Shipping & Freight Glossary
60+ international shipping and logistics terms explained — from AWB and B/L to Incoterms, HS codes and volumetric weight.
A
Air Waybill (AWB)
The transport document for air freight shipments. An 11-digit number identifies every air shipment: 3-digit airline code + 8-digit serial number. The AWB is the contract between shipper and airline carrier and serves as a receipt for the goods.
ATD (Actual Time of Departure)
The real departure time of a vessel or aircraft, as opposed to the scheduled departure time (ETD). Used in sea freight tracking.
ATA / ATA Carnet
An international customs document that allows temporary importation of goods without paying customs duties. Used for exhibition samples, professional equipment and trade fairs.
B
Bill of Lading (B/L)
The primary transport document for sea freight. It is simultaneously a receipt for goods, a contract of carriage, and a document of title (for negotiable B/Ls). There are two types: Straight B/L (non-negotiable, named consignee) and Order B/L (negotiable, used in trade finance).
Bonded Warehouse
A customs-controlled storage facility where imported goods can be held without paying import duties until they are released for local sale or re-exported. Used for goods awaiting clearance or distribution.
Break-Bulk Cargo
Cargo that is not containerised — loaded piece by piece onto a vessel. Examples include large machinery, steel coils, timber and project cargo. Contrast with containerised or bulk cargo.
C
CBM (Cubic Metre)
The unit of volume used to measure cargo in sea freight. 1 CBM = 1m × 1m × 1m. LCL sea freight is priced per CBM. To calculate: Length (m) × Width (m) × Height (m) = CBM.
CFS (Container Freight Station)
A facility where LCL (less than container load) cargo from multiple shippers is consolidated into one container for shipping. At destination, the container is deconsolidated and individual shipments collected.
Consignee
The person or company named on the shipping document as the recipient of the goods. The consignee is responsible for accepting delivery and typically for import customs clearance (under DAP, FCA and most Incoterms).
Consignor / Shipper
The person or company sending the goods — the exporter. The shipper is named on the airway bill, bill of lading or courier label as the sender.
Customs Clearance
The process by which goods are declared to customs authorities of the importing country, duties and taxes are assessed and paid, and import permission is granted. Required for all international shipments crossing non-EU borders.
D
DAP (Delivered at Place)
An Incoterm 2020 term. The seller delivers goods to a named destination. Risk transfers at the destination. The buyer pays import duties and taxes. Standard for most courier shipments internationally.
DDP (Delivered Duty Paid)
An Incoterm 2020 term. The seller covers all costs including import duties — the buyer receives goods with no extra charges. Maximum seller responsibility.
De Minimis
The value threshold below which no import duties are charged. EU de minimis: €150 (customs duty), VAT still applies. UK: £135. USA: $800. Shipments below this value in most countries clear customs without duty.
Demurrage
A charge levied by shipping lines when containers are not returned to the port within the free time allowance. Also used in bulk shipping for vessel delay charges.
E
ETA (Estimated Time of Arrival)
The expected arrival date and time of a vessel, aircraft or truck at its destination. Used in sea freight schedules and courier tracking.
ETD (Estimated Time of Departure)
The scheduled departure date of a vessel or aircraft from its origin or transshipment port.
EORI Number
Economic Operators Registration and Identification number. Required for companies in the EU (and UK post-Brexit) to import or export goods commercially. Issued by national customs authorities (AT in Portugal).
EXW (Ex Works)
An Incoterm where the seller's obligation ends at their premises. The buyer arranges and pays for everything from collection onwards, including export customs.
F
FCL (Full Container Load)
A sea freight container used exclusively by one shipper. A 20-foot container (TEU) holds approximately 25–28 CBM. A 40-foot container holds 55–67 CBM. FCL is more cost-effective than LCL for large volumes.
FOB (Free on Board)
An Incoterm (sea only) where the seller loads goods onto the vessel. Risk transfers when goods are on board at the export port. The buyer pays ocean freight and import costs.
Freight Forwarder
A company that arranges the transport of goods on behalf of shippers, often combining multiple services: booking cargo space, customs clearance, documentation, and port handling. Acts as an intermediary between shipper and carriers.
Fuel Surcharge (FSC/BAF)
A variable surcharge added to freight rates to account for fuel costs. BAF (Bunker Adjustment Factor) for sea freight, FSC (Fuel Surcharge) for couriers and air freight. Typically 5–25% of the base rate, fluctuating with oil prices.
G
General Average
A maritime legal principle: if a ship is in danger and cargo is sacrificed to save the vessel, all cargo owners (not just those whose cargo was lost) share the financial loss proportionally. Cargo insurance protects against general average contributions.
GRI (General Rate Increase)
A scheduled increase in sea freight base rates announced by shipping lines, typically 30–60 days in advance. GRIs affect all FCL and LCL bookings on the named trade lanes from the effective date.
H
HS Code (Harmonised System Code)
A 6-digit internationally standardised code that classifies every traded product. Used on customs declarations worldwide. The first 6 digits are global; countries add further digits for local tariff purposes. Example: 6204.62 = women's cotton trousers.
HAWB (House Air Waybill)
An air waybill issued by a freight forwarder to the individual shipper. The forwarder consolidates multiple HAWBs under a single Master Air Waybill (MAWB) with the airline.
