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Broadly speaking, it is any agreement to purchase goods under specified terms. An agreement to purchase goods at a stated price and under stated terms.
ACT OF GOD
A natural event, not preventable by any human agency, such as flood, storms, or lightning. Forces of nature that a carrier has no control over, and therefore cannot be held accountable. See “Force Majeure.”
Partial payment of the bill of lading freight in advance; in other respects is the same as guaranteed freight.
A bill of lading that covers both domestic and international flights transporting 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 obligates itself to carry the consignment to the airport of destination according to specified conditions.
The broadest form of coverage available, providing protection against all risks of physical loss or damage from any external cause. Does not cover loss or damage due to delay, inherent vice, pre-shipment condition, inadequate packaging, or loss of market.
A phrase referring to 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.
LCL(Less-than-carload; also, Less-than-containerload)
A shipment that occupies less space than is available in a railcar or cargo-carrying container.
JUST-IN-TIME INVENTORY SYSTEM
An inventory system that keeps production inventory to an absolute minimum.
IRREVOCABLE LETTER OF CREDIT
A letter of credit in which the specified payment is guaranteed by the bank if all terms and conditions are met by the drawee.
A shipment utilizing more than one mode of transport, i.e., a shipment moving in container by water and then by rail.
INLAND BILL OF LADING
A bill of lading used in transporting goods overland to the exporter’s international carrier.
A loss caused by the inherent nature of the thing insured and not the result of a casualty or external cause.
A term applied to the status of merchandise admitted provisionally to a country without payment of duties, either for storage in a bonded warehouse or for trans-shipment to another point, where duties will eventually be imposed.
Poses hazards to handlers or to other cargoes and, because of this, requires special handling. Often subject to regulatory control.
Freight payable whether the goods are delivered or not, provided the failure to deliver the goods resulted from causes beyond the carrier’s control.
GOODS IN TRANSIT
Goods moving between two points.
Cargo shipped by sea or air.
Companies that buy space in large quantities and sell it to shippers requiring less vessel space. Also perform many other services for shippers including preparation of export documentation and arranging for cargo insurance.
The money charged by the carrier for transporting goods.
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. Also called FOREIGN TRADE ZONE.
The title of a standard clause in marine contracts exempting the parties for non-fulfillment of their obligations as a result of conditions beyond their control, such as earthquakes, floods, or war. See “Act of God.”
FLAGS OF CONVENIENCE
Nations that have lax maritime registration rules. Many ships are registered in these countries because of their lenient safety and crew requirements.
If a merchant sells on F.O.B., F.A.S., C &F or similar terms, it is the buyer’s responsibility to place the insurance.
F.O.B. WAREHOUSE (Free on board warehouse)
Seller owns goods until they are delivered to buyer’s warehouse at final destination; selling price includes all costs so far plus transportation to final warehouse.
F.O.B. VESSEL (Free on board vessel)
Seller owns goods until they are loaded on vessel; selling price includes all costs so far plus cost of loading on vessel.
F.O.B. TRUCK (Free on board truck)
Seller owns goods until they are loaded on truck at his factory; selling price includes all costs so far plus cost of loading on truck.
F.C.&S. (Free of Capture & Seizure)
Clause excluding war risks from the Marine Policy; war risks can be covered by issuing a separate War Policy with an additional premium being charged.
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