Chartering Definitions

ACCEPTANCE Any agreement to purchase goods under specified terms. An agreement to purchase
goods at a state price and under stated terms.

ACT OF GOD It is a natural event, not preventable by any human agency, such as flood, storms, or
lightning. Forces of nature that a carrier has no control over, and therefore cannot be
held accountable.

ADDENDUM Whenever the terms in a fully signed C/P are amended by subsequent negotions an
addendum is prepared by the charterer's broker (and forms a part of the C/P). It comes
into effect only when it is signed by all parties just like the original C/P.

ADDRESS COMMISSION Commission payable to the charterer by the shipowner as a percentage of freight or hire.
Historically it was paid to the charterer to cover up some of the expenses incurred by
him. At present it virtually works out to a reduction in the freight.

ADVANCE FREIGHT Partial payment of the bill of lading freight in advance; in other respects is the same as
guaranteed freight. In other words, freight payable before goods are accepted for
shipment. Once paid it can not be recovered from the shipowner upon frustration on
voyage and loss of goods.

AFRAMAX Tanker of maximum 79,999 dwt on the AFRA freight rate assessment scale.

AFFREIGHTMENT The hiring of a ship in whole or part

AIR DRAFT This term has various meanings the most common being: The maximum height from the
water line to the top-most point of a ship.

AIR WAYBILL A bill of lading that covers both domestic and international flights transporting goods to a
specified destination. This is a non-negotiable instrument of air transport that serves as a
receipt for the shipper, indicating that the carrier has accepted the goods listed and
obligates itself to carry the consignment to the airport of destination according to
specified conditions.

ALL RISK The broadest form of coverage available, providing protection against all risks of physical
loss or damage from any external cause. Does not cover loss or damage due to delay,
inherent vice, preshipment condition, inadequate packaging, or loss of market.

ALL TIME SAVED Means that the time saved to a ship from the completion of loading/discharging to the
expiry of laytime including periods excepted from laytime.

ALL WORKING TIME SAVED or ALL Both these terms mean the same. Here the description of the time means that time
LAYTIME SAVED saved to the owner from the completion of the loading and/or discharging until the expiry
of the allowed laytime excluding and notice time and periods which are exceptions to
laytime.

ALONGSIDE A phrase referring to the side of a ship.

ALTERNATE HOLDS Iron ore being a very heavy cargo is loaded in alternate holds, leaving remaining holds
empty.

ALWAYS AFLOAT or ALWAYS This clause is inserted in a C/P to prevent a vessel from being ordered to proceed to a
SAFELY AFLOAT berth where she touches the ground during loading of discharging or which can only be
reached after lighterage of part of her cargo or which can only be reached during high
tide.
APPROVED CHARTERPARTY A charterparty which has been agreed upon, adopted or recommended by BIMCO,
G.C.B.S., etc.

ARBITRAGE The buying of foreign exchange, securities, or commodities in one market and the
simultaneous selling in another market, in terms of a third market. By this manipulation
a profit is made because of the difference in the rates of exchange or in the prices of
securities or commodities involved.

ARRIVAL PILOT STATION A point of identification at which a time-chartered vessel is delivered to the charterer (or
re-delivered to the shipowner). In this case the hire commences (or ends) as soon as the
vessel reaches the pilot station. (This term favours the shipowner vis-à-vis “taking
inward pilot” which favours the charterer).

ARRIVED SHIP A vessel is an arrived ship and the laytime allowed under the C/P begins to count as soon
as the following conditions have been complied with: 1) The vessel must have arrived at
the port, berth or dock as stated in the C/P. 2) The vessel must be ready to load or
discharge in every way. 3) A notice of readiness must have been given in writing to the
charterers or shippers/consignees.

AS FAST AS THE VESSEL CAN Means that the laytime is calculated by reference to the maximum rat at which the ship
RECEIVE/DELIVER in full working order is capable of loading or discharging the cargo, that is, as fast as she
can or with customary (quick) dispatch. The term appears in a C/P when laytime is not
fixed (indefinite) and is left to the custom of the port.

AUSTALIAN HOLD LADDERS All vessels trading with Australia must be provided with ladders acceptable to waterside
workers’ federation/ unions in that country. These ladders are so constructed as to
prevent fatigue due to platforms at regular intervals. Vessels without such type of
ladders can be penalized or delayed.

AVERAGE Any loss or damage due to insured perils that is less than a total loss. Two types of
average occur: Particular Average and General Average.

AVERAGING LAYTIME To average means to make separate calculations for lading and discharging and any time
saved in one operation can be set off against any excess time used in the other. The
option to average laytime is given to the charterer.

BACK FREIGHT freight charged for the return of goods which have not been accepted at the port of
destination. Also applied to goods discharged at another convenient port.

BALE CAPACITY The cubic capacity of a ship’s holds below deck, expressed in cubic feet or cubic metres,
available for the carriage of breakbulk type of cargoes, e.g.., packages, bales, cartons,
cartons, drums, pallets, etc., which are not capable of filling the space between the ship’s
frames.

BALLAST Heavy weight, often sea water, necessary for the stability and safety of a ship which is
not carrying cargo.
BALLAST BONUS
Sum of money paid by a time charterer to a shipowner (in a good market) to
compensate him for not finding a cargo near the place of re-delivery of the ship at the
end of the charter. The bonus serves as an incentive for the ballast (empty) trip to cover
up the cost of fuel and time. At times a shipowner pay pat the charterer a ballast bonus
when the vessel is being re-delivered at the end of time charter, specially when market is
not good for the shipowner.

BAR DRAFT This relates to the maximum draft enabling a vessel to pass over a bar, e.g., Martin
Garcia bar in the River Plate. In case the vessel has too great a draft, it will have to
discharge part of the cargo into barges and then reload it after passing the bar. A similar
situation exists at Yangon (formerly Rangoon). Such ports are called bar-ports.

BAREBOAT /DEMISE CHARTER Lease of a ship wherein the charterer takes over the ship together with the rigid of
management and control. In fact the becomes the virtual owner of the vessel during the
term of the charter. Charter has the right to engage and pay the master and crew who
are his employees. The shipowner merely receives compensation as hire payments.

BEAUFORT SCALE A scale of wind force expressed from 0 to 12 in which weather conditions represent with
conditions expressed in numerals, where 0 means calm wind (less that I knot speed) and
12 refers to hurricane (speed between 64 to 71 knots). This term is used mostly in time
charterparties, as vessels are not penalised for non-performance of speed in case wind
speed is more than the agreed Beaufort number.

BEFORE BREAKING BULK Refers to the time when freight is paid. In this case freight is to be paid any time before
commencement of discharge.

BELOW BRIDGES If a ship has to pass under a bridge across a canal to reach the port or berth it has to
ensure that its draft permits the vessel to have sufficient clearance above its highest
point to pass under the bridge with ease.

BENEFICIARY The person in whose favor a draft is issued or a letter of credit opened.

BERTH The specific place where ships are anchored for loading and/or discharging at the docks
in a port.

BERTH CHARTER If a vessel chartered for loading on a particular berth, the contract is called berth charter.
The term berth charter implies that notice of readiness cannot be given until the vessel is
in the designated berth as required by the charterers.

BERTH TERMS Also referred to as “liner terms”. The Shipowner pays for loading and discharging subject
to the custom of the port or as fast as the ship can handle the cargo or under customary
dispatch.

BILL OF LADING The document issued on behalf of the carrier describing the kind and quantity of goods
being shipped, the shipper, the consignee, the ports of loading and discharge and the
carrying vessel. It serves as a document of title, a contract of carriage, and a receipt for
goods.

