Liner terms

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Liner terms
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Liner terms are the conditions under which shipping company will agree to transport goods. Liner terms usually include costs of loading, unloading, transport and discharge fee. Liner terms are from shipment company point of view.

Types of liner terms

The liner terms can be:

  • Free In Out (FIO)
  • Free In Liner Out (FILO)
  • Full Liner Terms (FLT)
  • Free In Out Stowed (FIOS)
  • Free In Out Trimmed (FIOT)
  • Free In Out Stowed Trimmed (FIOST)

Free In Out (FIO)

The time of transport or freight, which ends, that the costs of loading or unloading are not issued. In the context of a charter card, this means that loading / unloading is not the responsibility of the shipowner. The obligation to bear the costs of loading and unloading rests on the handle. Permission to access information about the ship.Fees for loading vary considerably depending on the port. With an FIO card, shipowners do not have to worry about the loading and unloading costs that freight forwarders and consignees have to bear. so they will not incur additional costs.

Free In Liner Out (FILO)

Includes transport and costs from unloading in accordance with the customs at port. The free unloading rate excludes loading costs and (if necessary) storage and fixing costs.

Full Liner Terms (FLT)

The FLT condition includes the freight price, which includes: land operations, on-board transshipments, fastening, detaching, security and auxiliary materials, all costs associated with reloading to the transport, along with the usual port charges/levies/taxes.

Free In Out Stowed (FIOS)

The costs of loading, unloading and reloading are costs borne by freight forwarders. For the costs associated with bringing the ship to the port, the costs of pilotage, tug etc. the ship is responsible and is responsible for bearing the costs. The forwarding agent should be carefully prepared transport plan, because if the ship exceeds the time that was planned, the stop will be an additional cost for the forwarding agent.

Free In Out Trimmed (FIOT)

Classification of freight rates, which information is included in the home port, but not for its unloading at the destination port. Here "free" means "not included" and not "inclusive". This is not Incoterm and can have different sizes in different countries.

Free In Out Stowed Trimmed (FIOST)

"Under a voyage charter, the ship provides transport for a specific cargo between a loading port and a discharging port at terms which specify a rate per carrying ton. In this case, the shipowner undertakes to carry a specific quantity of a particular commodity between two named ports at a fixed freight rate per ton (or other unit of cargo measurement).

The charterer charters whole or part of the carrying capacity of a vessel for the carriage of his cargo by sea. The charterer is obliged to provide the agreed cargo alongside the ship and pay extra for the cargo handling expenses (if “FIOST terms” are agreed at the charterparty). The charterer is also obliged to pay the stipulated amount of freight. All other costs (capital, operating and voyage costs) are for the shipowner's account" [1].

Examples of Liner terms

  • Freight Costs: A liner shipping company will usually charge a fee based on the volume and weight of goods being shipped. This fee may include the cost of loading, unloading, transport and discharge.
  • Liability: Liner shipping companies are liable for any loss or damage of goods while in their care. In the event of such an occurrence, the company may offer compensation or other damages to the affected party.
  • Delivery Times: Most liner shipping companies will provide a set delivery timeframe for a shipment. This will usually be based on the distance the goods need to travel and the type of goods being transported.
  • Insurance: Liner shipping companies may require that goods are insured during transit. This is to ensure that any losses or damages are covered in the event of an accident or other unforeseen circumstances.
  • Customs Clearance: Liner shipping companies may require that goods are cleared through customs before they are shipped. This is to ensure that goods are not unlawfully imported and that duties and taxes are paid where applicable.

Advantages of Liner terms

Liner terms offer various advantages for shippers and shipowners alike. These advantages include:

  • Cost Savings: Liner terms often work out cheaper than negotiated contracts, as the shipper does not have to pay for the additional costs associated with negotiating terms and securing a contract.
  • Flexibility: Liner terms provide shippers with the flexibility to choose different carriers for their goods, rather than being tied to a single carrier. This can help to ensure that a shipper has the most efficient and cost-effective supply chain.
  • Speed of Delivery: As the carrier has already accepted the liner terms, the shipper does not have to wait for the negotiating and contracting process to be completed. This can help to speed up the delivery process.
  • Reliability: By working with a reputable carrier, shippers can be assured of reliable and safe transport of their goods.
  • Standard Terms: Liner terms provide shippers with the assurance that they are using the same terms as other shippers, meaning they know what to expect and can provide accurate cost estimates.

Limitations of Liner terms

  • Liner terms have certain limitations that should be taken into consideration when engaging in a transaction. These include:
  • The cost of freight and other associated fees may be subject to change without prior notice, making budgeting difficult.
  • The shipping company may not be able to guarantee the delivery date, leading to delays and other problems.
  • In some cases, the shipping company may not be able to provide insurance for the goods, leaving them vulnerable to theft or damage during the transit.
  • The shipping company may not provide any additional services, such as warehousing and customs clearance, which can be time-consuming and costly.
  • The shipper may not have any control over the port of call, which can lead to unexpected delays.
  • The shipping company may not be able to accommodate special requests, such as temperature-controlled transport or hazardous goods.
  • The shipping company may not be able to provide reliable tracking and tracing services, which makes it difficult to monitor the progress of the shipment.

Other approaches related to Liner terms

  • Freight All Kinds (FAK) Terms: These terms allow for the transportation of a wide variety of goods, with the shipper paying the same set rate regardless of the size or type of goods being transported.
  • Direct Liner Terms: These terms allow for the transportation of goods directly from the port of origin to the port of destination with no need for transshipment.
  • Through bills of lading: This term allows for goods to be shipped from one port to another via multiple stops, with the shipment company taking responsibility for the goods throughout their journey.
  • Intermodal shipping terms: These terms allow for the goods to be transported over multiple modes of transportation, such as sea, road, and rail.

In summary, liner terms are the conditions under which a shipping company will agree to transport goods, and other approaches related to liner terms include Freight All Kinds (FAK) Terms, Direct Liner Terms, Through bills of lading and Intermodal shipping terms.

References

Footnotes

  1. ↑ Plomaritou E.

Author: Natalia Borowiec

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