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CMR
CMR (an official abbreviation of the French Convention relative au contrat de transport international de Marchandise par Route) is the Convention on the Contract for the International Carriage of Goods by Road (CMR), one of the existing UN conventions governing international transport by road.
The CMR was signed in 1956, finally entered into force in 1961, among the participants in 2008 there were 55 states, by 2019 their number had decreased to 45. These are mainly European countries, it is noteworthy that after the collapse of the USSR, its states- members have not ratified the CMR.
Invoice CMR
Based on the CMR, the International Road Transport Union (IRU) has developed a standard CMR consignment note. The CMR waybill is drawn up in three languages and at least in triplicate (1 for the sender, 1 for the recipient, 1 for the driver + waybills according to the number of transit countries). This helps ensure that the consignment note will be accepted and recognized throughout Europe. A transport document verified by customs and police must be present when transporting the goods. The document itself is not particularly detailed: a minimum of information is indicated in the CMR. If dangerous substances are transported, additional information is required as described in ADR.
The waybill is filled in by the sender. It should only be filled in with a ballpoint pen, typewriter or computer. The driver using the load must be familiar with the load and the waybill to be able to inform the recipient of the importance of the various marks on the document.
Electronic consignment note eCMR
From May 27, 2008, according to the additional protocol to the CMR convention, it is also possible to use the updated electronic consignment note - eCMR. As of February 2017, there are several different options available:
The first cross-border use of eCMR took place on January 19, 2017 between Spain and France with the support of ASTIC (Asociacion de Transporte Internacional por Carretera) and FNTR (National Federation of Transport Routes).
On 24 February 2017, the UN reaffirmed its support for eCMR.
Limitations and compensation
This Convention does not apply:
CMR invoice is not a title of title or negotiable document.
Compensation in case of loss or damage to cargo cannot exceed 8.33 units of account per kilogram of missing gross weight.
“Units of Account” are Special Drawing Rights, more commonly known as DTS. It is a currency created by the International Monetary Fund (IMF) and calculated based on the US dollar, euro, pound sterling and yen. Its price can be found in the currency converter under the XDR symbol or on the IMF website.
BILL OF LADING
A bill of lading (English Bill of Landing, B/L or BOL, French le connaissement, "receipt") is an analogue of a waybill for the carriage of goods by sea. Since many goods can currently be transported by several types of transport (multimodal transportation), the bill of lading will be relevant not only for sea vessels, such a bill of lading is called through.
History
The first mentions of receipts (bills of lading) date back to the 16th century. The captain confirmed in writing the quality and quantity of the cargo received for carriage. At the same time, a separate agreement was concluded for the lease of the vessel - charter. The bill of lading acted as a kind of attachment to the charter.
In the 17th century in English navigation, the bill of lading was an integral part of the charter.
Since the 19th century, the bill of lading began to be distinguished as a separate document, its main function is the title of title.
In order to secure the status of a security for the bill of lading, local legislative acts were worked out not only in countries that had their own fleets, but also in those that used sea transportation services.
The most significant international act was the Hague Rules, adopted in 1921.
Main functions
The bill of lading performs several functions simultaneously:
Types of bill of lading
Main points / attributes of a bill of lading
The bill of lading may contain:
QUASI-CASH
Quasi-cash (from Latin quasi, "almost", as if "and English cash,"cash") are operations that the bank equates to operations with cash. The concept of" quasi-cash "is most often introduced for certain categories bank cards, for example, for debit cards with cashback programs or for credit cards with a pre-approved limit, certain transactions are excluded from preferential ones, since the card holder may have an additional benefit from their execution.
Examples of quasi-cache operations
A specific list of operations is determined by the bank and is prescribed in an agreement with a client or in additional agreements.
Most often, quasi-cache includes:
Quasi-cash sanctions
Depending on the terms of service for operations classified as quasi-cash:
Due to the fact that transactions are equivalent to transactions with cash, special conditions may apply for credit cards:
Can quasi-cash fees be disputed?
The acquiring bank analyzes debit transactions based on MCC codes. Codes are assigned to points of sale (one point - one MCC code, this is the main activity).
You will be able to dispute the additional commission only if the seller or the owner of the outlet misled you or made a mistake when specifying the main type of their activity. If the service paid by you, in fact, did not belong to quasi-cash, it can be excluded by filing a corresponding application with the bank or the court.
But if the operation complies with the banking rules, a technical error is excluded and there was no malicious intent on the part of the merchant, you will most likely be refused. For example, if you purchased food at a hotel, then the operation will be carried out with a code corresponding to the activity of the hotel / motel (for example, 7011).
Therefore, it is better to specify the MCC code of a merchant in advance, before making a payment.
CY-CY (CONTAINER YARD)
CY-CY is a method of transportation of ISO cargo containers, in which the carrier is responsible for the container entrusted to him from the moment it is handed over at the territory of the container site (container terminal) of the port of departure and until it is unloaded at the container terminal of the port of destination.
CY is an abbreviation for English. Container Yard stands for container terminal.
Instead of the abbreviation CY / CY, CFS / CFS can be used. CFS (Container Freight Station) is a container cargo station. Unlike a container yard, it is allowed to group several cargoes into one container (suitable for consolidated container shipments).
The consignor / consignee undertakes to organize the delivery of the container to the port of loading and the collection of the container at the port of destination. From the moment the container is received until its delivery to the recipient, all responsibility, risks and direct costs associated with transportation remain with the carrier.
Other options for sea freight terms (not necessary for containers):
LIFO (LINER IN AND FREE OUT)
LIFO (English Liner In and Free Out, "entry to the line + exit free") is one of the options for describing sea freight (cargo transportation), in which the payment for the carrier's services will include loading and unloading operations at the port of departure (OTHC) , and unloading at the destination port (DTHC fee) will be paid by the client or the receiving party separately.
LIFO terms can be correlated with CIF terms (Cost, Insurance and Freight, cost, insurance and carriage) from the set of international Incoterms rules.
The correct distribution of responsibility for paying the relevant fees is important when organizing international transport by sea. The fact is that these conditions will determine who will deal with the registration of imports or exports.
Other possible options for the designation of the terms of sea freight:
FIFO (FREE IN AND FREE OUT)
FIFO (English Free In and Free Out, “free entrance + free exit”) is a variant of the terms of sea freight, in which the customer pays for transportation services separately, and separately for loading and unloading operations in the port of departure (OTHC fee) and in the port destination (DTHC collection). Accordingly, the charterer is responsible for the cargo only at the stage of transportation. Loading and unloading outside his area of responsibility.
The closest to FIFO terms of delivery FOB from the set of rules Incoterms, if, under the contract, the unloading is assigned to the buyer.
In the case of international carriage, the terms of freight may delimit the responsibilities of customers and the contractor, including for import / export operations.
Alternative conditions for sea transportation include the following:
COC (CARRIER OWNED CONTAINER)
COC container (English Carrier Owned Container, "Container owned by the carrier") - a shipping container that belongs to the carrier company (charterer).
An alternative to COC containers is SOC, they are fully owned by the consignee, return to the carrier is optional.
In what situations is the use of COC containers beneficial
In almost all situations, COC containers are the most convenient to use and affordable, since their complete purchase is not required. The recipient of the cargo only pays for the rental and return delivery of the container to the nearest terminal / warehouse of the carrier.
Nevertheless, there are situations when return delivery can cause problems (it is too expensive, there is no necessary transport, etc.) or long-term storage of containers at the place of unloading is required (all this time, the recipient of the cargo will have to pay for the rental of the container). But this is rather an exception to the rule.
The basic rule for the beneficial use of COC - both at the point of departure and at the point of receipt, there must be terminals of the carrier, which is the actual owner of the container.
What is included in the rental price of COC containers
The basic payment (standard term) of the lease includes the planned use of the container (Free-Time). During this period, all planned operations must be completed: customs clearance, processing at the port of unloading, unloading and return of the container to the owner's warehouse.
Fines may apply as an additional payment:
Importation across the border of the Russian Federation of reusable containers subject to return to the sender excludes any additional duties or the need to provide special declarations. It is enough to draw up documents on re-export (obligation to re-export).
SOC (SHIPPER OWNED CONTAINER)
SOC container (English Shipper Owned Container, "Container in the property of the sender") - a shipping container that belongs to the client on the basis of property rights.
The most financially profitable format of ownership is rent (COC), it is cheaper, but requires the mandatory return of packaging.
When will the purchase of a container (SOC) be useful?
The main problem with leased containers is the procedure for returning them. It is necessary to return the shipping container to the terminal or to the warehouse of the shipping company (depending on the agreement). This means that you need to take upon yourself the payment of all transport costs for the delivery of the container to the nearest terminal.
In fact, this is tantamount to one more transportation from the point of unloading. Terminals are located mainly in large commercial cities. Therefore, return services from remote regions can sometimes exceed the cost of packaging. Especially when you consider the cost of renting loading equipment necessary to work with large containers, and special trawls / other machines suitable for transporting ISO containers.
