GLOSSARY

Here you will find a list in an alphabetic order with the most used logistic terms. There are many shipping terms in logistics industry where it becomes difficult to recognise all of them, but don’t worry Sino shipping have carefully selected the most common terms which you will encounter in logistics.

 

A

 

Ad Valorem Tarif: A tariff calculated “according to value“, or as a percentage of the value of goods cleared through customs; for example, 15 percent ad valorem means 15 percent of the value of the entered merchandise

 

Air Waybill: A bill of lading that covers both domestic and international flights that transport goods to a specified destination. This is a non-negotiable instrument of air transport that serves as a receipt for the shipper, indicating that the carrier has accepted the goods listed and is obligated to carry the consignment to the airport of destination according to specified conditions.

 

ATA Carnet:  An ATA Carnet (a. k. a. “Merchandise Passport”) is a document that facilitates the temporary importation of products into foreign countries by eliminating tariffs and value-added taxes (VAT) or the posting of a security deposit normally required at the time of importation.

 

Aggregate Shipment: Numerous shipments from different shippers to one consignee that are consolidated and treated as a single consignment

 

(AD) Anti-Dumping: Anti-dumping suits, along with ‘safeguards’ and ‘countervailing measures’, are tools for protecting domestic industries from surges of cheap foreign imports. Although the WTO strives to eliminate all trade barriers, it recognizes that nations require flexibility to adjust to economic shocks as multilateral agreements increasingly liberalize trade. Thus, these measures allow nations to temporarily protect their economies against fluctuations in trading patterns.

 

Alongside: 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

 

Advice of Shipment:  A notice sent to a local or foreign buyer advising that shipment has gone forward and containing details of packing, routing, etc. A copy of the invoice is often enclosed and, if desired, a copy of the bill of lading.

 

Anti-Diversion Clause: Prevents exported goods from going to destinations not approved by the government. In the United States, the Department of Commerce’s Bureau of Export Administration requires commercially exported goods to be accompanied by a destination control statement saying that the goods are only authorized for export to certain locations and that U.S. law prohibits their diversion. The latter part of this statement is the anti-diversion clause.

 

Arbitrage: The process of buying foreign exchange, stocks, bonds, and other commodities in one market and immediately selling them in another market at higher prices.

 

B

 

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 exists.

 

Bill of Lading (B/L):  A document that establishes the terms of a contract between a shipper and a transportation company under which freight is to be moved between specified points for a specified charge. Usually prepared by the shipper on forms issued by the carrier

  1. A receipt for the goods delivered to the carrier for shipment.
  2. A definition of the contract of carriage of the goods.
  3. A Document of Title to the goods described therein.
  4. This document is generally not negotiable unless consigned “to order.”

 

Bonded Warehouse: A warehouse authorized by customs for storage of goods on which payment of duties is deferred until the goods are removed.

 

Booking: Arrangements with a carrier for the acceptance and carriage of cargo; i.e., a space reservation.

 

Broker of Trade: Someone that acts as an agent for others, as in negotiating contracts, purchases, or trade sales in return for a fee or commission

 

C

 

Consignee: The individual or company to whom a seller or shipper sends merchandise and who, upon presentation of necessary documents, is recognized as the merchandise owner for the purpose of declaring and paying customs duties

 

(CFR) Cost and Freight: A pricing term indicating that the cost of the goods and freight charges are included in the quoted price; the buyer arranges for and pays insurance. Also see C&F

 

CBM: Abbreviation for Cubic meter

 

Consolidator: An agent who brings together a number of shipments for one destination to qualify for preferential rates

 

Carrier:  Any person who, through a contract of carriage, undertakes to perform or procure the performance of carriage by rail, road, sea, air, inland waterway, or by a combination of modes

 

Clean Bill of Lading: A receipt for goods issued by a carrier which indicates that the goods were received in “apparent good order and condition,” without damages or other irregularities. Compare Foul bill of lading.

 

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

 

(CIF) Cost, Insurance, Freight: A pricing term indicating the cost of the goods, insurance, freight, and the ports involved in the transportation.

 

Commercial Invoice: Receipt for a transaction and or goods purchased (invoice) indicating the sender or seller and the receiver or purchaser. A commercial invoice should contain an itemized list of the merchandise with the complete description of goods with their unit value and extended total value. Depending on the Customs requirements of the destination country, there may be additional requirements, statement or clauses that must appear as well.

 

Commodity: any article exchanged in trade but most commonly used to refer to raw materials, including such minerals as tin, copper, and manganese, and bulk-produced agricultural products such as coffee, tea.

 

Customs: The authorities designated to collect duties levied by a country on imports and exports. The term also applies to the procedures involved in such collection

 

CNTR NO: Container number

 

D

 

DDC: Destination Delivery Charge.

 

DDP (Delivered Duty Paid): A transaction in international trade where the seller is responsible for making a safe delivery of goods to a named destination, paying all transportation expenses but not the duty. The seller bears the risks and costs associated with supplying the good to the delivery location, whereas the buyer is responsible for paying the duty and other customers clearing expenses.

 

(DDP) Delivered Duty Paid: A transaction in which the seller is responsible for all of the costs related to transporting the goods, and for the goods themselves, until they have been received and transferred to the buyer. This includes paying for the shipping, duties, and any other expenses incurred while shipping the goods.

 

Demurrage: A penalty for exceeding free time allowed for loading or unloading at a pier or freight terminal. Also a charge for undue detention of transportation equipment or carriers in port while loading or unloading.

 

Door to Door: Through transportation of a container and its contents from consignor to consignee. Also known as House to House. Not necessarily a through rate.

 

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)

 

Draft: An unconditional order in writing from one person (the Drawer) to another (the Drawee), directing the drawee to pay a specified amount to a named drawer on presentation or on a fixed date

 

Drawee: The individual or firm on whom a draft is drawn and who owes the stated amount to the drawer

 

 

E

 

Export License: A document secured from a government, authorizing a shipper to export a specific quantity of a particular commodity to a certain country. An export license is often required when a government places restrictions upon exports

 

Exchange Permit: A permit sometimes required by the importer’s government to enable the import firm to convert its own country’s currency into foreign currency with which to pay a seller in another country

 

ETA: Estimated time of arrival
ETD: Estimated time of departure

 

Ex Works: terms the buyer is responsible for the whole shipment from door to door. All costs and liabilities are with the buyer. Ex Works (sometimes shown as EXW or ExWorks) is a widely used international shipping term or Incoterm

 

Export Declaration: The U.S. Treasury Department requires an export declaration for all export shipments, indicating the value, weight, destination, and other basic information about the shipment

 

F

 

(FOB) “Free on board”: A pricing term indicating that the quoted price covers all expenses up to and including delivery of goods upon an overseas vessel provided by or for the buyer

 

Freight Forwarder: An independent business that handles export shipments for compensation. A freight forwarder is among the best sources of information and assistance on U.S. export regulations and documentation, shipping methods, and foreign import regulations

 

FCL: Full container load, a common shipping term used in the international logistics industry for export and import ocean freight

 

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 from the zone into the commerce of another country

 

Free-Trade Zone: A port designated by the government of a country for duty-free entry of any non-prohibited goods. Merchandise may be stored, displayed, used for manufacturing, etc., within the zone and re-exported without duties being paid. Duties are imposed on the merchandise (or items manufactured from the merchandise) only when the goods pass from the zone into an area of the country subject to the customs authority.

 

G

 

GATT (General Agreement on Tariffs and Trade): A multilateral treaty signed in 1947 to help reduce trade barriers between signatory countries and to promote trade through tariff concessions. The workings of the GATT agreement are the responsibility of the Council for Trade in Goods, which is made up of representatives from all WTO member countries. GATT membership now includes more than 110 countries

 

Gross Weight (GR Wt./GW ): The full weight of a shipment, including containers and packaging materials

 

General Export License: Any of various export licenses covering export commodities for which Individually Validated Export Licenses (IVEL) are not required. No formal application or written authorization is needed to ship exports under a general export license.

