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NAROTTAM MORARJEE

INSTITUTE OF SHIPPING

MUMBAI

STUDY MATERIAL

SHIPPING PRACTICE

FIRST YEAR 2019

REGD. OFFICE
76, Jolly Maker Chambers No.2
Nariman Point, MUMBAI-400021 (INDIA)
Tele: +91-22-22024110 or +91-22-22022495
E-mail: admin@nmis.net
Website: www.nmis.net
 NAROTTAM MORARJEE INSTITUTE OF SHIPPING
MUMBAI
These study materials are strictly for private circulation among the bonafide students and members of the
Narottam Morarjee Institute of Shipping only. Any unauthorised use, copying or taking extract of these
materials, without the written permission of the Institute for any purpose other than the prosecution of
the Institute's courses are strictly forbidden.

CONTENTS/INDEX

SHIPPING PRACTICE
LESSON TOPIC TOTAL PAGE
NO. PAGES NO.
- INDEX 1 1
- SYLLABUS 2 2 -- 3
1 GENERAL PARTICULARS OF SHIPS 11 4 – 14
2 SURVEYS & CERTIFICATION 7 15 – 21
3 CLASSIFICATION SOCIETIES 7 22 – 28
4 LETTER OF CREDIT & INCOTERMS 10 29 – 38
5 BILL OF LADING 19 39 – 57
6 SHIPPING OPERATIONS 7 58 – 64
7 INTRODUCTION TO CHARTERING 8 65 – 72
8 PORT OPERATIONS 14 73 – 86
9 CARGO CARRIAGE & STOWAGE 7 87 – 93
10 CARGO HANDLING EQPTS USED ON BOARD & 21 94 – 114
ASHORE
11 INTERMEDIARIES IN SHIPPING 12 115 – 126
12 SHIPPING DOCUMENTS 18 127 – 144
13 PROCEDURE FOR ENTERING & LEAVING PORTS & 11 145 – 155
PORT SERVICES
14 BUSINESS COMMUNICATION IN SHIPPING 22 156 – 177
15 ABBREVIATIONS 12 178 – 189
16 BASIC SHIPPING TERMINOLOGY 48 190 – 237
17 3 MODEL TEST PAPERS (COLOUR PAGES) 3 238 – 240

ANNEX-1 SPECIALISED VESSELS & TYPES OF TANKERS 13 241 – 253

ANNEX-2 TYPES OF SHIPPING OPERATIONS 9 254 – 262
ANNEX-3 TYPES OF CHARTERPARTIES 10 263 – 272
ANNEX-4 CLEARING & FORWARDING OF CARGO 5 273 – 277
ANNEX-5 COASTAL SHIPPING IN INDIA 3 278 – 280
ANNEX-6 CABOTAGE 6 281 – 286
ANNEX-7 STATUTORY DOCUMENTS ON BOARD 15 287 – 301
ANNEX-8 CONTAINERIZATION 17 302 – 318
ANNEX-9 FREIGHT & FREIGHT UNITS 4 319 – 322
ANNEX-10 THE SHIP’S CREW 5 323 – 327
ANNEX-11 INWARD & OUTWARD CLEARANCE OF SHIPS 4 328 – 331
ANNEX-12 EXPORT & IMPORT PROCEDURES INCLUDING 9 332 – 340
DOCUMENTATION
ANNEX-13 ILLUSTRATIONS & SHIPS’ PROFILES/PLANS 25 341 – 365

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 NAROTTAM MORARJEE INSTITUTE OF SHIPPING
SHIPPING PRACTICE
Sr. SHIPPING PRACTICE -- SYLLABUS
No.
1. General Particulars : Hull, Machinery, Steering system, Cargo holds, various compartments &
superstructure, Equipment, Shipboard Measurements, Length, Width/Breadth, Depth, Draft, Freeboard,
Procedure for reading draft marks, Weight tonnage terms, Tanks, Types of Ballast conditions, Topside tanks,
Lower hopper tanks, Double bottom tanks, Fore & Aft peak ballast tanks, and Capacity Measurements on
ships.
2. Surveys & Certification: Flag state, Flag state certificate of registry, Flag of Convenience/Open Registries,
Objectives of Flag State Inspections, Inspection process, Scheduled flag state inspections, Un-scheduled flag
state inspections, Reporting, Verification & Monitoring, Role of Flag State, Changing the Flag State, Post
State Control, Statutory certificates,
3. Classification Societies -- background, their functions and importance, surveys & certificates, IRS, Dual
classification.
4. Letter of Credit: Introduction, Advantage to Exporter & Importer, INCOTERMS – Rules for any mode or
modes of transport, Rules for Sea & Inland Waterway transport, UPC 600.
5. Bills of Lading -- functions, conditions, contents, types and general information; Letter of Indemnity,
Multimodal transportation, Multimodal transport document.
6. Shipping Operations: Tramp Shipping (Voyage, Time, Demise/Bareboat), Characteristics of Tramp carrier,
Liner Shipping, Liner shipping efficiency, Liner Shipping broad categories; Marketing services of Liner
Shipping.
7. Introduction to Chartering: Chartering background, COA, Specific meaning of COA, Charterparty, Basic
classification of Ocean Traffic, Basic Qualification of Shipping Traffic, Types of charter party – Voyage,
Time, Bareboat, Tram shipping contracts & freight, Major elements which influence fixing of a freight rates,
BIMCO, Voyage charter party code forms, Time Charter party code forms.
8. Port Operations: Light House, Approach channel, Turning basin, Draft limitation, Pilotage, Tug boats,
Seagoing tugs, Harbour tugs, River tugs, Mooring operations, Ship to Ship transfer, Single buoy or single
point mooring, Conventional buoy or multi buoy mooring, Mediterranean mooring, Running mooring,
Standing mooring, Vessel traffic management system, Anchorage, Bunkering & Supplies,
9. Cargo carriage & Stowage: importance in the carriage of dry and liquid cargoes, effect of density of water
(fresh, salt, brackish). Factors that influence the stowage factors of the cargo, Broken stowage, Different
freight unit, Common stowage factors for various commodities, Dunnage, Density, Hydrometer.
10. Cargo handling equipments used on Board & Ashore: Concept of ‘Unit Load’, Strapping, Pre-slinging,
Pre-slinging materials, Handling, Palletization, Method of Securing, Handling & Stowage, Effect of the
Pallet, Barges, RO-RO ships, Advantages of RO-RO ships, Tankers – cargo operations, Bulkcarrier cargo
operations by Conveyors – Grabs – Loading art/chute – Excavators, Container terminals – RMQGC – Rubber
tyred gantry crane, Cargo handling eqpts at CY, CFS & ICD, Fort lifts, Mobile harbour crane, Cargo gear &
responsibilities of Owner, Register of ships cargo handling gear & applicances, Initial examination &
certification, Periodic examinations & retesting, International Cargo Handling Coordination Association.
11. Intermediaries in Shipping: Shipbroker (Shipowner’s broker, Charterer’s broker or Chartering agent,
Coasting broker, Exclusive broker, Competitive broker, Cable broker), Freight broker, Freight forwarder &
role, Multimodal Transport Operator, Sale & Purchase broker, Clearing & Forwarding/Custom House Agent,
Shipping Agent, Port Agent & Responsibilities, Liner Agents, Duties of the agent, E-Freight Platforms.
12. Shipping Documents: Proforma Invoice, Packing list, Certificate of origin, Shipping bill, Bill of Entry, Tally
sheets, Manifest, Mate’s receipt, Statement of Facts, Time-sheets, Notice of Readiness, Dangerous goods
manifest, Note of Protest & procedure for noting protests, Letter of Protest, Port Clearance,
13. Procedure for Entering & Leaving ports & Port Services: Introduction, Custom house work -- Inward and
outward entry of ships documentation. Ship’s papers; Ship’s Articles; Manifest; Official log; Procedure on
Arrival; Procedure for Leaving; Port procedure at Indian ports; Entry outward; Clearance of vessels; Ships
certificate of registry, Port information – Masters should seek, Official log book.
14. Business communication in shipping -- letter writing, telex, fax, e-mail, report-writing, memo-writing,
charts and graphs.
15. Shipping Abbreviations :
16. Basic Shipping Terminology:

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17. Annex-1 : Specialized vessels & Types of Tankers: Tween deckers; Shelter deck vessels, Refrigerated
ships; Bulk carriers; Lakers; Ore carriers, Loggers; Cement carriers; Lumber & Paper product carriers; The
container family; Barge carrying vessels; Ro-Ro; Combination carriers; Edible oil carriers; Classification of
tankers; Crude oil carriers; Product carriers; Chemical carriers (parcel tankers); Gas carriers; Juice tankers.
18. Annex-2 : Types of Shipping Operations: Classification of shipping operations, Evolution of the Tramp;
Evolution of the Liner, Highlights of Liner Shipping, Passenger service.
19. Annex-3 : Types of Charterparties : Demise or Bareboat charter; Non-demise charter (Voyage or Time);
types of charters -- time, trip-time, voyage, consecutive voyages, bareboat; contract of affreightment, features
of dry bulk and tanker chartering; names of different charterparty forms for different trades.
20. Annex-4 : Clearing & Forwarding of Cargo: Introduction, Chain of Delivery, Various stages, Role of
Freight forwarder on behalf of Consignor & on behalf of Consignee, for both if required, role with customs,
documents for clearance.
21. Annex-5 : Coastal Shipping in India: Problems faced by coastal shipping in India, Remedies, Future trends.
22. Annex-6 : Cabotage: Concept of cabotage, Cobotage in India, Sections of MSA 1958 regarding Cabotage.
23. Annex-7 : Statutory documents on board including mandatory surveys and safety certificates.
24. Annex-8 : Containerization: Definitions, Classification by size or dimensions/by use, Concept of FCL &
LCL, Freighting of containerized cargoes, CBR, FAK, Conventional tariff for LCL, Container markings,
Container Terminal, Stacking yard/container yard, CFS, Terminology, Types of containers, Factors to be
borne in mind for stowage inside containers, Advantages & Disadvantages of containerization,
25. Annex-9 : Freight & Freight Units: Definition of freight, Freight calculated on weight of cargo,
measurement of cargo or value, What are short tons, long tons & metric tons, factors of liner rates, Class &
commodity freight rates, Stoppage in transit.
26. Annex-10 : The Ship’s Crew: Shipboard Organization, Master duties, Chief officer (Mate), Deck staff,
Engine staff, Catering staff.
27. Annex-11 : Inward & Outward Clearance of Ships: Inward clearance; Outward clearance.
28. Annex-12 : Export & Import Procedures : Exports; Freight broker; Clearing & forwarding agents; Bill of
Lading; Imports, General Landing date, free days & demurrage; Claims, Shipping bill; Bill of Entry; Types of
Bill of Entry; When to present bill of entry; Salient features of the Bill of Entry; Documents furnished with
B.E; Presentation of B.L. and Noting thereof.
29. Annex-13 : Illustrations & Ships’ Profiles/Plans :

NOTE: A student should be able to draw an outline of the different types of ships and mark important features.

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SHIPPING PRACTICE FIRST YEAR

LESSON 1

GENERAL PARTICULARS

1.0 HULL:
1.1 This is the shell of the ship. The design of this shell will depend upon the type of ship and
its operation. The shipyard will arrange to design the shell depending upon the specifications given
by the shipowner. The ship side steel plates, which form the outer covering of the ship, are held
together by a series of transverse frames, spaced at regular p re-determined intervals from the fore
(front portion) to the aft (rear portion) of the vessel (ship).

1.2 The transverse frames are placed at right angles to the keel of the ship and are actually the
ribs that hold the shell together. The hull is further sub-divided into a number of watertight
compartments by bulkheads (steel walls). There are statutory regulations that determine the
number of water-tight bulkheads that a ship must have and are required to isolate various parts of
the ship during a fire or a collision. It is also obligatory to install a collision bulkhead (a specially
strengthened water-tight bulkhead) within the first 5% of the. length of the ship from forward.

1.3 The rear portion of the ship is called as the AFTER (AFT) end or STERN and the front portion
of the ship is called as the FORE end or FORWARD part (FWD). This is also referred as the BOW.

1.4 When the vessel moves with the bow first it is said to be moving forward and when it is moving with
the stern first it is said to be going astern.

2.0 MACHINERY:
2.1 In one portion of the hull, usually the aft part, is housed the main engine of the ship that actually
propels the ship. Also housed in this engine room are various auxiliary machinery like generators,
pumps for supply of hot and cold water, ballast pumps, engine cooling, pumps, refrigeration machinery,
boilers, etc. The funnel of the ship is usually above the engine room and is normally painted with the logo or
colours of the company to which the ship belongs. Modern ships are fitted with various equipments.
Nowadays many ships (cargo ships, passenger vessels, container ships, etc.) are fitted with transverse
propulsion units in the bows which are called BOW THRUSTERS and in the stern called as STERN
THRUSTERS. By fitting such transverse propulsion units, the maneuverability of the vessel increases to
a great extent.
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 BOW THRUSTER

STERN THRUSTERS

2.2 On modern passenger vessels, stabilizers (which look like the fins of a fish) are fitted on both
sides of the ship. When they are to be used they are extended out (under water) at right angles to the
ship side. The purpose of these stabilizers, are to reduce rolling at sea and make the voyage
comfortable for the passengers.

3.0 The other important part of the ship includes the following:

3.1 Steering systems: For ships with independent propulsion systems a steering system becomes
necessary. The most common is a rudder, a submerged plane located at the rear of the hull. Rudders
are rotated to generate a lateral force which turns the ship. Rudders can be rotated by a tiller, manual
wheels, or electro-hydraulic systems. Autopilot systems operated from the bridge send electric or
electro-hydraulic signals and the mechanical rudders are operated. Ducted propellers are sometimes
used for steering.

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3.2 Cargo Holds, Various Compartments, and the Superstructure:

3.2.1 Ships generally have multiple decks and compartments. Cargo ships typically have one or more
cargo holds. In ships carrying liquid cargo such as tankers, it is called as Cargo oil tanks. Most large
vessels have an engine room, a galley, and various compartments for work.

3.2.2 Tanks are used to store fuel, engine oil, and fresh water. Ballast tanks are equipped to change
a ship's trim and modify its stability.

3.2.3 Superstructures are found above the main deck. On modern cargo ships, they are almost
always located near the ship's stern. On Ultra large container ships these could be also located at 1/3
the LOA from forward for complying with regulations of the visibility. On passenger ships and warships,
the superstructure generally extends far forward. In the Ro-PAX vessels and some ferries the
accommodation block is in the forward part of the vessel. In Tankers and bulk carriers it is generally in
the after part of the ship. In tankers there is another specific compartment where the cargo oil pumps
are present. This is referred to as the cargo pump room. This pump room is generally just ahead of the
machinery space with a subdivision between the two spaces. Within the machinery space, there could
be subdivisions for the propeller shaft space and also the steering gear depending on the design of the
ship.

3.3 Equipment:

3.3.1 Shipboard equipment varies from ship to ship depending on such factors as the ship's era,
design, area of operation, and purpose. Some types of equipment that are widely found include:

3.3.2 Masts can be the home of antennas, navigation lights, radar transponders, fog signals, and
similar devices often required by law.

3.3.3 Ground tackle includes equipment such as mooring winches & Anchors. Anchors are used
to moor ships in shallow water. The chain of the anchor runs through a hawse pipe leading out of the
ship. It leads through the SPURLING pipe into the ship.

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3.3.4 The anchors are operated with the assistance of the mooring winches which are coupled with
the anchor handling winch. The space in which the entire chain of the anchor is stowed is called the
CHAIN LOCKER.

3.3.5 Cargo gear and equipment such as cranes and cargo booms are used to load and unload cargo
and ship's stores.

3.3.6 Safety equipment such as lifeboats, life-rafts, and survival suits are carried aboard vessels for
emergency use. On passenger ferry the number of safety equipments are relatively higher due to the
number of lives on board when compared to cargo ships.

4.0 Shipboard Measurements:

4.1 A ship's size and capacity can be described in two ways--linear dimensions or tonnages. Each
is completely different yet interrelated.

4.2 A ship's measurement is expressed in feet and inches--linear dimensions. A ship is a three
dimensional structure having length, width, and depth.

A Ship's Dimensions

4.3 LENGTH:

4.3.1 A ship's length is measured in different ways for ship's officers, for architects and designers,
and for registry. Terms used for technical or registry purposes include registered length, tonnage
length, floodable length, and length by CLASSIFICATION SOCIETY rules. We mention these terms for
familiarization only. The more commonly used length measurements:

 LENGTH OVERALL (LOA)

 LENGTH BETWEEN PERPENDICULARS (LBP)
 LENGTH ON LOAD WATERLINE (LWL)

4.3.2 A ship's Length Overall [LOA] is measured in feet and inches from the extreme forward end
of the bow to the extreme aft end of the stern. Watercraft operators must be familiar with this and
similar dimensions to safely maneuver the ship. The dimension is commonly found in lists of ship's
data for each vessel.

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4.3.3 A ship's length is sometimes given as Length Between Perpendiculars [LBP]. It is measured in
feet and inches from the forward surface of the stem, or main bow perpendicular member, to the
after surface of the sternpost, or main stern perpendicular member. This was believed to give a
reasonable idea of the ship's carrying capacity, as it excluded the small, often unusable volume
contained in her overhanging ends. On some types of vessels this is, for all practical purposes, a
waterline measurement.

4.3.4 A ship's Length on Load Waterline [LWL] is an important dimension because length at the
waterline is a key factor in the complex problem of speed, resistance, and friction. On vessels with a
counter stern, the LWL and LBP can be the same or about the same. On a ship with a cruiser stern,
the LWL is greater than the LBP, as shown in the top portion of Figure 3-6.

4.4 WIDTH/ BREADTH:

4.4.1 A ship's width or, more properly, a ship's breadth is expressed in a number of ways and, like
length, for a number of reasons.

4.4.2 A ship's extreme breadth, commonly called beam, is measured in feet and inches from the
most outboard point on one side to the most outboard point on the other at the widest point on the
ship. This dimension must include any projections on either side of the vessel. Like length overall, this
measurement is important to a ship's officer in handling the vessel.

4.5 DEPTH:

4.5.1 The depth of a vessel involves several very important vertical dimensions. They involve terms
like freeboard, draft, draft marks, and load lines. The vessel's depth is measured vertically from the
lowest point of the hull, ordinarily from the bottom of the keel, to the side of any deck that you may
choose as a reference point. Therefore, it has to be stated in specific terms such as depth to upper
deck amidships. It is impractical to measure depth in any other way, since it varies considerably from
one point to another on many ships. For example, the depth is greater at the stern than amidships.

4.5.2 The term "depth" is where the measurement is taken from the bottom--from the keel
upward. Ordinarily, if such a measurement were being made in a room of a building, taken from the
floor to the ceiling, it would be called height.

4.6 DRAFT (DRAUGHT):

4.6.1 The draft or draught of a ship's hull is the vertical distance between the waterline and the
bottom of the hull (keel), with the thickness of the hull included; in the case of not being included
the draft outline would be obtained. Draft determines the minimum depth of water
a ship or boat can safely navigate.

4.7 FREEBOARD:

4.7.1 The distance from the waterline to the upper deck level, measured at the lowest point
of sheer where water can enter the boat or ship. In commercial vessels, the latter criterion measured
relative to the ship's load line, regardless of deck arrangements, is the mandated and regulated
meaning.

5.0 PROCEDURE FOR READING DRAFT MARKS:

5.1 Draft marks are numbers marked on each side of the bow and stern of the vessel. Draft marks
show the distance from the bottom of the keel to the waterline.

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 Draft Marks on Bow and Stern of Vessel
5.2 The draft numbers shown in the figure are 6 inches high and 6 inches apart. The
bottom of each number shows the foot draft mark.

Draft Numbers Showing Foot Draft Mark

5.3 The next figure shows four different draft readings.

Various Draft Readings

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6.0 WEIGHT TONNAGE TERMS:

6.1 The word "ton" comes from the English "tun" meaning cask or barrel. To the English, it meant
a wine barrel with a capacity of about 252 gallons. When Parliament imposed duties on the wine
entering England in these barrels, the duty imposed on each tun eventually led to the use of tunnage
in describing a ship's capacity to carry such barrels. The original use of tun meant a barrel of a
particular size, the space that such a barrel would occupy, and a ship's capacity to carry a given
number of such barrels. Tun was originally a figure for space--not weight. By law, Parliament fixed the
tun at 252 gallons. Since this fixed tun weighed an average of 2,240 pounds, it brought into existence
the weight term "long ton."

6.2 A long ton is used throughout the shipping business. It is not to be confused with the familiar
ton of 2,000 pounds, the short ton, used so widely in the US in relation to so many things other than
ships and shipping. The metric ton is 1,000 kilograms, the equivalent of 2,204.6 pounds. Tonnages
normally refer to the long ton of 2,240 pounds.

6.3 DISPLACEMENT, LIGHT - The weight of the ship excluding cargo, fuel, ballast, stores,
passengers, crew, but with water in boilers to steaming level.

6.4 DISPLACEMENT, LOADED - The weight of the ship including cargo, passengers, fuel, water,
stores, dunnage and such other items necessary for use on a voyage, which brings the ship down to
her load draft.

6.5 DEADWEIGHT - The total lifting capacity of a ship expressed in tons of 2240 lbs. It is the
difference between the displacement light and the displacement loaded.

6.6 GROSS TONNAGE - The entire internal cubic capacity of the ship expressed in tons of 100
cubic feet to the ton, except certain spaces which are exempted, such as: (1) peak and other tanks
for water ballast; (2) spaces above the uppermost continuous deck, such as: open forecastle, bridge
and poop, certain light and air spaces, domes of skylights, condenser, anchor gear, steering gear,
wheel house, galley and cabins for passengers.

6.7 NET TONNAGE - The tonnage most frequently used for the calculation of tonnage taxes and
the assessment of charges for wharfage and other port dues. Net tonnage is obtained by deducting
from the gross tonnage, crew and navigating spaces and an allowance for the space occupied by the
propelling machinery.

6.8 CARGO DEADWEIGHT - Capacity is determined by deducting from total deadweight the
weight of fuel, water, stores, dunnage, crew passengers, and other items necessary for use on a
voyage.

7.0 TANKS:

7.1 BALLAST TANKS - A ballast tank is a compartment within a boat, ship or other floating structure
that holds water, which is used as ballast to provide stability for a vessel. Using water in a tank provides
easier weight adjustment than the stone or iron ballast used in older vessels. It also makes it easy for
the crew to reduce a vessel's draft when they enter shallower water, by temporarily pumping out
ballast.

7.2 To provide adequate stability to vessels at sea, ballast weighs the ship down and lowers its
centre of gravity. International agreements under the Safety of Life At Sea (SOLAS) Convention require

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that cargo vessels and passenger ships be constructed to withstand certain kinds of damage. The
criteria specify the separation of compartments within the vessel, and the subdivision of those
compartments. These International agreements rely on the states that signed the agreement to
implement the regulations within their waters and on vessels entitled to fly their flag. The ballast is
generally seawater, pumped into ballast tanks. Depending on the type of vessel, the tanks can be
double bottom (extending across the breadth of the vessel), wing tanks (located on the outboard area
from keel to deck) or hopper tanks (occupying the upper corner section between hull and main deck).
These ballast tanks are connected to pumps that pump water in or out. The Ship’s crew fill these tanks
to add weight to the ship and improve its stability when it isn't carrying cargo.

7.3 To Summarize, the USE OF BALLAST TANKS on board the vessel as follows:

 For fully immersing the PROPELLER & RUDDER to ensure the maximum efficiency of the
Engine & Steering.

 To counter the list or trim as the cargo capacity of the ship is distributed unevenly. This is
specially the case on container vessel where multiple Port of loading and multiple port of
discharges are involved.

 The shear and torsion loads on the vessel may increase the stresses on the ship structure,
leading to bending moments and slamming.

 To tackle the issues of dynamic transversal and longitudinal instability.

 The ship continually uses fuel and water from its tanks leading to weight loss. The ballast
operation helps in compensating for the weight loss.

7.4 Types of Ballast Conditions:

7.4.1 The Chief Officer and Master of the ship are responsible for adding or removing ballast water
in the ship’s ballast tanks, depending on the ship stability condition. There are mainly three types of
ballast conditions:

– Light Ballast: When the ship is heavily loaded, and it does not require an additional ballast,
the water ballast tanks are kept empty. This condition is known as a light ballast.

– Heavy Ballast: During the seagoing state, if the ship is not fully loaded, ship ballast tanks are
filled to its capacity. This condition is known as a heavy ballast.

– Port Ballast: Many ports around the world have a restriction for usage of ballast water.
Dedicated port ballast tanks are provided to correct the trim and list of the ship during loading
or discharging operation, and this is called port ballast.

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7.4.2 The water ballast tanks are provided at different locations depending upon the type of the
ship. Following are some of the most common locations for construction of ballast tanks on ships:

7.5 Topside Tanks:

7.5.1 As the name suggests, these are the tanks are located on the topside corner of the ship. The
topside tanks are triangular in shape fitted with wings on both sides of the cargo holds. They are more
common in bulk carrier ships and are constructed using transverse frames arranged in the following
ways:

 A deck transverse under the main deck which supports the deck plating.
 Bottom transverse which forms the part of the supporting frame for the bottom area of
the topside tank.
 Side transverse forms the part of the structure for supporting the side shell plating of the
tank, which is kept in-line with the side shell frames within the cargo holds (in single skin
bulk carriers).
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  These tanks, are directly connected to ship’s main ballast pipelines and during the cargo
loading/ discharging operation, the volume of the ship ballast water in the topside tank is
kept in equilibrium with the cargo weight.
 The design of the topside tanks helps in avoiding a shift of the cargo in inaccessible spaces
for the grab as these tank designs helps in carrying the cargo such as grain etc. without the
need of the trim.

7.6 Lower Hopper Tanks:

7.6.1 Similar in construction to the topside ballast tanks, these water ballast tanks are located on
the bottom wing sides of each cargo hold of the ships, and they are kept in continuation to the double
bottom tanks which run through the centre of the vessel. The hopper tanks provide the following
advantages:

 They act as additional ballast space for the ship.

 Their design offers slopes in the cargo hold corner which ease the collection of the cargo
in the mid position of the hold for better discharging/stripping.
 The adjacent fuel tank plating of the hopper tank forms a slant boundary to carry the static
and dynamic load during cargo loading and ballasting.

7.7 Double Bottom (DB) Tanks:

7.7.1 The double bottom of the ship is a safety feature to avoid ingress of water in case of grounding
or collision. These void spaces are used to store ship ballast water to stabilize the ship.

7.7.2 The double bottom tanks are located between the forward part (till collision bulkhead) to the
aft peak bulkhead, dividing the engine room.

7.7.3 In some ships, such as container and bulk ship, the double bottom space is divided transversely
into three sections (instead of two). This is done to provide an empty space in the centre known as the
“DUCT KEEL” which are used to carry ballast and bunker tank valves, and piping for ships ballast tank
and bunkering system.

7.7.4 The construction of the DB tanks is directly related to the length of the ship as the vessel with
more than 120 m will have additional longitudinal framing in comparison with transverse framing for
vessels of less than 120 m lengths.

7.7.5 Unlike upper topside tanks, these water ballast tanks are adjacent to the fuel oil tanks in the
double bottom. Hence, they are usually not connected to the ballast system to avoid any chance of
contamination.

7.8 Fore and Aft Peak Ballast Tanks:

7.8.1 The fore and aft peak ballast tanks are provided to perform precise trimming operation of the
ship. To achieve the required trim these tanks are hardly filled partially to avoid the free surface effect
of the liquid.

7.8.2 The construction of the fore and aft peak tanks is different from the other ship’s ballast tank
as their shape is pretty irregular due to the location and their shape highly depends on the bow and
the stern design of the vessel.

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7.8.3 The design of these ship ballast tanks is narrow at the bottom end, and as the tank moves
upward, the width of the tank increases significantly. The tank breadth corresponds to the breadth of
ships’ hulls.

7.8.4 The valve used to control the flow of water in the ballast tank can either be manually controlled
butterfly valve or hydraulically operated remote valve. For fore and Aft peak tanks, only remote control
(hydraulic) valves are used due to their location.

8.0 Capacity Measurements on Ships:

8.1 Ships are designed to carry various types of cargo. Depending on the cargo the capacity
measurement units vary.

8.2 The sizes of the vessels over the years have evolved to cater to the growing demands of
International trade.

Ship Type Capacity Measurement

Container Ship TEU (20' & 40')
Tanker Vessel Tonnes / Cubic Meters
Gas Carrier Cubic Meters
Ro-Ro Ship Lane Meters / CBM / Wt Measure
Pure Car Carrier Units
General Cargo CBM / Wt Measure
Bulk Carrier Tonnes

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14
SHIPPING PRACTICE FIRST YEAR

LESSON 2

SURVEYS & CERTIFICATION

AA) FLAG STATE:

1.0 The FLAG STATE of a merchant vessel is the jurisdiction under whose laws the vessel
is registered or licensed, and is deemed the nationality of the vessel.

1.1 A merchant vessel must be registered in one jurisdiction but may change the register in which it
is registered during the life of the ship basis the requirement of its owners. The flag state has
the authority and responsibility to enforce regulations over vessels registered under its flag, including
those relating to inspection, certification, and issuance of safety and pollution prevention documents.
As a ship operates under the laws of its flag state, these laws are applicable if the ship is involved in
an admiralty case.

2.0 The Flag State issues the CERTIFICATE of REGISTRY.

2.1 Ships must be registered in the ship register of the jurisdiction whose flag it is flying. Flag registers
in many countries are open to ships with foreign owners. Normally, each flag state has only one ship
register, but several countries have more than one register:

 Denmark, France and Norway maintain an international register to compete with flags of
convenience.
 The Kingdom of the Netherlands allows the different constituent countries to set up their own
registers under the Dutch flag.
 Several territories over which the British Crown holds sovereignty have their own register. Most
notably, the Isle of Man has a significant register.
 Hong Kong, part of China, has a separate ship register, the fourth largest in the world,[3] in
addition to China's own ship registry.

2.2 The vessel in consideration thus has to comply with all the maritime rules, regulations and
stipulations laid out by the flag state in accordance with the international maritime rules and stipulations.

2.3 For a country to be included in the list of flag states, it has to have the necessary maritime
infrastructure – both financial and technical and should, most importantly, adhere to all the norms and
regulations established by the International Maritime Organization (IMO).

2.4 It is to note that not all vessels are registered to their ship owners’ country of origin.
The country under whose registration such vessels operate is referred to as a FLAG STATE whereas the
practice of registering the ship to a state different than that of the ship’s owner is known as the FLAG OF
CONVENIENCE (FOC)/ OPEN REGISTRIES.

BB) FLAG OF CONVENIENCE (FoC)/ OPEN REGISTRIES:

3.0 The term "flag of convenience" describes the business practice of registering a merchant ship in
a state other than that of the ship's owners, and flying that state's civil ensign on the ship. Ships may be
registered under flags of convenience for any of the following reasons:

15
 1) Reduce operating costs.
2) Flexibility in terms of operations & Manning.
3) Avoid the regulations of or avoid inspection and scrutiny by the owner's country. Normally
the nationality (i.e., flag) of the ship determines the taxing jurisdiction.

3.1 Since the Flag Right Declaration of 1921, it has been recognized that all states—including land-
locked countries—have a right to maintain a ship register and be a ship’s flag state.

3.2 The Flag states have delegated the tasks for enforcing regulations including those relating to
inspection, certification, and issuance of safety and pollution prevention documents to classification
societies who after a proper survey issue such certification and documentation on behalf of the FLAG
STATE.

4.0 OBJECTIVES OF FLAG STATE INSPECTIONS

4.1 Flag State control inspections objectives are the following:

1. Support the quality shipping objectives.

2. They enforce high standard of compliance with international and national rules and standards
for ships registered with the Flag state.
3. Verify the actual condition of ships that they conform to the certificates they carry.

4.2 The scope of the verification includes:

 Hull, equipment and manning.

 Safety management and Security systems.
 Ensure that the ship’s crew can effectively co-ordinate their activities in an emergency.
 Perform functions vital to safety and Prevent or mitigate pollution.

4.3 Monitor the work performed by recognized organizations and nominated surveyors that act on
behalf of the FLAG STATE.

5.0 INSPECTION PROCESS

5.1 Qualified surveyors from the FLAG STATE AUTHORITY conduct flag State control inspections on
periodical basis.

5.2 The Master of the vessel and the owners receive an inspection report upon the completion of an
inspection conducted by the surveyor appointed by the FLAG STATE.

5.3 The Master is required to rectify any deficiencies in accordance with the conditions stated in the
inspection report and report the same back to the FLAG STATE once carried out.

6.0 Scheduled Flag State Inspections:

6.1 Shipping companies are required that vessels under their ownership/management be offered for a
scheduled Flag State Inspection to the nearest Mercantile Marine Department, at a minimum frequency as
mentioned below

16
6.2 Time gap between two FSI is linked to every alternate annual/intermediate/renewal survey for Cargo
ship (5-15 years of age) and every annual/intermediate/renewal statutory survey for cargo ship (15 years and
above) and may exceed stipulated 2 years and 1 year respectively, but the FSI in no case should be carried out
before/after 1-3 months of the completion of concerned annual/intermediate/special survey as the case
may be.

6.3 Indian Flag vessels trading abroad and have completed annual/intermediate/renewal statutory
surveys as the case may be in foreign shores and is not scheduled to touch Indian shores between 1-3 months
after the said survey shall undergo a “General Examination” equivalent to an Annual survey. The frequency of
such general examination is to be not less than that of Flag State Inspections.
(However, in case of port state detention, the frequency of flag state inspection / general examination of said/
all vessels managed/owned by the detained vessel’s Company may be increased by the Directorate).

6.4 In case the vessel is dual classed, General Examination is to be carried out by RO that has not carried
out the last statutory survey of the vessel. General examination of vessel which are not dual class, can be done
through any of the Recognized Organization of GOI as per choice of the owner.

6.5 Indian vessels which have satisfactorily undergone all PSC inspection (since last general examination
or Flag State Inspection) under Paris MOU, USCG or in countries such as Australia, China, Hong Kong, Japan,
Singapore, Republic of Korea, New Zealand and Canada (under Tokyo MOU), without any detainable deficiency
and total number of deficiencies not exceeding five (5), are exempted from next FSI/General Examination.

6.6 The Flag State Inspection and General Examination unlike the port State inspection, should be a
comprehensive and detailed inspection, covering all aspects of the Statutory Certificates issued to the vessel
irrespective of the presence/absence of clear grounds.

6.7 If any serious deficiencies are observed during general examination, which in the judgment of surveyor
may affect the safety of the vessel, crew or marine environment, same is to be informed to the Port State
Control cell of the Directorate for initiating suitable action, before the vessel is allowed to leave the port.

7.0 Un Scheduled Flag State Inspections:

7.1 Notwithstanding the above, the present regime of carrying out “FSI by surprise inspection” by Flag
State will continue as it is.

17
7.2 Any FSI undertaken as part of surprise inspection is not to be taken into consideration for the purpose
of minimum number of scheduled FSI referred under section A(i) above, unless after a review of inspection
report by the concerned Principal Officer, a suitable recommendation is made to the Directorate.

8.0 Reporting, Verification and Monitoring:

8.1 Companies, ROs and MMDs are required to upload all the inspection reports under the General
examination and FSI to the DGS web-based centralized computer information system within 2 working days of
the inspection/examination.

8.2 It is the company responsibility to ensure that the general examination initial and rectification (follow
up) report is uploaded by the recognized organization on the Flag State Computerized Information System
(FSCIS) within the stipulated time period.

8.3 The compliance of this notice will be verified during the annual DOC audit of the company and any
non-compliance may be notified as Non-Conformity to be completed within a period of 1 Month.

8.4 The company should initiate procedures to comply with this notice after the next due
annual/intermediate/renewal statutory surveys.

9.0 ROLE OF FLAG STATE:

 One of the most important roles of the flag states is to arbitrate different types of maritime
conflicts such as accident, salvage etc. under the principle law of ships’ nationality.

 The ship is always on the move and there are high chances of damages to its cargo or structure
at open seas or within the jurisdiction of another country. It is very difficult and impractical
to judge the conflict by any country’s authority. In such cases, the flag state judgment is taken
and based on that, the course of action is decided. However, if the incidence involves damage
to the structure of another ship or land/ post based property or pollution, the local authority
will be involved and have the upper hand on the legal decisions.

 When a situation of salvage occurs, it has to be undertaken as per of the contract. If the
contract does not explain the salvage condition, it will be performed as per the maritime law
of the flag state nation.

 The flag state is responsible for overseeing the International Safety Management Code and it
had the authority to issue or withdraw the ship’s Safety Management Certificate (SMC).

 The basic operational standards for a ship required by IMO and ILO such as competence of
the crew, minimum manning, ship and port security, employment standards, onboard
working conditions, movement of ships between flags, repatriation of the crew, different
audits etc. are also the responsibility of the flag state, by working with ship owners.

 If the port or regulatory authority found out that the ship is not fit for sailing at high seas, the
crew will work as per the flag state instructions specified in SMS along with adequate
monitoring and verification procedures to ensure the issue is resolved as per the requirement.
Usually, the flag state will allow such tasks to one of the selected classification societies.

 Flag state is responsible to cooperate with other authorities or flag states to carry out an
investigation in case of accidents in which causality or pollution is involved.

18
  As per UNCLOS, the flag state must ensure its ships are in compliance with all anti-pollution
requirements and marine pollution laws, i.e. to adopt laws and regulations aiming at
prevention, reduction, and control of pollution.

10.0 CHANGING THE FLAG STATE:

10.1 The change of the flag state can happen if the ship owner or manager decides to shift to another
state or when a ship is sold to another party, which has a different flag state preference.

10.2 For changing the flag state, various lists of documents including electronic plans, details of
seafarer documents, navigation equipment, machinery etc. are submitted to the approaching flag state
along with the change of flag application. Some flag state provides an option to apply for the subsidies for
the approaching flag state before the actual change of flag.

10.3 The official entry into the shipping register of the new flag state for sea-going ships will happen
only after the ship has been deleted from the previous flag state register.

10.4 At the day of flagging-in (with the flag of the new state), the ship is first surveyed by the Safety
Division of the flag state or a by a selected recognized classification society working on behalf of the new
flag state. The surveyor acting on behalf of the flag state or a class surveyor will issue a certificate with a
period of validity of 3 to 5 or more months, depending upon the flag state policy. However, the certificates
are valid immediately.

10.5 After the change of flag, the ship starts operating under interim certificates for a while, and during
this period, the surveyors representing the flag state administration verifies the condition and deficiencies
of the ship. After the complete satisfaction of the flag state, the final ship safety certificates are issued by
the administration and sent to the shipping company.

11.0 PORT STATE CONTROL:

11.1 Ships trade internationally and call at various ports all over the world. Since flag states across the world
have different standards of inspections. Every country would like to ensure that the ships calling at their ports
are inspected to ensure compliance with international and local regulations with regards to safety,
maintenance, manning, etc. This control is termed as Port State Control.

11.2 Flag State Control applies to Ships registered under their flag, whereas Port State Control applies to
ships calling at the ports of the country irrespective of the flag of the ship.

11.3 The Fundamental aim of Port State Control is to eliminate Sub-standard ships to ensure safer ships
and cleaner oceans. The main philosophy of the port state control is to identify sub-standard ships at any port
and corrective action taken before they are allowed to proceed to sea. Provision for control emanates from
the following IMO instruments:-

 Reg. 19 - Chapter 1 of SOLAS Convention 1974 as amended.

 International Convention of Load Line 1966 & its Protocol.
 International Convention for Prevention of Marine Pollution from ships (MARPOL) 73/78.
 International Convention of STCW 1978 as amended.
 International Regulations for preventing Collisions at sea (COLREG) 1972.
 International Labour organization (ILO) convention No. 147.

11.4 These provisions provide for control procedures to be followed by the contracting Governments with
regard to foreign flag vessels visiting their ports. The effective use of the provisions enable the State Authorities
in identifying Sub-Standard Ships and ensuring that remedial measures are taken for the deficiencies identified
by them. Ships of the countries which are not party to the various International Conventions can also be
19
subjected to equivalent inspections to ensure commensurate level of safety. The International Maritime
Organization (IMO) has adopted various Resolutions giving guidelines on such inspections. The guidelines also
provide that all possible efforts should be made to avoid a ship being unduly detained or delayed. However,
wherever necessary Sub-Standard Ships are detained and corrective action taken before allowing them to sail
out to sea.

11.5 To implement effective Port State Control, 15 EEC countries signed a Memorandum of Understanding
in March 1978 at Paris (PARIS MoU) which came into force in 1982.

11.6 Similarly, 10 Latin American countries signed an agreement in November 1992.

11.7 Recently Asia Pacific Memorandum of Understanding has been signed by 17 countries of Asia Pacific.

11.8 Now practically all major maritime countries are party to one agreement or the other for
implementation of Port State Control.

12.0 STATUTORY CERTIFICATES:

Statutory Certificates mean the following certificates including those certificates of compliance required
under the Conventions, etc. to be kept on board the ships. These are regularly checked by the authority
of the ports that the ships regularly visits on her voyage.

The original certificates are retained on board the ships in custody of the MASTER of the vessel.

Statutory certificates will be issued by the Society under the authority of the flag state of the ship.

A classification certificate issued by a classification society recognized by the proposed ship register is
required for a ship's owner to be able to register the ship and to obtain marine insurance on the ship, and
may be required to be produced before a ship's entry into some ports or waterways, and may be of
interest to charterers and potential buyers. To avoid liability, classification societies explicitly disclaim
responsibility for the safety, fitness for purpose, or seaworthiness of the ship, but is a verification only
that the vessel is in compliance with the classification standards of the society issuing the classification
certificate
Some of the statutory certificates are listed below for reference. The applicability of Statute differs with the
vessel type and the certificates required by them as well.

Sr CERTIFICATE Validity
1 International Load Line Certificate 5 Years
2 Cargo Ship Safety Construction Certificate 5 Years
3 Cargo Ship Safety Equipment Certificate 5 Years
4 Cargo Ship Safety Radio Certificate 5 Years
5 Cargo Ship Safety Certificate 5 Years
6 Passenger Ship Safety Certificate 1 Year
7 International Oil Pollution Prevention Certificate
International Pollution Prevention Certificate for the Carriage of Noxious Liquid Substances
8 in Bulk 5 Years
9 International Certificate of Fitness for the Carriage of Liquefied Gases in Bulk 5 Years
10 International Certificate of Fitness for the Carriage of Dangerous Chemicals in Bulk 5 Years
Certificates in compliance with the ISM Code 5 Years
11 (a) Document of Compliance (DOC) 5 Years
(b) Safety Management Certificate (SMC) 5 Years

20
 (c) Interim Document of Compliance (Interim DOC) 12 Months
(d) Interim Safety Management Certificate (Interim SMC) 6 Months
12 International Ship Security Certificate (ISSC) 5 Years
13 International Sewage Pollution Prevention Certificate 5 Years
14 Certificate of Fitness for Ship Carrying Dangerous Goods 5 Years
15 International Air Pollution Prevention Certificate 5 Years
16 International Anti-Fouling System Certificate 5 Years
17 International Energy Efficiency Certificate 5 Years
18 Maritime Labour Certificate (MLC) 5 Years
19 Polar Ship Certificate 5 Years
20 International Ballast Water Management Certificate 5 Years

LIST OF CERTIFICATES AND DOCUMENTS REQUIRED TO BE CARRIED ON BOARD CARGO SHIPS EXCEPT
HIGH SPEED CRAFT ARE LISTED IN THE BELOW LINK.

https://www.irclass.org/media/2464/encl1-list-of-certificates-and-documents-cargo-ships.pdf

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21
SHIPPING PRACTICE FIRST YEAR

LESSON 3

CLASSIFICATION SOCIETIES
1.0 INTRODUCTION:
1.1 In I860, a group of persons who were engaged in the business of marine insurance formed Lloyd's
Register of British and Foreign Shipping as an association for protecting their interests at a time when
there were no standards laid down for the strength or seaworthiness of ships. The formation of other
classification societies followed. These were formed by various shipping nations and had very similar rules
thus ensuring a generally high standard of ship construction and seaworthiness.

1.2 A classification society is an independent, non-profit making body directed by a committee of

persons representing ship owners, shipbuilders, engine-builders and underwriters. They exist for the
purpose of ensuring that ships are properly constructed and maintained in a seaworthy and safe
condition.

1.3 They provide services and operate under three principal characteristics:

1. Impartiality because of the variety of interests involved in ships, requiring standards to

be maintained to reflect the needs of all parties.
2. Technical competence — ship building is now a complex science with new materials,
new techniques and new functions.
3. A desire to assist the industry as a whole because it is a service organization and
therefore requires innovation and constant developments.

1.4 Thus, in order to fulfil this function of theirs, they make rules which govern the construction of
the ships. They arrange to carry out surveys during the building of a ship and also survey the ship
throughout its subsequent trading life. Ships are graded into "classes" depending upon the type of ship
(e.g. tanker, cargo ship, bulk carrier, passenger ship, trawler etc.); service for which the ship was designed
(coastal trade, deep sea, within lakes, etc.); compliance with the society's rules; anchoring and mooring
equipment carried on board; details of machinery; details of strengthening for navigation in ice, etc. The
classification is carried out by means of surveying and certifying that the vessel complies with the
specified standards and is maintained to those standards. They also conduct research into all forms of
construction, efficiency and safety of sea-going vessels, off-shore equipment such as oil-rigs and shore
plants.

1.5 Basically, classification societies perform three important functions, viz. –

1. They make and publish rules for the construction of ships which are to be registered with the
individual society to enable the designers to know the sizes (technically referred to as
"scantlings") of component parts that will be acceptable and safe.
2. They receive the plans of the ship for approval, the details of the materials to be used for
construction and. place their surveyors under whose supervision the ship is constructed. Thus, they
ensure a good standard of workmanship and ensure that the ship is properly designed. The rules
also require that periodical (i.e. annual, two-yearly, four-yearly, etc.) surveys are carried out to
maintain the ship in good condition ("in good condition" means to be "in class") during its working
life.
3. They publish a register book which contains in abbreviated form details for all "classed" ships
such as dimensions, hold capacities, derrick capacities and equipment etc., which might be of
interest to charterers, underwriters, bankers, shippers and others interested in shipping.
NOTE: Also study (a) Para 2, Page 77, Chapter 14 (The Ship) and (b) Chapter 15 (Lloyd's Register of Shipping), Pages 80 to 89, in
"Shipping Practice" text-book by Stevens & Butterfleld Special emphasis should be laid on the KEY to the Register of Ships, Pages 88-
89.
22
2.0 WHY DO SHIPOWNERS ENTER THEIR VESSELS WITH A CLASSIFICATION
SOCIETY?
2.1 It is not mandatory for a ship owner to enter his vessel in a classification society and subject himself to
these controls. The purpose of classification is mainly for the assistance of the ship owners whose ships are
classed. This assistance may be necessary, for example, to obtain finance for the purchase or building of a
vessel. The ship owner may also be helped by his ships being classed with a society that has good, acceptable
standards if he wishes to seek permission from a government to man and operate a ship under the flag of
that country.

2.2 A very important benefit to the ship owner is that by entering his ship with a classification society, he
will be able to comply with the rules of insurance cover: Under the Termination Clause in the "Institute Time
Clauses (Hulls) - 1/10/83" the insurance cover terminates automatically at the time "Change of the Classification
Society of the vessel or change, suspension, discontinuance, withdrawal or expiry of its class therein, provided that
if the vessel is at sea, such automatic termination shall be deferred until arrival at, her next port." In any case, it
should be remembered that when a vessel is being insured for the first time with an insurer, the premium is
likely to depend not only on whether or not the vessel is classed but also on the society with which the vessel
may be classed. Shippers of cargoes are also usually worried when loading their cargoes. While insuring their
cargoes, they are subjected to what is referred to as the "Classification Clause" where the premium on the
cargo will depend on whether the vessel in which the cargo is to be carried is seaworthy as evidenced by its
being classified by a prominent classification society.

2.3 Ship classification is an important function. Ship classification by the traditional societies consists
fundamentally of:

1. Establishing standards of structural strength.

2. To issue the classification certificate, from which the shipowner, insurer and other interested
parties, can be confident that the vessel is of the standard required by the Society's rules.
3. Set technical rules & confirm that designs and calculations meet these rules, survey ships and
structures during the process of construction and commissioning.
4. Supervising construction in any shipyard in the world to ensure proper standard of
workmanship and materials.
5. Conduct Periodical surveys to ensure that they continue to meet the rules.
6. Classification societies are also responsible for classing oil platforms, other offshore structures,
and submarines. This survey process covers diesel engines, important shipboard pumps and
other vital machinery including ISO Tanks & ISO Containers.
7. Classification surveyors inspect ships to make sure that the ship, its components and
machinery are built and maintained according to the standards required for their class.

3.0 Other services offered by classification societies are:

1. Tonnage measurement and certification.

2. Control of compliance with International Conventions. Acting with delegated authority on behalf of
governments in respect of statutory requirements and issue of certificates.
3. Supervising conversions (e.g. conversion of tanker into a cattle carrier, etc.)
4. Technical supervision and certification of containers.
5. Research and development & Advice to clients.

3.1 Most major maritime nations have their own classification societies. Some of these societies are
concerned with their own national tonnage but others are more international in their outlook.

23
3.2 The leading societies belong to the International Association of Classification Societies
(I.A.C.S.), a body which seeks to represent the societies internationally. The rules of the different societies vary
in minor details, but are mainly similar.

3.3 Some of the Examples of Classification Societies are listed below:

Society Symbols/Identification letters

Lloyd's Register of Shipping, London (UK) LR
American Bureau of Shipping, New Jersey (USA) AB/ABS
Bureau Veritas, Paris (France) BV
Det Norske Veritas, Hovik (Norway) NV/DNV
Germanischer Lloyd, Hamburg (Germany) GL
Nippon Kaiji Kyokai, Tokyo (Japan) NK
Registro Italiano Navale, Genoa (Italy) RL/RINA
Polski Rjestr Statkow, Gdansk (Poland) PR
Hellenic Register of Shipping, Pireaus (Greece) HR/PHR
Bulgarian Register of Shipping (Bulgaria) BR
Register of Shipping of PRC, Beijing (China) ZC
Indian Register of Shipping, Mumbai (India) IRS
Korean Register of Shipping, Seoul (Rep of Korea) KR
Registru Naval Romania, Bucharest (Romania) RNR
Yugoslav Register (Yugoslavia) JR

4.0 SURVEYS & CERTIFICATES:

4.1 A class survey is a visual examination that normally consists of:

 Overall examination of the items identified in the Rules for survey.

 Detailed checks of selected parts, on a sampling basis.
 Witnessing tests, measurements and trials where applicable.
• When a surveyor identifies corrosion, structural defects or damage to hull, machinery and/or
piece of equipment which, based on the Society’s Rules, affects the ship’s class, remedial
measures and/or appropriate recommendations/conditions of class are specified in order to
retain class.
• ‘Recommendation’ and ‘condition of class’ are different terms used by IACS Societies for specific
measures, repairs, request for surveys etc., are to be carried out within a specified time limit in
order to retain class.

5.0 Ships are subject to a through-life survey regime if they are to be retained in
class.
• Class renewal (also called “special survey”) is held every 5 years
• Intermediate survey (Between the 2nd & 3rd Annual)
• Annual survey
• Bottom/docking surveys of the hull.
• Tailshaft survey, boiler survey, machinery surveys.
• On Request for a “Condition of Class” or “Recommendation”.

24
5.1 Each classed vessel is subject to a specified program of periodic surveys after delivery.

• Class renewal surveys/special surveys are carried out at five-year intervals. +/- Maximum period
of 3 months after the due date.
• Annual surveys are to be carried out within a window from +/- 3 months of anniversary date.
• Intermediate survey is to be carried out within the window from +/- 3 months before the mid of
2nd & 3rd anniversary date.
• Bottom / Docking Survey - The outside of the ship's hull and related items are to be examined on
two occasions in the five-year period of the certificate of class with a maximum of 36 months
between surveys. One of the two bottom/docking surveys to be performed in the five-year period
is to be concurrent with the class renewal/special survey.

Certificate/Survey Issued by Validity/Duration

Certificate of Registry
Safety Construction
International Load Line
International Tonnage
Safety Equipment
Safety Radio (GMDSS)
Radio Station Licence
IOPP/MarpoI 73/78
Special Survey Hull
Special Survey Machinery
Dry Dock Survey
Tail Shaft Survey
Boilers
CERTIFICATE of CLASS
Safety Management Cert (ISM)
Document of Compliance (ISM)
DOC under IMDG code
Flag State Permanent or till expiry
CLASS on behalf of Flag State 5date
years
CLASS on behalf of Flag State 5 years
CLASS on behalf of Flag State Permanent or till expiry
CLASS on behalf of Flag State 2 years
CLASS on behalf of Flag State 1 year
CLASS on behalf of Flag State Permanent or till expiry
CLASS on behalf of Flag State 5date
years
Classification Society 4 (+ 1 year grace)
Classification Society 4 (+ 1 year grace)
Classification SocSociety
Classification 2-3 years
Classification Society 4-5 years
Classification Society 2 years
Classification Society 1 year
Classification Society 5 Years
Classification Society 1 Year
CLASS on behalf of Flag State 5 Year

6.0 INDIAN REGISTER OF SHIPPING (IRS)

6.1 The Indian Register of Shipping (IRS) is an internationally recognized, independent ship
classification society which was founded in India in 1975. In 1991, the IRS was admitted as an Associate
Member of the International Association of Classification Societies (IACS) which is the major international body
of classification societies. The IRS is a public limited company (under section 25 of the Indian Companies Act)
having no shareholders. It is managed by a Committee of Management which has representatives from each of
the industry segments that use its services. These include representatives from the maritime industries,
underwriters, general engineering, government agencies and defense services. They are further supported by
sub-committees such as the Technical Committee, the Classification Sub-committee, the Quality Sub-committee
and the Research Advisory Sub-committee for all operational aspects of IRS which cover marine, offshore and
industrial services.

6.2 The Technical Committee is responsible for setting up of all rules and regulations and all other
matters relating to technical aspects. The Classification Sub-committee is responsible for all matters relating to
classification of ships. The Quality Sub-committee is responsible for IRS activities relating to quality
assurance/insurance including the working of Indian Register Quality Systems (IRQS), a department of IRS. The
Research Advisory Sub-committee is responsible for all matters regarding research and development of
activities of IRS.
25
6.3 IRS has two principal divisions:

1. Technical Services Division

2. Classification and Certification Division.

6.4 The Technical Services Division is responsible for providing technical support for all activities of IRS
and operational aspects of IRQS.

6.5 The Classification and Certification Division is responsible for all operational aspects of IRS which cover
marine, offshore and industrial services.

6.6 The IRS provides professionally competent, completely independent and highly efficient third party
technical inspection and certification services for all types of marine craft and structures. These services have
also been expanded to cover a range of offshore and industrial projects. Designed as per ISO 9001, the
International Standard in Quality Management System, these services help achieve a high level of quality and
reliability and help maintain project schedules and integrity. They are proven to be cost effective and time
efficient.

6.7 IRS has 23 representation offices all over India & the globe in order to establish that the services
provided by IRS are of international standards and to maintain its membership status in International
Association of Classification Societies (IACS), the entire classification and statutory activities beginning from
rule development, modification and implementation were audited and certified by IACS in March 1996.

6.8 The Rule Book 1997 for Construction and Classification of Steel Ships have been modified and
updated, incorporating latest technological developments and includes the changes in the statutory
requirements. The Inland Waterways Rules on the same lines as the main rules have also been developed for
the first time in the country and three parts of these rules have been published while one remaining part of
the rules was to be published by the end of 1997.

7.0 Recognitions & Achievements:

 IRS became an Associate of IACS in 1991 within a short span of 16 years of existence
 IRS became Full member of IACS in June 2010 after having complied with the stringent criteria
of IACS
 IRS has been recognized by International Underwriting Association (IUA), London for inclusion
in Institute Classification Clause from year 2000 (even at the time of being an Associate of
IACS)
 IRS has been recognized by India and 21 other Maritime Administrations including Panama,
Liberia and Marshall Islands for Statutory Surveys & Certification.
 IRS has been appointed as the sole authority for Load line assignment for Indian flag.

8.0 DUAL CLASSIFICATION:

8.1 In order to insure ships and cargoes, it becomes essential for any ship owner to indicate that his ship is
in a seaworthy condition and in all ways fit to carry out the voyage for which it is desired. While the insurance
companies do not have their own infrastructure or logistics to carry, out the task of checking seaworthiness of
vessels, they place reliance upon prominent Classification Societies. Prominent Classification Societies are those
Classification Societies which are full members of the IACS.

26
8.2 When the Indian Register of Shipping (IRS) was formed it was not associated with IACS. In order to achieve
its goal of being recognized as a full member of IACS and consequent to that as an independent Classification
Society, it entered into arrangements with full members of IACS for carrying out all surveys and classification
requirements. Under this type of tie-up, ship owners, particularly Indian ship owners, were persuaded to
comply with and carry out survey requirements both with the IRS as well as with their existing Classification
Society. This tie-up was referred to as "dual classification" and ships classed with IRS as well as with its existing
Classification Society were said to be "dual classified". IRS has now become a FULL MEMBER of IACS and
continues to carry out classification of ships both "singly" as well as "dually". There are many ships which are
only classified by IRS and no other Classification Society.

8.3 Usually, the norms of all Classification Societies are the same but where they differ then the
following rule applies:-

"Where a vessel holds dual classification with IRS and the periodical survey requirements, of the
corresponding society differ from those of the rules of IRS, the Committee may permit the
requirements of the corresponding society being applied, so that as they are equivalent in purpose or
are no less stringent than the IRS rule requirement."

8.4 There are presently about 600 ships classed (singly and/or dually) by IRS till March 1997.

9.0 Classification Symbols:

9.1 Every Classification Society assigns specific symbols to vessels that are usually peculiar to that
Classification Society and have a significance that relates to that vessel. Some of the standard specifications are
given below:

9.2 Built under Survey:- When ships are built in specific compliance of the rules of a Classification Society,
involving the continuous presence and supervision of its surveyors, it is said to be "built under survey". Symbol
for "built under survey" in the Lloyds Register is a Maltese cross »Ja (This symbol is also given by DNV, BV, ABS
etc.) The symbol of "swastika" is given by IRS.

9.3 Main Class Notation:- This notation is assigned to sea-going vessels to indicate that the ship’s scantlings
(dimensions), its machinery and equipment (i.e. anchors, chains, cables, hawsers) meet the rule requirements
for assignment of this notation. The symbols given by various societies are indicated below:

Society Symbol for Scantlings Symbols for Equipment in order

LR in100
order
A 1
IRS SU L
NV/DNV 1A 1
BV 13/3 E
AB/ABS Al E

oooooo

27
 SELF EXAMINATION QUESTIONS

1. What are the principal characteristics under which a Classification Society operates?
2. Discuss the primary and secondary functions and services performed by Classification
Societies.
3. Give reasons why a ship owner enters his vessel with a Classification Society even though it is not
mandatory to do so?
4. Name any 8 Classification Societies and state their symbols/identification letters. Also the cities &
countries where their head offices are located.
5. Who issues the following certificates/surveys and what is their validity/duration?
(i) Safety Equipment.
(ii) Classification Certificate.
(iii) Special Survey Hull.
(iv) De-ratting Exemption.
(v) Certificate of Registry.

6. Write a note on IACS & IRS

7. State "True" or "False". If false, give the correct answers.

(a) A classification society is a government body.
(b) It is compulsory for a vessel to be classed.
(c) "PR" are the identification letters of Hellenic Register of Shipping, Pireaus.
(d) IRS is not a member of the IACS
(e) IACS is a classification society.
(f) Tail Shaft Survey is issued by the Flag State.
(g) IRS was founded in 1970 and in 1990 was admitted as an Associate Member of IACS.
(h) All Indian vessels are compulsorily classified by IRS and one other international classification
society.
(For answers please see the above Lesson as well as the "Shipping Practice" textbook by Stevens &
Butterfield).

RECOMMENDED BOOKS FOR READING:

1. Elements of Shipping - A.E. Branch, 7th Ed., 1996.

Good reading material on Classification Societies. See Pages 31-33 for Survey Methods; Section 8.7 on
Pages 145 to 149 for Lloyd's Register of Shipping; Section 8.8 on Pages 149-154 for Bureau Veritas.
2. Sea Transport - P.M. Alderton, 4th Ed., 1985.
Chapter 1 — Sub-heading "The Number and Classification of Ships", Pages 1 to 4.
3. Bes' Chartering & Shipping Terms - N.J. Lopez, 11th Ed., 1992.
Chapter 7 entitled "Classification of Ships", Pages 471-476. This book explains the topic with great clarity.
4. Classification Societies - J. Lux, 1st Ed., 1997.
A detailed volume published by Lloyd's of London Press Ltd. Recommended only for a student who is
interested in studying the subject at great length.

*********************

28
SHIPPING PRACTICE FIRST YEAR

LESSON 4

LETTER OF CREDIT & INCOTERMS

1.0 INTRODUCTION:

1.1 A letter of credit is a definite undertaking, pursuant to an authenticated record, usually

by a commercial bank (referred to as the "issuer"), for the benefit of another person (referred to
as the "beneficiary") at the request and for the account of a third person (referred to as the
"applicant") to honor a documentary presentation by payment or delivery of an item of value.

1.2 Letters of credit have evolved over hundreds of years of commerce. Traditionally they
have been used in connection with the sale of goods between distant parties. International trade
must work around a fundamental dilemma since both the exporter and importer:

 They live far apart

 They speak different languages
 They operate in different political environments
 They have different religions
 They have different standards for honoring obligations

2.0 In essence, there could be distrust, and clearly the importer and exporter would prefer two
different arrangements for payment /goods transfer.

2.1 The BUYER would be reluctant to part with its money until they knew the goods were safely
en route.

2.2 The SELLER was unwilling to ship the goods until it knew the money was ready at hand.

2.3 This impasse was resolved by a bank issuing a letter of credit pursuant to which the bank
undertook to pay the seller upon presentation by the seller of bills of lading evidencing the shipment
of the goods and evidencing the satisfaction of other conditions.

2.4 The seller felt comfortable having the credit of the bank on the letter of credit, as opposed to
the credit of an unknown buyer.

2.5 The buyer felt comfortable that the bank would not disburse the funds until it had the shipping
and other documents in hand.

2.6 The use of letters of credit has evolved significantly from this early scenario. Letters of credit
are now used not only in transactions involving the sale of goods but also in numerous other types of
transactions where credit enhancement is desired.

3.0 The following is a quick summary of letter of credit law and practice. By its nature, many of the
details have been simplified. Before using a letter of credit, the parties should consult with a person
knowledgeable in letter of credit practice. We start with an underlying transaction between two
parties. This can be a sale of goods, a loan, an equipment lease, or whatever. One of the parties (the

29
beneficiary) is uncomfortable extending credit to the other party solely on the basis of the
creditworthiness of the other party (the applicant).

3.1 The applicant is the person or entity that applies to the issuer for a letter of credit. The
applicant is also referred to as the “customer” or the “account party.” The issuer is normally a
commercial bank but can also be any type of person or entity. The issuer issues the letter of credit to
the beneficiary and thus adds its own credit to the applicant’s.

3.2 In some situations a second bank will “confirm” the letter of credit. This means that the
confirmer will take on all the responsibilities of the issuer vis-à-vis the beneficiary. After a confirmer
pays a complying draw, it in turn has reimbursement rights against the issuer. If the beneficiary wishes
the backing of a large bank but the applicant’s contacts are only with its local bank, confirmation of
the letter of credit by the local bank’s correspondent bank solves the impasse. Confirmers are also
frequently encountered in international transactions where the issuer is in the applicant’s home
jurisdiction and the confirmer is in the beneficiary’s home jurisdiction.

3.3 A letter of credit basically provides that, if the beneficiary presents the documents required by
the letter of credit to the issuer, the issuer will promptly pay the beneficiary. The key to this
arrangement is that the letter of credit is documentary. This means that the issuer pays only against
the presentation of documents. If the documents comply with the requirements of the letter of credit,
the beneficiary gets paid. If the documents do not comply, the beneficiary does not get paid, at least
not through the letter of credit. The beneficiary may still have a claim against the applicant on the
underlying contract. We will get into more detail on the standard for compliance of the documents
shortly, but for now, suffice it to say that the general standard is one of strict compliance.

4.0 Letters of credit can be divided into two broad categories. First, the traditional letter of credit
involving the sale of goods is often called a commercial letter of credit. The parties anticipate that, if
the transaction goes well, the beneficiary will be paid through the letter of credit mechanism. The
second type of letter of credit is the standby letter of credit. These are normally used in situations
where the parties anticipate that the letter of credit will not be drawn upon unless something goes
wrong in the underlying transaction. An example would be a letter of credit issued to an equipment
lessor which permitted the equipment lessor to draw under the letter of credit by presentation of a
certificate that there was a default in the underlying transaction. Note here that, because the letter of
credit is documentary, the condition for payment is not that there is a default in the underlying
transaction, but that the beneficiary should submit a certificate stating that there is a default in the
underlying transaction. An issuer is not in a position, particularly given the small margins it makes on
letters of credit, to investigate whether a default has in fact occurred. Its job is merely to compare the
certificate against the letter of credit to determine whether the certificate complies with the
requirements of the letter of credit. This is a very ministerial process and is key to the functioning of a
letter of credit.

4.1 One of the documents normally required under a letter of credit is a sight draft or a time draft.
A draft is similar to a check in which the beneficiary instructs the issuer to pay a fixed amount to the
beneficiary. A sight draft is one which is payable upon receipt by the issuer. A time draft is one that is
payable at a specified number of days after receipt by the issuer.

4.2 Letters of credit invariably have an expiration date. If a complying presentation of documents
is not made before the expiration date, the letter of credit essentially evaporates. Hence it is critical
for the beneficiary to calendar the expiration date of a letter of credit. Some letters of credit have
evergreen clauses. Under such clauses, a letter of credit can be extended for additional time periods
(usually one year) unless the issuer sends notice to the beneficiary within a prescribed time period
before the current expiration that the expiration date will not be extended. To put teeth in the
evergreen clause, the evergreen clause normally provides that, if a notice of non-extension is sent, the

30
beneficiary can draw under the letter of credit with only a draft without the other documents which
would normally be required. Evergreen (or auto-renewal) clauses are in a state of constant evolution
as litigation over their mechanics motivates more detailed clauses.

4.3 The issuer does not issue the letter of credit for free. The issuer will require the applicant to
pay certain issuance fees and to sign a reimbursement agreement. The reimbursement agreement
contains the applicant’s promise to reimburse the issuer if the issuer has to pay on the letter of credit.
It also contains a number of credit provisions similar to what one might find in a loan or credit
agreement, including representations, warranties, covenants and the like. The reimbursement
agreement can be secured just like any other credit agreement so that, if the issuer has to pay on the
letter of credit, the issuer will have recourse against the security posted by the applicant. A very
common form of security in letters of credit is the posting of cash collateral. The reimbursement
agreement usually also contains provisions establishing the issuer’s standard of care in paying or not
paying under the letter of credit. For instance, even though the issuer is obligated to pay the
beneficiary only if the documents submitted by the beneficiary strictly comply with the letter of credit,
most reimbursement agreements obligate the applicant to reimburse the issuer even if the issuer pays
against documents which substantially, but not strictly, comply.

5.0 The appeal of the letter of credit to the beneficiary is at least twofold. First, the issuer’s credit
is on the line in addition to that of the applicant. Second, if properly handled, the letter of credit is
often deemed to be “as good as cash.” There are very few defenses to payment on a letter of credit.
These include:

(1) The documents presented by the beneficiary do not comply with the letter of credit.
(2) The letter of credit has expired.
(3) There is fraud in the transaction.
(4) The bank is insolvent (this may not be a legal defense but it nevertheless results in non-
payment).

5.1 The prudent beneficiary normally has control over the first three possible defenses. As to the
fourth, the insolvency of the issuer, the beneficiary should insist that the letter of credit be issued by
a highly creditworthy bank.

5.2 A letter of credit contains specific details about the planned business transaction, such as the
monetary amount of the agreement, the time frame of the business deal, the terms and conditions of
the deal, the documentation required to prove the transaction has been completed and the specific
place the documents are to be brought.

5.3 An applicant must prove to the issuing bank that they have the funds to pay for the transaction,
possibly depositing the entire amount or using the bank's line of credit. The seller only gets paid after
performing the promised services. The issuing bank reviews documents proving that the seller
provided as agreed and releases funds, not taking into account the quality of the service or if the buyer
was pleased.

THE BANKS DEAL WITH DOCUMENTS, NOT THE GOODS.

6.0 Some of the documents a seller may provide to the bank include but not limited to the
following:

 Commercial invoices.
 Transport documents.
 Inspection certificates
 Insurance documents
31
  Certificate of origin.
 Bill of Lading (SOB Bill of Lading & Master Bill of Lading)
 Any other Requirement [e.g. Phyto sanitary certificate]

6.1 According to some consultancy agencies, A big problem with letters of credit is that seller’s
documents are rejected in at least 50 % of transactions. The National Council on Trade Documentation
reports that letter of credit failure rates of 75 % in San Francisco and 77 % in St. Louis. Some of the
reasons letters of credit fail are failure to meet the timeline, a discrepancy within the letter of credit
or failure to comply with the terms and conditions.

6.2 Advantages of a Letter of Credit to an EXPORTER:

• Credit risk eliminated

• Reduces exchange rate and political risk
• No Need for Credit Check
• Requirements to pay are well-known
• Pre-shipment risk avoided
• Facilitates financing
• Immediate payment

6.3 Advantages of a Letter of Credit to an IMPORTER:

• Expert Examination of Documents

• Sources of Supply expand
• Financing
• No cash tied up
• Payment only after compliance of on board date

32
Sample Letter of Credit

33
7.0 INCOTERMS
7.1 ICC’s Incoterms rules are the world’s essential terms of trade for the sale of goods. Whether
you are filing a purchase order, packaging and labelling a shipment for freight transport, or preparing
a certificate of origin at a port, the Incoterms rules are there to guide you. The Incoterms rules
provide specific guidance to individuals participating in the import and export of global trade on a
daily basis.

7.2 Since its founding in 1919, ICC has been committed to the facilitation of international trade.

7.3 Different practices and legal interpretations between traders around the world necessitated a
common set of rules and guidelines. As a response, ICC published the first Incoterms rules in 1936.
ICC has been maintaining and developing them ever since.

7.4 Incoterms is an acronym standing for international commercial terms. Incoterms is a

trademark of International Chamber of Commerce, registered in several countries.

7.5 The Incoterms rules feature abbreviations for terms, like FOB (“Free on Board”), DAP
(“Delivered at Place”) EXW (“Ex Works”), CIP (“Carriage and Insurance Paid To”), which all have very
precise meanings for the sale of goods around the world.

7.6 The use of Incoterms eliminates inconsistencies in language by giving all parties the same
definition of specific terms within a trade agreement. As a result, the risk of problems during shipment
is reduced since all parties clearly understand their responsibilities in performing trade under the given
contract.

7.7 Below are some of the commonly used INCOTERMS.

8.0 RULES FOR ANY MODE OR MODES OF TRANSPORT:

8.1 EXW Ex Works: “Ex Works” means that the seller delivers when it places the goods at the
disposal of the buyer at the seller’s premises or at another named place (i.e. works, factory,
warehouse, etc.). The seller does not need to load the goods on any collecting vehicle, nor does it need
to clear the goods for export, where such clearance is applicable.

8.2 FCA Free Carrier: “Free Carrier” means that the seller delivers the goods to the carrier or
another person nominated by the buyer at the seller’s premises or another named place. The parties
are well advised to specify as clearly as possible the point within the named place of delivery, as the
risk passes to the buyer at that point.

8.3 CPT Carriage Paid To: “Carriage Paid To” means that the seller delivers the goods to the carrier
or another person nominated by the seller at an agreed place (if any such place is agreed between
parties) and that the seller must contract for and pay the costs of carriage necessary to bring the goods
to the named place of destination.

8.4 CIP Carriage and Insurance Paid To: “Carriage and Insurance Paid to” means that the seller
delivers the goods to the carrier or another person nominated by the seller at an agreed place (if any
such place is agreed between parties) and that the seller must contract for and pay the costs of carriage
necessary to bring the goods to the named place of destination.

8.4.1 ‘The seller also contracts for insurance cover against the buyer’s risk of loss of or damage to
the goods during the carriage. The buyer should note that under CIP the seller is required to obtain
insurance only on minimum cover. Should the buyer wish to have more insurance protection, it will

34
need either to agree as much expressly with the seller or to make its own extra insurance
arrangements.”

8.5 DAT Delivered At Terminal: “Delivered at Terminal” means that the seller delivers when the
goods, once unloaded from the arriving means of transport, are placed at the disposal of the buyer at
a named terminal at the named port or place of destination. “Terminal” includes a place, whether
covered or not, such as a quay, warehouse, container yard or road, rail or air cargo terminal. The seller
bears all risks involved in bringing the goods to and unloading them at the terminal at the named port
or place of destination.

8.6 DAP Delivered At Place: “Delivered at Place” means that the seller delivers when the goods
are placed at the disposal of the buyer on the arriving means of transport ready for unloading at the
named place of destination. The seller bears all risks involved in bringing the goods to the named place.

8.7 DDP Delivered Duty Paid: “Delivered Duty Paid” means that the seller delivers the goods when
the goods are placed at the disposal of the buyer, cleared for import on the arriving means of transport
ready for unloading at the named place of destination. The seller bears all the costs and risks involved
in bringing the goods to the place of destination and has an obligation to clear the goods not only for
export but also for import, to pay any duty for both export and import and to carry out all customs
formalities.

9.0 RULES FOR SEA AND INLAND WATERWAY TRANSPORT:

9.1 FAS Free Alongside Ship: “Free Alongside Ship” means that the seller delivers when the goods
are placed alongside the vessel (e.g., on a quay or a barge) nominated by the buyer at the named port
of shipment. The risk of loss of or damage to the goods passes when the goods are alongside the ship,
and the buyer bears all costs from that moment onwards.

9.2 FOB Free On Board: “Free On Board” means that the seller delivers the goods on board the
vessel nominated by the buyer at the named port of shipment or procures the goods already so
delivered. The risk of loss of or damage to the goods passes when the goods are on board the vessel,
and the buyer bears all costs from that moment onwards.

9.3 CFR Cost and Freight: “Cost and Freight” means that the seller delivers the goods on board the
vessel or procures the goods already so delivered. The risk of loss of or damage to the goods passes
when the goods are on board the vessel. The seller must contract for and pay the costs and freight
necessary to bring the goods to the named port of destination.

9.4 CIF Cost, Insurance and Freight: “Cost, Insurance and Freight” means that the seller delivers
the goods on board the vessel or procures the goods already so delivered. The risk of loss of or damage
to the goods passes when the goods are on board the vessel. The seller must contract for and pay the
costs and freight necessary to bring the goods to the named port of destination.

9.4.1 ‘The seller also contracts for insurance cover against the buyer’s risk of loss of or damage to
the goods during the carriage. The buyer should note that under CIF the seller is required to obtain
insurance only on minimum cover. Should the buyer wish to have more insurance protection, it will
need either to agree as much expressly with the seller or to make its own extra insurance
arrangements.”

35
INCOTERMS

36
10.0 UCP 600:
10.1 The UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (UCP) is a set of rules
on the issuance and use of letters of credit. The UCP is utilized by bankers and commercial parties in
more than 175 countries in trade finance. Some 11-15% of international trade utilizes letters of credit,
totaling over a trillion dollars (US) each year.

10.2 A significant function of the ICC is the preparation and promotion of its uniform rules of
practice.

10.3 The ICC's aim is to provide a codification of international practice occasionally selecting the
best practice after ample debate and consideration.

10.4 The UCP is the work of the ICC, a private international organization founded in 1919.
Formulated entirely by experts in the private sector. It remains, to date, the most successful set of
private rules for trade ever developed.

10.5 The ICC rules of practice are designed by bankers and merchants and not by legislatures with
political and local considerations.

10.6 The rules accordingly demonstrate the needs, customs and practices of business. Because the
rules are incorporated voluntarily into contracts, the rules are flexible while providing a stable base for
international review, including judicial scrutiny.

10.7 International revision is thus facilitated permitting the incorporation of the changing practices
of the commercial parties. ICC, which was established in 1919, had as its primary objective facilitating
the flow of international trade at a time when nationalism and protectionism threatened the easing of
world trade.

10.8 It was in that spirit that the UCP were first introduced – to alleviate the confusion caused by
individual countries’ promoting their own national rules on letter of credit practice. The aim was to
create a set of contractual rules that would establish uniformity in practice, so that there would be
less need to cope with often conflicting national regulations. The universal acceptance of the UCP by
practitioners in countries with widely divergent economic and judicial systems is a testament to the
rules’ success.

10.9 An example of this would be as mentioned in Article 3 which are commonly a point of debate
between Buyers & Sellers.

10.10 For determining a period of shipment, the words “FROM” and “AFTER” have different
meanings

Shipment to be Effected "FROM" May

Earliest Shipment date is May 15th
15th

Shipment to be Effected "AFTER" May

Earliest Shipment date is May 16th
15th

37
10.11 The UCP remain the most successful set of private rules for trade ever developed. A range of
individuals and groups contributed to the current revision including: the UCP Drafting Group, which
waded through more than 5000 individual comments before arriving at this final text; the UCP
Consulting Group, consisting of members from more than 25 countries, which served as the advisory
body; the more than 400 members of the ICC Commission on Banking Technique and Practice who
made pertinent suggestions for changes in the text; and 130 ICC National Committees worldwide which
took an active role in consolidating comments from their members.

10.12 During the revision process, notice was taken of the considerable work that had been
completed in creating the International Standard Banking Practice for the Examination of Documents
under Documentary Credits (ISBP), ICC Publication 745. This publication has evolved into a necessary
companion to the UCP for determining compliance of documents with the terms of letters of credit.

10.13 Where a credit is issued subject to UCP600, the credit will be interpreted in accordance with
the entire set of 39 articles contained in UCP600. However, exceptions to the rules can be made by
express modification or exclusion.

10.14 For example, the parties to a credit may agree that the rest of the credit shall remain valid
despite the beneficiary's failure to deliver an installment. In such case, the credit has to nullify the
effect of article 32 of UCP600, such as by wording the credit as:

10.14.1 “The credit will continue to be available for the remaining installments notwithstanding the
beneficiary’s failure to present complied documents of an installment in accordance with the
installment schedule.”

oooooo

SELF-EXAMINATION QUESTIONS
1. Enumerate advantages of a Letter of Credit to an exporter?
2. Enumerate advantages of a Letter of Credit to an importer?
3. List down the documents a seller may need to provide to the bank under a letter of credit?
4. What are the few defenses to payment on a letter of credit?
5. Define the broad two categories of letter of credit?
6. In International trade which is the fundamental dilemma for both the exporter and
importer?

