ABAFT To the Top

Toward the rear of a ship.

AB KAL

In German, a term of sale signifying that the goods are sold free.

A-FIX-A

Brazilian form of the delayed price payment used in the United States. The farmer receives an advance on which interest is paid, until at a day of the farmer’s choosing, the final price of grain is set.

ABANDONMENT

(1) pertaining to marine insurance, the owner of a vessel claims constructive total loss arising from a maritime calamity, leaving the ship to the insurer for salvage value; (2) pertaining to domestic transportation, the refusal by a consignee to accept delivery of cargo, or the termination of service to a given route by the carrier.

ABANDONMENT CLAUSE

Term used in the marine insurance industry in which the clause gives an insured the right to abandon lost or damaged property and to claim full settlement form the insurer.

ABOUT

A term used in letter of credit practice which allows a 10% variance above or below the letter of credit value, or quantity of goods, or unit price of the goods.

ABSOLUTE ADVANTAGE

The ability of a country to supply a given product at an economic cost lower than that of a competing nation.

ABSOLUTE ENDORSEMENT

An obsolete term no longer used. It has been replaced by the term General Endorsement.

ABSOLUTE QUOTA

See quota

ABSOLUTE SPREAD

A provision in a variable rate loan that fixes the upper limit of the premium over prime rate at a specific percentage, e.g., prime plus 3 percent.

ABSORPTION

The assumption by one carrier of switching or other special charges of another generally without increasing the rate to the shipper.

A/C Abbreviation for the word “account”.

ACCELERATION CLAUSE

A clause in a promissory note shortening the time of payment of the note due to a breach of certain stipulated conditions.

ACCELERATED PAYMENT

According to 191.72 of Customs Regulations of the U.S., a drawback claimant not delinquent in customs payments is eligible for accelerated payment of properly completed drawback claims. The claimant must submit a request for accelerated payment to the Regional Commissioner of customs. If claim approved payment will be made within 3 weeks after filing.

ACCELERATED DISPOSITION

Accelerated disposition of a protest filed under 514, Tariff Act of 1930, for disputes in classifications, rate of duty, appraisement, exaction, exclusion of merchandise, liquidation refusal of drawback claims, or refusal to reliquidate an entry under section 520 (c) of the Tariff Act, may be obtained after 90 days from the filing of the protest. Accelerated disposition must be requested in writing. The district director of customs shall review the protest which is the subject of the request within 30 days of mailing. If the District Director fails to allow or deny a protest within the 30 day period, the protest is deemed denied at the close of the 30th day.

ACCELERATED STAGING

The Canadian - U.S. Free Trade Agreement eliminates all tariffs on goods of U.S. origin by 1998. These rate reductions began January 1, 1989. After that date, no existing tariffs may be increased unless specifically provided for elsewhere in the Agreement (for example, Chapter 11 of the Agreement provides for temporary emergency safeguards). Tariffs will be eliminated by January 1, 1998 on the basis of “Staging categories”. The staging category identifies whether a rate of duty is free effective January 1, 1989 or is reduced in five or ten stages. Article 401.5 of the Agreement introduces an element of flexibility by providing a tariff reduction accelerator clause. Contingent upon the mutual agreement of both governments, the provision allows individual businesses or industries on either side of the border to request that the duty on specific goods be reduced earlier than designated in the FTA. The Office of the U.S. Trade Representative will review all petitions received from interested parties. If agreement between the U.S. and Canada is reached regarding the product, the agreed upon accelerated tariff elimination schedule will become effective January 1 of the following year. Petitions should be forwarded with 10 copies to the Office of North American Affairs, Office of the U.S. Trade Representative, Room 501, 600 17th St., NW., Washington, D.C. 20506.

ACCEPTABILITY

Primarily a consideration of credit worthiness, it is one of two criteria for discount or re-discount of a negotiable instrument at the Federal Reserve.

ACCEPTANCE

Acceptance of a draft is indicated by the drawee by writing “accepted” across the face of the draft and by dating and signing it. Such acceptance legally binds the drawee to pay the face amount at maturity to the holder without qualifying conditions.

An agreement to purchase goods at a stated price and under specified terms. For banker’s acceptance, the drawee acts in receiving a draft and thus entering into the obligation to pay its value at maturity.