 

I

 

Import license: A document required and issued by some national governments authorizing the importation of goods into their individual countries.

 

Importer of Record: The importer is legally liable for payment of duties, taxes, and fees for compliance with customs and other government agency regulations pertaining to their imports. The importer of record may be the party who is buying or receiving the imported goods, or an interested party in the transaction who has the right to take entry under the customs regulations.

 

L

 

LCL:  Less than Container Load; Less than Car load

 

(L/C) Letter of credit: Issued by a bank per instructions by a buyer of goods, an LC authorizes the seller to draw a specified sum of money under specified terms, usually the receipt by the bank of certain document within a given time

 

Landed Cost: The total cost of a good to a buyer, including the cost of transportation.

 

M

 

Manifest: A list of the goods being transported by a carrier

 

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. Cargo is assessed a certain rate for every 40 cubic feet or one cubic meter it occupies

 

M/T or Metric Ton: 1000 Kilos

 

Marking: Letters, numbers, and other symbols placed on shipment packages to facilitate identification. Also known as marks

 

Market Disruption: A situation where a surge in imports of a certain product causes a sharp decline in the domestic sales of that product, thereby creating a hardship for domestic producers

 

N

 

Net Weight (Actual Net Weight): The weight of the goods alone without any immediate wrappings; e.g., the weight of the contents of a tin can without the weight of the can.

NT: Net Tons.

NAFTA (North American Free Trade Agreement): A free trade agreement comprising the U.S.A., Canada, and Mexico.

 

O

 

Ocean Bill of Lading: A bill of lading (B/L) indicating that the exporter consigns a shipment to an international carrier for transportation to a specified foreign market. Unlike an inland B/L, the Ocean Bill of Lading also serves as a collection document. If it is a “straight” B/L, the foreign buyer can obtain the shipment from the carrier by simply showing proof of identity. If a “negotiable” B/L is used, the buyer must first pay for the goods, post a bond, or meet other conditions agreeable to the seller

 

On Board Bill of Lading: A bill of lading in which a carrier certifies that goods have been placed on board a certain vessel

 

Order Bill of Lading: A negotiable bill of lading made out to the order of the shipper

 

P

 

Port of Discharge: A port where a vessel is off-loaded and cargo discharged

 

Port of Entry: A port at which foreign goods are admitted into the receiving country

 

Port of Loading:  A port where cargo is loaded aboard the vessel, lashed, and stowed.

 

Packing list: A list showing the number and kinds of items being shipped, as well as other information needed for transportation purposes

 

Pro forma 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, etc.)

 

Proof of Delivery (POD): The delivery receipt copy of a freight bill indicating the name of the person who signed for a package with the date and time of delivery

 

Q

 

Quota: The quantity of goods of a specific kind that a country permits to be imported

 

Quotation: An offer to sell goods at a stated price and under specific conditions

 

S

 

Shipment: Freight tendered to a carrier by one consignor at one place at one time for delivery to one consignee at one place on one bill of lading

 

Ship’s Manifest: An instrument in writing, signed by the captain of a ship that lists the individual shipments constituting the ship’s cargo

 

Short-Shipped: Cargo manifested but not loaded

 

Shipper: The person or company who is usually the supplier or owner of commodities shipped. Also called Consignor

 

Schedule B: Refers to the statistical classification of domestic and foreign commodities exported from the United States. All commodities exported from the United States must be assigned a seven-digit Schedule B number

 

T

 

Tracking:  A system of recording movement intervals of shipments from origin to destination

 

Trade Barriers: Government laws, regulations, policies, or practices that either protect domestic products from foreign competition or artificially stimulate exports of particular domestic products

 

Tare Weight: The weight of a container and packing materials without the weight of the goods it contains

 

Terminal: An assigned area in which containers are prepared for loading into a vessel, train, truck, or airplane or are stacked immediately after discharge from the vessel, train, truck, or airplane

 

Tariff (the rate of duty): A schedule or system of duties imposed by a government on goods imported

 

Time Draft: A draft that matures either a certain number of days after acceptance or a certain number of days after the date of the draft. Compare Date draft and Sight draft

 

TEU: Twenty feet Equivalent Unit

 

Transaction statement: A document that delineates the terms and conditions agreed upon between the importer and exporter

 

UN numbers or UN IDs: four-digit numbers that identify dangerous goods, hazardous substances and articles (such as explosives, flammable liquids, toxic substances, etc.) in the framework of international transport

 

V

 

Value Added: The difference between the value of goods produced and the cost of producing them – the wages, interest, rent, and profits added to the output by a firm or industry

 

(VAT) Value Added Tax: A sales tax which is generally calculated by foreign countries on the basis of Cost Insurance Freight (CIF) value plus duty

 

W

 

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. Warehouse receipts are common documents in international banking

 

Weight

  • Gross – The weight of the goods including packing, wrappers, or containers, both internal and external. The total weight as shipped.
  • Net – The weight of the goods themselves without the inclusion of any wrapper.
  • Tare – The weight of the packaging or container.
  • Weight/Measurement Ton – In many cases, a rate is shown per weight/measurement ton, carrier’s option. This means that the rate will be assessed on either a weight ton or measurement ton basis, whichever will yield the carrier the greater revenue.
  • Weight Ton – Metric measure equals 1000 Kilograms; in English measure a short ton is 2000 pounds, a long ton is 2240 pounds

 

(WTO) World Trade Organization: The international organization which resulted from the Uruguay Round of GATT negotiations. The WTO seeks to establish global rules of trade between nations; its goal is to help trade flow smoothly, freely, fairly and predictably

Interested in our logistics services? Need further assistance & dedicated information?
Our SINO experts answer within 48h !

ALL YOU NEED TO KNOW ABOUT HS CODE

International trade is a tool to expand our markets for both goods and services that otherwise may not have been available for us. It is the reason why you can pick up between a Japanese, German or American car for example.

International trade plays a very important role in our daily life, for example if you walk into a supermarket and can buy south American bananas, Brazilian coffee and a bottle of south African wine, then you are experiencing the effect of international trade.

HS code definition:

 

HS Codes (or HTS Codes), also known as the Harmonized Commodity Description and Coding System, or simply the Harmonized System, are a standardized international system to classify globally traded products. The system was first implemented in 1988 and is currently maintained by the World Customs Organization. The HS Convention, signed in 1983, has over 200 member countries. As signatories, each country agrees to classify its tariff and duty structure according to the HS Code categories.

HS code is developed and managed by the World Customs Organization, the HS code

  • Consists of 5,000 commodity groups covered in 99 Chapters containing 21 sections
  • Is identified by a six- digit code that can be broken down into three parts
  • Is supported by well-defined rules with legal and logical structure to achieve uniform classification all over the world

hs code

 

To understand the meaning of HS codes, we will take 1704.90.10.00 as an example.

 

  • 17 relates to Chapter 17 of Section IV – Prepared foodstuffs; beverages, spirits, and vinegar; tobacco and manufactured tobacco substitutes
  • 04 relates to sugar confectionery (including white chocolate), not containing cocoa
  • 90 relates to confections or sweetmeats ready for consumption:
  • 10.00 relates to candied nuts

The first two digits (HS-2) identify the chapter the goods are classified in, e.g. 09 = Coffee, Tea, Maté and Spices. The next two digits (HS-4) identify groupings within that chapter, e.g. 09.02 = Tea, whether or not flavoured. The next two digits (HS-6) are even more specific, e.g. 09.02.10 Green tea (not fermented). Up to the HS-6 digit level, all countries classify products in the same way (a few exceptions exist where some countries apply old versions of the HS).