Important:
For commercial letters of credit you should consult UCP 600 and ISBP 2013 as reference books. These two
publications are the only official ICC publications that govern the letters of credit rules.

**********

38
SHIPPING PRACTICE FIRST YEAR

LESSON 5

BILL OF LADING

1.0 While there is evidence of the existence of receipts for goods loaded aboard merchant
vessels stretching back as far as Roman times, and the practice of recording cargo aboard ship in
the ship's log is almost as long-lived as shipping itself, the modern Bill of Lading only came into
use with the growth of international trade in the medieval world.

1.1 A bill of lading (sometimes abbreviated as B/L or BoL) is a document issued by a

carrier which details a shipment of merchandise and gives title of that shipment to a
specified party.

1.2 Bills of Lading are one of three important documents used in international trade to help
guarantee that exporters receive payment and importers receive merchandise.

1.3 A straight Bill of Lading is used when payment has been made in advance of shipment
and requires a carrier to deliver the merchandise to the appropriate party.

1.4 An Order Bill of Lading is used when shipping merchandise prior to payment, requiring a
carrier to deliver the merchandise to the importer, and at the endorsement of the exporter the
carrier may transfer title to the importer.

1.5 Endorsed Order Bill of Lading can be traded as a security or serve as a collateral against
debt obligations.

1.6 It is a receipt for goods placed on board, (or to be placed on board) a vessel, signed by
Master, or any other duly authorized person on behalf of the ship owner.

2.0 FUNCTIONS OF A BILL OF LADING:

2.1 EVIDENCE of Contract of Carriage : It sets out the terms of the contract of carriage in
writing but is not the actual contract itself, the contract having been made earlier by offering of
cargo for shipment by the shipper and acceptance of that cargo by the ship owner. The
preliminary contract will be acknowledged by both the shipper and carrier to incorporate the
carrier's standard terms of business.

2.2 RECEIPT for Cargo : The principal use of the bill of lading is as a receipt issued by the
carrier once the goods have been loaded onto the vessel. This receipt can be used as proof of
shipment for customs and insurance purposes, and also as commercial proof of completing a
contractual obligation.

2.3 Document of Title to the Goods : It is a title of the document shipped on board a vessel
without which delivery of goods cannot normally be obtained.

39
2.4 Quasi-Negotiable Instrument (Partially negotiable) : It is a commercially quasi-
negotiable document enabling transference of goods by endorsement and/or delivery. It is only
negotiations of the documents.

3.0 There are different types of Bills of Lading:

3.1 Straight Bill of Lading: This is typically used when shipping to a customer. The "Straight
Bill of Lading" is for shipping items that have already been paid for. These bills of lading are
generally not negotiated and these are generally for a named buyer and or between companies
which form a part of a global group e.g. P&G India to P&G UK.

3.2 To Order Bill of Lading: Used for shipments when payment is not made in advance. This
can be shipping to one of your distributors or a customer on terms. Under Letter of Credit,
generally the Bill of lading would be to the order of a Bank.

3.3 Clean Bill of Lading: A Clean Bill of Lading is simply a BOL that the shipping carrier has to
sign off on saying that when the packages were loaded they were in good condition. If the
packages are damaged or the cargo is marred in some way (rusted metal, stained paper, etc.),
they will need issue a "Soiled Bill of Landing" or a "Foul Bill of Landing." or a "Dirty Bill of Landing."

3.4 Inland Bill of Lading: This allows the shipping carrier to ship cargo, by road or rail, across
domestic land, but not overseas.

3.5 Ocean Bill of Lading: Ocean Bills of Lading allows the shipper to transport the cargo
overseas, nationally or internationally.

3.6 Through Bill of Lading: Through Bills of Lading are a little more complex than most BOLs.
It allows for the shipping carrier to pass the cargo through several different modes of
transportation and/or several different distribution centers. This Bill of Landing needs to include
an Inland Bill of Landing and/or an Ocean Bill of Landing depending on its final destination.

3.7 Multimodal/Combined Transport Bill of Lading: This is a type of Through Bill of Lading
that involves a minimum of two different modes of transport, land or ocean. The modes of
transportation can be anything from freight boat to air. Most of the carriers nowadays offer a
bill of lading which is either a Combined transport document of a Multimodal transport
document.

3.8 Direct Bill of Lading: Use a Direct Bill of Lading when you know the same vessel that
picked up the cargo will deliver it to its final destination. These are used only for direct ports of
calls. However nowadays the significance of Direct Bills of Lading are fading.

3.9 Stale Bill of Lading: Occasionally in cases of short-over-seas cargo transportation, eg:
Sailing between Nhavasheva to Jebel Ali where the transit time is just about 3 days, the cargo
arrives to port before the Bill of Lading. When that happens, the Bill of Lading is then termed as
"stale."

3.10 Shipped On Board Bill of Lading (SOB): A Shipped On Board Bill of Lading is issued when
the cargo arrives at the port in good, expected condition from the shipping carrier and is then

40
loaded onto the cargo ship for transport overseas. The definition of loaded on board here
indicates the intended stowage position where the cargo was planned for loading.

3.11 Received Bill of Lading (RFS): It is simply a Bill of Lading stating that the cargo has arrived
at the port and is cleared to be loaded on the ship, but has not necessary mean it has been
loaded. Used as a temporary BOL when a ship is late and will be replaced by a Shipped On Board
Bill of Lading when the ship arrives and the cargo is loaded. These RFS Bills of lading are preferred
by exporters who do not engage in letter of credits.

3.12 Claused Bill of Lading: A bill of lading that denotes that merchandise is in good condition
upon being received by the shipping carrier is referred to as a "clean" bill of lading, while a bill of
lading that denotes that merchandise has incurred damage prior to being received by the
shipping carrier would be known as a foul or "claused bill of lading. A claused bill of lading will
have a statement (clause) written onto the bill of lading noting down any damage or other
issues. Letters of credit usually will not allow for foul bills of lading.

3.13 Sea Waybill / Express Bill of Lading: once after completion of customs clearance, the
appointed customs broker can send Shipping instructions to the carrier and they issue one copy
of Bill of Lading and in turn to their counterpart in final destination. Means, an electronic data
copy of ‘express bill of lading’ is sufficient for the carrier in final destination to release the cargo
to final consignee mentioned in the Bill of Lading. After import custom clearance at destination
the buyer approaches the carrier to deliver the cargo to him. The carrier, after verifying the
necessary identity, delivers cargo to the buyer. The Express Bill of Lading cannot be negotiated
and has limitations since Express Release Bill of Lading is not a document of title, the goods
consigned under express release bill of lading cannot be transferred to another buyer.

3.14 Master Bill of Lading: Bill of Lading issued by a carrier is called MBL Master Bill of Lading.
In a master bill of lading, the shipper will be the freight forwarder who delivers the cargo to main
carrier and the consignee, the overseas counterpart party of the freight forwarder who receives
the goods from final shipper provided the involvement of the freight forwarder is present in
issuance of a HBL - House Bill of Lading.

3.15 House Bill of Lading: When your goods have been booked with a freight forwarder by
sea, he as a carrier issues receipts of goods which are called House Bill of Lading (HBL). In turn,
freight forwarder books the cargo with vessel owner and collects Master Bill of Lading (MBL) or
Groupage Bill of Lading. In a Master Bill of Lading, there can be more than one consignment.
Once the cargo reaches at destination, the associate office of freight forwarder delivers cargo to
the final consignee.

3.16 Switch Bill of Lading: A Bill of Lading substituted by a carrier for an original Bill of Lading
in accordance with the terms of a letter of credit. In a back-to-back Letter of Credit, for example,
the original Bill of Lading (which shows the actual supplier as the shipper) is switched with
another Bill of Lading that shows the middleman as the shipper and protects the identity of the
actual supplier. These Bills of lading are generally used in the global trading business of
commodities where the identity of buyer and seller has to be kept discreet for the interests of
the trading houses.

4.0 The contents mentioned on the bill of Lading are as below:

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4.1 Shipper: is the name and address details of the shipper who is shipping the cargo. This
may or may not be the actual owner or manufacturer of the cargo, but could also be a trader or
freight forwarder depending on the type of bill of lading that is issued.

4.2 Consignee: is the name and address details of the consignee who is receiving the cargo
or is the actual buyer. This may or may not be the actual owner or recipient of the cargo as it
could be a bank or trader or forwarder depending on the type of bill of lading that is issue.
However, being named as the consignee on the bill of lading also comes with the risk and
responsibility of being held accountable for many issues such as non-clearance of cargoes, late
clearance, claims etc.

4.3 Notify: is the name and address details of the person who generally should be notified of
the arrival of the cargo. Depending on the bill of lading that is issued this could be the actual
buyer or receiver of the goods, clearing and forwarding agent or the trader. Generally the notice
of cargo arrival is to be sent to this notify part.

4.4 Bill of Lading Number: is the unique number provided to the shipment covered under a
specific bill of lading. This is allocated by the shipping line and must be quoted by the client for
any queries, sailing info, arrival info, claims etc.

4.5 Reference Numbers: this space can be used to update any reference numbers specific to
the client or the freight forwarder which they will use to trace their shipments. Some carriers
input the booking reference number.

4.6 Carriers Agents: here the details of the agents at discharge port is usually recorded by
the shipping line so that the destination agent of the client/forwarder can contact the shipping
lines agents to query the status of the shipment or go for release etc.

4.7 Ocean Vessel/Voyage: This is the name of the vessel and the voyage number that carries
the container or cargo from the (mainland) Port of Loading (example Durban) to the Port of
Discharge (example Mumbai). Remember that the combination of vessel and voyage will be
unique and never repeated (well almost never).

4.8 Pre-Carriage by: Assume that there is an inland point which is connected to the mainland
port by means of a feeder (connecting) vessel, the name of that vessel is shown here. Example –
Maputo to Durban. In some cases if the pre-carriage is by land or rail means that can also be
mentioned here, however this is very rarely displayed here.

4.9 Place of Receipt: This is the place where the cargo is handed over by the shipper or his
agent to the carrier (shipping line). This is very important in terms of the contract of carriage
between the shipper and the shipping line. If this area is filled, it is assumed that the carrier has
done the movement from here to the Port of Loading and if there any incidents, damages etc to
the container or cargo between the Place of Receipt and Port of Loading, the liability will be that
of the carrier. So the shipping line must be careful not to show anything in the Place of Receipt
if they are not actually doing the movement.

4.10 Port of Loading: This is the place from which the container or cargo is loaded by the
carrier onto the nominated Ocean Vessel.

4.11 Port of Discharge: This is the place at which the container or cargo is discharged by the
carrier from the nominated Ocean Vessel.

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4.12 Place of Delivery: This is the final destination of the container or cargo. If this area is filled
(example: ICD Bengaluru), it means that the carrier has undertaken to move the container or
cargo from the Port of Discharge to the Place of Delivery. Again as in the case of Place of Receipt,
the shipping line must be careful when showing anything in this field as then, it will be liable to
deliver the container or cargo in good order and condition to this place of delivery. If there is a
Place of Delivery shown in the B/L, generally the carrier does not allow the client (merchant) to
take delivery of the container or cargo at the Port of Discharge and move it to the Place of
Delivery, reason being that if anything happens to the container or cargo enroute to the Place of
Delivery, the carrier may still be held liable.

4.13 Marks & Number/Container & Seal Number: In this field the details of the container
number and the affixed carrier seal should be mentioned. The seal number plays a very
important role since this is checked by the customs at the destination at the time of delivery.
There cannot be any deviation in terms of the seal number mentioned on the B/L as against the
actual seal number on the container without any authorized supporting document.

4.14 No of Packages & Description of packages: This is a very important field where the
description of the packaging of cargo is mentioned. In Containerized cargo transportation, this is
clearly a description provided by the shipper and is stated on the bill of lading since it would be
STC (Said to Contain) and it would be Shippers Load, Stow & Count (SLSC). On bulk and break-
bulk carriers the master of the vessel could clause the Bills if the case warrants, however
normally the master signs the bill of lading ONLY FOR THE QUANTITY AND NOT THE QUALITY.
Usually the carrier refrains from giving remarks as OLD or USED Car in the description. In case of
dangerous cargo shipments, in the description field the dangerous classification of the cargo is
also mentioned. The type of packaging which mentions clearly whether it is drums, bags, IBC,
etc. are also clearly mentioned.

4.15 Gross Weight in tones: The mention of the gross weight is important in the Bill of lading.
However for commercial purpose, the net weight is also inserted in the same column clearly
differentiating the gross & net weight.

4.16 Measurement (CBM): In case of break-bulk project cargo this field is fully utilized for the
dimensions of the cargo.

4.17 Freight: It is of utmost importance in the BL to mention the terms of payment of freight
whether “Pre-paid or Collect”. Based on this the liners agent at the destination would release
the cargo. In case the freight is marked as collect then the cargo would be released at the
destination only after payment of the freight. There is a mention of another term called as
ELSEWHERE. However please note that this is only the place of payment, Origin or destination
or Elsewhere, whereas on the Bill of Lading the only 2 options mentioned is as follows:
PRE-PAID – Normally paid at Origin - Can be paid at Origin or Destination or
Elsewhere (Third Country)

COLLECT - Normally paid at destination - Can be paid at Origin or Destination or

Elsewhere (Third Country)
4.18 On board Date & Place of issue: The on board date plays a very important role in the
Bill of Lading. This is very much connected with the terms set up in the Letter of Credit. The place
of issue of a Bill of Lading is also mentioned on the Bill of Lading. Usually Month end or Quarter
end shipments are the ones where the Carrier comes under a lot of request from the shipper for
the ON BOARD DATE, specially if the actual vessel sailing is closer to the date of the deadline
mentioned in the Letter of Credit.
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4.19 Bill of Lading Number: Each Bill of lading has a unique identification number either
numeric or a combination of both alpha numeric which clearly differentiates each and every
shipment. No Bill of Lading number is reused for any future consignments. It is unique to every
shipping line / carrier. In containerized shipping involved in LINER TRADE, mostly the Booking
number is the same which eventually becomes the Bill of Lading Number.

There are Terms & Conditions associated with Bills of Lading.

An Example of the CMA CGM Bill of Lading can be found in the link below:
https://www.cma-cgm.com/static/eCommerce/Attachments/CMACGM-Terms-and-Conditions-2016-08.pdf

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5.0 Shipping documents do get lost in transit to consignee or the bank or elsewhere. In case
of such an event happening, it’s not the end of the shipment, but in case of a negotiable bill of
lading is lost, stolen, or destroyed, a few measures can be taken as below:

(a) Place an advertisement in the local press about the “loss” or “nullification” of the
original bill.
(b) A court order may be secured, which advises the carrier (shipping line) to deliver the
goods to the holder of the title of the goods, based on a surety bond given by the entity
claiming the goods, for an amount approved by the court.
(c) The carrier also should receive a Letter of Indemnity indemnifying the carrier or any
person injured by delivery, against liability under the outstanding original bill. The court
also may order payment of reasonable costs and attorney’s fees to the carrier.
(d) Certain lines accept a Letter of Indemnity if it is signed by a bank who would then take
joint liability to return the original bills of lading (if found).

5.1 A Letter of Indemnity issued in lieu of loss of Original Bill of lading generally has wording
as below.

Please note that this is a “generic” format and most lines have their own requirement.

“To the Owners and/or Charterers and/or operators and/or carrier and/or Agents and Masters of M.V.
In consideration of your issuing at my/our request a duplicate set of Bills of Lading for the goods mentioned below, viz.:
Goods: ………………………………………… No. of pkgs.: …………………………………………
Description: ………………………………………… Marks: …………………………………………
Bill of lading or other contract of carriage: …………………..
due to the fact that the original set has been lost I/we hereby agree and undertake to indemnify you and each of you from all consequences of so doing, and I/we
undertake to hold you and each of you harmless and indemnified against any claims, liability, losses, costs, charges, fine damages and expenses (including any kind
of legal expense) arising from in consequence of or in any way connected to anybody claiming delivery of the goods as owner or assignee or as the holder of any Bill
of Lading originally issued for these goods.
1. In this connection I/we especially undertake to hold you and each of you harmless and indemnified against any loss on account of differences in rate of exchange
or depreciation of currency and/or depreciation of value and/or loss caused by currency restrictions or exchange restrictions issued by any authority. Furthermore,
I/we undertake to produce and deliver to you or each of you not only the duplicate set of Bills of Lading, but also all Bills of Lading which were originally issued if
these should later on be found.
2. In the event of any proceedings being commenced against you or any of your servants or agents in connection with the delivery of the goods as aforesaid
to provide you or them from time to time with sufficient funds to defend the same.
3. If the vessel or any other vessel or property belonging to you should be arrested or detained or if the arrest or detention thereof goods as aforesaid to provide you
or them from time to time with sufficient funds to defend the same.
ISSUANCE OF DUPLICATE BILL OF LADING IN CASE ORIGINAL LOST
4. As soon as all original Bills of Lading for the above goods shall have arrived and/or come into our possession, to produce and deliver the same to you whereupon
our liability hereunder shall cease.
5. The liability of each and every person under this indemnity shall be joint and several and shall not be conditional upon your proceeding first against any
person, whether or not such person is party to or liable under this indemnity.
6. This indemnity shall be construed in accordance with English law and each and every person liable under this indemnity shall at you request submit to
the jurisdiction of the High Court of Justice of England. (This clause may be amended to show another jurisdiction where appropriate).
7. Where this indemnity has been joined in and countersigned by a bank, the issuer and the bank shall be jointly and severally liable hereunder.
Signature …………….
We hereby join in the foregoing undertaking:
Signature of the bank …………………”

5.2 However, a few precautions also need to be taken such as:

a) An advertisement about the loss is never a complete defense as regards liability for
wrongful delivery.
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 b) It is merely evidence that the loss occurred and that the original title holder had the
intention of cancelling the original bill of lading issued.
c) Carrier should understand who holds the title to the cargo and issue a duplicate set
only to that entity as there have been cases where the entity that doesn’t hold the
title to the goods has advertised about the loss and has convinced the carrier to
issue second set of originals whereas the first set is still in the hands of its legal
owner and was not actually lost.

6.0 LETTER of INDEMNITY:

6.1 If any packages are found to be damaged or defective when goods are received on a
vessel, the nature of such damage or defects are noted on the bill of lading, and in such cases
the document is said to be "claused" or "foul" or "dirty". The seller of the goods is required to
deliver to the buyer a clean bill of lading in order to satisfy the bank who is negotiating the
documents as per the terms of Letter of Credit.

6.2 It has become customary, when goods are found to be damaged at the time of loading,
for the shipper to give a "Letter of Indemnity" to the carrier in order to secure a "clean"
document.

6.3 This practice is detrimental to the interests of the underwriters because it nullifies to a
certain extent their rights to subrogation. Efforts have been made to make this practice of
issuing clean Bill of Lading against Letter of Indemnity illegal or fraudulent without effect. Many
Courts have held that the practice of issuing clean bill of lading against an indemnity by the
shipper is against public policy and such indemnity exists between the ship owner and the
shipper only. Ship owners cannot claim immunity for claim by the buyer (consignee) of the
goods, and the ship owners are held responsible for the indemnity as per law to the buyer.

6.4 Ship owners may claim indemnity from the shipper for the loss paid to the buyer under
the indemnity.

6.5 There are terms and conditions which are associated with every Bill of Lading.

7.0 The example of highlights of the terms and conditions which feature in a liner bill of lading
are listed below which will be described in detail on the backside of the Bill of Lading.

1. Definitions
2. Carriers Tariff
3. Warranty
4. Sub-contracting and Indemnity
5. Carriers responsibility
6. Time for suit
7. Sundry liability provisions
8. Shipper packed containers
9. Inspection of goods
10. Carriage affected by condition of goods.
11. Description of goods
12. Merchants responsibility
13. ISPS code
14. Freight
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 15. Lien
16. Optional Stowage and Deck cargo
17. Methods and routes of carriage
18. Matters affecting performance
19. Dangerous cargo
20. Notification and delivery
21. FCL Multiple bills of lading
22. General average and Salvage
23. Both to blame collision
24. Validity
25. Jurisdiction

8.0 MULTIMODAL TRANSPORTATION:

8.1 The Multimodal Transportation of Goods Act, 1993 (MMTG) provides for the regulation of
Multimodal Transportation of Goods from any place in India to any place outside India involving two or
more modes of Transport on the basis of a single Multimodal Transport Contract.

8.2 This act came into force from 2.4.1993 and it provides for Registration of a person a Multimodal
Transport operator and Multimodal Transportation can be carried out only by persons registered as MTO
under MMTG Act, 1993. The Director General of Shipping has been notified as the competent authority
to perform functions under the Act including registration of MTOs.

8.3 The MTO registration is valid for period of 1 year and may be renewed for further period of one
year from time to time. The Director General of Shipping has, after obtaining the prior approval of
Ministry of Surface Transport, prescribed the Multimodal Transport Document under Rule 3 of
Multimodal Transport Document Rules, 1994.

9.0 MULTIMODAL TRANSPORT DOCUMENT:

9.1 With the advent of containers, the ocean carriers started extending their services to Inland
locations, as containers, are smoothly and easily handled from one mode of transport to another. One of
the most important ingredients involved in such Multimodal Transport is the existence of a legal regime
to govern the terms of the contract and specify the basis of liability and responsibilities of the Multimodal
Transport Operator. Previously, a document called Combined Transport Document (CTD) was being
issued.

9.2 However, although the format of the document broadly conformed to a specimen prescribed by
the International Chamber of Commerce (ICC), the CTD has not been adopted by all operators uniformly.
Thus, there was an absence of uniformity of liability and other condition.

9.3 In India the Foreign Exchange Dealers Association of India (FEDAI) has evolved its own rules laying
down the responsibilities and liabilities of Combined Transport Operators from the inland container
depots. However, these rules could not obtain wide acceptance mainly because the Combined Transport
Document evolved by FEDAI did not confer negotiability and title to the goods and also because such
documents were required to be exchanged for a regular on-board ocean bill of lading at the port unless
the letter of credit specifically permitted the production of a combined transport Document in place of a
regular Bill of Lading.

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9.4 Looking to the urgent need of Industry and keeping in view the provisions of the Multimodal
Transportation of Goods Act 1993 which is substantially based on the rules framed by the ICC and also
taking into account the provisions of the UN Convention of 1980 on Multimodal Transportation of Goods,
the Director General of Shipping, with the approval of the Govt, has issued an Order on 17th March, 1994
prescribing a model for the Multimodal Transport Document (MTD).

9.5 The document has been prepared for carrying out the provisions of the Act keeping in view the
primary objective of the legislation that the carriers are there to serve trade and not the other way
around.

9.6 The Multimodal Transport Document issued under the present law would be:

1) A contract for the Transportation of Goods by Multimodal Transport.

2) A negotiable document unless it is marked non-negotiable at the option of the
consignor.
3) A document of title on the basis of which its holder can take delivery of the goods
covered by it.

9.7 The concerned parties who would have commercial interest who would be governed by the
document once it is executed would be:

a) The MTO who is the person responsible for the execution of the Multimodal Transport
Contract.
b) The consignor who places the goods in question with the MTD for transporting the
same and the consignee who is to take delivery at the destination.
c) The bankers who would provide the mechanism for documentary credit.
d) The insurers who insure the goods against loss or damage and the liability insurers who
would cover the MTO's liability under contract.

10.0 CONTENTS OF THE Multi Modal Transport Document – GENERAL NATURE

1. The document contains, inter-alia, particulars regarding general nature of goods

2. The name and principal place of business of MTD, the name of the consignor, the name of
the consignee if specified by the consignor
3. The place and date of taking charge of the goods by the MTO
4. The place of delivery of the goods
5. The date or the period of delivery of the goods at the place of delivery.
6. Whether it is negotiable or non-negotiable
7. The place and date of its issue.

10.1 In addition, the standard terms and conditions regarding basis of liability of the MTO for loss or
damage, delay etc. have been incorporated in the document. Relevant particulars contained in the
internationally accepted documents recognized by International Chamber of Commerce have been taken
into consideration while prescribing the document. The MTOs can now issue on a uniform basis
Multimodal Transport Document as a negotiable instrument as per the Multimodal Transportation of
Goods Act, 1993 and the banks will have no difficulty in discounting the bills when such a document is
presented.

oooooo

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 SELF EXAMINATION QUESTIONS

1. List down at least FIVE types of Bill of Lading?

2. List down the three main functions of a Bill of Lading?
3. List down any Five fields contained in the bill of lading?
4. Explain the SOB & RFS bill of Lading?
5. What is an LOI, Describe the circumstance in which a shipper approaches the master
with an LOI?
6. State whether the following is true or false?
 House Bill of Lading is issued by the Freight Forwarder who is a registered MTO.
 Freight terms when to be paid are never mentioned on the Bill of Lading.
 A Bill of lading is not a negotiable instrument.
 A Switch bill of lading is used mainly to evade custom dues of destination
countries.
 In case of loss of B/L, a duplicate set of B/L is issued after paying the requisite
fee and does not require a surety bond

*********************

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SHIPPING PRACTICE FIRST YEAR

LESSON 6
SHIPPING OPERATIONS

1.0 Global shipping operations can be broadly classified under two main headings:

 TRAMP SHIPPING
 LINER SHIPPING

2.0 TRAMP SHIPPING:

2.1 The term is derived from the British meaning of "tramp" as itinerant beggar or vagrant. Tramp
shipping does not have a fixed schedule or published ports of call. They can carry ANYTHING to
ANYWHERE.

2.2 The transport of goods in bulk or in break bulk in a vessel chartered wholly or partly to one or
more shippers on the basis of a voyage or time charter or any other form of contract that non-regularly
scheduled or non-advertised sailings where the freight rates are freely negotiated case by case in
accordance with the conditions of supply and demand.

2.3 The tramp trade first took off in England around the mid 19th century. Within a few years tramp
ships became the workhorses of trade, transporting coal and finished products from English cities to
the rest of the world. The size of tramp ships remained relatively constant from 1900 to 1940, at about
7,000 to 10,000 deadweight tons (dwt.).

2.4 After World War II, economies of scale took over and the size of tramp ships grew to keep up
with a booming supply and demand cycle.

2.5 Tramp trade includes all types of vessels, from Bulk carriers to Tankers. Each can be used for a
specific market. Specialized vessels like Heavy lift carriers are normally involved in the tramp trade.
Tramp ships often carry with them their own gear (booms, cranes, derricks) in case the next port lacks
the proper equipment for loading or discharging cargo.

2.6 The tramp ship is a contract carrier. To generate business, a contract to lease the vessel known
as a charter party is drawn up between the ship owner and the charterer. There are three main types
of charters:

 VOYAGE
 TIME
 DEMISE or BAREBOAT

2.7 Tramp ship owners and tramp ship charterers rely on brokers to find cargoes for their ships to
carry. A broker understands international trade conditions, the movements of goods, market prices
and the availability of the ships adapted to carry that cargo worldwide.

2.8 Sample route of a Tramp Vessel:

 Voy 1: India to South Africa (Ballast)

 Voy 2: Durban to Brazil (Laden)

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  Voy 3: Brazil to Argentina (Ballast)
 Voy 4: Argentina to Chile (Laden)
 Voy 5: Chile to Canada (Laden)
 Voy 6: Canada to USWC (Ballast)
 Voy 7: USWC via Panama to Belgium (Laden)
 Voy 8: Belgium via Suez to Yemen (Laden)
 Voy 9: Yemen to Aqaba (Ballast)
 Voy 10: Aqaba to Australia (Laden)
 Voy 11: Australia to India EC. (Laden)

2.9 The TRAMP CARRIER has the following characteristics features:

1) Tramp carrier is primarily designed to carry the more simple and homogeneous cargo in
huge quantity. It is, therefore, designed to completely utilize its carrying capacity for
carriage of one type of cargo.
2) Since one kind of homogeneous cargo is to be handled, a tramp will have the comparatively
simple equipment. Bulk cargoes are normally loaded and discharged by mechanical
equipment, excavators, pumps, etc.
3) Because of the comparatively low unit value of commodities carried, a tramp will be
operated at the lowest possible cost. This objective can be achieved by operating ships
having relatively less speed by fitting less expensive propelling machinery.
4) A tramp generally carries cargoes of one or two ship users. Hence, loading and discharging
are confined to a few port of calls.
5) Tramp carriers do not have a fixed route and predetermined schedule of departure as it is to
be engaged by one/two users as and when their need arises. This gives greater flexibility.
6) Tramp carrier offers services at terms and conditions, including freight/hire charges, which
are not fixed and given but are negotiable.

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2.10 Below is the list of the cargo commonly carried on TRAMP Ships:

• Minerals & Ores.

• Coal.
• Grain & Agri-produce.
• Fertilizers (Urea).
• Metals in various forms.
• Forest Products.
• Crude Oil.
• Petroleum Liquid Distillates.
• LPG & LNG.
• Vegetable Oils.
• Chemicals.
• Specialized Cargo.

3.0 LINER SHIPPING:

3.1 Liner shipping is the service of transporting goods by means of high-capacity, ocean-going
ships that transit regular routes on fixed schedules. There are approximately over 500 liner services in
operation today, most providing weekly departures from all the ports that each service calls.

3.2 Liner vessels, primarily in the form of containerships and roll-on/roll-off ships, carry about 60
% of the goods by value moved internationally by sea each year.

3.3 Trade between an origin group of countries and a destination group of countries is referred to
as a trade route. Approximately 500 liner shipping services provide regularly scheduled service
between ports along a single trade route or a group of trade routes.

3.4 Liner Shipping is often associated with Multi-modal transport or Intermodal trade.

3.5 Cargo that moves aboard liner ships must be able to move efficiently across land to and from
ports since the most businesses and consumers that are selling and buying goods are located outside
the port area. The continued efficiencies for global trade gained by the use of liner shipping are
dependent upon an inland transportation network that allows for the timely and efficient overland
transfer and transport of cargo.

3.6 Sufficient land-side capacity to keep cargo moving is essential for liner vessels to maintain their
schedules. Supply chains served by liner vessels in 21st century are no longer port-to-port so the
effectiveness of international supply chains is linked to the efficiency inland dispersal of international
cargo that arrived in a country by sea.

3.7 This cargo also has to move via truck or rail on its journey from origin to destination. This
means that international supply chains require an intermodal network. An intermodal network is
comprised of ships, trains, planes, trucks and barges, including the surface over which they move and
the connections or transfer points between the modes, often referred to as intermodal connectors.
Service disruption or insufficient capacity anywhere in the network could result in shipment delays and
increased cost.

4.0 The liner ship has the following features:

1. Liner ship is designed to carry a variety of cargo, with spaces for bales, bundles, boxes,
barrels, drums, etc., as well as for reefer (refrigerated) cargo. The designs of the holds and
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 number of decks in cargo will be different from those of a tramp. With the increased share
of containerized cargo, specially designed container ships for carrying different categories
of containers operate.

2. The cargo handling equipment on a liner will be varied and sophisticated for quick loading
and unloading of cargo to ensure a quick turnaround. A quick turnaround means that the
ship spends the least possible time in the port and most of its time in transit. Most Liner
Ships are Containerized and are served by dedicated container terminals across the world.

3. Liner ships frequently operate between fixed ports and normally loads in several ports.
It serves a number of discharging ports along a pre-determined route.

4. In order to ensure speedier carriage, liner ship is fitted with high powered propelling
machinery.

5. Liner shipping service provides pre-announced scheduled services on given terms and
conditions of carriage. These conditions in the receipt mostly relate to the responsibilities
and liabilities of the shipowners, carriage, and delivery of cargo.

6. Liner shipping generally offers carriage on fixed and stable freight rates.

4.1 Liner shipping could lay claim to being the world's first truly global industry. Likewise it could
claim to be the industry which, more than any other makes it possible for a truly global economy to
work. It connects countries, markets, businesses and people, allowing them to buy and sell goods on
a scale not previously possible.

4.2 As consumers, we have become used to seeing goods from all parts of the globe readily
available in the stores we visit. The reality is that the needs of a rapidly growing world population can
only be met by transporting goods and resources between countries.

4.3 The liner shipping industry has made this process more efficient and changed the shape of the
world economy. This benefits consumers by creating choice, boosting economies and creating
employment.

4.4 Costs for the consumer are kept down and efficiencies are improved and this in turn minimizes
impact on the environment as well.

4.5 It contributes hundreds of billions of dollars to the global economy annually thereby increasing
GDP in countries throughout the world. Moreover, as the lifeblood of global economic vitality, ocean
shipping contributes significantly to international stability and security.

4.6 LINER SHIPPING is responsible for millions of existing jobs and plays a crucial role in stimulating
new jobs.

5.0 Liner Shipping – Efficiency:

• Most efficient mode of transport for goods.

• In one year, a single large containership might carry over 200,000 container loads of cargo.
While individual ships vary in size and carrying capacity, many container ships can
transport up to 18,000 containers of goods and products on a single voyage.
• Similarly, on a single voyage, some car carrier ships can handle 7,600 cars.

61
5.1 It would require hundreds of freight aircraft, many miles of rail cars, and fleets of trucks to
carry the goods that can fit on one large liner ship.

6.0 LINER SHIPPING broadly categorized as below:

 END to END SERVICE

 PENDULUM SERVICE
 ROUND THE WORLD SERVICE

7.0 MARKETING SERVICES OF LINER SHIPPING

7.1 INTRODUCTION:

7.1.1 Marketing means selling or buying of goods or services. However, in shipping the term
marketing refers only to the aspect of selling and possibly implies something more than the simple act
of selling. Here, the terminology means the service of transportation of seaborne goods and hence
marketing in the context of shipping refers to the selling of shipping space (or slots as the case may
be) and other co-related activities.

7.1.2 In marketing, the four most important parameters are usually expressed by four Ps i.e.,
product, price, place and promotion. To induce a buyer to pay for a service, he must be convinced
that:-

(a) The service is available, reliable and dependable.

(b) The service is reasonably priced.
(c) The service is available at the right time at the right place.
(d) Awareness of the service has been created through promotion.
62
7.1.3 The main features in shipping services consist of:-

(i) Regularity of service at frequent intervals and quick transit time to port of destination
on regular basis.
(ii) Pre-determined scheduling of routes assuring regular coverage of a wide range of
ports.
(iii) Adequacy of service in terms of quality and quantity providing for over-length or odd-
shaped cargoes, special cargoes like reefer, etc; ability to meet shippers' demands to
cover particular ports either by direct sailing or safe transshipment at reasonable costs.

7.1.4 The price in shipping service is the freight that the customer pays for carriage of his
consignment and obviously in today's shipping market unless the freight rate is competitive and
reasonable no exporter or importer would be willing to use that particular shipping line. Promotion in
shipping service refers to the publicity efforts of a shipping line through advertisements in journals,
newspapers, shipping dailies, coupled with contacts developed through E-mails, Trade fairs and
personal visits.

7.2 Marketing:

7.2.1 The executive must be fully conversant with the trade and ports on the route that he
handles. He must undertake market research, hold constant dialogue with shippers, consignees,
concerned authorities and should make use of all relevant shipping publications.

7.2.2 The executive must keep a very close watch on the competitive lines, activities and their
policies in order to be aware of the changing needs of the local trades.

7.3 Announcing Sailings:

7.3.1 It is the duty of the executive to keep the customers well informed about the scheduling of his
line, particular vessel's itinerary, etc. For this he must keep in close touch with the agents all over the
world and pass on relevant information to the local clients. Circular letters of the vessel's schedule i.e.
likely arrival, export--opening and closing--date, sailing date from the concerned port, also at other
ports of loading/destination as well as vessel's particulars, i.e., vessel's flag, loading gear, capacity to
carry special cargoes such as heavy-lift containers, refrigerated cargoes, etc.

7.4. Canvassing and Booking Cargo:

7.4.1 An essential function of the marketing executive in a shipping line is to secure sufficient cargo
to fill up the allotted space/slots of the vessel and to achieve this end, he must develop a very friendly
relationship with all important customers. The clients must be given an impression of being cared for
constantly and looked after by being closely appraised of improvement/changes in services and
policies. If he finds that the bookings of a particular shipper/buyer are going to some other competing
line, then it would be his responsibility to analyse the reasons, through discussions with the client and
through market intelligence in respect of competitor's service, policy, etc., so that the marketing
executive is in a better position to compete for future business.

7.5 Quotation of Freight:

7.5.1 The marketing executive must keep all the tariffs, covering the trade that he deals with,
updated through regular contacts with conferences. Since liner tariff is quite often complicated,
through provisions of adjustments and surcharges, it is his duty to ensure that tariff rate is not only
quoted correctly but is also explained to the shippers and consignees.

63
7.5.2 A shipping executive is also expected to provide certain after-sales service. The basic after-
sales service provided by a marketing executive in shipping starts from the time the consignment is
tendered by the exporter for shipment. Accurate information about loading and the issuance of the
bill of lading in time will make the clients more responsive and they will look towards him for all their
problems. So it is important for marketing executive to keep liaison with the liner officer and the freight
department of his company.

7.6 The next phase of after-sales service starts after the shipment has taken place on board the
vessel. The shipper would look towards the marketing executive for all information connected with
whereabouts of the carrying vessel, its ETA at destination port and the position and condition of
consignment till it is finally delivered to the consignee. This work has become further complicated with
the advent of containerization, where quite often the responsibility of the carrier does not cease at
the discharging port but continues right up to the consignee's warehouse. Hence it becomes essential
for the marketing executive to keep track of the containers and their movements to be able to keep
the shippers/consignees well informed.

7.7 The marketing executive is required to:

(a) Detect any major shift that may have taken place in the market in terms of shipper's
preference or movement of a particular commodity and ascertaining reasons for the same.
(b) Gauge the impact of the measures taken by the line and by competitors, on the market
share of the line vis-à-vis the competing lines.
(c) Forecast future potentials and trend of the market.
(d) Various government policies which govern the Currency exchange rate an also regulation
of exports of certain commodities.

7.7.1 The market research activities include in general the determination of market characteristics,
measurement of market share and market potential, cargo mix analysis, studies of trade trends,
competitors' strategies, short and long range forecasting, etc.

7.7.2 It is better to have a separate marketing wing which should work independently but in close
co-operation with the line managers, instead of by covering the aspect of marketing by the line officers
themselves.

7.8 The above concept is not applicable to marketing in tramp or bulk shipping. In bulk shipping,
the most characteristic difference lies possibly in its speculative nature, for which strict secrecy is
maintained of the vessels' position. Most of the tramp charters are fixed through shipbrokers.
oooooo

SELF EXAMINATION QUESTIONS

1. How would you explain the concept of marketing in liner shipping?
2. Describe the various functions of sales and marketing officers in a shipping organization.
3. In your opinion what are the essential qualities of a successful marketing executive?
4. With relevance to shipping, write short notes on:
(a) Parameters of marketing.
(b) After-sales service.
(c) Importance of public relations.
(d) Significance of market research.

RECOMMENDED BOOKS FOR READING:

1. Economics of Shipping Practice & Management -- A. E. Branch, 2nd Ed., 1986.
2. Elements of Shipping -- A. E. Branch, 7th Ed., 1996.
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64
SHIPPING PRACTICE FIRST YEAR
LESSON 7

INTRODUCTION TO CHARTERING
1.0 CHARTERING BACKGROUND:
1.1 It was in about 1870 that technical improvements in sea transport brought about a worldwide
trading network and made it possible for whole regions to specialize in a single commodity for export.
The comparative modern system of international exchange and specialization was made possible by the
advent of steamship which enabled merchants to maintain regular schedules and in turn to make business
less speculative and more a matter of supply and demand. The technological advancement and
improvement made in the types of ships and economy in propulsion contributed to the development of
world trade and also in the pattern of international sea transport.

1.2 The vessels plying on a regular scheduled service between groups of ports and with the
emergence of tween deckers and subsequently container vessels (as also passenger vessels) were termed
as "Liners". The vessels not operating on a fixed sailing schedules were termed as "Tramps" since they,
as the term implies, trade in all parts of the world in search of cargo, primarily bulk cargo.

1.3 As international trade increased more sea routes were opened up and through efficiency brought
about a quicker turn-around of ships. The "Liner" operators in order to maintain a regular sailing schedule
had to resort to chartering ships as and when their own ships were not available as required by the pre-
announced schedules. The "Tramp" trade, on the other hand, had to cope up with the situation arising
out of industrialization and export trade of individual bulk commodities. In order to make the
commitments for export in time, the cargo owners or the traders of bulk commodities resorted to
chartering ships required at a particular port in a particular period of time as dictated by their
commitments. Today, a very large proportion of the world's trade is carried in tramp ships' one
commodity filling up the whole ship. The commodities in tramp trade are coal, ores and concentrates,
sulphur, cement, phosphate, scrap, steel, etc., required to keep the wheels of industries moving, as also
essential commodities like grains and fertilizers.

1.4 The contract of carriage of goods by sea in tramp ships (or the Contract of Affreightment, as it is
generally called for any contract by sea) is usually, but not exclusively, contained in a document called the
"Charter Party". Several international shipping organisations devised standard Charter Party Forms for
the particular trade or specific types of charters. The purpose is to standardise a number of clauses
frequently used but varying in different trades.

1.5 The parties involved in a charter deal are, on the one hand, one who owns or operates a ship
(owner or carrier) and, on the other hand, one who has goods to be carried by sea (charterer). The owner
of the cargo (the shipper or the consignee) is frequently also the charterer. Both parties normally
negotiate through the intermediary called the shipbroker. Chartering negotiations are carried out day out
day and night and nearly always under pressure of time and frequently even concluded in a single day.

1.6 In the early days of chartering, the ships were chartered on a voyage basis, that is, the ship was
chartered to carry a full shipload or a specified quantity of cargo from one port to another port for a
consideration terms as "freight". This type of charter is called Voyage Charter. Subsequently, another
type of charter known as Time Charter came into being in which the ship as a functioning operating unit
was given on hire for a period of time, the consideration payable on time basis by charterer to owner
being termed as Charter Hire and the ship traded during the charter period as per the wishes of the
charterer. The charterer acting in the capacity of a "carrier" is called a disponent owner.

65
2.0 CONTRACT OF AFFREIGHTMENT:
2.1 An agreement by a shipowner to carry goods by water, or to furnish a ship for the purpose of so
carrying goods in return for a sum of money - called freight (or hire) paid to him. This definition is a general
definition of any contract of transport of goods by water but this term has acquired specific meaning in
modern shipping.

3.0 SPECIFIC MEANING OF COA:

3.1 One such type is the so-called Contract of Affreightmernt (COA) which term is now used
specifically (as distinct from the general legal definition given hereinbefore), where a shipowner makes
an agreement with a charterer to carry for the charterer a large quantity of goods between certain ports
during a specific period. It may be quantity contract. In order to fulfil his commitments under the
contract, the shipowner may use one or more of his vessels on consecutive voyages on almost continuous
basis which in its regularity is similar to liner traffic. Shipowner may, depending on the basis of contract
of affreightment fill up the unused space, if possible, by additional cargoes or carry cargo in the return
voyage instead of ballasting to the loading port empty.

4.0 CHARTERPARTY:
4.1 A charter party is a contract whereby a shipowner agrees to place a ship, or part of it, at the
disposal of a merchant or other person (known as the charterer), for the carriage of goods from one port
or ports to another port or to ports on being paid freight or to let his ship for a specified period, the
remuneration then being known as hire. The terms, conditions and exceptions, under which the goods
are carried are set out in the charter party.

4.2 The charterer may supply the cargo himself or enter into sub-contracts of carriage with other
shippers who provide all or a part of the cargo or to employ the ship as a general ship i.e. a ship put up
for a particular voyage to carry the goods of any persons willing to ship the goods on her for that voyage.

4.3 After the goods are shipped, a bill of lading is issued, which serves as a receipt by the shipowner.
The bill of lading issued pursuant to a charter party has implications different from the one issued for
cargo shipped on a liner ship. This aspect will be taken up later.

5.0 BASIC CLASSIFICATION OF OCEAN TRAFFIC:

5.1 There are various modes of Ocean Traffic and one may choose to describe the Ocean Traffic from
vessel agencies. However, the most important distinction one finds in practice is between liner service
and chartering (tramp shipping, chartering in the open market or free traffic), since these reflect basically
different business ideas.

5.2 Liner Traffic is carried out on a regular basis, where the shipowner, eventually in conjunction with
another shipowner maintains a regular service between nominated ports. The freight rates applicable are
in accordance with the tariffs announced beforehand, and are not negotiated individually. There,
however, may exist rebate systems for regular customers mostly also termed as a VIS (Volume Incentive
Scheme). In liner operation, the shipowner normally arranges and pays for loading and discharging. The
documents used are the booking note (B/N) and the Bill of Lading (B/L).

5.3 Vessel engaged in tramp shipping will seek cargo in the open market, preferably in the port/area
in which it is becoming free of the previous cargo or in the port/area, where cargo is available. It may be,
therefore, necessary to ballast the ship empty to load the next cargo, which is usually a single commodity.

66
5.4 The documents used in chartering are basically Charter Party (C/P) (or sometimes Fixture Note
(F/N) and Bill of Lading (B/L) issued pursuant to a charter party. The vessel operating as a "Tramp" may
be chartered by a liner operator, who may need the vessel in order to maintain the regularity of the pre-
announced liner schedule or employ her in his liner business, when there is a large quantity of cargo
available. On the other hand, if there is not sufficient quantity of cargo available, a vessel intended for
and normally used in liner business may be offered and "worked" in the open market. The additional
distinction between liner traffic and tramp shipping is still important, but it may be nowadays less clear
than before as a result of several forms of contracts that have come into used.

5.5 In tanker operation, in particular we may find that large oil companies own several vessels and
are also important charterer.

5.6 It may not be out of place to mention that in modern shipping management agreements have
come into being and becoming more and more common. In such agreements, manager may be entrusted
to provide service and/or know how and also entrusted with the duty of operating and finding
employment for the vessel, as if he were the shipowner, for the account of the actual owner.

5.7 We may summarize the above as follows:

BASIC QUALIFICATION OF SHIPPING TRAFFIC

Liner Chartering (Tramp)

Regular service between nominated ports Operating in open market seeking cargo
wherever available.

Freight rates in accordance with tariff. Freight rates negotiated between shipowner
and charterer.

B/N and B/L used. C/P and B/L issued pursuant to a C/P used.

Loading and discharging normally arranged and Loading and discharging arranged and paid for
paid for by the Cargo Owner. by shipowner and/or charterers, as per the
terms of the C/P.

6.0 Main Classification of Chartering/Charter Markets:

6.1 Although chartering can be classified on the basis of various charter markets, presently we shall
restrict the discussion in the lessons to follow two main types mentioned below:

(a) Dry Bulk Chartering: Comprises of grains, ores, coal and others.

(b) Liquid Bulk Chartering: Comprises of crude oil, petroleum products (clean and dirty),
chemicals, chemical parcels.

6.2 Chartering and the charter parties used in these two main trades differ in many respects. Whilst
there are many charterers, small and big in the dry cargo trades, each having special standard forms,
charterers in the tanker trade being mainly large oil companies have their own forms. There could be,
therefore, lengthy negotiations on the details of a dry cargo charter party after main terms are fixed, in
tanker trade, the scope of extensive negotiations on the details is negligible or rather nil while working
with the major oil charterers.

6.3 Contracts of Affreightments (COA) may have characteristics of tramp and liner operations.
67
7.0 TYPES OF CHARTER PARTY
7.1 A fair deal, giving a reasonable rate and conditions to both shipper and ship owner, ought to be
the consequence of a properly arranged fixture, using documents that have been carefully thought out to
provide for this equity between the parties.

7.2 An important role for BIMCO, which has been important in this field for nearly a century, is in the
development of fair and balanced charter parties.

7.3 There are many different types of charter.

(a) Voyage Charter; (b) Time Charter; (C) Bareboat Charter; (d) Contract of affreightment

8.0 VOYAGE CHARTER PARTY

• The ship provides transport for a specific cargo between a loading port and a discharge port.

• The terms will specify a rate per tonne.

• The charter party will usually set out the dates for the ship's arrival at the POL, estimated time
for loading and discharge and for the voyage itself, the speed of the ship being known.

• Variations because of heavy weather on the voyage, port congestion or berths not being
available, or if the ship undertakes the operation faster than had been provided, then there
are adjustments which will be provided for.

• Preferred by the Brokers since profit margins are relatively higher.

• The ship owner is reimbursed by freight money paid either on a lump sum basis or in relation
to the actual cargo quantity carried.

• Although tramp ships are commonly employed for one voyage at a time, seeking new
employment to follow discharge of a current cargo, it sometimes happens that such vessels
are engaged for a series of voyages under one head charterparty - termed consecutive
voyages.

• In such cases, however, each voyage is considered separately in respect of freights earned.

• This is termed as Consecutive Voyage Charter.

• Commonly used forms are either GENCON or SHELLVOY.

9.0 TIME CHARTER

• Another common form of agreement, with the owner of the ship operating his ship as
instructed by the charterer between certain agreed dates for an agreed daily or monthly rate.

• During this period, it will be the charterer who will pay for the running costs of the ship such
as the fuel and insurance. Crew and other maintenance costs continue to be on the ship
owner.

• Commonly used forms are the BALTIME or NYPE or SHELLTIME for Tankers.

• Not preferred by the brokers since their profit margins are relatively less.

68
10.0 BAREBOAT CHARTER
• A more long term agreement is what is known as a "bareboat" charter where the owner of
the ship effectively hands the operation of that vessel to a charterer, who will then operate
the ship during the agreed period as if he owned it, like a shore side leasing agreement.

• The charterer will be responsible for the repairs and running costs, the crewing and
insurance, and he may even paint the ship in his company's own colours.

• Even the flag can be decided by the Charterer.

• Time period for a bareboat charter is relatively higher.

11.0 CONTRACT OF AFFREIGHTMENT

 COA is a convenient way of operating for a charter who has a large quantity of cargo to
move over time and involving many voyages.

• Under this agreement, the owner will agree to carry the cargo for an agreed price per tonne
and usually specify to deliver a certain tonnage per month, or per voyage.

• "Industrial" cargoes such as coal or iron ore are often shipped under contracts of
affreightment, with the owners agreeing to carry, say 100,000 tons per month, from South
Africa to Rotterdam, but within these constraints, leaving the ship owners free to arrange
their ships to fulfill this contract.

12.0 TRAMP SHIPPING – CONTRACTS & FREIGHT

• The pricing is fully governed by the law of supply and demand.

• Ships are chartered under different terms and conditions, including single voyage or
consecutive voyage charters, contracts of affreightment, period or time charter, tripcharter,
or bareboat charter.

• The charter rates are quoted on a competitive basis through brokers in various exchanges
throughout the world.

• The composition of the charter rates are of Capital costs, Voyage costs, Operating costs &
Cargo handling costs.

13.0 The major elements which influence the fixing of a freight rates:

• Ship specification & Age

• Type of Cargo & Quantity of cargo

• Trade and route

• General market conditions

• Terms of charter party, i.e distribution of costs between ship-owner and charterer.

• Duration of charter

• Urgency of the charter

• Convenience of the charter to deal with the ship-owner.

69
 • Several indices are available to keep track of rate fixing in the international dry bulk
markets, such as the Baltic Freight Index (BFI) which is determined by an expert group and
published daily by the London-based Baltic Exchange.

14.0 Charter parties are an essential tool for sea trading. It assists in avoidance of disputes between
the two parties that are involved. They can be tailored to virtually every kind of trade or ship-type.

15.0 BIMCO plays a very important role in designing various charter parties and also the guarantee.

16.0 BIMCO (Baltic & International Maritime Council):

16.1 BIMCO is a shipping association providing a wide range of services to its global membership of
stakeholders who have vested interests in the shipping industry, including shipowners, operators,
managers, brokers and agents.

16.2 Objective is to facilitate the commercial operations of its membership by developing standard
contracts and clauses, providing quality information, advice, and education. BIMCO promotes fair
business practices, free trade and open access to markets and is a strong advocate for the harmonization
and standardization of all shipping related activity.

16.3 BIMCO is accredited as a Non-Governmental Organization (NGO) with all relevant United Nations
agencies and other regulatory entities, BIMCO actively promotes the application of international agreed
regulatory instruments. It has become increasingly common under a time charter for the owners to
require the charterers to provide a written guarantee underwriting their obligations to pay the owners
for all sums due under the agreement.

16.4 Such guarantees are typically issued by a parent company. A guarantee should provide owners
with a greater degree of security.

16.5 To help avoid the pitfalls of a poorly worded guarantee, BIMCO has developed a new standard
document that provides a clearly worded and comprehensive guarantee of the charterer’s obligations to
pay all sums due under the charter party.

16.6 The BIMCO CPG extends beyond payments due to the owners by the charterers by also
incorporating a guarantee for charterers’ liabilities for items such as unpaid bunkers, port charges and
stevedoring costs that the owners may find themselves liable for if the charterers default on payment.

16.7 BIMCO has developed a large number of standalone clauses to supplement the standard
contracts.

16.8 Examples of some of these standalone clauses are listed below for ready reference:
1. 2020 Marine Fuel Sulphur Content Clause for Time Charter Parties
2. Bunker Price Adjustment Clause
3. Calcutta - Sandheads Clauses
4. Cargo Handling Gear Clause
5. Delivery and Re-delivery Surveys Clause
6. Dunnage Removal Clause for Time Charter Parties
7. Electronic Bills of lading Clause
8. General Average Clause
9. Ice Clause for Voyage Charter Parties & Time Charter Parties.
10. Loading and Discharging with Grabs
11. Piracy Clause for Time Charter Parties 2013
12. Seaway and Great Lakes Trading Clause
13. Slow Steaming Clause for Time Charter Parties
14. Stowaways Clause for Time Charter Parties 2009
15. War Risks Clause for Time Chartering (CONWARTIME 2013)
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16.9 Numerous charter party forms are in use for different trades and purposes. The use of an “off-
the-shelf” form which has been carefully drafted, amended and improved over the years to avoid legal
pitfalls is generally preferred by brokers and shipping practitioners to creating a totally new document for
an individual charter.

16.10 Many forms have more than one edition, having been amended and improved over the years.
Brokers may still use an older version, however, in preference to a newer version that has not gained their
confidence.

16.11 These forms are made separately for VOYAGE CHARTER and TIME CHARTER parties. Below in the
table you would find some of the commonly used forms with details on the following:

 CODENAME
 TRADE for which they are commonly used or Commodities
 Remarks if any such as the version or preferred by which party.

VOYAGE CHARTER PARTY CODE FORMS

CODENAME TRADE REMARKS
AFRICANPHOS Moroccan Phosphates Charterer's Form
AMWELSH Coal Americanized Welsh coal C/P. Widely used.
ASBATANKVOY Tanker American Form
AUSTWHEAT Australian wheat Australian Wheat Board form.
BEEPEEVOY Tanker BP form, used by many companies.
CHEMTANKVOY Chemicals BIMCO form. Boxed layout.
CRUISEVOY Cruising BIMCO form for cruise ship charter
C”ORE”7 Iron ore Mediterranean Iron Ore C/P
FERTIVOY Fertilizers All Origins
GENCON General Purpose BIMCO form. 1922, 1976 and 1994 revisions.
GRAINVOY Grain Bimco Form
INTERTANKVOY Tanker Tanker Intertanko form, used by independent owners.
NORGRAIN Grain North American grain American form.
NUBALTWOOD Timber Used in Baltic Trade
OREVOY Iron ore BIMCO form with boxed layout.
SHELLVOY Tanker Shell form, used by many companies.

TIME CHARTER PARTY CODE FORMS

CODENAME TRADE REMARKS
Dry cargo tramp or
ASBATIME liner American form.
Dry cargo tramp or
BALTIME liner BIMCO form. Boxed layout. Popular in short sea trades.
BEEPEESUPPLYTIME Offshore service BP form. Commonly used by others.
BEEPEETIME Tanker Widely used BP form with various versions.
Designed to replace BALTIME 1939 and LINERTIME, and as an
GENTIME 1999 Dry cargo or container alternative to NYPE.
INTERTANKTIME Tanker Intertanko form. Used by independent owners.
LINERTIME Dry cargo Liner BIMCO form. Boxed layout.
NEW YORK PRODUCE Most commonly used time C/P form. 1946 version more
EXCHANGE (NYPE) Dry cargo liner popular than 1993 version.
SHELL VESSEL TIME Offshore service Shell form. 1986 revision of SHELL SUPPLY.
SHELLTIME Tanker Shell form, but widely used. Various versions.
SUPPLYTIME Offshore supply BIMCO form.
TEXACOTIME Tanker Texaco form. Various versions.
LPG, Ammonia and
Liquefied
Petrochemical Gas
GASVOY Trades BIMCO form.
ooooo
71
 SELF-EXAMINATION QUESTIONS

1. What is a charterparty? Define it.

2. What is the basic classification of ocean traffic?

3. What are the main features of liner and tramp shipping?

4. What is a contract of affreightment and what form has it taken in modern shipping?

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72
SHIPPING PRACTICE FIRST YEAR

LESSON 8
PORT OPERATIONS

1.0 LIGHT HOUSE:

1.1 A lighthouse is a tower, building, or other type of structure designed to emit light from a system
of lamps and lenses and to serve as a navigational aid for maritime pilots at sea or on inland waterways.

1.2 Lighthouses mark dangerous coastlines, hazardous shoals, reefs, rocks and safe entries to
harbors. They also assist in aerial navigation. Once widely used, the number of operational lighthouses
has declined due to the expense of maintenance and use of electronic navigational systems.

1.3 The Directorate General of Lighthouses and Lightships is a subordinate office under the Ministry
of Shipping. It provides General Aids to Marine Navigation along the Indian coast. The Headquarters of
the Directorate is at Noida (U.P.). For administrative control the entire coastline has been divided into
Nine Districts having their regional headquarters at Gandhidham, Jamnagar, Mumbai, Goa, Cochin,
Chennai, Visakhapatnam, Kolkata and Port Blair. The Objective of DGLL is to provide safe and secure
navigation in the Indian waters.

1.4 For the safe voyage in Indian waters, the Directorate has provided aids to marine navigation. They
can be categorized as visual and radio Aids. The visual aids are LIGHTHOUSES, light vessels, buoys and
beacons. The radio aids are DGPS, RACONs etc. All these aids are passive in nature and not user
interactive.

1.5 For providing these aids, the Directorate collects lightdues in 30 days at the rate of Rs.8/- per ton
NT basis from all foreign going vessels calling at/departing from Indian ports. Customs Department
collects light dues behalf of the Directorate.

2.0 APPROACH CHANNEL:

2.1 Ports across the world consists of DOCKS, TURNING BASINS which are well protected from the
weather and currents. These ports which could be protected by a breakwater or the ports which are
upriver in an estuary could also be prone to siltation due to tidal movements. Maintenance of the depth
of water is of primary importance in the Turning basin, at the berth and most important in the approach
to the port.

2.2 Most Ports across the world which deals with regular traffic have a designated APPROACH
CHANNEL which is deep enough to cater to the requirements of the port. The APPROACH CHANNEL is well
defined with ENTRY and EXIT routes for the vessels calling at the ports.

2.3 The Approach channel is well marked and maintained by the respective authorities by signals and
buoyage system and dredged as per requirement for the declared draft by the port. The vessels intending
to use the Approach Channel has to be in constant communication with the ports VTMS (Vessel Traffic
Management System) and follow their instructions when navigating in the channel. Normally the vessel
is assisted by a PILOT when in the approach channel, who is well versed with the local conditions of Wind,
Currents, Tides, Shallow patches etc and assists the master during its transit.

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2.4 The vessels when in an approach channel and navigating in the Traffic separation Schemes are to
navigate with extreme caution as many vessels may converge from different directions on arrival and
diverge on departure from the port.

2.5 Large, deep draft vessels passing each other in the approach channel are to be extremely careful
and must maintain adequate passing distances and proceed at slow speeds keeping in mind the aspect of
interaction between them (suction effect).

3.0 TURNING BASIN:

3.1 A turning basin or swinging basin is a wider body of water, either located at the end of a ship
canal or in a port close to the berth to allow cargo ships to turn and reverse their direction. This is very
important specially in TIDAL PORTS, where due to strong currents, the ship needs to stem the tide for
berthing.

3.2 For a complete 180 degree turnaround, the width/diameter of the basin must be more than the
length of the longest vessel allowed to berth at the port.

3.3 The turning basin is continuously dredged and maintained for the ships to turn either by their own
power or with assistance of anchors or when closer to the pier with assistance of mooring and tide. The
vessels are turned around with the assistance of either Onboard bow thrusters or external tugboats may
assist in maneuvering the ship. Most modern ports to ensure safety of the port insist on the charges of
the TUGBOATS be included in the port dues and tugs depending on the LOA are used for turning around
the vessel in the Turning basin.

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4.0 DRAFT (DRAUGHT) LIMITATION:

4.1 The limitation for a vessel exists while in the proximity to the port areas or while transiting a
channel or CANAL. The limitation could be due to lack of depth of water available which restricts the vessel
to immerse itself beyond the declared draft.

4.2 In commercial ship operations, the ship will usually quote the mean draft as the vessel's draft.
However in navigational situations, the maximum draft, usually the aft draft, will be known on the bridge
and will be shared with the pilot.

4.3 The second type of draft limitation is when it is concerning the AIR DRAFT when the vessel needs
to cross a bridge while entering or leaving a port. Air draft (or air draught) is the distance from the surface
of the water to the highest point on a vessel. This is opposite to the "deep draft" of a vessel which is
measured from the surface of the water to the deepest part of the hull below the surface, but air draft is
expressed as a height, not a depth.

4.4 The vessel's "clearance" is the distance in excess of the air draft which allows a vessel to pass
safely under a bridge or obstacle such as power lines, etc. A bridge's "clearance below" is most often
noted on charts as measured from the surface of the water to the underside of the bridge at Mean Highest
High Water (MHHW) which is the most restrictive clearance. The height of the tide at any time below its
highest point at MHHW will then increase the clearance under the bridge.

5.0 PILOTAGE:

5.1 Pilots with local knowledge have been employed on board ships for centuries to guide vessels into
or out of port safely - or wherever navigation may be considered hazardous, particularly when a
shipmaster is unfamiliar with the area.

5.2 In addition to local knowledge and expertise, pilots are able to provide effective communication
with the shore and with tugs, often in the local language and thereby assisting the MASTER of the vessel
in berthing / unberthing / transit of a vessel.

5.3 Qualified pilots are usually employed by the local port or maritime administration and provide
their services to ships for a fee, calculated in relation to the ship's tonnage, draught, LOA or other criteria.

5.4 The importance of employing qualified pilots in approaches to ports and other areas where
specialized local knowledge is required was formally recognized by IMO in 1968, when the Organization
adopted Assembly resolution A.159(ES.IV) Recommendation on Pilotage. The resolution recommends
Governments organize pilotage services where they would be likely to prove more effective than other
measures and to define the ships and classes of ships for which employment of a pilot would be
mandatory.

5.5 The IMO Assembly in 2003 adopted resolution A.960(23) which includes Recommendations on
training and certification and operational procedures for maritime pilots other than deep-sea pilots.

5.6 Every port has established a designated area where Pilots embark and dis-embark from a vessel.
This is also applicable for CANALS where the vessel use Pilotage services. Every Port has certain detailed
practices that needs to be followed while embarking / disembarking of pilots.

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6.0 Pilot Boarding Requirements:

1. Ensure that the ETA and deepest draft is sent to the Port Control or canal traffic control 24
hours before arrival.
2. Changes in ETA of more than one (1) hour should be amended immediately, and the final ETA
must be confirmed four (4) hours before arrival.
3. Establish V.H.F. contact, V.H.F. Procedure as soon as possible and not less than three (4) hours
before ETA.
4. Rig ladder in accordance with International Regulations, on side advised by Pilot Station
5. Ensure that all pilot ladder equipment is kept in first class condition and to have it inspected
regularly.
6. Ensure that the ladder and manropes are securely made fast. Serious accidents have occurred
through inattention to these matters. Should the equipment and the manner in which it is
rigged not be satisfactory, pilotage services may be withheld.
7. The MASTER of the vessel needs to navigate the vessel to correct boarding ground position
and follow directions given by pilot launch.

7.0 IMPORTANT POINT TO REMEMBER:

THE MASTER OF THE VESSEL HAS TO MAKE A GOOD LEE FOR THE PILOT LAUNCH WITH THE WIND AND
SEA WELL ABAFT THE BEAM ON THE WEATHER SIDE

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 The Pilot Ladder For Embarkation and Disembarkation Of Pilots must be rigged in accordance with
IMO requirements and IMPA recommendations.

8.0 TUG BOATS:

8.1 A tugboat (also called a towboat or simply a tug) is a type of vessel that maneuvers other vessels
by pushing or pulling them either by direct contact or by means of a tow line. Tugs typically move vessels
that either are restricted in their ability to maneuver on their own, such as ships in a crowded harbor or a
narrow canal, or those that cannot move by themselves, such as barges, disabled ships, log rafts, or oil
platforms. Tugboats are powerful for their size and strongly built, and some are ocean-going. Some
tugboats serve as icebreakers or salvage boats. Many tugboats have firefighting monitors, allowing them
to assist in firefighting, especially in harbors. TUG BOATS are of the following types:

1. SEAGOING TUGS
2. HARBOUR TUGS
3. RIVER TUGS

8.2. SEAGOING TUGS (deep-sea tugs or ocean tugboats) fall into four basic categories:

1. The standard seagoing tug with model bow that tows its "payload" on a hawser.
2. The "notch tug" which can be secured in a notch at the stern of a specially designed barge,
effectively making a combination ship.
3. The "integral unit", or "integrated tug and barge" (ITB), comprises specially
designed vessels that lock together in such a rigid and strong method as to be certified as such
by authorities (classification societies). These units stay combined under virtually any sea
conditions and the tugs usually have poor sea-keeping designs for navigation without their
barges attached. Vessels in this category are legally considered to be ships rather than
tugboats and barges must be staffed accordingly.

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 4. "Articulated tug and barge" (ATB) units also utilize mechanical means to connect to their
barges. The tug slips into a notch in the stern and is attached by a hinged connection. ATBs
generally utilize Intercon and Bludworth connecting systems. ATBs are generally staffed as a
large tugboat, with between seven and nine crew members.

8.3 HARBOUR TUGS:

Compared to seagoing Tugboats, harbour tugboats are generally smaller and their width-to-length ratio
is often higher, due to the need for a lower draught. The number of tugboats in a harbour varies with the
harbour infrastructure and the types of tugboats. Things to take into consideration include ships
with/without bow thrusters and forces like wind, current and waves and types of ship (e.g. in some
countries there is a requirement for certain numbers and sizes of tugboats for port operations depending
on the type & size of the ship.

8.4 RIVER TUGS:

River tugs are also referred to as towboats or

pushboats. Their hull designs would make open
ocean operation dangerous. River tugs usually
do not have any significant hawser or winch.
Their hulls feature a flat front or bow to line up
with the rectangular stern of the barge, often
with large pushing knees.

Tugboats are highly maneuverable, and various

propulsion systems have been developed to
increase maneuverability and increase safety.
These propulsion systems are used on tugboats
designed for tasks such as ship docking and
marine construction. Conventional propeller/
rudder configurations are more efficient for port-
to-port towing.

9.0 MOORING OPERATIONS:

9.1 A mooring refers to any permanent structure to which a vessel may be secured. Examples include
quays, wharfs, jetties, piers, anchor buoys, and mooring buoys. A ship is secured to a mooring to forestall
free movement of the ship on the water while the ship is at berth or in a basin.

9.2 The term Mooring originates from the Dutch verb meren (to moor), used in English since the end
of the 15th century.

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9.3 Each vessel has been designed with mooring arrangements such as ropes and wires of
recommended strength can help it moor safely alongside a berth, floating platform, buoy or a jetty.
Fundamentally a vessel has to be positioned alongside a jetty or a berth, between mooring buoys, to a
mooring buoy, to another ship or barge and then made fast using her own anchors, mooring lines or shore
lines.

9.4 Some very common methods of mooring are as below:

1. Mediterranean mooring
2. Baltic mooring
3. Running mooring
4. Standing mooring
5. Spider mooring buoys
6. Single point or single buoy mooring (SPM or SBM)
7. Conventional or multi buoy mooring
8. Ship to Ship Mooring

9.5 While Moored alongside a fixed or floating jetty or a sea berth there are various forces action on
the vessel such as wind, current, tide, wave action, swell, surging induced due to passing ships and trim
of the vessel. The SPRING, BREAST AND HEAD LINES prevent vessel’s movement against the action of
these forces.

9.6 The directional effect of these need not be unidirectional. It can be multi-directional or at various
angles to the vessel. The resultant direction of these forces often changes with change in direction of
onshore/offshore winds or tidal streams, currents upriver and down streams. Thus a combination of
breast ropes, head ropes and spring ropes is the best method to counter these forces and keep the vessel
safely alongside.

9.7 Often mixed moorings are observed as some terminal based on local conditions and experiences
require vessels to use more lines than they are designed for. Thus the method in which wires in
conjunction with soft ropes with different SWL and construction are used as well is termed as Mixed
mooring. The simplified resultant of these forces would tend to move a vessel in transverse or longitudinal
direction with respect to the jetty. Thus spring lines prevent the longitudinal motion and the breast lines
check the transverse motion.

9.8 It is always preferred to avoid mixed moorings due to variable loads and elasticity of various kind
of ropes and wires which lead to different strain or weight on the lines. This can result in excessive loads
on some lines than others and eventually part them putting the vessel in danger. However, for safety
reasons or in a desperate situation shipmasters or pilots may have to resort to mixed moorings.

9.9 Vessels sometimes also use the seaward anchor in conjunction with mooring lines to haul the
vessel out of jetty while casting off or while making fast the vessel alongside use the seaward anchor to
assist the control of the rate of lateral movement towards the berth. This manoeuvre can be carried out
with or without the assistance of tugs.

10.0 SHIP TO SHIP TRANSFER operation involves mooring alongside of two different or same sized
ships for cargo transfer. During this operation either one of the ships is at anchor or both are underway.
The mooring arrangement depends on the size of the ships. A vessel either at anchor or stopped and
maintaining a constant heading is approached by the manoeuvring ship at an angle of approach as smaller
as practicable. The region of approach is usually abaft the beam of the constant heading ship.

10.1 During the approach as the manoeuvring ship comes closer, it steers a course parallel to the
heading or course of the other ship and reduces the horizontal distance between ships to less than 100
metres. Once this state is achieved the maneuvering ship uses engine and rudder movements and reduces
this distance further until the fenders touch each other.

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10.2 The two ships thus then make parallel contact and the lines are passed respectively as per the
mooring plan. As a common practice during the approach the wind and sea are preferred to be from
ahead or at very small angles to the bow.

11.0 Single buoy or single point mooring:

11.1 Often larger ships which cannot approach ports and terminal are berthed outside the port limits
or in sheltered anchorages and the cargo transfer carried out with the help of Single point or single buoy
moorings.

11.2 The basic principle of the buoy is to keep the position of the vessel with respect to the buoy steady
and at the same time allowing vessels to swing to wind and sea.

11.3 Often a tug is provided at the aft to keep the ship at a fixed angle and distance from the buoy. The
buoy is fixed by positioning it in the centre of four or more anchors connected to it. The ship is made fast
to the buoy with the help of a single chain or two which is secured onboard to the bow stopper.

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12.0 Conventional buoy or multi buoy mooring:

12.1 In this method the bow of the ship is secured using both her anchors whereas the stern is secured
to buoy around it. In the approach firstly vessel approaches the final berthing position from forward at an
angle of 90 degrees to her final direction of berthing. The starboard anchor is then let go first at a pre
decided spot while the ship is making headway. Required amount of cable is paid and the astern
propulsion too operated simultaneously to stop the vessel. Once the vessel is stopped in water port
anchor is let go and thus vessel positions her stern along the centerline bifurcating the buoys. For aligning
the vessel along this centerline port cable is paid out and starboard cable heaved in with astern
propulsion. The helm and engines to be carefully used during this maneuver to ensure the stern is
swinging clear of any of the buoys.

12.2 During unberthing the anchor cables are heaved in to move the vessel forward and the weight is
taken on windward lines while casting off other lines to prevent swinging of the stern into the other buoys.
This manoeuvre requires skill and efficient operation of ship’s crew as well as of the mooring equipment
as often weight of the lines can be immense.

13.0 Mediterranean mooring: For this type of mooring, a pre-calculated position is determined and
approached using engine movements. The bow initially is made to cant towards the berth and the
starboard anchor is let go in that positions. After this the engines are run astern and the port anchor is let
go at the designated spot. The vessel falls astern and swings to starboard. Thus vessel is held by both the
anchors as it approaches the quay. Stern lines are then passed. Moorings are kept tight by using the
anchor cables.

13.1 The positioning of vessel is such that mooring is completed with around four shackles on each
anchor. Often tide is used to control drift of the vessel towards quay while positioning it by heaving or
paying out on one of the anchors.

14.0 Running Mooring: This manoeuvre takes relatively short duration compared to Mediterranean
mooring and offers more control of the vessel. The vessel’s starboard anchor is let go at a position
approximately four to five shackles from the final position of the bow and around 9 shackles paid out
while moving ahead on engines. Then as she falls astern with the tide the port anchor is let go and the
starboard anchor is heaved on to five shackles. This method restricts the swinging room and reduces the
load on windlass.

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15.0 Standing Mooring: This is practiced during cross winds. As the vessel is stopped the port anchor
is let go and with the tide around 9 shackles are paid out. The starboard anchor is let go and
simultaneously port anchor heaved on. Thus the port anchor is kept on 4 shackles being generally the
flood anchor and starboard on five as it is the ebb anchor. This vessel takes longer duration and provides
less control over the vessel. The load on windlass is more as compared to running moor.

15.1 The Figure above shows a standard MOORING Arrangement of a Ship at a port with lines passed
to counter various external forces such as wind, current, ships movement in the basin etc. that are
normally faced when vessel is at berth.

15.2 Breastlines provide the bulk of the transverse restraint against off-the- berth forces. Backsprings
provide the largest proportion of the longitudinal restraint. It should be noted that spring lines provide
restraint in two directions, forward and aft, but that only one set of springs will be stressed at any one
time.

15.3 VERY SHORT LENGTHS OF LINE SHOULD BE AVOIDED WHEN POSSIBLE, as such lines will take a
greater proportion of the total load, when movement of the ship occurs. Short lines are also the ones
most seriously affected by “dip”

15.4 Remember, the security of a ship alongside is not something which happens of its own accord. It
needs good knowledge and use of the ship’s equipment, an awareness of good mooring principles, and
careful planning: THIS DOES NOT FINISH ONCE THE SHIP IS FINALLY MOORED BUT CONTINUES ALL THE
TIME SHE IS ALONGSIDE.

15.5 OCIMF publishes a book on Mooring Equipment Guidelines, it includes but not limited to the
following:

 Guidance for the purchasing, testing, management and retirement of mooring lines and tails.
 Tools to help operators manage equipment and lines from design to retirement
 The Line Management Plan and Mooring System Management Plan.
 Information on human factors, berth design and fittings, ship/shore interface and alternative
mooring technology.
 Terminology to describe the strength of mooring lines and equipment & other technical
specifications such as wind and drag coefficients.

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16.0 VTMS – VESSEL TRAFFIC MANAGEMENT SYSTEM:

16.1 The Need of Vessel Traffic System has come up with increase in Maritime Traffic, need for a more
effective system offering higher levels of safety and throughput was felt and accordingly Radar based
Vessel Traffic System was installed and commissioned in various ports and canals or passages with dense
traffic for safe navigation, traffic monitoring and surveillance purposes.

16.2 All vessels when in the range of the VTMS have to follow the standard procedures laid out during
navigating in the VTMS and follow the directions given by the VTMS.

16.3 The Major Features of a VTMS are as follows:

(i) Traffic guidance and control

(ii) Anchorage monitoring
(iii) Ship arrival and departure planning
(iv) Extensive management information
(v) Interface to external port management system
(vi) Support for local hydrographic surveys
(vii) Disaster control and rescue management.

16.4 One of the principal distinguishing features of the system is that it is thought to be the first of its
type to combine a number of major elements, sensors and subsystems within a totally integrated, open
architecture type VTS assembly. The elements comprise the following;

(viii) Three separate VTS control centers with digital wide area network links, each designed for
both independent and joint operations.
(ix) VHF radio communications system.
(x) Radio direction finder system.
(xi) Long range digital video surveillance system.
(xii) Differential GPS transponder system incorporating IALA specification radio transponders.
(xiii) Integrated remote weather sensor system.
(xiv) Mobile hydrographic survey system inclusive of DGPS positioning.
(xv) Simultaneous multi-sensor tracking based on tracking sensors like AIS, GPS & Radio Direction
Finder.
(xvi) Linked and synchronized database management system with displays.
(xvii) Chart-based integrated VTMS operator workstations.
(xviii) Digital communication links (Microwave) between all sensors and control centers.

17.0 Maritime safety and national security are primary concerns for Ports & National
Authorities.

17.1 At Mumbai Port, the Major beneficiaries of the VTMS System are:

(i) Mumbai Port Trust

(ii) Jawaharlal Nehru Port Trust
(iii) Indian Navy
(iv) Coast Guard
(v) Custom Authority
(vi) Coastal Police-Maharashtra State.

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18.0 ANCHORAGE:

18.1 An anchorage is a location at near or closer to port areas where ships can lower anchors. The
locations usually have conditions for safe anchorage in protection from weather conditions, and other
hazards like under water cables, areas of traffic density or approach channel.

18.2 The purpose of anchoring a ship at sea can be for:

(i) Awaiting Pilot for berthing of the vessel.

(ii) Requirement for clearance by any authority prior berthing.
(iii) Taking on cargo (Lightering) or passengers in case insufficient port facilities exist.
(iv) Taking in Supplies for the Ship such as provisions & potable water.
(v) Bunkering operations.

18.3 Some coastlines without port facilities have extensive anchorage locations for lighterage
operations.

18.4 Near the Harbour or closer to the entry and exits of canal where dense traffic is existing, the
admiralty charts are clearly marked with designated anchorage areas which are identified by the local
authorities depending on the purpose that it may serve.

18.5 Anchorages could be of three type broadly:

(i) INNER ANCHORAGE area, for vessels with relatively lower draft or for vessels which needs
to pick up supplies or inspections or who have called at the port for repairs etc. Waiting
time for vessels are relatively shorter.
(ii) OUTER ANCHORAGE area for vessels with relatively deeper drafts and also for vessels
which have a higher waiting period prior their berthing at the port.
(iii) LIGHTERING ANCHORAGE for vessels where exchange of cargo takes place and STS
operations are carried out.