The carrier company may refuse to rent a container if it is unable to return its container after delivery.
When buying a container, the customer, in turn, can receive reduced delivery rates (since there is no need to pay for the rental of the container), and he can sell his container at the place of unloading to other individuals or legal entities.
GRI (GENERAL RATE INCREASE)
The GRI (General Rate Increase) is a surcharge that any sea carrier can apply to the standard freight rate in order to adjust the cost of transportation in accordance with current supply and demand in the market. In other words, it is a kind of correction factor.
The GRI surcharge can be applied, for example, during a busy season or when there is a significant increase in peak load.
Who is responsible for installing the GRI
Under current regulations (United States of America CFR, p. 340, 1992), carriers are free to set an increase in the overall freight rate based on common sense and current market conditions (based on supply and demand analysis).
The carrier company must announce a rate increase no later than 30 days before the change itself (the application is submitted to the US Federal Maritime Commission). Therefore, many market participants engaged in sea transportation announce a new GRI coefficient on the first day of a certain month, so that the changes will take effect from the first day of the next month.
What GRI is used for
Primarily for the regulation of the freight market. The announcement of new GRI rates is often preceded by a fair amount of pre-bidding. If freight forwarders don't get it right with the GRI, it will have a huge impact on their profitability. Many large freight forwarders can negotiate with significant corporate clients, as the rate change will affect the cost of the transported products.
When the new GRI comes into force, the surcharge applies to all cargo that has not yet been loaded on board the vessel (including those booked for carriage).
How long does a GRI last
Although carriers have to announce the new GRI 30 days in advance, they can cut rates at any time. As a result, freight rates tend to decline from week to week for a given month and then rise again the next month when the new GRI takes effect.
In other cases, the GRI may remain in effect for a month, so it is not always possible to predict how real rates will change.
The only prerequisite for GRI is that the carrier cannot set a new price higher than it announced a month ago.
GRI Application Example
Operator's standard rate for July: $ 1,000 for a 40-foot container.
On July 1, the carrier announces that from August 1 GRI will be $ 500 for a 40-foot container.
On August 1, the new rate will be: $ 1,500 per container ($ 1,000 + $ 500 per GRI).
FORWARDER
A FORWARDER (English freight forwarder, forwarder, or forwarding agent) is a legal entity or individual, often an intermediary, who is responsible for the implementation or organization of the process of transportation of a particular cargo (goods, mail, commercial items, etc.) in accordance with with the terms of the contract.
The forwarder acts as a kind of expert who can be entrusted with complex transportation tasks, when the goods are oversized, very expensive / valuable, a change in the mode of transport is required during transportation, accompanying documents need to be drawn up when crossing the border, etc. The forwarder can solve all these issues independently or with the involvement of contractors / partners. He can promptly correct the route, change the carrier, organize escort, etc. It is not necessary for him to own his own staff of drivers or a fleet of trucks.
Freight forwarders who specialize in international transport and customs clearance are customs brokers.
History
Despite the fact that transport and expeditionary activities have existed since antiquity (for example, navigation and the system of ports in Phenicia and ancient Rome), they emerged as an independent branch of the economy around the 10th century AD. Some merchants specialized mainly in the delivery of goods that did not actually belong to them.
In the 16th-18th centuries, representative offices of forwarding companies began to open at major European ports. They consolidated the cargo, optimized the route of its transportation and even offered insurance services.
The Berlin Conference and the First Congress of Freight Forwarders in Leipzig took place in the 1880s. They have made a significant contribution to the formation of the foundations of the modern world trade system.
In Russia, the separation of forwarding into a separate industry is traditionally attributed to the beginning of the 20th century (in the post-revolutionary period). Until the 1950s, forwarding was mainly carried out by special departments at unitary enterprises.
Since 1962, the largest freight forwarding company, Zheldorexpedition, has been operating .
1979 - a standard freight forwarding agreement was developed in the USSR.
1996 - Chapter 41 (“Transport expedition”) was introduced in the Civil Code.
At the moment, Russia is still one of the countries with high transport and logistics costs.
Legal regulation of activities
Expeditionary activities are regulated by:
EDIFACT
EDIFACT (from the English EDIFACT, an abbreviation of Electronic Data Interchange for Administration, Commerce and Transport. "Electronic data interchange for administration, trade and transport") is a system of standards developed under the auspices of the UN, designed for the technical implementation of electronic exchange procedures data. These industry standards included in the EDIFACT system include, for example: IATA (applicable for air travel), SWIFT (used for banking), UIC 912 (used for rail transportation), EANCOM (used for trade), etc.
At the same time, EDIFACT is one of several options for EDI standards with an interstate scale of application.
History
The idea of using electronic document management is not new. However, electronic document flow does not exclude the use of paper carriers and other technological procedures by state and regulatory authorities, which are necessary for the processing of these documents. In this regard, there is a need not only for duplicate workflow, but for the implementation of a more comprehensive approach - according to the principle of "one window", when data is transmitted only once (no matter in what form, in electronic form or on a physical medium).
Like many other early information technologies, EDI was inspired by developments in military logistics. The complexity of air travel in Berlin in 1948 required the development of concepts and methods for exchanging data at rates in excess of 300 baud for teletype modem (at that time, it was a huge amount of information). These initial concepts later formed the first TDCC (Transport Data Coordinating Committee) standards in the United States. Among the first integrated systems to use EDI were Freight Control Systems. One such real-time system was the EDP Scheme for Freight Transport at London Heathrow Airport (LACES, in 1971). The DTI direct data entry method allowed forwarders to enter information directly into the customs processing system, reducing clearance times.
In the 1980s, the growth of maritime traffic and customs problems similar to those at Heathrow led to wider adoption of DTI systems in individual ports or even groups of ports.
In 1987, following the convergence of the United Nations and US (ANSI) syntax proposals, the UN / EDIFACT rules were approved by the International Organization for Standardization as the ISO 9735 standard.
Analogue of ISO 9735 - GOST 6.20.2-91.
What is regulated by the EDIFACT standard
The standard is updated approximately once every six months, each new version of the standard is assigned a special number. When sending any electronic document / message, the number of the standard according to which it was formed must be indicated.
Benefits of EDIFACT
Disadvantages of EDIFACT
Nevertheless, EDIFACT is currently actively used in many developed countries, as one of the few standards that have received international recognition.
CHARTER
A CHARTER (English charter party, sometimes charterparty) is an agreement between a ship owner and a charterer (vessel hirer) for rental, transportation of passengers or cargo, or for rent for entertainment, research, and other purposes.
The charter agreement assumes that the rights and obligations of the ship owner and the charterer, as well as options for resolving any subsequent disputes between them, will be clearly and unambiguously set out on paper.
The name “charterparty” is an English translation from the French Charte Partie, or “torn / torn paper”, that is, a document written in two copies, while each side retains its own half.
Types of charters
There are three main types of charters most commonly used:
Legal regulation
Freight transportation in Russia, like transport lease agreements, is governed by the provisions of the Civil Code and industry documents such as the Merchant Shipping Code or the Air Code (for aircraft).
According to the established practice in the Russian Federation, during the use of the vessel, the charterer is considered the owner of the vessel (as a person operating the vehicle on his own behalf).
On the international market, charters are monitored by a special organization - the Mediterranean Yacht Brokers Association (MYBA).
Key provisions of the contract / charter
Traditionally, constant conditions (not changing from deal to deal) are placed in part "B", and variable - in part "A" of the contract.
Bunker clause
The bunkering clause states that the charterer undertakes to accept and pay for all fuel and lubricants (POL) in the bunkers of the vessel (bunkering) at the port of delivery and vice versa, (owners) must pay for all fuel oil in the bunkers of the vessel at the port of re-delivery at the current price. When re-delivering, it is customary to agree on a certain minimum and maximum amount of fuels and lubricants in the bunkers.
Delivery clause
In accordance with this clause, the owner of the vessel clearly writes that the vessel will be seaworthy in all respects, in other words, the vessel will be suitable for travel to the country for which it is leased.
Ice clause
An ice clause is included in a bill of lading or charter when a ship is bound for a port or ports that may be closed to navigation on ice upon the arrival of the ship or after the arrival of the ship. It gives the ship owner the right to immediately terminate the contract.
Lighter clause
Charter agreements include a clause specifying any safe port within a certain range as the port of discharge, for example in the Le Havre / Hamburg area.
Negligence clause
A negligence clause generally excludes the liability of the shipowner or carrier for loss or damage arising from the act, default or negligence of the master, seafarer, pilot or carrier's employees when navigating or maneuvering the ship that could not arise with due diligence.
CONSIGNMENT NOTE (CN)
The consignment note (CN) is an outdated form of the document, which served as the basis for accounting for the movement of inventory items (MII) and payments for their transportation by road in accordance with the "General Rules of Transportation". Currently, the CN has been replaced to another universal document - a bill of lading.