It’s very important to understand HS code because this code is used by various organizations, governments for different purposes:

 

  • Taxes
  • Trade policies
  • Quotas controls
  • Price Monitoring
  • Monitoring of controlled goods
  • Setting of freight and transport tariffs
  • Gathering of transport and trade statistics and economic research and analysis among other users

Attention: Every country has its specific HS code, there is no Global HS code. Each country can modify it by adding two or four digits. The first 6-digit numbers are supposed to remain the same across the entire world.

 

How to choose the right HS code

 

Sometimes let’s say that you customers may ask you to specify a 10-digit HS number on the commercial invoice. the 10-digit number you use for U.S. export purposes may be different than the 10-digit number they need to use in their country for their import purposes. Why are they different?

As we mentioned before the first 6 digits are uniform for all countries who agreed to the Harmonized System. However individual countries have the authority to add to the HS system to create 10-digit codes based on their individual taxes and needs. (Some countries use eight-digit codes; others use 12-digit codes.

Practical example:

 

Exporting umbrellas form the United states to Germany.

In the United states umbrellas are identified by the HS number 6603.20.3000. If you are exporting to Germany and you complete the commercial invoice using all digits of that code, the German importer’s paperwork will be refused. Because in Germany the right code for umbrella’s is 6603.20.0000.

 

What Happens in case of Using an Incorrect HS Code:

 

  • The product will be classified Incorrectly
  • The goods will be entered into another country under an incorrect classification number
  • The exporter’s certificate of origin will be prepared incorrectly
  • import clearance delays may occur.
  • The buyer may incur additional costs.
  • The importing country may begin an investigation.
  • Goods may be denied preferential duty treatment.
  • Penalty action may be taken.

 

Tips on How to determine the correct HS code.

 

  • The first step is to break down your products into specific groups, this step is critical to ensure efficiency and control of data. Note that in some cases there may be slight discrepancies between the HS code your supplier will use and the correct HS code in the country of import.
  • Product ruling is a type of public ruling under the Taxation Administration Act. It gives certainty to participants or potential participants on the tax consequences of an arrangement. It’s highly suggested to check the Ruling whether you are familiar with the product or not, because it constantly changes, and tariffs doesn’t necessarily keep up with technology.
  • Product specification is a document that provides critical defining information about a product and can include:
  1. identification of the manufacturer
  2. list of rules,
  3. bans and standards that apply to the item
  4. design specifications
  5. product images that visually illustrate the product

Conclusion:

 

As you can see HS code is a very important tool, that’s required at each import/export process. Mastering HS code is a key for easier shipments. By providing the right code from the first time you will be saving  time and money.

You can always ask for help from your Customs Broker or your Freight forwarder. Don’t hesitate to contact us for any further information or queries.

We are so glad to Share our Knowledge and expertise with you. By reading this article you already know much about HS code and we hope we answered to all your questions regarding HS code.

Interested in our logistics services? Need further assistance & dedicated information?
Our SINO experts answer within 48h !

shipping cargoes by ocean, air, or Rail freight ?

cargo types- containers

 

 

What is cargo (e.g freight) ?

 

Cargo consists of goods, materials, merchandise carried onboard of an aircraft, ship, train, or truck. Generally, it consists of goods for commercial gain on which an air waybill, or bill of lading or any other receipt is issued by carrier.

Shipments from point A to point B requires a lot of planning, the mode of transportation is considered as a key factor for successful planning. However, to determine the mode of transportation and the costs of shipment some elements must be taken into consideration:

  • Value of the goods
  • Weight and volume of the goods

Ocean Cargo

 

sea freight cargo

 

Sea freight accounts 85 % of the global trade, it’s the main shipping method for global import/export businesses.

Ocean cargo is considered as the best solution for large sized cargoes. Most of the time the size and volume of goods doesn’t fit in any other mode of transportation or is economically unviable to move by other modes of transportation than the ocean.

The main benefit of ocean freight is the low prices comparing to air or rail transportation. Another benefit of ocean freight is size and weight that may involve issues for air transportation.

In case of LCL load, it is possible that other shipments sharing the same container may cause a delay. Perhaps the cargo’s owner is missing paperwork or not delivered on time.

 

Ocean freight is preferred mode of transport for large goods (high weight and volume) and heavy cargo such as metals, minerals, iron, and bulk products such as crude oil and petroleum.

Environmental impact is Another factor to take into consideration. We are all taking care of the planet we live on. It seems that sea freight is gaining this category. CO2 emissions are much higher in air travel than ocean freight. This leads to the fact that the transport of goods by air has a much larger carbon footprint than the transport of goods by sea which are considered much greener transportation mode with a higher carrying capacity.

 

Key benefits of ocean freights:

 

  • Greater flexibility in the material that can be transported and for certain items, it can be the only economical choice.
  • Sea transport allows the shipping of greater quantity of materials due to its large storage capacity.
  • Most eco- friendly among other mode of transportation
  • Economical
  • Multiple carrier options for the shipper
  • Extensive coverage around the world

 

Air freight

 

Air cargo- shipping option

 

Air freight is a critical mode of transportation to meet the demand for growth, world air cargo shows an average growth of 4.2 percent per year.

High value goods are more likely to be shipped by air freight, like laptops, mobile phones because the shorter transit time decreases the risk of damage or theft. It takes less time to move goods from an airplane to another, more security cameras to keep an eye on the goods.

Air freight is a more expensive option and can be up to 6 times as expensive as ocean freight. However, air freight is much quicker than ocean freight.

Key benefits of air transport:

 

  • Fast transition
  • Less manipulation
  • Less documentation
  • Reliable arrival and departure
  • Increased security of your shipment

 

A key element in business “time is money”. So, does the cost of delivery by air increase by increasing speed? technology is constantly accelerating ocean delivery. This is done through better vessels, faster management resources and more accurate communication.

 

Rail Cargo

 

shipping by Rail- Rail cargo

 

Another “green” mode of transport is rail cargo, train consume less fuel per ton mile than trucks, also it requires only one driver for 100 wagons. Rail cargo is considered as a cheap mode of transportation. However, some additional costs are incurred in a rail journey. The additional costs consist of a road delivery and lift costs to transfer the goods from the road vehicle to the container.

Trains are able to carry a large number of containers from the delivery ports. Trains are also used to transport steel, wood and coal.

On average trains are used to transport large amounts of goods, and most of the time they have direct destinations which helps to avoid  problems like accidents, and road congestion.

By providing the right circumstances, Rail cargo is less expensive than trucking and energy efficient.

 Key benefits of rail freight: 

 

  • Reliable transit times and schedules
  • Railways are the most efficient of land transportation. A train can carry the equivalent of more than 400 trucks.
  • Fast and economical delivery over long distances. Generally more than 500 miles
  • Rail transportation is traditionally very safe.
  • Helps reducing road congestion.

Interested in our logistics services? Need further assistance & dedicated information?
Our SINO experts answer within 48h !

CARGO PACKAGING

Cardo packaging or freight packaging is one of the most important factors when it comes to shipping of the goods.

In every import/ export process there are two major challenges that faces shippers, it’s the satisfaction of both customer and shipper. The customer requires a secure and reliable method of carriage, so he can receive non-damaged goods, on the other hand the shipper requires that the space on his cargo is fully utilized in order to make maximum profit.

