Importing Terms

The following glossary is a guide listing important terms and concepts related to international importing and shipping.

A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z

Actual Time of Arrival – ATA: When the goods arrive in port.

Actual Time of Departure – ATD: When the goods depart from the port.

Advising Bank: A bank, operating in the exporter’s country, that handles letters of credit for a foreign bank by notifying the export firm that the credit has been opened in its favor. The advising bank fully informs the exporter of the conditions of the letter of credit without necessarily bearing responsibility for payment.

Agency Fee: Transportation charge payable to the port agent by a ship-owner or operator.

Air Waybill -AWB: A bill of lading which covers both international and domestic flights, that transports goods to a location. The AWB is used as a receipt for the shipper to confirm they have accepted the shipment and will be responsible for delivering the goods to the destination.

Anti-Dumping Duty – ADD: Anti-Dumping Duty is a measure by EU Customs to protect domestic producers from unfair foreign competition. Goods imported into EU below “fair market” prices through dumping or government subsidy, are subject to anti-dumping or countervailing duties.

Arbitrary – ARB: An arbitrary is part of the transportation costs. For ocean, normally an add-on inland cost to. For air, normally a constructed rate, combining the normal rate from major airport A to major airport B, then the added rate to minor airport C.

Arrival Notice – A/N: An import document send to the notify party or importer’s broker containing all the necessary arrival information for Customs clearance, normally with freight charges.

Authorized Consignee: A person who has been authorized to receive at his premises, or at any other specified place, the goods under a transit procedure, without presenting them and the transit declaration at the office of destination.

Authorized Consignor: A person who has been authorized to carry out transit operations, without presenting the goods and the transit declaration, at the office of departure.
Automated Broker Interface – ABI: A system that allows customs brokers to file entry electronically with U.S. Customs.

Automated Entry Processing: The system responsible for the validation, processing, duty accounting and clearance of customs declarations.

Automated Export System – AES: The system that allows exporters to file export declarations electronically with U.S. Customs.

Beneficiary: The person in whose favor a letter of credit is issued or a draft is drawn.

Bill of Lading – B/L: Bills of lading are contracts between the owner of the goods and the carrier. There are two types. A straight bill of lading is nonnegotiable. A negotiable or shipper’s order bill of lading can be bought, sold, or traded while goods are in transit and is used for many types of financing transactions. The customer usually needs the original or a copy as proof of ownership to take possession of the goods.

Binding Tariff Information – BTI: Written information issued by the customs authorities on the classification of goods

Booking – BKG: A booking is a reservation with carrier arranged by the shipper or his representative for space and / or equipment aboard a specific ship or aircraft departing at a specific time.

Bond Premium: A fee for the coverage offered by a Single Transaction Bond.
Bond System: This is a part of the Customs’ Automated Commercial System that provides information on bond coverage. A Customs bond is a contract between a principal, 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 Warehouse -BW: A bonded warehouse is a U.S. Customs authorized facility allowed to receive, store and ship cargo not yet cleared through Customs. The facility is licensed by Customs and operates under Customs authority.

Cargo Insurance: Cargo 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.

Certificate of Inspection: This certificate is a document that states the condition of merchandise prior to being shipped.

Certificate of Insurance: This certificate is a document stating that the specified producer’s goods are insured.

Certificate of Manufacture: This certificate is a document stating where producer manufactured the goods being shipped and that manufacturing is complete.

Certificate of Origin: This certificate is a document indicating where the shipped good, or the majority of its content, was produced.

Cost & Freight – C&F: The buyer of the goods pays a total sum that covers the cost of goods and the cost of transport from the origin, to a destination.

Commercial Invoice: The commercial invoice is a bill for the goods from the seller to the buyer. These invoices are used by the US to determine the true value of goods for the assessment of customs duties and are also used to prepare consular documentation.

Consignee: 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.

Container Freight Station – CFS: The carrier’s facility where parcels of cargo are grouped and loaded into containers.

Cost Insurance Freight – CIF: The cost, insurance, and freight is included in the seller’s quotation. This term is generally used for ocean shipments.

Carriers Owned Containers – COC: This term stands for Carriers Owned Containers, it means that the containers used for transport of cargoes belong to the carrier.

Cash In Advance – CIA: Payment for goods in which the price is paid in full before shipment is made. This method is usually used only for small purchases or when the goods are built to order.

Cash With Order CWO: Payment for goods in which the buyer pays when ordering and in which the transaction is binding on both parties.

Certificate of Origin: A document, required by certain foreign countries for tariff purposes, certifying the country of origin of specified goods.

Container Load Plan – CLP: A plan to stipulate how goods should be loaded, location in the container and maximum load heights. This plan may have such details: individual and total weight, shippers, consignees, markings and measurements, origin and destination of the goods.

