Liner operators quote
their freight rates on a liner term basis. A series of highly
specialised operations are required in the process of loading cargoes
efficiently into a ship, and securing those cargoes in the ship's hold for safe
transportation to the port of destination. Another series of equally highly
specialised operations must take place in order to extract the cargo from the
ship's hold and place them safely on the quayside at the port of destination.
All these costs are collectively known as terminal handling charges - THC.
Payment of freight
The word
"freight" has two alternative meanings: it may be used to refer to
the movement of the cargo; by road, rail sea or air, or it may be used to
denote the charge raised by the carrier for the service of transportation.
Freight currency
In the context of
international carriage by sea, the "tariff currency", is the United
States Dollar. It is common practice in the shipping industry that freight is
payable as the consignment/cargo is loaded on board the intended vessel.
Immediately the cargo
has been placed on board, the shipping company is entitled to full payment,
even though the ship may sink along the quayside at the loading berth. The
amount of freight due is paid either at the port of loading in exchange for the
issuance of the original bills of lading, or at the port of discharge in
exchange for the release of the consignment from the shipping company's
custody. When freight is paid in any currency other than the "tariff
currency", the amount due in that "tariff currency", will be converted
at the rate applicable on the date of shipment or such other date as agreed
upon by the carrier.
