International shipping Terms

Bonded Warehouse: A bonded warehouse in which goods subject to excise taxes

or customs duties are temporarily stored without the taxes or duties being
assessed. A bond or security is given for the payment of all taxes and duties that
may eventually become due.

A Certificate of Origin form: A document, required by foreign governments,

declaring that goods in a particular international shipment are of a certain origin.
Even though the commercial invoice usually includes a statement of origin, some
countries require that a separate certificate be completed. Customs offices will
use the Certificate of Origin form to determine whether or not a preferential duty
rate applies on the products being imported and whether a shipment may be
legally imported during a specific quota period.

A Certificate of Origin is a signed statement as to the country of origin of the

exported products for a particular shipment. The country of origin is NOT the
country from where the product is shipped. The country of origin is the country
where the product was manufactured or last underwent a substantial change or
modification, for WTO members, goods can be considered originating if there is a
shift of at least two chapters in the harmonized code.

For example, the country of origin for 100% cotton, knit shirts that are
manufactured in China and then shipped to the U.S. and have a logo or slogan
placed on them, and are then exported to Canada, would be China. However, if
the cotton knit fabric was manufactured in China and then shipped to the U.S.
and the fabric was transformed into shirts and are then exported to Canada, the
country of origin would be considered the U.S.

Customs Broker: A person or firm licensed by an importer's government and

engaged in entering and clearing goods through customs. The responsibilities of a
broker include preparing the entry form and filing it; advising the importer on
duties to be paid; advancing duties and other costs; and arranging for delivery to
the importer
LCL: (Less than Container Load) A term used in shipping when goods do not
completely occupy an entire container. When many shippers' goods occupy a
single container, each shipper's shipment is considered to be LCL.

FCL (Full Container Load) A term used in shipping when goods occupy a whole
container.

Importer of Record: The U.S. Customs Service defines the importer of record as
the owner or purchaser of the goods; or, when designated by the owner,
purchaser, or consignee, a licensed Customs broker

Inbond shipment: Import shipments moving into or through the United States or
Canada which have not cleared Customs at the border and therefore travel under
a Customs (Treasury) bond, and are identified as in-bond shipments.

PORT OF DISCHARGE: Port where vessel is off loaded and cargo discharged

Supply Chain: The network of retailers, distributors, transporters, storage

facilities and suppliers that participate in the sale, delivery and production of a
particular product.

NAFTA: (North American Free Trade Agreement) which entered into force in
January 1994, is a free trade agreement comprising Canada, the United States and
Mexico. NAFTA exceeds 360 million consumers and a combined output of $6
trillion --approximately 20 percent larger than the European Community. NAFTA's
consumer population is slightly smaller than the European Economic Area which
has over 380 million consumers.

The Agreement:
Progressively eliminates almost all U.S.-Mexico tariffs over a 10-year period, with
a small number of tariffs for trade-sensitive industries phased out over a 15-year
period. Mexico-Canada tariffs are also phased out over a 10-year period. Tariff
reduction schedules between the United States and Canada negotiated in the
Canadian Free Trade Agreement are retained. Eliminates other barriers to trade
such as import licensing requirements and Customs user fees. Establishes the
principle of national treatment, for ensuring that NAFTA-origin products trade
between NAFTA countries will receive treatment equal to similar domestic
products. Guarantees service providers of the three countries equal treatment in
the NAFTA area, including the right to invest and the right to sell services across
borders. Establishes five basic principles to protect foreign investors and their
investment into the free trade area: (a) nondiscriminatory treatment, (b) freedom
from performance requirements, (c) free transference of funds related to an
investment, (d) expropriation only in conformity with international law, and (e)
the right to seek international arbitration for a violation of the agreement's
protections

Temporary import bond: States or Canada without payment of duty, by posting a

bond to guarantee that they will be exported. The amount of the bond is usually A
temporary import bond or TIB ("Temporary Importation under Bond") is required
when goods are brought into the United double the estimated duties. Goods
imported under a temporary import bond can remain in either country without
the payment of duty for up to a year. These goods must be brought back to the
country of export before the expiration of the bond period to avoid the
assessment of liquidated damages in the amount of the bond. If the goods are not
exported, the bond is forfeited, usually in the amount of twice the value of the
customs duties that would have been payable on the products. The one year
period for exportation can be extended upon application to the port director

Continuous bond: Guarantee or performance bond that 'rolls over' every year to
remain in force over the life of a contract or indefinitely (such as a customs bond).

Single entry bond: Guarantee posted by an importer of record with the customs
(usually three times the value of the product) to ensure presentation of the
imported item for examination, export, or disposal.

Value of customs purposes only: The U.S. Customs Service defines "value for
Customs purposes only" as the value submitted on the entry documentation by
the importer which may or may not reflect information from the manufacturer
but in no way reflects Customs appraisement of the merchandise