The main function of the packaging is to protect and preserve the goods during storage and transit. However, protection is not only required against the loss, damage and pilferage of the goods, but also depending on:

  • the nature of the contents, against moisture entering or leaving the package.
  • High or low temperatures
  • light,
  • gases,
  • insect infestation,
  • contamination and other natural hazards.
  • The dry cargoes embrace raw materials, semi-finished or finished goods. They do not require the same containment as gases and liquids

Most common cargo packing type:

 

Card board Boxes (Fiber board boxes):

 

The most common economical container for shipping continues to be the cardboard box. This is understandable as shippers seek efficient, but inexpensive and lightweight packaging. However, the usage of card board boxes is limited by:

  • the weight that it can withhold,
  • the incompatibility with common lifting equipment,
  • Extreme weather conditions that can damages card boards
  • Transport type
  • Regulations of the country of origin or destination

 

There are 3 different carton packaging:

 

  1. Corrugated carton:

It’s popular for their strength, durability, lightness, recyclability and cheap prices.  Due to the quality and safety of packaging items in corrugated boxes, they are commonly used in the food industry, clothes, books, plastic and other unbreakable goods.

  1. Double- walled corrugated carton:

It’s commonly used to crating. In case of moving furniture or other larger items, use quality styrofoam and bubble wrap around these areas, box items securely so there is no movement inside, palletize and use strapping to hold in place to ensure protection.

  1. Double carton:

This method of packaging is more often used for fragile items such as: glass, porcelain and smaller items that require special care. These items must be separately packaged by hand in a commercial bubble wrap. Then, these items are placed in an inner shipping box, which will then go into an actual shipping box of about 2 to 3 inches or more.

 

Bagged cargo:

The product itself must be durable to withstand external pressure and compression, because the bags will only hold the contents in one place and not protect against external damage. These products can usually be fertilizers, cereals (rice, corn, wheat), seeds, dried fruits, sugar, coconut, coffee, fresh vegetables, flour, copra, small items such as shells, raisins.

 

Wooden cases:

They have stood the test of time and their main advantage is that they have the strength of a wall to withstand imposed loads. They are more expensive than cardboard packaging because of the cost of wood. Wooden boxes are particularly suitable when the goods are transported by conventional methods and when they are sensitive to heat, humidity, etc. types of wooden crates, including plywood, increasingly used by exporters.

 

Wooden crates:

They are suitable for wooden packaging embedded in the skeleton. An open box can be used when the contents are elastic enough to require minimal packaging to facilitate handling and stacking. It is sometimes used as an outer packaging to consolidate cartons or to enhance the protection of cartons. The skeleton box is often used to transport large machines.

 

Steel drums:

New steel drums are generally excellent for export and delivery. Used drums, if not carefully restored and tested, can be a bad choice. Fatigue caused by thorn bumps and damage from previous closures, which makes your load vulnerable.

 

Bales:

A well-processed bullet is well developed in most export operations and shipments. However, all bullets can be subject to snagging holes and water damage. They are not recommended for high value products.

 

Palletizing Cargo:

Many products or commodities can be economically palletized to facilitate their handling, stowage, and protection. Packing cost may be significantly reduced by palletizing or unitizing.

There are six standard pallets that accommodate the various and/or intermodal containers presently used in international commerce. The normal sizes (in inches) of these six standard pallets are:

 

  • 1016 x 1219 mm (40″ x 48″) North America
  • 1000 x 1200 mm Europe, Asia
  • 1165 x 1165 mm Australia
  • 1067 x 1067 mm (42″ x 42″) Worldwide
  • 1100 x 1100 mm (43″ x 43″) Asia
  • 800 x 1200 mm Europe

 

Standard pallets are rated for 40 “x 48”, and the goods must not exceed the pallet or exceed a height of 8 feet. Special pallets must be made for items larger than 40 “x 48”. For loads over 7 feet, a loader is required to unload the load. If your cargo weighs less than 150 pounds, and your company does not have a docking station, the loading may be broken and unloaded manually.

 

Packaging dangerous goods:

Learning to pack dangerous goods requires a lot of attention to detail and diligence. Many dangerous goods have extremely detailed specifications regarding the type or method of packaging to be used to ensure the safety of the goods during transport. And these packaging requirements can also vary considerably depending on the mode of transport used to ship the goods.

3 questions you should ask yourself before shipping dangerous goods:

  • What type of packaging is suitable for this shipment?

It is always necessary to use USOT approved packaging for each shipment of dangerous goods. Compliance with the DOT rules will ensure the safety of the packaging of dangerous goods. concerning the packaging process, this will largely depend on the class of dangerous goods you work with.

  • Are the dangerous goods being transported safely?

For all transport of dangerous goods by sea, air and land, rules govern the standard safety methods for efficient transport. All dangerous goods carriers must provide comprehensive training to all employees handling, packing or transporting dangerous goods.

  • Is the company in compliance with all relevant regulations?

Transportation of the hazardous materials industry is based on DOT, the International Air Transport Association (IATA) and other international organizations to establish regulatory standards and ensure the safety of everyone involved in this industry. Your company should be aware of all applicable rules in order to remain in full compliance with these examples. If you do not do this, your staff is at risk and may result in fines.

Interested in our logistics services? Need further assistance & dedicated information?
Our SINO experts answer within 48h !

MARINE INSURANCE FOR CHINA AND GLOBAL FREIGHT

Insurance in general is the “Protection against future loss”. insurance is available to ships, boats and most importantly the cargo that is being carried into any mode of transportation.

Marine insurance is very important because among the four mode of transportation ( road, rail, air and water) ocean cargo is more likely to cause a lot of concerns to carriers, not only because there are natural phenomena that can affect the cargo and the ship, but also other incidents and signs that can cause significant damage to the carrier and the transport company.

The main advantage of marine insurance is that the carrier may choose an insurance plan depending on the size of the vessel, routes taken by the vessel for the carriage of cargo and many other secondary points that can significantly affect the carrier in general.

In addition, since various plans and policies indicate not only covering the cargo, but also the vessel. the carrier can choose and use the policy that suits him and his business.

China is leading the maritime insurance:

 

The rapid growth of China’s maritime trade has led to the development of its insurance sector, in which significant steps have been taken in recent years to raise standards.

China is currently the largest cargo insurance market and the second largest home insurance market, mainly due to China’s strong economic growth since the country was added to the organization. world trade.

 

Why you should purchase cargo insurance:

 

Many are trying to save money by not insuring their cargo, but here’s five of the many reasons why you should take insurance into consideration.

  • Reduce exposure to financial loss

If you are an exporter who has not been paid for the goods at the time of shipment or an importer who has paid for all or part of the goods before they are received, you risk a financial loss if the goods are lost or damaged during transit.

  • General average – Expedite the release of your cargo

You may need to send a security deposit and / or cash deposit in order to receive an average release of your cargo, even if there is no loss or damage to your property. By taking out insurance, your insurance company takes responsibility for this and speeds up the clearance of your shipment. The overall average value is the generally accepted international principle that if a ship has certain types of accidents, all parties share the loss equally.

  • Contractual requirement

In your sales contract, you may need to purchase marine insurance to protect the interests of the buyer or their bank. This is especially true when selling CIP or CIF products. Failure to comply with this requirement may result in financial loss if the product is lost or damaged. However, failure to comply with the terms of your contract with the buyer can lead to loss of sales and legal problems.

  • Coverage for limited carrier liability

Under the law, carriers are not responsible for many common causes of loss occurring during transit (eg natural disasters, common features, etc.). And, even if they are responsible, the carriers’ liability for loss is limited – either by contract in the bill of lading or by law. In most cases, you will only recover cents from the carrier.

  • Have more control over insuring terms

Reliance on the insurance of the buyer or seller may be a viable option, but you must be sure that the insurance was purchased, and that the conditions, cost and insurance limits provided by each insurer for each dispatch meet your needs. And, if the requirement is for a foreign insurance company, perhaps in a different language, it can take a lot of time and disappoint. If there is a problem with claims, you often deal with foreign courts.