The waybill is the main shipping document confirming the conclusion of the contract for the carriage of goods, in accordance with the current edition of the "Rules for the carriage of goods", approved by Government Decree.
Is it possible to use CN at the present time
Many companies used consignment notes for accounting and for conducting / processing warehouse operations at the same time. The fact is that the TTN has two sections at once:
However, the legal side of the issue has other nuances.
Correct documentation of cargo transportation
Officially, the status of consignment notes is in limbo, since the main document referring to them has already lost its legal force.
The law that regulates accounting is some Federal Law. It establishes only one form of the primary document confirming the registration of commercial cargo transportation - the bill of lading. The Government Decree (approving the "Rules for the carriage of goods by road") also operates with CN.
If only TN is required to work with cargo, then what to do with the list of inventory items that are transferred to the carrier, because in the TN form there are no corresponding fields or sections for this?
To formalize transactions with goods, and not with cargo, including fixing the transfer or reception of specific material values, TORG-12 should be used (a unified form established by Goskomstat decree).
It is TORG-12 that is responsible for converting goods / values into cargo (specific goods and their quantity are converted into packages and weight) or vice versa.
When registering TORG-12, you must indicate the number of the consignment note, and in the consignment note, in paragraph 4 ("Accompanying documents"), you must indicate the number and date of TORG-12. So both documents will be inextricably linked, and their bundle completely replaces the consignment note.
TIR CARNET
TIR-CARNET (English Carnet TIR, TIR Carnet) is a document that simplifies the customs transit procedures for goods transported by road (including containers), provided that the body or container is sealed and marked in a special way. There are special requirements for carriers - the right to use books can only be obtained by those who have passed the admission procedure (company accreditation, certification of vehicles, payment of fees to ASMAP, etc. are required).
Historical background
TIR (from the French. Transports International Routiers. "International road transport", TIR) is a system of international road transport, developed in the framework of the Customs Convention by the UN European Commission in 1959.
The first preconditions for the introduction of a universal transit system between European countries began to take shape most actively in the post-war period. Already in 1949, a number of countries had their own agreements on expedited transit.
The success of these countries has stimulated the development of a single International TIR Convention. The first version of the document was submitted in 1959.The document came into force only in 1960.
In 1975, the Convention was revised and supplemented, the new version entered into force in 1978.
This document was at that time and still remains practically the only international agreement that regulates international transit.
Another major update to the TIR Convention took place in 1997 (changes came into force in 1999). The second set of amendments, based on the recommendations of the WP.30 group of experts that updated the document, was adopted in 2002.
Work on TIR does not stop to this day.
At the moment, the Convention has been adopted and used in more than 70 countries. This includes not only the countries of the European Union, but also representatives of the Near and Middle East, North Africa.
More than 33 thousand companies are endowed with the right to transport in the TIR system (we are talking about 1.5 million transportations per year).
In 2003, the UNECE launched a new project eTIR, which implies the use of a single electronic system for the exchange of data (ITDB) between customs authorities, which further simplifies the procedures for the clearance and control of international transit.
Carnet TIR
Only one organization has the right to centrally issue and distribute TIR Carnets - the International Road Transport Union (IRU, The International Road Transport Union).
The TIR Carnet is an international guarantee for the goods transported on it.
The document can contain from 4 to 20 sheets (divisible by two), depending on how many borders the transit cargo will cross:
One booklet is issued for one vehicle (it is allowed to use couplings or load several containers at the same time).
To go through the expedited customs control procedure, the carrier must present the Carnet TIR. At the beginning of the national customs control, the customs representative tears off the corresponding sheet (white). After the completion of the control procedure (when leaving the customs area of the country of location), the second sheet (already green) is torn off. And so at every customs office.
There can be no more than three customs offices of the country of destination in the TIR Carnet (regardless of how many countries you plan to transport your cargo through).
Carnet TIR application
Joined the Convention in 1982. Until recently, it was possible to carry cargo across the borders only through certain customs points, the list of which was determined by Order of the Federal Customs Service No. 2568 (currently canceled).
The Federal Customs Service has ruled that TIR Carnets are not sufficient security for transit traffic, and therefore are not exempted from paying the necessary fees. To go through the customs, you will need to provide:
LOAD MESSAGE (LDM)
Flight load telegram (English Load Message or LDM) is one of the elements of flight documentation for air transportation, it is a special message generated manually or automatically based on a summary loading list (the main document for air transportation of goods and passengers), which sent by teletypewriter to all airports and involved services according to the route of the vehicle.
That is, in fact, this is an electronic version of the Loadsheet, which can be transmitted over communication channels faster than a physical document.
The summary sheet contains the most complete information about the payload of the aircraft:
What the flight loading telegram will look like
The Flight Loading Telegram (LDM) is sent immediately after the ship has departed. With manual registration, data is transferred to it only from the shaded fields of the loading sheet (summary sheet / Loadsheet).
The title is LDM.
The second line must contain the following data:
The third line always starts with a hyphen:
If there is no cargo or mail for transportation, NIL should be indicated instead.
FCA (FREE CARRIER)
FCA (Free CArrier, Russian "free carrier" or "free carrier") is one of the options for delivery terms indicated in the international rules of Incoterms, which assumes that the seller's responsibility for the goods passes to the buyer at the time of transfer of the goods to the carrier company in agreed place. In this case, the seller undertakes customs clearance during the export procedure.
Application
These are one of the most universal rules of transportation that are not tied to the mode of transport (there is no explicit indication of the ship's board, port, etc.). Therefore, this basis is used in about 40% of all international contracts.
The parties can choose any place, time and carrier. Hence the name of the term "free or free carrier". Moreover, in one part of the way (to the place of transfer of the goods), the seller can deliver the goods himself or involve third parties, and at the place of acceptance and transfer, the goods can be picked up by the buyer, his representative or a third party (carrier).
FCA is also suitable for organizing the supply of goods in ISO containers.
There are no restrictions on the type of transport. It can be road, rail, air or mixed transport.
This basis will be convenient, for example, for cases when the buyer collects several cargoes from different suppliers for their further centralized transportation (to ensure maximum transport load).
FCA in different versions of Incoterms
The term "free carrier" was first introduced by the rules of Incoterms 1980. Then it was designated as FRC (FRee Carrier). The abbreviation was changed to FCA already in the next version of the rules - Incoterms 1990. In the same version, the FCA basis was announced as a replacement for the obsolete FOT, FOR and FOA.
In 2000, when using the FCA basis, sellers were obliged to load the goods onto the buyer's / carrier's vehicles, and if the goods were delivered to the carrier by the seller's forces, then the receiving party is obliged to accept the goods not yet unloaded.
In the current version (2020), when using FCA, the seller may require the transfer of the bill of lading (especially for cases when the seller needs to document the shipment of the goods).
Differences from FOB and FAS
FOB (Free On Board) requires the seller to load the goods on board the vessel. That is, there is a clear indication of the transport (sea) and location (ship board).
FAS (Free Alongside Ship) assumes that the seller must deliver the goods to the port of loading. Again, there is an indication of the mode of transport and location.
In contrast to the indicated bases, FCA does not have a link to the mode of transport, and you can choose any place: port, airport, seller's premises, carrier's premises, etc.
Duties of the parties
When using the Free Carrier / FCA rules, the following obligations are imposed on the seller:
FCA benefits
This basis is suitable for any type of transportation, including multimodal and container shipping.
The buyer can choose the carrier that meets his requirements (in terms of cost, quality of services, etc.). For example, a buyer can consolidate shipments from several suppliers in one location, thereby maximizing the load on one vehicle.
The seller does not need to deal with import registration in a foreign country for him, and the buyer does not need to deal with export registration (also not in his country).
Disadvantages
Until 2020, there were problems with documentary evidence of the transfer of goods to the buyer. The seller could not refund VAT. In the current version of the Incoterms 2020 rules, this defect has been corrected, so it is better to use the 2020 version of the rules in new agreements with foreign partners.
The second point is that the risk of damage to the goods passes from the seller in another country in relation to the buyer, and this is associated with certain difficulties if loss / damage does occur.
FOB (FREE ON BOARD)
FOB (English FOB, Free On Board, "free on board", "free on board") - a variant of the terms of delivery in accordance with the international rules of Incoterms, which assumes that the responsibility for the goods and the risks of damage are transferred from the seller to the buyer at the moment when the departure is on board the ship (after loading).
Application
The FOB basis is used to describe the terms of delivery under international and domestic agreements on water transport (river or sea).
FOB cannot be used for the transportation of ISO containers, since the process of checking the goods cannot be carried out in the port (the container is sealed and closed), but it can be used for all other types of cargo (bulk, bulk and even general, when it comes to individual packaging).
FOB in different versions of Incoterms
These conditions of carriage were indicated in the very first edition of the Incoterms rules - from 1936. Later, in 1976, a special basis FOB Airport (aka FOA) was introduced, which was developed specifically for carriage by aircraft, but already in 1980. the FOA basis has been replaced by the more versatile FRC (Free Carrier, now FCA).
