A-1: Term used to
signify a first class ocean vessel.
A/P: Abbreviation for AUTHORITY TO PAY.
AACO: See Arab Air Carriers Organization.
AAD: See ADVANCE AGAINST DOCUMENTS.
AAR: See ASSOCIATION OF AMERICAN RAILROADS.
AB: The abbreviation for Aktiebolaget, a joint stock company in Sweden. Also AKTB.
ABANDONMENT: 1) Proceeding where a carrier seeks authorization to stop service over all or part of its route/line or to give up ownership/control of cargo or vessel. 2) Shipper or consignee relinquishes damaged freight to carrier or refuses to accept delivery. 3) In marine insurance, giving up title to partly destroyed property to the insurers. 4) The act of relinquishing title to damaged or lost property in order to claim a total loss.
ABS: See AMERICAN BUREAU OF SHIPPING.
ABI: See Automated Brokerage Interface.
ABC analysis: The classification of items in an inventory according to importance defined in terms of criteria such as sales volume and purchase volume.
ABSOLUTE LIABILITY: Condition in which carrier is responsible for all liability and is not protected by the normal exemptions found in the Bill of Lading or common law liability.
ABSORPTION: Acceptance by a carrier of a portion of a joint rate or change which is less in amount than that which it would receive for the service in the absence of such joint rate or charge.
ABSTRACT: Abridgement of evidence omitting non-essential items. Used especially in regulatory proceedings.
ACCEPTANCE: 1) Acknowledged receipt by consignee of a shipment terminating the common carrier’s contract. 2) A promise to pay usually evidenced by inscribing across the face of the bill “accepted“, followed by the date, the place payable and the acceptor’s signature. (Broadly speaking, any agreement to purchase goods under specified terms. An agreement to purchase goods at a state price and under stated terms.)
ACCESSORIAL CHARGES: Charges for supplementary services and privileges provided in connection with line-haul transportation of goods. These charges are not included in the freight charge and usually take the form of a flat fee. Some examples are pickup/delivery, in-transit privileges, demurrage, switching, loading/unloading, weighing, storage, inspection, grading, repackaging, billing, fabrication, etc.
ACCESSORIAL SERVICES: Services performed in addition to the normal transportation service. Common accessorial services include advancement of charges, pickup, delivery, COD Service, signature service, storage etc.
ACCOUNT NUMBER- An identifying number issued to identify a shipper and/or consignee. The number ensures accurate invoicing procedures and customer traffic activity.
ACH: See Automated Clearinghouse
ACI: See AIR CARGO, INC. or Airports Council International.
ACS –See Automated Commercial System
ACT OF GOD: Operation of an uncontrollable natural force. A natural event, not preventable by any human agency, such as flood, storms, or lightning. Forces of nature that a carrier has no control over, and therefore cannot be held accountable.
Activity-based costing: An accounting system based on the true cost of specific activities performed in an organization.
ACTUAL GROSS WEIGHT: The sum of the container weight, tractor pulling it and the payload contained in it.
ACTUAL PAYLOAD: Actual weight of commodity being transported (actual gross weight minus tare weight).
ACTUAL VALUATION: Actual value of goods shown on Bill of Lading by shipper when rate to be applied depends on value.
AD HOC: Latin phrase meaning “for this”. In business used to indicate a single end or purpose, a onetime application e.g., an “ad hoc” investigating committee.
Ad Hoc Charter: A one-off charter operated at the necessity of an airline or charterer.
AD VALOREM: Latin phrase meaning “according to value”. Freight rates set at a certain fixed percentage of the value of articles. E.g. The wholesale price of the articles, are known as “ad valorem” rates.
AD VALOREM DUTY: Tax imposed on imported merchandise assessed as a percentage of its value.
ADB: See Asian Development BANK
ADD-ON: A term equivalent to proportional, arbitrary or construction rate.
Admiralty Court: A court having jurisdiction over maritime questions pertaining to ocean transport, including contracts, charters, collisions, and cargo damages.
ADP: Abbreviation for “Automated Data Processing”.
ADVANCE AGAINST DOCUMENTS (AAD): A loan made on the security of the actual documents covering a shipment.
ADVANCE ARRANGEMENTS- The shipment of certain classes of commodities in air freight-examples: gold, precious gems, furs, live animals, human remains, and oversized shipments- require arrangements in advance with carriers: The shipper or it’s agent must contact the carrier prior to tendering the consignment.
ADVANCE FREIGHT: Partial payment of the Bill of Lading freight in advance. In other respects is the same as guaranteed freight.
ADVANCED CHARGE: Freight or charge on a shipment that is advanced by one transportation company or another, or to the shipper, to be collected from the consignee.
Advanced Technology Products: About 500 commodity classification codes used in reporting U.S. merchandise trade are classified as "Advanced Technology" which meet the following criteria: The technology is from a recognized high technology field, the products employ leading edge technology in that field; and such products constitute a significant part of all items covered in the commodity classification code.
ADVANCEMENT OF CHARGES: A service under which carriers, in some instances, pay incidental charges. Examples would include cartage and warehousing costs. These charges can be in advance for the convenience of either the shipper or their receiver. Generally abbreviated “PBA” (“Paid by Agent”) on Air Waybills.
ADVICE OF SHIPMENT: Notice to local or foreign party that shipment has occurred with details of packing, routing, etc. A copy of the invoice is usually enclosed and sometimes a copy of the Bill of Lading.
Advising Bank: A bank that receives a Letter of Credit from an issuing bank, verifies its authenticity and forwards the original Letter of Credit to the exporter without obligation to pay.
ADVISORY CAPACITY: A term used when the powers of a shipper’s agent or representative aboard are limited and he is not authorized to make definite decisions and adjustments without reference to his principals.
AERP: See Automated Export Reporting Program
AEV: See ARTICLES OF EXTRAORDINARY VALUE.
AFFIDAVIT: Written statement which must be witnessed and sworn to before a notary public or other officer who has authority to administer oaths or affirmations.
Affiliate: A company that controls, or is controlled by another company, or is one of two or more commonly controlled companies.
AFLOAT: Commodities underway in water transit, either actually aboard vessels at sea or in port but not yet unloaded.
AFTER DATE: When a DRAFT bears this phrase, the time begins to run its date. The date of maturity is therefore fixed and does not depend upon presentation or acceptance.
AFTER SIGHT: When a DRAFT bears this phrase, the time begins to run from its presentation or acceptance.
AG: The abbreviation for Aktien-Gesellschaft, a joint stock company in Germany.
AGAINST: In international trade, used as a synonym for “upon”.
Agency Agreement: The steamship line appoints the steamship agent and defines the specific duties and areas of responsibility of that agent.
AGENT: 1) A person or organization authorized to act and/or transact business for and in the name of another person or organization. 2) A broker.
Agent of Change: The professional who lobbies for new ways of doing business.
AGGREGATED SHIPMENTS: Several shipments from different shippers to a single consignee, consolidated and treated as single consignment.
AGIO: Premium paid for exchange of one currency for another.
AGVS: See automated guided vehicle system.
AIR CARGO: Any property (freight, mail, express) carried or to be carried in an aircraft. Does not include passenger baggage.
AIR CARGO, INC. (ACI): A ground service corporation established and jointly owned by the United States scheduled airlines. In addition to its airline owners, ACI also serves over 30 air freight forwarders and international air carriers. One of ACI’s major functions is to facilitate the surface movement of air freight by negotiating and supervising the performance of a nationwide series of contracts under which trucking companies provide both local pickup and delivery service at airport cities and over-the-road truck service to move air freight to and from points not directly served by the airlines. ACI publishes a directory of these trucking services, listing over 19,000 points served in the United States and the applicable pickup and delivery rates. Other services include claims inspection, terminal handling, telemarketing service, and group purchasing (equipment, supplies, insurance). ACI also makes available, in many cities, low cost, disposable containers for shippers' use. For further information: 1819 Bay Ridge Avenue, Annapolis, MD 21403
AIR CARGO GUIDE: A basic reference publication for shipping freight by air. It contains current domestic and international cargo flight schedules, including pure cargo, wide body and combination passenger-cargo flights. Each monthly issue also contains information on air carriers' special services, labeling, airline and aircraft decoding, air carrier and freight forwarders directory, cargo charter information, United States and Canadian city directory small package services, interline air freight agreements, aircraft loading charts and more. For information: 2000 Clearwater Drive, Oak Brook, IL 60521-9953.
AIR EXPRESS: A term often used to describe expedited handling of air freight service. See also PRIORITY AIR FREIGHT.
AIR FREIGHT: A service provided for the transport of goods in any volume. Air freight is by far, the predominant form of air cargo and accounts for over 80% of all air cargo movements. Each shipper's decision to move goods by air turns on one or more of these basic factors: The time factor, inventory control, superior condition of goods upon arrival or lower shipping costs. Increasingly, the decision to ship by air is a market oriented decision and hence, a consumer oriented decision.
AIR FREIGHT FORWARDER: Serves a dual role. The air freight forwarders are, to the shipper, an indirect carrier because they receive freight from shippers under their own tariff usually consolidating it into larger units which is tendered to the airlines. To the airlines, the air freight forwarder is a shipper. An air freight forwarder is ordinarily classed as an indirect air carrier. However, several air freight forwarders operate their own aircraft.
AIR PARCEL POST- Term commonly used for priority mail which consists of first class mail weighing more than 13 ounces. Priority mail is another economical and expedited service for the shipping of parcels by air.
air taxi: An exempt for-hire air carrier that will fly anywhere on demand. Air taxis are restricted to a maximum payload and passenger capacity per plane.
AIR TRANSPORT ASSOCIATION OF AMERICA (ATA): The trade and service organization for the U.S. Scheduled airlines. The ATA acts on behalf of the airlines to serve the Government and the public in activities ranging from improvement in air safety to planning for the airlines' role in national defense. The ATA plays a leading role in encouraging Government to cut red tape that hampers foreign trade. In the cargo field, the ATA works with the airlines, the Government and shippers in developing improved standards and techniques in all phases of air cargo. The ATA is an authoritative source of information on cargo matters ranging from air freight packaging practices, automation, freight lift capacity, data on air freight growth and statistical data on air cargo services. For information: 1709 New York Avenue NW, Washington, DC 20006-5206.
Air Transport Action Group (ATAG): An independent coalition of organizations from throughout the air transport industry which have united to press for economically beneficial aviation capacity improvements in an environmentally responsible manner.
Air Transport Association (ATA): Founded by a group of 14 airlines meeting in Chicago in 1936, it was the first, and today remains the only trade organization for the principal U.S. airlines.
AIR TRANSPORT COMMITTEE: A Canadian government agency responsible for the economic and general welfare of air transport within Canada. For information: 15 Eddy Street, Ottawa, Ontario, Canada KIA 0N9.
AIR WAYBILL (AIRBILL): Shipping document used by the airlines for air freight. It is a contract for carriage that includes carrier conditions of carriage including such items as limits of liability and claims procedures. The air waybill also contains shipping instructions to airline, a description of the commodity, and applicable transportation charges. Air waybills can be used by many truckers as through documents for coordinated air-truck service. Air waybills are not negotiable. The airline industry has adopted a standard formatted air waybill that accommodates both domestic and international traffic. The standard document was designed to enhance the application of modern computerized systems to air freight processing for both the carrier and the shipper. Normally, an Air Waybill refers to the Air Waybill issued by carrying airlines and also called Master Air Waybill (MAWB) which comes with three digits of numeric airline identification codes issued by IATA to non-U.S. based airlines and Air Transport Association of America to U.S. based airlines. However, air freight forwarders also issue HAWB (House Air Waybill) to their customers for each of the shipments.
AIRBILL: See AIR WAYBILL.
Aircraft Container: A unit load device (ULD) which links directly with the airplane cargo handling and restraint system.
AIRCRAFT PALLET: The use of a platform or pallet (in air freight usually from ¾ “ to 2” thick) upon which unitized shipment rests or on which goods are assembled and secured before being loaded as a unit onto the aircraft. Most carriers offer container discounts for palletized loads. Palletization results in more efficient use of space aboard freighter aircraft and better cargo handling, particularly when used as part of mechanized systems employing such other advances as pallet loaders and pallet transporters. See also PALLET.
Airline Group of the International Federation of Operational Research Societies: A society with the avowed purpose of forwarding the practice of Operational Research in airlines. The membership consists of Operational Research workers who are also employed by recognized civil airlines.
Airfreightment: An agreement by a steamship line to provide cargo space on a vessel at a specified time and for a specified price to accommodate an exporter or importer, who then becomes liable for payment even though he is later unable to make the shipment.
AIRLINE TARIFF PUBLISHING COMPANY (ATPCO): Publisher of airline industry tariffs setting forth rates and rules applicable to air freight as well as fares for passengers. Tariffs are available on a subscription basis. Subscriptions include an up-to-date copy of the tariffs for new subscribers. For information: 400 West Service Road, Chantilly, VA 22021.
AIRMAIL: The term "airmail," as a class of mail, is used only in international postal service. Within the United States, the U.S. Postal Service moves all first class mail, priority mail, and express mail by air where this will expedite delivery.
Airlines Reporting Corporation (ARC): Since 1964, ARC's Area Settlement Plan (ASP) provides ARC accredited travel agency locations in the USA with a ticketing, reporting, and settlement link to ARC's participation carriers. Incorporated in 1984 and currently operating under the theme of Building an Electronic System, ARC provides its services to approximately 46,000 agency locations (of which 33,000 are retail locations) and 136 air and rail carriers.
Airport and Airway Trust Fund: A federal fund that collects passenger ticket taxes and disperses those funds for airport facilities.
Airports Council International (ACI): The Airports Council International is the "Voice of the World's Airports" representing over 1,200 airports across 150 countries.
AIRPORT MAIL FACILITY (AMF): A U S Postal Service facility located on or adjacent to an airport that is primarily engaged in the dispatch, receipt and transfer of mail directly with air carriers
AIRWORTHINESS CERTIFICATION: Documentation to show that aircraft or components comply with all the airworthiness requirements related to its use as laid down by the regulatory authorities for the country in which the aircraft is registered.
AIS: See ALBION INTERNATIONAL SERVICES, INC. Also abbreviation for “Automated Information System”.
AIT: See American Institute in Taiwan
AKTB: See AB.
AKTS: See AS.
ALL-COMMODITY RATE: 1) Usually a carload/truckload rate applicable to multiple shipments which move at one time in one vehicle from the consignor to the consignee. 2) “freight-all-kinds” or FAK rate. 3) An all-commodity rate is established based on actual transportation cost rather than “Value of service”.
ALL-CARGO AIRCRAFT: An aircraft for the carriage of cargo only rather than the combination of passengers and cargo. The all-cargo aircraft will carry traffic in bulk or container in the main deck as well as in the lower deck of the aircraft. It may include a scheduled and non-scheduled service.
All-Risk Clause: An insurance provision that all loss or damage to goods is insured except that of inherent vice (self caused). See All-Risk Insurance.
All Risks Coverage: A type of marine insurance, is the broadest kind of standard coverage, but excludes damage caused by war, strikes, and riots. The broadest form of coverage available, providing protection against all risks of physical loss or damage from any external cause. Does not cover loss or damage due to delay, inherent vice, pre-shipment condition, inadequate packaging, or loss of market.
ALL-RISK INSURANCE: Names given to a policy which covers against loss caused by all perils except those which are specifically excluded in the terms of the policy. This is the broadest form of coverage available, providing protection against all risks of physical loss or damage from any external cause. Does not cover loss or damage due to delay, inherent vice, pre-shipment condition, inadequate packaging, or loss of market. Ordinary policies name the peril or perils specifically covered in the policy.
ALLONGE: A slip of paper attached to a BILL OF LADING, ACCEPTANCE or NOTE for the purposes of providing space for additional endorsements.
ALLOWANCE: Deduction from the weight or value of goods, allowed if a carrier fails to provide necessary equipment and that equipment is furnished by the shipper.
ALONGSIDE: Point of delivery beside a vessel. Statement designating where the title to goods passes from party to another. Normally, a phrase referring to the side of a ship. Goods to be delivered "alongside" are to be placed on the dock or barge within reach of the transport ship's tackle so that they can be loaded aboard the ship. Also, goods delivered to the port of embarkation, but without loading fees.
AMTD: Abbreviation for “Automatic Magnetic Tape Distribution”
ALTERNATE ROUTING: Routing that is less desirable than the normal but results in identical terms.
AMERICAN BUREAU OF SHIPPING (ABS): Organization for classification of vessels, control of construction specifications and examination of seaworthiness.
American Institute in Taiwan: The AIT is a non-profit corporation that represents U.S. commercial, cultural, and other interests in Taiwan in lieu of an embassy. In 1979, the United States terminated formal diplomatic relations with Taiwan when it recognized the People's Republic of China as the sole legal government of China. AIT was authorized to continue commercial, cultural and other relations between the United States and Taiwan. AIT headquarters are located in Arlington, Virginia; constituent offices are in Taipei and Kaohsiung, Taiwan.
AMERICAN SOCIETY OF TRAFFIC & TRANSPORTATION (AST&T): Examining and certifying organization which aims for professionalism in the traffic and transportation field.
American Society of Transportation & Logistics: A professional organization in the field of logistics.
AMERICAN TRUCKING ASSOCIATION (ATA): National federation of the US trucking industry comprised of 51 state trucking associations (including Washington DC) and independent conferences, each representing a special class/type of trucking operation.
AMERICAN WAREHOUSEMEN’S ASSOCIATION (AWA): Voluntary organization of warehousemen established to assure high standards in the industry.
AMERICAN WATERWAY OPERATORS: A domestic water-carrier industry association representing barge operators on the inland waterways.
AMF: See AIRPORT MAIL FACILITY.
AMR: See ALBION MANAGEMENT RESOURCES, INC.
AMS: See Automated Manifest System
AMTRAK: The National Railroad Passenger Corporation. A federally created corporation that operates most of the US inter-city passenger rail service.
ANCILLARY EQUIPMENT: Equipment used to build up a palletized load or to convey an ULD outside an aircraft. See also AIRCRAFT PALLET.
ANIMAL CONTAINERS: The use of air freight as a means of transporting household pets led to the development of special containers designed to provide adequate protection and air circulation. Such containers may be purchased or rented from many carriers.
ANSI: Abbreviation for “American National Standards Institute”
Antidumping: Antidumping, as a reference to the system of laws to remedy dumping, is defined as a converse of dumping.
Antidumping Duty: A duty assessed on imported merchandise which is subject to an antidumping duty order. The antidumping duty is assessed on an entry-by-entry basis in an amount equal to the difference between the United States price of that entry and the foreign market value of such or similar merchandise at the time the merchandise was sold to the United States.
Antidumping Petition: A petition filed on behalf of an affected United States industry, alleging that foreign merchandise is being sold in the United States at "less than fair value" and that such sales are causing or threatening material injury to, or materially retarding the establishment of, a United States industry.
any-quantity rate: A rate that applies to any size shipment tendered to a carrier. No discount rate is available for large shipments.
APEC: See Asia Pacific Economic
APPARENT GOOD ORDER: Statement denoting that goods are free from damage and in good condition, as far as their external appearance is concerned.
AQMS: see Albion Quality Management Systems, Inc.
Arab Air Carriers Organization (AACO): The Arab Air Carriers Organization is the Regional Association of Arab Airlines. It is one of the oldest tools of Pan Arab cooperation established by the Arab League of States. Since its inception in 1965, AACO has thrived to progress in an environment of an air transport industry that is both challenging and demanding.
ARBITRARY: 1) Charge in addition to regular freight charge to compensate for unusual local conditions. 2) Fixed amount accepted by a carrier when dividing joint rates. Also referred to as a PROPORTIONAL, ADD-ON or construction rate.
ARBITRAGE: The buying of foreign exchange, securities or commodities in one market and the simultaneous selling in another market, in terms of a third market. By this manipulation, a profit is made due to the difference in rates of exchange or in the price of the securities or commodities involved.
Arbitration Clause: A standard clause to be included in the contracts of exporters and importers, as suggested by the American Arbitration Association. It states that any controversy or claim will be settled by arbitration in accordance with the rules of the American Arbitration Association.
ARC: See Airlines Reporting Corporation.
ARINC: Based in Annapolis, MD, this organization provides communications services, systems development and integration, systems engineering, and management services to the world's aviation community, commercial customers, and government agencies such as the FAA, DOD, NASA, DOE, and DOT. ARINC provides sophisticated communications and information handling services capable of reaching aircraft anywhere in the world.
ARRIVAL NOTICE: On arrival of freight at destination, notice is promptly sent to the consignee showing number of packages, description of goods, route, rate, weight, car initial and number, amount of freight charges, location where delivery will be made and the time allowed for removal before demurrage/storage charges will accrue. Also the Notice that the carrier or the forwarders sends to the consignee when a shipment has arrived. It is issued by railroads, airlines, and maritime services.
ARTICLES OF EXTRAORDINARY VALUE (AEV): Commodities identified as high value items.
artificial intelligence: A field of research seeking to understand and computerize the human thought process.
AS: The abbreviation for Akieselskabet, a joint stock company in Denmark or Norway. Also AKTS.
AS CUSTOMARY: In a contract, this refers to the usual manner of performing a service without a time period specified.
AS/IS: Term indicating that goods offered are without warranty or guarantee. Buyer has no recourse on vendor for the quality of the merchandise.
ASEAN: See Association of Southeast Asian Nations
Asia Pacific Economic Cooperation: APEC, established in November 1989, is an informal grouping of Asia Pacific countries that provides a forum for Ministerial level discussion of a broad range of economic issues. APEC includes the six ASEAN countries (Brunei, Indonesia, Malaysia, Philippines, Singapore, and Thailand), plus: Australia, Canada, China, Hong Kong, Japan, New Zealand, South Korea, Taiwan, and the United States.
Asian Development Bank: The ADB helps finance economic development in developing countries in the Asian and Pacific area through the provision of loans on near-market terms, with its Ordinary Capital Resources (OCR), and on concessional terms, through the Asian Development Fund (ADF). The ADB was established in 1965 (began operating in December 1966); headquarters are in Manila, Philippines.
ASIAN DOLLARS: U.S. funds deposited in banks in Asia and the Pacific Basin.
ASRS: See automated storage and retrieval system.
Assessment: The imposition of Antidumping Duties on imported merchandise.
Association of Asia Pacific Airlines (formerly the Orient Airlines Association): This organization covers all aspects of commercial aviation in the Asia Pacific region.
ASSEMBLY SERVICE: A service under which a carrier assembles shipments from many shippers and transports them as one shipment to one receiver. See also DISTRIBUTION SERVICE.
Asset-based provider: A logistics company with ties to a motor carrier, air carrier, railroad, or warehouse management firm.
ASSIGNMENT: Legal transfer of the rights, duties, responsibilities and/or benefits of an agreement, contract, or financial instrument to third party.
Assignment of Proceeds: A stipulation within a Letter of Credit in which some or all of the proceeds are assigned from the original beneficiary to one or more additional beneficiaries.
ASSOCIATION OF AMERICAN RAILROADS (AAR): A railroad industry association that represents the larger U. S. Railroads.
Association of Southeast Asian Nations (ASEAN): Agreed in January 1992 to create a free trade area (ASEAN Free Trade Area, or AFTA) with use of a common effective preferential tariff. Under the agreement ASEAN members will cut tariff rates within 15 years of its start date of January 1994. Manufactured goods from 15 sectors designated as "fast track" are subject to tariff reduction to 0-5 percent within 10 years, and seven years if the starting rates were already below 20 percent. "Fast track" sectors include vegetable oils, cement, chemicals, pharmaceuticals, fertilizer, plastics, rubber products, leather products, pulp, textiles, ceramic and glass products, gems and jewelry, copper cathodes, electronics, and wooden and rattan furniture.
AST&T: See AMERICAN SOCIETY OF TRAFFIC & TRANSPORTATION.
AT: Abbreviation for “American Terms” used in Marine Insurance. A term used to differentiate between the conditions of American Policies from those of other nations, principally England.
ATA: Actual Time of Arrival, or Airport-To-Airport or see AIR TRANSPORT ASSOCIATION OF AMERICA or AMERICAN TRUCKING ASSOCIATION.
ATA CARNET: A customs document permitting the holder to carry or send merchandise temporarily into certain foreign countries (for display, demonstration or similar purposes) without completing normal customs formalities. With a carnet, the holder avoids paying duties or posting bonds. See also CARNET.
ATAG: See Air Transport Action Group.
ATD: Actual Time of Departure.
ATLAS: See Automated Trade Locator Assistance Network
ATPCO: See AIRLINE TARIFF PUBLISHING COMPANY.
ATHWARTSHIP: A direction across the beam of a vessel.
ATTENDANT ACCOMPANYING SHIPMENTS: Sometimes attendants accompany cargo shipments as when grooms or veterinarians accompany racehorses or other live animals. This service requires advance arrangements with an airline.
AUDIT TRAIL: 1) Path generated by a fully processed business transaction includes original entry, transaction listing, file posting and report. 2) Management controls that document acceptance, handling and movement of materials through a warehouse. 3) Verifying summary account balances by analysis/inspection of underlying source documents and transaction records.
Auditing: In transportation, determining the correct transportation charges due the carrier. Auditing involves checking the freight bill for errors, correct rate and weight.
Automated Brokerage Interface (ABI): A system available to U.S. Customs Brokers with the computer capabilities and customs certification to transmit and exchange customs entries and other information, facilitating the prompt release of imported cargo. Part of Customs' Automated Commercial System, permits transmission of data pertaining to merchandise being imported into the United States. Qualified participants include brokers, importers, carriers, port authorities, and independent data processing companies referred to as service centers.
Automated Clearinghouse (ACH): The Automated Clearinghouse (ACH) is a feature of the Automated Broker Interface which is a part of Customs' Automated Commercial System. The ACH combines elements of bank lock box arrangements with electronic funds transfer services to replace cash or check for payment of estimated duties, taxes, and fees on imported merchandise.
Automated Commercial System: The electronic system of the US Customs Service, encompassing a variety of industry sectors, that permits on-line access to information in selected areas.
Automated Export Reporting Program: The AERP provides for electronic submission of most information required on the Shipper's Export Declaration. The program was initiated in 1969 with the intent of enabling large volume exporters to submit electronically and facilitate Census Bureau data entry and analysis. AERP was expanded in 1982 to allow freight forwarders, and again in 1985 to allow ocean carriers, to file electronically. At the beginning of fiscal year 1994, about 220 firms: - accounting for 350,000 to 400,000 records a month: - were participating in AERP. The program is administered by the Automated Data Reporting Branch, Foreign Trade Division, Bureau of the Census.
automated guided vehicle system: A computer-controlled materials handling system consisting of small vehicles (carts) that move along a guideway.
Automated Manifest System: The electronic system allowing a manifest inventory to be transmitted to the US Customs Service data center by carrier, port authority or service center computers.
automated storage and retrieval system: An automated, mechanized system for moving merchandise into storage locations and retrieving it when needed.
Automated Trade Locator Assistance Network: ATLAS is a Small Business Administration-sponsored, contractor-operated, automated system which provides market research information and statistics on world markets by SIC code (and possibly harmonized system). Indirect access is available for businesses, with arrangements through the local SBA district office. ATLAS, which became operational in Spring 1993, replaced SBA's export information system (XIS).
AUTOMATIC POD: Information automatically sent to payer containing name of person who signed for the package with date and time of delivery. See also POD.
AUTOMATIC PROOF OF DELIVERY: Same as AUTOMATIC POD.
AUTHORITY: Operating rights granted by a motor carrier by the ICC. See OPERATING AUTHORITY.
AUTHORITY TO PAY: A letter mainly used in the Far Eastern trade which is addresses by a bank to a seller of merchandise notifying him that it is authorized to purchase, with or without RECOURSE, drafts up to a stipulated amount drawn on a foreign buyer in cover of specialized shipments of merchandise.
AUTHORIZED CARRIER: Person/company authorized to engage in the transportation of property as a common carrier or contract carrier.
AVERAGE: Any loss or damage due to insured perils that is less than a total loss. Two types of average occur: Particular Average and General Average.
average cost: Total cost, fixed plus variable, divided by total output.
AWA: See AMERICAN WAREHOUSEMEN’S ASSOCIATION.
AXLE RATINGS: Rear axles on a truck generally carry three ratings; the carrying capacity rated at the ground (raw materials); the total weight the axle is capable of carrying/pulling in service, and the gross combined weight (GCW rating) which is the maximum horsepower limit the axle is capable of carrying in normal service (engine size rating).
BAA: Abbreviation for
the “British Airports Authority”
BACA: Abbreviation for the “Baltic Air Charter Association”.
back order: The process a company uses when a customer orders an item that is not in inventory, the company fills the order when the item becomes available.
BACK-TO-BACK CREDITS: A term commonly used to denote LETTERS OF CREDIT issued for account of different buyers to cover the same shipment, the terms of which credits are so similar that documents under one are subsequently applicable against one another.
BACKHAUL: 1) Return transportation movement, usually at less revenue than the original move (headhaul). 2) Movement in the direction of lighter traffic flow when traffic is generally heavier in the opposite direction. 3) To move a shipment back over part of a route already traveled.
BACKUP: Making a duplicate copy of a computer file or a program on a disk or cassette so that the material will not be lost if the original is destroyed. A spare copy.
BAI CERTIFICATE: Issued by the Bureau of Animal Industry of the USDA certifying veterinary inspection.
BAILEE RECEIPTS: See TRUST RECEIPT.
BALANCE OF TRADE: The difference between a country’s total imports and exports. If exports exceed imports, a favorable balance of trade exists; if not, a trade deficit is said to exist.
BALLAST: Heavy material which is placed in the ship’s hold for stability.
BANK ACCEPTANCE: A DRAFT of which a bank is drawee and acceptor.
BANK DRAFT: Bill of Exchange drawn by one bank to another. Normally used to provide a customer with funds payable at distant bank.
BANK RELEASE: Negotiable time draft drawn on and accepted by a bank which adds its credit to that of an importer of merchandise.
Banker's Acceptance: A banker's acceptance is a draft drawn on and accepted by a bank. Depending on the bank's creditworthiness, the acceptance becomes a financial instrument which can be discounted.
Banker's Draft: Draft payable on demand and drawn by or on behalf of the bank itself; it is regarded as cash and cannot be returned unpaid.
Banker's Guarantee: An assurance, obtained from a bank by a foreign purchaser; that the bank will pay an exporter up to a given amount for goods shipped if the foreign purchaser defaults.
bar code scanner: A device to read bar codes and communicate data to computer systems.
Bar codes: The most commonly used form of automatic-identification technology. Basically, a series of light and dark bars of different widths that are used to represent a number, letter or symbol. A bar-code reader, really an optical scanner, emits a beam of light and records the pulsated reflection that occurs when light bounces off the black-and-white bands. The scanner then converts the pulsated reflection of light into electronic data.
BARGE: The cargo carrying vehicle used primarily by inland water carriers. The basic barges have open tops, but there are covered barges for both dry and liquid cargoes.
BARREL: Container of cylindrical shape made of wood, aluminum or steel which is longer than it is wide and has ends with equal diameters.
Barter: The exchange of goods or services of equivalent value without the use of currency. Barter is the oldest form of trade. Widely used in trade with countries using currencies that are not readily convertible on the world exchange markets.
BASING POINT: Geographic point to which transportation rates are set to that rates to adjacent points can be constructed by adding or deducting from the Basing Point rate.
batch picking: The picking of items from storage for more than one order at a time.
BAUD RATE: Number of bits per second a computer is capable of sending/receiving. Varies from 300 (teletypewriter) and up.
BAY: Area in a warehouse outlined by markings on columns or posts or floor to show specific boundaries.
BEAM: Greatest width of a ship’s structure.
Belly Cargo: Freight accommodation below the main deck on an aircraft.
BENEFICIARY: The person in whose favor a DRAFT is drawn or a LETTER OF CREDIT opened. The beneficiary is usually the seller or exporter.
BELLY PITS OR HOLDS: Compartments located beneath the cabin of an aircraft and used for the carriage of cargo and passenger baggage.
Benchmarking: Using specific measurements to compare performance against another standard. A management tool for comparing performance against an organization that is widely regarded as outstanding in one or more areas, in order to improve performance.
BENEFIT-COST RATIO: An analytical tool used in public planning. A ratio of total measurable benefits divided by the initial capital cost.
Bermuda Agreement: An agreement concluded in 1946 between the U.K. and the U.S. designed to regulate future international air traffic. Most governments accept its principles and follow it inter-alia by limiting traffic rights on international routes to one or two carriers.
BERTH: Ship’s place at dock, pier, quay or wharf where a vessel can be loaded or discharged.
Berth Liner Service: Is a regular scheduled steamship line with regular published schedules (port of call ) from and to defined trade areas.
Berth or Liner Terms: An expression covering assessment of ocean freight rates generally implying that loading and discharging expenses will be for ship owner's account and usually apply from the end of ship's tackle in port of loading to the end of ship's tackle in port of discharge.
BERTH RATES: Rates charged by scheduled liner services.
Best practice: State-of-industry performance or application.
BIG EMERGING MARKETS: A group of fast growing economies identified by the Department of Commerce as having the most potential for U.S. exporters. They are currently: Argentina, Brazil, the China Economic Area (China, Hong Kong, Taiwan, India, Indonesia, Mexico, Poland, South Africa, South Korea and Turkey).
BILGE: 1) The lowest internal part of a ship’s hull, next to the keelson, where the bilge water collects. 2) Belly of a barrel or cask.
BILL OF EXCHANGE: Also referred to as a DRAFT. Instrument drawn by one person ordering second person to pay definite sum of money to third person on sight (SIGHT DRAFT) or at definite time in the future (TIME DRAFT).
BILL OF LADING: Principal transportation document by which a carrier acknowledges receipt of freight, describes the freight and sets forth a contract of carriage. It is a receipt for goods and contracts to move them. Terms and conditions, responsibilities and liabilities vary with manner and place of use. Bills of Lading may be negotiable or non-negotiable. Contents of the Bill of Lading were outlined in 1917. Every Bill of Lading must contain at least the following: 1) Date of issue. 2) Name of consignor. 3) Place of original consignment. 4) Place of delivery. 5) Statement of whether goods are to be delivered to a specific person. 6) Description of goods/packages containing them and 7) Signature of carrier. There are many kinds of Bills of Lading. An Ocean shipment requires two documents: an Inland Bill of Lading to cover the domestic movement of the cargo and an Ocean Bill of Lading to cover the international carriage. In air freight, the air waybill is a form of Bill of Lading and is the contract for carriage- both domestically and internationally. See also ORDER BILL OF LADING.
BILLING THIRD PARTY: The invoicing of transportation charges to other than shipper or consignee.
BINDER: 1) Temporary insurance coverage pending the issuance of an insurance policy or certificate. 2) A strip of cardboard, thin wood, burlap or similar material placed between layers of containers to hold a stack together.
BLANK ENDORSEMENT: Writing only one’s own name on the back of a document.
BLANKET RATE: A rate that does not increase according to the distance the commodity is shipped.
Bleeding edge: A maneuver so far ahead of its time that it may create a competitive disadvantage.
BLOCKED EXCHANGE: Exchange which cannot be freely converted into otter currencies.
Blue Lantern: Blue Lantern, a procedure pertaining to U.S. Munitions List items, is intended to verify that information stated on export license applications is valid and that the use of the commodity or service exported is consistent with the terms of the license. It includes pre-license and post-shipment checks of export applications conducted by designated officials at U.S. embassies. Blue Lantern was initiated in September 1990 by the State Department's Office of Defense Trade Controls
Bond System: The Bond System, a part of Customs' Automated Commercial System, provides information on bond coverage. A Customs bond is a contract between a principal, usually an importers, and a surety which is obtained to insure performance of an obligation imposed by law or regulation. The bond covers potential loss of duties, taxes, and penalties for specific types of transactions. Customs is the contract beneficiary.
BONDED TERMINAL: An airline terminal approved by the U.S. Treasury Department for storage of goods until Customs duties are paid or the goods are otherwise released.
BONDED WAREHOUSE: A warehouse authorized by Customs authorities for storage of goods on which payment of duties is deferred until the goods are removed. Also U.S. Customs Bonded Warehouse.
BOGIE: 1) An assembly of two or more axles. 2) Removable set of rear axles and wheels used to support a van container.
BOLSTER: A device so fitted on a chassis or railcar so as to hold and secure the container.
BONA FIDE: Latin phrase meaning “in good faith”. Also used to mean “real” or “true”.
BOND: 1) Obligation made binding by payment of a fee, which is lost if the contract is violated. 2) A binding agreement.
BONDED TERMINAL: An airline terminal approved by the U.S. Treasury Department for storage of goods until Customs duties are paid or the goods are otherwise released
BOTTOM SIDE-RAILS: Structural members located on the longitudinal sides of the base of the container.
