned over for care.
Consignment 1. Goods or property sent by the aid of a carrier from one person (the consignor) to another (the consignee).
2. Entrusting of goods to another to sell as agent for the sender.
Consignor The entity that ships goods to another. On a bill of lading, the shipper.
Consolidated Container A shipping container that contains cargo from various shippers for delivery to various consignees.
Consolidation 1. In transportation, the combining of smaller shipments into a single shipment that is sent to a destination point.
2.The reorganization of corporations to combine two or more into a successor corporation.
Consolidator A company that provides freight consolidation services.
Consular Invoice An invoice covering a shipment of goods, usually required to be certified by the counsel of the country for which the merchandise is destined. It may be required to be on a special form and be subject to the payment of special fees.
Consulate An office of a country within another country (often there are several, located in the larger commercial centers). These offices represent the commercial interests of the citizens of their country.
Consumer Goods Any goods produced for the express use of individuals rather than the production or manufacturing of other goods.
Consumption Entry (USA) A “consumption entry” is the filing with Customs in proper form of an “entry summary for consumption” on imported goods , and payment of estimated duties, taxes, and fees, if any, resulting in the release of the goods by Customs. When the release is unconditional, the importer may dispose of the goods.
Container A reusable, rigid, exterior “box” in which merchandise is shipped by air, vessel, truck, or rail.
Container Freight Charge Charge made for the packing or unpacking of cargo from ocean freight containers.
Container Load A shipment of cargo that, according to weight or volume, will fit a standard container.
Container on Flatcar A container without wheels put on railcars for transport inland,
Container Part Load A shipment of cargo that according to weight or volume will not fill a standard container on its own but is expected to be shipped in a container, if necessary with other shipments which are also too small to take up a full container themselves.
Container Vessel An ocean going vessel designed specifically to handle the loading, carriage and removal of standard freight containers.
Contraband Any product that a nation has made unlawful to possess, produce, transport, import, or export.
Contract Carrier Excluding common carriers, any person who under contract will transport passengers or goods for agreed upon compensation.
Convertibility The attribute of being exchangeable, such as a currency freely able to be exchanged for another, or as preferred stock or bonds to be exchanged for common stock.
Core Inflation The basic level of inflation over a period of time as opposed to temporary fluctuations.
Corporate Dumping The practice of exporting banned or out of date goods to a foreign market where restrictions on that product are not as severe.
Cost Plus A pricing method where the purchaser agrees to pay the production cost of the good plus a fixed percentage to the seller for profit.
Countervailing Duties (CVD) (USA) Duties which are assessed, in addition to regular duties, to offset the effects of foreign subsidies or bounties upon the export of merchandise to the United States which has been found to materially injure, or threaten material injury to, an American industry.
Country of Departure The country from which a shipment of goods, a carrier, or a passenger has or is scheduled to depart.
Country of Destination The country that is the ultimate destination for a shipment of goods. For a carrier, it is the country in which it intends to complete its current voyage or flight.
Country of Dispatch The country from which a cargo is shipped.
Country of Export Destination The country to which goods are going in order to be consumed, further processed, or manufactured, as presumed by the shipper at the time of exportation.
Country of Exportation The country from which goods are shipped with intention to separate them from the mass of goods in that country.
Country of Origin The country in which goods were produced, mined, grown or manufactured.
Country Risk The financial risks of a transaction which relate to the political, economic, or social instability of the country of the debtor, and is over and above the credit risk of the borrower.
Courier 1. Attendant who accompanies shipments.
2. Express company which handles shipments of documents and small packages on an expedited basis and may or may not have the shipments accompanied by attendants,
CPT (Carriage Paid To.named port of destination) The seller pays the freight for the carriage of the goods to the named destination. The risk of loss of or damage to the goods, as well as any additional costs due to events occurring after the time the goods have been delivered to the carrier, is transferred from the seller to the buyer when the goods have been delivered into the custody of the carrier.
Customs The government service which is responsible for the administration of Customs law and the collection of duties and taxes relating thereto, and which has responsibility for the application of other laws and regulations relative to the importation , transit, and exportation of goods.
Customs Electronic Bulletin Board (CEBB) (USA) Customs Electronic Bulletin Board (CEBB): An electronic bulletin board accessible by computer, sponsored by U.S. Customs, providing the trade community with up-to-date information, clearance requirements, and operation instructions.
DAF (Delivered At Frontier .named place) The seller fulfils his obligation to deliver when the goods have been made available, cleared for export, at the named point and place at the frontier, but before the customs border of the adjoining country.
Damages 1. A loss or harm to a person or their property.