The classic FOB basis (for watercraft) remains valid in the current version of the rules (Incoterms 2020).
FOB terms of delivery are in many respects similar to FAS and FCA bases.
Differences between FOB and FAS
In the case of the FAS basis ("free along the side of the ship / vessel"), responsibility for the goods from the seller to the buyer passes even at the moment of unloading the goods at the berth, quay, lighter (loading on the ship is not required).
Differences between FOB and FCA
The FCA basis ("free carrier") allows you to choose any type of transport (land, air or water), is suitable for the carriage of containers, and assumes the transfer of responsibility at a designated place. These are more universal terms of delivery.
Duties of the parties
The supplier (seller) is responsible for the registration of export procedures, delivery of goods to the port of departure and loading costs.
After the cargo is on the ship, all other costs and risks are transferred to the responsibility of the buyer, for example:
The FOB basis does not determine the terms and conditions of payment (they must be indicated directly in the agreement / contract).
FOB advantages
For the seller:
For the buyer:
Disadvantages
FAS (FREE ALONGSIDE SHIP)
FAS (English FAS, Free Alongside Ship, "free along the side of the ship", "free along the side of the ship") is the delivery basis specified in the international rules of Incoterms, which establishes that responsibility for the goods passes from the seller to the buyer at the moment, when the shipment is placed at the berth indicated in the contract and is ready to be loaded onto the ship. Until then, all shipping and / or insurance costs of the goods remain with the seller.
Application
FAS terms of delivery can only be used in relation to water transport (sea or river, for domestic or international traffic).
This basis is not suitable for registration of transportation in containers, since the process of acceptance of cargo takes place actually outside the port territory (the container is closed and sealed).
Nevertheless, FAS can be used to process the transportation of liquid or bulk cargo, as well as general cargo in individual containers.
Another important condition for the transfer of responsibility is that the chartering vessel must be in the port (you cannot just bring the goods to the pier and unload them there).
FAS in different versions of Incoterms
This delivery basis was first put into effect by the 1936 version of the Incoterms rules and remains in the list of basic conditions at the moment (the latest current version of the rules is Incoterms 2020).
The obligation of the seller to clear the export has been defined in the regulations since 2000.
Differences between FAS and FOB
The closest in terms of meaning can be called the terms FOB ("Free on Board"). This basis, unlike FAS, assumes the transfer of responsibility and risks only after the goods are loaded onto the ship. From this moment on, all further costs and risks are on the buyer.
When using the FAS terms, the seller only needs to arrange delivery of the goods only to the pier, pier or lighter.
Duties of the parties
Since sea transport often involves international trade, in the case of FAS, the export clearance procedure in the country of departure remains the responsibility of the seller. The buyer pays for loading at the port and all subsequent costs, including:
In some cases, the supply contract may even provide for a scheme when a response from the buyer is not required (for example, after the expiration of the agreed period, the delivery conditions will be considered fulfilled).
FAS advantages
This basis is the most profitable for the seller, since the latter assumes only a smaller part of the costs and is not responsible for the safety of the goods for most of the journey.
The buyer receives full transparency and control over the movement of the goods, since after delivery to the port of departure, the goods are transferred to his area of responsibility.
For international transportation, the receiving party, which is traditionally a resident of the country of destination, is easier to complete all the necessary documents and settle legal issues in case of any complications. In addition, in the bill of lading (or in other accompanying documents), the sending party indicates the buyer or his agent (forwarder).
Disadvantages
- CMR
- Bill of lading
- Quasi-cash
- CY-CY (Container Yard)
- LIFO (Liner In and Free Out)
- FIFO (Free In and Free Out)
- LILO (Liner In and Liner Out)
- FILO (Free In / Liner Out)
- COC (Carrier Owned Container)
- SOC (Shipper Owned Container)
- GRI (General Rate Increase)
- Forwarder
- EDIFACT
- Charter
- Consignment note (TTN)
- TIR CARNET
- Load Message (LDM)
- FCA (Free Carrier)
- FOB (Free On Board)
- FAS (Free Alongside Ship)
CMR
CMR (an official abbreviation of the French Convention relative au contrat de transport international de Marchandise par Route) is the Convention on the Contract for the International Carriage of Goods by Road (CMR), one of the existing UN conventions governing international transport by road.
The CMR was signed in 1956, finally entered into force in 1961, among the participants in 2008 there were 55 states, by 2019 their number had decreased to 45. These are mainly European countries, it is noteworthy that after the collapse of the USSR, its states- members have not ratified the CMR.
Invoice CMR
Based on the CMR, the International Road Transport Union (IRU) has developed a standard CMR consignment note. The CMR waybill is drawn up in three languages and at least in triplicate (1 for the sender, 1 for the recipient, 1 for the driver + waybills according to the number of transit countries). This helps ensure that the consignment note will be accepted and recognized throughout Europe. A transport document verified by customs and police must be present when transporting the goods. The document itself is not particularly detailed: a minimum of information is indicated in the CMR. If dangerous substances are transported, additional information is required as described in ADR.
The waybill is filled in by the sender. It should only be filled in with a ballpoint pen, typewriter or computer. The driver using the load must be familiar with the load and the waybill to be able to inform the recipient of the importance of the various marks on the document.
Electronic consignment note eCMR
From May 27, 2008, according to the additional protocol to the CMR convention, it is also possible to use the updated electronic consignment note - eCMR. As of February 2017, there are several different options available:
- ITD (Trade Association for Danish Goods Transport by Road) has developed its solution - the eCMR consignment note.
- ECMR is also available in the French, Spanish and Dutch markets.
The first cross-border use of eCMR took place on January 19, 2017 between Spain and France with the support of ASTIC (Asociacion de Transporte Internacional por Carretera) and FNTR (National Federation of Transport Routes).
On 24 February 2017, the UN reaffirmed its support for eCMR.
Limitations and compensation
This Convention does not apply:
- for carriage carried out in accordance with international postal conventions;
- for funeral transport;
- for the transport of cars / vehicles.
CMR invoice is not a title of title or negotiable document.
Compensation in case of loss or damage to cargo cannot exceed 8.33 units of account per kilogram of missing gross weight.
“Units of Account” are Special Drawing Rights, more commonly known as DTS. It is a currency created by the International Monetary Fund (IMF) and calculated based on the US dollar, euro, pound sterling and yen. Its price can be found in the currency converter under the XDR symbol or on the IMF website.
BILL OF LADING
A bill of lading (English Bill of Landing, B/L or BOL, French le connaissement, "receipt") is an analogue of a waybill for the carriage of goods by sea. Since many goods can currently be transported by several types of transport (multimodal transportation), the bill of lading will be relevant not only for sea vessels, such a bill of lading is called through.
History
The first mentions of receipts (bills of lading) date back to the 16th century. The captain confirmed in writing the quality and quantity of the cargo received for carriage. At the same time, a separate agreement was concluded for the lease of the vessel - charter. The bill of lading acted as a kind of attachment to the charter.
In the 17th century in English navigation, the bill of lading was an integral part of the charter.
Since the 19th century, the bill of lading began to be distinguished as a separate document, its main function is the title of title.
In order to secure the status of a security for the bill of lading, local legislative acts were worked out not only in countries that had their own fleets, but also in those that used sea transportation services.
The most significant international act was the Hague Rules, adopted in 1921.
Main functions
The bill of lading performs several functions simultaneously:
- Receipt confirming receipt of the cargo, its visible condition (quality) and quantity.
- Document of title (on the basis of a bill of lading, you can sell the goods or get a pledge for it).
- Confirmation of the conclusion of the contract for the carriage of goods.
Types of bill of lading
| Name of bill of lading | Note |
|---|---|
| Clean | Bill of lading without any marks and reservations. Normally, all bills of lading must be clean, that is, indicating that the goods / cargo has no visible defects and damage. |
| Claused | A bill of lading, which contains a note by the captain that the cargo has visible defects / damage. |
| Received for shipment | A bill of lading confirming that the cargo has been accepted for loading onto the ship. |
| Onboard (shipped) | Bill of lading confirming loading on board. |
| Negotiable | A bill of lading intended to be transferred from one person to another. |
| Non-negotiable / registered | A bill of lading, which indicates a specific consignee of the goods without mentioning the possibility of transfer by order. |
| Bearer | The bearer of such a bill of lading is considered to be the owner of the cargo. |
| Charter / Freight | Individual clauses of such a bill of lading refer to clauses of the carriage / charter contract. |
| Linear | A bill of lading containing all the conditions of carriage. |
| Through | A bill of lading intended for multimodal transportation (when the cargo is transferred from one carrier to another). |
Main points / attributes of a bill of lading
The bill of lading may contain:
- The name of the carrier, as well as the name of the vessel on which the cargo will be transported (the name of the vessel is optional).
- Place of acceptance and loading of cargo.