This term has several related meanings: (1) A time draft (or bill of exchange) that the drawee (the payer, who is paying from his or her account) has accepted and is unconditionally obligated to pay at maturity. The draft must be presented first for acceptance, the drawee becomes the “acceptor,” then for payment. The word “accepted” and the date and place of payment must be written on the face of the draft. (2) The drawee’s act in receiving a draft and thus entering into the obligation to pay its value at maturity. (3) Generally, any agreement to purchase goods under specified terms.

ACCEPTANCE AND RETURN

The returning of an accepted draft through the bank, to the maker to await maturity. Upon maturity, the holder of the draft would return it to the drawee and demand payment. It is better to avoid this process by leaving the acceptance at the bank that made the original presentation to the drawee; upon maturity, the bank will demand payment from the drawee and remit the proceeds to the owner of the draft.

ACCEPTANCE AGREEMENT

An agreement between a bank and a customer to provide clean bankers’ acceptance financing. The bank “accepts” a time draft drawn on it by a customer under the separate agreement.

ACCEPTANCE COMMISSION

The fee charged to the customer by the accepting bank as compensation for the credit risk involved in creating a Bankers’ Acceptance.

ACCEPTANCE CREDIT

A term used to specify a letter of credit that is payable to the beneficiary (seller of merchandise) on a time basis. Time drafts to be drawn on the issuer or on someone else will be required. Also referred to as “time credit” or “issuance credit.”

ACCEPTANCE FINANCING

An arrangement by which a bank extends to an exporter or importer a line of credit, known as the acceptance facility, to finance the purchase or sale of goods. The borrower draws against the line of credit by drawing drafts with future maturity dates, upon the bank; the bank will accept such drafts, up to the amount of the acceptance facility, with maturities thirty, sixty or ninety days hence. The bankers’ acceptance so created may be discounted, resulting in cash for the borrower. The bank, as collateral for the financing provided, may require that the borrower pledge bills of lading, or warehouse receipts, evidencing title to the goods that have been financed, or otherwise provide acceptable security. Borrowers of high standing may be extended clean, or unsecured, credit.

Acceptance financing can be arranged not only through banks but also through specialized financial firms known as acceptance houses.

ACCEPTANCE HOUSE

A financial institution that specializes in Acceptance Financing other than a bank.

ACCEPTANCE LIABILITY

The legal obligation assumed by a bank when accepting time drafts drawn upon it. See “Bankers’ Acceptance.”

ACCEPTANCE LINE (Facility) To the Top

The limit of money a bank is willing to finance a single customer utilizing Bankers’ Acceptance.

ACCEPTANCE SUPRA PROTEST

An agreement to pay a bill of exchange after it has been protested, to save the credit and honor of the drawer or endorser.

ACCEPTING BANK

A bank that accepts a time draft on it, thus creating a Bankers’ Acceptance.

ACCEPTING HOUSE

A non-bank financial institution that specializes in “acceptance financing.” Also, the term is used to indicate a member of the “London Accepting House Committee.”

ACCEPTOR

A person who accepts a time draft. By accepting the draft, the acceptor is primarily liable to pay the draft at maturity.

ACCESSORIAL CHARGES

Charges made for additional, special, or supplemental services, normally over and above the line haul services.

ACCESSORIAL SERVICE

A service rendered by a carrier in addition to transportation service, such as sorting, packing, pre-cooling, heating, storage, advancing payments to service providers, c.o.d. collections, etc.

ACCESSORIES

Customs definition according to the Harmonized Tariff System of the United States (1) They may facilitate use or handling; or (2) they may widen the range of uses of the main articles; or, (3) they may improve the operation of the main article; and (4) they are not needed to enable the goods, with which they are used, to fulfill their intended function and they are identifiable as being intended solely or principally for use with a specific article.

ACCOMMODATION BILL

A bill of exchange or similar instrument to which a credit-worthy party has added its endorsement, usually to enhance the value of the bill as a money market instrument.

ACCOMMODATION BILL OF LADING

A bill of lading issued by a carrier or its agent to a shipper in advance of actual receipt of the goods for carriage, thus allowing the shipper to draw on an expiring letter of credit, or to book a sale during a particular accounting period.

ACCOMMODATION DRAFT

A draft to which a credit-worthy party has added its endorsement.

ACCOMMODATION ENDORSEMENT

The endorsement of a draft or other negotiable instrument by a credit-worthy party in order to enhance the instrument’s acceptability in the money market. Commonly used in banking whereby one bank endorses another bank’s acceptance, so that the draft can be sold in Bankers’ Acceptance market.

