Chartering & Shipping Terms

Stand: März 2015

ABBREVIATION  MEANING
AA Always Afloat
AAAA Always Accessible Always Afloat
AAOSA Always Afloat or Safe Aground
ABT About
AGROUND Touching or fast to the bottom
AVERAGE In marine insurance: A loss or damage to or in respect of goods or equipment. The numerical result obtained by dividing the sum of two or more quantities by the number of quantities
AVERAGE ADJUSTERS In general average affairs average adjusters are entrusted with the task
of apportioning the loss and expenditure over the parties interested in the maritime venture and to determine which expenses are to be regarded as average or general average
BBB Before Breaking Bulk. Refers to freight payments that must be received before discharge of a vessel commences
BILL OF LADING(B/L) A document which evidences a contract of carriage by sea. The document has the following functions:
• A receipt for goods, signed duly by a authorized person on behalf of the carriers.
• A document of title to the goods described therein.
• Evidence of the terms and conditions of carriage agreed upon between the two parties
BILL OF LADING CLAUSE A particular article, stipulation or single proviso in a Bill of Lading. A clause can be standard and can be preprinted on the B/L
BOB Bunker On Board
BOX PALLET Pallet with at least three fixed, removable or collapsible vertical sides
BREAK BULK To commence discharge
BROB Bunker Remaining On Board
BROKEN STOWAGE The cargo space which is unavoidably lost when stowing cargo. The percentage of wasted space depends upon e.g. the kind of cargo, the packing and the used spaces
BROKER Person who acts as an agent or intermediary in negotiating contracts
BROKERAGE Percentage of freight payable to broker (by owners in c/p’s) or applicable to sale or purchase
B2B (business-to-business) Describes online transactions between one business, institution, or government agency and another.
B2C (business-to-costumer) Describes online transactions between one business, institution, or government agency and a private costumer.
BULK CARGO Unpacked homogeneous cargo poured loose in a certain space of a vessel or container e.g. oil and grain
CARRIAGE PAID TO (named place of destination) Carriage paid to…. means that the seller pays the freight for the carriage of the goods to the named destination. The risk of loss of or damage to the goods, as well as any additional costs due to events occurring after the time the goods have been delivered to the carrier, is transferred from the seller to the buyer when the goods have been delivered into the custody of the carrier.
CASH AGAINST DOCUMENTS (CAD) Terms of payment: if the buyer of goods pays for the goods against transfer of the documents, entitling him to obtain delivery of the goods from the carrier
CASH ON DELIVERY (COD) Terms of payment: if the carrier collects a payment from the consignee and remits the amount to the shipper.
CBM Cubic Metres
CFR Cost and Freight
CHARTER PARTY A contract in which the ship owner agrees to place his vessel or a part of it at the disposal of a third party, the charterer, for the carriage of goods for which he receives a freight per ton cargo, or to let his vessel for a definite period or trip for which a hire is paid.
CHOPT Charterers Option
CIF “Cost, Insurance and Freight” means that the seller has the same obligations as under CFR but with the addition that he has to procure marine insurance against the buyer’s risk of loss of or damage to the goods during the carriage. The seller contracts for insurance and pays the insurance premium. The buyer should note that under the CIF term the seller is only required to obtain insurance on minimum coverage. The CIF term requires the seller to clear the goods for export. This term can only be used for sea and inland waterway transport. When the ship’s rail serves no practical purposes such as in the case of roll-on/ roll-off or container traffic, the CIP term is more appropriate to use.
COA Contract of Affreightment – Owners agree to accept a cost per revenue tonne for cargo carried on a specific number of voyages
COD Cash On Delivery
CONTRABAND Goods forbidden by national law to be imported or exported
COST AND FREIGHT(CFR) Cost and Freight (…named port of destination) means that the seller must pay the costs and freight necessary to bring the goods to the named port of destination but the risk of loss of or damage to the goods, as well as any additional costs due to events occurring after the time the goods have been delivered on board the vessel, is transferred from the seller to the buyer when the goods pass the ship’s rail in the port of shipment. The CFR term requires the seller to clear the goods for export.
This term can only be used for sea and inland waterway transport. When the ship’s rail serves no practical purpose, such as in the case of roll-on/roll-off or container traffic, the CPT term is more appropriate to use.
CP or C/P Charter Party
CROB Cargo Remaining On Board
DUNNAGE Materials of various types, often timber or matting, placed among the cargo for separation, and hence protection from damage, for ventilation and, in the case of certain cargoes, to provide space in which the tynes of a fork lift truck may be inserted.
ECONOMIC SPEED That speed of a means of transport which produces the best possible financial result for the owner. Such speed should not be in excess of the maximum or minimum output allowed for the engine(s).
FAC Fast as can
FAS Free Alongside Ship. Seller delivers goods to appropriate dock or terminal at port of embarkation and buyer covers costs and risks of loading.
FCA Free to Carrier. A modern equivalent of FAS used in intermodal transport where goods are transferred at a nominated forwarders premises, depot
or terminal but not actually on board vessel.
FD (FDIS) Free Discharge
FILO Free In/Liner Out. Seafreight with which the shipper pays load costs and the carrier pays for discharge costs.
FIO Free In/Out. Freight booked FIO includes the seafreight, but no loading/ discharging costs, i.e. the charterer pays for cost of loading/discharging cargo.
FIOS Free In/Out Stowed. As per FIO, but excludes stowage costs.It is most important to remember that the “Free” reference is viewed from the Ship Owners point of view – not the Shipper’s. Some Shippers get caught out when they read the word “Free” as they incorrectly believe that it refers to them.

