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Glossary of Customs and Trade Terms: Word/Acronym Meaning
Glossary of Customs and Trade Terms: Word/Acronym Meaning
The following Customs and Trade terms are intended as a guide to assist anyone
who may not be familiar with the vast array of terms and acronyms that populate
the world of Customs and international trade and travel.
The words and acronyms selected for inclusion are those likely to be encountered
by anyone employed in the broad areas linked to the international movement of
goods and people, or by those undertaking study in these areas.
The meanings included in the Glossary have been drawn from a wide range of
sources and it is acknowledged that these meanings may vary from country to
country and even within different areas of trade.
The actual meanings provided are based upon the knowledge and opinion of
CCES personnel and are those thought to be most appropriate for use across the
international trade and travel spectrum. They will not always align with the
legislation of a particular country and may not align with the general usage within
a particular area of trade.
Word/Acronym Meaning
AAPA The American Association of Port Authorities is a trade
association which represents more than 130 public port
authorities in the United States, Canada, the Caribbean and
Latin America. AAPA provides leadership on trade,
transportation, environmental and other issues related to port
development and operations.
Accession The process of adhering to a legal instrument. In the case of
GATT, the prospective Contracting Party enters into accession
negotiations with the Contracting Parties to determine the
concessions (trade liberalization) or other specific obligations
it must undertake before accession is concluded.
ACBPS Australian Customs and Border Protection Service
Ad valorem duties Latin, ‘according to the value.’ Duties and taxes that are
& taxes calculated on the basis of value.
Administrative The procedure laid down by national legislation under which
settlement the Customs are empowered to settle a Customs offence
either by ruling thereon or by means of a compromise
settlement. (see Annex H, Revised Kyoto Convention)
Admiralty Court A court having jurisdiction over maritime questions pertaining
to ocean transport, including contracts, charters, collisions,
and cargo damages. (Also known as maritime courts).
AFTA ASEAN Free Trade Area. An agreement supporting local
manufacturing in the ASEAN region.
Agent A person authorized to transact business for and in the name
of another person or company. Types of agent include
brokers, commission merchants, resident buyers, sales
agents, manufacturer's representatives.
Air Freight A type of freight forwarder who specializes in air cargo. An air
Forwarder freight forwarder usually consolidates the air shipments of
various exporters, charging them for actual weight and
deriving profit by paying the airline the lower consolidated
rate. Air freight forwarders issue their own air waybills to the
exporters.
Air waybill A non-negotiable forwarding agreement or carrying
agreement between the shipper and the air carrier. It may be
issued directly by the carrier or through an authorised agent.
Airline As provided in Article 96 of the Chicago Convention, any air
transport enterprise offering or operating a scheduled
international air service. (ICAO Annex 9)
‘All Risk’ A clause included in marine insurance policies to cover loss
Insurance and damage from external causes, such as fire, collision,
pilferage, etc. but not against innate flaws in the goods, such
as decay, germination, nor against faulty packaging or loss
market, nor against war, strikes, riots, and civil commotion.
These policies do not name the risks covered but only list the
exclusions. All unnamed risks are automatically covered.
Anti-dumping Duty imposed to offset the amount or margin of dumping.
duty
ANZCERTA See CER
APEC Asia-Pacific Economic Cooperation. A forum established as a
vehicle for multilateral cooperation among the market-
oriented economies of the region to better manage their
growing interdependence and sustain economic growth.
Begun in 1989 as an informal grouping of 12 Asia-Pacific
economies (Australia, Brunei, Canada, Indonesia, Japan,
South Korea, Malaysia, New Zealand, Philippines, Singapore,
Thailand and the United States), APEC admitted the People's
Republic of China, Chinese Taipei and Hong Kong in 1991,
Mexico and Papua New Guinea in 1993, Chile in 1994, and
Peru, Russia and Vietnam in 1998.
API Advance Passenger Information. The Advance Passenger
Information system (API) provides data about travellers in
advance of their arrival into the country. This can include
information about passengers, crew and transit travellers.