- Destination (where the cargo will be delivered).
- Who is the recipient (the recipient can be indicated by the order of the sender, the bill of lading can be registered, that is, the recipient is indicated by address, or to the bearer, that is, the recipient is unknown in advance).
- The name of the cargo and its quantity, quality, volume / space occupied.
- Amount payable for transportation services (freight).
- When and where the bill of lading was issued, in how many copies.
- Signature of the issuer (captain or other representative of the carrier).
QUASI-CASH
Quasi-cash (from Latin quasi, "almost", as if "and English cash,"cash") are operations that the bank equates to operations with cash. The concept of" quasi-cash "is most often introduced for certain categories bank cards, for example, for debit cards with cashback programs or for credit cards with a pre-approved limit, certain transactions are excluded from preferential ones, since the card holder may have an additional benefit from their execution.
Examples of quasi-cache operations
A specific list of operations is determined by the bank and is prescribed in an agreement with a client or in additional agreements.
Most often, quasi-cache includes:
| Operation category | Possible MCC codes | Approximate reason |
|---|---|---|
| Transfers for replenishment of electronic means of payment (Yandex.Money, QIWI, etc.). | 4816, 5999, 8999, 7299, 7372 | They can be easily converted into cash or can be used to pay for goods / services. |
| Buying cryptocurrency. | 4816, 7372, 7299 | An analogue of a payment system. |
| Trading companies and trading on stock exchanges (Forex Club, ALFAFOREX and analogues), securities. | 4816, 5999, 8999, 7299, 7372, 6211 | Potential earnings on trading stocks, currencies, etc. |
| Lotteries and gambling (eg STOLOTO), bookmakers and casinos. | 5999, 8999, 7299, 7995, 7801,7802 | Possibility of easy money making on investments in gambling. |
| Financial and non-financial institutions, services for the purchase of checks, foreign currency, replenishment of trading accounts. | 6050, 6051 | Possibility to buy precious metals or exchange for money checks. |
| Money transfers. | 4829, 6051, 6538, 6537, 6536, 6534 | Possibility of cashing transfers. |
| Payment for telecommunication services, communication services, replenishment of the mobile account. | 4812, 4814, 4816, | The ability to withdraw funds from the subscriber's account, payment from the subscriber's account for other goods and services. |
| Insurance services. | 6300, 6399 | Potential increase in investment in case of insurance payments. |
| Replenishment of accounts of political, civil and religious organizations. | 8641, 8651, 8661 | The possibility of refunding membership fees and deductions. |
| Taxes, fines, court fees. | 9222, 9211, 9311, 9223 | The possibility of fraud with alimony and other payments. |
Quasi-cash sanctions
Depending on the terms of service for operations classified as quasi-cash:
- additional commissions may be charged (fixed or as a percentage of the transaction amount);
- special points, bonuses, money, etc. may not be credited in accordance with loyalty programs (including cashback programs).
Due to the fact that transactions are equivalent to transactions with cash, special conditions may apply for credit cards:
- zeroing the grace period (no deferral of the first payment);
- accrual of increased interest on the amount of the transaction, as on the amount of cash withdrawn (for example, 48% per annum, instead of 24% for non-cash transactions);
- charging additional commissions (for example, $ 10 + 3%).
Can quasi-cash fees be disputed?
The acquiring bank analyzes debit transactions based on MCC codes. Codes are assigned to points of sale (one point - one MCC code, this is the main activity).
You will be able to dispute the additional commission only if the seller or the owner of the outlet misled you or made a mistake when specifying the main type of their activity. If the service paid by you, in fact, did not belong to quasi-cash, it can be excluded by filing a corresponding application with the bank or the court.
But if the operation complies with the banking rules, a technical error is excluded and there was no malicious intent on the part of the merchant, you will most likely be refused. For example, if you purchased food at a hotel, then the operation will be carried out with a code corresponding to the activity of the hotel / motel (for example, 7011).
Therefore, it is better to specify the MCC code of a merchant in advance, before making a payment.
CY-CY (CONTAINER YARD)
CY-CY is a method of transportation of ISO cargo containers, in which the carrier is responsible for the container entrusted to him from the moment it is handed over at the territory of the container site (container terminal) of the port of departure and until it is unloaded at the container terminal of the port of destination.
CY is an abbreviation for English. Container Yard stands for container terminal.
Instead of the abbreviation CY / CY, CFS / CFS can be used. CFS (Container Freight Station) is a container cargo station. Unlike a container yard, it is allowed to group several cargoes into one container (suitable for consolidated container shipments).
The consignor / consignee undertakes to organize the delivery of the container to the port of loading and the collection of the container at the port of destination. From the moment the container is received until its delivery to the recipient, all responsibility, risks and direct costs associated with transportation remain with the carrier.
Other options for sea freight terms (not necessary for containers):
- LILO (the carrier bears the costs of loading and unloading);
- FILO (loading at the expense of the client, unloading at the port - at the expense of the carrier);
- LIFO (loading and transportation - by the carrier, unloading - at the expense of the recipient);
- FIFO (loading and unloading at the expense of the client / customer / recipient);
LIFO (LINER IN AND FREE OUT)
LIFO (English Liner In and Free Out, "entry to the line + exit free") is one of the options for describing sea freight (cargo transportation), in which the payment for the carrier's services will include loading and unloading operations at the port of departure (OTHC) , and unloading at the destination port (DTHC fee) will be paid by the client or the receiving party separately.
LIFO terms can be correlated with CIF terms (Cost, Insurance and Freight, cost, insurance and carriage) from the set of international Incoterms rules.
The correct distribution of responsibility for paying the relevant fees is important when organizing international transport by sea. The fact is that these conditions will determine who will deal with the registration of imports or exports.
Other possible options for the designation of the terms of sea freight:
- LILO (the cost of the carrier's services includes both loading and unloading);
- FILO (loading is carried out at the expense of the client, unloading is included in the payment for the carrier's services);
- FIFO (the cost of the carrier's services includes only transportation, loading and unloading - at the expense of customers);
- Cy-Cy (all operations in the receiving and giving container terminal are in the carrier's area of responsibility).
FIFO (FREE IN AND FREE OUT)
FIFO (English Free In and Free Out, “free entrance + free exit”) is a variant of the terms of sea freight, in which the customer pays for transportation services separately, and separately for loading and unloading operations in the port of departure (OTHC fee) and in the port destination (DTHC collection). Accordingly, the charterer is responsible for the cargo only at the stage of transportation. Loading and unloading outside his area of responsibility.
The closest to FIFO terms of delivery FOB from the set of rules Incoterms, if, under the contract, the unloading is assigned to the buyer.
In the case of international carriage, the terms of freight may delimit the responsibilities of customers and the contractor, including for import / export operations.
Alternative conditions for sea transportation include the following:
- LILO (loading and unloading is included in the cost of the carrier's services) ;
- FILO (loading at the expense of the client, unloading is included in the payment) ;
- LIFO (unloading at the expense of the receiving party, loading is included in the freight cost);
- Cy-Cy (the carrier organizes the whole range of operations at the receiving and sending container terminals)
COC (CARRIER OWNED CONTAINER)
COC container (English Carrier Owned Container, "Container owned by the carrier") - a shipping container that belongs to the carrier company (charterer).
An alternative to COC containers is SOC, they are fully owned by the consignee, return to the carrier is optional.
In what situations is the use of COC containers beneficial
In almost all situations, COC containers are the most convenient to use and affordable, since their complete purchase is not required. The recipient of the cargo only pays for the rental and return delivery of the container to the nearest terminal / warehouse of the carrier.
Nevertheless, there are situations when return delivery can cause problems (it is too expensive, there is no necessary transport, etc.) or long-term storage of containers at the place of unloading is required (all this time, the recipient of the cargo will have to pay for the rental of the container). But this is rather an exception to the rule.
The basic rule for the beneficial use of COC - both at the point of departure and at the point of receipt, there must be terminals of the carrier, which is the actual owner of the container.
What is included in the rental price of COC containers
The basic payment (standard term) of the lease includes the planned use of the container (Free-Time). During this period, all planned operations must be completed: customs clearance, processing at the port of unloading, unloading and return of the container to the owner's warehouse.
Fines may apply as an additional payment:
- Detention - sanctions for delaying a container outside the terminal;
- Demurrage - sanctions for delaying containers directly at the port terminal (for example, due to problems with clearance).
Importation across the border of the Russian Federation of reusable containers subject to return to the sender excludes any additional duties or the need to provide special declarations. It is enough to draw up documents on re-export (obligation to re-export).
SOC (SHIPPER OWNED CONTAINER)
SOC container (English Shipper Owned Container, "Container in the property of the sender") - a shipping container that belongs to the client on the basis of property rights.
The most financially profitable format of ownership is rent (COC), it is cheaper, but requires the mandatory return of packaging.
When will the purchase of a container (SOC) be useful?
