Shipping & Freight Glossary
120+ 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.
Ad Valorem Duty
A customs duty calculated as a percentage of the declared value of the goods, rather than a fixed amount per unit or weight. The vast majority of import duties worldwide are ad valorem.
Arrival Notice
A notification sent by the carrier or freight forwarder to the consignee or notify party confirming that a shipment has arrived at the destination port or airport and is ready for customs clearance and collection.
AEO (Authorized Economic Operator)
An EU customs certification for businesses with a proven track record of compliance and security. AEO status brings faster customs clearance and fewer physical/document-based inspections.
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.
Bonded Carrier
A carrier authorised by customs authorities to transport goods that have not yet cleared customs, under a bond guaranteeing the duties owed if the goods are diverted before clearance.
Booking Confirmation
A carrier or forwarder's written confirmation that space has been reserved for a specific shipment on a named vessel, flight or road service, including the booking reference number.
Bulk Cargo
Unpackaged cargo shipped in large quantities, loaded directly into a vessel's hold rather than in containers or break-bulk units — grain, coal and ore are classic examples.
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.
Cargo Manifest
A summary document listing every consignment loaded onto a specific vessel, flight or vehicle, filed with customs authorities at both origin and destination.
Certificate of Origin
A document certifying the country in which goods were manufactured, used by customs to determine applicable duty rates, especially preferential rates under trade agreements.
Chargeable Weight
The weight used to calculate freight charges — the greater of actual gross weight and volumetric (dimensional) weight. Also called billable weight.
CIF (Cost, Insurance and Freight)
An Incoterm (sea/inland waterway only) where the seller pays cost, insurance and freight to the named port of destination. Risk transfers once goods are loaded on the vessel.
CIP (Carriage and Insurance Paid To)
An Incoterm 2020 term usable for any transport mode. The seller pays carriage and insurance to a named destination; risk transfers once goods are handed to the first carrier.
Commercial Invoice
The primary customs document for a shipment, stating the seller, buyer, goods description, HS code, quantity, unit price, total value and Incoterm. Required for all commercial international shipments.
Container Yard (CY)
A facility at a port or inland terminal where full containers are received from or delivered to shippers, carriers and consignees for onward transport.
CPT (Carriage Paid To)
An Incoterm 2020 term usable for any transport mode. The seller pays carriage to a named destination; risk transfers once goods are handed to the first carrier, before arrival.
Cross-Docking
A logistics practice where incoming goods are unloaded from one vehicle and loaded directly onto outbound vehicles, with little or no warehouse storage in between.
Customs Bond
A financial guarantee, typically issued by an insurance company, ensuring customs duties and penalties will be paid even if the importer defaults. Common for regular commercial importers in the USA.
Customs Broker
A licensed professional or firm that prepares and submits customs declarations on behalf of importers/exporters, ensuring compliance with the destination country's import regulations.
Cut-Off Time
The latest time cargo, documents or booking instructions can be submitted for a specific sailing, flight or collection to guarantee inclusion in that shipment.
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.
Dangerous Goods (DG)
Goods classified as posing a risk to health, safety or property during transport — lithium batteries, aerosols, flammable liquids and corrosives are common DG categories requiring special declaration and packaging.
Dead Freight
Compensation paid by a shipper to a carrier for cargo space that was booked but not used — effectively a penalty for under-shipping against a confirmed booking.
Delivery Order (D/O)
A document issued by the carrier or its agent authorising the release of goods to the consignee or their nominated agent, typically issued once freight charges are settled.
Detention
A charge for keeping a container beyond the allowed free time outside the port — as opposed to demurrage, which applies while the container is still within the port or terminal.
Door-to-Door
A shipping service covering the entire journey from the sender's address to the recipient's address, including all handling in between, as opposed to port-to-port or airport-to-airport service.
Drayage
The short-distance transport of containerised cargo, typically between a port or rail terminal and a nearby warehouse or distribution centre.
Duty Drawback
A refund of import duties paid on goods that are subsequently exported or used to manufacture exported products, available in many jurisdictions to avoid double taxation on re-exported goods.
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.
Export Declaration
A document filed with customs authorities in the country of origin, declaring the details of goods leaving the country — required for most commercial exports above a value threshold.
Export License
Government authorisation required to export certain controlled goods — dual-use technology, military items, or goods subject to trade sanctions — before shipment can legally proceed.
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.
FAS (Free Alongside Ship)
An Incoterm (sea only) where the seller delivers goods alongside the vessel at the port of shipment. Risk transfers once goods are placed alongside the ship, before loading.
FCA (Free Carrier)
An Incoterm 2020 term usable for any transport mode. The seller delivers goods to a carrier or location nominated by the buyer; risk transfers at that point.
Force Majeure
A contract clause excusing a party from liability for failing to perform obligations due to extraordinary circumstances beyond their control — natural disasters, war, or government action.
Free Time
The period during which a container or cargo can remain at a port, terminal or with the consignee without incurring demurrage or detention charges.
Freight Class
A classification system (notably the US NMFC — National Motor Freight Classification) used to determine LTL (less-than-truckload) freight rates based on density, handling and liability.
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.
Gross Weight
The total weight of goods including all packaging — box, pallet and dunnage — as opposed to net weight, which excludes packaging.
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.
Harmonized Tariff Schedule (HTS)
A country-specific extension of the international HS code system used to determine exact import duty rates — for example, the USA's 10-digit HTSUS codes.
