Chap07

5,934 views

Published on

Published in: Business
1 Comment
6 Likes
Statistics
Notes
No Downloads
Views
Total views
5,934
On SlideShare
0
From Embeds
0
Number of Embeds
9
Actions
Shares
0
Downloads
307
Comments
1
Likes
6
Embeds 0
No embeds

No notes for slide

Chap07

  1. 1. CHAPTER VII INTERNATIONAL TRANSPORTATION <ul><li>Types of International Transportation </li></ul><ul><li>Types of International Cargo </li></ul><ul><li>Ocean Freight Costs </li></ul><ul><li>Ocean Bill of Lading </li></ul><ul><li>Non-Negotiable Sea Waybill </li></ul><ul><li>Multimodal Transport Document </li></ul><ul><li>Letter of Credit and Ocean Bill of Lading </li></ul><ul><li>Parties Responsible for Shipping Arrangements </li></ul><ul><li>Arrival Notice </li></ul>
  2. 2. Truck and Rail <ul><li>Primary carriers among countries in the same continent such as the USA, Mexico, & Canada. EU countries </li></ul><ul><li>Containerized piggyback service on rail </li></ul><ul><li>Combined transportation of ocean and inland to domestic final destination </li></ul>
  3. 3. Air Transportation <ul><li>Most expensive but fastest mode of transportation </li></ul><ul><li>High valued goods </li></ul><ul><li>Fragile goods </li></ul><ul><li>Perishable goods </li></ul><ul><li>Shorter transit time: Speedy delivery </li></ul><ul><li>Less burden on inventory: Just-in-time delivery </li></ul>
  4. 4. Air Transportation <ul><li>Air freight </li></ul><ul><ul><li>By weight or volume </li></ul></ul><ul><ul><li>Steep progressive rate structure </li></ul></ul><ul><ul><li>Depending on commodities </li></ul></ul>
  5. 5. Air Transportation <ul><li>Air freight carriers </li></ul><ul><ul><li>Airlines: Operate own air planes </li></ul></ul><ul><ul><li>Air freight consolidators </li></ul></ul><ul><ul><ul><li>Air freight wholesalers for less than container load (LCL) </li></ul></ul></ul><ul><ul><ul><li>Small shippers pay the consolidator less than they would pay the airline themselves </li></ul></ul></ul><ul><ul><ul><li>More waiting time for consolidation </li></ul></ul></ul><ul><ul><ul><li>Freight forwarding service by freight consolidator </li></ul></ul></ul><ul><ul><ul><li>Export customs clearance service by freight consolidator </li></ul></ul></ul>
  6. 6. Air Transportation <ul><li>Air freight carriers </li></ul><ul><ul><li>International couriers </li></ul></ul><ul><ul><ul><li>Documents and small packages </li></ul></ul></ul><ul><ul><ul><li>House to house service </li></ul></ul></ul><ul><ul><ul><li>One to three day guaranteed delivery </li></ul></ul></ul><ul><ul><ul><li>DHL, UPS, Federal Express, Emery, US Postal Service </li></ul></ul></ul>
  7. 7. Ocean Transportation <ul><li>Least expensive transportation mode </li></ul><ul><li>Faster, more fuel-efficient vessels </li></ul><ul><li>Shipping lines </li></ul><ul><ul><li>Usually own the cargo vessels </li></ul></ul><ul><ul><li>Operate the cargo vessels </li></ul></ul><ul><ul><li>Belongs to Conference or Non-conference </li></ul></ul>
  8. 8. Ocean Transportation <ul><li>NVOCC 's (Non-Vessel Operating Common Carriers) </li></ul><ul><ul><li>Do not own or operate the vessels </li></ul></ul><ul><ul><li>Freight consolidators and wholesalers: Less freight than shipping lines for small shipments </li></ul></ul><ul><ul><li>Specialized in LCL cargoes-- Small shipments in a container without expensive export crating </li></ul></ul><ul><ul><li>Have a warehouse or terminal for receiving and consolidating small shipments </li></ul></ul><ul><ul><li>Have own rate tariffs filed with the Federal Maritime Commission </li></ul></ul><ul><ul><li>Issue a negotiable ocean bill of lading </li></ul></ul>