The information can then be checked against warning lists
and used for immigration processing, security and customs
purposes. The main objectives of API systems are to provide
advance warning of persons of interest travelling to the
country and to facilitate the clearance of legitimate travellers.
Apron The area immediately in front of or behind a wharf shed on
which cargo is lifted. On the ‘front apron,’ cargo is unloaded
from or loaded onto a ship. Behind the shed, cargo moves
over the ‘rear apron’ into and out of railroad cars or other
forms of carriage.
B/L, The B/L is a title document to the goods, issued ‘to the order of’ a
negotiable party, usually the shipper, whose endorsement is required to
effect its negotiation. Thus, a shipper's order (negotiable) B/L can
be bought, sold, or traded while goods are in transit and is
commonly used for letter-of-credit transactions. The buyer must
submit the original B/L to the carrier in order to take possession
of the goods.
B/L, non- B/L that cannot be transferred by endorsement.
negotiable
B/L, original B/L used in taking delivery of a shipment, or filing a claim on a
damaged or lost shipment. All other copies of a B/L are for
recording purposes only.
B/L, B/L set which has completed a prescribed number of edits
reconciled between the shippers instructions and the actual shipment
received. This produces a very accurate B/L.
B/L, stale B/L presented to its consignee, or at a bank, after the last date
specified in the relevant letter of credit and which, therefore, is
not acceptable as a valid document. According to the uniform
commercial code (UCC), a B/L may be rejected if presented more
than 21 days after the date of arrival of the shipment.
B/L, status Represents whether the bill of lading has been input, rated,
reconciled, printed, or released to the customer.
B/L, Terms & The fine print on B/L; defines what the carrier can and cannot do,
Conditions including the carrier's liabilities and contractual agreements.
B/L, Through B/L issued for containerized door-to-door shipments that have to
use different ships and/or different means of transportation
(aircraft, railcars, ships, trucks, etc.) from origin to destination.
Unlike in case of a multimodal Bill Of Lading, the principal carrier
or the freight- forwarder (who issued the through B/L) is liable
under a contract of carriage only for its own phase of the journey,
and acts as an agent for the carriers executing the other phases.
B/L, unclean A B/L that bears a superimposed clause or notation that declares
a defective condition of the goods and/or the packaging.
B/L, voided Related to Consolidated B/L; those B/L's absorbed in the
combining process. Different from Cancelled B/L.
Back haul To haul a shipment back over part of a route which it has already
travelled; a marine transportation carrier’s return movement of
cargo, usually opposite from the direction of its primary cargo
distribution.
Back-to-Back Guarantee (standby credit) arranged to secure a contractor's or
Credit seller's performance at the same time a guarantee (standby
credit) is arranged to secure the owner's or buyer's payment.
Also called back to back guarantee or reciprocal credit.
BAF Abbreviation - Additional charge levied on the shippers to
compensate for fluctuations in the price of the ship's fuel. Also
called ‘bunker surcharge’, ‘bunker charge’, or ‘fuel adjustment
factor’ (FAF).
Bulk carriers Vessels designed to carry dry (such as grain, cement, fertilizers,
etc.) or liquid (oil, petroleum, methanol, etc.) bulk cargo.
Bulkhead A wall or partition separating one part of a ship, freight car,
aircraft or truck from another part. This reinforces the structure
and/or restrains the contents.
Bunkers A maritime term referring to fuel used aboard the ship. Coal
stowage areas aboard a vessel in the past were in bins or
bunkers.
C&F Obsolete, but heavily used, term of sale meaning ‘cost and
freight’ whereby Seller pays for cost of goods and freight
charges up to destination port. In July, 1990 the International
Chamber of Commerce replaced C&F with CFR
C&I/CI Abbreviation for ‘Cost and Insurance.’ A price that includes the
cost of the goods, the marine insurance and all transportation
charges except the ocean freight to the named point of
destination.