ACCOMMODATION LINE

The acceptance by an insurance company of substandard risks as an accommodation to a particular broker who has previously provided, and is expected to continue to provide, attractive underwriting business.

ACCOMMODATION PARTY

One who provided an “accommodation endorsement” and thus assumes responsibility for payment if the drawee or prior endorsers default.

ACCOMMODATION PAPER

A negotiable instrument that is signed on the back by one party to induce a lender to grant credit or give money to another party.

ACCOUNT

A contractual relationship between a seller and buyer under which payment is made at a later time.

ACCOUNTEE

A letter of credit term sometimes used to designate the account party.

ACCOUNT PARTY

The party who applies to the opening bank for the issuance of a letter of credit.

ACCRUED INTEREST

Interest that has been earned but not paid.

ACQUITTANCE

A instrument releasing a party from debt or other obligation.

ACKNOWLEDGEMENT

In cargo insurance, this is a form used to acknowledge that insurance is in effect even though the issuer may not have details of the actual coverage provided by the policy.

ACKNOWLEDGEMENT CREDIT

A procedure whereby a Bank acts as a clearinghouse for a letter of credit transaction between two local banks who do not have correspondent relationships with one another. The draft is drawn on a clearinghouse bank.

ACP COUNTRIES

An acronym for African-Caribbean-Pacific countries. The term originated in conjunction with LOME CONVENTIONS.

ACS

The Automated Commercial Systems. Refers to Customs integrated comprehensive tracking system for the acquisition, processing and distribution of import data.

ACT OF GOD

An act beyond man’s control such as lightning, flood, earthquake. The carrier is not legally responsible under most circumstances for damage incurred from Acts of God.

ACT OF STATE DOCTRINE

A principle of international law that holds that the actions of a state, performed within its own boundaries are not subject to legal review in other countries. Some limitations were placed on this doctrine and was further expanded by the Foreign Sovereign Immunities Act.

ACTUAL OWNER To the Top

The party having legal title to a vessel, according to the ship’s registry papers.

ACTUAL TOTAL LOSS

In marine insurance, a loss where nothing remains of the insured merchandise or where the merchandise is so badly damaged that it is unsalvageable.

ACTUAL USE (Harmonized System)

When the tariff classification of any article is controlled by its actual use in the U.S., three conditions must be met in order to qualify for free entry or a lower rate of duty unless the language of the particular item of the Harmonized System of the United States applicable to merchandise specifies other condition. The conditions are that:

(a) Such use is intended at the time of importation.

(b) The article is so used.

(c) Proof of use is furnished within 3 years after the date the article is entered or withdrawn from warehouse for consumption.

ACTUAL VALUE RATE

A rate or rating that applies on actual value of articles as provided.

ACTUAL WEIGHT

The weight of the shipment as contrasted to billed weight.

ADJUSTED C.I.F. PRICE

A consideration in determining the variable import levy imposed by the European Economic Community on grain imports.

ADD-ON

A term equivalent to proportional, arbitrary or construction rate.

ADJUSTMENT ASSISTANCE

Financial, training and re-employment technical assistance to workers and technical assistance to firms and industries to help them cope with adjustment difficulties arising from increased import competition.

ADMISSION OF SEAWORTHINESS

A clause commonly found in contracts of marine insurance whereby the insurer agrees not to raise unseaworthiness of the vessel as a defense in claim brought by the policyholder.

ADMIRALTY COURT

A Court having jurisdiction over cases of action occurring in connection with contracts to transport by water, also other marine matters.

ADOPTION NOTICE

A notice required to be filed with the I.C.C. by a carrier or person taking over operating control of another carrier.

AD VALOREM (According to value)

A term usually applied to a customs duty charged upon the value only of goods that are dutiable, irrespective of quality, weight, or other considerations. The Ad Valorem rates of duty are expressed in percentages of the value of goods, usually ascertained from the invoice.

ADVANCE

A loan

ADVANCE ARRANGEMENT

An Air Traffic term meaning the shipper or his agent must contact the carrier prior to tendering the consignment.

ADVANCE AGAINST DOCUMENTS

A loan made on the security of the documents covering the shipment.