  9. 9. General Cargo <ul><li>Packaged cargo transported not in container </li></ul><ul><li>Fiberboard (Cardboard) box, crate(wooden box), fiber drum, steel drum, wooden barrel, bag or sack, and bale </li></ul><ul><li>Loaded in the cargo holds </li></ul><ul><li>Refrigerated holds for frozen meat or fresh fruit </li></ul>
  10. 10. Bulk Cargo <ul><li>Cargo without package </li></ul><ul><li>Dry bulk cargo: Coal, grain, ore, gravel loaded into the holds by cranes or clamshells or conveyor system </li></ul><ul><li>Liquid bulk cargo: Gasoline, edible oil, liquidified natural gas (LNG) or liquidified petroleum gas (LPG) loaded into the tank by piping system </li></ul>
  11. 11. Container Cargo <ul><li>Packaged cargo transported in a container </li></ul><ul><li>House to house service </li></ul><ul><li>Shipper's load and count notation on the B/L </li></ul><ul><li>Unloaded to Container Freight Station (CFS) in the case of more than one cargo owner and Container Yard (CY) in the case of one cargo owner </li></ul>
  12. 12. Container Cargo <ul><li>Container size (Outside dimension) </li></ul><ul><ul><li>Standard: </li></ul></ul><ul><ul><ul><li>20 Footer: W.8' x H.8' 6&quot; x L.20' (7' 8&quot;x 7' 10&quot;x 19' 4&quot;) </li></ul></ul></ul><ul><ul><ul><li>40 Footer: W.8' x H.8' 6&quot; x L.40' (7' 8&quot;x 7' 10&quot;x 39' 4&quot;) </li></ul></ul></ul><ul><ul><li>High Cube : </li></ul></ul><ul><ul><ul><li>40 Footer: W.8' x H.9' 6&quot; x L.40' (7' 8&quot;x 8' 10&quot;x39' 4&quot;) </li></ul></ul></ul><ul><ul><ul><li>45 Footer: W.8' x H.9' 6&quot; x L.45' (7' 8&quot;x 8' 10&quot;x44' 4&quot;) </li></ul></ul></ul>
  13. 13. Container Cargo <ul><li>Specialized container </li></ul><ul><ul><li>Tanker container </li></ul></ul><ul><ul><li>Refer container </li></ul></ul><ul><li>Advantages of containerization </li></ul><ul><ul><li>No need for expensive crating </li></ul></ul><ul><ul><li>Prevents theft at the dock </li></ul></ul><ul><ul><li>Fast loading & unloading leading to savings on both time and money </li></ul></ul><ul><ul><li>Savings on freight through consolidation of small shipments </li></ul></ul>
  14. 14. Ocean Freight Cost <ul><li>Pure freight : Rate tariff published & filed with the FMC </li></ul><ul><li>Surcharges : Add-on costs after pure freight published </li></ul><ul><ul><li>Currency Adjustment Factor (CAF): When US dollar drops, CAF goes up. </li></ul></ul><ul><ul><li>Fuel Adjustment Factor (FAF): Bunker charge. When price of bunker c fuel increases, FAF goes up </li></ul></ul><ul><ul><li>Terminal Handling Charges (THC): Charges for moving cargoes on the pier, loading or unloading. Regular lines usually include these charges in the ocean freight </li></ul></ul>
  15. 15. Ocean Bill of Lading <ul><li>Negotiable Bill of Lading: Order Bill of Lading </li></ul><ul><ul><li>Made out &quot;To order&quot; or To the order of ----.&quot; </li></ul></ul><ul><ul><li>Cargoes are released only on presentation of an original bill of lading duly endorsed by the shipper or consignee named in the bill of lading </li></ul></ul><ul><li>Non-Negotiable Bill of Lading: Straight B/L </li></ul><ul><ul><li>Consigned to the importer. Cargoes are released only to the consignee. Endorsement not needed </li></ul></ul>
  16. 16. Ocean Bill of Lading <ul><li>Long form B/L: </li></ul><ul><ul><li>It contains all terms & conditions of carriage printed on the reverse side of the B/L </li></ul></ul><ul><li>Short form B/L: </li></ul><ul><ul><li>It contains some of terms and conditions by reference to a source or document </li></ul></ul>