BOX: 1) Slang term for trailer or container for ocean carriers. 2) A slang term used for truck transmission.
BOXCAR: An enclosed railcar typically 40 to 50 feet long; used for packaged freight and some bulk commodities.
BPR: See “Business Process Reengineering”
BRACING: Securing a shipment inside a carrier’s vehicle to prevent damage.
BRANCH LINE: Railroad line providing train service to one or more stations beyond a junction with the main line or another branch in the line.
BREAK BULK: 1) To unload, sort and reload some/all of a vehicle in transit. 2) To reduce a large shipment of a single commodity to many shipments that are then dispersed to various buyers. 3) Disassembling of consolidated shipment for delivery or re-consignment of a shipment. 4) Loose cargo, such as cartons, stowed directly in the ship's hold as opposed to containerized or bulk cargo. Note: For consolidated air freight, it is moved under one MAWB and each consignment designated to specific consignee or recipient is under one HAWB. When freight forwarder receives the consolidated cargo from carrier, they will break the consolidation apart per HAWB then proceed customs clearance along with associated shipping and import documents. Such Break-Bulk is normally handled by airlines or their contracted ground handling agent.
BREAK-EVEN WEIGHT: The weight at which it is cheaper to charge the lower rate for the next higher weight-break times the minimum weight indicated, than to charge the higher rate for the actual weight of the shipment.
Breaking out the box: Solving conventional problems with unconventional thinking.
BRIDGE FORMULA: Formula used to determine the maximum gross weight that can be carried on any given arrangement of consecutive axles.
BROKER: 1) Agent who arranges interstate movement of goods by other carriers. 2) Arranger of exempt loads for owner-operators and/or carriers. 3) One who arranges the buying/selling of goods for a commission. 4) Person who leases owned equipment to a carrier. 5) Solicitor of insurance who places orders for coverage with companies designated by the insured or with companies of his choosing. 6) Person or company licensed by the U.S. Treasury Department to transact business with Customs on behalf of importers. 7) Middleman between Buyer and Seller.
BROKER (CUSTOMS): A person or company licensed by the U.S. Treasury Department to transact business with Customs on behalf of importers. See also CUSTOM BROKERS and CUSTOMHOUSE BROKER.
BROKERAGE: Fee or commission that is paid to a BROKER for services performed.
Brussels Tariff Nomenclature Number: The customs tariff number used by most European nations. The US uses a similar system known as the Harmonized Tariff Schedule.
BULK: A mass of a product, unpackaged.
bulk area: A storage area for large items which at a minimum are most efficiently handled by the pallet load.
BULK CARRIER: Vessel engaged in carriage of bulk commodities like petroleum, grain or ore, which are not packaged, bundled, bottled or otherwise packed.
BULK SHIPMENTS: Shipments which are not packaged, but are loaded directly into the vessel's holds. Examples of commodities that can be shipped in bulk are ores, coal, scrap, iron, grain, rice, vegetable oil, tallow, fuel oil, fertilizers, and similar commodities.
BULKHEAD: 1) Upright wall in trailer or rail car that separates a load. 2) Cargo restraining partition in a vehicle or vessel.
BULL RINGS: Cargo securing devices mounted in the floor of containers which provide for the lashing and securing of cargo.
BUNKER: Ship’s coal bin or oil storage place.
BUSINESS LOGISTICS: The physical movement of goods from supply points to final sale to customers, and the associated transfer and holding of such goods at various intermediate storage points, accomplished in such a manner as to contribute to the explicit goals of an organization. The process of planning, implementing and controlling the efficient, effective flow and storage of goods, services and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirements. Note that this definition includes inbound, outbound, internal and external movements.
Business process re-engineering: The fundamental thinking and radical redesign of business process to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service and speed.
BUYERS RIGHT TO ROUTE: When a seller does not pay for freight charges, the purchaser has the right to designate the route for shipment; seller is responsible for following the buyers instructions. Complete routing is permitted for rail shipments but only for the first carrier in motor shipments.
C/L: See CARLOAD.
C&F: See Cost And Freight.
CAA: Abbreviation of the “Civil Aviation Authority”. Government body responsible for regulating U.K. airlines.
CABOTAGE: Applies to traffic originating at a point in one country and destined to another point within the territory of the same country. Coastwise and inter-coastal navigation and trading. In the US, a federal law that requires coastal and inter-coastal traffic to be carried in U.S.-built and U.S.-registered ships. Also, where cargo is carried on what is essentially a domestic flight and therefore not subject to international agreements that fix set rates. Cabotage rates are negotiable between shipper and airline and apply on flights within a country and to its overseas territories.
CAD: See CASH AGAINST DOCUMENTS.
CAD/CAM: Abbreviation for “Computer Aided Design” and “Computer Aided Manufacturing”.
CAF –See currency adjustment factor
Cage: (1) A secure enclosed area for storing highly valuable items. (2) A pallet-sized platform with sides that can be secured to the tines of a forklift and in which a person may ride to inventory items stored well above the warehouse floor. 3) The transporting of goods by truck to or from a vessel, aircraft, or bonded warehouse, all under customs custody.
Caged: Before import customs formality has been completed cleared and released, cargo is remained at bonded warehouse under customs custody.
CAPACITY PLATE: Plate affixed to a forklift truck indicating the maximum weight which can be raised or moved by that equipment.
Capital: The resources, or money, available for investing in assets that produce output.
CAPSTAN: Mechanical device for moving/raising heavy weights used at docks in mooring vessels at rail terminals to move dead engines.
CAPTAIN’S PROTEST: Declaration by master of ship on arrival in port to accidents/damage to ship/cargo during the voyage designated to relieve ship owner of liability.
CARGO: 1) Freight transported. 2) Goods, merchandise or commodities of every description which may be carried aboard a vessel, in consideration of the freight charged; does not include provisions and stores for use on board. 3) Equivalent to the term “goods” meaning anything carried or to be carried in an aircraft or vessel other than mail or property carried under the terms of an international postal convention or baggage (including personal effects accompanying a passenger) or the property of the carrier; providing that unaccompanied baggage moving under an air waybill or Bill of Lading is cargo.
CARGO AIRCRAFT: See ALL-CARGO AIRCRAFT.
CARGO AGENT: An agent appointed by a carrier to solicit and process international freight for shipments. In air freight, cargo agents are paid commissions by the airline.
Cargo Agents Settlement System: See CASS.
Cargo Network Services Corp. (CNS): A subsidiary of the International Air Transport Association, was founded to serve the needs of the Air cargo industry in the United States. CNS provides services to promote productivity, profitability, credibility, cooperation and quality of service among air carriers and cargo agents. For information: 300 Garden City Plaza, Suite 312, Garden City, NY 11530
CARGO PLAN: Stowage plan of a vessel.
Cargo Receipt: A receipt of cargo for shipment by a consolidator (used in ocean freight). See also DOCK RECEIPT.
Cargo Selectivity System: The Cargo Selectivity System, a part of Customs' Automated Commercial System, specifies the type of examination (intensive or general) to be conducted for imported merchandise. The type of examination is based on database selectivity criteria such as assessments of risk by filer, consignee, tariff number, country of origin, and manufacturer/shipper. A first time consignee is always selected for an intensive examination. An alert is also generated in cargo selectivity the first time a consignee files an entry in a port with a particular tariff number, country of origin, or manufacturer/shipper.
Caribbean Common Market: CARICOM includes 13 English-speaking Caribbean nations: Antigua and Barbuda, the Bahamas, Barbados, Belize, Dominica, Grenada, Guyana, Jamaica, Montserrat, St. Kitts-Nevis, St. Lucia, St. Vincent/Grenadines, and Trinidad and Tobago). CARICOM was established in 1973; headquarters are in Georgetown, Guyana.
CARLOAD (C/L or CL): 1) Quantity of freight required to fill a rail-car. 2) Specified quantity necessary to qualify a shipment for a carload rate.
Carmack Amendment: An Interstate Commerce Act amendment that delineates the liability of common carriers and the Bill of Lading provisions.
Carnet: Customs documents permitting the holder to carry or send sample merchandise temporarily into certain foreign countries without paying duties or posting bonds. Foreign customs regulations vary widely; in some countries, duties and extensive customs procedures on sample products may be avoided by obtaining an ATA Carnet. The ATA Carnet is a standardized international customs document used to obtain duty-free temporary admission of certain goods into the countries that are signatories to the ATA Convention. Under the ATA Convention, commercial and professional travelers may take commercial samples; tools of the trade; advertising material; and cinematographic, audiovisual, medical, scientific, or other professional equipment into member countries temporarily without paying customs duties and taxes or posting a bond at the border of each country visited. The carnets are generally valid for 12 months. See also TEMPORARY Importation UNDER BOND.
Carousel: A rotating system of layers of bins and/or drawers that can store many small items using relatively little floor space.
CARRIAGE: That part of transportation service that is represented by actual movement of goods to a point of destination after having been loaded but before being unloaded.
CARRIAGE OF GOODS BY SEA ACT: 1936 U.S. Statute that governs the acts that a carrier is responsible for and defines the terms used in shipping. The act provides that the shipowner's liability will be limited to $500 per shipping package, and it stipulates a one-year time limit for filing suit against the carrier. This act automatically applies to international ocean movements but not to domestic ocean transits unless the carrier agrees to be bound by it.
Carriage Paid To: Carriage paid to (CPT) and carriage and insurance paid to (CIP) a named place of destination. Used in place of CFR and CIF, respectively for shipment by modes other than water.
CARRIER: Individual, partnership or corporation engaging in the business of transporting goods or passengers, in most cases, for a fee. Usually means Steamship Company, but can also refer to trucking company, airline, or railroad as transporter of cargo.
Carriers(s) Containers or Shipper(s) Containers: The term Carrier(s) Container(s) or Shipper(s) Container(s) means containers over which the carrier or the shipper has control either by ownership or by the acquisition thereof under lease or rental from container companies or container suppliers or from similar sources. Carriers are prohibited from purchasing, leasing or renting shipper owned containers.
CARRIER’S LIABILITY: Liability begins when goods are delivered at the proper place and ends when goods have been delivered to the consignee or when the carrier’s duty has been discharged according to the terms of the freight contract. A common carrier is liable for all shipment loss, damage, and delay with the exception of that caused by act of God, act of a public enemy, act of a public authority, act of the shipper, and the goods' inherent nature.
Carriage and Insurance Paid to (CPA) (...named place of destination): Seller pays freight and insurance for carriage of the goods to the named destination.
Carriage and Insurance Paid To (CIP) (...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 contracts for insurance and pays the insurance premium. The buyer should note that under the CIP term the seller is only required to obtain insurance on minimum coverage.
CARTAGE: 1) Charge for pickup or delivery of goods. 2) Act of moving goods (usually short distances).
CARTAGE AGENT: Ground service operator who provides pickup and delivery in areas not served directly by air carrier.
CARTEL: Group of industrial companies that agree to regulate output, divide markets and set prices at which to sell products. An illegal practice in the U.S. since it violates anti-trust laws. carton flow rack: A storage rack consisting of multiple lines of gravity flow conveyors.
CASE MARKS: Information shown on the outside of shipping cartons, including destination and contents. See also MARKS.
CASH AGAINST DOCUMENTS (CAD): Payment for goods in which a commission house or other intermediary transfers title documents to the buyer upon payment in cash. A term denoting that payment is made when the bill of lading is presented.
CASH BEFORE DELIVERY (CBD): Seller assumes no risk and extends no credit because he is paid before shipment.
CASH IN ADVANCE (CIA): Payment for goods in which the full price is paid in full before the shipment is made. This type of payment is only made for small shipments or when goods are made to order.
Cash On Delivery: COD means payment to be made upon the delivery of goods.
CASH WITH ORDER (CWO): Payment for goods in which a buyer pays when ordering and in which the transaction is binding on both parties.
CASHIER’S CHECK: Check drawn by a bank.
CASS: Abbreviation for “Cargo Agents Settlement System”. Administered by CNS. Simplifies air cargo reporting, billing and remittance procedures through a centralized settlement system. During 1995, CNS instituted a credit improvement program which not only investigates potential problems but also assists the parties in achieving creative and acceptable solutions.
Category management: Managing products with similar requirements and characteristics (e.g., temperature-or humidity-controlled) as a single systems or category throughout the supply chain.
CAVEAT EMPTOR: Latin term meaning “let the buyer beware”. Common law imposes on the buyer the duty of examining the purchase. There is no recourse against seller because of the defects.
CBD: See CASH BEFORE DELIVERY.
CCEF: Abbreviation of “Customs Centralized Examination Facility”.
CD-ROM: Abbreviation for “Compact Disk-Read Only Memory”
CELLULAR VESSEL: Ship constructed for transportation of containers stacked on top of each other in vertical guide shafts, no general freight carried.
centralized authority: The restriction of authority to make decisions to few managers.
Central American Common Market: A first effort to establish a Central American Common Market, CACM (Spanish: Mercado Common Centroamericano, MCCA) was attempted in 1960 under the auspices of the Organization of Central American States (OCAS). A restructuring was started in 1973. Members include Honduras, Guatemala, El Salvador, Nicaragua and Costa Rica. The common market will cover all products traded within the region by the end of 1992. A second step toward regional integration will be the establishment of a common external tariff. CACM is associated with the Central American Bank for Economic Integration; headquarters are in Guatemala City, Guatemala.
Central Europe Free Trade Association: CEFTA is a trade agreement among the "Visegrad" countries: - Poland, the Czech Republic, Slovakia, and Hungary: - that is somewhat parallel to the European Free Trade Association.
central processing unit: The physical part of the computer that does the actual computing.
Certificate of Analysis: A certificate required by some countries as proof of the quality and composition of food products or pharmaceuticals. The required analysis may be made by a private or government health agency. The certificate must be legalized by a foreign consul of the country concerned, as is the case with such similar certificates as the phytosanitary certificate.
CERTIFICATE OF INSPECTION: A document often acquired in connection with shipments of perishable goods in which certification is made as to the good condition of the merchandise immediately prior to shipment. Pre-shipment inspection is a requirement for importation of goods into many developing countries.
CERTIFICATE OF INSURANCE: Issued (usually on Form E or Form H) by an officer of an insurance company, to state agency or other party, stating the fact that the party named has insurance coverage in amounts/type. Not a binding agreement.
CERTIFICATE OF MANUFACTURE: A statement sometimes notarized by a producer, usually also the seller, or merchandiser that indicates the goods have been manufactured and are at the disposal of the buyer.
CERTIFICATE OF MANUFACTURER: Document used with letters of credit when drafts are paid/negotiated on presentation of a certificate stating the fact that the goods have been completed and are being held for shipment.
CERTIFICATE OF ORIGIN: A document required by U.S. Customs and certain other countries for tariff purposes certifying as to the country of origin of specified goods. Sometimes requires the signature of the consul of the country to which it is destined. A certificate may be required even though the commercial invoice contains the information.
CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY: The grant of operating authority that is given to common carriers. A carrier must prove that a public need exists and that the carrier is fit, willing, and able to provide the needed service. The certificate may specify the commodities to be hauled, the area to be served, and the routes to be used.
CERTIFICATE OF REGISTRY: Document issued by maritime authorities indicating legal restriction of a ship.
CERTIFICATED CARRIER: A for-hire carrier that is subject to economic regulation and that requires an operating certification to provide services.
CES: Abbreviation of “Customs Examination Station”.
CFD: See Continuous flow distribution
CFR: See Cost And Freight.
CFS: The term CFS at loading port means the location designated by carriers for the receiving of cargo to be packed into containers by the carrier. At discharge ports, the term CFS means the bonded location designated by carriers in the port area for unpacking and delivery of cargo.
CFS/CFS: The term CFS/CFS means cargo delivered by break-bulk to Carrier's CFS to be packed by Carrier into containers and to be unpacked by Carrier from the container at Carrier's destination port CFS.
CFS/CY: The term CFS/CY means cargo delivered break-bulk to Carrier's CFS to be packed by Carrier into containers and accepted by consignee at Carrier's CY and unpacked by the consignee off Carrier's premises, all at consignee's risk and expense.
CFS CHARGE: The term CFS Charge means the charge assessed for services performed at the loading or discharging port in packing or unpacking of cargo into/from containers at CFS.
CFS Receiving Service: The term "CFS Receiving Services" means the service performed at loading port in receiving and packing cargo into containers from CFS to CY or shipside. "CFS Receiving Services" referred herein are restricted to the following: Moving empty containers from CY to CFS, Drayage of loaded containers from CFS to CY and/or ship's tackle, Tallying, Issuing dock receipt/shipping order, Physical movement of cargo into, out of and within CFS, Stuffing, sealing and marking containers, Storage, Ordinary sorting and stacking, Preparing carrier's internal container load plan
Chaebol: Chaebol are Korean conglomerates which are characterized by strong family control, authoritarian management, and centralized decision making. Chaebol dominate the Korean economy, growing out of the takeover of the Japanese monopoly of the Korean economy following World War II. Korean government tax breaks and financial incentives emphasizing industrial reconstruction and exports provided continuing support to the growth of Chaebols during the 1970s and 1980s. In 1988, the output of the 30 largest chaebol represented almost 95% of Korea's gross national product.
CHARGES FOR PACKING SHIPMENTS: Some carriers provide material and services for packing and unpacking special commodities that require special packaging and handling. A charge is made for this service.
CHARGEABLE WEIGHT: The weight of the shipment used in determining air freight charges. The chargeable weight may be the dimensional weight or on container shipments the gross weight of the shipment less the tare weight of the container.
Chargeable Kilo: Rate for goods where volume exceeds six cubic meters to the tonne.
CHARGES ADVANCED: See ADVANCEMENT or CHARGES.
CHARGES COLLECT: Transportation charges may include pickup and/or delivery and are entered on the air waybill to be collected from the consignee. Equivalent terms are freight collect or charges forward.
CHARGES FORWARD: A banking term used when foreign and domestic bank commission charges, interest (if any) and government taxes in connection with the collection of a draft are for the account of the drawee.
CHARGES FOR PACKING SHIPMENTS: Some carriers provide material and services for packing and unpacking special commodities that require special packaging and handling. A charge is made for this service.
charging area: A warehouse area where a company maintains battery chargers and extra batteries to support a fleet of electrically powered materials handling equipment. The company must maintain this area in accordance with government safety regulations.
Charter: Originally meant a flight where a shipper contracted hire of an aircraft from an airline. Has usually come to mean any non-scheduled commercial service.
CHARTER PARTY: A contract, expressed in writing on a special form, between the owner of a vessel and the one (the Charterer) desiring to employ the vessel, setting forth the terms of the arrangement such as freight rates and ports involved in the trip contemplated. Also, among other specifications, the contract usually stipulates the exact obligations of the ship-owner (loading the goods, carrying the goods to a certain point, returning to the charterer with other goods, etc.); or it provides for an outright leasing of the vessel to the charterer, who then is responsible for his own loading and delivery. In either case, the charter party sets forth the exact conditions and requirements agreed upon by both sides.
Charter Party Bill of Lading: A bill of lading issued under a charter party. It is not acceptable by banks under letters of credit unless so authorized in the credit.
CHARTER SERVICE: The temporary hiring of an aircraft usually on a trip basis, for the movement of cargo or passengers.
CHASSIS: A trailer-type device with wheels constructed to accommodate containers enabling the load to be moved over-the-road. Also, a wheel assemble including bogies constructed to accept mounting of containers.
CHECK DIGIT NUMBER: A single digit of the air waybill number used to insure that the air waybill number is correctly entered into a computer system.
CHEMTREC: Abbreviation for “Chemical Transportation Emergency Center”. Organization available on a 24-hour basis to provide emergency response information to anyone involved in hazardous chemical accidents.
Chinese Economic Area: The CEA is an informal reference to the economic integration of Southern China with Hong Kong and Taiwan which has proceeded without any "arrangement". Also referred as "Greater China".
CHOCK: 1) A piece of wood or other material placed at the side of cargo to prevent it from rolling about or moving sideways. 2) A wedge, usually made of hard rubber or steel, that is firmly placed under the wheel of a trailer, truck, or boxcar to stop it from rolling.
CIA: See CASH IN ADVANCE.
CIF: See Cost, Insurance and Freight.
CITES: Abbreviation “Committee on International Trade of Endangered Species”
city driver: A motor carrier driver who drives a local route as opposed to a long-distance, inter-city route.
CITY TERMINAL SERVICE: A service provided by some air lines to accept shipments at the terminals of their cartage agents or other designated in-town terminals or to deliver shipments to these terminals at lower rates than those charged for the door-to-door pickup and delivery service.
CIVIL AERONAUTICS BOARD (CAB): A Federal agency created by Congress in 1938 to promote the development of the U.S. air transport system, to award air routes and to regulate passenger fares and cargo rates. Legislation passed by the U.S. Congress in 1978 terminated the CAB, effective January 1, 1985. Many of the CAB functions such as certificates, air carrier fitness, consumer protection, international rates and services were transferred to the Department of Transportation.
CL: See CARLOAD.
CLAIM: 1) Demand on transportation company for payment, due to loss/damage of freight that occurred during transit. 2) Demand on transportation company for refund on overcharge. 3) Demand by individual or corporation to recover for loss under policy of insurance.
CLASS (or KIND) of MERCHANDISE: A term used in defining the scope of an antidumping investigation. Included in the "class or kind" of merchandise is merchandise sold in the home market which is "such or similar" to the petitioned product. "Such or similar" merchandise is that merchandise which is identical to or like the petitioned product in physical characteristics.
Class I carrier: A classification of regulated carriers based upon annual operating revenues--motor carriers of property of more than $5 million; railroads more than $50 million and motor carriers of passengers more than $3 million.
Class II carrier: A classification of regulated carriers based upon annual operating revenues--motor carriers of property of $1-$5 million; railroads of $10-$50 million and motor carriers of passengers less than $3 million.
Class III carrier: A classification of regulated carriers based upon annual operating revenues--motor carriers of property of less than $1 million and railroads less than $10 million.
"Class or Kind" of Merchandise: A term used in defining the scope of an antidumping investigation. Included in the "class or kind" of merchandize is merchandise sold in the home market which is "such or similar" to the petitioned product. "Such or similar" merchandise is that merchandise which is identical to or like the petitioned product in physical characteristics.
CLASS RATE: Rate for commodities grouped according to similar shipping characteristics. Applies to numbered/lettered groups/classes of articles contained in the territorial rating column in classification schedules. A class rate is available for any product between any two points.
Classification: 1) An alphabetical listing of commodities, the class or rating into which the commodity is placed, and the minimum weight necessary for the rate discount. Used in the class rate structure. 2) A customs term. The placement of an item under the correct number in the customs tariff for duty purposes. At times this procedure becomes highly complicated; it is not uncommon for importers to resort to litigation over the correct duty to be assessed by the customs on a given item.
classification yard: A railroad terminal area where railcars are grouped together to form train units.
Claused Bill of Lading: A bill of lading which has exemptions to the receipt of merchandise in "apparent good order" noted.
CLAYTON ACT: An antitrust act of Congress making price discrimination unlawful. The Federal Trade Commission (FTC) is the enforcement agency.
Clean Bill of Lading: A bill of lading which covers goods received in "apparent good order and condition" and without qualification.
CLEAN DRAFT: A draft to which no documents are or have been attached.
CLEARANCE: 1) Customhouse certificate that ship is free to leave, all legal requirements having been met. 2) Space or measurements above an beside tracks/highways.
CLEAT: Strip of wood or metal used to add additional strength or to prevent warping or to keep goods in position.
CLM: See Council of Logistics Management
COASTAL CARRIERS: Vessels that provide service along coasts serving ports on the Atlantic or Pacific oceans or on the Gulf of Mexico.
COCOM: See: Coordinating Committee for Export Controls
COD TERMS OF SALE: Abbreviation for “Cash On Delivery”. Buyer pays carrier the price of goods before they are delivered. Seller assumes risk of buyer refusing to accept goods.
COFC: Abbreviation for “Container on Flatcar”.
COGAS: See CARRIAGE OF GOODS BY SEA ACT.
COLLAPSIBLE CONTAINER: So fitted that the main parts are hinged or removable for the purpose of reducing its effective volume for transporting in a empty condition, thus making more efficient use of empty space.
COLLECT CHARGES: The transportation practice under which the receiver of the goods pays charges. See CHARGES COLLECT.
COLLECT ON DELIVERY (COD): A transportation service under which the purchase price of the goods is collected by the carrier from the receiver at the time of delivery, and subsequently, payment is transmitted by the carrier to the shipper. Carriers charge a nominal fee for this service. As the term COD implies payment is due upon delivery. There are no credit provisions in COD service.
COLLECT SHIPMENT: Shipment where collection freight charges/advances is made by delivering carrier from the consignee/receiver.
Collection Papers: All documents (invoices, bills of lading or air waybill, etc.) submitted to a buyer for the purpose of receiving payment for a shipment.
Collection System: The Collections System, a part of Customs' Automated Commercial System, controls and accounts for the billions of dollars in payments collected by Customs each year and the millions in refunds processed each year. Daily statements are prepared for the automated brokers who select this service. The Collections System permits electronic payments of the related duties and taxes through the Automated Clearinghouse capability. Automated collections also meet the needs of the importing community through acceptance of electronic funds transfers for deferred tax bills and receipt of electronic payments from lock-box operations for Customs bills and fees.
Collective Paper: All documents (commercial invoices, bills of lading, etc.) submitted to a buyer for the purpose of receiving payment for a shipment.
COMBI AIRCRAFT: Aircraft specially designed to carry unitized cargo loads on the upper deck of the aircraft forward of the passenger compartment.
COMBINATION AIRCRAFT: An aircraft capable of transporting both passengers and cargo on the same flight. Some came is carried on virtually all scheduled passenger flights in the belly pits below the passenger cabin.
Combination Vessels: Container/Break-bulk vessel: this type of ship accommodates both container and break-bulk cargo. It can be either self sustaining or non-self sustaining.
COMMERCE: Buying, selling, trading and transportation of goods and services.
COMMERCE CLAUSE OF THE U.S. CONSTITUTION: .... “Congress shall have the power.... to regulate commerce with foreign nations and among the several states...”. This clause that gives authority to regulate interstate commerce.
Commercial Code: A published code designed to reduce the total number of words required in a cablegram.
COMMERCIAL INVOICE: Itemized list issued by seller/exporter in foreign trade showing quantity, quality, description of goods; price, terms of sale, marks/numbers, weight full name/address of buyer and date. The commercial invoice is a bill for the goods from the seller to the buyer. These invoices are often used by governments to determine the true value of goods for the assessment of customs duties and are also used to prepare consular documentation. Governments using the commercial invoice to control imports often specify its form, content, number of copies, language to be used, and other characteristics.
Commercial Risk: Risk carried by the exporter (unless insurance is secured) that the foreign buyer may not be able to pay for goods delivered on an open account basis. With respect to Eximbank guarantees, commercial risks cover nonpayment for reasons other than specified Political Risks. Examples are insolvency or protracted default.
COMMERCIAL SET: Set of four "negotiable" documents that represents and takes the place of the goods themselves in the financing of the cargo sales transaction.
Commercial Treaty: An agreement between two or more countries setting forth the conditions under which business between the countries may be transacted. May outline tariff privileges, terms on which property may be owned, the manner in which claims may be settled, etc.
commercial zone: The area surrounding a city or town to which rate carriers quote for the city or town also apply. The ICC defines the area.
COMMISSION: Fee charged by brokers as compensation for their services in purchasing or selling commodities/securities at the direction of a customer.
Committee for the Implementation of Textile Agreements: CITA is an interagency committee chaired by the Department of Commerce which exercises the rights of the United States under the Multi-Fiber Arrangement. CITA initiates "calls" for consultation when imports of a particular textile product from a particular country disrupt the U.S. domestic market for that product. Other member agencies include the Departments of Labor, State, and Treasury and the United States Trade Representative.
COMMITTEE OF AMERICAN STEAMSHIP LINES: An industry association representing subsidized U.S. flag steamship companies.
commodities clause: A clause that prohibits railroads from hauling commodities that they produced, mined, owned or had an interest in.
COMMODITY CODE: A system for identifying a given commodity by a number as a means of facilitating, for example, the application of computerization to freight transport. See HARMONIZED COMMODITY DESCRIPTION AND CODING SYSTEM.
COMMODITY RATE: A rate for a specific commodity and its origin or destination.
Commodity Specialist: An official authorized by the U.S. Treasury to determine proper tariff and value of imported goods.
COMMON CARRIER: Any carrier engaged in the interstate transportation of persons or property on a regular schedule at published rates and whose service are available to the general public on a for-hire basis. Common carriers are regulated by the ICC. To operate, the carrier must secure a certificate of public convenience and necessity.
COMMON CARRIER DUTIES: Common carriers are required to serve, deliver, charge reasonable rates and not discriminate.
COMMON COST: A cost that cannot be directly assignable to particular segments of the business that is incurred for the business as a whole.
Common Market: A common market (as opposed to a free trade area) has a common external tariff and may allow for labor mobility and common economic policies among the participating nations. The European Community is the most notable example of a common market.
Commuter: 1) An exempt for-hire air carrier that publishes a time schedule on specific routes. 2) A special type of air taxi.
comparative advantage: A principle based on the assumption that an area will specialize in producing goods for which it has the greatest advantage or the least comparative disadvantage.
Competitive line rate: A shipper/carrier negotiated rate or National Transportation Agency-imposed rate. With a Competitive Line Rate, Railway A (the "local carrier") may charge a shipper served exclusively by it and located more than 30 kilometers from an interchange, to move the shipper's traffic to the interchange and transfer it to Railway B (the "connecting carrier").
COMPUTERIZED TRAFFIC FLOW: The increased use of electronic data processing is one of the most significant advances in physical distribution of recent years. Computers are being given new assignments not only by carriers, but also by shippers, to achieve better control over the flow of raw materials and finished inventories. Also the U.S. Government and the United Nations gather more accurate data on the flow of commerce. Airlines have been in the forefront of computer application of cargo operations by using computers to prepare air waybills, expedited terminal handling, pickup and delivery, up-to-the-minute shipment status and billing.
CONCEALED DAMAGE: When product in an apparently undamaged container is damaged. Usually freight claims for concealed damage are difficult to settle because neither shipper nor carrier wants responsibility.
CONCURRENCE: Document signed by carrier and filed with the ICC that verifies carrier participates in rates published in a tariff by a given agent.
CONDITIONS OF CONTRACT: The terms and conditions established by the air carriers for the carriage of goods. These conditions are printed on the air waybill and include such items as limits of liability, claims limitations, indemnity and dimensional weight rules.
CONFERENCE: 1) Independent/autonomous organization within the American Trucking Association (ATA) that represents a certain class/type of motor carrier. 2) Association of shipowners servicing the same trade route who operate under collective conditions of carriage and tariff rates. Organization which fixes rates and sailings for the purpose of limiting competition between members and of “outsiders.
Conference on Security and Cooperation in Europe: CSCE was established in 1991 as a successor to the Eastern bloc's Council for Mutual Economic Assistance (CMEA or COMECON). CSCE administers residual tariffs and quotas and relations with other organizations.
Confidential contract: A binding written agreement for the rates and conditions of moving traffic, negotiated between a shipper and railway and kept confidential between them. Such contracts were not permitted before the 198 National Transportation Act.
Confirmed Letter of Credit: A letter of credit, issued by a foreign bank, with validity confirmed by a U.S. bank. An exporter who requires a confirmed letter of credit from the buyer is assured of payment by the U.S. bank even if the foreign buyer or the foreign bank defaults.
Confirming: Confirming is a financial service in which an independent company confirms an export order in the seller's country and makes payment for the goods in the currency of that country. Among the items eligible for confirmation are the goods; inland, air, and ocean transportation costs; forwarding fees; custom brokerage fees; and duties. Confirming permits the entire export transaction from plant to end user to be fully coordinated and paid for over time. It is mainly a European practice.
Confiscation: The taking and holding of private property by a government or an agency acting for a government. Compensation may or may not be given to the owner of the property.
Conrail: Abbreviation for the “Consolidated Rail Corporation” established by the Regional Reorganization Act of 1973 to operate the bankrupt Penn Central Railroad and other bankrupt railroads in the Northeast. The 4-R Act of 1976 provided funding.
CONSIGN: 1) Deliver formally to another. 2) Send goods to buyer, factor or agent to sell.
CONSIGNEE: Person who receives the goods shipped from one owner (consignor) or a person named as the receiver of a shipment: one to whom a shipment is consigned. Also, the person or firm named in a freight contract to whom goods have been consigned or turned over. For export control purposes, the documentation differentiates between an "intermediate" consignee and an "ultimate" consignee.
CONSIGNEE ACCOUNT NUMBER: See ACCOUNT NUMBER.
Consignee Marks: A symbol laced on packages for identification purposes; generally consisting of a triangle, square, circle, diamond, cross, with letters and/or numbers as well as port of discharge.
CONSIGNMENT: Shipment of one or more pieces of property, accepted by the carrier from one shipper at one time, receipted for in one lot and moving on one air waybill. Also merchandise shipped to a foreign agent or customer when an actual purchase has not been made, but under an agreement obliging the consignee to pay the consignor for the goods when sold. Also, the delivery of merchandise from an exporter (the consignor) to an agent (the consignee) under agreement that the agent sell the merchandise for the account of the exporter. The consignor retains title to the goods until sold. The consignee sells the goods for commission and remits the net proceeds to the consignor.
CONSIGNOR: Shipper of goods. Means the person whose name appears as the party contracting with the carrier for the carriage of goods. See also SHIPPER.
CONSOLIDATION –1) Practice of combining less-than-carload (LCL) or less-than-truckload (LTL) shipments to make carload/truckload movements. 2) The Consolidation Endorsement may be added to an Open Cargo Policy at an agreed premium, to provide coverage on merchandise while in transit to, and while at, a common consolidation point for the purpose of preparing or consolidating the merchandise for export. Also, in order to handle small lot of consignment efficiently and competitively, freight forwarder usually put many consignments into one lot then tender to carrier for forwarding. In this case, each consignment will be shipped with one HAWB respectively and all of them will be under one MAWB.
CONSOLIDATOR: An entity that provides service also provided by an air carrier, independent from that carrier, and derives income from package consolidation of others for tender to an air carrier. An Air Freight Forwarder performs the functions of a consolidator.
Consortium: The name for an agreement under which several nations or nationals (usually corporations) of more than one nation, join together for a common purpose. It could be for management or exploitation of a natural resource, as in the case of some international petroleum consortiums.
Constructed Value: A means of determining fair or foreign market value when sales of such or similar merchandise do not exist or, for various reasons, cannot be used for comparison purposes. The "constructed value" consists of the cost of materials and fabrication or other processing employed in producing the merchandise, general expenses of not less than 10 percent of material and fabrication costs, and profit of not less than 8 percent of the sum of the production costs and general expenses. To this amount is added the cost of packing for exportation to the United States.
construction rate: See ARBITRARY.
Consul: A government official residing in a foreign country, charged with representing the interests of his or her country and its nationals.
CONSULAR DECLARATION: A formal statement made to the consul of a foreign country describing goods to be shipped.
CONSULAR DOCUMENTS: Bills of Lading, Certificates of Origin or special forms of invoice to which has been added the official signature of the consul of the country of destination.
Consular Invoice: A document, required by some foreign countries, describing a shipment of goods and showing information such as the consignor, consignee, and value of the shipment. Certified by a consular official of the foreign country, it is used by the country's customs officials to verify the value, quantity, and nature of the shipment.
CONSULAR VISA: An official signature affixed to certain shipping documents by the consul of the country of destination.
Consultative Committee for International Telephone and Telegraphy: CCITT facilitates U.S. coordination of communications standards issues. CCITT is a part of the International Telecommunications Union (ITU), which is an international treaty organization. The State Department is responsible for coordinating and presenting U.S. positions to the ITU.
container: The term container means a single rigid, non-disposable dry cargo, insulated, temperature controlled flatrack, vehicle rack portable liquid tank, or open top container without wheels or bogies attached, having not less than 350 cubic feet capacity, having a closure or permanently hinged door that allows ready access to the cargo (closure or permanently hinged door not applicable to flatrack vehicle rack or portable liquid tank). All types of containers will have constructions, fittings and fastenings able to withstand without permanent distortion, all the stresses that may be applied in normal service use of continuous transportation. All containers must bear manufacturer's specifications. For Air Cargo, many types of air cargo containers are offered: The containers are designed in various sizes and irregular shapes to conform to the inside dimensions of a specific aircraft. For ocean cargo, containers are designed to be moved inland on its own chassis and can be loaded at the shippers plant for shipment overseas. Basic types of containers are; dry van, open top, half high, hi cube, flat rock, tank container, refrigerated container, insulated container, tilting container. Average outside dimensions are generally 20, 35, and 40 feet in length, 8 feet wide and 8 feet high standard.
