Difference between Pre-Carriage, Carriage and On-Carriage

rq

In one of my previous articles I had discussed the difference between Pre-Carriage & On-Carriage.. Today i received a question asking what is the difference between “Main Carriage” and “On Carriage”..

This is from someone new to the shipping industry.. Since this site is dedicated to assisting newcomers to the industry to learn about shipping and ask questions such as these, I am reproducing an updated version of the previous article..

A simple description would be

  • Pre-Carriage – The movement that happens BEFORE the container is loaded on the ship
  • Carriage – The movement that happens while the container is ON BOARD the ship
  • On-Carriage – The movement that happens AFTER the container is discharged from the ship 

To explain further :

Pre-Carriage – is the term given to any inland movement that takes place prior to the container being loaded at a port of loading.. Such activity can take place at the same location as the port of loading, or at a location close to the port of loading.. Example : Empty container is released in Johannesburg and moved to Pretoria for packing and then moved by road or rail to Durban port.. This activity is known as PRE-CARRIAGE..

If the activity is performed by the shipping line on behalf of the client, that is called Carrier Haulage..  In this case, normally the bill of lading shows place of origin as Pretoria.. If the activity is performed by the client or their transporter, that is called Merchant Haulage.. This activity can be performed using rail, or road transport..

flowdraw

Carriage – is the term given to the actual movement of the cargo on sea from the port of load to the port of discharge.. Example : When the container is moved from Durban to say Felixstowe by sea.. This activity is known as CARRIAGE..

This activity can be performed only by the shipping line/vessel operator who is undertaking to carry the cargo from point A to point B and the bill of lading issued by the ship owner/shipping line is the evidence of the contract of such carriage..

On-Carriage – is the term given to any inland movement that takes place after the container is discharged at a port of discharge.. Such activity can take place at the same location as the port of discharge, or at a location close to the port of discharge.. Example : Full container is discharged at Durban and then moved by rail to Johannesburg City Deep terminal and then further moved by road to Sasolburg for unpacking.. This activity is known as ON-CARRIAGE..

If the activity is performed by the shipping line on behalf of the client, that is called Carrier Haulage.. In this case, normally the bill of lading shows final destination as Sasolburg.. If the activity is performed by the client or their transporter, that is called Merchant Haulage.. This activity can be performed using rail or road transport..

What did you think of the above article..?? Comment below..

15 comments on “Difference between Pre-Carriage, Carriage and On-Carriage

  1. Htet Ko Zin says:

    Thanks a lot, sir!

  2. Ben Dalao says:

    does carriage and main carriage have the same meaning? or almost the same? please advise.

    1. Hi Ben, carriage means main carriage..

  3. Hariesh,

    Of course there can be, and usually is, more than one contract that applies to the international shipment of goods. Each contract sets forth the terms each party to the sale, purchase and movement of goods are willing to deal, and specifies their rights, duties and liabilities.

    But do not miscontstrue the term “risk” and where and to whom and when it transfers. Total and unconditional “risk” for the goods never transfers to a shipping line. That ultimate risk is borne by either the seller or the buyer. The transfer of that total risk depends upon the Incoterms® 2010 rule the seller and the buyer agree on in their sale contract. The Incoterms® 2010 rule is normally not reflected on a bill of lading, nor is it reflected in the contract of carriage with the shipping line.

    Note that the MSL Standard Terms and Conditions (STC)you referenced says that the contract of carriage is governed by the Hague Rules or the Hague-Visby Rules, which are incorported into the STC.

    The shipping line is only responsible for its own acts of negligence, not for the overall safe keeping of the goods.That is why a seller or a buyer, or both, depending upon the chosen Incoterms® 2010 rule, is well advised to insure the goods against loss or damage. There may be instances where the goods are damaged at any point in their journey, and yet the carrier is not responsible.

  4. Johne says:

    The designation of “Pre-Carriage, Carriage, and On-Carriage” are merely terms that designate the point at which the shipment is at any given time. Those terms have nothing to do with either point of designated delivery, or point of designated transfer of risk

  5. helen says:

    i have the following situation :
    I buy from a supplier in germany ex works in containers. i am reselling the cargo to a buyer in dubai on cfr basis.the buyer in dubai has an insurance based “from port to port”.
    i understand the situation as follows :
    the transport of goods from the premisses of supplier in germany to the port (in this case antewerp) is not insured. I have asked an insurance company to get an insurance from ex works to the port. the answer was no, as they give insurance for the whole voyage. but final receiver is ensuring goods from port to port. what solution can be found?
    Helen

    1. Hi Helen, there are several articles relating to EXW Incoterms® in this site.. You can do a search for EXW on the blog which will give you all the articles that talk about EXW.. Or you can click here.. http://shippingandfreightresource.com/?s=exw&submit=Search..