HBL (House Bill of Lading)
A bill of lading issued by a freight forwarder to the shipper, as opposed to the ocean bill of lading issued directly by the shipping line. Used in LCL consolidation.
I
IATA (International Air Transport Association)
The trade association of the world's airlines. IATA sets standards for dangerous goods (DG) shipments by air, including the Dangerous Goods Regulations (DGR) that govern how restricted items like lithium batteries and perfumes can be shipped.
Incoterms
International Commercial Terms — a set of 11 standardised trade terms published by the International Chamber of Commerce (ICC) that define the responsibilities of buyers and sellers in international trade (costs, risk transfer, customs).
IOSS (Import One-Stop Shop)
An EU VAT scheme for non-EU e-commerce sellers shipping goods under €150 to EU consumers. Sellers collect VAT at point of sale and remit to EU via a single registration, allowing parcels to clear customs without additional VAT charges at the border.
L
LCL (Less than Container Load)
Sea freight where your cargo shares a container with other shippers' goods. You pay only for the CBM your cargo occupies. Minimum is typically 1 CBM. Used for small-volume sea freight that doesn't fill a full container.
Lead Time
The total time from placing an order to receiving goods. In logistics, it includes production time, booking time, transit time and customs clearance time. Lead time planning is essential for inventory management.
Lien
A carrier's legal right to hold cargo until freight charges are paid. If a shipper fails to pay freight costs, the carrier can exercise a lien on the goods.
M
Manifest
A document listing all cargo on a vessel, aircraft or truck. The customs manifest is filed with authorities at departure and arrival ports and declares the contents, weight, origin and destination of all consignments.
MAWB (Master Air Waybill)
The air waybill issued by the airline to the freight forwarder for a consolidated air freight shipment. The MAWB covers the entire consolidated load; individual shipper shipments have their own House Air Waybills (HAWBs).
N
Notify Party
A party (other than the consignee) to be notified when a shipment arrives — typically the buyer's customs broker or freight forwarder. Listed on the bill of lading or air waybill.
NVP (No Value Parcel)
A postal/courier term for parcels declared with no commercial value. NVP declarations are improper for commercial shipments — customs authorities treat them as suspicious and subject them to additional scrutiny.
O
On Carriage
Transport of goods from the port or airport of arrival to the final inland destination. The onward leg after the main international transport has been completed.
Origin Certificate
A document certifying where goods were manufactured or substantially transformed. Types include EUR.1 (EU preferential origin), A.TR (Turkey), Certificate of Origin (generic), and REX Statement on Origin. Used to claim preferential duty rates under trade agreements.
P
POD (Proof of Delivery)
A document or electronic record confirming that a shipment was delivered, including the name, signature and time of the recipient. Essential for resolving delivery disputes and insurance claims.
Port of Discharge (POD)
The port where cargo is unloaded from the vessel. Not to be confused with Proof of Delivery (same abbreviation — context distinguishes them).
Phytosanitary Certificate
An official certificate issued by a country's plant health authority confirming that plants or plant products meet the importing country's import requirements. Required for many agricultural goods exported from Portugal.
R
Remittance / Freight Collect
A shipping arrangement where the freight charges are paid by the recipient (consignee) rather than the sender. Most courier shipments are freight prepaid (sender pays); freight collect is more common in B2B freight.
Remote Area Surcharge
An additional charge applied by couriers and freight carriers for deliveries to locations with limited access — rural areas, islands, mountains. In Portugal, deliveries to Azores and Madeira attract significant remote area surcharges.
S
Shipper's Letter of Instruction (SLI)
A document provided by the shipper to their freight forwarder authorising the forwarder to arrange the shipment and prepare export documentation on their behalf.
SI Cut-Off (Shipping Instructions)
The deadline by which shippers must submit final cargo details (consignee, commodity, weight, marks) to the freight forwarder or shipping line for a specific vessel sailing.
T
TEU (Twenty-foot Equivalent Unit)
The standard unit for measuring container capacity. A standard 20-foot container = 1 TEU. A 40-foot container = 2 TEU. Port capacity and vessel size are measured in TEU.
Transit Time
The time from collection of cargo by the carrier to delivery at the destination. Does not include customs clearance time (which is separate and variable) unless specified as 'door-to-door' time.
Transshipment
The transfer of cargo from one vessel or aircraft to another at an intermediate port, before continuing to the final destination. Common on longer sea freight routes (e.g. Lisbon to Singapore might transship at Rotterdam and Singapore).
V
Volumetric Weight
A pricing method used by couriers when the space a parcel occupies is more valuable than its actual weight. Formula: L × W × H (cm) ÷ 5000 = volumetric weight (kg). Carriers charge the greater of actual vs volumetric weight.
VAT IOSS
See IOSS. The EU Import One-Stop Shop VAT scheme for e-commerce shipments under €150.
W
Waybill
A generic term for a shipping document — either an Air Waybill (AWB) for air freight or a Sea Waybill for ocean freight. Unlike a Bill of Lading, a waybill is not a document of title and cannot be traded.
Weight Break
A pricing threshold in courier and freight pricing. As shipment weight increases past a break (e.g. 5 kg, 10 kg, 20 kg), the per-kg rate decreases. Understanding weight breaks allows shippers to consolidate cargo to fall into a more economical tier.
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