CIF + 10%

 

(Commercial invoice value + insurance costs + freight= CIF value x 110% (10% for any unforeseen costs or charges))

This type of insurance covers your shipping costs too in the case of damage or loss where the repair or replacement must be done somewhere other than the consignee’s location. Recoverable freight charges may be prorated based on the portion of the shipment damaged in the case of partial loss/damage.

If there is damage and the repair occurs at the final destination of the goods (consignee’s facility), no freight charges are refundable.

Practical demonstration:

 

For most destinations and commodities PWS sells insurance for $0.60/$100.00 insured value with a $12.00 minimum.

Sample insurance of goods + freight charges:

Commercial Invoice value = $10,000.00

Insurance Cost = $60.00

Freight Cost: $500.00

Total CIF Value = $10,560.00 x 110% = $11,616.00 = Amount to Insure

 

 

What does the cargo insurance covers?

 

  1. Perils of the sea:

– natural disaster

– Accidental accidents

  1.  Ocean Losses and costs 

– ocean Loss

– Ocean cost

– Sue and labor costs

– Rescue costs

– The degree of loss of property can be divided into total losses and partial loss.

– By the nature of the loss of goods it can be divided into general average and particular average

–  Determination of the total average and average

– General Average Conditions

–  The difference between a general average and a particular average: the cause and the responsibility are different.

– Total average contribution

  1. Exclusion of an insurance company

– Intentional actions or loss of policyholder’s negligence

– Responsibility for losses is borne by the shipper

– Loss of poor quality or small assets before insurance liability is valid.

–  Losses of the insured property, natural losses or defects, characteristics and reduction of the market price, losses and costs caused by delayed transportation.

 

Important to know !

 

There are five exceptions that a motor carrier can use to deny liability for freight claims. The burden of proof is on the motor carrier to prove that one of these five conditions was met and that cargo damage was not due to their negligence.

 

Act of God:

 

Act of god defense is applied when the carrier can prove that the damage was caused by a physical phenomenon or a natural disaster that he cannot control. Some examples: the wind blows on a trailer, a tornado or a flood, or a driver has a heart attack.

All weather conditions are not considered “Act of god” in accordance with the Carmack Law. The violation must be of such unexpected strength and seriousness that the carrier could not take protective measures against it.

As stated in Standard Brands, Inc. c. Nippon Yusen, the carrier may be liable for any transport claims arising.

 

The “public enemy” or the “act of war”:

If the damage is caused by hostile acts of the armed forces that are enemies of the government, the carrier cannot be held responsible for cargo claims. War crimes fall under this exception, but organized crime does not exist. Terrorism may be part of this exception, but there is currently no case law to determine how the Carmack amendment will be applied in such situations.

 

Act of public authority:

The Carmack Amendment is another exclusion of carrier’s liability if the government (“public authority”) damages the transportation. Under this exemption, policies such as quarantine, road closures, product recalls or trade embargoes are applied.

 

Inherent vice:

A good with an “inherent vice” is that it is naturally subject to defects, disease or degradation, which can worsen over time. Examples of such products include fruits and vegetables, cheese and tobacco.

 

It is incumbent on the carrier to demonstrate that the damage was caused solely by the “inherent vice” in the goods and not by their own negligence, for example, failure to comply with the shipper’s instructions for processing.

 

Act of shipper:

Act of shippers are mostly associated with improper loading or packaging. However, the general principle is that the shipper’s error may not be obvious under normal observation; if so, the carrier is obliged to refuse shipment.

Interested in our logistics services? Need further assistance & dedicated information?
Our SINO experts answer within 48h !

Incoterms

Incoterms 2010- premium guide- 11 terms description

Incoterms – Importing from China

 

Incoterms are rules that allows buyers and sellers to identify the responsibility of each one. It allows the parties to identify a point where the costs and risks of transportation are precisely divided between both of them.

Incoterms e.g (International commercial terms) Has a set of 11 international standard trade terms which last version is Incoterms 2010.

Incoterms also coordinate responsibilities for Customs clearance/ duties between the parties.

In other words, incoterms Are essential in every import/ export process, it’s a tool used by freight forwarders to facilitate the shipping process.  It defines who will arrange for carriage, who will pay for the carriage, who will break risk of loss or damage to goods.

Incoterms are associated with freight charges, they are used as a convenient way of confirming the role of each party ( who will pay the various charges during international transport). They are frequently used by freight forwarders and carrier when issuing freight quotations or clarifying who should pay the fees. However, incoterms cover a much wider range of responsibilities and obligations for sellers and buyers. Each incoterm has its proper rules and responsibilities that defines the role of each party.

The chart below demonstrates the exact responsibilities and charges of the buyer and seller according to incoterm 2010. The chart defines the following information:

  • Obligations of the buyer and the seller
  • Which party handles insurance, permits, and permissions
  • At which point costs and risks are transferred from the seller to the buyer

Incoterms 2010 by the international chamber of commerce

 

 These rules Are identified by the ICC ( international chamber of commerce, which is the source for any freight forwarder and in case of any issue the ICC should be your first resource for information

 

The eleven terms – Premium Guide

 

Everyone who works in import/export should know all the incoterms; (International commercial terms). It’s subject that helps not only traders but more importantly lawyers, Transporters, and insurers.

Before going into details, you have to know that the eleven terms can be divided into 4 parts:

  1. Departure
  2. Main carriage not paid by seller
  3. Main carriage paid by seller
  4. Arrival

 

Now let’s categories the 11 terms into these four groups:

  1. Departure:

 

EXW – EX works

Means that the seller fulfills his obligation to deliver when he has made the goods available at his premises 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 must carry out all tasks of export & import clearance. Carriage & insurance is to be arranged by the buyer. This term thus represents the minimum obligation for the seller.

 

  1. Main carriage not paid by seller:

FCA – Free Carrier

Means that 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 the parties are well advised to specify as clearly as possible the point within the named place of delivery, as the risk passes to the buyer at that point.

 

FAS- (Free Alongside ship)

Means that the seller fulfill his obligation to deliver when the goods have been placed alongside the vessel, the quay, or in the lighters at the named port of shipment.

The seller is required to clear the goods for export.

The buyer has to bear all costs and risks of loss or damage to the goods from that moment.  This term is only used for ocean transport only. FAS is applied for bulk cargo.

 

FOB – Free on board

Means that the seller fulfills his obligation when the goods pass 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 seller must clear the goods for export. This term can only be used for ocean transport. If the parties do not intend to deliver the goods across the ship’s rail, the FCA term should be used.

Incoterms 2010 rules advised to use FCA instead of FOB, because the containers are delivered regularly in the port’s container terminal and not loaded onto the ship. But in practical work, almost all the Chinese supplier will use FOB instead of FCA.

 

  1. Main carriage paid by seller:

 

CFR- cost and freight

Means that the seller must pay the costs and freight necessary to bring the goods to the named port of destination. The risk of loss of or damage to the goods passes when the goods are on board the vessel.

The seller must contract for and pay the costs and freight necessary to bring the goods to the named port of destination. The CFR term requires the seller to clear the goods for export.

This term can only be used for sea and inland waterway transport.

 

CIF_ cost, insurance and freight

Means that the seller delivers the goods on board the vessel or procures the goods already so delivered. The risk of loss of or damage to the goods passes when the goods are on board the vessel.

The seller must contract for and pay the costs and freight necessary to bring the goods to the named port of destination.

The seller also contracts for insurance cover against the buyer’s risk of loss of or damage to the goods during the carriage.

The buyer should note that under CIF the seller is required to obtain insurance only on minimum cover.

However, if the buyer wishes to have more insurance protection, he will need either to agree as much expressly with the seller or to make its own extra insurance arrangements.

 

CPT- carried payed to

Means that 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.

