Glossary

     
 

 

Air Cargo
  Any property (freight, mail, express) carried or to be carried in an aircraft. Does not include passenger baggage.
 
Air Freight
  A service provided for the transport of goods in any volume.
 
Air Waybill
  The air cargo shipping document used by a carrier or its authorized cargo agents. It combines several purposes: documentary evidence of the conclusion of the contract of carriage; proof of receipt of the goods for shipment; freight bill; certificate of insurance (if carrier’s insurance is requested by the shipper); customs declaration; guide to the carrier’s staff in handling, dispatching and delivery of the consignment by air freight. Air waybills are not negotiable.
 
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 scheduled and nonscheduled service.
 
A.T.A. Carnet (Admission Temporaire-Temporary Admission)
  A customs document permitting the holder to carry or send merchandise temporarily into certainforeign countries (for display, demonstration or similar purposes) without payment of Customs duties and posting of Customs bonds.
 
Belly pits or holds
  Compartments located beneath the cabin of an aircraft and used for carriage of cargo, mail and passenger baggage.
 
Bonded Terminal
  An airline terminal approved by the U.S. Customs Service for storage of goods until Customs duties are paid or the goods are otherwise released.
 
Cargo Agent
  An agent appointed by an airline to solicit and process international air freight for shipments.
 
Certificate of Origin
  A document in which the exporter certifies the place of origin (manufacture) of the merchandise being exported. Required by some countries for tariff purposes certifying the country of origin of specified goods.
 
Chargeable Weight
  The weight of the shipment used in determining air freight charges. The chargeable weight may be the actual weight or the dimensional weight, whichever is greater, or on container shipments the gross weight of the shipment less the tare weight of the container.
 
Charter Service
  The temporary hiring of an aircraft,usually on a trip basis, for the movement of cargo or passengers.
 
CIP (Carriage and Insurance Paid To…)
  INCO Term used to define the terms of sale between the buyer and seller of goods internationally. 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 risks of loss of or damage to the goods during carriage. The seller contracts for insurance and pays for the insurance premium. The buyer should note that under the CIP term the seller is only required to obtain insurance on minimum coverage. The CIP term requires the seller to clear the goods for export. This term may be used for any mode of transport.
 
Combi Aircraft
  Aircraft specifically 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 cargo is carried on virtually all scheduled passenger flights in the belly pits below the passenger cabin.
 
Commercial Invoice
  The actual bill of sale for the goods. Not only is it the instrument on which the buyer pays the seller for the goods, it is also used by the customs authorities in the importing country to determine proper classification of the goods being shipped for assessment of duties and taxes, and eligibility for entry into the commerce of that country.
 
Consignee
  A person named as the receiver of a shipment—one to whom a shipment is consigned.
 
Consignor
  One who designates the person to whom goods are to be sent. The consignor is usually the shipper.
 
Containerization
  The practice or technique of using a boxlike device in which a number of packages are stored, protected and handled as a single unit in transit.
 
Country of Origin
  The country of manufacture, production or growth of any article of foreign origin. For goods entering the U.S., further work or material added to an article in another country must effect a substantial transformation in order to render such other country the country of origin.
 
CPT (Carriage Paid To…named place of destination)
  INCO term used to define the terms of sale between the buyer and seller of goods internationally. The seller pays the freight for the carriage of the goods to the named destination. The risk of loss of or damage to the goods, as well as any additional costs due to events occurring after the time the goods have been delivered to the carrier, is transferred from the seller to the buyer when the goods have been delivered into the custody of the carrier. The CPT term requires the seller to clear the goods for export. This term may be used for any mode of transport including multi-modal transport.
 
Customs
  A government authority designated to regulate the flow of goods to/from a country and to collect duties levied by a country on imports and exports.
 
Customs Broker
  A person who is licensed by the U.S. Customs Service to transact Customs business on behalf of importers.
 
Customs Business
  Those activities involving transactions with Customs concerning the entry and admissibility of merchandise, its classification, valuation, the payments 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.
 
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 ICAO Technical Instructions for the Safe Transport of Dangerous Goods by Air and the IATA Dangerous Goods Regulations.
 
DDP (Delivered Duty Paid…named place of destination)
  INCO term used to define the terms of sale between the buyer and seller. The seller fulfills his obligation to deliver when the goods have been made available to 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. This term should not be used if the seller is unable directly or indirectly to obtain the import license. If the parties wish the buyer to clear the goods for importation and to pay the duty, the term DDU should be used. If the parties wish to exclude from the seller’s obligations some of the costs payable upon importation of the goods (such as value added tax VAT), this should be made clear by adding words to this effect: Delivered Duty Paid, VAT UnPaid (…named place of destination). This term may be used irrespective of the mode of transport.
 