CONTAINER FREIGHT STATION See CFS: Associated with consolidation depots where parcels of cargo are grouped and loaded into containers.
CONTAINER LOAD: A loading which does not utilize the full volumetric capacity of a container nor the maximum payload by weight and will permit additional part loads.
CONTAINER ON FLAT CAR (COFC): Is the form of piggyback where the van-container is first de-mounted from the chassis or bogie, prior to being loaded and secured directly onto a railroad flat car.
CONTAINER POOL: An agreement between transport carriers and/or container leasing companies which will permit the exchange of containers.
CONTAINER SHIP: Vessel with specially designed cellular structure for transport of containers.
CONTAINERIZATION: 1) The practice or technique of using a box-like device in which a number of packages are stored, protected, and handled as a single unit in transit. Container descriptions have been broadened to include a unitized load on a carrier owned pallet, loaded by shippers, and unloaded by receivers at places other than on airline premises and are restrained and contoured so as to permit proper positioning and tie-down aboard the aircraft. Containerized air freight reduces packaging costs for the shipper because of the protection afforded by the container. The buildup of container loads at the shipper's plant bypasses the terminals. Shippers who do not have appropriate facilities for loading and unloading containers may contract through the airlines for this service. Specially equipped trucks pick up containerized shipments at the shipper's plant for direct delivery to mechanical loading equipment near plane-side. Containerization saves the airlines time and manpower in ground handling and enables the carriers to achieve a more efficient utilization of the cubic capacity of modern freighter aircraft and wide body jets Consequently, the airlines pass along part of this savings to shippers. 2) Shipping system based on large cargo-carrying (usually 20 or 40 feet in length) that can be interchanged between trucks, trains and ships without re-handling contents.
contingency planning: Preparing to deal with calamities (e.g., floods) and non-calamitous situations (e.g., strikes) before they occur.
Continuous Bond: An annual customs bond insuring compliance with all regulations and requirements.
Continuous flow distribution: The streamlined pull of products in response to customer requirements while minimizing the total costs of distribution.
continuous-flow, fixed-path equipment: Materials handling devices that include conveyors and drag lines.
Continuous Replenishment Program: A customer-driven replenishment when the purchase of a good by the end user triggers the manufacturing and movement of a product through the supply chain. A system used to reduce customer inventories and improve service usually to large customers.
CONTRABAND: During the time of war, materials carried aboard a vessel that could aid a belligerent in the process of the war, such as arms, weapons or munitions.
CONTRACT CARRIER: Carrier engaged in interstate transportation of persons/property by motor vehicles on a for-hire basis but under continuing contract with one or a limited number of customers to meet specific needs of each customer. Must receive authorization from the ICC.
Contract Logistics: The use of a third-party provider to plan, implement and control the efficient, cost-effective flow and storage of raw materials, in-process inventory, finished goods and related information from the point of origin to the point of consumption, or any portion thereof.
Conveyor: A materials handling device that moves freight from one warehouse area to another. Roller conveyors utilize gravity, whereas belt conveyors use motors.
COOPERATIVE ASSOCIATIONS: Groups of companies or individuals having common interest; agricultural cooperative associations may haul up to 25% of their total interstate tonnage in non-farm, non-member goods in movements incidental and necessary to their primary business.
COORDINATED TRANSPORTATION: Two or more carriers of different modes transporting a shipment.
COORDINATED MOVEMENT: The extending of the air freight transport system to the immediate and smaller size communities increasingly involves the use of interline agreements and the use of combined services of truck/air, helicopters, regional, and commuter airlines. In many cases such traffic moves under a joint rate. The success of such combined service hinges on preplanning on the part of the carriers, and often on the part of shippers, with regard to production and distribution schedules. The various aspects of such preplanning among two or more carriers and shippers are often referred to as "coordinated movement."
Coordinating Committee for Export Controls: An informal group of 15 western countries established to prevent the export of certain strategic products to potentially hostile nations.
Coordination Council for North American Affairs: The CCNAA, the counterpart to the American Institute in Taiwan, unofficially represents Taiwan's interests in the United States. The Council provides information on trade, business, and investment opportunities to the American business community. Council headquarters are in Washington, D.C.
CO-LOAD: Two shipments from different terminals combined to ship as one load.
CORDAGE: Products of rope, twine and string industry.
Core competency: A function essential to a company's success.
Correspondent Bank: A bank that, in its own country, handles the business of a foreign bank.
Cost And Freight (CFR) (...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. The CFR term requires the seller to clear the goods for export. This term can only be used for sea and inland waterway transport. When the ship's rail serves no practical purpose, such as in the case of roll-on/roll-off or container traffic, the CPT term is more appropriate to use. (Typically used for ocean shipments only. CPT, or carriage paid to, is a term used for shipment by modes other than water.) Also, a method of import valuation that includes insurance and freight charges with the merchandise values.
Cost, Insurance and Freight (CIF) (...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 contracts for insurance and pays the insurance premium. The buyer should note that under the CIF term the seller is only required to obtain insurance on minimum coverage. The CIF term requires the seller to clear the goods for export.
cost of lost sales: The forgone profit companies associate with a stock-out.
Costs of Manufacture: In the context of dumping investigations, the costs of manufacture, COM, is equal to the sum of the materials, labor and both direct and indirect factory overhead expenses required to produce the merchandise under investigation.
Cost of Production: A term used to refer to the sum of the cost of materials, fabrication and/or other processing employed in producing the merchandise sold in a home market or to a third country together with appropriate allocations of general administrative and selling expenses. COP is based on the producer's actual experience and does not include any mandatory minimum general expense or profit as in "constructed value."
cost trade-off: The interrelationship among system variables in which a change in one variable affects other variables' costs. A cost reduction in one variable may increase costs for other variables, and vice versa.
Country of Origin: The U.S. Customs Service defines country of origin as the country where an article was wholly grown, manufactured or produced, or, if not wholly grown, cultivated or produced in one country, the last country in which the article underwent a substantial transformation. Duty rates vary according to the country of origin.
Court of International Trade: The CIT has jurisdiction over any civil action against the United States arising from Federal laws governing import transactions. The court hears antidumping, product classification, and countervailing duty matters as well as appeals of unfair trade practice cases from the International Trade Commission. The court was originally established in 1890; principal offices are located in New York City, but the court is empowered to hear and determine cases arising at any port or place within the jurisdiction of the United States. The judges are appointed for life by the President, subject to Senate confirmation.
Council of Logistics Management: A professional organization in the logistics field that provides leadership in understanding the logistics process, awareness of career opportunities in logistics and research that enhances customer value and supply chain performance.
Counterpurchase: This is an agreement whereby the initial exporter buys or undertakes to find a buyer for a specified amount or value of unrelated goods from the initial importer during a specified time period.
Countertrade: Refers to the reciprocal and compensatory trade agreements involving the purchase of goods or services by the seller from the buyer of his product, or arraignments whereby the seller assists the buyer in reducing the amount of net cost of the purchase through some form of compensatory financing. See also Technology Transfer.
COUNTERVAILING DUTY: A duty over and above normal duties, imposed by the Secretary of the Treasury to counteract the economic advantage afforded the foreign supplier (from export grants, bounties or subsidies paid in certain countries by their government for export promotion).
COUNTRY OF EXPORTATION (COE): Is usually, but not necessarily, the country in which merchandise was manufactured or produced and from which it was first exported. For example, merchandise made in Switzerland and shipped to the United States through Frankfurt, Germany has, as the country of exportation, Switzerland.
COUNTRY of ORIGIN: Country of origin is the country where the merchandise was grown, mined or manufactured, in accordance with U.S. Customs Regulations. In instances where the Country of Origin cannot be determined, transactions are credited to the country of shipment. Certain foreign trade reports show country subcodes to indicate special tariff treatment afforded some imported articles.
COURIER: Attendant who accompanies shipment(s). Also, some courier companies provide a full transportation function, without accompanying attendants, offering door-to-door air service for time-sensitive documents or small packages on a “same-day” or “next-day” basis.
courier service: A fast, door-to-door service for high-valued goods and documents. Companies usually limit service to shipments weighing fifty pounds or less.
CPT: See Carriage and Insurance Paid to.
Crane: 1) A materials handling device that lifts heavy items. There are two types: bridge and stacker. 2) An owner of Eagle USA.
CREDIT ARRANGEMENTS: A series of programs under which credit is extended to shippers and consignees for the payment of charges.
CREDIT RISK INSURANCE: Insurance that covers the risk of non-payment for delivered goods.
critical value analysis: A modified ABC analysis in which a company assigns a subjective critical value to each item in an inventory.
cross-docking: The movement of goods directly from receiving dock to shipping dock to eliminate storage expense.
Cross-functional team: A multifunctional group of workers (it may be inter-departmental and/or inter-company) that works on a common set of objectives.
CRP: See Continuous Replenishment Program.
CUBE: Slang term for volume capacity of a van trailer.
CUBE OUT: When a container has reached its volumetric capacity before reaching the permitted weight limit.
CUBE RATE: Rate based on space instead of weight and used for light bulky loads.
CUBIC CAPACITY: The carrying capacity within an aircraft or container according to measurement in cubic feet.
currency adjustment factor: An added charge assessed by water carriers for currency value changes.
CUSTOMER AUTOMATION: The use of air carrier automation equipment on the customer's premises that aids in the processing of shipments, i.e., airbill preparations, invoicing, weighing and tracing.
Customer driven: The end user, or customer, motivates what is produced or how it is delivered.
customer service: Activities between the buyer and seller that enhance or facilitate the sale or use of the seller's products or services.
CUSTOMS: A government authority designated to regulate flow of goods to and from a country and to collect duties levied by a country on imports and exports. The term also applies to the procedures involved in such collection.
Customs Bonded Warehouse: A warehouse where imported goods may be stored for a total of three years without the payment of duty or taxes.
Customs Broker: An individual or company licensed by the government to enter and clear goods through Customs. The U.S. Customs Service defines a Customs Broker, as any person who is licensed in accordance with Part III of Title 19 of the Code of Federal Regulations (Customs regulations) to transact Customs business on behalf of others. Customs business is limited to those activities involving transactions with Customs concerning the entry and admissibility of merchandise; its classification and valuation; the payment of duties, taxes, or other charges assessed or collected by Customs upon merchandise by reason of its importation, or the refund, rebate, or drawback thereof.
Customs Clearance: The procedures involved in getting cargo released by Customs through designated formalities such as presenting import license/permit, payment of import duties and other required documentation by the nature of the cargo such as FCC or FDA approval.
Customs Cooperation Council: The CCC (French: Conseil de Cooperation Dounaire, CCD) is an international organization consisting of representatives of about 150 countries. The Council serve as a technical body which studies and seeks to resolve the various countries' customs problems in an attempt to harmonize customs operations and promote trade. The Council was established in 1950; headquarters are in Brussels, Belgium.
Customs Cooperation Council Nomenclature: A customs tariff nomenclature formerly used by many countries, including most European nations but not the United States. It has been superseded by the Harmonized System Nomenclature to which most major trading nations, including the U.S., adhere.
CUSTOMS COURT: A U.S. Customs Services court based in New York, NY, consisting of three 3rd party divisions to which importers may appeal or protest classification and value decisions and certain other actions taken by U.S. Customs.
CUSTOMS DECLARATION: A statement, oral or written, attesting to the correctness of description, quantity, value, etc., of merchandise offered for importation into the USA.
Customs Free Zone: See: Free Trade Zone.
Customs Import Value: This is the U.S. Customs Service appraisal value of merchandise. Methodologically, the Customs value is similar to f.a.s. (free alongside ship) value since it is based on the value of the product in the foreign country of origin, and excludes charges incurred in bringing the merchandise to the United States (import duties, ocean freight, insurance, and so forth); but it differs in that the U.S. Customs Service, not the importer or exporter, has the final authority to determine the value of the good.
CUSTOMS INFORMATION EXCHANGE (CIE): A clearinghouse of information for U.S. Customs Service officers.
Customs Invoice: A document, required by some foreign countries' customs officials to verify the value, quantity, and nature of the shipment, describing the shipment of goods and showing information such as the consignor, consignee, and value of the shipment.
Customs tariff: Schedule of charges assessed by the government on imports/exports.
Customs Union: An agreement between two or more countries in which they arrange to abolish tariffs and other import restrictions on each other's goods and establish a common tariff for the imports of all other countries. The European Community is the most well-known example. The two primary trade effects of a customs union are: (a) trade creation: - the shift from consumption of domestic production toward consumption of member imports and (b) trade diversion: - the shift from trade with non-member countries in favor of trade with member countries.
CUSTOMS VALUATION: This is one of three methods of import valuation. The Customs value represents the value of imports as appraised by the U.S. Customs Service and is primarily used for the collection of import duties. Methodologically, Customs and FAS data are similar since both represent a value in the foreign country and exclude all charges incurred in bringing the merchandise to the United States. Customs valuation replaced FAS valuation beginning with the compilation of the January 1982 data.
CUSTOMHOUSE BROKER: A broker who is certified by U.S. Customs to act for importers and other business men in handling for them the sequence of Customs formalities and other details attendant to the legal and expeditious importing of goods.
CWO: See CASH WITH ORDER.
CWT: See HUNDREDWEIGHT.
CY: The term CY means the location designated by Carrier in the port terminal area for receiving, assembling, holding, storing and delivering containers, and where containers may be picked up by shippers or re-delivered by consignees. No container yard (CY) shall be a shipper's, consignee's, NVOCC's, or a forwarder's place of business, unless otherwise provided.
CY/CFS: The term CY/CFS means containers packed by shipper of carrier's premises and delivered by shipper to Carrier's CY, all at shipper's risk and expense and unpacked by Carrier at the destination port CFS.
CY/CY: The term CY/CY means containers packed by shipper off Carrier's premises and delivered by shipper to Carrier's CY and accepted by consignee at Carrier's CY and unpacked by consignee off Carrier's premises, all at the risk and expense of cargo.
cycle inventory: An inventory system where counts are performed continuously, often eliminating the need for an annual overall inventory. It is usually set up so that A items are counted regularly (i.e., every month), B items are counted semi-regularly (every quarter or six months), and C items are counted perhaps only once a year.
Cycle time: The amount of time from when a product or service is ordered until it is received by the customer.
D/A: See DOCUMENTS
D/P: See DOCUMENTS AGAINST PAYMENT.
DAMAGE CLAIM (FREIGHT): Demand upon carrier for reimbursement for physical injury to shipment or because shipment was not delivered within reasonable time.
DANGEROUS GOODS: Articles or substances which are capable of posting a significant risk to health, safety, or property when transported by air and which are classified according to the most current editions of the CAD Technical Instructions for the Safe Transport of Dangerous Goods by Air and the IATA Dangerous Goods Regulations. Dangerous goods may be transported domestically and internationally by air. Also see HAZARDOUS MATERIALS.
DAT: Abbreviation for “Dangerous articles tariff”.
DATA PLATE: Sign attached to container giving details of weight, dimensions, capacity, etc.
Date Draft: Draft that matures in a specified number of days after the date it is issued, without regard to the date of Acceptance. See Time Draft.
DCA: Abbreviation for “Department of Civil Aviation”. Commonly used term to denote the government department of any foreign country that is responsible for aviation regulation and granting traffic rights.
DDP: See Delivered Duty PAID.
DDU- See DELIVERED DUTY UNPAID.
DE FACTO: Latin phrase meaning “in fact”, used to describe situation which exists regardless of any other condition.
Dead Leg: A sector flown without payload.
Dead Freight: Freight charges paid by the charterer of vessel for the contracted space, which is left partially unoccupied.
DEAD WEIGHT TONNAGE (DWT): 1) Estimated number of tons of cargo a vessel can carry when loaded to maximum depth, obtained by subtracting displacement “light” and “loaded” tonnage and expressed in long tons (2,240 lb.) or metric tons (1,000 kg). Serves as a basis for rates when vessels operate on time charters. 2) Cargo of such nature that a long-ton is less than 70 cubic feet.
DEADHEAD: One leg of a move with either a tractor alone or a tractor pulling an empty container.
PRIVATEdecentralized authority: A situation in which a company management gives decision-making authority to managers at many organizational levels.
decision support system: A set of computer-oriented tools designed to assist managers in making decisions.
DECK CARGO: Cargo carried outside rather than within the enclosed cargo spaces of a vessel. On deck carriage is required for certain commodities, such as explosives.
Declaration by Foreign Shipper: The U.S. Customs Service defines this term as a statement by the shipper in the foreign country attesting to certain facts. For example, articles shipped from the United States to an insular possession and then returned must be accompanied by a declaration by the shipper in the insular possession, indicating that, to the best of his or her knowledge, the articles were exported directly from the United States to the insular possession and remained there until the moment of their return to the United States. (see 19 CFR 4.60 and 4.61 on U.S. clearance of vessels bound for a foreign port or ports.)
DECLARED VALUE: 1) Assumed value of shipment unless shipper declares a higher amount (e.g. Air freight declared value on most shipments has been 50 cents a pound or $50.00, whichever is greater). 2) Process of stating a lower value on a shipment to obtain a lower rate.
DECLARED VALUE FOR CARRIAGE: The value of goods declared to the carrier by the shipper for the purposes of determining charges or of establishing the limit of the carrier's liability for loss, damage, or delay. See VALUATION CHARGES.
DECLARED VALUE FOR CUSTOMS: The selling price of the contents or the replacement cost if the contents are not for resale. The amount must be equal to or greater than the declared value.
Dedicated Contract Carriage: A third-party contractual service that dedicates vehicles and drivers to a single customer for its exclusive use. Usually done in a closed loop or fixed route situation.
defective goods inventory: Those items that have been returned, have been delivered damaged and have a freight claim outstanding, or have been damaged in some way during warehouse handling.
DEFERRED AIR FREIGHT: Air freight requiring dependable, reliable service, but of a less time sensitive nature, with delivery provided over a period of days.
DEFERRED PAYMENT CREDIT: A type of Letter of Credit which provides for payment some time after presentation of the shipping documents by the exporter.
DEFERRED REBATE: The return of a portion of the freight charges by a carrier or a conference shipper in exchange for the shipper giving all or most of his shipments to the carrier or conference over a specified period of time (usually 6 months). Payment of the rate is deferred for a further similar period, during which the shipper must continue to give all or most of his shipments to the rebating carrier or conference. The shipper thus earns a further rebate which will not, however, be paid without an additional period of exclusive or almost exclusive patronage with the carrier of conference. In this way, the shipper becomes tied to the rebating carrier or conference. Although, the deferred rebate system is illegal in U.S. foreign commerce, it generally is accepted in the ocean trade between foreign countries.
DELAY: Even under All Risk coverage, damage due to delay is not recoverable. Most underwriters have inserted a "Delay Cause" in the Open Cargo Policy, which states specifically that damage caused by delay is not recoverable even if the delay was due to a peril insured against.
DELCREDERE: Shifting of risk to somebody else, or acceptance by a party other than the original creditor.
Delivered at Frontier: (DAF) (...named place): Seller delivers the goods at the named point and place at the frontier. Means that the seller's obligations are fulfilled when the goods have arrived at the frontier: - but before "the customs border" of the country named in the sales contract. The term is primarily intended to apply to goods by rail or road but is also used irrespective of the mode of transport.
Delivered Duty Paid (DDP) (...named place of destination): The seller fulfills 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. Whilst the EXW term represents the minimum obligation for the seller, DDP represents the maximum obligation. While the term "Ex Works" signifies the seller's minimum obligation, the term "DDP” when followed by words naming the buyer's premises, denotes the other extreme: - the seller's maximum obligation. The term "Deliver Duty Paid" may be used irrespective of the mode of transport. If the parties wish that the seller should clear the goods for import but that some of the cost payable upon the import of the goods should be excluded: - such as value added tax (VAT) and/or other similar taxes: - this should be made clear by adding words to this effect (e.g., "exclusive of VAT and/or taxes").
Delivered Duty Unpaid (DDU) (...named place of destination): The seller fulfills 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 to bear any risks caused by his failure to clear the goods for import in time. Basically, referring to DDP except buyer pays for the import duty.
Delivered Ex Quay (Duty Paid) (DEQ) (...named port of destination): The seller fulfills 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.
Delivered Ex Ship (DES) (...named port of destination): The seller fulfills 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 has to bear all the costs and risks involved in bringing goods to the named port of destination.
Delivery Instructions: Provides specific information to the inland carrier concerning the arrangement made by the forwarder to deliver the merchandise to the particular pier or steamship line. Not to be confused with Delivery Order which is used for import cargo.
Delivery Verification Certificate: The U.S. Customs Service defines a DVC as a form used to track imported merchandise from the custody of the importer to the custody of a manufacturer and is used to substantiate a manufacturing drawback claim. The DVC is also known as a Certificate of Delivery (Customs Form 331). An export license may be issued with a requirement for delivery verification by Customs in the receiving country. When delivery verification is required by a foreign government for goods imported into the U.S., the U.S. Customs Service will certify a delivery verification certificate (Form ITA-647). A U.S. export license may require submission of a similar form from an importing country.
DELTA NU ALPHA: A transportation fraternity of transportation and traffic practitioners.
DEMURRAGE: The detention of containers by shippers or receivers of freight beyond a specified grace period. In air freight, the airlines tender carrier owned containers to the customer for loading and unloading of the unit. In the event the container is not returned to the carrier within a specified time (usually 36-48 hours) a charge shall be assessed by the carrier for each 24-hour period or fraction thereof beyond the allowed time. Similar processes apply for motor, rail and ocean carriage. Detention means the same thing for motor carriers. Also the excess time taken for loading or unloading a vessel, thus causing delay of scheduled departure. Demurrage refers only to situations in which the charter or shipper, rather than the vessel's operator, is at fault.
DENSITY: A physical characteristic measuring a commodity's mass per unit volume or pounds per cubic foot; an important factor in rate making, since density affects the utilization of a carrier's vehicle. Weight per cubic foot or kilo per meter of space occupied by the article. The cubage of loose articles or pieces, or packaged articles of a rectangular, elliptical or square shape on one plane shall be determined by multiplying the greatest straight line dimensions of length, width and depth in inches, including all projections, and dividing the total by 1728 (to obtain cubic feet). The density is the weight of the article divided by the cubic feet thus obtained. See also dimensional weight.
density rate: A rate based upon the density and shipment weight.
Deposit of Estimated Duties: This refers to antidumping duties which must be deposited upon entry of merchandise which is the subject of an antidumping duty order for each manufacturer, producer or exporter equal to the amount by which the foreign market value exceeds the United States price of the merchandise.
DEREGULATION: Revisions or complete elimination of economic regulations concerning transportation. The Motor Carrier Act of 1980, the Staggers Rail Act of 1980 and the Airline Deregulation Act of 1978 revised the economic controls over motor carriers, railroads and air forwarders respectively.
DEPARTMENT OF TRANSPORTATION (DOT): An executive department of the U.S. Government established by the Department of Transportation Act of 1966 (80 Stat 931) for the purpose of developing national transportation policies. As a result of the Airline Deregulation Act of 1978, the DOT acquired many of the functions of the CAB. For information: 400 7th Street SW, Washington, DC 20590.
DEQ: See Delivered Ex Quay.
DEMAND: The demand for transportation of a product is derived from the demand for the product at some location.
derived demand: The demand for a product's transportation is derived from the product's demand at some location.
DES: See Delivered Ex Ship.
DESICCANT: material that absorbs moisture by physical/chemical action (e.g. Calcium chloride). Desiccants are includes in packages to keep the contents from suffering moisture damage.
Destination Control Statement: Any of various statements that the U.S. government requires to be displayed on export shipments and that specify the destination for which export of the shipment has been authorized.
Detention- See DEMURRAGE. The charge a motor carrier assesses when a shipper or receiver holds a truck or trailer beyond the free time the carrier allows for loading or unloading.
DEVALUATION: The official lowering of the value of one country’s currency in terms of one or more foreign currencies.
DEVANNING: The discharge of cargo from a container.
DGR: Dangerous Goods Requirement.
DIFFERENTIAL: 1) Amount added to/deducted from a base rate to make rate to/from some other point or via another route. 2) Part of power train of vehicle containing gears that convert rotation of drive shaft to turn wheels/axles.
Dim Weight: See Dimensional Weigh.
DIMENSIONAL WEIGHT: Dimensional weight refers to density, i.e. weight per cubic foot. The weight of a shipment per cubic foot is one of its most important transportation characteristics directly involving such factors as the efficient loading of an aircraft and the economy of freight traffic movement. Some commodities, such as machinery, have a relatively high density. Others, like ladies hats, have a relatively low density. Hence, the Dimensional Weight Rule was developed as a practice applicable to low density shipments under which the transportation charges are based on a cubic dimensional weight rather than upon actual weight. Examples in air freight: One pound for each 194 cubic inches of the shipment in the case of most domestic air freight; one pound for each 266 cubic inches of cut flowers or nursery stock shipments; and one pound for each 194 cubic inches of most international shipments. Some carriers give discounts for shipments of high-density goods.
Direct Offset: Involves compensation in related goods and usually involves some form of co-production, license or joint venture. See also OFFSET.
direct product profitability: Calculation of the net profit contribution attributable to a specific product or product line.
Direct Ship: Ship without consolidation and under one MAWB i.e. non-consolidation.
direct store delivery: A logistics strategy to improve services and lower warehouse inventories.
DISC: Abbreviation for and see DOMESTIC INTERNATIONAL SALES CORPORATION.
DISCOUNT: An allowance from the quoted price of goods made usually by the deduction of a certain percentage from the invoice price. See also FINANCIAL DISCOUNT.
DISCRIMINATION: Difference in rates not justified by costs. E.g. Two shipments move under the same circumstances but for different charges.
DISHONOR: Refusal on the part of the drawee to accept a draft or to pay it when due.
DISPATCHER: Person who schedules and controls truck pickups and deliveries. E.g. Assigns drivers/return vehicles to jobs, records departures/return times, investigates overdue vehicles, issues equipment, establishes routes etc.
Dispatching: The carrier activities involved with controlling equipment; involves arranging for fuel, drivers, crews, equipment, and terminal space.
DISPLACEMENT TONNAGE: Weight in long tons of water displaced by capacity of vessel and its cargo.
DISTANCE RATE SYSTEMS: Based on tapering rate principal in which rates increase with distance but not as fast as distance itself. Distance rates are often established for key points.
distribution resource planning: A computer system that uses MRP techniques to manage the entire distribution network and to link it with manufacturing planning and control.
DISTRIBUTION SERVICE: A service under which a carrier accepts one shipment from one shipper and, after transporting it as a single shipment, separates it into a number of parts at destination and distributes them to many consignees. Also see ASSEMBLY SERVICE.
DISTRIBUTION WAREHOUSE: A warehouse that stores finished goods and from which customer orders are assembled.
DISTRIBUTOR: An agent who sells for a supplier directly and maintains an inventory of the supplier’s products.
Distribution License: The DL is a Special License that allows the holder to make multiple exports of authorized commodities to foreign consignees who are approved in advance by the Bureau of Export Administration. The procedure also authorizes approved foreign consignees to re-export among themselves and to other approved countries. Applicants and consignees must establish Internal Control Programs to ensure the proper distribution of items under the DL. Each program must include comprehensive procedures for ensuring that the items exported will be used only for legitimate end-uses.
DIVERSION: Change made in consignee, destination or route of shipment while in transit and to still pay the through rate from origin to final destination.
Diversionary Dumping: This occurs when foreign producers sell to a third country market at less than fair value and the product is then further processed and shipped to another country.
DOC- Abbreviation for “Department of Commerce”
DOCK: 1) Area at warehouse/manufacturing plant where goods are loaded, unloaded and sorted. 2) Slip/waterway between two projections to receive vessels while taking on or discharging cargo or passengers.
DOCK RECEIPT: A steamship company form evidencing receipt of the goods at a pier. Copies of the form are made available to shippers as a means of expediting handling at piers. The dock receipt is used to transfer accountability when the export item is moved by the domestic carrier to the port of embarkation and left with the international carrier for export. The Dock Receipt controls the ownership of the goods until the Bill of Lading is issued.
DOCK STATEMENT: A receipt issued by an Ocean Carrier to acknowledge the receipt of a shipment at the carrier’s dock or warehouse facility.
DOCUMENTARY CREDIT: A commercial letter of credit providing for payment by a bank to the named beneficiary who is usually the seller of merchandise against delivery of such documents as may be specified in the credit.
DOCUMENTS: Papers customarily attached to foreign drafts, consisting of ocean bills of lading, marine insurance certificates, and commercial invoices, and where required, including certificates of origin and consular invoices.
DOCUMENTS AGAINST ACCEPTANCE: Instructions given by a shipper to his bank that the documents attached to a draft for collection are deliverable to the drawee against his acceptance of the draft. Also D/A.
DOCUMENTS AGAINST PAYMENT: Instructions given by a shipper to his bank that the documents attached to a draft for collection are deliverable to the drawee only against his payment of the draft. Also D/P.
DoD: Abbreviation for “Department of Defense”
DOOR-TO-DOOR: Through transportation of a container/trailer and its contents from CONSIGNOR’s loading facility to CONSIGNEE’s unloading facility. The through delivery of cargo from shipper to receiver.
DOLLY: A piece of equipment used to move containers or pallets around the airport with the aid of a tractor.
Domestic Exports: Exports of domestic merchandise include commodities which are grown, produced, or manufactured in one country, and commodities of foreign origin which have been substantially changed in this country, including Foreign Trade Zones, from the form in which they were imported, or which have been enhanced in value by further manufacture in this country.
DOMESTIC INTERNATIONAL SALES CORPORATION: An export sales corporation established by a US Company under US government authorization to promote trade from the USA by giving the exporter economic advantages not available outside such framework.
domestic trunk line carrier: A classification for air carriers that operate between major population centers. These carriers are now classified as major carriers.
DOMICILE: The place where a draft or acceptance is made payable.
DOT: See Department of Transportation.
DOUBLE-STACK: Railcar movement of containers stacked two high.
double bottoms: A motor carrier operation that involves one tractor pulling two trailers.
double-pallet jack: A mechanized device for transporting two standard pallets simultaneously.
Download: To merge temporary files containing a day's or week's worth of information with the main data base in order to update it.
Downstream Dumping: This occurs when foreign producers sell at below cost to a producer in its domestic market, and the product is then further processed and shipped to another country.
DRAWBACK: A refund of duties paid on imported goods which is provided at the time of their re-exportation.
DRAFT: 1) See BILL OF EXCHANGE. 2) Buyer's payment for goods. 3) Depth of water necessary to float vessel.
Draft Bill of Exchange: A written, unconditional order for payment from one person (the drawer) to another (the drawee). It directs the drawee to pay a specified sum of money, in a given currency, at a specific date to the drawer. A Sight Draft calls for immediate payment (on sight) while a Time Draft calls for payments at a readily determined future date.
DRAW: The addressee of a draft. The person on whom the draft is drawn.
DRAWBACK: Refund of customs duties paid on material imported and then later exported. This feature of U.S. Customs law permits a refund of 99% of the duty paid for articles manufactured or produced in the United States with the use of imported merchandise and are later exported. Drawback regulations and procedures vary among countries.
Drawback System: The Drawback System, a part of Customs' Automated Commercial System, provides the means for processing and tracking of drawback claims.
Drawee: The individual or firm on whom a draft is drawn and who owes the indicated amount.
Drawer: The individual or firm that issues or signs a draft and thus stands to receive payment of the indicated amount from the drawee.
DRAYAGE: Transportation of freight by truck, primarily in local cartage.
driving time regulations: U.S. Department of Transportation rules that limit the maximum time a driver may drive in interstate commerce; the rules prescribe both daily and weekly maximums.
Drop: A situation in which an equipment operator deposits a trailer or boxcar at a facility at which it is to be loaded or unloaded.
DROP-OFF: Delivery of a shipment(s) to an air or ocean carrier for transportation.
DROP SHIPMENT: Shipment sent directly from manufacturer to retailer or industrial customers, even though ordered through wholesaler who takes title to goods and unusual wholesale discount.
Dry Lease: The rental of a "clean" aircraft without crew, ground staff or supporting equipment.
DST: The acronym meaning "double stack train" service, which is the transport rail between two points of a trainload of containers with two containers, one on top of the other, per chassis.
DUAL OPERATION: A motor carrier that has both COMMON and CONTRACT CARRIER operating authority.
Dual Pricing: The selling of identical products in different markets for different prices. This often reflects dumping practices.
DUAL-RATE SYSTEM: An international water carrier pricing system whereby a shipper signs an exclusive-use agreement with the Conference and pays a lower rate (10 to 15 percent) than non-signing shippers for an identical shipment.
Dumping: The sale of a commodity in a foreign market at less than fair value. Dumping is generally recognized as unfair because the practice can disrupt markets and injure producers of competitive products in an importing country. Article VI of the GATT permits imposition of antidumping duties equal to the difference between the price sought in the importing country and the normal value of the product in the exporting country. With price-to-price dumping, the foreign producer can use its sales in the high-priced market (usually the home market) to subsidize its sales in the low-priced export market. The price difference is often due to protection in the high-priced market. Price-cost dumping indicates that the foreign supplier has a special advantage. Sustained sales below cost are normally possible only if the sales are somehow subsidized.
Dumping Margin: The amount by which the imported merchandise is sold in the United States below the home market or third country price or the constructed value (that is, at less than its "fair value"). For example, if the U.S. "purchase price" is $200 and the fair value is $220, the dumping margin is $20. This margin is expressed as a percentage of the United States price. In this example, the margin is 10 percent.
DUNNAGE: Cardboard, lumber or other filler material used to stabilize shipment. Does not include packaging.
DUTY: A tax imposed on imports by the Customs authority of a country. Duties are generally based on the value of the goods (ad valorem duties), weight or quantity (specific duties) or a combination of value and other factors (compound duties). Also known as a TARIFF. Also “Specific duty”: An assessment on the weight or quantity of an article without preference to its monetary value or market price and “Duty Drawback”: A recovery in whole or in part of duty paid on imported merchandise at the time of exportation, in the same or different form.
dw: Abbreviation for “Deadweight ton” (tons of 2,240 lbs.)
dwc: Abbreviation for “Deadweight for cargo”
DWT: See Deadweight TONNAGE
Dynamic Asian Economies: A collective reference, currently comprising six Asian countries: Hong Kong, Korea, Malaysia, Singapore, Taiwan, and Thailand.
EAA: See Experimental
EAON: Abbreviation for “Except as otherwise noted”
ECAC: See European Civil Aviation Conference.
Economic Value Added: Measuring the true profitability of an operation by focusing on the total cost of assets, operating costs, inventories, etc.
Economic Zones: Economic zones are designated regions in a country which operate under rules that provide special investment incentives, including duty free treatment for imports, for manufacturing plants which re-export their products. The term "economic zone" is currently used in the People's Republic of China and the former Soviet Union.
Entry Summary Selectivity System: The Entry Summary Selectivity System, a part of Customs' Automated Commercial System, provides an automated review of entry data to determine whether team or routine review is required. Selectivity criteria include an assessment of risk by importer, tariff number, country of origin, manufacturer, and value. Summaries with Census warnings, as well as quota, antidumping and countervailing duty entry summaries are selected for team review. A random sample of routine review summaries is also automatically selected for team review.
ECR: See Efficient consumer response.
EDI: Electronic Data Interchange. Enables computers to talk to computers. Although an investment in computer hardware and software is necessary, EDI allows companies to engage in electronic commerce, exchanging information such as purchase orders to better coordinate their logistics operations. Standardized formats define how information is encoded and permit the flow of data from one database in a company to another. Of particular importance to distribution operations has been the development of the EDI-based advance shipment notice. This tells a consignee what to expect in a shipment before the truck even arrives.
EDIFACT: Electronic Data Interchange for Administration, Commerce and Transportation, is an international syntax used in the interchange of electronic data. Customs uses EDIFACT to interchange data with the importing trade community.
EEC: See EUROPEAN ECONOMIC COMMUNITY.
Efficient consumer response: A supply chain initiative for the grocery industry. ECR is a consumer-driven system of replenishment in which high-quality products and accurate information flow through a paperless (EDI) system between all distribution points from manufacturing line to checkout counter.
Efficient foodservice response: A supply chain initiative for the foodservice industry, a.k.a. ECR without the coupons. Growth in the quick-service restaurant and correctional industries has provided EFR with a solid foundation for growth.
EFR: See Efficient foodservice response
EIN: Employer Identity Number.
EIR: See EQUIPMENT INTERCHANGE RECEIPT.
Electronic Data Interchange: See EDI
Electronic Point of Sale: A computerized system for recording sales at retail checkouts.