“Carrier” means any person who, in a contract of carriage, undertakes to perform or to procure the performance of carriage, by rail, road, sea, air, inland waterway or by a combination of such modes.

If subsequent carriers are used for the carriage to the agreed destination, the risk passes when the goods have been delivered to the first carrier.

The CPT term requires the seller to clear the goods for export.

This term may be used for any mode of transport including multimodal transport.

 

CIP- carriage and insurance paid to

This term is the same as CPT with the exception that the seller also has to procure insurance against the buyer’s risk of loss or damage to the goods during the carriage.

However, if the buyer wishes to have more insurance protection, he will need either to agree as much expressly with the seller or to make its own extra insurance arrangement This term may be used for any mode of transportation.

 

  1. Arrival:

 

DAT- Delivered at terminal

Seller pays for carriage to the terminal, except for costs related to import clearance, and assumes all risks up to the point that the goods are unloaded at the terminal.

 

DAP- Delivered at place

Seller pays for carriage to the named place, except for costs related to import clearance, and assumes all risks prior to the point that the goods are ready for unloading by the buyer.

 

DDP – Delivered duty paid

Means that the seller fulfils his obligation to deliver when the goods have been made available at the named place in the country of importation.

The seller has to bear the risks and costs, including duties, taxes and other charges of delivering the goods thereto, cleared for importation.

Whilst the EXW term represents the minimum obligation for the seller, DDP represents the maximum obligation.

The 11 terms can be also divided into 2 groups:

  • Waterway transport: FAS, FOB, CFR, CIF
  • Any mode of transport: EXW, FCA, CPT, CIP, DAT, DAP, DDP

 

The five Most commonly used incoterms

 

FOB – Free On Board (named port of shipment)

  • Loading at the sellers’ facility whether onto truck, train or barge = Sellers’ responsibility
  • Pre-carriage – those freight charges that arise from moving goods from the sellers’ origin to the port or airport = Sellers’ cost and responsibility
  • Loading to vessel = Sellers’ responsibility
  • Principle carriage (ocean carrier) = Buyer is responsible for cost and any loss or damage while in transit on the ocean carrier.

 

 EXW – Ex Works(named place)

the key thing to know about EXW? All charges incurred for transportation of the goods are the responsibility of the buyer and transfer of ownership happens as soon as the goods leave the floor of the seller’s facility.

Incidentally, this is the most common term encountered when importing goods from the EU and applies exclusively to containerized or multimodal transport as well as air, rail or road.

 

CFR – Cost and Freight (named port of destination)- ocean shipment

 

  • Loading at the sellers’ facility whether onto truck, train or barge = Sellers’ responsibility
  • Pre-carriage – those freight charges that arise from moving goods from the sellers’ origin to the port or airport = Sellers’ cost and responsibility
  • Loading to vessel = Sellers’ responsibility
  • Principle carriage (ocean carrier) = Seller is responsible for cost but the Buyer is responsible for any loss or damage while in transit on the ocean carrier.

 

CIF – Cost, Insurance and Freight (named port of destination)- maritime or ocean shipments

 

  • Loading at the sellers’ facility whether onto truck, train or barge = Sellers’ responsibility
  • Pre-carriage – those freight charges that arise from moving goods from the sellers’ origin to the port or airport = Sellers’ cost and responsibility
  • Loading to vessel = Sellers’ responsibility
  • Principle carriage (ocean carrier) = Seller is responsible for cost but the Buyer is responsible for any loss or damage while in transit on the ocean carrier.
  • Ideal for containerized shipments

 

DDP – Delivered Duty Paid (named place)

 

This term means the seller is responsible for all charges involved in bringing the goods from the sellers’ facility or point of loading to the final place of destination. This includes all charges associated with freight, customs clearance, duties and taxes.

 

Understanding and using Incoterms effectively is important, and every importer has unique requirements. Before concluding a sales contract, we recommend that you consult our complete list of incoterms and consult your lawyer. Remember that your freight forwarder must do more than just offer a good price.

Interested in our logistics services? Need further assistance & dedicated information?
Our SINO experts answer within 48h !

HOW TO GET AN EORI NUMBER ?

EORI (Economic operators Registration and identification), is a numbering scheme specific to the European Union. If you are not based in Europe you don’t need an EORI number. But if you are based in an EU country you should read the following.

EORI is mandatory for companies and individuals who are carrying out custom activities in the European Union.

An EORI number consists of an ISO country code (EU member state)  followed by 12 digits number and maximum of 15 digits. It is based on the trader’s VAT number. For Germany it can look like this DE5512345678.

EORI number is required to provide information for goods both at pre-arrival or pre-departure or is engaged in import and export of goods under a transit process.

How to apply for an EORI number:

 

The application process consists of filling an application form online. However, the application form varies from an individual to another depending if the individual is:

  • Registered for value added tax (VAT).
  • Not VAT- registered and the individual is exporting.
  • Not VAT – registered and the individual is importing.

The application form you will fill in depends on the country you are in.

Format of the EORI number:

 

There are two forms of EORI number:

  • For companies or individuals registered to VAT, the EORI number will begin with two letters GB for UK. The number is then followed by 12 digits.
  • Dummy numbers can be issued for non- VAT – registered operators. The number will be smaller than the usual EORI

There can be one EORI number per trader, regardless the number of offices that may have. Each office will have its own EORI number.

Office 1: GB 123456789015

Office 2: GB 123456789016, it can continue depending on the number of offices.

 

Consequences of not having an EORI number:

 

In case you didn’t apply for an EORI number, the customs authorities will hold your cargo until you apply for an EORI number.

They will not impose any penalty or destroy your cargo that you have imported from china or any other county. However, it’s always advisable to have an EORI number before any import process.

In case you didn’t apply in advance, the best solution will be to apply before the shipment has departed from the country of origin.

Does the EORI number applies to any mode of transportation?

 

YES, an EORI number is mandatory in every import/ export process, regardless of whether you are getting your imported products delivered by sea Freight or Air Freight you should get an EORI number.

 

DOES EORI number concerns non- registered companies?

 

EORI number is mandatory for any import process regardless whether you are registered or not. In many European states you are not required to register a company n order to perform commercial activities. Therefore, you must have an EORI number even if you are importing as an individual.

 

How to apply for an EORI number?

 

The EORI number is provided by the customs authorities in which you or your company reside. You can either apply online all fill a form an send it by mail or fax to the customs. Below you will find a list of links to different websites of EU customs authorities for more information on the application:

Austria Belgium Bulgaria
Croatia Czech Republic Denmark
Estonia Finland France
Germany Greece Hungary
Ireland Italy Latvia
Lithuania Luxembourg Malta
Netherlands Poland Portugal
Romania Slovakia Slovenia
Spain Sweden United kingdom

Check that you are registred and your EORI number is valid,

Interested in our logistics services? Need further assistance & dedicated information?
Our SINO experts answer within 48h !

BILL OF LADING- B/L – EASY UNDERSTANDING

A bill of lading also known as BOL or B/L, is a document issued by a carrier to a shipper, to prove that goods have been received on board and ready to be shipped to the consignee to a named place for delivery.

The Bill of lading is an evidence to:

  • Confirm valid contracts between the consignor and the carrier.
  • Confirm that the good matches the description and that the goods are in a good condition.
  • It is also a document the governs all the legal aspects of physical carriage, also known as document of transfer, that is negotiable and can be used to transfer the ownership of the goods for the initial owner to another.
  • In case a Letter of Credit is acquired, a clean B/L is required by the banks as a prove.

Basic elements that must be included in a B/L.

  • Name of the shipping company
  • Flag of nationality
  • Shipper’s name
  • Order and notify party
  • Description of goods
  • Gross/net/ weight
  • Total weight and volume of the goods

 

What information should be included in a bill of lading?

