Thursday, September 11, 2014

TRANSHIPMENT VS CARGO IN TRANSIT

Difference between transhipment and cargo in transit..

What is the difference between Transhipment and Cargo in Transit..??

image for ts vslThis article is based on a question from a user Krishna..
What is Transhipment..??Transhipment is the act of off-loading a container from one ship (generally at a hub port) and loading it onto another ship to be further carried to the final port of discharge..

How is this different from Cargo in Transit..??
A cargo that is moved from an origin point across international borders to another country over land is termed as “Cargo in Transit”..
Let me explain further..
There are several countries and commercial centers around the world that don’t have a seaport and these countries have to use the seaports of other countries in order to import or export their cargo..
Some examples of such countries would be
  • Ethiopia which uses the port of Djibouti in Djibouti as their gateway port
  • Uganda which uses the port of Mombasa in Kenya as their gateway port
  • Moldova which uses the port of Constanta in Romania as their gateway port
Image for transitCargo in Transit move could be as below :
  1. Cargo from Country A is moved to destination Country D via Country B (which could be a sea port) and Country C (another inland country) or
  2. Cargo from Country A is moved to destination Country D overland, via countries B and C where Countries A, B, C and D are all within a union of countries like the EU
Bills of Lading and Manifest for cargoes bound for such inland country destinations, must carry the clause Cargo in transit to “name of country” .. This clause tells the gateway/transit port/country that the cargo is not meant for consumption in their country and is meant for the manifested inland country and by virtue of this clause, the cargo maybe allowed to transit international borders under customs control..
If this clause is not included in the bill of lading and manifest, the movement across the international border will not be allowed and the recipient might need to customs clear the goods at the gateway port which might not be an ideal situation for the recipient..
In some cases, shipping lines or government regulations might dictate/insist that the clause reads as “Cargo in transit to “name of country or final destination” on client care, risk and cost“..
Cargoes in transit may be moved via any mode of transportation depending on the infrastructure available..
The documentation and customs clearance processes between the countries depend on their trade and other co-operation agreements.. Unions and Communities such as EU and SADC have agreements for cargoes moving in transit within/via their territories..
To summarize :
*** Transhipment is the act of off-loading a container from one ship (generally at a hub port) and loading it onto another ship to be further carried to the final port of discharge.. Cargoes that have been off-loaded at a port for transhipment are NOT allowed to exit the port by land or rail across international borders to a land locked country unless they are declared as Cargo in Transit..
*** Cargo in Transit is the movement of cargo that is
  1. discharged at a gateway seaport or
  2. originating from a country within a union
across international borders to another country where the final destination is (generally) a landlocked country..