Terminal Handling Charge - THC
This term is used in containerized seafreight to describe the charges raised by the Port of Arrival or Discharge to lift the container onto or off the vessel.
The cost normally embraces movement within the harbor to get the container to or from the 'stack'. The 'stack' is literally the place where the containers are stacked during their period in the harbor and it is common for different vessels to involve different stacks. In a groupage (consolidation) shipment, cost will also include unloading of the cargo from container and discharging in a warehouse.

It is not common for the THC at origin or destination to be included in the actual ocean freight charges, although it might be possible to arrange this. The reason for this is that Ocean Freight is generally charged out in US $ whereas the THC would be cost incurred in a local currency - which may be weaker than the dollar. To pay the THC as part of the freight could, therefore, actually increase the cost of that event.

THC is also sometimes referred to as FIO: Free In & Free Out. While not the same, FIO refers only to the unloading of the container from vessel to the stack or vice versa.

This is a trade term used by sellers and buyers to qualify the contract between them. INCOTERMS 2000 is the latest version of the International Chamber of Commerce's definitions of such trade terms. While not a law, the INCOTERM definitions are used worldwide and bring certainty to the detail of the contract.

FOB (Free On Board) is one of the common trade terms in use. Yet this 'common' aspect of the term has resulted in the vast array of definitions found all over the world for FOB. Some of these various terms directly contradict others, and many are supported by domestic legislation making such definitions unique to a specific country or to a specific port.

In defining FOB as an INCOTERM, it is expressed as being Monomodal and it can only be used for transactions where seafreight is the main carriage. Under INCOTERMS 2000, risk and responsibility pass from the Seller to the Buyer when the goods cross the (named or unnamed) ship's rail at the (named) port of loading, cleared for export by the Seller. Note also that costs pass at this same nominal mid-point, which clearly cr eates a problem in calculating such a division.

For FOB to apply, the Seller must be in the physical position of being able to load the cargo to (and thereafter across) the rail under their own direct control. This would involve the Seller's own labor, or an agent that is under the contractual control of the Seller. Further this process would have to be monitored by both the Seller and Buyer or their representatives. Generally, from a modern perspective, this control often cannot be achieved as the Seller is either not allowed into the harbor area or, even in those extreme circumstances where they are, they have no influence over the party loading the vessel. The INCOTERM FOB still has an application in some markets, but these are more and more in the minority. Note that the use of an 'on-board' Bill of Lading or mate's receipt could be appropriate in recording the passage of risks under FOB making FOB one of the few terms still unavoidably dependant on such documents.

Twenty-foot Equivalent Unit & Forty-foot Equivalent Unit.
Both of these expressions are used in sea freight Containerized trades. The expression 'TEU' is used when describing the length of a container - it means 'twenty-foot equivalent unit' the reference is to the length of a standard 20ft ISO container.

The ISO (international standards organization) who first determined the standard dimensions for containers is based in New York. Consequently, the standard sizes that they settled on are all given in 'imperial' measurements and not metric ones. Note then that a 'twenty-foot' container is often incorrectly given it's nearest metric length of 6 meters (The true metric length of a 20 foot container being slightly more than this).

So, a standard length 20ft or 6m container is one teu (it is equal to one twenty-foot length). Using the same formula then, a 12m or forty-foot container is equal to two teu's. This is sometimes expressed 'feu' (meaning forty-foot equivalent unit).One hundred 40ft container are equal to 200 TEU's

The use of the expression is often seen in Rail freight when a container carrying train is referred to as been a '100 teu' carrier. This means 100 x 20ft containers or 50 x 40ft containers or (more importantly) any combination thereof.

There have been some developments in the use of a longer ISO design - the 50ft container. Should this variation be used, it would become equal to 2.5 teus.

Twenty-foot Equivalent Unit TEU & Forty-foot Equivalent Unit FEU.
Both of these expressions are used in sea freight Containerized trades. The expression 'TEU' is used when describing the length of a container - it means 'twenty-foot equivalent unit' the reference is to the length of a standard 20ft ISO container.

The ISO (international standards organization) who first determined the standard dimensions for containers is based in New York. Consequently, the standard sizes that they settled on are all given in 'imperial' measurements and not metric ones. Note then that a 'twenty-foot' container is often incorrectly given it's nearest metric length of 6 meters (The true metric length of a 20 foot container being slightly more than this).

So, a standard length 20ft or 6m container is one teu (it is equal to one twenty-foot length). Using the same formula then, a 12m or forty-foot container is equal to two teu's. This is sometimes expressed 'feu' (meaning forty-foot equivalent unit). One hundred 40ft container are equal to 200 TEU's

The use of the expression is often seen in Rail freight when a container carrying train is referred to as been a '100 teu' carrier. This means 100 x 20ft containers or 50 x 40ft containers or (more importantly) any combination thereof.

There have been some developments in the use of a longer ISO design - the 50ft container. Should this variation be used, it would become equal to 2.5 teus.

Free In & Free Out also refered as Terminal Handling Charge - THC
This term is used in containerized seafreight to describe the charges raised by the Port of Arrival or Discharge to lift the container onto or off the vessel.

The cost normally embraces movement within the harbor to get the container to or from the 'stack'. The 'stack' is literally the place where the containers are stacked during their period in the harbor and it is common for different vessels to involve different stacks. In a groupage (consolidation) shipment, cost will also include unloading of the cargo from container and discharging in a warehouse.

It is not common for the THC at origin or destination to be included in the actual ocean freight charges, although it might be possible to arrange this. The reason for this is that Ocean Freight is generally charged out in US $ whereas the THC would be cost incurred in a local currency - which may be weaker than the dollar. To pay the THC as part of the freight could, therefore, actually increase the cost of that event.

THC is also sometimes referred to as FIO: Free In & Free Out. While not the same, FIO refers only to the unloading of the container from vessel to the stack or vice versa.

Pre (or Post) - Shipment Inspection
A Pre-Shipment inspection involves the inspection of cargo prior to loading or shipment by either an independent third party or by a representative of the buyer. The inspection is called for to assess the quantity, quality, composition or condition (or all of these) of the cargo.

ssentially, there are two types of inspection. An Inspection that is commercial in nature - this is to say that the buyer or buyer and seller have agreed to the inspection - or one that is mandated by law. When the inspection is legislated, it is normally a requirement of the government of the destination country. They will normally appoint an independent inspection service to act on their behalf in the various countries of origin and frequently, the clean report issued by the inspection service (or a certificate that the clean report has been issued) is the 'trigger' for payment. As such, the buyer cannot remit funds to the seller unless the cargo has passed the inspection. The extent of the inspection may be fixed and quite specific, dependant on the nature of the goods. Equally, the goods and circumstances dictate where and when such inspections take place. They can range in extent from a simple 'tally' e.g. counting boxes and opening a random sample of these, right up to drawing samples and subjecting them to chemical analysis in a laboratory.

With a 'commercial'inspection, the buyer normally appoints someone to be present at the loading, again checking quantities and random samples. This may be someone from the independent inspectorate field, or their own local agent etc. There are no guidelines for these informal commercial inspections but a common application is to endeavor to check that the quality of goods ordered on the strength of a high-grade sample meet the standards of the sample goods.

Even though Cargomaster (or the forwarder) does not make inspection itself, we can appoint and support you in this process. Some inspections inspection: SGS, Bureau Veritas.