18.6 While vessels are at anchorage, they have to exhibit the LIGHT & SOUND signals as per the
International regulations and also follow local regulations.

19.0 BUNKERING & SUPPLIES:

19.1 Bunkering is the supplying of fuel for use by ships, includes the shipboard logistics of loading fuel
and distributing it among available bunker tanks.

19.2 The term originated in the days of steamships, when the fuel, coal, was stored in
bunkers. Nowadays the term bunker is generally applied to the storage of petroleum products in tanks,
and the practice and business of refueling ships.

19.3 Bunkering operations are located at seaports, and they include the storage of "bunker" (ship)
fuels and the provision of supply of fuel to vessels.

19.4 Vessels either berth at these ports for taking in bunkers (Fuel Oil or Marine Diesel Oil) or remain
at designated anchorage areas which are designated as anchorages for bunkering. In such designated
areas, the bunkering happens via STS (Ship to Ship Transfer) where the required grade of fuel oil is
supplied for the vessel by a tanker vessel commonly called as a BUNKER BARGE.

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19.5 The vessel has to exhibit the required signals as per the International regulations and also follow
local regulations. This is a very crucial operation and a proper record of the entire operation needs to be
maintained in the Deck & Engine Log books.
19.6 The main feature of a port or area to qualify as a MAJOR bunkering HUB is dependent on its
geographical location, proximity to the major international trade lanes, Climatic conditions, Depth
available etc.

19.7 Following are the world's top four major bunkering hubs.

Singapore, Rotterdam, Fujairah and Houston

19.8 Other key global bunkering ports include:

Antwerp, Hong Kong, Gibraltar, Panama and Los Angeles/Long Beach.

19.9 Bunkering procedure is one such operation on a ship which has been the reason for several
accidents in the past. Bunkering on a ship can be of fuel oil, sludge, diesel oil, cargo etc. Bunkering of fuel
or diesel oil requires utmost care and alertness to prevent any kind of fire accident or oil spill.

19.10 Following are different types of bunkers which are supplied to a commercial or passenger vessel:

 Heavy fuel oil bunker.

 Diesel oil bunker.
 Marine Gas oil bunker.
 Lube oil bunker.
 LNG fuel bunker.

19.11 The bunkering procedure on a ship can be divided into three important stages:

1) Preparation– Preparing for the bunkering operation which will involve the readiness of
bunkering equipment, storage tanks and bunkering safety.
2) Perform– Performing the bunkering operation in real time as per the pre-decided procedure
and receiving the marine fuel according to the bunker plan.
3) Wrap-up– Wrapping up the bunkering operation with utmost safety and ensuring the correct
amount and quality of bunker fuel has been received onboard from the bunkering facilities
(bunker ship or shore truck etc.).

19.12 Samples which are collected needs to be adequately labelled and sent for laboratory analysis for
future requirements in case of any contamination of the fuel is experienced.

19.13 The Other general supplies of a ship are supplied when a ship stops over for bunkering enroute.
These supplies could be provisions or Ship Spares etc. which are required during the voyage.

19.14 Proper liaison needs to be done with the local Agent prior, during and after the above process of
BUNKERING & SUPPLIES by the ships Master.

ooooooo

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 SELF EXAMINATION QUESTIONS

RECOMMENDED BOOKS FOR READING:

*********************

86
SHIPPING PRACTICE FIRST YEAR

LESSON 9
CARGO CARRIAGE & STOWAGE

1.0 Stowage Factor (SF) indicates how many cubic metres of space one metric tonne (or Cubic Feet
of space one long ton) of a particular type of cargo occupies.

1.1 It is calculated as the ratio of the stowage space required under normal conditions, including
the stowage losses caused by the means of transportation and packaging, to the weight of the cargo.

1.2 The stowage factor can be used in ship design and as a reference to evaluate the efficiency of
use of the cargo space on a ship.

1.3 It is an empirical (approximate) figure reached by experience and takes into account broken
stowage dunnaging. SF may be different from the actual cubic measurement of 1 tonne of the
commodity because of the method of packing or nature and origin of the commodity.

2.0 Formerly SFs were expressed in cubic feet per long ton (of 2240 pounds). Now it is expressed
in cubic feet per 1 metric ton (of 1000 kilos). Since the difference between long ton and metric ton is
only 1.6% it can be disregarded. Alternatively, SFs are expressed in cubic metres per 1 metric ton.
However, because SFs in cubic feet are easier to remember, the "market" prefers to work in cubic feet
than in cubic metres when describing SFs. It is important to bear in mind that 1 cubic metre = 35.3148
cubic feet. You can, therefore, convert one into another.

2.1 SFs are useful at the planning stage before a cargo is loaded to know how best to maximize
available space with greatest safety. To find the space required by any consignment the weight of the
cargo is multiplied by the SF.

2.2 The lighter a commodity the more space it will occupy and therefore its SF is higher. As a result
a ship with less cubic capacity would have difficulty in loading upto full deadweight capacity. (Corn, for
example, occupies about 50 cubic feet per tonne in bulk, whilst iron ore concentrate occupies about
13 cubic feet).

2.3 Most ship operators charge on volume basis for cargoes stowing at more than 40 cubic feet (or
more than 1 cubic metre) per tonne and on a tonnage basis for goods stowing at less than 40 cubic
feet per tonne. This has given rise to the term measurement ton for calculating freight.

2.4 Hence it is safe to say that goods having an average of more than SF 40 are considered as light
cargoes whilst goods averaging less than 40 are classified as heavy cargoes. (Some authors maintain
50 as the cut-off line). Shelter deck vessels which provide ample under deck space are preferred for
light cargoes, against the single deck vessels which are preferred for heavy cargoes where plenty of
space is not required.

2.5 SF is usually given without any reference to the units of volume or weight, that is, the number
of cubic feet or cubic metres per tonne is not mentioned.

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2.6 The stowage factor also depends on the type of packaging, being the lowest for unpackaged
bulk cargo. While most commonly used for dry bulk cargo, a stowage factor can also be calculated for
liquid bulk cargo and other commodities such as containers or cars. Stowage factors for several types
of cargo are presented in the following table

2.7 In case of bulk liquids, SF is replaced by SG (Specific Gravity). This is the reverse of SF and is the
mass (or weight) of one unit of volume of the liquid expressed as a ratio to the mass per unit volume
of pure water. This is because bulk liquids fill up the compartment into which they are loaded. SG has
no units but is simply a number. Crude oil is lighter than water and, therefore, has a specific gravity of
less than 1.00 which is the SG of pure water.

3.0 Following are the Factors that influence the STOWAGE FACTORS of the cargo:

• Nature of the cargo.

• The moisture content.
• Settling time of the cargo.
• The percentage of foreign matter.
• The age of the commodity.

3.1 SF can be ascertained correctly only by a laboratory analysis of samples from the cargo.

4.0 Broken stowage. This refers to space not occupied by cargo iii a cargo compartment or even
in a container. It can be caused by fittings in the ship, such as car decks in a ro-ro vessel or web frames
in a cargo hold. It can also be caused by the non-uniform shape of the cargo pieces themselves, such
as the spaces around protrusions in heavy machinery or between curved casks.

4.1 Broken stowage represents lost cargo space and therefore lost earning capacity. Moreover,
broken stowage is a void space, which could encourage cargo movement while the vessel is moving
in a seaway. Therefore broken stowage must be avoided as far as possible both by planning cargo
stowage so that the least space is wasted and by attempting to fill empty spaces between cargo. The
percentage of waste depends upon various factors, e.g., the kind of cargo and packing (bags or cases),
space occupied by dunnage, type of vessel (one or more tweendecks), number of hold obstructions
and the lines of the ship’s hull which affects the shape of the holds, in particular those nearest to the
bow and stem, etc. As a matter of course more space may be lost in fast cargo vessels, which have
sharp lines for speed. Another factor is the loss of space with bagged goods because bagged cargo may
be subjected to more pressure in the lower holds than in the tween decks of general cargo ships.

5.0 Dunnage is material used, such as timber battens, boards, mats, plastic sheets or paper, etc.,
(a) to prevent cargo from shifting; (b) to prevent damage (including sweat damage) to the cargo; and
(c) to separate different lots of cargoes.

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 COMMON STOWAGE FACTORS
(All figures are approximate)

COMMODITY SF PACKING

1. Bauxite 35/40 Bags

26/30 Bulk
2. Caustic Soda 34 Drums
3. Cement Portland 35/40 Bags
22/30 Bulk
4. Chrome Ore 13/16 Bulk
5. Coal 40/50 Bulk
6. Copra 95/110 Bags
7. Corn 50/55 Bags
47/50 Bulk
8. Cotton 80 (variable) Bales
9. Cotton Piece Goods 140/170 Bales
10. Coffee (Beans) 60/65 Bags
11. Flour 43/48 Bags
12. Groundnuts (Shelled) 60/65 Bags
13. Iron Ore Concentrate 11/15 Bulk
14. Jute 65/67 Bales
15. Manganese Ore 17/18 Bulk
16. Oats 83 Bags
17. Maize 80 Bags
18. Petroleum Coke 48 Bulk
19. Furnace Coke 70/75 Bulk
20. Rock Phosphate 33/35 Bulk
21. Rice 48/50 Bags
22. Rubber 65/67 Bags/Bales
23. Rubber Sheet 60 Sheets
24. Salt 35/40 Bulk
38/40 Bags
25. Scrap Iron 35 Bulk or Loose/Bales
26. Sugar 44/46 Bags
35 Bulk
27. Sulphur 30/32 Bulk
35/37 Bales
28. Tea 60/100 Chests
70/75 Drums
29. Wheat 52/54 Bags
47/49 Bulk
30. Urea 50/52 Bulk
60 Bags

6.0 DENSITY:

6.1 Density describes how much something weighs relating to its size, or mass per unit volume. In
technical terms, the density of a body is defined as the weight (mass) of the body in kilograms (kg)
divided by its external volume in cubic metres (m3).

6.2 The formula for density is: DENSITY = WEIGHT/VOLUME (KG/M3).

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6.3 Some examples of density for different fluids and materials are:

- Fresh water: 1,000 kg/m3

- Salt water: around 1,025 kg/m3

6.4 A HYDROMETER is an instrument used for measuring the relative density of liquids based on
the concept of buoyancy. They are typically calibrated and graduated with one or more scales such
as specific gravity.

6.5 A hydrometer usually consists of a sealed hollow glass tube with a wider bottom portion
for buoyancy, a ballast such as lead or mercury for stability, and a narrow stem with graduations for
measuring. The liquid to test is poured into a tall container, often a graduated cylinder, and the
hydrometer is gently lowered into the liquid until it floats freely. The point at which the surface of the
liquid touches the stem of the hydrometer correlates to relative density. Hydrometers can contain any
number of scales along the stem corresponding to properties correlating to the density.

6.6 Hydrometers are calibrated for measuring the density which needs to be ascertained for an
accurate draft survey.

6.7 A draft survey is a calculation of the weight of cargo loaded or unloaded to or from a ship from
measurents of changes in its displacement. The technique is based on Archimedes' principle.

6.8 The draft survey is performed by reading the ship's draft on the draft markings at six
standard points on the hull

 Forward Port Side (FP).

 Forward Starboard Side (FS).
 Midship Port Side (MP).
 Midship Starboard Side (MS).
 Aftward Port Side (AP).
 Aftward Starboard Side (AS).

6.9 Corrections for factors such as trim, water density and non-cargo weight changes are made
before calculating the cargo weight change.

6.10 Apart from calculating the displacement, we need to know the existing weights on vessel.

Example: we need to know the exact weight of ballast, Fuel oil, Lube oil, fresh water etc. on
board on arrival.

Arrival displacement = Lightweight of ship + Ballast + Fuel + Fresh water + Lube oil + Constants

6.11 Among these things we know the quantity of ballast, fuel, lube oil, and fresh water.

6.12 We need to repeat this calculation and measurement of all spaces after completion of loading.

Departure Displacement =
Cargo + Lightweight of ship + Ballast + Fuel + Fresh water + Lube oil + Constants

6.13 Lightweight of the ship and constants will remain same and so these does not matter. We
would know the arrival and departure displacement from draft survey. All other weights we know by
sounding and measurement. The only known is the cargo loaded. It is simple mathematics then to
know the cargo quantity.

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6.14 While calculating Displacement from the Ships HYDROSTATIC tables, the readings obtained are
for SALT WATER where the water density is at 1.025. However the water in which the vessel is at the
berth may be different than 1.025, the displacement of the vessel will change. As per Archimedes
principle the ship displaces water equal to its own weight. If the density of the water is more, ship
would displace less volume of water (less draft). And if density of the water is lesser, it would need to
displace more volume of water (more draft) to have same weight as of the ship itself.

6.15 It is prudent to obtain samples of the water in which the vessel is floating at, or very close to,
the time at which the draught marks are read. This is particularly relevant when the vessel is lying at
an estuarial or river berth, when the density of the water may be changing due to the ebb or flow of
the tide.

6.16 The density should be checked quickly after obtaining the sample as there may be temperature
differences between the actual sampling of the dock water and the time of determination of its
density, which may lead to errors in density.

6.17 Density of the water in the ballast tanks also influences the draft calculations on a vessel. It
should be established where the various ballast tanks were filled.

6.18 If they were from a single source, a few random samples of the water will confirm the density.

6.19 If from different sources, samples must be taken from tanks containing water from each of the
various sources and relevant densities of the water in individual tanks established.

6.20 The ballast tanks may contain significant amounts of muck in the form of sand, silt, shingle,
rust scale, etc. The density of these deposits will differ significantly from the ballast water. Also, it may
not be possible to determine the amounts of these solids that are in the tanks. The results are usually
assumed in the constant, but the value may be significantly inaccurate.

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7.0 The following parties are involved in a DRAFT or TANK ULLAGE survey:

 Charterer's surveyor
 Owner's surveyor
 Appointed Agent
 Chief officer or Master
 Shipper or Consignee
 Loading or Discharging terminal authorities.

8.0 Liquefied gas cargoes are measured and calculated in a similar manner to that of other bulk
liquid cargoes such as crude oils and petroleum products. However, as liquefied gases are carried as
boiling liquids in a closed containment system the quantity of vapour has also to be measured when
calculating the total quantity onboard.

8.1 For Tankers carrying Bulk Liquid cargo the Temperature and density is of prime importance
when calculating the cargo loaded.

Type of Vessel Cargo Calculation

Containers Count of Containers carried either 20' or 40' and measured in TEUS
Ro-Ro Lane Meters or CBM or Wt measure calculation done prior acceptance of cargo
PCC Count of Units
Multi-Purpose CBM or Wt measure or Units
Tankers Tank Ullage survey
Bulk Carrier Draught (Draft) Survey
Gas Carrier Tank Level Guage Survey

9.0 Irrespective of the type of the ship, the formal report document for ascertaining the cargo
loaded or discharged should include the following:

1. Dates and times of surveys.

2. Vessel particulars.
3. Vessel location.
4. Weather conditions (and whether these were within acceptable limits).
5. Sea conditions (and whether these were within acceptable limits).
6. Tidal/current conditions (and whether these were within acceptable limits).
7. A record of any difficulties or defects in a ship’s documentation or equipment that might
cause the calculated weight by draught displacement survey to be outside acceptable
limits of normal draught survey measurement error.

9.1 These reports should be jointly signed by the surveyor and the ship’s Chief Officer and any
comments to be made should be mentioned.

oooooo

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 SELF-EXAMINATION QUESTIONS

1. Define "Stowage Factor". How is it expressed?

2. What is the importance of stowage factors?
3. What procedure is applied to determine whether cargo is "light" cargo or "heavy" cargo?
4. What is SG? Why is it used only in case of liquid cargoes?
5. Explain the terms "dunnage" and "broken stowage".
6. Give approximate SFs of :
(a) Cement (bulk) (b) Cotton (piece goods) (c) Iron Ore (concentrates)
(d) Tea (chests) (e) Rubber (bales) (f) Wheat (bulk)
(g) Maize (bags) (h) Sugar (bulk) (i) Urea (bulk)
7. Why is dunnaging used on a vessel?
8. What are the factors to be borne in mind while stowing cargo on board a vessel?

RECOMMENDED FOR FURTHER READING:

1. Shipping Practice -- Stevens & Butterfield, 11th Ed., Reprinted 1997.

See Chapter 21, Pages 109-118 entitled “Cargoes, Stowage of Cargo and Cargo Information”.

2. Elements of Shipping -- A. E. Branch, 7th Ed., 1996.

Read Chapter 13, Section 13.3, Pages 282-291, on “Types and Characteristics of Cargo”.

3. Sea Transport -- P.M. Alderton, 4th Ed., 1995.

**********

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SHIPPING PRACTICE FIRST YEAR

LESSON 10
CARGO HANDLING EQUIPMENTS USED ON BOARD & ASHORE

1.0 CONCEPT OF 'UNIT LOAD’:

1.1 With a view to save time and cost while handling, loading, discharging and transporting,
cargoes/goods are consolidated and made as large a unit as possible, e.g., 5 tons, 10 tons, 20 tons, 40
tons, etc. so that at every point of handling of the unit, time is saved. Hence cost is saved.

Example: A crane makes 50 to and fro movements to load 50 tons of cargo on the basis of 1 ton per
sling load. If the sling load is increased to as much as 10 tons, the number of to and fro movements
comes down proportionately to only 5. By using unit load system, thus time and cost saved. The principle
-- bigger the units, fewer the lifts -- has given rise to the unit-load concept. Container is a unit load and
the adoption of this mode results in reduction of time and cost.

1.2 Developed countries like U.S.A., Europe, Japan, etc. prefer this system as it helps to increase
productivity many fold in cargo handling by displacing labour which is scarce in those countries.
Further, as the unit load becomes bigger and bigger, manual operation is just not possible. Hence
mechanical methods are introduced involving additional capital investments.

1.3 Thus two or more types of cargo grouped together are said to be unitized. This method has
helped to speed up the loading, stowing and discharging of goods, and to facilitate transfer of
commodities to and from storage and between various modes of transport.

1.4 Unitization increases costs to a certain extent as a result of The extra equipment required, and
Broken stowage.

1.5 But it has the advantages of:

 Reducing pilferage and damage to goods, safe transportation of goods.

 Simplifying tallying.
 Reducing the number of stevedores required.
 Increases productivity as per unit weight handled is relatively higher.
 Ease of transshipment of goods.

1.6 Unitization involves strapping and pre-slinging techniques, palletization, containers, barges
and RO/RO system. Each system has its uses and advantages.

1.7 There is now a well-established international organization dealing with the subject of
unitization and the most convenient, economical and safe ways to handle cargoes, called the
"International Cargo Handling Co-ordination Association" (ICHCA), based in London.

2.0 STRAPPING:

2.1 The grouping together of homogeneous goods can be accomplished by glueing or by nets.
However, straps are often used. To avoid damage from these straps, protective material, that is,
dunnage, is used around the edges of the goods.

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3.0 PRE SLINGING:

3.1 One method is to increase the bag size, say, from 25 kg to 50 kg or 100 kg or even to one tonne
parcels. To enable these jumbo bags to be lifted handles have been fitted to them, which can be
hooked by cargo handling gear and lifted on or off the carrying vessel.

3.2 An alternative method is to the slings around a group of smaller bags, which once loaded, are
left in position with sling eyes in a convenient position for the unit to be hooked up and lifted upon
discharge. This technique is known as pre-slinging.

3.3 Pre-slinging is also beneficial to palletised goods, bales, steel products and reels of newsprint,
and it is commonplace to encounter pre-slung goods in today's markets for example, pre-slung shrink-
wrapped bagged cement.

(Shrink-wrapped is a term used to describe transparent plastic sheet covering around a unit of
goods, being often heat-shrunk into place. Such a protective cover keeps goods intact within
the unit, dry and free from dirt or stain or moisture and tends to reduce pilferage).

3.4 In wide open hatch ships and twin hatches the advantages to be gained by using pre-slinging
techniques can be enormous. Traditional hatch arrangements with deep wing tanks are not so suitable
since the sling load cannot be landed directly from the hook to its stowed position. It needs forklift
trucks to stow them in the wings, thereby defeating the purpose of saving valuable time and cost.

3.5 A certain amount of space is lost (perhaps 10 or even 15 per cent), but this is usually more
than made up due to the speed of cargo handling achieved. The space lost is less than that for palletised
or skidded cargo, and the cost of slings is probably competitive with the cost of pallets.

4.0 PRESLINGING MATERIALS: (See Figure below):

4.1 Any normal sling material may be used for a pre-slinging operation:

 Chain slings.
 Fibre rope.
 Steel wire rope.
 Flat synthetic fibre.

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4.2 Also under certain circumstances, nets, baskets or trays.

4.3 It is common for certain types of commodities to have the following types of slings:

Bagged Goods: Clover leaf slings, of natural or man-made fiber ropes and strops

Reels of Paper and Newsprint: Flat synthetic strops, or endless slings often used in pairs.

Sawn Timber: Wire or flat synthetic choker strops. Ensure that bearers and dunnage must be
used between units when using flat synthetic slings to avoid severe chafting damage in bad
weather.

Cartons and Cased Goods, Bales and Pulp : Flat synthetic slings -- also rope or wire slings.

Steel Products : Various, depending on weight, units shape, and number of potential lifting
points. Round steel piping is often pre-clung using two flat choker strops in a bridle. Steel plate,
on the other hand, will usually require wire or chain slings.

5.0 HANDLING:

5.1 When loading, it must be ensured that the sling eyes are left in an accessible position on top
of the load ready for immediate hooking on at the time of discharging. When discharging, care must
be taken to ensure that eyes from two adjacent units are not hooked up together thinking that they
are from the same unit.

5.2 It is important to note that during handling operations a pre-slung load remains intact and
does not break up due to careless handling. If pre-slung loads do break up then immediately manual
operation is required to move that cargo and much of the advantage gained from pre-slinging is lost
due to higher costs in labour and time.

5.3 It is important that a series of pre-slung units be made up of the same number of bags, cartons
or anything, so that tallying is made easier. Bills of lading should not be mixed in one pre-slung load.

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5.4 Slings should be of adequate strength and colour codes checked so that safe working loads
and limitations may be observed.

6.0 PALLETIZATION:

6.1 A natural improvement from pre-slung cargo is to provide a platform, example, a wooden
pallet or skid, on which goods are secured such as drums or cartons, thereby allowing stacking in tiers.
Pallets are made in various sizes, depending on the goods to be shipped and the use to which the pallet
is put.

6.2 The deck (or plan) size depends on a number of factors:

 Size of cargo to be palletized.

 Type of cargo to be palletized (e.g. drums, bags, etc.)
 The use to which it will be put: one trip only, inland/ocean transport requirements, etc.

6.3 An attempt to standardise pallet sizes has been made by the International Standards
Organization (ISO). It has recommended the following:-

 1000 x 800 mm (40"x 32")

 1200 x 800 mm (48" x 32")
 1200 x 1000 mm (48" x 40")
 1200 x 1600 mm (48" x 64")
 1200 x 1800 mm (48" x 72")

6.4 Pallets are loaded in to a ship by fork-lift truck and are limited by the number of tiers of
height to which they can be stacked.

6.5 Pallets are of two types: (Figure Below):

Two Way Pallets

Four Way Pallets

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7.0 METHOD OF SECURING :

7.1 The cargo should be secured onto the pallet by one or more of the following methods:

Strapping made from manmade fibre or steel.

Nets: Usually polypropylene are used to secure odd shaped packages onto a pallet.

Glue: For securing cartons or bags.

Shrink-wrap: A plastic (transparent) cover over the pallet load which is heat-shrunk into place.
Certain types of plastic wrapping may be put around the cargo without the necessity of heat.
It is used for most goods. It provides protection against dirt, pilferage, etc.

Locking Pattern: Unit loads may be built up on pallets with dimensions suited to the modules
being handled.

8.0 HANDLING AND STOWAGE:

8.1 A flat unobstructed deck space is the best suited for positioning and stowing pallets. They
should never be dragged. Such treatment may collapse the pallet. Vessels which have not been built
with pallet handling facility in mind, e.g., without flush tween deck hatch coamings, etc., may need
extensive preparation work carried out before loading commences.

9.0 THE EFFECT OF THE PALLET:

9.1 The pallet, because it raises the cargo approximately 6" off the deck of the hold, has the effect
of raising the centre of gravity of the cargo which may, in certain circumstances, have to be allowed
for. Pallets occupies than conventional dunnage, perhaps 10 to 15 %.

9.2 Some overhead space may be lost if the height of the pallet load does not form a module of
the height between decks or in the holds of the ship -- or the inside height of the container. If the
pallets are being made constructed on the quay, this height may be adjusted (in some instances) to
suit the particular height requirements of the ship.

9.3 Pallet loads may be made up in such a manner that the units are suitable for carriage of
refrigerated cargoes following aspects must be to be taken into consideration:

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  Air-flow is not impeded by securing materials or the positions of the pallet loads.
 If two-way entry pallets are being used, then the pallets must be so positioned that the
air-flow is not blocked by the supporting members.
 The deck of the pallet may have to be perforated to allow free movement of controlled air
temperature. This is particularly important for cargoes (e.g. fruit) in packaging designed to
allow vertical through-movement of air.

10.0 BARGES:

10.1 The next improvement in cargo unitisation was the system by which dumb barges or lighters
(that is, barges without engines), empty or laden with goods are carried as units aboard specialized
deep-sea going vessels. Just like containers, these barges are loaded next to a consigneer's premises,
then towed via waterways to the port of loading before proceeding to their ultimate destination
aboard a mothership. After off-loading the barges once more will have the facility to reach their
destination by waterways with the help of a tow whilst the mothership, with minimum delay, can
return with other loaded or empty barges which are available. The variety of goods these barges can
carry is as varied as for containers. The barges can also load containers, their advantage being in
carrying heavy loads of several thousand tonnes per barge.

10.2 Barge systems so far developed are known as either SeeBee, LASH (Lighter aboard Ship) and
BACAT (Barge aboard Catamaran), each using a distinctive method of loading/discharging barges, and
each system operating its own size of barge on particular trade routes.

10.3 LASH stands for 'lighter aboard ship”, a system for carrying cargo aboard ship in lighters, which
are 'floating containers' of 61ft. 6 in. x 31 ft. 2 in. x 13ft., each with a capacity of 415 tons. The vessel
has a tonnage capacity of 26400, a length of 814 ft., a beam of 100 ft. and a speed of 23 knots. The
crew does not exceed 43 members. The entire LASH-ship can be loaded in 24 hours with 49 barges and
356 standard containers of 20ft. x 8ft. x 8ft. by means of a travelling shipboard crane of 500-ton
capacity supplemented by a gantry crane of 35 ton capacity. The operation of the container crane does
not interfere with the large barge crane. The lighters can be pre loaded at various piers in sea-and
inland-ports, and then be tugged to the roadstead, the water near the shore in which the ship can ride
at anchor; she does not need to enter into the port's congested areas. Neither special berths nor
conventional ships alongside, to take over the cargo when discharging, are necessary.

11.0 Wheeled Units as Cargo:

11.1 Railway engines and wagons themselves form specialized cargoes for those traders
experienced in their shipment and for owners of ships capable of carrying them. It was once a common
place to carry them on deck, using extensive dunnage, even though this exposed valuable machinery
to external elements. The introduction of twin-hatch and open-hatch ships has, however, opened up
alternatives by which these bulky units can be lowered directly into the holds and lashed/secured into
place, without too much interference or restriction of other goods.

(Other wheeled vehicles transported by ships include bulldozers, agricultural and road-making
equipment, buses, trucks and cars).

12.0 General cargo/Multi purpose ships are typically fitted with derricks or DECK CRANES to load
or discharge cargo from piers or lighters. Derrick is a lifting device composed of a pole which is hinged
freely at the bottom. It is controlled by 4 lines by means of Motors / Winches, so that the pole can
move in all four directions.

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12.1 The Ships Crane is a fixed structure on the vessel which pivots on the main column.

12.2 The S.W.L. of the cranes must be clearly marked in a conspicuous position on the crane jib, and
it must be ascertained by the Chief Officer that all parties concerned with the load/discharge operation
are aware of the maximum capacity of cranes, and that this is not exceeded. The weight of grabs,
spotters, or other cargo handling equipment attached to the hook must always be taken into account.

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12.3 On GENERAL CARGO SHIPS, For Bagged cargo Loading or discharging, Multiple slinging
arrangements are used which increases the productivity of the stevedoring activity.

12.4 For certain sensitive cargo packed in bags such as expensive chemicals or food stuff, these are
loaded or discharged using a CAGE, which protects the bags from making contact with the vessel or its
sides or holds to avoid it from being torn or stained.

12.5 In case of certain bulk cargo carried in Jumbo bags, these are assisted by a earth moving
equipment customized for handling jumbo bags so that they can reach out to the corners of the hold
and stack the jumbo bags and maximize the stowage in the hold.

12.6 Slings made out of STAINLESS STEEL WIRE or NYLON or POLYPROPYLENE are used in
combination as gears or tackles for the cargo loading and discharging operations with shackles,
Turnbuckles. Each and every item used during the cargo operation should be certified and tested and
used basis their certified SAFE WORKING LOAD.

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13.0 RO – RO Ships:
13.1 Ro-ro is an acronym for Roll-on/roll-off. Roll-on/roll-off ships are vessels that are used to carry
wheeled cargo. The ro-ro ship is different from lo-lo (lift on-lift off) ship that uses a crane to load the
cargo. The vehicles in the ship are loaded and unloaded by means of built-in ramps. Normally these
ramps are made towards the stern (backside) of the ship. In some ships, they are also found on the
bow side (front) as well as the sides.

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13.2 There are various types of ro-ro vessels, such as ferries, cruise ferries, cargo ships, and barges.
The ro-ro vessels that are exclusively used for transporting cars and trucks across oceans are known as
Pure Car Carriers (PCC) and Pure Truck & Car Carriers (PCTC) respectively.

13.3 Unlike other cargos that are measured in metric tonnes, the ro-ro cargo is measured in a unit
called lanes in meters (LIMs). LIM is calculated by multiplying cargo length in meters by the number of
decks and by its width in lanes. The lane width will differ from vessel to vessel and there are a number
of industry standards.

13.4 Advantages of a RO-RO ship over traditional ships:

 For the shipper, the advantage is speed. Since cars and lorries can drive straight on to the
ship at one port and then drive off at the other port within a few minutes of the ship
docking, it saves a lot of time of the shipper.

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  It can also integrate well with other transport development, such as containers. The use
of Customs-sealed units has enabled frontiers to be crossed with the minimum of delay.
Therefore, it increases the speed and efficiency of the shipper.
 The ship has also proved extremely popular with holidaymakers and private car owners. It
has significantly contributed to the growth of tourism. A person can take his car from one
country to another by the sea with the help of a ro-ro vessel.

13.5 Variations of RO-RO ships are as below:

 RO-RO Car Container Carrier.

 RO-RO Car Truck Carrier (PCTC).
 RO-PAX Vessel.
 RO-RO Pure Car Carrier.
 RO-RO Expedition Cruise Ship.

14.0 TANKERS – CARGO OPERATIONS:

14.1 Cargo Operations whether loading / Discharging can be moved on or off of an oil tanker in
several ways.

14.2 One method is for the ship to moor alongside a pier, connect with cargo hoses or marine
loading arms.

14.3 Another method involves mooring to offshore buoys, such as a single point mooring, and
making a cargo connection via underwater cargo hoses.

14.4 A third method is by ship-to-ship transfer, also known as lightering. In this method, two ships
come alongside in open sea and oil is transferred manifold to manifold via flexible hoses. Lightering is
sometimes used where a loaded tanker is too large to enter a specific port.
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14.5 TANKERS discharge cargo with installed pumps and generally carry sufficient cargo hose to
connect to receiving terminals. These pumps are called CARGO OIL PUMPS and rated according to the
vessel size.

14.6 Loading oil cargo in a tanker ship require utmost diligence in planning and most careful
consideration will need to be made for safe operation. Following are the basic procedures at various
stages of loading oil cargo

14.7 The main consideration for restricting the maximum rate at which a vessel may load is to
prevent the excessive build up of pressure within the cargo system. This is governed by a number of
factors including the diameter of the smallest section of pipe in the system, the material from which
the pipe is constructed, the angle frequency of bends, the capacity of the venting system, etc.

14.8 The closed loading system, whereby vapours are exhausted through either vent risers or high
velocity vents, must always be used where possible. The rate of loading must be adjusted to take into
consideration the number of tanks or holds open at any one time.

14.9 It is important that the maximum loading rate is not exceeded to avoid over pressurization and
undue stress on the pipeline system. Consideration of the rate of loading must also be taken into
account in view of electrostatic hazards when handling static accumulator oils where an electric charge
can build up by means of flow or turbulence. Generally speaking, the method of controlling
electrostatic generation is to restrict the flow rate in the initial stages of loading until all splashing and
turbulence in the tank has ceased. Full details of such precautions are contained in ISGOTT. ISGOTT is
the definitive guide to the safe carriage and handling of crude oil and petroleum products on tankers
and at terminals. (The International Safety Guide for Oil Tankers and Terminals)

15.0 BULK CARRIERS:

15.1 On Bulk Carriers cargo ops is done by shore based CONVEYORS carrying the cargo from the
stacking area, by GRABS or by a LOADING ARM/CHUTE.

15.2 The Grabs used for discharging could be mechanical, Electrical or Electro-hydraulic which
could be customized for certain categories of cargo for loading and discharging. These GRABS could
be Shipboard or owned by shore stevedoring or terminals.

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15.3 For discharging of cargo ESCAVATORS are used which are connected to conveyor belts and
linked to the SILOS on the wharf. The other options are whereby a Portable Quay gantry crane with a
grab discharges the same into a HOPPER which will dump either on a conveyor or directly onto trucks
for carrying the same to the warehouse.

15.4 On Capesize bulk carriers dedicated to carry ORE or coal cargo, these vessels berth at the BULK
ORE TERMINAL and connected by conveyor belts to the stacking area of the cargo closer to the mines.
These conveyor belts run long distance to the piers where the ships are moored. (Figure below)

16.0 CONTAINER TERMINALS:

16.1 Container ships berth at container terminals which are equipped with the following equipment
to handle the containers for loading/discharging from the vessel, movement within the container
terminal i.e. Container Yard.

16.2 RMQGC – Rail Mounted Quay Gantry Crane: Ship-to-shore gantry cranes are imposing, multi-
story structures prominent at most container terminals, used to load intermodal containers on and
off container ships. They operate along two rails (waterside and landside designations) spaced based
on the size of crane to be used.

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16.3 Ship-to-shore crane elements:

16.3.1 Lateral movement system: A combination of two sets of typically ten (10) rail wheels. The
lateral movement is controlled by a cabin along the landside wheel. During any lateral movement,
lights and sirens operate to ensure safety of the crew operating adjacent to the crane. The wheels are
mounted to the bottom of the vertical frame/bracing system.

16.3.2 Vertical frame and braces: A structurally designed system of beams assembled to support the
boom, cabin, operating machinery, and the cargo being lifted. They display signage describing
restrictions, requirements and identifiers.

16.3.3 Crane boom: A horizontal beam that runs transversely to the berth. It spans from landside of
the landside rail wheels to a length over the edge of the berth. The waterside span is based on the size
of ship that it can successfully load/unload. Beams also have the ability to be raised for storage
purposes.

16.3.4 Hook: Device which moves vertically to raise and lower cargo as well as horizontally along the
boom's length. For container cranes, a spreader is attached to span the container and lock it safely in
place during movement.

16.3.5 Operating cabin: Encased setup with glass paneled flooring for operator to view the cargo
being moved. Elevators which are located along vertical frame members are used to get crew up and
down from the cabin. The operating cabins could be the FIXED type or movable with the spreader.

16.4 The RMQC is the one which is used to LOAD and discharge a container from / to the ship from
the wharf. The RMGC is a gantry crane which is relatively smaller in size and span used in the rail heads
of the container terminals and ICD (Inland Container Deports) for faster loading and discharging of
containers from the terminal to the train for intermodal movement.

16.5 RUBBER-TYRED GANTRY CRANE:

16.5.1 Smaller gantry cranes are also available running on rubber tyres so that tracks are not needed.
Rubber tyred gantry cranes are essential for moving containers from berths throughout the rest of the
yard. For this task they come in large sizes, that are used for moving to straddle multiple lanes of rail,
road, or container storage. They also are capable of lifting fully loaded containers to great heights.

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16.5.2 Portable gantry crane systems, such as rubber tyred gantry cranes, are in high demand in
terminals and ports and used in CFS (Container Freight Stations) restricted in size and reliant on
maximizing vertical space and not needing to haul containers long distances. This is due to the
relatively slow speed yet high reach of rubber tyred gantry cranes when compared to other forms of
container terminal equipment.

16.5.3 Smaller rubber tyred gantry cranes come in the form of straddle carriers which are used when
moving individual containers or vertical stacks of containers. The Straddle carriers in certain container
terminals are used in way of the Hauler & Trailing units. These Straddle carriers could be MANNED or
UNMANNED.

16.5.4 In case of UNMANNED straddle carriers, these are controlled remotely from the administrative
building from the control room by specially trained professionals.

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17.0 Cargo handling Equipment at CY, CFS & ICD:

17.1 A reach stacker is a vehicle used for handling intermodal cargo containers in small terminals
or medium-sized ports. Reach stackers are able to transport a container short distances very quickly
and pile them in various rows depending on its access.

17.2 Reach stackers have gained ground in container handling in most markets because of their
flexibility and higher stacking and storage capacity when compared to forklift trucks. Using reach
stackers, container blocks can be kept 4-high.

17.3 There are also empty stackers or empty container handlers that are used only for handling
empty containers quickly and efficiently. They are utilized at the container yards, Container freight
stations and ICD’s.

18.0 FORK LIFTS:

18.1 A forklift (also called lift truck, jitney, fork truck, fork hoist, and forklift truck) is a powered
industrial truck used to lift and move materials over short distances.

18.2 Forklifts have become an indispensable piece of equipment in manufacturing and

warehousing. They are powered by diesel, gas or customized in special warehouse to run on battery
(Electric).

18.3 Forklifts are rated for loads at a specified maximum weight and a specified forward center of
gravity. This information is located on a nameplate provided by the manufacturer, and loads must not
exceed these specifications.

18.4 An important aspect of forklift operation is that it must have rear-wheel steering. While this
increases maneuverability in tight cornering situations, it differs from a driver’s traditional experience
with other wheeled vehicles. While steering, as there is no caster action, it is unnecessary to apply
steering force to maintain a constant rate of turn.

18.5 It’s imperative that these structures be designed to accommodate their efficient and safe
movement. In the case of Drive-In/Drive-Thru Racking, a forklift needs to travel inside a storage bay
that is multiple pallet positions deep to place or retrieve a pallet. Often, forklift drivers are guided into
the bay through guide rails on the floor and the pallet is placed on cantilevered arms or rails.

18.6 These maneuvers require well-trained operators. Since every pallet requires the truck to enter
the storage structure, damage is more common than with other types of storage. In designing a drive-
in system, dimensions of the fork truck, including overall width and mast width, must be carefully
considered.

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18.7 Forklift trucks are available in many variations and load capacities. In a typical warehouse
setting, most forklifts have load capacities between one and five tons. Larger machines, up to 50 tons
lift capacity, are used for lifting heavier loads, including loaded shipping containers.

19.0 MOBILE HARBOUR CRANE:

19.1 The flexibility of the mobile harbour crane makes it effective for all areas of application in the
harbour and thereby guarantee the highest level of effectiveness.

19.2 They are particularly of immense importance in ports which are restricted on space at the
wharf. With retractable legs and mounted on tyres, these are portable and useful in ports where the
berth could not be straight but in an L shaped and restricted for installation of rails for Gantry cranes.

19.3 The operation of an MHC is highly precision and they have skilled workforce who are able to
achieve approximately 30 moves per hour on these MHC in certain container terminals. These Mobile
harbor cranes are versatile in their use. By disconnecting the spreader and the hook can be connected
for operating grabs on a bulk vessel.

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20.0 CARGO GEAR AND RESPONSIBILITIES OF OWNER:

• To provide safe ship’s gear & equipment for cargo-handling on board the vessel.
• Carry out periodical inspection & maintenance of the equipment & gears & ensure they
are in safe working order.
• Provide necessary information, training, instruction on safe working practices, the
potential risks and the necessary safety measures while engaged in cargo handling
operations.
• To provide proper personal protective equipment, such as safety harness, safety helmet,
safety shoes etc., and to ensure these personal protective equipment are properly used
and maintained.
• The lifting appliances and lifting gear used on board are of good mechanical construction
& design, made of strong & sound materials, & free from patent defect.
• Cargo handling gear and machinery should not be subjected to loads beyond the certified
safe working load. In determining the Safe working load, Weight of the lifting gear should
also be taken into account.
• The weight of a heavy package or article of cargo should, if any doubt exist, be checked
before being lifted.
• Ship’s cargo handling appliances and gears should never be used for lifting and carriage of
person unless it is specially designed, altered and equipped to ensure safety, and have
obtained permission from ship’s master or duty officer.
• Cargo handling gear should only be used for the purpose for which it is intended.
• Record of all surveys and tests conducted and valid certificates to be maintained on board
the ship and also ashore where the equipments are being used.

21.0 REGISTER of SHIPS CARGO HANDLING GEAR & APPLIANCES:

21.1 A Register of Lifting appliances and items of loose gear shall be kept in a form prescribed by
the competent authority, account being taken of this model recommended by the International Labour
Office.

21.2 This Register and related Certificates shall be kept and be available to any person authorized
by the competent authority. The Register and Certificates for gear currently aboard the ship shall be
preserved for at least five years after the date of the last entry

22.0 INITIAL EXAMINATION AND CERTIFICATION:

22.1 Every lifting appliance shall be certified by a competent person before being taken into use for
the first time to ensure that it is of good design and construction and of adequate strength for the
purpose of which it is intended.

22.2 Before being taken into use for the first time a competent person shall supervise and witness
testing, and shall thoroughly examine every lifting appliance.

22.3 Every item of loose gear shall, before being taken into use for the first time be tested,
thoroughly examined and certified by a competent person in accordance with national law or
regulations.

22.4 Upon satisfactory completion of the procedures indicated above the competent person shall
complete and issue the Register of Lifting Appliances and attach the appropriate Certificates. An entry
shall be made in Part I of the Register.

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22.5 A rigging plan showing the arrangement of lifting appliances shall be provided. In the case of
derricks and derrick cranes the rigging plan should show at least the following information:

(a) the position of guys

(b) the resultant force on blocks, guys, wire ropes and booms
(c) the position of blocks
(d) the identification mark of individual items
(e) arrangements and working range of union purchase.

23.0 PERIODIC EXAMINATIONS AND RE-TESTING:

23.1 All lifting appliances and every item of loose gear shall be thoroughly examined by a competent
person at least once in every 12 months. The particulars of these thorough examinations shall be
entered in Part I of the Register.

23.2 Re-testing and thorough examination of all lifting appliances and every item of loose gear is to
be carried out:

(a) after any substantial alteration or renewal, or after repair of any stress bearing part; and
(b) in the case of lifting appliances at least once in every five years.

23.3 The re-testing referred to in paragraph 2.2 (a) may be omitted provided the part which has
been renewed or repaired is subjected by separate test, to the same stress as would have been
imposed on to it if it had been tested in situ during testing of the lifting appliance.

23.4 The thorough examinations and tests referred to in paragraph 2.2 are to be entered in Part I
of the Register.

23.5 No new item of loose gear shall be manufactured of wrought iron. Heat treatment of any
existing wrought iron components should be carried out to the satisfaction of the competent person.
No heat treatment should be applied to any item of loose gear unless the treatment is in accordance
with the manufacturer’s instruction; to the satisfaction of the competent person. Any heat treatment
and the associated examination are to be recorded by the competent person in Part I of the Register.

23.6 INSPECTIONS: Regular visual inspections of every item of loose gear shall be carried out by a
responsible person before use. A record of these regular inspections is to be entered in Part II of the
Register, but entries need only be made when the inspection has indicated a defect in the item.

23.7 CERTIFICATES: The certification forms to be used in conjunction with this Register (Form No.
1) are as follows:

 Form No. 2 – Certificate of test and thorough examination of lifting appliances.

 Form No. 2 (U) – Certificate of test and thorough examination of derricks used in union
purchase.
 Form No. 3 – Certificate of test and thorough examination of loose gear.
 Form No. 4 – Certificate of test and thorough examination of wire rope.

23.8 DEFINITIONS: The term “competent authority” means a minister, government department or
other authority empowered to issue regulations, orders or other instructions having the force of law.

23.8.1 The term “competent person” means a person possessing the knowledge and experience
required for the performance of thorough examinations and tests of lifting appliances and loose gear
and who is acceptable to the competent authority.
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23.8.2 The term “responsible person” means a person appointed by the master of the ship or the
owner of the gear to be responsible for the performance of inspections and has sufficient knowledge
and experience to undertake such inspections.

23.8.3 The term “thorough examination” means a detailed visual examination by a competent
person, supplemented if necessary by other suitable means or measures in order to arrive at a reliable
conclusion as to the safety of the lifting appliance or item of loose gear examined.

23.8.4 The term “inspection” means a visual inspection carried out by a responsible person to
decided whether, so far as can be ascertained in such manner, the loose gear or sling is safe for
continued use.

23.8.5 The term “lifting appliance” covers all stationary or mobile cargo-handling appliances used on
board ship for suspending, raising or lowering loads or moving them from one position to another
while suspended or supported.

23.9 All loose gear should be inspected before use. However, entries need only be made when
the inspection discloses a defect.

24.0 INTERNATIONAL CARGO HANDLING COORDINATION ASSOCIATION (ICHCA):

24.1 The International Cargo Handling Coordination Association (ICHCA), founded in 1952, is an
independent, not-for-profit organization dedicated to improving the safety, security, sustainability,
productivity and efficiency of cargo handling and goods movement by all modes and through all phases
of national and international supply chains.

24.2 ICHCA International’s privileged non-government organization (NGO) status enables it to

represent its members, and the cargo handling industry at large, in front of national and international
agencies and regulatory bodies.

24.3 Its Expert Panel provides technical advice and publications on a wide range of practical cargo
handling issues.

24.4 ICHCA International operates through a series of autonomous national and regional chapters
– including ICHCA Australia, ICHCA Japan and ICHCA Canarias/Africa (CARC) – plus Correspondence and
Working Groups to provide a focal point for informing, educating, networking, shaping and sharing
industry views to improve knowledge and best practice across the global cargo chain.

24.5 ICHCA International has an extensive range of specialist publications on best practice in cargo
handling operations.

25.6 With more than 90 documents covering health and safety guidance, technical and operational
practicalities, regulatory requirements and more, the ICHCA library represents a valuable repository of
cargo handling expertise.

25.7 The publications are grouped into eight core series:

 Briefing Pamphlets
 Research Papers
 Information Papers
 Technical & Operational
 General
 Safety & Other Guides
 Environment & Security

oooooo

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 SELF-EXAMINATION QUESTIONS

1. Explain the term "unitization". S+tate its advantages and disadvantages?

2. Explain the following :
(a) Preslinging
(b) Strapping
(c) Handling and stowage of cargo
(d) Shrink-wrapping
3. Write short note on palletization stating its importance in shipping.
4. What are barges? How do the LASH and BACAT systems operate?
5. What cargo handling methods are used in a general cargo vessel?
6. What types of equipment are used in a port for handling container?
7. How is grain loaded and discharged?
8. Explain the following and where they are used?
a) RMQGC, b) RMGC, c) RTGC, d) Straddle Carrier

RECOMMENDED FRO FURTHER READING:

1. Shipping Practice -- E. F. Stevens, 11th Ed., 1981.

2. Illustrated Dictionary of Cargo Handling -- R. R. Brodie, 2nd Ed., 1996.
3. Dictionary of Shipping Terms -- P. R. Brodie, 3rd Ed., 1997.
4. Sea Trading Vol.1 (The Ships) -- W. V. Packard, 1st Ed., 1984.
5. Sea Trading Vol.2 (Cargoes) -- W. V. Packard, 1st Ed., 1985.
6. Elements of Shipping -- A. E. Branch, 7th Ed., 1996.
7. Sea Transport by Patrick M. Alderton.

*******************

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SHIPPING PRACTICE FIRST YEAR
LESSON 11

INTERMEDIARIES IN SHIPPING
1.0 SHIPBROKER:

1.1 The shipowners as well as the charterers are very busy people. Therefore, it is necessary to have
someone to coordinate their interests. This is where the shipbroker steps in.

1.2 The principal functions of a shipbroker are:

 To negotiate and fix charters for cargo liners and tramp vessels.
 To act as chartering agents for large trading concerns.
 To negotiate for sale and purchase of ships.

1.3 Shipbrokers can be divided into six categories, depending on their proficiency in a particular area
which is their field of specialization:

(a) Shipowner's broker: His business is to look for cargoes for a vessel, according to availability
and location of the vessel.

(b) Charterer's broker or Chartering agent: He negotiates with the shipowners to fix suitable
tonnage (ships) that the charterers require.

(c) Coasting broker: He acts on behalf of both, that is, the shipowner and the charterer but in
the coastal trade only.

(d) Exclusive broker: If the owner chooses to do business through one single and sole broker
only, then that broker is referred to as an exclusive or a confidential broker.

(e) Competitive broker: The broker who brings together the exclusive broker of the shipowner to
negotiate with the broker of a charterer.

(f) Cable broker: The broker who constantly keeps on feeding both the charterer and the
shipowner with world market trends and changing political scenarios.

1.4 Generally brokers represent a number of principals, that is, several owners and/or charterers. But
at the same time they may work as exclusive brokers for certain principals. This ensures that they have
fairly regular and secure employment even during lean times.

2.0 The broker is responsible for his principal's fortunes and should act judiciously by --

2.1 Apprising his principal of the changing market trends influenced by weather and political
upheavals.

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2.2 Carrying out negotiations by not exceeding the limit and acting within the parameters specified
by his principal. An example would be that of a vessel's speed. Actual speed of the vessel may be 12 knots
but to conclude the deal he may describe the speed of the vessel to the chaterers as 13 knots. The
shipowner may later find it difficult to contest claims.

2.3 Carrying out the work entrusted to him by his principal loyally, skillfully and scrupulously.

2.4 By not misleading his principal in any way either by withholding information or by feeding him
wrong information. He should not leak, out any information about his principal which would be
detrimental to the principals interests and advantageous to the opposite or competing party.

2.5 By correcting any wrongs and making sure they are duly set right, as it is his duty to protect his
principal's reputation and business.

2.6 By following up post-fixtures to ensure successful completion of the contract.

2.7 The broker, with his well acquired business talent, should point out any orders (or clauses) which
are wrongfully worded and should make sure that they are duly set right. It is his prime duty to protect
his principal.

2.8 As explained earlier, the broker should actively involve himself in the negotiations by his
assessment of the proposals and compromises that can be made to conclude the deal. In short, the
principal should be satisfied that his broker is an asset to him and that the broker's performance is
satisfactory.

2.9 A shipowner's and charterer's broker is usually paid a brokerage / commission of 1.25% of the
money earned by the shipowner for the broker's time and efforts in negotiating and arranging a contract.
Commissions are paid by the shipowner irrespective of whom the broker represents.

2.10 Shipbrokers generally deal with their associates in other countries, one party representing the
shipowner and the other the charterer.

3.0 FREIGHT BROKER:

3.1 The freight broker, by tradition, is a middleman between the cargo owner and the carrier. In
earlier times, general cargo was booked depending upon the space available in ships, itinerary of the
vessel and time required to reach the port of destination. The actual freight rate was not fixed but varied
according to the type of cargo and its compatibility with other cargoes for stowage and carriage. Thus, he
had to negotiate freight rate with the carrier on behalf of the cargo owner.

3.2 The freight broker books space (for general cargo or FCL or LCL) with the freight forwarder or with
the carrier i.e. with shipping company directly or with the multimodal transport operator.

3.3 Freight broker does not issue a bill of lading. He merely acts as an intermediary. The B/L is issued
by the freight forwarder or the multimodal transport operator or by the carrier. Freight broker generally
charges a brokerage of 2% of the freight which the carrier recovers from the shipper by way of higher
freight.

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4.0 FREIGHT FORWARDER:

4.1 With the advent of containerization, in late 70s the transport industry has undergone a
tremendous change. Earlier, freight brokers used to merely do the job of Customs House clearance and
booking of space on a vessel. Now in modern era, freight brokers have realized the importance of
providing all facilities through a single window to the shipper. Therefore they have gone into forward and
backward integration of their business. A shipping and forwarding agent is nowadays termed as a "freight
forwarder" since he is responsible for the consignment from the time he has secured it by canvassing for
it to the point it is to be delivered to the consignee at its final destination.

4.2 The freight forwarder's role includes:

 Advice on special requirements of foreign countries.

 Advice on packing, marking, etc. to comply with Customs rules and regulations, especially in
other countries. In case of dangerous goods special care has to be taken.
 Arranging for routes and vessels. This includes preparation of detailed cost estimates.
 Reserving space and co-ordinating all forms of transport to convey goods from the premises
of his client to the destination.
 Preparing all necessary documentation.
 Arranging customs clearance
 Arranging warehousing
 Providing packaging solutions as required
 Various other statutory requirements

4.3 Transportation today is much more specialized and complex activity. Earlier there were very few
options. Hence, decision making was simple. Today in the chain of transportation various modes of
transportation, i.e., by road, rail, sea and air are involved. These are chosen according to the cost of
transportation that can be borne by the client and urgency of delivery of the goods.

4.4 Consequently the task of choosing the correct chain of transportation has become a specialized
job. This is where the freight forwarder comes into the picture. The shipper/cargo owner looks for
expertise to chalk out the delivery of his cargo in a cost- efficient manner. Thus, freight forwarder's
knowledge has to be extensive.

4.5 If the freight forwarder is dealing with a group of exporters and each of the shipments are less
than container load (LCL) then he tries to consolidate the cargo to make up an FCL. Thus, he is also called
a consolidator. His profit lies in the differential in the freight he (the consolidator) pays to the carrier on
FCL basis and the freight he charges from his exporters on LCL basis.

4.6 He may issue each customer a certificate of receipt that may contain the contract of carriage
between him and the exporter, i.e, a "House Bill of Lading". It is also known as a "Groupage Certificate".
The house bill of lading is issued subject to standard trading conditions of the freight forwarders
association to which he belongs such as "International Federation of Freight Forwarders Associations
(FIATA)". The freight forwarder will enter into a separate contract for carriage with the liner operator,
i.e., carrier of FCL. Thus, for the carrier the freight forwarder is the shipper and the freight forwarder will
obtain a bill of lading from the carrier.

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4.7 At the destination, freight forwarder's agent will receive the cargo from the carrier on discharge
of original B/L of carrier and break-bulk the consignment and distribute the goods to the concerned
consignees on surrendering of duly discharged original freight forwarder's house bill of lading.

4.8 Here it will be prudent to point out that the banks do not accept the house bill of lading for credit
unless authorized by the shipper. (The banks will accept the document only if it is a FIATA-FBL which is a
negotiable combined transport bill of lading. But to use this, the freight-forwarder needs to secure the
approval of FIATA.)

4.9 Most freight forwarders in India are associated with the Federation of Freight Forwarders’
Associations in India (FFFAI) which is the Apex Body and the Sole Representative of 24 Member
Associations from all over India representing 5000 Custom Brokers and Freight Forwarders (employing
over 1,00,000 people) and controlling ninety per cent of India’s international logistics trade. In addition,
organizations who are directly or indirectly connected with freight forwarding, shipping and commerce
are also associated with FFFAI.

5.0 MULTIMODAL TRANSPORT OPERATOR:

5.1 Containerized service is possible from an interior point (consignor's premises) in one country to
any interior point (consignee's premises) in another country against a single freight under one document,
i.e. Combined Transport Document. This single freight includes freight charged for all modes of transport,
be it inland, ship, or even air. This is called multimodal transport or intermodal transport and is very
popular in industrialized countries.

5.2 According to the MT Convention there are different types of transport operators. They are vessel
operating multimodal transport operators (VOMTOs) or non vessel operating multimodal transport
operators (NVOMTOs).

5.3 The multimodal transport operator means "Any person who on his own behalf or through another
person acting on his behalf concludes a multimodal transport contract and who acts as a principal, not as
an agent or on behalf of the consignor, of the carriers participating in the multimodal transport
operations, and who assumes responsibility for the performance of the contract."

5.4 As per the MT Convention the MTO would have to assume genuine through liability for the whole
transport covered by the contract.

5.5 In general, the inland transport services are provided by the following operators:

 Freight forwarder.
 Rail truck operator.
 Sub-carrier of shipping companies providing services as ancillary to sea transport operator
approved by conference rules.

5.6 According to THE MULTIMODAL TRANSPORTATION OF GOODS ACT (MMTG Act 1993) as amended
in 2000, it extends to the whole of INDIA with the exception of the state of Jammu & Kashmir. To become
a multimodal transport operator, one needs to be registered under this act. This is done by means of an
application and must satisfy some requirements, mainly that the applicant is a shipping company or a
company in business of freight forwarding with minimum turnover of 50 lakhs INR either in the last

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financial year or having an average annual turnover of 50 lakhs INR during the preceding 3 financial years
as certified by a competent chartered accountant. The applicant should also have offices or agents or
representatives in not less than two other countries. When these conditions are satisfied a certificate is
granted to carry on or commence the business of multimodal transportation. A “multimodal transport
document” is issued by the MTO acting as a carrier for the Merchant. The document issued can be a
negotiable or a NON Negotiable in nature.

5.7 The larger freight forwarders in India are multimodal transport operators. Most of them are a part
of an association “AMTOI” (Association of Multimodal Operators of India) which was established in the
year 1998.

5.8 The main objects of the Association are as follows:

• Organize Multimodal Transport Operators at national level.

• Study the issues faced by MTOs and seek resolution with appropriate authorities.
• Promote multimodal transport services in foreign trade.
• Improve the quality of such services and reduce transaction costs.

6.0 SALE AND PURCHASE BROKER:

6.1 A sale and purchase broker is a person who negotiates the terms for the sale of ship on behalf of
the buyer or the seller.

6.2 The sale and purchase of vessels is rather complex and requires a thorough knowledge of the
freight market combined with construction of ships, that is, the age, condition, type, compliance with the
present day to day rules and regulations and new rules the vessel would have to comply with in the future.

6.3 Sale and purchase can be divided broadly into three segments:

 New building vessels.

 Second-hand vessels, namely, for trading.
 Vessels for scrap.

6.4 In case of newbuildings, the buyer or the shipyard take the help of sale/purchase brokers who are
specialized for newbuilding business and also act as financial consultants to chalk out the terms of
payment.

6.5 The second-hand market is highly competitive and secretive. Often unknown/ undisclosed terms,
or "price believed to be in the region of", are used.

6.6 Thus, there is no clue of the market, unless help of a broker is taken. Here the broker's role is not
that of passing judgemental opinion but to bring to the notice of the buyer any abnormal condition or
history of the vessel.

6.7 On conclusion of a second-hand sale, the seller's broker draws up an agreement which is the
standard form known as the Sale Form 1983. He arranges to have documents delivered for trading and
insurance cover, if any, at the time of delivery of the vessel.

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6.8 In case the broker requires to register the vessel in the new owner's name then he has to comply
with the formalities dealt with in detail in the sale and purchase of the ship's contract.

6.9 In case of sale of a vessel for scrap, it is relatively simple. It is carried out by execution and delivery
of a Bill of Sale under seal. This Bill of Sale is exchanged for release of deposit and bank draft for the
balance payment.

7.0 CLEARING AND FORWARDING:

7.1 Customs House Agent (CHA) is an absolute necessity for any kind of import-export trade.
Process all the documents required for export-import trade through from Customs on behalf of shippers
by paying the requisite customs duty.

7.2 The Clearing & Forwarding process is marred due to cumbersome customs procedures involving
high volume of paper work which is getting changed now into EDI format.

7.3 Remuneration is based on clearance of shipment pro-rata basis and not normally on any
contractual basis unless exceptions are there for project related shipments.

7.4 In India, there are associations for the CHA or being referred to as Custom Brokers globally. An
example of the association is the BCHAA is the association formed in 1937. Currently BCHAA is known as
BRIHANMUMBAI CUSTOM BROKERS ASSOCIATION (BCBA):

• Today, it is the largest Association of Custom Brokers in India. With a strength of over 1,800
members and their 1,00,000 employees. With this strength, the entire EXIM Trade at JNPT, MBPT,
and Air Cargo Mumbai is handled by our members carrying out the work pertaining to Customs
Clearance, Shipping, Air Freight, Port-related activities.

• Promotes and enhances the interests of the CHA’s in all matters including Inland, Foreign Trade,
Shipping, Transport, Banking, Warehousing, Insurance and allied subjects.
• Train and constantly upgrade its members’ capability to cater to their customers and cope with
the global competition.

• Build a common platform of all its members and present challenges and issues with governmental
agencies and other trade partners.

8.0 SHIPPING AGENT:

8.1 Though this is not a lesson on law; students should always remember two important rules of
agency:

Whatever a person can do personally, he can do through an agent. The rule is of course subject to
certain exceptions, like acts of marriage, which are personal in character.

He who does an act through another does it by himself (qui facit atium facit per se). In other
words, subject to certain conditions, the acts of an agent are the acts of the principal.

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9.0 PORT AGENTS:

9.1 Port Agents are those which look after the tramp ships, those that are operating on a charter party
rather than a liner service. Their remuneration is always an agency fee.

9.2 The duties of an agent will vary depending upon the ship, cargo and port, besides of course, what
precisely his principal wants him to do Notwithstanding the same, the reason for requiring an agent will
always be to look after all the needs of the ship and her personnel while she is arriving at, staying in and
departing from the port. It would be impossible for the principal to take care of the needs of the ship and
her personnel at ports all over the world. Hence, someone who is akin to local conditions besides having
an establishment has to be appointed to do the job.

9.3 The first thing an agent must do is to identify that the principal. This is very important because
the agent will spend substantial amounts and establishing where the money is coming from has to be a
priority. At this stage you may easily say that the principal can be none other than the ship-owner. This
would be largely true, but what if the ship is on time charter? In such a situation the time-charterer is the
principal and that is why in legal terms he is referred to as the “Disponent Owner”.

9.4 If you are clear on the above, it would be right to state that the principal for whom the agent is
working is the person who pays him.

9.5 Talking the case of a time – charter, where the principal is the time-charterer, the ship-owner may
want certain things to be done, such as repairs, crew changes or mandatory certification, for which he
may need help at a foreign port. In such a situation there would be no contractual relationship between
the agent and the ship-owner. What should the agent do if he is requested to carry out such jobs? The
agent may carry out the above mentioned jobs which do not concern the time-charterer. In case however,
the jobs require extensive time and money, the following remedies would be available to the agent:
Separate contract between ship-owner and agent with a fee spelt out.

9.6 If there is a conflict in the job being performed, the only thing, which the agent can do, is handle
the situation skillfully and clarifying his position to both the parties. In case the conflict cannot be resolved,
then the agent has to revert back to working only for his principal – the time charterer, and the owner
would have no option but to appoint a separate agent.

9.7 With regard to voyage charterers, one point to be noted here is that some charter forms contain
the words “vessel to be consigned to “charterers agents” or “charterers nominated agents”. This means
that the ship is on a voyage charter and the agent would be nominated by the charterers. For clarify, if
would be worthwhile repeating that the agent whether nominated by charterers or not will always is
responsible to the owner or disponent owner. Nevertheless, when such an appointment is made, the
charterer would always want something in exchange, having nominated the agent and got him the
business. The agent who cannot handle such a situation should ideally decline the appointment.

9.8 The question which arises from the above is as to why a “charterers agent” is required? There
could be several reasons:

9.9 In tanker charters, jetties cost millions of dollars and charterers want to appoint agents who have
knowledge of the trade. In might sound stranger, but charterers are sometimes too jealous of their
reputation to risk dealing with agents who would attract complaints from owners.
To protect trade secrets, i.e. for maintaining confidentiality.

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9.10 Hence, in a situation like the above, there is no contractual relationship between the charterer
and the agent but the former does expect a quid pro quo. Therefore, the agent has to ensure that there
is no conflict of interest between the charterer and the owner. In theory this sounds simple. However,
there are many cases when the agents keep favouring the charterers and the owners remain a dissatisfied
lot. In such a situation the owner is left with no choice but to appoint a “supervisory agent”. The
supervisory agent normally charges half of the normal agency fees and is expected to represent the
owners in any dispute, besides looking after the requirements of the vessel. Owners do not generally like
the clause of “charterers agents”, especially when they have no means of checking the financially viability
of the agent.

10.0 Responsibilities of Shipping Agents Include:

 Ensuring a berth for the incoming ship.

 Arranging for the pilot and the tugs if necessary.
 Drawing up the documents for the customs and harbour services.
 Arranging for the necessary ship fresh water / provisions.
 Arranging for the necessary doctor for the crew for any medical assistance.
 Arranging for storage bunkers if these are needed.
 Arranging for necessary repairs.
 Conveying instructions to and from the ship owner.
 Organizing the supply, transport and the handling of the goods.
 Organizing the necessary contacts with the stevedores.
 Collecting freights, cargoes.
 Contacting shippers and the receivers of the goods.

10.1 In the case of damage to cargo or the ship, the shipping agent also makes the necessary
arrangements (at the request of the ship's master or owner) with the insurance company, and for nautical
inspections and the services of experts or surveyors, etc.

10.2 The Agent is also required to deal with cargo claims. The department doing this work is
unproductive as far as earnings are concerned but goes a long way for public relations.

11.0 LINER AGENTS:

11.1 Liner Agency unlike the Port Agency involves a wide variety of skills and involves a large amount
of manpower. Further, it is always based on a contract specifying the duties and remuneration of the liner
agent in detail. While quite a large amount of work involved would be of a clerical nature, there would be
other tasks that would require an ability to think and execute within the framework of the contract.

11.2 Before discussing the duties of a liner agent, it would not be out of place to mention that the
International Transport Intermediaries club has calculated that delivery of cargo without original Bill of
Lading represents the largest area of claims against agents. The second largest claim pertains to reefer
containers not being set at correct temperatures or the agent’s failure to arrange for the reefer containers
to be plugged in whilst at the port area. Accidental documentary errors are another source of claims. This
consists of errors by the agents in preparing Bill of Lading, Cargo manifests or other documents. A “freight
prepaid” stamp could be applied as an oversight when the freight has actually not been paid.

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11.3 A liner agent not only does all what is listed above for the port agent, but a lot more. Some of the
additional functions are listed below:

11.4 A liner agent might have to handle hundreds of consignments so that discussions with stevedores
start well before the ship arrives. Arranging stowage is important so that right cargo is discharged at each
port. Besides, a suitable berth has to be arranged along with facilities like transit sheds if required.

11.5 Liner agency requires advertising and active salesmanship. The marketing of space in liners is just
like selling an actual physical product. Competition being fierce, a sales force is employed. Unlike for tramp
agents, dealing with more than one principal is a huge problem in the same trade.

11.6 After canvassing for the space, actual bookings are made in the offices by personnel who have to
answer all sorts of queries from their clients including the calculation of the freighting cost.

11.7 As you would realize that every cargo will have a Mate’s Receipt and there will be as many
numbers of Bills of Lading, three in original and sometimes many more copies. Hence, the paper work at
the Liner Agents office is tremendous. At least one copy of the B/L is retained by the agents for preparing
the Manifest, which is a comprehensive list of all the cargo in the ship. Before being signed each B/L would
be checked against the Mate’s Receipt by the agent and then each B/L freighted.

11.8 If the freight is paid in advance then the same has to be collected and ‘freight pre-paid” to be
stamped on the B/L.

11.9 With conventional cargo the agent simply takes the booking and advises the shipper as to which
shed he has to move his cargo. With containerization the agent having taken the booking, then arranges
f+or the containers. The movement of containers, therefore, needs to be monitored.

11.10 If a house to house service has been requested, then it is for the agent to ensure that the container
moves from the Depot to the premises desired. If the cargo is in the form of LCL shipments then it is for
the agent to ensure that the same is consolidated.

11.11 On receipt of the Manifest, the agent will notify all the parties and the B/L holders will present
themselves at the Agent’s office. If freight is payable at destination, the same will be collected. Thereafter,
the Agent will issue the Delivery Order.

11.12 The above list is only indicative and not comprehensive. Students are advised to add the tasks of
a liner agent to the list.

11.13 You would observe from the above that the job of a liner agent is far fetched from that of a port
agent. It starts well before the ship arrives and continues much later. Since the agent is paid on a
commission basis, Marketing, Sales & Branding form part of the job. A sample distinction between a Port
and a Liner Agent is provided below:

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 LINER AGENT PORT AGENT
1 Appointment By written agreement detailing Mostly by Email. Detail of
duties and commission duties generally not
mentioned
2 Type and authority General Agent having authority to Special Agent having
act on all matters concerning a authority to act for some
particular trade or business. The particular purpose or
authority continues beyond one vessel. It generally does not
port and vessel extend from port to port
3. Remuneration Commission received on a % of A fee based on a fixed scale
freight on the inward and outward of charges
cargo. May also receive a regular
agency work and remuneration
4 Manpower Large numbers required having Lesser numbers required
wide variety of skills. Requires a lot
of clerical work
5 Area of functioning Besides being port based, many Always port based taking
functions at office including care of vessel/ personnel
advertising, canvassing for cargo, needs
booking space etc.
6 Type of cargo Hundreds of different types of Homogenous Generally one
cargo or containers filled with a
wide variety of cargo
7 Principal More than one principal in same More than one principal in
trade almost an impossibility same trade quite common

12.0 DUTIES OF THE AGENT:

12.1 To represent the Principal in the Territory, using his best endeavours to comply at all times with
any reasonable specific instructions which the Principal may give, including the use of Principal’s
documentation, terms and conditions.

12.2 In consultation with the Principal to recommend and/or appoint on the Principal’s behalf and
account, Sub-Agents.

12.3 In consultation with the Principal to recommend and/or to appoint on the Principal’s behalf and
account, Stevedores, Watchmen, Tallymen, Terminal Operators, Hauliers and all kinds of suppliers.

12.4 The Agent will not be responsible for the negligent acts or defaults of the Sub-Agent or Sub-
Contractor unless the Agent fails to exercise due care in the appointment and supervision of such Sub-
Agent or Sub- Contractor.
12.5 Notwithstanding the foregoing the Agent shall be responsible for the acts of his subsidiary
companies appointed within the context of this Clause.

12.6 The Agent will always strictly observe the shipping laws and regulations of the country and will
indemnify the Principal for fines, penalties, expenses or restrictions that may arise due to the failure of
the Agent to comply herewith.

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12.7 For more information on the role of an Agent, visit the below link to get the full details under the
STANDARD LINER AGENCY AGREEMENT (SLAA) as defined by (FONASBA) The Federation of National
Associations of Ship Brokers and Agents

https://www.fonasba.com/wp-content/uploads/2012/02/SLGAA-2001-FINAL.pdf

13.0 E-FREIGHT PLATFORMS:

13.1 E-Freight platforms provide all services required for international shipping and act as a
intermediary for the Exporters and Importers. The scope of their service offering includes:

1) Getting competitive rates from Shipping Lines and or NVOCC.

2) Transportation services
3) Customs clearance as required.
4) Shipment Tracking from Ex-Warehouse to Door.

13.2 Exporters and Importers have to register with them and they act as a connecting link in the
shipping industry.

13.3 Apart from Exporters and Importers, even service providers can log on to this platform
irrespective of whether they are Shipping lines, Custom brokers, NVOCC and offer their services via these
portals.

13.4 The Shipping & Logistics industry is going through a transformation and going digital is the key for
any business.

13.5 The main aim of these freight portals is to change the way the business used to be done
traditionally and to usher the Shipping & Logistics industry into the digital era, making global shipping
faster, more cost-effective and seamless.

ooooooo

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 SELF EXAMINATION QUESTIONS
1. Define the term "Shipbroker".
2. Write a note on the different types of shipbrokers and their areas of specialization.
3. How does a shipbroker safeguard his principal's interest?
4. What are the functions of a freight broker?
5. Explain the role of a freight forwarder.
6. What is a house bill of lading? When do banks accept it?
7. Define "CHA" and "Chartering Agent".
8. State the duties of a sale and purchase broker.
9. Write a note on a multimodal transport operator.
10. What are the objectives of AMTOI.
11. State the two important rules of "Agency".
12. How do port agents differ from liner agents?
13. What stand should a port agent responsible to a time-charterer take when approached
by a ship owner to look after some of the latter's interest in the port?
14. Why is it that in certain voyage C/Ps it is obligatory for a charterer to nominate a port
agent?
15. Differentiate between a port agent and a liner agent.
16. Under what circumstances is an owner compelled to appoint a "supervisory agent"?
17. Why a liner agency involves more skill than a port agency?
18. Explain duties of an agent and narrate with examples why co-ordination is a must for
carrying out his duties.
19. If a shipowner wants a disponent owner's agent to carry out certain jobs, is he under
obligation and what options are available to him.
20. Explain the terms:
21. Disponent owner.
22. "Qui facit alium facit per se."

RECOMMENDED BOOKS FOR READING:

1. Shipping Practice -- Stevens & Butterfield, 11th Ed., 1981.

2. Sea Transport -- P. M. Alderton, 4th Ed., 1995.

3. The Law of Contract – Dr. (Mrs.) Nilima Chandiramani, 1st Ed., 1996-97.

4. Elements of Shipping -- A. E. Branch, 7th Ed., 1996.

5. Sea Trading Vol. III (Trading) -- W. V. Packard, 1st Ed., 1986.

*************

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SHIPPING PRACTICE FIRST YEAR
LESSON 12

SHIPPING DOCUMENTS

1.0 PROFORMA INVOICE:

1.1 A proforma invoice is a preliminary bill of sale sent to buyers in advance of a shipment or
delivery of goods. The invoice will typically describe the purchased items and other important
information such as the shipping weight and transport charges.

1.2 Pro forma, Latin for “as a matter of form” or “for the sake of form,” invoices often come into
play with international transactions, especially for customs purposes on imports.
A proforma invoice specifies the following:

 The buyer and seller in this transaction.

 A detailed description of the goods.
 The Harmonized System classification of those goods.
 The price.
 The payment term of the sale, which would typically be expressed as one of the INCO
Term.
 The delivery details including how and where the goods will be delivered and how much
that will cost.
 The currency used in the quote, whether it’s U.S. dollars or some other currency.

1.3 A pro forma invoice differs from a simple price quotation because it is a binding agreement,
although the terms of sale are subject to change. Businesses in virtually all industries use pro forma
invoices to satisfy their internal purchasing-approval process. Pro forma invoices streamline the sales
process by eliminating additional back-and-forth after a sale goes through, as all terms have been
agreed to up front.

2.0 PACKING LIST:

2.1 The packing list confirms the contents of a shipment as it left the exporter's premises.
It indicates weights, measures and the piece count (i.e., the number of cartons or cases) in that
shipment.

2.2 Packing lists are not required by the customs laws of every country, but they can be crucial to
the successful completion of an exporting process as it would be required for various other
requirements.

2.3 Packing List should include:

 A product description.
 A reference to the relevant commercial invoice number and/or item number.
 The type of package(s) (e.g., a box, a carton, vials, etc.).
 The net and gross weights of each package stated in pounds or tons and converted into a
metric equivalent, except where the buyer or government regulations require otherwise.
 The legal measurements expressed in inches and cubic feet and converted into a metric
equivalent, except where the buyer or government regulations require otherwise.
 Package markings.
 Buyer and seller references.
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2.4 Following are the importance of a Packing list and uses:

 It is a count of the product being released and shipped to the buyer's facility.
 It identifies detail required for a CERTIFICATE OF ORIGIN.
 It provides the detail required by the law for the Electronic Export Information filing in the
Automated Export System (AES).
 It supports issuance of a MATERIAL SAFETY DATA SHEET if the goods are deemed
hazardous.
 It is used to create a booking with the international carrier and subsequently the issuance
of the BILL OF LADING. (Part of the documents required by the customs)
 The importer's customs broker will use it to enter the goods into their country as it
contains required detail.
 In the event of loss or damage to the goods while en-route, it becomes a document that
will be used to SUPPORT AN INSURANCE CLAIM.
 It provides the buyer with the ability to accurately tally the product that they receive, and
subsequently reimburse the exporter (seller) of the goods.
 It may be used in support of reimbursement under a LETTER OF CREDIT.

3.0 CERTIFICATE OF ORIGIN:

3.1 A certificate of origin (often abbreviated to C/O or CO) is a document widely used
in international trade transactions which attests that the product listed therein has met certain criteria
to be considered as originating in a particular country.

3.2 A certificate of origin is generally prepared and completed by the exporter or the manufacturer
and may be subject to official certification by an authorized third party. It is often submitted to a
customs authority of the importing country to justify the product's eligibility for entry and/or its
entitlement to preferential treatment.

3.3 Normally the issuing authority can be one of the following institutions:

 Chambers of commerce.
 Customs authorities.
 Other government bodies or agencies assigned by the agreement, normally belongs to the
Ministry of Trade.

3.4 The Certificate of origin issued by the Chamber of Commerce could be of 2 types:

 Non-Preferential Certificates of Origin

3.5 These certificates certify that the goods’ country of origin does not qualify for any preferential
treatment. These are the main type chambers issue, and they’re also known as ordinary or generic
certificates of origin.

 Preferential Certificates of Origin

3.6 This type of certificate certifies that goods are subject to reduced tariffs or exemptions when
they are exported to countries extending these privileges.

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4.0 SHIPPING BILL:

4.1 Shipping Bill is an important document, required by the customs authorities for clearance of
goods. The customs authorities endorse the duplicate copy of the shipping bill with "Let Export Order"
and "Let Ship Order". After the clearance or customs, exporter can load the goods on ship, the shipping
lines insist on the Shipping bill be endorsed by the customs prior acceptance for READY TO LOAD on
board their vessels. Shipping bill endorsed by the customs authorities facilitates the exporter to claim
incentives such as excise duty refund and duty drawback.

4.2 The Shipping Bill is prepared by the exporter or his representative (Customs Broker) and it
contains:

 Name of the vessel.

 Name of the port of discharge
 Country of final destination
 Exporter's name and address
 Details about packages, numbers, quantity and details about each case
 FOB Value of the Cargo
 Total number of packages with the weight and value.
 Name and address of the importer.

4.3 Shipping bills are of following types:

 Duty free shipping bill - no duty or cess applicable.

 Dutiable shipping bill - goods subject to export duty /cess.
 Drawback shipping bill.
 Shipping bill for shipment ex - bond - for goods imported for re – export.

