Do You Know All These Surcharges For Ocean Transportation?

Due to various reasons for ships, cargoes, ports, and other aspects that make the shipping party increase expenses or suffer economic losses when transporting cargoes, the shipping party, in order to compensate for these expenses or losses, stipulates that another charge be collected, which is called a surcharge or additional charge. There are many kinds of surcharges, and with the change of circumstances, they will be canceled or a new surcharge formulated. There are many types of surcharges, and as some circumstances change, new surcharges may be canceled or established.

The following are some of the more commonly used ocean freight surcharges currently available:

• Combined Rate Increase (GRI)

Generally used on South American routes and U.S. routes Because of the port, ship, fuel, cargo, or other aspects of the various reasons, the shipping company's transportation costs increased significantly. The shipowner, in order to compensate for these increased expenditures, increased the comprehensive rate surcharge.

• Peak Season Surcharge（PSS)

This fee is generally in the peak season when the freight is busier; many shipping companies will take the excuse to charge, and our "Spring Festival" price increases are somewhat similar. April to November each year is generally the peak season for the world's freight.

• Emergency Bunker Surcharge (EBS)

EBS belongs to a surcharge of ocean freight, which is generally settled in US dollars like ocean freight. If it is FOB terms, this cost should be borne by the consignee, not the consignor, because EBS does not belong to FOB local costs. This cost can be paid on delivery or in advance.

• Terminal Handling Charge (THC)

It can be further divided into OTHC-Origin Terminal Handling Charge (OTHC) and DTHC-Destination Terminal Handling Charge (DTHC).

• Original Receiving Charge (ORC)

This fee is complex and is both different and related to the Terminal Handling Charge (THC), which is only available at ports in South China, mainly in Guangdong, and is available at all ports (including those in Guangdong). Only one of the two fees is charged; if ORC is charged, THC will not be charged. If THC is charged, ORC will not be charged. If THC is collected, ORC will not be collected.

 

The ORC is specifically for ocean routes from ports in South China with destinations in North America, Central and South America, Europe, and North Africa. Ports in South China to other destinations, such as Southeast Asia, are the same as other ports in other regions, and only THC is levied. 

• Port Congestion Surcharge (PCS)

When the port is congested or particularly busy, the waiting time and duration of the ship will be extended, and the cost of port calls, such as tugboat charges, may increase, resulting in a substantial increase in the cost of transportation. In order to make up for this loss of cost, the shipping company will charge the shipper a port congestion surcharge.

• Container Imbalance Charge (CIC)

Sometimes referred to as the Container Imbalance Surcharge, this is a surcharge added by shipping lines to cover the cost of transferring empty containers due to an imbalance in cargo flow or containers caused by an imbalance in trade volume or seasonal changes.

• Destination Delivery Charge (DDC) 

In DDU, DDP, and other terms, this cost is only the seller's or shipper's burden; otherwise, it is paid by the buyer or consignee. For example, in CIF terms, the buyer or consignee bears the goods in the port of shipment after crossing the ship's side of all the costs and risks, so all the costs of the port of destination, including DDC, are borne by the party or consignee. 

• Heavy-Lift Additiona (HLA)

Refers to the weight of a single piece of cargo exceeding a certain standard (different freight forwarders or shipowners may not have the same standard), the need for special equipment (such as heavy cranes) or special operations (such as the need for padding, reinforcing materials, and artificial lashing or reinforcing), the loading and unloading operations being more difficult, or the ship's accumulation of loads needing special treatment in order to make up for the increase in the cost of operation and the charging of a surcharge.

 

Generally, if the weight exceeds 2 tons, 3 tons, or 5 tons, it is considered overweight. The overweight surcharge is charged according to the weight; the higher the weight, the higher the surcharge, and if you have to transfer to another ship, you will be charged an additional surcharge for each transfer.

• Currency Adjustment Factor (CAF) 

Also known as CAS (Currency Adjustment Surcharge), when the currency in which the freight is to be charged is significantly devalued, the shipping company suffers a large loss due to currency devaluation. In order to compensate for the loss, the shipowner will pass on the loss to the shipper or cargo owner by adding a currency adjustment surcharge (CAS).