 

  • Names and full address of the sender (shipper) and receiver (consignee).
  • The date of the expedition (shipment).
  • The number of shipping units.
  • Freight classification.
  • The exact weight of the shipment. If there are several loading units, the weight of each item must be indicated.
  • Type of packaging, including cartons, pallets, pallets and drums.
  • A description of the submitted item includes the manufacturing material and the usual name.
  • Order numbers or special account numbers used between companies to track orders
  • Special instructions for the carrier.
  • A note if the cargo is a dangerous material from the Department of Transportation. (Special rules and requirements apply when shipping hazardous materials.)
  • The declared value of the freight sent.

 

3 major Roles of a bill of lading:

 Receipt of the good

Evidence of the contract between carrier and shipper

Document of title that can be transferred from the named owner to another holder

 

Keep in mind that each shipping line or airline has its own B / L format, but the parts that need to be filled are almost the same. Learning from this template form will be sufficient for you to complete or understand a B / L for your cargo shipment work.

 

bill of lading

 

Bill of Lading in details: 

 

B/L is one of the most important documents in the whole shipping and freight chain, that needs to be filled up.

Here you will find the B/L elements explained in detail. In case you are having problems with filling some of the elements the following will guide you.

 

  1. Shipper

Is the name and address of the sender (shipper) that sends the load. This may or may not be the actual owner or manufacturer of the cargo, but it may also be a trader or freight forwarder depending on the type of B/L, but it may also be different from the cargo exporter.

 

  1. Consignee

This is a key entity in the shipping chain. This field indicates the name and address of the person or company legally authorized to receive the cargo covered by the bill of lading.

This may or may not be the owner or consignee of the shipment, provided it is a bank, merchant or cargo agent, depending on the type of bill of lading issued.

The name of the consignee in the bill of lading also carries the risk and responsibility of being held responsible for many issues, such as lack of clearance of goods, late customs clearance, claims.

  1. Bill of Lading Number

 is the unique number provided for the covered shipment in a specific bill of lading. This is assigned by the shipping line and must be quoted by the customer for any request, shipping information, arrival information, claim

 

  1. Reference numbers

this space can be used to update specific reference numbers of clients or forwarders that they will use to track their shipments.

 

  1. Carrier agents

Here, the contact details of the discharge port agents are generally recorded in the shipping line, so that the destination agent / freight forwarder of the customer can communicate with the agents of the shipping line to request the status of the shipment or go for release.

 

  1. Pre-transport by

Assume that there is an inland point which is connected to the mainland port by means of a feeder (connecting) vessel, the name of that feeder vessel is shown here. Most of the times, it’s blank.

 

  1. Place of Receipt

 This is the place where the cargo is handed over by the shipper or his agent to the carrier (shipping line) or its agent.

  1. Port of Loading  

This is the place from which the container or cargo is loaded by the carrier onto the nominated Ocean Vessel

 

9.  Ocean Vessel/Voyage

This is the name of the vessel and the voyage number that carries the container or cargo from the (mainland) Port of Loading (example Durban) to the Port of Discharge (example Mumbai).

  1. Port of Discharge 

This is the place at which the container or cargo is discharged by the carrier from the nominated Ocean Vessel.

 

  1. Place of delivery 

This is the final destination of the container or cargo. If this zone is full (example: ICD Bengaluru), this means that the carrier has undertaken to move the container or the cargo from the port of discharge to the place of delivery.

Again, as for the place of reception, the shipping line must be careful not to indicate anything in this field, as it will be responsible for the delivery of the container or the cargo in good condition and at this place of delivery.

  1. Marks & Numbers

Marks & Numbers are important information in a shipment. The shipper marks his packages with some information identifying the shipment so that the consignee can know what the shipment is. The marks and numbers can have any of below:

  • the consignees name and address
  • the purchase order number
  • the number of the package – 1 of 32 for easy identification
  1. Description of packages and goods

This area is used to describe exactly what cargo is being loaded in the container or LCL. Generally other information like number of packages, freight conditions, HS code are also mentioned

 

14. Gross Weight

This is the weight of the cargo that is packed in the container or loaded on board. This is generally only the weight of the cargo + the weight of the packaging and does not include the tare weight of the container.

Types of Bill of lading according to the mode of transportation

 

Ocean transportation

 

ocean freight

 

An ocean bill of lading is issued when goods are transported by ship.

Ocean freight to or from the U.S. is regulated by the Federal Maritime Commission (FMC)

4 common ocean Bill of lading:

 

  • Straight bill of lading:
  1. non-negotiable bill of lading which is consigned directly to the buyer
  2. The carrier will issue three bill of lading, in which one is endorsed by the consignee
  3. the straight Bill of lading is issued if the buyer didn’t pay yet for all or part of the goods.

 

  • Order Bill of Lading:
  1. Negotiable form of lading which is addressed to order of a party, instead of being consigned to the buyer.
  2. The Holder of the order Bill is generally the owner of the goods that being shipped
  3. Commonly used when the purchase of goods is under a letter of credit, or if the goods are being traded on a mercantile exchange while the shipment is being in transit.

 

  • Electronic telex release:
  1. Eliminates the need for an original B/L at the arrival destination for the release of goods
  2. The original B/L will be endorsed by the shipper to the carrier’s agent at the origin place. The agent at arrival destination will be notified by the origin agent.
  3. The notification of B/L is done electronically by email or integrated system
  4. The Electronic telex is used in case the buyer owes all or part of the goods, but pays before the arrival of cargo

 

  • Express bill of lading:
  1. Non- negotiable document, and no original bills of lading are issued
  2. The carrier releases the merchandise to the named consignee or notify party
  3. The express B/L is commonly used is case the importer has payed in advance for his goods, or in case he has credits with the supplier.

 

Air transportation

 

air freight

 

Air waybills (AWB) are issued when goods are transported by air.

AWB are non-negotiable bills, which means one the cargo is landed at the arrival destination, it is immediately delivered to the consignee or to the customs broker for custom clearance and final delivery.

 

Air waybills are evidence for:

 

  • Contract of carriage
  • A cargo receipt to prove that the carrier has received the shipment
  • Delivery guide, in case of a special handling

 

IF the goods are being shipped under a letter of credit for payment, or through the shipper bank to receive payments, the AWB may be consigned to a bank and the consignee must pay the bank who in return will provide a bank release to the airline to release the goods.

This process typically takes several days during which the goods will sit at the airline warehouse and possibly incur storage charges.

 

 

Land transportation waybill

 

 

land freight

 

A document issued by a carrier that provides details and instructions for shipment of goods. It includes the name of the sender (consignor) and recipient (consignee), the point of origin of the shipment, its destination, and the route are displayed.

  1. Widely used in north America for overland shipments
  2. Short form contract of carriage that refers to terms and conditions in the carrier’s tariff
  3. A waybill is a non-negotiable bill and is never consigned “to order”

Uniform Bill of Lading

 

A uniform bill of lading is an agreement between an exporter and a carrier regarding property to be transported. The uniform bill of lading provides basic information about the shipment such as the shipper and recipient’s names and the shipment’s origin and destination.

In addition, the document establishes the terms of the carrier’s liability, transport time frame, how to file a claim for a lost or damaged shipment, how insurance will be applied in the event of a claim and how the shipment may be stored or disposed of if the shipment is refused or is not deliverable

 

Hang Tag

 

The hand tag is typically used when a truck driver shows up at a shipping dock or door for cargo pickup and fills in a form by hand – hence its name.

  • Short form contract, with a brief note of certain terms and conditions.
  • It is covered by the carrier’s liability limiy and refers to the carriers underlying tariff.

 

the hand tag is frequently used in the air freight and local carriage business by courier services and other electronically dispatched trucks that are hired to pick up cargo from shippers who did not prepare a uniform waybill for the driver to sign as a cargo receipt.