BLACK LIST List of countries published by a government which will not allow ships to trade at its
ports if they have traded at ports in the countries on that list.
BONDED WAREHOUSE A building authorized by Customs authorities for storage of goods on which payment of
duties is deferred until the goods are removed.

BOTH ENDS The term means that the arrangements agreed upon hold true both at loading and
discharging ports, e.g., rate of loading and discharging; appointment of agents, etc.

BRACKISH WATER ARRIVAL DRAFT Brackish is spoken of water in a river when partly salt and partly fresh. It has a density
between that of fresh water (1000 kgs/cubic metre) and that of salt water (1025
kgs/cubic metre). When a ship proceeds to a brackish water port, the ship’s draft will be
more than the draft in salt water and less than the draft in fresh water.

BREAK BULK Loose cargo, such as cartons, stowed directly in the ship's hold as opposed to
containerized or bulk cargo. See "Containerization."

BREAKBULK Describes loose cargo, such as cartons, bales, boxes, packages, etc stowed directly in the
ship's hold as opposed to containerised or bulk cargo.

BREAKING BULK The expression means “to start the discharge.”

BROKEN STOWAGE The space wasted in a ship’s holds when stowing general cargo which is uneven and
packed.

BROKER (SHIP) A shipbroker acts as a middleman between the shipowner and the charterer and
negotiates the terms of a C/P. He represents one party (say, shipowner) and negotiates
with the other party (charterer) directly or with another broker who represents the
charterer. (A sale and purchase broker negotiates for the sale of a ship and represents
the shipowner).

BROKERAGE Brokerage is a commission paid to the shipbroker by the shipowner for the broker’s time,
effort and expenses in concluding a (successful) fixture, normally a certain percentage of
the hire of freight earned by the shipowner.

BULK SHIPMENTS Shipments which are not packaged, but are loaded directly into the vessel's holds.
Examples of commodities that can be shipped in bulk are ores, coal, scrap, iron, grain,
rice, vegetable oil, tallow, fuel oil, fertilizers, and similar commodities.

BUNDLING This is the assembly of pieces of cargo, secured into one manageable unit. This is
relevant to items such as Structural Steel, Handrails, Stairways etc. Whilst this is a very
flexible description, a rule of thumb is to present cargo at a size easily handled by a large
(20 tonne) fork lift truck.

BUNKER ADJUSTMENT FACTOR A Fuel Surcharge expressed as a percentage added or subtracted from the freight
amount, reflecting the movement in the market place price for bunkers.

BUNKERS Name given for vessels Fuel and Diesel Oil supplies (Originates from coal bunkers)

COST & FREIGHT (Cost and Freight) Seller owns goods until they are loaded on vessel; selling price
includes all costs so far plus cost of freight. The buyer is responsible for insurance.

COST, INSURANCE AND FREIGHT Seller owns goods until they are loaded on vessel; selling price includes cost of goods,
insurance, and freight.

CALCULABLE LAYTIME By doing certain tonnage and hatch calculations one can work out the exact laytime
available for cargo operations.

CALENDAR MONTH A month according to a calendar, e.g., if a vessel is taken up on time charter for say 6
 months and has been delivered on 10th June, the charter will expire on 10th December.

CANCELLING DATE The date, mutually agreed upon between the shipowner and the charterer, on which the
vessel must be ready to lad at the latest is called the canceling date. Should the vessel
miss her canceling date, the charterers are entitled to cancel the C/P

CAPESIZE Vessels too large for the Panama and/or the Suez Canal are termed Capesize.

CARGO Goods, merchandise or commodities of every description which may be carried aboard a
vessel, in consideration of the freight charged; does not include provisions and stores for
use on board.

CARNET A customs document permitting the holder to carry or send merchandise temporarily into
certain foreign countries (for display, demonstration, or similar purposes) without paying
duties or posting bonds.

CARRIAGE OF GOODS BY SEA ACT 1936 U.S. Statute that governs the acts that a carrier is responsible for and defines the
(C.O.G.S.A.) terms used in shipping. The act provides that the shipowner's liability will be limited to
$500 per shipping package, and it stipulates a one-year time limit for filing suit against
the carrier. This act automatically applies to international ocean movements but not to
domestic ocean transits unless the carrier agrees to be bound by it.

CARRIER Usually means Steamship Company, but can also refer to trucking company, airline, or
railroad as transporter of cargo.

CENTISTOKES Describes viscosity of fuel oils—380 c/s or 180 c/s (better). The greater the number of
centistokes, the higher the viscosity of the oil and cheaper the cost. (Viscosity is the
ability of liquid to resist flow, e.g., honey is more viscous than lemon juice).

CERTIFICATE OF INSPECTION A document often required with shipments of perishable or other goods, when
certification notes the good condition of the merchandise immediately prior to shipment.

CERTIFICATE OF MANUFACTURE A statement sometimes notarized by a producer, usually also the seller, or merchandiser
that indicates the goods have been manufactured and are at the disposal of the buyer.

CERTIFICATE OF ORIGIN A specified document, required by certain foreign countries for tariff purposes, certifying
the country of origin of the merchandise. Sometimes requires the signature of the consul
of the country to which it is destined.

CHART DATUM Water level calculated on the lowest tide that can ever occur and used as a basis for
chart measurements.

CHARTER PARTY A written contract between the owner of a vessel and the one (the charterer) desiring to
empty the vessel, setting forth the terms of the arrangement, i.e., freight rate and ports
involved in the contemplated trip.

CHARTERING AGENTS They are specially appointed by large importers or exporters to book space or vessels for
their shipments. All enquiries for tonnage are placed in the hands of these chartering
agents to the exclusion of any other broker. The chartering agents act as intermediaries
for their principals.

CLEAN BALLAST TANKS Water carried in a tanker or tanks which have no traces of oil. Hence such water is
referred to as clean ballast. Tanks carrying the water are therefore clean ballast tanks.

CLEAR DAY/S Means that the day on which the notice is given and the day on which the notice expires
 are not included in the notice period.

COLLECT FREIGHT Freight payable at destination provided the vessel delivers the goods as specified.

COMBI A ship specifically designed to carry both containers and conventional cargoes.

COMBIDOC Combined transport document issued by the Baltic and International Maritime Conference
(BIMCO)

COMMENCEMNT OF LAYTIME Laytime is said to commence once a vessel has arrived at a port, complied with all
stipulations and tendered the notice of readiness as specified in the C/P

COMMERCIAL INVOICE A statement of transaction between a seller and buyer prepared by the seller, and a
description of the merchandise, price, terms, etc.

COMMERCIAL SET Set of four "negotiable" documents that represents and takes the place of the goods
themselves in the financing of the cargo sales transaction.

COMMISSION PAST US Implies that the quote does not include the normal commission for the brokers quoting
the order.

COMMON CARRIER Transporter who holds himself out to the general public for the transportation of goods
over a definite route and according to a regular schedule.

CONGESTION In order to avoid loss to owners due to non-availability of the berth or waiting at the
anchorage, C/Ps specify that the notice of readiness can be tendered by the master
“whether in berth or not (wibon), whether in free pratique or not (wifpon), and whether
customs cleared or not (wccon)

CONSECUTIVE VOYAGES
A named vessel may be employed on a series of voyages called consecutive voyages
against a single C/P. The vessel proceeds loaded from loading to discharging port only to
return in ballast and repeat the following voyage on same terms and conditions until all
the cargo has been shipped. However, separate calculations of freight and laytime are
made for the individual voyages. It differs from a COA where the shipowner can use any
ship and the freight rates take into account the cost of ballast return voyage from
discharge to load port.

CONSIGNEE Party who is to receive the good; usually the buyer.

CONSIGNMENT Merchandise shipped to a foreign agent or customer when an actual purchase has not
been made, but under an agreement obliging the consignee to pay the consignor for the
goods when sold.