2. The pecuniary compensation or indemnity which may be recovered by any person who has suffered loss, detriment or injury to his person, property or rights through the unlawful act, omission, or negligence of another.
Dangerous Goods Goods which are capable of posing a health or safety risk.
Date Draft A draft which matures a specified number of days after the date it is issued.
Date of Issue The arbitrary date on a contract or on a financial instrument fixed as the date from which the term runs. (Neither the actual date on the instrument, nor the date the instrument was actually signed, nor the date the instrument was executed, nor the date the instrument was delivered, are considered to be the “Date of issue” or the “issuance date”.)
DDP (Delivered Duty Paid.named place of destination) The seller fulfils his obligation to deliver when the goods have been made available at the named place in the country of importation. The seller has to bear the risks and costs, including duties, taxes and other charges of delivering the goods thereto, cleared for importation.
DDU (Delivered Duty Unpaid. named place of destination) The seller fulfils his obligation to deliver when the goods have been made available at the named place in the country of importation. The seller has to bear the costs and risks involved in bringing the goods thereto (excluding duties, taxes and other official charges payable upon importation as well as the costs and risks of carrying out customs formalities). The buyer has to pay any additional costs and bear any risks caused by his failure to clear the goods for import in time.
Deadweight 1. In maritime terms, the deadweight of a vessel is the maximum weight of the cargo, crew, stores and bunkers that it can carry when loaded so that it settles in the water to the Plimsoll line. This is also measurable by the weight of the water the vessel displaces when fully loaded less the displacement when it was unloaded.
2. Deadweight cargo is cargo of such high density that a long ton (2240 lbs.) of such cargo can be stowed in less than 70 cubic feet.
Dealer An individual or firm who purchases goods for resale.
Debtor Nation A nation that is owed less foreign currency obligations than it owes other nations.
Deck Cargo Cargo that is shipped on the deck of a vessel rather than in holds below.
Declared Value For Carriage The value of goods declared to the carrier by the shipper for the purposes of determining charges and establishing the liability of the carrier.
Declared Value for Customs The value of a shipment according to the customs laws of the destination country required to be declared by the shipper on the shipping documents or by the importer when he presents the goods for customs clearance.
Deferred Air Freight Arrangements can be made according to the tariffs of some air carriers to have less urgent freight delivered at a lower cost on later flights which are more convenient for the airline.
Deferred Payment Letter of Credit A letter of credit that allows the buyer to take possession of goods by agreeing to pay the issuing bank or the confirming bank at a fixed future date.
Del Credere Risk A situation where a sales agent sells on credit and for an additional commission guarantees to his principal the credit of the purchaser and the performance of the contract.
Delivery 1. In the case of transportation, the act of transferring physical possession.
2. The act of actually or of constructively placing goods or property within the possession or control of another.
Delivery Carrier The transport carrier whose responsibility it is to place a shipment at the disposal of the consignee at the named destination.
Delivery Instructions Specific delivery instructions for the freight forwarder or carrier stating exactly to whom, where and when goods are to be delivered.
Delivery Order A document from the consignee, shipper, or owner of freight ordering the release of freight to another party.
Demise 1. A lease of property.
2. Death. (Isn’t English an interesting language?)
Demise charter A lease of a vessel in which all control is relinquished by the owner to the charterer, and the charterer bears all the expenses of operation. Similar to bareboat charter.
Demurrage 1. In international transportation, a charge for the failure to remove cargo from a terminal within the allowed free time. Also, a charge for failure to load or unload a ship within the allowed period.
2. (USA) In domestic transportation, a penalty charge against users for use of carriers’ equipment beyond the allowed free time.
DEQ (Delivered Ex Quay – Duty Paid – .named port of destination) The seller fulfils his obligation to deliver when he has made the goods available to the buyer on the quay (wharf) at the named port of destination, cleared for importation. The seller has to bear all risks and costs including duties, taxes and other charges of delivering the goods thereto. (Note: If the parties wish the buyer to clear the goods for importation and pay the duty, the words “duty unpaid” should be used instead of “duty paid”, and other costs of importation can also be excluded from the seller’s obligations if this is made clear by adding words to this effect.)
DES (Delivered Ex Ship.named port of destination) The seller fulfils his obligation to deliver when the goods have been made available to the buyer on board the ship uncleared for import at the named port of destination. The seller must bear all the costs and risks involved in bringing the goods to the named port of destination.
Destination The place to which a shipment or person is going..
Detention The act of keeping back or withholding either accidentally or by design a person or thing.
Devanning The unloading of cargo from a shipping container.
Developed Countries A term used to describe the industrialized nations.