Cabotage (1). Water transportation term applicable to shipments
between ports of a nation; commonly refers to coast-wise or
inter-coastal navigation or trade. Many nations, including the
United States, have cabotage laws, which require national flag
vessels to provide domestic interport service. (Marad)
(2) Where cargo is carried on what is essentially a domestic
flight and therefore not subject to international agreements
that fix set rates. Cabotage rates are negotiable between
shipper and airline and apply on flights within a country and to
its overseas territories.
CAD/cash against Method of payment for goods in which documents transferring
documents title are given the buyer upon payment of cash to an
intermediary acting for the seller, usually a commission house.
CAF Abbreviation for ‘Currency Adjustment Factor.’ A charge,
expressed as a percentage of a base rate that is applied to
compensate ocean carriers of currency fluctuations. (Marad)
Cage A secure area for storing high value or high tax goods at an
air, sea cargo or freight forwarder bond/facility.
Cairns Group A group of agricultural-exporting nations comprising Australia,
Argentina, Brazil, Canada, Chile, Colombia, Fiji, Hungary,
Indonesia, Malaysia, New Zealand, the Philippines, Thailand
and Uruguay, established to develop a common negotiating
position for the Uruguay Round.
Cargo Freight loaded into a vessel/aircraft.
Cargo manifest A listing of the goods comprising the cargo (freight) carried in
a means of transport or in a transport-unit. The Cargo
manifest which gives the commercial particulars of the goods,
such as transport document numbers, consignors, consignees,
marks and numbers, number and kind of packages,
descriptions and quantities of the goods, may be used in place
of the Cargo declaration. (WCO)
Cargo tonnage Most ocean freight is billed on the basis of weight or
measurement tons (W/M). Weight tons can be expressed in
short tons of 2000 pounds, long tons of 2240 pounds or metric
tons of 1000 kilos (2204.62 pounds). Measurement tons are
usually expressed as cargo measurement of 40 cubic feet
(1.12 meters) or cubic meters (35.3 cubic feet.)
Carnet See ‘ATA carnet’
Carrier The person actually transporting goods or in charge of or
responsible for the operation of the means of transport.
(Annex A, Kyoto Convention)
Carrier, common A publicly or privately owned firm or corporation that
transports the goods of others over land, sea, or through the
air, for a stated freight rate. By government regulation, a
common carrier is required to carry all goods offered if there is
enough space, the fee is paid, and no reasonable grounds to
refuse to do so exist.
Cartage Charge for transporting goods for short distances, such as
within a commercial area or town. Also called drayage or
haulage.
Direct tax A tax that does not relate to the consumption of goods.
Includes income tax, corporation tax, capital gains tax.
Distributor A foreign agent who sells directly for a manufacturer and
maintains an inventory on hand.
Dock receipt A form used to acknowledge receipt of cargo and often
serves as basis for preparation of the ocean bill of lading.
Document Any medium designed to carry and actually carrying a
record of data entries, it includes magnetic tapes and disks,
microfilms, etc. (Annex J.1., Kyoto Convention.)
Door-to-door Through transportation of a container and its contents from
consignor to consignee. Also known as House to House. Not
necessarily a through rate.
Draft The number of feet that the hull of a ship is beneath the
surface of the water.
Draft, sight A draft payable on demand upon presentation.
Drawback The amount of import duties and taxes repaid under the
drawback procedure. (Annex F, Kyoto Convention)
Drawback The Customs procedure which, when goods are exported,
procedure provides for a repayment (total or partial) to be made in
respect of the import duties and taxes charged on the
goods, or on materials contained in them or consumed in
their production. (Annex F, Kyoto Convention)
Drawee The individual or firm on whom a draft is drawn and who
owes the stated amount to the drawer.
DRFS Abbreviation for ‘Destination Rail Freight Station.’ Same as
CFS at destination, except a DRFS is operated by the rail
carrier participating in the shipment.
Dual channel Simplified Customs control system allowing travellers on
red/green arrival to make a Customs declaration by choosing between
two types of channel. One, identified by green symbols, is
for the use of travellers carrying goods in quantities or
values not exceeding those admissible duty-free and which
are not subject to import prohibition or restriction. The
other, identified by red symbols, is for other travellers.