4.4 The following documents are required for the processing of the shipping bill:

 GR forms (in duplicate) for shipment to all the countries.

 Four copies of the packing list mentioning the contents, quantity, gross and net weight of
each packages.
 Four copies of invoices which contains all relevant contents, particulars like number of
packages, quantity, unit price, total fob, total CIF full value and full description of goods
etc.
 Contract no. letter of credit number, purchase order number of the overseas buyer.
 AR4 (both original and duplicate) and invoice.
 Inspection / Examination certificate.

5.0 BILL of ENTRY:

5.1 Bill of Entry is a declaration form made by the importer or his clearing agent in the prescribed
form under Bill of Entry Regulations, 1971 on the strength of which clearance of imported goods can
be done.

5.2 When goods are imported into a country, customs duty has to be paid by the importer as per
the applicable rules.

5.3 The importer prepares the Bill of Entry declaring the value of goods, quantity' and description.
Customs authorities may ask the importer produce the invoice of the exporter, broker's note and
insurance policy to satisfy about the correctness of value of goods declared.

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5.4 For the purpose giving information, goods are classified into three categories,

(1) Free Goods: These goods are not subjected to any customs duty.
(2) Goods for Home Consumption: These goods are imported for self-consumption.
(3) Bonded Goods: Where goods are subject to customs duty, till duty is paid, goods are kept
in Bond.

5.5 Contents of Bill of Entry:

1. Name and address of importer.

2. Name and address of exporter.
3. Import licence number.
4. Name of port where goods are to be cleared.
5. Description of goods.
6. Value of goods.
7. Rate and value of import duty payable.

6.0 TALLY SHEETS:

6.1 Tally is the recording of cargo coming into and going out of a ship (or warehouse or container).

6.2 Tallying is carried out by persons who are a part of the stevedore staff or by independent
operators known as “tally clerks”. The tally clerks issue documents called “tally-clerks” receipts or
“tally sheets”.

6.3 The tally sheets contain information such as the number of packages, their marks and
numbers, port, and any remarks regarding condition of the good discharged.

6.4 The information in tally sheets is inserted on the mate’s receipts and bills of lading.

6.5 The process of tallying requires a good deal of care. Many claims arise due to wrong tally on
the basis of goods which have never been shipped.

6.6 In Indian ports when a claim is lodged for short-landing, the port authorities will issue to the
shipping company tally sheets and a remark list. While the tally sheets will record the quantity of cargo
landed, the remark list will show the condition in which the cargo is landed.

7.0 MANIFEST:

7.1 A manifest is a COMPLETE list of the goods shipped at any port for one or more destination
ports. It is usual for separate manifests to be made up at each loading port, and these must be an
accurate list of each Bill of Lading, showing names of shippers, marks, description quantities and names
of consignees.

7.2 It is always helpful if any long lengths and heavy lifts are clearly marked so that they are readily
seen on the manifest. Hazardous goods are usually manifested separately.

7.3 Manifests may be “freighted” or “unfreighted”. The former is a manifest extended to show
the unit freight and the total freight per Bill of Lading and is essential to a discharge port agent who
has freight “to collect”. Again it is usual for freight to be totalled and any advances or part prepayments
of freight to be clearly shown. The “unfreighted” manifest shows no details or freight.

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7.4 Manifests are needed by the ship, owners, customs, port authorities, stevedores and tally
clerks (at both ends), as well as by the agents and the freight brokers, if any.

7.5 A manifest must be an accurate summation in every respect of the Bills of Lading issued at the
port of issue and therefore of the cargo shipped at that port.

8.0 MATE’S RECEIPT:

8.1 This is a document issued by the chief officer or the first mate of the ship. He is the officer
responsible for cargo. The document is issued by him after the cargo is tallied into the ship by tally
clerks. The shipper or his representative then takes the mate’s receipt to the master or the agent to
exchange if for a bill of lading which incorporate any conditions and remarks inserted into the mate’s
receipt.

8.2 Whenever a mate’s receipt is issued the shipping company will not issue the bill of lading until
such time the mate’s receipt is given in exchange.

8.3 The ship’s agent must ensure that any comments by the mate as to condition, numbers,
quantity, etc. appear in the respective Bill of Lading, so as to protect the Owner from unwarranted
claims for damage or shortage when the cargo is delivered by the ship at discharge port.

8.4 In Modern days, the document known as the “Mate’s Receipt” is not signed by the mate of the
ship but by some person in the shore office of the shipping company or its agents, although the name
of the document remains the same.

8.5 In a charterparty a clause requires the master to sign bills of lading as presented but in
accordance with mate’s receipts. If it is impractical for the master to sign the bills of lading he can
authorize the port agents to do so on his behalf, but also in accordance with the mate’s receipts.

8.6 The “receipt” function of this document is similar to the bill of lading function of receipt for
cargo on board the ship. This has the effect of confirming that the carrier is responsible for the goods
and is the first evidence of the condition and quantity of the goods when they were received.

9.0 STATEMENT OF FACTS:

9.1 One of the prime functions of an agent is to produce a written record of events occurring
during a vessel’s visit to his port- a port operations log – commonly termed a “Statement of Facts”. In
this are recorded a ship’s arrival date and time when she berthed or shifted to another berth; entered
dry-dock; visited the bunker station; worked cargo and parted; the time Notice of Readiness was
tendered and accepted; the weather conditions, etc.

9.2 No matter the reason for a vessel’s visit to a port, whether it is for dry docking/repairing,
bunkering, cargo-working, whether on voyage or timecharter, a port agent must prepare a Statement
of Facts form to be forwarded to his principal upon the ship’s departure.

9.3 Many agents use their own form this purpose, but a standard document is available from
BIMCO (The Baltic & International Maritime Council).

9.4 To avoid unnecessary disputes, interested parties to a vessel’s visit to port, e.g., the Master,
Shipper/Consignee and Agent sign the Statement of Facts. If one or other of the parties has an
objection to the contents of the Statement of Facts form he is persuaded to sign “under protest”,
adding a statement clarifying reason for his objection.

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9.5 The Statement of Facts is a vital document and requires conscientious attention to detail by
the port agent.

10.0 TIME –SHEETS:

10.1 A time-sheet is a document used for voyage-chartered ships showing laytime utilised, taking
into account the tendering and acceptance of the notice of readiness; the commencement of laytime;
interruptions to laytime; e.g. bad weather, holidays, strikes, breakdown of cargo-handling equipment
and the termination of laytime/commencement of demurrage.

10.2 Time-sheets are based on information supplied from the Statement of Facts form and by
interpretation of laytime clauses in the voyage chaterparty/sales contract. They are usually drawn up
by the shipowner/disponent owner and/or by the charterer, or by both parties used to support claims
for dispatch or demurrage.

10.3 As in the case of Statements of Facts, BIMCO produces a Standard Time Sheet form available
for worldwide use.

11.0 NOTICE OF READINESS:

11.1 This is defined as “Notice to the charterer, shipper, receiver or any other person as required
by the charter that the ship has arrived at the port or berth as the case may be and is ready to
load/discharge cargo as stated in the charter party.”

11.2 The whole purpose of a notice of readiness is to inform the shippers or consignees that the
vessel is presently ready to load or discharge and the period of time within which they have agreed to
load or discharge the vessel is measured from that moment.

11.3 Once a ship has been granted pratique, entered at the custom house, and had her holds
inspected and passed, there should be nothing to stop the Master from tendering notice of his vessel’s
readiness to commence cargo operations.

11.4 If the vessel is unable to obtain free pratique or enter at the custom house, or is unable to pass
an inspection of her cargo holds because, for example, the port is congested and the ship cannot enter,
then possibly the Master will still be allowed to tender Notice of Readiness in accordance with charter-
party terms. The golden rule, in cases of doubt, is for the ship’s master to tender notice of his vessel’s
readiness where the delay is caused by reasons beyond the ship’s control. If the notice is accepted, all
is probably well from the owner’s point of view, and time should commence in accordance with the
charter-party terms. If the notice is not accepted in such circumstance, it is in the owner’s best interests
for the Master to tender readiness again the next day, and so on, since so doing may strengthen his
case.

11.5 Sometimes notice of a vessel’s readiness is tendered and accepted by radio or telegram, and
at other times, when it is possible to do so, in the form of a letter or specialized form. In the latter case
the notice is normally tendered by completion of a printed document that the owner will have supplied
to his ship as normal practice. The document is generally prepared by a ship’s master, although
occasionally by an owner’s port agent, and simply states that, at a certain date and time, the vessel is
ready to commence cargo operations in accordance with the charter-party terms and conditions.

11.6 The Notice of Readiness may be given orally, but there is normally an agreement in the charter-
party that notice will be written. Strictly speaking, it is not legally necessary to tender Notice of
Readiness (either oral or written) at a second or subsequent loading port or at any discharging port,

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although the practice has commonly evolved of written notice being tendered at every port of call at
which cargo operations are performed.

11.7 In many charter-parties found a clause to the effect that the Notice of Readiness can only be
tendered in office hours, or between certain specified times is given. It is therefore of paramount
importance to an owner that his master does all in his power to complete the formalities at the earliest
moment and tender Notice of Readiness as quickly as he can, in order that lay-time commences as
soon after arrival as possible.

12.0 DANGEROUS GOODS MANIFEST:

12.1 The International Maritime Dangerous Goods (IMDG) code is developed as a standard
international code for transporting (by sea vessel) dangerous goods around the world.

12.2 When transporting hazardous cargo certain documentation is required to ensure the cargo is
shipped safely. The health (and life) of port workers, transporters, ship crew and the cargo / vessel
itself depends on the documents being correctly and thoroughly filled in, shipping lines and the people
involved on the ground have no way of checking what is packed and have to base everything on what
is given in the documentation.

12.3 The Dangerous Goods Declaration is sometimes combined with the Container Packing
Certificate into one document, when combined these are generally known as the Multimodal
Dangerous Goods Form. The Dangerous Goods manifest is a summary of all the goods classified as
hazardous and carried on board with details pertaining to the shipments.

12.4 Following are the details contained in the IMO DANGEROUS GOODS MANIFEST which is
carried on board the ship and is an update at any given point of time of the details of HAZ cargo on
board.

12.5 These Manifest are updated for every port of call and handed over either electronically or in
printed form to authorities at every port of call for safety & security purposes.

12.6 Following are the contents of the DANGEROUS GOODS MANIFEST

 List of the quantities and location of all dangerous goods

 Container Number
 No. and kind of packages
 Proper shipping name
 IMO class
 UN number
 Packing Group
 Subsidiary risk(s)
 Flash point
 Marine pollutant
 Net mass / gross weight
 Net explosive quantities
 Stowage location
 Port of loading
 Port of discharge

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13.0 NOTE of PROTEST:

13.1 The Note of Protest is a declaration under oath by the Master of the ship. It covers
circumstances beyond master’s control which may cause/have caused loss or damage to the ship or
cargo or may have caused the Master to leave an unsafe port, which may render the owners liable for
legal action by another party.
13.2 It is a notarized statement obtained after a ship enters port after a rough voyage. Its purpose
is to protect the ship’s charterer or owner from liability for damage to the cargo, the ship or to other
ships in a collision, where this was caused by the perils of the sea (for example, bad weather).

13.3 This NoP has to be made before a notary public (public officer constituted by law), magistrate
(a civil officer who administers the law) or consul (diplomat) or other authority without delay and
within 24 hours of arriving at port.

13.4 When making the NoP, the Master has the right extend the NoP to cover unforeseeable
circumstances (vis a vis the NoP).

13.5 If the NoP is made in relation to the cargo, the same should be made BEFORE unloading the
cargo. This is done to exclude any room for legal liability directed towards the vessel for damaged
cargo.

13.6 If instructed by the owner, the NoP may be forwarded to all parties concerned with copies
kept with the owner and onboard.

13.7 NoP should be noted/is applicable to each port of discharge and not just for the first port of
call seeing as maritime trade involves cargo that might involve more than one port, i.e, same cargo
discharged at different ports

13.8 Note of Protest is applicable in the following cases:

 When the ship has experienced bad weather conditions during the voyage which may have
resulted in damage to the cargo.
 The ship is already damaged and it does not matter if further damage may be caused.
 Ventilation of the cargo was not carried out due to circumstances beyond the control of
the ship’s crew.
 The charterer(s) or the agent(s) commit a serious breach of the terms of the charter party.
This could include but not be limited to undue delays, refusal to load cargo, discrepancies
in the cargo mentioned as per charter party etc.
 The consignee fails to discharge cargo, take delivery or cover freight associated with the
cargo with vis a vis the charter party and the bill of lading.
 Post an incident involving General Average.
 Allowed by the charter party (included but not limited to) – refusal to pay demurrage (a
charge payable to the owner of a chartered ship on failure to load or discharge the ship
within the time agreed), berthing the vessel at an unsafe port etc.

13.9 Procedure for Noting Protests

 The witness must possess the knowledge pertaining to the circumstances causing the NoP,
the facts of which are sent to the notary public, magistrate, consul or as advised by the
agents.

 All documentation supporting the facts must be in possession as supporting proof to the
NoP such as the official log book, deck log book, engine log book etc. The NoP, when
printed, must be done as per the number of parties to which a copy is to be sent.

NOTE of PROTEST is a document that covers the Master and the owner from liability.
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14.0 LETTER of PROTEST:

14.1 Unlike a Note of Protest which is a declaration under oath by the Master of the ship, the LETTER
of PROTEST is issued when the Master of the vessel has to express his concern over certain occurrences
over which the contracting party will have some or full control.

14.2 This is issued by the MASTER of the vessel on the company’s letterhead with adequate facts
which are recorded in the official or respective Log books. Apart from the Master, it could be issued by
either of the contracting parties, e.g. Charterers representative to Master of the vessel.

14.3 Letter of Protest is applicable in the following cases:

 Difference between ships figures and Charterers B/L figures.

 Delay between Berthing and Commence Cargo Operations.
 Slow Loading or Discharging operations.
 RASH or Negligence of safety while operating the Ships Gear by shore stevedores.
 Delay during cargo operations.
 Delay in supplying Bunkers.
 Lack of Fender arrangements and Berth unsuitable for the ship.
 Delay awaiting documents thereby affecting departure of the ship.
 Delay connecting hoses between NOR & Commence cargo.
 Access – Shore gangway landing area due to shape of the pier.
 Difference between Ships / Barge figures for quantity supplied.

15.0 PORT CLEARANCE:

15.1 Outward clearance to unberth and sail out of a port is mentioned at Port Clearance. For
obtaining the port clearance, this needs to be applied minimum 6 hours prior to departure of the vessel
while observing local regulations.

15.2 The next known port of call must be clearly stated, Finally Port Clearance to be obtained from
Customs providing relevant documents like vessels certificates, copy of light dues, yearly continuity
bond undertaking on Rs 500.00 stamp paper. Last port clearance is an important document demanded
prior granting berthing approval at any port during the arrival formalities.

15.3 Port Clearance is applied by the vessel agent and it needs NOC from various parties, one of
them being the Immigration authorities and the terminal.

16.0 The ENTIRE FLOW OF DOCUMENTS from the time the cargo is ready till the time its shipped
on board the vessel can be stated as below:

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16.1 Invoice & Packing list contents are uploaded by the CUSTOM BROKER on the dedicated PORTAL
of the Customs – ICEGATE and thereby generating the SHIPPING BILL. ICEGATE - Indian Customs
Electronic Commerce/Electronic Data interchange (EC/EDI) Gateway provides e-filing services to the
trade and cargo carriers and other clients of Customs Department (collectively called Trading Partner).

16.2 In addition to e-filing, ICEGATE also provides host of other services like e-payment, on-line
registration for IPR, Document Tracking status at Customs EDI, online verification of DEPB/DES/EPCG
licences, IE code status, PAN based CHA data and links to various other important
websites/information pertaining to the Customs business.

16.3 The ICEGATE also provides 24X7 helpdesk facility for its trading partners. To ensure secure
filing, it is proposed to use digital signatures on the Bill of Entry and other documents/ messages to be
handled on the gateway.

STATEMENT OF FACTS:

MV MARINA VOY 1249R C-1978

Via No C 1978
Rotation No 38372 20-11-2012

IGM No 2049794 03-12-2012

P C No. / Dated 1984 03-12-12 to06-12-12

ARRIVED AT ROADS 04-12-2012 @ 03:12 hrs.

PILOT BOARDED 04-12-2012 @ 11:48hrs.
BERTHED - APM T 1 04-12- 2012 @ 13:30 Hrs.
COMMENCED OPS 04-12- 2012 @ 13:57Hrs.
COMPLETED OPS 05-12- 2012 @ 09:42 Hrs.
PILOT ON BOARD 05-12-2012 @ 13:45 Hrs. EXP.
VSL SAILED 05-12- 2012 @ ----Hrs.
NEXT PORT ETA (MUN) 06-12--2012 @ 18:00 Hrs.

ARRIVAL Departure
Nos of Tug used 2 2
DRAFT - (Fwd) 11:85 12:50
DRAFT - (Aft) 11:85 12:50

SHIPPING BILL:

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BILL of ENTRY

MATES RECEIPT:

137
CERTIFICATE OF ORIGIN:

138
DANGEROUS GOODS MANIFEST:

ooooooo

SELF-EXAMINATION QUESTIONS

1. Define the term “Notice of Readiness”. What are the conditions to be fulfilled
before NOR can be tendered.
2. What is the importance of issuance of a Mate’s Receipt to the
(a) The shipper and
(b) The Master
3. What information is contained in the ship’s manifest?
4. Write short notes on:
(a) Tallying
(b) Statement of Facts
(c) Time Sheets
5. Match items in list A with the items in list B.
List A List B
(a) Tally Sheets (i) List of goods shipped
(b) Notice of Readiness (ii) Useful for cargo claims
(c) Manifest (iii) Prepared by Chief Officer
(d) Statement of Facts (iv) Port operations log
(v) Vessel ready to load
(vi) Indicates laytime used

RECOMMENDED FOR FURTHER READING:

1. Shipping Practice – Stevens & Butterfield, 11th Ed., 1981.
2. Sea Trading Vol.1 (The Ships) – W. V. Packard, 1st Ed., 1984.
3. Bes’ Chartering & Shipping Terms – N. J. Lopez, 11th Ed., 1992.
4. Elements of Shipping – A. E. Branch, 7th Ed., 1996
************

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140
141
142
143
 APPENDIX – III

NOTICE OF READINESS

To Messrs. _________________________

Please note that the ship _______________________________________ nationality:

_________________________________ call Sign: _________ has arrived at
_____________________on ____________________ at _______ hours, and is in every
respect ready to commence loading/discharging a cargo of ________________________
in accordance with the terms and conditions of the Charter Party/Booking Note dated
_________

Time is to count as per the terms and conditions of the above mentioned Charter Party/Booking
Note.

Please confirm receipt of this Notice of Readiness by signing and returning the copy attached.

Place____________________ Date _______________ ________________Hours

_____________________
Master / Agent
___________________________
Charterer / Shipper / Receiver

*********************

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SHIPPING PRACTICE FIRST YEAR
LESSON 13

PROCEDURES FOR ENTERING & LEAVING PORTS

AND PORT SERVICES
1.0 Introduction:

1.1 The number of commercial ports in the World runs into several thousands. Their location and
geographical positions are different. Procedures and legal requirements at all ports are not standardized
although there are many factors in common.

2.0 Ship’s Papers:

2.1 A ship must carry the following papers, and the Master shall be required to produce them to
Customs. Immigration and Health Officers, Port State Control officers and officers of the Port
administration and your own consul –

a) Maritime Declaration of Health and current De-Ratting Certificate.

b) Ships Certificate of Registry (or ship’s register).
c) Crew list and crews declaration of personal belongings.
d) Ship’s articles.
e) Manifest of cargo.
f) Charter-party or bills of lading.
g) Official log.
h) List of dutiable stores (if any).
i) Load line certificate.
j) Statutory certificates required under the provisions of SOLAS, MARPOL LOADLINE & STCW
Conventions and their attachments such as records, records of disposal of oil and or garbage
etc.

2.2 The Maritime Declaration of Health is a certificate which states that the health of the vessel and
every person on board is in good condition, free from contagious diseases, there being no reason why the
vessel should not enter the port. The Master can obtain this certificate by radio from the Port Health
officer of the destination port. The Master gives a period of notice of arrival at destination port, declaring
the health of all on board is satisfactory and the port Health Authorities on arrival may grand “Free
Pratique.”

2.3 The De-ratting Certificate, which normally lasts 6 months, certifies that the ships crew has dealt –
the ship with an approved authority or themselves to free the ships of rats.

2.4 Ships Certificate of Registry. This contains all the details from the register, including gross and
registered tonnage. It is an evidence of title to the ownership and nationally of the Ship. This document
must always be carried on board.

2.5 The Ship’s Articles containers a description of the crew and the capacity in which each member
serves, length of voyage, amount of wages, time of commencement of voyage, and other provisions
depending on the nationality of the ship. This is the agreement between the master and his crew, and
must be referred to when signing on or signing off the crew.

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2.6 The Manifest is the list of cargo on board the ship, and gives the full particulars of contents, marks,
shippers and receivers. This is often described as an “inventory” of all cargo on board.

2.6.1 Whilst Charter-parties or bills of lading, under which the cargo is being carried are included in this
list it should be remembered that in may cases vessels leave a port without the manifest or bills of lading
on board. It is often found convenient to send these papers to the port of destination of the ship by airmail
or by courier. This procedure gives the Ship’s agents (at port of loading) additional time for the preparation
of documents and the documents are received at the port of destination some few days prior to the
vessel’s arrival, providing a saving of time at both the ports. As the manifest or bills of lading are only
required at port of destination no objections are raised if the vessel does not carry such documents
provided they are received at port of discharge before or at the time of arrival of the ship.

2.7 Official logs must be kept on every ship in the approved form. All entries made in these books
must be made as soon as possible after an occurrence, and signed by the master and mate, or other
member of the crew. Entries referring to illness must be signed by the Ship’s surgeon (if one is employed
on board), entries regarding wages must be signed by the master, mate and some member of the crew.

2.7.1 All entries in official logbooks are admissible as evidence in any proceedings in a court of justice.

2.7.2 Entries in the official log book consist of all records of crew’s conduct, wages, fines, any births,
marriages (Marriages can not be performed by the master now) or death. Happenings in regard to the
procedure of the ship are entered on the ship’s log.

2.7.3 A list of dutiable stores is carried on board for customs purposes. This is made up by a Ship’s
Officer and checked by the Customs Officer on Boarding the ship.

3.0 Procedure on Arrival:

3.1 On arrival at the Post of destination, the Master presents the Maritime Declaration of Health to
the medical officer of the port, who after satisfying himself that there is no objection to the ship – on the
ground of health – passes it in as “clean”.

3.2 The Rummaging Officer or Customs Preventive Officer comes on board and compares the list of
stores with the amount in the Ship’s various store rooms. By agreement, the dutiable stores are sealed
and remain so sealed whilst in port. He then searches the ship, seeking contraband as a preventive
measure against smuggling.

3.3 The Master applies to the pilot to bring the ship to the dock or berth. When the Customs Officer
on arrival a mater does not board the Vessel or his authorized agent is required to lodge all boarding
documents at a Customs Office as designated. In such case legal responsibilities of Masters and Agents
are not affected.

3.4 The forms specified may be different in each of the countries and their form numbers may differ.
Standardized forms are specified in the IMO’s Facilitation convention but in general they do not exceed
the following:

 General Declaration
 Cargo Declaration
 Ship’s Stores Declaration
 Crew’s Effects Declaration
 Crew list
 Passenger List
 Dangerous Goods list
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  Arms & Ammunition List
 In certain Countries, An Alcohol carried in cargo needs to be presented as Alcohol Manifest.
 The document required under the Universal Postal Convention for mail
 Maritime Declaration of Health Where appropriate
 Small Parcel List
 Self Declaration Deck Cargo

3.5 Form for deck cargo is a new form covering cargo on deck and in unregistered space as well as oil
fuel in double-bottoms or other ballast tanks. If a Vessel is not boarded on arrival, the Master or Agent
must lodge one copy of each form at the designated Customs. Office within 3 hours of arrival. Collections
will have discretion to adjust this period in special circumstances. In some port, these forms can be
transmitted by radio.

3.6 Report and clearance of Vessels will continue as usual. If the Ship is in ballast and coming inwards
a Custom House Report is needed. If the ship is with cargo, there is, in addition, the report and list of
dutiable stores; also

 Register.
 Stores List.
 Lights certificate.
 Tonnage slip.
 Pilotage slip.

3.7 Every ship must produce a light dues receipt either before entering or before leaving the port. No
ship is allowed to leave this port without the light dues being paid.

3.8 Light dues are payable at a fee which fluctuates so much per ton, and the money received from
this levy assists in the maintenance of all lights, lightships, light houses, beacons etc. around the coast.

3.9 Every ship, whether laden or in ballast, must report after arrival from any port abroad, or any port
in the country. Vessels from foreign ports which call at ports purely for bunker purposes, provisions or as
a port of refuge, are not required to report unless the vessel remains in the port for more than 24 hours
from the time of arrival.

3.10 Failure on the part of a master to report his ship makes him personally liable for a fine and all
goods, which are not reported, may be detained.

3.11 When a ship arrives or is expected to arrive out of legal hours for reporting, the Collector of
Customs may on receiving a request in writing , allow the cargo to be unloaded, prior to report being
lodged. This permission, however, does not relieve the ship its responsibilities of reporting within the
stipulated period.

4.0 Procedure for Leaving:

4.1 In the case of Vessel sailing outwards, the procedure is reversed. The Master must obtain a
shipping bill for stores, and present to the Custom House a report of the cargo he is carrying outwards
within the prescribed time. He must also produce the light dues receipt, and his clean Maritime
Declaration of Health before the clearance is obtained. The Master must appear in person or alternatively
appoint an agent, by signing Customs Form to make report or clear the vessel.

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4.2 The documents required for clearance are –

 Certificate of Registry
 Load line certificate
 Safety Radio / Telegraphy certificate
 Safety Equipment certificate
 Cargo Ship safety construction certificate
 Light bill
 Pilotage receipt (for foreign owned vessels only)

4.3 Application is then made for pilotage.

5.0 Port Procedures at Indian Ports:

5.1 Arrival and entry inwards of Vessels: A cargo manifest can be filed with Customs before the arrival
of the vessel. This would be permitted under prior entry procedures. A final entry would be made on the
arrival of the vessel. If such prior entry is not made, the cargo manifest of a vessel must be filed within 24
hours of the arrival of the vessel and the vessel entered inwards.

5.1.1 Following documents are expected to be filed with the manifest –

 Authorization from the Master to act as Vessel’s Agent.

 The register of the vessel
 Port Officer’s Entry certificate.
 Port clearance of the last port of call.
 Indian Coast Light dues receipt (if any)
 Statutory certificates.
 Guarantee and declarations as required under “Section 41, 42 and 97(2) of the Customs Act,
1962 or general guarantee.
 Sec. 41 Delivery of Export Manifest or export report;
 Sec. 42 – No conveyance to leave without written order from the proper officer of
Government,
 Section 97(2) – Master to answer all questions / charges (if any).
 Loading certificates – in case of bulk cargo (tankers, food grains etc.)
 Cargo Manifest and same bottom cargo manifest (if any)
 Declaration regarding opium and dangerous drugs.
 Special declaration regarding notified items (items notified by the government by notification
for import, for maintenance of security, public order, standards of deceases or for prevention
of smuggling, injury to economy, protection of plant life etc.)
 Declaration of the personal property of officers and crew.
 Crew List validated by Immigration on departure.

5.1.2 On all the above being filed and found in order, the person receiving it shall countersign the same
and enter thereon such particulars as required under the rules. Then the import General Manifest number
and date will be given (by the import Department) and Inward Clearance Certificate will be issued by the
Import Department (Section 29 to 38).

5.2 Entry Outward: For vessels taking export cargo or requiring ship’s stores, the vessel must be
entered outwards. Loading application can be filed 14 days before arrival of vessel (prior entry). It can as
well be filed on arrival of the vessel. The rotation number is given to the vessel by the Export department
on filling loading application.

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5.3 Clearance of Vessels: No Vessel shall leave the port without a written permission (viz. port
clearance). Application should be made at least 24 hours before the intended departure of the vessel.
Along with this application, the following documents are to be submitted to the Export Department of the
Customers-

(a) The Register of the Vessel.

(b) Statutory certificates.
(c) Inward clearance certificate.
(d) Income Tax clearance certificate, if proceeding to foreign port with export cargo.
(e) A declaration regarding dangerous drugs, opium etc.
(f) A bill of health from the Port Health Officer in respect of the Ship’s personnel.
(g) Stores List.
(h) Special declaration for notified items.
(i) Master’s authority issued in favour of the Agents.
(j) Certificate of payment of duty in case of transshipment cargo.
(k) Export manifest showing cargo for each port of loading under the following heads- free
goods, dutiable goods, bonded goods, drawback goods, ship’s stores in the above manner,
arms and ammunition – should be filed within 5 clear days from the date of obtaining the
written permission along with guarantee declaration required under section 41, 42 and 97(2)
or general guarantee.

(Source: The Customs Act, 1962 – Chapter VI: Provisions relating to conveyances carrying
imported or exported cargo).

6.0 Port Information – Masters should seek:

 Location: Latitude, Longitude, Country, Flat, Type of Port (natural / artificial, estuarial, river Rhine
etc).

 Port Limits: The seaward boundaries of the port within which a vessel is considered an “arrived
ship” and (subject to charter party terms) laytime will commence.

 Weather: The precautions necessary for seasonal winds etc.

 Tides: Availability of tidal information and its effect on depths in the channel and at berth.

 Documents: The matter of documentation is one of the most important items. Masters will be in
a position to prepare all necessary documentation before arrival and thus ensure speedy
clearance (eg. Number of crew lists, Passenger Lists, customs documents, Health Documents,
Manifests, Bill of Lading, Ship’s papers, Ship’s certificate etc). It is also necessary to know in
advance the number of copies the port authorities need.

 Pilotage: Manner in which vessel approaching the port applies for a Pilot. That is telegraphic
address, telephone number, facsimile number or telex number of Pilot station, amount of
advance notice of ETA required and VHF channel or frequency to be used when contacting Pilot
Vessel or Pilot Station. If possible the following information is made available:-

1. Description of pilot vessel.

2. Particular light or sound signals to be made by vessels requiring a Pilot
3. The area where the pilot vessel is located or where the Pilot has to be taken on board.
4. Any alternative area in the event of bad weather and when Pilot Boat not on usual station.
5. Details of any specific requirements on the part of Pilots with respect to boarding and safety
measures.
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 6. Location of anchorage for vessel awaiting a Pilot.

 Anchorage: Boundaries, areas and depths of safe anchorages.

 Restrictions: Details of any restrictions imposed upon entry, for example at night time, or in
accordance with state of tide and draft restriction.

 Max. Size: Maximum permissible length, breadth and draft for any vessel entering the port or for
oil carriers proceeding to installations outside the main port area, also state of tide governing
these dimensions.

 Health: Pratique procedure and action necessary to obtain Pratique. In addition, action necessary
in the event of any suspected disease or fever on board. Pratique may be automatic, for example,
vessels entering after calling on another port in the same country.

 Radio: Name and call sign of radio station through which it is best for a vessel to rout ETA cables
to agent, receivers etc. Availability of Email or FAX communication with vessels equipped with
Satellite services for E-Mails.

 VHF: Fullest possible data concerning VHF Radio communication facilities in operation at the port
including advices required from vessels approaching the port, arriving at the port, when
maneuvering within the port area, and when sailing. Details of standard communication
procedures and numbers of channels used in calling, further communication and safety, as may
be applicable with respect to Pilotage, Tugs, Port Authority, Quarantine or other craft or shore-
stations.

 Traffic Services: Details of existing Port Radar Service, also if the Master may contact the Radar
service by means of ship’s radio or by VHF, and the frequency or Channel number to be used.
Details of Vessel Traffic Management Service (VTS).

 Tugs: Number and capacity of tugs available. Minimum number of tugs required for berthing and
under berthing, position where tugs normally join the vessel. In addition, whether usual for ship’s
lines or tug’s lines to be used, and if optional, the usual charge for use of the tug’s lines.

 Berthing: Details of available berths, including length of quay, depth alongside, maximum
permissible ship-draft at low water (indicating whether salt or fresh water), whether load /
discharge is by shore equipment or by ship’s own gear, and other relevant date, together with
advice of cargoes handled at respective berths.

 Cranes: Fullest possible information concerning type, safe working loads and numbers of shore
cranes available at respective berths for cargo handling, Details of heavy lift cranes ashore or
afloat with lifting capacities. It is also helpful to know at which berths, within a port, that cranes
are not available and a vessel is required to use her own gear.

 Bulk Cargo Facilities: Details of berths and cargoes handled, length of quay, depth alongside,
maximum permissible draft (indicating salt or fresh) at low water, berth equipment, maximum
height of discharging gear above high water level, and maximum loading / discharge rates.
Cargoes intended to be covered by this heading are grain, ores, coal, fertilizers, sulphur, copra
etc.

 Specialised Cargo handling Facilities: Details of berths, specially equipped for handling
containers or Roll on / Roll off traffic, berths handling liquid chemicals of LPG carriers. It is also
useful to know if the port does not have any of these facilities.
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 Bridges: Details of any particular arrival time required in order passing through particulars bridges
and maximum air draft permissible under the bridge.

 Stevedores: Any particulars ETA advices required in order to arrange gangs. Details of main
commodities worked and average load or discharge rates. Normal working hours for general and
bulk cargoes, also hours that overtime is possible.

 Medical: Whether Agents need advance notice of required medical attention and the amount of
notice required. Hospital and dental facilities available and any other relevant medical
information such as a particulars inoculations required, vaccination / fever certificates etc and if
inoculations and vaccinations can be carried out.

 Tankers: Diameter of load / discharge lines in order that Master may now whether or not it is
necessary to fit reducing pieces before arrival; slop (residue) discharge facilities, capacities and
maximum receiving rate, SG API and temperatures of local types of oil (loading ports only).
Number of tankers berths, depth along side and maximum permitted drafts at these berths,
average load / discharge rates. Prevailing wind on berth. Special moorings required. Are shore
gangways available? Are facilities available to combat oil spills, if so, what equipment available?
Ship to ship transfer facilities.

 Density: (Salinity) Average salinity of water in the port. In Case of any seasonal variation same to
be known.

 Fresh Water: Availability, method of delivery, rate of delivery and approximate cost per ton.

 Fuel: Grades (viscosities) available, amount of advance notice required and method of delivery. If
bunkers supplied by vessel / barge, minimum / maximum quantity to be ordered and whether the
suppliers shall certify the fuel as required by rules.

 Fire Precautions: Any specific precautions particularly respecting tankers (that is, other than usual
non-smoking precautions etc.).

 Consuls: Names of countries having consuls at the Port.

 Repairs: Whether all types of deck and engine repair are possible, and if not then what types of
repairs can be carried out.

 Dry Docks: Dimensions of largest dry dock and the number of smaller docks.

 Surveyors: Availability of Cargo Inspectors who are reputable. Availability of Surveyors, such as
Lloyds Register, American Bureau, etc.

 Gangway/Deck Watchmen: Whether service of watchmen is necessary or to be recommended

and if so, the cost of watchmen.

 Hatches: Whether stevedores normally carry out opening / closing.

 Customs Allowances: (Tobacco/Wine/Spirits) Quantity permitted each crewmember to be held

out of Bond.

 Cargo Gear: Whether load/discharge effected by shore gear or by ship’s gear and details of any
special cargo equipment e.g. Heavy lift cranes, etc.
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 Repatriation: If facilities exist for effecting crew changes and arranging any necessary
repatriation.

 Airport: Distance from airport and whether airport is served by regular airlines; otherwise number
of flights per day or week and destinations.

 Time: Local time in relation to GMT and dates/details of any alternations made to clocks during
the year (summer time).

 Holidays: Dates and details of official and local holidays and advice whether or not cargo work
can be arranged on those days.

 EMERGENCY SERVICES Police / Ambulance / Fire: Telephone numbers of these services.

 Emergency Coordination Center: Nearest emergency coordination center and details of

telephone and telex numbers (e.g. Coast Guard). This information is necessary because local port
agents may not be suited to emergency matters and may not be contactable.

 Telephones: Whether arrangements exist for placing telephones on board and it so the
approximate cost for this connection. Nowadays this has become obsolete with the mobile /
Satellite phones becoming common for use.

 Services: Details of any special services available e.g. Tank cleaning equipment, facilities for
discharge of tank washings, compass adjusting, radio and radar repairs, supply of charts, nautical
publications, sounding paper, course recorder paper, availability of notice to Mariners,
availability of safety equipments, possibility of extension of certificates etc.

 Banks: Name, address, telephone, fax and telex numbers of any banks in the area.

 Storing: Can vessel be stored by barge or truck? Regulations concerning barge storing, such as
can vessel store from barges during loading or discharging? Can trucks proceed alongside at the
berth? If not, what is the approximate distance the truck to the ship? Can Forklifts be used on the
jetty to handle stores? Customs regulations in force regarding storing. Can local Riggers be
employed to assist with storing?

 Ship Supply Services: Name, address, telephone, fax & telex numbers etc. of ship supply service
operators who are able to supply craft or helicopters for transfer of stores, crew and sick
personnel. Also range, capacity and rendezvous points of supply craft and helicopters.

 Shore Leave: whether crew members are allowed ashore or not and formalities to be complied
with.

 Identification Cards: Whether shore passes issued or whether Seaman’s books are sufficient.

 Garbage Disposal: Whether collections service is available and if drums or skips are provided on
board or alongside, telephone numbers of garbage services, charges and collection time.

 Waste Oil Disposal: Whether collection service is available and capacity of shore tanks, barges
and tanker trucks, location of any special berth for this service. Name, address, telephone, fax,
telex numbers of companies operating this service, charges and any other relevant information.

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  Currency: Name of currency of the country and approximate exchange rate in relation to US
Dollar. Also if there are any currencies restrictions placed on seafarers.

 Seamen’s Clubs: Names of Seaman’s Clubs operating at the Port, facilities available and their
address and telephone numbers.

 Regulations: Any particular or unusual regulation for the Port.

 Delays: What delays in berthing, loading, discharging or bunkering can normally be expected.

 Developments: Details of expected draft increases, new installations, berths etc., expected in the
foreseeable future together with expected dates of completion.

 General: Any other information that may be of value to the Ship Master.

 Authority: Name, address, telephone, fax and telex numbers, and other details of the Port
Authority.

 Agent: The purpose of this item has been to provide Ship owners, Managers and Operators with
prompt access to the names, address and contact details of an experienced Ship Agent at the port
concerned.

 ISPS: Security level that the port / terminal is currently operating at.

6.1 Most of the above information is available in the GUIDE to PORT ENTRY, however its prudent for
important commercial related matters to be cross checked with the Port Agents prior arrival during every
port of call.

7.0 OFFICIAL LOG BOOK:

7.1 An official log shall be kept in the prescribed form in every Indian ship except a home-trade ship
of less than two hundred tons gross.

7.2 The official log may, at the discretion of the master or owner, be kept distinct from or united with
the ordinary ship’s log so that in all cases the spaces in the official log book be duly filled up.

7.3 Entries in official log books how and when to be made.

 Care must be taken whenever there is a change of master to see that documents handed over
are up-to-date.
 Entries must be made in order of date, and no blanks should be left.
 If any entry in the Official Log relates in any way to a member of the crew the page number is
to be entered against the man’s name in the Official Log and Index.

7.4 Following entries should be made in the Official Log Book:

 Every case in which the allowance of provisions is reduced, together with the quantity, or
quantities, of the article, or articles so reduced.
 Every case in which a member of the crew is promoted to a higher grade of service with the
date of such promotion, the grade and the rate of wages which the seaman is to receive.
 In cases of illness, frequent entries (daily if possible) showing the progress and treatment of
patient.

153
  Every case of drunkenness or misconduct on the part of any certificated Mate or Engineer,
whether the Master wishes the case to be investigated or not.
 Every important accident or damage to ship or cargo.
 every conviction by a legal tribunal of a member of his crew and the punishment inflicted;
 every offence committed by a member of his crew for which it is intended to prosecute or to
enforce a forfeiture or exact a fine, together with such a statement concerning the reading
over of that entry and concerning the reply (if any) made to the charge as is by this Act
required;
 Every case of illness, hurt or injury happening to a member of his crew with the nature thereof
and the medical treatment adopted (if any);
 Every case of death happening on board and the cause thereof, together with such particulars
as may be prescribed;
 Every birth happening on board, with the sex of the infant, the names of the parents and such
other particulars as may be prescribed;
 Every marriage taking place on board with the names and ages of the parties;
 The name of every seaman or apprentice who ceases to be a member of the crew otherwise
than by death, with the place, time, manner and cause thereof;
 The wages due to any seaman or apprentice who dies during the voyage and the gross amount
of all deductions to be made therefrom;
 The money or other property taken over of any seaman or apprentice who dies during the
voyage;
 Any other matter which is to be or may be prescribed for entry in the official log.

7.5 Note:

(i) If the master of a ship or any person fails without reasonable cause to comply with the
provisions of the above sections, he shall be liable to a fine to the extent shown below, vide S
436(2) of the Merchant Shipping Act, 1958:-

(a) S.214(2) – Fine which may extend to one-hundred rupees.

(b) S. 215(1) – Fine which may extend to fifty rupees, if no other penalty is provided in
the Act.
(c) S. 215(2) – Fine which may extend to three-hundred rupees.
(d) S. 216 – Fine which may extend to two-hundred rupees.
(e) S. 217 – Fine which may extend to one-hundred rupees.

(ii) If any person willfully destroys or mutilates or renders illegible any entry in any official log
book or willfully makes or procures to be made or assists in making a false or fraudulent entry in
or omissions from an official log book, he shall be liable to imprisonment which may extend to
one year.

(Source: Guide to Port Entry (2 Volumes) 1999 – 2000. Published by Shipping Guides Ltd., Shipping
Guide House, 75, Bell Street, Reigate, Surrey, RH2 7AN, England).

ooooooo

154
 SELF EXAMINATION QUESTIONS

RECOMMENDED BOOKS FOR READING:

*********************

155
SHIPPING PRACTICE FIRST YEAR

LESSON 14

BUSINESS COMMUNICATION IN SHIPPING

1.0 INTRODUCTION:

1.1 Communication is the process by which information is transmitted between individuals and/or
organizations, so that an understanding response results. It is an exchange of facts, ideas, opinions or
emotions by two or more persons ensured by feedback for the purpose of eliciting actions, which will
accomplish organizational goals.

2.0 HOW COMMUNICATIONS WORKS:

2.1 The first component of the process of communication is the idea or impulse which arrives in the
mind of the sender. The second component is the formal expression of the idea or impulse (encoding).
The third component is the interpretation of the message by the receiver (de-coding). The fourth
component is the reaction or response of the receiver to the message. If it is conveyed to the sender it is
known as feedback. The sender's interpretation or decoding of the feedback is the next component and
this completes one round of the communication cycle.

The first round of the communication cycle is only preliminary to many other rounds, each round adding
something to what the sender and the receiver previously knew.

3.0 BUSINESS COMMUNICATION:

3.1 The office is the hub of an organization's communication network whether the facilities are the
most basic or the most up-to-date imaginable. Communication is both internal within the organization
itself and external including worldwide contacts.

3.2 Business communication is concerned with transmitting and receiving information in all forms
involving buying and selling of goods and services with the intention of making a profit.

3.3 Managers spend a lot of time in communicating with others. Good communication is, therefore,
an essential key to success and management effectiveness.

3.4 A wide range of communication media is now available and you need to be familiar with the
possibilities which exist.

4.0 In this lesson we are discussing the following:

(a) Letter-writing (b) Telex

(c) Telephone (d) Fax
(e) E-mail (f) Report-writing
(g) Memo-writing (h) Charts and graphs

5.0 We have also included at the end of the lesson specimen of daily market reports -- enquiries for
time charter, time charter trip and voyage charter, etc., to give you an idea of what type of messages are
transmitted by telex, fax or e-mail with the necessary explanations wherever possible. These are only for
your information and not for detailed study.

156
6.0 LETTER-WRITING:

6.1 Purpose of a business letter is to:

(a) Establish communication between two persons who have not personal contact.
(b) Maintain a record of facts of business transactions.

6.2 A successful business letter should be clear and to the point. Certain guidelines have to be kept in
mind whilst writing a business letter:

(i) The writer must know what he wants to say.

(ii)He must be clear about the order in which he plans to say it.
(iii)
The letter has to be simple, the message obvious and the tone appropriate.
(iv)The letter should be divided into paragraphs each dealing with different point. Ambiguity
must be avoided at all costs.
(v) Spelling errors and mistakes in punctuation and grammar mistakes should be avoided.

6.3 Different firms choose different lay-outs. Here is an example of a fully-blocked style of lay-out.

(Note: All names, addresses, dates, telephone and other numbers in the letters that follow are fictitious
and any similarities should be ignored).

157
 IMPEX (INDIA) LTD
37,Pherozshah Mehta Road,Fort, Mumbai - 400 001.
Tel: 91-22-2611819/2637456
Fax : 91-22-2639154
Telex : 11-88255 IMPX IN

Our Ref:IM/SR/21 15 March, 1994

Your Ref.RK/100394

Mr. K. Swamy Narayan,

General Manager (Commercial),
R.K. Clearing & Forwarding Agents (P) Ltd.,
13, Pherozshah Mehta Road,
Mumbai - 400 001.

Dear Sir,

Sub: APPOINTMENT OF A CLEARING & FORWARDING AGENT

I have been asked by our Managing Director, Mr. S. Rao, to thank you for your letter of 10th March,1998,
suggesting that he would like to meet you to discuss the proposed appointment of a clearing and
forwarding agent to our firm.

Mr. Rao agrees an early meeting would be helpful and suggests a date during the week beginning
following Monday. He looks forward to meeting you.

Thank you,
Yours faithfully,
For IMPEX (INDIA) LTD.,

Sheila Nair,
Private Secretary to the Managing Director.

In the above letter the lay-out is as follows:

A
B C
D
E
F
G
H
I
J
K

158
Key to the lay-out

A = Company letter heading.

B = References.
C = Date.
D = Name, designation and address of the firm to whom the letter is being written.
E = Salutation, example, "Dear Sir, Dear Madam or Dear Sirs".
F = Subject of the letter (short description of the subject matter).
G = Body if the letter is in two, three or more paragraphs.
H = Subscription, usually "Yours faithfully", sometimes "Yours sincerely".
I = Name of the company represented by the writer.
J = Writer's name with his position in the company.
K = Enclosures (if any).

The opening lines are important because they set the tone for what follows. Similarly the ending of the
letter should also give the reader a pleasant impression. The body of the letter is the most important part
because it contains the message.

Specimen Letter after the Meeting with a Client

R.K. CLEARING & FORWARDING AGENTS PVT. LTD.

13,Pherozshah Mehta Road,
Mumbai - 400 001.
Tel:91-22-2638110- 3 lines
Fax : 91-22-2639092
Telex : 11-88510 RKCF IN

Our Ref: RK/030494 3 April, 1994

Mr. S. Rao,
Managing Director,
Impex (India) Ltd.,
37, Pherozshah Mehta Road,
Fort, Mumbai - 400 001.

Dear Sir,

Sub: APPOINTMENT OF A CLEARING & FORWARDING AGENT

We refer to the personal discussions you had with the undersigned on 31st March, 1994, on various
aspects of your import shipments.

We would like to introduce ourselves as one of the reputed shipping and forwarding agents for lines such
as American President Lines and Nedlloyd Lines. We are engaged in transportation, customs clearance,
forwarding, warehousing, sea-freight, sea-air shipments, IATA, etc., and have skilled manpower, expertise
and an all-India network.

We shall indeed be happy to handle your import shipments. We offer competitive all-inclusive agency
charges which are attached in the brochure sent along with this letter.

159
We hope you will find the offer quite competitive and look forward to a favourable response.

Thank you and we assure you of your best services and co-operation at all times.

Yours faithfully,
For R.K. Clearing & Forwarding Agents Pvt. Ltd.,

K. Swamy Narayan,
(General Manager, Commercial).

Specimen Letter of Complaint Concerning Late Delivery of a Container and Reply

IMPEX (INDIA) LTD

37, Pherozshah Mehta Road, Fort, Mumbai 400 001.
Tel : 91-92-2611819/2637456
Fax : 91-22-2639154
Telex : 11-88255 IMPX IN

Our Ref:IM/SL/85 20 May, 1994

R.K. Clearing & Forwarding Agents (P) Ltd.,

13, Pherozshah Mehta Road,
Mumbai 400 001.
(Kind Attention of Mr. Raghu)
Dear Sir,

Sub: Delay of Delivery

With reference to my telephone call of yesterday, I am sorry to inform you that the Container carrying
electronic typewriters and air-conditioners has not yet been received by us so far inspite of assurances
given by you.

As the goods are urgently needed, we would be glad if you could kindly arrange for their delivery without
any further delay.

A dozen of these typewriters and six air-conditioners have been promised to an important departmental
store in Pune for their annual sales commencing on 5th June.

Will you please let us know when we can expect delivery of the container?

Yours sincerely,

Sham Lal,
Sales Manager, Impex (India) Ltd.

160
 REPLY

R.K. CLEARING & FORWADING AGENTS PVT.LTD.

13, Pherozshah Mehta Road,
Mumbai 400 001.
Tel: 91-22-2638110 - 3 lines
Fax : 91-22-2639092
Telex : 11-88510 RKCF IN

Our Ref: RK/210594 21 May, 1994

Your Ref: IM/SL/85

Mr. Sham Lal,

Sales Manager,
Impex (India) Ltd.,
37, Pherozshah Mehta Road,
Mumbai 400 001.

Dear Mr.Sham Lal,

Thank you for your letter IM/SL/85 of 20th May. We very much regret that we have been unable to
complete delivery of your goods.

The delay has been due to a sudden strike at the port but we are happy to inform you that this has been
now settled.

We are working through the formalities of Customs Clearance and will deliver the container within next
five days.

We apologise for the inconvenience caused to you due to this delay.

Yours faithfully,
For R.K. CLEARING & FORWARDING AGENTS PVT. LTD.,

G. Sharma,
Supervisor.

161
 Specimen Letter of Application for a Job in a Shipping Company

19, Sangita,
105, Walkeshwar Road,
Mumbai - 400 006.

24th December, 1997

The Advertiser,
Box No.393C,
Times of India,
Mumbai - 400 001.

Dear Sir/Madam,

I wish to apply for the post of a trainee in the marketing department of your Shipping Company, advertised
in today's issue of the "Times of India".

I am 21 years of age and have passed B.Com. from University of Mumbai from H.R. College of Commerce
in April 1997. On leaving the college, I obtained the post of a trainee in the marketing department of
Three Star Couriers, 25, Kalbadevi Road, Mumbai 400 002, where I am still continuing.

I am attending evening classes thrice a week at the Narottam Morarjee Institute of Shipping and will
appear for the First Year Diploma Examination in Shipping Management in March 1998. This indicates that
I am interested in shipping.

My bio-data, along with a passport-size photograph, is attached herewith.

My employers know of this application and are willing to answer enquiries made about me. Also the
Principal of H.R. College of Commerce & Economics has agreed to act as my reference.

Thanking you,
Yours faithfully,

J . K. LALWANI.

162
 Specimen Letter of Settlement of an Outstanding Amount

R.K. CLEARING & FORWARDING AGENTS PVT. LTD.

13, Pherozshah Mehta Road,
Mumbai 400 001.
Tel : 91-22-2638110 - 3 lines
Fax : 91-22-2639002
Telex ; 11-88510 RKCF IN

Our Ref: RK/120794 12TH July, 1994

The Chief Accountant,

Impex (India) Ltd.,
37, Pherozshah Mehta Road,
Fort, MUMBAI - 400 001.

Dear Sir,

SUB: SETTLEMENT OF AN OUTSTANDING AMOUNT

We executed your order for clearance of one container with promptness inspite of delay at the port which
was beyond our control. We have not yet received your payment for this consignment though we have
sent you our bill and reminder subsequently.

Could it be that you are dissatisfied with our services? We are eager to retain you as our regular client and
shall greatly appreciate in investigating any complaint you may have against us. Meanwhile please send
us your cheque for Rs.25,500/- within the next 7 days.

Thank you, while assuring you of our best services at all times,

Yours faithfully,
For R.K. Clearing & Forwarding Agents Pvt. Ltd.,

(K. Swamy Narayan),

(General Manager, Commercial).

163
 Specimen Letter for Damaged Cargo

TOOLS EQUIPMENT CORPORATION

22, Sonapur Road,
Bhandup,
Mumbai 400 078
Tel : 5645891
Fax : 5659112

25th August, 1996

R.K. Clearing & Forwarding Agents Pvt. Ltd.,

13, Pherozshah Mehta Road,
Mumbai 400 001.

Dear Sir,

Ref: B/L NO.106 dt. 13-7-1996, Cont. No.APLU-204597/2

Inv. No. CD-31785 dt. 6-7-1996
Vessel : M.V. REEMA, V- 06.

Sub: 73 Cartons of Screwdrivers in torn/damaged condition.

This is to inform you that we have found 73 cartons of screwdrivers in torn/damaged condition out of
1500 cartons despatched from Ipswich port. The goods have been surveyed and the total loss comes to
Rs.27,560/- approximately.

You are therefore requested to please register our claim and arrange to investigate the claim as soon as
possible.

Thanking you,

Yours faithfully,
For Tools Equipment Corporation,

A. Shivram,
(Senior Accounts Officer).

164
 REPLY

R.K. CLEARING & FORWARDING AGENTS PVT. LTD.

13, Pherozshah Mehta Road,
Mumbai 400 001
Tel : 91-22-2638110 - 3 lines
Fax : 91-22-2639092
Telex : 11-88510 RKCF IN

Our Ref: RK/280896/CL.A31 28th August, 1996

Tools Equipment Corporation,

22, Sonapur Road,
Bhandup,
Mumbai 400 078.

Attn: Mr. A. Shivram

Sub: 73 Cartons of Screwdrivers in torn/damaged condition

M..V. Reema, V-6, B/L NO.106 dt. 13-7-1996.
Cont.No.APLU 204597/2.

Receipt of the above referred letter is acknowledged. The following documents are necessary to assist us
in the investigation of your claim:

 a. Bill of Lading.  b. Supplier's Invoice

 c. Packing List  d. Customs Bill of Entry
 e. Subrogation Letter  f. Detailed Claim Statement
 g. Customs Exam Report  h. Port Trust Landing Certificate
 i. Underwriter's Ship Survey Report  j. Reconditioning/Repairs Invoice
 k. Salvage Invoice Receipt  l. Evidence of Insurance

Kindly submit the above documents to enable us to deal with your claim.

Should you need to communicate with us concerning this claim, please refer to our claim no. Cl. A31.

Assuring you of our co-operation.

We remain,

Yours truly,
For R.K. Clearing & Forwarding Agents Pvt. Ltd.

R. Sanghvi,
(Claims Officer).

165
 Specimen Letter to Shipowners for Acting as a Ship's Agent

TOTAL SHIPPING CO. PVT. LTD.

14, Goa Mansion, Goa Street,
Mumbai 400 001.
Tel : 91-22-2641983/2632511/12/13 # Cable "TOTALSHIP"
Fax : 91-22-202 75 21
Telex : 11-88110/83240 TOTL IN

Ref. No. TS/AG/120 21st January, 1997

The General Manager (Operations),

South East Asia Line,
28/30, Ving Fu Bldg.,
Hong Kong.

Dear Sir,

Attn: Mr. G. Lee

Thank you for your enquiry regarding the appointment of a ship/port agent.

We understand during our telephone conversation that you possess a fleet of twenty multi-purpose cargo
vessels varying from 6,000 dwt. to 15,000 dwt, but you have never traded in the Indian market.

We have been in the business of handling shipping agency for over 20 years. Our head office is in Mumbai
(Bombay) and we have branch offices in all the other major Indian ports, viz., Calcutta, Haldia, Paradip,
Visakhapatnam, Madras, Tuticorin, Cochin, New Mangalore, Marmugao, JNP and Kandla. We also have
administrative offices in New Delhi, Jaipur, Pune, Ahmedabad, Bangalore, Hyderabad and Coimbatore.

We represent the following Lines as their agents in India: Gulf Maritime (UK) Ltd., Far East Container Line,
Hong Kong, and Maritime International Line, Dubai. At least four of their vessels call every month at the
Indian ports.

We also have a full fledged clearing and forwarding division and a shipbroking house and have recently
obtained a Multimodal Transport Operator's Licence.

All our port and administrative offices are manned by well-experienced personnel. Realising the
importance of communications, our offices are well equipped with transport facilities, computers,
telephones, e-mail, faxes, telex machines and VHF radios. We have special arrangements for warehousing
facilities within Mumbai and JNP Ports and have our own warehouses outside the ports of Kandla,
Chennai, Cochin and Visakhapatnam.

You must appreciate that this first letter is of necessity a general introduction. We urge you, therefore,
that after you have read this letter to give us a clear idea about your needs so that we can concentrate on
a particular area even though we are always available to give you any additional service you require.

We take this opportunity to enclose herewith our company's brochure and our annual reports for the last
three years along with details of our charges, facilities, references and past achievements. Also a detailed
booklet giving useful information on all major ports of India is attached herewith.
166
We will be too happy to attend your vessels calling at the Indian ports, as your ships' Agent.

Thanking you and best regards,

Yours faithfully,
For Total Shipping Co. Pvt. Ltd.,

Capt. K. Singh,
(Deputy General Manager).

7.0 TELEX

INTRODUCTION

The telex service, short for "Telegraphic Exchange," has been around for a long time. It is the oldest form
of electronic mail. Telex enables any two subscribers to transmit written communication, via telegraph
lines, but leaves a print out and the services will operate whether or not the other machine is manned,
provided it is switched on and fitted with paper to receive the message.

Telex has undergone a series of improvements bringing it into better line with the electronic age. The
arrival of the electronic telex machine has seen a tremendous improvement from preparation via tape,
the big bonus being the edit facility which is unavailable with paper tape so necessitating a retype in the
event of a mistake in the message in the latter case. Also with an electronic system the preparation of
outgoing material is not interrupted by the arrival of incoming message as was the case with the older
system when the two processes could not operate simultaneously. Basically the electronic telex machines
are like word processors, attached directly to telex lines.

NOWADAYS SELDOM DO COMPANIES OR INDIVIDUALS

COMMUNICATE OVER TELEX.
7.3 Disadvantages of telex service:

(a) Telex lines may be of order frequently.

(b) Messages may get distorted (garbled).

(c) International messages may reach foreign country at night when no one is present in the office
to receive them (due to time difference).

(d) Connections are not easily available when required.

167
7.4 Inspite of these disadvantages, today more than fifty per cent of business communications are in
telex form. Reasons for this are:

(a) A telex is quicker and more reliable as compared to other forms of communications.

(b) Distance has no relevance. Several telex messages can be exchanged in a day.

(c) A telex message is more likely to receive attention.

(d) A telex message is less formal than a business letter and no retyping and corrections are
necessary.

(e) It is less time consuming and cheaper than a fax/telephone call. There is less chance of
misinterpretation.

7.5 COMPONENTS OF A TELEX

1. REFERENCE
2. ACKNOWLEDGEMENT
3. INITIAL MESSAGE
Supplying Information
or
Requesting Information
or
Placing or Confirming order
or
Confirming a telephone conversation etc.

4. CONCLUSION
Assurance of service, etc.

5. SIGNING OFF

7.6 FORMAT OF A TELEX

GA 23221050  GA indicates "go ahead"

221010 GRA UR  Receiver's Telex No. and answer back

1178241  Sender's telex no. and answer back

08.03.95 21.39  Date and time

ATTN CAPT OSBORNE

GRAHAM CORP NEW YORK  Receiver

FM CAPT DILIP  Sender

PENINSULAR BBY

168
 PRABHU JIVESH  Reference (Name of vessel)
PLS SEND US CHRTS FULL 
BACKGROUND N ADVS WHT   Communication function
TYPE CGO/DURTN WE SHAL 
TRY OWS TO DO BIT CLOSR 
TO USD 12500 AWT YRS 
BRGDS  Closing

1178241 PENN IN  Sender's answer back and telex number

221010 GRA UR  Receiver's telex number and answer back

(Above two coded indications will automatically appear

at the end of transmission).

The name of the sender and the sender's firm may appear at the beginning of a telex or follow the closing.
It is not necessary in both places. Informal closing expressions such as kind regards or best regards are
commonly used in telex.

NOTES

Codes given below indicate problems or irregularities that might occur whilst transmitting a telex.
Examples,

CI = Communication impossible DER = Out of order

EEE = Error MOM = Wait a moment
NCH = Number changed OCC = Occupied

When abbreviating dates, in British English, and this is what we follow in India, the day precedes the
month, example, 5/3/1997 = 5th March 1997. In American English, the month precedes the day, example
5/3/1997 = May 3rd 1997. Be careful with interpretation of dates.

Abbreviations are used extensively in telexes to cut down the costs. However, there are no hard and fast
rules on how to abbreviate. You can only guess the meaning by the context. Each writer will have his own
of abbreviating words. Take the example in the format above.

PLS = Please CHRTS = Charterers

N = And ADVS = Advise
WHT = What CGO = Cargo
DURTN = Duration SHAL = Shall
OWS = owners CLOSR = Closer
AWT = Awaiting YRS = Yours
BRGDS = Best Regards

Word omissions are common in the majority of telexes. However, there must be no ambiguity. Whenever
in doubt, do not omit. The most frequent word omissions are : Definite or indefinite articles, pronouns,
prepositions, etc. Examples: The, a (articles); I, we (pronouns); in, on, at (Prepositions).

169
A reference line is one of the most important elements in a telex message. The receiver can know at a
glance the subject matter of the telex message plus the acknowledgement of any previous
correspondences, if any. Here is an example of the way in which a reference can shorten and simplify text:

"WITH REFERENCE TO YOUR RESERVATION FOR A DOUBLE ROOM IN THE NAME OF GOVIND SINGH FOR
THE NIGHTS OF FEBRUARY 2ND TO 5TH …" is reduced to "RE: DOUBLE RESERVATION G.SINGH - FEB 2-5".

Using appropriate expressions can save both time and space in composing telexes. Examples,

PLS NOTE = Please make a note of…….

WE SUGGEST = We put forward for consideration……..
PLS FWD = Please forward (send)………

In a telex message wording must be brief. Prefer short words for long and avoid superfluous words.

A telex message is garbled if it is incomprehensible due to faulty transmission.

Abbreviations commonly used in standard telex messages:

(See examples of telex messages sent by brokers at the end of this lesson)

ADD = Addition ADV = Advise

ARR = Arrange, arrive, arrival APPROX = approximate/approximately
ASAP = As soon as possible ATT/ATTN = Attention
BFORE = Before CONF = Confirm
DELY = Delivery, delay DESP = Despatch
DOCS = Documents FLWG/FOL = Following
FWD = Forward INFO = Information
MAX = Maximum MIN = Minimum
POSS = Possible QTY = Quantity
RE/REF = Reference REC/RECD = Received
REGDS = Regards RPLY = Reply
REQ = Require, request RPT = Repeat
SUBJ = Subject TKS = Thanks
THRU = Through TLX = Telex
U = You UR = Your
URLET/YRLET = Your letter URTLX/YRTLX= Your telex
W/E = Week ending WK = Week
WLD = Would YR = Your
YRS = Yours

In India, a telex subscriber can make inland telex calls to about 400 cities in the country. He can also dial
international telex numbers to about 238 countries, details of which are available in the All India Telex
Directory.

170
8.0 THE TELEPHONE :
8.1 The most convenient method of external communication is the telephone. This has the advantage
that it provides immediate contact, and because it is verbal it provides for easy formal and informal
discussion between the parties concerned. Queries and uncertainties can be clarified straightaway, and
action taken without delay.

8.2 The telephone, however, does have the grave risk of error and it can also lead to considerable
expense. It does not provide a permanent record for legal purposes. The receiver of a telephone message
has only one chance to receive and study the message. He cannot go over it at leisure as he can do in the
case of a letter or telex.

8.3 The telephone, therefore, is a means of communication that requires a great deal of thought.

9.0 FACSIMILE TRANSMISSION (ALSO CALLED FAX):

9.1 There are now more fax users worldwide than of telex. Fax is a system whereby it is possible to
transmit an exact copy (a fascimile) of a document, drawing, graph or any other material which can be
normally photocopied, over telephone lines, to be received by another fax machine somewhere else.
Distance is not hindrance. It only costs more in that charges accrue according to the destination and the
time it takes to send the message.

9.2 When a document is fed into the transmitting fax machine it is scanned and the information which
is enclosed into a series of electrical pulses is then sent down the normal telephone lines. At the other
end the message is reconstructed by a printer to produce the original message.

9.3 One big advantage of fax over many other communicating equipment is that two machines need
not be of the same make.

9.4 Most machines can only handle A4 materials, but some of the newer machines offer reduction
facility while others will transmit B4 documents size for size.

9.5 Although thermal printing using heat sensitive paper is still the dominant technique, plain paper
is beginning to catch on. The great disadvantage of thermal paper is its poor quality. It is also expensive
and tends to fade away with time.

9.6 The images produced via a fax machine are never quite up to the standard of those produced by
a photocopier. Another aspect which contributes to quality is the ability of the scanner to distinguish
between black and white. Shades of grey can be a problem and require the machine to be set accordingly.

9.7 It is still the quality of the telephone line at the end of transmission which affects the ultimate
copy most significantly. Line transmission can distort the image or lose part of it altogether making
messages difficult if not impossible to read.

9.8 New and imported machines are coming in the market all the time and in future there will be
more plain-paper machines, as well as more laser faxes. Also more fax and computer link-ups will exist
whereby messages compiled can be prepared on a computer and then sent via fax networking to another
fax subscriber who is able to view it on his VDU without printing out a hard copy first.
(See examples of fax messages sent by brokers at the end of this lesson).

FACSIMILE (FAX) MODE OF TRANSMISSION IS NOW REPLACED BY SCANNING DOCUMENTS

AND SENDING ACROSS THROUGH EMAIL AS ATTACHMENTS. HOWEVER STILL THERE ARE
AREAS WHERE FAX ARE BEING USED.
171
10.0 ELECTRONIC MAIL (E-MAIL):
10.1 Electronic mail, or e-mail, is an increasingly popular reason for installing a computer network.
With e-mail you can easily send a message to another user on the network or on other networks, including
the Internet (once your network is connected to other networks, of course).

10.2 Originally e-mail was text-based -- it contained only text characters. Now e-mail systems can
transfer video, audio and graphics, as well. Sending this data with e-mail halfway round the world is
usually much easier than by any other method. E-mail is faster than traditional regular postal mail
delivery, cheaper than courier services or fax and much simpler than dialing the recipient's computer and
transferring the files to it.

10.3 E-mail is one of the greatest advantages to users of networks. Rather than exchanging numerous
directives on paper, incurring printing costs and delays, network users can easily send messages to others
and even check to find out whether their message has been received. You can attach electronic
documents to mail messages, instantly duplicate and forward mail and perform many more tasks that are
cumbersome or impossible with paper messaging system.

10.4 Users can compose e-mail messages and send them to the mail box (also called the message box)
of anyone with an e-mail account on the network by including that user's e-mail address in the address
line of the e-mail message. Because e-mail is transferred electronically between e-mail users (post
offices), it is almost instantaneous. As with regular postal mail, users must periodically check their mail
boxes. Multiple addressee can be included in E-mails and across continents without any duplication.
Keeping the main addressee in TO and rest all concerned in CC the single typed message can be sent to
multiple companies/persons thereby saving tremendous time and money.

10.45 E-Mail in current scenario has replaced the TELEX and Fax to a maximum extent. Letters have
actually become obsolete with the exception of any legal notices where acknowledgement of delivery is
required.

10.5 GN COMTEXT: GN Comtext International Messaging Services are popular in the shipping industry.
GN Comtext, a 20--year old communication network, offers reliable value added messaging services to
over 80 countries worldwide. Value added messaging services include Comtext e-mail transmission to e-
mail, fax and telex to mainland and offshore destinations on ships via global GN Comtext-INMARSAT
gateway.

10.5.1 GN Comtext messaging ensures that messages are delivered immediately irrespective of the
destination anywhere around the world. The nerve centre of this data network is located in London.

10.6 The advantage of using Comtext is the flexibility and speed. The disadvantage is that if used for
local or national messages we still end up paying for an IAD call. Hence context is used generally for
international or out to sea messages.

10.7 For local use, local e-mail service providers such as Access and ICNET can be used with local hubs.

11.0 REPORT-WRITING :
11.1 A report is required to be given an account of the matter covered or to state an opinion on it.
Sometimes both are required. In most cases, conclusions have to be drawn by the compiler of the report
and often recommendations are given.

172
11.2 There are two main types of reports. The first one is the individual report. This is usually
expressed in first person and is the method used for internal routine reports and short reports on day-to-
day matters. The second type is the general report. This is more formal and is generally written in the
third person, though this is not always the case. Such reports are frequently composed for external or
public circulation and are often voluminous.

11.3 In normal course, the report should have a title and should be addressed to a person or group of
persons who are intended to study it. If a report is for general public distribution, this is not considered
necessary. If the report is addressed to a person or group of persons it should begin with a salutation,
e.g. "Dear Sir" or "Gentlemen".

11.4 A statement of the term of reference under which the report has been prepared is important and
this should be set out in the beginning of the report. In case of regular routine reports such terms need
not be stated. Some sort of introduction is useful to present the problem dealt with.

11.5 The body of the report should contain --

(i) The nature of investigations carried out.

(ii) A statement of the facts discussed.
(iii) Opinions arising from the investigations and facts uncovered by them.

11.6 The conclusion of the author (or authors) is normally called for. Frequently the recommendations
of the writer are required to be stated.

11.7 Invariably it is necessary to include in a report various charts, statistics, graphs and other
supporting material.

11.8 All reports should be normally signed by the author and should be dated.

12.0 THE MEMORANDUM:

12.1 The memorandum or memo is a very useful method of internal communication. The accuracy of
the written word helps to avoid errors that may occur with verbal methods. Secondly, where a copy is
taken by the sender, this serves as a record of the transmission as well as a ready reference for later use.

12.2 Unfortunately, memoranda are often used, not for these two advantages, but rather as a defence
in case the sender is accused either of not sending the message at all or sending a different message.

12.3 Most organizations have their own printed forms for this purpose. These can have different
designs but are likely to include the following information:

(a) Company/Organization's name.

(a) Memorandum heading
(b) To and from
(c) Date and sometimes reference
(d) Subject heading

12.4 Some organizations even adopt multiple copy memo packs which may be column coded for filing
purposes. Memos should always carry the initials of the sender. (It is not usual to sign them). There are
forms designed which incorporate a reply section on the same form which is useful in terms of record
keeping as well as saving time and taking up less storage space.

173
13.0 CHARTS & GRAPHS :

13.1 Information may be displayed on a more permanent basis or incorporated into some form of
written report. It is here that charts and graphs of one kind or another play a role.
In terms of charts and graphs the options are as follows:

(a) Line graphs -- may be single or multi-line.

(b) Bar charts -- may be single, compound or multiple bar and may be presented vertically
or horizontally.
(c) Histograms -- type of bar chart where the bars will not be of equal width, but permitted
to touch one another in graphic representations of frequency distributions.
(d) Gantt charts -- used to compare and contrast estimated figures or projections with
actual ones.
(e) Pie charts -- rely on pictorial or symbolic methods of representing statistics.
(f) Flow charts -- illustrate the progress and process by which a system or procedure is
followed through beginning to end.

13.2 In addition, diagrams, maps and models are other familiar ways of displaying information.

174
 EXAMPLES OF ORDERS/ENQUIRIES CIRCULATED BY THE
CHARTERERS' BROKERS ON TELEX, E-MAIL AND/OR FAX

TIME CHARTER (TC)

ACC HMM
ABT 23 / 25,000 DWT NONOA (MAX 18 YRS) MIN 20 T GR
DEL APS NCHINA L/CAN 3 / 10 JAN
TC FOR 3 / 5 MOS REDELY WW
TTL 3.75 PCT INCL 2.5 ADD

Explanation:

ACC HMM -- Name of charterer.

Require a vessel of deadweight 23/25000. NONOA = non-overage i.e. not exceeding 18 years of age
with a derrick/crane capacity of 20 metric tons.
Delivery arrival pilot station North China, on or between the 3rd and 10th of January.
Time charter is for 3 to 5 months. Redelivery world-wide.
Total commission 3.75 per cent including 2.5 percent address commission (to the charterers).

TIME CHARTER TRIP (TCT)

ACC SAMSUM
ABT 21 / 23,000 DWT MAX 20 YRS MIN 15 T GR
DEL APS BOMBAY L/CAN 15/20 SEPT
1 TCT WITH BULK SULPHUR DUR ABT 35 DAYS WOG.
REDEL SPORE/JPN RE
TTL 3.75 PCT INCL 2.5 ADCOM

Explanation:

Same as above except LINE 4: One Time Charter Trip with bulk Sulphur, duration about 35 days without
guarantee.
LINE 5 : Redelivery -- Singapore-Japan range of ports.

VOYAGE CHARTER (VC)

ACCT FCC
5,700 / 5 MT COAL
LOAD KUWAIT / DISCH HAZIRA (WC INDIA)
L/CAN 20 / 30 OCT
L/D 2500 / 1200 SHINC
TTL 6.25 PCT INCL 2.5 ADD

Explanation:

ACCT FCC = First class charterer (name not disclosed)

5,000/5 MT COAL = Cargo quantity i.e. 5,700 metric tons, 5 percent more or less (i.e.5415 mt or 5985 mt
coal)
LOAD KUWAIT DISCHARGE HAZIRA = Load port is Kuwait and discharge port is Hazira

175
L/CAN 20/30 OCT = The vessel to be available for loading on or between 20 th & 30th October L/D =
load/discharge rate, i.e., 2500 mt per day load, 1200 mt per day discharge,
SHINC = Sundays and holidays included
TTL = Total commission 6.25 percent including 2.5 percent address commission for charterers.

ACCT ANDRE
35,000 MT 5 PCT WHEAT
USG / UMQASAR
29 DEC / 5 JAN
5000 LOAD 3000 DISCH
5 PCT TTL INCL 3.75 ADDCOM

Explanation:
Same as above

EXAMPLE OF VESSEL CIRCULATED BY OWNERS' BROKER ON TELEX., E-MAIL AND / OR FAX

SHORT DESCRIPTION:
MV BLUE HIGH 43,415 / 90 4C 25 14 / 25 + 1.50 CHENNAI 8 / 10 DEC

Explanation:
Motor vessel Blue High 43,415 dwt, built in 1990, has 4 cranes of 25 metric tonnes capacity each. The
vessel's speed is 14 nautical miles per hour and it consumes 25 metric tons of intermediate fuel oil ( IFO)
plus 1.5 metric tons of marine diesel oil (MDO). MV Blue High is free in Chennai between 8th and 10th of
December.

LONG DESCRIPTION:

FLWG GEAR FITTED VSL:

MV JAG JIVAN -- ANTWERP 20-26 DEC

INDN SD ST BC 1987 -- AHL / ITF / SELF DISCHARGER

26,716 MT ON 10.467 M
LOA / BM 184.71 / 22.90
6HH HA SIZES: 12.8 x 12.8M MACG HACVRS
CRNS 5 X 25 MTS + 5 GRBS 4-63 CUM
G / B 33586 / 30899 CBM
13K ON 25 MT IFO 180CST + 1.5 MDO
INTD TRIP FE LOW USD 8,000

Explanation:
The following gear fitted Motor Vessel 'Jag Jivan' is free in Antwerp between December 20th and 26th.

Line 1 -- Indian nationality, single decker, self-trimming bulk carrier, 1987. Has Australian hold ladders, is
approved by the International Transport Workers' Federation and the vessel is a self-discharger.

Line 2 -- The vessel has a deadweight capacity of 26,716 metric tons on 10.467 mtrs draft.

176
Line 3 -- Length overall is 184.71 mtrs. Beam (width) is 22.90 mtrs.

Line 4 -- The vessel has 6 holds and 6 hatches. Hatch sizes are 12.8 x 12.8 mtrs. The hatches have
MacGregor patented hatch covers.

Line 5 -- The vessel has 5 cranes of 25 metric tons capacity plus 5 grabs of 4 - 6.3 cubic mtrs capacity.

Line 6 -- Grain / Bale capacity is 33586 / 30899 cubic mtrs respectively.

Line 7 -- Speed/consumption is 13 knots on 25 metric tons intermediate fuel oil, 180 centistokes (viscosity)
and 1.5 metric tons marine diesel oil.

Line 8 -- Owners are interested in a trip to the Far East at daily hire of USD 8000 to 8250 (low 8000s)

ooooo

SELF-EXAMINATION QUESTIONS

1. What is "Communication"? Why is it considered so important in business?

2. Your company is to appoint a customs house agent to handle its exports. Draft a
suitable letter listing out your requirements and the kind of services you expect
from the agent?
3. Your import consignment has incurred loss due to bad handling at the port and in
transit. Write a suitable letter to your C & F agent lodging a claim.
4. An associate from overseas has advised your company that a shipowner based
overseas is not happy with his present ship's agent in Mumbai and is looking for a
change. Your general manager has asked you to write a convincing letter to the
shipowner. How would you draft it?
5. Discuss utility of fax in business communication.
6. "E-mail has gained a lot of popularity nowadays and has replaced all other forms of
communication." Elaborate this statement.
7. Write short notes on:
(a) Memo-writing
(b) Types of charts and graphs
(c) Role of telephone in business

****************

177
SHIPPING PRACTICE FIRST YEAR

LESSON 15

ABBREVIATIONS

1.0 The following abbreviations are expanded in the Text Book SHIPPING PRACTICE by Stevens
& Butterfield, in Chapter 26, entitled “Definitions & Abbreviations,” pages 130-136. Hence they
are not repeated here:

A) a.a. A.& CP a.f. A/H A.M.

B) B.C. B.D. B.E. B.H. B/L

B.o.T B/S. b.t. B.V.

C) C.&F. C.&I. C.C. C.F.O. C.I.F.

C.I.F.C.I C.I.F.L.T. Cont. B/H. Cont. H/H. c.p.d.
C.T.L. c.t.l.o. cu.ft.

D) D.B.B. D.C. dd. Dp. D.w.c.c.

D.O.T (D of T)

E) E.C.C.P. E.C.U.K. ex.

F) F.&d. f.a. f.a.c. f.c.&s. f.d.

f.i.b. f.i.o. f.o.b. f.o.c. f.o.w.
f.o.d f.r.&c.c. frt. F.t.