EMBARGO: 1) Temporary refusal to accept traffic for transportation at certain points or in certain routes due to emergencies, limitations of facilities or other abnormal circumstances. 2) Detention of vessel in port by order of government usually issued in time of war or hostilities.
Empty Leg: Results from an aircraft primarily chartered outbound having cargo capacity inbound or vice versa. A cheap form of airfreight.
ENDORSE: Sign one’s name on back of document such as a check or Bill of Lading.
Endorsement in Blank: Commonly used on a bank check, an endorsement in blank is an endorsement to the bearer. It contains only the name of the endorser and specifies no particular payee. Also, a common means of endorsing Bills of Lading dawn to the order of the shipper. The bills are endorsed "For..." (see Bill of Lading, Order).
Entrepot: An intermediary storage facility where goods are kept temporarily for distribution within a country or for re-export.
Entry Summary Selectivity System: The Entry Summary Selectivity System, a part of Customs' Automated Commercial System, provides an automated review of entry data to determine whether team or routine review is required. Selectivity criteria include an assessment of risk by importer, tariff number, country of origin, manufacturer, and value. Summaries with Census warnings, as well as quota, antidumping and countervailing duty entry summaries are selected for team review. A random sample of routine review summaries is also automatically selected for team review.
Entry Summary System: An entry is the minimum amount of documentation needed to secure the release of imported merchandise. The Entry Summary System, a part of Customs' Automated Commercial System, contains data on release, summary, rejection, collection, liquidation, and extension or suspension.
Entry Value: The U.S. Customs Service defines entry value (or entered value) as the value reflected on the entry documentation submitted by the importer. (see 19 CFR 141.61 for how shown on entry.)
EPOS: See Electronic Point of Sale (EPOS): a computerized system for recording sales at retail checkouts.
EQUIPMENT INTERCHANGE RECEIPT (EIR): Form used by parties delivering/receiving containers or container equipment. Used for container control an damage purposes.
ERAA: See European Regional Airlines Association.
ESTOPPEL: Legal document used in a court of law to establish liability.
ETA: Abbreviation for “Estimated time of arrival”. Then, It normally takes 4 hours for carriers to Break Bulk then ready to be picked up by forwarders along with customs release notification.
ETD: Abbreviation for “Estimated time of departure”. The cut-off time for carriers' cargo ramp handling is normally two hours ahead of ETD. However, the freight forwarder’s' consolidation cut-off time may vary depending on each forwarder's operations respectively.
ETIOLOGIC AGENTS: As defined in the HAZARDOUS MATERIAL REGULATIONS in 49 CFR. Viable microorganisms or their toxins which may cause human disease.
EURO DOLLAR: U.S. funds deposited in banks outside the USA. This usually means banks in Europe or the European Union.
European Regional Airlines Association (ERAA): This organization is the voice of Europe’s regional air transport industry.
EUROCONTROL: Founded in 1960 for overseeing air traffic control in the Upper Air-space of Member States, this organization has, as its most important goal, the development of a coherent and coordinated air traffic control system in Europe.
European Civil Aviation Conference (ECAC): An inter-governmental organization founded in 1955. The ECAC has today 37 Member States. It’s aim is to promote the continued development of a safe, efficient and sustainable European air transport system.
European Community: A regional organization created in 1958 providing for gradual elimination of intra-regional customs duties and other trade barriers, applying a common external tariff against other countries, and providing for gradual adoption of other integrating measures, including a Common Agricultural Policy (CAP) and guarantees of free movement of labor and capital. The original 6 members were Belgium, France, West Germany, Italy, Luxembourg, and the Netherlands. Denmark, Ireland, and the United Kingdom became members in 1973; Greece acceded in 1981; Spain and Portugal in 1986. The term European Community (EC) refers to three separate regional organizations which operate under separate treaties: European Coal and Steel Community (ECSC), established in 1952; European Atomic Energy Community (EURATOM), established in 1958, and European Economic Community (EEC), established in 1958. Since 1967, the European Community have been served by four common institutions: - the EC Commission, the EC Council, the European Parliament, and the Court of Justice of the European Community. The present 12 member states of the EC are also members of the ECSC and Euratom. While the expression "European Community" (or "EC") was meant to refer to the three Communities, frequent use of the expression "European Community" (or "EC") has become common as a reference to the European Economic Community (EEC). Prior to November 1, 1993 (the date on which the Maastricht Treaty on European Union entered into force), the acronym "EC" was used as a reference to "European Community" and "European Communities." Part I, Article I of the Maastricht Treaty on European Union formalized "EC" as a reference to "European Community." The Treaty also introduced the term "European Union" as a broader legal entity than the European Community.
EUROPEAN ECONOMIC COMMUNITY (EEC): Common market nations of Europe.
European Union: The EU is an umbrella reference to the European Community (EC) and to two European integration efforts introduce by the Maastricht Treaty: Common Foreign and Security Policy (including defense) and Justice and Home Affairs (principally cooperation between police and other authorities on crime, terrorism, and immigration issues). The term "European Union" was introduced in November 1993 (when the Maastricht Treaty on European Union entered into force). The term "European Community" (EC) continues to exist as a legal entity within the broader framework of the EU.
EX: As a prefix, means “out” or “from” when used in conjunction with a noun or location. Means all transportation charges and risks of loss/damage are chargeable to buyer when goods are delivered to carrier at "ex" location. When used in pricing terms such as "Ex Factory" or "Ex Dock," it signifies that the price quoted applies only at the point of origin (in the two examples, at the seller's factory or a dock at the import point). In practice, this kind of quotation indicates that the seller agrees to place the goods at the disposal of the buyer at the specified place within a fixed period of time.
Ex Quay: "Ex Quay" means that the seller makes the goods available to the buyer on the quay (wharf) at the destination named in the sales contract. The seller has to bear the full cost and risk involved in bringing the goods there. There are two "Ex Quay" contracts in use: (a) Ex Quay "duty paid" and (b) Ex Quay "duties on buyer's account" in which the liability to clear goods for import is to be met by the buyer instead of by the seller.
Ex Ship: "Ex Ship" means that the seller will make the goods available to the buyer on board the ship at the destination named in the sales contract. The seller bears all costs and risks involved in bringing the goods to the destination.
Ex Works (EXW): This represents the minimum risk and cost for the supplier and the maximum risk and cost for the buyer. The seller's only responsibility is to make the goods available at his premises. He is not responsible for loading the goods on the vehicle provided by the buyer, unless otherwise agreed. The buyer bears all costs and risks involved in taking the goods from the seller's premises.
EXCEPTION RATINGS: Rates set at a certain percentage above the general commodity rates because they apply to commodities that require special handling, such as live animals, human remains, or automotive vehicles.
EXCESS VALUATION: See DECLARED VALUE.
EDI or EDIFACT: Electronic Data Interchange for Administration, Commerce and Transport, from the UN-backed electronic data interchange standards body, to create electronic versions of common business documents that will work on a global scale. One digital document under consideration, the International Forwarding and Transport Message will do the jobs of six different electronic messages currently in use.
EXCLUSIVE USE: Carrier vehicles that are assigned to a specific shipper for its exclusive use.
EXEMPT CARRIER: Motor carrier engaged in for-hire transportation of commodities exempt from economic regulations by the ICC under provisions of the Interstate Commerce Act. Generally seafood or agricultural commodities.
EXPEDITING: Moving shipments through regular channels at accelerated pace. An example of dispatching LTL quantities on a single truck for quick delivery.
Experimental Aircraft Association (EAA): This organization is dedicated to serving all of aviation by fostering and encouraging individual participation, high standards and access to the world of flight in an environment that promotes freedom, safety, family and personal fulfillment.
EXPLOSIVES: As defined in the HAZARDOUS MATERIAL REGULATIONS in 49 CFR. Any chemical compound, mixture or device for which the function is an explosion. Further defined into Class A, B, C and Blasting Agents.
Export Administration Act: The EAA of 1979, as amended, authorizes the President to control exports of U.S. goods and technology to all foreign destinations, as necessary for the purpose of national security, foreign policy, and short supply. As the basic export administration statute, the EAA is the first big revision of export control law since enactment of the Export Control Act of 1949. The EAA is not a permanent legislation; it must be reauthorized: - usually every three years. There have been reauthorizations of the EAA in 1982, 1985 (the Export Administration Amendments Act), and 1988 (Omnibus Amendments of 1988) which have changed provisions of the basic Act. The Act was extended in 1993 until June 30, 1994.
EXPORT BROKER: An individual or company that brings buyers and sellers together for a fee but does not take part in the actual sales transaction.
Export Control Classification Number: Every product has an export control classification number (formerly: Export Control Commodity Number) within the Commerce Control List. Each ECCN consists of five characters that identify the category, product group, type of control, and country group level of control.
Export Declaration: A form to be completed by the exporter or their authorized agent and filed in triplicate by a carrier with the United State Collector of customs at the point of exit. It serves a twofold purpose: 1) Primarily, it is used by the U.S. Bureau of Census for the compilation of export statistics on United States foreign trade (For this reason an export declaration is required for practically all shipments from the United States to foreign countries and the United States possessions, except for mail shipments of small value, or for those of a non commercial character) and 2) The declaration also serves as an export control document because it must be presented, together with the export license, to the United States Customs at the port of export. If the goods may be exported under general export license, this fact must be stated on the export declaration. See also SHIPPER’S EXPORT DECLARATION
EXPORT CONTROL: An exercise control over exports for statistical and strategic purposes. U.S. Customs enforces the export control laws for the U.S. Department of Commerce and other Federal agencies.
EXPORT LETTER OF CREDIT: When importer has arranged with bank for letter of credit financing of purchases, importer applies for issuance of individual letters of credit to cover purchase contracts as made.
Export License: A government document (also known as an "Individual Validated License") authorizing exports of specific goods in specific quantities to a particular destination. This document may be required in some countries for most or all exports and in other countries only under special circumstances. An export license is often required if a government has place embargoes or other restrictions upon exports.
EXPORT MANAGEMENT COMPANY: A private company that serves as the export department for several manufacturers soliciting and transacting export business on behalf of its clients in return for a commission, salary, or retainer plus commission.
Export Processing Zones: EPZs are a form of free trade zone which provide incentives for industrial or commercial export activity. Export processing zones are located in developing countries and are usually in defined areas, industrial parks, or facilities which provide free trade zone benefits and usually offer additional incentives, such as exemption from normal tax and business regulations. The zones, which began appearing around 1975, are sometimes referred to as Special Economic Zones or Development Economic Zones.
Export Revolving Line of Credit: The Export Revolving Line of Credit, ERLC, is a form of financial assistance provided by the Small Business Administration (SBA). The ERLC guarantees loans to U.S. firms to help bridge the working capital gap between the time inventory and production costs are disbursed until payment is received from a foreign buyer. SBA guarantees 85 percent of the ERLC subject to a $750,000 guarantee limit. The ERLC is granted on the likelihood of a company satisfactorily completing its export transaction. The guarantee covers default by the exporter, but does not cover default by a foreign buyer; failure on the buyer's side is expected to be covered by letters of credit or export credit insurance. Under SBA's ERLC program, any number of withdrawals and repayments can be made as long as the dollar limit on the line of credit is not exceeded and disbursements are made within the stated maturity period (not more than 18 months). Proceeds can be used only to finance labor and materials needed for manufacturing, to purchase inventory to meet an export order, and to penetrate or develop foreign markets. Examples of eligible expenses for developing foreign markets include professional export marketing advice or services, foreign business travel, and trade show participation. Under the ERLC program, funds may not be used to purchase fixed assets.
EXPORT SERVICE: Airlines, ocean carriers and freight forwarders perform, at the request of shippers, many services relating to the transfer, storage and documentation of freight destined for export. The same is true of imports. A narrower application of the term 'Export Service" refers to the air movement of goods having a subsequent movement by ocean vessel. Some airlines have a tariff on such traffic which sets forth a rate covering the air transportation, from airport of origin to seaport and all relevant transfer and documentation procedures. On freight arriving in the USA via an ocean vessel and having a subsequent movement by air, some airlines have a similar tariff program known as "Import Service”
EXPORT TRADING COMPANY: Similar to an export management company.
Exporter's Certificate of Origin: The U.S. Customs Service defines an Exporter's Certificate of Origin (also known as Customs Form 353) as a document completed by the exporter, certifying that the goods described therein are eligible for a preferential rate of duty under some trade program such as the U.S.-Canada Free-Trade Agreement. (See 19 CFR 10.37(d)(1).)
Express: Premium-rated service for urgent deliveries.
External Dimensions: The extreme outside measurements, including any handles or other protrusions, of a ULD.
External Volume, ULD: The amount of space a ULD occupies in an aircraft calculated using the extreme external dimensions of the unit.
Euro Dollars: Euro Dollars are deposits of U.S. dollars in banks or other financial institutions which are located outside the borders of the United States. In every other way, Euro Dollars are identical to any other U.S. dollars. These same dollars are also called offshore dollars, or depending where the money is on deposit.
F&D: Abbreviation for
“Freight and Demurrage”.
FAA: See FEDERAL AVIATION ADMINISTRATION.
FACE VALUE: Nominal value on coin, paper currency or other negotiable document or instrument; may be lower or higher than the market value.
FACILITATION: Programs to expedite the flow of international commerce through modernizing and simplifying Customs procedures, duty collection, and other procedures to which inter-national cargo and passengers are subject. The ATA Facilitation Committee pursues this work with Government agencies in the United States and other countries. Examples of progress in facilitation include the elimination of certain export declaration requirements, more expeditious release of cargo from Customs and clearance of cargo at point of origin.
FACTOR: Agent appointed to sell goods on commission. Also known as a COMMISSION MERCHANT.
FAIR MARKET VALUE: The sum that a sale of an article would bring under normal market conditions.
FAK: See “Freight All Kinds”. See also ALL-COMMODITY RATE and GENERAL COMMODITY RATE.
Fathom: Nautical term. Conversion equivalents: 6 feet or 1.83 meters.
Fcsrcc: Abbreviation for “Free of capture, seizure, riots and civil commotions”.
FC&S: Abbreviation for “Free of Capture & Seizure” A clause excluding war risks from the Marine Policy. War risks can be covered by issuing a separate War Policy with an additional premium being charged.
FCL: Abbreviation for “Full Container Load”. The maximum permissible weight for the value of the cargo contained in a container.
FDA: The U.S. Food and Drug Administration.
FEDERAL AVIATION ADMINISTRATION (FAA): Created under the Federal Aviation Act of 1958 as the Federal Aviation Agency and charged with the responsibility of promulgating operational standards and procedures for all classes of aviation in the USA. With the creation of the cabinet level, Department of Transportation in 1966, the FAA became a unit within the new Department and received the new designation Federal Aviation Administration. The FAA Administrator, however, continues to be a presidential appointee and the FAA remains a separate entity with most of its former functions. In the field of air cargo, the FAA promulgates certain stress standards which must be met in the tiedown of cargo in flight. The FAA is the element of the U.S. government with primary responsibility for the safety of civil aviation. Major functions include regulating civil aviation to promote safety and fulfill the requirements of national defense, encouraging and developing civil aeronautics, including new aviation technology, developing and operating a common system of air traffic control and navigation for both civil and military aircraft, research and development with respect to the National Airspace System and civil aeronautics, developing and implementing programs to control aircraft noise and other environmental effects of civil aviation and regulating U.S. commercial space transportation. For information: 800 Independence Avenue SW, Washington, DC 20591
FEDERAL HIGHWAY ADMINISTRATION (FHWA): The division of the U.S. Department of Transportation in charge of the nation’s highway system which administers federal aid for highway construction, develops safety standards and programs and has jurisdiction over the safety of commercial motor carriers engaged in interstate commerce.
FEDERAL MARITIME COMMISSION (FMC): Established in 1961 as an independent government agency responsible for the regulation of shipping in the foreign trades of the United States. The Commission's five members are appointed by the President with the advice and consent of the Senate. The FMC is headquartered at 800 North Capitol Street, N.W., Washington, D.C. 20573 with five Area Representatives around the USA. The FMC's jurisdiction encompasses many facets of the maritime industry. However, it has no jurisdiction over vessel operations, navigation, vessel construction, vessel documentation, vessel inspection, licensing of seafaring personnel, maintenance of navigational aids or dredging. These activities are handled by other federal, state and local agencies. The principal shipping statutes administered by the FMC are the Shipping Act of 1984 (46 USC app. 1710 et seq.), the Foreign Shipping Practices Act of 1988 (46 USC app. 1701 et seq.), and section 19 of the Merchant Marine Act, 1920 (46 USC app. 876). The FMC's regulations are published in 46 CFR 500 et seq. The FMC controls the services, practices and agreements of international water carriers and non-contiguous domestic water carriers.
FEDERAL REGISTER: Government publication that prints rules and regulations of federal agencies on a daily basis. In most cases, rules and regulations must be published to become legal.
FEEDER: In intermodal context, a pickup or delivery vehicle or ship.
FEEDER SERVICES: Coastal movement of loaded or empty containers on board smaller container vessels which coordinate with a “mother ship” for the ocean voyage.
FEU: Abbreviation for a “Forty-Foot Equivalent Unit” or a 40 foot dry cargo container.
FHWA: See FEDERAL HIGHWAY ADMINISTRATION.
FIATA: See International Federation of Freight Forwarders' Associations.
FIB: Abbreviation for “Free in Bunkers” or “Free into Barge”.
FIFO: Abbreviation for “First-In-First-Out”. Warehouse and accounting term meaning the first items stored are the first items used.
Fifth Freedom Flight: Where cargo is carried by an airline between two countries in neither of which it is based.
FILING OF TARIFFS: Requirement that tariffs/supplements/re-issues/other schedules be in the hands of the regulating body such as the FMC or ICC at specific time prior to effective date.
FINANCIAL DISCOUNT: A deduction form the face value of commercial paper such as Bills of Exchange and acceptance in consideration of receipt by the seller of cash before maturity date. The rates of discount vary according to the state of the money market, the financial standing of the drawee to accept a draft or to pay it when due.
FISCAL YEAR: Annual period established for accounting purposes in business or government. May start at any time in the calendar year.
Flag Carrier: An airline of one national registry whose government gives it partial or total monopoly over international routes.
Flag of convenience: A shipowner registers a ship in a nation that offers conveniences in the areas of taxes, manning and safety requirements. Liberia and Panama are the two nations best known.
FLAMMABLE LIQUID: As defined in the HAZARDOUS MATERIAL REGULATIONS in 49 CFR. Any liquid other than an EXPLOSIVE having a flash point below 100 degrees F except liquids which meet definition of compress gas or that are part of a mixture where other components with flash points above 100 degrees F make up at least 99% of the mixture.
FLAMMABLE SOLID: As defined in the HAZARDOUS MATERIAL REGULATIONS in 49 CFR. Any solid material other than an EXPLOSIVE which under conditions incidental to transportation is liable to cause fires through friction, retained heat from manufacturing/processing or which can be ignited readily.
FLASH POINT: Minimum temperature at which substance gives off flammable vapors which will ignite when they come in contact with a spark or flame.
FLASH VESSELS: Shallow draft vessels suitable to carry 8 to 15 barges at a time towed by seagoing vessels.
FLATBED: Trailer with level bed and no sides or tops.
FLAT-RACK CONTAINER: A container with no sides and frame members at the front and rear of the container. Container can be loaded from the sides or the top.
Flexible specialization: A strategy based on multi-use equipment, skilled workers and innovative senior management to accommodate the continuous change that occurs in the marketplace.
Flight Safety Foundation: An independent, nonpolitical, nonprofit organization offering an objective view of aviation safety developments. The Foundation uses the Internet to maximize dissemination of its publications, seminars, special reports and calendar of events.
FLOOR LOAD RATING: Weight that can be safely supported by floor. Expression in pound per square foot.
FMC: See FEDERAL MARITIME COMMISSION.
FILS: French for “Sons” at the end of a business company’s name.
FOB: See FREE ON BOARD
FOD : Abbreviation of “Free of Damage”.
FOIA: Abbreviation for the US “Freedom of Information Act”
FOIR: Abbreviation for “Freedom of Information Request”
Folded: An article folded in such a manner as to reduce its bulk 33 1/3% from its normal shipping cubage when not folded.
FOOTPRINT: Slang expression for the amount of tire tread on the ground.
FOR-HIRE CARRIER: A carrier that provides transportation service to the public on a fee basis.
FORCE MAJEURE: Condition in contract that relieves either party from obligation where major unforeseen events prevent compliance with the provisions of an agreement.
FORE AND AFT: 1) At bow and stern, all over ship. 2) The direction on a vessel parallel to the centerline.
Foreign Access Zone: FAZ is a term adopted by Japan for its form of free trade zone. FAZs are the outgrowth of Japan's effort to improve its trade balance and to stimulate regional economic areas. FAZs are intended to be established around airports and seaports, with facilities (warehouses, cargo-sorting, distribution, import processing, wholesale, design-in centers, exhibition halls) on an international scale. The FAZ concept: - which emphasizes imports rather than the processing and job creation: - extends from the July 1992 Law on Extraordinary Measures for the Promotion of Imports and the Facilitation of Foreign Direct Investment in Japan. Passage of the law is linked to the Structural Impediments Initiative (SII).
Foreign Exports: Exports of foreign merchandise (re-exports), consist of commodities of foreign origin which have entered the United States for consumption or into Customs bonded warehouses or U.S. Foreign Trade Zones, and which, at the time of exportation, are in substantially the same condition as when imported.
FOREIGN FLAG: A reference to a carrier not registered in the USA that flies the American flag. The term applies to air and sea transportation.
FOREIGN TRADE ZONE: FTZs are the U.S. form of free trade zones. These zones are restricted-access sites in or near ports of entry, that operate under public utility principles to create and maintain employment by encouraging operations in the U.S. which might otherwise have been carried on abroad. Goods brought into a zone for a bona fide Customs reason are exempt from state and local ad valorem tax. The zones are licensed by the Commerce Department's Foreign-Trade Zones Board and operate under the supervision of the Customs Service. Quota restrictions do not normally apply to foreign goods stored in zones, but the Board can limit or deny zone use in specific cases on public interest grounds. Domestic goods moved into a zone for export may be considered exported upon entering the zone for purposes of excise tax rebates and drawback. A foreign trade "subzone" is a non-contiguous zone site located at a manufacturing plant.
Foreign Trade Zone Entry: A form declaring goods which are brought duty free into a Foreign Trade Zone for further processing or storage and subsequent exportation.
FORKLIFT: Freight/material handling vehicle used in loading and unloading.
FORMAL ENTRY: Generally, a formal entry is filed when an informal entry is inappropriate, usually when the value of a shipment exceeds US$1,250. It must be noted that U.S. Customs may require a formal entry at any time, and some commodity restrictions apply (i.e. All textile products, antidumping, plastic or rubber articles and merchandise having Visa or Quota conditions).
FORWARDING AGENT: Individual or company specializing in shipping goods. Payments made for insurance and other expenses can be charged to foreign buyers. See also FREIGHT FORWARDER.
FOUL BILL OF LADING: A receipt for goods issued by a carrier with indication that the goods were damaged when received from the shipper.
FPA: Abbreviation for “Free of Particular Average” A marine insurance term. A term used in marine insurance policies to indicate that while the underwriter is unwilling to assume liability for ordinary partial losses due to the peculiar qualities of the particular article or to its form of package, he is willing to bear partial losses, the direct result of stranding, sinking, burning, collision, or other named peril
FPAAC: Abbreviation for “Free of Particular Average, American Conditions. An marine insurance term. The American form of clause commonly used, as distinguished from that used by the English underwriters. Under the American clause the underwriter does not assume responsibility for partial losses unless caused by stranding, sinking, burning or collision with another vessel whereas under the English clause, the underwriter assumes responsibility for partial losses if the vessel be stranded, sunk, burnt or in collision even though such an event did not actually cause the damage suffered by the goods. Conditions.
Free Alongside Ship (FAS) (...named port of shipment): The seller fulfills his obligation to deliver when the goods have been placed alongside the vessel on the quay or in lighters at the named port of shipment. This means that the buyer has to bear all costs and risks of loss or of damage to the goods from that moment. The FAS term requires the buyer to clear the goods for export. FAS is also a method of export and import valuation.
Free Carrier (FCA) (...named place or point): The seller fulfills his obligation to deliver when he has handed over the goods, cleared for export, into the charge of the carrier named by the buyer at the named place or point. This term replaces the former "FOB named inland port" to designate the seller's responsibility for the cost of loading goods at the named shipping point. It may be used for multi-modal transport, container stations, and any mode of transport, including air.
FREE DOMICILE: A term used in international transportation where the shipper pays all transportation charges and any applicable duties and/or taxes.
Free In: A pricing term indicating that the charterer of a vessel is responsible for the cost of loading goods onto the vessel.
Free In and Out: A pricing term indicating that the charterer of a vessel is responsible for the cost of loading and unloading goods from the vessel.
Free In and Out: Cost of loading and unloading a vessel is borne by the charterer.
Free of Particular Average (FPA): A type of marine insurance, is the minimum coverage in use and covers total and partial losses if the ship carrying an exporter's goods is involved in a collision or fire, or is stranded or sunk.
Free of Capture & Seizure: See FC&S
Free On Board (FOB) (...named port of shipment): A pricing term indicating that the quoted price includes the cost of loading the goods into transport vessels at the specified place. The seller fulfills his obligation to deliver when the goods have passed over the ship's rail at the named port of shipment. This means that the buyer has to bear all costs and risks of loss of or damage to the goods from that point. The FOB term requires the seller to clear the goods for export. This term can only be used for sea or inland waterway transport. When the ship's rail serves no practical purpose, such as in the case of roll-on/roll-off or container traffic, the FCA term is more appropriate to use. North American sellers and buyers tend to use the term "FOB" inappropriately.
Free On Rail/Free On Truck: These terms are synonymous, since the word "truck" relates to the railway wagons. The terms should only be used then the goods are to be carried by rail. Free on Railroad defines seller's responsible for the cost of goods is to the point of loading it to the trains' loading deck. FOR normally comes with loading railroad station where the goods is to be loaded.
Free Out: A pricing term indicating that the quoted prices includes the cost of unloading the goods from the vessel.
Free Port: A port which is a foreign trade zone, open to all traders on equal terms. More specifically a port where merchandise may be stored duty-free, pending re-export or sale within that country. Examples include Hong Kong and Singapore.
FREE TIME: The amount of time allowed by a carrier for the loading or unloading of freight at the expiration of which demurrage or detention charges will accrue.
FREE TRADE ZONE: "Free Trade Zones" (sometimes called "customs free zones" or "duty free zones") is a generic term referring to special commercial and industrial areas at which special customs procedures allow the importation of foreign merchandise (including raw materials, components, and finished goods) without the requirement that duties be paid immediately. If the merchandise is later exported, duty free treatment is given to re-exports. The zones are usually located in or near ports of entry. Merchandise brought into these zones may be stored, exhibited, assembled, processed or used in manufacture prior to re-export or entry into the national customs territory. When manufacturing activity occurs in free trade zones, it usually involves a combination of foreign and domestic merchandise, and usually requires special governmental authority. Types of free trade zones include: foreign trade zones (and foreign trade sub-zones); free ports; and transit zones. See FOREIGN TRADE ZONE.
FREIGHT: 1) Property and commodities of all kinds, including small package service, tendered to a carrier for transportation. Does not include mail, express, or passenger baggage. 2) The money charged by the carrier for transporting goods.
Freight All Kinds: Uniform airline charging scale applying to a number of commodities as opposed to SCR (Specific Commodity Rate) applying to one commodity only.
FREIGHT BILL: The carrier’s invoice for transportation charges applicable to a freight shipment.
Freight Carriage ... paid to: Like C & F, "Freight/Carriage paid to ..." means that the seller pays the freight for the carriage of the goods to the named destination. However, the risk of loss of or damage to the goods, as well as of any cost increases, is transferred from the seller to the buyer when the goods have been delivered into the custody of the first carrier and not at the ship's rail. The term can be used for all modes of transport including multi-modal operations and container or "roll on-roll off" traffic by trailer and ferries. When the seller has to furnish a bill of lading, waybill or carrier's receipt, he duly fulfills this obligation by presenting such a document issued by the person with whom he has contracted for carriage to the named destination.
Freight Carriage ... and Insurance paid to: This term is the same as "Freight/Carriage Paid to ..." but with the addition that the seller has to procure transport insurance against the risk of loss of damage to the goods during the carriage. The seller contracts with the insurer and pays the insurance premium.
FREIGHT FORWARDER: 1) Individual or company that accepts less-than-truckload (LTL) shipments and consolidates them into truckload lots on for-hire basis for shippers. 2) Agent who helps expedites shipments by preparing necessary documents and making other arrangements for the moving of freight. 3) Designated as a common carrier under the ICC. 4) An independent business which handles export shipments for compensation. At the request of the shipper, the forwarder makes the actual arrangements and provides the necessary services for expediting the shipment to its overseas destination. The forwarder takes care of all documentation needed to move the shipment from origin to destination, making up and assembling the necessary documentation for submission to the bank in the exporter's name. The forwarder arranges for cargo insurance, makes the necessary overseas communications, and advises the shipper on overseas requirements of marking and labeling. The forwarder operates on a fee basis paid by the exporter and often receives an additional percentage of the freight charge from the common carrier. An export freight forwarder must be licensed by the Federal Maritime Commission to handle ocean freight and by the International Air Transport Association (IATA) to handle air freight. An ocean freight forwarder dispatches shipments from the United States via common carriers, books or arranges space for the shipments, and handles the shipping documentation.
FREIGHT IN BOND: Goods shipped under control/ownership of Government until duty is paid. See also IN BOND.
FREIGHTER: See ALL-CARGO AIRCRAFT.
FTP: Abbreviation for “File Transfer Protocol”.
G-7 (GROUP OF SEVEN):
Seven industrial countries (The USA, Japan, Germany, France, the
United Kingdom, Italy and Canada): whose leaders have met at annual
economic summits since 1975 to coordinate economic policies.
GA: See General AVERAGE
GAGE (GAUGE OF TRACK): Distance between heads of rails, measured at right angles at a point 5/8 inches below the top of the rail. Standard gage is 4 ft. 8 ¼ inches. Narrower gage is frequently employed in construction/scenic areas.
Gang: Group of stevedores usually 4 to 5 members with supervisor assigned to a hold or portion of the vessel being loaded or unloaded.
GAO: Abbreviation for “General Accounting Office”
GATEWAY: Point at which freight is interchanged/interlined between carriers or at which carriers joins two operating authorities provision of through service. In the context of travel activities, gateway refers to a major airport or seaport. Internationally, gateway can also mean the port where customs clearance takes place.
GATT (GENERALIZED AGREEMENT ON TARIFFS AND TRADE): A multilateral treaty designed to help reduce trade barriers between signatory countries and to promote trade through tariff elimination and concessions. The GATT is a binding contract among (in early 1992) 103 governments. GATT was established in 1947 as an interim measure pending the establishment of the International Trade Organization, under the Havana Charter. The International Trade Organization (ITO) was never ratified by Congress. Operating in the absence of an explicit international organization, GATT has provided the legal framework for international trade with its primary mission being the reduction of trade barriers.
gathering lines: Oil pipelines that bring oil from the oil well to storage areas.
GAUGE OF TRACK: See GAGE.
GBL: Abbreviation for “Government Bill of Lading”.
GCR: Abbreviation for “General Cargo Rate”. The basic tariff category which was introduced to cover most air cargo now covers only a minority, the remainder being under SCR or class rates.
GENERAL AVERAGE: Ancient principle of equity in which all parties in a sea adventure (ship, cargo, and freight) proportionately share losses resulting from a voluntary and successful sacrifice of part of the ship or cargo to save the whole adventure from an impending peril, or extraordinary expenses necessarily incurred for the joint benefit of ship and cargo.
GENERAL AVERAGE SECURITY: Documents the cargo owner presents to the General Average Adjuster to replace the vessel owner's maritime lien on cargo for its share of General Average and to obtain release of the goods by the Steamship Company. G.A. Security consists of a G.A. Bond and either a cash deposit or an Underwriter's Guarantee.
GENERAL CARGO: Term applying to ship’s loading comprising a variety of goods/articles and not confined to a single commodity.
general-commodities carrier: A common motor carrier that has operating authority to transport general commodities or all commodities not listed as special commodities.
GENERAL COMMODITY RATE: A rate applicable on all commodities except those for which specific rates have been filed. Such rates are usually based on weight and distance for each pair of cities served. See also ALL-COMMODITY RATE.
GENERAL LICENSE: There are licenses, authorized by the Bureau of Export Administration, that permit the export of non-strategic goods to specified countries without the need for a validated license. No prior written authorization is required and no individual license is issued.
GENERAL LICENSE G-DEST: General license-shipments of commodities to destinations not requiring a validated license. The majority of all items exported fall under the provisions of General License G-DEST.
general-merchandise warehouse: A warehouse used to store goods that are readily handled, are packaged and do not require a controlled environment.
GENERAL ORDER (GO): Government contract warehouse for the storage of cargoes left unclaimed for ten working days after availability. Unclaimed cargoes are auctioned publicly after one year.
General Tariff: A tariff that applies to countries that do not enjoy either preferential or most-favored-nation tariff treatment. Where the general tariff rate differs from the most-favored-nation rate, the general tariff rate is usually the higher rate.
GENERALIZED AGREEMENT ON TARIFFS AND TRADE: See GATT.
GENERALIZED SYSTEM OF PREFERENCE: This is a set of non-reciprocal trade concessions which industrialized countries have agreed to extend to qualified “Less Developed Countries (LDCs). It permits duty-free entry of numerous manufactured or agricultural products, in addition to those products already classified as duty-free under MFN status. To qualify for GSP, all articles must satisfy the relevant rules of origin and be imported from the beneficiary country. It is a framework under which developed countries give preferential tariff treatment to manufactured goods imported from certain developing countries. GSP is one element of a coordinated effort by the industrial trading nations to bring developing countries more fully into the international trading system. The U.S. GSP scheme is a system of non-reciprocal tariff preferences for the benefit of these countries. The U.S. conducts annual GSP reviews to consider petitions requesting modification of product coverage and/or country eligibility. United States GSP law requires that a beneficiary country's laws and practices relating to market access, intellectual property rights protection, investment, export practices, and workers rights be considered in all GSP decisions.
GNP- See Gross National Product
going-concern value: The value that a firm has as an entity, as opposed to the sum of the values of each of its parts taken separately. Particularly important in determining a reasonable railroad rate.
GONDOLA: A railcar with a flat platform and slides 3 to 5 feet high used for top loading of items that are long and heavy.
GOODS: Cargo shipped by sea or air.
GOOSENECK: The front rails of the chassis that raise above the plane of the chassis and engage in the tunnel of a container.
GRACE, DAYS OF: A certain number of days allowed by law for payment of due bill.
GRANDFATHER CLAUSE: 1) Allows individual or company that has been doing business in a area to continue, despite new regulations that might ordinarily preclude operation. 2) Term used by ICC to grant authority to carrier to operate over routes where it or a predecessor was in bona fide operation at June 1, 1935.
granger laws: State laws passed before 1870 in mid-western states to control rail transportation.
Gray Market Imports: This term refers to imports bearing a genuine trademark but imported by a party other than the trademark holder or authorized importer.
Great Lakes carriers: Water carriers that operate on the five Great Lakes.
grid technique: A quantitative technique to determine the least-cost center, given raw materials sources and markers, for locating a plant or warehouse.
Gross National Product: A measure of a nation's output; the total value of all final goods and services a nation produces during a time period.
GROSS WEIGHT: 1) Entire weight of a shipment including containers and packaging material. 2) The combined weight of a container, its payload and any other loose internal fittings.
Group of ...: 5: Similar to the Group of Seven (G-7), with the exception of Canada and Italy. 7: This term refers to seven major economic powers (Canada. France, Germany, Great Britain, Italy, Japan, and the United States) whose finance ministers seek to promote balanced economic growth and stability among exchange rates. The leaders of these seven countries have met at annual economic summits since 1975 to coordinate economic policies. 10: Under the International Monetary Fund's General Agreements to Borrow (GAB), established in 1962, 10 of the wealthiest industrial members of the IMF "stand ready to lend their currencies to the IMF up to specified amounts when supplementary resources are needed." The finance ministers of these countries comprise the Group of 10 (also called the Paris Club). Members include: Belgium, Canada, France, Germany, Italy, Japan, Netherlands, Sweden, Switzerland, the United Kingdom, and the United States. Though numbering 11 with the addition of Switzerland in 1984, the numerical name persists. 11: The G-11 (also known as the Cartagena Group) was established in 1984 and comprises the largest debtor nations in Latin America: Argentina, Bolivia, Brazil, Chile, Colombia, Dominican Republic, Ecuador, Mexico, Peru, Uruguay, and Venezuela. 15: The G-15, established in 1990, consists of relatively prosperous or large developing countries. The G-15 discusses the benefits of mutual cooperation in improving their international economic positions. Members include: Algeria, Argentina, Brazil, Egypt, India, Indonesia, Jamaica, Malaysia (a very active member), Mexico, Nigeria, Peru, Senegal, Venezuela, Yugoslavia, and Zimbabwe. 24: A grouping of finance ministers from 24 developing country members of the International Monetary Fund. The Group, representing eight countries from each of the African, Asian, and Latin American country groupings in the Group of 77, was formed in January 1972 to counterbalance the influence of the Group of 10. 77: A grouping of developing countries which received its name in connection with 77 countries issuing a joint statement in Geneva, Switzerland in 1964. The G-77's primary focus is serving as a caucus for articulating members' collective interests primarily in areas of promoting economic cooperation among developing countries and in negotiations on economic matters with developing countries. G-77 membership has increased since 1964 to over 125 countries.