The main problem with leased containers is the procedure for returning them. It is necessary to return the shipping container to the terminal or to the warehouse of the shipping company (depending on the agreement). This means that you need to take upon yourself the payment of all transport costs for the delivery of the container to the nearest terminal.
In fact, this is tantamount to one more transportation from the point of unloading. Terminals are located mainly in large commercial cities. Therefore, return services from remote regions can sometimes exceed the cost of packaging. Especially when you consider the cost of renting loading equipment necessary to work with large containers, and special trawls / other machines suitable for transporting ISO containers.
The carrier company may refuse to rent a container if it is unable to return its container after delivery.
When buying a container, the customer, in turn, can receive reduced delivery rates (since there is no need to pay for the rental of the container), and he can sell his container at the place of unloading to other individuals or legal entities.
GRI (GENERAL RATE INCREASE)
The GRI (General Rate Increase) is a surcharge that any sea carrier can apply to the standard freight rate in order to adjust the cost of transportation in accordance with current supply and demand in the market. In other words, it is a kind of correction factor.
The GRI surcharge can be applied, for example, during a busy season or when there is a significant increase in peak load.
Who is responsible for installing the GRI
Under current regulations (United States of America CFR, p. 340, 1992), carriers are free to set an increase in the overall freight rate based on common sense and current market conditions (based on supply and demand analysis).
The carrier company must announce a rate increase no later than 30 days before the change itself (the application is submitted to the US Federal Maritime Commission). Therefore, many market participants engaged in sea transportation announce a new GRI coefficient on the first day of a certain month, so that the changes will take effect from the first day of the next month.
What GRI is used for
Primarily for the regulation of the freight market. The announcement of new GRI rates is often preceded by a fair amount of pre-bidding. If freight forwarders don't get it right with the GRI, it will have a huge impact on their profitability. Many large freight forwarders can negotiate with significant corporate clients, as the rate change will affect the cost of the transported products.
When the new GRI comes into force, the surcharge applies to all cargo that has not yet been loaded on board the vessel (including those booked for carriage).
How long does a GRI last
Although carriers have to announce the new GRI 30 days in advance, they can cut rates at any time. As a result, freight rates tend to decline from week to week for a given month and then rise again the next month when the new GRI takes effect.
In other cases, the GRI may remain in effect for a month, so it is not always possible to predict how real rates will change.
The only prerequisite for GRI is that the carrier cannot set a new price higher than it announced a month ago.
GRI Application Example
Operator's standard rate for July: $ 1,000 for a 40-foot container.
On July 1, the carrier announces that from August 1 GRI will be $ 500 for a 40-foot container.
On August 1, the new rate will be: $ 1,500 per container ($ 1,000 + $ 500 per GRI).
FORWARDER
A FORWARDER (English freight forwarder, forwarder, or forwarding agent) is a legal entity or individual, often an intermediary, who is responsible for the implementation or organization of the process of transportation of a particular cargo (goods, mail, commercial items, etc.) in accordance with with the terms of the contract.
The forwarder acts as a kind of expert who can be entrusted with complex transportation tasks, when the goods are oversized, very expensive / valuable, a change in the mode of transport is required during transportation, accompanying documents need to be drawn up when crossing the border, etc. The forwarder can solve all these issues independently or with the involvement of contractors / partners. He can promptly correct the route, change the carrier, organize escort, etc. It is not necessary for him to own his own staff of drivers or a fleet of trucks.
Freight forwarders who specialize in international transport and customs clearance are customs brokers.
History
Despite the fact that transport and expeditionary activities have existed since antiquity (for example, navigation and the system of ports in Phenicia and ancient Rome), they emerged as an independent branch of the economy around the 10th century AD. Some merchants specialized mainly in the delivery of goods that did not actually belong to them.
In the 16th-18th centuries, representative offices of forwarding companies began to open at major European ports. They consolidated the cargo, optimized the route of its transportation and even offered insurance services.
The Berlin Conference and the First Congress of Freight Forwarders in Leipzig took place in the 1880s. They have made a significant contribution to the formation of the foundations of the modern world trade system.
In Russia, the separation of forwarding into a separate industry is traditionally attributed to the beginning of the 20th century (in the post-revolutionary period). Until the 1950s, forwarding was mainly carried out by special departments at unitary enterprises.
Since 1962, the largest freight forwarding company, Zheldorexpedition, has been operating .
1979 - a standard freight forwarding agreement was developed in the USSR.
1996 - Chapter 41 (“Transport expedition”) was introduced in the Civil Code.
At the moment, Russia is still one of the countries with high transport and logistics costs.
Legal regulation of activities
Expeditionary activities are regulated by:
- Federal Law (of 2003 with the latest amendments and additions);
- The Rules of Transport and Forwarding Activities (approved by Government Decree);
- The Civil Code of the Russian Federation.
EDIFACT
EDIFACT (from the English EDIFACT, an abbreviation of Electronic Data Interchange for Administration, Commerce and Transport. "Electronic data interchange for administration, trade and transport") is a system of standards developed under the auspices of the UN, designed for the technical implementation of electronic exchange procedures data. These industry standards included in the EDIFACT system include, for example: IATA (applicable for air travel), SWIFT (used for banking), UIC 912 (used for rail transportation), EANCOM (used for trade), etc.
At the same time, EDIFACT is one of several options for EDI standards with an interstate scale of application.
History
The idea of using electronic document management is not new. However, electronic document flow does not exclude the use of paper carriers and other technological procedures by state and regulatory authorities, which are necessary for the processing of these documents. In this regard, there is a need not only for duplicate workflow, but for the implementation of a more comprehensive approach - according to the principle of "one window", when data is transmitted only once (no matter in what form, in electronic form or on a physical medium).
Like many other early information technologies, EDI was inspired by developments in military logistics. The complexity of air travel in Berlin in 1948 required the development of concepts and methods for exchanging data at rates in excess of 300 baud for teletype modem (at that time, it was a huge amount of information). These initial concepts later formed the first TDCC (Transport Data Coordinating Committee) standards in the United States. Among the first integrated systems to use EDI were Freight Control Systems. One such real-time system was the EDP Scheme for Freight Transport at London Heathrow Airport (LACES, in 1971). The DTI direct data entry method allowed forwarders to enter information directly into the customs processing system, reducing clearance times.
In the 1980s, the growth of maritime traffic and customs problems similar to those at Heathrow led to wider adoption of DTI systems in individual ports or even groups of ports.
In 1987, following the convergence of the United Nations and US (ANSI) syntax proposals, the UN / EDIFACT rules were approved by the International Organization for Standardization as the ISO 9735 standard.
Analogue of ISO 9735 - GOST 6.20.2-91.
What is regulated by the EDIFACT standard
- A set of syntax rules for structuring data.
- Interactive exchange protocol (I-EDI).
- A standard for messages exchanged between countries and industries.
The standard is updated approximately once every six months, each new version of the standard is assigned a special number. When sending any electronic document / message, the number of the standard according to which it was formed must be indicated.
Benefits of EDIFACT
- The transition to electronic data exchange makes it possible to get rid of the use of paper media.
- The exchange of information in the system is much faster.
- Improves data security and integrity.
- The universal format allows the use of EDIFACT in all interacting structures (from legal entities to government services).
- Costs for document circulation are reduced.
- The time for many procedures is reduced when any participants in the system interact.
- Increased transparency and speed of control.
Disadvantages of EDIFACT
- The EDIFACT standard itself is free, but the software intended for technical implementation is difficult to develop, therefore it is often paid.
- The standard describes a lot of data and regulates many message formats, data types, etc. Which leads to a complex implementation at a specific site.
- The requirements of the standard are regularly changed (revised), which can lead to misinterpretation of received messages (to errors in data exchange).
- The syntax of messages (requests and responses) is too compressed by modern standards. There are no closing tags, which complicates the process of "reading" the data (transferring it to the database and distributing it to the corresponding fields).
- The set of fields for typical messages is too large (redundant for some types of exchange).
Nevertheless, EDIFACT is currently actively used in many developed countries, as one of the few standards that have received international recognition.
CHARTER
A CHARTER (English charter party, sometimes charterparty) is an agreement between a ship owner and a charterer (vessel hirer) for rental, transportation of passengers or cargo, or for rent for entertainment, research, and other purposes.
The charter agreement assumes that the rights and obligations of the ship owner and the charterer, as well as options for resolving any subsequent disputes between them, will be clearly and unambiguously set out on paper.
The name “charterparty” is an English translation from the French Charte Partie, or “torn / torn paper”, that is, a document written in two copies, while each side retains its own half.
Types of charters
There are three main types of charters most commonly used:
- by time. This group includes time charter (time charter), when the contract is concluded for a certain time;
- by the method of transfer of rights. In this group, there are two options at once: demise charter, when the charterer actually becomes the full owner of the vessel for the duration of the contract, control over the crew is also retained by him; and a bareboat charter, when only a ship is leased to a charterer, without a crew, and the charterer himself recruits a crew and is responsible for it;
- along the journey / path. This includes a voyage charter, when a vessel is leased for one or more voyages.