G) G/A G.C.B.S.

I) I.M.C.O. i.v.

J) j&w.o.

L) L. C. L.E.F.O. L.M.C. L.L.T. LR.

L.R.M.C.

M) M/R.

N) n.a.a. n.d. N.M.B. n/n n.o.p.

n.r. n.r.a.d. n.r.a.d. n.r.a.s. n.t.

P) p/a P&I p.o.c. p.o.r.

R) r.d. r.d.c. r.o.b.

S) s.b.s. s.d. S/H.E. SHEX SHINC

SITPRO SOLAS s.p.d. std.

T) T.&P. T&S. T.l. T.l.o. T/O

t.p.i. T.T. T.W.H.D.

U) U.K.F.O. U.S.N.H.

W) w.p. w.w.d.
Y) Y.A.R.

178
2.0 Abbreviations are very important in Shipping and students are advised to memorize these
over a span of time. Constant revision is required at regular intervals as there is a tendency to
forget them. The information is useful not only for this year but also for the final year and
thereafter even at the work-place.

2.1 Students are advised to maintain a not ebook wherein they can copy down the
abbreviations and start entering new ones in the course of their two year study. Whenever the
abbreviations need explanation the same should be sought for, otherwise abbreviations by
themselves or in their expanded forms have little meaning. In the next lesson of your
Correspondence Course you will find a list of “Shipping Terms” which will give you the explanations
of some of the abbreviations listed herein.

2.2 We have tried to exclude, as far as possible, insurance, chartering and other abbreviations
as these will be covered up in the final year. Hence the list is not exhaustive. Another point worth
bearing in mind is that at times an abbreviation may have two full forms, both used in shipping,
but only one of them is mentioned here. You can note the other expanded full form in your personal
notebook which you have been advised to maintain.

2.3 At times an abbreviation is written in small letters, e.g., “dwt”; at other times in capital
letters, e.g., “DWT”. Don’t let this confuse you. An abbreviation may have full stops, e.g., “Y.A.R.”
This could also be abbreviated to “YAR”.

AH After hatch
ASEAN Association of South East Asian Nations (Brunei, Indonesia,
Malaysia, the Philippines, Singapore and Thailand)
A.P. or A/P After perpendicular (of ship); after peak; all purposes
A.P.T. (a.p.t.) After peak tank
ATA Actual time of arrival
ATS All Time Saved
APS Arrival pilot station
AGW All going well
ASAP(asap) As soon as possible
ASBA Association of Shipbrokers & Agents
ATN Aids to navigation
AHL Australian hold ladders

BACAT Barge aboard catamaran

BS Broken stowage
BB (bb) Ballast bonus; bar bound; break bulk; below bridges; bulbous, bow, bareboat
BAF Bunkers adjustment factor (a bunkering surcharge fixed as a percentage of the
base rate)
BBB Before breaking bulk
BDI (bdi) Both days (dates) inclusive (or included)
Bends (B/E) Both ends
BHP (bhp) Brake horse power (oil engines)
BIMCO Baltic & International Maritime Council, Copenhagen
BORO Bulk, oil and roll-on roll off vessel
B.P. Between perpendiculars; boiling point
B/N Booking note
BIFFEX The Baltic International Freight Futures Exchange
BFI Baltic Freight Index
BOB Balance on board
179
B/L (Bs/L) Bill of lading (bills of lading)
BLST Ballast
BLK Bulk

CBT Clean ballast tanks

COW Crude oil washing
CBR Commodity box rate
CONCOR Container Corporation of India Ltd.
CFS Container Freight Station.
COGSA Carriage of Goods by Sea Act
CIF & E Cost, insurance, freight and exchange
CIM Int. Convention for Conveyance of Goods by Rail, operative in Europe
CKD Completely knocked down; cars knocked down (loaded in crates)
CMR International Convention for Conveyance of Goods by Road
C.O. Country of origin; cargo oil; case oil
COD Cash on delivery; country of destination; change of destination
COB Cargo on board; close of business (chart.)
CSD Closed shelter deck
CTO Combined transport Operator
CVO Certificate of value and origin (usually combined with export invoice)
Cwt. Hundred weight
CY Container yard
CQD Customary quick discharge
COA Contract of affreightment
CBFT (cu.ft) Cubic feet
CHOPT Charterer’s option
CONS Consumption; consecutive
CPP Clean petroleum products
COP Custom of the port; cargo oil pump
C/P Charterparty; custom of the port
C/N Credit note
CSC International Convention for Safe Containers
CLC Civil Liability Convention (for oil pollution)
CST (c/s) Centistokes (used to describe quality of fuel oils, 380 or 180 or 150 c/s)
CD Customary dispatch; chart datum
CHA Customs house agent
C Shinc (Sundays & holidays included)

Db (db) Double bottom; deals and battens (timber)

DBE Despatch payable both ends
D1/2D(d1/2 D) Despatch money payable at half demurrage rate
Der (DR) Derricks
d.f.(DF) Dead freight
Dft Draft
DHD Despatch half demurrage
DO(do) Diesel oil
DOP Dropping outward pilot
D.T. Deep tank
DW(dwt) Deadweight (tonnage)
Dwc (DWC) Deadweight capacity
DAP Days all purposes
DEL (DELY) Delivery
DESP Despatch
d.p.p. (DPP) Dirty petroleum products
180
DBT Double bottom tanks
DD Daily discharge, dry docking
DDP Delivered duty paid
DEQ Delivered ex-quay
DES Delivered ex-ship
DDU Delivered duty unpaid
dt Double bottom (tanks)
DIS Denmark International Ship Register
DK Deck
DEC Deratting exemption certificate
DRC Daily running cost
DNV (NV) Det Norske Veritas, a Classification Society
D.O. Delivery order
D/P Documents against payment

EC East Coast, European Communities

ECGB East Coast of Great Britain
ECNA East Coast of North America
ECUS East Coast of U.S.A
Esd Echo sounding device
ETA Expected (or estimated) time of arrival
ETD Expected time of departure
ETS Expected time of sailing
Est Estimated
ETR Expected to be ready; expected time of reaching
ETC Expected time of commencing/completion
EIU Even if used
ETF Expected time of finishing
Eb Empty ballast
EGM Export General Manifest
EU European Union
EDI Electronic Data Interchange
EPIRB Emergency position indicator radio beam
ECU European Currency Unit
EDP Electronic Data Processing
EFTA European Free Trade Association

F Fresh water load line mark; Fahreinheit; forward; forecastle

FBL FIATA Combined transport bill of lading
FAK Freight all kinds (containers)
F&D Freight and demurrage
FAS (f.a.) Free alongside; free arrival station
Fbd (FBD) Freeboard
FCL Full container load
f.d. (FD) Free discharge; free of dispatch; also free delivery
F.I.A.T.A. International Federation of Freight Forwarding Agents Associatio, based in Zurich
f.i.o.s. (FIOS) Free in and out and stowed
Fifo First in first out
FIOT (fiot) Free in and out and trimmed
FO For orders; free out terms; fuel oil
FOC Flags of convenience; free of conveyance; also, free of charge
FONASBA Federation of National Association of Shipbrokers and Agents
FOR (FOR) Free on rail

181
FOS Free on ship
F.P. In free pratique; flash point
F.P.T. Force peak tank
FW Fresh water
FWA Fresh water allowance
FEU Forty-foot equivalent unit
Fwd Forward
f.v. Fishing vessel
FHEX Friday and holidays excepted
FHINC Fridays & Holidays included
FIOSpT Free in and out and spout trimmed
FWAD Fresh water arrival draft
FLASH Feeder lighter aboard ship
FIOST Free in and out, stowed and trimmed
Fh Forehatch

G Grain capacity
GB Great Britain
GC Great Circle; general cargo
GL Germanischer Lloyd
GMT Greenwich Mean Time
GT Gross tons (tonnage)
GRT Gross register ton (tonnage)
GOP Gross operating profit
G/B(GR/BL) Grain/bale
G-H Rge Gibraltar-Hamburg range
GO Gas oil
GP General purpose
GRI General rate increase
GATT General Agreement on Tariffs and Trade (now replaced by World Trade
(Organization)
G-15 Group of 15 developing countries
G-7 Group of 7 leading industrial countries

Ha Hatchway (s); hatch

HA or D Le Havre, Antwerp or Dunkirk (ports)
H.H. (H/H) Ports between and inclusive of Le Havre and Hamburg range
H/H Half height of an ISO container; house-to-house
HFO Heavy fuel oil
HR Hellenic Register, a Greek classification society based in Piraeus; Hampton Roads
HSS Heavy grain, soyabeans and sorghum(cargo)
HSD High speed diesel
HW High water
HD Half dispatch
HWDW Heavy, handy deadweight
HO(Ho) Hold
HWM High water mark
HC Hatch cover, hold cleaning
HO/HA Holds/hatches
HBR Hamburg range
HMS Her Majesty’s Ship
HT Home trade
HWOST High water at ordinary spring tides (now MHWS- mean high water spring tide)
HRDS Hampton Roads
182
IACS International Association of Classification Societies
ICC International Chamber of Commerce
ICD Inland Clearance Depot; Inland Container Depot
ICS International Chamber of Shipping
ID Import duty
IFO Intermediate fuel oil
IMDG (IMDGC) International Maritime Dangerous Goods (Code)
IMO International Maritime Organisation
INMARSAT International Marine Satellite Organisation
IWL Institute Warranty Limits
ITF International Transport Worker’s Federation
IHP Indicated horse power
ISM International Safety Management Code
IOC Indian Oil Corporation
ILO International LabourOrganisation
IRS Indian Register of Shipping, Mumbai
ISO International Standards Organisation
IGM Import General Manifest
INSA Indian National Shipowners Association
ISI Indian Standards Institution
ICHCA International Cargo Handling Co-ordination Association
ILU Institute of London Underwriters
ITU International Telecommunications Union
ISA International Salvage Association
IDL International Date Line
IMB International Maritime Bureau

J.R. Yugoslavia Register of Shipping, a classification society

JIT Just-in-time (concept)

K, Knt, kts Knot(s), a nautical mile

KR Korean Register, a classification society
KDC Knocked down condition

L Liquid capacity; laden

Lay/can Laydays commencing/laydays cancelling
LASH Lighter aboard ship
LBP Length between perpendiculars
L/C Letter of credit; laydays commencing/laydays cancelling
LOI Letter of indemnity
LCL Less than full container load
LHAR London, Hull, Antwerp or Rotterdam
LL Loadine’s; laden legs
LNG Liquified natural gas
LOA Length overall (of ship’s hull)
LO/LO Load on/load off or lift on lift off vessels
LIFO Liner in, free out
LPG Liquid petroleum gas
LiFo Last in, first out; liner in, free out
LNG Liquified natural gas carrier
LO Lubricating oil (also lube O)
Lt V Light vessel
LW (lw) Low water
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LWOST Low water at ordinary spring tides (now MLW - mean low water)
L/D Loading/discharging
LS Lumber summer (timber loadline for summer zone)
LT Long ton
LTF Lumber tropical fresh (timber loadline)
LA Los Angeles
LWNA Lumber Winter North Atlantic Loadline
LDN London; laden
Ldt(LDT) Light displacement ton (or tonnage)
LST Landing Ship Tank
LSA Life saving appliances
LAT Lowest astronomical tide
LOF Lloyd’s Open Form (salvage)

MHWS Mean high water springs

M Metre; measure; measurement
MS Motor ship; machinery survey; motor spirit
MLLW Mean low lowwatet
MSA Merchant Shipping Act
MLWS Mean low water springs
MOLOO More or less owner’s option
MT Metric ton (tone); multimodal transport; mean time; main terms
MTY (mty, mt) Empty (container)
M/T (MT) Motor tanker
MV Motor vessel
MSC Manchester Ship Canal
MOLCO More or less charterer’s option
MHWN Mean high water neaps
MLWN Mean low water neaps
MB/T Motor blocks/turnings (cargo)
MDO Marine diesel oil
MOA Memorandum of agreement
Minmax Minimum or maximum (tonnage to be loaded)
MSV Multi-support vessel
MTO Multimodal Transport Operator
M.C. Machinery Certificate
M.O.H Medical officer of health
MMD Mercantile Marine Department
MARPOL International Convention for Prevention of Marine Pollution from ships/maritime
adventures, 1973
MoST Ministry of Surface Transport

N North
NA North Atlantic; North America
NAABSA Not always afloat but safety aground
NK/NKK Nippon KaijiKyokai, Japanese ship classification society
N.O.P. Net Operating Profit
NOR Notice of Readiness
NT Net tons (tonnage)
NRT (nrt) Net registered tonnage
NV Det Norske Veritas, Norwegian classification society
NVOC Non-vessel owning (operating) common carrier
NVOC Non-vessel owning carrier
NVO non-vessel owning (carrier)
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NR Northern range of ports
n.E not east of
n.N not north of
NYPE New York Produce Exchange Time Charterparty, 1946
NIS Norwegian International Ship Register, Oslo
NPK Nitro phosphatic compound (cargo)
NMPD Nautical miles per day
NHP Nominal horse power
N/N No marks, no numbers (on cargo packages)
NOPAC North Pacific (ports)
NSUI National Seafarers Union of India (equivalent to ITF)
NEW North West Europe

OPEC Organisation of Petroleum Exporting Countries

OAPEC Organisation of Arab Petroleum Exporting Countries
OBO Oil, bulk, ore carriers
O/O Open charter, ore earlier
OSD Open shelter deck vessel
OSP One safe port
OO Owner’s option
O/O Oil/ore carrier (or ore/oil carrier)
OSB One safe berth
OAL Overall length
OBQ Onboard quantity
OSV Offshore vessel
OECD Organisation for Economic Co-operation & Development, Paris
OPA U.s. Oil Pollution Act, 1990

P&I Protection & Indemnity Club (also PANDI)

PBF Poop, bridge and forecastle
PBH Partial bulkhead
PC Parr cargo, parcel cargo
PCC Pure car carrier
PKD Partially knocked down
P.G. (P/G) Persian Gulf (same as AG- Arabian Gulf)
Pfd Position fixing device
PRC People’s Republic of China
Ppt Prompt
PR Polish Register, a classification society
POB Pilot on board
PCTC Pure car and truck carrier
PP Prepaid; picked ports; posted price; parcel post
Pac Pacific ocean; Pacific coast ports
PD Port dues
POD Port of distress; place of delivery; proof of delivery
PHO Port Health Officer
PSI Pounds per square inch
PMT Per (metric) tonne
POL Petroleum, oil and lube
PHC Port handling charges
PCNT Panama Canal Net Tonnage
PSCT Port side container terminal

185
Qn Quotation
Qlty Quality

RI RegistroItalianoNavale, a classification society

RO/RO (Ro-Ro) Roll-on/roll-off vessel
RPM Revolutions (or rotations) per minute
RSD Raised shelter deck
R.T.h Radio-telephone (high frequency)
R.T.m Radio-telephone (medium frequency)
R.T.v Radio-telephone (very high frequency)
RDR (Rdr) Radar
Redel Redelivery
R/V (RV) Round Voyage
Rds Roads
Ref Refrigerating machinery
RMC Refrigeration machinery certificate
RSC Radio safety certificate
RTG Rubber tyre quandary crane
RTD Round trip distance

S Summer load line; south

SS Steamship; special survey
SA South America; South Africa; South Australia; Safe anchorage; Salvage
Association
SB Safe birth
S&P Sale and purchase (of ships)
SBM Single buoy mooring; soyabean meal (cargo)
SBT Segregated ballast tank
S/F(SOF) Statement of fact
Sd/k Shelter deck
SD Single deck; self-discharging
SDWT Summer deadweight ton
SG Specific gravity
SDBC Single deck bulk carrier
SV Sailing vessel
STBC Self-trimming bulk carrier
Stc Said to contain
SW Salt water
s/o Shipowner
SWL (swl) Safe working load (crane, derrick)
SWAD Salt water arrival draft
SP Safe port
SWDD Salt water departure draft
Subs Subjects (fixed on)
SKO Superior kerosene oil
SKD Semi knocked down
STCW Convention on Standards of Training, Certification and Watch keeping for
Seafarers, 1978 (revised in 1995)
SDR Special Drawing Rights
Sub sg. Submarine signal
SRC Cargo ships safety radiography certificate
SEC Cargo ship safety equipment certificate
SCC Safety construction certificate

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SHP Shaft horse power
SCNT Suez Canal Net tonnage

T.t Tropical loadline

THC Terminal handling charges
TDW Tons deadweight
TEU Twenty-foot equivalent unit
TF Tropical fresh water loadline mark
TOVALOP Tanker Owners Voluntary Agreement Concerning Liability for Oil Pollution
TPC Tonnes per centimeter (immersion)
T/S Timesheet; transhipment
T/C(TC) Time charter
TCT Time charter trip
TNGE Tonnage
TBA To be advised
TP Trans Pacific
TA Trans Atlantic
TPD Tonnes per day
TARV Trans Atlantic Round Voyage
TPRV Trans Pacific Round Voyage
TD/TDK Tweendeckers (vesse)
TPCM Tonnes per cubic metre

UK/Cont(B.H.) United Kingdom or Continent (Bordeaux-Hamburg range of ports)

UK/Cont(G.H.) United Kingdom or Continent (Gibraltar-Hamburg range of ports)
UK/Cont(H.H.) United Kingdom or Continent (Le Havre-Hamburg range of ports)
UKC UK or Continent
ULCC Ultra large crude carrier
USEC United States East Coast (also, USEA)
USWC United States West Coast (also, USWE)
USG United States Gulf (of Mexico)
UU Unless used
UNCTAD United Nations Conference on Trade & Development
UNCITRA United Nationals Conference on International Trade Law
USSH United States South of Cape Hatteras
U/D Under deck
UNECSO United Nations Education, Scientific and Cultural Organisation
Uw Underwater
UMS Unmanned machinery space
USNP United States North Pacific
UCP Uniform Customs and Practice of Documentary Credits

V/L (vsl) Vessel

VLCC Very large crude carrier
VLPC Very large products carrier
VLOO Very large ore/oilers
V/C Voyage charter
VTS Vessel traffic system
VTMS Vessel traffic management service

W Winterloadline mark
WS Worldscale
WIFPON Whether in free pratique or not
WC West Coast
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WCSA West Coast of South America (also Africa)
WCNA West Coast of North America
WCUK West Coast United Kingdom
WCUS West Coast of USA
WIBON Whether in berth or not
WIPON Whether in port or not
WCCON Whether customs cleared or not
WP Weather permitting
WOG Without guarantee
WW Weather working
WMO World Meteorological Organisation
Wob Washed overboard
WTO World Trade Organisation
WT Wing tanks
Wef With effect from
WL Waterline
WAG West Asia Gulf

X Shex, Sunday & Holidays excluded.

ooooo

SELF-EXAMINATION QUESTION

1. Expand the following abbreviations:

(a) WS (d) SCC (g) TARV (j) WAG
(b) TDW (e) INSA (h) INMARSAT (k) STCW
(c) TPCM (f) ICHCA (i) SCNT (l) WIPON

2. State the abbreviated forms of:

(i) International federation of Freight Forwarding Agents Association
(ii) Forty-foot container
(iii) In free pratique
(iv) Federation of National Association of Shipbrokers and Agents
(v) Twenty-foot container
(vi) Feeder lighter aboard ship
(vii) FIATA combined Transport Bill of Lading
(viii) International Transport Workers Federation

3. Give expanded forms of the following organizations:

(a) UNCITRAL (d) G.C.B.C. (g) MMD (j) EU
(b) MoST (e) SITPRO (h) TOVALOP (k) UNESCO
(c) OPEC (f) OECD (i) OAPEC (l) EFTA

4. Following are pertaining to range of ports. Please identify them.

(i) USNH (iii) Cont H/H (v) USG
(ii) ARA (iv) LHAR (vi) CH & H

5. Give the full forms of following classification societies

(a) IRS (c) LR (e) NV (g) KR
(b) BV (d) GL (f) PR (h) JR

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 6. These are International Conventions/Codes. Can you identify them?
(i) MARPOL (iii) CSC (v) CLC (vii) STCW
(ii) CMR (iv) CIM (vi) ISM (viii) CMR

7. The following abbreviations describe ships. How many of these do you know?
(a) VLCC (d) SD (g) BC (j) TD
(b) O/O (e) HMS (h) ULCC (k) FLASH
(c) BACAT (f) BORO (i) PCTC (l) B/O

8. Following short forms are from the key to the Lloyd’s Register of Ships. Give full forms.
(i) Rdr (iii) Esd (v) NS (vii) Df
(ii) RT (iv) LRMC (vi) d.o. (viii) LMC

9. Give full forms of:

(a) F.o.c (e) f.o.w. (i) C & I (m) f.a.c.
(b) L.E.F.O (f) D.B.B. (j) a.a. (n) c.p.d.
(c) YAR (g) T.l.o. (k) r.o.b. (o) w.b.
(d) SHINC (h) WTO (l) ECUK (p) n.o.p.

10. Give the opposites of:

(i) CHOPT (iv) SHEX (vii) C/N
(ii) ETA (v) c.b.r. (viii) FHINC
(iii) DDU (vi) F.P.T.

RECOMMENDED FRO REFERENCE ONLY:

1. Fairplay Book of Shipping Abbreviations – P. Kapoor, 1st Ed., 1980.

A specialist reference book dealing with abbreviations used in shipping and international
trades. Covers up shipping, shipbroking, marine insurance, export/import, container transport,
etc. Valuable even for final year students. Published by Fairplay Publications who are famous for
excellent books on shipping for students and practitioners.

2. Dictionary of International Trade Terms & Abbreviations – A. E. Branch, 2nd Ed., 1982.

An extensive but handy reference guide by a well-known authority on shipping. More emphasis
is given to terms on shipping/international trade than to abbreviations. Nevertheless a useful
volume.

3. Containerization & Multimodal Transport – Dr. K. V. Hariharan, 2nd Ed., 1997.

Abbreviations pertaining to containers and multimodal transport are covered under “Glossary of
Terms” (Pages 211-225).

******************************

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SHIPPING PRACTICE FIRST YEAR

LESSON 16

BASIC SHIPPING TERMINOLOGY

1.0 INTRODUCTION:

1.1 The following terms are explained in the text-book "Shipping Practice" by
Stevens & Butterfield, in Chapter 26, entitled "Definitions & Abbreviations", pages
130-136. Hence they are not repeated here, except in a few cases where further
explanations are required.

A: Always Afloat; Abandonment; Act of God; Ad Valorem; Ad Valorem Freight; Advance

Notices; Affreightment ; Arbitration; Arbitration Award.

B: Bailee; Barratry; Bill of Health; Bill of Lading; Bonded Goods; Bottomry; Brokerage;
Bunker.

C: Cargo; Caveat Emptor; Cesser Clause; Charter-Party; Clearance; Clear Days;

Complement; Consign; Consignor; Consignee; Consul; Consulage; Contraband.

D: Deadfreight; Deck Load; Del Credere; Demurrage; Deviation; Dirty Money; Drawback;
Dredage; Dock Dues; Draught; Dumb Barge; Dunnage.

E: Embargo; Excise; Ex Facie; Ex-Quay; Ex-Ships.

F: Flotsam; Founder; Form O; Franco.

G: Gross Tonnage; Groundage.

H: Hogged; Hold; Home Trade.

I: Indemnity; Inherent Vice; In Transit ; Inward Charges.

J: Jetsam; Jettison.

K: Knot.

L: Lagan; Landing Order; Lay Days; Lazaretto; Levant; Lien; Light Dues; Lightwage;
Loading Turn; London Clause; Lump Sum Freight.

M: Metric Ton.

N: Not Negotiable; Northern Range.

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O: Open Charter.

P: Poop; Portage Bill; Pratique; Prima Facie; Primage; Pro Forma; Pro Rata.

Q: Quoin.

R: Rebate.

S: Sabotage; Safe Port; Scuttle; Shipping Note; Spot; Std; Stevedore; Stripping;
Stuffing; Supercargo.

T: Tallying; Tare; Tariff; Transshipment.

U: Ullage.

V: Vice Propre.

2.0 This is a very important lesson and students should pay great attention and
try to understand most of the terms and memorize as many as they can. The
information will be useful not only for the First Year Examination but also for the
Final Year Examination. Of more utility will be the knowledge in the field of
practical shipping at the work place.

2.1 The list is not exhaustive. Besides, some terms have more than one
meaning. In fact students are advised to maintain a note book for "Shipping
Terms" and start entering new ones as they progress in their study. This exercise
can then continue during the Final Year and even if they are gainfully employed.
Immense benefit will accrue to them in the long run.

2.2 Though this is a Lesson in Shipping Practice we have tried to cover some
basic terms used in Geography and Law, all meant for the First Year Students.
Most of the entries are short and precise. In some cases only one meaning is
given, though there may be more than one definition or explanation. Please look
up the reference books at the end of the lesson, if required.

2.3 We have not given you the abbreviated forms of the terms in this lesson
since they are covered in another lesson. At the end of this lesson an unusually
long list of self-examination questions is given purposely to familiarize the
students with the basic shipping terms.

2.4 In the present lesson we have omitted most of the insurance, chartering,
advanced law, economics and financial terms as these are meant for the Final
Year Students.
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A : The highest class under which vessels are registered at Lloyd's.
Abaft: Behind or towards the stern of a vessel. "Abaft the funnel" means "behind the funnel".
Abeam: On the side of a vessel, amidships. Thus "wind abeam" or "wind on the beam " mean wind at right
angles to the vessel.

Aboard: On, or in, a vessel.

Above Board: Above deck.

Abreast: On the beam.

Accommodation Ladder: Steps from the gangway to the water with platforms at the top and bottom.

Accomplished Bill of Lading: Original bill of lading which has been surrendered to the carrying ship at the
discharge port in exchange for the goods.

Acid Tanker: A specialized ship designed to carry acids with tanks made out of stainless steel with a number of
safety features.

Actual Gross Weight: The weight of the product plus packing.

Actual Pay Load (Net Weight): The difference between the actual gross weight and the gross tare weight of a
container or tracker or the weight of goods unpacked.

Address Commission: Commission payable to the charterer by the shipowner as a percentage of freight or hire.

Admiralty: The system of jurisprudence relating to both civil and criminal maritime law. Admiralty courts have
jurisprudence over all matters relating to the sea.

Adrift: Anything which floats unfastened, e.g. a ship which has parted from her anchor.

Advice of Arrival (of Goods)/Advice Note: A notification from the owner to the consignee in writing or some
other means that his consignment has arrived (or will shortly be arriving) at a specified point in the place of
destination.

Aft: Behind, towards the after or stern part of the vessel, or it may be behind the vessel itself.

After-castle: Old word for poop, the aftermost structure on deck. No longer used.

After – Peak Tank: An enclosed space or tank under deck and farthest aft in a ship, sometimes used as fresh water
tank but more often as a water ballast tank for trimming the ship.

Agency Fee: It is the remuneration payable to agents for attending to the ship during her stay at their port.
Normally, the owner of a regular line also grants a certain percentage of freight to the agents on outward and
inward cargo as commission in addition to the regular agency fee.

Aground: Resting on the ground, e.g. vessel which has run accidentally aground.

Ahoy: When preceded by a vessel's name it is a customary way to hail a vessel. Now replaced by "Hello" or "Hi
there".

Air Draft: Three definitions:

(a) The max. height from the water-line to the top-most point of a ship. This information is required for ships
having to navigate bridges, or
(b) The max. height from the water-line to the top of hatch coamings. This information is required in trades
where loading is effected by conveyor belt which goes over the hatchway, or
(c) The clearance between the bridges to the topmost point of a ship.

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Air Way Bill: An air freight consignment note which is an evidence of a contract between carrier and the shipper
for carriage of goods by air.

Alaska Current: The north flowing branch of the Aleutian current carrying relatively warm water. It flows into the
Gulf of Alaska where it circulates counter-clockwise.

All Told: This means that the capacity of a vessel represents the total deadweight capacity including cargo,
bunkers, water, provisions, dunnage, stores and spare parts.

Alongside: By the side of.

Alternate Holds: Practice of loading iron ore cargoes into every alternate hold on a ship, leaving remaining holds
empty.

Amidships: Generally speaking, the middle portion of a ship.

Anchor & Chain Certificate: Issued by a classification society or government agency, stating anchors and chains
have passed required inspections and tests.

Anchor Lights: Lights displayed by a ship at anchor or moored.

Anchor Position: A term indicating the location of an anchored vessel.

Anchor: A device that is lowered to the bottom of the sea by means of a chain or rope and that holds the vessel in
place.

Anchorage: Ground on which anchor is cast. The term is also used to denote dues which are paid by vessels for
casting anchor in certain harbours.

Anemometer: An instrument for measuring the force or velocity of the wind.

Angle of Repose: The angle between a horizontal plane and the cone slope obtained when bulk cargo is emptied
on to this plane. The angle of repose indicates how a particular cargo will behave in a ship's hold at sea. A cargo
with a low angle of repose (less than 35 o) is liable to dry surface movements aboard a ship. For grain it is 25-35
degrees; while for coal it is 30-45 o.

Anti Cyclone: A high pressure weather mass around which the winds blow clock-wise in the Northern Hemisphere
(counter-clockwise in the Southern). Generally indicates fair weather.

Anti Fouling: A technique of applying a special type of hull coating or paint used to prevent marine organisations
from attaching themselves there.

Apparent Good Order and Condition: The description is applied in a Bill of Lading (B/L) to goods for which the
Chief Officer (first mate) has given a clean receipt. As packages, bales, cases cannot be opened for inspection of
contents, a receipt for their external condition only can be given. Hence the term "in apparent good order and
condition" is stated and this in fact constitutes a clean B/L.

Apron (of Wharf or Pier): The hard surfaced area on the quay where cargo is unloaded and/or assembled.

Arctic Current: Same as Labrador Current. An ocean current in the North Atlantic getting south out of Davis Strait
and flowing down the coast of Labrador and Newfoundland until it meets the Gulf Stream drift with which some
of it moves east and north. It is a cold current often bringing down ice that can endanger shipping.

Arrest: A ship may be detained because of some violation of regulations. She is arrested if a maritime lien is to be
served upon her.

Arrived Ship: A vessel is an “arrived ship” and the laydays allowed under a charter-party begin to count as soon as
the following conditions have been complied with
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 (a) The vessel must have arrived at the port, berth or dock, as stipulated in the C/P.
(b) The vessel must be ready to load or discharge in every respect.
(c) Proper notice of readiness must have been given in writing to the charterers shippers/consignees, as the
case may be.
Astern: Behind. In the after part of the vessel.

Athwartships: Across the ship, from side to side, e.g. cargo is stowed athwartships as opposed to lengthways.

Auxiliary Machinery: Machinery aboard ship other than the main propulsion, including generators, winches and
emergency pumps.

Average Bond: Bond in which cargo owners agree to pay as their share in the general average losses.

Average, Particular and General: These two terms are used with reference to damage or loss to ship and/or
cargo during a voyage. Particular average is applied to a loss due to an "Act of God" (accidents due to the force of
the elements beyond human power or other circumstances which could not possibly be foreseen or prevented).
The owners of the ship or cargo bear this loss, which is usually covered by insurance. General Average is applied to
a loss attributed to an "act of man". It results from a deliberate sacrifice made of part of the cargo, or the ship, in
order to save the whole adventure. When this is done, the other cargo owners and/or the shipowner are
required to contribute towards the loss of the part.

Back Freight : Freight charged for the return of goods which have not been accepted at port of delivery.

Baco Liner: An ocean going barge carrier with a capacity of 21000 dwt and may carry 500 TEUs plus twelve barges
below deck. The barges are transshipped from the mother vessel on arrival at the port area to be towed along the
various inland waterways, thereby providing a door to door service.

Baggage: Passenger luggage. Baggage vehicle -- A vehicle conveying accompanied or unaccompanied passenger
baggage.

Bags: Method of packing cargo consisting of plastic, cotton, paper or jute.

Bailment: The delivery of goods by one person (bailor) to another (bailee) for some purpose upon a contract that
they shall, when the purpose is accomplished, be returned or otherwise be disposed of according to the directions
of the person delivering them.

Bailor: The person who delivers the goods by way of bailment.

Bale Capacity: The usual cubic capacity of a ship's holds below decks available for the carriage of solid cargoes
e.g., bales, cartons, pallets, drums, etc. which are not capable of filling the spaces between the ship's frames,
expressed in cubic feet or cubic metres.

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 redelivery 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 may pay the
charterer a ballast bonus when the vessel is being re-delivered at the end of a time charter, specially when market
is not good for the shipowner.

Ballast Leg:

Ballast: Any material that provides stability to a ship. Weight deposited in ship's hold when she has no cargo or is
too light to bring her sufficiently low in the water. In modern vessels water ballast is used and is carried in double-
-bottom tanks, the water being pumped out as required.

Banker's Indemnity: A document required by the ship owner to be completed and signed by the consignee and
countersigned by the cosingnee's first class banker, whenever the release of goods is required without the
production of a bill of lading.

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Bill of Entry: A document submitted by an importer at the Customs House describing the nature, value, rate of
exchange and other information about the goods he imports and declaring the place from which they have been
imported.

Bill of Lading: The document under which cargo is carried on board a vessel. It has following functions: (a) It is a
receipt for goods, signed by the master or other duly authorized person on behalf of the shipowner. (b) It is a
document of a title to the goods described therein. (c) It serves as evidence of the terms and conditions of
carriage. (d) It is a quasi-negotiable instrument. It is the most important document in international trade.

Bunker/Bunkers: Ship's space for storing fuel (coal, oil, etc). Also, fuel itself.

Bunkering: A technique of fuelling a ship in such a manner that it can carry maximum cargo.

Buoyancy: The Principle of Archimedes states that the weight of any floating body is equal to the weight of the
fluid displaced by that body. The upward force acting on the body is known as the buoyancy and the point
through which the resultant upward force acts is known as the centre of buoyancy.

Bureau Veritas (BV): A classification society established in 1828, based in Paris. Its activities are similar to Lloyd's
Register of shipping for vessels' inspection.

Bar: A bank usually at the mouth of the river which obstructs navigation by reducing depth of water.

Bar Draft: This expression relates to the maximum draft enabling the ship 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
lighters and then re-load it after passing the bar. A similar situation exists at Rangoon (now Yangon). Such ports
are called "bar ports". Vessels which are prevented from crossing the bar through the draft exceeding the
maximum depth of water on the bar are "bar bound".

Berth Charter: If a vessel is chartered for loading "on the berth" the contract of affreightment is called "berth
charter". The term berth charter implies that notice of readiness cannot be given until the vessel is in a
designated berth as ordered by charterers.

Both Ends: The term implies that the arrangements agreed upon hold true both at loading and discharging ports,
e.g., rate of loading and discharging, appointment of agents, etc.

Breaking Bulk: The expression simply means -- "To start the discharge".

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

Blank Endorsement: An endorsement containing merely the signature of the endorser without mentioning the
name of the person in whose favour the endorsement is made.

Bond: A stamped and sealed undertaking to perform a certain act or to abide by a certain decision and to pay a
fine or penalty in case of default.

Bonded Warehouse: A warehouse for storage of goods liable to duty for the storage of which a to be been given
to Customs.

Bulk Cargoes: A cargo consisting of solids in particle or granular form, generally homogeneous, loaded directly
into a vessel's cargo spaces without bagging or packing, e.g., grain, coal, iron ore, etc.

Barge: A general name given to a flat-bottomed, sea-going, river or canal craft usually pushed or towed by a tug.

Barge Carrier: A ship specially designed to load, transport and unload cargo - filled barges, e.g., LASH, BACAT,
Seabee, Baco Liner.

Barometer: A well known instrument invented by Torrricelli for measuring the weight or pressure of the
atmosphere. A rapid fall in pressure indicates an increase in wind force.

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Basin: Any enclosed or sheltered dock which protects ships from tide and weather in which vessels flow at any
state of the tide.

Beam: The width of a vessel at her widest part. A wide vessel is said to have more beam.

Beaufort Scale: A scale of wind force expressed from 0 to 12 by which weather conditions may be expressed by
numerals, viz., 0 = calm, 3 = gentle breeze, 11 = storm, 12 = hurricane.

Between Decks or Tween Decks: In a vessel with more than one deck, compartments between the upper and the
lower decks.

Bilge: The lower part of the vessel upon which she rests when aground. The water that collects in the bottom of
a vessel is known as bilge water.

Bore: A word used to express the sudden rise of the tide in certain estuaries.

Bottom: That part of the ship which is under the water line. Sometimes also referred to an entire ship.

Bow (Bows): The sides at the fore-part of the vessel, distinguishing one from the other by the right and the left
hand, the first being the starboard and the second port bow.

Brackish: Spoken of water in a river with half salt and half fresh.

Breakwater: An artificial bank or wall set up either outside a harbour or along a coast to break the violence of the
sea and create a smooth shelter.

Bridge: Superstructure having a clear view forward and on either side from which a ship is navigated.

Bulwarks: A parapet round the deck of a vessel to protect persons or goods from being washed overboard.

Buoy: A floating object moored over a certain spot to mark a course for vessels or to which vessels may fasten
themselves.

Barge Above Catamaran: A Danish designed system for carrying barges or lighters aboard a twin-hulled vessel.

Baltic Exchange: The association of ships' brokers in London who arrange world-wide charters for tramp shipping,
representing either shipowners or charterers.

Barrel: A quantity measure, varying according to cargo or liquid, e.g., for petroleum -- 42 gallons at 60oF.

Bay: A wide indentation in the coast, smaller than a gulf and larger than a cove.

Bed: The bottom of the ocean, also called the seabed.

Benguela Current: A strong northerly ocean current off the coast of Africa. It is a continuation of the South
Atlantic Current and turns west to join the South Equatorial Current.

Black Current: Another name for the Kuroshio or Japan Current.

Boiler: A steel chamber used to generate steam for ship propulsion.

Bollards: Heavy steel short posts on a dock or pier for tying a ship's mooring lines.

Brazil Current: The portion of the westerly South Atlantic Equatorial Current that turns south along the coast of
Brazil.

Breadth: The width of a ship, same as beam.

Break Bulk: Describes loose bales, boxes, packages, but neither container loaded nor palletized. Describes a
cargo vessel that loads its cargo in this manner.
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Broken Stowage: The space wasted in a ship's hold when stowing general cargo.

Bulkhead: Any vertical portion or wall in a ship which could be water-tight and fire-proof.

Buoy: An anchored, unmanned, floating device to mark a channel or obstruction.

Ballast Bonus: Sum of money paid by a time charterer to a shipowner to compensate him for not finding a cargo
near the place of redelivery of the ship at the end of the charter.

Ballast Leg: Voyage of a vessel when the ship is not carrying a cargo.

Bareboat Charter: Hiring of a vessel for a period of time during which the shipowner provides only the ship while
the charterer provides the crew together with all stores and bunkers and pays all operating costs. Also referred to
as a Demise Charter.

Base Rate: Basic rate of freight of a shipping line or liner conference to which are added various surcharges.

Bitumen Carrier: Specialised tanker used for the carriage of bitumen in liquid form.

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.

Black Products: Crude oils such as heavy fuel oil; also referred to as dirty (petroleum) products.

Booking List: List of all cargo bookings for a particular sailing.

Boom: (i) Forklift -- Horizontal arm which replaces the forks of a forklift truck and is used to carry cargoes such
as coils of wire rod. (ii) Derrick - the arm of a derrick which projects outwards from the post and from which cargo
is suspended.

Bow Door: Door at the forward end of a ferry.

Bow Ramp: Ramp at the forward end of a roll-on roll-off ship. It is a watertight door when closed.

Bow Thruster: A small propeller near the stem which improves maneuverability of a ship at a low speed.

Box Rate: Freight rate per container unit as opposed to per tonne or per cubic metre rate.

Bulbous Bow: Rounded projection at the forward end of a ship which reduces water resistance and improves
speed when ship is in ballast.

Bunkering Port: Port at which a ship calls to take bunkers but not to load or discharge cargo.

Breaching: Voluntarily stranding of a vessel.

Bridge: Navigating centre of a ship.

Bulk Liquid Container: An ISO container designed for the shipment of bulk oil/chemicals/wine/spirits and similar
liquid cargoes.

Bleeding Wing Tank: Tank situated at each side of the top section of the holds of a bulk carrier designed to carry
free flowing cargoes such as grain, etc.

Block Stowage: Arranging the cargo in ship's holds in stacks of even length without any protrusion to maximise
use of space.

Box: 20' Shipping Container.

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Bucket Elevator: Moving belt which brings continuous supply of buckets loaded with bulk commodities from
ashore and empties them into the hold of the ship.

Cargo Ship: A ship which is not a passenger vessel and is meant to carry cargo.

Collier: A coastal vessel designed to carry coal.

Coastal Vessel: A ship which goes a short distance and is exclusively employed in trading between ports in India
and ports in Bangladesh, Myanmar (Burma) and Sri Lanka.

Claused Bill of Lading: Also called foul, unclean, dirty. Bill of Lading which has been endorsed by the shipowner as
the goods described therein do not conform to what is offered for shipment, e.g., package torn, damaged, stained,
etc.

Carrier: Any person or company engaged in the business of transporting goods from place to place, either by land,
sea, or air.

Carrier's Lien: the right of the carrier to retain possession of the goods till freight charges are paid.

Certificate of Origin: A document showing the place of origin of the cargo.

Channel: The lane charted in harbours for ships being towed to their berths from the open sea.

Charter Hire: Hire of a vessel on terms and conditions agreed upon between the shipowner and the charterer.

Classification Society: An organization whose main function is to carry out survey of ships whilst being built and at
regular intervals after construction.

Clause Paramount: Clause in a B/L or a C/P which stipulates that the contract of carriage is governed by the
Hague rules or the Hague-Visby Rules, etc.

Commodity Rate: Freight rate which applies to specific commodities that move regularly in large volume.

Conference: An organization of shipping companies plying their ships on a particular specified trade route.

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

Closed Conference: A conference is considered "claused" if the decision whether or not to admit a new
line/member, is left solely to the discretion of the existing members.

Clear Days: Used with a number to denote the period of time excluding the first and last days, e.g. six clear days.

Container: An aluminum or other metal box designed to enable goods to be sent from door to door without the
contents being handled. It may include transport by road, rail, sea, even air.

There are several standard sizes. The most common sizes are 20 - footer (20' long x 8' wide x 8'6' high) and 40 -
footer (40'long x 8' wide x 8'6'high).

Cargo Tonnage Capacity: If certain cargo tonnage/capacity is stated, this refers to the number of tons of 20 cwt
which the vessel can carry when loaded down to her summer loadline. Cargo tonnage is expressed in terms of
weight or measurement. A measurement tonne is usually 40 cubic feet. Most ocean package freight is taken at
weight or measurement (W/M) at ship's option. A freight tonne is a mixture of weight and measurement tonne.

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 to the time charterer on 10th June, the charter expires on 10th December.

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Cancelling Date: The date mutually agreed upon between shipowners and charterers on which the vessel must be
ready to load at the latest is called the cancelling date. Should the vessel miss her cancelling date the charterers
are entitled to cancel the C/P.

Chartering Agents/Brokers: They are specially appointed by large importers or exporters in order to take up
space 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 principles.

Closing Date: The closing date of a vessel is the latest date for delivery of goods for shipment by the vessel in
question.

Custom of the Port: This term relates to the customs and practices which have been gradually established in the
course of time in a particular port.

COGSA: Carriage of Goods by Sea Act. U.K. passed in 1924, India in 1925, USA in 1936. Legislative effect has thus
been given to the so-called "Hague Rules".

Clean Bills of Lading: Bills of Lading which do not contain any qualification about the apparent order and
condition of the goods are called "clean bills of lading". If the condition of goods upon delivery for shipment gives
rise to remarks, the bill of lading is termed "claused, foul, unclean" bill of lading.

Cable Ship: Ship designed to lay and repair power cables or communication cables on the seabed.

Capacity Plan: Plan detailing capacities and position of all cargo spaces and tanks used for fuel oil, diesel oil, fresh
water, etc.

Capesize Vessel: A vessel too large to negotiate the Suez and Panama Canals; vessels of over 150,000 tonnes dwt.

Car Carrier: A specialized vessel to carry unpacked cars which are driven on and off and stowed on special decks.

Cargo Battens: Timber strips fixed on the frames of a vessel to keep cargo away from the sides of the ship.

Cargo Plan: It shows suggested locations in the vessel of all consignments. It is drawn up before commencement
of loading. Once loading is completed a Stowage Plan is drawn up which shows the actual locations of all the
cargoes after they have been stowed in the ship.

Cargo Sweat: Condensation which occurs when a ship sails from a cool to a warm climate.

Cattle Carrier: A specialised vessel used for the carriage of live cattle.

Cellular Barge: A barge with cell guides dedicated to carrying containers.

Cellular Container Ship: A ship fitted with cell guides dedicated to carrying only containers.

Cement Carrier: A specialised bulk carrier designed for the carriage of cement.

Chemical Tanker: A tanker designed to carry liquid chemicals, such as acids, in bulk.

Cleaning Holds: Sweeping and washing the holds of a ship after a cargo has been discharged to make it clean to
load the next cargo.

Clip-on Unit: Generator (portable refrigeration unit) which can be attached to a reefer container to provide
power.

Coaming: Steel parapet around the hatchway which rises vertically from the deck of a ship, to prevent water from
entering the hold and to reduce the risk of a person falling into the holds.

Combination Carrier: Ship which can carry either bulk cargoes or cargoes of oil.

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Container Capacity: Total number of 20 - feet container units which can be accommodated on board a vessel.

Container Freight Station: Place where consignments are grouped together and packed into a container or place
where such containers are stripped.

Container Handler: Name given to any truck or equipment used for handling containers in a port.

Container Head: The end without doors of a container.

Container Port: Port specialised in handling and storage of container traffic.

Container Terminal: Part of a port where containers are loaded into, or discharged from, container cellular
vessels.

Container Yard: Place to which full container loads are delivered by the shipper to the ocean carrier and to which
empty containers are returned.

Contamination: Tainting of cargo by a strong odour, e.g. tea.

Conventional Cargo: Dry goods loaded piece by piece by means of derricks or cranes but not shipped in
containers. Also called break bulk cargo.

Conveyor Belt: Power driven belt for continuous movement of cargo from a vessel into a warehouse or vice versa,
e.g., coal, bananas, chests of tea and similar cased goods.

Crude Oil Washing: System of cleaning the tanks of a tanker by washing them with the cargo of crude oil while it
is being discharged.

Cargo Net: A rope net used for discharge of cargoes which are not damaged by crushing, e.g., rice and sugar in
bags.

Cargo Surveyor: A qualified person who is authorized to give a certificate of survey by the competent in respect
of damage, stowage, etc. He may also give his reasons for damage. Survey certificates are required to be
submitted for recovery of claims.

Casks: Barrels of wood in which wine and spirit are normally carried.

Chafing: A rubbing together of two bodies which is sometimes the cause of damage in the hold of a ship.

Closing Date: The last date fixed for receiving of export cargo at the shed where the ship is to load. Usually the
closing date is a few days before the date of sailing.

Cofferdam: A space between four walls or bulkheads in a ship, the purpose of which is to retain the water that
may leak through one of them.

Consignor: Shipper, exporter.

Container Bay - Row - Tier: Co-ordinates within a cellular container ship. A bay is the athwartship section of the
ship, one container in length. A row is the longitudinal section of the ship, one container wide. A tier is the
vertical section of the ship, one container deep. Thus the position of the container within the ship is shown as 14 -
04 - 10, i.e. Bay 14, Row 4 and Tier 10.

Container Spreader: A devise used for lifting containers from the top. This is the same size in plan area as the
container and as the guidance system it has to fit.

Container Straddle Carrier: A four-wheeled mobile vehicle which straddles the container and moves along with it.
The container can be picked up or set down by mechanically or hydraulically operated mechanism incorporated in
the engine which is placed above the container.

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Container Twist Lock: A device for locking spreader to container; container to hatch cover or container to
container on deck.

Crate: A temporary wooden package constructed around vulnerable or valuable cargo in order to protect it from
damage.

Calcutta Conference: The first liner conference formed in 1875.

Call Sign: Assigned by the national authority with which the ship is registered.

Canal Dues: Dues raised by a canal authority on vessels passing through the canal. It is usually changed on the
tonnage of the vessel.

Carving Note: Statement confirming that ship's name, port of registry, registered tonnage and draft measurement
is inscribed on the ship in the appropriate spaces.

Centre of Gravity: Point through which total mass of the ship may be assumed to act.

Chartering: Process of hiring of a vessel under C/P terms for a voyage or period of time.

Chief Engineer: Senior most officer in charge of ship's machinery and related equipments.

Chief Officer: Officer in charge of the ship's deck department.

Clearance Outward of a Vessel: The process of obtaining customs clearance of a vessel and her cargo prior to
departure from the port on an international voyage.

Cleared Without Examination: Cleared by customs without inspection

Combined Transport Bill of Lading: A B/L covering the through consignment conveyed under a combined
transport service such as road/sea/road.

Combined Transport Document: A negotiable or non-negotiable document evidencing a contract of combined

transport for carriage of goods.

Combined Transport Operator: A through transport operator involving a multimodal transport operation such as
road/sea/rail.

Commodity Rate: A rate device for particular commodities which may be subject to minimum weight restriction,
applicable to certain services and operative between specified ports.

Common Carrier: Company inviting clients -- in return for consideration -- to transport goods from one place to
another.

Consignment Note: A document which acknowledges the terms under which the goods are accepted and
conveyed and usually accompanies the cargo through out the transit.

Consortia: A company framed from a group of companies to manage a business such as found in some major deep
sea container services serving a group of ports situated in various countries.

Customs Invoice: It is a document prepared by the exporter in accordance with the requirements of customs
authorities in the country of the importer, serving as the basis of establishing the customs value of the goods and
for the calculation of customs duty.

Consular Invoice: An invoice confirmed by the Consulate of the importing country in the country of the exporter
that the exporting company is a genuine exporter and the signature of the authorized person of the exporter is
authenticated and all other particulars in the invoice are correct.

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Corporation of Llyods: More commonly known as Lloyds of London. It is an association of insurers based in
London specialised in marine and similar risks.

Cabotage: Reservation of the coasting trade of a country to ships' operating and registered in that country.

Centistokes: Measure of the viscosity of oil such as fuel oil etc. The greater the number of centistokes, the higher
the viscosity of the oil.

Convoy: Group of ships escorted along a canal.

Cranage: The use of a crane. Also used for charges paid for using a crane.

Cross Trade: To trade a ship wherever suitable cargoes are available rather than carrying cargoes to and from the
country where the ship is registered.

California Current: An ocean current flowing south along the west coast of North America to latitude 23 oN where
it moves westward to join the North Equatorial Current. It originates at the southern branch of Aleutian Current
between 40o and 50o N.

Canal: An excavated man-made waterway for navigation also, a long natural arm of the sea.

Canary Current: An ocean current that flows southwest part of Portugal and the northwest coast of Africa from
the Canary to the Cape Verde Islands where it divides to move west with the North Equatorial Current and
southeast and east to become the Guinea Current.

Capsize: To turn over; to turn upside down (Not to be confused with Capesize vessels)..

Cardinal Point: The four principal points of the compass, north, east, south and west.

Caribbean Current: An ocean current flowing westward into the Caribbean through the Yacatan Channel and
north past Florida as the beginning of the Gulf Stream System. It originates at the joining of the North Equatorial
& Guiana Currents.

Chandler: A ship chandler who sells gear and all supplies needed to outfit a ship for sea.

Coast Guard: A government organization charged with enforcing safety of sea laws, customs regulations and
other laws that apply to mariners.

Colregs 72: The International Regulations for Preventing Collusions at Sea, 1972.

Counter Current: Current running in the opposite direction either below or adjacent to the principal current.

Crossing the Line: A traditional ceremony aboard ship involving the initiation of all who have not crossed the
Equator.

Cruise: A journey or trip by sea for pleasure. It involves a number of visits or stops over a length of time.

Cyclone: A closed atmospheric circulation rotating counter-clockwise in the Northern Hemisphere (and clockwise
in the Southern). If of tropical origin, with a warm centre and strong winds of 64 knots, it becomes a tropical
storm. If winds are stronger, it becomes a hurricane or in the Indian Ocean, a cyclone or in the Western Pacific, a
typhoon.

Cast Anchor: To let go anchor.

Centre-castle: The raised part of a ship's hull amidship.

Collision: When two vessels collide they are said to be in collision.

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Displacement: The weight of the water displaced by any vessel and therefore the weight of the vessel itself.
Warships are described in terms of displacement tonnage.

Displacement Light: Weight of the vessel without stores, bunker, fresh water, cargo and passengers.

Displacement Loaded: Weight of the vessel plus stores, bunker, fresh water, cargo or passengers.

Dead Weight Tonnage (DWT): Shipping term signifying the carrying capacity of a ship. It is the difference
between a ship's loaded and light displacements and is expressed in tons or tonnes. It is that carrying capacity
which a vessel can carry when immersed to her summer loadline. Also referred to as deadweight all told.

Deadweight Cargo Capacity: Weight of only cargo which a ship can carry when immersed to her summer
loadline. It is deadweight all told less weight of bunker fresh water and constants.

Demise Charter: A demise or bareboat charter party arises when the charterer is responsible for providing cargo
and crew; whilst the shipowner merely provides the vessel. In consequence, the charterer takes over full
responsibility for the operation of the vessel. A demise charter party is for a period of time which may vary from a
few weeks to several years.

Deferred Rebate: A percentage of the net freight paid to a shipping company which is returned to the shipper at
stated intervals to ensure their exclusive support to that particular line or group of lines known as "Conferences".

Dredger: A special type of vessel designed to suck or dredge aboard sand and ballast for use ashore, or to clear
silt from seaways to ease the passage of larger vessels.

Duty: A tax levied by government on the import, export, use or consumption of goods.

Duty Paid: A form of price quotation in overseas trade which implies payment of import duty by the exporter in
addition to all the charges that are necessary for the goods to be delivered into a bonded warehouse at the port
named.

Displacement Scale/Curve: A scale which indicates (a) Displacement of the ship on her light draft. (b)
Displacement of varying drafts and the number of tons required to put down the ship one inch at various drafts.
The number of tons per inch is not a fixed number but varies according to the draft. (c) Deadweight capacity in
tons of 20 cwt with different drafts. (d) Maximum drafts on winter, summer and tropical.

Distance Freight: This 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 and the master deems it advisable to
deliver the cargo at the nearest safe port. If the extra distance is worthwhile, the so-called "distance freight" can
be claimed.

Distress Freight: When a chartered vessel is loaded on the berth and the charterers experience difficulties in
securing completion cargo at normal rates they may resort to booking cargo at very low rates (so-called distress
rates) in order to fill up the remaining space rather compelled to despatch the vessel with vacant space.

Dock: Now used interchangeably with wharf, quay, pier.

Drydock: Also called a graving dock. It is a structure into which a ship can be floated and having one entered, the
dock is emptied and repair work undertaken.

Daily Running Cost: Cost per day of operating a ship.

Dangerous Cargo: Cargo which is hazardous and usually carried on deck.

Deadweight Cargo: One tonne of this cargo is equal to one cubic metre or less. Freight on deadweight cargo is
usually payable on weight, i.e., per tonne or per ton.

Deck Cargo: Cargo carried on the open deck of a ship.

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Deck Line: 12" (or 300 mm) line painted amidships on both sides and parallel to the loadlines. The line is located at
the point where the uppermost continuous deck, known as freeboard deck, meets the side of the ship. The
distance between the deckline and each of the loadlines represent the ship's minimum freeboard allowable in
various loadline zones.

Deep Sea Trade: Long distance international maritime trade.

Deratting Certificate: Document which certifies that rats, if any, on board a ship have been exterminated.

Disbursements: Sums paid out by a ship's agent on behalf of a shipowner and recovered subsequently.

Disponent Owner: Company that controls the commercial operation of a vessel. Usually the charterer who
decides on the ports and issues his own Bs/L in a time charter.

Door-to-Door: Service provided by a Multimodal Transport Operator wherein goods are loaded into a container at
the shipper's premises and unloaded at the consignee's premises.

Double Hull: In tankers where an inner hull protects against oil spill in the event of an accident.

Derrick: A crane consisting mainly of one large beam, the foot of which rests either upon the ground or on deck,
used to handle loading or unloading.

Doldrums: The windless zone along the equator which lies between the prevailing winds of north and south
latitudes.

Drop Anchor: To let go the anchor.

Date Line: Meridian of longitude separating east and west, approx 180o. This expression helps easier recall:
"When eastward bound, add a day when westward bound, drop a day." Also called the International Date Line.

Deeptanks: Tanks in some cargo ships used to increase water ballast capacity.

Depth Finder: Same as echo-sounder or depth sounder.

Det Norske Veritas: The Norwegian national ship classification society, located in Oslo.

Direction Finder: Same as radio compass.

Distress Signal: Any recognized action that indicates an emergency and requests assistance, e.g., fog signal, gun,
rockets, etc.

Dockyard: A ship repair facility.

Double Bottom: The space in the ship between the hull at the bottom and the watertight plating immediately
above. Sometimes used for storage.

Drag: (i) The force opposing a ship's forward motion.

(ii) Any device that reduces movement such as a sea anchor.

Draught: British spelling of draft.

Drift: (i) The speed of a current in knots or miles per day.

(ii) A slow moving ocean current.

Down by the Head: When forward draft of a vessel is greater than the aft draft.

Down to her Marks: When a vessel is immersed to the appropriate loadline and therefore cannot load any further
cargo.

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Draft Survey: Survey undertaken to determine the quantity of cargo on board a ship.

Dirty Bill of Lading: A B/L which has been endorsed by the shipowner as the goods do not conform to what is
stated in the B/L, e.g. package is soiled, torn, damaged, etc. Also called "claused, foul, unclean."

Disembarkation: Process of passengers leaving a vessel.

Dock Receipt: Document issued by port authorities acknowledging receipt of goods specified therein on
conditions stated in the document.

Deballast: To pump water overboard.

Dumb Barge: This craft has no motive power of its own and has to be towed or pushed by a tug or by some other
means.

Dead Freight (DF/d.f.)

Demurrage: Liquidated damages payable to a shipowner by a charterer when the latter exceeds the laytime
permitted in the charterparty.

Define 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.

Examination: The physical inspection of goods for verification of contents, quality, quantity, etc,

Exchange Control Copy (Customs Bill of Entry): This copy is required to be presented to the bank for the
remittance to the country of shipment.

Exchange Rate: The rate at which the currency is exchanged for another.

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, 1925).

Echo Sounder: This is a sonic device which measures the depth of water under a ship. It can display the depth
either as a graph or otherwise as required. It is fitted almost to all ships. IMO recommends it for all ships over 500
GT.

Electronic Data Interchange (EDI): Paperless trading. It has many advantages such as speed, low cost, accuracy
and integrates the documentary position with all other operational activities.

Ebb Tide: The receding or running out of the sea.

Estuarial Service: Shipping services operating with in a river estuary and environs.

Export Documentation Procedures: The code of practice to process export documentation embracing the
financial, insurance, shipping, customs, etc. aspects of the international consignment.

Export Houses: Responsible as an export merchant for buying goods for export outright and selling them on its
own account; acting as an export agent for a client; or acting for an overseas buyer.

Export Invoice: An invoice issued by the exporter detailing various particulars of consignment, cost, freight,
insurance, etc.
Export Licence: The document issued by the government giving permission to export a particular item or items

Extension Forks: A forklift truck equipped to handle large-size wooden cases and other cargoes because its forks
are larger than the normal ones.

Entrepot (Port): A transhiment port with an area where goods can be stored free of customs duty.
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Entrepor Warehouse: A warehouse having a transhipment bond where goods may be stored for transhipment
without being liable to duty.

Eddy: A circular motion in water.

Ensign: Pron. ens'n. The flag carried by a ship as the insignia of her nationality.

Equinox: The time at which the sun passes through the equator in one of the equinoctial points. When the sun is
in the equator, the days and nights are of equal length all over the world. This happens twice every year, viz., on
21st March and 22nd September. The former is called the vernal and the latter autumnal equinox.

Escutcheon: The place where which the ship's name is written.

Even Keel: A ship is said to be on even keel when she lies evenly in fore-and-aft direction (i.e., in the direction of
the keel).

East Australian Current: A South Pacific Ocean Current setting southward along the east coast of Australia.

East Greenland Current: A North Atlantic Ocean Current setting towards south and then towards southwest along
the east coast of Greenland.

El Nino: A warm ocean current setting south off the coast of Ecuador. In some years the current extends south to
the coast of Peru where the normal cold, deeper, nutritious water is interrupted. This has disastrous effects on
fish and seabird life, resulting in economic crisis.

Emergency Position Indicating Radio Beacon: A small battery operated radio transmitter, automatically started
by water immersion, that floats on the surface and transmits distress signals on frequencies usually guarded by
ocean crossing commercial aircraft or by the Coast Guard.

End-Door Ship: British term for a roll-on/roll-off vessel.

Equator: A circle around the earth, equidistant between the poles, that separates it into two hemispheres, north
and south.

Equatorial Counter Current: An easterly flow along the equator between and opposite in direction to the North
and South Equatorial Currents.

Essential Oils: In cargo handling these include clove, almond, lavender, attar of roses, etc. They require special
stowage.

Estuary: The mouth of a river where the tide meets the stream and where sea water and fresh water have mutual
influence in regard to movement, salinity and temperature.

Evaporator: The machine aboard ship that makes fresh water from salt water.

Eye of a Cyclone, Typhoon: The centre of relative calm about which the storm revolves.

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.

Edible Oil Carrier: Type of tankers used to carry different types of oils for human consumption, e.g. palm kernel
oil, coconut oil, etc.

Elevator: Equipment used to discharge some bulk cargoes (such as grain) by removing them from the holds by a
continuous chain of buckets, etc.

Endorsee: The person to whom a B/L is assigned by endorsement, giving him the right to sue thereon.

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Enter a Ship (to): To get a vessel insured by a P & I Club.

Enter a Ship Inwards: To report a ship's arrival at a port to the Customs.

Enter a Ship Outwards: To seek permission of the Customs at a port for a ship to sail.

Europallet: European standard size pallet measuring 0.8 by 1.2 metres.

Excepted Period: Period during which any time used to load or discharge does not count for the purpose of
calculating demurrage or despatch.

Excess Landing Cargo: Cargo landed in excess of the quantity of the ship's manifest.

Extreme Breadth: Maximum breadth of a ship measured from outsides of her plating.

Freight: Charges levied by shipping companies for transporting goods.

Fairway: A ship channel that is safely navigable in river or harbour.

Fairway Buoy: A buoy that marks a fairway or channel.

Flush Deck Ship: Type of ship whose upper deck extends along her entire length.

Freight Surcharges: These are in addition to normal freight that shipping companies and shipping conferences are
charging to the shipper, e.g., bunker surcharge and currency adjustment factor.

Fender: An object used to keep a vessel away from, for example, a quay wall to prevent damage to the wall.

Free Despatch: This expression means that despatch money will not be paid in the event loading or discharging
operations are completed before the time allowed under the C/P.

Free Discharge: Ship is to discharge cargo free of expenses to the shipowner.

Freight Ton: A unit of measurement for calculating freight, either by weight or by measurement.

Ferry: A vessel used for sea transportation of passengers and sometimes vehicles for short distances.

Fore Peak Tank: Small tank situated at the extreme forward end of a ship.

Free Alongside: Charterer/Shipper has to deliver cargo alongside a ship within the reach of her tackle, free of
expenses to the shipowner.

Flush Hatch: Hatch cover which is flush with the deck in a tween-deck vessel to enable forklift trucks to move
easily.

Fresh Water Loadline: Line marked F on the sides of a ship which shows the maximum depth to which the vessel
can be immersed when in fresh water.

Ferry Port: Port specialising in handling ferry services.

Forward: Front of the ship.

Foul Bill of Lading: Same as claused Bill of Lading.

Freight at Destination: Freight payable by consignee at destination upon delivery of goods.

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

The following example may explain the position.

(i) A ship has suffered serious damage on a voyage by an excepted peril.

(ii) It turns out that the cost of repairing the damage is so high as to exceed the value of the vessel when
repaired.
(iii) In such a case the commercial object of the maritime adventure has been frustrated by an excepted peril
and the shipowner is under no obligation to complete the contract voyage.

Freeboard: Distance between the deck-line (uppermost continuous deck) and the relevant loadline painted on
the side of a vessel. The portion of a vessel's side that "free" of water, because that portion is not submerged.

Freedom Vessel: A popular tweendecker vessel of about 14800 dwt with a speed of 13.5 knots.

Free Pratique: This expression means that the vessel has a clean bill of health. The question of obtaining free
pratique for a vessel with a clean bill of health is a formality which can be arranged by the ship's agents before the
vessel actually obtains a berth. After berthing, the health authorities board the vessel in order to ascertain the
correctness of the information.

Free In & Out: The expression means that it is the responsibility of the charterers to load or the consignees to
discharge the cargo on their respective accounts. In other words the charterers/consignees have to pay the cost
of loading and discharging the cargo.

Final Sailing: A ship has finally sailed from the loading port as soon as she has passed the limits of the ports, being
ready in every respect to proceed on the contemplated voyage, with no intention to return.

Fertiliser Terminal: A terminal in a port dedicated to handle fertiliser cargoes.

Frost Lamp: A lamp at one time used in light houses, its advantage being that the oil was kept running in cold
water.

Forklift Truck: A lifting equipment extensively used in ports where the forks are located in front.

Feeder Service: Service provided by a shipping line in which small ships carry cargoes between ports which are
served by larger vessels and ports which are not.

Fighting Rate: Low freight rates introduced by a liner conferences to beat competition from non-conference lines.

Forwarding Agent: An agent who undertakes to convey goods from a sea-port to an inland location or vice versa
and to complete all formalities on behalf of the shipper; also called a Freight Forwarder.

Floating Crane: Crane mounted on a floating platform. It can be shifted to any part of the port to an anchorage,
whenever it is required.

Forwarding Charges: Charges for conveying goods from a sea port to an inland location or vice versa.

Freight Quotation: Freight quoted by a shipping line or liner conference as an indication only.

Fruit Carrier: A specialised vessel equipped with refrigerating system for carrying perishable goods like
vegetables, fruits, etc.

Free Harbour: A term sometimes used to cover all charges to the port of destination.

Flat Rack Container: A type of container which has no top or sides used for carrying machinery, vehicles or wood
products.

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Floating Dock: A floating structure used for repair of ships. It can be partially submerged to enable ships to move
in and out.

Free Trade Zone: A segregated area, generally (but not necessarily) situated at or near a port, into which
imported goods are allowed entry without being subjected to customs regulations relating to the imports or to the
payment of duties thereon.

Folding Flat Rack Container: It consists of a flat bed and solid ends but with open sides. It can carry cargoes for
awkward size. When these containers are empty, the ends are folded down.

Forks: Fronps fitted to a fork-lift truck to allow pallets to be lifted. The forks can be raised and lowered. They can
also lift containers.

Fork-Lift Pockets: Openings in a pallet or a container into which forks of a forklift can be inserted for lifting
purposes.

Forty Foot Equivalent Unit: 40' container (FEU), usually 40' length x 8' width x 8' 6" height.

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 where the density of water is greater.

Flags of Convenience: Registration of a ship in a country where regulations are lax and tax on profits is very low.
Panama and Liberia are popular countries for this purpose. Often referred to as Open Registers.

Force Majeure: Circumstances beyond the control of one of the parties to a contract. This can relieve that party
from performing the contract. Act of God.

Fresh Water Freeboard: Distance between the deckline of a ship and her fresh water load line.

Flash Point: Lowest temperature at which a product gives off an inflamable gas when mixed with oil.

Freight Ton: Unit of cargo on which freight rate is based, either one tonne or one cubic metre.

Full and Complete Cargo: Cargo required to fill a ship to full capacity either by weight or cubic measurement.

Full Container Load (FCL): A container that is fully loaded to full capacity, either by weight or cubic measurement,
usually (though not always) consigned to one party and usually (though not always) under one B/L.

Flag Discrimination: To encourage national shipping to grow, some governments restrict shipments, both import
and export, to their own country's fleet by giving them certain concessions in the form of lower duties, less port
charges, priority berthing, etc.

Full Liner Terms: Freight rate includes cost of sea carriage plus loading and discharging costs.

Factory Ship: A vessel with a fish processing plant on board.

Falkland Current: An ocean current flowing northward along the cost of Argentina. Orginating as part of the
westwind draft, it joins the Brazil Current and both turn east across the Atlantic.

Fathom: Traditional measure of depth of water or length of 6 feet.

Fiber Glass: Tiny glass fibers set in plastic, usually in synthetic polyester resin, used widely for boat hulls up to 100'
in length. Fiberglass is a trade name. British name is glass reinforced plastic, GRP.

Florida Current: Part of the Gulf Stream system that passes through the Florida straits and along the coast of
Florida up to Cape Hatteras.

Fjord: A narrow bay or deep inlet with high mountainous sides that is found in Norway, Alaska, New Zealand and
other places.
209
Flare Gun: A hand-held device such as a pistol used to fire pyro-techniques by a ship in distress.

Feeder Lighter Aboard Ship: A system of barge transport in which a partly submerged mother barge loads smaller
barges, rises again to her normal waterline, and is then towed off.

Flood Gate: The door of a drydock or tidal basin that controls the entrance of water.

Fog: A cloud touching the sea, causing reduction of visibility to less than 1000 metres. When issued with polluted
air it is called smog. A ship stopped because of fog is said to be fogbound.

Fog Signal: A whistle, bell, horn, etc., used to produce warning signals when in low visibility.

Forecastle: The raised part of the forward section of the main deck or weather deck.

Forepeak: The tank, compartment or space in a ship between the collision bulkhead or forward watertight
bulkhead and the stern.

Freedom of the Seas: A doctrine agreed upon internationally which states that the open seas, beyond announced
territorial limits, are free of any nation's rule or control.

Free Port: Also called Freezone. Port where buying and even manufacturing can be carried out free of most duties
and taxes.

Fresh Breeze: A wind of 17-21 knots; number 5 on the Beaufort scale.

False Keel: An addition to the main keel. It not only acts as protection to the main keel but enables the vessel to
take better hold of the water.

Foam: The flying spray of the sea.

Flood Tide: The tide is said to be at its flood when it is at its highest and therefore slack. But the turn from ebb to
flow is also called the flood, and it is just before this flood that vessels are waiting for their turn to get under
weigh.

Floor: The portion of the inside of a vessel which is below the waterline.

Flow (of tide): The tide is rising. When the ebb ceases the tide is said to flow. The tide flows at 2 o'clock means
"Tide will cease running down and begin to run up at 2 o'clock."

Free Period: In order to give time for the provision of craft, or other conveyance for cargo, a "free period" which
may vary from a few hours to several days, according to the custom of the port, is provided. It commences from
the time of commencing discharge. The term is used to describe the period when goods are entitled to be stored
free of rent charges.

Freight all Kinds: Term is used to show that the freight rate charge is not based on the individual commodity but
freight of all kinds. System whereby freight is charged per container, irrespective of nature of cargo.

Fixed Costs: Those costs which remain at a constant level irrespective of whether the service is operational or
immobile such as depreciation. Also termed unavoidable costs.

Fixing: Chartering of a vessel.

Fixture: Conclusion of negotiations through shipbrokers to charter a ship.

Gale: It denotes a wind of over 34 knots force 8 and on the Beaufort Scale and above.

Gang: The number of men employed on any particular service, say, for discharging or loading a vessel. The
number in a gang ranges according to the size of ships, type of cargo and the port.
210
Gang Board: A board used for getting on board a vessel from a quay or pier.

Gangway: (i) A narrow platform or bridge passing over from one deck of a vessel to another. (ii) A narrow passage
left between the stowage of cargo in a ship to allow men to go down for examination.

Greenwich Mean Time: The time at longitude 0o prime meridian passing through the Observatory at Greenwich.

Grave: To clean a ship's bottom.

Graving Dock: Dock in which graving may be done and ships built or repaired.

Ground: To run aground or ashore; the floor of the sea.

Grounding: Any contact between a ship's hull and floor of the sea in which the ship comes to rest intentionally or
accidentally.

Gyro: A gyro compass.

Godown: A warehouse or a cargo shed. A term used in the Far East.

Grab: A unit of cargo handling, consisting of two quarter circle metal parts which can be brought together to
make a close fit, operated by a crane or winch power.

Grab Damage: Damage to a ship caused by use of mechanical grabs.

Grain: Corn, wheat, rye, barley, oats, pulses, rice, paddy, seeds, nuts or beans. Wheat, rye and corn are
considered heavy grains; whereas barely and oats are classified as light grains.

Grain Elevator: A machine used for sucking grain out of the hold of a ship.

Gross Weight: The weight of the contents and the packaging.

Galley: Kitchen of a ship.

Gantry Crane: Any overhanging structure containing a crane. Used for stacking and picking up of containers as
required. It can be either rail-mounted or rubber-tyred. Gantry cranes are also fitted to certain container ships.

Grain Silo: Building used for the stowage of grain, found at grain terminals where vessels discharge. Usually tall
and cylindrical in shape.

General Average: In marine insurance, an expression of joint financial responsibility of the shipowner, cargo
owner, and of the master and crew. Loss or damage due to an Act of God, such as a hurricane, is shared by all.

Gentle Breeze: Breeze of 7 to 10 knots, number 3 on the Beaufort Scale.

Germanischer Lloyds: The German national ship classification society situated in Berlin.

Good Ship: Used in the preamble of a C/P meaning a fully seaworthy vessel.

Grain Cubic: The capacity in cubic feet of the cargo holds 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.

Grand Banks: A shallow fishing area hundreds of miles long off the coast of Newfoundland, once famous for
fishing. Owing to fog and gales it is regarded as a dangerous fishing ground.

Great Circle: The circle formed by the intersection of the earth's surface with a plane through the earth's centre.
A great circle course is the shortest distance between places on the earth. A great circle chart showing these
courses is used for great circle sailing.
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Guiana Current: A northward flowing ocean current off the northeast coast of South America that joins the North
Equitorial Current to form the Caribbean Current, the start of the Gulf Stream System.

Guinea Current: A branch of the Canary Current that turns southeast and then east at the Cape Verde Islands.

Gulf: A very large indentation of the coast of the coast line, larger than a bay, an area of water partly enclosed by
land.

Gulf Stream System: It is that ocean current system originating in the Caribbean with the Caribbean Current that
flows through the Gulf of Mexico and then the Florida Current and north to be known as the Gulf Stream off Cape
Hatteras. It then flows northeast to become the North Atlantic Current or the Grand Banks. This relatively warm
water divides as it approaches Great Britain and Ireland, with some water passing to the north of them and the
other going south along the coasts of France and Portugal to form the Canary Current and join the North Equitorial
Current and thus complete the cycle.

Gust: A sudden brief increase in wind velocity. A wind may be described as blowing at 20 knots, gusting at 25.

Gas Turbine: A form of ship propulsion.

General Commodity Rate: The rate established for general merchandise cargo.

General Transire : Customs warranty of inward cargo clearance.

Grain Certificate: Document giving quantity of grain shipped and vessel's draft and freeboard.

Granary : Bulk grain storage warehouse.

Groupage: The process of despatching numerous packages for various consignees under one grouped
consignment to common destination. Also called consolidation.

Guarantee: A contract of guarantee is a contract to perform the promise or discharge the liability of a third person
in case of his default.

Gas Terminal: A port terminal dedicated to the handling and storage of gases, e.g. butane and propare, in liquid
state in pressurised tanks at low temperatures.

Geared Ship: Ship equipped with her own cranes or derricks or gears.

Gearless Ship: Ship which is not equipped with her own cranes or derricks or gears and therefore it uses shore
cranes.

General Arrangement Plan: Plan of a ship which shows general lay out, number and position of holds, hatches,
tanks, cranes or derricks, decks and the location of the accommodation space and engine room.

General Cargo: Break-bulk cargo. Cargo packed in cartons, crates, bags, bales, etc., but not shipped in containers
or in bulk.

General Purpose Container: Dry freight container, most commonly used container.

Geographical Rotation: Sequence in which a ship calls at the ports on her itinerary using the most direct route
and not returning to any missed ports.

Gross Terms: Type of voyage charter in which the ship owner pays costs for loading and discharging.

Gunny Bag: Bag or sack made of coarse fibre used for carriage of certain bulk cargoes, e.g., rice and sugar.

Heavy Lift Ship: Ship designed to lift and carry exceptionally heavy loads.
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High Cube Container: 40' container of 9' 6" height.

Hopper: Container with funnel at its base to permit feeding by gravity into another container below.

Hovercraft: A craft which travels a few feet above the surface of the sea by means of a cushion of air forced
downwards.

Hague Rules 1924: Rules governing the carriage of goods by sea and enlisting the rights and responsibilities of
shipper and shipowners.

Hague-Visby Rules: Hague Rules amended in 1968.

Hamburg Rules: Another set of rules governing the carriage of goods by sea, adopted in 1978.

Harbour Dues: Charges levied against a ship by port authorities for use of the harbour.

Heel: Leaning of a ship to one side temporarily.

Hire: Money paid to shipowner by charterer for use of a ship on time charter.

Homogenous: Cargo which is of one kind.

House Bill of Lading: B/L issued by freight forwarding agent to a shipper covering the consignment which the
forwarding agent has grouped with consignments from other shippers for same destination.

Husbandry: Maintenance and repair of a ship.

Heads: Latrines in a ship.

High Seas: The open sea, beyond the limit within which nations claim the right of jurisdiction.

High Water: The top of the tide; the point of its highest rise.

High Watermark: The mark left by the tide along the coast when it recedes. It usually means the height to which
the highest spring tides rise.

Horse Latitudes: These are of little wind between 30 o to 35oN in the Northern Hemisphere, between the
Westerlies and the North East Trade Winds, and south of the South East Trade Winds in the Southern Hemisphere.

Horse Flag: A square flag displaying the device and colours adopted by a shipping company.

Hull: Body of the vessel.

Husband(ship's): The person who undertakes the direction and management of a ship, the owner paying him a
commission.

Hydrographer: One who surveys the seas and the coast and produces charts and sailing directions.

Hydrometer: An instrument for finding the density of liquids and is used to find out at to what draft a vessel
should be loaded in fresh water to have a given draft at sea.

Halfmast: To fly a flag from the centre rather than form the top of a mast, usually as a sign of mourning.

Hospital Ship: A floating hospital that by international agreement is always free from attack. Hospital ships are
generally exempted from tolls, taxes and pilotage.

Humboldt Current: Another name for Peru Current.

Hurricane: The Atlantic, Caribbean and eastern Pacific word for a cyclone or typhoon; a very dangerous tropical
storm with wind velocity of over 65 knots.
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Heavy Grain: Wheat, rye and maize are considered as heavy grain. Barley and oats are classified as light grain. In
practice, heavy grain constitutes the bulk of the grain shipments.

