Trade glossary

A drawee signing a time draft to confirm it will pay on the due date, turning the draft into a binding promise.

Charges for services beyond simple carriage — waiting time, inside delivery, redelivery — that sit outside the quoted freight rate.

A duty calculated as a percentage of the goods’ customs value, rather than by weight, volume or unit.

Payment made by the buyer before the goods are shipped, placing the commercial risk almost entirely on the buyer.

A message sent ahead of a delivery telling the receiver what is coming, in what packaging, and when.

The fee a shipping agent charges an owner or operator for handling a vessel’s business at a port.

A party authorised to act on another’s behalf — booking cargo, clearing customs or handling a vessel — without owning the goods.

Several separate consignments combined and moved as one, usually to obtain a better rate than each would earn alone.

Goods carried by aircraft, typically where speed, value or perishability outweighs the higher cost per kilogram.

An airline that carries goods for hire, under its own air waybill and operating licence.

The transport of goods by aircraft, and the charge made for it.

The transport document for air cargo: a contract of carriage and receipt, but not a document of title.

A container built to the contours of an aircraft hold, also called a unit load device.

Beside the vessel, within reach of its lifting gear — the delivery point that defines the Incoterms rule FAS.

An extra duty imposed on imports found to be sold below normal value, where that pricing injures a domestic industry.

A carrier’s statement that goods looked undamaged externally when received — it says nothing about the contents.

A notice from the carrier or agent telling the consignee that goods have arrived and what must happen before release.

The cost of returning or onward-carrying goods the consignee will not or cannot accept at destination.

The return leg of a transport movement, often priced low because the vehicle would otherwise travel empty.

Bunker Adjustment Factor: a surcharge that passes changes in marine fuel prices through to the freight rate.

The difference between the value of a country’s exports and its imports of goods over a period.

A payment instrument drawn by a bank on itself or on another bank, used where a buyer’s own cheque would not be accepted.

A bank’s undertaking to pay a beneficiary if its customer fails to perform an obligation.

The direct exchange of goods for goods without money changing hands.

The party entitled to receive payment under a letter of credit or guarantee — normally the seller.

Between two parties or two countries, as in a bilateral trade agreement.

A written order requiring one party to pay a specified sum to another, on demand or at a stated future date.

The core sea transport document: receipt for the goods, evidence of the carriage contract, and — when negotiable — a document of title.

A document transferring ownership of goods from seller to buyer.

A single rate applied across a range of origins, destinations or commodities rather than priced individually.

A port where goods may be landed and held under customs control without duty being paid.

Goods held under customs control with duty and tax suspended until they are cleared or re-exported.

A customs-approved warehouse where imported goods are stored with duty and tax suspended until removal.

A reservation of space on a specific vessel, flight or vehicle for an identified shipment.

Goods shipped as individually handled pieces — crates, drums, bales — rather than in containers or as bulk.

A ship designed to carry individually handled cargo, usually fitted with its own cranes.

Space in a hold or container that cannot be used because of the shape of the cargo.

An intermediary who arranges a transaction between two parties without taking ownership of the goods.

Unpackaged homogeneous cargo — grain, ore, oil — loaded loose into a hold or tank.

Securing several pieces into one handling unit so they move and are counted as a single item.

The carriage of goods between two points within one country, often reserved by law to that country’s own carriers.

Currency Adjustment Factor: a surcharge covering exchange-rate movement between the carrier’s pricing and settlement currencies.

Goods carried by a vessel, aircraft or vehicle for commercial purposes.

The statement of a conveyance’s cargo made to customs on arrival or departure.

A list of all cargo carried on a conveyance, compiled from the transport documents issued for it.

An international customs document allowing goods to be temporarily imported without paying duty, provided they are re-exported.

The party that undertakes to transport goods under a contract of carriage.

A carrier’s right to retain goods until freight and related charges are paid.

Short-distance road haulage, typically between a terminal and a nearby premises.

A payment arrangement where shipping documents are released to the buyer only against payment.

Payment in full before shipment — the most secure term for a seller, the least for a buyer.

Payment collected at the point of delivery, usually by the carrier on the seller’s behalf.

