Some Trade and Shipping Terms to Keep in Mind

If you are indulged in an import export business, there had been many instances when you had to transport your goods across borders. When you are knee deep in the entire shipping process, you are most likely to encounter some terms that you might not be able to comprehend. But getting acquainted with these terms is important to grasp the concept of the freight forwarding process from the inception to its culmination. Clearit Canada lists some common terms used in trade and shipping.

  1. Air waybill

This refers to shipping documentation which is used by the air freight forwarders. This is a documented contract between the airline company and the shipper that mentions all the terms and conditions for transporting the goods. It also mentions the product details, shipping destination, consignee information and transportation charges.

  1. Bill of lading

The BOL, B/L or bill of lading is quite similar to the air waybill apart from the fact that it covers the goods which are being transported by sea. It also entails all the essential deets about the freight forwarding agreement between the shipper and the carrier. The BOL also acts as a receipt that is required to be presented by the consignee in order to take the possession of the shipment on arrival.

  1. Breakbulk cargo

Merchandize that is shipped loose and not in a container is defined as breakbulk cargo. This merchandize is usually grouped or consolidated for shipment purposes. Then the consignment is unloaded and dispersed at the breakbulk terminal in order to be dispatched to different destinations.

  1. Certificate of free sale

It is a document that validates that the merchandize is in compliance with the import guidelines of the destination country. It is usually issued by an authoritative government party to offer assurance to the importer that the goods are always up to the quality standards. Certificate of free sale is commonly issued for cosmetics, food items, medicinal equipment, and much more.

  1. Free on Board or FOB

It states that the seller is solely responsible for the risks and costs related to the delivery of goods to a particular destination. When the shipment arrives at the port, all the transportation costs, damages, and obligations have to be paid by the buyer. FOB can be applied only for ocean or inland waterway transportation.

  1. Free Trade Agreement or FTA

It is an agreement that states approval of an unrestricted good exchange between the importer and exporter no matter of what the national borders are between them. The FDA addresses the issues of import quota, labor mobility, tariff or tax issues between the two parties.