ADVANCED CHARGE

An Air Traffic term denoting a charge paid by a carrier to an agent or to another carrier, which the delivering carrier then collects from the consignee. Such charges are usually for agents’ forwarding fees and incidental expenses paid out of pocket for account of the shipment by an agent or other carrier.

ADVANCE FREIGHT

Commonly known as “Freight prepaid.” Freight paid by the shipper when merchandise is accepted for shipment.

ADVANCE PAYMENT

When a foreign customer pays a U.S company prior to receiving the goods.

ADVANCE PAYMENT BOND

A supplier who received advance payments or progress payments under a contract will often be required by the buyer to post an advance payment bond. The advance payment bond represents the issuing bank’s undertaking to return up to 100% of the advance payment to the buyer, upon the beneficiary’s presentation of documents as specified in the letter of credit.

ADVICE

A letter of credit transaction referring to the written notification of the letter of credit terms and conditions. This notification is addressed to the beneficiary (seller) by an advising bank.

ADVICE OF ACCEPTANCE

The notification given by a “collecting bank, addressed to the “remitting bank,” indicating that a draft has been accepted and giving its maturity date.

ADVICE OF FATE

The notification given by a “collecting bank,” addressed to the “remitting bank,” indicating the final outcome of an individual documentary collection.

ADVICE OF NON-PAYMENT/NON-ACCEPTANCE

The notification given by a “collecting bank,” addressed to the “remitting bank,” detailing the reasons for non-payment or non-acceptance of a draft under an individual documentary collection.

ADVISED CREDIT

A letter of credit which has been communicated to the beneficiary (seller) by the advising bank, without any obligation on the part of the advising bank.

ADVISED LINE OF CREDIT

Notification given by a bank to customer indicating the terms and conditions of a credit facility.

ADVISING BANK

The bank which notifies the seller that a letter of credit has been opened for a specified transaction and which forwards the documents submitted by the seller to the opening bank for payment.

ADVISORY CAPACITY To the Top

A term used when the powers of a shipper’s agent or representative abroad are limited and he is not authorized to make definite decision and adjustment without reference to his principle.

AFFIDAVIT

A written, sworn statement made before a “notary public” or other person who is legally authorized to attest the statement.

AFFREIGHTMENT (Contract of)

An agreement between steamship line (or similar carrier) and an importer or exporter in which cargo space is reserved on a vessel for specified time and at a specified price. The importer/exporter is obligated to make payment whether or not the shipment is made.

AFFIDAVIT

A written statement sworn to before a Notary Public

AFRICAN DEVELOPMENT BANK GROUP

A multilateral development organization. The first component of which the African Development Bank was created in 1963 under the auspices of the United Nations Economic Commission for Africa. The group provides funding to African states and multinational official bodies in Africa to advance industrial, agricultural, and infrastructure development.

AFT

Direction toward the stern of vessel.

AFTER DATE

When a draft bears this phrase, maturity is determined from the date of the draft. The date of maturity is, therefore, fixed.

AFTER SIGHT

A phrase indicating that payment on a draft or other negotiable instrument is due a specified number of days after presentation of the draft to the drawee or payee (rather than the date of the date).

AGENCY FEE

A charge imposed by a ship owner’s local agent for services on behalf of a vessel while the ship is in port; also, the commission paid by a vessel’s owner to local sales agents on cargo shipped on the vessel.

AGENCY TARIFF

A scale of rates or charges issued by a publishing agent for one or more transportation lines.

AGENT

An individual who has knowledge of facts authorized under a proper power of attorney to act on behalf of another person or company.

AGENT (Import) Authorized agent has knowledge of the facts. When entry is made in a consignee’s name by an agent who has knowledge of the facts and who is authorized under a proper power of attorney by that consignee to make declarations in accordance with Section 485(f),Tariff Act, as amended, a declaration on the entry or entry summary executed by that agent is sufficient and no bond to produce a declaration of the consignee is required.

AGENT BANK

The bank which is acting on instructions of another bank to collect money, usually by means of a draft.

AGENTED LETTER OF CREDIT

A letter of credit transaction whereby a group of banks participates in issuing a letter of credit. One bank (Agent Bank) from the group will be nominated to deal with beneficiary of the credit.

AGGREGATED SHIPMENTS

Numerous shipments from different shippers to one consignee that are consolidated and treated as a single consignment.