A manufacturer’s declaration that a product meets the EU requirements that apply to it.

A document attesting that goods meet a specified standard or regulation.

A document confirming that goods are legally sold in the exporting country, often required for food, cosmetics or medical products.

A document confirming that goods were examined before shipment and matched what was specified.

Evidence that a shipment is covered by cargo insurance, issued under an existing open policy.

A document stating the country in which goods were produced, used for preference claims and origin-based restrictions.

Incoterms rule: the seller pays carriage to the named destination port, but risk passes when goods are on board at origin.

Container Freight Station: a facility where less-than-container loads are consolidated into, or stripped out of, containers.

A business body that, among other functions, certifies certificates of origin and commercial documents.

Legally binding notes at the head of each HS chapter that govern what the chapter does and does not cover.

The weight a shipment is billed on: the greater of its actual weight and its volumetric weight.

The contract under which a charterer hires a vessel or part of its capacity from its owner.

The party that hires a vessel, or space on it, from the owner under a charter party.

A wheeled frame used to carry a container by road.

Incoterms rule: the seller pays carriage and minimum insurance to the destination port, but risk still passes on board at origin.

Incoterms rule: the seller pays carriage and insurance to a named destination, with risk passing at first-carrier handover.

A demand for compensation for loss of or damage to goods, made against a carrier or an insurer.

A bill of lading with no notation recording defective goods or packaging.

Freight payable by the consignee at destination rather than by the shipper at origin.

Carriage using more than one mode under a single contract and a single document.

The seller’s bill for the goods, and the primary document customs uses to establish value.

A good traded in commerce; in customs usage, the article being classified and declared.

The tariff classification number assigned to goods, on which duty and controls depend.

A carrier that offers transport to the public generally, and cannot arbitrarily refuse a lawful shipment.

Damage to goods inside packaging that appeared sound on delivery, discovered only when the packaging is opened.

An association of ocean carriers on a trade lane that historically set common rates and conditions.

Of a letter of credit: carrying a second bank’s independent undertaking to pay, in addition to the issuing bank’s.

An intermediary that places orders with exporters on an overseas buyer’s behalf and guarantees payment.

A carrier that performs part of a journey and hands the goods to another to continue.

The party named to receive the goods at destination.

Goods sent together under one transport document; also, goods supplied for sale with payment due only when sold.

The party sending the goods, named as such on the transport document.

Combining several shippers’ consignments into one container or load to obtain a better rate.

A party that combines multiple shippers’ cargo into full loads and issues its own transport documents.

A government official in a foreign country who may certify or legalise trade documents.

An invoice on a prescribed form certified by the destination country’s consulate before shipment.

A customs entry declaring goods for use within the importing country, with duty and tax payable.

A standardised steel box designed to be transferred between ship, rail and road without unpacking the goods inside.

A road trailer built to carry a container.

A facility where empty containers are stored, inspected and repaired between uses.

A facility where less-than-container-load cargo is packed into, or unpacked from, containers.

The quantity of goods filling a container; also used to distinguish full-container from less-than-container shipments.

A list of everything packed inside a particular container.

A vessel built to carry containers in cellular holds and stacked on deck.

The part of a port equipped to load, discharge and store containers.

The area where containers are received, stored and delivered; also a shorthand for full-container-load terms.

The shift to moving general cargo in standardised containers rather than as individually handled pieces.

Goods whose import or export is prohibited, or which are moved to evade customs control.

A currency that can be freely exchanged for others without official restriction.

Arrangements where payment is made wholly or partly in goods or services rather than money.

Duties imposed to offset a subsidy given to producers in the exporting country, where that subsidy injures a domestic industry.

The country where goods were produced, or last substantially transformed — not necessarily where they were shipped from.

Incoterms rule: the seller pays carriage to a named destination, but risk passes when goods reach the first carrier.

To fill a container’s volume before reaching its weight limit.

The internal volume available in a container, hold or vehicle.

A surcharge covering exchange-rate movement between the carrier’s pricing and cost currencies.

The office where customs business for a port or district is transacted.

The government authority responsible for controlling goods crossing a border and collecting duties and taxes on them.

A customs-approved warehouse where imported goods are held with duty suspended.

