Why start with the parties?
On its way from the seller's warehouse to the buyer's, a load often passes through the hands of ten different companies. When something goes wrong, the first question is always the same: who is liable to whom, under which contract? Answering it starts with knowing each party's role and the documents between them.
We look at the parties in three groups: the trading parties (who buy and sell the goods), the transport parties (who carry the goods or organise the carriage) and the support services (customs, banks, insurance, surveyors).
Map of the parties
Click a party to see its role, who it contracts with and which documents it issues. The map shows a typical containerised export by sea.
Country of origin
Transport
Country of destination
Support services
All parties (table)
| Party | Role | Contracts with | Documents |
|---|---|---|---|
| Seller / shipper | Sells the goods and (under the C and D rules) makes the contract of carriage. Appears as shipper on the bill of lading. | Buyer (sales contract), forwarder or carrier (contract of carriage) | Commercial invoice, packing list, shipping instructions, VGM |
| Customs broker (origin) | Files the export declaration on the shipper's behalf. | Shipper (agency agreement) | Export declaration |
| Road haulier (pre-carriage) | Collects the empty container from the depot, brings it to the loading point and delivers the full container to the terminal. | Forwarder or carrier (merchant / carrier haulage) | Waybill / CMR note |
| Freight forwarder | Organises the transport: books space, prepares documents, coordinates trucking, customs and insurance. If it issues its own bill of lading it may be liable as a carrier. | Shipper or buyer (customer); shipping line (space purchase) | House B/L (HBL), FBL, booking confirmation |
| NVOCC | Acts as a carrier without operating ships; buys space from shipping lines and issues its own bill of lading. | Customer and shipping line | House B/L |
| Shipping line / carrier | Operates the vessel and carries the cargo from port to port. | The shipper on the bill of lading (often the forwarder) | Master B/L (MBL), sea waybill, arrival notice |
| Shipping agent | Represents the carrier in port; handles bookings, bills of lading, delivery orders and port formalities. | Carrier (agency agreement) | Bill of lading (on behalf of the carrier), delivery order |
| Terminal operator | Loads, discharges and stores containers; charges storage. | Carrier (handling); cargo owner (storage) | Gate-in / gate-out (EIR) records |
| Buyer / consignee | Buys the goods and takes delivery at destination. Makes the contract of carriage under the F rules. | Seller (sales contract) | L/C application, import documents |
| Notify party | The party the carrier informs on arrival. Has no right to take delivery. | — | Receives the arrival notice |
| Customs broker (destination) | Files the import declaration for the buyer, pays duties and clears the cargo. | Buyer | Import declaration |
| Banks | Examine documents and handle payment in letters of credit and documentary collections. | Buyer (issuing bank), seller (beneficiary) | Letter of credit, payment instruction |
| Insurer and surveyor | The insurer issues the policy and pays claims; the surveyor establishes the cause and amount of the loss. | The insured (seller or buyer) | Insurance policy / certificate, survey report |
The trading parties
- Shipper: The party that hands the cargo to the carrier under the contract of carriage. Usually the exporter, but not always; in an EXW sale, for example, the buyer's forwarder may appear as shipper on the bill of lading.
- Consignee: The party entitled to take delivery at destination. In letter of credit transactions the bill of lading is often made out to a bank's order, which then has to endorse it.
- Notify party: The party the carrier informs when the cargo arrives. It is only informed; it has no right to take delivery.
The parties to the sales contract (seller and buyer) and the parties to the contract of carriage (shipper and carrier) do not have to be the same people. The Incoterms rule decides who makes the contract of carriage: the buyer under the F rules, the seller under the C and D rules.
The transport parties
Carrier / shipowner: The company that operates the vessel and physically carries the cargo. Companies running scheduled container services are called liner carriers. The carrier issues its own bill of lading, the master B/L (MBL).
Freight forwarder: Organises the transport on the customer's behalf. It chooses the carrier, books space, prepares documents and coordinates trucking, customs and insurance from a single point. When a forwarder issues a bill of lading in its own name (house B/L, HBL), it can take on carrier-like liability towards its customer.
NVOCC (Non-Vessel Operating Common Carrier): Acts as a carrier without operating ships. It buys space from shipping lines and gives its customers its own bill of lading. The term comes from US regulation; in practice many forwarders are also NVOCCs.
Shipping agent: Represents the carrier in a port. It handles bookings, issues bills of lading and delivery orders and manages port formalities.
Terminal operator and stevedores: Load containers onto vessels, discharge them and store them at the terminal. The terminal operator charges storage.
Road and rail carriers: Bring the container to the port (pre-carriage) and take it from the port to the consignee (on-carriage).
Support services
- Customs broker: A licensed professional who files customs declarations on behalf of the declarant. In Türkiye, customs brokers are authorised by the Ministry of Trade; a company may file its own declarations, but in practice most work with a customs broker.
- Banks: Examine documents and handle payment in letters of credit and documentary collections.
- Insurer: Issues the cargo insurance policy, pays the claim when there is a loss and then recovers from the carrier.
- Surveyor: Establishes the cause and amount of a loss; may also carry out pre-shipment inspections.
3PL and 4PL
A 3PL (third-party logistics) provider carries out logistics services such as warehousing, distribution and transport on a customer's behalf. A 4PL coordinates the whole supply chain for a customer, managing several 3PLs and carriers, usually without assets of its own. These terms are not defined identically across the industry, so the scope should always be written into the quotation and contract.
Test yourself
- A forwarder issued its own bill of lading to its customer, and the cargo was damaged in transit. Who does the customer claim against first? (Answer: The forwarder that issued the bill of lading. The forwarder then claims against the shipping line under its own contract.)
- Can the notify party take delivery of the cargo? (Answer: No. The notify party is only informed; the right to take delivery belongs to the consignee or the lawful holder of the bill of lading.)
- Who makes the contract of carriage in an FOB sale? (Answer: The buyer. Under the F rules the buyer arranges and pays for the main carriage.)