ACCEPTANCE

Any agreement to purchase goods under specified terms. An agreement to purchase goods at a state price and under stated terms.

ACT OF GOD

It is 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.

ADDENDUM

Whenever the terms in a fully signed C/P are amended by subsequent negotions an addendum is prepared by the charterer's broker (and forms a part of the C/P). It comes into effect only when it is signed by all parties just like the original C/P.

ADDRESS COMMISSION

Commission payable to the charterer by the shipowner as a percentage of freight or hire. Historically it was paid to the charterer to cover up some of the expenses incurred by him.  At present it virtually works out to a reduction in the freight.

ADVANCE FREIGHT

Partial payment of the bill of lading freight in advance; in other respects is the same as guaranteed freight. In other words, freight payable before goods are accepted for shipment. Once paid it can not be recovered from the shipowner upon frustration on voyage and loss of goods.

AFRAMAX

Tanker of maximum 79,999 dwt on the AFRA freight rate assessment scale.

AFFREIGHTMENT

The hiring of a ship in whole or part

AIR DRAFT

This term has various meanings the most common being: The maximum height from the water line to the top-most point of a ship.

AIR WAYBILL

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.

ALL RISK

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, preshipment condition, inadequate packaging, or loss of market.

ALL TIME SAVED

Means that the time saved to a ship from the completion of loading/discharging to the expiry of laytime including periods excepted from laytime.

ALL WORKING TIME SAVED or ALL LAYTIME SAVED

Both these terms mean the same. Here the description of the time means that time saved to the owner from the completion of the loading and/or discharging until the expiry of the allowed laytime excluding and notice time and periods which are exceptions to laytime.

ALONGSIDE

A phrase referring to the side of a ship.

ALTERNATE HOLDS

Iron ore being a very heavy cargo is loaded in alternate holds, leaving remaining holds empty.

ALWAYS AFLOAT or ALWAYS SAFELY AFLOAT

This clause is inserted in a C/P to prevent a vessel from being ordered to proceed to a berth where she touches the ground during loading of discharging or which can only be reached after lighterage of part of her cargo or which can only be reached during high tide.

APPROVED CHARTERPARTY

A charterparty which has been agreed upon, adopted or recommended by BIMCO, G.C.B.S., etc.

ARBITRAGE

The buying of foreign exchange, securities, or commodities in one market and the simultaneous selling in another market, in terms of a third market. By this manipulation a profit is made because of the difference in the rates of exchange or in the prices of securities or commodities involved.

ARRIVAL PILOT STATION

A point of identification at which a time-chartered vessel is delivered to the charterer (or re-delivered to the shipowner). In this case the hire commences (or ends) as soon as the vessel reaches the pilot station. (This term favours the shipowner vis-à-vis “taking inward pilot” which favours the charterer).

ARRIVED SHIP

A vessel is an arrived ship and the laytime allowed under the C/P begins to count as soon as the following conditions have been complied with: 1) The vessel must have arrived at the port, berth or dock as stated in the C/P. 2) The vessel must be ready to load or discharge in every way. 3) A notice of readiness must have been given in writing to the charterers or shippers/consignees.

AS FAST AS THE VESSEL CAN RECEIVE/DELIVER

Means that the laytime is calculated by reference to the maximum rat at which the ship in full working order is capable of loading or discharging the cargo, that is, as fast as she can or with customary (quick) dispatch. The term appears in a C/P when laytime is not fixed (indefinite) and is left to the custom of the port.

AUSTALIAN HOLD LADDERS

All vessels trading with Australia must be provided with ladders acceptable to waterside workers’ federation/ unions in that country. These ladders are so constructed as to prevent fatigue due to platforms at regular intervals. Vessels without such type of ladders can be penalized or delayed.

AVERAGE

Any loss or damage due to insured perils that is less than a total loss. Two types of average occur: Particular Average and General Average.

AVERAGING LAYTIME

To average means to make separate calculations for lading and discharging and any time saved in one operation can be set off against any excess time used in the other. The option to average laytime is given to the charterer.

BACK FREIGHT

freight charged for the return of goods which have not been accepted at the port of destination. Also applied to goods discharged at another convenient port.

BALE CAPACITY

The cubic capacity of a ship’s holds below deck, expressed in cubic feet or cubic metres, available for the carriage of breakbulk type of cargoes, e.g.., packages, bales, cartons, cartons, drums, pallets, etc., which are not capable of filling the space between the ship’s frames.

BALLAST

Heavy weight, often sea water, necessary for the stability and safety of a ship which is not carrying cargo.

BALLAST BONUS

Sum of money paid by a time charterer to a shipowner (in a good market) to compensate him for not finding a cargo near the place of re-delivery of the ship at the end of the charter. The bonus serves as an incentive for the ballast (empty) trip to cover up the cost of fuel and time. At times a shipowner pay pat the charterer a ballast bonus when the vessel is being re-delivered at the end of time charter, specially when market is not good for the shipowner.