A licensed agent that prepares and files customs declarations on an importer or exporter’s behalf.

The completion of customs formalities allowing goods to be released for import, export or transit.

The formal statement to customs of what is being imported or exported, its classification, value and origin.

A tax levied on goods when they cross a customs border, calculated from classification, value and origin.

The declaration lodged with customs to place goods under a customs procedure.

An invoice on a form prescribed by the importing country, carrying the details customs requires.

The value on which ad valorem duty is calculated — normally the transaction price, adjusted by prescribed additions.

The deadline for delivering cargo or documents for a specific sailing or flight.

Goods that pose a risk in transport and are subject to classification, packing, marking and documentation rules.

The shipper’s signed statement classifying hazardous cargo and confirming it is packed and marked correctly.

Incoterms rule: the seller delivers at a named destination, ready for unloading, with import clearance left to the buyer.

A draft payable a fixed number of days after its own date, rather than after sight or acceptance.

Incoterms rule: the seller bears everything to the buyer’s door, including import clearance, duty and taxes.

A withdrawn Incoterms rule, replaced by DAP in 2010 — still widely quoted despite no longer existing.

Freight payable on booked space that the shipper failed to use.

A value stated to the carrier which may raise its liability limit above the standard cap, usually for a fee.

The place where a consolidated shipment is broken down into its individual consignments.

A rebate paid to a shipper only after a further period of exclusive custom, historically used to secure loyalty.

Instructions telling a carrier or terminal where and how goods are to be delivered.

A document instructing whoever holds the goods to release them to a named party.

A signed acknowledgement that goods were delivered, and in what apparent condition.

A charge for keeping equipment or cargo beyond the free time allowed, typically inside a terminal.

The weight of goods relative to the space they occupy, which determines how they are rated.

A charge for holding a carrier’s container outside the terminal beyond the free time allowed.

Unloading cargo from a container.

A departure from the agreed or customary route, which can affect a carrier’s liability and cargo insurance.

A weight derived from a shipment’s volume, used for pricing when goods are bulky relative to their mass.

Selling directly to a buyer in another country, without an intermediary in between.

A bill of lading carrying a notation that the goods or packaging were defective when received.

A mismatch between documents presented under a letter of credit and what the credit requires.

A party that buys goods for resale in a market, taking title and commercial risk.

Changing a shipment’s destination or consignee after it has already been despatched.

A structure or area where vessels are loaded and unloaded; also a loading bay at a warehouse.

A receipt acknowledging that goods were delivered into the carrier’s custody at the terminal.

A payment method in which banks pass shipping documents to the buyer against payment or acceptance, without guaranteeing payment.

A bank’s undertaking to pay against compliant documents — the formal name for a letter of credit.

A collection in which documents are released once the buyer accepts a draft, with payment due later.

A collection in which documents are released only when the buyer pays.

Incoterms rule: the seller delivers and unloads at the named destination; the only rule requiring the seller to unload.

A refund of duty paid on imported goods that are later exported, often after processing.

The party a draft is addressed to, and who is required to pay it.

The party that creates a draft and orders the drawee to pay.

Short-haul road movement of containers between port, rail terminal and nearby premises.

Exporting goods at less than their normal value in the home market, which may attract antidumping duty.

The portion of a shipment’s value on which duty is assessed.

A tax charged on goods crossing a customs border, determined by classification, customs value and origin.

A refund of import duty where the goods, or products made from them, are exported.

The structured exchange of business documents between computer systems in an agreed format.

A prohibition on trade with a country, entity or in particular goods.

What imported or exported goods will actually be used for, which can determine licensing or duty treatment.

The party that will ultimately use the goods, as distinct from any intermediary in the transaction.

A signature transferring rights under a negotiable document to another party.

The act of declaring goods to customs and placing them under a customs procedure.

A record of a container’s condition at the moment responsibility for it passes between parties.

Estimated time of arrival: the expected arrival of a vessel, aircraft or vehicle.

Estimated time of departure: the expected departure of a vessel, aircraft or vehicle.

A noted irregularity — damage, shortage, overage — recorded against a shipment on delivery or receipt.

The rate at which one currency converts to another, including the rate customs uses to value imports.