CONSOLIDATION The Consolidation Endorsement may be added to an Open Cargo Policy at an agreed
premium, to provide coverage on merchandise while in transit to, and while at, a
common consolidation point for the purpose of preparing or consolidating the
merchandise for export.

CONSULAR DOCUMENTS Bills of lading, certificates of origin or special invoice forms that are officially signed by
the consul of the country of destination.

CONSULAR INVOICE A detailed statement of goods shipped certified by the consul at the point of shipment.

CONTAINERIZATION Shipping systems based on large cargo-carrying containers ranging up to 48 feet long
 that can be easily interchanged between trucks, trains and ships without rehandling the
contents.

CONTRABAND During the time of war, materials carried aboard a vessel that could aid a belligerent in
the process of the war, such as arms, weapons or munitions.

CONTRACT OF AFFREIGTMENT
In chartering this terms refers to a shipowner (or charterer) who enters into a contract to
carry a large quantity of cargo between named port or regions on mutually agreed terms
and conditions over a period of time. The shipowner may employ his own vessels or
charter other vessels to meet his commitments. This ships used for the carriage are not
named. As each shipment takes place a fresh voyage charter is entered into between the
parties. This gives the shipowner sufficient flexibility.

CROSS TRADE To trade a ship wherever suitable cargoes are available, rather then carrying cargoes to
and from the country where the ship is registered.

CURRENT ADJUSTMENT FACTOR This takes account of the rate of exchange variations. Owners are required to pay costs
in local currency in the country of loading and discharging. It is a percentage of the base
rate.

CUSTOMARY DESPATH or The charter is required to discharge and/or load as quickly as possible (as fast as can)
CUSTOMARY QUICK DESPATCH depending on the custom of the port. There is no fixed time allowed to the charterer.
Hence the term is not favourable to the shipowner as the laytime is indefinite and
uncertain.

CUSTOME OF THE PORT This term relates to customs and practices which have been gradually established in the
course of time in a particular port. If a C/P provides loading and discharging according to
the custom of the port (or with customary dispatch or as fast as can) the laytime
becomes indefinite, a situation unfavourable to shipowners as they will find it difficult to
put a claim for demurrage or damages for detention.

CUSTOMS BROKER Licensed by U.S. Customs to clear shipments for clients, also can forward goods "In
Bond" to your port.

D/A-DOCUMENTS AGAINST Instructions from a shipper to his bank that the documents attached to a time draft for
ACCEPTANCE collection are deliverable to the drawee against his acceptance of the draft.

D/P-DOCUMENTS AGAINST Instructions a shipper gives to his bank that the documents attached to a draft for
PAYMENT collection are deliverable to the drawee only against his payment of the draft.

DAILY RUNNING COST Cost per day of operating a ship.

DAMAGES FOR DETENTION Penalty if cargo is not ready when ship arrives for working (1st day of Laycan). This is
not detention which is charged for ships time on delay. If the cargo is ready there is no
DAMFORDET.

DATE ON CHARTER PARTY The actual date on which the fixture negotiations are finally concluded, after all subjects
have been lifted.

DAY Means a continuous period of 24 hours which, unless the context otherwise requires,
runs from midnight to midnight.
DAYS ALL PURPOSES total time for both loading and discharging. (See reversible laytime).

DEAD FREIGHT Where a charterer or shipper fails to fulfil his contract to load the cargo or the full cargo,
he commits a breach of the contract for which he is liable to pay damages. These
damages are known as dead freight. In other words, payment for space booked on a
vessel but not used.

DEADWEIGHT CARGO CAPACITY Weight of the cargo only which a ship can carry when immersed to her summer loadline.
It is the deadweight all told less weight of bunkers, fresh water, constants, etc.

DEADWEIGHT TONNAGE Signifies the carrying capacity of a vessel and includes bunkers, fresh water, cargo
and/or passengers and constants. The difference between the displacement of a vessel
on her light draft and her loaded draft represents the deadweight capacity in tons (or
tones). Also called deadweight all told.

DECK CARGO Cargo carried outside rather than within the enclosed cargo spaces of a vessel.

DECK LINE 12” (or 300mm) line painted amidships on both sides and parallel to the loadlines. The line is
located at the point where the upper most continuous deck, known as the freeboard
deck, meets the side of the ship.

DEFINITE LAYTIME One of the three forms of laytime (the other two being “calculable” and “indefinite”). The
charterparty specifies the days/hours allowed for loading and/or discharging.

DELAY Even under All Risk coverage, damage due to delay is not recoverable. Most underwriters
have inserted a "Delay Cause" in the Open Cargo Policy, which states specifically that
damage caused by delay is not recoverable even if the delay was due to a peril insured
against.

DELIVERY & RE-DELIVERY A time charter commences with the delivery of the vessel to the charterer and comes to
an end with the re-delivery of the vessel to the owner. The delivery or re-delivery can
occur at a port or a place agreed upon, e.g., passing Skaw (northern tip of Denmark, at
the entrance of the Baltic Sea); passing Cape Passero (south-east coast of Italy); passing
Key West (Florida), or any other position.

DEMURRAGE Money (compensation) payable to the shipowner by a charterer for delay for which the
owner is not responsible in loading and/or discharging after the laytime stipulated in the
C/P has expired.

DESPATCH / DESPATCH MONEY The money (bonus) payable by the shipowner to the charterer if the vessel completes
loading or discharging before the expiry of laytime stipulated in the C/P. usually half the
demurrage rate.
DETENTION & DEMAGES FOR
DETENTION
If demurrage has not been agreed in the charterparty, the shipowner can claim
compensation as damages for detention. A case where a shipowner can claim damages
for detention is when a vessel is chartered to load at a berth where the vessel must be
always afloat. However the charterer directs the vessel to a berth where the vessel is not
always afloat. Since it has been agreed in the C/P that NOR can be tendered and laytime
to commence whether the vessel is in berth or not (wibon), the master refuses to comply
with the berthing orders. The shipowner in this case may not be able to put a claim for
demurrage. However, he may be entitled to “damages for detention”.

DEVIATION CLAUSE
Deviation is an intentional departure from the set or agreed course of the voyage. The
ship is not permitted to leave this route for any purpose without justification. To protect
themselves the shipowners enter a clause in the charterparty called the “deviation
clause” which allows them to deviate to save or attempt to save life and/or property at
sea and to give the owners the right to deviate for bunkering purpose (by inserting
another clause called the “P & I Bunkering Clause”).

DISBURSEMENTS Sums paid out by the ship’s agent on behalf of a shipowner and recovered subsequently.

DISPLACEMENT LIGHT Weight of the vessel without bunkers, fresh water, cargo and/or passengers and
constants.

DISPLACEMENT LOADED Weight of the vessel plus bunkers, fresh water, cargo and/or passengers and constants.

DISPONENT OWNER A charterer who has control of the vessel (e.g. under a bareboat or time charter) is
referred to as a “disponent owner”. During the duration of the charter, he acts as if he
were the real owner.

DISTANCE FREIGHT The expression is used in connection with discharge of cargo at a port other than the
original port of destination. For instance, if the vessel runs the risk of being frozen in, the
master may deem it advisable to deliver the cargo at the nearest safe port. If the extra
distance is worthwhile he can claim distance freight.

DISTRESS FREIGHT When a chartered vessel is being loaded at the berth and charterers find it difficult to
secure completion of cargo at normal rates, they may book cargo at very low rates
(called distress rates) in order to fill up the remaining space rather than allow the vessel
to be dispatched with empty space.

DOCK RECEIPT Receipt issued by an ocean carrier or its agent for merchandise delivered at its dock or
warehouse awaiting shipment.