DDU (Delivered Duty Unpaid…named place of destination)
  INCO term used to define the terms of sale between the buyer and the seller of goods internationally. The seller fulfills his obligation to deliver when the goods have been made available to the named place in the country of importation. The seller has to bear the costs and risks involved in bringing the goods therefore (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. If the parties wish the seller to carry out customs formalities and bear the costs and risks resulting therefrom, this has to be made clear by adding words to this effect. If the parties wish to include in the seller’s obligations some of the costs payable upon importation of the goods (such as value added tax VAT), this should be made clear by adding words to this effect: Delivered Duty Unpaid, VAT Paid (…named port of destination). This term can be used irrespective of the mode of transport.
 
Dimensional Weight
  Dimensional weight refers to density, i.e. weight per cubic foot.
 
Drawback
  A refund or remission, in whole or in part, of a customs duty, internal revenue tax, or fee lawfully assessed or collected which is provided at the time of re-exportation
 
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). Some other factor such as weight or quantity (specific duties) or a combination of value and other factors (compound duties).
 
Express consignment operator or carrier
  An entity operating in any mode or intermodally moving cargo by special express commercial service under closely integrated administrative control. Its services are offered to the public under advertised, reliable timely delivery on a door-to-door basis.
 
EXW (EX WORKS…named place)
  INCO term used to define the terms of sale between the buyer and seller of goods internationally. The seller fulfills his obligation to deliver when he has made the goods available at his premises (i.e. works, factory, warehouse, etc.) to the buyer. In particular, he is not responsible for loading the goods on the vehicle provided by the buyer or for clearing the goods for export, unless otherwise agreed. The buyer bears all costs and risks involved in taking the goods from the seller’s premises to the desired destination. This term thus represents the minimum obligation for the seller. This term should not be used when the buyer cannot carry out directly or indirectly the export formalities. In such circumstances, the FCA term should be used.
 
FCA (Free Carrier…named place)
  INCO term used to define the terms of sale between the buyer and seller of goods internationally. 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. If no precise point is indicated by the buyer, the seller may choose within the place or range stipulated where the carrier shall take the goods into his charge. When, according to commercial practice, the seller’s assistance is required in making the contract with the carrier, the seller may act at the buyer’s risk and expense. This term may be used for any mode of transport, including multimodal transport.
 
Foreign Trade Zones (FTZ)
  Facilities for conducting international trade activities whereby the usual customs duties and taxes are not required on foreign merchandise unless and until it enters the Customs territory for domestic consumption, in which case the importer ordinarily has a choice of paying duties either on the original foreign material or the finished product.
 
Freight Forwarder
  A person engaged in the business of dispatching shipments on behalf of other persons for a consideration in foreign commerce between the U.S., its territories or possessions, and foreign countries, and of handling the formalities incident to such shipments.
 
Gross Weight
  Entire weight of a shipment including containers and packaging material.
 
Harmonized Tariff Schedule of the United States
  A multipurpose international goods classification system designed for use by manufacturers, transporters, exporters, Customs statisticians and others in classifying goods moving in international trade.
 
Importer
  The person primarily liable for the payment of any duties on the merchandise, or an authorized agent acting on his behalf. The importer may be the consignee, the importer of record or the actual owner of the merchandise.
 
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 use rather than becoming expensive inventory that occupies costly warehouse space.
 
Letter of Credit (L/C)
  A document issued by a bank per instructions by a buyer of goods authorizing the seller to draw a specified sum of money under specified terms, usually the receipt by the bank of certain shipping documents, within a given time.
 
Proforma Invoice
  An abbreviated invoice, usually sent in advance of a shipment, for the purposes of quotation, opening a letter of credit, obtaining an import license, or shipping samples. Whenever using the proforma invoice, it is usually subject to correction upon receipt of the actual invoice.
 
Shippers Export Declaration (SED)
  Used for compiling the official U.S. export statistics and administering the requirements of the U.S. Export Administration Act and is required for virtually all shipments, including hand-carried merchandise.
 
Subzone
  A special-purpose zone established as part of a zone project for a limited purpose, that cannot be accommodated within an existing foreign trade zone.
 
Tare Weight
  The weight of the container before loading of goods being shipped; the actual weight of the container when empty.
 
U.L.D. (Unit Load Device)
  Term commonly used when referring to containers and pallets.
 
Valuation Charges
  Transportation charges assessed shippers who declare a value of goods higher than the value of the carriers’ limits of liability.
 
Weight Break
  Levels at which the air freight rate per 100 pounds decreases because of substantial increases in the weight of the shipments.