GROUP OF SEVEN: See G-7.
GSP: See GENERALIZED SYSTEM of PREFERENCE.
GST: Abbreviation for “Goods and Services Tax”. Specific to goods going into Canada.
GSA: General Sales Agent acting on behalf of an airline. Usually Broker or Forwarder.
GUARANTEED FREIGHT: Freight payable whether the goods are delivered or not, provided the failure to deliver the goods resulted from causes beyond the carrier's control.
guaranteed loans: Railroad loans that the federal government co-signs and guarantees
GW: Abbreviation for “Gross Weight”.
Hard Currency: The
currency of a nation which may be exchanged for that of another
nation without restriction. Sometimes referred to as convertible
currency. Hard currency countries typically have sizeable exchange
reserves and surpluses in their balance of payments.
Harmonized Code: An internationally accepted and uniform description system for classifying goods for customs, statistical and other purposes.
HARMONIZED COMMODITY DESCRIPTION AND CODING SYSTEM: A multipurpose international goods classification system designed to be used by manufacturers, transporters, exporters, importers, Customs, statisticians and others in classifying goods moving in international trade under a single commodity code. Developed under the auspices of the Customs Cooperation Council (CCC), an international Customs organization in Brussels. This code is a hierarchically structured product nomenclature containing approximately 5,000 headings and subheadings describing the articles moving in international trade. It is organized into 99 chapters arranged in 22 sections with the sections generally covering an industry (e.g., Section Xl, Textiles and Textile Articles) and the chapters covering the various materials and products of the industry (e.g., Chapter 50-Silk; Chapter 55-Manmade Staple Fibers; Chapter 57-Carpets). The basic code contains 4-digit headings and 6-digit subheadings. The USA has added digits for tariff and statistical purposes and duty rates are in the 8-digit level. Statistical suffixes are in the 10-digit level. This Harmonized System (HS) supplanted the U.S. Tariff Schedule (TSUSA) in January 1988.
Harmonized System: The Harmonized Commodity Description and Coding System (or Harmonized System, HS) is a system for classifying goods in international trade, developed under the auspices of the Customs Cooperation Council. Beginning on January 1, 1989, the new HS numbers replaced previously adhered-to schedules in over 50 countries, including the United States. For the United States, the HS numbers and four additional digits are the numbers that are entered on the actual export and import documents. Any other commodity code classification number (SITC, end-use, etc.) are just rearrangements and transformations of the original HS numbers.
HATCH: The cover of or opening in the deck of a vessel, through which cargo is loaded.
HAWB: House Air waybill issued by carrying airlines' agent, normally freight forwarder.
HAZARDOUS MATERIALS: Means a substance or material which has been determined by the U.S. Secretary of Transportation to be capable of posing an unreasonable risk to health, safety, and property when transported in commerce and which has been so designated. Title 49, Code of Federal Regulations (U.S.) Transportation: Parts 100199, govern the transportation of hazardous materials. Hazardous materials may be transported domestically, but they may be classified as Dangerous Goods when transported internationally by air. Also see RESTRICTED ARTICLES and DANGEROUS GOODS.
Heavy Lifts: Freight too heavy to be handled by regular ship's tackle.
Heavy Lift Vessel: Specifically designed to be self sustaining with heavy lift cranes, to handle unusually heavy and/or out-sized cargoes.
HIGH CUBE: Any container which exceeds 8’6” (102 inches) in height.
HIGHWAY CARRIERS: Divided into the following classes: Regular route (LINE HAUL) long haul/transcontinental carriers, regular route (LINE HAUL) short-haul carriers, irregular route carriers, specific commodity carriers, intrastate carriers, interstate carriers and local cartage/pickup/distribution carriers.
HOLD FOR PICKUP: Freight to be held at the carrier's destination location for pickup by the recipient.
House Air Waybill: An air waybill issued by a freight consolidator. See Air Waybill.
Hub: A central location to which traffic from many cities is directed and from which traffic is fed to other areas.
HUB AND SPOKE ROUTING: Aircraft routing service pattern that feeds traffic from many cities into a central hub designed to connect with other flights to final destinations. The system maximizes operating flexibility by connecting many markets through a central hub with fewer flights than would be required to connect each pair of cities in an extensive system.
HUNDREDWEIGHT: The pricing unit used in transportation. A hundredweight is equal to 100 pounds or 112 pounds avoirdupois. Abbreviated as CWT.
HUNDREDWEIGHT PRICING: Special pricing for multiple-piece shipments traveling to one destination which are rated on the total weight of the shipment (usually over 100 pounds) as opposed to rating on a per package basis.
Husbanding: Term used by steamship lines, agents, or port captains who are appointed to handle all matters in assisting the master of the vessel while in port to obtain bunkering, fresh water, food and supplies, payroll for the crew, doctors appointments, ship repair, etc.
IAOPA: See International
Aircraft Owner and Pilot Associations.
IATA: See INTERNATIONAL AIR TRANSPORT ASSOCIATION.
IATA Designator: Two-character Airline identification assigned by IATA in accordance with provisions of Resolution 762. It is for use in reservations, timetables, tickets, tariffs as well as air waybill.
iatan: see International Airlines Travel Agent Network.
IBID: Latin term meaning “in the same place”.
icc –See MOTOR CARRIER ACT OF 1935. Also abbreviation for “International Chamber of Commerce”
Ice Clause: An ice clause is a standard clause in the chartering of ocean vessels. It dictates the course a vessel master may take if the ship is prevented from entering the loading or discharge port because of ice, or if the vessel is threatened by ice while in the port. The clause establishes rights and obligations of both vessel owner and charterer if these events occur.
ICTF: Abbreviation for “Intermodal Container Transfer Facility” An on-dock facility for moving containers from ship to rail or truck.
IFF: Abbreviation for the “Institute of Freight Forwarders”.
Igloo: Container designed to occupy full main deck width of carrying aircraft.
Image processing: Allows a company to take electronic photographs of documents. The electronic photograph then can be stored in a computer and retrieved from computer storage to replicate the document on a printer. The thousands of bytes of data composing a single document are encoded in an optical disk. Many carriers now use image processing to provide proof-of-delivery documents to a shipper. The consignee signs an electronic pad that automatically digitizes a consignee's signature for downloading into a computer. A copy of that signature then can be produced to demonstrate that a delivery took place.
IMMEDIATE DELIVERY: A procedure allowing more rapid release to importers of imports flown into the USA each year. Under the “Immediate Delivery Program”, an importer can take delivery almost immediately of virtually all of an incoming shipment while Customs retains a sample for the purposes of appraisal. On the basis of this appraisal, the importer is billed later for the payment of duties.
Import Certificate: The import certificate is a means by which the government of the country of ultimate destination exercises legal control over the internal channeling of the commodities covered by the import certificate.
IMPORT LICENSE: A certificate, issued by countries exercising import controls, that permits importation of the articles stated in the license. The issuance of such a permit frequently is connected with the release of foreign exchange needed to pay for the shipment for which the import license has been requested.
Import Quota: A means of restricting imports by the issuance of licenses to importers, assigning each a quota, after determination of the total amount of any commodity which is to be imported during a period. Import licenses may also specify the country from which the importer must purchase the goods.
Import Quota Auctioning: The process of auctioning the right to import specified quantities of quota-restricted goods.
Import RESTRICTIONS: Import restriction, applied by a country with an adverse trade balance (or for other reasons), reflect a desire to control the volume of goods coming into the country from other countries may include the imposition of tariffs or import quotas, restrictions on the amount of foreign currency available to cover imports, a requirement for import deposits, the imposition of import surcharges, or the prohibition of various categories of imports.
IMPORT SERVICE: See EXPORT SERVICE.
Importer of Record: The U.S. Customs Service defines the importer of record as the owner or purchaser of the goods; or, when designated by the owner, purchaser, or consignee, a licensed Customs broker.
Imports for Consumption: "Imports for Consumption" measure the total of merchandise that has physically cleared through U.S. Customs either entering consumption channels immediately or entering after withdrawal for consumption from bonded warehouses under Customs custody or from Foreign Trade Zones. Many countries use the term "special imports" to designate statistics compiled on this basis.
IN BOND: As applied to freight coming into the USA, the term “In Bond” designates a procedure under which US Customs clearance of cargo is postponed until the cargo reaches an inland Customs point rather than subjecting the cargo to clearance procedures at the first arriving United States gateway port where the process might be more time consuming. The procedure is so named because the cargo moves under the carriers bond (financial liability assured by the carrier) from the gateway port and remains “In Bond” until Customs releases the cargo at the inland Customs point.
IN TRANSIT: Load proceeding along route between home terminal and destination point.
Inbound logistics: Covers: Determining most efficient routing and scheduling, Time-scheduled component parts pickup, Satellite tracking of shipment movements, Bar code verification at pick-up points, Supplier coordination, Material management, Returnable container control.
INCENTIVE RATE: A rate designed to induce the shipper to ship greater or heavier volumes per shipment.
INCOTERMS: Maintained by the International Chamber of Commerce (ICC). This codification of terms is used in foreign trade contracts to define which parties incur the costs and at what specific point the costs are incurred. Maintained by the International Chamber of Commerce.
Incremental Cost to Export: The additional costs incurred while manufacturing and preparing a product for export ( e.g., product modifications, special export packaging and export administration costs.) This does not include the costs to manufacture a standard domestic product, export crating and transportation to the foreign market.
INDEMNIFY: To compensate or repay for a loss sustained.
Independent Action: A move by whereby a member of a shipping conference elect to depart from the specific service rates set forth by the conference, giving ten calendar days notice of such action. The conference member's new schedule of rate, or rates, officially takes effect no later than ten days after receipt of notice by the conference.
INDIRECT AIR CARRIER: See AIR FREIGHT FORWARDER.
Indirect Offset: Involves goods and services unrelated to the aerospace/defense material being sold. See also OFFSET.
Individual Validated License: An IVL is written approval by which the U.S. Department of Commerce grants permission, which is valid for 2 years, for the export of a specified quantity of products or technical data to a single recipient. IVLs also are required, under certain circumstances, as authorization for the re-export of U.S.-origin commodities to new destinations abroad.
Inducement: Some steamship lines publish in their schedules the name of a port and the words by inducement in parentheses. This means the vessel will call at the port if there is sufficient amount of profitable cargo available and booked.
INFLATABLE DUNNAGE: Flexible bags usually made from vinyl material which can be inflated within the void spaces of a container/trailer to prevent the movement of cargo.
Infopartnering: An efficient consumer response enabler where retailers, wholesales and manufacturers develop partnerships based on shared "actionable information" and real-time communications links.
INFORMAL ENTRY: A simplified import entry procedure accepted at the option of Customs for any noncommercial shipment (baggage) and any commercial shipment not over $1,000 in value.
Inherent Vice: An insurance term referring to any defect or other characteristics of a product which could result in damage to the product without external cause. Insurance policies may specifically exclude losses caused by inherent vice.
Inland Bill of Lading: A bill of lading used in transporting goods overland to the exporter's international carrier. Although a through bill of lading can sometimes be used, it is usually necessary to prepare both an inland bill of lading and an ocean bill of lading for export shipments.
INLAND CARRIER: A transportation line which hauls exports or import traffic between ports and inland points.
Inspection Certificate: A document certifying that merchandise (such as perishable goods) was in goods condition immediately prior to shipment.
Insourcing: The opposite of outsourcing, that is, a service performed in-house.
INSURANCE: Contractual relationship which exists when one party, for a consideration, agrees to reimburse another from loss caused by designated contingencies. The first party is the insurer; the second is the insured; the contract is the Insurance Policy, the consideration is the premium, the property in question is risk and the contingency in question is the hazard or the peril.
Insurance Certificate: This certificate is used to assure the consignee that insurance is provided to cover loss of or damage to the cargo while in transit.
INSURANCE RIDER: Additional clause amending or supplementing the insurance policy.
INTEGRATED CARGO SERVICE: A blend of segments of the cargo system providing the combined services of air carrier, forwarder, ground handling and agents.
Integrated Carriers: Carriers that have both air and ground fleets; or other combinations, such as sea, rail, and truck. Since they usually handle thousands of small parcels an hour, they are less expensive and offer more diverse services than regular carriers.
Integrated Logistics: A system-wide management view of the entire supply chain, from raw materials supply through finished goods distribution. It requires managing all functions that make up the supply chain as a single entity, rather than managing individual functions separately.
Integrated operator: A service that controls the total process of moving cargo from pickup to delivery. The rationale is that tighter scheduling and total control lead to better service. Integrated operators usually fly their own cargo planes.
Integrated Tariff of the European Community: TARIC is a publication which presents the regulations pertaining to import of products into the EC as well as for some exports. TARIC adopts the provisions of Community legislation, the harmonized system, and the combined nomenclature (CN).
INTEGRATED TOW BARGE: A series of barges that are connected together to operate as one unit.
Intellectual Property: Ownership of the legal rights to possess, use or dispose of products created by human ingenuity, including patents, trademarks and copyrights.
INTER ALIA: Latin phrase meaning “amongst other things”.
INTERCHANGE: Process of passing freight from one carrier to another between lines.
INTERCOASTAL CARRIER: Vessels that transport freight between the east coast and west coast ports usually by way of the Panama Canal.
INTERLINE: The movement of a shipment via two or more carriers or transportation lines. See COORDINATED MOVEMENT
INTERLINE FREIGHT: Freight moving from origin to destination over lines of two or more transportation lines.
Intermeddle: Referring to the capacity to go from ship to train to truck, or the like. The adjective generally refers to containerized shipping or the capacity to handle same.
Intermediate Consignee: An intermediate consignee is the bank, forwarding agent, or other intermediary (if any) that acts in a foreign country as an agent for the exporter, the purchaser, or the ultimate consignee, for the purpose of effecting delivery of the export to the ultimate consignee.
Intermediate Container Transfer Facility: ICTF is a site where cargo is transferred from one form of transit to another, such as rail to ship.
Intermodal: Two or more modes of transport used in the continuous movement of goods from origin to destination. It applies to goods transported within containers or trailers, most often to join rail/truck moves. But marine and air modes can also be involved.
INTERMODAL COMPATIBILITY: The capability which enables a shipment to be transferred from one form of transport to another, as from airplane to highway truck, to railway freight car, to ocean vessel. Some aircraft in service today have the capability for intermodal exchange of the large types of standard containers currently used in surface transport.
Intermodal transportation: Using more than one mode to deliver shipments. For example: The movement of trailers-container by rail and at least one other mode of transportation.
INTERNAL WATER CARRIERS: Vessels that operate over the internal navigable rivers such as the Mississippi, Ohio and Missouri.
INTERNATIONAL AIR TRANSPORT ASSOCIATION (IATA): The trade and service organization for airlines of more than 100 countries serving international routes. IATA activities on behalf of shippers in international air freight include development of containerization programs, freight handling techniques and, for some airlines, uniform rates and rules. For information: P.O. Box 800, Victoria Place, Montreal, Quebec, Canada, 1M1 H4Z. Also see CNS.
International Aircraft Owner and Pilot Associations (IAOPA): A nonprofit federation of 37 autonomous, non-governmental, national general aviation organizations. IAOPA has represented international general aviation for more than 32 years.
International Airlines Travel Agent Network (IATAN): A not-for profit service organization whose main goal is to assist travel agents to meet and maintain a specific set of standards that are of value to airlines, the agency community as well as to consumers.
INTERNATIONAL CIVIL AVIATION ORGANIZATION (ICAO): An agency of the United Nations whose constitution is the “Convention on International Civil Aviation” drawn up by a conference in Chicago in November and December 1944, and to which each ICAO Contracting State is a party. It was organized to insure orderly worldwide technical development of civil aviation. For information: International Aviation Square, 1000 Sherbrooke Street West, Mail Box 400, Montreal, P0, Canada H3A 2R4.
International Court of Justice: The ICJ, established in 1945, is the principal judicial organ of the UN. The ICJ decides cases submitted to it by states and gives advisory opinions on legal questions submitted to it by the General Assembly or Security Council or by UN specialized agencies. The court is composed of 15 judges elected by the General Assembly and the Security Council from a list of persons nominated by the national groups in the Permanent Court of Arbitration. The seat of the Court is in The Hague, Netherlands.
International Federation of Freight Forwarders' Associations (FIATA): Founded in 1926 to protect and represent its members at international level. It’s members include 90 organizations and 1,920 associate members in 132 countries. For information: Baumackerstr. 24, POB 8050 Zürich, Switzerland.
International Management Code for the Safe Operation of Ships and for Pollution Prevention: See ISM CODE.
International Maritime Organization: The IMO was established as a specialized agency of the United Nations in 1948. The IMO facilitates cooperation on technical matters affecting merchant shipping and traffic, including improved maritime safety and prevention of marine pollution. Headquarters are in London, England.
International Standards Organization: The ISO, established in 1947, is a worldwide federation of national bodies, representing approximately 90 member countries. The scope of the International Standards Organization covers standardization in all fields except electrical and electronic engineering standards, which are the responsibility of the IEC, International Electrotechnical Commission. Together, the ISO and IEC form the specialized system for worldwide standardization: - the world's largest nongovernmental system for voluntary industrial and technical collaboration at the international level. The result of ISO technical work is published in the form of International Standards. There are, for example, ISO standards for the quality grading of steel; for testing the strength of woven textiles; for storage of citrus fruits; for magnetic codes on credit cards; for automobile safety belts; and for ensuring the quality and performance of such diverse products as surgical implants, ski bindings, wire ropes, and photographic lenses. International Standards Organization 9000-9004: ISO 9000 is the general name for the quality standard accepted throughout the European Economic Community. It was initially adopted in 1987. ISO is a series of documents on quality assurance published by the Geneva-based International Standards Organization. The five documents outline standards for developing Total Quality Management and a Quality Improvement Process. 9000 consists of guidelines for the selection and use of the quality systems contained in 9001-9003. 9001 outlines a model for quality assurance in design, development, production, installation, and servicing. 9002 outlines a model for quality assurance in production and installation. 9003 outlines model for quality assurance for final inspection and testing. 9004 is not a standard but contains guidelines for quality management and quality system elements.
International Trade Commission: An independent U.S. Government agency concerned with imports, import duties, and the effect of imports on U.S. industry. The Commission has six commissioners who review and make recommendations concerning countervailing duty and antidumping petitions submitted by U.S. industries seeking relief from imports that benefit unfair trade practices. Known as the U.S. Tariff Commission before its mandate was broadened by the Trade Act of 1974.
Interplant: Includes Bar code scanning for accurate inventory management, Consolidate/de-consolidate freight for time-sensitive delivery, Operate and manage warehouse/distribution centers, Plant-to-plan shuttle service, Cross-dock operations and Site selection.
INTERSTATE: Literally means between states. Applies to transportation of goods/persons from point in one state to point in another; between point in same state but passing within/through another state en-route or between points in the USA and foreign countries.
INTERSTATE COMMERCE: Business of exchanging goods between buyers and sellers of two or more states.
Interstate Commerce Commission (ICC): See MOTOR CARRIER ACT OF 1935.
INTRA: Latin term meaning “within”.
INTRASTATE COMMERCE: When all business between buyer and seller is carried on within one state.
Inventory velocity: The speed with which products move from receiving dock to shipping dock.
IPA: Abbreviation for “Including Particular Average”
IRREGULAR ROUTE CARRIER: A motor carrier that is permitted to provide service using any route.
IRREVOCABLE LETTER OF CREDIT: A Letter of Credit in which the specified payment is guaranteed by the bank if all terms and conditions are met by the drawee. The opposite is a Revocable Letter of Credit which can be cancelled or altered by the drawee or buyer after it has been issued by the drawee’s bank. It is as good as the issuing bank.
IRRITATING MATERIAL: As defined in the HAZARDOUS MATERIAL REGULATIONS in 49 CFR, liquid or solid substance which, upon contact with fire or when exposed to air gives off dangerous or intensely irritating fumes. Does not include any material classed as Poison A.
ISM Code: The ISM Code (International Management Code for the Safe Operation of Ships and for Pollution Prevention) become international law on July 1, 1998 for certain categories of vessels: Passenger ships, oil tankers, chemical tankers, gas carriers, bulk carriers and high speed cargo craft of 500 gross tonnage and over. Other cargo vessels and mobile offshore drilling units of 500 gross tonnage and over will be required to comply with the ISM Code by July 1, 2002.
ISO: The International Organization for Standardization (ISO) is a worldwide federation founded in 1946 to promote the development of international manufacturing, trade and communication standards. ISO is composed of member bodies from more than 90 countries. The American National Standards Institute (ANSI) is the United States' representative to ISO. ISO develops standards in all industries except those related to electrical and electronic engineering. Standards in these areas are made by the Geneva-based International Electrotechnical Commission (IEC) which has representatives from more than 40 member countries including the USA.
ISO 9000: A set of generic standards that provide quality assurance requirements and quality management guidance. They include a broad range of quality system elements. The basic ISO 9000 series comprises five standards: ISO 9000, ISO 9001, ISO 9002, ISO 9003, and ISO 9004. The standards are of two types: Guidance and Conformance. ISO 9000 and ISO 9004 are guidance standards. That is, they are descriptive documents, not prescriptive requirements. Companies do not register to either ISO 9000 or ISO 9004. Instead, they register to one of the conformance standards, ISO 9001, ISO 9002 or ISO 9003. These are models for quality systems.
ISP: Abbreviation for “Internet Service Provider”.
J&WO: Abbreviation for
“Jettison and Washing Overboard”.
JETSAM: Goods from a ship's cargo, or parts of its equipment, that have been thrown overboard to lighten the load in time of danger, or to set a stranded ship adrift.
JIT (JUST IN TIME): The principle of production and inventory control that prescribes precise controls for the movement of raw materials, component parts, and work-in-progress. Goods arrive when needed (just in time) for production or use rather than becoming expensive inventory that occupies costly warehouse space. JIT is an umbrella term including the elements of both KANBAN and MRP II systems.
JIT II (JUST IN TIME II): Vendor-managed operations taking place within a customer's facility. JIT II was popularized by the Bose Corporation.
joint cost: A common cost in cases where a company produces products in fixed proportions and the cost the company incurs to produce one product entails producing another; the backhaul is an example.
JOINT RATE: Agreed upon by two or more carriers, published in a single tariff, and applying between point on line of one and point on line of another. May include one or more intermediate carriers in route.
JOINT VENTURE: An international business collaboration between foreign interests and private parties in which two or more parties establish a new business enterprise to which each contributes and in which ownership and control are shared.
KANBAN: Japanese word
translated as “visible record” for manufacturing control systems in
which suppliers deliver needed parts to the assembly line “just in
time” for use. E.g. parts are not stocked. Affects purchasing,
material management, inventory control and production management.
Papercards are used for record keeping/control. Pronounced “conbon”,
this term is primarily associated with Toyota but has become a
generic term in the USA.
KD Flat: An article taken apart, folded, or telescoped to reduce its bulk at least 66 2/3% below its assembled size.
KDCL: Abbreviation for “Knocked down in carload lots”
KDLCL: Abbreviation for “Knocked down in less than carload lots”.
KEIRETSU: Refers to the horizontally and vertically linked industrial structure of post-war Japan. The horizontally linked groups include a broad range of industries linked via banks and general trading firms.
KICKBACK: Rebate usually given to person who is in position to purchase or order transportation for his/her company. See also REBATE.
KITTING: The process by which individual items are grouped or packaged together to create a special single item.
Knock Down: An article taken apart, folded or telescoped in such a manner as to reduce its bulk at least 33 1/3% below its assembled bulk.
KNOT: Equivalent to one nautical mile (6,080.20 feet) per hour or 1.85 kilometers per hour.
L&D: See LOSS AND
L/C: See Letter of Credit.
LADING: The cargo carried in a transportation vehicle.
Lagan: Cargo or equipment to which an identifying marker or buoy is fastened, thrown over-board in time of danger to lighten a ship's load. Under maritime law if the goods are later found they must be returned to the owner whose marker is attached; the owner must make a salvage payment.
LAN: Abbreviation for “Local Area Network”
LAND BRIDGE: Intermodal system of getting international cargo across intervening continent from one seacoast to another by special through trains.
land grants: Grants of land given to railroads to build tracks during their development stage.
LANDED COST: Total expense of receiving merchandise/goods at place of retail sale including retail purchase price and transportation charge.
LANDING GEAR: Device that supports at the end of semi-trailer when not attached to the tractor.
LASH: Lighter-Aboard-Ships vessels that carry barges. Designed to load internally, barges specifically designed for the vessel. The concept is to quickly float the barges to the vessel (using tugs or ships wenches) load these barges through the rear of the vessel, then sails. Upon arrival at the foreign port, the reverse happens; Barges are quickly floated away from the vessel and another set of waiting barges quickly are loaded. Designed for quick vessel turn-around. Usually crane-equipped; handles mostly breakbulk cargo. They are equipped with an overhead crane capable of lifting LASH barges and stowing them into cellular slots in athwartship position. See also SEA-BEE VESSEL.
Lash Vessel: Lay Days: The dates between which a chartered vessel is to be available in a port for loading of cargo.
LASHING: Rope/wire use to secure two objects together by binding.
LAST IN, FIRST OUT (LIFO): Accounting method of inventory valuation that assumes latest goods purchased are first goods used during the accounting period. Opposite of FIFO.
LAY ORDER: The period during which the imported merchandise may remain at the place of unlading without some action being taken for its disposition, i.e. Beyond the 5-day General Order period.
LAY TIME: Period of time in which the ship is loaded/discharged and for which no demurrage is charged.
LAZARETTO: Quarantined area for fumigating goods that might be carrying insects/dangerous germs.
LCL: Maritime terms meaning “Less than container load” or railroad term meaning “less than carload” e.g. Weighing less than the amount necessary to apply a carload rate charged by railroads for transportation.
LD3: Lower deck type 3 container. This is the most commonly used container in passenger aircraft.
LDI: See logistics data interchange
LDP: Abbreviation for “Landed Duty Paid”.
LEAD TIME: The total elapse time between order placement and order receipt. Includes time required for order transmittal, order processing and preparation as well as the time in transit.
LEGAL WEIGHT: 1) Weight of goods sold and interior packing but not the container’s weight (term commonly used in foreign trade). 2) A maximum weight limitation for a total highway unit as established by the highway authorities which, if exceeded, may subject the carrier to a fine or impounding of the vehicle.
LENGTH & GIRTH: Some carriers may apply this limitation on shipments. The equation used to calculate length and girth: Length + (2 x width) + (2 x height). The largest measurement will always be used as the length in the equation.
Less Developed Country: An LDC is a country with low per capita gross national product. Terms such as third world, poor, developing nations, and underdeveloped have also been used to describe less developed countries.
Lesser Developed Countries: The classification LLDC (sometimes also known as "Least" Developed Countries) was developed by the United Nations to give some guidance to donor agencies and countries about an equitable allocation of foreign assistance. The criteria for designating a country an LLDC, originally adopted by the UN Committee for Development Planning in 1971, have been modified several times. Criteria have included low: per-capita-income, literacy, and manufacturing share of the country's total gross domestic product. There is continuing concern that the criteria should be more robust and less subject to the possibility of easy fluctuation of a country between less developed and least developed status.
LESSEE: Individual, party or company with legal possession/control of vehicle (with/without driver) or other equipment from another party under the terms of a lease agreement.
LESSOR: Individual, party or company granting legal use of vehicle (with/without driver) or other equipment to another party under the terms of a lease agreement.
Letter of Credit: A financial document issued by a bank at the request of the consignee guaranteeing payment to the shipper for cargo if certain terms and conditions are fulfilled. Normally it contains a brief description of the goods, documents required, a shipping date, and an expiration date after which payment will no longer be made. An Irrevocable Letter of Credit is one which obligates the issuing bank to pay the exporter when all terms and conditions of the letter of credit have been met. None of the terms and conditions may be changed without the consent of all parties to the letter of credit. A Revocable Letter of Credit is subject to possible recall or amendment at the option of the applicant, without the approval of the beneficiary. A Confirmed Letter of Credit is issued by a foreign bank with its validity confirmed by a U.S. bank. An exporter who requires a confirmed letter of credit from the buyer is assured payment from the U.S. bank in case the foreign buyer or bank defaults. A Documentary Letter of Credit is one for which the issuing bank stipulates that certain documents must accompany a draft. The documents assure the applicant (importer) that the merchandise has been shipped and that title to the goods has been transferred to the importer.
LETTER OF INDEMNITY: Issued by the shipper to the carrier to secure a clean Bill of Lading for damaged goods. Usually to protect the carrier and for the purpose of avoiding collection difficulties with bank. Also, when a bank refuses to accept a foul bill of lading, the shipper (so that there shall be nothing to prevent the questionable draft from being discounted, among other reasons) may obtain a clean bill of lading. To acquire this, the shipper signs a letter of indemnity, which is an inducement to obtain the clean bill of lading through the dock or mate's receipt, given on delivery of the goods to dock or ship, showed that the shipment was damaged or in bad condition. This acts as a form of guarantee whereby the shipper accords a claim settlement against a steamship by a bill of lading holder resulting from a clean bill being issued.
LICENSE: A general export license covers the exportation of goods that are not restricted under the terms of a validated export license. No formal application or written authorization is needed to ship exports under a general export license.
LIFO: See LAST IN, FIRST OUT.
LIFT-ON/LIFT-OFF (LOLO): Carriage of containers on decks or on flatcars of water vessels.
LIGHTER: Flat bottomed boat, usually moved by tugs but can also be steam-powered. Used to transfer freight between cars, piers and vessels.
LIGHTERAGE: The cost of loading or unloading a vessel by means of barges alongside.
line functions: The decision-making areas companies associate with daily operations. Logistics line functions include traffic management, inventory control, order processing, warehousing, and packaging.
LINER: Ocean vessel engaged in the carriage of general cargo (including passengers) along definite route on a fixed schedule. The word "liner" is derived from the term "line traffic" which denotes operation along definite routes on the basis of definite, fixed schedules; a liner thus is a vessel that engages in this kind of transportation, which generally involves the haulage of general cargo as distinct from bulk cargo.
LINEHAUL: Movement of freight between cities, usually more than 1,000 miles, not including pickup and delivery services.
liner servicE: International water carriers that ply fixed routes on published schedules.
Link: The transportation method a company uses to connect nodes (plants, warehouses) in a logistics system.
Liquidation: The finalization of a customs entry.
LIST: (Of ship), means to lean to one side due to shifting of cargo.
LivE: A situation in which the equipment operator stays with the trailer or boxcar while it is being loaded or unloaded.
Live Animal: Commodities classified by IATA referring live animals such as horse, cow, ... also known as Livestock.
LIVE AXLE: Axle driven by engine as compared to dead axle which only follows as pulled.
Livestock: Common farm animals.
Lkg & Bkg: Abbreviation for “Leakage and Breakage”.
LLOYD’S REGISTER: Yearly document issued by Lloyds of London that contains tonnage, age, build, character and condition of registered ships.
Lo/Lo: The acronym meaning "lift-on, lift-off," denoting the method by which cargo is loaded onto and discharged from an ocean vessel, which in this case is by the use of a crane.
LOAD DISPLACEMENT: Vessel’s load capacity according to structure displacement.
load factor: A measure of operating efficiency used by air carriers to determine a plane's utilized capacity percentage or the number of passengers divided by the total number of seats.
loading allowance: A reduced rate that carriers offer to shippers and/or consignees who load and/or unload LTL or AQ shipments.
LOADING LINE: Guide on ship indicating to what depth it has sunk with lading. Serves as a safety factor. See also PLIMSOLL LINE.
LOAN RECEIPT: Document signed by the Assured where he acknowledges receipt of money advanced by the insurance company as an interest-free loan (instead of payment of a loss) repayable to the insurance company only if the loss is recovered from a third party and then only to the extent of the recovery.
local rate: A rate published between two points served by one carrier.
local service carriers: A classification of air carriers that operate between less-populated areas and major population centers. These carriers feed passengers into the major cities to connect with trunk (major) carriers. Local service carriers are now classified as national carriers.
localized raw material: A raw material found only in certain locations.
locational determinant: The factors that determine a facility's location. For industrial facilities, the determinants include logistics.
Logbook: A daily record of the hours an interstate driver spends driving, off duty, sleeping in the berth, or on duty but not driving.
Logistics: 1) All of the activities involved in planning and carrying out the handling, storage and transport of goods and materials along the supply chain, including the recovery of used or waste materials. 2) The function that encompasses materials management and physical distribution. 3) The management of inventory in motion and at rest.
Logistics Channel: The network of supply chain participants engaged in storage, handling, transfer, transportation, and communications functions that contribute to the efficient flow of goods.
logistics data interchange: A computerized system that electronically transmits logistics information.
LOLO: See LIFT-ON/LIFT-OFF.
Long-Dated Forward: The long-dated forward is a foreign exchange contract whose maturity exceeds one year; a few have extended over ten years.
LONG TON: Equivalent to 2,240 pounds or 20 long hundredweight. Also called a GROSS TON.
LONGSHOREMAN: Person employed on wharves of port to load/unload vessels.
LOSS AND DAMAGE (L&D): Report usually applicable when loss or damage is discovered when shipment is delivered.
LOSS OF MARKET: A situation in which, for one reason or another, sound cargo is no longer wanted by the consignee when it arrives. This is a "business loss" not recoverable under a Marine Cargo Policy; e.g., Christmas trees arriving in January undamaged.
LOT LABELS: Labels attached to each piece of a multiple lot shipment for identification purposes.
lot size: The quantity of goods a company purchases or produces in anticipation of use or sale in the future.
Louvre Accord: The Louvre Accord (February 1987) attempted to stop the dollar's fall and stabilize currency relationships by introducing reference ranges among the G-7 currencies.
Lower Deck: The compartment below the Main Deck (also synonymous with lower hold and lower lobe).
LOWER DECK CONTAINERS: Air carrier owned containers specially designed as an integral part of the aircraft to fit in the cargo compartments (lower deck) of the wide body aircraft.
LTL: Abbreviation for “Less than Truckload”. This term refers to less than quantity of freight required to apply a truckload (TL) rate charged by motor carriers for transportation. Also, a shipment weighting less than the minimum weight needed to use the lower truckload rate.
LUFFING: Angular movement of a crane in vertical plane.
Lumping: The act of assisting a motor carrier owner-operator in the loading and unloading of property. Commonly used in the food industry.
LWR: Most commonly used type of pallet at lower deck of passenger aircraft and full cargo freighter.
M/R: See Mate's Receipt
M/T: Abbreviation for “Metric Ton” (2204 lbs.)
M/V or MV: Abbreviation for “Motor Vessel”
Maastricht Treaty: The Maastricht Treaty (named for the Dutch town in which the treaty was signed) is also known as the Treaty of European Union. The treaty creates a European Union by: (a) committing the 12 member states of the European Economic Community to both European Monetary Union (EMU) and political union; (b) introducing a single currency (European Currency Unit, ECU); (c) establishing a European System of Central Banks (ESCB); (d) creating a European Central Bank (ECB); and (e) broadening EEC integration by including both a common foreign and security policy (CFSP) and cooperation in justice and home affairs (CJHA). The treaty, negotiated in 1991 and signed in February 1992, entered into force on November 1, 1993. The Maastricht Treaty envisioned EMU being achieved in three stages: A first stage (encompassing treaty negotiations and lasting through January 1, 1994) concludes with ratification of treaty amendments needed to establish EMU, including participation by all 12 EEC member states in the Exchange Rate Mechanism; A second stage (January 1, 1994 through no later than January 1, 1999) involves establishment of the European Monetary Institute (EMI) to support development of a single currency (the ECU) and development of the ECB; A third stage (starting no later than January 1, 1999) involves irrevocable fixing of exchange rates and the debut of the ECB with transfer of powers necessary for administering economic and monetary union.
