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Freight Terms Glossary

Following are some commonly used freight terms used in the shipping industry. We've compiled this list of shipping terms to help make your next shipment booking easier. If you’d like additional help or have a specific question, please contact us.

| A | B | Ca Cl Co | D | F | G | H | L | N | O | P | S | T |


Accessorial Fees

Charges for service beyond standard transportation pricing. Such fees would include special pickup or delivery on domestic shipments, and documentation and communication fees for international shipments.

Actual Gross Weight

The full weight of a shipment, including goods and packaging.

Air Waybill

A bill of lading that covers both domestic and international flights transporting goods to a specified
destination. This is non-negotiable and serves as a receipt for the shipper, indicating that the carrier has accepted the goods listed and obligating it to carry the consignment to the airport of destination according to specified conditions.

Bill of Sale

This document is a confirmation of the transfer of ownership of certain goods to another person (i.e., in return for money paid or loaned).

B/L (Bill of Lading)

A document which acknowledges receipt of the goods and establishes the terms of a contract between a shipper and transportation company. It signifies which freight is to be moved between specified points for a specified charge. As the most fundamental document in goods transportation, it serves as a document of title, a contract of carriage, and a receipt for goods. It is prepared by the shipper on forms issued by the carrier. It is a legal document.

Bonded Warehouses

This facility is authorized by Customs authorities for storage or processing of goods. No Customs duties are incurred until the goods are removed.

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C.A.F. (Currency Adjustment Factor)

Additional charge on ocean freight, expressed as a percentage of a base rate, which reflects adjustments to costs based on foreign currency exchange rates.

Carrier

Any person or entity 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.

Certificate of Origin

A document certifying in which country the goods were produced. Used in international commerce.

Claim

A demand for payment made upon a transportation line due to loss sustained through its
alleged negligence.

Classification

A publication, such as The Uniform Freight Classification (railroad) or the National Motor Freight Classification (motor carrier), that assigns ratings to various articles and provides bill of lading descriptions and rules.

Classification Rating

The designation provided in a classification by which a class rate is determined.

Clean Bill of Lading

A receipt for goods issued by a carrier with an indication that the goods were received in "apparent good order and condition" without damage or other irregularities.

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Commercial Invoice

Represents a complete record of the transaction between exporter and importer with regard to the goods sold. Also reports the content of the shipment and serves as the basis for all other documents concerning the shipment.

Commodity

Article shipped. For dangerous and hazardous cargo, the correct commodity identification is crucial.

Consignee

The person or company (named in the bill of lading) to whom commodities are shipped. The owner of the cargo.

Consignment

Goods in transit under a bill of lading; the delivery of merchandise from an exporter (the consignor) to an agent (the consignee) under agreement that the agent sell the merchandise for the exporter’s account.

Consignor

The person or company shown as the shipper on the bill of lading.

Container

A truck trailer body that can be detached from the chassis for loading into a vessel or a rail car or
stacked in a container depot. Containers may be ventilated, insulated, refrigerated, flat rack, vehicle rack, open top, high cube, bulk liquid, or equipped with interior devices. A container may be 20 feet, 40 feet, 45 feet, 48 feet, or 53 feet in length; 8'0" or 8'6" in width; and 8'6" or 9'6" in height.

Customs

The authorities designated to collect duties on imports and exports that are levied by a country (also applying to the procedures involved in such collection). They are responsible for ensuring that no illegal importation takes place.

Customs Invoice

A form requiring all data in a commercial invoice along with a certificate of value and/or a certificate of origin. Required in a few countries (usually former British territories) and usually serves as a seller’s commercial invoice.

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Dim Weight (Dimensional Weight or Volume Weight)

Freight charges calculated by the cubic dimension (total cubic inches). This measurement, along with the weight of the pieces shipped, is typically used by airfreight carriers to determine their freight charges.

Dock Receipt

A receipt issued to acknowledge receipt of a shipment at the carrier’s dock or warehouse facilities. When delivery of a foreign shipment is completed, the dock receipt is surrendered to the vessel operator or agent and serves as a basis for preparation of Bill of Lading.

Force Majeure

The title of a standard clause in marine contract that relieves the parties for responsibility upon non-fulfillment of their obligations resulting from conditions beyond their control (such as earthquakes, floods, or war).

Free Trade Zone

A country’s government designates this area, where any non-prohibited merchandise may enter duty-free. In this zone goods may be used in manufacturing, put on display, warehoused, etc., and re-exportation is also duty-free if the merchandise should pass from the zone into another area of the country.

General Tariff

A tariff that applies to countries that do not enjoy either preferential or most-favored-nation tariff
treatment. When the general tariff rate differs from the most-favored-nation rate, the general rate is usually the higher rate.

H.S. (Harmonized System of Codes)

An international goods classification system used to describe cargo under a single commodity coding scheme in international trade. It is the current U.S. tariff schedule (TSUSA) for imports and is the basis for the ten-digit Schedule B export code.

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LCL (Less than Container Load)

The quantity of freight less than that required for the application of a container load rate. Loose Freight.

LTL (Less than truckload)

This term typically refers to shipments of 150 – 10,000 pounds, not requiring the full use of a trailor.

Net Weight (Actual Net Weight)

Weight of the goods alone without any immediate wrappings; e.g., the weight of the contents of a tin can excluding the can’s weight.

N.M.F.C. (National Motor Freight Classification)

A listing of items used to determine the “class” of a particular item shipped. The class of the item along with the weight and distance traveled, is a determinator of the freight charge.

O.B.L. (Ocean Bill of Lading or Original Bill of Lading)

Document that indicates that the exporter will consign a shipment to an international carrier for transportation to a specified foreign market and defines the terms of the contract of carriage. It 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, surrender the original B/L, or meet other conditions agreed upon by the seller.

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Packing List

Itemized list of commodities with marks/numbers but no cost values indicated.

Pallet

A flat metal or wood bottom for cargo.

Payee

A party named as the beneficiary of funds. Under letters of credit, the payee is either the drawer of the draft or a bank.

Payer

A party responsible for the payment as evidenced by the given instrument. Under letters of credit, the payer is the party on whom the draft is drawn, usually the drawee bank.

Port of Entry

At this port foreign goods are admitted into the receiving country. The Customs authority designated this point where goods are examined and go through clearance.

Power of Attorney

A method a company uses to assign authority to another company or person to perform a certain
function on the behalf of the first company.
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Schedule B

Refers to Schedule B, Statistical Classification of Domestic and Foreign Commodities Exported from the United States. A number assigned to each commodity being exported from the Harmonized Tariff.

S.E.D. (Shipper’s Export Declaration or “Ex Dec”)

A U.S. Commerce Department document describing all goods exported from the U.S. The shipper of the goods is responsible to make sure the document is filled out correctly, even though it may be done as a service for them by a freight forwarder or an NVOCC. This official document must be submitted by a U.S. exporter whenever a shipment of merchandise goes from the U.S. to a foreign destination. The joint Bureau of Census-International Trade Administration issues this form used for compiling U.S. export control laws. In it the shipper shows the value, weight, consignee, destination, etc., of export shipments as well as the Schedule B identification number.

Truckload

This may be as little as 5,000 pounds, or as much as 50,000 pounds. Charges differ from LTL charges, in that the carrier typically charges on a per-mile basis, with some minimum charge for deliveries under 500 miles. These charges vary significantly in different areas of the country based on the availability of loads in that area, at that point and time.
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