Developing Countries A term used to describe countries that lack strong amounts of industrialization, infrastructure, and sophisticated technology, but are beginning to build these capabilities.
Differential An amount added to or deducted from a base shipping freight rate between two given locations to determine a new rate to or from some other point or via another route.
Direct Mail Collection (DMC) A seller may forward his documents and instructions for collecting payment directly to a collecting bank in a foreign country, without going through the intermediary of the seller’s own domestic bank.
Discharge 1. To release; liberate; annul; unburden; disencounter; dismiss. To extinguish an obligation; terminate all employment of a person; release, as from prison or military services.
2. The unloading of passengers or cargo from a vessel, vehicle, or aircraft.
Discharging The unloading of cargo from a carrier, or of the contents from a container.
Discounted Bill An accepted draft against which a loan is made and the interest is deducted immediately.
Discounting 1. The sale at less than original price of a commodity or monetary instrument, often for immediate payment.
2. A loan by a bank with a deduction of the interest in advance.
Discrimination A failure to treat all persons or parties equally where no reasonable distinction can be found between those favored and those not favored. It mat be reflected in treatment, service or rates.
Dishonor 1. The refusal by a drawee to accept a draft or to pay it when due.
2. The act of disrespect or insult.
Dispatch 1.An amount paid by a vessel’s operator to a charterer if loading or unloading is completed in less time than stipulated in the charter agreement.
2. a message or report to a newspaper from a correspondent, or between government services such as state or military.
3. to send to a destination.
Distribution Service A transportation service that accepts a shipment from a shipper and at destination separates and sorts the packages and distributes them to many receivers.
Distributor An agent who sells for a supplier at wholesale and usually maintains an inventory of the supplier’s products.
Diversion Any change in the routing of a shipment once it has been received by the carrier at point of origin and prior to delivery at destination.
Dock 1. A loading or unloading platform at an industrial location or carrier terminal.
2. A ship’s berth or wharf.
Dock Examination (USA) Examination of imported merchandise by Customs at the terminal where it is discharged from the import carrier.
Dock Receipt A receipt issued by a vessel agent that certifies that goods have been received.
Documents Against Acceptance (D/A) As a procedure to collect payment on an exported shipment. instructions are given that documents necessary to obtain the merchandise from customs and the carrier are to be released to a buyer only against the buyer’s acceptance of a time draft drawn upon him.
Documents Upon Payment (D/P) As a procedure to collect payment for an export shipment, instructions are given that the documents necessary for the buyer to obtain the shipment from customs and the carrier are to be released to him only upon payment of the draft. (Same as CAD)
Dolly A piece of equipment with wheels used to move freight with or without a tractor.
Domestic Exports Exports of goods which were grown, produced, mined, or manufactured in the country from which exported.
Domicile That place where a person or organization has their principal residence with intent to make it their permanent home.
Door-To-Door Shipping service from shipper’s door to consignee’s door.
Double-Column Tariff A customs tariff schedule with two columns of rates, one for preferred trading partners and one for imports from others.
Downstream Dumping The sale of products below cost or below fair value by a producer to a another producer in its own domestic market by whom the product is then further processed and exported to another country at a price lower than would otherwise be charged and thus causing injury in that country.
Drawback (USA) A refund of duty and taxes which may be obtained upon the exportation or destruction of certain articles under certain conditions.
Drawback System (USA) An Automated Customs System module that provides the means for processing and controlling all types of drawback entries.
Dray A vehicle used to haul cargo or goods, usually drawn by a horse.
Drayage The charge made for hauling freight via carts, drays or trucks.
Drop Shipment At the request of a wholesaler, a shipment of goods from a manufacturer directly to a dealer or consumer, avoiding delivery to the wholesaler.
Drop-off The delivery of a shipment by a shipper to a carrier for transportation.
Dry Cargo Cargo which is of solid, dry material. It is not liquid or gas, and generally the term excludes cargo requiring special temperature controls.
Dry-Bulk Container A shipping container designed to carry unpackaged free-flowing dry solids such as grain or sand.
Dry-Cargo Container Any shipping container designed to transport goods other than liquids or gasses.
Dual Exchange Rate The existence of two exchange rates for a single currency for use in different circumstances as mandated by the government.
Dual Pricing The selling of identical products in different markets for different prices.
Dumping The sale of goods in a foreign country at less than” fair value” (a price lower than that at which it is sold within the exporting country or to third countries), and which thereby materially injures, or threatens to materially injure, that industry in the foreign country.
Dunnage Materials placed around cargo to prevent shifting or damage while in transit.
Durable Goods Any product which is not consumed through use.
Dutiable List The list of Items in a country’s tariff schedule on which it charges import duty.
