Air Freight Glossary
An AWB is a bill of lading which covers both domestic and international flights transporting goods to a specified destination. Technically, it is a non-negotiable instrument of air transport which serves as a receipt for the shipper, indicating that the carrier has accepted the goods listed therein and obligates itself to carry the consignment to the airport of destination according to specified conditions. Normally AWB refers to the Air Waybill issued by carrying airlines and also called Master Air Waybill (MAWB) which comes with three digits of numeric airline identification codes issued by IATA to non-U.S. based airlines and Air Transport Association of America to U.S. based airlines. However, air freight forwarders also issue HAWB (House Air Waybill) to their customers for each of the shipments.
A unit load device (ULD) which links directly with the airplane cargo handling and restraint system.
A term used to describe blocked space by airlines on behalf of forwarders/shippers.
All Risks Coverage, a type of marine insurance, is the broadest kind of standard coverarge, but excludes damaage caused by war, strikes and riots.
Actual Time of Arrival, or Airport-To-Airport, or Air Transport Association of America.
Actual Time of Departute.
The Customs Service authorizes bonded warehouses for storage or manufacture of goods on which payment of duties is deferred until the goods enter the Customs Territory. The goods are not subject to duties if reshipped to foreign points.
For consolidated air freight, it is moved under one MAWB and each consignment designated to specific consignee or receipant is under one HAWB. When freight forwarder receives the consolidated cargo from carrier, they will break the consolidation apart per HAWB then proceed customs clearance along with associated shipping and import documents. Such Break-Bulk is normally handled by airlines or their contracted ground handling agent.
A customs document permitting the holder to carry or send merchandise temporarily into certain foreign countries for display, domonstration or other purposes without paying import duties or posting bonds.
An aircraft configured to carry both passengers and cargo on the Main Deck.
The commercial invoice is a bill for the goods from the seller to the buyer. These invoices are often used by governments to determine the true value of goods for the assessment of customs duties and are also used to prepare consular documentation. Governments using the commercial invoice to control imports often specify it's form, content, number of copies, language to be used and other characeristics.
The person or firm named in a freight contract to whom goods have been consigned or turned over. For export control purposes, the documentatoin differentiates between an intermediate consignee and an ultimate consignee.
Delivery of merchandise from an exporter (the consignor) to an agent (the consignee) under agreement that the agent sell the merchandise for the account of the exporter. The consignor retains title to the goods until sold. The consignee sells the goods for commission and remits the net proceeds to the consignor.
In order to handle small lot of consignment efficiently and competitively, freight forwarder usually put many consignments into one lot then tender to carrier for forwarding. In this case, each consignment will be shipped with one HAWB respectively and all of them will be under one master AWB.
Cost and Freight (CFR)to a named overseas port of import Under this term, the seller quotes a price for the goods that includes the cost of transportation to the named point of debarkation. The cost of insurance is left to the buyer's account. (Typically used for ocean shipments only. CPT or carriage paid to, is a term used for shipment by modes other than water.) Also, a method of import valuation that includes insurance and freight charges with the merchandise values.
Cost, insurance and freight (CIF)to a named overseas port of import. Under this term, the seller quotes a price for goods (including insurance), all transportation, and miscellaneouse charges to the point of debarkation for the vessel. (Typically used for ocean shipments only, CIP, or carriage and insurance paid to, is a term used for shipment by modes other that water.
The government authorities designated to collect duties levied by a country on imports and exports.
An individual or company licensed by the government to enter and clear goods through Customs. The U.S. Customs Service defines a Customs Broker, as any person who is licensed in accordance with Part III of Title 19 of the Code of Federal Regulations (Customs regulations) to transact Customs business on behalf of others. Customs business is limited to those activities involving transactions with Customs concerning the entry and admissibility of merchandise; its classification and valuation; the payment of duties, taxes, or other charges assessed or collected by Customs upon merchandise by reason of its importation, or the refund, rebate, or drawback thereof.
The procedures involved in getting cargo released by Customs through designated formalities such as presenting import license/permit, payment of import duties and other required documentations by the nature of the cargo such as FCC or FDA approval.