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.
Import License
Government authorisation required before certain regulated goods — pharmaceuticals, firearms, some agricultural products — can be legally imported into a country.
Inland Haulage
Transport of cargo overland between an inland point (factory, warehouse) and a port or airport, or between two inland points, as part of a wider international shipment.
Insurance Certificate
A document evidencing cargo insurance coverage for a specific shipment, often required by banks under letter-of-credit trade finance arrangements.
J
Just-In-Time (JIT)
A supply chain strategy where components or goods are delivered exactly when needed in the production or sales process, minimising inventory holding costs but requiring highly reliable, time-definite logistics.
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.
Landed Cost
The total cost of a shipped product once it arrives at its destination — including the product price, freight, insurance, customs duty, taxes and handling fees.
Letter of Credit (L/C)
A bank-issued payment guarantee used in international trade, where the bank pays the seller on the buyer's behalf once specified shipping documents are presented, reducing payment risk for both parties.
Loading Dock
A designated area at a warehouse or distribution centre where trucks load and unload cargo, typically raised to truck-bed height for efficient handling.
Logistics Provider (3PL)
A third-party logistics company that manages some or all of a business's supply chain functions — warehousing, transport, fulfilment — on an outsourced basis.
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).
Marine Insurance
Insurance covering loss or damage to goods during transport by sea, air or land — despite the name, marine insurance policies typically cover the full multimodal journey, not just the ocean leg.
Milk Run
A logistics route where a single vehicle makes multiple pickups or deliveries at different locations in sequence, rather than a single direct point-to-point trip — improves vehicle utilisation.
Multimodal Transport
A single shipment carried by more than one mode of transport (e.g. sea then road) under one contract and one document of carriage, with one party taking overall responsibility.
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.
Net Weight
The weight of goods alone, excluding all packaging materials — contrast with gross weight, which includes packaging.
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.
Ocean Bill of Lading
A bill of lading issued directly by an ocean carrier (as opposed to a House Bill of Lading issued by a freight forwarder), evidencing the contract of carriage by sea.
Order Fulfillment
The complete process of receiving, processing, picking, packing and shipping a customer order — a core function of e-commerce logistics and third-party fulfilment providers.
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.
Packing List
A document itemising the exact contents, dimensions and weight of each package in a shipment, used by customs, carriers and the consignee to verify what was actually shipped.
Pallet (EUR-Pallet)
A flat transport structure supporting goods for handling by forklift or pallet jack. The EUR-pallet (EPAL), standard in Europe, measures 120×80cm with a maximum load of 1,000kg.
Pre-Alert
A notification sent by the shipper or forwarder to the destination agent or consignee ahead of a shipment's arrival, containing tracking numbers and shipment details so the receiving party can prepare.
Proforma Invoice
A preliminary invoice sent before a shipment, stating the estimated price and terms of a sale — used for customs pre-clearance, import licence applications or as a quote, but not for final payment.
Q
Quota (Import Quota)
A government-imposed limit on the quantity of a specific good that can be imported into a country during a given period, used to protect domestic industries or manage trade relationships.
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.
Reefer Container
A refrigerated shipping container used to transport temperature-sensitive cargo — food, pharmaceuticals, flowers — maintaining a controlled temperature throughout transit.
Restricted Party Screening
The process of checking a shipment's buyer, consignee and end-user against government sanctions and denied-party lists before export, to ensure compliance with trade sanctions law.
RMA (Return Merchandise Authorization)
An authorisation number issued by a seller to a customer permitting the return of goods, used to track and process returns and refunds systematically.
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.
Safety Data Sheet (SDS)
A standardised document providing information on the properties, hazards and safe handling of a chemical or hazardous substance — required documentation for shipping most dangerous goods.
Sea Waybill
A non-negotiable transport document for sea freight, similar to a Bill of Lading but not a document of title — goods are released to the named consignee without needing to present an original document.
Stuffing
The process of loading cargo into a shipping container, typically at a factory, warehouse or Container Freight Station — the reverse process at destination is called 'stripping' or 'devanning'.
Supply Chain
The full network of organisations, people, activities and resources involved in moving a product from raw material to end customer — sourcing, manufacturing, logistics and distribution.
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).
Tail-Lift Delivery
A delivery service using a vehicle fitted with a hydraulic platform (tail-lift) at the rear, allowing heavy or palletised goods to be lowered to ground level without a loading dock at the recipient's address.
Tare Weight
The weight of an empty container, vehicle or packaging alone, without any cargo — used together with gross weight to calculate net cargo weight.
Third-Party Logistics (3PL)
See Logistics Provider — an outsourced provider handling warehousing, transport and/or fulfilment functions on behalf of a business.
Trade Compliance
The practice of ensuring international shipments meet all applicable export controls, sanctions, customs regulations and product-specific import requirements.
U
Ullage
The empty space in a container or tank that is not filled with cargo, typically expressed as a percentage — relevant for liquid bulk cargo and for calculating loading efficiency.
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.
Vessel Manifest
The official list of all cargo, containers and their details loaded on a specific vessel voyage, filed with customs at both the port of loading and the port of discharge.
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.
Warehouse Receipt
A document issued by a warehouse operator acknowledging receipt of goods into storage, sometimes used as collateral for trade financing.
White Glove Delivery
A premium delivery service that includes additional handling such as room-of-choice placement, unpacking, assembly or installation — commonly used for furniture and appliances.
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