Detailed Overview of 27 Ocean Freight Surcharges

Have you ever been confused by surcharges like CIC, ECRS, GRI, or CISF? Here is a comprehensive guide to 27 common shipping surcharges to help you navigate the complexities of ocean freight.

01. Emergency Bunker Surcharge (EBS)

The Emergency Bunker Surcharge (EBS) is an additional fee charged when international crude oil prices rise rapidly, increasing shipping costs significantly. Typically billed in USD, EBS is either prepaid or collected upon delivery and is applicable mainly when carriers cannot promptly adjust base freight rates.

02. Container Imbalance Charge (CIC)

The Container Imbalance Charge (CIC) compensates for the cost of repositioning empty containers due to trade imbalances or seasonal fluctuations. For instance, export-heavy regions like China often require the return of empty containers from import-light regions, leading to this surcharge.

03. Emergency Cost Recovery Surcharge (ECRS)

The Emergency Cost Recovery Surcharge (ECRS) is imposed under extraordinary circumstances, such as adverse weather conditions, which significantly increase operational costs. This surcharge lacks a standardized definition and varies between carriers and shipping agreements.

04. Suez Canal Surcharge (SCS)

The Suez Canal Surcharge (SCS) is applied to cover transit fees incurred by vessels passing through the Suez Canal, a critical route for trade between Asia, Oceania, and Europe.

05. Panama Canal Transit Fee (PTF)

The Panama Canal Transit Fee (PTF) offsets the cost of navigating the Panama Canal, commonly used for routes between the Far East and the U.S. East Coast. It is similar in principle to the Suez Canal Surcharge.

06. Peak Season Surcharge (PSS)

The Peak Season Surcharge (PSS) is levied during high-demand periods, typically between April and November, when shipping volumes surge globally.

07. Port Congestion Surcharge (PCS)

The Port Congestion Surcharge (PCS) covers additional costs arising from extended waiting times or operational delays caused by crowded or particularly busy ports.

08. Temporary Additional Risks (TAR)

Temporary Additional Risks (TAR) is akin to a war surcharge, imposed in regions facing heightened risks due to political instability or other hazards.

09. Terminal Handling Charge (THC)

The Terminal Handling Charge (THC) includes costs associated with cargo handling at the port, encompassing Origin Terminal Handling Charge (OTHC) and Destination Terminal Handling Charge (DTHC).

10. Original Receiving Charge (ORC)

Specific to ports in southern China, the Original Receiving Charge (ORC) covers origin handling costs. It is charged exclusively for long-distance routes to regions like North America and Europe and is not applicable alongside THC.

11. Long Length Additional (LLA)

Long Length Additional (LLA) applies to cargo exceeding specific length limits, requiring special handling or equipment. The surcharge increases incrementally based on the cargo's length.

12. Heavy-Lift Additional (HLA)

Heavy-Lift Additional (HLA) is charged for individual cargo pieces exceeding a specified weight threshold. The fee compensates for the use of specialized equipment or additional labor during loading and unloading.

13. General Rate Increase (GRI)

GRI (General Rate Increase) refers to a surcharge applied primarily on South America and U.S. routes. It is challenging to determine the specific conditions under which this surcharge is applied, as it depends on various factors like ports, vessels, fuel, cargo, and other operational costs.

The GRI compensates for the increased expenses incurred by shipping companies due to rising transportation costs. However, the exact calculation and triggering conditions are often unclear.

14. Fuel Surcharges (FAF, IFA, EBS, EBA)

Fuel surcharges reflect fluctuations in international fuel prices. When prices rise significantly or fluctuate frequently, shipping companies impose these charges to offset additional operating costs. The surcharge varies based on routes or carriers and may be charged as a percentage of the base rate or per freight ton.