Interested in our logistics services? Need further assistance & dedicated information?
Our SINO experts answer within 48h !

ALL YOU NEED TO KNOW ABOUT ISF – US IMPORTERS

 

 Importing to USA: “Importer Security Filing” ISF 10+2

Before merchandise can be imported into the United states the importer security filing (ISF) also called customs broker must submit electronically the 10+2 data elements to Customs at Border protection (CBP) no later than 24 hours prior to the cargo being loaded.

ISF required Elements (10+2 data Elements)

Who provides what?

 

  • 10 elements must be submitted electronically by ISF Importers, or their agent no later than 24 hours before the cargo is shipped to the US.
  • 2 elements must be submitted electronically by the carrier.

 

List of the 10 Elements required by the Importer

1.Seller (Name & Address) 6.Importer of record NO (EIN or SSN)
2.  Consolidator (Name & Address) 7. Ultimate consignee NO (EIN or SSN)
3. container stuffing location ( Schedule & Address) 8. Manufacturer (Name & Address)
4. Buyer ( Schedule & Address) 9. HTS Number
5.Ship to ( Name & Address) 10. Country of origin

 

Below you will find Details regarding the 10 elements

  1. Seller Info

ISF filer must provide the complete name, address, city, state, zip code, telephone, fax number, and email address of the seller.

  1. Consolidator/ stuffer

ISF filer must provide the complete name, address, city, state or province, postal code, telephone and fax number of the person or company that loaded the imported cargo into the container.

 

 

  1. Container stuffing location

ISF filer needs to provide the complete name, address, city, state or province, postal code, telephone and fax, number of the person or company that loaded the container.

 

 

  1. Buyer

Name and address of the last known entity to whom the goods are sold or agreed to be sold.

  1. Ship to

ISF filer needs to provide the complete name, address, city, state, zip code, telephone and fax number of the first person or company that will be receiving the imported cargo imported to the united states.

 

 

 

  1. Importer of record No. (IOR)

IOR is the person or organization that is responsible for all  paperwork and other formal documents required to enter imported goods to the USA.

It consists on providing the appropriate entry documents for clearance through Customs Border Protection (CBP) at US ports, payment of any duties, levies or fines, product classification and certification and any other obligation.

  1. Ultimate consignee

Full name, address, employer identification number or CBP assigned number and social security number of the party on whose account the goods are being shipped.

  1. Manufacturer

Name and address of the manufacturer that assembles, produces or grows the commodity. Or the name and address of the supplier of the finished goods in the country from which they are leaving.

  1. (HTS-US) code “Harmonized Tariff Schedule of the United states code”

HTS code Is a specific 10- digit import classification system to the United states. HTS codes, also called HTS numbers are administrated by the US international trade commission (ITC).

 

 

  1. Country of origin

Origin of the products, where they were produced, manufactured or grown.

 +2 data elements which are entirely the responsibility of the carrier:
  1. Vessel stow plan
  2. Container status messages

 

 

ISF facts:

 

The consequences of non- compliance with the ISF 10+2

 

There are four types of non-compliance:

  • Not making the declaration.
  • Making a mistake or submitting an incomplete declaration.
  • Submitting a declaration after the deadline.
  • Not cancelling a declaration in case, the cargo changes destination or it is abandoned

 

 

such as:

  • The percentage of incorrect declaration.
  • Measures taken by the importer to rectify the non-compliance.
  • Circumstances beyond the control of those making the declaration
  • Incorrect information having been supplied by someone in the logistics chain.

 

 

  1. The safe port requires the department of Homeland security to collect the 10+2 information by an Automated Targeting System that helps customs to analyze shipment information that helps customs to decide which containers needs more examination and which can move on without additional Checks.

 

 

  1. 10+2 elements must be submitted 24 hours at least prior to cargo loading at the port of lading. However, only two elements can be submitted while the vessel is still on the water, but no later than 24 hours prior to arrival. The container stuffing location and consolidator name and address
  2. Liquidation penalty of $5000 per violation in case of an inaccurate or missing document, it’s the importer responsibility to ensure that the ISF is filed and accurate.

 

  1. THE B/L should match your ISF to be approved. Such cargo shipment will be marked as non-compliance to ISF.

Most frequent Q&A

Q1: Can a Customs Broker be an agent for all of our ISF’s for a full year?

A: No. Each ISF is done on an individual basis. An ISF importer file the ISF themselves or hire an agent for each individual filing. There is no limit as to how many different agents an ISF Importer may use during the course of a year.

Q2: Does the ISF Filer need to be located in the US?

A: NO

Q3: Does the “filing agent” for the importer have to be a Licensed Customs Broker?  Can it be the foreign freight forwarder

A:  A filing agent does not have to be a customs broker except for the case of a “unified filing.”  A foreign freight forwarder can also be a filing agent.

Q4: When do we have to stop amending the ISF?

A: The Importer Security Filing must be amended if there is a change or more accurate information becomes available before the goods enter the limits of the port of first arrival in the United States.

However, if the flexible filing option (“FR”, “FT” or “FX”) is used, the ISF MUST be updated with the correct or more accurate information as soon as it is known, but in any event no later than 24 hours prior to arrival of the vessel in the first U.S. port. If better information does not become available and/or the original information is the best information, the ISF must still be completed using the “CT” amendment code

Q4: Are changes to the ISF after arrival at the port of discharge allowed or required?

A: Generally, the requirement to update an Importer Security Filing terminates when the vessel calls at the U.S. port of arrival.  However, CBP will not restrict updates outside of this window

Q5: What happens if I fire my ISF Agent, but still need to update my ISF?

A: If an ISF Importer needs to update its own ISF that was initially submitted by its agent, the ISF Importer must contact a CBP Client Representative to have the original filing cancelled.  After the original ISF has been cancelled by the CBP Client Representative, a new ISF may be submitted.

Q6: How will importers be able to amend the security filing if they don’t have access to the Importer Security Filing elements in CBP systems?

A: If the ISF Importer used an agent to perform the filing, the ISF Importer should contact its agent for assistance in amending the ISF.

Q7: How do I handle shipments sold on the water?

The ISF will need to be updated if the shipment is sold in transit.  At a minimum, the ISF Importer must notify CBP that the goods have been sold, and the party must update the Buyer (Owner) field and any other field that the party knows has changed as a result of the sale.  The ISF Importer remains liable for the timing and accuracy of the ISF filing.

Q8:  Can I amend the bill of lading number on the ISF?

Yes.  From a transactional standpoint, the system will allow an ISF Filer to update an existing ISF with a new bill of lading number.  However, the ISF Importer is ultimately responsible for the timely, accurate, and complete submission of the Importer Security Filing.

 

Withdrawals:

 

Q9: What happens if I enter an ISF and then the shipments do not ship?

A: Withdraw the ISF by deleting it.

Q10: Will you allow the entry to update the ISF?

No.  Stand-alone ISF transactions can only be updated by replace transactions.  Furthermore, unified entry transactions will only update the ISF if the entry is replaced along with an ISF replace transaction.

 

Codes:

 

Q11: CBP should create detailed amendment codes so changes to the ISF can be tracked more easily.

CBP agrees and will post a list of amendment codes, once they have been fully developed, in the next set of implementation guides.

 

Recommendations:

  1. It’s very important to know what type of goods you are importing and to identify the proper HTS Numbers Before you import to the US.
  2. For ISF you can choose who will transmit and send necessary documents to related party.
  3. The process would be much easier if you keep communicating with your suppliers in China or any other country and with ISF filing agent or service provider.
  4. In case of door to door service, we will oversee all the process. Our team will be available for any inquiry.

Interested in our logistics services? Need further assistance & dedicated information?
Our SINO experts answer within 48h !