Main Deck: The deck on which the major portion of payload is carried, normally known as Upper Deck of an airplane. The full cargo freighter aircraft has it entire upper deck equipped for main deck type of containers/pallets while Combi aircraft uses it rear part of the upper deck for cargo loading. There is no upper deck or main deck type of container/pallet at passenger aircraft.
MAJOR CARRIER: A for-hire certified air carrier with annual operating revenues of $1 billion or more. Carrier usually operates between major traffic centers.
MANDAMUS: Writ issued by court requiring specific actions to be taken.
MANIFEST: 1) Document signed by Master of ship setting forth description/destination of goods shipped. 2) Listing of shipments in load by pro number, consignee, destination, weight, etc.
MARAD: A US government agency, while not actively involved in vessel operation, administers laws for maintenance of merchant marine for the purposes of defense and commerce.
MAQUILADORA: The maquiladora (or "in-bond" industry) program allows foreign manufacturers to ship components into Mexico duty-free for assembly and subsequent re-export. Industry established under the maquiladora program is Mexico's largest source of foreign revenue (following oil exports). In December 1989, the Mexican government liberalized the maquiladora program to make this a more attractive and dynamic sector of economy. As a result, maquiladora operations may import, duty and import license free, products not directly involved in production, but that support production, including computers and other administrative materials and transportation equipment.
MARINE REGISTRY: Listing vessels under then name of the nation whose flag it flies. Shipowners most often register under most favorable/lenient flags.
Manufacturing Resource Planning System: See MRP II
marginal cost: The cost to produce one additional unit of output; the change in total variable cost resulting from a one-unit change in output.
Marine Cargo Insurance: Broadly, insurance covering loss of, or damage to, goods at sea. Marine insurance typically compensates the owner of merchandise for losses in excess of those which can be legally recovered from the carrier that are sustained from fire, shipwreck, piracy, and various other causes. Three of the most common types of marine insurance coverage are "free of particular average" (FPA), "with average" (WA), and "All Risks Coverage."
MARITIME: Commerce/navigation at sea or in seaports.
MARITIME ADMINISTRATION: A US Agency that promotes the merchant marine, determines ocean ship routes and services equipment and awards maritime subsidies.
Mark: As used on containers in foreign trade, a symbol or initials shown together with the port of importation and the final destination, if different. Example: A.G. y Cia., Bogota via Barranquilla. Marks are registered at appropriate customs houses; they also appear on bills of lading and invoices. In domestic trade, it is common to mark containers with the name and address of the recipient, but this is rarely done in foreign trade.
Market Access: Market access refers to the openness of a national market to foreign products. Market access reflects a government's willingness to permit imports to compete relatively unimpeded with similar domestically produced goods.
Market Disruption: Market disruption refers to the situation which is created when a surge of imports in a given product line causes sales of domestically produced goods in a particular country to decline to an extent that the domestic producers and their employees suffer major economic hardship.
market dominance: The absence of effective competition for railroads from other carriers and modes for the traffic to which the rail rate applies. The Staggers Act stated that market dominance does not exist if the rate is below the revenue-to-variable-cost ratio of 160 percent in 1981 and 170 percent in 1983.
Marking: Every article of foreign origin, or its container, imported into the United States shall be permanently marked in a conspicuous place in a manner which would indicate to the ultimate purchaser the English name of the country of origin of the article.
MARKS: Letters, numbers or other symbols placed on outer surface of shipping containers or packages to facilitate identification and handling procedures. Examples are address labels, box specifications, caution, or directional warnings. See also CASE MARKS.
Marks of Origin: The physical markings on a product that indicate the country of origin where the article was produced. Customs rules require marks of origin of most countries.
Mass Customization: The flexibility to meet the demands of a customer base whose needs are diverse and/or changing.
MATE’S RECEIPT: Receipt of cargo by the vessel, signed by the mate (similar to Dock Receipt)
material index: The ratio of the sum of the localized raw material weights to the weight of the finished product.
materials handling: Short-distance movement of goods within a storage area.
materials management: The movements and storage functions associated with supplying goods to a firm.
materials planning: The materials management function that attempts to coordinate materials supply with materials demand.
Materials REQUIREMENT Planning: See MRP II.
matrix organization: An organizational structure that emphasizes the horizontal flow of authority; the company treats logistics as a project, with the logistics manager overseeing logistics costs but traditional departments controlling operations.
MAXIMUM CUBE: A level of cube utilization that closely approximates the stated cubic capacity of a container.
MAXIMUM GROSS WEIGHT: Weight of a container and its payload.
MD2: Commonly used container/pallet at Main Deck or Upper Deck. Non-Airplane Unit Load
measurement ton: The measurement ton (also known as the cargo ton or freight ton) is a space measurement, usually 40 cubic feet or one cubic meter. The cargo is assessed a certain rate for every 40 cubic feet or 1 cubic meter it occupies. Used in water transportation rate making
MEMORANDUM TARIFF: Publications, which contain rule and rate information extracted from official tariffs. Memorandum tariffs are published by many carriers and are available from these carriers upon request.
Merger: The combination of two or more carriers into one company that will own, manage and operate the properties that previously operated separately.
METRIC TON: Measure of weight equal to 1,000 kilograms or about 2,206.6 pounds. Symbol is “t”. Also called tonne. See TON.
MFN: See MOST-FAVORED-NATION STATUS.
MICROBRIGDE: Provides for intermodal transport of freight from inland city to seaport with through movement of container freight onto overseas ship.
micro-land bridge: An Intermodal movement in which the shipment is moved from a foreign country to the U.S. by water and then moved across the U.S. by railroad to an interior, non-port city, or vice versa for exports from a non-port city.
mileage allowance: An allowance, based upon distance that railroads give to shippers using private railcars.
mileage rate: A rate based upon the number of miles the commodity is shipped.
mini-land bridge: An Intermodal movement in which the shipment is moved from a foreign country to the U.S. by water and then moved across the U.S. by railroad to a destination that is a port city, or vice versa for exports from a U.S. port city.
MINIMUM CHARGE: The lowest rate applicable on each type of service no matter how small the shipment.
minimum weight: The shipment weight the carrier's tariff specifies as the minimum weight required to use the TL or CL rate; the rate discount volume.
MIS: Abbreviation for “Management Information System”.
mixed loads: The movement of both regulated and exempt commodities in the same vehicle at the same time.
MM: Abbreviation for “Mercantile marine”.
modal split: The relative use that companies make of transportation modes. The statistics include ton-miles, passenger-miles and revenue.
MORTGAGE: Conveyance of property, real or personal, to person called mortgagee to secure performance of some act such as payment of money to mortgagor which become void upon performance of act.
MOST-FAVORED-NATION STATUS: A provision of certain international agreements, including the General Agreement on Tariffs and Trade (GATT), which affords countries the right to have their goods treated no less favorably than the goods of any other country. For example, the GATT MFN clause gives each member the right to have customs duties levied upon its products at the lowest rate offered to any other member nation. This is no longer the best tariff structure available. All contracting parties undertake to apply such treatment to one another under Article I of GATT. When a country agrees to cut tariffs on a particular product imported from one country, the tariff reduction automatically applies to imports of this product from any other country eligible for most-favored nation treatment. This principle of nondiscriminatory treatment of imports appeared in numerous bilateral trade agreements prior to establishment of GATT. A country is under no obligation to extend MFN treatment to another country unless both are bilateral contracting parties of the General Agreement on Tariffs and Trade or MFN treatment is specified in a bilateral agreement.
MOTOR CARRIER ACT OF 1935: Act of Congress effective October 1, 1935; Part II of the Interstate Commerce Act brought motor common and contract carriers under the jurisdiction of the ICC, incorporated into Revised Interstate Commerce Act of 1978.
MOTOR CARRIER ACT OF 1980: Act of Congress that initiated deregulation of for-hire trucking.
MOTOR COMMON CARRIER: Entity holding itself out to general public to provide motor vehicle transportation for compensation over regular or irregular routes, or both.
MOU: Abbreviation for “Memorandum of Understanding”.
MRO items: Maintenance, repair, and operating items--office supplies, for example.
MRP II: Manufacturing Resource Planning System of manufacturing controls using computers, as in KANBAN. Systems affects purchasing, material management, inventory control and production management as well as peripheral activities. The older meaning of MRP was “Materials REQUIREMENT Planning” and the roman numeral “II” was added to flag the change.
MULE: 1) Small vehicle used for moving two-axle dollies. 2) Yard tractor or hostler.
MULTI-FIBER ARRANGEMENT: An international umbrella compact, authorized by GATT, that allows contracting parties to negotiate bilaterally quantitative restrictions on textile imports (which normally would be considered contrary to GATT provisions) to the extent the importing country considers them necessary to prevent market disruption. This agreement provides that such restrictions should not reduce imports to levels below those attained during the preceding year. Bilateral agreements usually allow for import growth tied to anticipated greater demand. The Uruguay Round Agreement on Textiles and Clothing contains an agreed schedule for the gradual phase-out of quotas established pursuant to the MFA over a ten-year transition period, after which textile and clothing trade will be fully integrated into the GATT and subject to the same disciplines as other sectors.
MULTIMODAL: Using more than one mode of transportation to move a load of goods. E.g. Truck, train, ship, etc. Usually for imported or exported goods.
multinational company: A company that both produces and markets products in different countries.
multiple-car rate: A railroad rate that is lower for shipping more than one carload at a time.
MW: Abbreviation for “Minimum weight factor”
NAFTA: See North
American Free Trade NAMED PERILS POLICY: Any marine policy limiting
coverage to perils specifically listed in the policy; opposed to All
Risks policy. See "ALL RISKS."
national carrier: A for-hire certificated air carrier that has annual operating revenues of $75 million to $1 billion. The carrier usually operates between major population centers and areas of lesser population. Also, a flag carrier owned or controlled by the state.
National Customs Brokers & Forwarders Association of America, Inc.: See NCBFAA.
National Industrial Traffic League: An association representing shippers' and receivers' interests in matters of transportation policy and regulation.
National Motor Bus Operators Organization: An industry association representing common and charter bus firms. Now known as the American Bus Association.
National Transportation Act of 198: Federal legislation that governs transport by air, commodity, pipeline, federally regulated motor vehicles, northern marine re-supply and rail. A major goal of the Act was to increase competition among transportation firms.
National Railroad Corporation: Also known as Amtrak, the corporation established by the Rail Passenger Service Act of 1970 to operate most of the United States' rail passenger service.
Nationalization: Public ownership, financing and operation of a business entity.
NATO: See North Atlantic Treaty Organization.
NCBFAA: The National Customs Brokers & Forwarders Association of America, Inc. A trade association representing the licensed customs brokers, international freight forwarders, international air cargo agents and NVOCCs located throughout the USA. For information: 1200 18th Street, Suite 901, Washington, DC 20036.
NEGLIGENCE: Failure to exercise degree of care as demanded by law.
NEM: Abbreviation for “Not Elsewhere Mentioned” (English)
NES: Abbreviation of “Not Elsewhere Specified”. This often appears in air freight tariffs. For example: "advertising matter, NES" or "printed matter, NES" indicating that the rate stated in the tariff applies to all commodities within the commodity group except those appearing under their own rate. The abbreviation NES, as used in air freight tariffs, is comparable to the abbreviation NOIBN. “Not Otherwise Indexed By Number) and NOS (Not Otherwise Specified) which appear in tariffs published by the surface modes.
Nested: Three or more different sizes of an article are placed within each other so that each article will not project above the next lower article by more than 33 1/3% of its height.
Nested Solid: Three of more different sizes of an article are placed within each other so that each article will not project above the next lower article by more than 1/4 inch.
NESTING: Fitting one article of cargo inside the other to economize on space.
NET: Figures/totals remaining after all charges/deductions have been subtracted.
NET TARE WEIGHT: The weight of an empty container plus any fixtures permanently attached.
Net Terms: Free of charters' commission
NET TON: 2,000 pounds.
NET TONNAGE: Gross tonnage minus deductions for space occupied by crew quarters, machinery for navigation, engine room and fuel.
NET TON-MILE: Movement of ton of freight one mile.
NET WEIGHT: 1) Weight of article without packing and container. 2) Weight of entire contents of vehicle.
NEUTRAL AIR WAYBILL: A standard air waybill without identification of the issuing carrier. Also called a UNIVERSAL AIR WAYBILL.
Newly Independent States: The NIS is a collective reference to 12 republics of the former Soviet Union: Russia, Ukraine, Belarus (formerly Byelorussia), Moldova (formerly Moldavia), Armenia, Azerbaijan, Uzbekistan, Turkmenistan, Tajikistan, Kazakhstan, and Kirgizstan (formerly Kirghiziya) and Georgia. Following dissolution of the Soviet Union, the distinction between the NIS and the Commonwealth of Independent States (CIS) was that Georgia was not a member of the CIS. That distinction dissolved when Georgia joined the CIS in November 1993.
Newly Industrializing Countries: The term, originated by the Organization for Economic Cooperation and Development (OECD), describes nations of the Third World that have enjoyed rapid economic growth and can be described as "middle-income" countries (such as Singapore and the Republic of Korea).
Newly Industrializing Economies: NIE's is a term generally applied to the more advanced developing countries in East Asia. The reference includes Hong Kong, Korea, Singapore, and Taiwan; occasionally its use encompasses other countries as well, such as Indonesia and Thailand.
NFO: Abbreviation for “Next Flight Out”
NMFC: Abbreviation for “National Motor Freight Classification”.
no location: A received item for which the warehouse has no previously established storage slot.
No Objection Certificate: Document provided by scheduled or national airlines of many countries declaring no objection to a proposed charter flight operated by another airline. Often demanded by government authorities before they grant permission for a charter flight to take place.
No Objection Fee: Sum of money paid by a charter airline normally to a scheduled airline in order that it waives its right of objection to its government, thus allowing a charter to take place. Tantamount to a bribe. The amount is usually a fixed percentage of the gross cost of a charter. Common practice in the Middle East and Africa.
NODE: A fixed point in a company’s logistics system where goods come to rest: plants, warehouses, supply sources, market destinations, etc.
NOE: Abbreviation for “Not otherwise enumerated”.
NOI: Abbreviation for “Not Otherwise Indexed”.
NOHP: Abbreviation for “Not otherwise herein provided”.
NOI: Abbreviation for “Not more specifically described
NOIBN: Abbreviation for “Not otherwise indicated by number” or “Not otherwise indicated by name”.
Non-asset provider: A logistics company with no ties to a transportation or warehouse firm.
NON-CONFERENCE: Independent steamship lines that cannot provide the schedules or direct service that conference lines can.
NON-DOCUMENT SURCHARGE: Surcharges on exported commodities classified as dutiable in the foreign destination.
NONSTRUCTURAL CONTAINER: An ULD composed of a bottomless rigid shell used in combination with a pallet and net assembly. NOTE: The expression "Nonstructural Container" is also used to refer to the shell part of a device.
Non-Tariff Barriers: Market access barriers that result from prohibitions, restrictions, conditions or specific requirements and make exporting products difficult and/or costly. The term covers any restriction or quota, charge, or policy, other than traditional customs duties, domestic support programs, discriminatory labeling and health standards, and exclusive business practices which limit the access of imported goods. May result from government or private sector actions.
NON-VESSEL OPERATING COMMON CARRIER (NVOCC): A company that consolidates small shipments from different sources consigned to the same destination into a single container for shipment overseas by either air or ocean carrier. An FMC registered cargo consolidator of small shipments in ocean trade, generally soliciting business and arranging for or performing containerization functions at the port. These carriers issue their own bill of lading referred to as a house bill of lading.
North American Free Trade Agreement: NAFTA, which entered into force in January 1994, is a free trade agreement comprising Canada, the United States and Mexico. NAFTA exceeds 360 million consumers and a combined output of $6 trillion: -approximately 20 percent larger than the European Community. NAFTA's consumer population is slightly smaller than the European Economic Area which has over 380 million consumers. The Agreement: Progressively eliminates almost all U.S.-Mexico tariffs over a 10-year period, with a small number of tariffs for trade-sensitive industries phased out over a 15-year period. Mexico-Canada tariffs are also phased out over a 10-year period. Tariff reduction schedules between the United States and Canada negotiated in the Canadian Free Trade Agreement are retained. Eliminates other barriers to trade such as import licensing requirements and Customs user fees. Establishes the principle of national treatment, for ensuring that NAFTA-origin products trade between NAFTA countries will receive treatment equal to similar domestic products. Guarantees service providers of the three countries equal treatment in the NAFTA area, including the right to invest and the right to sell services across borders. Establishes five basic principles to protect foreign investors and their investment in the free trade area: (a) nondiscriminatory treatment, (b) freedom from performance requirements, (c) free transference of funds related to an investment, (d) expropriation only in conformity with international law, and (e) the right to seek international arbitration f or a violation of the agreement's protections. The Agreement contains special provisions for sensitive economic sectors, including agriculture, automotive products, energy, and textiles and apparel. The Agreement also created a Border Environment Cooperation Commission and a North American Development Bank.
North Atlantic Treaty Organization: NATO members include Belgium, Canada, Denmark, France (which has only partial membership), Greece, Iceland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Turkey, United Kingdom, United States, and Germany. With the end of the "cold war," NATO's role, originally defense-oriented is being redefined.
NOS: Abbreviation for “Not Otherwise Specified”. See NES. Abbreviation indicating an article in general class in consolidating freight classification.
NOSE: Front of a container.
NOTICE OF ARRIVAL: See ARRIVAL NOTICE.
NT: Abbreviation for “Net tons”.
NVOCC: See NON-VESSEL OPERATING COMMON CARRIER.
O/A: See OPEN ACCOUNT.
O/N: Abbreviation for “Order notify; own name”
O/o: Abbreviation for “Order of”
O/R: Abbreviation for “Owner's risk”
O&R: Abbreviation for “Ocean and Rail”.
OA: Abbreviation for “Office Automation”.
OBC: On Board Courier.
Ocean Bill of Lading: A receipt for the cargo and a contract for transportation between a shipper and the ocean carrier. It may also be used as an instrument of ownership which can be bought, sold, or traded while the goods are in transit. To be used in this manner, it must be a negotiable "Order" Bill-of-Lading. A Clean Bill-of-Lading is issued when the shipment is received in good order. If damaged or a shortage is noted, a clean bill-of-lading will not be issued. An On Board Bill-of-Lading certifies that the cargo has been placed aboard the named vessel and is signed by the master of the vessel or his representative. On letter of credit transactions, an On Board Bill-of-Lading is usually necessary for the shipper to obtain payment from the bank. When all Bills-of-Lading are processed a ship's manifest is prepared by the steamship line. This summarizes all cargo aboard the vessel by port of loading and discharge. An Inland Bill-of-Lading (a waybill on rail or the "pro forma" bill-of-lading in trucking) is used to document the transportation of the goods between the port and the point of origin or destination. It should contain information such as marks, numbers, steamship line, and similar information to match with a dock receipt.
OCR: See OPTICAL CHARACTER RECOGNITION.
OD: Abbreviation for “Outside diameter”
ODS: An acronym commonly used for the term "Operating Differential Subsidy," which is a payment to an American-flag carrier by the federal government to offset the difference in operating costs between US and foreign vessels.
OEM: See Original Equipment Manufacturers
Off-Line: Describes an airline that sells in a market to which it does not operate. An Off-Line carrier will use another operator to link with its network.
OFF ROUTE POINTS: Points locate off regular route highways of linehaul carriers. Generally served only on irregular basis.
Offset: Compensatory, reciprocal trade agreements for industrial goods and services as a condition of military-related export sales and services. It is also used in the purchase of civilian aircraft and has become the norm in the aerospace/defense sector. Offset is divided into two categories, Indirect Offset and Direct Offset.
Offshore Banking Unit: An OBU is normally a foreign bank which conducts domestic money market, Eurocurrency, and foreign exchange settlements. OBUs cannot accept domestic deposits but their activities are unrestricted by domestic authorities. OBUs are located in major financial centers (known as offshore banking centers) with liberal reserve, tax, and capital market requirements.
Offshore Manufacturing: Offshore manufacturing is the foreign manufacture of goods by a domestic firm primarily for import into its home country.
ON THE BERTH: Term denoting that ship is ready to load/discharge cargo.
OPEN ACCOUNT (O/A): A trade arrangement in which goods are shipped to a foreign buyer without the guarantee of payment. Because this method poses an obvious risk to the supplier, it is essential that the buyer's integrity be unquestionable.
OPEN END LEASE: Lease guaranteeing that lessor will realize minimum value from sale of equipment at the end of the lease period.
OPEN INSURANCE POLICY: An insurance policy that applies to all shipments made over a period of time rather than to one shipment only.
OPEN POLICY: A cargo policy with no expiration date that provides automatic coverage of cargo to or from an Assured in a specified trade at agreed rates, terms, and conditions. Usually consists of separate Marine and War policies.
OPERATING AUTHORITY: Routes, points and types of traffic that may be served by carrier. Authority is granted by state or federal regulatory agencies.
OPERATING RATIOS: 1) Comparison of carrier’s operating expenses with gross receipts or income divided by expenses. 2) A measure of operating efficiency defined as Operating expenses divided by Operating revenues x 100 order cycle time. The time that elapses from placement of order until receipt of order. This includes time for order transmittal, processing, preparation, and shipping.
OPTICAL CHARACTER RECOGNITION (OCR): Reading of data scanning location or shape of data on a document.
OPTIMUM CUBE: The highest level of cube utilization that can be achieved when loading cargo into an ocean container.
ORB: Abbreviation for “Owner's risk or breakage”.
ORDER BILL OF LADING: Contains four distinguishing features: 1) Goods are consigned to order of the party named on the Bill of Lading. 2) Name and post office address of party to notify on arrival of the consignment at destination must always be written on the Bill of Lading. 3) Negotiable document most frequently used when shippers wish to collect for value of the shipment prior to making delivery and 4) Printed on yellow paper to make it readily distinguishable.
order picking: Assembling a customer's order from items in storage.
order processing: The activities associated with filling customer orders.
ordering cost: The cost of placing an inventory order with a supplier.
ORDet: Abbreviation for “Owner's risk of deterioration”
ORDINARY LIVESTOCK: Defined in the Interstate Commerce Act as “all cattle, swine, sheep, goats, horses and mules except as such as are chiefly valuable for breeding, racing, show purposes and other special uses”
Organization for International Standards: See ISO.
ORF: Abbreviation for “Owner's risk of fire or freezing”
Original Equipment Manufacturers: Customers who incorporate the exporter's product into their own merchandise for resale under their own brand names.
Orient Airlines Association: see Association of Asia Pacific AirlineS.
ORL: Abbreviation for “Owner's risk of leakage”
ORM (OTHER REGULATED MATERIAL): See HAZARDOUS MATERIALS and RESTRICTED ARTICLES.
ORW: Abbreviation for “Owner's risk of becoming wet”
OS&D: Abbreviation for “Over, Short and Damaged”. Normally a report used to file a claim with a carrier.
OSHA: The Occupational Safety and Health Administration.
out-of-pocket cost: The cost directly assignable to a particular unit of traffic and which a company would not have incurred if it had not performed the movement.
OUTAGE: Empty space in container/drum to accommodate natural expansion, density change etc due to temperature changes.
Outbound logistics: Includes to deliver product to retail stores, to return warranty and scrap product to distribution center, to computerized information management to provide real-time view of the entire operation, to contract warehousing.
Outsource: To hire a third-party provider.
Outsourcing: Subcontracting business functions or processes such as logistics and transportation services to an outside firm, instead of doing them in-house.
OVERAGE: Freight in excess over quantity believed to have been shipped, or more than quantity shown on the shipping document.
OVER, SHORT AND DAMAGED: See OS&D.
OVER THE COUNTER SMALL PACKAGE SERVICE: See SMALL PACKAGE SERVICE.
OVER THE ROAD: A motor carrier operation that reflects long distance, intercity moves. The opposite of local operations.
OVER PIVOT RATE - The rate per kilo to be charged for the Over Pivot weight.
OVER PIVOT WEIGHT: The weight in excess of the pivot weight.
OVERHEIGHT CARGO: Cargo stowed in an open-top container that projects above the uppermost level of the roof struts.
OWNER-OPERATOR: Driver who owns and operates his/her own truck. The owner-operator may be a common carrier or exempt carrier. Such contractor may lease his/her rig/driver to another carrier.
OWNER’S RISK: When the owner of goods remains responsible during shipping, relieving the carrier of part of the risk.
OXIDIZING MATERIAL: As defined in the HAZARDOUS MATERIAL REGULATIONS in 49 CFR. Any substance that yields oxygen readily to simulate combustion of organic matter.
PA: Abbreviation for
Pacific Rim: The Pacific Rim, referring to countries and economies bordering the Pacific ocean, is an informal, flexible term which generally has been regarded as a reference to East Asia, Canada, and the United States. At a minimum, the Pacific Rim includes Canada, Japan, the People's Republic of China, Taiwan, and the United States. It may also include Australia, Brunei, Cambodia, Hong Kong/Macau, Indonesia, Laos, North Korea, South Korea, Malaysia, New Zealand, the Pacific Islands, the Philippines, Russia (or the Commonwealth of Independent States), Singapore, Thailand, and Vietnam. As an evolutionary term, usage sometimes includes Mexico, the countries of Central America, and the Pacific coast countries of South America.
PACKING: any container or covering in which the contents of a shipment is packed.
PACKING LIST: List showing merchandise packed and all particulars. Usually prepared by the shipper but not necessarily required by the carrier. A copy is usually sent to the consignee to assist in verifying shipment receipt.
Paid by Agent (PBA): See ADVANCEMENT OF CHARGES
Paired: Abbreviation for “Port of Arrival Immediate Release and Enforcement Determination”. A U.S. Customs program that allows entry documentation for an import shipment to be filed at one location, usually an inland city, while the merchandise is cleared by Customs at the port of entry, normally a seaport. May be ineffective with certain types of high-risk cargoes, such as quota-regulated textiles or shipments from drug-production regions. Cities where there is a natural flow of cargo are actually "paired" in the program; e.g., Atlanta, an inland city, is linked with Savannah, a seaport. Tested in '87-'88, it became generally available in mid- '88.
PALLET: 1) A platform with a flat metal framed undersurface on which goods are assembled and secured by nets and straps. See Aircraft Pallet. 2) Load board with two decks separated by bearers or single deck supported by bearers constructed for transport/stacking and with overall height reduced to minimum compatible with handling by forklift/pallet trucks. 3) Platform used for utilizing loads for storage/shipping. The standard pallet is 48 x 40 x 5 ½ inches and usually made of wood.
Pallet Extender: Fashionable metal or cardboard device to increase pallet capacity.
PALLET LOADER: A device employing one or more vertical lift platforms for the mechanical loading or unloading of palletized freight at planeside.
PALLET TRANSPORTER: A vehicle for the movement of loaded pallets between the aircraft and the freight terminal or truck dock. Sometimes the functions of both the pallet loader and pallet transporter are combined into a single vehicle.
pallet wrapping machine: A machine that wraps a pallet's contents in stretch-wrap to ensure safe shipment.
PALLETIZATION: System for shipping goods on comparatively lightweight double-decked wooden platforms called PALLETS. Permits shipment of multiple units as one large unit.
Paperless Release: Under ABI, certain commodities from low-risk countries not designated for examination may be released through an ABI-certified broker without the actual submission of documentation.
PARCEL POST AIR FREIGHT: An airline service through which a shipper can consolidate a number of parcel post packages (with destination postage affixed by the shipper) for shipment as air freight to the postmaster at another city for subsequent delivery within local postal zones or beyond.
Part Charter: Where part of an airline's scheduled flight is sold as if it were a charter in its own right (Often wrongly used as a synonym for split charter).
Part Load Charter: Where a part of an aircraft's load is discharged at one destination and a part of it at another. This is distinct from a split charter where a number of consignments are carried to the same destination. Inbound, part loads are treated as single entity charters under the regulations of most countries.
Particular Average: Partial loss or damage to goods.
passenger-mile: A measure of output for passenger transportation that reflects the number of passengers transported and the distance traveled; a multiplication of passengers hauled and distance traveled.
PAYLOAD: In freight transportation, means “profitable cargo”
PARTICIPATING CARRIER: A carrier participating in a tariff and who therefore applies that rates, charges, routings and regulations of the tariff.
PBA (Paid by Agent): See ADVANCEMENT OF CHARGES
peak demand: The time period during which customers demand the greatest quantity.
Pegging: A technique in which a DRP system traces demand for a product by date, quantity, and warehouse location.
PER: 1) Latin term meaning “by”. 2) “means of”. 3) “according to”.
PER DIEM: 1) Latin term meaning “by the day”. 2) Daily rate charged by rail carriers for use of railcars by any other rail carriers.
PERFORMANCE BOND: Bond executed in connection with contract securing performance/fulfillment of terms.
PERILS OF THE SEA: An insurance term used to designate heavy weather, grounding, stranding, collision, water damage or lightning, etc.
PERISHABLE FREIGHT: Commodities subject to a rapid deterioration or decay (fresh fruits and vegetables, dairy products, meats and fish etc.). These commodities require special protective services in transit like refrigeration, heating, ventilation, etc.
PERMITS: Authority granted by the ICC to contract carriers by motor vehicle or water and freight forwarders to operate in interstate commerce.
personal computer (PC): An individual unit an operator uses for creating and maintaining programs and files. Can often access the mainframe simultaneously.
personal discrimination: Charging different rates to shippers with similar transportation characteristics, or, charging similar rates to shippers with differing transportation characteristics.
Petrodollars: This term refers to oil earnings of petroleum-exporting countries in excess of their domestic needs and deposited in dollars in Western banks. However, a large part of the revenues that OPEC countries were unable to spend has been recycled to oil-importing countries in an attempt to balance international accounts.
PHYSICAL DISTRIBUTION: Broad range of activities involving efficient movement of goods from source of raw materials through production to consumer. Activities include warehousing, material handling, packaging, order processing, freight transportation and other related activities.
PHYTOSANITARY INSPECTION CERTIFICATE: A certificate, issued by the US Department of Agriculture to satisfy import regulations for foreign countries, indicating that a US shipment has been inspected and is free from harmful pests and plant diseases.
physical supply: The movement and storage of raw materials from supply sources to the manufacturing facility.
pick/pack: Picking and packing immediately into shipment containers.
picking by aisle: A method by which pickers pick all needed items in an aisle regardless of the items' ultimate destination; the items must be sorted later.
picking by source: A method in which pickers successively pick all items going to a particular destination regardless of the aisle in which each item is located.
PICKUP AND DELIVERY SERVICE (PU&D): An optional service for the surface transport of shipments from shipper's door to originating carrier’s terminal and from the carrier’s terminal of destination to receiver's door. Pickup service, at an additional charge, is provided upon shipper's request. In air transportation, delivery service is provided automatically by the air carrier, at an additional charge, unless the shipper requests otherwise. PU&D service is provided between all airports and all local points of such airports. For service beyond the terminal area, see TRUCK/AIR SERVICE.
PIER: The structure to which a vessel is secured for the purposes of loading and unloading cargo.
PIER-TO-HOUSE: Ocean carrier containerizes shipper’s cargo on the loading pier and delivers directly to the consignee’s premises.
PIER-TO-PIER: Ocean carrier containerizes shipper’s cargo on the loading pier and removes cargo from the container on the arriving pier.
PIGTAIL: Slang term for cable used to transmit electrical power to trailer.
PIGGYBACK: The point-to-point movement of one transportation vehicle upon another. A highway semi-trailer on a railroad flat car or trailer ferry, a van-container on board a ship or new passenger automobiles on auto-rack cars are all forms of piggyback transportation.
PILFERAGE: Taking the property of others. As used in marine insurance policies, the term denotes petty thievery, the taking of small parts of a shipment, as opposed to the theft of a whole shipment or large unit. Many ordinary marine insurance policies do not cover against pilferage, and when this coverage is desired, it must be added to the policy.
PILOT: Person whose duty is to steer ships, particularly along coasts or into/out of harbor.
pin lock: A hard piece of iron, formed to fit on a trailer's pin, that locks in place with a key to prevent an unauthorized person from moving the trailer.
PIVOT WEIGHT: Minimum chargeable ULD weight. That weight of a ULD above which a higher tariff applies; in effect, an incentive to maximize cargo density.
Place: A particular street address or other designation of a factory, store, warehouse, place of business, private residence, construction camp or the like, at a point.
Place of Rest: The term "Place of Rest" as used in the Containerized Cargo Rules means that location on the floor, dock, platform or doorway at the CFS to which cargo is first delivered by shipper or agent thereof.
PLACE UTILITY: A value created in a product by changing its location. Transportation creates place utility.
planned order: In DRP and MRP systems, a future order the system plans in response to forecasted demand.
PLIMSOLL LINE: Statutory load line on a vessel identifying displacement mark as to where a vessel may safely be loaded to. A horizontal line painted on the outside of the ship that must remain above the surface of the water.
POA: Power Of Attorney, an authorization granted by consignee or importer to its customs broker for the processing of customs clearance on its behalf.
POC: Abbreviation for “Point of Contact”
POD: See PROOF OF DELIVERY.
Point: A particular city, town, village or other community or area which is treated as a unit for the application of rates.
POINT OF ORIGIN: Station at which shipment is received from shipper by the carrier.
point of sale information: Price and quantity data from the retail location as sales transactions occur.
POISONS: As defined in the HAZARDOUS MATERIAL REGULATIONS in 49 CFR. These materials are further divided into two groups based on the degree of hazard posed in transportation. Poison A includes gases and liquids that are dangerous to life if only a small amount is mixed with air. Poison B includes substances, liquid and solid, which are known to be toxic to man.
police powers – The US's constitutionally granted right for the states to establish regulations to protect their citizens' health and welfare. Truck weight, speed, length, and height laws are examples.
POLITICAL RISK: In export financing, the risk of loss due to currency inconvertibility, foreign government action preventing the delivery of goods, revolution, war, expropriation, confiscation, etc.
POOL: A continuous supply of containers at a specific location to facilitate continuous volume loading.
POOLING AGREEMENT: Dividing of revenue/business amongst two or more carriers in accordance with previous contracts/agreements. Also an agreement among carriers to share the freight to be hauled or to share profits. The Interstate Commerce Act outlawed pooling agreements, but the Civil Aeronautics Board approved profit pooling agreements for air carriers during strikes.
PORT: 1) A harbor or haven where ships may anchor. 2) That side of the vessel on the left hand of a person who stands on board facing the bow (front) of the vessel.
PORT AUTHORITY: A state or local government that owns, operates or otherwise provides wharf, dock and other terminal investments in ports.
PORT CHARGES: Charges assessed for services performed at ports including lighterage, pilotage, towage, harbor dues, dockage and wharfage.
Port Marks: An identifying set of letters numbers and/or geometric symbols followed by the name of the port of destination, which are placed on export shipments. Foreign government requirements may be exceedingly strict in the matter of port marks.
Port of Discharge: Port where vessel is off loaded and cargo discharges.
PORT OF ENTRY: A port at which foreign goods are re-admitted into the receiving country . In the USA, any place designated by act of U.S. Congress, executive order of the President of the United States or order of the U.S. Secretary of the Treasury, at which a U.S. Customs officer is assigned with authority to accept entries of merchandise, to collect duties and to enforce the various provisions of the U.S. Customs laws.
Port of Loading: Port where cargo is loaded aboard the vessel lashed and stowed.
PORT-OF-ORIGIN AIR CARGO CLEARANCE: For the convenience of exporters moving goods by air from inland U.S. cities, certain U.S. Customs formalities can now be handled at the originating Airport City. This avoids delaying such procedures until the export reaches a gateway point sometimes hundreds of miles from the exporter's business.
possession utility: The value created by marketing's effort to increase the desire to possess a good or benefit from a service.
Power of Attorney: A document that authorizes a customs broker to sign all customs documents on behalf of an importer.
Pre-Advice: Preliminary advice that a letter of credit has been established in the form of a brief authenticated wire message. It is not an operative instrument and is usually followed by the actual letter of credit.
PREDATORY PRICING: Temporary pricing action by one company to point below variable costs that has the effect of removing competing company from market.
PREPAID CHARGES: Generally speaking, freight charges both in ocean and air transport may be either prepaid in the currency of the country of export or they may be billed collect for payment by the consignee in his local currency. However, on shipments to some countries freight charges must be prepaid because of foreign exchange regulations of the country of import and/or rules of steamship companies or airlines.
Pre-Slung Cargo: Cargo shipped already in a cargo sling or net. Usually prepared and loaded at pier ready for arrival of vessel and subsequent loading (i.e. coffee in bags, coconut shells, etc).
Price Quotation: An invoice prepared by the seller in advance of shipment that documents the cost of goods sold, freight, insurance, and other related charges. It is often used by the buyer to secure a letter of credit, an import license or a foreign currency allocation.
