What are Incoterms?

Incoterms are international rules that are accepted by governments, legal authorities and practitioners worldwide for the interpretation of the most commonly used terms in international trade. They either reduce or remove altogether uncertainties arising from differing interpretations of such terms in different countries.

What do they cover?

The scope of Incoterms is limited to matters relating to the rights and obligations of the parties to the contract of sale with respect to the delivery of goods sold, but excluding “intangibles” like computer software.

What is dimensional weight?

Dimensional weight is a standard formula used throughout the freight industry that considers a package’s density when determining charges. Transportation charges are based on the gross weight of the shipment or the dimensional weight of the shipment; whichever is greater. Simply put, dimensional weight is when the weight of a package is inappropriately less than the actual size of the package. For example, a box filled with inflated balloons.

When do dimensional weight charges apply?

When the actual weight of a package is less than the calculated dimensional weight, carriers charge by the dimensional weight. Weight or Volume (wt.) whichever is higher is your chargeable weight.

How do I determine the "volume weight" for airfreight?

Volume weight is determined by using the following calculations for those shipments with dimensions in centimeters: (Length x Width x Height) divided by 6000 = volume in kilograms.

Do all ocean shipments require an original Ocean Bill of Lading (OBL) to be surrendered prior to delivery?

In most cases, this is required. The seller has the option of requesting an “LINES bill of lading” which will allow for the release of the cargo without the original ocean bill of lading.

Are my airfreight charges based on the actual weight of the cargo only?

IATA regulations state that the cost of airfreight must be calculated on the “chargeable” weight. IATA defines the “chargeable weight” as the actual gross weight or the volume weight, whichever is greater.

How come my freight did not make the connection from Country “A” to Country “B”, I did?

The time between transfers for passengers and cargo differ greatly. While passengers can have schedules with even up to an hour to spare between flights, with cargo it takes a minimum of three-five hours from arrival of one airplane to another. Freight off one airplane might have multiple destinations and has to be transferred. In addition, the location on the arrival aircraft could be a factor. This has to do with the balance of the airplane, position goods were loaded in, size of freight and whether or not it was containerized.

When does the carrier’s liability begin and end?

The Carrier shall be liable for loss of or damage to the goods occurring between the time when the carrier accepts and takes the goods into its charge and the time of delivery.