DOCUMENTARY CREDIT A commercial letter of credit providing for payment by a bank to the name beneficiary,
usually the seller of merchandise, against delivery of documents specified in the credit.

DOCUMENTS Papers customarily attached to foreign drafts, consisting of ocean bills of lading, marine
insurance certificates, and commercial invoices, and where required, including certificates
of origin and consular invoices.
DOWN TO HER MARKS When a vessel is immersed to the appropriate loadline and therefore cannot load any
further cargo.

DRAFT Buyer's payment for goods.

DRAFT OR DRAUGHT Depth to which a ship is immersed in water. The depth varies according to the design of
the ship and will be greater or lesser depending not only on the weight of the ship and
everything on board, but also on the density of the water in which the ship is lying.

DRAFT SURVEY Survey undertaken to determine the quantities of cargo on board a ship.

DROPPING LAST OUTWARD SEA Some ports require the service of more than one pilot to be used, one from the berth to
PILOT the beginning of the channel and another called the sea-pilot for navigation within the
channel to the river and canal outside the port limits. In this case the off-hire (or on-
hire) survey will be carried out only when the sea-pilot (who navigates the vessel outside
the port limits) disembarks from the ship.

DROPPING OUTWARD PILOT A point of delivery on to and re-delivery off a time charter. The point where an “on-hire”
or “off-hire” survey takes place is that place where the pilot who assists the ship in
navigation to the pilot station disembarks from the ship. A point in owner’s favour as
expenses into and out of a port (e.g., hire of a tug) will be for charterer’s account.

DUNNAGE Materials of various types, often timber or matting, placed among the cargo for
separation, and hence protection from damage, for ventilation and, in the case of certain
cargoes, to provide space in which the tynes of a fork lift truck may be inserted.

DUTY (a) ad valorem duty means an assessed amount at a certain percentage rate on the
monetary value of an import. (b) Specific duty: an assessment on the weight or quantity
of an article without preference to its monetary value or market price. (c) Drawback: a
recovery in whole or in part of duty paid on imported merchandise at the time of
exportation, in the same or different form.

ECONOMIC SPEED Speed of a ship which is lower than its normal speed. It provides a reduction in fuel cost
as less fuel is consumed.

EVEN IF USED Time spent in carrying out loading and/or discharging in excepted periods (e.g., Shex
=Sundays and holidays excepted) is not to count as laytime, even if used. This
qualification of laytime is favourable to the charterer. “Unless used” has the opposite
effect and favours the shipowner.

EX (POINT OF ORIGIN) From the point where the shipment begins movement, e.g., "Ex Factory" "Ex Mine" or
"Ex Warehouse." See "Terms of Sale."

EXCEPTED Refers to laytime. Means that the specified days do not count as laytime even if loading
or discharging is done on them, e.g., Sundays and holidays excepted. Note that if
laytime has expired then the exceptions do not apply.

EXCEPTION CLAUSES Clauses in a C/P or B/L which relieve the carriers of responsibility of certain perils,
accidents or neglect. (See Hague Rules and COGSA).

EXCEPTIONS TO LAYTIME The happening of events agreed upon in the C/P which interrupt counting of laytime.
These give protection to the charterer. For e.g., a clause dealing with stoppage of work
due to strike would be a protective clause.

EX-DOCK (From dock.) Seller owns goods until they are unloaded on dock at port of discharge;
 selling price includes all costs so far plus cost of unloading from vessel.

EX-FACTORY Seller owns goods until they are picked up at his factory; selling price is the cost of the
goods.

EXPRESS CLAUSE In case what has actually been agreed is not very clear, then an express clause is
inserted in addition to the printed form drawing attention to the terms specifically agreed
upon.

FREE ALONGSIDE STEAMER Seller owns goods until they are delivered alongside vessel; selling price includes all
costs so far plus cost of transportation to dock.

FREE OF CAPTURE & SEIZURE Free of Capture & Seizure - Clause excluding war risks from the Marine Policy; war risks
can be covered by issuing a separate War Policy with an additional premium being
charged.

FREE ON BOARD TRUCK Seller owns goods until they are loaded on truck at his factory; selling price includes all
costs so far plus cost of loading on truck.

FREE ON BOARD VESSEL Seller owns goods until they are loaded on vessel; selling price includes all costs so far
plus cost of loading on vessel.

FREE ON BOARD WAREHOUSE (Free on board warehouse.) Seller owns goods until they are delivered to buyer's
warehouse at final destination; selling price includes all costs so far plus transportation to
final warehouse.

F.O.B./F.A.S. ENDORSEMENT If a merchant sells on F.O.B., F.A.S., C&F or similar terms, it is the buyer's responsibility
to place the insurance.

FAST AS CAN The term appears in a C/P when laytime is not fixed. It means that the laytime is
calculated by reference to the maximum rate at which the ship in full working order is
capable of loading or discharging the cargo as fast as she can. At times this term is
combined with the custom of the port or customary quick dispatch.

FIRM OFFER Used by the owner’s shipbroker in negotiations to indicate that the vessel is being offered
to only one possible charterer at a time. Conversely, the term could also be used by the
charterer’s shipbroker inviting owner’s shipbroker to submit a firm offer for a particular
order. It is a normal practice to include certain main terms in a firm offer.

FIRST CLASS CHARTERER When the name of the charterer is not revealed by his broker the charterer is referred to
as a first class charterer. However, it is risky to negotiate with such a charterer as his
record of payments cannot be cross-checked with BIMCO.

FIRST OPEN WATER The first date when a port is free from ice conditions to allow ships to enter,
load/discharge and leave safely, at the start of a new season. The term is commonly
used in the St Lawrence Seaway.

FIXTURE Conclusion of a shipbroker’s negotiations to charter (fix) a ship.

FIXING Chartering a Vessel

FLATPACKING Cargo to be presented stacked and secured as an integral unit.

FORCE MAJEURE The title of a standard clause in marine contracts exempting the parties for non-
fulfillment of their obligations as a result of conditions beyond their control, such as
earthquakes, floods, or war.
FORCE MAJEURE Circumstances beyond the control of one of the parties to a contract. E.g., Act of God.
This can relieve that party from performing the contract.

FREE ALONGSIDE Seller delivers goods to appropriate dock or terminal at port of embarkation and buyer
covers costs and risks of loading.

FREE (OF) TURN Time lost (if any) by a vessel for waiting its turn to berth to count as laytime against the
charterer. Opposite of “in regular turn”.

FREE DISCHARGE The charterer contracts to discharge the vessel, free of expense to the shipowner.

FREE DESPATCH If loading/discharging achieved sooner than agreed, there will be no freight money
returned.

FREE IN & OUT Distance measured amidships from the waterline to the main deck.

FREE IN & OUT AND SPOUT Charterer bears the expenses of the cargo to be loaded, spout trimmed and discharged,
TRIMMED free of expense to the shipowner (e.g., bulk wheat).

FREE IN & OUT AND STOWED Charterer bears the expenses of loading, stowing and discharging, free of expense to the
shipowner (e.g., bagged rice).

FREE IN & OUT AND TRIMMED Same as FIO plus that the cargo has also to be trimmed at the charterer’s expense, e.g.,
bulk cargo.

FREE IN & OUT STOWED AND Charterer bears the expenses of the cargo to be loaded, stowed, trimmed and discharged
TRIMMED free or expense to the shipowner (e.g., scrap iron).

FREE IN LINER OUT Charterer pays expenses at load port(s), while the shipowner pays the expenses at the
discharge port(s)

FREE ON BOARD Seller sees the goods _over the ship_s rail_ on to the ship which is arranged and paid
for by the buyer

FREE OUT Free of discharge costs to owners. Includes seafreight only.