Prima Facie: Latin, "on first appearance." A term frequently encountered in foreign trade. When a steamship company issues a clean bill of lading, it acknowledges that the goods were received "in apparent good order and condition" and this is said by the courts to constitute prima facie evidence of the conditions of the containers; that is, if nothing to the contrary appears, it must be inferred that the cargo was in good condition when received by the carrier.
primary-business test: A test the ICC uses to determine if a trucking operation is bona fide private transportation. The private trucking operation must be incidental to and in the furtherance of the firm's primary business.
PRIORITY AIR FREIGHT: Reserved air freight or Air Express service wherein shipments have a priority after mail and the small package services. Any size or weight allowed within air freight service limits is acceptable. Advanced reservations are permitted for movement on a given flight and, in some cases, a partial refund is paid the shipper if the shipment is not moved on the flight specified.
PRIORITY LOGISTICS MANAGEMENT: The application of the JIT (Just-In-Time) transportation theory.
PRIVATE CARRIER: A carrier that provides transportation services to the company that owns or leases the vehicles and does not charge a fee. Private motor carriers may haul freight at a fee for their wholly owned subsidiaries.
private warehousing: The storage of goods in a warehouse owned by the company that has title to the goods.
PRO NUMBER: A progressive or serial number applied for identification purposes to freight bills, Bills of Lading, etc.
production planning: The decision-making area that determines when and where and in what quantity a manufacturer is to produce goods.
Productivity: A measure of resource utilization efficiency defined as the sum of the outputs divided by the sum of the inputs.
profit ratio: The percentage of profit to sales--that is, profit divided by sales.
PROFORMA: When coupled with the title of another document (proforma invoice, proforma manifest), it means an informal document presented in advance of the arrival or preparation of the required document in order to satisfy a Customs requirement.
PROFORMA INVOICE: An invoice provided by a supplier prior to the shipment of merchandise, informing the buyer of the kinds and quantities of goods to be sent, their value, and important specifications (weight, size, and similar characteristics). When an importer applies for Letter of Credit as the means of payment, a Pro Forma Invoice from the beneficiary of such Letter of Credit, usually the exporter, is required by the L/C issuing bank.
PRODUCT LIABILITY: Liability imposed for damages caused by accident and arising out of goods/products manufactured, sold, handled or distributed by insured or others trading under it’s name.
PROject License: The Bureau of Export Administration uses the project license to authorize large-scale exports of a wide variety of commodities and technical data for specified activities. Those activities are restricted to capital expansion, maintenance, repair or operating supplies, or the supply of materials to be used in the production of other commodities for sale. Items intended for resale in the form received are not permitted and must be effected under a Distribution License.
PROMOTIONAL RATE: A rate applying to traffic under special conditions and usually confined to movement between a limited number of cities. Early rates on fresh farm produce which helped develop increased air freight volumes from the west coast to eastern cities are examples of promotional rates. See SPECIAL RATES.
PROOF OF DELIVERY (POD): Information provided to payer containing name of person who signed for the package with the date and time of delivery. This term has been widely used in courier and express industry and also gaining more attention and implementation at air cargo industry. See also AUTOMATIC POD.
PROOF OF PERFORMANCE: See PROOF OF DELIVERY.
PROPORTIONAL RATE: See ARBITRARY.
PRORATE: A portion of a joint rate between the carriers concerned, on an agreed basis.
PROTECTIVE SERVICE: Many airlines offer a protective service where shippers can arrange to have their shipments under carrier surveillance at each stage of transit from origin to destination. This service can be extended to pickup and delivery. Shippers can also arrange for armed guard protection. There is usually an extra charge for various levels of protective service. See SIGNATURE SERVICE.
Protest: Customs Form 19 allows for a refund of an overpayment of duty if filed within 90 days of liquidation.
PUBLIC WAREHOUSE: Storage place renting space to anybody desiring it. There are 5 types: 1) Ordinary or merchandise. 2) Commodity. 3) Household goods. 4) Cold storage and 5) Field or branch. Some states regard public warehouses as public utilities and fix their rates.
public warehouse receipt: The basic document a public warehouse manager issues as a receipt for the goods a company gives to the warehouse manager. The receipt can be either negotiable or nonnegotiable.
Pull or Pull-through distribution: Supply-chain action initiated by the customer. Traditionally, the supply chain was pushed; manufacturers produced goods and "pushed" them through the supply chain, and the customer had no control. In a pull environment, a customer's purchase sends replenishment information back through the supply chain from retailer to distributor to manufacturer, so goods are "pulled" through the supply chain.
Pull Ordering System: A system in which each warehouse controls its own shipping requirements by placing individual orders for inventory with the central distribution center.
PURCHASE ORDER: Form used by buyer when placing an order for merchandise or supplies.
purchase price discount: A pricing structure in which the seller offers a lower price if the buyer purchases a larger quantity.
Purchasing: The functions associated with buying the goods and services the firm requires.
pure raw material: A raw material that does not lose weight in processing.
Push ordering system: A situation in which a firm makes inventory deployment decisions at the central distribution center and ships to its individual warehouses accordingly.
QA: Abbreviation for
QUALITY CIRCLES: groups of workers formed to improve quality and productivity that are usually task orientated with voluntary participation.
QUALITY CONTROL: The management function that attempts to ensure that the goods or services manufactured or supplied meet the desired specifications.
QUAY: Manmade docking area for loading/unloading of vessels. Docking is parallel allowing loading/unloading from one side of the ship.
Quantity discount: A percentage reduction of a rate based on quantity.
Quick response: A consumer-driven system of replenishment in which high-quality products and accurate information flow through a paperless (EDI) system between all distribution points from manufacturing line to retail checkout counter.
QUOIN: A wedged shaped piece of timber used to secure barrels preventing movement during transit.
QUOTA: The quality of goods of a specific type that may be imported without restriction or the imposition of additional duties. Sometimes importing countries require issuance of licenses before U.S. companies may ship to them.
Quotas and Quota System: Absolute quotas permit a limited number of units of specified merchandise to be entered or withdrawn for consumption during specified periods. Tariff-rate quotas permit a specified quantity of merchandise to be entered or withdrawn at a reduced rate during a specified period. Quotas are established by Presidential Proclamations, Executive Orders, or other legislation. The Quota System, a part of Customs' Automated Commercial System, controls quota levels (quantities authorized) and quantities entered against those levels. Visas control exports from the country of origin. Visa authorizations are received from other countries and quantities entered against those visas are transmitted back to them. Control of visas and quotas simplify reconciliation of other countries' exports and U.S. imports.
R/C: Abbreviation for
R&C: Abbreviation for “Rail and Canal”
R&D: Abbreviation for “Research and Development”
R&E: Abbreviation for “Research and Engineering”
RADIOACTIVE MATERIAL: As defined in the HAZARDOUS MATERIAL REGULATIONS in 49 CFR. Any material or combination of materials which spontaneously emits ionizing radiation and has a specific gravity greater than 0.002 microcuries per gram. The regulations include many more specific definitions of radioactivity.
RAM: Abbreviation for “Random Access Memory”. Temporary memory on micro chips. Users can store data in RAM or take it out at high speeds. However, any information stored in RAM disappears when the computer is shut off.
RATE BASIS: Formula of specific factors/elements which control the making of a rate.
rate basis number: The distance between two rate basis points.
rate basis point: The major shipping point in a local area. Carriers consider all points in the local area to be the rate basis point.
rate bureau: A carrier group that assembles to establish joint rates, to divide joint revenues and claim liabilities, and to publish tariffs. Rate bureaus have published single line rates, which were prohibited in 1984.
RATE CLASS: A rate applicable to a specifically designated class of goods, in or between specified areas.
RATE WAR: When carriers cut rates in an effort to secure tonnage.
RCC: Abbreviation for “Riots and civil commotions”
RCC&S: Abbreviation for “Riots, civil commotions and strikes”
Re-exports: For export control purposes: the shipment of U.S. origin products from one foreign destination to another.
For statistical reporting purposes: exports of foreign-origin merchandise which have previously entered the United States for consumption or into Customs bonded warehouses for U.S. Foreign Trade Zones.
RE-INSURANCE: Insurance of all/part of risk by another insurer previously assumed by an insurance company.
REASONABLE RATE: A rate that is high enough to cover the carrier’s cost but not too high to enable carrier to realize monopolistic profits.
REBATE: Unlawful practice in the USA whereby a carrier returns part of the transportation charges to the shipper in order to encourage the shipper to use the same carrier again.
Recapture Clause: A provision of the 1920 Transportation Act that provided for self-help financing for railroads. Railroads that earned more than the prescribed return contributed one-half of the excess to the fund from which the ICC made loans to less profitable railroads. The Recapture Clause was repealed in 1933.
RECIPROCITY: 1) An exchange of rights. 2) In motor transportation, may involve granting equal rights to vehicles in several states in which reciprocity agreements are in effect. 3) To give preference in buying to vendors who are customers of the company.
RECOURSE: An obligation, if not met, goes back to the original drawer. “Without Recourse” drawing relieves the drawer of liability.
Reconsignment: A carrier service that permits a shipper to change the destination and/or consignee after the shipment has reached its originally billed destination and to still pay the through rate from origin to final destination.
Red Clause Letter of Credit: A letter of credit that allows the exporter to receive a percentage of the face value of the letter of credit in advance of shipment. This enables the exporter to purchase inventory and pay other costs associated with producing and preparing the export order.
Reed-Bulwinkle Act: Legislation that legalized common carrier joint rate making through rate bureaus; extended antitrust immunity to carriers participating in a rate bureau.
REEFER: Slang term for refrigerated trailer for hauling perishables. Sometimes used in reference to other types of transportation equipment. E.g. reefer car equipment referring to a railcar with refrigeration equipment.
Reengineering: A fundamental rethinking and radical design of business processes to achieve dramatic improvements in performance.
refrigerated warehouse: A warehouse that is used to store perishable items requiring controlled temperatures.
regional carrier: A for-hire air carrier, usually certificated, that has annual operating revenues of less than $75 million; the carrier usually operates within a particular region of the country.
regular-route carrier: A motor carrier that is authorized to provide service over designated routes.
REGISTER OF SHIPS: Vessels must be registered in the Marine Registry of some country after inspection, rating, measurement etc. This register, kept normally by the collector of customs, contains names, ownership and other facts relative to each vessel.
REGULAR-ROUTE CARRIER: A motor carrier that is authorized to provide service over designated routes.
RELAY TERMINAL: A motor carrier terminal designed to facilitate the substitution of one driver for another whom has driven the maximum hours permitted.
released-value rates: Rates based upon the shipment's value. The maximum carrier liability for damage is less than the full value, and in return the carrier offers a lower rate.
RELIABILITY: A carrier selection process that considers the variation in carrier transit times and the consistency of the transit times provided.
REMITTANCE FOLLOWING COLLECTION (RFC): In instances when the shipper has performed services incidental to the transportation of goods, a carrier will collect payment for these services from the receiver and remit such payment to the shipper. The carriers charge a nominal fee for this service.
reorder point: A predetermined inventory level that triggers the need to place an order. This minimum level provides inventory to meet the demand a firm anticipates during the time it takes to receive the order.
REPARATION ORDER: Redress in the form of adjustment/reimbursement on account of unjust/unreasonable charges assesses after submission has been proven to the ICC.
REPLEVIN: Legal action instituted to recover possession of property unlawfully taken or detained. This recovery would be accomplished through court action.
RESERVED FREIGHT SPACE: A service by some airlines enabling forwarders and shippers to reserve freight space on designated flights. See PRIORITY AIR FREIGHT. Also RESERVATION.
RESERVATION: See RESERVED FREIGHT SPACE.
RESTRICTED ARTICLES: An airline term meaning a hazardous material as defined by Title 49, Code of Federal Regulations (U.S.) and Air Transport Restricted Articles Circular 6-D. Restricted articles may be transported domestically and be classified dangerous goods when transported internationally by air. See also HAZARDOUS MATERIAL.
Retaliation: Action taken by a country to restrain its imports from another country that has increased a tariff or imposed other measures that adversely affects the firsts country's exports.
RETARDATION: A force causing container and cargo to move fore, aft and upwards.
RETROACTIVE: Application of law, rule, tariff, provision etc. to time before the rule, law, etc. became effective.
Reverse logistics: Sometimes called “Green Logistics”. Refers to aftermarket logistics activities such as returns, repairs, recycling and disposal.
Reverse Preferences: Tariff advantages once offered by developing countries to imports from certain developed countries that granted them preferences. Reverse preferences characterized trading arrangements between the European Community and some developing countries prior to the advent of the Generalized System of Preferences (GSP) and the signing of the Lome Convention.
Revocable Letter of Credit: A letter of credit which can be cancelled or altered by the drawee (buyer) after it has been issued by the drawee's bank.
RF: Abbreviation for “Radio Frequency” whereby users relay information via electromagnetic energy waves from a terminal to a base station, which is linked in turn to a host computer. The terminals can be place at a fixed station, mounted on a forklift truck, or carried in the worker's hand. The base station contains a transmitter and receiver for communication with the terminals. RF systems use either narrow-band or spread-spectrum transmissions. Narrow-band data transmissions move along a single limited radio frequency, while spread-spectrum transmissions move across several different frequencies. When combined with a bar-code system for identifying inventory items, a radio-frequency system can relay data instantly, thus updating inventory records in so-called "real time."
RFC: See REMITTANCE FOLLOWING COLLECTION.
right of eminent domain: A concept that, in a court of law, permits a carrier to purchase land it needs for transportation right-of-way. Used by railroads and pipelines.
RISK: 1) A term usually applied to insurance as a measure of the probability of loss. 2) The degree to which an investor exposes himself to the possibility of the loss of money.
ROLLING: The side to side (ATHWARTSHIP) motion of a vessel.
ROLLING STOCK: Freight/passenger cars owned by rail carriers. Not including motive power equipment. Also buses, trucks and trailers owned by motor carriers.
ROLL-ON/ROLL-OFF (RO/RO): Feature in specially constructed vessels permitting road vehicles to drive on and off the vessel in loading./discharging ports.
RO/RO: See ROLL-ON/ROLL-OFF.
ROUTE –1) Course/direction that shipment moves. 2) To designate course/direction that shipment shall move. 3) Carriers with junction points over which shipment moves.
ROUTING: 1) Process of determining how shipment shall move between point of origin and point of destination. 2) Right of shipper to determine carriers, routes and points of transfer on FTL and FCL shipments.
Royalty: A charge on charter flights levied by some governments before traffic rights are granted. Sometimes called a "no objection fee." Usually a fixed proportion of a total charter value.
rule of eight: Before the Motor Carrier Act of 1980, the ICC restricted contract carriers requesting authority to eight shippers under contract. The number of shippers has been deleted as a consideration for granting a contract carrier permit.
rule of rate making: A regulatory provision directing the regulatory agencies to consider the earnings a carrier needs to provide adequate transportation.
RATE: The amount charged for a unit of weight (or volume) or value of goods. Also, the established shipping charge for movement of goods. In interstate transportation, price/rate is approved by ICC.
RUNNING GEAR: Complementary equipment for terminal and over-the-road handling of containers.
S&FA: “Shipping and
S/N: Abbreviation for “Shipping Note”.
SALVAGE: Rescue of goods from loss at sea or by fire; also, goods so saved or payment made or due for their rescue.
SALVAGE LOSS: In maritime insurance, the loss sustained by necessary sale of goods at a port prior to expected destination because of PERILS OF THE SEA. Treated as total loss with amount realized from the sale of goods credited on amount payable under policy.
Sanitary and Health Certificate: A statement signed by a health organization official certifying the degree of purity, cleanliness, or spoilage of goods, and the health of live animals.
Satellite tracking: Takes advantage of space-age communications to track the whereabouts of a truck. The communications are actually facilitated by two orbiting satellites. One serves as the communications link between driver and dispatcher, the other as the vehicle tracker. Two-way communications between the truck driver and dispatcher are routed through the first satellite. The second tracker satellite gives a fix on location. A truck dispatcher can determine a truck's location by measuring signal length from the tracker satellite to a communications terminal mounted in the truck cab.
SCALE OF RATES: Numerous rates adjusted in relation to each other.
SCHEDULE B: Short form of “Schedule B, Statistical Classification of Domestic and Foreign Commodities Exported from the United States”. All commodities exported from the USA must be assigned a seven-digit Schedule B number. A US Bureau of the Census publication and is based on the Harmonized Commodity Description and Coding System (Harmonized System). Export statistics are initially collected and compiled in terms of approximately 8,000 commodity classifications.
Scheduled Flight: Any service that operates to a set timetable.
SCOW: Hollow, flat bottomed boat used for transporting gravel, sand, and similar bulk commodities.
SCR: “Specified Commodity Rate”. Applied to narrowly specified commodities. Usually granted on relatively large shipments. Theoretically is of limited time duration.
SDI: Abbreviation for “Strategic Defense Initiative”.
SEA-BEE VESSEL: Ocean vessel constructed with heavy duty submersible hydraulic lift or elevator system located in the stern of the vessel. The Sea-Bee system moves barges from one inland coastal water system to another. Sea-Bee barges are larger that LASH barges.
SEAL: Device applied to freight containers, railcars and motor vehicle door fastenings which shows that door fastening where a seal has been applied has not been tampered with between the time of its application and the time of breaking the seal.
SEAWORTHINESS: Sufficiency of vessel in materials, construction, equipment, officers and crew for voyage/service where employed. An implied condition of all policies of maritime insurance unless otherwise specifically stipulated.
Sector: Distance between two ground points within a route.
SED: See SHIPPER'S EXPORTATION DECLARATION.
SELF-INSURANCE: Assumption of risk without insurance coverage through systematic provisions of funds to provide for the loss which individual/company may suffer.
SELF-SUSTAINING: Vessel has its own cranes and equipment mounted on board for loading/unloading. Used in ports where shore cranes and equipment are lacking.
SEMI: Slang term for semi-trailer. Also used loosely in referring to tractor-trailer combination.
Semiconductor Trade Arrangement: The U.S.-Japan Semiconductor Trade Arrangement is a bilateral agreement which came into effect on August 1, 1991, replacing the prior 1986 Semiconductor Trade Arrangement. The new Arrangement contains provisions to: (a) increase foreign access to the Japanese semiconductor market and (b) deter dumping of semiconductors by Japanese suppliers into the U.S. market, as well as in third country markets. In evaluating market access improvement, both governments agreed to pay particular attention to market share. The expectation of a 20 percent foreign market share by the end of 1992 is included in the Arrangement. The Arrangement explicitly states, however, that the 20 percent figure is not a guarantee, a ceiling, or a floor on the foreign market share.
separable cost: A cost that a company can directly assign to a particular segment of the business.
SERVICE COMMITMENTS: Pickup and/or delivery commitments agreed to the carrier and shipper.
setup costs: The costs a manufacturer incurs in staging the production line to produce a different item.
Service: The defined, regular pattern of calls made by a carrier in the pick-up and discharge of cargo.
Service Contract: A contract between a shipper and an ocean carrier of conference, in which the shipper makes a commitment to provide a minimum quantity of cargo over a fixed time period.
SERVICE SHIP AGENT: A liner company to tramp-ship operator representative who facilitates ships arrival, clearance, loading/unloading and fee payment while at a specific port.
Set Up: Articles in their assembled condition.
SHIP BROKER: An individual or company that serves as a go-between for the tramp shipowner and the chartering consignor or consignee.
SHIP CHANDLER: One who furnishes everything necessary to equip a vessel.
ship agent: A liner company or tramp ship operator representative who facilitates ship arrival, clearance, loading and unloading, and fee payment while at a specific port.
ship broker: A firm that serves as a go-between for the tramp ship owner and the chartering consignor or consignee.
Ship's Manifest: A list, signed by the captain of a ship, of the individual shipments constituting the ship's cargo.
SHIP’S PAPERS: Merchant vessels are required to carry the following documents: 1) Register. 2) Log book. 3) Charter party if chartered. 4) Muster roll or list of crew. 5) Ship’s articles. 6) Bill of health. 7) Bills of Lading or duplicate receipts of cargo from master to shipper. 8) Manifest or general statement of cargo. 9) Invoice or detailed statement of cost of goods. 10) Clearance or permission from authorities to sail. 11) Certificate of Inspection. 12) Passenger list if passengers are carried. 13) Bill of sale if the ship has been sold. 14) Officers licenses and 15) License to carry on port trade.
Ship's Tackle: All rigging, etc., utilized on a ship to load or discharge cargo.
SHIPPER: See CONSIGNOR.
SHIPPER'S ACCOUNT NUMBER: See ACCOUNT NUMBER.
SHIPPER’S AGENT: A company that acts primarily to match up small shipments: especially single traffic piggyback loads to permit the use of twin-trailer piggyback rates.
shippers association: A nonprofit, cooperative consolidator and distributor of shipments that member firms own or ship; acts in much the same way as a for-profit freight forwarder.
Shipper's certificate: Form filled out and presented by shipper to outbound carrier at transit point, together with instructions and inbound carrier's freight bill, asking for reshipping privilege and transit rate on commodity previously brought into transit point.
SHIPMENT: 1) Lot of freight tendered at one place for delivery to the consignee at one place, on one or more Bills of Lading. 2) Goods/merchandise in one or more containers, pieces or parcels for transportation from one shipper to single destination.
SHIPPER’S CERTIFICATE: Form filled out and presented by shipper to the outbound carrier at transit point (together with instructions and outbound carrier’s freight bill) which requests re-shipping privileges and transit rates on commodity previously brought into transit point.
SHIPPER'S EXPORTATION DECLARATION (SED): The SED includes complete particulars on individual shipments and is used to control exports and act as a source document for the official US export statistics. SEDs must be prepared for shipments through the US Postal Service when the shipment is valued over $500. SEDs are required for shipments, other than by the US Postal Service, where the value of commodities classified under each individual Schedule B number is over $2,500. SEDs must be prepared, regardless of value, for all shipments requiring a validated export license or destined for countries prohibited by the Export Administration Regulations. SEDs are prepared by the exporter and the exporter's agent and delivered to the exporting carrier (such as: post office, airline, or vessel line). The exporting carrier presents the required number of copies to the US Customs Service at the port of export. The Foreign Trade Statistical Regulations (15 CFR, Part 30) provide the statistical requirements for use by exporters, freight forwarders, and ocean carriers concerning preparation and filing of SEDs.
SHIPPER'S LETTER OF INSTRUCTION: A form used by a shipper to authorize an airline, broker or forwarder to issue an air waybill on the shipper's behalf. The form contains all details of shipment and authorizes the airline, broker or forwarder to sign the air waybill in the name of the shipper.
SHIPPER'S LOAD AND COUNT: Note on bill of lading indication that the contents of a container were loaded and counted by the shipper and not checked or verified by the Steamship Company.
SHIPPING DOCUMENTS: Documents other than transportation receipts or transportation contracts requited to enable shipments to be forwarded or received.
Shipping Mark: The letters, numbers or other symbols placed on the outside of cargo to facilitate identification.
Shipping Weight: Shipping weight represents the gross weight in kilograms of shipments, including the weight of moisture content, wrappings, crates, boxes, and containers (other than cargo vans and similar substantial outer containers).
short-haul discrimination: Charging more for a shorter haul than for a longer haul over the same route, in the same direction, and for the same commodity.
SHORT SHIPMENT: Piece of freight missing from shipment. Cargo received is less than what is stipulated by documents on hand.
short ton: 2,000 pounds.
SHORT-SHIPPED: Cargo manifested but not loaded.
SIC: See STANDARD INDUSTRIAL CLASSIFICATION.
SIGHT DRAFT: A sight draft is a COD in international trade and usually calls for the release of the Bill of Lading and all other documents against cash payment to the collecting bank.
SIGNATURE SERVICE: A service designed to provide continuous responsibility for the custody of shipments in transit. So named because a signature is required from each person handling the shipment at each stage of its transit from origin to destination.
Simulation: A computer model that represents a real-life logistics operation with mathematical symbols and runs it for a simulated length of time to determine how proposed changes will affect the operation.
Single Entry Charter- A non-scheduled flight carrying the cargo of one shipper.
SIT: Abbreviation for “Stopped in Transit”
SITA: See SOCiete International de Telecommunications Aeronautiques.
SITC: See STANDARD INTERNATIONAL TRADE CLASSIFICATION.
Site: A particular platform or location for loading or unloading at a place.
SKIDS: Battens or a series of parallel runners fitted beneath boxes or packages to raise them clear of the floor to permit easy access of forklift blades or other handling equipment.
SKU: See stock-keeping unit:
SL&C: Abbreviation for “Shipper's Load and Count”.
SL&T: Abbreviation for “Shipper's Load and Tally
sleeper team: Two drivers who operate a truck equipped with a sleeper berth; while one driver sleeps in the berth to accumulate mandatory off-duty time, the other driver operates the vehicle.
SLIDING TANDEM: An assembly rigged in a chassis that may be shifted to adjust axle weights.
slip seat operation: A motor carrier relay terminal operation in which a carrier substitutes one driver for another who has accumulated the maximum driving time hours.
slip sheet: Similar to a pallet, the slip sheet, which is made of cardboard or plastic, is used to facilitate movement of unitized loads.
SLURRY: Dry commodities that are made into a liquid form by the addition of water or other fluids to permit pumping through pipelines.
SMALL PACKAGE SERVICE: A specialized service to guarantee the delivery of small parcels within specified express time limits, e.g. “Same-day” or “Next-day”. This traffic is subject to size and weight limitations. Air carriers that also transport passengers will accept these packages at the airport ticket counters with delivery at destination baggage claim area. Many carriers provide door-to-door service on a 24 hour basis.
SOCIETE ANONYME: French name for “corporation”.
SOCiete International de Telecommunications Aeronautiques (SITA): Since 1949, SITA has been providing communications and information solutions to the world's air transport community.
Society of Logistics Engineers: A professional association engaged in the advancement of logistics technology and management.
Soft Currency: The currency of a nation in which exchange may be made only with difficulty. Soft currency countries typically have minimal exchange reserves and deficits in their balance of payments.
software - A computer term that describes the system design and programming that the computer's effective use requires.
SOL: Abbreviation for “Ship Owner's Liability”
South Pacific Forum: The SPF is a regional arrangement for convening 15 governments and territories for deliberations on issues of mutual interest. The Forum was established in 1971; headquarters are in Suva, Fiji; members include: Australia, the Cook Islands, Fiji, Kirbati, Marshall Islands, Micronesia, Nauru, New Zealand, Niue, Papua New Guinea, Samoa, Solomon Island, Tonga, Tuvalu, and Vanatu. The South Pacific Bureau for Economic Cooperation (SPEC) is a subsidiary organization which promotes regional cooperation in the development of the island members in partnership with the more industrially developed countries of the region: Australia and New Zealand.
Special 301: The Special 301 statute requires the United States Trade Representative (USTR) to review annually the condition of intellectual property protection among U.S. trading partners. Submissions are accepted from industry after which the USTR, weighing all relevant information, makes a determination as to whether a country presents excessive barriers to trade with the United States by virtue of its inadequate protection of intellectual property. If the USTR makes a positive determination, a country may be named to the list of: (a) Priority Foreign Countries (the most egregious), (b) the Priority Watch List, or (c) the Watch List. Special 301 (a variation of Section 301) was created by the Omnibus Trade and Competitiveness Act of 1988.
SPECIAL POLICY OF INSURANCE: Document issued on behalf of the Underwriter stating the terms and conditions of the marine insurance. Issued when evidence of insurance is required, as by the bank issuing the Letter of Credit.
SPECIAL RATES: Rates that apply to traffic under special conditions and usually at a limited number of cities. Examples of such rates are container rates, exception ratings, surface-air rates, and import rates.
special-commodities carrier: A common carrier trucking company that has authority to haul a special commodity; the sixteen special commodities include household goods, petroleum products, and hazardous materials.
special-commodity warehouses: A warehouse that is used to store products requiring unique facilities, such as grain (elevator), liquid (tank), and tobacco (barn).
SPECIFIC COMMODITY RATE: Rate applicable to certain classes of commodities. Usually commodities moving in volume shipments. Hence specific commodity rates are usually lower than the general commodity rate between the same pair of cities.
Split Charter: Where a number of consignments from different shippers are carried on the same non-scheduled aircraft. Under U.K. regulations a non-scheduled flight chartered by a single forwarder or agent on behalf of a number of shippers is still classified as a split charter. Under U.S. regulations, a forwarder chartered flight is classified as a single entity although it can consolidate.
SPOTTING: Placing an ocean container or railcar to be loaded/unloaded.
SPREADER: Device for spreading lifting cables on crane to provide balanced lift on four corners of an ocean container allowing load to be lifted straight up.
spur track: A railroad track that connects a company's plant or warehouse with the railroad's track; the user bears the cost of the spur track and its maintenance.
SS: Abbreviation for “Steamship” A steam powered ship (Steam driven turbines)
staff functions: The planning and analysis support activities a firm provides to assist line managers with daily operations. Logistics staff functions include location analysis, system design, cost analysis, and planning.
STANDARD INTERNATIONAL TRADE CLASSIFICATION (SITC): One of a number of numerical commodity codes developed by the United Nations and adopted by the US airlines as the basis for numerical identification of commodities moving in air freight. The SITC was developed in 1950 and is used solely by international organizations for reporting international trade. The SITC has been revised several times; the current version is Revision 3. See HARMONIZED COMMODITY DESCRIPTION AND CODING SYSTEM,
Standard Industrial Classification (SIC): The SIC is the classification standard underlying all establishment-based U.S. economic statistics classified by industry.
STARBOARD: Right side of ship.
Statistical Office of the European Community: EUROSTAT provides European Economic Community-wide statistics on economics, finance, foreign trade, services, transportation, industry, population, social conditions, energy, agricultural, forestry, and other topics. Eurostat offices are located in Luxembourg.
statistical process control: A managerial control technique that examines a process's inherent variability.
STATUTORY NOTICE: Length of time required by law for carriers to give notice of changes in tariffs, rates, rules and regulations. Usually 30 days unless otherwise permitted by the relevant regulatory authorities.
Steamship Agent: A duly appointed and authorized representative in a specified territory acting in behalf of a steamship line or lines and attending to all matters relating to the vessels owned by his principals.
STEAMSHIP CONFERENCES: Collective rate-making bodies for vessels. See also CONFERENCE.
Steamship Line: Company is usually composed of the following departments; vessel operations, container operations, tariff department, booking, outbound rates, inward rates and sales. the company can maintain its own in country U.S. offices to handle regional sales, operations and/or other matters or appoint steamship agents to represent them doing same. Some lines have liner offices in several regions and have appointed agents in others.
stock-keeping unit: A single unit that has been completely assembled. In a DRP system, an item is not considered complete until it is where it can satisfy customer demand.
stockless purchasing: A practice whereby the buyer negotiates a purchase price for annual requirements of MRO items and the seller holds inventory until the buyer orders individual items.
Stockout: A situation in which the items a customer orders are currently unavailable.
stockout cost: The opportunity cost that companies associate with not having supply sufficient to meet demand.
stores: The function associated with storing and issuing frequently used items.
STOW: To arrange in compact mass. E.g. To stow cargo in the hold of a ship.
Stowage: The lacing of cargo in a vessel in such a manner as to provide the utmost safety and efficiency for the ship and the goods it carries.
STRADDLE CARRIER: Mobile truck equipment with the capacity of lifting an ocean container within its own framework.
strategic planning: Looking one to five years into the future and designing a logistical system (or systems) to meet the needs of the various businesses in which a company is involved.
strategic variables: The variables that effect change in the environment and logistics strategy. The major strategic variables include the economy, population, energy, and government.
Strategy: A specific action to achieve an objective.
STRAIGHT BILL OF LADING: Non-negotiable document that provides that shipment is to be delivered direct to the party whose name is shown as the consignee. Carrier does not require its surrender upon delivery unless when needed to identify the consignee.
stretch-wrap: An elastic, thin plastic material that effectively adheres to itself, thereby containing product on a pallet when wrapped around the items.
STRIPPING: In truck transportation, means the emptying the truck of its cargo and arranging shipments by destination.
Structural Impediments Initiative: The SII was started in July 1989 to identify and solve structural problems that restrict bringing two-way trade between the U.S. and Japan into better balance. Both the U.S. and Japanese governments chose issues of concern in the other's economy as impediments to trade and current account imbalances. The areas which the U.S. Government chose as focus included: (a) Japanese savings and investment patterns, (b) land use, (c) distribution, (d) keiretsu, (e) exclusionary business practices, and (f) pricing. Areas which the Japanese Government chose as focus included: (a) U.S. savings and investment patterns, (b) corporate investment patterns and supply capacity, (c) corporate behavior, (d) government regulation, (e) research and development, (f) export promotion, and (g) workforce education and training. In a June 1990 report, the U.S. and Japan agreed to 7 meetings in the following three years to review progress, discuss problems, and produce annual joint reports.
STUFFING: Slang term for loading container with cargo.
SUBROGATION: Right of an insurance company to recover the amount paid to insured from a third party who may have caused the loss. Substitution of one creditor for another.
Subsidy: An economic benefit granted by a government to producers of goods or services, often to strengthen their competitive position.
Substitutability: A buyer's ability to substitute different sellers' products.
Sue & Labor Clause: A provision in marine insurance obligating the assured to do things necessary after a loss to prevent further loss and to act in the best interests of the insurer.
Super 301: This provision was enacted due to Congressional concern that the regular Section 301 procedures narrowly limit U.S. attention to the market access problems of individual sectors or companies. Super 301 sets procedures to identify and address within three years certain "priority", systemic trade restriction policies of other nations. Super 301 was created by the Omnibus Trade and Competitiveness Act of 1988. Super 301 authority expired May 30, 1990.
supplemental carrier: A for-hire air carrier having no time schedule or designated route; the carrier provides service under a charter or contract per plane per trip.
Supply chain: Starting with unprocessed raw materials and ending with the final customer using the finished goods, the supply chain links many companies together. Also, the material and informational interchanges in the logistical process stretching from acquisition of raw materials to delivery of finished products to the end user. All vendors, service providers and customers are links in the supply chain.
Supply chain management: The practice of controlling all the interchanges in the logistics process from acquisition of raw materials to delivery to end user. Ideally, a network of firms interact to deliver the product or service. Also, a combination of traditional logistics functions of distribution and materials management with the procurement of raw materials and/or inventory and sales, marketing, information technology, and strategic planning functions.
supply warehouse: A warehouse that stores raw materials; a company mixes goods from different suppliers at the warehouse and assembles plant orders.
SURCHARGE: An add-on charge to the applicable charges. Motor carriers have a fuel surcharge and railroads can apply a surcharge on any joint rate that does not yield 110 percent of the variable cost.
SURETY BOND: Contract between principal and responsible third party (surety) which makes the surety monetary responsible for the principal’s fulfillment of obligation to obligee (party who is protected).
Surety Company: An insurance company
SURVEYOR: A marine specialist who examines damaged property and determines the cause, nature, and extent of damage and methods of repair and/or replacement. He is not an adjuster, and all his actions are without prejudice to policy terms and conditions.
switch engine: A railroad engine that is used to move railcars short distances within a terminal and plant.
switching company: A railroad that moves railcars short distances; switching companies connect two mainline railroads to facilitate through movement of shipments.
System: A set of interacting elements, variables, parts, or objects that are functionally related to each other and form a coherent group.
SYSTEMS CONCEPT: A decision-making strategy that emphasizes overall efficiency of the individual parts of the system.
T&E: See TRANSPORTATION
T/T: Abbreviation for “Telegraphic Transfer”. Also referred to as “Wire Funds”.
Table of Denial Orders: A list of individuals and firms that have been disbarred from shipping or receiving U.S. goods or technology. Firms and individuals on the list may be disbarred with respect to either controlled commodities or general destination (across-the-board) exports. The list is published in the Export Administration Regulations.
TACM: See TRANSIT AIR CARGO MANIFEST.
TALLY SHEET: List of cargo, incoming and outgoing, checked by a Tally Clerk on dock. Also, a printed form on which companies record, by making an appropriate mark, the number of items they receive or ship. In many operations, tally sheets become a part of the permanent inventory records.
TANDEM: A truck that has two drive-axles or a trailer that has two axles.
tank cars: Railcars designed to haul bulk liquid or gas commodities.
TANKTAINER: Tank built into standard container frame and used to transport liquids.
TAPERING RATE: A rate that increases with distances but not in direct proportion to the distance the commodity is shipped.
TARE: Amount of gross weight on freight shipment that can be deducted from packing weight. Usually allowance is about four pounds per 104 pounds.
TARE WEIGHT: The weight of the container before loading of goods being shipped. The actual weight of the container when empty.