BAR DRAFT

This relates to the maximum draft enabling a vessel to pass over a bar, e.g., Martin Garcia bar in the River Plate. In case the vessel has too great a draft, it will have to discharge part of the cargo into barges and then reload it after passing the bar. A similar situation exists at Yangon (formerly Rangoon). Such ports are called bar-ports.

BAREBOAT /DEMISE CHARTER

Lease of a ship wherein the charterer takes over the ship together with the rigid of management and control. In fact the becomes the virtual owner of the vessel during the term of the charter. Charter has the right to engage and pay the master and crew who are his employees. The shipowner merely receives compensation as hire payments.

BEAUFORT SCALE

A scale of wind force expressed from 0 to 12 in which weather conditions represent with conditions expressed in numerals, where 0 means calm wind (less that I knot speed) and 12 refers to hurricane (speed between 64 to 71 knots). This term is used mostly in time charterparties, as vessels are not penalised for non-performance of speed in case wind speed is more than the agreed Beaufort number.

BEFORE BREAKING BULK

Refers to the time when freight is paid. In this case freight is to be paid any time before commencement of discharge.

BELOW BRIDGES

If a ship has to pass under a bridge across a canal to reach the port or berth it has to ensure that its draft permits the vessel to have sufficient clearance above its highest point to pass under the bridge with ease.

BENEFICIARY

The person in whose favor a draft is issued or a letter of credit opened.

BERTH

The specific place where ships are anchored for loading and/or discharging at the docks in a port.

BERTH CHARTER

If a vessel chartered for loading on a particular berth, the contract is called berth charter. The term berth charter implies that notice of readiness cannot be given until the vessel is in the designated berth as required by the charterers.

BERTH TERMS

Also referred to as “liner terms”. The Shipowner pays for loading and discharging subject to the custom of the port or as fast as the ship can handle the cargo or under customary dispatch.

BILL OF LADING

The document issued on behalf of the carrier describing the kind and quantity of goods being shipped, the shipper, the consignee, the ports of loading and discharge and the carrying vessel. It serves as a document of title, a contract of carriage, and a receipt for goods.

BLACK LIST

List of countries published by a government which will not allow ships to trade at its ports if they have traded at ports in the countries on that list.

BONDED WAREHOUSE

A building authorized by Customs authorities for storage of goods on which payment of duties is deferred until the goods are removed.

BOTH ENDS

The term means that the arrangements agreed upon hold true both at loading and discharging ports, e.g., rate of loading and discharging; appointment of agents, etc.

BRACKISH WATER ARRIVAL DRAFT

Brackish is spoken of water in a river when partly salt and partly fresh. It has a density between that of fresh water (1000 kgs/cubic metre) and that of salt water (1025 kgs/cubic metre). When a ship proceeds to a brackish water port, the ship’s draft will be more than the draft in salt water and less than the draft in fresh water.

BREAK BULK

Loose cargo, such as cartons, stowed directly in the ship's hold as opposed to containerized or bulk cargo. See "Containerization."

BREAKBULK

Describes loose cargo, such as cartons, bales, boxes, packages, etc stowed directly in the ship's hold as opposed to containerised or bulk cargo.

BREAKING BULK

The expression means “to start the discharge.”

BROKEN STOWAGE

The space wasted in a ship’s holds when stowing general cargo which is uneven and packed.

BROKER (SHIP)

A shipbroker acts as a middleman between the shipowner and the charterer and negotiates the terms of a C/P. He represents one party (say, shipowner) and negotiates with the other party (charterer) directly or with another broker who represents the charterer. (A sale and purchase broker negotiates for the sale of a ship and represents the shipowner).

BROKERAGE

Brokerage is a commission paid to the shipbroker by the shipowner for the broker’s time, effort and expenses in concluding a (successful) fixture, normally a certain percentage of the hire of freight earned by the shipowner.

BULK SHIPMENTS

Shipments which are not packaged, but are loaded directly into the vessel's holds. Examples of commodities that can be shipped in bulk are ores, coal, scrap, iron, grain, rice, vegetable oil, tallow, fuel oil, fertilizers, and similar commodities.

BUNDLING

This is the assembly of pieces of cargo, secured into one manageable unit. This is relevant to items such as Structural Steel, Handrails, Stairways etc. Whilst this is a very flexible description, a rule of thumb is to present cargo at a size easily handled by a large (20 tonne) fork lift truck.

BUNKER ADJUSTMENT FACTOR

A Fuel Surcharge expressed as a percentage added or subtracted from the freight amount, reflecting the movement in the market place price for bunkers.

BUNKERS

Name given for vessels Fuel and Diesel Oil supplies (Originates from coal bunkers)