FREE PRATIQUE This expression means that the vessel has a clean bill of health. (The health authorities
board the vessel in order to ascertain the correctness of the information given by the
master or the agent).

FREE TO CARRIER A modern equivalent of FAS used in intermodal transport where goods are transferred at
a nominated forwarder premises, depot or terminal but not actually put on board vessel.

FREE TRADE ZONE

A port designated by the government of a country for duty-free entry of any non-
prohibited goods. Merchandise may be stored, displayed, used for manufacturing, etc.,
within the zone and reexported without duties being paid. Duties are imposed on the
merchandise (or items manufactured from the merchandise) only when the goods pass
from the zone into an area of the country subject to the Customs Authority. Also called
FOREIGN TRADE ZONE

FREEBOARD Distance measured amidships from the waterline to the main deck.

FREIGHT The money charged by the carrier for transporting goods.

FREIGHT AT DESTINATION Freight payable at destination upon delivery of goods. Also referred to as “freight
 collect”.

FREIGHT TON Unit of cargo on which freight rate is based, either one tonne or one cubic metre.

FRESH WATER ALLOWANCE Loadline regulations permit extra draft when a vessel loads in fresh water, the reason
being that the vessel’s draft becomes less when she reaches open sea (salt water) where
the density of water is greater.

FRESH WATER ARRIVAL DRAFT Fresh water draft of a ship on arrival at a port.

FRIDASYS & HOLIDAYS EXCEPTED

Fhex applies to Muslim countries where Friday is observed as a holiday; Fhinc applies to
or FRIDAYS & HOLIDAYS
non-Muslim countries where Friday is not observed as a holiday.
INCLUDED

FRUSTRATION There is a question of frustration when through circumstances entirely beyond control of
parties commercial object of maritime adventure is entirely frustrated. The expression
“frustration of the adventure” in C/Ps relates to a delay of such a duration—without the
actual fault of either party—as to frustrate the charter.

FULL & COMPLETE CARGO Cargo required to fill a ship to capacity either by weight or cubic measurement.

GENERAL AVERAGE (G.A.) Ancient principle of equity in which all parties in a sea adventure (ship, cargo, and
freight) proportionately share losses resulting from a voluntary and successful sacrifice of
part of the ship or cargo to save the whole adventure from an impending peril, or
extraordinary expenses necessarily incurred for the joint benefit of ship and cargo.

GENERAL AVERAGE SECURITY Documents the cargo owner presents to the General Average Adjuster to replace the
vessel owner's maritime lien on cargo for its share of General Average and to obtain
release of the goods by the Steamship Company. G.A. Security consists of a G.A. Bond
and either a cash deposit or an Underwriter's Guarantee.

GOODS Cargo shipped by sea or air.

GRAB / GRAB DAMAGE Grab is a unit of cargo handling, consisting or two quarter circle metal parts which can be
brought together to make a close fit, operated by a crane or winch power. Grab damage
is damage to ship caused by use of the mechanical grabs.

GRAIN CAPACITY The capacity in cubic feet of the cargo hold in a ship measured to inside of the shell
plating. (If measured to the inside of the frames or cargo battens it is called bale
capacity is used for bulk cargoes e.g. grains, and bale capacity is used for general cargo,
e.g., pallets.

GROSS TERMS (GROSS CHARTER) Type of voyage charter in which the shipowner pays for tally, loading, stowing, trimming
and discharging costs. The alternative is fio, fios, fiot or foist where the cost of tally,
loading, discharging, etc., are for charter’s account. (However the port charges are paid
by the shipowner in all cases).
GROSS TONNAGE

The vessel’s internal space measured in units of 100 cu.ft. The certificate of tonnage
specifies the ship’s gross tonnage. (Generally speaking, gross tonnage is a measure of
the volume of a vessel and net tonnage represents the volume available for cargo, that
is, the revenue earning space in a vessel). Different tonnage measurement systems (i.e
British, Suez Canal or Panama Canal) have different tonnages for the same vessel.

GUARANTEED FREIGHT Freight payable whether the goods are delivered or not, provided the failure to deliver
the goods resulted from causes beyond the carrier's control.

HANDY SIZE / MAX Bulk carriers in the range of 20,000-50,000 tonnes dwt.

HARMONIZED SYSTEM An international commodity classification system, developed under auspices of Customs
Cooperation Council, adopted by the United States in 1989 and increasingly the most
widely accepted import/export classification methodology. Replaces SCHEDULE B export
codes and TARIFF SCHEDULE OF THE U.S. import codes.

HATCH COAMING Steel parapet surrounding a hatchway which rises vertically to prevent (i) a person from
falling into the hatch, and (ii) water from entering the hold.

HEAD CHARTERER Most C/Ps allow the charterer to sub-let or sub-charter the vessel to other charterers.
The original charterer is then called the “head charterer” or “disponent owner”.

HEAVY GRAINS, SOYA BEANS & What [SF44-49], soyabeans [SF48-52] and sorghums [SF 44-49] are considered as
SORGHUMS heavy grains. Also rye and maize are heavy grains. Barley and oats are classified as light
grains. In practice heavy-grains constitute the bulk of the grain shipments.

HEAVY HANDY DEADWEIGHT A type of scrap metal cargo. It is neither very light nor very heavy and is therefore called
SCRAP “handy” with a SF of between 48-52.

HIRE The payment for hiring a vessel on a time-chartered basis.

HOLIDAY Means a day of week (or part thereof) on which cargo work on the ship is suspended at
the place of loading/discharging by reason of the local practice or custom. The day may
usually be used for rest (Sunday) or may be observed as a religious festival (Christmas).

ICE CLAUSE To safeguard the shipowner that the vessel is sent to a safe port free from ice, a
protective clause dealing with ice, a protective clause dealing with ice conditions in
inserted in the C/P.

IN BOND A term applied to the status of merchandise admitted provisionally to a country without
payment of duties -- either for storage in a bonded warehouse or for trans-shipment to
another point, where duties will eventually be imposed.

IN GEOGRAPHICAL ROTAION If an option is given to the charterers to load or discharge a ship in more than one part
within a range of ports, it is important to state that if they exercise the option the ship
will proceed to the ports in geographical rotation (without, for example, going north and
south and then again north). This is important to the owner to determine the distance,
time and fuel expenses.

IN REGULAR (USUAL) TURN / Turn refers to the sequence in which a vessel may be allowed to berth for (coal) loading
TURN TIME or discharging by the port authorities due to congestion at the port (or availability of
 coal). Laytime does not generally count against the charterer while the ship is waiting its
turn. However, if the C/P says “free of tune” then time waiting for a berth will count.

IN TRANSITU On the passage.

IN WRITING Writing means in relation to a notice of readiness, a notice in any manner or mode and
includes fax, cable, telegram and telex.

INDEFINITE LAYTIME This arises in cases where the shipowner agrees for the vessel to be loaded/discharged
as fast as can, with customary dispatch, with customary quick dispatch or as per the
custom of the port. In such cases there is no way to determine the exact time the vessel
will take for loading and discharging.

INHERENT VICE A loss caused by the inherent nature of the thing insured and not the result of a casualty
or external cause.

INLAND BILL OF LADING A bill of lading used in transporting goods overland to the exporter's international carrier.

INSTITUTE WARRANTY LIMITS In insurance, a set of warranties (i.e. same as conditions, in insurance) in a hull policy
which prohibit the vessel from entering certain waters (mainly ice areas) without
payment of additional premium or with a change in conditions.

INTERCLUB AGREEMENT An agreement by 14 mutual associations concerning the method of settling liability of
cargo claims between shipowners and charterers. The Inter-Club New York Produce
Exchange Agreement is a clause in the NYPE time C/P.