Container Service Charge – CSC: The cost for a country-sided handling of FCL containers at a “free on board” delivery.

Container Yard – CY: The place where FCL shipments and empty containers will be assumed by the customer or be delivered by the ship owner to the customer.

Currency Adjustment Factor- CAF: This is the compensation factor for the various currencies.

Customs Audits: The process of ensuring a business is in compliance with Customs legislation through a thorough examination of relevant business account information and other records.

Customs Brokerage: A professional service that involves the processing of shipments and goods through customs barriers for importers and exporters. This involves the preparation of documents, payment of duties & taxes, and communication of information on behalf of the client with the border authorities.

Delivered Duty Unpaid- DDU: With DDU the shipper clears the goods for export and is responsible for delivery or make the goods available for the buyer at the specified location where the buyer will clear the duty at the arrival destination.

Delivered Duty Paid – DDP: The shipper clears the goods for export and is also responsible for delivering to the destination including duty and import taxes.

Delivery Order – DO

Demurrage: Excess time taken the loading or unloading of a vessel, thus causing delay of a scheduled departure. Demurrage refers only to situations in which the charter or shipper, rather than the vessel’s operator, is at fault.

Destination DC: A charge assessed by the carrier for the handling a full container at the destination.

Double Stack Train -DST: Two 40′ GP containers stacked on top of one another.

Estimated Time of Arrival -ETA: The estimated time of arrival of the carrier.

Estimated Time of Departure – ETD: The estimated time of departure of the carrier.

Freight Collect – CC: Freight charges to be collected at destination from the consignee by carrier

Freight Prepaid – PP: Freight charges to be paid by the shipper at origin to carrier.

Full Berth Terms -FBT: Indicate that the costs of loading and discharge are included in the quote, and will be paid by the carrier.

Full Container Load – FCL: This is an arrangement between the shipper and the carrier or the forwarder. The shipper packs the cargo into a container, before delivering to the container terminal.

Freight on Board – FOB: Indicates that the seller is responsible for delivering the shipment to the destination, free of all transportation fees. Once arrived at the designated location, the buyer then becomes responsible for the goods and the risk of damage.

Free Storage Paid – FSP: The period offered by the carrier, free of charge, at the destination where the goods are allowed to be delivered by the consignee. Usually this is limited to three days after which a daily rate will be billed.

Gross Weight – GW: Actual weight of shipment including packing material

Harbor Maintenance Fee – HMF: Charges assessed to harbor users for maintenance purposes. Part of customs duty; currently 0.125%

High Cube container – HC: A type of container with exterior dims of 40′(L)x8′(W)x9′(H), used to transport large volume but low weight cargo.

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 buyer. Compare Revocable letter of credit.

Less than Container Load – LCL: A shipment that takes up only a portion of a consolidated container

Letter of Credit – L/C: 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 met.

Merchandise Processing Fee – MPF: A part of Customs duty; currently 0.19%

Notify Party: The name and address of a party in the transport document to be notified by the shipping company of the arrival of a shipment.

Packing List: A shipping document issued by shipper to carrier, Customs and consignee serving the purposes of identifying detail information of package count, products count, measurement of each package, weight of each package, etc.

Port of Discharge – POD: This is where the container is discharged from the vessel.

Port of Loading – POL: This is the location where the goods are loaded onto the vessel.

Pro Forma Invoice: An invoice provided by a supplier prior to the shipment of merchandise, informing the buyer of the merchandise and quantities to be sent, their value, weight and size.
Proof of Delivery- POD: A cargo or package receipt with the signature of the recipient.

Reefer Container – RFC: A thermal container with refrigerating apparatus to control the temperature of its cargo

Revocable Letter of Credit: A letter of credit that can be canceled or altered by the buyer after it has been issued by the buyer’s bank. Compare Irrevocable letter of credit.

Shipper Export Declaration – SED: The form that is required to be completed prior to exporting goods.

Shipper Owned Container – SOC: The container used for transport belongs to the shipper.

Shipping Weight: Shipping weight represents the gross weight in kilograms of shipments, including the weight of moisture content, wrappings, crates, boxes, and containers.

Single Entry Bond: A type of U.S. Customs bond required by Customs at time of entry. The bond applies only to that particular shipment.

Standard International Trade Classification – SITC: The numeric code used by the United Nations to classify goods used in international trade.

Storage Charge: Charges assessed by the warehouse for storage after the cargo’s free time has expired.

Transhipment – T/S: A shipping arrangement in which a shipment is discharged off the vessel at an intermediate port in route and subsequently reloaded to another vessel for transport to its final destination

Waybill – WB: A document on the goods that shows the origin, destination, route, consignor, consignee, description of shipment and the amount charged for the transportation service. This document is not a document of title, unlike the bill of lading.