  17. 17. Non-Negotiable Sea Waybill <ul><li>Cargoes are released only to the consignee on the Sea Waybill without surrendering an original Sea Waybill. </li></ul><ul><li>Often used </li></ul><ul><ul><li>When consignee, or importer does not need to sell the goods during transit </li></ul></ul><ul><ul><li>Specially convenient in the case of a very short transit time. </li></ul></ul><ul><li>Processing shipping documents through exporter’s bank and importer’s bank take several days </li></ul>
  18. 18. Multimodal Transport Document <ul><li>Multimodal (Combined or Intermodal) Bill of Lading </li></ul><ul><li>Covers two or more transportation modes: truck or rail – vessel-truck or rail </li></ul><ul><li>Covers all transportation from the place dispatched, taken in charge or shipped on board to the place of final destination </li></ul>
  19. 19. Letter of Credit and Ocean Bill of Lading <ul><li>Ocean Bill of Lading must conform to conditions of Letter of Credit (UCP 600) </li></ul><ul><li>To be accepted by banks, a bill of lading must appear to </li></ul><ul><ul><li>indicate the name of the carrier and be signed by the carrier or its agent, or master or its agent </li></ul></ul><ul><ul><li>indicate that goods have been shipped on board on a named vessel at the port of loading stated in the Credit </li></ul></ul><ul><ul><ul><li>Shipment date: the date of B/L issuance or On Board notation date </li></ul></ul></ul>
  20. 20. Letter of Credit and Ocean Bill of Lading <ul><li>To be accepted by banks, a bill of lading must appear to (continued) </li></ul><ul><ul><li>indicate shipment from the port of loading to the port of discharge stated in the Credit </li></ul></ul><ul><ul><li>be the sole original or the full sets of originals as so issued </li></ul></ul><ul><ul><li>contain the terms & conditions of carriage </li></ul></ul><ul><ul><li>contain no indication subject to a charter party </li></ul></ul>
  21. 21. Letter of Credit and Ocean Bill of Lading <ul><li>If the Credit calls for a multimodal bill of lading, it must appear to </li></ul><ul><ul><li>indicate that goods have been dispatched, taken in charge or shipped on board at the place stated in the Credit with the date dispatched, taken in charge of shipped on board </li></ul></ul>
  22. 22. Letter of Credit and Ocean Bill of Lading <ul><li>If the Credit calls for a multimodal bill of lading, it must appear to (continued) </li></ul><ul><ul><li>indicate the place of dispatch, taking in charge or shipment and the final destination of stated in the Credit, even if </li></ul></ul><ul><ul><ul><li>it states a different place of dispatch, taking in charge or shipment or place of final destination or </li></ul></ul></ul><ul><ul><ul><li>it contains the indication “intended” as to the vessel, port of loading or port of discharge </li></ul></ul></ul><ul><ul><li>meet other terms & conditions of a standard bill of lading </li></ul></ul>
  23. 23. Letter of Credit and Ocean Bill of Lading <ul><li>Banks accept a bill of lading which </li></ul><ul><ul><li>bears a clause of “shipper’s load and count” or “said by shipper to contain” in container shipment </li></ul></ul><ul><ul><li>indicates as the shipper or consignor of the goods a party other than the beneficiary of the Credit (3 rd party B/L) </li></ul></ul><ul><ul><li>indicates that transshipment will or may take place if cargo shipped in Container, Trailer or LASH (Lighter Aboard Ship) barge and covered by one B/L even if the L/C prohibits transshipment </li></ul></ul><ul><ul><li>bears a reference to charges additional to the freight. </li></ul></ul>