House Consumption: Goods cleared from ports for use in the country itself.

Half Height Container: Open top container which has standard length and width but only 4' 3" height.

Handymax: Bulk carrier of about 25000 tonnes dwt.

Handy-Sized Bulker: Bulk carrier of about 30-35000 tonnes dwt, generally intended to trade into the Great Lakes
of North America.

Harbour: A natural or artificial shelter for ships.

Hatch or Hatch Opening: Opening in the deck of a ship through which cargo is loaded into the ships or discharged
from its hold.

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

Hatch Cover: Means of closing the hatchway of a ship.

Head (of a Vessel): Forward part or bows of a vessel.

Heavy Lift Crane/Derrick: Crane or derrick to lift unusually heavy loads upto several hundred tonnes in one lift.
Hurricane Lamp: Lamp designed for use in a storm emergency.

Hardwood: Timber cut from deciduous trees, e.g., walnut, teak, mahogany and oak.

Hazardous Cargo: Cargo which, on account of its nature, requires stowage in a ship apart from the general cargo.
Port authorities use their own regulations for hazardous cargo.

Heterogeneous Cargo: A mixed or general cargo.

Hoisting: The action of a crane or winch when lifting cargo.

Inland Steam Vessel: A steam vessel which ordinarily plies on any inland water.

Inland Water: A canal, river, lake or other navigable water.

Institute Warranty Limits: Geographic and seasonal trading limits applied by the insurance market beyond which
vessels may only trade with permission of their underwriters and usually on payment of extra premium.

INCOTERMS, 1980: International rules for interpretation of terms frequently used in foreign trade (export sales)
contracts. Rules are drawn up by International Chamber of Commerce.

Ignition Point: The temperature at which the surface of oil will catch fire.

Iceberg: A large floating mass of ice that has broken off from the glacier.

Icebreaker: A powerful ship designed to move in sea ice and break open the way for other vessels.

Ice Fog: A type of fog composed of ice crystals occurring at very low temperatures in clear, calm weather at high
latitudes.

Inlet: A relatively short narrow water-way connecting one body of water with another or merely extending inland
from the sea or other body of water.
214
Intermediate Ship: Any vessel carrying both cargo and passengers (more than 12).

International Loadline Certificate: Issued by governments and classification societies showing permissible loading
under various conditions.

International Waters: Waters outside territorial limits, thus outside the jurisdiction of any country, generally
considered to be three miles.

Irmingher Current: One of the terminal branches of the Gulf Stream System flowing west off the south coast of
Iceland.

Islet: A small island.

Island: Any land completely surrounded by water. Also any raised superstructure above the main deck, a castle or
a poop.

Isobar: A line on a weather chart showing equal atmospheric pressures.

Isotherm : A line on a chart connecting areas of the same water temperature.

Isthmus: A narrow neck of land joining two land masses.

ICE A: Ice strengthened class -- ship classification term.

Inland Clearance Depot: Place where cargo, primarily containers, is cleared through customs.

In Bond: Goods liable to customs duty placed in bonded warehouse under customs surveillance or in transit under
customs seal.

Indirect Route: Any route between two points other than the direct route.

Indivisible Load: Consignment shipped as one complete unit, e.g. generator, as distinct from being knocked down
into various units for shipment.

Inflatable Dunnage: Air filled bags placed between units of cargo to prevent damage of goods in transit.

Inland Waterway: A man-made inland waterway providing shipping services to inland destinations.

In Rem (Latin): Valid against all the world.

In Personam (Latin): Valid against only a definite person.

Insulated Container: A refrigerated container suitable for conveyance of perishable cargo such as fruits,
vegetables, meat, seafoods, etc.

Insurance Certificate: Proof that an insurance certificate has been concluded.

Integral: A refrigerated container with the machinery built in.

Iron Ore Carrier: Vessels specially built for shipment of iron ore in complete shiploads.

International Code of Signals: A system of signaling by flags and the morse code, particularly for ships of different
nationalities, published in 7 languages. The first edition was issued in 1857 and the last revision made in 1969.

Ice-Bound: (i) A port which is inaccessible to shipping because of severe ice conditions. (ii) A ship which is unable
to leave a port because of severe ice conditions.

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Immediate Rebate: Discount on the freight rate offered by a liner conference to a shipper who has a loyalty
contract with that conference. The contract requires the shipper to ship all his cargoes in the ships of member
lines.

Independent Line: Shipping line which operates as a route served by a liner conference but which is not a member
of that conference. Also, an outsider or any non-conference line.

Inert Gas System: System of preventing explosion in the cargo tanks of a tanker replacing the cargo, as it is
pumped out, by an inert gas.

Insufficient Packing: Packing is not sufficient to protect the cargo at sea.

Intermodal: Carriage by different modes of transport, e.g., road, rail, sea and air.

Intermodal Tariff: Tariff of freight rate of a line or liner conference covering inland as well as ocean legs.

Internal Ramp: Ramp of roll-on roll-off ship which connects one deck with another. It could be fixed or movable.

Itinerary: List of all ports at which a ship calls on a particular voyage to load and discharge cargo.

Interface: A common boundary, e.g., the boundary between two systems or two devices.

Jetty: A pier or landing place of solid construction projecting out to sea, built to protect the entrance of a harbour
or a river.

Jerque Note: A British term for inwards clearance certificate confirming related customs formalities have been
completed.

Jet Foil: A passenger carrying craft which is basically a ship whose weight is supported by foils which causes lift by
virtue of their shape and forward velocity through the water.

Jumbo Derrick/Crane: Ship's derrick or crane provided for heavy lifts on up to 180 tonnes fitted on the deck of a
ship, the deck having been specially strengthened for it.

Jib: The arm of a crane that carries the load. It can be swung round to pick up or land its load.
Jacobs Ladder: A portable rope ladder with wooden rungs slung over the side for temporary embarkation, e.g., for
pilot to come on board. Also called pilot ladder, sea ladder or jack ladder.

Japan Current: Same as Kuroshiwo Current.

Jason Clause: Part of a voyage C/P that concerns the shipowner's right to recover from the cargo owner his share
of the general average charges in the event of an accident or casualty.

Jumboize: Conversion by increasing the size of a ship by inserting an additional section or piece of hull to increase
cargo-carrying capacity.

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.

Joint Service: Liner service operated by two or more shipping lines who jointly advertise their ships and canvass
for cargo for a particular route. Unlike a consortium there is no joint capital investment in ships or equipment.

Joint Survey: Inspection carried out by a surveyor on behalf of two parties.

Just-in-Time: System of stocking goods locally ready for prompt delivery to a purchaser. This does not make the
buyer wait till goods are manufactured.

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Keel: A ship's centreline, fore-and-aft structure running along the bottom and from which the frames and side
plattings arise. A ship is on an even keel position when it draws the same amount of water fore and aft. Lowest
point of the ship.

Keel Clearance: Minimum distance between the bottom of a ship and the bed of sea. Also called under keel
clearance.

Keg: A small cask.

King's or Queen's Enemies: Enemies of the shipowners -- a common law exception.

Kuroshiwo or Kuroshio System: Similar to the Gulf Stream System, this System of ocean currents in the North
Pacific flows first northeast along the coasts of Taiwan and Japan where it is known as Kuroshio or the Japan
Current. As the main Stream curves eastward it divides into the North Pacific Current moving east, a south curving
component, and the Tushima Current that passes into the Sea of Japan. The System originates with the North
Equatorial Current. Sometimes called the Black Current.

Kaolin Terminal: A terminal in a port dedicated to the handling and storage of kaolin or China clay.

Liner Conference: An organization whereby a number of shipowners offer services on given sea-routes on
conditions agreed upon by the members. A conference line ship is a vessel or a shipowner belonging to such a
shipping conference.

Landing Date: The date declared by the port authorities as a date on which the cargo is landed from the ship.
This date is relevant for the purpose of calculating demurrage. When two thirds of the cargo meant for a
particular point is discharged, the port authorities declare general landing date (GLD) and the last date is said to
be the final landing date.

Letter of Credit: A letter issued by the importer's bank in favour of the exporter authorizing him to draw bills upto
a particular amount (usually the contracted price) covering a specified shipment of goods and assuring him
payment against the delivery of the prescribed shipping documents, usually in his own country.

Lloyd's Agents: The Committee of Lloyd's Underwriters has appointed agents in principal ports who report to
Lloyd's all casualties (stranding, collision, etc.) which have taken place in their district and in which Lloyd's
underwriters are likely to be interested.

Lloyd's of London: A Corporation of insurance underwriters to be specializing in maritime matters. Not to be

confused with Lloyd's Register of Shipping, world's largest classification society.

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 cargo.

It is safe to say that goods admeasuring, on an average, 50 cft. (some say 35 cft, others 40 cft.) to the one can be
considered as heavy cargo, whilst goods admeasuring on an average more than 50 cft. to the ton are classified as
light cargo (See lesson on Stowage Factor).

Lumpsum Freight: A fixed sum paid to the shipowner regardless of the quantity of cargo actually shipped.

Laytime: Time allowed to a charterer in the charterparty for loading and/or discharging under a voyage charter.

Lowest Astronomical Tide: It presupposes that at the very worst there would always be sufficient depth of
available water at that particular spot.

Long Ton: English ton of 2240 lbs or 1016 kilogrammes.

Laden: Loaded with cargo.

Laden Draft: Depth of water to which a ship is immersed when fully loaded.
217
Laker Bulk Carrier: Carrier specially designed to trade in the Great Lakes system of North America. They are
usually geared and have a large number of hatches.

Lane Metre: Unit by means of which the decks on a ro-ro ship is measured. The number of lane metres in a ro-ro
ship describes its capacity. The total number of lane metres and total lane length.

Lighter Aboard Ship: A LASH ship. It is a barge carrying ship.

Lashings: Chains, straps, wires used to hold cargo/containers on a ship or inside a container to secure the cargo.
The idea of lashing cargo is to prevent it from moving during transit, thereby avoiding or reducing occurrence
damage.

Latitude: Distance north or south of the equator expressed in degrees, minutes and seconds.

Lay Up: To stop trading a ship temporarily due to bad markets conditions. During lay-up the daily running cost of
the ship is greatly reduced. Layed up vessels, specially tankers, are sometimes used for storage of oil.

Leg of a Voyage: A part of the voyage generally from one port of call to the next.

Length Between Perpendiculars: Length of a vessel measured at a certain level between two perpendiculars.

Length Overall: Maximum length between the extreme ends (forward and aft) of a ship.

Length on the Load Waterline: Length measured on the waterline when the ship is loaded.

Less than Container Load: Cargo insufficient to fill a container and therefore grouped with other consignments.

Letter of Indemnity: 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 release of goods
without production of a B/L.

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

Lift-on, Lift-off (LOLO): System of loading and discharging whereby cargo is lifted on and off a ship by use of
cranes. It is normally said of shipping containers.

Light Displacement: Weight of a ship's hull, machinery, equipment and spares. The difference between the loaded
displacement and light displacement is the ship's deadweight. Usually used for vessels for scrapping.

Loaded Displacement: Weight of a ship's hull, machinery, equipment, spares, cargo, bunkers, fresh water, crew,
etc., when the ship is immersed to her summer load line.
Light Dues: Charges levied by customs for upkeep of lighthouses.

Lighten: To remove the cargo; to reduce draft.

Load Line: Also referred to as the Plimsoll Mark, it marks a position on the side of a ship above which mark the
ship must not be loaded or immersed.

Lighter: A barge with no means of self-propulsion, usually towed by a tug used for transport of cargo from point to
point with a port.

Lighterage: the use of barges to carry cargoes discharged from a ship to lighten her or reduce her draft.

Line: Shipping line or service.

Liner Ship: Cargo-carrying ship which is operated between the scheduled and advertised ports of loading and
discharge on a regular basis.

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Liner Terms: A rate that includes freight plus handling charges at loading and discharging ports.

Liquefied Natural Gas Carrier: Ship designed to carry petroleum gas (butane or propane) in liquid form.

List: Leaning of a ship to one side.

Lock: Space in a canal enclosed by walls on the sides and at each end to allow ships to enter an enclosed dock.

Log Book: Book in which all daily events of a ship are recorded, including her speed, position, weather details, etc.

Log Carrier: Ship designed to carry logs.

Lumber Load Line: One of the lines painted on the side of a ship which shows the maximum depth to which a
ship's hull may be immersed with a deck cargo of timber.

Labrador Current: Also called Arctic Current, it is an ocean current in the North Atlantic setting southwards out of
Davis Strait and flowing down the coasts of Labrador and Newfoundland until it meets the Gulf Stream Draft. It is a
cold current after brining down ice that can end endanger shipping.

Lagoon: A body of shallow water separated from the ocean by a reef or a spit of land.

Landed Terms: Freight charges including all costs incurred in landing the goods at the destination port.

Landlocked: Surrounded by land such as a bay or protected harbour.

Lay the Keel: To place the first plate or timber of a new ship under construction.

Lee: The side away from the wind. If the wind blows from the port side then the starboard side is the sheltered or
lee side and the port side is the exposed or windward side.

Liberty Ship: A simple, man produced 10,000 ton cargo vessel built in the U.S. during world war II.

Long Range Aid to Navigation (LORAN): A system of radio position finding.

Low Water: The minimum height reached by a falling tide.

Longitude: Distance east or west of the first meridian, expressed in degrees and minutes. The first meridian is that
which passes through Greenwich.

Manifest: It is a list of cargo on board the ship, and gives full particulars of contents, marks, names of shippers and
receivers. It is often described as an "inventory" of all cargo on board. A copy is given to customs officials by the
Master of the ship.

Mate's Receipt: A temporary document issued by an officer of the ship acknowledging receipt of the goods on
board the ship. Subsequently it is returned in exchange for a bill of lading.

Metric Tonne: Spelt "tonne". A freight rate weight or measurement based on one cubic tonne equivalent 1000
kilogrammes or 2204.6 lbs.

Maiden Voyage: The first voyage that a vessel makes after all trials have been carried out.

Master: The captain of a merchant vessel.

Mercator's Projection: A system of representing the curved surface of the earth on a flat plane in which the
meridians are parallel straight lines.

Meridian: An imaginary line on the earth joining the poles and passing through the equator at right angles. The
Prime (or First) Meridian passes through Greenwich.
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Moderate Breeze : Wind speed 11 to 16 knots; force 4 on Beaufort Scale.

Moor/Mooring: Bringing a vessel to two anchors, and a vessel with an anchor out ahead and astern is said to be
moored.

Morse Code: Consists of groups of dots and dashes, each representing a letter of the alphabet. The symbols can be
transmitted by sound, light, radio or by waving of a flag.

Master's Certificate: Certificate of a Master's competency.

Measurement Tonne: Freight rate cubic assessment Measurement is based on forty cubic feet equals one ton
(2240 lbs) or 1000 kg equals 35.5 cu.feet (one cubic metre).

Multipurpose Vessel: A ship so designed to carry a variety of cargoes in different forms such as containers,
vehicles, breakbulk, etc.

Multipurpose Berth: A seaport berth able to handle a wide variety of cargo, that is, pallets, containers, break-bulk
cargoes involving vessels of differing specifications.

Manhole: A round or oval access to compartments, tanks and boilers that is fitted with a bolted water-tight cover.

Metacenter: The point of intersection of the verticals through the centre of buoyancy of a ship which is in
equilibrium.

Mile: a nautical mile is 6080' or 1852 metres or one minute of arc at the Equator, equivalent to one knot. The
nautical mile is known as an Admiralty Mile in U.K. A statute or land mile is used in navigating lakes and rivers and
is 5280'.

Mist: An air mass filled with tiny white droplets; a cloud touching the ground with visibility over 1000 metres.

Moulded Depth: The vertical distance in a ship measured from the top of the keel to the top of the upper deck
beam amidships.

Monsoon Current: An Indian Ocean current in an eastward direction off India & Sri Lanka.

Mooring Buoy: A large floating, well-anchored, usually flat, round structure with a heavy ring to which a ship's
wire or anchor chain is made fast.

Mooring Line: A strong rope used to secure a ship to the pier or to another ship.

Mobile Crane: A crane used on quays and in sheds for cargo handling. It is propelled and also lifts the cargo sets
with its own power.

Maccregor Hatch: Hatch cover widely used on dry cargo ships.

Marks and Numbers: Markings displayed on goods being shipped, or on their packaging, for identification
purposes.

Mini Bulker: A single deck, geared or gearless, vessel of about 3000 tonnes dwt ideal for bulk cargoes; may be
capable for taking timber or containers on deck.

Multideck Ship: Ship with several decks or levels most suited for carrying general cargo.

Maintain Class: Said of a ship which passes the survey of a classification society carried out periodically by the
ship's classification society to determine her fitness to continue trading.

Mean Draft: Average of the forward and aft draft of a ship.

220
Mother Ship: Ship which performs the main ocean leg of a voyage, being fed by smaller ships or by barges. A
barge-carrying ship.

Notice of Readiness: The master must advice charterers (or consignees) in writing as soon as his vessel is ready to
load or to discharge. A ship is ready to load or discharge as soon as the following conditions have been complied
with:
(i) The ship must have arrived at the place of loading or discharge as laid down in the C/P or as near
as she can safely get.
(ii) The ship must be actually ready to load or discharge in every respect.

Laydays start to count from the moment when the notice of readiness has been accepted by charters/consignees.

Net Tonnage: The figure representing the total of all enclosed spaces within a ship available for cargo. The
revenue earning space in a ship.

The net tonnage has replaced the net register tonnage.

New York Produce Exchange C/P (NYPE): A time charterparty approved by New York Produce Exchange.

Newbuilding: Ship which is newly built.

Nippon Kaiji Kyokai: Japanese ship classification society.

No Cure No Pay: Salvage money is not payable unless property is salved.

Non- Hygroscopic Cargo: Cargo which does not absorbs moisture.

Non- Vessel Owning/ Operating Common Carrier: Person, agent or company who which does not own or operate
the carrying vessel but who which contracts with a shipping line for the carriage of goods of third parties.

Nautical Almanac: Tables of positions of celestial bodies used in navigation.

Navigation : The art and science of directing ships' movements over and under the sea.

Neap Tides: The tides which twice in a lunar mouth rise and fall the least from the main level, in contrast to spring
tides.

Nodal Point: In tidal phenomena the place where the rise and fall of the tide is a minimum despite maximum
current.

Norske Veritas: A ship classification society of Norway.

North Atlantic Current: The northerly part of the Gulf Stream System originating off the Grand Banks as the end of
the Gulf Stream.

North Equatorial Current: The major east to west flow of water in the North Atlantic in the Trade Wind belt north
of the Equator. It is fed by southeasterly currents off the coast of Africa and provides the major source of the Gulf
Stream System. A similar current with the same name flows westward in the Pacific and is the source of the Japan
Current. Another flows in the Indian Ocean.

Norway Current: A continuation of the North Atlantic Current which moves north along the coast of Norway.

Number: A ship's four letter identification assigned when registered; also used as a radio call sign.

Net Tare Weight: Weight of an empty container, trailer, railway wagon.

Net Weight: The weight of the goods excluding all packing.

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Overstowed Cargo: Cargo stowed in such a way that it cannot be unloaded with the rest of the cargo for a
particular port or destination. The shipping company is under obligation to make the correct delivery of the cargo
eventually.

Open Roadstead: A hazardous refuge, offering poor protection to vessels.

Open Sea: The same as the high sea, beyond the 3 mile limit over which a country claims jurisdiction .

Out of Trim: The state of a ship not properly balanced in the water.

Omni Carrier: An all purpose general cargo vessel engaged in deep sea liner trade.

Open Registries: Flags of convenience countries such as Panama or Liberia that register foreign ships virtually tax-
free.

Ore Carrier: Ships built to convey bulk ores.

Owner's Broker: Persons who acts for the shipowner in finding a cargo for his vessel for charter.

Oil-Bulk-Ore Carrier: A ship designed for all three types of cargo.

Ocean Current: A large mass of water moved by wind, temperature and density differences and subject to Coriolis
force. Together they from great circulatory systems in each major ocean area.

Oceania: The South Seas, specially the area bound by Hawaii, Easter Island, New Zealand and New Guinea.

Oceanography: The study of all aspects of the sea.

Offshore: At sea, away from the coast.

Offshore Oil Reg: A large structure designed to drill, pump and store oil at sea.

Open Harbour: An unsheltered harbour.

Open Port: A port that is free of ice.

Outturn: The final tally of cargo landed.

Outward Bound: Said of a ship departing on a voyage.

Overboard: Over the side; into the water.

Open Shelter Deck: This is a compartment or hold in a type of ship designed for carriage of general measurement
cargoes, specially light and bulky goods. For this reason extra space is provided in the form of the "open" shelter
deck.

Outreach: The distance a crane can plumb from the body of the crane so as to reach out to sets of cargo in the
holds of ships or on the quay for the purpose of lifting them.

Overloaded: A ship is overloaded when her total quantity of cargo, fuels, water, etc., puts her loadline under the
water. This makes the ship unseaworthy and it is an offence for which the master of the ship is liable to be fined.

Overstowed: This is a term given to goods in a hold destined for a port of discharge, but blocked in by other goods
to be unloaded at a later port of discharge.

Open Type Container: Type of container which has an open top covered by a tarpaulin. This is to enable cargoes
which can be loaded only from the top, e.g., machinery, timber and scrap metal.

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Off Hire: Said of a ship on time charter for which hire money has temporarily stopped to be paid by charterer
because of breakdown of ship's gear, etc.

Open Conference: Liner conference which does not require its member lines to vote on the admission of a new
member.

Open : Said of a ship which is available at a particular place to load her next cargo, having discharged the last one.

Open Hatch Bulk Carrier: Type of bulk carrier whose hatch openings correspond in size to the floor of the holds.

Open Rate: Freight rate negotiated by a shipper with a shipping line for shipping in excess of a minimum agreed
quantity of cargo on any one ship.

Orders: Instructions given by the shipowner or ship operator to the master concerning the next voyage.

Outport: Port which is served infrequently or by transhipment. The freight to such ports attracts a surcharge.

Overlanding: Cargo which has been discharged at a port for which it was not intended according to the manifest.

Pallet: A platform usually of wood, specially designed to facilitate handling of cargo by fork-lift trucks.

Perils of the Seas: In marine insurance, perils or dangers (collisions, stranding, fire, rough weather, etc.) peculiar
to sea voyage, which cannot be foreseen and guarded against by the shipowner or his servants.

Protection & Indemnity Club: An association of shipowners to provide mutual protection against liabilities not
covered by insurance, such as claims for injury to crew and loss or damage to cargo.

Protest: Declaration made by master before a Notary Public to say that damage to ship or cargo occurred due to
force majeure (Act of God), to avoid liability for damage to ship cargo.

Pilotage: Provision of port's pilots to guide the seafaring vessels from the open sea .in. and out of the harbour.

Passenger Ship: Ship carrying more than twelve passengers.

Paddy: Paddy is rice without husks removed, in contrast with clean rice which is obtained after removing the
husks. A mixture of clean rice and paddy is shipped as so-called "rice cargo". The object of mixing -- about 75%
clean rice and 25% paddy -- is to avoid the contents of the bags of rice being too close.

Prompt Ship: This expression means that a vessel can be ready to load at very short notice, say within a few days.
As a rule compared with a ship giving later readiness.

Pallet Carrier: A ship built for carrying of palletized cargo. Pallet loads are handled by forklifts and similar
machines.

Panamax: Bulk carrier of about 70,000 dwt whose dimensions enable her to transit the Panama Canal where lock
width is a limiting factor.

Paper Clamp: Attachment to a fork-lift truck for the handling of paper rolls.

Paragraph Ship: A ship whose gross tonnage is just below a certain figure which if exceeded would have involved
higher running cost.

Package: A loose term indicating any single item of cargo.

Paramount Clause: Clause in a B/L or a C/P which stipulates that the contract of carriage is governed by Hague
Rules or Hague-Visby-Rules.

Parcel: (i) Package, (ii) A complete consignment.

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Parcel Tanker: Type of chemical tanker capable of carrying a number of bulk liquids at the same time.

Peak Tank: Small tank situated at the extreme forward end (fore peak tank) or after end (aft peak tank) of a ship.
Usually holds ballast water.

Perishable Goods: Foodstuffs liable to decay.

Pier: A structure at which ships can berth, built at right angles to the shore.

Pilferage: Petty stealing of cargo.

Pilot: A qualified and experienced person who navigates a ship when she enters or leaves a port.

Pilotage Dues: Fee payable for the services of a pilot.

Plimsoll Line: Summer load line of a ship; the maximum depth to which the ship's hull may be immersed when in
summer zone.

Pooling: Sharing of cargo (or the profit or loss from freight) by member lines of a liner conference.

Port of Refuge: Port which a vessel calls at because of an unforeseen hazard to undergo repairs, refuel or resecure
cargo before continuing her voyage.

Port of Registry: Place where a vessel is registered with the authorities, thus establishing her nationality.

Portal Crane: Crane supported by a set of legs under which railway wagons or vehicles can proceed. They are also
found on ships where they straddle the holds.

Preamble: Introductory lines in a C/P in which the contracting parties are identified.

Pre-slinging: Placing goods in slings in advance prior to loading/off-loading to save time. Pre-slinging is used for
cargoes which cannot be palletised or containerized.

Products Carrier: Tanker designed to carry a variety of clean and dirty petroleum products, chemicals, acids or
even molasses.

Pure Car Carrier: Specialized vessel to carry only brand-new cars on 12 or 13 decks.

Pure Car & Truck Carriers: Special vessels to carry brand-new cars, trailers and buses on various decks.

Passenger/Vehicle Ferry: Vessel designed to carry passengers (with or without cars) and commercial vehicles with
their drivers, usually on short sea crossings.

Pontoon: Flat-bottomed vessel with a shallow draft.

Port or Port Side: The left side of a vessel when viewed forward.

Palletisation: The process of stowing cargo on pallets.

Primage: An export term meaning an addition to a quoted rate of freight paid to the shipowner.

Pacific Ocean: The largest of the world's oceans, named by Magellan, who encountered a very rare calm day as he
passed around South America from the Atlantic.

Panama Canal: A man-made shipping waterway connecting the Atlantic with the Pacific Ocean across the Isthmus
of Panama that links North and South America. Toll charges are based on the Panama Canal Net Tonnage.

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Peru Current: A cold ocean current flowing north along the coast of South America. Near the equator it curves
westward to join the South Equatorial Current. Also called the Humboldt Current.

Prhouse: The space in the ship's bridge super structure that encloses the steering wheel and the engine controls
from which the ship is piloted. Also called the wheel house.

Pilot chart: Chart that contains important information to assist in ship navigation, such as ocean currents, ice at
sea, depth of water, etc. force and direction of seasonal winds, isotherms, etc.

Pilot Ladder: A hand, light, flexible and portable ladder slung over the side of a ship to assist the pilot in climbing
the ship's side.

Piracy: Robbery and murder on the high seas, not considered acts of war. A pirate is one who commits piracy.

Polaris: The North Star or Polar Star, a guide to navigation whose direction is always within a degree or two of
true north.

Poop: An extra deck on the after part of a vessel.

Poop Deck: Deck that extends over the poop and may include a poop rail and a poop staff.

Port: A harbour or shelter for ships where loading and unloading facilities are provided as well as other
conveniences.

Portainer: A special quay-side container-handling crane for fast loading and unloading, consisting of a gantry,
supporting a horizontal boom which is stored in a vertical position when not used. It is also employed in container
stacking areas.

Pounding: The motion of a ship in a sea when there is heavy contract with the oncoming waves.

Promenade Deck: An upper superstructure deck on passenger ships.

Propeller: A rotating device to propel a ship. Two to four blades are spaced evenly around a hub in which a power-
driven shaft is fitted. The blades propel the water and thus cause the ship to move.

Pig (of Iron): Formerly used as ballast and has the advantage of being cheap.

Port Holes: Opening in the sides of a vessel, the round windows seen in ships.

Quarantine: The restriction placed on a vessel arriving from a foreign port until pratique granted.

Quay: (Pronounced Key): An artificial landing place built of stone or other solid material along the shore, for
loading or unloading of cargo.

Quarter Deck: The upper deck of a ship situated at the stern end.

Quintal: One hundred pounds.

Revenue Tonne: Weight of freight earning cargo in a ship.

Rummaging: Meticulous examination on a ship conducted by customs authorities.

Ro-Ro: A roll-on/roll-off vessel from which motor cars or trucks or similar vehicles can be driven off on to a shore
through a large door without being lifted off by a crane.

Reporting Day: The day on which the master tenders the notice of readiness.

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Radar: Radio detection and range. A system of showing the presence and position of objects by beaming shark
radio pulses from a rotating aerial and timing the return of echoes from them.

Radio-Direction Finder: An instrument for detecting radio signals and showing the direction form which they
originate.

Reefer: A cargo ship fitted with refrigerating apparatus but capable of carrying other cargo too; also, a refrigerated
ISO container.

Register: A ship's Certificate of Registry containing particulars of her dimensions, machinery, the names of her
owner and master, etc.

Rhumb: The track of a ship which cuts all the meridians at the same angle and appears on a Mercator chart as a
straight line. Rhumb is an archaic word for one of the 32 points of the compass but is no longer used.

Roadstead or Road: A place of anchorage leading into "roads" to various ports at a distance from the shore.
Example, the Hampton Roads. A good road is one well protected from gales, etc. An open road is unprotected.

Rocket: Rockets are used at sea, by night, as signals.

Rudder: The instrument by which a vessel is sterned.

Rule of the Road (at Sea): Popular name for "Regulations for Preventing Collisions at Sea".

Receiving Date: The date from which shippers of cargo may send goods to the export shed for shipment. It is
usually fixed some days before the arrival of the ship.

Rent: A charge made for the storage of goods. It is based on so much per week for each unit of cargo. The charge
is calculated in terms of weight or measurement, whichever is higher.

Rotation Number: The number given by the customs to a ship when she arrives in port.

Rake of Wagons: A number of railway wagons usually between three to six which are all coupled together

Received for Shipment B/L: Cargo received for shipment awaiting transhipment.

Refrigerated Vessel: Ship built to convey frozen or chilled cargo, e.g., butter, cheese, meat, eggs, fish.

Registered Ton: A 100 cu. ft. or 2.8317 cu. metres of a vessel's enclosed area, viz., NRT or GRT (now NR & GT).

Registro Italiano Navale (RI): The Italian ship classification society located in Genoa.

Reporting Day: Date on which master indicates to charterer that the vessel is ready to commence loading or
discharging.

Re-routing: The amended or altered route from one earlier specified.

Respondentia: Process of the Master pledging his ship's cargo at a port to secure a loan of money to enable
voyage to continue. Now rare.

Running Days: Consecutive days, one following another.

Receiver of Wrecks: An official who is in charge of all wrecks, stranded cargo ships, cargo washed ashore, etc.

Reserve Buoyancy: The watertight, non-submerged volume of a ship.

Restraint of Princes: A phrase in B/L to show the limitation of liability of a shipowner when the ship is detained by
the government against the will of the owners.

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Rivet: Mild steel pin which is heated and hammered on one end as it joins two steel plates together. Rivetting is
now replaced by welding in ship-building.

Roaring Forties: The area of the ocean between 40 o and 50o south latitude, famous for strong winds, gales and
high waves.

Roll: The rhythmic motion of a ship from side to side around its fore and aft or longitudinal axis.

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

Row: To propel a boat with oars.

Ramp: Inclined plane fitted to a roll-on/roll-off ship over which vehicles are driven and which connects the ship to
the shore.

Reach (of a Crane): Maximum distance to which loading or discharging equipment can extend outwards to lift
cargo.

Rope Sling: Piece of rope whose ends are joined together so that it forms a loop for case of lifting of cargoes in
bales or bags.
Range of Ports: Series of ports normally on the same coast, e.g., Antwerp-Hamburg range.

Rate of loading: Number of tonnes loaded per day into a ship.

Re-deliver: To return a ship to the shipowner at the end of the period of the charter.

Registration: Process of recording an ownership of a ship with the authorities.

Remaining on Board: Quantity of bunkers or cargo still on board at a particular time or place.

Removable Deck: Deck of a ship which is capable of being removed and stowed out of the way.

Steam Vessel: A vessel propelled wholly or in part by the agency of steam.

Shipping Bill: Documents presented to the customs for export of the goods giving relevant particulars in the
prescribed form.

Stern: The extreme after part of a ship.

Ship Survey: Survey of a vessel held on behalf of the master of the ship.

Shut Out: Goods not shipped though brought for shipment.

Survey: Examination and ascertainment of the contents of a package for the purpose of claim or compensation.

Seller's Lien: The right of a seller to retain possession of goods until the price is paid. Such right does not exist
when goods are sold on credit.

Surveyor to Lloyd's Register: If a vessel has sustained damage to such an extent that her sea-worthiness may be
affected, the Master will contact the surveyor of the classification society in order to ascertain what repairs have
to be carried out for the maintenance of her class.

Safe Berth: A berth is considered "safe" if a vessel can safely reach it. During her stay at the berth in question the
vessel must always be safely afloat without touching the bottom at low-tide.

Short Ton: Used in U.S.A. This is a ton of 2000 lbs.

Safe Working Load: Maximum load which can safely be carried by a crane or derrick.
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Sag (To): When the centre of the ship is depressed below the level of the two ends. Opposite of hog.
Sale & Purchase Broker: Person who negotiates the terms for the sale of a ship on behalf of the buyer or seller.

Salvage: Action taken to save a ship or her cargo from loss or damage at sea; property saved from loss or damage
at sea.

Scantlings: Sizes of materials used in the construction of a ship.

Spring Tides: The tides at full or new moon when the tides are at their highest and lowest.

Seaworthiness: Fitness of a ship for a particular voyage with a particular cargo.

Seaworthy: Ship is seaworthy when it is fit for a particular voyage with a particular cargo.

Segregated Ballast Tank: Tank in a tanker 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.

Self-Unloader: A geared bulk carrier using her own equipment for discharge.

Shelter Boards: Boards fitted along the holds of a ship to prevent shifting of cargoes such as grain.

Ship Breaker: A company of person whose business is to break ships up for scrap.

Ship Canal: Man-made waterway to enable ocean-going vessels to navigate to inland areas.

Ship Chandler: Merchant who supplies to ships stores and provisions.

Ship Broker: Person who negotiates terms and conditions between a shipowner and charterer for a commission.

Sea Bee: A barge-carrying mother ship which carries loaded barges, usually with a capacity of 850 tonnes each.

Shipper: Consignor, exporter. Person or company that offers cargo for loading to a specified port at an agreed
price and terms and conditions written in a B/L.

Ship's Agent: Persons (or company) who looks after the all interests of the ship while she is in port.

Shaft: Short for propeller shaft, the long round steel rod that extends aft from a ship's power plant to the
propeller.

Ship's Gear: Cranes or derricks fixed to the vessel.

Ship's Rail: Side of a ship.

Sweat: Condensation (moisture) which occurs when a ship sails from a warm to a relatively cool climate.

Ship's Tackle: Ship's equipment used for lifting.

Shipyard: Place where ships are built.

Shore Gear: Cranes situated on the quay for loading/discharging cargo.

Short Ton: Ton of 2000 lbs. Used in USA.

Short Form B/L: B/L which does not contain full terms and conditions of the contract of carriage.

Short Sea Trader: A vessel used to carry cargo internationally over short distances.

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Short-Landed Cargo: Cargo shown on a ship's manifest but not discharged.

Shrink-Wrapping: Method of packing palletised goods such as boxes in a material which when heated shrinks and
holds the goods tightly.

Side Door Container: Shipping container whose doors are at the side rather than at the rear.

Side Ramp: Ramp fitted to the side of a ship in a roll-on roll-off ship.

Silo: A cylindrical structure used for storage of grain.

Single Deck Ship: Ship with one deck.

Sister Ship: Ship with same specifications as another.

Skid: Wood attached to under side of a heavy package to make handling easier.

Slewing Ramp: Ramp of a roll-on roll-off ship which can swing in different directions to enable flexibility in
berthing.

Slot: Compartment in the hold of a container vessel into which a container fits.

Sous Palan: Under the ship's tackle.

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).

Spillage: Small quantities of bulk cargo lost over board during loading or discharge of a ship.

Spot: Said of a ship available to load immediately.

Spout: Pipe which projects beyond the quay and the hatchway of a ship and directs bulk cargoes such as grains
into the holds.

Spreader: Device attached to a crane for lifting containers or odd-size pieces of cargo.

Stanchion: Upright pillar in the hold of a ship which supports a deck.

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;
break-down of equipment, etc.

Stem: (i) Forward-most part of a ship where ship's sides meet the bows. (ii) Availability of cargo on the date vessel
is offering to load.

Stoppage in Transitu: Right of an unpaid seller of goods to instruct master not to deliver goods to the buyer
should the buyer become insolvent when goods are in transit.

Stowage: Area where the cargo is stowed. Position of the cargo stowed in a ship's hold.

Skipper: The master of a merchant vessel.

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 (See Lesson on Stowage Factors).

Stowage Plan: Plan, in the form of a longitudinal cross-section of a ship, which shows the locations in the ship of
all consignment.

Straddle Carrier: Wheeled vehicle that lifts and carriers containers within its own framework.
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Straddle Crane: Crane on wheels or tracks which can lift containers with in its own framework.

Stranding: Contract of a ship with the bottom of the seabed.

Strike-Bound: Said of a port where no work takes place and vessel is unable to leave the port.

Summer Draft: Depth of water to which a ship's hull is immersed in a summer zone at all times.

Summer Freeboard: Distance between the deck line and the appropriate load line for a ship in a summer zone.

Summer Load Line: Line painted on the sides of a ship which shows the maximum depth to which a ship's hull may
be immersed when in a summer zone.

Stiff: When a ship has been loaded with too much weight in the bottom of her holds she is said to be stiff. This
makes her roll heavily and with a jerking motion in bad weather.

Suez Canal: A major shipping canal between the Mediterranean and the Red Sea. Toll charges are based on Sues
Canal Net Tonnage.

Submarine: Any vessel designed to operate submerged, such as a warship or salvage ship.

Stowaway: A person hiding in a ship to make a passage without paying.

Storm surge: A sudden increase in the level of the sea along the coast due to strong stormwinds blowing on shore.

Storm: Winds of force 10 or force 11 on the Beaufort scale, often accompanied by rain, or snow.

Stores: Supplies aboard ship sold to the crew such as tobacco and spirits.

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 starboard).

Squall: A sudden, strong wind, usually accompanied by rain or snow.

South Pacific Current: An eastward flowing ocean current in the South Pacific.

South Equatorial Current: A strong westerly flow on the Atlantic, Indian and Pacific Oceans just south of the
Equator. Its counterpart is the North Equatorial Current.

Soundings: Depth of water on a chart.

Slipway: The inclined survey in a shipyard that holds the cradle in which the ship is built and on which it is
launched by sliding down into the water.

Silt: The topsoil washed into the sea silting up the river mouths, channels and harbours.

Shrimper: A boat used in trawling for shrimps.

Saloon: The dining compartment, lounge or other room for officers and passengers aboard a merchant ship.

Sandbags: Canvas bags for use in boats to fill with ballast.

Sextant: Instrument used at sea for measuring the altitudes of celestial bodies, and thereby determining the
position of a ship.

Shipwright: A man skilled in repairing of building or ships.

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Time Sheet: In order to calculate the time used for loading or discharging a vessel a time sheet is drawn up from
the statement of facts to determine if any demurrage/despatch is payable.

Tide: The periodical rise (flood) and fall (ebb) of the sea, due to the attraction of the sun and moon.

Tidal Wave: An exceptionally large wave, not due to tidal action, but usually following an earthquake or volcanic
disturbance.

Tonne: The metric unit of weight of 1000 kilogrammes.

Tornado: A violent storm occuring in West Africa and U.S.A.

Tow: To draw a vessel, barge, etc., along in the water.

Trade Winds: Those winds which, in and near the torrid zone, continue to blow more or less constantly from one
quarter. The North East Trade Wind blows from about 30o N towards the equator in the Atlantic and Pacific
Oceans; and the South East Trade Wind blows from about 30 o S towards the equator in the Atlantic, Pacific and
Indian Oceans.

Tramp: A cargo ship that is not compared to any particular route but carriers cargo anywhere that is convenient
and profitable.

Trawler: A vessel employed for fishing.

Trinity House: A body responsible in Britain for lighthouses, lightships, buoys, etc.

Typhoon: A violent storm in the Eastern Seas.

Tare Weight: Weight of an empty container or transport unit.

Tanker: A vessel which carries liquid cargo in bulk.

Tank Cleaning: The process of cleaning and/or clearing out gases from the cargo tanks in a tanker.

Tainting: Process of cargo being soiled due to odours, such as oranges tainting tea.

Tariff: List of duties payable on imported or exported cargo.

Thermal Container: Insulated container for carrying perishable cargo.

Three Island Ship: Single deck vessel on which are super imposed forecastle, bridge and poop.

Tonnage Deck: The upper continuous deck in merchant ships less than three decks and second continuous deck
from below in all other vessels.

Tonnage Mark: Mark on a ship's hull on port and starboard sides aft indicating maximum permitted draft of
vessel.

Tort: An injury or wrong independent of contract as by negligence, assault, libel or malicious prosecution.

Trading Limits: Maritime area usually specified by range of ports in which a vessel may operate.

Transire: Customs warranty for inward cargo clearance.

Trim: Difference between forward draft and aft draft of a ship.

Tween Deck: Deck inserted between two continuous decks in a ship.

Turn Round Time: Time taken to discharge and/or load a ship at a terminal or other transhipment point.

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Ton Mile: A unit representing the carriage of one ton for a distance of one mile. 5 tons carried for 5 miles would
be described as 25 ton-miles.

Trimming: The operation of shovelling grain, coal and other bulk cargoes to the wings or ends of the hold when
loading.

Tarpaulin: Any piece of canvas used to cover and protect something aboard ship.

Territorial Water: Waters adjacent to the coast of a country and over which it claims jurisdiction. Historically 3
miles, now claimed to be 200 miles.

Tidal River: River under the influence of the tide for a considerable distance upstream.

Tide Tables: The list of predicted times of high and low water and their heights.

Time Zone: One of the 24 divisions, 15o wide, into which the world is arbitrarily divided.

Transtainer: An advanced container handling method on the dockside using an overhead travelling crane and
gantry.

Trough: The hollow between wave crests.

Tug-boat: A high-powered sea-worthy vessel used for towing and pushing barges, for salvage as well as for
berthing large ships.

Tally Sheet: Written record of number of pieces of cargo, their description, marks and numbers, etc., when loaded
into or discharged from a ship.

Total Deadweight: Consists of total weight of cargo, fuel, fresh water, stores, crew, etc., which a ship can carry
when immersed to her summer load line. Difference between a ship's loaded and light displacements.

Turn Time: Time during which a ship waits for a berth.

Underwriter: In marine insurance the person who writes his name on an insurance policy, thus guaranteeing
payment in case of loss and earning the premium. In U.K. underwriters are individual members of Lloyds. Whereas
in USA an underwriter is normally a corporation.

Unstuff: Strip or unload a container.

Under the ice: Sheltered from the wind.

Under the weather: Ship damaged by weather.

Unit Load: A term applied to a load made up of homogeneous cases, bags, etc., e.g., (i) the pallet, (ii) a
package or bundle of steel or similar goods, (iii) a container (iv) pre-slinging.

Unitisation: The grouping of goods for shipment into a unit of regular size, known as a unit load.

Under Deck Tonnage: The gross tonnage of a vessel less spaces situated above the upper deck, when there are
less than three decks on the second deck from the keel in other cases.

Underway: A vessel is under way when she is not at anchor, or made fast to a shore, or aground.

Unclean B/L: Same as claused B/L.

Ultra Large Crude Carrier: Giant tanker usually over 350,000 tonnes dwt.

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Underkeel Clearance: Minimum distance between the bottom of a ship and the bed of sea or river. Also referred
to as keel clearance.

Union Purchase: Popular method of combining two derricks in a ship for the purpose of loading/discharging
cargo.

Upper Tween Deck: Space for carrying cargo situated below the main deck of a ship and above the deck which
divides the upper hold.

Variable Cost: Expenses which will vary according to the frequency of the use of a vessel such as fuel, day-to-day
maintenance, etc.

Victualling: Ship's catering.

Voyage Charter: Vessel chartered for a specified voyage.

Voyage C/P: Charter party for a specified voyage.

Voyage Estimate: Estimated cost for a specified ship's voyage.

Voyage Accounts: Statement of the costs and revenue of a voyage of a ship made after the voyage is completed
when the income and all actual costs are known.

Valve: A mechanical devise used to control the flow of liquid or gas in a line or pipe.

Ventilation: Air being sucked into a ship's propellers.

Vessel Traffic System: System operated by port authorities or coast guard to control the movement of ships in
congested waters, using radar and voice radio.

Victory Ship: A standard, 16 knot, 15000 dwt. cargo vessel built by U.S. Marine in World War II. Newer and larger
than a Liberty ship.

Very Large Crude Carrier: A supertanker smaller than an ultra large crude carrier, upto 200,000 tons.

Voyage: A journey by sea which includes both the outward and homeward trips. In marine insurance, it covers
the period from departure to arrival at destination.

Ventilated Container: A container which is designed to provide continuous ventilation for cargoes, e.g., coffee.
This is provided by a series of holes above the top and bottom side rails of the container.

Water Ballast: Water carried to increase the stability of a ship, usually in double bottom, peak or deep tanks.

Waterline: The line to which the vessel is designed to float.

Load Water Line: The line to which a loaded vessel may be immersed with safety. Between these lines there may
be any number of water lines.

Wharf: A loading place for vessels in a harbour or river for shipping or landing of cargo.

Wind: Described according to the direction in which it blows upon a vessel, or the compass point from which it
blows.
Winds: Currents in the atmosphere covering air with more or less velocity from one part to another.

Windlass: The machine in the bows of a vessel used for heaving in the anchor cable.

Wreck: The destruction of the ship by the sea. The ship herself after this wreck.
233
Wreckage: Goods cast up by the sea after a ship wreck.

Warehouse Entry: Customs entry detailing cargo housed in a bonded warehouse.

Warranty: An undertaking by the assured whereby he promises to comply with the terms of the warranty.

Windward: The side from which the wind blows.

Weather Routing: Service provided by a company or a Government advising a vessel with a route for his ship. This
the route need not be the shortest route but is expected to take less time since it avoids bad weather conditions
which require a reduction in speed.

Weight/ Measurement Ratio: Ratio of a cargo's weight to its cubic measurement, expressed in cubic feet to the
ton or cubic metres to the tonne.

White Product: Refined petroleum products such as motor spirit, aviation fuel or kerosene. Also referred to any
clean (petroleum) products.

Worldscale: Scale by means of which tanker freight rates are quoted.

York- Antwerp Rules: Set of rules, revised several times, which governs general average.

Yard: Shipyards; the place where ships are built.

Yacht: (Pron.Yawt). Any vessel used for pleasure.

Yellow Flag: The flag carried by vessels in quarantine.

Zenith: The point in the celestial sphere directly overhead.

Zero Rating: Goods which do not attract any customs duty.

Zone Time: Time kept which is exactly a given number of hours ahead or behind GMT. Easterly zones are labelled
minus and westerly zones plus. Each is of 15o longitude, the distance the sun travels apparently in one hour.

oooooo

SELF-EXAMINATION QUESTIONS
1. Explain the following terms?
(a) Free despatch (b)Free pratique
(c) Break bulk cargo (d)Extreme breadth
(e) Flow of tide (f)Fighting rate
(g) Cross trades (h)Cabotage
(i) Fresh water allowance (j)Flush-deck ship
(k) Equinox (l)Economic speed

2. Differentiate between:
(i) Demurage and Despatch
(ii) Capsize and Capesize
(iii) Pallet and Crate
(iv) Chief Engineer and Chief Officer
(v) Particular and General average
(vi) Bailor and Bailee
234
3. Write brief notes on:
(a) Electronic data interchange (b)Exception clauses
(c) Free trade zone (d) Flags of Convenience
(e) Grab damage (f) Contract of guarantee
(g) Geographic rotation (h) Light dues

4. Give approximate dwt of following vessels:

(i) Very large crude carrier (ii) Handy size/max
(iii) Capesize (iv) Panamax
(v) Suezmax (vi) Mini-bulker

5. In your own words give the meanings of:

(a) Primage (b) Antifouling
(c) Broken stowage (d) Address commission
(e) Deckline (f) Banker’s indemnity
(g) Accommodation ladder (h)Deratting certificate
(i) Bailment (j) In apparent good order and condition

6. There are various types of freight. Explain what do the following signify.
(i) Back freight (ii) Distress freight
(ii) Distance freight (iv) Dead freight

7. Which of these statements are correct. If wrong, correct the statements.

(a) Quay is the upper deck of a ship.
(b) Propeller is the rotating device to propel a ship.
(c) Rotation number is a ship’s certificate of registry.
(d) Ship’s tackle is the side of a ship.
(e) Unclean bill of lading is acceptable to the bank.
(f) Reporting date is the date from which shippers of cargo may send goods.

8. Explain precisely the significance of the following:

(i) Emergency position indicating radio beacon (ii) Bay-row-tier
(iii) Lee side (iv) Lumber load line
(v) Just-in-time concept (vi) Carving note
(vii)Lashings (viii) Institute trading limits

9. What do the following words/terms mean to you?

(a) Flush hatch (b) Coaming
(c) Running days (d) Keel clearance
(e) Bridge (f) Deferred rebate
(g) Excepted period (h) Feeder service

10. Explain the difference between

(i) Displacement light and Displacement loaded
(ii) Dead weight all told and Deadweight cargo capacity
(iii) Bale capacity and grain capacity
(iv) Isobar and isotherm
(v) Open port and open conference
(vi) Port side and starboard side

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11. What are the functions of:
(a) Floating dock (b) Bill of Lading
(c) Cargo surveyor (d) Bulbous bow
(e) Corporation of Lloyds (f) Ship chandler
(g) Coast guard (h) Floating crane

12. Define:
(i) An entrepot (ii) Escutcheon
(iii) Fresh water loadline (iv) Gross terms
(v) Hydrographer (vi) Geared vessel
(vii) Cabotage (viii)Bleeding wing tank
(ix) Airdraft (x) Ballast bonus

13. Match items in A with items in B:

A B
(a) Bore (i) Beam
(b) Door (ii) Bollard
(c) Mooring (iii) Tide
(d) Container (iv) Bow ramp
(e) Width (v) Box rate
(f) Floating object (vi) Principle of Archimedes
(g) Buoyancy (vii) Buoy

14. What is the purpose of:

(a) Extension forks (b) An evaporator
(c) Cofferdam (d) Draft survey
(e) Tender (f) General arrangement plan

15. What are the special features of the following containers?

(i) Folding flat rack container (ii) Ventilated container
(iii) Thermal container (iv) Hi-cube container
(v) Open type container (vi) Half-height container

16. What are the following equipments and what are they used for?

(a) Elevator (b) Spreader

(c) Straddle carrier (d) Forklift truck
(e) Transtainer (f) Spout
(g) Ship’s tackle (h) Slewing ramp

17. The following terms relate to ships. Explain them:

(i) Fore peak tank (ii) Inwards entry
(iii) Galley (iv) Cargo battens
(v) Lakers (vi) Trim
(vii)Scantlings (viii) Even keel

18. Who incurs expenses to load cargo under the following terms?
(a) Free in and out (b) Full liner terms
(c) Free alongside (d) Free discharge

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19. Match Classification Societies and where their
A B

(i) Bureau Veritas (a) Berlin

(ii) Norske Veritas (Det) (b) Genoa
(iii) Germanischer Lloyd (c) Tokyo
(iv) Nippon Kaiji Kyokai (d) Hovik
(v) Registro Italiano (e) Paris

20. What is another name for:

(a) Japan Current (b) Labrador Current
(c) Humboldt Current (d) Black Current

RECOMMENDED FOR FURTHER READING:

1. Bes' Chartering & Shipping Terms -- N.J. Lopez, 11th Ed., 1992.

2. Illustrated Dictionary of Cargo Handling -- P.R. Brodie, 2nd Ed., 1996.

3. Dictionary of Shipping Terms -- P.R. Brodie, 3rd Ed., 1997.

4. Containerization & Multimodal Transport, Dr. K.V. Hariharan, 2nd Ed., 1997.

5. Cargo Work -- Kemp & Young, 5th Ed., 1990.

6. Know Your Own Ship -- Walton, 1970 Ed.

7. Glossary of Cargo Handling Terms – Capt. Course & Col. Oram, 2nd Ed., 1974.

8. The VNR Dictionary of Ships & Sea – Capt. V. Noel.

9. Dictionary of Shipping/International Trade Terms – A. E. Branch, 2nd Ed., 1982.

***************

237
 Three Model Test Papers have been kept below
for each subject.

Every Correspondence Student is to

compulsorily answer two Test Papers on
each subject and send them back to the
Institute before 31st December, 2020 in
order to be eligible to take up March 2021
Examination.

~t
******************

238
 Narottam Morarjee Institute of Shipping

FIRST YEAR

SHIPPING PRACTICE

TEST PAPERS

THE TEST PAPERS GIVEN BELOW ARE ONLY TO ASSIST THE STUDENTS IN
PROBING THE DISTANCE EDUCATION PROGRAMVDE CORRESPONDENCE
NOTES FOR PROPER ANSWERS AND IN NO WAY REFLECT THE PATTERN OF
THE ACTUAL EXAMINATION QUESTION PAPERS.

Test Paper 1

1. What is a classification society and what does it do?

2. Discuss the difference between liner and tramp shipping.
3. What are the types of cargo handling equipment used for loading and
discharging containers?
4. What is the difference between the bill of lading and the mate's receipt?
5. List ten different types of ships and their uses.
6. What is the role of an agent?
7. What is chartering? What are the different types of charters?
. 8. Expand and explain the following terms: LC, BV, SHEX, CIF, tpi and
BIMCO.

Test Paper 2

1. Name five classification societies.

2. Describe the main differences between a bulk carrier and a tanker?
3. What role does a freight forwarder play in liner shipping?
4. What are the functions of the bill of lading?
5. Discuss the different roles of the port agent and the liner agent.
6. How is dry bulk cargo loaded and discharged?
7. What is the difference between the statement of fact and the notice of
readiness? \
8. Expand and explain the following terms: SOLAS, ULCC, YAR, FAK, DNV
and MO.
239
 NAROTTAM MORARJEE INSTITUTE OF SHIPPING

FIRST YEAR

SHIPPING PRACTICE

THE TEST PAPER GIVEN BELOW IS ONLY TO ASSIST THE STUDENTS IN PROBING
THE DISTANCE EDUCATION PROGRAMME STUDY MAJERIAL FOR PROPER
ANSWERS AND IN NO WA Y REFLECTS THE PA TTERN OF THE ANNUAL
EXAMINATION QUESTION PAPER.

TEST PAPER 3

1. What is the difference between CFS and ICD?

2. Describe the organization of a shipping company indicating the main

functions.

3. Describe the procedures for import of cargo.

4. What do you mean by the concept of intermodalism?

5. Write names of five statutory certificates that must be kept on board a

ship.

6. How is refrigerated cargo carried on ships?

7. What is meant by unitization of cargo? Describe different methods of

unitization.

8. Suppose you are working in a freight forwarding company. Write a letter

to a prospective shipper indicating FCL rate for export of a container to
USA.

**********

240
 ANNEX-1

SHIPPING PRACTICE FIRST YEAR

SPECIALIZED VESSELS & TYPES OF TANKERS

1.0 INTRODUCTION :

1.1 In GST Lesson 1 "The Ship - An Introduction" ships were classified into 5 categories, the last
one being merchant ships -- our area of interest.

1.2 Merchant vessels were further divided into 3 basic categories and Lesson 2 of the same
series entitled "More on Ships" gives details of the General Cargo Ship, Bulk Carrier and the Tanker.

1.3 In this lesson we shall deal with some of the more popular specialized vessels.

1.4 This is not intended to be a sole reference text but just to provide an introduction as well as
an idea of how to find out about the specialized vessels we come across in our working lives.

1.5 Before we discuss about the specialized vessels let us have a quick review of the common
types of general cargo vessels.

2.0 TWEEN DECKERS :

2.1 They have 2 decks, an upper/main deck protecting the hold spaces from weather and having
hatches in it for access to the upper holds. The other deck is the tween deck, a transverse partition
2/3rd way between the tank tops (floor of the hold) and the maindeck. The tween deck has large
hatches and is flush with the floor of the hold to allow free access for cargo working and stowage.

2.2 Usually, heavy cargoes are stowed in the lower hold space between the tanktops and the
tweendeck and light weight, high volume cargoes are stowed in the tweendeck space between the
tweendeck and the main deck. Eg: Steel Coils/Billets are stored in the Lower hold and Automotive or
light weight Cases are stowed in the Tween deck.

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3.0 SHELTER DECK VESSELS:

3.1 Resembles the tweendeck vessels in having two decks. The lower/tweendeck is the main
weight-bearing deck and the upper deck is a protective covering deck. This design came into
existence to exploit the tonnage regulations and maximize cargo capacity, while minimizing tonnage-
based liability.

SPECIALIZED VESSELS

4.0 REFRIGERATED SHIPS:

4.1 Used to carry perishable cargoes which are cooled, super-cooled or frozen by using air cooled
to the desired temperature.

4.2 Presence of many insulated tween decks allow for carriage of multiple commodities and
parcels segregated in different temperature zones. The decks may be strengthened to allow forklifts.
Large hatches are provided for easy access though this means it is difficult to maintain steady
temperature. Reefer vessels may have decks and ramps for forklift access. In addition, they may
have conveyors or cranes to lift pallets and forklift respectively.

5.0 BULK CARRIERS:

5.1 They are single decker vessels capable of carrying cargo underdeck protected from weather
and used for carrying large quantities of bulk commodities. These ships have unobstructed, large
holds and hatches and are usually gearless.

5.2 Handysize bulkers are usually equipped with cargo gear, whereas Suezmax and Capesize
vessels are gearless.

5.3 Some bulkers such as Handysize, Suezmax, Panamax and Capesize vessels are covered in
Lesson 2, entitled "More on Ships". Some of the dedicated bulk carriers are:

6.0 LAKERS :

6.1 They are grain carrying bulkers having self-trimming facilities usually geared, that is, having
derricks, cranes or grabs. The holds have multiple hatches and bleeding wing-tanks which are
suitable for carriage of cargoes, ballast and help in self-trimming. The holds have "hoppered " lower
corners to prevent shifting and allow for the carriage of ballast.

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7.0 ORE CARRIERS :

7.1 They are used for carriage of bulk ores, minerals and slag and cargoes having stowage factors
less than 25. These vessels are self-trimmers with compact strengthened tank tops, large double-
bottom tanks and compact holds. Ore carriers are usually gearless.

8.0 LOGGERS :

8.1 Loggers are used to carry ores, logs, cement and allied heavy cargoes on and underdeck,
depending upon the securing arrangements. The vessels are strengthened and geared and logs are
loaded horizontally so as not to obstruct cargo gear. These vessels have squarish and unobstructed
holds.

9.0 CEMENT CARRIERS:

9.1 They are bulkers capable of carrying bulk cement or cement clinkers. The air pollution
problem is solved by making holes in the hatch covers to pump cement in through one hole and air
and dust out through another hole.

10.0 LUMBER AND PAPER PRODUCT CARRIERS:

10.1 Built to maximize volume utilization, having large, unobstructed rectangular holds. These
vessels are open-hatched geared vessels with gantries of 25 tonnes capacity. The vessels
compartments are water-tight and the ship is built light, but strong enough to withstand the stresses
of the voyage

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11.0 THE CONTAINERSHIP FAMILY: Container carriers are vessels either built or re-designed to
carry full loads of 20'/40' and other ISO sized containers. There are basically 2 types of container
carrying vessels.

11.1 CONTAINER ORIENTED VESSELS -- In this type general purpose (GP) vessels have been fully-
fitted with 'shoes' and brackets and other container securing devices for carriage of containers under
deck as well as on deck. Twist-locks and lashings are used for securing on-deck containers. These
vessels may be geared and the crane capacity may be as much as 30 metric tonnes or even more.
Spreaders are generally used for loading and discharge of units.

11.2 CELLULAR CONTAINER VESSELS -- They are built with cell-guides which criss-cross to form
cells -- rectangular spaces into which the TEUs and FEUs can be used for carriage, rather like ice-
cubes in an ice-tray.

11.2.1 The containers are carried in tier upon tier of such cells, both under-deck (60%) as well as on-
deck (40%) using twist-lock system and cell guides. The entire hold of such cells constitute a 'bay'.

(Bay -Row-Tier are co-ordinates within a cellular container vessel. A bay is the athwartship
section of the ship, one container in length. A row is the longitudinal section of the ship, one
container wide. A tier is the vertical section of the ship, one container deep. Thus the
position of the container within the ship is shown as 14-04-10, i.e. bay 14, row 4 and tier 10.)

11.2.2 Container carriers are also fitted with reefer plugs to carry refrigerated containers for the
carriage of perishable cargoes in controlled temperature and atmosphere.

11.2.3 Container ships are classified by their size:

1st generation vessels less than 1000 TEUs

2nd generation vessels 2000-3000 TEUs
3rd generation vessels 3000-4000 TEUs
4th generation vessels 4000-5000 TEUs
5th generation vessels 5000-6000 TEUs
6th generation vessels Over 6000 TEUs

Now the latest in the offering are the TRIPLE “E” vessels which are being built. The TRIPLE “E”
stands for
1) Energy Efficient
2) Environmentally friendly
3) Economies of Scale

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11.2.4 The latest orders being placed are in the range of 20000 TEUs and above. These and other
large container ships are deployed on the deep sea container trade routes around the world. They
call at a few suitable ports (currently 15 only) world-wide where the ports have drafts, cargo-volumes
and infrastructure to handle such gearless giants.

11.2.5 With the entry of the big container vessels, the smaller container carriers are deployed on
feeder routes, short-sea routes carrying containers from a range of hub / transshipment ports to
various destinations or vice versa. However, the feeder vessels which used to carry few hundred
units are now carrying in thousands containers.

12.0 BARGE CARRYING VESSELS :

12.1 They are similar to container carriers in function. The units they carry are called barges. They
allow for carriage of large volume cargoes, either unitised or bulk. The barge units may be dumb-
barge (with no motive power) or may be self-propelled.

12.2 The vessels are usually geared and/or have other methods of loading/discharging by
themselves.

12.3 LASH stands for Lighter Aboard Ship. A LASH vessel can carry 80 barges, carrying 400 tons of
cargo each and is geared having one 510-ton gantry crane situated astern the vessel to lift on/lift off
the barges.

12.4 SEEBEE carries 38 barges of 1000 tons each which can be handled in pairs by elevators
located at the stern of the vessel.

12.5 BACO -- Barge and Container carrier which is typically a ship of about 20,000 DWT, capable of
carrying a dozen barges. The barges are loaded by being floated in through the doors in the bows
and then the doors are closed and the water pumped out leaving the barge in to be lifted on board.

245
The procedure is reversed to discharge the barges. In addition, the vessel can accommodate
approximately 500 TEUs.

12.6 LO/LO VESSELS Lift on/lift off vessels are heavy lift vessels to lift cargoes which are too
heavy to be handled by the regular shore gear. These vessels generally handle indivisible loads
greater than 50 tonnes.

12.6.1 The vessels have cranes of 150 to 1000 tonnes SWL to lift on board the heavy loads. The
other strategy is for the vessel to submerge and position itself below the heavy lift and then deballast
and rise up with the load, such vessels being called semi-submersibles.

13.0 RO/RO :

13.1 These vessels are Roll on-Roll off vessels. The freight units are rolled/driven on and off board
and the vessels have multiple decks connected by ramps and lanes. The ramp platform which bridges
the vessel's deck/entrance with the shore/quay may be situated on the side of the vessel or it may be
located astern or at the bow.

13.2 The ramp generally a stern quarter ramp allowing a smoother docking with the quay. In some
ships the stern ramp is 12m wide and can take loads of 500 tonnes.

13.3 The vessels may be deployed in short ferry routes where the freight may be passengers,
vehicles, palletized/containerized as well as general cargoes.

13.4 There are specialized ro/ro vessels for carriage of vehicles only such as the PURE CAR
CARRIERS (PCCs) and the PURE CAR AND TRUCK CARRIERS (PCTCs). They may carry as many as 6000
cars which may be just driven on board at the required deck parked and lashed for the voyage and
unlashed and driven off at the destination.

For a live video of a Ro Ro Vessel visit https://youtu.be/BLbTegvRg0U

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14.0 COMBINATION CARRIERS (OBOs & O/Os):

14.1 These vessels carry liquid as well as solid bulk cargoes. Both have general features of the
typical self-trimming bulk carriers and were built on two popular concepts.

14.2 OBOs (ore/bulk/oil carriers) carry ore, dry bulk commodities as well as oil and the O/Os
(ore/oilers) carry ore and oil. PROBO is a modification of the OBO carrying only products (oils), dry
bulk commodities and ores.

14.3 The characteristics of OBOs are strengthened tank tops, floodable cofferdams, presence of
hoppered holds and wing tanks as well as presence of double skin. The hatches have oil and gas
tight, side rolling, steel hatch covers. There is lot of space to carry ballast and the same big
compartments are used to carry ore/oil or dry bulk on different voyages.

14.4 O/Os have small central holds for ore/dense cargoes. Oil can be carried in any of the
compartments including the central one. But in keeping with the International Rules oil and ore
cannot be simultaneously carried.

14.5 The disadvantage of combi-carriers is that they are difficult and expensive as well as time
consuming to clean and switch.

15.0 EDIBLE OIL CARRIERS:

15.1 Edible oil carriers are usually small to medium size tankers (parcel tankers). They have their
tank-walls coated with suitable chemicals to prevent corrosion and contamination. Also the coatings
make it possible for the tank surfaces to be cleaned properly between cargoes.

15.2 These tankers often carry 'parcels' of different types of oils. Hence they require to have at
times separate pumps and pipe line systems for each block of tanks carrying the same cargo.

TYPES OF TANKER

1.0 CLASSIFICATION OF TANKERS

TYPE TONNE DEADWEIGHT

1. Premium Range <16500

2. General Purpose (G. P.) 16500 - 24999
3. Medium Range (M.R.) 25000 - 44999
4. Long Range I (L.R.I) 45000 - 79999
5. Long Range II (L.R.II) 80000 - 159999
6. Very Large Crude Carrier (VLCC) 160000 - 319999
7. Ultra Large Crude Carrier (ULCC) >320000

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2.0 Besides the above other size descriptions used in the tanker trade are:

2.1 AFRAMAX: This term has been accepted to mean a maximum of 79999 DWT or the largest
tanker size in the AFRA Freight Rate Assessment Scale as shown above.

2.2 PANAMAX: This term implies to the largest size of vessels, which can transit through the
Panama Canal in laden condition. Students are aware from their Geography lessons that the Panama
Canal has a restriction of beam (106 feet) and draft (about 39 feet).

2.3 SUEZMAX: This term implies the largest size of vessels which can transit through the Suez
Canal in laden condition. Due to technological developments in shipbuilding and the continuous
dredging of the canal, ships of 150000 DWT can now transit the Suez Canal. With the continuous
dredging programme, perhaps the day is not far away when ships of 250000 DWT would be able to
transit through the Suez Canal.

3.0 Depending upon the type of cargo a tanker is carrying, tankers are classified as:

a) Clean: Carrying Naphtha, Motor Spirit, High Speed Diesel, Kerosene, Aviation Fuel, etc.
b) Dirty: Carrying Crude Oil, Fuel Oil, etc.

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3.1 Product tankers are obviously smaller than the crude carriers for reasons of demand and are
traded in the Premium Range to the Medium Range category. However, in recent times there has
been some trading for High Speed Diesel and Naphtha in the LRI/LRII categories.

3.2 Crude oil carriers generally trade in the LRI - ULCC categories.

3.2.1 Dirty tankers are fitted with heating coils in the cargo tanks to maintain sufficient
temperature to keep the oil in a fluid state or with a lighter density for ease of discharge.

3.3 A tanker's cargo tanks are separated by a number of bulkheads to allow for segregated
transportation. Vessels have ballast tanks that are filled with seawater to maintain the necessary
draft during voyages when the vessels are unloaded. Other vessels could be equipped with
Segregated Ballast Tanks (SBT) which are meant exclusively for water and have separate piping and
pumping system.

3.4 Cargo carrying space in tankers is formed by subdividing the midship section of the ship by
two longitudinal bulkheads to form port, starboard and centre cargo tanks. The two longitudinal
bulkheads are usually positioned so that the cubic capacity of the centre tank is equivalent to the
combined capacity of the two adjacent wing tanks.

4.0 CRUDE OIL CARRIERS:

4.1 Crude oil cargoes are frequently homogenous, and different types of crudes are carried on
the same ship. However, this does not cause much concern about contamination because the crude
will be refined before sale to a customer. The largest crude oil carrier is over 500000 DWT. These
ships can usually carry one or two grades of cargo and have a relatively straightforward pumping to
pipeline system for loading and discharging. All modern tankers have to be fitted to comply with
marine pollution (MARPOL) requirement. For a crude carrier, this means that the vessel must be
fitted with a Crude Oil Washing (COW) and an Inert Gas System (IGS).

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5.0 PRODUCT CARRIERS:

5.1 Product Carriers could be clean or dirty. The clean product carriers require a great deal of
care, for the cleaning of the tanks between each of the cargoes. To facilitate cleaning, the tanks are
frequently coated with special paints, which also serve to reduce the chance of corrosion within the
tanks.

5.2 Clean product carriers will frequently be able to carry up to four different grades of cargo
without the risk of contamination. Hence, these tankers have a more complicated pump to pipeline
system and segregation as compared to their crude counterparts.

6.0 CHEMICAL CARRIERS (PARCEL TANKERS):

6.1 There are as many as 1000 chemicals being traded by sea today. Chemical tankers, however,
carry much more than chemicals. Chemical tankers carry approximately 90 million tonnes of bulk
liquid products on short sea and deep-sea trades each year. This volume is made up of organic
chemicals (43%), inorganics (16%), vegetable and animal oils (22%) and miscellaneous products
including lube oils and lube oil additives (19%).

6.2 Parcel tankers have upwards of 50 stainless steel cargo tanks, each able to carry a different
grade of cargo in a completely segregated manner, while simple chemical tankers typically have up to
25 coated cargo tanks and occasionally switch to the carriage of refined products according to
market circumstances.

7.0 GAS CARRIERS:

7.1 Gas Carriers are highly specialized category of tankers. These are the most expensive cargo
ships requiring high degree of sophistication not only in the building and running but also from the
personnel employed ashore and afloat. The two types of gas carriers are known as liquefied natural
gas (LNG) and liquid petroleum gas (LPG).

7.2 LNG comprises of ethane and methane. It is a product of a dedicated gas field and is carried
in insulated tanks at minus 104oC (ethane) and minus 176oC (methane) at atmospheric pressure to
keep it liquid.

7.2.1 LNG is a clean fuel. It is environmentally friendly besides having high thermal efficiency. It is
becoming a popular fuel particularly in the growing economies of Asia, with their populous cities and
declining air quality.

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7.2.2 LNG is regarded as a special cargo. Hence LNG carriers are usually built for certain projects
and are rarely seen in the chartering markets.

7.2.3 Unlike the tanks in a LPG carrier, the tanks in a LNG carrier are not free standing, but are
attached by special thick plating to be of extra thickness. The tanks of a LNG carrier usually rise above
deck level and have therefore to be encased in a covering system, which must be strong but
lightweight.

7.3 LPG on the other hand comprises of propane and butane. It is a by-product of oil producing
process and is kept under high pressure or it is cooled to minus 50oC to keep it liquid. LPG carriers are
also used in the carriage of chemical gas, ammonia, etc. LPG is primarily used domestically as a
medium of cooking and in industrial houses for heating purposes.

7.3.1 Size of a LPG carrier has increased manifold during the past two decades -- from 700 CBM to
70000 CBM. Cargo tanks in LPG carriers are normally cylindrical in shape constructed from aluminum
alloy and are self-supporting and free standing. Further, they are circulated to keep the heat out by
coating of a suitable material.

8.0 JUICE TANKERS :

8.1 Juice tankers or more specifically orange juice tankers which are used for the cargo carrying of
orange juice in mass quantities. One of the biggest juice tankers is the Brazilian tanker Carlos Fischer.
However, other fruit juices carriers are also available.

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9.0 CARGO HANDLING SYSTEMS :

9.1 Oil is loaded on the tanker through shore pumps and discharged by pumps installed on the
tanker. For loading and discharging ballast, the ship will again use its own pumps. Cargo pumps are
placed at the bottom of the ship, housed in special pump rooms. There is a danger that gas can
escape in a pump from the seals of the pumps, so the pump room is kept separate from the ship.

9.2 There are various kinds of pumps.

(a) Centrifugal pump:

In the largest ships the most common type of pump is the centrifugal type. The centrifugal
pump has, for many years, been the most suitable pump where a high pumping capacity is
the most important factor. The size and cost of such a pump does not increase in proportion
with the throughput, as it is not a positive displacement pump. It requires either the
provision of ancillary self-priming equipment for the removal of air in the system or a
separate stripping system.

The basic characteristics of a centrifugal pump are:-

 Throughput varies with speed.

 Head varies as speed squared.
 Power required varies as speed cubed.

(b) Positive Displacement Pump:

Unlike the centrifugal pump, the positive displacement pumps used in dedicated stripping
systems are capable of a low suction pressure and the ability to pick-up suction without
external priming. This type of pump includes steam reciprocating pumps and ‘screw’ type
pumps. Both types are now mainly used for stripping tanks or as specialized cargo pumps.

(c) Submerged Pumps:

Submerged pumps are relatively common on chemical carriers. This type of pump is usually
powered hydraulically or electrically and provides for a pump located in each tank.
Manufacturer’s instructions must be complied with for efficient operation of these pumps.

Submersible pumps are purged, using inert gas (ship’s IG or nitrogen) or air, as a means of
checking for seal condition and tightness. The pumps must be purged before and after every
loading/discharging/tank cleaning operation and the appropriate record form completed.

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(d) Portable Submersible (Emergency) Pump:

Portable submersible pumps, are provided on chemical ships and other specialized liquid
cargo carriers, for discharging cargo in the event of a main cargo pump failure. The pumps
are usually hydraulically driven and lowered directly into the tank generally through a tank
cleaning hatch.

(e) Eductors:

Eductors may be used for ballast stripping purposes. To strip efficiently, an eductor used for
tank cleaning operations should have a capacity of about twice the rate of liquid being
introduced to the tanks.
oooooo

SELF-EXAMINATION QUESTIONS
All answers should be brief and to the point
1. What is the difference between a tween decker and a shelter decker?
2. How did shelter deck vessels originate?
3. What advantage does a tween-decker have over a single-deck vessel?
4. What is the significance of hoppered holds and wing tanks?
5. What is the use of double bottoms?
6. What factors would restrict the entry of a Triple E class container vessel into port?
7. What is the purpose of
(a) cell guides
(b) twist locks
(c) shoes
8. Why is a stern quarter ramp preferred over an ordinary bow/stern/side ramp?
9. Write short notes on
(a) Triple E Container ships (b) Cement carrier (c) Loggers
(d) Edible carriers (e) PCTCs (f) Reefer
10. What is the container carrying capacity of different generation vessels?
11. Name and briefly describe different types of barge carrying vessels.
12. What are the specialities of LOLO and RORO vessels?
13. Describe the two popular types of combination carriers.
14. Explain the different ways of classifying tankers:
(a) by sizes, and
(b) by types of cargoes
15. How do product carriers differ from crude oil carriers?
16. Write a short note on cargo handling system of a tanker.
17. "Gas Carriers are most expensive and highly specialized form of tankers." Elaborate.
18. How many types of gas tankers are there and how do they differ from each other?
19. Explain the following terms:
(a) Aframax (b) Suezmax (c) Panamax.

RECOMMENDED FOR FURTHER READING

1. Shipping Practice -- E. F. Stevens, 11th Ed., 1981.

2. Bes' Shipping & Chartering Terms -- N. J. Lopez, 11th Ed., 1992.
3. Sea Trading -- Vol. I (The Ships) -- W. V. Packard, 1st Ed., 1984.
4. Sea Transport -- P. M. Alderton, 4th Ed., 1995.
5. Elements of Shipping -- A. E. Branch, 7th Ed., 1996.
*******************

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 ANNEX - 2
SHIPPING PRACTICE FIRST YEAR

TYPES OF SHIPPING OPERATIONS

1.0 Trade has always been linked with transport. From its start, some five thousand years ago (when
sledges carried tools made of flint) till today, all transactions involve transport. Obviously trade means
transport. Just because all commodities have to move in space and time, transportation is a universal
cost input and probably the only one.

1.1 Marine transport serves world trade. Some 90 % of world trade by volume and 70% by value is
carried by sea, according to the Organization for Economic Cooperation and Development (OECD). Any
changes that occur in maritime trade have direct repercussions on shipping and ports. However, we
should not forget that the converse is also true — any developments in ship design and operations
influence the movement of goods by sea, either in the short or long term. The bulk of this trade comes
from Crude Oil, Coal, Minerals & Ores and Liquefied gas.

1.2 In the 50’s the movement of crude oil had been in parcels up to 40,000 tonnes. This later
increased to 100,000 tonnes and rose to a whopping figure of about 5,60,000 tonnes a few years ago.

1.3 The function of shipping is actually the conveyance of goods from places where the utility is low
to places where the utility is high. Goods may consist of raw materials (e.g. sulpher, iron ore, chrome,
ore, etc.) moved in bulk shipments or in specially-designed containers; project equipment moved in dry
containers or on flat-rack-containers, and general commodities moved in cases or chests.

1.4 Today there are many factors that influence the choice of the shipper in selecting the mode of
transportation. The shipper takes into account the availability of complete logistics before entrusting the
job of carrying and distributing the goods. Hence factors like logistical support, just-in time (JIT) concept
and distribution centres play a major role in this decision making process.

1.5 Maritime transport is international in nature and is, as such, subjected to international laws and
regulations. Till the vessel is in its national ports and its coastal waters it will continue to follow its
national regulations. However, once it leaves the shores of its home country it is required to follow
international rules and regulations.

2.0 There are various ways in which we can classify maritime operations. Various shipping companies
have their own methods of classifying their shipping operations. Hence we hear about coastal shipping,
short-sea shipping and deepsea shipping. Additionally, we can distinguish between the transport of
cargoes and the movement of passengers. A few examples here will clarify how these operations are
classified.

2.1 One major British company has classified its shipping operations as follows:

(a) General Cargo Division.