Legal regulation
Freight transportation in Russia, like transport lease agreements, is governed by the provisions of the Civil Code and industry documents such as the Merchant Shipping Code or the Air Code (for aircraft).
According to the established practice in the Russian Federation, during the use of the vessel, the charterer is considered the owner of the vessel (as a person operating the vehicle on his own behalf).
On the international market, charters are monitored by a special organization - the Mediterranean Yacht Brokers Association (MYBA).
Key provisions of the contract / charter
Traditionally, constant conditions (not changing from deal to deal) are placed in part "B", and variable - in part "A" of the contract.
Bunker clause
The bunkering clause states that the charterer undertakes to accept and pay for all fuel and lubricants (POL) in the bunkers of the vessel (bunkering) at the port of delivery and vice versa, (owners) must pay for all fuel oil in the bunkers of the vessel at the port of re-delivery at the current price. When re-delivering, it is customary to agree on a certain minimum and maximum amount of fuels and lubricants in the bunkers.
Delivery clause
In accordance with this clause, the owner of the vessel clearly writes that the vessel will be seaworthy in all respects, in other words, the vessel will be suitable for travel to the country for which it is leased.
Ice clause
An ice clause is included in a bill of lading or charter when a ship is bound for a port or ports that may be closed to navigation on ice upon the arrival of the ship or after the arrival of the ship. It gives the ship owner the right to immediately terminate the contract.
Lighter clause
Charter agreements include a clause specifying any safe port within a certain range as the port of discharge, for example in the Le Havre / Hamburg area.
Negligence clause
A negligence clause generally excludes the liability of the shipowner or carrier for loss or damage arising from the act, default or negligence of the master, seafarer, pilot or carrier's employees when navigating or maneuvering the ship that could not arise with due diligence.
CONSIGNMENT NOTE (CN)
The consignment note (CN) is an outdated form of the document, which served as the basis for accounting for the movement of inventory items (MII) and payments for their transportation by road in accordance with the "General Rules of Transportation". Currently, the CN has been replaced to another universal document - a bill of lading.
The waybill is the main shipping document confirming the conclusion of the contract for the carriage of goods, in accordance with the current edition of the "Rules for the carriage of goods", approved by Government Decree.
Is it possible to use CN at the present time
Many companies used consignment notes for accounting and for conducting / processing warehouse operations at the same time. The fact is that the TTN has two sections at once:
- Commodity, where specific inventory items are taken into account and described, which are accepted by the carrier;
- Transport, which is the official basis directly for the operation of the carriage of any cargo.
However, the legal side of the issue has other nuances.
Correct documentation of cargo transportation
Officially, the status of consignment notes is in limbo, since the main document referring to them has already lost its legal force.
The law that regulates accounting is some Federal Law. It establishes only one form of the primary document confirming the registration of commercial cargo transportation - the bill of lading. The Government Decree (approving the "Rules for the carriage of goods by road") also operates with CN.
If only TN is required to work with cargo, then what to do with the list of inventory items that are transferred to the carrier, because in the TN form there are no corresponding fields or sections for this?
To formalize transactions with goods, and not with cargo, including fixing the transfer or reception of specific material values, TORG-12 should be used (a unified form established by Goskomstat decree).
It is TORG-12 that is responsible for converting goods / values into cargo (specific goods and their quantity are converted into packages and weight) or vice versa.
When registering TORG-12, you must indicate the number of the consignment note, and in the consignment note, in paragraph 4 ("Accompanying documents"), you must indicate the number and date of TORG-12. So both documents will be inextricably linked, and their bundle completely replaces the consignment note.
TIR CARNET
TIR-CARNET (English Carnet TIR, TIR Carnet) is a document that simplifies the customs transit procedures for goods transported by road (including containers), provided that the body or container is sealed and marked in a special way. There are special requirements for carriers - the right to use books can only be obtained by those who have passed the admission procedure (company accreditation, certification of vehicles, payment of fees to ASMAP, etc. are required).
Historical background
TIR (from the French. Transports International Routiers. "International road transport", TIR) is a system of international road transport, developed in the framework of the Customs Convention by the UN European Commission in 1959.
The first preconditions for the introduction of a universal transit system between European countries began to take shape most actively in the post-war period. Already in 1949, a number of countries had their own agreements on expedited transit.
The success of these countries has stimulated the development of a single International TIR Convention. The first version of the document was submitted in 1959.The document came into force only in 1960.
In 1975, the Convention was revised and supplemented, the new version entered into force in 1978.
This document was at that time and still remains practically the only international agreement that regulates international transit.
Another major update to the TIR Convention took place in 1997 (changes came into force in 1999). The second set of amendments, based on the recommendations of the WP.30 group of experts that updated the document, was adopted in 2002.
Work on TIR does not stop to this day.
At the moment, the Convention has been adopted and used in more than 70 countries. This includes not only the countries of the European Union, but also representatives of the Near and Middle East, North Africa.
More than 33 thousand companies are endowed with the right to transport in the TIR system (we are talking about 1.5 million transportations per year).
In 2003, the UNECE launched a new project eTIR, which implies the use of a single electronic system for the exchange of data (ITDB) between customs authorities, which further simplifies the procedures for the clearance and control of international transit.
Carnet TIR
Only one organization has the right to centrally issue and distribute TIR Carnets - the International Road Transport Union (IRU, The International Road Transport Union).
The TIR Carnet is an international guarantee for the goods transported on it.
The document can contain from 4 to 20 sheets (divisible by two), depending on how many borders the transit cargo will cross:
- the first sheet is the cargo manifest (it always remains in the book);
- then - paired tear-off sheets (after tearing off the sheet, its spine remains);
- the last sheet is the protocol.
One booklet is issued for one vehicle (it is allowed to use couplings or load several containers at the same time).
To go through the expedited customs control procedure, the carrier must present the Carnet TIR. At the beginning of the national customs control, the customs representative tears off the corresponding sheet (white). After the completion of the control procedure (when leaving the customs area of the country of location), the second sheet (already green) is torn off. And so at every customs office.
There can be no more than three customs offices of the country of destination in the TIR Carnet (regardless of how many countries you plan to transport your cargo through).
Carnet TIR application
Joined the Convention in 1982. Until recently, it was possible to carry cargo across the borders only through certain customs points, the list of which was determined by Order of the Federal Customs Service No. 2568 (currently canceled).
The Federal Customs Service has ruled that TIR Carnets are not sufficient security for transit traffic, and therefore are not exempted from paying the necessary fees. To go through the customs, you will need to provide:
- certificate of the customs carrier;
- guarantee certificate or surety;
- customs escort.
LOAD MESSAGE (LDM)
Flight load telegram (English Load Message or LDM) is one of the elements of flight documentation for air transportation, it is a special message generated manually or automatically based on a summary loading list (the main document for air transportation of goods and passengers), which sent by teletypewriter to all airports and involved services according to the route of the vehicle.
That is, in fact, this is an electronic version of the Loadsheet, which can be transmitted over communication channels faster than a physical document.
The summary sheet contains the most complete information about the payload of the aircraft:
- data on the total load (total weight of baggage, including passengers, mail and cargo);
- separate data on special cargo;
- information about the latest changes before departure (last minute changes, whether passengers, cargo, baggage, etc. have been removed);
- destinations (final and intermediate / transit airports).
What the flight loading telegram will look like
The Flight Loading Telegram (LDM) is sent immediately after the ship has departed. With manual registration, data is transferred to it only from the shaded fields of the loading sheet (summary sheet / Loadsheet).
The title is LDM.
The second line must contain the following data:
- airline code and flight number (no more than 7 characters);
- separated by a slash - date (2 characters that correspond to the day of the month);
- aircraft number (5 characters);
- the layout of the aircraft (through the fractional line BUSINESS / ECONOMY);
- crew data - the number of pilots / flight attendants.
The third line always starts with a hyphen:
- destination airport code (according to the IATA classifier );
- passenger data (number of adults / children / children under 2 years old);
- data on passengers' hand luggage;
- information about the total load in kilograms (starts with T **);
- location data by compartments;
- information on passenger booking classes (PAX);
- non-commercial passenger information (PAD);
- passenger baggage weight in kilograms (B ***);
- mail weight (M ***);
- cargo weight (C ***);
- other additional information (SI), it is not decrypted by automated software.
If there is no cargo or mail for transportation, NIL should be indicated instead.
FCA (FREE CARRIER)
FCA (Free CArrier, Russian "free carrier" or "free carrier") is one of the options for delivery terms indicated in the international rules of Incoterms, which assumes that the seller's responsibility for the goods passes to the buyer at the time of transfer of the goods to the carrier company in agreed place. In this case, the seller undertakes customs clearance during the export procedure.
Application
These are one of the most universal rules of transportation that are not tied to the mode of transport (there is no explicit indication of the ship's board, port, etc.). Therefore, this basis is used in about 40% of all international contracts.
