Glossary
50 terms you will meet in quotes, invoices and forwarder emails. Each explained from the importer’s side, that is, answering “what does this mean for me”.
A
- ADRAccord Dangereuses Route
- The European agreement governing road carriage of dangerous goods. Lithium batteries, aerosols, magnets and flammable liquids all fall under it, and each requires an MSDS sheet plus specific packaging and labelling. Declaring dangerous goods late is one of the most expensive mistakes in importing.See also:MSDS
- AWBAir Waybill
- The transport document for air cargo. Unlike a bill of lading it is not a document of title - goods are released to the named consignee, not to whoever holds the paper.See also:B/L (Bill of Lading)
L
- Letter of credit
- A bank undertaking to pay the seller once they present documents proving shipment on agreed terms. Protects both sides but costs money and is unforgiving about paperwork: a single discrepancy in a document can block payment.
B
- B/L (Bill of Lading)
- The sea transport document, and a document of title: whoever holds the original can collect the goods. This is why the original is released only after payment, and why Telex Release exists to speed things up.See also:Telex ReleaseAWB
- BAFBunker Adjustment Factor
- A fuel surcharge on top of the base freight, adjusted as bunker prices move. Almost always quoted separately, which is why a base rate alone tells you little.See also:CAF
- Blank sailing
- A cancelled sailing on a scheduled service. Carriers use it to manage capacity when demand drops; for the importer it means a delay of a week or more with no compensation.
- Bill of lading
- See B/L - the sea transport document that also functions as a document of title.See also:B/L (Bill of Lading)
C
- CAFCurrency Adjustment Factor
- A surcharge covering exchange rate movement between the currency of the freight and the currency of settlement.See also:BAF
- CBMCubic metre
- The unit of volume that prices groupage. Length × width × height in metres. In LCL you pay for volume or weight, whichever is greater, which is why a light bulky consignment costs more than its weight suggests.See also:LCLChargeable weight
- CFRCost and Freight
- The seller pays freight to the destination port, but risk passes to the buyer on loading. A common source of confusion: paying for carriage is not the same as bearing the risk during it.See also:CIFIncoterms
- CFSContainer Freight Station
- The warehouse where groupage consignments are consolidated into and deconsolidated from containers. Handling there is billed separately and is easy to overlook in an LCL quote.See also:LCL
- Chargeable weight
- The greater of actual and volumetric weight. Air cargo divides length × width × height in centimetres by 6000; express couriers usually by 5000. This single rule decides whether air freight is expensive or merely costly.See also:CBM
- CIFCost, Insurance and Freight
- As CFR, plus minimum insurance paid by the seller. The cover is minimal by definition - for valuable goods it is worth arranging your own.See also:CFRIncoterms
- CIPCarriage and Insurance Paid To
- The seller pays carriage and insurance to a named place. Unlike CIF it applies to any mode, not just sea.See also:Incoterms
- CMR
- The consignment note for international road carriage, and the convention governing it. Confirms the carrier took the goods and on what terms.
- Consolidation
- Collecting goods from several suppliers into a single shipment, usually at a warehouse in China. Saves the fixed costs of a shipment paid several times over.See also:LCLCFS
- Customs inspection
- A physical or documentary check by customs. Costs time and money - inspection charges and storage during it are billed to the importer.
- Certificate of origin
- The document confirming where goods were produced. Required for preferential duty rates and for anti-dumping determinations.