      There is a specific article discussing whether Incoterms® EXW rules suitable for international trade..??

  6. Mahesh says:

    Hi!

    Thanks David, your response is very informative.

    In fact what I should have mentioned earlier regarding the difference in the cargo clauses available for multimodal transport and not only as normally sought after marine insurance.

    How do we ensure complete insurance for cargo under multimodal transport? The loading / unloading and road, rail and sea transports involved expose the cargo to different nature of risks at each stage.

    With regards,

    Mahesh

    1. You can’t jump into insurance until you know which Incoterm rule you will be using. Transfer of risk is a key element in who is responsible for loss, the seller or the buyer. Are you a manufacturer? Are you an importer? Are you a freight forwarder?

  7. Mahesh says:

    Hi!

    I am tempted to expand the discussion a little further in light of the problem brought to this blog a couple of days back by an importer from Nepal whose cargo had been entrusted to a freight forwarder under ‘EXW’ term from the exporter.

    When such a cargo is handled by multimodal transport how do we distinguish between pre-carriage, carriage or on-carriage?

    Does insurance cover make any such difference regards the risks the cargo is exposed?

    With Regards

    Mahesh

    1. The designation of “Pre-Carriage, Carriage, and On-Carriage” are merely terms that designate the point at which the shipment is at any given time. Those terms have nothing to do with either point of designated delivery, or point of designated transfer of risk. These are both determined by the designation of an appropriate Incoterms® 2010 rule in the sales contract, and which determines between the seller and buyer when delivery and transfer of risk will occur.

      Regarding insurance coverage; transfer of liability and risk are defined in the chosen Incoterms® 2010 rule. The decision of a seller or a buyer to insure or not to insure the goods will be determined by what Incoterms® 2010 rule is chosen.

      I assume you are familiar with Incoterms® 2010. If not, and if you are in any way involved with the international shipping of goods, I suggest you Google the International Chamber of Commerce (ICC) or go to http://www.iccbooks.com/Product/CategoryInfo.aspx?cid=144 and purchase a copy of the Incoterms 2010® book. This should answer your questions in detail.

      Or refer to a synopsis of the Incoterms 2010® rules on the many web sites that offer free, but misleading and incomplete, charts as to how to generally interpret and apply the Incoterms 2010® rules. Relying on these, without reference to the actual underlying Incoterms 2010® rules can be very dangerous.

      Caveat . . . . the synopsis and the Internet charts are NOT the Incoterms 2010® rules. The actual rules are much more detailed. Without a complete copy of the actual rules, anyone venturing into a shipping agreement is flying blind.

      See also: http://export.gov/faq/eg_main_023922.asp
      See also: http://en.wikipedia.org/wiki/Incoterms

    2. Hi David and John – these terms do have relevance in terms of transfer of risk or point of delivery in the view point of a shipping line and the contract of carriage.. That is why they are shown on the Combined Transport bills of lading issued where there are specific fields showing PLACE OF RECEIPT and PLACE OF DELIVERY..

      The move from Place of Receipt to Port of Loading is called Pre-Carriage and the move from Port of Discharge to Place of Delivery is called On-Carriage and by updating information in these two fields when issuing a Combined Transport Bill of Lading, the shipping line undertakes this movement which means they also undertake the associated risks either directly or via their 3rd party contractors and this will be determined by their bill of lading terms and conditions..

      As an example you can read Section 5 of MSC’s bill of lading terms and conditions

      A seafreight shipment could be governed by two contracts :

      1) The commercial contract between the Seller and the Buyer governed by the Incoterms®
      2) The contract of carriage between the seller or buyer and the shipping line governed by COGSA and the bill of lading is the evidence of such contract

      A shipping line is not interested in the commercial contract between the seller and the buyer.. They are guided by the contract of carriage that is entered into between themselves and the booking party, whether it is the seller or the buyer.. Who books this cargo/controls the shipment will depend on the Incoterms®..

  8. To enlarge the image, all you have to do is right click it and then click on “Save Image As” . . . .save it to a file and open it with your photo program. You can then make it as large as you want.

  9. Dan says:

    I really enjoy your site. I am glade I stumbled across it a few months ago. IS it possible to make it so you can click on the images ie. that nice diagram you have there so it will expand to a larger image??

  10. Clive says:

    Hi Hariesh
    As always a topical and entertaining blog
    If I may expand please …PC and OC may also be conducted by SEA where the
    Mother / Ocean Vessel may not call directly at origin and destination ports .
    East London ZA and Walvis Bay NA may be good examples having in the past being served regularly by local feeder operator Unicorn / OACL either via Durban or Cape Town (and vice versa).
    An ocean liner serving UK may only call directly at Tilbury and then offer a feeder service to / from Felixstowe …and vice versa

(Estimated reading time: 2 minutes)
You may also like :