Freight rates quoted on a FIOS basis specifically exclude all aspects relating to cargo handling operations. The ship is only responsible for expenses arising as a result of the ship calling into the port, i.e. tugs, pilots and light dues etc. Another very important consideration when booking cargo on FIOS terms is that the ship does not bear any responsibility for the speed of loading or discharging.
Usually the rate agreed includes a fixed “free” period of time for loading/discharging operations, after which time a daily demurrage is incurred. Obviously this is of paramount importance where port congestion or stevedoring performance is uncertain. There are many overseas ports which fall into this category and particularly where vessel demurrage rates can vary significantly, depending on the size and type of ship nominated to undertake the particular project.

FIOST Free In/Out and Trimmed. Charterer pays for cost of loading/discharging cargo, including stowage and trimming.
FIOT Free In/Out and Trimmed. As per FIOS but includes trimming, e.g. the eveling of bulk cargoes. FIOS includes seafreight, but excludes loading/discharging and stowage costs.
FIT Free In Trimmed
FOB The seller fulfils his obligation to deliver when the goods have passed over the ship’s rail at the named port of shipment. This means that the buyer has to bear all costs and risks of loss of or damage to the goods from that point. The FOB term requires the seller to clear the goods for export. This term can only be used for sea or inland waterway transport. When the ship’s rail serves no practical purpose, such as in the case of roll-on/roll-off transport, the FCA term is more appropriate to use.
FOQ Free On Quay
GENERAL CARGO Cargo, cosisting of goods, unpacked or packed, for example in cartons, crates, bags or bales, often palletized. General cargo can be shipped either
in breakbulk or containerized.
Any consignment other than a consignment containing valuable cargo and charged for transport at general cargo rates (aircargo).
HAGUE RULES Code of minimum conditions for the carriage of cargo under a Bill of Lading. International convention for the unification of certain rules, relating to Bills of Lading (1924). These Rules include the description of responsibilities of ocean carriers.
HAGUE-VISBY RULES Set of rules, published in 1968, amending the Hague Rules.
HAMBURG RULES United Nations Convention on the carriage of goods by sea of 1978 adopted in 1992.
LAYCAN Laycan (Layday Cancelling Date)
LAYDAYS The number of days allowed in a charter party for the loading and discharging of cargo. Lay days may be indicated in different ways
e.g. consecutive days, working days, weather working days.
LAYTIME Time at Charterers disposal for purpose of loading/discharging.
LOI Letter of Indemnity
LUMPSUM An agreed sum of money, which is paid in full settlement at one time. This term is often used in connection with charter parties.
LUMPSUM CHARTER A voyage charter whereby the shipowner agrees to place the whole or a part of the vessel’s capacity at the charterer’s disposal for which a lump-sum freight is being paid.
MANIFEST Inventory of cargo on board. Document which lists the specifications of goods loaded in a means of transport or equipment for transportation purposes. As a rule cargo manifests are drawn up by the agents in the place of loading. Note: For shipping a manifest represents a cumulation of Bills of Lading for official and administrative purposes.
MATE’s RECEIPT A document signed by the chief officer of a vessel acknowledging the receipt of a certain consignment on board of that vessel. On this document, remarks can be made as to the order and condition of the consignment.
MOLCHOPT More Or Less Charterers Option
MOLOO More Or Less Owners Option
MT Metric Tonne (e.g. 1.000 kilos)
M/V Motor Vessel / Merchant Vessel
NEGLIGENCE Imprudent action or omission which may cause injury, damage or loss
NEGOTIABLE In terms of documents, ‘negotiable’ means that e.g. a Bill of Lading is handed over/transferred in the right manner (viz. proper endorsement) to another person either endorsed in blank or endorsed to a person and that person acquires, by this transfer certain rights vis-a-vis the goods e.g. is entitled to take possession of the goods.
NOR Notice of Readiness
NOTIFY ADDRESS Address of the party other than the consignee to be advised of the arrival of the goods.
NOTIFY PARTY The party to be notified of arrival of goods
OVERTIME Work beyond normal established working hours that usually requires a premium to be paid to the employees concerned.
P & I Protection and Indemnity Insurance
Ship’s Protest Statement of the master of a vessel before (in the presence of) competent authorities, concerning exceptional events which occurred during a voyage.
SHIP OPERATOR A ship operator is either the shipowner or the (legal) person responsible for the actual management of the vessel and its crew.
SHIP OWNER The (legal) person officially registered as such in the certificate of registry where the following particulars are contained. Name of vessel and port of registry. Details contained in surveyors certificate. The particulars respecting the origin stated in the declaration of ownership. The name and description of the registered owner, if more than one owner the proportionate share of each.
SHIPPIER The merchant (person) by whom, in whose name or on whose behalf a contract of carriage of goods has been concluded with a carrier or any party by whom, in whose name or on whose behalf the goods are actually delivered to the carrier in relation to the contract of carriage. Synonym: Consignor, Sender.
WP Weather Permitting. That time during which weather prevents working shall not count as laytime.
WPD Weather Permitting Day
WWD Weather Working Day