TARIFF: 1) A document setting forth applicable rules, rates, and charges for the movement of goods. A tariff sets forth a contract of carriage for the shipper, the consignee, and the carrier. 2) In addition to the domestic tariffs published by Airline Tariff Publishing Company, some airlines also publish their own tariffs covering special services. International tariffs containing freight rates of the U.S. international carriers are published by the U.S. flag carriers. 3) Offer of goods for transportation by shipper, or offer of delivery by carrier. 4) A general term for any listing of rates, charges, etc. the tariffs most frequently encountered in foreign trade are: tariffs of the international transportation companies operating on sea, on land, and in the air; tariffs of the international cable, radio, and telephone companies; and the customs tariffs of the various countries, which list goods that are duty free and those subject to import duty, giving the rate of duty in each case. There are various classes of customs duties. 5) A tax assessed by a government in accordance with its tariff schedule on goods as they enter (or leave) a country. May be imposed to protect domestic industries from imported goods and/or to generate revenue. Types include ad valorem, specific, variable, or some combination.
Tariff Act of 1930: Title VII of the Tariff Act of 1930, as amended, provides for the imposition of antidumping duties on imported merchandise found to have been sold in the United States at "less than fair value," if these sales have caused or are likely to cause material injury to, or materially retard the establishment of, an industry in the United States.
Tariff Anomaly: A tariff anomaly exists when the tariff on raw materials or semi-manufactured goods is higher than the tariff on the finished product.
Tariff Escalation: A situation in which tariffs on manufactured goods are relatively high, tariffs on semi-processed goods are moderate, and tariffs on raw materials are nonexistent or very low.
TARIFF QUOTAS: Application of a higher tariff rate to imported goods after a specified quantity of the item has entered the country at a lower prevailing rate.
Tariff Schedule: A comprehensive list of the goods which a country may import and the import duties applicable to each product.
Tariff Schedules of the United States Annotated: Effective 1979 to January 1989, the U.S. import statistics were initially collected and compiled in terms of the commodity classifications in the Tariff Schedules of the United States Annotated (TSUSA), an official publication of the U.S. International Trade Commission embracing the legal text of the Tariff Schedules of the United States (TSUS) together with statistical annotations. This publication was superseded by the Harmonized Tariff Schedule of the United States Annotated for Statistical Reporting Purposes (HTSUSA) in January 1989. Effective 1979 to January 1989, the U.S. export statistics were initially collected and compiled in terms of the commodity classifications in Schedule B, Statistical Classification of Domestic and Foreign Commodities Exported from the United States. Schedule B is a U.S. Bureau of the Census publication and, during this period, was based on the framework of the TSUS. In January 1989, this publication was replaced by Schedule B based on the Harmonized System.
TBL: See Through bill of lading.
Technology: BXA regulations define technical data as "information of any kind that can be used, or adapted for use, in the design, production, manufacture, utilization, or reconstruction of articles or materials. Technology can be either "tangible" or "intangible." Models, prototypes, blueprints or operating manuals (even if stored on recording media) are examples of tangible technology. Intangible technology consists of technical services, such as training, oral advice, information guidance and consulting.
Technology Transfer: This term is used to characterize "the transfer of knowledge generated and developed in one place to another, where is it is used to achieve some practical end." Technology may be transferred in many ways: by giving it away (technical journals, conferences, emigration of technical experts, technical assistance programs); by industrial espionage; or by sale (patents, blueprints, industrial processes, and the activities of multinational corporations). Also, the transfer of technology mandated as part of a COUNTERTRADE or offset agreement, other than co-production or license production. It may be in the form of research and development, technical assistance and training, or patent agreements between manufacturers. This is central to many Third World enterprises, public and private, and is the focus of a large number of COUNTERTRADE and offset deals.
Technical Barrier to Trade: According to the Standards Code, a specification which sets forth characteristics or standards a product must meet (such as levels of quality, performance, safety, or dimensions) in order to be imported.
TEMPERATURE CONTROLLED CARGO: Any cargo requiring carriage under controlled temperature.
TEMPERATURE CONTROLLED GROUND HANDLING: Many of the commodities moving in air freight must be protected against sudden changes in temperatures. The temperature of a jet freighters cabin is ideal to maintain perishables in peak condition but the increase in the shipment of perishables by air required new strides in ground handling to protect cargoes from spoilage induced by marked differences in temperatures often encountered on the ground at points of origin and destination. To meet these needs, the airlines have, at some cities, special equipment and facilities ranging from heated vans to temperature controlled holding rooms in which up to 100,000 pounds of perishables can be held at any one time.
TEMPORARY AUTHORITY: The ICC may grant a temporary operating authority as a common carrier for up to 270 days.
TEMPORARY Importation UNDER BOND (TIB): When an importer makes entry of articles brought into the United States temporarily and claimed to be exempt from duty under Chapter 98, Subchapter XIII, Harmonized Tariff Schedule of the United States, a bond is posted with Customs which guarantees that these items will be exported within a specified time frame (usually within one year from the date of importation). Failure to export these items makes the importer liable for the payment of liquidated damages for breach of the bond conditions. (See 19 CFR 10.31.). The Temporary Importation under Bond (TIB) is usually twice the amount of duties and other payments the importer would otherwise be required to pay. Merchandise imported under TIB is usually for sales demonstration, testing, or repair.
TENDER: Offer of goods for transportation by shipper or offer of delivery on part of carrier.
TENOR: The term fixed for payment of a draft.
TERMINAL: An assigned area in which containers are prepared to be loaded into a vessel or are stacked immediately after discharge from the vessel. Any assigned area for the loading/unloading, temporary storage of vehicles or the interchange of freight during transit.
terminal delivery allowance: A reduced rate that a carrier offers in return for the shipper or consignee tendering or picking up the freight at the carrier's terminal.
TERMS OF SALE: The invoice is the sales contract between buyer and seller and indicates the Terms of Sale.
Textile Surveillance Body: An international body which meets in Geneva at the GATT to monitor the Multi-Fiber Arrangement. The TSB receives reports of all textile restrictions and can make recommendations to participants. It can mediate disputes between parties to the MFA but has no binding powers. Membership is balanced between importing and exporting members.
TEU: See Twenty-Foot Equivalent Unit
THE INTERNATIONAL AIR CARGO ASSOCIATION (TIACA): A worldwide organization which brings together all elements of the air logistics industry into a single, dynamic force for progress and growth in the ever-expanding arena of world trade and economic development. TIACA's members include all major components of the industry air and surface carriers, forwarders, shippers, vendors, manufacturers, airports, countries, financial institutions and consultants. TIACA also represents international, national, regional, and city air cargo associations and their students involved in air cargo training. For information: General Secretariat, P.O. Box 33069, Miami, FL 33233.
Third-party provider: A company that supplies goods and services such as transportation and logistics to another company.
Third-party logistics: The use of specialist companies to provide several combined logistics services (for example, storage, transportation, and inventory management) to manufacturers and their customers. Third-party logistics includes Mode selection, including truckload, rail, ship, air, Intermodal, plus expedited and small packages, Carrier management, Private fleet management, Dedicated contract carriage, Information flow and Single billing.
three-layer framework: A basic structure and operational activity of a company; the three layers include operational systems, control and administrative management, and master planning.
THROUGH BILL OF LADING: A single Bill of Lading covering both the domestic and international carriage of an export shipment. An air waybill, for instance, is essentially a Through Bill of Lading used for air shipments. Many ocean shipments require two separate documents (an inland Bill of Lading for domestic carriage and an ocean Bill of Lading for international carriage).
Throughput: A warehousing output measure that considers the volume (weight, number of units) of items stored during a given time period.
TIA: See TRANSPORTATION INTERMEDIARIES ASSOCIATION or Travel Industry Association of America.
TIACA: See THE INTERNATIONAL AIR CARGO ASSOCIATION.
TIB: See TEMPORARY IMPORTATION UNDER BOND.
Tied Aid Credit: Tied aid credit refers to the practice of providing grants and/or concessional loans, either alone or combined with export credits, linked to procurement from the donor country.
Tied Loan: A loan made by a government agency that requires a foreign borrower to spend the proceeds in the lender's country.
TIME DRAFT: Draft maturing at certain fixed time after presentation/acceptance.
TIME DEFINITE DELIVERY: The range of service performance standards offered by air freight carriers which permit the customer to select a specific time frame for delivery based on requirement for service and economy. These service standards provide door-to-door (pickup and delivery) schedule patterns based on “same day”, “next day”, second or third day delivery needs.
time service rate: A rail rate that is based upon transit time.
Timetables: Time schedules of departures and arrivals by origin and destination; typically used for passenger transportation by air, bus, and rail.
TIME UTILITY: A value created in a product by having the product available at a time desired. Transportation and warehousing create Time Utility.
TITLE: Document that confers on holder the right of ownership/possession/transfer of merchandise specified. E.g. the Bill of Lading and Warehouse Receipts.
Title, Passing: The passing of title to exported goods is determined in large measure by the selling terms. For example, if an exporter sells goods CIF he may be presumed to pass ownership and tender of documents. However, he may ship on a bill of lading drawn to his own order, to prevent the buyer from gaining possession of the goods until the draft is paid or accepted. In this case he retains a security title to the goods; that is, a title for security purposes only, until the financial arrangement is carried out. Caution: Depending on the laws of the buyer's country, you may not be able to force passage of title without payment having been received or the buyer having accepted delivery of the goods or a clear understanding by the buyer being understood and accepted.
TL: Abbreviation for “Truckload”.
TOFC: Abbreviation for “Trailer on flatcar”. Also called PIGGYBACK. Shipments that move TOFC receive special rates from tariffs providing for that class of traffic.
TON: A Long Ton is 2,240 pounds. A Short Ton is 2,000 pounds. A Metric Ton is 2,206.6 pounds.
TONNE: See METRIC TON.
TON MILE: One of the most commonly used measures of transportation service. An output measure that reflects the shipment's weight and the distance the carrier hauls it; a multiplication of tons hauled and distance traveled.
TONNAGE: 1) The carrying capacity of a ship or a vessel. 2) The tax/duty paid on such capacity. 3) The weight the ship can carry expressed in tons.
TORT: A wrong, other than breach of contract, committed upon person/property of another.
total cost analysis: A decision-making approach that considers total system cost minimization and recognizes the interrelationship among system variables such as transportation, warehousing, inventory, and customer service.
TOTAL COST OF DISTRIBUTION: The sum total of all the costs incurred in the distribution of goods. The total cost of distribution includes such items as transportation charges, inventory carrying costs, warehousing expenses, packaging, insurance, product obsolescence and pilferage. Today's growing use of automated information systems enables a company to identify each element of cost more accurately and more quickly than ever before. The rise of new concepts of distribution management in which the selection of a freight transport mode sometimes does not hinge upon direct freight charges alone, but on the total cost of distribution, along with service requirements of marketing and sales. Air freight's speed facilitates a more rapid turnover of inventory. This means a more rapid return on inventory investment, the elimination or drastic reduction of warehousing costs, the elimination of the risk of product obsolescence and the avoidance of such cost items as inventory taxes. Packaging costs are lower because of the protection afforded by the aircraft and, increasingly, because of the use of containers. The lower incidence of damage and pilferage in air freight, as compared with surface modes, reduces insurance costs. Usually, but not always, the freight charges via air from point A to point B may be higher than via surface; but savings on the other elements in the total cost of distribution often result in a net saving via air. See TRADEOFFS.
total quality management: A management approach in which managers constantly communicate with organizational stakeholders to emphasize the importance of continuous quality improvement.
TQM: See TOTAL QUALITY MANAGEMENT.
TRACKING/TRACING: A carrier's system of recording movement intervals of shipments from origin to destination.
Trade: A term used to define a geographic area or specific route served by carriers.
TRADE ACCEPTANCE: A draft of which the drawee and acceptor is a mercantile concern. Such an acceptance usually arises from the sale of merchandise.
Trade Barriers: The United States Trade Representative classifies trade barriers into eight general categories: (1) import policies (tariffs and other import charges, quantitative restrictions, import licensing, and customs barriers); (2) standards, testing, labeling, and certification; (3) government procurement; (4) export subsidies; (5) lack of intellectual property protection; (6) service barriers; (7) investment barriers; and (8) other barriers (e.g., barriers encompassing more than one category or barriers affecting a single sector).
Trade Fair Certification Program: The Commerce Department Trade Fair Certification program was started in 1983 to promote selected privately organized trade shows. The program helps private sector organizations in mounting certified international fairs. Commerce assistance includes promoting the fair among foreign customers and helping exhibitors to make commercial contacts.
Trade Information Center: A one-stop source for information on Federal programs to assist U.S. exporters. Telephone: 1-800-USA-TRADE (1-800-872-8723).
Trade Opportunities Program: An International Trade Administration service which provides sales leads from overseas firms seeking to buy or represent U.S. products and services. Through overseas channels, U.S. foreign commercial officers gather leads and details, including specifications, quantities, end use, and delivery deadlines. TOPs are cabled to Washington and listed on the Commerce Department's Economic Bulletin Board and redistributed by the private sector.
TRADEOFFS: Interaction between related activities such as the offsetting of higher costs in one area with reduced costs or other benefits in another. In air freight the classic "Tradeoff" is one of “time versus money” but there are many others in the total cost of distribution.
TRAFFIC: 1) Department/division responsible for obtaining most economical commodity classifications and methods of transporting materials and products, people and/or property carried by transportation companies. 2) People and/or property carried by transportation companies.
Traffic Conferences: Rate-fixing machinery operated by IATA.
TRAFFIC MANAGEMENT: The management of activities associated with buying and controlling transportation services for a shipper, consignee or both.
TRAILER ON FLAT CAR (TOFC): Highway trucks trailers are either lifted on and off in side transfer or else end loaded/unloaded from a fixed ramp. Probably the most common and best known form of piggyback.
TRAILER SHIPS: A vessel similar to a ferry boat carrying cars and trucks. Also known as ROLL-ON/ROLL-OFF (RO/RO) ships.
TRAMP: Vessel that does not operate along definite routes on a fixed schedule but calls at any port where cargo is available. A shipper charters a tramp ship for a particular voyage or a given time period.
transit privilege: A carrier service that permits the shipper to stop the shipment in transit to perform a function that changes the commodity's physical characteristics, but to still pay the through rate.
Transit Zones: Transit zones, a form of free trade zone, are ports of entry in coastal countries that are established as storage and distribution centers for the convenience of a neighboring country lacking adequate port facilities or access to the sea. A transit zone is administered so that goods in transit to and from the neighboring country are not subject to the customs duties, import controls or many of the entry and exit formalities of the host country. Transit zones are more limited facilities then a foreign trade zone or a free port.
TRANSMITTAL LETTER: A list of the particulars of the shipment and a record of the documents being transmitted together with instructions for disposition of documents. Any special instructions are also included.
TRANSACTION STATEMENT: A document that clearly outlines the terms and conditions agreed upon between an importer and an exporter.
TRANSFER CARGO: Cargo arriving at a point by one flight and continuing therefrom by another flight of the same or a connecting carrier.
Transferable Letter of Credit: A letter of credit that allows all or a portion of the proceeds to be transferred from the original beneficiary to one or more additional beneficiaries.
TRANSIT AIR CARGO MANIFEST (TACM): Procedures under which air cargo imports move through the gateway city to the city of final U.S. Customs destination for the collection of duty and other import processing thereby expediting shipment movements, reducing gateway congestion and saving expense for importers, U.S. Customs and airlines.
transit time: The total time that elapses between a shipment's delivery and its pickup.
TRANSIT CARGO: Cargo arriving at a point and departing therefrom by the same through flight.
Transport Index: The number expressing the maximum radiation level in a package of ULD.
TRANSPORTATION AND EXPORTATION (T&E): An entry filed to control the movement of merchandise being transported through the United States for exportation.
Transportation Association of America: An association that represents the entire U.S. transportation system--carriers, users, and the public; now defunct.
TRANSPORTATION INTERMEDIARIES ASSOCIATION (TIA): Organization representing the interests of transportation intermediaries of all disciplines. For information: 3601 Eisenhower Avenue, Suite 110, Alexandria, VA 22304.
transportation method: A linear programming technique that determines the least-cost means of shipping goods from plants to warehouses or from warehouses to customers.
transportation requirements planning: Utilizing computer technology and information already available in MRP and DRP databases to plan transportation needs based on field demand.
Transportation Research Board: A division of the National Academy of Sciences which pertains to transportation research.
Transportation Research Forum: A professional association that provides a forum for the discussion of transportation ideas and research techniques.
TRANSLOADING: The practice of breaking (transferring) bulk shipments from the vehicle/container of one mode to that of another at one or a series of terminal interchange points. Usually, transloading involves transporting a continuous volume of simlilar products creating a rolling (in-transit) inventory of the products.
Transmittal Letter: A list of the particulars of the shipment and a record of the documents being transmitted together with instructions for disposition of documents. Any special instructions are also included.
TRANSSHIP: 1) Term commonly used to denote the transfer of goods from one means of transportation to another. 2) Rehandling of goods enroute.
TRANSSHIPMENT: Transfer of cargo. The transfer of a shipment from one carrier to another in international trade, most frequently from one ship to another. In as much as the unloading and reloading of delicate merchandise is likely to cause damage, transshipments are avoided whenever possible.
transshipment problem: A variation of the linear programming transportation method that considers consolidating shipments to one destination and reshipping from that destination.
travel agent: A firm that provides passenger travel information; air, rail, and steamship ticketing; and hotel reservations. The carrier and hotel pay the travel agent a commission.
Travel Industry Association of America (TIA): A Washington DC based national, non-profit association that serves as the unifying organization for all components of the U.S. travel industry, the third largest retail industry and one of the largest employers in the USA.
Trigger Price Mechanism: An antidumping mechanism designed to protect U.S. industries from under-priced imports. First used in 1978 to protect the steel industry, the TPM is the price of the lowest cost foreign producer. Imports priced below the trigger price are assessed a duty equal to the difference between their price and the trigger price.
TRIP CHARTER: Hiring of a vessel to haul cargo for a special voyage.
TRUCK/AIR SERVICE: The surface movement of air freight to and from airports and origin and destination points beyond the terminal area of pickup and delivery service.
Truckload: Truckload rates apply where the tariff shows a truckload minimum weight. Charges will be at the truckload minimum weight unless weight is higher.
trunk lines: Oil pipelines used for the long-distance movements of crude oil, refined oil, or other liquid products.
TRUST RECEIPT: Release of merchandise by a bank to a buyer in which the bank retains title to the goods. The Buyer is obligated to maintain the goods: or the proceeds from their sale: distinct from the remainder of his assets and to hold them ready for repossession by the bank. Also BAILEE RECEIPT.
TSUSA: The Tariff Schedule of the United States, Annotated. TSUSA is the very detailed classification system in which U.S. import data are originally recorded and is the legal basis for import duty calculations by the Customs Bureau. All other import classification systems are some transformation of TSUSA, since the TSUSA commodity identification numbers are the only commodity identification numbers recorded on the actual import declaration documents.
Turnkey Project: Capital construction projects in which the supplier (contractor) designs and builds the physical plant, trains the local personnel on how to manage and operate the facility and presents the buyer with a self-sustaining project (all the buyer has to do is "Turn the Key").
Twenty-Foot Equivalent Unit (TEU): TEU is a measure of a ship's cargo-carrying capacity. One TEU measures twenty feet by eight feet by eight feet: the dimensions of a standard twenty-foot container. An FEU equals two TEUs or one standard 40-foot, ISO Series 1 container equals 2 TEUs.
TWIST LOCK: A set of four visible bayonet-type, shear keys used as a part of a SPREADER to pick up containers or as part of a chassis to secure containers.
two-bin system: An inventory ordering system in which the time to place an order for an item is indicated when the first bin is empty. The second bin contains supply sufficient to last until the company receives the parts.
UCC: Uniform Commercial
UKACC: Abbreviation for “United Kingdom Air Cargo Club”.
ULD (UNIT LOAD DEVICE): Term commonly used when referring to containers and pallets. Any type of container, container with integral pallet, aircraft container or aircraft pallet.
ULLAGE: Empty space present when cask/container is not full.
ULTIMATE CONSIGNEE: The ultimate consignee is the person located abroad who is the true party in interest, receiving the export for the designated end-use.
umbrella rate: An ICC rate making practice that held rates to a particular level to protect another mode's traffic.
Unclean Bill of Lading: A bill containing reservations as to the good order and condition of the goods, or the packaging, or both. Examples: "bags torn;" "drums leaking;" "one case damaged;" "rolls chafed."
Unfair Trade Practice: This term refers to any act, policy, or practice of a foreign government that: (a) violates, is inconsistent with, or otherwise denies benefits to the U.S. under any trade agreement to which the United States is a party; (b) is unjustifiable, unreasonable, or discriminatory and burdens or restricts United States commerce; or (c) is otherwise inconsistent with a favorable section 301 determination by the U.S. Trade Representative.
Uniform Warehouse Receipts Act: The act that sets forth the regulations governing public warehousing. The regulations define a warehouse manager's legal responsibility and define the types of receipts he or she issues.
UNIT LOAD DEVICE: See ULD.
UNIT TRAIN: An entire, uninterrupted locomotive car and caboose movement between an origin and destination. Rail movement of large tonnage of single-bulk products between two points.
United States Railway Association: The planning and funding agency for Conrail; created by the 3-R Act of 1973.
unit train: An entire, uninterrupted locomotive, car, and caboose movement between an origin and destination.
United Nations Commission on International Trade Law: UNCITRAL was established in 1966 to aid in harmonizing and unifying international trade law. The Commission has focused on four principal international areas: (a) sales of goods, (b) payments, (c) commercial arbitration, and (d) legislation pertaining to shipping. The Commission issues publications and sponsors training in international trade law.
United Nations Conference on Trade and Development: UNCTAD was set up in December 1964 as a permanent organ of the UN General Assembly. UNCTAD promotes international trade and seeks to increase trade between developing countries and countries with different social and economic systems. UNCTAD also examines problems of economic development within the context of principles and policies of international trade and seeks to harmonize trade, development, and regional economic policies. Headquarters are in Geneva, Switzerland.
United Nations Industrial Development Organization: UNIDO promotes accelerated commercial development in developing countries and encourages industrial cooperation worldwide. As part of its activities, UNIDO identifies promising entrepreneurs in the developing world to the attention of potential partners in industrialized countries through a network of Investment Promotion Services (IPS). IPS offices operate in Austria, China, France, Germany, Italy, Japan, Korea, Russia, Switzerland, and the United States (Washington, D.C.) Established in 1967, UNIDO became a specialized agency on the UN in 1986; headquarters are in Vienna, Austria.
United States-Asia Environmental Program: The US-AEP, announced in January 1992, helps U.S. companies compete in expanding Asian markets for sales of environmental products, services, technologies, and know-how. US-AEP, coordinated by AID, links the efforts of U.S. government agencies in a one-stop service.
United States Council for International Business: USCIB is the American affiliate of the International Chamber of Commerce (ICC), the Business and Advisory Council (BIAC) to the Organization for Economic Cooperation and Development, and the International Organization of Employers (IOE). The Council advocates U.S. business positions to the U.S. Government, to United Nations bodies, and to other international organizations. The Council administers the ATA Carnet System, which issues and guarantees documents that allow duty-free, temporary importation of merchandise overseas. The Council was established in 1945; headquarters are in New York City.
United States Trade Representative: The USTR is a cabinet-level official with the rank of Ambassador who advises the President on trade policy. The USTR coordinates the development of U.S. trade policy initiatives; leads U.S. international trade negotiations; and seeks to expand U.S. exports by promoting removal or reduction of foreign trade barriers. The Office of the USTR was created as the Office of the Special Representative for Trade Negotiations by Executive Order (11075) in January 1963. The Trade Act of 1974 established the Office as an agency of the Executive Office of the President, charged with administering the trade agreements program under the Tariff Act of 1930, the Trade Expansion Act of 1962, and the Trade Act of 1974. Other powers and responsibilities for coordinating trade policy were assigned to the Office by the Trade Act of 1974 and by the President by Executive Order in March 1975, as amended. Reorganization Plan No. 3 of 1979 (implemented by Executive Order in January 1980), charged the Office with responsibility for setting and administering overall trade policy and identified the USTR as the chief representative of the U.S. for all activities of the General Agreement on Tariffs and Trade, for negotiation on trade and commodity issues in the Organization of Economic Cooperation and Development, for negotiations in the United Nations Conference on Trade and Development, and for trade and commodity negotiations in other multilateral institutions and in other bilateral and multilateral negotiations concerning trade as a primary issue.
UNITIZATION: The practice or technique of consolidating many small pieces of freight into a single unit. Also the loading of one or more large items of cargo onto a single piece of equipment such as a PALLET.
unitize: To consolidate several packages into one unit; carriers strap, band, or otherwise attach the several packages together.
UNIVERSAL AIR WAYBILL: See NEUTRAL AIR WAYBILL.
Universal Postal Union: Organization which negotiates international mail charges.
Upper Deck: See Main Deck
Urban Mass Transportation Administration: A U.S. Department of Transportation agency that develops comprehensive mass transport systems for urban areas and for providing financial aid to transit systems.
US Customs Bonded Warehouse: see bonded warehouse.
US Munitions List: The USML identifies those items or categories of items considered to be defense articles and defense services subject to export control. The USML is similar in coverage to the International Munitions List (IML), but is more restrictive in two ways. First, the USML currently contains some dual-use items that are controlled for national security and foreign policy reasons (such as space-related or encryption-related equipment). Second, the USML contains some nuclear-related items. Under Presidential directive, most dual-use items are to be transferred from the USML to the Commerce Department's dual-use list. State, with the concurrence of Defense, designates which articles will be controlled under the USML. Items on the Munitions List face a stricter control regime and lack the safeguards to protect commercial competitiveness that apply to dual-use items.
USANCE: Time allowed for payment of foreign drafts.
USDA: Abbreviation for the “US Department of Agriculture”.
VALUATION, ACTUAL: See
VALUATION CHARGES: Transportation charges assessed on shippers who declare a value of goods higher than the value of carrier’s limits of liability. See DECLARED VALUE FOR CARRIAGE.
Value for Customs Purposes Only: The U.S. Customs Service defines "value for Customs purposes only" as the value submitted on the entry documentation by the importer which may or may not reflect information from the manufacturer but in no way reflects Customs appraisement of the merchandise.
Validated Export License: A document issued by the U.S. government authorizing the export of commodities for which written export authorization is required by law. Two types exist: an Individual Validated License (IVL) and a Special License.
VALUATION CLAUSE: The clause in the Marine Policy that contains a fixed basis of valuation agreed upon by the Assured and the Underwriter and which establishes the insured value of the merchandise. The Clause determines the amount payable under any recoverable loss or General Average contribution.
Value-Added Tax: A European Community (EC) tax assessed on the increased value of goods as they pass from the raw material stage through the production process to final consumption. The tax on processors or merchants is levied on the amount by which they increase the value of items they purchase. The EC charges a tax equivalent to the value added to imports and rebates value-added taxes on exports. Some other countries' retail sales tax also called VAT, such as Taiwan.
VALUE-OF-SERVICE PRICING: Pricing according to the value of the product being transported. Third-degree pricing of discrimination. Demand-orientated pricing. Charging whatever the traffic will bear.
VANNING: A term used for stowing cargo in a container.
VARIABLE COST: A cost that fluctuates with the volume of business.
VAT: See VALUE-ADDED TAX
VENDOR: A firm or individual that supplies goods or services; the seller.
VENDOR-MANAGED INVENTORY: The process by which the vendor manages the inventory of its products in its distribution center. The vendor receives stock information from the customer and then calculates what should be shipped to maintain adequate inventory levels at the retailer's facility.
VESSEL: Generally a craft used or intended to be used as means of transportation by water.
VESSEL TON: 100 cubic feet.
Virtual logistics: A phrase coined by David Frentzel of Mercer Management Consulting to describe the disappearance of the in-house logistics function by name and traditional description. In this scenario, logistics will be managed by many individuals throughout the supply chain, or be outsourced altogether.
VISA: Visas are required by many countries for entry of a foreigner. A visa is a stamp in a foreign national's passport issued by a U.S. consular officer which creates a legal presumption that there are no apparent reason to deny entry into the U.S. Regardless of the stamp, the final decision to grant admission is made by an officer of the U.S. Immigration Service at the port of entry.
VISA WAIVER: A program of selected countries to eliminate the visa requirement on a test basis.
VOLATILITY: 1) Ability of liquid to vaporize. 2) Explosivity.
VOLUME CHARGE: A charge for carriage of goods based on their volume.
Voluntary Export Restriction: An understanding between trading partners in which the exporting nation, in order to reduce trade friction, agrees to limit its exports of a particular good. Also called Voluntary Restraint Agreement.
Voluntary Restraint Agreement: Informal bilateral or multilateral understandings in which exporters voluntarily limit exports of certain products to a particular country destination in order to avoid economic dislocation in the importing country and the imposition of mandatory import restrictions. These arrangements do not involve an obligation on the part of the importing country to provide "compensation" to the exporting country, as would be the case if the importing country unilaterally imposed equivalent restraints on imports.
von Thunen's belts: A series of concentric rings around a city to identify where agricultural products would be produced according to von Thunen's theory.
VOYAGE CHARTER: Engaging services of a vessel (cargo) for specified trip from one port to another at established tonnage rate.
WA: Abbreviation for
WACA: See World Airlines Clubs Association.
WAIS: Abbreviation for “Wide Area Information Server”
WAIVER: 1) Written statement canceling previous claim/right. Usually refers to only one person or specific situation. 2) Intentionally forfeiting a right.
WAN: Abbreviation for “Wide Area Network”
War Risk: The possible aggressive actions against a ship and its cargo by a belligerent government. This risk can be insured by a marine policy with a risk clause.
War Risk Insurance: Insurance issued by marine underwriters against war-like operations specifically described in the policy. In former times, war risk insurance was taken out only in times of war, but currently many exporter cover most of their shipments with war risk insurance as a protection against losses from derelict torpedoes and floating mines placed during former wars and also as a safeguard against unforeseen warlike developments. In the United States, war risk insurance is written in a separate policy from the ordinary marine insurance. It is desirable to take out both policies with the same underwriter in order to avoid the ill effects of a possible dispute between underwriters as to the cause (Marine peril or war peril) of a given loss.
WAREHOUSE: Place for receiving/storing goods and merchandise for-hire. The warehouse is bound to use ordinary diligence in preserving goods.
Warehouse Receipt: A receipt of commodities deposited in a warehouse, identifying the commodities deposited. It is non-negotiable if permitting delivery only to a specified person or firm, but it is negotiable if made out to the order of a person or firm or to a bearer. Endorsement (without endorsement if made out to bearer) and delivery of a negotiable warehouse receipt serves to transfer the property covered by the receipt serves to transfer the property covered by the receipt. Warehouse receipts are common documents in international banking.
WAREHOUSE-TO-WAREHOUSE CLAUSE: The clause in the Cargo Policy that defines when coverage commences and terminates. It is the intent of the policy to attach at the time the goods leave the warehouse of origin named in the Policy, and to continue while the goods are in due course of transit until delivered to the warehouse of destination named in the Policy, where it terminates.
WAREHOUSING: The temporary storing of goods.
WARSAW CONVENTION: An international multilateral treaty which regulates, in a uniform manner, the conditions of international transportation by air. Among other things, it establishes the international liability of air carriers and establishes the monetary limits for loss, damage, and delay. Specifically, the Convention for the Unification of Certain Rule Relating to International Carriage by Air, signed at Warsaw, October 12, 1929, or that convention as amended by the Hague Protocol, 1955, whichever may be applicable.
WASTAGE: Loss of goods due to handling, decay, leakage, shrinkage, etc.
waterway use tax: A per-gallon tax assessed barge carriers for waterway use.
WAYBILL (WB): Document containing description of goods that are part of common carrier freight shipment. Also shows origin, destination, consignee, consignor and amount charged. Copies travel with goods and are retained by originating/delivering agents. Used by carrier for internal record and control especially during transit. Not a transportation contract. See also Air waybill.
WB: See WAYBILL.
WEIGHT: In shipping, weight is qualified further as Gross Weight (weight of goods and container), Net Weight (weight of goods without any container) and Legal Weight (similar to net, determined in such manner as the laws of a particular country/jurisdiction may direct).
weight-losing raw material: A raw material that loses weight in processing.
WEIGHT BREAK: Levels at which the air freight rate per 100 pounds decreases because of substantial increases in the weight of the shipment. Examples of levels at which weight breaks occur (in pounds) are 100, 500, 1,000 3,000, 5,000, and 10,000.
WEIGHT CHARGE: A charge for carriage of goods based on their weight.
WEIGHT STATION: Permanent station equipped with scales at which motor vehicles transporting property on public highways are required to stop for checking of gross vehicle and/or axle weights. Many US states also use portable scales to ensure compliance with their weight limits. Also often combined with port of entry facilities.
Wet Lease: An arrangement for renting an aircraft under which the owner provides crews, ground support equipment, fuel and so on (of dry lease).
WHARF: Loading/discharging terminal built parallel to stream/shore line.
WHARFAGE: 1) Charge made for handling traffic on wharf. 2) Charge made for docking vessels at wharf.
WIP: See Work in Progress.
With Average: A marine insurance term meaning that a shipment is protected from partial damage whenever the damage exceeds 3 percent (or some other percentage). If the ship is involved in a major catastrophe, such as a collision, fire or stranding, the minimum percentage requirement is waived and the insurance company pays for all of the damage.
WITHOUT RECOURSE: When drafts are negotiated “without recourse”, the beneficiary is relieved of responsibility to the holder of the draft to the extent permissible under the contract involved and under the law governing the transaction.
Without Reserve: A term indicating that a shipper's agent or representative is empowered to make definitive decisions and adjustments abroad without approval of the group or individual represented.
work in process: Parts and subassemblies in the process of becoming completed assembly components. These items, no longer part of the raw materials inventory and not yet part of the finished goods inventory, may constitute a large inventory by themselves and create extra expense for the company.
World Airlines Clubs Association (WACA): Established in Cannes, France, in April 1966 when the Riviera Airlines Club hosted a conference of the various airline club representatives to discuss the formation of a world body which would unite and promote the activities of interline clubs throughout the world.
World Bank: The World Bank is an integrated group of international institutions which provides financial and technical assistance to developing countries. The World Bank includes the International Bank for Reconstruction and Development and the International Development Association. World Bank affiliates, legally and financially separate, include the International Center for Settlement of Investment Disputes, the International Finance Corporation, and the Multilateral Investment Guarantee Agency. World Bank headquarters are in Washington, D.C.
World Trade Organization: Provisions to establish the WTO were reached in the Uruguay Round of the General Agreement on Tariffs and Trade (GATT). The WTO is scheduled to be established no later than 1997 as an international organization of comparable stature to the World Bank and the International Monetary Fund. The Organization is expected to facilitate implementation of trade agreements reached in the Uruguay Round by bringing them under one institutional umbrella, requiring full participation of all countries in one new trading system, and providing a permanent forum to discuss new issues facing the international trading system. The WTO system will be available only to countries which: (a) are contracting parties to the GATT, (b) agree to adhere to all of the Uruguay Round agreements, and (c) submit schedules of market access commitments for industrial goods, agricultural goods, and services
WWW: Abbreviation for “World Wide Web”.
X Heavy: Extra Heavy
X Strong: Extra strong
XX Heavy: Double extra heavy
XX Strong: Double extra strong
Y/A: York-Antwerp Rules:
A code of rules adopted by an international convention in 1890,
amended in 1924 and again in 1950, for the purpose of establishing a
uniform basis for adjusting general average. Certain nationalities
decline to observe certain of the rules adopted. United States
shipping interests generally abide by general rule "F" and numbered
rules 1 to 15 and 17 to 22, inclusive and specifically set this
forth in a Bill Of Lading Clause.
YARD (FREIGHT): Unit of track systems within certain area used for storing cars, loading/unloading freight and making up trains, over which movement not authorized by timetable or train order may be made, subject to prescribed signals/regulations.
YARDAGE: Livestock shipped to stockyards is subject to yardage charge in addition to transportation and other charges. Usually assessed on basis of so much per head, varying in amount according to type of livestock.
YIELD: The air transport revenue derived per unit of traffic carried in air transportation. Examples: Revenue per freight ton-mile and revenue per passenger mile flown.
ZIP CODE: A numerical
code, established by the US Postal Service, used for the purpose of
routing and to identify delivery zones. Some carriers apply this
code for freight in the same manner.
ZONE: Any one of a number of sections or districts of the United States used for the purpose of establishing proper rates for parcels, mail, and pickup/delivery.
ZONE-OF-REASONABLENESS: A zone or limit within which air carriers are permitted to change rates without regulatory scrutiny. If the rate change is within the zone, the new rate is presumed to be reasonable.