Export Import Glossary: Shipping, Customs and Trade Terms Explained

Incoterm where the seller pays freight to the named destination port. Risk passes to the buyer once goods are on board at origin. Sea and inland waterway only.

Incoterm where the seller pays freight and minimum insurance to the destination port. Risk still passes to the buyer once goods are on board at origin.

Incoterm where the seller pays carriage and insurance to a named place. Under Incoterms 2020 the insurance must be at a higher level of cover than under CIF.

Incoterm where the seller pays carriage to a named destination. Risk passes to the buyer when goods are handed to the first carrier.

Incoterm where the seller delivers goods ready for unloading at the named destination. The buyer handles import clearance and duty.

Incoterm with the maximum obligation on the seller: delivery to destination, with import clearance and duties paid by the seller.

Incoterm where the seller makes goods available at its own premises. The buyer bears almost all cost and risk from that point.

Incoterm where the seller delivers goods alongside the vessel at the named port of shipment. Sea transport only.

Incoterm where the seller delivers goods to a carrier named by the buyer. Suitable for any mode of transport.

Incoterm where the seller delivers goods on board the vessel at the named port of shipment. Risk passes to the buyer at that point. Sea and inland waterway only.

Transport document issued by an airline or its agent for air cargo. It is a receipt and contract of carriage, but not a document of title.

Document issued by the carrier for sea shipments. It acts as a receipt for goods, evidence of the contract of carriage and, in its original form, a document of title.

Declaration filed by an importer (or customs broker) with customs to clear imported goods and pay duty.

Document certifying the country where goods were manufactured. Often needed to claim reduced duty under a trade agreement.

Bill of lading issued by a freight forwarder or NVOCC to a shipper, as opposed to the carrier's master bill (MBL).

Preliminary invoice sent before shipment so the buyer can arrange payment, import licences or an L/C. It is not a demand for payment.

Buyer's formal document to a seller requesting goods, with quantity, price and terms.

Document filed with Indian customs by an exporter for goods to be exported by sea or air.

Verified total weight of a packed container, required before it can be loaded on a vessel under SOLAS rules.

Payment term where the buyer pays against shipping documents, before they are released to take delivery of the goods.

Payment is collected when goods are delivered. Rare in large B2B export because of the risk of refusal.

Payment term where the buyer receives documents after accepting a time draft, and pays on the due date.

Payment term where documents are released to the buyer only once the draft is paid. Also called D/P at sight.

Bank undertaking to pay the seller when it presents documents that strictly comply with the credit terms.

Bank wire transfer, the most common payment method in international trade, used as advance or balance payment.

Licensed agent who handles customs clearance formalities for exporters and importers. Now also called a customs broker.

Refund of customs and central excise duty paid on inputs used in goods that are exported.

Indian government body that frames and administers the Foreign Trade Policy and issues the IEC.

Indian scheme allowing import of capital goods at reduced or zero customs duty against an export obligation.

Apex body of export promotion organisations in India.

Agreement between countries to reduce or remove tariffs on goods traded between them.

Indirect tax levied in India on supply of goods and services. Exports are generally zero-rated, so exporters can claim refund of input tax.

International numbering system for classifying traded goods, with a 6-digit base used by most countries. Countries add extra digits for national tariffs.

The HS-based goods classification used in India for customs and GST.

10-digit code issued by DGFT, generally required for import or export of goods from India.

Certificate issued by an export promotion council, often required to claim benefits under export schemes.

Indian scheme that refunds embedded central, state and local duties and taxes on exported goods that are not otherwise refunded.

Unit of cargo volume (length x width x height in metres). Used to calculate freight and to plan container space.

Facility where LCL cargo is consolidated into, or deconsolidated from, containers.

Charge by the shipping line when a container stays in the port or terminal beyond the free time.

Charge by the shipping line when an empty or loaded container is kept outside the terminal beyond the free time.

Expected date a vessel, flight or shipment will reach its destination.

Expected date a vessel, flight or shipment will leave the origin.

Shipment that fills a whole container for one shipper.

Container measure equal to one 40-foot container. One FEU equals two TEU.

Dry port inland where containers can be cleared by customs, stored and moved to or from seaports.

Shipment that does not fill a container and is consolidated with other shippers' cargo.

Smallest quantity a supplier is willing to sell in one order.

Carrier that sells ocean transport and issues its own bills of lading but does not own vessels.

Standard unit for counting containers, equal to one 20-foot container.

Charges levied by a port or terminal for handling a container between ship and yard.