• Long Length Additional (LLA) 

Refers to the length of a single piece of cargo exceeding a certain standard (different freight forwarders or shipowners may not have the same standard), the need for special equipment or special operations, loading and unloading operations that are more difficult, or the ship's accumulation of loads that need to be specially handled in order to make up for the increase in operating costs and a surcharge.

Generally, more than 9 meters, even if the length, if the container cargo is generally stipulated, more than 6 meters, even if the length, the rate according to the length of the graded increment. 

• Emergency Cost Recovery Surcharge(ECRS)

It can also be called an "adverse weather operating surcharge," which is charged when bad weather conditions cause a significant increase in the transportation and operating costs of a vessel, etc.

• Container Service Charge (CSC) 
• Fuel Adjustment Factor (FAF)

Generally used on Japanese routes

• Entry Summary Declaration (ESD) 

Refers to the European Customs Advance Manifest Rule. Since January 1, 2011, the European Union (EU) has mandated the "Advance Manifest Rules" for all shipments to (all goods imported into the EU) or through (all goods in transit, all goods in transit, all unloaded goods on board, etc.) EU ports, which apply to all EU member states.

• Suez Canal Surcharge （SCS)

The routes from Asia, Oceania, and East Africa to Europe basically pass through the Suez Canal. When ships pass through the Suez Canal, shipping companies need to pay a certain amount of navigational expenses to the canal authorities, and this cost is collected by shipowners from their customers in the form of Suez Canal surcharges.

• Panama Canal Transit Fee (PTF) 

In the same way as the Suez Canal surcharge, the routes from the Far East and the west of the United States (referred to as the U.S. West) to the east of the U.S. (referred to as the U.S. East) generally pass through the Panama Canal, and when ships pass through the Panama Canal, the shipping company needs to pay a certain amount of navigational expenses to the canal authorities, and this cost is collected by the shipowner in the form of Panama Canal surcharges from the customer.

• Document (DOC)

In the forwarding industry, DOC has two charges: one is DOC charged by the shipping company, and the other is a fixed charge charged by RMB. The other one is DOC charged by the destination port, which is also considered one of the basic costs of the destination port, and the agent of the destination port charges it according to US dollars, and each agent charges it differently.

• Automatic Manifest System (AMS) 

Used for U.S.-Canada routes, U.S.-specific: all cargo to the U.S. or transiting through the U.S. to other countries or regions is required to make an AMS declaration (24 hours prior to loading). AMS is also known as the 24-Hour Manifest System or the U.S. Anti-Terrorism Manifest System.

• Temporary Additional Risks (TAR)
• Advance Commercial Information (ACI) 

Canadian Customs regulations require that all goods arriving in Canada or transiting through Canada to other countries must be declared to Canadian Customs 24 hours prior to loading on board a ship, much like the AMS in the United States.

•  General Rate Increase (GRI)

Generally used on South American routes and U.S. routes Because of the port, ship, fuel, cargo, or other aspects of the various reasons, the shipping company's transportation costs increased significantly. The shipowner, in order to compensate for these increased expenditures, increased the comprehensive rate surcharge.

• Cleaning Charge（CC)
• Bunker Surcharge or Bunker Adjustment Factor (BAF)
• Transhipment Surcharge

Where goods destined for a non-basic port are required to be transferred to a destination port, a surcharge is levied by the vessel, which includes a transfer fee and a two-way freight charge.

• Direct Additional

 A surcharge is added when cargo to a non-basic port reaches a certain volume and the shipping company can arrange a direct voyage to that port without transhipment.

• Port Additional or Port Surcharge

Surcharges imposed by shipping lines in some ports are due to poor equipment or inefficient loading and unloading, as well as other reasons.

• Deviation Surcharge

A surcharge is imposed by a ship when the ship must make a detour to get its cargo to the port of destination because the normal shipping lanes are blocked and impassable.

• Alternational of Destination Charge

A surcharge is imposed when the owner of the goods requests a change in the original port of destination of the goods and the relevant authorities (e.g., Customs) authorize it and the ship agrees to it.