(b) Bulk Shipping Division.
(c) Passenger Division.

2.2 In India, a major shipping carries out its operations under the following divisions:

(a) Liner Division.

(b) Cruise & Passenger Services.
(c) Bulk Carriers & Tankers Division.

NOTE: Read chapters 1, 2 &3 (The Shipping Company, the Shipowner & Merchant, & the Merchant Shipper) in "Shipping Practice "
text-book by Stevens & Butterfleld
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2.3 A North-European vessel operator has made the following operating divisions: -

(a) Short Sea Ferries.

(b) Cruise Shipping Division.
(c) Ro-Ro Sector.

2.4 What is clearly evident from the above examples is that shipping operations tend to be divided
by the type of ship being used in the operation of the service. Hence we can say that shipping operations
may be divided into the following four principal categories:-

(a) Tramp (or irregular) Services;

(b) Liner (or regular) Shipping;
(c) Specialized (or industrial) Shipping;
(d) Passenger Shipping (liner, cruise or ferries).

3.0 EVOLUTION OF THE TRAMP:

3.1 The name tramp designates a ship that moves on routes wherever cargo is available. It does not
follow any fixed routes and is unable to advertise its future schedules with any certainty. The role of
tramp shipping had developed predominantly due to two major reasons:

(a) Technical reasons— which made ships dependent upon the forces of nature.
(b) Commercial reasons - merchants had to sail on the ships resulting in irregular transactions.

3.2 When technical progress advanced, there was rapid industrialized growth and consequently an
uplift in international trade. Due to this there was an increased demand of maritime transport because
all the major territories were separated by vast expanses of oceans. It can therefore be easily understood
that the small sailing ships were in no position to cope up with the growth of international trade. Hence
the design of ships changed from wooden sailing ships to steel hulls and steam-powered vessels. These
steel-hulled steamships could now move on larger distances without calling at any intermediate ports.
With this happening, the structure of sea-borne trade began to change.

3.3 There was a continuous reduction in unit cost of goods for transportation. With such a radical
change, the merchants were in no position to sail with their goods on the ships. Hence the "shipowners"
were separated from the "merchants" (or "owners of the goods", i.e. shippers). A number of independent
shipping companies came into the scene who began to offer their transport services to anyone who
needed them. This-was "tramp" shipping.

3.4 The word "tramp" therefore describes a ship which can transport any cargo, general or bulk, over
any trade route wherever such cargo is available.

3.5 Hence the old and classical notion of tramping was based upon the following:-

(a) A tramp ship was not attached to any definite trade route or meant for any particular cargo.
(b) It was generally a multipurpose ship which could carry either dry, general cargo or dry bulk
cargo.
(c) The ships were usually in the size of 5000-15000 dwt for deep sea trades but smaller for
coastal or short-sea trades.
(d) A contract was usually concluded prior to proceeding on a voyage.

(The earliest contract for such a voyage is a document lying in the British Museum which is dated
AD 236. It contains all the basic elements of a modern contract or charter party).

3.6 Today, the tramp still does not operate on a fixed sailing schedule. It merely trades in all parts of
the world and calls at a port depending upon the inducement of cargo. It primarily moves bulk cargoes
e.g. coal, grain, timber, sugar, ore, fertilizers, minerals, etc. Usually these parcels are complete shiploads
and may be seasonal. Tramp shipping companies are usually smaller than the liner companies.
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3.7 Tramp vessels are not specialized ships. They are normally bulk carriers having between two to
six holds with large unobstructed hatch covers. They are designed mainly for the carriage of bulk cargoes.
When tramp vessels are to be used for particular trades (bauxite, phosphates, alumina, etc.) they are
fitted with special facilities and supplied with items so required for that trade.

3.8 Tramp vessels are engaged under a document called a charter party, on a time or voyage basis.

A Typical
SD-14

Length Overall 141 metres

Beam 20.5 metres
Summer Dwt 15,000 tonnes
Summer Draft 8.85 metres salt water
GRT 9200
NRT 6100
Grain Capacity 750,000 cubic feet
Bale Capacity 690,000 cubic feet
Holds 5
Derricks 6 x 5t; 4 x 10t and 1 x 50t SWL
Speed 14.9 knots on 25 tonnes F.O and 1.5 tonnes
D.O.
Cargo batten fitted. No self-trimming facilities.

Gearless
Panamax
Bulk Carrier
Length Overall 224 metres
Beam 32 metres
Summer DWT 65,000 tonnes
Summer Draft 13.4 metres saltwater
GRT 35800
NRT 23900
Grain Capacity 2,700,000 cubic feet
Holds 7
Speed 13 knots on 25 tonnes F.O. and 2.5 tonnes D.O

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4.0 EVOLUTION OF THE LINER :

4.1 Historically, the liner was a general cargo ship. It was a specially designed ship which was
planned to cope with the needs of the route which it was serving. It was not designed for carrying bulk
cargoes. This type of vessel was divided into holds having 2 or 3 divisions (between decks) so that a
large variety of goods could be successfully handled. It operated usually to one particular port or country
and sailed on longer routes. Britain's domination of the oceanic routes was based on the cargo liners
which were the pride of the shipping companies which operated them. Once these routes were
established it became difficult for others to compete against them. This was because liner shipping
needed a very complex organization ashore to accommodate the variegated cargoes for any liner vessel.
Secondly, every cargo ship was different as it was designed for the needs of a particular trade route.

4.2 The term "liner shipping" is usually taken to mean a form of ship operations over regular trade
routes between the same ports and usually following the same itinerary indicated in a published sailing
schedule. The liner continues to operate between these ports independent of the load factor of the
ships employed.

4.3 The original form of liner shipping existed in the eighteenth century when regular plying of sailing
ships existed between ports of northern Europe. However, modem liner shipping appeared only in the
first half of the nineteenth century. There were two reasons, for this.

(a) In order to provide a regular service between two distant ports one had to have a
transport that was independent of the vagaries of the weather and other forces of
nature. Such a condition could only be met with a steamship. Hence the first regular
liner service that used steamships was inaugurated in 1824. Very famous lines were
involved here e.g. General Steam Navigation Co., Cunard Steamship Co., Royal Mail
Packet Co. and steamers "Sirius" and "Great Western" crossed the Atlantic without the
help of sail.

(b) The second reason for the appearance of liner shipping was the development of
general cargo. General cargoes were moving in relatively small quantities and they
needed a regular service between ports. Sometimes these parcels were very small and
grouping of lots became important. The cargoes carried by liners are generally mixed.
They are carried in bags, bales, cartons, drums, cases, crates, etc. They are also
nowadays unitized into bundles, pallets, containers, etc.

4.4 Liners began to appear gradually halfway through the last century when steamships developed
and started offering scheduled services between ports. Then they tended to offer a faster and reliable
service at a higher price. This was attractive to shippers who had valuable cargoes and who needed to
send their consignments with regularity and at best predictable delivery dates.

4.5 Liner shipping could lay claim to being the world's first truly global industry and Like-wise it could
claim to be the industry which, more than any other makes it possible for a truly global economy to work.
Liner Shipping connects countries, markets, businesses and people, allowing them to buy and sell goods
on a scale which was not previously possible, infact certain commodities have started moving due to the
regular interval of services.

4.6 Global consumer, have become used to seeing goods from all parts of the globe readily available
in the stores we visit e.g. Kiwis being in high demand in INDIA which are exported in small scale on regular
intervals all the way from New Zealand to India. The reality is that the needs of a rapidly growing world
population can only be met by transporting goods and resources between countries and liner shipping
industry has made this process more efficient and changed the shape of the world economy.

4.7 The liner industry benefits consumers by creating choice, boosting economies and creating
employment keeping costs for the consumer down and efficiencies are improved and this in turn
minimizes impact on the environment as well and liner shipping is the most efficient mode of transport
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for goods. In one year, a single large containership might carry over 200,000 container loads of cargo.
While individual ships vary in size and carrying capacity, many container ships can transport up to 8,000
containers of goods and products on a single voyage. Similarly, on a single voyage, some car carrier ships
can handle 7,600 cars. It would require hundreds of freight aircraft, many miles of rail cars, and fleets of
trucks to carry the goods that can fit on one large liner ship.

4.8 Connects countries, markets, businesses and people, allowing them to buy and sell goods on a
scale not previously possible.

5.0 Highlights of LINER SHIPPING as follows:

 Transports goods representing approximately 1/3 of the total value of global trade.
 Responsible for millions of existing jobs and plays a crucial role in stimulating new jobs.
 Contribution of hundreds of billions of dollars to the global economy annually thereby
increasing GDP in countries throughout the world.
 Acts as a lifeblood of global economic vitality, ocean shipping contributes significantly to
international stability and security.
 In some countries it represents a significant share of the nation's gross domestic product
(GDP.)
 Liner ships transport approximately 60 percent of the value of seaborne trade or more than
US $4 trillion worth of goods annually.

6.0 Trade between an origin group of countries and a destination group of countries is referred to as
a trade route. Approximately 500 liner shipping services provide regularly scheduled service between
ports along a single trade route or a group of trade routes. Over 200 countries have ports open to
container ships. Ports measure the volume of containers they handle in (TEU). In 2011, containers
handled by all ports world-wide (including empties, transshipments and port handling) were estimated
at more than 580 m TEU.

6.1 Cargo that moves aboard liner ships must be able to move efficiently across land to connect with
the ships since the many businesses and consumers that are selling and buying goods are located long
distances from a port.

6.2 The continued efficiencies for global trade gained by the use of liner shipping are dependent upon
an inland transportation network that allows for the timely and efficient overland transfer and transport
of cargo and this is what gave birth to multi-modalism.

6.3 Ocean shipping is one of the most carbon-efficient mode of transportation and it produces fewer
grams of exhaust gas emissions for each ton of cargo transported when compared to air, rail, or road
transport. New International Maritime Organization regulations establish strict standards for vessels'
NOx, SOx, and particulate matter emissions.

6.4 Liners usually have the following characteristics:-

1. Liners mostly carry general cargo and nowadays mostly in containers.

2. The types of ships used in liner trade are general cargo ships, container ships, ro-ro ships,
etc.
3. They operate at fixed advertised schedules, Fixed arrival and departure dates with berthing
windows and fixed port rotation. (e.g.: of Port rotation as below).
4. FAK (Freight all kinds) rates and commodities based rate filing is available. Notices have
to be given in order to revise rates upward.
5. The vessel operators have to bear all operating costs.
6. Contract which binds the carrier and the merchant is the Bill of lading.

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7.0 PASSENGER SERVICE:

7.1 This is a separate type of ship operation as this involves the transportation of passengers from
one place to another. The passenger ship is quite distinct from a cargo ship, both from the constructional
point of view and equipment. Any ship that has more than 12 berths for passengers would be termed as
a passenger ship.

7.2 Passenger ships may be classed into the following types:

1. Cruise ships.
2. Ferries.

7.3 During the past few years the global cruise market has significantly increased and is said to be
growing at a rate of 10 per cent per year. CLIA (Cruise Lines International Association) 2013 global
passenger numbers are estimated at 21.3 million, with a 2014 forecast expected to reach 21.7 million
passengers. North America is the world’s biggest cruise market (55.1 percent passenger source share) –
with significant growth of internationally sourced passengers – especially Europeans at 6.4 million.

2013* Top Ten CLIA Cruise Passenger Source Market Overview

*2013 Passenger estimates (ooo’s)
2013
Global 5 Year
2013 Passenger
Country Passenger %
Passengers Source
Share Change
Rank
United States 11,016 51.70% 15.10% 1
UK & Ireland 1,719 8.10% 16.40% 2
Germany 1,637 7.70% 80.50% 3
Italy 860 4.00% 26.10% 4
Australia 760 3.60% 130.30% 5
Canada 734 3.40% 1.30% 6
Brazil 732 3.40% 84.80% 7
Spain 600 2.80% 20.70% 8
France 520 2.40% 67.70% 9
Scandinavia & 350 1.60% 184.60% 10
Finland

7.4 Globally, the 2014 CLIA fleet is comprised of 410 ships, up from 393 ships last year, and includes
a wide variety of vessels – from large- and mid-sized to small and intimate. The fleet covers all line
categories: contemporary, premium, niche and destination focused, river cruises, expedition and
adventure. Additionally, in 2014 and 2015, CLIA lines will introduce 24 new ships, representing a total
capital investment of approximately $8 billion. Twelve additional new CLIA global and regional ships
(Confirmed Orders and Options) for 2016 to 2018 represent an additional 33,192 passenger capacity and
an investment estimated at $7.9 billion in ship development.

259
7.5 The leading cruise destination in terms of ship deployments remains the Caribbean, accounting
for 37.3% of all global itineraries followed by the Mediterranean (18.9%), Northern Europe (11.1%),
Australia/New Zealand (5.9%), Alaska (4.5%), Asia (4.4%) and South America 3.3%).

7.6 In 2014, markets experiencing increased ship deployments include the Caribbean (+12%),
Northern Europe (+5.2%), Asia (+31.6%) and Australasia at +22%.

7.7 Ferries form a part of the public transport systems of many waterside cities and islands, allowing
direct transit between points at a capital cost much lower than bridges or tunnels. However, ship
connections of much larger distances (such as over long distances in water bodies like the Mediterranean
Sea) may also be called ferry services, especially if they carry vehicles.

7.8 The busiest seaway in the world, the English Channel, connects Great Britain and mainland
Europe, sailing mainly to French ports, such as Calais, Boulogne, Dunkirk, Dieppe, Roscoff, Cherbourg-
Octeville, Caen, St Malo and Le Havre. Ferries from Great Britain also sail to Belgium, Denmark, the
Netherlands, Norway, Spain and Ireland. Some ferries carry mainly tourist traffic, but most also carry
freight, and some are exclusively for the use of freight lorries. In Britain, car-carrying ferries are
sometimes referred to as RORO (roll-on, roll-off) for the ease by which vehicles can board and leave.

7.9 Large cruise ferries sail in the Baltic Sea between Finland, Åland, Sweden, Estonia and Saint
Petersburg, Russia and from Italy to Sardinia, Corsica, Spain and Greece. In many ways, these ferries are
like cruise ships, but they can also carry hundreds of cars on car decks. Besides providing passenger and
car transport across the sea, Baltic Sea cruise ferries are a popular tourist destination unto themselves,
with multiple restaurants, nightclubs, bars, shops and entertainment on board.

8.0 Ferry designs depend on the length of the route, the passenger or vehicle capacity required,
speed requirements and the water conditions the craft must deal with.

1. Double Ended Ferries:- Double-ended ferries have interchangeable bows and sterns,
allowing them to shuttle back and forth between two terminals without having to turn
around.

2. RO PAX FERRY:- RoPax ferries are conventional ferries with a large garage intake and a
relatively large passenger capacity, with conventional diesel propulsion and propellers that
sail over 25 knots.

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8.1 Some of world's busiest ferry routes include the Star Ferry in Hong Kong and the Staten Island
Ferry in New York City. The contributions of ferry travel to climate change have received less scrutiny than
land and air transport, and vary considerably according to factors like speed and the number of
passengers carried. With the price of oil at high levels, and with increasing pressure from consumers for
measures to tackle global warming, a number of innovations for energy and the environment were put
forward at the Inter-ferry conference in Stockholm. According to the company Solar Sailor, hybrid marine
power and solar wing technology are suitable for use with ferries.

8.2 Details of some of the Cruise ships being launched in 2014 as below with their capacity:

Passenger
Cruise Line Ship
Capacity
Royal Caribbean International Quantum of the Seas 4,180
Norwegian Cruise Line Norwegian Getaway 3,969
Costa Cruises Costa Diadema 3,700
Princess Cruises Regal Princess 3,560
TUI Mein Schiff 3 2,500
Pearl Seas Cruises Pearl Mist 210
Uniworld Boutique River Cruise Collection S.S. Catherine 159
Silversea Cruises Silver Discoverer (Pre-Owned) 120

SELF-EXAMINATION QUESTIONS

1. Enumerate different ways of classifying shipping operations.

2. What are the salient characteristics of a tramp vessel?
3. Define a liner vessel. "What distinguishes it from a tramp vessel?
4. Broadly speaking, how many types of passenger vessels are there?
5. What is the present trend of the passenger market?
6. Write brief notes on:
(a) Functions of shipping.
(b) Reasons for growth of liner shipping.
(c) Ferries.
7. Give full forms of following abbreviations:
(a) JIT (b) Ro-ro (c) Dwt (d) F.O. (e) D.O. (f) H.P. (g) SS (h) GT.

261
 RECOMMENCED FOR FURTHER READING

1. The Business of Shipping - Kendall, 2nd Ed., 1976.

Though published over 20 years ago, this book is intended as a guide for students of shipping,
a reference for those actively engaged in the industry, and as a convenient well-organized and
indexed source for anyone who seeks knowledge of commercial ocean shipping.

Chapter II (Pages 7 to 10) entitled " Liner Service & Tramp Shipping" gives a comprehensive and
excellent comparison of liner service and tramp shipping in a tabulated form. Essential study
for understanding the two main types of shipping services in detail.

2. Elements of Shipping - A.E. Branch, 7th Ed., 1996.

Please refer to Section 4.2 on "Tramps" and Section 4.3 on "Liners" (Pages 48 & 50). Students
who wish to go into further study may refer to Chapter 9 "Passenger Fares and Freight Rates"
(Pages 181 to 195).

*******************

262
 ANNEX - 3
SHIPPING PRACTICE FIRST YEAR

TYPES OF CHARTERPARTIES
1.0 TYPES OF CHARTERS:

1.1 There are basically two types of charters or charter parties viewed from a legal angle:

(A) Demise or Bareboat Charters

(B) Non-demise Charters (Voyage and Time Charters).

1.2 Before these charters are further elaborated in this lesson, let us first understand what is a
'Demise Charter'.

2.0 DEMISE OR BAREBOAT CHARTER:

2.1 In the Demise or Bareboat Charter the shipowner puts at the disposal of the charterer merely
the ship (hence it is called the bareboat charter) for a specified period of time, in some cases running
into several years.

2.2 The charterer appoints and pays for the Master, officers and crew.

2.3 The charterer provides the cargo and also pays during the charter period all expenses, such
as technical surveys, maintenance, operational and all commercial expenses, except the capital cost
and hull and machinery insurance premiums which the owner incurs.

2.4 The charterer takes over full control of the vessel as if he were the owner (disponent owner).

2.5 The actual registered ownership still remains with the original owner.

2.6 Bareboat chartering is not technically a contract for the carriage of goods by sea. It is a
"lease" of the ship, with an option to sell it to the charterer at an agreed residual value after a period
of time.

2.7 Under this charter the vessel is chartered without any restrictions as to trade limits on cargo
to be carried.

2.8 Any damage to (or claims on the) cargo is to be made good solely by the charterer.

2.9 The shipowner has lien on the cargo for his charter hire.

2.10 Any salvage earned by the vessel belongs to the charterer.

2.11 The owner of the vessel receives a relatively modest hire payment commensurate with his
reduced responsibilities and risks.

2.12 In times when shipbuilding costs are high, shipowners may resort to chartering suitable
tonnage from other owners on a bareboat basis to meet their immediate requirements.

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2.13 Financiers wishing to invest in ships but having no expertise to operate them find this
method suitable.

2.14 Bareboat chartering was not common before 1970s. Hence there were no standard bareboat
C/P contract formats. In 1974 BIMCO published Barecon A and Barecon B, which was later
amalgamated in 1989 as BARECON, 1989.

3.0 NON-DEMISE CHARTER (VOYAGE OR TIME):

3.1 A non-demise charter arises when the shipowner provides the ship and the crew with of
course, the master and the officers, whilst chaterer provides the cargo. A voyage charter and time
charter, which fall in this category, are further elaborated hereunder.

VOYAGE CHARTER TIME CHARTER

Ship is chartered to carry an agreed quantity
of cargo between two ports, say A&B.
Payment (consideration) is called “freight” and
is paid on per tone basis US$/MT or lumpsum.
Full payment is usually made on loading of
cargo or partly on loading and balance on
discharge.
All port charges, canal dues, costs of bunkers,
are borne by the shipowner.
Voyage is conducted as per the shipowner’s
charter’s instructions/orders as per
requirements of the charterer.
Usually time allowed for loading/discharge
called laytime is agreed. If loading/discharging machines, engine/gear break down etc. as
is completed after expiry of laytime
demurrage is payable to the shipowner and if
the same is completed before expiry of
laytime dispatch is payable to the charterer.
Generally Applicable in TRAMP trade
Ship is chartered for a certain period of
time, say, 1 month.
Payment (consideration) is called “hire” and
is paid on ‘per day’ basis, that is, US$/Day.
Payment is made in advance at regular, pre-
determined intervals say, every 15 or 30
days.
All port charges, canal dues, cost etc., of
bunkers, etc. are borne by the charterer.
Charter is conducted as per the charterer’s
instructions/orders. The charterer becomes
a “disponent owner” for the duration of the
charter.
Ship goes “off-hire” for eventualities such as
specified in the C/P. Hire is not payable or
only payable on pro-rata basis for such
periods.
Generally Applicable in LINER trade

4.0 VOYAGE CHARTER :

4.1 The basic practical aspects of the operation of a dry cargo ship which the shipowner or the
ship operator will have to handle in co-ordination with the master, charterer and the agents at the
loading and discharging ports in a voyage charter are narrated hereunder:

 The ship arrives at the loading port or place named in the charter party, or if loading area(s)
or a range of ports are mentioned in the charter party, then to the port as ordered by the
charterer.

 Ship is presented to the charterer or the shipper by giving Notice of Readiness during the
period within which the ship is to be presented ready in all respects to load the cargo as per
the charter party called "Laydays" (or referred to as "Laycan" which is the combined
abbreviated term for the period between commencement and cancelling dates for
presenting the ship representing the laydays).

264
  Notice of Readiness is given immediately on arrival by the master or the shipowner's agents
to the shipper or the charterer or his agent on those days of the week and within the
specified period of the day(s) (e.g. on a week day excluding Sundays and holidays during
office hours) indicating readiness of the ship to load the cargo.

 Notice of Readiness is accepted if/when the ship is found to be ready in all respects on
inspection of the holds immediately by the charterer or the shipper or, if so stipulated in the
charterparty, by an independent surveyor.

 Laytime commences and runs without interruption except as otherwise provided in the
charterparty.

 The ship berths as and when the loading berth is available or if the port is an anchorage port
the ship anchors at the place or buoy allotted by the port.

 Charterer (or shipper) provides the cargo and the loading commences, sometimes even
before the laytime commences, depending on the terms of the charterparty.

 Ship is loaded at the loading berth/s by shore cranes/loading equipment and/or by the ship's
cranes/winches and derricks and, if and when at anchorage, from the small crafts called
barges/lighters which are loaded ashore and brought alongside the ship at the expense of
the shipowner or the charterer as per the terms of the charterparty.

4.2 As the cargo is loaded, Mate's Receipts are signed by the chief officer of the ship every day
for the quantity of the bulk cargo loaded or if it is a bagged cargo for the number of bags with weight
of the cargo loaded.

4.3 The mate also signs the daily working reports prepared by the stevedores in which quantity
of the bulk cargo (or if it is a bagged cargo, the quantity of number of bags with weight of the cargo)
loaded in each shift together with other relevant details such as working time, recess time, Sundays
and holidays, interruptions on account of weather, breakdown of shore cranes or ship's winches or
gears, non-availability of cargo or barges, etc., are recorded.

 Master loads maximum cargo after taking into consideration loadline zones as applicable at
the loading port en route and after providing for the weights of the fuel (bunkers) and water
required for the voyage or upto the intermediate bunkering port, as may have been planned
and also the deadweight already used by stores, spares, provisions, etc., termed as constants
of the ship.

 Loading is completed at the loading port and the holds (cargo compartments) and the
hatches (hold openings) are closed.

 Bill(s) of Lading is (are) prepared by the shipper containing inter alia the quantity of bulk
cargo or the number of bags with the weight of the bagged cargo on the basis of the mate's
receipts and signed by the MASTER or the shipowner's agent on behalf of the master as
authorised by the master and issued on payment of freight (or as and when authorised by
the shipowner) to the shipper.

 Statement of Facts is prepared, recording the relevant facts and timings required to
determine "laytime used for loading" (as agreed and stipulated in the charter party) such as
ship's arrival, berthing, commencement and completion of loading, stoppages/delays during
loading on account of congestion, weather, rain, holidays, lack of cargo, barges, etc. and
signed by the master, shipowner's agent and charterer's agent.
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  Shipowner replenishes en route, if planned that way, bunkers (fuel) at economical prices at
the bunkering port adequate to reach and stay at the discharging port(s) and perhaps to
reach the bunkering port of the next anticipated voyage.

 Master gives notice(s) before arrival at the discharging port, advising ETA (expected time of
arrival) at the discharging port to the charterer and the receiver and applies for free pratique
to the port health authorities and obtains it before or on arrival. The ship's agent enters the
ship with the customs and port authorities and files the ship's manifest showing inter alia the
quantity of cargo to be discharged.

 Ship arrives at the discharging port/place, if named in the charter party or if area(s) or a
range of ports are mentioned, then as ordered by the charterer or the receiver.

4.4 If there is a congestion and a berth or the particular berth meant for discharge is not
available, the ship anchors at the anchorage within the port or at the place where the ship of similar
sizes normally anchor awaiting their turn.

 Notice of readiness is tendered and accepted as and when found valid.

 Ship discharges the cargo at the anchorage(s) into barges, which are discharged ashore
and/or at discharging berth(s) at the expense of the shipowner or the charterer or receiver,
as laid down in the charter party.

 Master or the agent on arrival normally arranges hatch survey to be conducted by an

independent surveyor in order to obtain a certificate that on opening the hatches the cargo
is found in apparent good order and condition.

 Master also records before a notary public the note of protest, if any, in which the master
records the state of bad weather and adverse sea conditions encountered during the voyage
as a measure of protection against potential cargo claims he may receive from the charterer
or the receivers for the cargo damage, if found during discharge.

 The charterer/receiver and/or the port authority in case of bulk cargo maintain the records
of quantity of/or determine the weight of cargo discharged/cleared from the port premises
and in case of bagged cargo maintain tally of the bags discharged and cleared.

 Statement of Facts is prepared (like at loading port/s) and signed by the Master, shipowner's
agents and charterer's agents with protest(s), if any, in case either one disagrees with what
the other party has recorded.

 On the basis of the statement of facts for the loading and the discharging ports, laytime
statements (called Time Sheets) are prepared in order to ascertain the time used for loading
and time used for discharging cargo so as to determine the time saved or lost in loading and
also in discharging in relation to the laytime allowed for loading and discharging as laid down
in the charter party for the purpose of calculating despatch and/or demurrage amounts.

 Freight on the basis of per ton of cargo or lumpsum freight, as the case may be, will have to
be paid as agreed on or after completion of loading and before release of the bill(s) of lading,
in full or a major portion of it (e.g. 90% or 95%) and the balance freight (if any), on or after
completion of discharging, all as agreed, probably after adjustment of the despatch
amount/s, together with the demurrage amount/s, as the case may be.

266
  If the quantity provided loaded by the charterer is less than the stipulated quantity/range,
the shipowner is entitled to freight i.e. deadfreight as it is called, for the quantity short
loaded.

 During the voyage, so far as the direct voyage expenses are concerned, shipowner pays for
the cost of bunkers and water, bunkering port charges, canal dues, etc. Depending on the
type of charter, in most cases, he pays port charges at the loading and discharging ports and
in some cases the cost of loading and/or discharging i.e. stevedoring, also as it is called. The
shipowner incurs the risk of delays during the voyage such as due to bad weather and
adverse sea conditions, as also delays such as waiting for the berths at the loading and
discharging ports congestion and interruption in the loading and discharging due to bad
weather, rain, etc., for which the shipowner may not have been covered by the terms of the
charterparty.

 In the event of disputes regading freight/deadfreight, demurrage payable to the shipowner

and/or despatch payable to the charterers, such disputes are referred to arbitration as laid
down in the charter party.

NOTE:
(1) The case illustrated above is a case of a voyage charter party for loading cargo at one
port and for discharge at one port.

(2) All the communications between the shipowner and the charterer during the charter as
well as after the charter are carried out by the broker(s) through whom the voyage
charter was negotiated and concluded.

4.5 Voyage charters may be for a single voyage or for a round voyage or for consecutive voyages.
There are various types of charters in use, defined on the basis of which charges/expenses are paid
for by the shipowner or by charterer. These are explained below:

5.0 TYPES OF VOYAGE CHARTER:

5.1 F.I.O. (Free In & Out) Charter:

 Charterer pays
 Loading and discharging expenses
 Shipowner pays
 All port expenses

5.2 G.L.F.D. (Gross Load Free Discharge):

 Charterer pays
 Discharging expenses
 Shipowner pays
 Loading expenses & port expenses

5.3 Berth Terms:

 Shipowner pays
 Loading and discharging expenses and port expenses.

(N.B. Time allowed for loading/discharging is not fixed but is as per "the custom of the port".)

267
5.4 Gross Terms:

 Shipowner pays
 Loading/discharging expenses and port expenses.

(N.B. Time allowed for loading and discharging is "definite".)

5.5 Net Terms:

 Charterer pays
 Loading and discharging expenses. Also all port expenses including outward expenses at
the first port and inward expenses at the last port and all port expenses at the interim
ports.

5.6 Lumpsum Charter:

 Charterer pays
 Lumpsum freight.

6.0 TIME CHARTER:

6.1 The practical aspects of the operation of a ship on time charter as between the shipowner,
charterer, master, agents are narrated hereunder, together with the phrases and terms, commonly
used in shipping.

 The ship arrives at the agreed port or place of delivery, after ballasting, if not already at
the port/place of delivery and is delivered by the shipowner to the charterer with
quantities of bunkers as mutually agreed.

 Hire commences to count, from the time and date of delivery and is payable for each
period of time, as agreed, (e.g., 15 days) in advance.

 Bunker survey is carried out by an independent surveyor to determine the quantities of

bunkers remaining on board the ship at the time of delivery and payment for the cost of
bunkers on delivery at the agreed price is made by the charterer with the shipowner.

 On-hire survey is also carried out, if agreed, especially in case of long term charter in
order to ascertain the condition of holds and hatches at the time of delivery, i.e., to note
the then existing damages to the hull, decks, hatches, winches, derricks, etc.

 A delivery certificate is prepared showing the place, time and date of delivery and the
quantities of bunkers, etc., remaining on board the vessel at the time of delivery.

 The charterer then takes over the operation of the ship, placing the ship as per his needs
in the tramp trade or the liner trade or may even sub-charter it to a sub-charterer either
on a voyage charter or time charter. He remains responsible for the performance of the
time charter party to the shipowner at all times.

 The charter may be of a single voyage, called time charter trip (TCT) or for a round
voyage (RV) or for a specific period (called period charter), e.g. 12 months, one month
more or less in which case, charterer may perform as many voyages as he wants within
the maximum range of the time charter period.
268
  During the period of time charter, the charterer has to pay the agreed charter hire in
advance before each due date, failing which the shipowner may exercise the legal right
of withdrawal of the ship from the charter.

 Before the redelivery, the charterer gives notice(s), as agreed, advising the shipowner
the expected date of redelivery on basis of which the shipowner would start working the
ship in the tramp market and fix it for the next employment, so that the ship can
commence the next voyage immediately on redelivery without any loss of time.

7.0 WHO BEARS WHAT EXPENSES ?

7.1 TIME CHARTER:

Shipowner's Account Charterer's Account

Depreciation Hire money
Insurance of vessel (H&M) Bunkers
Interest on capital Port charges
Survey costs (if required) Canal dues
Overheads Load/discharge expenses (stevedoring)
Running costs (pertaining to vessel) Water for boilers and ballast
Crew salary and victualling (feeding) Some cargo claims.
Water for domestic use Insurance of cargo & bunkers.
Brokerage
Some cargo claims
Repairs and maintenance

7.2 VOYAGE CHARTER:

Shipowner's Account Charterer's Account

ALL THE ABOVE +
Loading/discharging costs depending on the
terms of C/P. (FIO – charterer pays
loading/discharge expenses. GLFD – owner
pays loading charges and charterer pays
discharge expenses. GROSS TERMS –
Charterer pays for both loading and
discharge).
Bunkers
Port charges
Canal dues
Water (all purposes)
Despatch if applicable.
Freight + Demurrage if applicable.
Loading/discharging costs depending on
terms in C/P. (Under NETT TERMS –
Charterers pay for all loading/discharging
and port charges including outward
expense at first port and inward expenses
at last port).
Some cargo claims.

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7.3 HOW TO CHARTER ?

TYPE BAREBOAT TIME VOYAGE

1. PERIOD Usually long. Long-medium-trip. One (or more)
voyage(s).
2. HOW PAID? USD/Day USD/Day USD/ton or
lumpsum
3. INFORMATION ON Considerable ship Ship details. Laytime.
SHIP details Start and finish
bunker
consumption
Exclusions
4. PROBLEMS Charterers Charterers Shipowners
5. FORMS Specific Standard but Standard but
clauses negotiable. clauses negotiable.
6. WHEN TO USE? Often financing Shipowners prefer Shipowners prefer
to use this type of to use on a rising
charter before market
market turn down.
7. COSTS Owner pays capital Owner pays capital Owner pays capital
cost and charters pays cost and daily cost and daily
daily running cost plus running cost and running cost and
voyage cost. charterer pays voyage cost and
voyage cost and charterer pays
hire. loading/discharge
cost plus freight.

8.0 SOME ELEMENTARY DIFFERENCES BETWEEN A CHARTERPARTY AND THE BILL OF LADING:

CHARTERPARTY BILL OF LADING

It is a contract by itself. It is an evidence of contract, but not the
contract itself.
Non-negotiable. Quasi-negotiable.
Contract between 2 or more parties for the Contract between 2 or more parties for the
SHIP CARGO
Signed by both charterer and shipowner or by Signed by only the Master (or his agent).
the respective brokers on their behalf.
Used for bulk cargoes usually in full ship loads. Used for small packages, pallets, containers,
etc. in general cargo vessels.
Numerous C/P forms depending on types and Normally standard formats of Bs/L are in
trades are employed. vogue.
The document extends into several pages. Usually two sides of a single page.

ooooo

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 SELF-EXAMINATION QUESTIONS

1. What are the two main types of non-demise C/Ps? How do they differ from each other?
2. What are the important characteristics of bareboat-cum-demise charter? How does
bareboat charter differ from other forms of charters?
3. Name the different types of voyage charters. How does a voyage charter on "gross terms"
differ from a voyage charter on "nett terms".
4. Match items in "A" with those in "B"
A B
(a) All port expenses (i) Charterer pays under GLFD
(b) Discharging expenses (ii) Charterer under FIO
(c) Loading expenses & port expenses (iii) Shipowner under GLFD
(d) Loading & discharging expenses (iv) Shipowner under FIO
5. State what expenses does the shipowner and the charterer bear under a time charterparty?
6. Expand and explain the terms: NOR, SOF, M/R and ETA.
(Also refer to the lesson on "Basic shipping Terminology")
7. Say true or false. If false, give the correct answers:
(a) FONASBA is the publisher of BARECON, 1989.
(b) Time charter is basically a "lease" of the ship.
(c) Under bareboat charter the shipowner has no lien on cargo for payment of his charter.
(d) In voyage and bareboat charter consideration is called hire.
(e) Demurrage and despatch usually apply only to voyage charters.
(f) A single voyage under a time charter is called "time charter trip."

RECOMMENDED FOR FURTHER READING

1. Shipbroking & Chartering Practice -- Gorton, Ihre, Etc., 4th Ed., 1995.
Strongly recommended as a basic text-book for chartering and shipbroking.

See Chapter 7, Pages 78-97 on "Charter Forms."

2. Carriage of Goods by Sea & Multimodal Transport -- Dr.(Mrs) Nilima Chandiramani, 1st Ed.,
1997.
Chapter 1, Pages 3-10 deals with charterparties in a simple and lucid manner and gives a large
number of relevant case law.

3. Bes' Chartering & Shipping Terms -- N. J. Lopez, 11th Ed., 1992.

This is a classic information book for the entire shipping industry. In its eleven chapters it cover
all aspects of shipping in great detail.

Refer to Page 38 for COA, Page 40 for CVs, Page 152 for Time Charter.
Page 157 for Trip Charter, Page 158 for Voyage Charter, etc.

4. Shipping Practice -- Stevens & Butter field

5. Sea Transport -- Alderton

6. Elements of Shipping -- A. E. Branch.

**********************

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272
 ANNEX - 4
SHIPPING PRACTICE FIRST YEAR

CLEARING AND FORWARDING OF CARGO

1.0 INTRODUCTION :

1.1 International trade is best described as movement of goods from the seller to the buyer at a price
determined between the two, dependent on the principles of demand and supply.

1.2 One of the most important aspects of international trade is delivery on time. You miss the time, you
miss the market. Thus, delivery i.e. movement of goods acquires great significance.

1.3 The chain of delivery starts from the factory or warehouse of the seller to the port or air-port of
shipment, which is normally called gateway port.

1.4 The second stage is the receipt of goods at the port premises.

1.5 The third stage is where the Customs are involved. An entry has to be filed in accordance with the
Customs Act and other laws in force, the goods to be examined and released for shipment.

1.6 The fourth stage is when, after Customs permission, the goods are loaded on board the vessel and in
turn the Bill of Lading is issued as a title to claim the goods. The journey to the destination starts.

1.7 The fifth stage is when the vessel is berthed at the port of discharge and the goods are unloaded at
port premises.

1.8 The sixth stage is with the Customs at destination port, where an entry has to be filed and duty to
be paid, the goods to be examined and released for delivery.

1.9 The seventh stage is when after the Customs permission the imported goods are allowed to be
moved by port authorities for dispatch to the buyer's factory or warehouse and unloaded there.

2.0 It is thus seen that:

(i) Goods are moved — Factory to Warehouse/Port

(ii) Goods are stored at the Warehouse/Port
(iii) Goods are cleared through Customs
(iv) Goods are loaded at the origin Port
(v) Goods are moved — Port to Port
(vi) Goods are unloaded at the destination Port
(vii) Goods are cleared through the Customs at the destination port/Warehouse
(viii) Goods are moved from the Port/Warehouse to the Buyer's Premises

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2.1 Transport, Port and Customs are thus the links of this movement chain.

2.2 The driving force in this movement is the Freight Forwarder, primarily known as Custom House Agent
or Customs Broker or Clearing Agent, etc., in the domestic field. It is this agency which should have financial
stability, respect in the market, technical knowledge of Customs and other laws and a license to assist the
trade in clearances through Customs.

3.0 When the local Custom House Agent extends is services beyond his country to the
destination country he is also known as a freight forwarder and builds an international link to the
chain of movement of goods, right from the door of the seller to the door of the buyer.

3.1 The present Freight Forwarder plays his role as follows:

3.1.1 On behalf of Consignor:

(i) Selects routes

(ii) Selects carriers
(iii) Collects shipping documents -
(iv) Arranges for packing, marking, etc. if required. Prepares regulatory documents.
(v) Delivers to carriers and collects transport documents, B/L and Airway Bill, Parcel Receipt,
Railway Way Bill, etc.
(vi) Keeps the consignor, and if required consignee, informed
(vii) Assists in preparation of shipping documents for negotiations

3.1.2 On behalf of Consignee:

(i) Receives shipping documents

(ii) Prepares and processes documents through Customs, Port, Octroi authorities,
arranges payment of duty fees, etc.
(iii) Arranges delivery

3.1.3 For both, if required:

(i) Arranges insurance and processes claims

(ii) Offers warehousing
(iii) Offers distribution services
(iv) Offers consolidation services

3.1.4 He also deals with Carriers — by air - sea - road - rail — presents and supplies documents and
goods and collects receipts, acting as a Principal.

3.2 Accepts all the movement liability and

(i) Prepares all documents

(ii) Processes them
(iii) Issues his own receipt for negotiations
(iv) Settles claims with consignor/consignee for the transport loss according to
standard trading conditions of his national association.

4.0 His role with Customs can be well understood if we familiarize with different types of
clearances that he has to handle. They are:

(a) Clearance for home consumption

(b) Warehousing of goods
(c) Clearance from bond
274
 (d) Clearance of ship's stores
(e) Clearance of baggage
(f) Clearance of postal cargo
(g) Clearance of export cargo
(h) Clearance of coastal cargo
(i) Transshipment of cargo

4.1 Each of these clearances has to follow different procedures and methods as per the rules and
regulations prescribed under the Customs Act.

4.2 For these clearances, different types of documents have to be prepared, such as —

(a) Ship's manifest

(b) Commercial documents - like invoice, packing list, insurance certificate, certificate of origin, bill
of lading or airway bill, import or export licences, etc.
(c) Bill of entry for imports
(d) Shipping bill for exports
(e) Transshipment permit
(f) Bagging forms
(g) Bill of import etc.

4.3 Each of these documents relates to the relevant clearances desired and have to be filed and
processed through Customs.

5.0 The goods for export or import arrive at the gateway port and at the destination port. Port thus
plays a very important role. It is the port which is responsible to Customs for accounting the receipt, delivery
and balance of goods imported or exported. Such a responsibility is cast upon the port by virtue of it being
an "appointed person" under the Customs Act. It is directly responsible and accountable to Customs
for all goods received within its premises. Thus, virtually goods remain under Customs control.

5.1 To be able to execute efficiently, the Port Organization has its own laws, rules and regulations to be
followed if the goods have to be exported or imported through that port.

5.2 Since the Port is accountable to Customs, it has to control the movement of goods within its
premises and hence, even Customs would not be in a position to move a package without Port's permission.
The trade naturally has to pass through a series of Port procedures and requirements before delivery or
shipment is made.

6.0 For examination of goods by Customs, first Port permission is required.

6.1 For delivery of goods:

(a) Port charges have to be paid on import application or export application.

(b) Permission in the form of "Passing" and "Gate Pass" have to be obtained.

6.2 For taking out of the Port area (Customs Area), checking by Gate Inspector of Port and his approval
is necessary.

6.3 Port has its own rules for discharge and storage of cargo. It also decides how dangerous goods are
to be unloaded in stream, on wharf, quay, etc; how heavy lifts are to be handled, etc.

6.4 Normally the goods landed in the Port premises are examined by Customs in the Port itself for
containerized goods, random inspection is carried out.

275
6.5 Goods are examined in accordance with the orders given by assessing officers of Customs while
completing the entries presented. If no discrepancy is noticed, the examining officer signs the "Out
of charge" or permits shipment of goods, and through the Port authorities the local deliveries are taken
or goods are shipped on board vessel.

6.6 The accounting of goods by Port authorities is done through the medium of manifest filed by
the carriers and the entries filed by the agents both for imports and exports.

6.7 A final tally with the Customs entry and the delivery particulars is done with the manifest and
an "Out-turn” report is drawn. This report along with the entry copies is then submitted to Customs
at the Manifest Clearance Department and that completes the job.

6.8 However, for the goods still not cleared, Port on behalf of Customs is authorized to auction
the goods both under the Customs Act, 1962, SECTION 48. Procedure in case of goods not cleared,
warehoused, or transshipped within thirty days after unloading and the Major Port Trusts Act, 1963.
For more information on the Customs rules and regulations visit
http://www.cbec.gov.in/customs/cs-act/cs-act-idx.htm

6.9 Presently, instead of break bulk (i.e. in packages or bundles) the goods are moved in
containers. In many cases the container is considered a package and this creates a problem when
the inner contents are found short.

7.0 The movement of containers is as follows:

(a) CY/CY— from container yard to container yard, or

(b) Port/Port — from shipment port to discharge port, or
(c) CY/CFS-- container yard to container freight station, or
(d) Portto ICD (Inland Container Depot)

7.1 In all these cases, the consignee has to bear port related charges, which includes the THC
(Terminal handling charges), Storage of the container in the port (also referred to as Ground Rent)
demurrage and container detention charges if any as levied by the carrier. Nowadays due to the
increase in container traffic, there is NO DOCK STUFFING/DESTUFFING of containers that are allowed.
The containers are moved to an OFF DOCK FACILITY or a container freight station which is in the vicinity
of the port area and the cargo gets stuffed/de-stuffed into/from the container.

7.2 In exports/imports, thus terminal handling charges, detention charges and destuffing charges for
containers are additional to the freight charges paid.

7.3 The Custom House Agent or the Freight Forwarder with his experience of laws, regulations,
rules, procedures and his expertise in the field thus is an asset both to the trade and to the authorities
for quick and cheaper clearances.

7.4 No doubt, his services have to be paid for in accordance with the rates approved by Customs and
the extent of services desired.

oooooo

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 SELF-EXAMINATION QUESTIONS

1. Describe the different stages involved in the delivery of goods.

2. What is the role of a freight forwarder in handling of cargo on behalf of a shipper?
3. How does a freight forwarder help a consignee to clear the goods?
4. What are the different types of clearances a Customs House Agent has to undertake?
5. What are the documents required to clear goods from ports?
6. What is the role played by Customs in clearance of cargoes?
7. Write short notes on
(a) Ship’s manifest.
(b) Importance of the Port authorities in clearance of goods.
(c) Types of container movements.

RECOMMENDED FOR FURTHER READING

1. The Role of the Freight Forwarder - UNCTAD, 1969 Ed.

Part I is intended to indicate to freight forwarders in developing countries the sort of services they might
offer to traders. It also indicates the sort of services the trader might expect to receive from freight
forwarders.
Part II describes some changes taking place in transport techniques that are likely to affect freight
forwarders in developing countries. The book is an excellent introduction to the subject and is written
in a simple language.
2. Elements of Export Practice ~ A.E Branch, 2nd Ed., 1985.
Regarded as a standard work on the subject of export practice, the book is useful for the students
preparing for the examination as well as for a person employed in export/ shipping office.
Chapter 12, Page 249, deals with "Export Documentation". Though based on the British system the
book can give an insight into some of the documents which are common to Indian export procedures.
3. Elements of Shipping - A. E. Branch, 7th Ed., 1996.
Chapter 19 (Pages 432 to 447) deals with "The International Consignment". Section 19.4 (Pages 445
& 446) gives a brief commentary on the salient documents required by a business organization.
4. For more information on the Customs rules and regulations visit the INDEX of Customs act 1962 at
http://www.cbec.gov.in/customs/cs-act/cs-act-idx.htm

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 ANNEX - 5
SHIPPING PRACTICE FIRST YEAR

COASTAL SHIPPING IN INDIA

1.0 The coastal land and waters, together with their offshore projections in the geological shelf
and slope, is a vital focus if national interests are closely related to economic and social well being, the
national defence, and the ongoing growth of industrial strength. It refers to the transportation along
the sea-coast; and is synonymous with domestic shipping or shipping by sea between two points in the
same country. Coast-wise shipping has always been important for a country, as transportation by sea
is much cheaper than other modes of transportation and environmentally safe and friendly.

2.0 The expression Coastal Shipping/Trade has always had a special meaning for shipping circles
and has been reserved for national shipping under Section 407 of the Merchant Shipping Act till the
liberalization policies of the Government came into play in 1991. India is the only large maritime nation,
which, in the last few years has relaxed cabotage laws. The Coastal Trade Reservation Act initially
applicable to Indian hips only has been relaxed to enable foreign ships to carry containers or lash
barges on the coast. The relaxation of the law in 1992 has not attracted foreign vessels to use Indian
coasts. They prefer to use foreign hub ports for container ships.

3.0 The distribution of natural resources in a country and its geographical features determine, to
a large extent, what sort of transport it should have. India having a large coastline and access to sea
on three sides, assumes great importance for coastal transportation as well as a second line of
defence. Further, some of the bulk minerals are available only in the north-eastern region of the
country which require transportation to other parts. Similarly salt has to be transported from the
West to the East. Coastal shipping provides support infrastructure for development of domestic
industry and trade. It also constitutes support service for multi-modal transport services. For reasons
mentioned coastal shipping has always got a fillip and as early as in 1947 the Shipping Policy Committee
laid down some targets for the promotion of coastal shipping. The plans could not be achieved and
the Government from time to time introduced various measure for improvement. For instance:

i) Reservation of coastal traffic for Indian ships (Act of 1952)

ii) Loans for the purchase of necessary shipping requisites
iii) Sail ships built at Hindustan Shipyard at UK paring price
iv) Allotment of Government owned or controlled cargo

4.0 Coastal shipping has not developed over the years on account of the following reasons:

1) Lack of systematic planning and policy on the part of the government for reservation of
coastal shipping.

2) Coastal shipping has been an integral part of the transport system, but no concrete efforts
have been made to co-ordinate it with various forms of transport to maximize the
movement of goods and to relate it, as far as possible, to the requirements of trade and
industry.

3) Stiff competition from a very well established nation-wide railway system.

4) Paucity of foreign exchange resources is a hindrance to the development of coastal

shipping, which requires protection from competition from other modes of transport.

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 5) Lack of port development to match the traffic resulting in high cost of operations as a result
of delays at ports due to congestion, labour disputes, go slow tactics etc.

6) Over the years coal, salt and cement have been the mainstay of coastal shipping. Coal
being carried by the Railways themselves reduces the quantum of movement. However,
the development of thermal power plants along the coastline has helped restore the
movement of coal to some extent. Besides, the freight rates for coal, salt and cement have
been controlled by the government. Recently, in line with liberalization, the same has
been decontrolled.

7) Poor drafts at ports leading to dead-freighting specially at Calcutta, the main coal loading
port.

8) All Customs procedures have to be followed by coastal vessels.

9) Wages of floating staff on coastal vessels vary considerably as compared to overseas

vessels, latter being much higher.

5.0 REMEDIES:

5.1 Government had set up a special Working Group under the Chairmanship of Dr. D.K.
Afzalpurkar, to study the development of coastal shipping Following are some of its recommendations.

i) Coastal shipping should be removed from the preview of the strict day to day control
of Customs Act, 1962 except in cases where there are some of its recommendations:
ii) Documentation for transportation of coastal goods needs to be streamlined to
facilitate and simplify movement by sea.
iii) Infrastructure facilities at major, intermediate and minor ports need to be improved
and establish dedicated facilities developed for coastal shipping to avoid situations
where priority is only given to foreign trade.
iv) Bunkers and lubricants should be made available to coastal ships at international
prices without levy of duty.
v) Realistic manning scales should be developed for coastal ships keeping in view the
nature of the trade. This will make the trade more cost effective. It has also been
suggested that a separate Coastal Shipping Act be enacted for this purpose.
vi) Vessels employed on coastal trade should not be subject to customs duty on imported
spares and stores.
vii) Government should encourage private entrepreneurs to set up facilities for port
development and infrastructure jointly with State and Central Government.

5.2 In line with point (i) above, Government has announced the decision to exempt coastal
shipping from Customs control, the modalities in regard to which are being processed. Further, it may
be stressed that since coastal shipping is an essential component of the country’s infrastructure, be
available for various incentives available to other infrastructure projects from the State and Central
Governments.

5.3 The Pradhan Committee on Coastal Shipping had observed that while the major ports such as
Calcutta, Haldia, Tuticorin, Madras, Cochin, Kandla, etc. would provide the main infrastructure for
handling of the projected coastal traffic, a more systematic and planned effort would have to be made
for greater utilisation available at minor ports. Such utilisation would in turn lead to improvement in
the infrastructure and the handling facilities available at these ports and thus lead to further
generation of coastal traffic, which could be moved by deployment of handy-sized vessels for parcels
of appropriate sizes.

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6. FUTURE TRENDS:

1) It has been reported that many projects in Gujarat are located near sea-ports which will
depend upon coastal ships for movement of material/cargo.

2) RO-RO ships have been introduced in the Gulf of Cambay, transporting lorries loaded with
merchandise. This would also result in saving of fuel.

3) With decontrolling of freight rates there has been a spurt in the activities of coastal
shipping with a number of small players joining in.

4) A large chunk of the trade is dependant upon the movement of POL from surplus / refining
locations to deficit locations. To achieve economies of scale, special attention is required
here for improving the drafts and the infrastructure.

oooo

SELF-EXAMINATIONS QUESTIONS

1. Discuss the statement: “ India having access to sea on three sides assumes
great importance for coastal transportation.”

2. What are the various problems being faced by coastal shipping in India?

3. In your opinion how can coastal shipping be developed in India more

effectively.

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 ANNEX - 6
SHIPPING PRACTICE FIRST YEAR

CABOTAGE
1.0 The word cabotage derived from the Spanish word cabo which means cape or headland. The
Concise Oxford Dictionary (7th Edition) defines cabotage as "coastal trade; reservation to a country of
(esp. air) traffic operations within its territory. caboter to coast. Spanish cabo " cape."

1.1 Many attempts were made in the past to reserve coastal trade for Indian shipping. The first
attempt was made by the late Honourable Sir Lallu Bhai Samaldas in March 1922 when he moved a
resolution in the Council of States recommending that instructions be issued to the departments
concerned to provide Indian companies opportunities for quoting their rates. Nothing substantial
was done then.

1.2 The second attempt, also unsuccessful, was made by S.N. Haji in 1928, but the government
expressed the view that it was against the interests of those Indians who were living in Burma and
other colonies.

1.3 A third step was taken by Sir Abdul Halim Ghaznavi in 1937 who introduced a bill to control
coastal shipping in India so as to prevent unhealthy competition among the various operating
companies. He even went to the extent introducing the deferred rebate system to be scrapped.
Though this bill was widely supported by the general public, the government felt that it would be
difficult to be executed.

1.4 Finally, in 1945 the Government of India appointed the "Post-War Reconstruction Policy Sub-
Committee on Shipping" under the Chairmanship of Sir C.P. Ramswamy Iyer. This Sub-Committee
recommended, amongst other things, the reservation of coastal trade within the next 5 to 7 years.
This recommendation was accepted by the Government. The policy of entire reservation of coastal
trade was announced in August 1950.

1.5 Coastal trade was finally reserved for Indian shipping, under the Merchant Shipping Act,
1958.

2.0 Presently in India, the Government does not permit any foreign vessel to carry cargoes from
any port on the Indian coast to another Indian port. Under Section 407 of the Merchant Shipping Act,
1958, no foreign ship is allowed to carry cargoes on the Indian Coast.

2.1 In case of foreign ship desires to carry cargo on the Indian coast, it will require to apply to the
Director General of Shipping for a "coastal licence" or a "voyage licence" in order to execute the
coastal portion of the voyage.

2.2 To obtain a "coastal licence" or a "specified voyage licence", the foreign ship owner is
required through his local agents in India to make an application in the prescribed format to the
Director General of Shipping. The steps involved in procuring a licence are as follows:

1. Purchase an "Application Form" by crossed Indian Postal Order (IPO) for Rs. 8 from the
Director General of Shipping, Jahaz Bhavan, Walchand Hirachand Marg, Mumbai 400
038.

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 2. Complete the application form giving details of the vessel to be used, particulars of the
cargo, the dates of commencement of the voyage and submit same to the Directorate
General of Shipping (DGS).

3. DGS will send a copy of the application to the Secretary of the Indian Coastal Conference
ICC), Basement, Scindia House, Ballard Estate, Mumbai 400 038, requesting for his "no-
objection" in granting the licence.

4. The Secretary of the Indian Coastal Conference will write to all the concerned Indian
shipping companies, asking them whether they are in a position to carry out the
movement as envisaged in the foreign company's application.

5. After receiving the replies, the secretary of ICC will inform the DGS. If any Indian
company is in a position to carry out the movement, the licence will not be granted. If no
Indian company is in a position to effect that coastal movement, the licence will be given
for that specified voyage.

3.0 Legally, an Indian ship also needs a licence to operate anywhere, whether on coastal trade or
on international trade. However, once a licence is granted to an Indian ship, it does not hamper it to
operate on the Indian coast.

3.1 Laws relating to cabotage are contained in the Merchant Shipping Act, 1958, under Sections
405 to 414. (See Annexure ).

ooooo

SELF-EXAMINATION QUESTIONS

1. Explain the term "cabotage".

2. What were the major attempts made by Indians, prior to independence, to reserve coastal
trade for Indian Shipping. Were they of any success?
3. What is the situation at present under MSA, 1958?
4. What are the steps required to procure a licence for coastal Shipping by a foreign owner?
5. Under what sections of MSA, 1958, is "cabotage" dealt with?
6. What are different types of licences granted under section 406 of MSA, 1958?
7. When can the D.G. revoke or modify a licence already granted by him?
8. How are rates for coastal Shipping fixed?

RECOMMENDED FOR FURTHER READING

1. The Merchant Shipping Act, 1958 -- J. S. Gill, (March 1999)

2. The Law Relating to Merchant Shipping in India by B .C. Mitra (2000) Pages 161 onwards.
3. The Maritime Law of India (2000) Bhandarkar Publications, Mumbai. Section on Merchant
Shipping Act 1958.
(as amended up to date)

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282
 ANNEXURE

DETAILS OF RELEVANT SECTIONS RELATING TO CABOTAGE

EXTRACTED FROM THE MERCHANT SHIPPING ACT, 1958
CONTROL OF INDIAN SHIPS AND SHIPS ENGAGED IN COASTING TRADE
PART XIV

Sections

405. APPLICATION OF PART

406. INDIAN SHIPS AND CHARTERED SHIPS TO BE LICENCED

407. LICENCING OF SHIPS FOR COASTING TRADE

408. REVOCATION OR MODIFICATION OF LICENCE

409. LICENCES TO BE SURRENDERED WHEN THEY CEASE TO BE VALID

410. NO PORT CLEARANCE UNTIL LICENCE IS PRODUCED

411. POWER TO GIVE DIRECTIONS

412. POWER TO FIX SHIPPING RATES

413. POWER OF DIRECTOR GENERAL TO CALL FOR INFORMATION

414. POWER TO MAKE RULES

4.0 CONTROL OF INDIAN SHIPS AND SHIPS ENGAGED IN COASTING TRADE

405. This Part applies only to sea-going ships fitted with mechanical means of propulsion of not less
than one hundred and fifty tons gross; but the Central Government may, by notification in the
Official Gazatte, fix any lower tonnage for the purposes of this Part.

406. (1) Under this section no Indian ship and no other ship chartered by a citizen of India or a
company or a co-operative society shall be taken to sea from a port or place within or outside
India except under a licence granted by the Director General of shipping.

(2) A licence granted under this section may be –

(a) A general licence;

(b) A licence for the whole or any part of the coasting trade of India; or
(c) A licence for a specified period or voyage.

(3) A licence granted under this section shall be in such form and shall be valid for such Period
shall be subject to such conditions as may be prescribed or specified by the Director General of
Shipping.

283
407. (1) No ship other than an Indian ship or a ship chartered by a citizen of India or a company or a
co-operative society which has satisfied the requirements specified in clause (b) or, as the case
may be, clause (c) of section 21 shall engage in the coasting trade of India except under a
licence granted by the Director General of Shipping under this section.

(2) A licence granted under this section may be for a specified period or voyage and shall be
subject to such conditions as may be specified by the Director General of Shipping.

(3) The Central Government may, by a general or special order, direct that the provisions of
sub-section (1) shall not apply in respect of any part of the coasting trade of India or shall apply
subject to such conditions and restrictions as may be specified in the order.

408. (1) The Director General of Shipping may, at any time, if the circumstances of the case so
require, revoke or modify a licence granted under section 406 or section. 407.

(2) No licence shall be revoked or modified under this section, unless the person concerned
has been given a reasonable opportunity of making a representation against such reservation
or modification, as the case may be.

409. When a licence under section 406 or section 407 ceases to be valid, the person to whom it was
granted shall, without unreasonable delay, return it to the Director General of Shipping.

410. No Customs Collector shall grant a port clearance to a ship in respect of which a licence is
required under this Part until production by owners, master or agent of such a licence.

411. The Director General of Shipping, if he is satisfied that in the public interest or in the interests
of Indian Shipping, it is necessary to do so, give, by an order in writing: such directions as he
thinks fit.

(a) In the case of a ship which has been granted a licence under section 406, with respect to all
or any of the following matters:-

(i) The ports or places, whether within or outside India, to which, and the routes by
which, the ship shall proceed for any particular purpose.
(ii) The diversion of any ship from one route to another for any particular purpose.
(iii) The class of passengers or cargo which may be carried in the ship.
(iv) The order of priority in which passengers or cargo may be taken on or put off the
ship at any port or place, whether within or outside India.

(b) In the case of a ship which has been granted a licence under section 407 with respect to
the order of priority in which passengers or cargo may be taken on the ship at any port or
place in India from which she is about to proceed for any port or place on the continent of
India at which she is to call in the course of her voyage.

411A. (1) If it appears to the Central Government –

(a) That measures have been taken by or under the law of any foreign country for regulating
or controlling the terms or conditions upon which goods or passengers may be carried by
sea, or the terms or conditions of contracts or arrangements relating to such carriage;
and

284
 (b) That such measures, in so far as they apply to things done or to be done outside the
territorial jurisdiction of that country by persons carrying on lawful business in India,
constitute an infringement of the jurisdiction which belongs to India,

It may, by an order in writing, direct that this section shall apply to those measures either
in whole or to such extent as may be specified in the order.

(2) Where an order issued under sub-section (1) is in force in relation to any measures, it shall
be the duty of every person in India who carries on business consisting or comprising of the
carriage of goods or passengers by sea to give notice to the Central Government of any
requirement or prohibition imposed or threatened to be imposed on him pursuant to such
measures so far as this section applied to him, including any requirement to submit any
contract or other document for approval thereunder.

(3) Where a notice under sub-section (2) is received from any person or there are grounds to
believe that a notice is likely to be received, the Central Government may, by an order in
writing, give to such person, directions prohibiting compliance with any such requirement or
prohibition as it considers proper for maintaining the jurisdiction of India.

(4) Any directions given by the Central Government under sub-section (3) may be either
general or special and may prohibit compliance with any requirement or prohibit either
absolutely or in such cases or subject to such conditions, as to consent or otherwise, as may be
specified in the order.

(5) It appears to the Central Government that any person in India has been or may be
required to produce or furnish to any Court, Tribunal or Authority of a foreign country any
commercial document which is not within the territorial jurisdiction of that country or any
commercial information to be completed from the documents not within the territorial
jurisdiction of that country and that the requirement constitutes or would constitute an
infringement of the jurisdiction of that country or that the requirement constitutes or would
constitute an infringement of the jurisdiction which belongs to India, prohibit him from
complying with the requirement except to such extent or subject to such conditions as may be
specified in the order.

412. (1) The Central Government may, by an order published in the Official Gazette, fix
in the prescribed manner the rates at which any Indian ship may be hired and the rates which
may be charged for the carriage of passengers or cargo by any ship engaged in the coasting
trade of India.

(2) If the Central Government considers that with a view to enabling it to fix the rates under
sub-section (1) it is necessary or expedient to do so, it may constitute a Board in the prescribed
manner for the purpose of advising it; and such Board may be constituted either generally or
for a particular case or route or in respect of rates for the carriage of passengers or cargo or
both.

(3) Where an order fixing the rates to be charged for hire or for the carriage of passengers or
cargo has been published under sub-section (1), no owner, master or agent of a ship shall
charge rates exceeding the rates so fixed.

285
413. The Director General of Shipping may, by notice, require-

(a) The owner, master or agent of any ship in respect of which a licence granted by the
Director General of Shipping under this Act is in force; or

(b)The owner, master or agent of any ship in respect of which any directions have been or
may be given under clause (b) of section 411 to furnish within the period specified in the notice
information as to --

(i) The classes of passengers and cargo which the ship is about to carry or is capable
of carrying or has carried during any specified period.
(ii) The rates of passenger fares and freight charges applicable to the ship.
(iii) Any other matter which may be prescribed.

414. (1) The Central Government may make rules for complying the purposes of this
part-

(2) In particular, and without prejudice to the generality of the fore-going power, such rules
may provide for all or any of the following matters, namely:-

(a) The form in which, the period or voyage for which, and the conditions subject to
which licences under this part may be granted, the particulars to be included therein
and the fees payable therefor.

(b) The manner in which rates shall be fixed under section 412.

(c) The constitution and functions of a Board constituted under section 412 and the
procedure to be followed by it in the discharge of its functions.

(d) The matters regarding which information may be required to be furnished under
section 413.

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286
 ANNEX - 7
SHIPPING PRACTICE FIRST YEAR

STATUTORY DOCUMENTS ON BOARD

1.0 Various documents such as certificates, books, conventions & codes and guides are required
to be kept on board a ship. The objectives of maintaining these documents are following:

1) As evidence of compliance with the statutory requirements e.g. certificate under SOLAS,
MARPOL, etc.

2) Easy accessibility of information to the personnel onboard e.g. information about a

dangerous cargo from the IMDG Code.

3) Availability of standard procedures e.g. precautions while handling oil cargoes or grain
cargo etc.

4) An evidence of happenings onboard e.g. log books etc.

1.1 The requirements of different ship types and flags of registry could be different depending on
the conventions, which are applicable. Further certain documents may have to be maintained onboard
as per some other requirements.

1.2 A list of majority of documents required is appended bellow:

2.0 CERTIFICATES:

1) Cargo Ship Safety Construction Certificate - for all ships except passenger ships
2) Passenger Ship Safety Certificate – for passenger ships
3) Cargo Ship Safety Equipment Certificate – for all ships except passenger ships
4) Cargo Ship Safety Radio Certificate
5) Safety Management Certificate – for oil/gas/chemical carriers, bulk carriers, passenger
ships and high speed crafts (other cargo ships after 01.07.2002 only)
6) Document of Compliance - for oil/gas/chemical carriers, bulk carriers, passenger ships
and high speed crafts (other cargo ships after 01.07.2002 only)
7) Document of Compliance - for IMDG cargo carriage on container ships
8) Certificate for the Carriage of Grain – for bulk carriers and general cargo ships
9) Certificate of Approval for Fire Fighting Appliances – for all ships
10) Certificate of Approval for Life-Saving Appliances – for all ships
11) Certificate of Approval for Navigational Aids – for all ships
12) Certificate of Approval for Navigational Lights – for all ships
13) Unattended Machinery Spaces Document – for automatic ships
14) International Oil Pollution Prevention (IOPP) Certificate – for all ships
15) International Air Pollution Prevention (IAPP) Certificate – for all ships
16) Engine International Air Pollution Prevention Certificate (EIAP)
17) International Energy Efficiency Certificate (IEEC)
18) International Sewage Pollution Prevention Cert.(ISPP)
19) Certificate of Inspection of Crew Accommodation (CICA)

287
 20) International Pollution Prevention Certificate for the carriage of Noxious Liquid
Substances in Bulk – for chemical tankers & product tankers carrying chemicals
21) Certificate of Fitness for the Carriage of Dangerous Chemicals in Bulk - for chemical
carriers
22) International Certificate of Fitness for the Carriage of Liquefied Gases in Bulk – for gas
carriers
23) International Load Line Certificate – for all ships
24) International tonnage measurement Certificate – for all ships
25) Minimum Safe Manning Document
26) Certificate of Master, Officers and Ratings – for all ships
27) Certificate of Registry
28) Deratting Certificate – for all ships
29) Cargo Gear Certificates – for all ships
30) Certificate of Compliance (as required by ILO) – for all ships
31) Certificate of Insurance or Other Financial Security in Respect of Civil Liability for Oil
32) Suez Canal Tonnage Certificate – for all ships
33) Certificate of Class – for all ships
34) GMDSS Certificate (effective from 01.02.1999) Replacing the Cargo ship Radio certificate
where applicable.
35) Certificate of Entry - P & I club
36) International Ship Security certificate (ISPS)
37) Continuous Synopsis record (CSR)
38) Any other mandatory requirement of the Flag Administration

3.0 MANUALS BOOKS & RECORD BOOKS:

1) Deck log book – for all ships

2) Loading and intact stability information booklet – for all ships
3) 3.Damage control plans and booklets – for all ships
4) Maneuvering booklet and information – for all ships
5) Fire control plans – for all ships
6) Instruction manual for inert gas system – for oil/chemical/gas carriers
7) Muster lists - for all ships
8) Life saving appliance training manual – for all ships
9) Radio log book – for all ships
10) Nautical publications – for all ships
11) International Code of Signals – for all ships
12) Grains loading stability booklet – for bulk carriers and general cargo ships
13) Dangerous goods manifest or storage plan – for container/RORO/ general cargo ships
14) Crude oil washing operation and equipment manual – for oil tankers
15) Dedicated clean ballast tank operational manual – for oil tankers
16) Operational manual for oil discharge monitoring and control system – for oil tankers
17) Oil Record Book, Part I Machinery Space operation – for all ships
18) Oil Record Book, Part II Cargo/ballast operation – for oil tankers
19) Shipboard oil pollution emergency plan – for and chemical tankers
20) Cargo record book – for oil and chemical tankers
21) Cargo security manuals – for all ships
22) Safety Management Manual – for ships where ISM Code is applicable

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3.0 CODES:

1) Bulk Chemical Code (BCH) – for chemical tankers

2) International Gas Carrier Code (IGC) – for gas carriers
3) International Bulk Chemical Code (IBC) – for chemical tankers
4) Code of Safe Practice for Solid Bulk Cargoes – for bulk carriers and general cargo ships
5) Code for Safe Practice for Cargo Stowage and Securing – for container/RORO/ general
cargo
6) ships
7) Code of Safe Practice for Ships carrying Timber Deck Cargoes – for timber carriers
8) Guide to helicopter/ship operations – for all ships
9) Ship to ship transfer guide (petroleum) – for oil tankers
10) Ship to ship transfer guide (liquefied gases) – for gas carriers
11) International Maritime Dangerous Goods (IMDG) Code – for container /RORO/ general
12) cargo ships
13) International Safety Guide for Oil Tankers & Terminals (ISGOTT) Guide – for oil tankers
14) Guidelines for the development of Shipboard Oil Pollution Emergency Plan – for all
ships
15) Manual on Oil Pollution – for all ships
16) Clean seas guide for oil tankers – Retention of residues onboard – for oil tankers

4.0 Below are the details in brief regarding the certificates and for the reasons they have to be
on board:

 International Tonnage Certificate (1969): An International Tonnage Certificate (1969) shall be

issued to every ship, the gross and net tonnage of which have been determined in accordance
with the Convention.

 International Load Line Certificate: An International Load Line Certificate shall be issued
under the provisions of the International Convention on Load Lines, 1966, to every ship which
has been surveyed and marked in accordance with the Convention or the Convention as
modified by the 1988 LL Protocol, as appropriate.

 Minimum safe manning document: Every ship to which chapter I of the Convention applies
shall be provided with an appropriate safe manning document or equivalent issued by the
Administration as evidence of the minimum safe manning.

 Fire safety training manual: A training manual shall be written in the working language of the
ship and shall be provided in each crew mess room and recreation room or in each crew cabin.
The manual shall contain the instructions and information required in regulation II-
2/15.2.3.4. Part of such information may be provided in the form of audio-visual aids in lieu
of the manual.

 Training manual: The training manual, which may comprise several volumes, shall contain
instructions and information, in easily understood terms illustrated wherever possible, on the
life-saving appliances provided in the ship and on the best methods of survival. Any part of
such information may be provided in the form of audio-visual aids in lieu of the manual.

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 International Code of Signals and a copy of Volume III of IAMSAR Manual: All ships required
to carry a radio installation shall carry the International Code of Signal; all ships shall carry an
up-to-date copy of Volume III of the International Aeronautical and Maritime Search and
Rescue (IAMSAR) Manual.

 Certificates for masters, officers or ratings: Certificates for masters, officers or ratings shall
be issued to those candidates who, to the satisfaction of the Administration, meet the
requirements for service, age, medical fitness, training, qualifications and examinations in
accordance with the provisions of the STCW Code annexed to the International Convention
on Standards of Training, Certification and Watchkeeping for Seafarers, 1978. Formats of
certificates are given in section A-I/2 of the STCW Code. Certificates must be kept available in
their original form on board the ships on which the holder is serving.

 International Oil Pollution Prevention Certificate: An international Oil Pollution Prevention

Certificate shall be issued, after survey in accordance with regulation 6 of Annex I of MARPOL,
to any oil tanker of 150 gross tonnage and above and any other ship of 400 gross tonnage and
above which is engaged in voyages to ports or offshore terminals under the jurisdiction of
other Parties to MARPOL. The certificate is supplemented with a Record of Construction and
Equipment for Ships other than Oil Tankers (Form A) or a Record of Construction and
Equipment for Oil Tankers (Form B), as appropriate.

 Shipboard Oil Pollution Emergency Plan (SOPEP): Every oil tanker of 150 gross tonnage and
above and every ship other than an oil tanker of 400 gross tonnage and above shall carry on
board a Shipboard Oil Pollution Emergency Plan approved by the Administration.

 International Sewage Pollution Prevention Certificate: An International Sewage Pollution

Prevention Certificate shall be issued, after an initial or renewal survey in accordance with the
provisions of regulation 4 of Annex IV of MARPOL, to any ship which is required to comply
with the provisions of that Annex and is engaged in voyages to ports or offshore terminals
under the jurisdiction of other Parties to the Convention.

 Garbage Record Book: Every ship of 400 gross tonnage and above and every ship which is
certified to carry 15 persons or more engaged in voyages to ports or offshore terminals under
the jurisdiction of other Parties to the Convention and every fixed and floating platform
engaged in exploration and exploitation of the seabed shall be provided with a Garbage
Record Book.

 Garbage Management Plan: Every ship of 100 gross tonnage and above and every ship which
is certified to carry 15 persons or more shall carry a garbage management plan which the crew
shall follow.

 Document of Compliance: A document of compliance shall be issued to every company which

complies with the requirements of the ISM Code. A copy of the document shall be kept on
board.

 Safety Management Certificate: A Safety Management Certificate shall be issued to every

ship by the Administration or an organization recognized by the Administration. The
Administration or an organization recognized by it shall, before issuing the Safety
Management Certificate, verify that the company and its shipboard management operate in
accordance with the approved safety management system.

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 Cargo Securing Manual: All cargoes other than solid and liquid bulk cargoes, cargo units and
cargo transport units, shall be loaded, stowed and secured throughout the voyage in
accordance with the Cargo Securing Manual approved by the Administration. In ships with ro-
ro spaces, as defined in regulation II-2/3.41, all securing of such cargoes, cargo units and cargo
transport units, in accordance with the Cargo Securing Manual, shall be completed before the
ship leaves the berth. The Cargo Securing Manual is required on all types of ships engaged in
the carriage of all cargoes other than solid and liquid bulk cargoes, which shall be drawn up to
a standard at least equivalent to the guidelines developed by the Organization.

 International Ship Security Certificate (ISSC): An International Ship Security Certificate (ISSC)
shall be issued to every ship by the Administration or an organization recognized by it to verify
that the ship complies with the maritime security provisions of SOLAS chapter XI-2 and part A
of the ISPS Code. An interim ISSC may be issued under the ISPS Code, part A, section 19.4.

 Ship Security Plan and associated records: Each ship shall carry on board a ship security plan
approved by the Administration. The plan shall make provisions for the three security levels
as defined in part A of the ISPS Code. Records of the following activities addressed in the ship
security plan shall be kept on board for at least the minimum period specified by the
Administration:
1. training, drills and exercises;
2. security threats and security incidents;
3. breaches of security;
4. changes in security level;
5. communications relating to the direct security of the ship such as specific
threats to the ship or to port facilities the ship is, or has been, in;
6. internal audits and reviews of security activities;
7. periodic review of the ship security assessment;
8. periodic review of the ship security plan;
9. implementation of any amendments to the plan; and
10. maintenance, calibration and testing of any security equipment provided on
board, including testing of the ship security alert system.

 Continuous Synopsis Record (CSR): Every ship to which chapter I of the Convention applies
shall be issued with a Continuous Synopsis Record. The Continuous Synopsis Record provides
an onboard record of the history of the ship with respect to the information recorded therein.

 International Air Pollution Prevention Certificate: Ships constructed before the date of entry
into force of the Protocol of 1997 shall be issued with an International Air Pollution Prevention
Certificate. Any ship of 400 gross tonnage and above engaged in voyages to ports or offshore
terminals under the jurisdiction of other Parties and platforms and drilling rigs engaged in
voyages to waters under the sovereignty or jurisdiction of other Parties to the Protocol of
1997 shall be issued with an International Air Pollution Prevention Certificate.

 International Energy Efficiency Certificate: An International Energy Efficiency Certificate for

the ship shall be issued after a survey in accordance with the provisions of regulation 5.4 to
any ships of 400 gross tonnage and above before that ship may engage in voyages to ports or
offshore terminals under the jurisdiction of other Parties.

 Fuel Oil Changeover Procedure and Logbook (record of fuel changeover): Those ships using
separate fuel oils to comply with MARPOL Annex VI, regulation 14.3 and entering or leaving
an emission control area shall carry a written procedure showing how the fuel oil changeover

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 is to be done. The volume of low-sulphur fuel oils in each tank as well as the date, time and
position of the ship when any fuel oil changeover operation is completed prior to the entry
into an emission control area or commenced after exit from such an area shall be recorded in
such logbook as prescribed by the Administration.

 Ozone-depleting Substances Record Book: Each ship subject to MARPOL Annex VI, regulation
6.1 that has rechargeable systems that contain ozone-depleting substances shall maintain an
ozone-depleting substances record book.

 Ship Energy Efficiency Management Plan (SEEMP): All ships of 400 gross tonnage and above,
excluding platforms (including FPSOs and FSUs) and drilling rigs, regardless of their propulsion,
shall keep on board a ship specific Ship Energy Efficiency Management Plan (SEEMP). This may
form part of the ship's Safety management System (SMS).

 Passenger Ship Safety Certificate: A certificate called a Passenger Ship Safety Certificate shall
be issued after inspection and survey to a passenger ship which complies with the
requirements of chapters II-1, II-2, III, IV and V and any other relevant requirements of SOLAS
1974. A Record of Equipment for the Passenger Ship Safety Certificate (Form P) shall be
permanently attached.

 Cargo Ship Safety Construction Certificate: A certificate called a Cargo Ship Safety
Construction Certificate shall be issued after survey to a cargo ship of 500 gross tonnage and
over which satisfies the requirements for cargo ships on survey, set out in regulation I/10 of
SOLAS 1974, and complies with the applicable requirements of chapters II-1 and II-2, other
than those relating to fire-extinguishing appliances and fire-control plans.

 Cargo Ship Safety Equipment Certificate: A certificate called a Cargo Ship Safety Equipment
Certificate shall be issued after survey to a cargo ship of 500 gross tonnage and over which
complies with the relevant requirements of chapters II-1 and II-2, III and V and any other
relevant requirements of SOLAS 1974. A Record of Equipment for the Cargo Ship Safety
Equipment Certificate (Form E) shall be permanently attached.