The WCO’s official commentary on the Harmonized System, used to interpret headings.

To send goods out of a customs territory, and the goods so sent.

An intermediary that brings exporters and foreign buyers together for a commission.

Rules restricting the export of specified goods, software or technology, usually by destination and end use.

Government authorisation to export specified goods, often to a named destination and end user.

A firm that runs the export function on behalf of manufacturers, usually under its own agreements.

A designated area where imported inputs are processed for export under relaxed duty treatment.

Limits on the quantity of specified goods that may be exported in a period.

Government support conditional on exporting, which can expose the goods to countervailing duty abroad.

A firm that buys domestically and sells abroad on its own account, or exports for others.

Incoterms rule: the seller makes goods available at its own premises; the buyer bears everything from that point, including export clearance.

Freight All Kinds: a single rate applied to mixed cargo regardless of what it is.

Incoterms rule: the seller delivers alongside the vessel at the named port; risk passes there.

Incoterms rule: the seller delivers goods, cleared for export, to a carrier at a named place.

A smaller ship carrying containers between a hub port and smaller ports on the same network.

Forty-foot equivalent unit: a container capacity measure equal to two TEU.

A container with no sides or roof, used for cargo too large or awkward for a closed box.

Incoterms rule: the seller delivers goods on board the vessel at the named port; risk passes on board.

A contract clause excusing performance prevented by events outside a party’s control.

A designated area treated as outside the customs territory, where goods can be held or processed with duty deferred.

A capacity measure equal to one forty-foot container, or two TEU.

The period during which cargo or equipment may be held without demurrage or detention accruing.

A designated area where goods may be landed, handled and re-exported without customs duty.

The charge for carrying goods; also, the goods being carried.

A carrier’s invoice for transport charges.

An intermediary that arranges transport between shippers and carriers without operating vehicles.

The amount payable for carriage, excluding accessorial and terminal charges.

Freight payable by the consignee on arrival.

A company that arranges transport and documentation on a shipper’s behalf, often issuing its own transport document.

Freight paid by the shipper at origin rather than by the consignee at destination.

A consignment of goods moved by a commercial carrier.

Free trade agreement: a treaty reducing or removing tariffs between its parties for originating goods.

A shipment large enough to occupy an entire vehicle, moved without consolidation.

A point where goods enter or leave a country or transport network, or transfer between services.

The 1947 agreement that established multilateral tariff rules, now administered within the WTO framework.

The status of imported goods not cleared within the permitted period, moved to a designated warehouse.

The total permitted weight of a vehicle including its load, fuel and crew.

The total weight of goods including packaging, pallets and any container.

Goods and Services Tax: a consumption tax charged on imports and generally zero-rated on exports.

A sheltered body of water where vessels can anchor or berth.

The WCO’s international goods nomenclature, providing the first six digits of every country’s tariff code.

The road or rail movement of goods, particularly the inland legs of a container journey.

Goods presenting a risk in transport, subject to classification, packing and declaration rules.

A transport document issued by a forwarder or NVOCC to its customer, rather than by the actual carrier.

The International Air Transport Association, whose rules govern much of air cargo documentation and dangerous goods.

The International Maritime Dangerous Goods Code, governing hazardous cargo carried by sea.

To bring goods into a customs territory, and the goods so brought.

Government authorisation required before certain goods may be imported.

Limits on what may be imported — prohibitions, quotas, licensing or conditions of entry.

The party legally responsible for a customs entry, its accuracy and the duty payable on it.

Goods moving or stored under customs control with duty suspended.

ICC rules defining the delivery, cost and risk obligations of buyers and sellers — but not title, payment or governing law.

Selling abroad through an intermediary in the seller’s own country rather than directly to the foreign buyer.

A transport document covering the domestic leg of a journey to or from a port.

A carrier moving goods between an inland point and a port or terminal.

A document recording that goods were examined and conform to what was specified.

Evidence that a specific shipment is covered under an existing insurance policy.

Rights in trade marks, patents, designs and copyright, which customs can enforce at the border.

Where responsibility for goods or equipment passes from one carrier to another.