  24. 24. Letter of Credit and Ocean Bill of Lading <ul><li>Banks reject a bill of lading which </li></ul><ul><ul><li>states that the goods are or will be loaded on deck </li></ul></ul><ul><ul><li>indicates a defective condition of the goods or the package: Not clean B/L </li></ul></ul><ul><ul><li>shows a transshipment, if it is prohibited by the Credit, unless it is a multimodal transport document or the cargo is shipped in Container, Trailer or LASH </li></ul></ul>
  25. 25. Letter of Credit and Ocean Bill of Lading <ul><li>Common discrepancies in Bill of Lading </li></ul><ul><ul><li>Less than a full set of original Bill of Lading presented </li></ul></ul><ul><ul><li>Changes not initialed by the signor of the B/L </li></ul></ul><ul><ul><li>Not properly endorsed </li></ul></ul><ul><ul><li>No &quot;On Board&quot; notation indicating the date of shipment and the name of the actual vessel, if the B/L contains the indication “intended vessel“ or similar qualification such as “Received for shipment” </li></ul></ul><ul><ul><li>Date of the B/L later than shipping date in the L/C </li></ul></ul>
  26. 26. Letter of Credit and Ocean Bill of Lading <ul><li>Common discrepancies in Bill of Lading (continued) </li></ul><ul><ul><li>Stale B/L not presented to the negotiating bank within specified time after shipment stipulated in the L/C (Presentation date) </li></ul></ul><ul><ul><li>Different markings from L/C </li></ul></ul><ul><ul><li>Different description of the goods from L/C in general terms </li></ul></ul><ul><ul><li>Not clean (foul) B/L with a notation of defective goods or packages </li></ul></ul><ul><ul><li>On-deck shipments </li></ul></ul>
  27. 27. Parties Responsible for Shipping Arrangements <ul><li>Under a CFR or CIF Transaction </li></ul><ul><ul><li>Exporter is responsible for shipping arrangement, loading, paying freight or freight & marine insurance premium </li></ul></ul><ul><ul><li>Exporter may ship by the least expensive vessel even though it is the slowest. Long voyage is a waste of time and money. </li></ul></ul>
  28. 28. Parties Responsible for Shipping Arrangements <ul><li>Under FOB Transaction </li></ul><ul><ul><li>Importer is responsible for shipping arrangement, paying ocean freight and marine insurance premium </li></ul></ul><ul><ul><li>Exporter responsible for loading the cargo on the carrier </li></ul></ul><ul><ul><li>Exporter may ship by the most convenient vessel even though its freight is higher than other vessels. </li></ul></ul>
  29. 29. Parties Responsible for Shipping Arrangements <ul><li>First, import on a CFR or CIF basis </li></ul><ul><li>Second, if you can get a better freight rate, then change to the FOB </li></ul><ul><li>FOB ties up line of credit less than CFR or CIF, specially when the freight portion is very high. </li></ul>
  30. 30. Arrival Notice <ul><li>Carrier unloads Containers with one cargo owner to C.Y. (Container Yard) and Containers with more than one owner to C.F.S. (Container Freight Station) </li></ul><ul><li>Arrival Notice to “Notify Party” in the B/L indicating ETA and wharf demurrage starting date, generally </li></ul><ul><ul><li>8 th day after vessel arrival for CY cargos </li></ul></ul><ul><ul><li>13 th day for CFS cargos excluding weekend & holidays </li></ul></ul><ul><ul><li>Much shorter free period for reefer containers </li></ul></ul>

×