AGGREGATE OF THE INTERMEDIARIES RULE

A provision of the Interstate Commerce Act which states that in those cases where a combination of rates among intermediary points along the route would result in a freight charge lower than the through rate, a shipper may use the lower aggregated rate. This rule applies to rail and water carriers, subject to the act, but not to motor carriers or freight forwarders.

AGIO

Rarely used term referring to draft payable in a currency other than U.S. dollars. The term would indicate a premium was or is to be paid for exchanging the foreign currency into U.S. dollars.

AGREED VALUATION

The value of a shipment agreed upon in order to secure specific rating and/or liability.

AGREEMENT CORPORATION

An international banking corporation regulated in its activities by the Federal Reserve and chartered by state banking authorities.

AGRICULTURAL INFORMATION AND MARKETING SERVICES (AIMS)

This program of the Federal Agricultural Service (FAS) is designed to assist small and minority owned agricultural related business in exporting agricultural commodities. The purpose of the program is to provide a mechanism by which small and minority businesses can participate in international trade and FAS assistance and share in the economic success that large agricultural related firms enjoy.

AGRICULTURAL PAPER

Bills of exchange, drafts, and like instruments that arise from transactions in agricultural commodities. Agricultural paper with maturities of nine months or less may be discounted at regional Federal Reserve banks, subject to eligibility requirements contained in Federal Reserve Regulation.

AGRICULTURAL TRADE DEVELOPMENT AND ASSISTANCE ACT

Known commonly as P.L. 480, a 1954 act of Congress directed at the long-term improvement of the economics of developing nations through the concessional sale or grant of American agricultural products. The act is implemented by the Foreign Agricultural Service of the U.S. Department of Agriculture through several programs.

AID

Administers economic assistance programs for the federal government in more than 60 developing countries worldwide. The programs are designed to encourage economic development in recipient countries through purchase of U.S. goods and services with AID assistance funds.

AII

U.S. Customs Automated Invoice Interface, a method of transmitting detailed invoice data through ABI.

AIR CARGO To the Top

Air cargo movements include all commercial and governmental shipments between the United States and Foreign Countries. Shipments to and between United States possessions and to United States Armed Forced and Diplomatic missions abroad are excluded. The United States points of entry and exit are based on United States Department of Commerce Customs Districts.

AIRCARGO AGENT

An agent appointed by an airline to solicit and process international airfreight shipment.

AIR WAYBILL

A bill of lading which covers both domestic and international flights transporting goods to a specified destination. Technically, it is a non-negotiable contract of carriage for air transportation between an air carrier and a shipper.

AIR WAYBILL NEUTRAL

A standard AWB without identification of issuing carrier in any form.

AITA

Abbreviation for International Air Transport Association, IATA, (French, German).

ALIGNED EXPORT DOCUMENTATION SYSTEM

Method whereby as much information as possible is entered on a “master” document so that all or part of this information can be reproduced mechanically/electronically on individual forms of a similar design.

ALL-IN-RATE

When used in the shipping industry, all-in means inclusive of all freight charges. When used in trade finance it indicates a bank’s all-inclusive discount rate applied to a bankers’ acceptance.

ALL RAIL

Entirely by rail transportation.

ALLONGE

A paper which is firmly attached to a draft or other negotiable instrument for the purpose of endorsement, when there is no room available on the original instrument.

ALL-RISK CLAUSE

An insurance provision which provides that the insurer will be liable to the policyholder for all risks of loss or damage attributable to external forces, other than perils expressly omitted.

ALL TOLD

The entire deadweight capacity of a vessel.

ALL WATER SERVICE

This service does not include any overland transport. It is a service where merchandise is transported from port to port by ocean vessel only.

ALONGSIDE

A phrase referring to the side of ship. Goods to be delivered “alongside” are to be placed on the dock or barge within reach of the transport ship’s tackle so that they can be loaded aboard the ship.

ALTERED DRAFT

A draft containing a change in the amount, date, payee, or some other material alteration.

AMENDMENT

The process and document used in changing particular terms or condition in a letter of credit.

AMERCEMENT

To punish usually by a fine and imposed arbitrarily by a court.

AMERICAN ASSOCIATION OF EXPORTERS AND IMPORTERS (AAEI)

The AAEI with over 1200 U.S. member firms, is known for its technical expertise on a wide range of trade matters. Products of AAEI members cover a broad range of industries including; chemicals, machinery, electronic, textiles and apparel, footwear, food, automobiles, wines and specialty items. In addition, many organizations serving the trade community, custom brokers, freight forwarder, trading companies, banks, attorneys and insurance firms, are active members.