A reusable mid-sized container for liquids or granulated goods, sized between a drum and a bulk tank.

A party that receives goods in transit and forwards them to the ultimate consignee.

Moving goods in one loading unit across two or more modes without handling the goods themselves.

The business organisation that publishes the Incoterms rules and the UCP for documentary credits.

A seller’s demand for payment, itemising goods, quantities, prices and terms.

The declaration of a conveyance’s cargo made to customs on arrival from abroad.

A letter of credit that cannot be amended or cancelled without the agreement of all parties.

The international standard requiring wood packaging to be treated and marked against pests.

A commercial arrangement in which two or more parties share an enterprise, its control and its risk.

The total cost of getting goods to their destination: price, freight, insurance, duty, taxes and handling.

Less than container load: a shipment too small to fill a container, consolidated with others.

A road shipment too small to justify a whole vehicle, consolidated with other consignments.

A bank’s undertaking to pay a seller against documents that comply exactly with the credit’s terms.

Customs’ final determination of the duty owed on an entry, closing it.

The planning and management of the movement and storage of goods through a supply chain.

A list of everything carried on a conveyance, compiled from its transport documents.

Relating to the sea, and to the body of law and practice governing shipping.

Identifying information applied to packages, and legally required labelling such as country of origin.

The officer in command of a merchant vessel.

The transport document issued by the actual carrier, covering a consolidated container as a whole.

A deck officer ranking below the master; the chief mate signs for cargo received.

Master air waybill: the air carrier’s document covering a consolidated air shipment.

A weight derived from a shipment’s volume, used where cargo is bulky relative to its mass.

A non-negotiable copy of a bill of lading issued for information only.

A party trading goods on its own account; in carrier terms, a broad definition covering everyone with an interest in the cargo.

A measure of 1,000 kilograms; also used for a freight unit of one cubic metre or one tonne, whichever is greater.

The lowest charge a carrier will raise for a shipment regardless of its size.

The smallest amount payable for a service, applied when the rated amount falls below it.

Declaring goods under the wrong tariff code, whether by error or design.

A consignment containing goods of different classes, commodities or tariff codes.

The means by which goods move: sea, air, road, rail or inland waterway.

Securing a vessel to a berth, buoy or anchorage.

The WTO principle that a tariff concession given to one member must be given to all members equally.

A company that transports goods by road for hire.

A ship propelled by internal combustion engines, abbreviated MV before a vessel’s name.

Carriage by two or more modes under a single contract.

Of a document: transferable by endorsement or delivery, carrying rights to the goods with it.

A measure of a ship’s usable cargo volume, used for port dues and canal charges.

The weight of the goods alone, excluding packaging, pallets and container.

An insurance basis that replaces damaged property without deducting for depreciation.

Naming a vessel, carrier, agent or facility that a contract requires the other party to use.

A carrier that issues its own transport documents and takes carrier liability without operating ships.

The party a carrier informs when goods arrive, who need not be the consignee.

The count of separate handling units in a shipment, as recorded on the transport document.

A party that acts as carrier and issues its own bills of lading without owning or operating vessels.

A bill of lading issued for carriage by sea, which may be negotiable and act as a document of title.

A company operating vessels that carry goods by sea for hire.

A non-negotiable sea transport document releasing goods to a named consignee.

A container facility outside the port, used to relieve pressure on quayside space.

A proposal to contract on stated terms, capable of being accepted to form a binding agreement.

An inspection certificate issued by a government body rather than a private inspector.

Cargo carried on the weather deck rather than in a hold, with different risk and insurance treatment.

A payment arrangement where goods are shipped and paid for later, on agreed credit terms.

A standing cargo insurance policy covering all shipments meeting its terms, without individual arrangement.

A container with a removable roof, allowing cargo to be loaded from above.

Where goods were produced, or where a transport movement begins — two different meanings worth separating.

A signed original of a bill of lading, one of which must usually be surrendered to obtain the goods.

Cargo exceeding the dimensions of the container or vehicle carrying it.

Moving away from a location or out of a country; the export direction.

The quantity and condition of cargo as actually discharged, compared with what was shipped.

Customs permission for a vessel to depart, granted once its formalities are complete.