Types of Fuel Surcharges:

• FAF (Fuel Adjustment Factor): Commonly used on Japan routes.
• IFA (Interim Fuel Additional): Sometimes perceived as a "long-term" fee despite being labeled as "temporary."
• EBS (Emergency Bunker Surcharge): Applied on Australia/New Zealand routes to cover unexpected fuel price hikes.
• EBA (Emergency Bunker Additional): Similar to EBS but used on Africa and South America routes.

15. Direct Additional (D/A)

D/A (Direct Additional) is charged when shippers request direct transportation from the origin port to a specific destination port without transshipment. This fee typically applies to small or less commonly used ports and requires a minimum cargo volume, often 1,000 tons.

16. Deviation Surcharge (D/S)

D/S (Deviation Surcharge) is a temporary fee imposed when vessels must deviate from their planned route due to unforeseen circumstances, such as political unrest, war, canal closures, or navigational blockages. The surcharge compensates for increased expenses caused by the deviation and is usually calculated as a percentage of the base freight.

17. Destination Delivery Charge (DDC)

DDC (Destination Delivery Charge) is commonly applied in LCL (Less than Container Load) shipping, especially for door-to-door services. This fee is paid by the consignee unless specific terms like DDU or DDP dictate otherwise.

18. Container Service Charge (CSC)

CSC (Container Service Charge) covers various container-related services, such as storage, handling, leasing, inspection, and repair. These activities are essential for reducing overall container costs and improving efficiency.

19. Equipment Positioning Surcharge (EPS)

EPS (Equipment Positioning Surcharge) is a fee related to container placement to accommodate export cargo locations. It may also involve expenses for equipment transportation, installation, and adjustment.

20. Currency Adjustment Surcharge (CAS, CAF)

CAS (Currency Adjustment Surcharge) and CAF (Currency Adjustment Factor) are applied when the freight currency experiences significant devaluation. These surcharges help shipping companies offset losses caused by currency fluctuations.

21. Automatic Manifest System (AMS/ACI)

AMS (Automatic Manifest System) is specific to U.S. routes and requires cargo bound for or transiting through the U.S. to be declared 24 hours before loading. Similarly, Canada has the ACI (Advance Commercial Information) system, which follows the same principle.

22. Entry Summary Declaration (ENS)

ENS (Entry Summary Declaration) is an EU-specific rule requiring cargo destined for or transiting through EU ports to be declared in advance. This regulation applies to all EU member states, as well as Norway, Switzerland, and Turkey.

23. Optional Fee

The Optional Fee is charged when shippers request the flexibility to choose a discharge port from two or more pre-determined options.

24. Alternative of Destination Surcharge (ADS)

ADS (Alternative of Destination Surcharge) applies when shippers request a change in the originally designated discharge port, subject to approval by customs and the shipping company.

25. Ice Surcharge

The Ice Surcharge is imposed during severe winter conditions, such as port delays, waiting times, or icebreaking operations, to compensate for additional costs incurred by the shipping company.

26. Cleaning Charge

The Cleaning Charge, also known as Cleaning Labor Fee or Sweeping and Cleaning Charge, is commonly encountered in bulk cargo transportation. Sweeping refers to the cleaning process carried out by the crew or third-party labor companies after cargo unloading and before loading the next voyage. This ensures the cargo hold is suitable for the next shipment.

Cleaning, on the other hand, involves washing the cargo hold using seawater, freshwater, or cleaning agents to achieve a clean state.

27. China Import Service Fee (CISF)

CISF, or China Import Service Fee, is a surcharge specifically applied to goods imported from China to Europe. This fee is typically charged by the destination port agent to the consignee. Usually, the buyer pays this fee, but it can also be borne by the seller depending on contractual agreements. It is best to negotiate and clarify this in the contract.

The CISF may vary depending on the destination country's policies. Regardless of whether it involves Full Container Load (FCL) or Less than Container Load (LCL), the rates are generally fixed. However, LCL shipments are more prone to higher charges, especially when the origin port's fees are particularly low. This is because the CISF is closely related to domestic consolidation costs—lower origin fees often result in higher CISF and other overseas charges.