AMERICAN BUREAU OF SHIPPING (ABS)

A non-profit corporation founded in 1862 for the purpose of certifying the soundness and seaworthiness of vessels and other maritime engineering structures. The ABS, along with other recognized classification societies, establishes vessel standard and classifies individual vessels within each class. This system of vessel classification is essential to the marine insurance industry.

AMERICAN COMPONENTS ASSEMBLED ABROAD

The meaning on this term as found in the Harmonized Tariff Schedules of the United States, item number 9802.00.00, applies to imported merchandise which was assembled abroad from components produced in the United States and eligible for relief from duties on the value of the American components.

AMERICAN GOOD RETURNED (AGR)

A provision contained in part 10.1 of the Customs Regulations of the United States that permits duty-free return of merchandise of American manufactured products. The goods must not have been manipulated or advanced in value. This provision does not apply if claim for drawback was made at time of export.

AMERICAN FISHERY

Within the meaning of Section XV, Chapter 98, Harmonized Tariff Schedule of the United States is defined as a fishing enterprise conducted under the American flag by vessels of the U.S. on the high seas or in foreign waters in which such vessels have the right by treaty or otherwise, to take fish or other marine products and may include a shore station operated in conjunction with such vessels by the owner or master thereof. (No entry or free entry if processed at sea)

AMERICAN MADE

The term “American-made” is used to refer to a product of the United States. See Product of the United States.

AMERICAN SELLING PRICE

Under the ASP scheme, an imported product’s value for duty was based upon the selling price of like products manufactured in the United States, irrespective of the price the importer actually paid.

AMIDSHIPS

Halfway between the bow and stern of a ship.

ANDEAN GROUP

Also Andean Common Market. A subgroup of Latin American Free Trade Association, which aims to accelerate the harmonious development of member states through economic and social integration.

ANTEDATE To the Top

The dating of a draft earlier than the date on which the drawer signs and completes the draft.

ANTICIPATED ACCEPTANCE

The payment of an acceptance before its maturity date.

ANTICIPATORY DRAWING

A letter of credit transaction, specifically “ red clause” type, where a beneficiary is allowed to receive money on the credit before presenting shipping documents. The term also includes immediate reimbursement to the bank which paid the beneficiary.

ANTI-DUMPING DUTIES:

A tariff imposed to discourage sale of foreign goods in the U.S which are being sold less expensively in the U.S. than in the home market.

ANY QUANTITY (A.Q.) (AQ)

Usually refers to a rating that applies to an article regardless of weight (i.e., in any quantity).

APPARENT GOOD ORDER

Statement denoting that goods are free from damage and in good condition, as far as their external appearance is concerned.

APPLICANT

The party who applies to the opening bank for the issuance of a letter of credit.

APPLICATION

The form is executed by the applicant of a letter of credit instructing the opening bank of the terms and conditions that should be incorporated in the letter of credit.

APPRAISER’S STORES

Government-owned warehouse, where examiners (appraisers) inspect and survey designated goods imported from abroad.

APPROVAL BASIS

A letter of credit term used for forwarding discrepant documents to the opening bank. The action is authorized by the beneficiary for the express purpose of seeking the applicant’s waiver and subsequent payment.

APPRAISEMENT

The determination, by an officer of Customs, of the dutiable value of imported merchandise.

ARAB BOYCOTT

An economic boycott of Israel proclaimed in December 1945 by the Arab League to hamper “Jewish industry in Palestine.” The boycott included any company, product or service having ties with Israel. In 1965 part 369 of the Export Control Regulations was invoked requiring U.S. Exporters to report to the Secretary of Commerce any requests from foreign customer to comply with any foreign boycott. In 1983, 37.500 boycott request were reported to the Department of Commerce by U.S. firms.

ARAB LEAGUE

An association of independent Arab states formed in 1945 for the purpose of advancing cooperation among the members in political, economic, and social matters.

ARBITRAGE

The process of buying Foreign exchange, stocks, bonds, and other commodities in one market and immediately selling them in another market at a higher price.

ARBITRARY

1) A fixed amount which a transportation line agrees to accept in dividing joint rate. 2) A fixed amount added to or deducted from one station to make a rate from another station.

ARBITRATION CLAUSE

A standard clause to be included in the contracts of exporters and importer, as suggested by the American Arbitration Association. It states that any controversy or claim will be settled by arbitration in accordance with the rules of the American Arbitration Association.