The parties can choose any place, time and carrier. Hence the name of the term "free or free carrier". Moreover, in one part of the way (to the place of transfer of the goods), the seller can deliver the goods himself or involve third parties, and at the place of acceptance and transfer, the goods can be picked up by the buyer, his representative or a third party (carrier).
FCA is also suitable for organizing the supply of goods in ISO containers.
There are no restrictions on the type of transport. It can be road, rail, air or mixed transport.
This basis will be convenient, for example, for cases when the buyer collects several cargoes from different suppliers for their further centralized transportation (to ensure maximum transport load).
FCA in different versions of Incoterms
The term "free carrier" was first introduced by the rules of Incoterms 1980. Then it was designated as FRC (FRee Carrier). The abbreviation was changed to FCA already in the next version of the rules - Incoterms 1990. In the same version, the FCA basis was announced as a replacement for the obsolete FOT, FOR and FOA.
In 2000, when using the FCA basis, sellers were obliged to load the goods onto the buyer's / carrier's vehicles, and if the goods were delivered to the carrier by the seller's forces, then the receiving party is obliged to accept the goods not yet unloaded.
In the current version (2020), when using FCA, the seller may require the transfer of the bill of lading (especially for cases when the seller needs to document the shipment of the goods).
Differences from FOB and FAS
FOB (Free On Board) requires the seller to load the goods on board the vessel. That is, there is a clear indication of the transport (sea) and location (ship board).
FAS (Free Alongside Ship) assumes that the seller must deliver the goods to the port of loading. Again, there is an indication of the mode of transport and location.
In contrast to the indicated bases, FCA does not have a link to the mode of transport, and you can choose any place: port, airport, seller's premises, carrier's premises, etc.
Duties of the parties
When using the Free Carrier / FCA rules, the following obligations are imposed on the seller:
- The need to perform customs clearance procedures in the country of departure (when exporting).
- If the goods are to be handed over to the buyer or carrier at the seller's premises, the seller is obliged to carry out the loading procedure on his own.
- If the place of transfer is the carrier's premises, then the seller is only obliged to deliver the goods to the specified place. Unloading in this case should be done by the receiving party.
- Until the transfer, all costs (transportation, customs clearance, etc.) are on the seller.
FCA benefits
This basis is suitable for any type of transportation, including multimodal and container shipping.
The buyer can choose the carrier that meets his requirements (in terms of cost, quality of services, etc.). For example, a buyer can consolidate shipments from several suppliers in one location, thereby maximizing the load on one vehicle.
The seller does not need to deal with import registration in a foreign country for him, and the buyer does not need to deal with export registration (also not in his country).
Disadvantages
Until 2020, there were problems with documentary evidence of the transfer of goods to the buyer. The seller could not refund VAT. In the current version of the Incoterms 2020 rules, this defect has been corrected, so it is better to use the 2020 version of the rules in new agreements with foreign partners.
The second point is that the risk of damage to the goods passes from the seller in another country in relation to the buyer, and this is associated with certain difficulties if loss / damage does occur.
FOB (FREE ON BOARD)
FOB (English FOB, Free On Board, "free on board", "free on board") - a variant of the terms of delivery in accordance with the international rules of Incoterms, which assumes that the responsibility for the goods and the risks of damage are transferred from the seller to the buyer at the moment when the departure is on board the ship (after loading).
Application
The FOB basis is used to describe the terms of delivery under international and domestic agreements on water transport (river or sea).
FOB cannot be used for the transportation of ISO containers, since the process of checking the goods cannot be carried out in the port (the container is sealed and closed), but it can be used for all other types of cargo (bulk, bulk and even general, when it comes to individual packaging).
FOB in different versions of Incoterms
These conditions of carriage were indicated in the very first edition of the Incoterms rules - from 1936. Later, in 1976, a special basis FOB Airport (aka FOA) was introduced, which was developed specifically for carriage by aircraft, but already in 1980. the FOA basis has been replaced by the more versatile FRC (Free Carrier, now FCA).
The classic FOB basis (for watercraft) remains valid in the current version of the rules (Incoterms 2020).
FOB terms of delivery are in many respects similar to FAS and FCA bases.
Differences between FOB and FAS
In the case of the FAS basis ("free along the side of the ship / vessel"), responsibility for the goods from the seller to the buyer passes even at the moment of unloading the goods at the berth, quay, lighter (loading on the ship is not required).
Differences between FOB and FCA
The FCA basis ("free carrier") allows you to choose any type of transport (land, air or water), is suitable for the carriage of containers, and assumes the transfer of responsibility at a designated place. These are more universal terms of delivery.
Duties of the parties
The supplier (seller) is responsible for the registration of export procedures, delivery of goods to the port of departure and loading costs.
After the cargo is on the ship, all other costs and risks are transferred to the responsibility of the buyer, for example:
- services of transportation by ship (freight);
- payment of insurance fees;
- unloading at the port of destination, as well as temporary storage (if applicable);
- delivery to the destination by other means of transport;
- duties and costs for import clearance (customs clearance);
- acquisition of licenses and expenses for other permitting documents.
The FOB basis does not determine the terms and conditions of payment (they must be indicated directly in the agreement / contract).
FOB advantages
For the seller:
- No need to charter a ship. The main part of the journey, the goods are under the control of the buyer, so the seller does not care about all the problems associated with transportation.
- You do not need to have a representative office in the country of destination, etc. All further operations for customs clearance, import clearance and legal issues are on the receiving side.
- It is easier to solve problems with shipment, since in the bill of lading (or in other accompanying documents) the seller is indicated as the sender.
For the buyer:
- Already from the moment of loading on the ship, the receiving party controls its goods.
- The buyer can choose any carriers that suit him according to the terms and conditions of delivery, as well as cost.
Disadvantages
- For the seller, there is a potential for overlays with the observance of the loading time (the vessel may be delayed, the buyer may not find a charterer, etc.).
- The buyer needs to organize a complex supply chain (this is quite difficult without experience).
FAS (FREE ALONGSIDE SHIP)
FAS (English FAS, Free Alongside Ship, "free along the side of the ship", "free along the side of the ship") is the delivery basis specified in the international rules of Incoterms, which establishes that responsibility for the goods passes from the seller to the buyer at the moment, when the shipment is placed at the berth indicated in the contract and is ready to be loaded onto the ship. Until then, all shipping and / or insurance costs of the goods remain with the seller.
Application
FAS terms of delivery can only be used in relation to water transport (sea or river, for domestic or international traffic).
This basis is not suitable for registration of transportation in containers, since the process of acceptance of cargo takes place actually outside the port territory (the container is closed and sealed).
Nevertheless, FAS can be used to process the transportation of liquid or bulk cargo, as well as general cargo in individual containers.
Another important condition for the transfer of responsibility is that the chartering vessel must be in the port (you cannot just bring the goods to the pier and unload them there).
FAS in different versions of Incoterms
This delivery basis was first put into effect by the 1936 version of the Incoterms rules and remains in the list of basic conditions at the moment (the latest current version of the rules is Incoterms 2020).
The obligation of the seller to clear the export has been defined in the regulations since 2000.
Differences between FAS and FOB
The closest in terms of meaning can be called the terms FOB ("Free on Board"). This basis, unlike FAS, assumes the transfer of responsibility and risks only after the goods are loaded onto the ship. From this moment on, all further costs and risks are on the buyer.
When using the FAS terms, the seller only needs to arrange delivery of the goods only to the pier, pier or lighter.
Duties of the parties
Since sea transport often involves international trade, in the case of FAS, the export clearance procedure in the country of departure remains the responsibility of the seller. The buyer pays for loading at the port and all subsequent costs, including:
- insurance premiums at the stage of transportation by sea and beyond;
- duties and other expenses for import clearance;
- freight of the vessel;
- unloading and storage services at the port of destination;
- further transportation from the port to the destination;
- obtaining and paying for the required licenses or other permissive documents.
In some cases, the supply contract may even provide for a scheme when a response from the buyer is not required (for example, after the expiration of the agreed period, the delivery conditions will be considered fulfilled).
FAS advantages
This basis is the most profitable for the seller, since the latter assumes only a smaller part of the costs and is not responsible for the safety of the goods for most of the journey.
The buyer receives full transparency and control over the movement of the goods, since after delivery to the port of departure, the goods are transferred to his area of responsibility.
For international transportation, the receiving party, which is traditionally a resident of the country of destination, is easier to complete all the necessary documents and settle legal issues in case of any complications. In addition, in the bill of lading (or in other accompanying documents), the sending party indicates the buyer or his agent (forwarder).
Disadvantages
- Delays in sea transport are not uncommon. Therefore, there are always risks of additional costs due to waiting at the port of delivery. In this case, the giving party suffers (assumes the costs for downtime).
- FAS cannot be used for container shipping.
- Organization of virtually the entire supply chain on the buyer (not everyone can cope with this task, especially in the absence of experience).