 Cargo Ship Safety Radio Certificate: A certificate called a Cargo Ship Safety Radio Certificate
shall be issued after survey to a cargo ship of 300 gross tonnage and over, fitted with a radio
installation, including those used in life-saving appliances, which complies with the
requirements of chapter IV and any other relevant requirements of SOLAS 1974. A Record of
Equipment for the Cargo Ship Safety Radio Certificate (Form R) shall be permanently attached.

 Cargo Ship Safety Certificate: A certificate called a Cargo Ship Safety Certificate may be issued
after survey to a cargo ship which complies with the relevant requirements of chapters II-1, II-
2, III, IV and V and other relevant requirements of SOLAS 1974 as modified by the 1988 SOLAS
Protocol, as an alternative to the Cargo Ship Safety Construction Certificate, Cargo Ship Safety
Equipment Certificate and Cargo Ship Safety Radio Certificate. A Record of Equipment for the
Cargo Ship Safety Certificate (Form C) shall be permanently attached.

 Certificate of Fitness for the Carriage of Dangerous Chemicals in Bulk: A certificate called a
Certificate of Fitness for the Carriage of Dangerous Chemicals in Bulk, the model form of which
is set out in the appendix to the Bulk Chemical Code, should be issued after an initial or
periodical survey to a chemical tanker engaged in international voyages which complies with
the relevant requirements of the Code.

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  Certificate of Fitness for the Carriage of Liquefied Gases in Bulk: A certificate called a
Certificate of Fitness for the Carriage of Liquefied Gases in Bulk, the model form of which is
set out in the appendix to the Gas Carrier Code, should be issued after an initial or periodical
survey to a gas carrier which complies with the relevant requirements of the Code.

 Document of compliance with the special requirements for ships carrying dangerous goods:
The Administration shall provide the ship with an appropriate document as evidence of
compliance of construction and equipment with the requirements of regulation II-2/19 of
SOLAS 1974. Certification for dangerous goods, except solid dangerous goods in bulk, is not
required for those cargoes specified as class 6.2 and 7 and dangerous goods in limited
quantities.

 International Certificate of Fitness for the Carriage of INF Cargo A ship carrying INF cargo
shall comply with the requirements of the International Code for the Safe Carriage of
Packaged Irradiated Nuclear Fuel, Plutonium and High-Level Radioactive Wastes on Board
Ships (INF Code) in addition to any other applicable requirements of the SOLAS regulations
and shall be surveyed and be provided with the International Certificate of Fitness for the
Carriage of INF Cargo

ooooo

SELF –EXAMINATION QUESTIONS

1) Why certain documents are to be maintained on board a ship?

2) Name FIVE certificates that must be on all ships.
3) Briefly describe the following Certificates:
(a) Certificate of Class
(b) Cargo Ship Safety Construction Certificate
(c) Certificate of Registry
(d) Safety Management Certificate
(e) Document of Compliance (ISM code)
(f) International Oil pollution prevention certificate
(g) International Load Line Certificate
(h) Minimum Safe Manning Certificate

For the entire List of documents and list of certificates that is required on board the vessel and on
what types of vessel and its sizes, visit the following link for more information.

http://www.gl-group.com/pdf/list_of_certificates.pdf

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 ANNEX - 8

SHIPPING PRACTICE FIRST YEAR

CONTAINERISATION

1.0 DEFINITIONS:

1.1 Container is a large size metal or wooden box used to store and carry goods. In shipping, the
term was used to refer to any type of box used for carrying cargo. A container is also known as “box”
or “van” in many countries, particularly in the USA.

1.2 The International Organization for Standardisation (ISO) defines a freight container as an
article of transport equipment -

(i) Of a permanent character and strong enough to be suitable for repeated use.

(ii) Specially designed to facilitate the carriage of goods by one or more modes of
transport.

(iii) Fitted with devices to permit ready handling and easy transfer from one mode of
transport to another.

(iv) So designed as to be easy to stuff and dyestuff.

A general purpose freight or shipping container is therefore a container of rectangular shape,

weatherproof, for transporting and storing a number of unit loads, packages or bulk material. It
confines and protects the contents from loss or damage. It can be separated from the means of
transpor , handled as a unit load and transshipped without rehanlding the contents.

___________________

NOTE: While reading this lesson, also refer to the following material:

(1) Lessons 8 entitled “Containerisation in India” in Current Shipping Environment .

(2) Study material in Shipping Practice – Lesson 15 on “abbreviations”; Lesson 16 on “Basic

Shipping Terminology”; Annex-1 on “Specialized Vessels” and Lesson 10 on “Cargo Handling
Equipment”.

(3) Chapter 20 on “Containerisation” in the prescribed text- book on Shipping Practice by

Stevens & Butterfield.

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2.0 CLASSIFICATION:

2.1 BY CONSTRUCTION :A container can be classified in terms of its building material, i.e., it is
defined by what it is made of. The maximum number of containers are made of steel,
aluminum or GRP (glass fibre reinforced plywood). Almost 65% of the entire container fleet
presently consists of steel containers.

2.1.1 The advantages of Containers are:

(i) They are the cheapest, having corrugated sides, ends and roof to give it structural
strength.

(ii) They can be more easily repaired compared to aluminum or GRP containers in view
of availability of skilled labour and equipments to handle steel. (In the USA aluminum
containers can be more easily repaired compared to steel containers, because it is a major
exporter of aluminum).

(iii) They can resist damage. While damage can create a hole in an aluminum container, it
can only cause a dent in a steel container which may not warrant an immediate repair.

(iv) Better weather tightness.

(v) Preferred by developing countries due to rough handling.

2.1.2 The Disadvantages of Steel Containers are:

(i) They have an economic life of about 10 years, while aluminum or GRP containers last
longer.

(ii) They have more tare weight compared to other types of containers. Thus they carry
less payload of cargo.

(iii) They are prone to corrosion. But this can be overcome by use of alloy steel instead of
ordinary steel.

2.1.3 The Advantages of Aluminum Containers are:

(i) Light tare weight i.e. more cargo can be loaded.

(ii) Less prone to corrosion, i.e. of natural oxide coating on surface.

(iii) Flexible. Distorts when stress is applied but reverts to original form when stress is
removed. Suited to cellular vessels.

2.1.4 The Disadvantages of Aluminum Containers are:

(i) Prone to be damaged easily.

(ii) More expensive.

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2.1.5 The Advantages of Plywood Containers are:

(i) Longer internal cubic capacity, due to thinner panel structure.

(ii) Less thermal conductivity. Hence less condensation and less sweat damage to cargo.
(iii) More resistant to corrosion.

2.1.6 The Disadvantages of Plywood containers are:

(i) The tare weight is greater than or equal to steel containers.

(ii) Very expensive owing to higher costs of material and fabrication.

2.2 BY SIZE:

2.2.1 The other mode of classification of containers can be by size or dimensions. Containers are
defined in multiples of 10ft., i.e., 20ft, 30ft or 40ft.

2.2.2 Presently 20ft and 40ft containers are used and around 65-70 percent of the world fleet
consist of 20ft containers. Twenty-foot containers are referred to as “Twenty-Foot Equivalent Units”
or TEUs and 40-footers as “Forty-Foot Equivalent Units” or FEUs.

2.2.3 The TEU measurement is used to quantity the container capacity of a ship and the number of
containers carried in a particular voyage.

2.2.4 Most of the containers have a width of 8ft. But in height containers vary from 8ft to 81/2ft.
Presently about 75% of world box fleet have a height of 81/2ft and about 20% have a height of 8ft.
However, there is an increasing tendency to use containers of 9ft and 91/2ft(called high-cube
containers).

2.2.5 INTERNATIONAL STANDARD ORGANISATION (ISO) CONTAINERS:

ISO has worked on standardization of container dimensions. Below is the table of the dimensions
and particulars of ISO containers:

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2.3 BY USE :

2.3.1 Containers can also be classified by cargo to be stowed therein. There are:

a) General Purpose Cargo Containers are the most representative type for general cargo
(packed cargo) and do not require temperature control. There are also called Dry Cargo
Containers.

They are normally made of steel and are fully enclosed through two full height rear doors.
The floor is covered with timber planks or plywood sheets and cargo is secured to lashing
hooks usually along the sides at floor level.

b) Thermal Containers are designed for cargo requiring refrigerated or insulated storage.
They are covered with material of low heat transfer such as polystyrene foam.

2.3.2 Thermal Containers are further classified into three types:

(a) Refrigerated (or Reefer) Containers usually of aluminum, the inside being covered with a
material of low heat transfer. They are normally lined with plywood required to maintain
a temperature of minus (-) 18º C for carriage of frozen cargo (fish, shrimps, meat, etc) and
a temperature of around 0º C for carriage of fresh fruit and vegetables. The usual
refrigeration in a reefer container is refrigeration by Freon gas using electrical power from
the vessel’s generator or electrical points in a container terminal. It is fitted with
refrigeration unit inside the container itself or with a clip-on generator unit which can be
attached to the container to provide cold air through inlet and outlet holes by means of
auxiliary power.

Loading and discharging is done through the front door as in a normal 20ft. container
Refrigerated containers are very expensive. Almost 20% of containers used in the world
constitute reefer containers.

(b) Insulated Containers for fruit, vegetables, etc. Hence dry ice is used plywood to reduce
the effects of changes in temperature on the as the cooling medium. An insulated
container is normally lined with cargo and to reduce condensation.

The container is suitable for perishable goods (vegetables and fruits) and other cargoes
which require protection from temperature changes without the necessity of
refrigeration. The inside dimensions of an insulated container are less than those of a
general purpose container because of the lining.

These containers can carry general cargo when they are not utilized as insulated
containers.

(d) Ventilated Containers allow for the passage of air by means of apertures (series of holes)
along the top and bottom side rails to provide continuous ventilation. These are used for
cargo such as tea, coffee or cocoa which require ventilation.

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 If tea is carried in a closed box type container, it is liable to “sweat” damage due to
absorption of moisture from the atmosphere inside. Hence ventilated containers are
used for carriage of tea.

Considerable advancement has been made with regard to reefer containers. Controlled
atmosphere and modified atmosphere systems have been introduced.

In the controlled atmosphere system there is computerized controller. The refrigeration

unit maintains the set temperature and the controller maintains the ideal atmosphere by
sending the product’s consumption of oxygen and production of carbon dioxide. By
integrating this information the controller continuously adjusts air exchange valves and
activates the required scrubbing systems to maintain the atmosphere at the pre-set level.

In the modified atmosphere system, the desired atmosphere is created in the container
when it is stuffed. The container is then sealed to prevent in the original atmosphere due
to ventilation. The modified atmosphere system is limited to shorter voyages and is
meant for fewer commodities than controlled atmosphere system.

(d) Special Containers: The third category of container comprises the balance types under
the broad head of “Special Containers”. Prominent under this head are Bulk Containers,
Tank Containers, Open Top Containers, Side Open Containers, Flats, Car Containers,
Pen Containers (to carry livestock), etc.

2.3.3 Use also depends on the nature of the cargo, whether dry bulk, liquid or perishable cargoes.

3.0 CONCEPTS OF FCL & LCL :

3.1 FCL means “Full Container Load”. Here the container consists of cargoes meant for one party,
i.e. consignee only. The cargo is usually stuffed at shipper’s warehouse and is destuffed at consignee’s
warehouse. Here the responsibility of stuffing and stowing of cargo inside the container is that of
shipper. Stuffing charges are on account of the shipper and destuffing charges on account of the
consignee.

3.2 LCL means “Less than Container Load”. Here the container consists of cargoes meant for
different parties. The carrier collects cargoes from various shippers and stuffs all of them into a
container. At destination, the carrier’s agent dyestuffs the cargoes from the container and delivers the
cargo to respective consignees.

4.0 FREIGHTING OF CONTAINERISED CARGOES:

4.1 There are three types of freighting arrangements in containerization. They are

(a) Commodity Box Rate (CBR)

(b) Freight All Kinds (FAK) and
(c) Tariff Rate for Conventional (Break-Bulk) Cargo for Less than Container Load (LCL)
shipments.

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4.2 Commodity Box Rates (CBR) :

4.2.1 This is not very popular nowadays, however depending on the commodity and rather also
depends on weight of the commodity, which determines this. If the commodity is different, freight is
different. The rate is based on the average utilization of the box, e.g., 13 tonnes in a 20ft container.
Various commodities eg: Stones / Gherkins in a 20’DV and YARN / PIPES in a 40’HC has got a
commodity based rate compared to the other FAK rates.

4.2.2 Box rate is also quoted for 40ft containers.

Example: Ex-Bombay to -------------

Items Sizes
20 Ft. 40 Ft.
Food stuffs US$ 760 US$ 1400
Sanitary wares US$ 700 US$ 1300

4.3 Freight All Kinds (FAK):

4.3.1 This is nowadays the most prevalent type of pricing. Here the carrier is not concerned with
the commodities stuffed inside the container. The carrier quotes a fixed amount (e.g. US$1000) per
20ft container to, say, from port A to B, irrespective of what it contains. In current situation all the
lines quote FAK rates for all sectors.

4.3.2 It is basically an average rate arrived at by the carrier dividing his anticipated total costs by the
anticipated number of containers to be moved. Here shippers can take advantage of stuffing such
types and grades of cargoes which give them an advantage of freight. (illegal cargoes are not allowed.)

4.4 Conventional Tariff Rates for Less than Container Load Cargoes (LCL):

4.4.1 Shippers with limited quantities of cargo, not enough to fill an entire 20 container, tender their
consignments to the carrier, who accepts them as they are (in cases, bags, cartons, drums, etc.) and
issues separate Bills of Lading Conventional tariff rate of freight (in US$ for cubic metre/tone) based
on individual commodities is charged.

Items Measurement (per Weight

cubic metre) (per tone)
General Cargo US$ 50 US$ 60
Food stuffs US$ 60 US$ 70

4.4.2 The carrier then consolidates the consignments of various shippers meant for same
destination and stuffs them into a container for shipping. As destination the carrier’s representative
receives the container, dyestuffs it and delivers the consignments to respective consignees against
surrender of house bills of lading duly discharged. The stuffing charges are normally borne by the
carrier.

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5.0 CONTAINER MARKINGS :

5.1 For identification containers have markings showing :

(i) Owner Code, Product Group code, Registration Number and Check Digit.
(ii) Size & Type Code.
(iii) Maximum Gross and Tare Weight
(iv) Payload Weight & Cubic Capacity.

6.0 CONTAINER TERMINAL:

6.1 A Model container terminal may usually be divided into the following areas:

6.1.1 THE SHIPS’ AREA/CONTAINER BERTH:

This comprises a quay line where the container vessels are berthed. Usually the modern
container terminals are provided with gantries, which are heavy cranes, required to handle
containers. The gantry is generally mounted on rails and moves to and fro along the entire
length of the container vessel. The gantry is usually fitted with automatic spreader for faster
handling of containers.

6.1.2 MARSHALLING YARDS:

The rear portion of the ship’s area is known as marshalling yard and is used to pre-stack a
limited number of export containers as buffer stock for loading and also to pre-stack a limited
number of import containers after being discharged from vessels and prior to their removal
to container stacking yard.

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6.1.3 STACKING YARD OR CONTAINER YARD :

This is the area where the import containers are transferred from marshalling yard and stored
until they are taken to Container Freight Station (CFS), Inland Container Depot (ICD),
consignee’s warehouse, etc. Similarly, this is the area where export containers are brought
from ship operator’s warehouse, ICD,CFS, etc. prior to being moved to marshalling
yard/container berth for being loaded on board a vessel. Container Yard is also used for
stacking empties.

7.0 CONTAINER FREIGHT STATION :

 Containers are stuffed and destuffed here.

 One of the important functions of a CFS is to consolidate smaller shipments of LCL
cargo into large units.
 Great help to small shippers.

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  A CFS can minimize transportation costs by exploiting the economy of movement in
FCLs.
 CFS is normally connected to the nearest ICD by roadways. CFS may be near a port.
 In Indian, CONCOR is involved in the development and management of a network of
ICDs/CFSs all over the country.
 Many large shipping companies have their own CFSs.

[Please see Lesson 8 entitled CONTAINERISATION IN INDIA for information on Inland

Container Depots (ICDs) at length in Current Shipping Environment subject]

8.0 TERMINOLOGY:

8.1 International or Multimodal Transport means the carriage of goods by at least two different
modes of transport on the basis of a multimodal transport contract under a single freight from a
place in one country at which the goods are taken in charge by the multimodal transport operator,
to a place designed for delivery situated in a different country.

8.2 Multimodal Transport Operator means any person who on his behalf or through another
person acting on his behalf concludes a multimodal transport contract and who acts as a principal
not as an agent or on behalf of the consignor or of the carriers participating in the multimodal
transport operations and who assumes responsibility for the performance of the contract.

8.3 Multimodal Transport Contract means a contract whereby a multimodal transport operator
undertakes, against payment of freight, to perform or to procure the performance of international
multimodal transport.

8.4 Multimodal Transport Document means a document which evidences a multimodal transport
contract, taking over charge of the goods by the multimodal transport operator and an undertaking
by him to deliver the goods in accordance with the terms of that contract.

8.5 Consignor means any person by whom or by whose name or on whose behalf a multimodal
transport contract has been concluded with the multimodal transport operator, or any person by
whom or in whose name or on whose behalf the goods are actually delivered to the multimodal
transport operator in relation to the multimodal transport contract.

8.6 Consignee means the person entitled to take delivery of the goods.

8.7 Clip-on unit: Generator which can be attached to a refrigerated container to provide auxiliary
power.

8.8 Cellular Containership: This ship is dedicated to the carriage of shipping containers. It is fitted
with cell guides, uprights which provide a framework designed to accommodate standard size
containers in such a way that the containers do not move in any direction. Containers are normally
carried both under deck covered with hatch covers and on deck.

8.9 Cellular Barge: This is a barge which is dedicated to the carriage of shipping containers and
fitted with cell guides similar to those in cellular containerships.

8.10 Container Seal: Security device attached to doors of a shipping container. If the seal is broken
before destination, this is virtual evidence that the container has been broached or opened in transit.

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8.11 Twist Lock: Device which is fitted into each of the four corner fittings of a container which can
be turned or twisted, enabling the container to be locked for securing and lifting.

8.12 Bay-Row-Tier : Co-ordinates within a cellular container ship. A bay is the athwart ship section
of a ship, one container in length. A row is the longitudinal section of the ship, one container wide. A
tier is the vertical section of the ship, one container deep. Thus the position of the container within
the ship is shown as 14.04.10 i.e. Bay 14, Row 4 and Tier 10.

8.13 Slot: Slot is a compartment in the hold of a cellular container ship or on the deck into which
a shipping container fits exactly. It is same as the term “cell”.

8.14 Container Barge: Barge designed or utilized to carriage containers.

8.15 Container Berth : Place alongside a quay containership load and discharge.

9.0 OTHER TYPES OF CONTAINERS:

9.1 High Cube Reefer Containers: It is a variation of the refrigerated container which has a higher
cubic capacity than the standard size reefer container and can carry a larger volume of cargo. The
extra capacity is achieved by increasing the height of the container or by designing it so that the space
taken by the clip-on diesel generator is over and above the normal dimensions of the container.

9.2 Dry Cargo Containers: Dry cargo containers which do not require temperature control are by
far the maximum in use. They are of different types. A standard dry cargo container is a closed
container of box type with doors at one end. There are various “dry specials” like open top containers,
flat racks or flats, bulk containers, garment containers, ventilated containers, etc.

9.2.1 About 50% of containers used in the world are dry cargo containers.

9.3 Side Door Containers : A container whose doors are on one or both sides rather than at the
rear. These containers are used when access to rear doors for loading or discharging is difficult, for
example, when they are carried on railway wagons.

9.4 Collapsible or Folding Flat Rack Containers: Containers consisting of a flat bed and four corner
posts, designed to carry cargoes of awkward size. When these flat racks are empty, the ends are
collapsed and several flat racks can then be one over the other in a stack which has the same
dimensions as a simple standard container making it possible and convenient to transport in the same
way as normal 20’ container.

9.5 Bulk Containers: Bulk container is a container fitted with manholes to facilitate loading of bulk
cargo through gravity.

9.5.1 Designed to carry free flowing bulk cargoes such as cement, sugar, cereals or fertilizers, the
cargo is loaded through hatches in the roof of the container and discharged through hatches in the
door or from front end by tipping the container.

9.5.2 Used for grain, fertilizers, chemicals, etc., in bulk.

9.6 Garment Containers: Garment containers are fitted with hangers to help loading a large
number of garments in hangers inside the container, which would not have been possible otherwise
by packing in cartons or putting in an ordinary dry freight container.

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9.7 Liquid/Tank Containers: Liquid containers are usually made of cylindrical stainless tank and
have manholes for loading and unloading liquid cargo.

9.7.1 The tank is surrounded by a framework of very strong steel which gives it the same overall
dimensions as those of standard dry cargo container enabling it to be handled/carried in the same
way as a normal container.

9.7.2 It is used for liquid cargoes like (i) edible oils (vegetable oils); (ii) liquors (whisky, wine, etc.),
and (iii) chemicals.

9.7.3 It is heavy in weight than a reefer container and is more expensive to contract.

9.7.4 Contents are loaded through a manhole on the top and discharged through an outlet value on
the side.

9.7.5 Gas containers are special containers with fixtures and fittings for filling and emptying liquid
gas. They also have special features like thick walls of special metal for safety during transit.

9.8 High Cube General Purpose Container: A 40-foot container of 9’6” height. It is recommended
for light voluminous cargoes which would otherwise not fit in a normal 8’ height container. The only
problem in such types is bow to load the containers under deck where under deck height is a
limitation.

9.9 Bulk Discharge Open Top Container: It is a full height open top container without a solid roof.
Instead it has an open top to allow cargoes to be loaded from the top rather than through end doors.
The bulk discharge open top container has a full width discharge hatch at the front to enable bulk
cargoes to be discharged by tipping the container.

9.10 Open Top Containers: It is ideal for cargo cut of guage in height, actually for onions and
potatoes for proper ventilation.

9.10.1 It is usually provided with a polythene lined tarpaulin to cover the container and keep it water
tight. Heavy machinery can be easily hoisted by a crane and put inside the container through its open
roof.

9.11 Open Container: It is a livestock container for cattle or livestock. It has netted windows on the
side or ends to facilitate ventilation. On the lower part of side walls it has cleaning and drainage
outlets.

9.12 Hide Container: Specially built for raw hide that has characteristics of emitting odour of hide
juices and require air circulation. It is coated with FRP inside which protects container from
contamination and facilities easy cleaning after discharge.

9.13 Half-Height Container: Half-height of nearly all the other containers (except dry-bulk) are
used principally for high density cargoes e.g. for steel sheets, motor cars, agricultural tractor, etc.

9.13.1 It is an open top shipping container which container which has standard length and width but
is only 4’ 3” (approx.1.3 metres) high, half the standard height. These cargoes take less space in
relation to their weight.

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9.13.2 The half height container also has the advantage of loading and discharging in places where
height is a limiting factor.

9.14 Cellular Pallet Wide Container: Shipping container designed to carry an optimum number of
Europallets (European Standard size pallets admeasuring 0.8x 1.2 metres). It is 2.5 metres wide, wider
than standard containers which are 2.44 metres wide. In order to be accommodated in the cells of
cellular containerships, its corners are modified to reduce the width of the base.

9.15 Fruit Container: Insulated container used for the carriage of fresh fruit. It has the same basic
characteristics of a standard insulated container except that it has large internal dimensions to
accommodate particular sizes of pallets and cases of fruits.

9.16 Hardtop Container: It is a normal general purpose container except that the hard top is
removable by a fork-lift truck. This container is suitable for heavy cargoes which are easier to load
from the top with the help of crane.

9.17 Open Side Container (Produce Carrier): Container whose side is open to give unrestricted
access for loading and discharging. The side of the container has removable steel gates and may have
drop down doors covering the lower part. The side is covered by a tarpaulin while in transit.

9.17.1 This type of container has two advantages:

a) Ventilation for perishable goods

b) Loading and discharging at premises where side access is preferred.

9.18 Porthole Containers : A type of insulated container which has two apertures, known as port
holes, through which air of the right temperature for the cargo is delivered from (or returned to) a
terminal’s refrigeration unit or from a clip-on.

9.19 Side Door Containers: A container whose doors are on one or both sides rather than at the
rear. These containers are used when access to rear doors for loading or discharging is difficult, for
example, when they are carried on railway wagons.

10.0 FACTORS TO BE BORNE IN MIND FOR STOWAGE INSIDE CONTAINERS:

(1) Choose the most suitable container to accommodate the cargo.

(2) When the container arrives at loading facility, thoroughly inspect the soundness of
the container.

(3) Never stow heavy goods on top of light goods. Place the heavier items at the bottom
and the lighter ones on top.

(4) Keep within the load limits of the container. Don’t overload.

(5) Distribute the weight of the cargo evenly over the floor of the container. Never stow
too heavy, dense items in one section and light, voluminous items in another.

(6) Stow all cargo tightly.

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 (7) Observe all the handling instructions on the cargo such as “Do Not Drop”. “This
SideUp” etc.

(8) Stow goods with sharp corners and separate them from other types of merchandise.
Use dividers and separating material.

(9) Place any packages containing liquid on a double tier of dunnage. This will reduce the
chance of damage if the packages leak.

(10) Use cargo liners for obnoxious cargo (green hides, carbon black, etc.).

(11) Observe all rules concerning hazardous cargo. Use appropriate labels and placards to
identify containers loaded with dangerous goods.

(12) Stow hazardous cargo at the rear of the container (near the door).

(13) Prepare all necessary documentation in advance.

(14) Record seal number and container number on all shipping documents.

(15) Do not load goods in a container with damaged packaging.

(16) Avoid stowing wet and damped goods together with dry goods.

(17) Do not use dunnage which is incompatible with the cargo.

(18) Do not stow without plastic or water repellent shrouds over the top and sides of the
cargo to protect against damage from water and condensation.

(19) Never stow goods with marked odours close to merchandise which can be
contaminated by these odours.

(20) Do not ship until all container doors are closed and sealed properly.

(21) If wet and dry cargoes are stowed together, dry cargo must always be stowed on top
of the wet cargo.

11.0 ADVANTAGES OF CONTAINERISATION:

11.1 For ship-operators/port operators:

(i) Reduction of port time of ships

(ii) Saving of storage in port warehouses, Container can be stacked in open container
stacking yards.

(iii) Improved working ratio of ships.

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11.2 For ship-users (i.e. shippers/consignees):

(i) Saving in packaging costs (as for example, goods can be packed in cartons instead of in
cases).

(ii) Reduction of damage, pilferage and theft.

(iii) Reduction in marine insurance premiums.

(iv) Greater protection to fragile and easily contaminable cargoes.

(v) Reduction in inland transport costs.

(vi) Faster and reliable delivery.

(vii) Retention of original quality of goods.

(viii) Physical separation of ‘dirty’ cargoes.

(ix) Simplification of documentary procedures.

(x) Less inventory costs as a result of less transit time.

(xi) Stable inventory control made possible by stabilized ship’s operation schedule.

(xii) Reduction in freight rates.

(xiii) Reduction of inventory costs.

(xiv) Guaranteed transit time.

The most outstanding contribution of containerisation is the suitability and capability of

containers for door-to-door transportation internationally).

12. DISADVANTAGES OF CONTAINERISATION:

(a) A carrier may decide to stow a container on deck. Containers shipped on deck are exposed
to the elements and tot the risk of being washed overboard in adverse weather. In
practice, the difficulty is compounded when frequently the shipper is not aware that deck
stowage has taken place.

(b) There are problems of container maintenance, when inadequate inspections for condition
may leave damaged containers in service thus negating the potential benefits and
exposing the contents to water damage in particular.

(c) When consumer goods are concentrated in a single container-load, they become an easy
target for theft.

(d) Inadequate or defective ventilation may increase the risk of “sweat” damage and
condensation.

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 (e) Container shipments may encourage a lower standard of individual packaging of contents
and this could cause a problem particularly when LCL container loads are involved and
transit is not door-to-door.

(f) Incomplete filling of a container or defective stuffing may allow excessive free movement
of contents in transit resulting in self-damage.

(g) A large variation in weight where containers are stowed on deck can affect stability and
unevenly weighted containers can cause problems for the driver of a truck during inland
transit.

(h) Bulky goods cannot be reasonably carried economically in containers. Difficulties in

stuffing arise where one or perhaps two large items occupy a container, leaving much
space in the container unused.

(i) Most container vessels do not have on-board lifting equipment and loading and discharge
are done by gantry located on the dockside. In the event of a major causality at sea, say,
a stranding or collision, cargo can only be moved by specially equipped salvage vessels or
floating cranes. Also following a serious casualty, structural distortions can make
impossible for removal of containers.

(j) Damage to the contents of a container remain concealed until arrival at final destination.
So, no remedial measures can be taken during voyage or transit.

(k) Transshipment problems, when a container is damaged in transit and anther empty
container is not available to stuff the cargo.

(l) Contamination risks if incompatible cargo is stowed in the same container. Also, there is
risk of contamination/by residual material or odour from previous cargo.

13.0 SUMMARY:

(1) Container : Box/ Van

(2) Construction Material : (1) Steel

(2) Aluminum
(3) Fiberglass, Plywood

(3) Soundness : Weather and pilfer proof

(4) Standard Sizes : (1) 20’ x 8’x8’6” – T.E.U

(2) 40’X8’X8’6” F.E.U
(ISO Standard)

(5) Types : (1) Dry Cargo

(2) Reefer
(3) Insulated Port hole
(4) Open Top
(5) Flat Rack
(6) Ventilated & Open Side
(7) Dry Bulk & Tank.

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 (6) Vessels for Carriage of Containers: (1) Container Oriented Ship
(2) Cellular Ship.

(7) Advantages to Shippers : (1) Door to Door Service

(2) Fast overall transit time and quick
delivery.
(3) Loss or practically no damage by
pilferage/theft
(4) Frequent and reliable sailings
(5) Low crating and packing costs
(6) Less handling of cargo
(7) Reduction in insurance premium
(8) Simplified/less documentation
and paper work
(9) Reduction in freight.

(8) Advantage to Shipowners : (1) Fast turn-round time of ships

(2) Less stevedoring costs
(3) No waiting for berths
(4) Less claims
(5) Less port of calls – this less port dues,
Dock dues, etc.

(9) Document in use : Combined Transport Document (CTD)

which covers land, rail, road and sea
transportation.

(10 Essential Facilities Required : (1) Fast road and rail links
(2) Modern terminals
(3) Inland Container Depots (ICDs)
(4) Gantry Cranes, forklifts, straddle
carriers, container gears, stackers,
trucks, trailers, tractors, etc
(5) Infrastructure and complete network.

ooooo

SELF-EXAMINATION QUESTIONS

1. Explain what is meant by a shipping container.

2. How are containers classified? Discuss the different materials used in construction
and
their advantages respectively?

3. What are the different sizes of shipping containers commonly used?

4. What purpose do “thermal” containers service? Name different types of thermal

containers.

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 5. Explain the difference between controlled and modified atmosphere systems. In what
Type of containers are these systems used?

6. Discuss briefly the various advantages of containers.

7. “Container freights are fixed in different ways.” Elaborate the statement.

8. Write short notes on the following types of containers:

(a) Open containers (b) Bulk containers
(c) Liquid containers (d) Insulated containers
(e) Flat rack containers (f) Half-height containers

9. Explain the meaning of the following terms:

(i) FCL (ii) LCL (iii) Multimodal Transport

(iv) MTO (v) MTD (vi) TEU & FEU
(vii) Bay-Row-Tier (viii) Container Seal (xi) Twist Lock

10. Write short notes on:

(a) Container Yard
(b) CFSs
(c) ICDs (See lesson in Current Shipping Environment)
(d) Types of Container vessels

11. Mention five DO’s and five DON’Ts of stowage inside a container.

12. Discuss briefly the various advantages and disadvantages of containers.

RECOMMENDED FOR FURTHER READING:

1. Containerisation & Mutimodal Transport – Dr. K. V. Hariharan, 2nd Ed., 1997.

2. Illustrated Dictionary of Cargo Handling – P.R. Brodie, 3rd Ed., 1997.
3. Elements of Shipping – A. E. Banch, 7th Ed., 1996.
4. Sea Transport (Operation &Economics) – P.M. Alderton, 4th Ed., 1950.
5. Thomas’ Stowage – Thomas/Agnew/Cole, 1st Ed., 1983.
6. Introduction to Shipping – T. R. Pardiwalla.
7. Containerisation & Other Unit Transport – G. Van Den Bur, 1st Ed., 1969.
8. Container Systems – Eric Roth, Rev. Ed., 1973.
9. Containerisation – I.K. Whittaker, 2nd Ed., 1975.

*********

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 ANNEX - 9
SHIPPING PRACTICE FIRST YEAR

FREIGHT & FREIGHT UNITS

1.0 Freight is the remuneration payable for the carriage of goods in a ship in a merchantable
condition.

2.0 Charterparty freight and bill of lading freight differ in many respects.

3.0 Freight on bill of lading shipments (liner freight) is calculated in three ways, weight of cargo,
measurement of cargo, or, when the value is high, at ad valorem freight, the latter being chargeable
at so much per cent on the declared value of the goods.

4.0 When charging freight for the carriage of goods and the rate of freight is to be based on
weight, a distinction is made between:

Short Ton = 2000 pounds = 907.18 kgs

Long Ton = 2240 pounds = 1016.06 kgs
Metric Tons (tonne) = 2005 pounds = 1000.00 kgs

5.0 In order to ensure safe carriage, valuable cargo, which requires special attention, will attract
freight at a certain percentage of the value (ad valorem rates). Weight and measurement are not
taken into account when computing freight on the basis of value.

6.0 The carrier has the right of deciding whether the goods shall be carried at weight or
measurement, whichever produces the higher revenue. In containerized transport this is per TEU.

7.0 Many freight rates are quoted on the basis of weight or measurement, that is to say that
they are applied either per tonne of 1000 kg (2005 lb) or per tonne of 1,133m 3 , whichever produces
the greater revenue. The reason for this method of charging is that heavy cargo will immerse a
vessel to her loadline before her holds are full, while light cargo will fill her space without bringing
her down to her maximum draught. To produce the highest revenue a vessel must be loaded to her
full internal capacity and immersed to her maximum permitted depth. In most trades cargo
measuring less than 1.133m3 per tonne is charged by weight, while items measuring 1.133m3 per
tonne or more are charged by volume.
_____________________________

Please read carefully the following study material along with this lesson:

(a) Lesson 31 entitled FREIGHT in the subject on "Commercial & Shipping Law".
(b) Annex-8 entitled CONTAINERISATION in the Paper on "Shipping Practice".
(For structure of rates on containers).
(c) Chapter 8 on FREIGHT in the prescribed text-book on "Shipping Practice" by Stevens
& Butterfield.

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8.0 Most Lines have now adopted the FAK type of pricing for a 20’ and 40’ container. Where for
a 20’ in case the space on vessel is restricted in terms of weight, Lines may end up imposing a heavy
weight surcharge on per unit.

9.0 It may be considered that light cargoes, fine goods, provisions, etc., are charged on
measurement, and heavy cargoes pay freight on their weight.

10.0 For measuring cargo, exterior measurements are taken, cargo of uneven shape which loses
space in stowing is chargeable on the entire space occupied, including the lost space. All space lost
in such circumstances is termed broken stowage.

11.0 The next most important point in making a freight rate is the amount of space which a
weight ton of a commodity will require when stowed the ship. Theoretically, all rates are based on a
long ton weight of 2,240 pounds (or short ton of 2,000 pounds in some trades) which occupies 40
cubic feet of space.

12.0 Cargo which stows in less than 40 cubic feet is "deadweight cargo," and is usually freighted
by weight. Cargo requiring more than 40 cubic feet for stowage of a weight ton is called "cubic
cargo," and is freighted by volume, usually at a certain amount per cubic foot. Since packaging varies,
the carrier often offers two rates, on per 100 pounds and the other per cubic foot, but reserves the
right to charge "by weight or measurement, whichever yields the greater revenue". A vessel loaded
so that all space is filled and the ship is down to her load line is said to be "full and down." A ship
with 400,000 cubic feet of cargo space and a cargo deadweight of 6,000 tons might be "down to her
marks" with 6,000 tons of a heavy (dense, or deadweight) commodity stowing at 17 cubic feet per
ton, and still have 298,000 cubic feet of unfilled space. If she carried cargo which stowed at 40 cubic
feet per weight ton, she would utilize only 240,000 cubic feet of space for a full load of 6,000 tons. If,
however, the cargo were to be stowed in an average of 60 cubic feet per weight ton, the vessel's
"revenue tonnage" would be 6,667 with all space filled.

13.0 In making rates, the handling and stowage characteristics of a given commodity must be
taken into account. For example, an unboxed automobile requires a great deal of ship space, far in
excess of the actual measurement of the vehicle. The rate, therefore, must include a charge for the
empty space, if the vessel is to earn maximum revenue. Fragile cargo must be protected, and to do
this may take cubic footage beyond the actual measurement of the package. Steel beams, on the
other hand, need little care and occupy a small amount of space in comparison to their weight. They
may be used to offset electric light bulbs, which are exceedingly bulky and very fragile. The rates for
these items are adjusted in accordance with their varying characteristics.

14.0 The perishability, fragility, bulkness, odour, or dangerous nature of a commodity, and the
resulting responsibility which the carrier must assume for its preservation and care while it is in his
custody, exert a considerable effect on freight rates. Since certain commodities are damaged easily,
or may be especially attractive to pilferers, the losses sustained from such causes and for which the
carrier is responsible, will be transferred from the shipper or the consignee to the carrier in the form
of claims. Freight rates must be high enough, therefore, to cover such anticipated losses.

15.0 Exceptionally heavy packages, defined as those weighing over three tons, traditionally have
been freighted at the regular rate for the particular commodity, with a scale of surcharges based on
the actual weight.
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16.0 Expense incurred particularly for the heavy lift are charged to the shipper. Even where
modern ships have cranes or booms handling up to ten tons at a time, there still is a great deal of
arduous, time-consuming labour involved in properly stowing a very heavy piece of cargo and
compensation to the ship for this loss of efficiency is justifiable.

17.0 Extra-long pieces, such as timbers or steel beams, are handled slowly and often interfere
with the stowage of other cargoes in the ship. It should be understood that the operator does not
profit particularly by handling these overweight or overlength items; usually, the rate charged
represents the actual "out-of-pocket" expenses incurred.

18.0 Ocean freight rates are divided into two categories, class rates and commodity rates. In
general, the class rate may be described as the rate assigned to a large number of unrelated
commodities which have been studied individually and found to require the same revenue for their
transportation. The commodity rate is a specific charge for carrying a designated item, such as
granulated sugar in bags.

19.0 Commodity rates take precedence over class rates, so that if these should be two entries in
the tariff for the same item, the commodity rate would be used in preference to the class rate.

10.0 Regardless of how an item is freighted, a certain administrative expense to the carrier is
always involved in processing a shipment. It is customary, therefore, for carriers to impose a
minimum charge for each bill of lading, regardless of the actual freight earned.

11.0 The pricing of a cargo ship's services is dependent on the forces of supply and demand. As
with all forms of transport, the demand for shipping is derived from the demand for the
commodities carried. Ships on any particular route are competing against other carriers on the same
route, vessels serving alternative supply areas, air transport and, in coastal services, inland transport.
Total distribution costs generally account for between 10 and 25 per cent of the market price of
commodities.

12.0 Charter-party freight is fixed at an agreed rate for so much per ton (usually of 1015 or 1016
kilos) or other trade measure, depending on the terms of the charter-party. Here there is no
stipulation for weight or measurement cargo.

13.0 Whenever disputes occur regarding the weight of cargo carried, the person who requires the
goods to be checked, must pay costs of such check-weighing.

14.0 Charter parties may be for a single voyage at a rate per tonne of the commodity carried (a
voyage charter) or for a period at a stipulated rate of hire, usually based on the ship's deadweight
carrying capacity (a time charter).

15.0 The rate structure for tramps is, therefore, very simple, being the result of competitive
interplay of supply and demand. Rates in the liner trades are determined differently. Here the
shipowners control fairly large concerns, and the bulk of their traffic comes from a host of small
shippers. It is, therefore, more convenient for ship owners to estimate how much their customers
are prepared to pay and to fix their rates accordingly. These are known as tariff prices, which are
issued by the liner conferences. As liner rates are relatively stable, merchants can quote prices
(including freight) before the goods have been shipped.

16.0 The master has a lien on all goods for freight due, but not paid, and until these charges are
paid he may retain the cargo. If the master delivers the cargo before payment of freight he may lose
his lien, therefore he is entitled to claim his freight when he is ready to deliver.

321
17.0 Stoppage in transitu. The carrier has the right of stopping goods in transit if freight has not
been paid when freight is to be paid within a stipulated time before delivery. He may instruct the
Master to hold on to or return the goods. Should the shipper himself have paid the freight and
charges, and not have received payment from his consignee who refuses to pay, or becomes
insolvent or bankrupt, he may also instruct the carrier to have the goods stopped until such time as
he may notify him of receipt of the charges, or if there is no chance of his consignee paying for the
goods, then he may instruct the carrier to return the same to him. In this case back freight would be
chargeable to the shipper.

18.0 The expression "freight ton" or "shipping ton" or "revenue ton" or "mercantile ton" relates
to the tons upon which freight charges have been based, either measurement or weight.

19.0 In the case of damaged cargo, the shipowner is entitled to full freight provided he delivers
the cargo.

ooooo

SELF-EXAMINATION QUESTIONS

1. (a) Define freight.

(b) What are short tons, long tons and metric tons?

2. (a) Briefly describe some of the factors on which liner rates are based upon.
(b) What role does the stowage factor play in fixing of liner rates.

3. How is the rate fixed for tramp vessels?

4. Write notes on
(a) Stoppage in transitu.
(b) Class rates and commodity freight rates.
(c) Ad valorem freight rate.

RECOMMENDED FOR FURTHER READING:

1. Determination of Ocean Freight Rates -- M. H. Page, 1st Ed., 1979.

2. Elements of Shipping -- A. E. Branch, 7th Ed., 1996.
3. Containerisation & Multimodal Transport -- Dr. K. V. Hariharan, 2nd Ed.,
1997.
4. Thomas' Stowage -- Thomas/Agnew/Cole, 1st Ed., 1983.
5. Carriage of Goods by Sea & Multimodal Transport -- Dr. Nilima
Chandiramani, 1st Ed., 1997 (Reprint 2013).
6. Shipping & Chartering Practice -- Gorton, Ihre, etc., 4th Ed., 1995.

*****************

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 ANNEX - 10
SHIPPING PRACTICE FIRST YEAR

THE SHIP'S CREW

1.1 The captain or MASTER is the HEAD of shipboard organization

1.2 The crew is the staff who sails on board a ship and responsible for its operation, primarily
while the ship is at sea

1.3 It also has certain responsibilities while the ship is in port.

1.4 The crew of a ship in the merchant marine is divided into three departments: The deck
department, engine department, and catering department.

1.5 Whilst at sea, the Master is responsible for the safe navigation of the vessel and care of the
cargo, even though some of these duties are actually carried out by other officers on board. The
Master's authority remains even during the time when there is a qualified pilot on board. If he
believes that the vessel is heading into danger, he has the authority to override the pilot's
instructions.

1.6 When in port, the Master deals with the port agent in all matters concerning the ship.
Although the agent will also be in touch with the owners' office, it is likely that the Master will seek
approval from his owner before most actions are taken.

1.7 The Master signs all the Bills of Lading for cargo received on board the ship, although the
cargo work is normally handled by the Chief Officer or "Mate". Normally, Bills of Lading are left for
signature by the port agents, although it is essential for them to have a written authority from the
Master to sign such Bills of Lading on his behalf. Even in these circumstances, it is difficult for the
Master to escape responsibility if anything goes wrong with the cargo documents.

1.8 The Master also maintains the ship's accounts, which he has to present to the owners.
Usually, the Master will collect cash from the agents, such advances having been authorized by the
owners, and he will disburse all the necessary amounts during the vessel's stay in port.

1.9 Usually, owners send instructions to the vessel specifically addressed to the Master. His job is
to keep the owners fully advised of all movements of the ship in and out of port and whilst at sea. All
tramp owners rely heavily on their Masters for information. They can be of considerable assistance in
building up various information which can be useful to the owners.

1.10 In the event of difficulties with the cargo or crew, the Master may have to be in touch with
the owners' local P & I agent.

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2.0 THE CHIEF OFFICER (MATE):

2.1 It is the Chief Officer's job to supervise the cargo handling of the ship and he is responsible
for loading, stowing and discharge of the cargo and its care whilst on the vessel. Of course, a first
class Mate can be of great assistance to the Master, maintaining order and discipline on board the
vessel to ensure that everything functions smoothly. In the event of a Master being incapacitated, it
is the Chief Officer who takes over the command of the ship, provided he is suitably qualified.

3.0 DECK STAFF:

• The deck department is headed by a chief officer (1st Mate).

• C/O is the head of the deck dept & supervises the crew members assigned to his
department.
• Assisted by 2 or more senior licensed deck officers or mates who stand the watches.
• This involves administrative tasks such as scheduling work, quality control, coordinating
with other departments, and conflict resolution.
• The Chief Mate also compiles supply, overtime, and cost control records, and requisitions
or purchases stores and equipment.
• Routine work on board ships is divided into daily watches. The usual schedule is 2
watches of 4 hrs each within a 24-hour workday.
• With GMDSS, the communication dept is handled by the Deck.

3.1 The ship's other deck officers, generally a Second Mate and Third Mate, are also members of
the Deck Department.

3.2 Each watchstanding officer is responsible for the unlicensed crewmen on his watch.

3.3 This department also includes petty or unlicensed crew members.

3.4 The chief unlicensed man is known as a boatswain (Bosun).

3.5 The unlicensed watchstanders are able-bodied seaman (A.B.) and ordinary seaman (O.S.).
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3.6 They stand wheel watches and lookout watches with the licensed deck officers when they
are on watch.

3.7 When they are not engaged in watchstanding duties, they do maintenance chores under the
supervision of the bosun.

3.8 It is normally the responsibility of the Second Officer to carry out the navigation of a vessel,
under the supervision of the Master, whilst all the Deck Officers serve as Officers of the Watch. In
addition, they will have other tasks to perform to aid the smooth running of the vessel.

3.9 The Second Officer, called the Navigating Officer, looks after charts, nautical publications,
navigational equipment, their maintenance and upkeep.

3.10 Second Officer is also called the Medical Officer under the Master. He indents for medicines
as per the medical scales, stores them properly in the medical locker, gives treatment to the crew
members/officers and maintains a medical log.

3.11 The Third Officer looks after the flags, meteorology, life saving and fire-fighting appliances.

3.12 The navigating bridge and engine room of the ship are manned round the clock for safe
navigation. As the duty involves continuous vigilance, alertness, presence of mind, judgement and
strain, officers keep only four hours continuous watch at a time, both on the bridges as also in the
engine room.

3.13 The Radio Officer keeps 8 hours independent watch per international watch timings. He
receives weather reports and transmits weather observation reports made by the Navigating
Officers. (Nowadays the role of the radio officer is obsolete after the implementation of GMDSS) This
is shared between the Navigating Officers

3.14 When a vessel is at sea, there is no cargo work except for checking that cargo has not shifted,
ventilation is being properly given as required and lashings checked and tightened morning and
evening, if deck cargo is carried.

3.15 In ports abroad the deck officers are fully involved with cargo discharging and loading.

3.16 On tankers, due to the nature of liquid cargo, loading is done through pipes using shore
pumps whereas discharging is done through pipes using ship's pumps and into shore tanks. Opening
and closing of valves to tanks and in the pump room and on pipe lines are all physically handled by
the officers only. There is no shore labour to work on tankers.

4.0 ENGINE STAFF:

• The Engine department is headed by a chief engineer.

• He has other licensed engineers to assist him with watch standing in the engine room
whether the vessel is at sea or in port.
• The performance, maintenance and repair chores in the engine room is taken care by the
Engine room team.
• The unlicensed personnel of the engine department consist primarily of oilers, wipers
and the electrician.
• In case of the vessel being geared, the team also takes care of the maintenance of the
ships gear, which is used for loading & discharging a vessel.
• All essential machinery on board the ship is maintained as per the PMS by this team.

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5.0 CATERING STAFF:

• The chief steward or purser is the head of the catering department.

• He assists the captain in dealing with entering and leaving formalities and other
administrative work if necessary.
• In port, he will take care of ordering and supervising the delivery of provisions.
• He also prepares daily menus, look after the supply and distribution of galley goods and
is in charge of crew wages and the entertainment fund.
• The chief steward is assisted by a chief cook and his assistant cooks, messmen and
assistant stewards.
• Now with the modernization, the catering department is included in the deck
department on most ships. So there are only two departments on board.

5.1 In most of the vessels now the Catering department consists of the following three persons
only:
• Chief Cook.
• 2nd Cook.
• Stewards (2 Nos).

6.0 For the safety of the vessel and life at sea, requirement of minimum qualified officers is laid
down in the Merchant Shipping Act, namely a duly certificated Master, Chief Engineer Officer, 2nd
Engineer Officer, Radio Officer and besides them, an officer with First Mate's certificate.
Employment of other officers and their number is governed by the operational requirements and
agreements between Officers Union and the vessel's owners. An average-sized vessel may carry the
following crew:

 Deck Officers - 4
 Engineer Officers - 5
 Petty Officers - 4
 Engine Crew - 4
 Deck Crew - 5
 Catering Crew - 3

7.0 SUMMARY :

6.1 The Master, as over all in-charge, keeps himself updated, as to the day-to-day working of the
ship. The Chief Engineer Officer is over all in-charge of the engineering department, whether the
ship is in port or at sea, and responsible to the Master. The Captain takes rounds to inspect his vessel
and any deficiencies noticed are reported to the respective departmental heads for taking remedial
action. Life saving appliances and fire fighting appliances are regularly checked and the crew
practices them periodically. Any crew members committing offences are officially warned and/or
fined and appropriate official Log Book entries are made, the Log Book being provided and
maintained compulsorily under the Merchant Shipping Act.

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ON UMS Vessels the Engine staff composition would be different.

ooooo

SELF-EXAMINATION QUESTIONS

1. What are functions of

(a) The Master of a cargo vessel,
(b) The Chief Engineer.

2. Why is the role of a Chief Officer/Mate, considered important for the efficient running of a
vessel?

3. Wrote short notes on the duties of :

(i) Second Officer
(ii) Third Officer
(iii) 2nd Engineer
(iv) Bosun

4. Draw the organogram of the ship board organogram and various departments.

RECOMMENDER FOR FURTHER READING:

1. Elements of Shipping -- A. E. Branch, 7th Ed., 1996.

2. Sea Transport -- P. M. Alderton, 4th Ed., 1995.
3. Economics of Shipping Practice & Management -- A. E. Branch, 2nd Ed., 1986.

***************

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 ANNEX-11
SHIPPING PRACTICE FIRST YEAR

INWARD & OUTWARD CLEARANCE OF SHIPS

1.0 INTRODUCTION:

1.1 When a vessel enters a port, she is "entered", and, when all the necessary documentary
formalities are completed, she is given "inward clearance". Similarly, when she sails from the port,
the customary procedure is performed for "outward clearance ".

1.2 If a vessel or shipping line does not have their own staff at the port, and where a vessel is
foreign-owned or where a vessel is under charter, an agent may be appointed to deal with the
clearance work. He is called the Shipping Agent or the Ship's Agent.

1.3 Before arrival of the vessel, prior arrangements have to be made. For example, local harbour
authorities have to be advised; suitable berths have to be arranged; pilots, and wherever necessary,
tugs have to be secured, and competent stevedores have to be engaged for the loading and/or
unloading of cargo.

2.0 INWARD CLEARANCE:

The following documents are required:

2.1 Report: The report is one of the most important documents necessary for clearing a vessel
inward. The report must give particulars and description of all cargo carried, port(s) of loading,
whether any cargo is to remain on board and the names of the consignees, particulars of surplus
stores remaining on board as also details of passengers to be landed. Further, any accident to the
ship that may have occurred during the voyage must be stated, and particulars given of any wreck or
derelict sighted. The Master must sign his report in the presence of a Customs Officer, who must, in
turn, attest the signature. Due to technological advancement in the field of communication and the
volume of cargo increasing, this is nowadays transmitted electronically and termed as a MANIFEST.
While entering this is called as an IGM (IMPPORT GENERAL MANIFEST) and while exiting it’s called as
an EGM. (EXPORT GENERAL MANIFEST)

2.2 Patique: For all intents and purposes, this is a Bill of Health handed over to the Master of
every foreign-going vessel arriving in this country. It is a certificate which states that the health of the
vessel or every person on board is in good condition, free from contagious diseases, there being no
reason why the vessel should not enter the port. No cargo may be discharged or passengers landed
until a master receives his Pratique.

2.3 Grain Cargo Certificate: When a vessel loads a full cargo of grain, it is subject to the
requirements of the Merchant Shipping Act regarding safety measures to prevent the cargo from
shifting. It is the duty of the Master to secure a certificate at the port of loading, certifying that the
regulations have been complied with. This "grain cargo certificate" is presented to the Customs on
arrival at destination port. (Not required nowadays in most of the ports)
___________________________
Note: While reading this lesson, refer to lesson 20 entitled "Statutory Documents on Board" in Shipping
Practice. Also refer to Chapter 17 on "Ship's Papers & Procedure of Ships Entering & Leaving Port" in the text-
book on Shipping Practice by Stevens & Butterfield.

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2.4 Inward Pilotage: When a pilot has brought a vessel into port, he signs and hands over to the
Master a form in which particulars of the draft of the vessel and the course over which she was
piloted are detailed. Pilotage charges are calculated on the ship's draft. The pilot card is handed over
to the Port authorities, and the charges are paid to them, after which the report is signed, indicating
to the Customs Authorities that the charges have been paid.

2.5 This again is now handled by the agent of the vessel where all the particulars pertaining to
the vessel arrival condition is declared by the MASTER to the vessel agent for all dues pertaining to
the vessel to be taken care by the vessel agent.

2.6 Deck Cargo Certificate: When a vessel is carrying deck cargo or has cargo in parts of the
vessel considered as deck space, the Customs Official measures and calculates the number of
mercantile tons of cargo so cleared. This information is then evidenced in the "Deck Cargo
Certificate".

2.7 Tonnage Dues: These are charges levied by Port Authorities and used towards the
maintenance and upkeep of their landing stages, port equipment and the like.

2.8 Light Dues: These are charges collected by the Customs Officials on behalf of the Mercantile
Marine Department (MMD). The dues are levied in order to maintain the light houses, around the
shores. The dues are chargeable on all vessels coming into, or leaving a port in this country, except
where a vessel has neither passengers nor cargo.

2.9 Passenger Lists: When clearing inwards a passenger ship must furnish to the Customs
Authorities a complete passenger list with complete details.

2.10 The Ship's Register: This is the "passport" of a vessel. The document gives the name of the
vessel, her registered tonnage, name of owners, master, nationality and port of registry.

2.11 Articles and Discharge Books: The Shipping Master, or his representative shall be present
when a ship pays off the crew. The Shipping Master is an officer of the Government of India working
under the Director General of Shipping. Shipping Master looks after the signing on and signing off the
crew and implementation of the agreed working terms and conditions. He has legal powers.

2.12 B.B. Certificate: This is issued by the Mercantile Marine Office and testifies that the Master
has deposited, at the required office of the Shipping Master, the official log book, agreement and list
of crew.

2.13 The Master makes himself available personally before the Customs Authorities with his
report and the above forms. He certifies that all statements, to the best of his knowledge, are true
and correct. The reporting clerk thereupon stamps the report, and this certifies that the ship has
been cleared inwards and no further documentary evidence is required.

2.14 In addition to the Customs formalities, the Master may "note protest" if there has been
damage to cargo by perils of the sea or accident, or against the action of charterers in not loading in
accordance with the agreement. This is made as a declaration on oath before a Notary Public, and if
claims are likely against the ship the protest is "extended" by giving full details from the log books.
Underwriters may refer to these documents for purposes of claims, for example, damage by heavy
weather or by collision.

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 330

3.0 OUTWARD CLEARANCE :

For convenience, the Master -- when clearing a vessel inwards -- attends to certain formalities
regarding clearance outwards, thus obviating his making a second visit to the Customs House. The
following documents are required:

3.1 Stores Authority Bond Note: This is merely a written request by the Master to the Customs
Authority for permission to place on board his vessel certain bonded and dutiable goods, as
described in the note, for the use of his crew and passengers, if any.

3.2 Entry Outwards Form: This contains particulars as to the vessel's destination and her loadline.

3.3 Master's Declaration for vessels outward bound with cargo: The declaration is made by the
Master that all requirements of the Merchant Shipping Act respecting outward bound ships have
been complied with. A special form is used when the vessel sails outward in ballast, certifying that no
cargo is being carried.

3.4 Bonded Store List: This gives a complete summary of all bonded stores remaining on board,
details of number of passengers and destination of the vessel.

3.5 A.A. Certificate: This is issued by the Shipping Master's office in India and certifies that the
Master has engaged his crew in the presence of the Government Authority who has inspected the
necessary papers.

3.6 When all the above forms are completed, the Bonded Store List is attached to a clearance
label and seal. On the label the name of the ship and the Master is written.

3.7 The principal searcher at the Customs House checks the documents, signs and stamps the
label, and once the stamp is placed on the label, the ship is cleared outwards and ready to sail.

oooooo

SELF-EXAMINAITON QUESTIONS

1. What do you understand by the following terms?

Note of Protest; pratique; ship's register; bonded store list and stores authority bond
note.

2. Name some of the documents required for

(a) Inward clearance,
(b) Outward clearance.

RECOMMENDED FOR FURTHER READING:

1. The Merchant Shipping Act, 1958 -- J. S. Gill, 1994 Ed.

2. Elements of Shipping -- A. E. Branch, 7th Ed., 1996.

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****************

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 ANNEX – 12
SHIPPING PRACTICE FIRST YEAR

EXPORT AND IMPORT PROCEDURES

(INCLUDING DOCUMENTATION)
1.0 EXPORTS:
1.1 Packaging:

1.1.1 When goods are ready for export, care must be taken to pack them suitably. The package
should be sufficiently strong to withstand its normal handling in transit and to protect its contents till
it reaches its destination. Packing can be done in cases, crates, bags, etc., according to the custom of
the trade.

1.1.2 While packing the goods, the following considerations may help in minimising the cost:

(i) In respect of measurement cargo the package should be of minimum dimension.

(ii) There must be optimum utilisation of space within the package.
(iii) Goods attracting different freight rates should not be packed together in one
package as the carrier will be charging freight on the whole package at the highest
rate applicable on the goods involved.

1.2 Marking:

1.2.1 Each package should be marked by indelible ink or paint in bold letters at least 2" size in (in
capital letters) to indicate the buyer's name and port of destination, and the serial number of the
package out of the number of packages of the consignment. Examples:

(a) C.H & Co., (b) C.H. & Co.,

Rotterdam Antwerp
1/50 2/100

1.2.2 Any other details, e.g. import/export licence number, country of origin, etc. may be shown, if
required.

2.0 FREIGHT BROKER:

2.1 Please see lesson 17 entitled "Other Intermediaries in Shipping" in Shipping Practice.

3.0 CLEARING & FORWARDING AGENTS:

3.1 Please see lesson 17 in Shipping Practice.

4.0 BILL OF LADING:

4.1 Please see lesson 6 in Shipping Practice where all aspects of the B/L have been dealt with at
great length.
____________________________
NOTE: While reading this lesson, please refer to Annex-4 entitled "CLEARING & FORWARDING OF
CARGO" in Shipping Practice.

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5.0 IMPORTS:

5.1 An importer will receive intimation and endorsed negotiable copy of bill of lading, invoice,
packing list, etc., from the shipper/bank, regarding the goods consigned to him. He should ascertain
the arrival date of the ship from the shipping company and two or three weeks before the arrival of
the ship, should handover all the relevant papers to the clearing and forwarding agent. The clearing
and forwarding agent will help him in:

(i) Processing customs documents (Bill of Entry).

(ii) Paying customs duty.
(iii) Paying the freight if the consignment has been shipped "freight payable at
destination".
(iv) Surrendering duly discharged negotiable Bill of Lading to the shipping company.
(v) Obtaining delivery order from the shipping company; and
(vi) Clearing the goods from the docks after paying port charges (cargo dues) and after
custom examination.
(vii) Delivering the goods to the importer.

6.0 GENERAL LANDING DATE, FREE DAYS AND DEMURRAGE:

6.1 Consignments are to be cleared expeditiously from the docks after their landing. The Dock's
Manager of the port declares the "General Landing Date" for cargoes discharged from a vessel which
will be the day on which not less than 2/3rd of the vessel's import cargo has been discharged. If the
general landing date falls on a Sunday or on a holiday, then the next working day is declared as
general landing date.

6.2 All consignments are usually allowed storage in the dock free of demurrage for four days (3
days in Mumbai Port) following the general landing date declared by the Dock's Manager.

6.3 When deliveries are effected by the consignees during the free days, they have to pay to the
port authorities only wharfage charges (port charges) as per Dock Scale of Rates. However, when the
consignees take delivery of import cargo after expiry of free days, then the consignments incur
demurrage, which is to be paid in addition to wharfage charges. Demurrage charges are normally
very heavy and it acts as a penalty for the clearance of import consignments. The provision is
obviously meant to enforce expeditious clearance of goods from the docks.

7.0 CLAIMS:

7.1 For Partial Loss Damage Claim:

7.1.1 If part of a consignment is found defective on unloading, the consignee or his clearing and
forwarding agent has to apply to the shipping company in writing requesting to conduct a ship's
survey on the defective goods. A ship's survey (survey by surveyors appointed by the shipping
company) will be granted if a survey is sought for within 3 days from the last date of discharge of
cargo from the ship. This will be deemed to have been surveyed within the customary time limit. If
applied for a ship's survey thereafter, normally a time-barred ship's survey will be granted upto two
weeks. Ship's surveyors visiting the docks daily will survey the goods and issue a survey report, a
copy of which will be given to the consignee/his clearing and forwarding agent.

7.1.2 The consignee/his clearing and forwarding agent thereafter can clear the goods and submit
to the shipping company a claim for partial loss/damage. The claim bill is to be made on of CIF value
of the goods missing/damaged plus proportionate customs duty thereon. Alongwith the claim bill (in
4 copies), other documents to be submitted are invoice showing CIF value; Bill of Entry; copy of ship's
survey report and copy of Bill of Lading.
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7.2 For Short-landing Claim:

7.2.1 If some packages of the consignments are found missing while taking delivery,
consignee/clearing and forwarding agents has to write to the shipping company reporting about the
missing packages, enquiring about their whereabouts and lodging a formal claim. Shipping company
will take up with stevedores and port authorities for tracing the packages and if not traceable at the
port, the shipping company will send tracer enquiries to the port of shipment and other ports of call
of the vessel. Port authorities, as bailees, will receive the goods landed from the ship and deliver the
goods to consignees after collecting from them dues on cargo. As receipt of the goods received from
the ship, the port authorities will issue to the shipping company tally sheets and remarks list. While
the tally sheets will record the quantity of cargo landed, the remarks list will show the condition in
which the cargo is landed.

7.2.2 If the port authority's tally of a consignment is short and the missing packages are not traced
at the docks and the shipping company confirms that the missing goods are not traced at other ports
of call of the vessel and that the port of shipment has confirmed the shipment in full, then the port
authorities will return the missing goods as short-landed and issue a short-landing certificate to the
consignee/his clearing and forwarding agents.

7.2.3 The consignee has to submit to the shipping company the claim in respect of shorthanding in
the form of a claim bill (4 copies) for CIF value of the shortlanded packages together with invoice
showing CIF value, packing list, if necessary, and shortlanding certificate issued by port authorities.

7.2/4 Consignee can submit a claim under insurance policy to his underwriters and accept payment
after signing letter of subrogation. In such cases, the underwriter will approach the shipping
company and seek settlement of the claim.

8.0 SHIPPING BILL (FOR EXPORTS):

8.1 Shipping Bill is the main document required by the Customs Authority for allowing export
shipment. Basically, shipping bills are of various types. The major difference between one type and
another type of Shipping Bill lies with regard to the goods being subject to: (a) export duty/cess, (b)
free of duty/cess, (c) entitlement to duty drawback (d) entitlement of credit of duty under DEPB
scheme and (e) re-export of imported goods.

8.2 "Free" Shipping Bill is used for export of goods which neither attracts any duty/cess nor is
entitled to duty drawback on their exportation.

8.3 "Dutiable" Shipping Bill is used in case of goods subject to export duty/cess, but may or may
not be entitled to duty drawback.

8.4 Drawback Shipping Bill or Bill of Exports is the document to be filed with the land Customs
Authorities for export of goods which are entitled to drawback.

8.5 DEPB Shipping Bill issued when the goods are exported under DEPB scheme.

8.6 Shipping Bill for Shipping Ex-Bond is for use in case of imported goods for re-exports and
which are kept in bond.

8.7 Following documents are required for processing a Shipping Bill:

(a) GR forms in duplicate for shipments to all countries.

(b) Four copies of packing list giving contents, quantity, gross and net weight of each
package.
334
 (c) Four copies of invoices indicating all relevant particulars such as number of packages,
quantity, unit rate, f.o.b./c.i.f. value, correct and full description of goods, etc. (One copy
of this invoice is to be pasted on the duplicate copy of Shipping Bill).
(d) Contract, Letter of Credit, Purchase Order.
(e) Inspection/Examination Certificate.

8.8 The formats presented for the shipping bill are as under:

(i) White shipping bill for export of duty free goods is prepared in triplicate in the
standardized format.
(ii) Green shipping bill for export of goods under claim for duty drawback is prepared in
quadruplicate.
(iii) Yellow shipping bill for export of dutiable goods is prepared in triplicate.
(iv) Pink shipping bill for export of duty free goods ex-bond is prepared in triplicate.
(v) Blue shipping bill for exports under the DEPB scheme is prepared in seven copies.

9.0 THE BILL OF ENTRY (FOR IMPORTS) :

9.1 The document on the strength of which clearance of imported goods can be effected is
known as the Bill of Entry (B/E), the form of which has been standardized by the Central Board of
Excise and Customs. The Bill of Entry should be type-written.

9.2 No bill of entry is, however, required in the following cases:

(a) Passengers' baggage.

(b) Favour parcels.
(c) Mail bags and post parcels.
(d) Boxes, kennels or cages containing live animals or birds.
(e) Un-serviceable stores, e.g., dunnage wood, empty bottles, drums, etc., of reasonable
value (below Rs. 50/- per piece.)
(f) Ship's stores in small quantities for personal use.
(g) Cargo by sailing vessels from Customs ports when landed at open bunders only.

10.0 TYPES OF BILL OF ENTRY :

10.1 All goods discharged from a vessel, from foreign or coastal ports, are cleared on Bills of Entry
in the prescribed forms presented under the Bill of Entry Regulations, 1971.

(a) Goods entered for home consumption are cleared on 'White' Bills of Entry.
(b) Goods entered for warehousing are removed into bond on 'Into Bond' Bills of Entry
('Yellow' Bills of Entry).
(c) Goods cleared ex-bond for home consumption on payment of duty on "Ex-Bond" Bills or
'Green' Bills of Entry.

10.2 Printed Bill of Entry forms are available with government authorized agents.

10.3 For imports through the medium of post there is no B/E. Instead a waybill is prepared by the
foreign post office for assessment of duty.

11.0 WHEN TO PRESENT BILL OF ENTRY?

11.1 It should be presented for 'noting' in the import department of the Customs House after the
Import General Manifest which gives a detailed description item-wise of the goods brought by the
concerned vessel is filed by the ship's agent. A facility has been afforded to the ship's agents to lodge
335
this manifest 14 days in advance prior to arrival of the vessel. This concession has been given to
facilitate the importer's Custom House Agent to keep the documents ready so that immediately on
arrival of the vessel and landing of the cargo, the same could be cleared on examination and
payment of duty thereon without any loss of time. The date of presentation of the Bill of Entry is very
important as the rate of duty applicable to the imported goods will be the rate which is in force on
the date of presentation.

12.0 SALIENT FEATURES OF THE BILL OF ENTRY:

12.1 Salient features of the Bill of Entry which is to be presented for clearance of goods for home
consumption are mentioned below:

(1) Origin & Vessels Particulars: The importer or his Clearing Agent has to give relevant
particulars of the origin of the consignments and the vessel e.g. port of Shipment,
country of origin (and country consignment if different), vessel's name and rotation
number and also Bill of Lading date.

(2) Particulars of the Goods: In regard to the goods covered by the Bill of Entry, certain basic
information has to be furnished by the importer which includes (I) Number and
description, as well as marks and numbers of the packages; (ii) weight/volume/or
number in so far as quantity is concerned; (iii) Description of the goods imported --
details to be given separately for each separate class of goods, (iv) Gross weight and total
number of packages have also to be given.

(3) Value: The importer has also to indicate assessable value in terms of Section 14 of the
Customs Act, 1962. For arriving at this assessable value he has also to give further break-
up of invoice value, freight, insurance, exchange rate, loading and local agency
commission, miscellaneous charges and landing charges (taken into consideration for the
assessable value).

(4) Duties Leviable: The form has separate columns for indicating Customs tariff heading and
exemption notification wherever applicable as also for indicating the customs duty-rate
and amount the Central Excise Tariff item and Exemption Notification No. if any
applicable. For purposes of contravening duty, there is separate column indicating the
value, the rate and amount and the total amount of duty on the goods both in figures
and words to be indicated by pin-point typewriter.

(5) Codes: For certain statistical purposes (which is the basis of Foreign Trade Statistics),
certain basic information is taken out from each Bill of Entry. To facilitate this, certain
code numbers have also to be indicated by the importer while filing the Bill of Entry
which include Port Code, Custom House Agent Code, Importer Code, Country of
origin/Consignment Code, Unit Code, Currency Code, etc.

(6) Declaration of Importers/Clearing Agent: Besides the information of the type referred to
above, certain declarations have to be furnished by the importer and his authorized
Custom House Clearing Agent wherever the Bill of Entry is processed through a Clearing
Agent. Some of these declarations have to be signed by the importer himself. These
specifically include declaration about correctness of the contents of the goods described
in the Bill of Entry (being in accordance with the invoice and other documents),
correctness of the price/value. Declaration whether the goods have been purchased on
outright purchase/consignment basis and whether the importer has any connection with
the supplier/manufacturer.

336
 Importer's declarations are furnished and signed by him on the reverse of the Bill of
Entry. In cases when an importer clearing his goods through a Custom House Agent, does
not have his office at the port, the declarations may be signed by the importers on a
separate sheet of paper which may be attached to the reverse of the bill of entry. The
Appraiser may make the final assessment after the C.H. Agent pastes the declaration on
the reverse of the Bill of Entry.

13.0 DOCUMENTS FURNISHED WITH B/E:

13.1 Apart from filling up various columns of this prescribed bill of entry form, the importer is
supposed to submit certain essential documents which may be required for checking the correctness
of the declarations made and for completing the assessment (for checking value and for determining
the classification and rates of duties) and import control licence or suitable declarations for
determining permissibility of import etc. The documents presented along with the Bill of Entry
generally include Invoice, Packing List, Bill of Lading or Delivery Order, Import Licence(s) / Customs
Clearance Permit, Insurance Policy, Certificate of Origin, etc.

14.0 PRESENTATION OF BILL OF ENTRY AND NOTING THEREOF:

14.1 The Bill of Entry after completing all the relevant columns and with proper declarations
signed by the importer (and or his Clearing Agent if any) is presented in the import noting
department. After its proper scrutiny, vis-à-vis, the import manifest and also with respect to the
various particulars declared on the bill of entry and the attached documents (which normally covers
invoice and the bill of lading at that stage), if no discrepancies are noticed, the bill of entry is deemed
to have been presented and the date of presentation is satisfied and bill of entry noted against the
relevant entry in the manifest. This date of presentation becomes crucial for determining the rate of
duty (if the vessel has already entered) as well as rate of exchange.

14.2 After a bill of entry is 'noted' in the Import Department, the same is routed through the
Appraising Main Section to the Appraising Group concerned for dealing with 'live' documents for
scrutinizing the bill of entry and noting the rate of duty. The Bill of entry is scrutinized to ensure that:

 All the columns have been duly filled in by the importer.

 The Bill of Entry is accompanied by relevant documents.

oooooo

SELF-EXAMINATION QUESTIONS
1. Explain the terms "packaging" and "marking". What is their importance in shipping?
2. What are the functions of a C & F Agent?
3. How are claims dealt with for (a) Partial Loss/Damage, and (b) Short-landing?
4. What do you understand by "general landing date" and "free days"?
5. What is a Shipping Bill and what documents are required to process it through Customs?
6. How many types of Bills of Entry are there?
7. State the essential features of a Bill of Entry document.
8. List some of the documents furnished with the Bill of Entry.

RECOMMENDED FOR FURTHER READING:

1. How to Import -- Nabhi, 1998-99 Edition.
2. How to Export -- Nabhi, 1998-99 Edition.

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 ANNEX - 13

SHIPPING PRACTICE FIRST YEAR

ILLUSTRATIONS AND SHIPS' PROFILES/PLANS

Contents

ARRANGEMENT OF TANKER PIPELINES Page 20

ATLANTIC CONTAINER LINE'S G2 (RORO) VESSEL (PROFILE) Page 17
BARREL STOWAGE Page 6
BROKEN STOWAGE Page 6
BULBOUS BOW Page 4
BULK CARRIER Pages 11 & 12
COMBI KING-45 (PROFILE & PLAN) Page 12
CONTAINER/BULK CARRIER (PROFILE & PLAN) Page 12
CONTAINER ELEVATING PLATFORM Page 8
CONTAINER HOOK POINTING OUTWARDS Page 8
CONTAINER SHIP (PROFILE & PLAN) Page 17
CONTAINERS Page 9
CONTILEVER CRANE JIB Page 8
CRANES Pages 7 & 8
CRUDE OIL CARRIER (PROFILE & PLAN) Page 19
DANGEROUS GOODS CODE/LABELS Page 16
DEADWEIGHT SCALE Page 5
DERRICK Page 5
DERRICK ARRANGEMENT Page 3
DISCHARGING WITH SHIP'S GEAR Page 6
DOCK LEVELLER (FOR CONTAINERS & FORKLIFTS) Page 7
DOUBLE FACE PALLET Page 7
ELEVATING PLATFORM Page 8
EXTENSION FORKS Page 7
FORE & AFTER PEAKS Page 10
FORECASTLE Page 2
FORKLIFT TRUCKS (EMPTY & WITH LOAD) Page 7
FORTY-FOOT HIGH CUBE 9' 6" HEIGHT CONTAINER Page 9
FORTY-FOOT REEFER CONTAINER Page 9
FOUR-WAY PALLET Page 7
FULLY CELLULAR PANAMAX CONTAINER SHIP (PROFILE & PLAN) Page 17
GAS CARRIERS Page 21
GENERAL CARGO SHIP Pages 2, 3, 10 & 11)
GRAIN / BALE SPACE Page 6
HOLDS WITH GRAIN CARGO Page 4
ICEBREAKER BOW Page 4
IMDG CODE LABELS Page 16
LIFTING ARRANGEMENTS FOR 20' CONTAINER Page 8
LIGHTER ABOARD SHIP (LASH) (PROFILE & PLAN) Page 16
LNG CARGO TANKS Page 20
LNG CARRIER (PROFILE & PLAN) Page 21
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LONGITUDINAL SECTION OF A GENERAL CARGO SHIP Page 2

LPG CARRIER (PROFILE & PLAN) Page 21
MERCHANT SHIP ICEBREAKING BOW Page 4
MIDSHIP SECTION OF BULK CARRIER Page 11
MOBILE CRANE Page 7
MOBILE GANTRY Page 8
MOULDED & EXTREME DEPTH Page 6
MULTIPURPOSE GENERAL CARGO VESSEL (PROFILE & PLAN) Page 11
MUTUALLY OPERATED TWIST-LOCKS Page 8
OPEN TOP CONTAINER Page 9
ORE CARRIER (CROSS-SECTION) Page 13
ORE/BULK/OIL (OBO) CARRIER (CROSS & LONGITUDINAL SECTIONS) Page 13
ORE/BULK/OIL (OBO) CARRRIER (PROFILE & PLAN) Page 14
ORE/OIL CARRIER (PROFILE & PLAN) Page 15
ORE/OIL (O/O) CARRIER (CROSS & LONGITUDINAL SECTIONS) Page 14
OUTLINE CROSS-SECTION OF ORE CARRIER Page 13
OUTLINE MIDSHIP PROFILES OF LNG CARGO TANKS Page 20
OUTLINE OF A DOCK SHOWING SHIPS AT BERTHS Page 3
OUTLINE SECTION OF COMBINED ORE & OIL CARRIER Page 13
PANAMAX BULK CARRIER (PROFILE & PLAN) Page 12
POCKETS IN A CONTAINER Page 9
PORT, STARBOARD, ETC. (SHOWN IN SHIP'S PLAN) Page 3
POSITION OF DRAFT & LOADLINE MARKS Page 4
PRODUCTS CARRIER (PROFILE & PLAN) Page 19
PURE CAR CARRIER ARRANGEMENT Page 14
RAKED BOW Page 4
REEFER (REFRIGERATED) VESSEL Page 15
RORO VESSEL (PROFILE) Page 17
RORO RAMP Page 15
SAGGING & HOGGING Page 5
SHELTERDECK SHIP Page 2
SHIP ENTERING LOCK & LEAVING ENTRANCE FOR DOCK BERTH Page 4
SIDE LOADING NEWSPRINT IN A VESSEL Page 6
SINGLE FACE PALLET Page 7
SLEWING STERN RORO RAMP Page 15
SPREADER Page 7
STOWAGE PLAN Page 3
TANK CONTAINER Page 9
THE TANKER DEVELOPMENT (SHIP SIZES OVER THE YEARS) Page 18
THREE-ISLAND TYPE SHIP Page 2
THROAT OF A PALLET Page 7
TRANSVERSE SECTION OF A GENERAL CARGO SHIP Page 10
TRANSVERSE SPREADER Page 8
TWENTY-FOOT BULK CONTAINER FOR GRAIN, ETC Page 9
TWENTY-FOOT FOLDING-END FLAT RACK CONTAINER Page 9
TWENTY-FOOT GENERAL CARGO CONTAINER Page 9
TWIST-LOCKS Page 8
TWO-WAY PALLET Page 7
TYPES OF BOWS Page 4
TYPES OF PALLETS Page 7
TYPES OF SHIPS Page 10
TYPICAL ARRANGEMENT OF PURE CAR CARRIER Page 14
ULLAGE Page 5
UNIVERSAL BULK CARRIER Page 11
VLCC MT ESTELLE MAERSK (PLAN) Page 19

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