(WCO)
Dumping The importation of goods into a country at a price that is
less than the normal price in the country of exportation.
Dunnage Wood or other material used in stowing ship cargo to
prevent its movement.
Duties and taxes Import duties and taxes and/or export duties and taxes.
(Kyoto Convention)
Duty free shop A shop under Customs control, generally located in a sea
port or Customs airport at which travellers, proceeding
abroad, may acquire goods free of Customs duties and
taxes. (WCO)
Glossary of Customs and Trade Terms
Hague Rules, A multilateral maritime treaty adopted in 1921 (at The Hague,
The Netherlands). Standardizes liability of an international carrier
under the Ocean B/L. Establishes a legal ‘floor’ for B/L.
Harmonised The international system published by the WCO that sets out in
System (HS) systemised form the goods handled in international trade. Goods
are grouped in Sections, Chapters and sub-Chapters that are
governed by rules.
Heavy lift Very heavy cargoes that require specialized equipment to move
the products to and from ship/truck/rail/barge and terminals. This
‘heavy lift’ machinery may be installed aboard a ship designed
just for such transport (Heavy lift vessel). Shore cranes, floating
cranes and lift trucks may also be adapted for such heavy lifts.
Heavy lift Vessel specifically designed with heavy lift cranes, to handle
vessel heavy and/or out-sized cargoes.
High-risk An activity, entity or transaction that is deemed to present a high
risk to the achievement of Customs objectives.
Hub A central location to which traffic from many cities is directed and
from which traffic is fed to other areas.
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NAFTA North American Free Trade Agreement. In June 1991 the United
States, Canada and Mexico initiated negotiation of a
comprehensive free trade agreement aimed at: eliminating over a
mutually agreed upon time period all tariffs on trade between the
three countries; reducing impediments to trade in services;
removing most restrictions on foreign investment among the
signatory countries; ensuring adequate intellectual property
protection. The negotiations were concluded in August 1992, and
the draft text is structured along the lines of the U.S.-Canada Free
Trade Agreement. The Clinton administration negotiated
supplemental agreements on labour and environmental issues, and
Congress approved the whole package of NAFTA agreements in
November 1993. NAFTA went into effect January 1, 1994.
Nairobi The expression commonly used to refer to the international
Convention Convention on mutual administrative assistance for the prevention,
investigation and repression of Customs offences adopted by the
WCO in Nairobi in 1977. (WCO)
NGO Non-government organisation(s)
NMCC National maritime Coordination Centre
non tariff Barriers to an exporter to a foreign country that are not tariff/tax
barriers related and include quarantine restrictions, quota and other
restrictions such as labelling. They make the importation of the
goods into the country difficult and/or costly.
non-market A national economy in which the government seeks to determine
economy economic activity largely through a mechanism of central planning,
as in the former Soviet Union, in contrast to a market economy
which depends heavily upon market forces to allocate productive
resources. In a ‘non-market’ economy, production targets, prices,
costs, investment allocations, raw materials, labour, international
trade and most other economic aggregates are manipulated within
a national economic plan drawn up by a central planning authority;
hence, the public sector makes the major decisions affecting
demand and supply within the national economy.
NPPC National Passenger Processing Committee. ACS chairs the NPPC,
which advises on policy relating to passenger processing. It also
coordinates the activities of the nine Commonwealth departments
and agencies represented on the NPPC.
Packing list Itemised list of commodities with marks & numbers but no cost
values indicated.
Packing(s) All articles and materials used, or to be used, in the state in
which they are imported, to pack, protect, stow or separate
goods, excluding packing materials such as straw, paper,
glasswool, shavings, etc., when imported in bulk. Containers
and pallets are also excluded. (WCO)
Pallet A device on the deck of which a quantity of goods can be
assembled to form a unit load for the purpose of transporting it,
or of handling or stacking it with the assistance of mechanical
appliances. This device is made up of two decks separated by
bearers, or of a single deck supported by feet; its overall height
is reduced to the minimum compatible with handling by fork lift
trucks or pallet trucks; it may or may not have a
superstructure. (Annex B.3, Istanbul Convention.)