A document, required by some foreign countries' customs officials to verify the value, quantity, and nature of the shipment, describing the shipment of goods and showing information such as the consignor, consignee, and value of the shipment.
Commodities classified by IATA according to its nature and characteristic in terms of the effect of its danger to carrier's flying safety.
Deliver Duty Paid.
Deliver Duty Unpaid.
Provides specific information to the inland carrier concerning the arrangement made by the forwarder to deliver the merchandise to the particular pier or steamship line. Not to be confused with Delivery Order which is used for import cargo.
Excess time taken for loading or unloading a vessel, thus causing delay of schedule departure. Demurrage refers only to situations in which the charter or shipper, rather than the vessel's operator, is at fault.
Also called measurement weight. This is the size of consignment calculated by total square feet by 6000. Carrier charge for freight based on the dimensional weight or actual gross weight whichever is higher.
Ship without consolidation and under one MAWB ie non-consolidation.
Drawback is a rebate by a government, in whole or in part, of customs duties assessed on imported merchandise that is subsequently exported. Drawback regulations and procedures vary among countries.
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 factors such as weight or quantity (specific duties), or a combination of value and other factors (compound duties).
EDI, Electronic Data Interchange for Administration, Commerce, and Transportation, is an international syntax used in the interchange of electronic data. Customs uses EDI to interchange data with the importing trade community.
Estimated Time of Arrival. Then, It normally takes 3 hours for carriers to Break Bulk then ready to be picked up by forwarders along with customs release notification.
Estimated Time of Departure. The cut-off time for carriers' cargo ramp handling is normally two hours ahead of ETD. However, the freight forwraders' consolidation cut-off time may vary depending on each forwarder's operations respectively.
A term of sale in which for the quoted price, the seller merely makes the goods available to the buyer at the seller's "named place" of business. This trade term places the greatest responsibiltiy on the buyer and minimum obligations on the seller. The Ex Works term is often used when making an initial quotation for the sale of goods without any costs included.
Like C & F, "Freight/Carriage paid to ..." means that the seller pays the freight for the carriage of the goods to the named destination. However, the risk of loss of or damage to the goods, as well as of any cost increases, is transferred from the seller to the buyer when the goods have been delivered into the custody of the first carrier and not at the ship's rail. The term can be used for all modes of transport including multi-modal operations and container or "roll on-roll off" traffic by trailer and ferries. When the seller has to furnish a bill of lading, waybill or carrier's receipt, he duly fulfills this obligation by presenting such a document issued by the person with whom he has contracted for carriage to the named destination. (Also see incoterms)
This term is the same as "Freight/Carriage Paid to ..." but with the addition that the seller has to procure transport insurance against the risk of loss of damage to the goods during the carriage. The seller contracts with the insurer and pays the insurance premium.
An independent business which handles export shipments for compensation. At the request of the shipper, the forwarder makes the actual arrangements and provides the necessary services for expediting the shipment to its overseas destination. The forwarder takes care of all documentation needed to move the shipment from origin to destination, making up and assembling the necessary documentation for submission to the bank in the exporters name. The forwarder arranges for cargo insurance, makes the necessary overseas communications, and advises the shipper on overseas requirements of marking and labelling.
In the context of travel activities, gateway refers to a major airport or seaport. Internationally, gateway can also mean the port where customs clearance takes place.
The Harmonized Commodity Description and Coding System (or Harmonized System, HS) is a system for classifying goods in international trade, developed under the auspices of the Customs Cooperation Council. Beginning on January 1, 1989, the new HS numbers replaced previously adhered-to schedules in over 50 countries, including the United States.
House Air waybill issued by carrying airlines' agent, normally freight forwarder.
International Air Transport Association (IATA), established in 1945, is a trade association serving airlines, passengers, shippers, travel agents, and governments. The association promotes safety, standardization in forms (baggage checks, tickets, weigh bills), and aids in establishing international airfares. IATA headquarter is in Geneva, Switzerland.
Two-character Airline identification assigned by IATA in accordance with provisions of Resolution 762. It is for use in reservations, timetables, tickets, tariffs as well as air waybill.
The import certificate is a means by which the government of the country of ultimate destination exercises legal control over the internal channeling of the commodities covered by the import certificate.
