bg thu tin thuong mai chapter 10 5826

CHAPTER 10:Transportation and shipping Road, rail and air transport and documentation; organizations, shipping documentation and insurance, forwarding agents; container services and docu

CHAPTER 10:

Transportation and shipping

Road, rail and air transport and documentation;

organizations, shipping documentation and insurance, forwarding agents); container services and documentation; chartering ships.

Road transport

• Road transport tends to be comparatively cheaper and more direct than rail, and in the past few years haulage (trucking) has doubled in the UK

• Reasons:

+ the increased capacity for lorries to carry goods, particularly with the introduction of containers

+ faster services, with road improvements (motorways)

+ accessibility abroad with ferries offering rolling – on and rolling – off facilities

Rail transport

• Rail transport is faster than road, which is necessary especially whentransporting perishable goods, i.e fish, fruit, meat, etc., and can haulbulk commodities (oil, grain, coal) in greater volume than roadtransporters

• There is a link between road and rail through companies such asFreightliners, but transshipment (transferring goods from train totruck) can still be a problem

• Rail transport tends to be comparatively more expensive than roadhaulage

Air transport

• Air transport is used for speed, particularly over long distances Insurance tends to be cheaper as consignments spend less time in transit.

expensive, and can be uneconomical.

• The main document used is the Air Waybill (AWB), which

consists of 12 copies distributed to the airline, exporter, importer, and customs.

• The Air Waybill is only a receipt and cannot be transferred to another person.

• Consignment notes are used in road and rail transportation.

They are not negotiable, cannot be bought, sold, transferred

by the consignor (the exporter), or the consignee (the

importer).

consignor filling out an instructions for dispatch form, and paying the freight charges which are calculated in size (volume), weight, or value, and sometimes risk, particularly its special precautions have to be taken.

• Most freight companies are private carriers, which means

they are only responsible for negligence (note taking proper

care of the goods).

• In the Economic Community, and European Free Trade Area (EFTA)

movement certificates are used especially for container shipments, if

the consignment is taken through different customs posts to membercountries

• Since the late 1980s many of these customs forms have been

included in one document, the Single Administrative Documents

(SAD) an eight – part set of forms for export declarations In addition

the Simplified Clearance Procedure (SCP) is also used to make

documentation easier for exports and agents

• Correspondence in transport is generally between the sellers andfreight firms, or sellers and freight firms, or sellers and forwardingagents, who send goods on behalf of the seller The customers arekept informed by advice notes which give details of packing andwhen goods will arrive

Documentation Letter requiring the quotation

Specimen letters

Quotation for delivery by road

Specimen Letters

Advice of delivery

Specimen Letters

Complaint of damage in delivery

Specimen Letters

Reply to

complaint of damage

Specimen Letters

Complaint to the carrier

Specimen Letters

Quotation for delivery by air

Specimen Forms

Air Waybill

• Passenger liners are ships that follow scheduled routes

and concentrate on passenger services, but also carrycargo

• Passenger cargo vessels concentrate on cargoes, offer

more facilities for loading and unloading, but carry fewpassengers

• Tramps travel anywhere in the world on unscheduled

routes, picking up any cargo and delivering it

• Tankers are usually oil carriers, and are like bulk carriers

which transport bulk consignments such as grain,wheat, and ores.

Types of vessels

• Container vessels offer facilities to move containers

from one country to another, and have special lifting gear and storage space for the huge steel boxes they transport

• Roll – on roll – off ferries are vessels which allow

cars and trucks to drive on at one port and off at another without having to load and unload their freight

• There are also barges, large flat – bottomed boats,

which transport goods inland along canals and

waterways, and lighters which may do the same

work as a barge, or are used for taking goods from

a port out to a ship, or vice versa

Types of vessels

Shipping organizations

• The shipping Conference is an international organization of ship

owners who have agreed to fix prices for transporting goods andpassengers The advantage for their customers is that the costs ofshipment are steady They can also claim rebates (discounts) byshipping in bulk A similar body to the Shipping Conference can be

found in airlines – IATA, International Air Transport Association.

• The Baltic Exchange has a number of functions, but its freight

market offers facilities to exporters to charter (hire) ships and planesthrough brokers, who work on a commission and are specialists with

a knowledge of the movement of ships and the most competitiverates available at any one time

Shipping documentation

• A freight account is an invoice sent by the shipping company to the

exporter stating their charges

• Once the goods are received on the dock, a shipping note , with a

receipt, is handed to the Superintendent of the docks, advising him that the goods are stored and awaiting shipment

• Once the goods are on board the ship, a mate’s receipt may be sent,

acknowledging that the goods have been loaded The mate’s receipt

is often sent when the consignment is loaded directly, and serves as a document of title until the bill of lading is ready

Shipping documentation

+ The bill of lading is the most important document in shipping as it is a document

of title, i.e gives ownership of the goods to the person named on it.

+ If the words ‘to order’ are written on it, it means that it is a negotiable document and can be traded

+ In this case it will be endorsed on the back (the exporter will sign it), and if the endorsement is blank, there will be no restrictions on ownership

+ In an l/c transaction the confirming bank will usually ask for the b/l to be made out

of them when they pay the exporter, then transfer it to the customer.

Shipping documentation

• A shipped bill of lading means that the goods have been loaded on to the ship

Sometimes the world’s shipped on board’ are used to mean the same thing

• In c.i.f and c.&f transactions the words ‘freight prepaid’ are used to signify that the costs of shipment have been paid.