Partial Under letters of credit, one or more shipments are allowed by
shipments the phrase ‘partial shipments permitted.’
Particular Insurance covering partial loss or damage to goods.
average
PATCRA Papua New Guinea-Australia Trade and Commercial Relations
Agreement
Perils of the Sea Insurance covering sea water and heavy weather damage.
Person both natural and legal persons, unless the context otherwise
requires. (Kyoto Convention)
Personal effects all articles (new or used) which a traveller may reasonably
require for his or her personal use during the journey, taking
into account all the circumstances of the journey, but excluding
any goods imported or exported for commercial purposes.
(Annex J, Kyoto Convention)
Phytosanitary A certificate issued by the a Government agency (usually
Certificate Agriculture) to satisfy import regulations of foreign countries
indicating that a shipment has been inspected and found free
from harmful pests and plant diseases.
Pilferage Partial loss of the contents of a package through theft.
Pilot (ship’s) A licensed navigational guide with thorough knowledge of a
particular section of a waterway whose occupation is to steep
ships along a coast or into and out of a harbour. Local pilots
board the ship to advise the captain and navigator of local
navigation conditions (difficult currents; hidden wrecks, etc.).
Plimsoll Line A series of horizontal lines, corresponding to the seasons of the
year and fresh or saltwater, painted on the outside of a ship
marking the level which must remain above the surface of the
water for the vessel's stability.
PNR Passenger Name Record (as used by airlines)
Postal items Letter-post and parcels, as described in the Acts of the
Universal Postal Union currently in force, when carried by or for
postal services. (Annex J, Kyoto Convention)
postal parcels Items called postal parcels within the meaning of the Acts of
the Universal Postal Union currently in force. (WCO)
Postal service a public or private body authorized by the government to
provide the international services governed by the Acts of the
Universal Postal Union currently in force. (Annex J, Kyoto
Convention)
PPB PPB Global Logistics
Pratique Lifts temporary quarantine of a vessel; granted pratique by
Health Officer.
Precursor A substance containing ephedrine or pseudoephedrine used in
the manufacture of methamphetamine.
Preference Special advantages extended by importing countries to exports
from particular trading partners, usually by admitting their
goods at tariff rates below those imposed on imports from other
supplying countries.
Preference (or A lower duty rate based on the value of the goods dependent
Preferential) on the country of origin.
duty
Prepaid Freight charges on a B/L or air waybill that are paid at origin.
Prima facie Latin, ‘on first appearance’. When a steamship company issues
a clean bill of lading, it acknowledges that the goods were
received ‘in apparent good order and condition’ and this is said
by the courts to constitute prima facie evidence of the
conditions of the containers; that is, if nothing to the contrary
appears, it must be inferred that the cargo was in good
condition when received by the carrier.
Pro Forma A Latin term meaning ‘For the sake of form.’
Pro Forma An invoice provided by a supplier prior to the shipment of
Invoice merchandise, informing the buyer of the kinds and quantities of
goods to be sent, their value, and specifications (weight, size,
etc.).
Pro Rata A Latin term meaning ‘In proportion.’
Prohibited Goods the importation or exportation of which is forbidden by
goods law. (WCO)
Promissory Note A signed statement containing a written promise to pay a
stated sum to specified person at a specified date or on
demand.
Q-R
Tally sheet Record of incoming and out going cargo being recorded during
discharge or loading by a Tally Clerk on a wharf.
Tanker Ships fitted with tanks to carry liquid cargo such as: crude
petroleum and petroleum products; chemicals, Liquefied gasses
(LNG and LPG), wine, molasses, and similar product tankers.
Tare Tare weight is the weight of the packing materials (without the
goods). Net weight + tare weight = gross weight.
Target A particular activity, entity or transaction that is selected for
specific Customs scrutiny.
Targeted Is carried out as a result of intelligence, and is supported by an
Operational operational response plan.