A document required and issued by some national governments authorizing the importation of goods.Also referred as import permit. With such documentation, customs clearance can be conducted.
Import restriction, applied by a country with an adverse trade balance (or for other reasons), reflect a desire to control the volume of goods coming into the country from other countries may include the imposition of tariffs or import quotas, restrictions on the amount of foreign currency available to cover imports, a requirement for import deposits, the imposition of import surcharges, or the prohibition of various categories of imports.
Maintained by the International Chamber of Commerce (ICC), this codification of terms is used in foreign trade contracts to define which parties incur the costs and at what specific point the costs are incurred. (also see incoterm section)
This certificate is used to assure the consignee that insurance is provided to cover loss of or damage to the cargo while in transit.
An intermediate consignee is the bank, forwarding agent, or other intermediary (if any) that acts in a foreign country as an agent for the exporter, the purchaser, or the ultimate consignee, for the purpose of effecting delivery of the export to the ultimate consignee.
Movement of goods by more than one mode of transport, ie. airplane, truck, railroad and ship.
A letter of credit in which the specified payment is guaranteed b the issuing bank if all terms and conditions are met by the drawee. It is as good as the issuing bank.
Lower deck type 3 container. This is the most commonly used container in passenger aircraft.
A financial document issued by a bank at the request of the consignee guaranteeing payment to the shipper for cargo if certain terms and conditions are fulfilled normally it contains a brief description of the goods, documents required, a shipping date and an expiration date after which payment will no longer be made.
The compartment below the Main Deck (also synonymous with lower hold and lower lobe).
The deck on which the major portion of payload is carried, normally known as Upper Deck of an airplane. The full cargo freighter aircraft has it entire upper deck equipped for main deck type of containers/pallets while Combi aircraft uses it rear part of the upper deck for cargo loading. There is no upper deck or main deck type of container/pallet at passenger aircraft.
Broadly, insurance covering the loss of, or damage to, goods at sea. Marine insurance typically compensates the owner of merchandise for losses in excess of those which can be legally recovered from the carrier that are sustained from fire, shipwreck, piracy, and various other causes. Three of the most common types of marine insurance coverage are "free of particular average" (f.p.a), "with average" (w.a.) and "All Risks Coverage".
No Value Declared.
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.
Proof Of Delivery, or a cargo/package receipt with the signature of receipant. This term has been widely used in courier and express industry and also gaining more attention and implementation at air cargo industry..
An invoice provided by a supplier prior to the shipment of merchandise, informing the buyer of the kinds and quantities of goods to be sent, their value, and important specifications (weight, size, and similar characteristics). When an importer applys for Letter of Credit as the means of payment, a Pro Forma Invoice from the beneficiary of such Letter of Credit, usually the exporter, is required by the L/C issuing bank.
The letters, numbers or other symbols placed on the outside of cargo to facilitate identification.
Shipping weight represents the gross weight in kilograms of shipments, including the weight of moisture content, wrappings, crates, boxes, and containers (other than cargo vans and similar substantial outer containers).
TACT stands for The Air Cargo Tariff. It is published by IAP -- International Airlines Publications, an IATA company.
The weight of a ULD and tie down materials without the weight of the goods it contains.
When an importer makes entry of articles and claimed to be exempt from duty under Chaper 98, Subchapter XIII, Harmonized Tariff Schedule of the United States, a bond is posted with Customs which guarantees that these items will be exported within a specified time frame (usually within one year from the date of importation). Failure to export these items makes the importer liable for the payment of liquidated damages for breach of the bond conditions.
Transshipment refers to the act of sending an exported product through an intermediate country before routing it to the country intended to be its final destination.
Unit Load Device, Any type of container, container with integral pallet, aircraft continer or aircraft pallet.
The ultimate consignee is the person located abroad who is the true party in interest, receiving the export for the designated end-use.
The U.S. Customs Service defines "value for Customs purposes only" as the value submitted on the entry documentation by the importer which may or may not reflect information from the manufacturer but in no way reflects Customs appraisement of the merchandise.
A term indicating that a shipper's agent or representative is empowered to make definitive decisions and adjustments abroad without approval of the group or individual represented.
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