Who pays what charges for a shipment..??
This is one of the big questions in the minds of a lot of newcomers to the business of exporting and importing..
As far as the shipping line is concerned, in general, the person placing the booking with the shipping line is responsible and liable to pay all or some of the costs.. This could be the direct shipper or consignee or their agent(s)..
However, depending on the type of order and Incoterms® used, there will be cases where the orders are placed differently and there might be a couple of agents involved..
Agent A might pay all charges upto say FCA Durban (load port).. Agent B would then pay all charges from FCA Durban to destination..
When I say charges upto FCA Durban is paid by Agent A..?? FCA stands for Free Carrier.. Under FCA rules, the Seller should deliver the goods, cleared for export, to the carrier selected by the Buyer..
If the buyer decides to book the shipment on carrier haulage basis, then the carrier will pick up the cargo at the seller’s premises and the seller’s responsibility will then cease on the goods are loaded into the container.. From that point on, the Buyer bears the costs and risks of moving the goods to destination..
All charges upto FCA Durban would involve all charges from packing the cargo into the container, any inspection charges, customs clearance, cargo dues (wharfage), other documentation charges, weighment charges (if applicable), transportation to the port, THC at the load port..
Agent B would pay the ocean freight, BAF, CAF, ISPS, haz surcharge (where applicable) and any other charges related to the carriage of the cargo on board the ship, because his liability starts from the moment the cargo has crossed the ships rail and is on board the ship..
The shipping line will release the bill of lading to the legal owner of the cargo or the shipper or the company that placed the booking with them only after all their charges are paid to them by 1 or more agent(s)..