INTERMODAL Carriage of a commodity by different modes of transport, i.e. sea, road, rail and air
within a single journey.

INTERNATIONAL TRANSPORT Organisation which looks after the welfare of transport workers and deals with their pay
WORKERS’ FEDERATION and working conditions. It issues the “ITF Blue Certificate” to a ship if its owner complies
with their requirements. Non-production of such a certificate can cause problems for a
vessel in all Australian ports and in some ports of other countries.

IRREVOCABLE LETTER OF CREDIT A letter of credit in which the specified payment is guaranteed by the bank if all terms
and conditions are met by the drawee.

JETTISON CLAUSE Clause in a B/L or C/P setting out the circumstances under which a master is entitled to
jettison goods from a vessel. (Jettison is to throw goods overboard for the purpose of
lightening the ship).

KEEL CLEARANCE Minimum distance between the bottom of a ship and the bed of sea, also called under
keel clearance.

LAYCAN Stands for “laydays commencing / laydays canceling” and is a spread of dates which
provides for the earliest date for the ship to arrive and for laytime to commence and also
gives the last date for the charterer to cancel the charter if the vessel does not arrive by
the date.

LAYDAYS The correct interpretation of this is the earliest time when the vessel is expected to be
ready for loading and/ or discharging. (Sometimes the word is used to refer to “laytime”
but then this leads to confusion. Laytime is the period allowed for the cargo to be loaded
and/or discharged).

LAYTIME Means the period of time agreed between the parties during which the owner will make
 and keep the ship available for loading/ discharging without payment additional to the
freight. The time allowed to the charterer is not indefinite. The time is either “fixed” or
“calculable”.

LAY-UP To stop trading a ship temporarily due to bad markets. During lay-up the daily running
lost of the ship is greatly reduced.

LANE METER A method of measuring the space capacity of Ro/Ro ships whereby each unit of space
(Linear Meter) is represented by an area of deck 1.0 meter in length x 2.0 meters in
width.

LENGTH OVERALL Maximum length between the extreme ends (forward and aft) of the ship. (Also referred
to as “overall length”).

LETTER OF CREDIT - COMMERCIAL A letter addressed by a bank, at the insurance and responsibility of a buyer of
merchandise, to a seller, authorizing him to draw drafts to a stipulated amount under
specified terms and undertaking conditionally or unconditionally to provide eventual
payment for drafts.

LETTER OF INDEMINITY A written statement in which one party (shipper) undertakes to compensate another
(shipowner) for the cost and/or consequences of carrying out a certain act, e.g.,
obtaining a release of goods without producing an original B/L.

LIEN The right to retain control of cargo until the charges related to it are paid.

LIGHT CARGO Goods which fill the ship cubically but do not bring it down to its marks are called light
cargoes. (Goods which bring the ship down to its marks but do not completely fill the
space available for cargo are called heavy cargoes).

LIGHTENNING (OR LIGHTERAGE) To reduce the draft of the vessel so as to enable it to enter the part/berth where the
depth of available water is restricted. This may be achieved by lightening or lighterage by
discharging part of the cargo in barges outside the port/berth.

LINER IN FREE OUT The shipowner bears all costs for loading (stowing, trimming etc.). The charterer (or
receiver/consignee) pays all costs incurred for discharge at the destination part.

LINER TERMS A rate that includes freight plus handling charges at loading and discharging ports.
(Similar to “Gross terms” used in bulk cargo tramp vessels).

LOAN RECEIPT Document signed by the Assured where he acknowledges receipt of money advanced by
the insurance company as an interest-free loan (instead of payment of a loss) repayable
to the insurance company only if the loss is recovered from a third party and then only to
the extent of the recovery.

LOSS OF MARKET A situation in which, for one reason or another, sound cargo is no longer wanted by the
consignee when it arrives. This is a "business loss" not recoverable under a Marine Cargo
Policy; e.g., Christmas trees arriving in January undamaged.

LOWEST ASTRONOMICAL TIDE It pre-supposes that at the very wors there would always be that depth of available
water at the particular spot.

LUMPSUM FREIGHT A fixed sum is paid to the shipowner regardless of the quantity of cargo actually shipped.

MANIFEST An itemized list by Bill of Lading number of the kind and quantity of all cargoes loaded
aboard a vessel, prepared by the vessel's Master.
MEAN DRAFT Average of forward and aft draft of a vessel.

MIN/ MAX Minimum and maximum cargo; a fixed quantity.

MORE OR LESS CHARTERER’S Gives the option to the charterer to increase or decrease the quantity of cargo by a
OPTION percentage agreed in advance.

MORE OR LESS OWNER’S OPTION Gives the option to the shipowner to increase or decrease the quantity of cargo by a
percentage agreed in advance, e.g., 10,000 tonnes 5% more or less in owner’s option,
means that the shipowner may load between 9500 to 10500 tonnes of cargo.

NAMED PERILS POLICY Any marine policy limiting coverage to perils specifically listed in the policy; opposed to
All Risks policy. See "All Risks."

NESTING Implies that cargo is presented stacked in the contour of similarly shaped cargo, it may
be likened to a stack of plates. This is particularly relevant in the presentation of
tankage strakes for transport.

NET CHARTER After delivery of the vessel in the first port of loading, the charterer pays all additional
port charges, cost of loading and discharging in the first and any additional port of
loading and in the port of discharge. After completion of discharge the vessel is re-
delivered to the owner and the outward port charges from the port of redelivery is for the
owner’s account. (Not a popular form of chartering nowadays).

NET TONNAGE The figure represents the total revenue earning space (volume) within a ship available
for the cargo. This is gross tonnage less “deductions” and less “allowances for propelling
machinery space” and is calculated in units of 100 cu.ft. (Net tonnage is also referred as
“register” tonnage).

NON-DEMISE CHARTERS Time and voyage charters fall under this category as opposed to demise and bareboat
charters.

NON-REVERSIBLE / NORMAL Means notice by the master or his agent to the charterer, shipper, receiver or any other
LAYTIME persons as required by the charterer, that the ship has arrived at the port or berth as the
case may be and is ready to load/discharge in all respects. Laytime begins to count from
the moment when NOR has been tendered by charterers/consignees.

OCEAN BILL OF LADING

Bill of lading indicating that the exporter consigns a shipment to an international carrier
for transportation to a specified foreign market. Unlike an inland B/L, the ocean B/L also
serves as a collection. If it is a straight B/L, the foreign buyer can obtain the shipment
from the carrier by simply showing proof of identity. If a negotiable B/L is used, the
buyer must first pay for the goods, post a bond, or meet other conditions agreeable to
the seller.

OFF-HIRE CLAUSE In a time C/P it specifies the circumstances under which hire is suspended or reduced.

ON DEMURRAGE Means that the laytime has expired. Unless the C/P expressly provides to the contrary
the time on demurrage will not be subject to the laytime exceptions.

ONCE ON DEMURRAGE ALWAYS ON Time on demurrage is continuous unless exceptions to demurrage are contained in the
DEMURRAGE C/P.
OPEN Said of a ship, which is available at a particular place to load her next cargo, having
discharged the last one.

OPEN CHARTER A C/P in which neither the ports of destination nor the nature of the cargoes are specified
and the vessel may fix for any cargo and for any ports.

OPEN POLICY A cargo policy with no expiration date that provides automatic coverage of cargo to or
from an Assured in a specified trade at agreed rates, terms, and conditions. Usually
consists of separate Marine and War policies.

OPEN PORT A port that is free of ice.

P & I BUNKERING CLAUSE The ship is permitted to deviate without breaking the contract for lifting bunkers at ports
where it may be cheaper.