• Bills are also marked ‘clean’ to indicate that the goods were taken on board in good condition, or ‘dirty/claused’ to indicate that on inspection there was found

to be something wrong with the consignment, e.g packing, or the goods were damaged

• This statement protects the shipping company from claims that they were

responsible for the damage or bad condition of the consignment

Shipping liabilities

The Hague Rules signed at the Brussels Convention in 1924 govern liability for loss

or damage to cargo carried by sea under a bill of lading, and state that the carrier

will not be responsible under the following conditions:

• Acts of war, riots, civil disturbances;

• Force majeure, i.e exceptional dangers such as storms, abnormal disturbances, or

unusual hazards;

• Negligence, i.e when the goods have not been properly packed, or were in a bad

condition when packed;

• Inherent vice, i.e when goods are subject to deterioration because of their

content or nature For example, fish can go bad, wood can carry insects, metal can oxidize.

The Hamburg Rules of 1978 have extended the shipping companies’ liability for

damage or delay to ‘goods in their charge’ unless they can prove they took all

measures to avoid problems.

• Many forwarding agents in importing countries also act as clearing agents,

ensuring that the goods are cleared through the customs and are sent to the importer.

Specimen Letters

Request for freight rates and sailings

Specimen Letters

Bill of lading

Specimen Letters

Instroduction to

a forwarding

agent

Specimen Letters

Forwarding agent’s

enquiry for

freight rates

Specimen Letters

Shipping

company’s reply

Specimen Letters

Confirmation

of shipment

Specimen Letters

Advice of shipment

to importer’s forwarding agent

Specimen Letters Advice of shipment

to importer

Specimen Letters

Delay in arrival

of shipment

Specimen Letters

Shipping

company’s reply

Container services

• Container are large steel boxes, 20 to 40 feet in length, can hold mostcargoes including liquids, and are transported by lorries or trains toports where they are loaded on to container vessels and shipped.Because of their sealing to prevent pilfering they are safe, and goodsare also protected against constant handling

• Small parcels from different shippers can be grouped together(consolidation) at a depot if they are for the same destination, andspecial groupage rates are offered to consignees

• Most ports in the world have facilities for loading and unloadingcontainers, and if they do not have them, the container can bedelivered to a port with facilities, then loaded on to trucks and taken

to customer

Documentation for exporting

goods by container

• A bill of lading can be used as it is in ordinary shipments, with the

usual condition applying, i.e a clean shipped on board bill, namingthe port of acceptance (where the goods have been loaded) and port

of delivery (where the goods will be unloaded.) In this case theshipping company only accepts responsibility for the goods while on

board ship But if a combined transport bill of lading is used, the place

of acceptance and place of delivery may be covered, which means thecompany accepts door – to – door responsibility, which offers moreextensive cover than the bill of lading

• Non-negotiable waybills are also used, but unless instructed, banks

will not accept them as evidence of shipment, and they are notdocuments of title which can be transferred

Documentation for importing

goods by container

• A freight invoice is needed if the sea freight is to be paid in the UK

and is accompanied by an arrival notification form, which advises

the importer that his goods are coming On claiming his goods, the

customer has to show a customs clearance form, which allows the goods to be taxed, copies of the certificate of origin, if necessary,

commercial invoices, import licence, and health certificate for food or

Chartering ships

• Voyage charter charges, i.e taking freight from port A to B, are

calculated on the tonnage value of the cargo For example, if anexporter ships 500 tons of coal at £1.2 per ton, he will pay £600 forthe charter

• Time charter charges are calculated on the tonnage for the ship (i.e.

the weight of the ship) plus running costs of the vessel, excludingwages So the larger the ship, the more the charterer pays, regardless

of whether he ships 500 tons or 5000 tons

• There are also mixed charters combining both time and voyage charters The contract signed by both parties is known as a charter

party.

Specimen letters

Enquiry to

a container company

Specimen letters

Container company’s reply

Specimen letters

Certificate of origin

Specimen letters

Enquiry for

a time charter

Specimen letters

Shipbroker’s

reply

Specimen letters Rail consignment

note

Specimen letters Enquiry for

a voyage charter

Specimen letters

Shipbroker’s

reply

Specimen letters

General charter

Points to remember

1 The method a consignor chooses to deliver his goods depends on whether his main consideration is

speed, direct delivery, limiting handling, or economy, and this obviously relates to the type of consignment being sent.

2 Road haulage can be comparatively cheap when transporting relatively small consignments, and offers a door – to – door service Rail freight services are competitive when shipping bulk goods, and are faster than road transport between terminals Air transport offers the fastest service, but is restrictive on weight and volume, and can be the most expensive method of sending goods.

3 The ‘consignment note’ or ‘waybill’ is the main document used in road, rail, or air transport It is a receipt, not a document of title, and therefore not negotiable An ‘advice not’ is usually sent to the consignee to

inform him that goods are being forwarded, but airlines, as a rule, inform the consignee themselves when the goods arrive.

4 There are various types of vessels available to carry different goods Their owners may belong to the Shipping Conference and will charge fixed rates for transporting goods.

5 Other vessels can be chartered, on a time or voyage basis or on a mixed charter, through shipbrokers on the Baltic Exchange who will negotiable rates for their clients.

6 The bill of lading is the main document used in shipping and may be ‘clean’ or ‘dirty’ (‘claused’) which explains whether the goods were taken on board in perfect condition, or if something was wrong with

them Once the bill has been signed by the captain, it is known as a shipped bill and the shipping company

will now accept responsibility in accordance with the clauses on the back of the document If the bill is made ‘to order’ it becomes a negotiable document of title.

7 Containerization is a rapidly growing method of shipment, where goods are loaded into steel boxes

which are taken to the docks and then loaded on to special vessels Container companies use either

combined transport bills of lading, or waybills, but also the usual documents in shipping including the bill of

lading.