More cargo delivered than the documents record — the opposite of a shortage.

An outer enclosure combining several packages into one handling unit.

A single item of packing presented for carriage, and the unit many liability limits are calculated on.

Material protecting goods in transit, which may itself be regulated and dutiable.

The act of preparing goods for carriage, and the manner in which they are packed.

A document itemising a shipment’s contents package by package, with weights and dimensions.

A note accompanying goods listing what the consignment contains.

A platform on which goods are stacked so they can be moved as one unit by forklift.

Assembling goods onto pallets so they can be handled as single units.

The largest vessel size able to transit the Panama Canal’s original locks.

A small package sent by courier or post; also, a defined quantity of bulk cargo.

A partial loss affecting one interest, borne by that party alone rather than shared.

The party to whom a payment or instrument is to be paid.

The weight of cargo a vehicle, container or aircraft can carry, excluding its own weight.

The agreed method and timing of payment for goods.

A guarantee that compensates the buyer if the seller fails to perform the contract.

Goods that deteriorate over time or outside a temperature range, requiring controlled conditions.

Official authorisation for an act that would otherwise be restricted.

An official certificate confirming that plants or plant products meet the importing country’s health requirements.

Where the carrier’s responsibility for the goods ends under the transport contract.

Where the carrier takes the goods into its charge under the transport contract.

Where a transport movement begins — not necessarily where the goods were produced.

A place where vessels load and discharge, together with its facilities and customs administration.

A port a vessel visits during a voyage.

A port authorised to receive imports, where customs formalities may be completed.

The place from which goods leave a country.

Charges paid at origin by the shipper rather than at destination by the consignee.

Determining the tariff code under which goods fall, which decides duty and applicable controls.

A preliminary invoice issued before shipment, used for quotations, permits and payment arrangements.

Detention of goods, animals or plants pending inspection or treatment for health risks.

A limit on the quantity of specified goods that may be imported or exported in a period.

A statement of price and terms on which a supplier is prepared to sell.

An origin test requiring a minimum proportion of a good’s value to arise within the trade agreement’s area.

A transfer of funds in settlement of an obligation.

A vessel or service where wheeled cargo is driven on and off rather than lifted.

A restrictive measure against a country, entity or individual, prohibiting or limiting dealings with them.

The party that tenders goods for carriage and is named as such on the transport document.

A company that transports goods, whether by sea, air, road or rail.

A draft payable immediately on presentation to the drawee.

The placing and securing of cargo within a vessel or container.

An undertaking by a third party to answer for another’s obligation, often required by customs.

A schedule of duties applied to imported goods; also, a carrier’s published schedule of rates.

The tariff code assigned to goods, and the process of determining it.

Twenty-foot equivalent unit: the standard measure of container capacity.

Outsourcing warehousing, fulfilment and transport management to a specialist provider.

A single transport document covering carriage over successive legs, possibly by different carriers.

A draft payable at a fixed future date rather than on presentation.

A business that buys and sells goods internationally on its own account.

Transferring cargo from one vessel or vehicle to another during a journey.

A shipment filling a vehicle, moved without consolidation.

A container or pallet shaped to fit an aircraft hold, loaded as a single unit.

The period during which a licence, credit, quotation or certificate remains effective.

Determining the value of goods for customs purposes, on which ad valorem duty is charged.

A ship or craft used to carry goods or passengers by water.

Hiring a vessel for a specific voyage, with the owner operating it and freight paid per tonne or as a lump sum.

A voluntary relinquishment of a right, or permission to depart from a requirement.

A building for storing goods, which may operate under customs control.

A non-negotiable transport document naming the consignee, which does not have to be surrendered.

A weight band in a rate schedule, where the rate per unit falls as the band rises.

Leasing an aircraft together with crew, maintenance and insurance.

A structure alongside which vessels berth to load and discharge.

A charge for using a wharf, levied on cargo passing over it.

The operator of a wharf, responsible for goods while they are in its charge.

Removing goods from a bonded warehouse, at which point duty normally becomes payable.

The World Trade Organization, which administers the multilateral trade agreements and settles disputes between members.

A designated area with its own customs or pricing treatment, such as a free zone or a shipping rate zone.