PALLET A low portable platform, usually wooden, on which cargo is stacked for storage or
transportation; a skid.

PANAMAX A bulk carrier of about 65,000 tonnes deadweight whose dimensions enable her to transit
the Panama Canal where due to locks draft, beam and length are limiting factors.

PER HATCH PER DAY

The expressionis used to calculate laytime with reference to the number of cargo hatches
serving cargo compartments on the vessel. Laytime is to be calculated by multiplying the
agreed rate per hatch of loading/discharging the cargo by the number of ship’s hatches
and dividing the quantity of cargo by the resulting sum. Thus, Laytime= Quantity of
Cargo/Daily Rate x Number of Hatches = Days; A hatch that is capable of beign worked
by two gangs simultaneously shall be counted as two hatches.

PER WORKING HATCH PER DAY or

PER WORKABLE HATCH PER DAY This expression is more in charterer’s favour than “per hatch per day”. The word
“working” or “workable” hatch means that hatch can be worked because there is cargo in
the hold below it. Workability refers to the cargo and not cranes/derricks that serve the
hatch in question. Largest quantity in one hold/Daily rate per hatch x Number of hatches
serving that hold =Days; A hatch that is capable of being worked by two gangs
simultaneously shall be counted as two hatches.

PERILS OF THE SEA Fortuitous accidents or casualties, peculiar to transportation on a navigable water, such
as stranding, sinking, collision of the vessel, striking a submerged object, or
encountering heavy weather or other unusual forces of nature.

PHYTOSANITARY INSPECTION A certificate, issued by the US Department of Agriculture to satisfy import regulations for
CERTIFICATE foreign countries, indicating that a US shipment has been inspected and is free from
harmful pests and plant diseases.

PILFERAGE The theft of part of the contents of a shipping package.

POLITICAL RISK In export financing the risk of loss due to such causes as currency inconvertibility,
government action preventing entry of goods, expropriation or confiscation, war, etc.

PORT Means an area within which ships are loaded with or discharged of cargo, and includes
 the usual place where ships wait for their turn or are ordered or obliged to wait for their
turn, no matter the distance from that area.

PORT / PORTSIDE The left side of a vessel when viewed forward. (The right side is called starboard).

PRATIQUE License or permission to use a port

PRO FORMA INVOICE An invoice provided by a supplier prior to the shipment of merchandise, informing the
buyer of the kinds and quantities of goods to be sent, their value, and important
specifications (weight, size, etc.)

PROMPT SHIP Vessel that can be ready to load at short notice, say within a few delay.

REACHABLE ON ARRIVAL or The charterer undertakes that when the ship arrives at the port there will be a
ALWAYS ACCESSIBLE loading/discharging berth for her to which she can proceed without delay.

REVENUE TONNE Revenue Tonne (i.e. 1.0 metric Tonne or 1.0 cubic meter, whichever greater). The
overall RT is calculated on a line by line basis of the Packing List using the largest
amount. The overall freight liability is calculated on the total RT amount, multiplied by
the freight rate.

REVERSIBLE LAYTIME An option given to the charterer to add together the time allowed for loading and
discharging. When the option is exercised the effect is the same as a total time being
specified to cover both operations. Until the toal time expires, no demurrage becomes
payable. Opposite of normal or non-reversible laytime. (See “days all purposes”).

RIDER CLAUSES A set of additional clauses which substitute or supplement the clauses in the original
standard C/P form. If a rider clause contradicts a printed clause the rider clause prevails.

ROUND VOYAGE Voyage involving two legs, the second of which brings the ship back to the first port.

RUNNING DAYS / CONSECUTIVE Days which follow one immediately after the other. They are continuous. A working day
DAYS may exclude Sundays and holidays. But a running day does not exclude any day unless
provided in the C/P.

SAFE BERTH A berth which, during the relevant period of time, the ship can reach, remain at and
depart without being exposed to danger.

SAFE PORT A port which, during the relevant period of time, the ship can reach, enter, remain at and
depart without being exposed to danger.

SAFE WORKING LOAD Maximum load which can safely be carried by a crane or a derrick.

SALE & PURCHASE BROKER Person who negotiates the terms for the sale of a ship on behalf of the buyer or seller.

SALT WATER ARRIVAL DRAFT Vessel’s draft on arrival in salt water where the density of water is 1025 kg per cbm.

SAVAGE Action taken to save a ship or her cargo from loss or damage at sea. Property saved from
loss or damage at sea.

SCALE RATES Rates set by organizations which publish standard C/Ps. The scale rates contain daily
loading rates as well as demurrage rates. Applicable to bulk cargoes like coal, ores, etc.,
from specific countries.

SEAFREIGHT Costs charged for transporting goods over the sea. This does not cover any haulage or
loading/discharging costs but the sea transport only.

SEGREGATED BALLAST TANK Tank which is used for water ballast only.
SELF-TRIMMING SHIP Ship whose holds are shaped in such a way that a bulk cargo loaded into her will level
itself.

SHIFTING Time spent shifting between berths is generally taken to be for owner’s account, provided
it has been agreed that loading/discharging is at more than one berth. Also time spent in
shifting from the waiting place (anchorage) to the first cargo berth is generally not to
count as laytime.

SHIPPER'S EXPORT DECLARATION A form required for all shipments by the US Treasury Department and prepared by the
shipper, indicating the value, weight, destination, and other basic information about an
export shipment.

SHIPPER'S LOAD AND COUNT Note on bill of lading indication that the contents of a container were loaded and counted
by the shipper and not checked or verified by the Steamship Company.

SKIDS Are bearers (timber or steel) positioned under cargo to enable fork lift handling at port,
and for ease of rigging and lashing on board ship.

SPECIAL POLICY OF INSURANCE Document issued on behalf of the Underwriter stating the terms and conditions of the
marine insurance. Issued when evidence of insurance is required, as by the bank issuing
the Letter of Credit.

SPECIFIC GRAVITY Ratio of the weight of a liquid to its cubic capacity. Also called “relative density”. Water
has SG of 1.00 (1 cubic metre of water weighs 1 tonne).

SPIDERING Is the internal strengthening of circular tanks for transport, this prevents the tanks
becoming warped. The tanks are strengthened with steel or wood crossbeams giving a
_spider_ appearance.

SPOT A vessel which can commence loading immediately after the charter has been fixed. Also
used for cargo which is available for immediate loading.

SS OR SUBSTITUTE Such a condition in a C/P entitles the owner to replace the original vessel by another
ship, of same cargo capacity including class and suitability of laycan, for the fulfillment of
the charter.

STANDARD INTERNATIONAL A standard numerical code system developed by the United Nations to classify
TRADE CLASSIFICATION (SITC) commodities used in international trade.

STABILITY It is paramount that a vessel is stable in all respects at all times. When cargo is
loaded/discharged, the stability is monitored by a computer, which takes into account the
weight and position of cargo within the vessel.

STARBOARD The right side of a ship when looking forward. (By remembering that port and left both
have four letters, it is easier to remember which is port and which is starboard).

STATEMENT OF FACTS Statement prepared by an agent showing dates and times of arrival; commencement and
completion of loading and discharging; quantity loaded/discharged daily; hours
worked/stopped with reasons for break-down of equipments, etc.

STOWAGE FACTOR The space occupied by a ton (or tonne) of a commodity in a ship’s hold expressed in
cubic feet to the ton or cubic metres to the tonne Or Cubic space (measurement tonne)
occupied by one tonne (2,240 lbs/1,000 kgs) of cargo.

STRAIGHT BILL OF LADING A non-negotiable bill of lading in which the goods are consigned directly to a named
 consignee.

STRIKES Some C/Ps state that delays due to strikes are not to count as laytime.

