| Acceptance | This is a term that is used in export contracts and implies that the buyer agrees to purchase goods at a stated specific price and according to stated specific terms. This term has several related meanings: (1) A time draft (or bill of exchange) that the drawee has accepted and is unconditionally obligated to pay at maturity. The draft must be presented first for acceptance – the drawee becomes the “acceptor” – then for payment. The word “accepted” and the date and place of payment must be written on the face of the draft. (2) The drawee’s act in receiving a draft and thus entering into the obligation to pay its value at maturity. (3) Broadly speaking, any agreement to purchase goods under specified terms. An agreement to purchase goods at a stated price and under stated terms. |
| Acceptance credit | A documentary credit which requires the beneficiary to draw a usance bill for subsequent acceptance by the issuing bank or the advising bank or any other bank as the credit stipulates – see Documentary Credits. |
| Accession | The process by which a country becomes a member of an international agreement (e.g. the GATT). |
| Accommodation Bill | In the context of fraud, a bill drawn without a genuine underlying commercial transaction. |
| Accountee | Another name for the applicant/opener of a documentary credit i.e. the importer = the person for whose account the transaction is made. |
| Actual Total Loss | Marine insurance term; a ship is usually considered an actual total loss for insurance purposes when it has been listed as missing. |
| Ad Hoc Charter | A one-off charter operated at the whim of the airline or charterer. |
| Ad Valorem | A Latin phrase, meaning “according to value”. An ad valorem duty is an import duty based on the value of an article as defined in the customs law of a particular country, rather than on weight or volume. A percentage of that value is charged, for example 5% ad valorem. A freight rate set at a certain percentage of the value of an article is known as an ad valorem rate. (See Ad Valorem duty) |
| Ad Valorem Rate | Rate determined according to the value of the imported merchandise as opposed to the weight or other basis for calculation. An ad valorem tariff is a tariff calculated as a percentage of the value of the goods when clearing customs. |
| Added-value processes/services | Additional processes/services that increase the value of a product or service. |
| Advance Against Documents | A loan made on the security of the documents covering the shipment. An alternative to acceptance financing. |
| Advice Of Fate | The Collecting Bank informs the Remitting Bank of non- payment/non-acceptance or (for D/A bills) of acceptance and the bill maturity date |
| Advising | Act of conveying the terms and conditions of a DC to the beneficiary. The advising bank is the issuing bank agent, usually located in the beneficiary country – see Export – DC Advising. Advising also involves authentication i.e. advising bank should take reasonable care to check the apparent authenticity of the credit (ICC UCC 500 Art 7). |
| Advising Bank | A bank, operating in the exporter’s country, that handles letters of credit for a foreign bank by notifying the export firm that the credit has been opened in its favour. The advising bank fully informs the exporter of the conditions of the letter of credit without necessarily bearing responsibility for payment. |
| Advisory Capacity | A term indicating that shipper’s agent or representative is not empowered to make definitive decisions or adjustments without approval of the group or individual represented. |
| Affreightment, Contract Of | An agreement between a shipping company and an importer or exporter for cargo space on a vessel at a specified time for a specified price. The importer/exporter is liable for payment whether or not the shipment is made at the time agreed upon. |
| Aframax | An Aframax ship is an oil tanker with capacity between 75 000 and 120 000 deadweight tonnage. Aframax tankers are mostly employed in the intra-regional trade of the North Sea, the Caribbean, the Far East and the Mediterranean. The term is based on the Average Freight Rate Assessment (AFRA) tanker rate system.Source |
| After Date (A/D) | Payment on a draft or other negotiable instrument due a specified number of days after the date the draft is presented to the payee. |
| After Sight (A/S) | Payment on a draft or other negotiable instrument due upon presentation or demand to the payee. |
| Air Cargo Agent | A type of freight forwarder who specialises in air cargo and acts for airlines that pay him a fee. The person may be registered with the International Air Transport Association, IATA (See also Air Freight Forwarder; Forwarder, Freight Forwarder, Foreign Freight Forwarder). |
| Air Freight Forwarder | A type of freight forwarder who specializes in air cargo. He usually consolidates the air shipments of various exporters, charging them for actual weight and deriving his profit by paying the airline the lower consolidated rate. He issues his own air waybills to the exporters, is licensed by the CAB (Civil Aeronautics Board) and has the status of an indirect air carrier (See also Air Cargo Agent, Forwarder, Freight Forwarder, Foreign Freight Forwarder.) |
| Airway Bill | A non-negotiable contract for carriage of air transportation between an air carrier and a shipper, or an air carrier and an air freight forwarder. In the latter case the forwarder, as an indirect air carrier, issues his own house air waybill to the shipper. |
| All-Risk Clause | An insurance clause providing that all loss or damage to goods is insured except that caused by the shipper (referred to as inherent vice). |
| AITA | The German/French acronym for International Air Transport Association, IATA. |
| All-Risk Insurance | A clause included in marine insurance policies to cover loss and damage from external causes, such as fire, collision, pilferage, etc. but not against innate flaws in the goods, such as decay, germination, nor against faulty packaging or loss of market, nor against war, strikes, riots and civil commotions (See Marine Insurance). |
| Alongside | A phrase referring to the side of a ship. Goods to be delivered “alongside” are to be placed on the dock or barge within reach of the transport ship’s tackle so that they can be loaded aboard the ship. |
| Alteration | A change in the boundaries of an activated zone or subzone. |
| Amendment | Alteration to the terms of a DC; amendments must stem from the applicant, be issued and advised to the beneficiary; the beneficiary has the right to refuse an amendment if the credit is irrevocable – see Amendments to DCs. |
| Anti-Dumping Duty | A tariff imposed to discourage the under-priced (below foreign countries domestic market) sale of foreign goods in the U.S. market. |
| Applicant | One who applies to his bank to issue a documentary credit; in the majority of credits issued the applicant is an importer of goods. |
| Arbitrage | The process of buying foreign exchange, stocks, bonds, and other commodities in one market and immediately selling them in another market at higher prices. |
| Arbitration Clause | A clause in a contract detailing how any contract disputes will be settled. |
| Asian Dollars | U.S. dollars deposited in Asia and the Pacific Basin. |
| Asia-Pacific Economic Cooperation (APEC) | An organization to promote open trade and practical economic cooperation in the Asia-Pacific region. It also aims to advancing Asia-Pacific economic dynamism and sense of community. |
| Association Of Southeast Asian Nations (ASEAN) | An economic cooperation. Members countries include Thailand, Japan, Vietnam, Indonesia, Malaysia, Singapore, Philippines, and Brunei. The ASEAN Alliance for Mutual Growth (AMG) is a multilateral initiative to encourage mutually beneficial trade relations between the United States and the ASEAN countries. |
| ATA Carnet | See Carnet. |
| Attributive Basis | Method of accounting for merchandise where direct identification of the goods with the shipment as admitted to the zone has been lost. |
| Audit-Inspection | Procedures provide the framework for Customs to reduce on-site supervision of zones and for zone operators/users to increase zone operating flexibility through the method of supervising zones. |
| Avalise | The act by a bank in guaranteeing payment of a bill of exchange or promissory note by endorsing the reverse with the words good per aval and signed by the bank, or by the issuance of a separate guarantee. |
