Views: 108 Author: Site Editor Publish Time: 2022-03-22 Origin: Site
If you are not familiar with international ocean freight, you may be confused about the service providers for cargo transportation. For example, what's the difference between NVOCC and freight forwarder? How do you know which company to contact when you have cargo to arrange? Here is a brief introduction.
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NVOCC is an OTI classified by the Federal Maritime Commission (FMC). it works by transporting cargo from one place to another. It is called "carrier-to-shipper" and "shipper-to-carrier". This means that NVOCCs enter into volume-based ocean freight arrangements with many shipping companies across trade routes. NVOCCs provide an agent at the port of loading and the port of discharge. This agent handles the requirements for releasing cargo and containers to various customers.
The NVOCC is a cargo consolidator that legally acts as a carrier. There are so many drones in the U.S., but the U.S. has the highest number of drones in the world. Customers of NVOCCs include BCOs (Beneficial Cargo Owners), freight forwarders, clearing agents and freight brokers.
Freight forwarder (FF) is an OTI, known to be an agent for shippers. It is part of the International Federation of Freight Forwarders Associations. It handles cargo for importers or exporters by providing expert advice and consultancy services. The role of a freight forwarder is to move cargo between seaports, airports and warehouses. It is responsible for arranging the transfer of goods to international destinations or from one location to another.
A suitable freight forwarder must have experience in various modes of transportation. These modes of transportation can be road, sea, rail and express. it is competent enough to provide reliable and efficient freight solutions. It must know how to arrange and store cargo. A freight forwarder can arrange freight forwarding or freight forwarding according to the customer's requirements.
From the perspective of the development of maritime transport, NVOCC and international freight forwarders have a very close relationship. NVOCC is the evolution of international freight forwarders from the intermediary of the contract of carriage to the process of the main body of the contract of carriage, NVOCC is the extension and development of freight forwarding business. However, the NVOCC and international freight forwarders and there are fundamental differences between.
From the two and the shipper and the consignee's relationship, NVOCC and the shipper is the relationship between the trustee, and the consignee is the bill of lading issuer and holder of the relationship, while the international freight forwarder and the shipper is entrusted with the relationship between the entrusted party and the consignee does not exist between any relationship. From the issuance of documents, NVOCC issues bills of lading, as proof of title, and freight forwarders generally for freight forwarding transport documents, as proof of transport.
The general tasks of freight forwarders/ NVOCCs are booking, organizing cargo transportation, negotiating contract rates with various carriers, consulting, preparing and processing relevant shipping documents.NVOCCs are also responsible for organizing shipments and signing contracts with shipping companies and carriers to ensure that a specific number of containers can be shipped each year. On the other hand, shipping companies as carriers offer better rates to these companies.
It is worth mentioning that NVOCC issues its own House Bill of Lading; however, freight forwarders issue bills of lading on a standardized basis based on FIATA documents. In addition, freight forwarders are not allowed to add any profit on top of the container or vessel space; instead, they can only charge surcharges, service fees and handling charges. In view of working with a responsible agent, a freight forwarding agreement is a good option.
· Entering into an international cargo carrier contract with the shipper as a carrier.
· Delivery and receipt of goods as a carrier.
· Issuing various transport documents and shipping orders.
· Handling booking of space as well as transportation by mainline carriers.
· Arranging port-to-port transportation charges as well as other basic charges.
· Consolidation and splitting of containers using 3rd party services or through CFS.
List of activities controlled and managed by freight forwarder：
· They arrange cargo transportation for international destinations.
· Responsible for shipments from the United States through common carriers; can also arrange the necessary space for the cargo through the shipper. Make the liability insurance of freight forwarders vital responsibility.
· They process and prepare documents related to all shipment activities.
NVOCC license
There is no doubt that the United States is the largest importer in the world. However, all NVOCC and freight forwarding companies in the United States are required to apply for an Ocean Transportation Intermediary (OTI) license. The Federal Maritime Commission (FMC) is responsible for issuing licenses to companies that qualify.
Types of licenses：
There are three types of licenses that can be applied for to begin shipping in the United States
· OTI-NVOCC License: The first option is the OTI-NVOCC license, which allows carriers to issue their own bills of lading, establish variable sales rates for cargo, and purchase basic transportation services from carriers.
· OTI-OFF License: Carriers with an OFF (Ocean Freight Forwarder) license cannot perform all activities allowed under the OTI-NVOCC license. However, they may receive commissions allocated by the carrier while providing documentation and transportation to the parties involved.
· OTI-NVOCC and Freight Forwarder Permits: Such permit holders are eligible to operate as NVOCCs or freight forwarders. However, it is worth mentioning that FMC does not allow any company to operate as both NVOCC and freight forwarder.
NVOCC is responsible for issuing the bill of lading to the end customer. Please note that the shipper listed on the bill of lading is retained as the actual exporter or shipper of that particular shipment.
· The shipper acts as the actual exporter or shipper of the goods.
· The consignee is the actual importer or receiver of the goods.
· Since the transfer is done by license, the consignee may also act as the notifying party.
After the NVOCC receives the goods from the named shipper; it issues the House Bill of Lading considering that all customs paperwork has been completed. the major difference between NVOCC and Freight Forwarder is that a licensed NVOCC can issue its own House Bill of Lading.
Once you understand the difference between NVOCC and a freight forwarder, it's easy to choose which type of company you need to provide ocean freight services. The solution is to partner with NVOCC, whose portfolio includes a full range of freight forwarding services. Then, you get the best of both worlds. You'll get a company that can.
· View a range of available sailings on multiple liner routes
· Provide you with competitive rates
· Issue your own bills of lading
· Arrange reliable ground transportation
· Provide any other logistic services you need
To partner with NVOCC, which offers all the logistics services needed for successful door-to-door shipping, contact the experts at STU Supply Chain.