D
- Duty
- The charge levied on import into the EU, calculated from the customs value and the HS classification of the goods. Rates commonly run 0–12%, but anti-dumping duties on some goods from China run far higher.See also:HS CodeCustoms valueTARIC
- DAPDelivered At Place
- The seller delivers to a named place; import clearance, duty and VAT remain with the buyer. Often the sensible middle ground between FOB and DDP.See also:DDPIncoterms
- DDPDelivered Duty Paid
- The seller covers everything including import clearance. Convenient in appearance and risky in practice: if the seller is the declared importer, the import VAT was not paid by you and there is nothing on your side to deduct.See also:DAPIncoterms
- Demurrage
- A charge for keeping a container inside the terminal beyond the free days. Accrues daily and starts quietly - ask how many free days a quote includes before you accept it.See also:Detention
- Detention
- A charge for keeping a container outside the terminal - at your warehouse - beyond the free days. Distinct from demurrage and often billed on a different scale.See also:Demurrage
- DPUDelivered at Place Unloaded
- The seller delivers and unloads at the named place. The only Incoterm under which the seller is responsible for unloading.See also:Incoterms
T
- T1 document
- A transit document allowing goods to move within the EU without clearance being completed, for example from the port of arrival to a customs office inland.
- TARIC
- The EU tariff database: duty rates, restrictions and anti-dumping measures for a given HS code. The binding source when you need a definite answer.See also:HS CodeDuty
- Telex Release
- Electronic release of cargo without presenting the original bill of lading. Speeds up collection, and is only issued once the carrier is satisfied payment has been made.See also:B/L (Bill of Lading)
- TEUTwenty-foot Equivalent Unit
- The standard unit of container capacity. A 20-foot container is one TEU, a 40-foot two.
- THCTerminal Handling Charge
- Terminal handling, charged at both origin and destination. The single line most often missing from a cheap-looking quote.See also:BAF
E
- EORI
- The identification number required to clear goods as an importer in the EU. Issued free of charge; arranging it before the goods arrive avoids storage charges while you wait.
- ETAEstimated Time of Arrival
- The estimated arrival date. Estimated is the operative word - schedules slip, and blank sailings move them by a week at a time.See also:ETDBlank sailing
- ETDEstimated Time of Departure
- The estimated departure date from the port of loading.See also:ETA
F
- FCAFree Carrier
- The seller delivers to a named place and handles export clearance; carriage is arranged by the buyer. Often the cleaner alternative to EXW.See also:EXWIncoterms
- FCLFull Container Load
- A whole container hired for your cargo, priced per container regardless of how full it is. Usually beats groupage above roughly 13–15 CBM.See also:LCLCBM
- FOBFree On Board
- The seller bears cost and risk until the goods are loaded on the vessel, including export clearance. The most common and usually the safest basis for importing from China.See also:EXWIncoterms
- Fumigation
- Treatment of wooden packaging against pests, required by ISPM 15. Missing certification can mean the shipment is held or destroyed at the border.
G
- GRIGeneral Rate Increase
- A general rate rise announced by carriers, typically at the start of a month and typically in peak season.See also:Peak Season Surcharge
H
I
- Incoterms
- The set of eleven rules defining who pays for what and where risk passes between seller and buyer. They do not govern payment terms or title - only cost and risk in carriage.See also:FOBEXWDDP
- ISPSInternational Ship and Port Facility Security
- A port security surcharge, small but almost always billed separately.
P
- Packing list
- The document listing what is in each carton or on each pallet, with dimensions and weights. The basis for calculating volume, and the document most often inconsistent with the invoice.
- Peak Season Surcharge
- A seasonal surcharge applied when demand exceeds capacity - before Chinese New Year and in the pre-Christmas window.See also:GRI
- Procedure 33a
- The Polish procedure allowing import VAT to be settled in the VAT return rather than paid at the border. Materially improves cash flow for regular importers.See also:Customs value
M
- MSDSMaterial Safety Data Sheet
- The safety data sheet required for goods classed as dangerous. Without it a forwarder cannot accept the cargo.See also:ADR
S
- Sealine
- The shipping line operating the vessel. Worth knowing, because transit times and reliability differ between lines on the same route.
V
- VGMVerified Gross Mass
- The verified gross mass of a packed container, mandatory before loading. Responsibility for declaring it sits with the shipper.
W
- WIT
- Binding tariff information, a formal decision from the Polish customs authority confirming the classification of goods. Worth obtaining for high-value repeat imports, because it removes the classification risk.See also:HS Code
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