Response
Tariff A duty (or tax) levied upon goods transported from one
customs area to another either for protective or revenue
purposes. Tariffs raise the prices of imported goods, thus
making them generally less competitive within the market of
the importing country unless the importing country does not
produce the items so tariffed. After seven ‘Rounds’ of GATT
trade negotiations that focused heavily on tariff reductions,
tariffs are less important measures of protection than they used
to be. The term ‘tariff’ often refers to a comprehensive list or
‘schedule’ of merchandise with the rate of duty to be paid to
the government for importing products listed, whereas the term
‘duty’ applies only to the rate applicable to an individual tariff
item.
Tariff ceiling Any pre-set value or quantity, authorized for importation or
exportation of given goods, during a specified period, with a
reduction of the normal Customs duties, and beyond which the
granting of the said tariff reduction may be suspended until the
end of the period in question. (WCO)
Tariff Determination of the tariff subheading in a tariff nomenclature
classification of under which particular goods should be classified. (WCO)
goods
Tariff Description of an article or product in accordance with the
description terminology used in the tariff nomenclature. WCO)
Tariff heading The textual designation in a tariff nomenclature of a single
(or subheading) commodity or a single group of related commodities. Note: for
ease of reference, each tariff heading (or subheading) is
identified by a code number which is used, inter alia, for the
purposes of Customs declarations. (WCO)
Tariff item In certain countries the term ‘tariff item’ is used instead of
‘tariff heading’.
Tariff Any classification and coding system introduced by national
nomenclature administrations or Customs or Economic Unions to designate
commodities or groups of related commodities for Customs
tariff purposes. (WCO)
Tariff quota See ‘quota, tariff’
Temporary The Customs procedure under which certain goods can be
admission brought into a Customs territory conditionally relieved from
payment of import duties and taxes; such goods must be
imported for a specific purpose and must be intended for re-
exportation within a specified period and without having
undergone any change except normal depreciation due to the
use made of the goods. (Annex J, Kyoto Convention)
TEU See Twenty-foot Equivalent Unit.
Through rate The total freight rate from the point of origin to final
destination.
Tractor A vehicle usually with 4 or more wheels used to haul trailers/
semi trailers on highways.
Trade free zone a part of the territory where imported goods are regarded as
being outside the Customs territory for the purposes of import
duties and taxes.
Trademark A trademark is a name, symbol, word or some other device
used in relation to goods to indicate the source or manufacturer
so they will be distinguished from similar items.
Transaction Thr price actually paid or payable
value
Transhipment The Customs procedure under which goods are transferred
under Customs control from the importing means of transport
to the exporting means of transport within the area of one
Customs office which is the office of both importation and
exportation. (Annex E, Kyoto Convention)
Transtainer A type of crane used in the handling of containers, which is
motorized, mounted on rubber tires and can straddle at least
four railway tracks, some up to six, with a lifting capacity of 35
tons for loading and unloading containers to and from railway
cards.
Traveller (1) any person who temporarily enters the territory of a
country in which he or she does not normally reside (‘non-
resident’) or who leaves that territory; and
(2) any person who leaves the territory of a country in which he
or she normally resides (‘departing resident’) or who returns to
that territory (‘returning resident’). (Annex J, Kyoto
Convention)
TRIPS Trade-Related Aspects Of Intellectual Property Rights.
Government regulations or administrative procedures--or the
lack thereof--which diminish or deny intellectual property
protection. Under the Uruguay Round accord of December
1993, GATT member countries agreed to a comprehensive set
of international rules and stronger measures at international
borders to stop trade in goods that infringe on intellectual
property rights. Under the TRIPS agreement, nations are
obliged to rewrite national laws to make them conform to
internationally agreed norms for the protection of patents,
trademarks, copyrights, industrial designs, trade secrets,
integrated circuits (semiconductor chip mask works), and
geographical indications. It also broadens the areas of
protection to include technological areas--such as
pharmaceutical products, computer software, and inventions
and works arising from new technologies--that are not currently
protected in many countries.
Twenty-foot The standard measure used for container carrying capacity in
Equivalent Unit terms of a 8 x 8 x 20 foot container.
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