Duty A tax levied by a government on the import or export of goods.
(Note: The U.S. Constitution forbids the levying of taxes by the U.S. on exports. However, most foreign governments do not have this restriction,)
Easement A right to use another person’s property.
Edge Act Corporations Banks that are subsidiaries either to bank holding companies or other banks established to engage in foreign business transactions.
Electronic Commerce A system of integrated communications, data management, and security services that allow business applications within different organizations to automatically interchange information.
Electronic Data Interchange (EDI) Electronic transmission of data and information according to particular protocols .
Electronic Funds Transfer System of transferring funds from one account to another by electronic means.
Electronic Meat Health Certificate (USA) A demonstration project that illustrates the electronic transmission of fresh meat health certificates.
Electronic Visa Information System (ELVIS) (USA) An electronic data system via which participating foreign governments transmit electronically to the U. S. Government details of shipments of quota controlled textile goods they have made to the U.S.
Embargo A government prohibition of exports or imports with respect to specific products or specific foreign countries.
En Route In transit (referring to goods, passengers, or vessels).
Entrepot An intermediary storage facility (often in an intermediate country) where goods are kept temporarily for distribution.
Entrepot Trade The import and export of goods which receive no further processing but are distributed from the entrepot facility which is chosen for its location and lack of restrictions on trade,
Entry 1.That documentation required to be filed with the appropriate customs officer to secure the release of imported merchandise from customs custody.
2. The act of filing that documentation.
Entry Documents The documents required to complete customs entry to secure the release of imported merchandise.
Entry Summary (USA) Documentation which is necessary to enable US Customs to collect duties, collect statistics, and determine whether other requirements of law or regulations are met upon importation. In the US, the importer must classify the goods, determine their customs value, and calculate duties, taxes and fees.
Entry Summary System (USA) An Automated Customs System module that automates the entry processing cycle.
Environmental Protection Agency (EPA) (USA) An independent agency in the executive branch whose mandate is to control and abate pollution in the areas of air, water, solid waste, pesticides, radiation, and toxic substances.
Equalization In transportation, a money allowance given the customer if the transport company picks up the goods at origin points or delivers them to destination points other than those named on the bill of lading.
Escape Clause 1. A provision in a bilateral or multilateral commercial agreement permitting a signatory nation to change their obligations when imports threaten serious harm to the producers of competitive domestic goods.
2. A provision in a contract or other document permitting parties to avoid liability for nonperformance under certain conditions.
ETA The expected date and time of arrival of a carrier.
ETD The expected date and time of departure of a carrier.
Eurobond A bond issued in a Euro-currency, usually Euro-dollars
Ex Factory This term is still widely used but it is being replaced by the Incoterm EXW – Ex Works. It is a sale term where the title to goods passes to the buyer when they leave the vendor’s dock and consequently at that point the liability for loss or damage and the expenses of shipment also pass from vendor to buyer.
Exchange Rate The price of one currency expressed in terms of another.
Excise Tax Taxes on the manufacture, sale, or consumption of goods, or upon licenses to pursue certain occupations, or upon corporate privileges. In current usage it covers various license fees imposed by government and practically every internal revenue tax from any source except the income tax.
Exculpatory Clause 1. A contractual clause that releases one party from liability in case of wrong doing by the other party involved.
2. A contractual clause which excuses a trustee from liability where he executes a power in good faith.
Expiry Date The “End”, specifically: the cessation; termination by lapse of time as the expiration of a lease, insurance policy, or statute. Coming to a close or termination. The expiry date is the date on which these events occur. It is the last date that options or warrants can be executed.
Export To send or transport goods abroad out of a customs territory; to sever them from the mass of things belonging to one country with the intention of uniting them to the mass of things belonging to a foreign country.
Export Broker A firm that specializes in bringing foreign buyers and domestic sellers together for a fee but usually does not participate in the actual business transaction.
Export Control The establishment of procedures for the governmental control of exports for statistical or strategic purposes.
Export Declaration (USA) The Shipper’s Export Declaration is a required customs document for exportation of goods from the United States which provides statistics and facilitates control where applicable.
Export Draft A documentary order in the form of a draft drawn on the importing party to pay the seller for the exported goods.
Export Duty A tax imposed by some nations on their exports.
Export License A license issued to exporters by governments to permit them to export certain goods to certain countries. Such goods may be of strategic importance, or simply in short supply, or are controlled to comply with foreign agreements.
Export Management Company A private firm that serves as the export department for several manufacturers and handles the exporting aspect of the business for a commission or fee.
Export Merchant A company that buys domestic and foreign products and sells to foreign purchasers. Usually an export merchant is able to compete