SUBJECT STEM Implies that the vessel is fixed subject to the cargo quantity being available in the
laydays agreed upon.

SUBJECTS Means that the acceptance of the terms offered by the other side is “conditional” and
hence a conditional acceptance is not an agreement.

SUBROGATION The operation by which the insurance company (on payment of a claim) assumes all of
the assured's rights to recovery from any third parties; substitution of one creditor for
another.

SUEZMAX bulk carriers of about 150,000 tonnes dwt with a draft of 53’ which can transit the Suez
Canal fully laden.

SUNDAYS & HOLIDAYS EXDEPTED Under this expression Sundays and holidays will not count as laytime (excepted) /will
/ INCLUDED count as laytime (included).

SUPERCARGO A person on board representing the charterer who supervises cargo operations. Owners
feed the supercargo at a nominal rate but provide free of charge accommodation.

SURVEYOR A marine specialist who examines damaged property and determines the cause, nature,
and extent of damage and methods of repair and/or replacement. He is not an adjuster,
and all his actions are without prejudice to policy terms and conditions.

TAKING INWARD PILOT A point of delivery on to a time charter. The vessel’s delivery commences with the pilot
boarding the ship. If weather is bad pilot may not be able to board the vessel. Hence the
ship cannot be considered to be delivered. This term therefore favours the charterer,
whereas “arrival pilot station” is favourable to the shipowner.

TARE WEIGHT The weight of a container and packing materials without the weight of the goods it
contains.

TEN PERCENT BAGS FOR SAFE Some C/Ps stipulate that if a charterer loads in bulk, e.g., grain, 10% of the cargo must
STOWAGE be laoded in bags to bring the ship down to her marks.

TENOR The term fixed for payment of a draft.

TERMS OF SALE The invoice is the sales contract between buyer and seller and indicates the Terms of
Sale.

THROUGH BILL OF LADING A single bill of lading converting both the domestic and international carriage of an
export shipment. An air waybill is essentially a through bill of lading used for air
shipments. However, ocean shipments usually require two separate documents -- an
inland B/L for domestic carriage and an ocean B/L for international carriage. Through bills
of lading are insufficient for ocean shipments.

TIME CHARTER Employment of a vessel for a specific period of time, say, 2 months. The charterer has no
possession or control of the ship. The shipowner receives “hire” payments from the
charterer, usually so-much per day or pro-rata paid semi-monthly or monthly in
advance. Also called “period charter”.
TIME LOST WAITING FOR BERTH
TO COUNT AS LOADING /
DISCHARDING TIME or AS If the main reason why NOR can not be given is that there is no loading/discharging

LAYTIME berth available to the ship the laytime will commence to run when the ship starts to wait
for a berth and will continue to run, unless previously exhausted, until the ship stops
waiting. The laytime exceptions apply to the waiting time as if the ship were at the
loading/discharging berth provided the ship is not already on demurrage. When the
waiting time ends time commences to count and restarts when the ship reaches the
loading/discharging berth subject to say notice time if provided for in the C/P, unless the
ship is by then on demurrage.

TIME SHEET In order to calculate the time used for loading or discharging a time sheet is drawn up
from the statement of facts to determine if any demurrage/dispatch in payable.

TON PER INCH / CENTIMETRE The weight which must be added to, or taken from, a ship in order to change its mean
draft by one inch or one centimeter.

TONNAGE Gross Tonnage - Total internal carrying capacity of a vessel expressed in measurement
tons (one measurement ton = 100 cu. ft.).

TOTAL COMMISSION Total of (a) address commission [adcom] to charterer plus (b) brokerage to shipbroker.

TRADING LIMITS Limits or restrictions imposed by the shipowner on a time charterer’s freedom to
nominate ports to ensure that a list of places considered unsafe is excluded. Usually
followed by the words “within Institute Warranty Limits”.

TRANSIT SHIPMENT A term designating a shipment destined for an interior point or a place best reached by
reshipment from another port.

TRANSSHIPMENT To transfer from one ship or conveyance to another for further transit.

TRIMMING The operation of shoveling grain, coal and other bulk cargoes to the wings or ends of the
holds when loading.

TRIP-TIME CHARTER A vessel chartered on time charter terms but for a specific voyage and expected
duration. The charterer pays hire instead of freight and the contract is that of a time
charter.

TURN ROUND TIME Time taken to discharge and/or load a ship at a terminal.

ULLAGE Historically quantity a cask or drum lacks of being full. Nowdays the term is used for
tankers or oil storing tanks representing empty spaces.

ULTRA LARGE CRUDE CARRIERS Tankers above 320,000 tonnes dwt.

UNLESS SOONER COMMENCED Time actually used before commencement of laytime shall count.

UNLESS USED This refers to the counting of laytime and exceptions to laytime such as Sundays and
holidays. If work is carried out during the expected days the actual hours of work only to
count as laytime.

VALUATION CLAUSE The clause in the Marine Policy that contains a fixed basis of valuation agreed upon by
the Assured and the Underwriter and which establishes the insured value of the
merchandise. The Clause determines the amount payable under any recoverable loss or
 General Average contribution.

VERY LARGE CRUDE CARRIERS Tankers in the range of 160,000 to 319,000 dwt.

VESSEL Every description of watercraft or other artificial contrivance used, or capable of being
used, as a means of transportation on water.

VOYAGE CHARTER Employment of a vessel for a specific and certain voyage to load at one or more named
ports to be carried to a named discharging port or ports. The owner’s remuneration is
known as freight calculated on the amount of cargo carried. Voyage C/P contains laytime
and demurrage/dispatch clauses.

WAR RISKS Those risks related to two (or more) belligerents engaging in hostilities, whether or not
there has been a formal declaration of war. Such risks are excluded by the F.C.&S. (Free
of Capture and Seizure) Warranty, but may be covered by a separate War Risk Policy, at
an additional premium.

WAREHOUSE RECEIPT A receipt supplied by a warehouseman for goods he has placed in storage.

WAREHOUSE-TO-WAREHOUSE The clause in the Cargo Policy that defines when coverage commences and terminates. It
CLAUSE is the intent of the policy to attach at the time the goods leave the warehouse of origin
named in the Policy, and to continue while the goods are in due course of transit until
delivered to the warehouse of destination named in the Policy, where it terminates.

WEATHER PERMITTING That time during which weather prevents working shall not count as lay time.

WEATHER WORKING DAY

A working day or part of a working day during which it is possible (if the vessel is loading
/ discharging) to load of discharge the cargo without interference due to weather. If such
interference occurs (or would have occurred if work had been in progress) there shall be
excluded from laytime a period calculated by reference to the ratio which the duration of
the interference bears to the time which would have or could have been worked but for
the interference.

WHARFAGE A charge assessed by a pier or dock owner for handling incoming or outgoing cargo.

WHETHER IN BERTH OR NOT or If the location named for loading/discharging is a berth and if the berth is not
BERTH NO BERTH immediately accessible to the ship NOR can be given when the ship has arrived at the
port in which the berth is situated.

WHETHER IN FREE PRATIQUE OR With the insertion of this phrase, NOR can be tendered even if the health clearance
NOT formalities are not completed.

WHETHER IN PORT OR NOT The vessel need not exactly be within the port limits for NOR to be tendered. If is
possible to do this if the vessel has arrived at the usual waiting place for the vessel to
become an arrived ship.

WITH OUT GUARANTEE By the use of this phrase the shipowner is not bound by the veracity of the statement.
The phrase is commonly used during negotiations in order to guard all parties involved in
the transactions.

WORKING DAY Day or parts of a day which are not expressly excluded from laytime by the C/P and
which are not holidays.
WORLDSCALE Scale by which tanker freight rates are quoted.