ARREST

The restraint of a vessel by legal authority pending settlement of an admiralty suite. An arrest in maritime usage is the approximate equivalent of an attachment.

ARRIVAL DRAFT

Document collection transactions indicating a sight draft payable when the carrying vessel arrive. This type of draft if non-negotiable.

ARRIVAL NOTICE

A notice from the ocean carrier to the “notify party,” indicating the vessel’s estimated arrival date; identifying shipment details such as number of packages, weight, and container number; and indicating when free time expires. Often includes a freight invoice.

ASIAN DOLLARS

U.S. dollars deposited in Asia and Pacific Basin. Compare Eurodollars.

AS PER ADVICE

A notation on some bills of exchange and drafts indicating that the drawee has been informed that the bill is to be presented.

ASSEMBLY

In custom usage, the fitting or joining together of fabricated components

ASSEMBLY SERVICE

A service provided by some common carriers whereby small lots of cargo bound for a single consignee are shipped to carrier’s terminal to be consolidated into a single shipment.

ASSIGN

To transfer or endorse over to another party.

ASSIGNEE

One to whom a right or property is transferred.

ASSIGNMENT To the Top

A term commonly used in connection with a Bill of Lading which involves transfer of rights, title and interest for the purpose of assigning goods by endorsement of the Bill of Lading.

ASSIGNOR

One by whom a right or property is transferred.

ASSISTS (Import)

Any of the following if supplied directly or indirectly, and free of charge or at a reduced cost by the buyer of imported merchandise for use in connection with production or the sale for export to the U.S. of the merchandise.

1. materials, components, parts, and similar items incorporated in the imported merchandise.

2. tools, dies, molds, and similar items used in the production of the imported merchandise.

3. merchandise consumed in the production of the imported merchandise.

4. engineering, development, art work, design work, and plans and sketches that are undertaken elsewhere than in the United States and are necessary for the production of the imported merchandise.

ASSOCIATION OF SOUTHEAST ASIAN NATIONS (ASEAN)

A regional organization formed to accelerate economic development in Asia.

ATA CARNET-see Carnet

AT SIGHT

A phrase indicating that payment on a draft or other negotiable instrument is due upon presentation or demand.

AUDIO/VIDEO TELECONFERENCING

These methods of communication enable business executives to conduct worldwide meetings by utilizing a telephone or television screen.

AUTARCHY

A nation that is economically self sufficient. Efforts toward achieving a state of autarchy usually encompass significant governmental controls over the economy, especially in the areas of international trade and dealing in foreign exchange.

AUTHORITY TO PAY

A letter used mostly in the Far Eastern trade, addressed by a bank to a seller of merchandise, notifying him that it is authorized to purchase, with or without recourse, drafts up to a stipulated amount drawn on certain foreign buyer to cover a specified shipment of merchandise.

AUTHORITY TO PURCHASE

A conditional payment authorization issued by a bank in favor of a seller of merchandise. This instrument originated in the Far East and requires drafts to be drawn on the buyer, with or without recourse to the seller.

AUTHORIZED AGENT

A person expressly authorized by a principal to act on his behalf.

AUTOMATED BROKER INTERFACE (ABI)

Refers to a system available to brokers with the computer capabilities and customs certification to transmit and exchange customs entries and other information, facilitating prompt release of imported cargo.

AUTOMATED COMMERCIAL SYSTEM/ AUTOMATED MANIFEST SYSTEM (ACS/AMS)

U.S Customs programs to automate the flow of customs-related information among customs broker, importers, and carriers.

AVAL

A form of guarantee, generally by a foreign commercial bank, of an instrument. Usually, an aval is an unconditional guarantee of payment and is not affected by the terms of the underlying transaction. An aval is recognized only in certain countries.

AVERAGE

A marine insurance industry term indicating a loss or damage to merchandise shipped.

AVERAGE ADJUSTER

A marine insurance industry term referring to a person who is a specialist in the settlement of marine insurance claims.

AVERAGE DEMURRAGE AGREEMENT To the Top

An agreement made between a shipper and a transportation line whereby the shipper is debited for the time cars are held for loading or unloading beyond a certain period and credited for the time cars are released by him within a certain period, demurrage charges being assessed by the transportation line, usually at the end of the month, for any outstanding debits.