Maritime surcharges (BAF, THC, CIF)

Maritime surcharges (BAF, THC, CIF, etc.)

Shipping surcharges are additional fees charged by shipping companies in addition to the base freight rate. They can represent a significant part of the total transport cost.

Main overloads

• BAF (Bunker Adjustment Factor): adjustment linked to the price of fuel. Also called EBS (Emergency Bunker Surcharge) or LSS (Low Sulfur Surcharge) since the IMO 2020 standards
• THC (Terminal Handling Charges): handling charges at the port terminal (loading/unloading of the container)
• CAF (Currency Adjustment Factor): adjustment linked to exchange rate fluctuations
• ISPS (International Ship and Port Facility Security): security overload since September 11, 2001
• GRI (General Rate Increase): general increase in rates
• PSS (Peak Season Surcharge): high season surcharge
• ECA (Emission Control Area): surcharge for low emission zones

Impact on Incoterms

The distribution of surcharges depends on Incoterm. In FOB, surcharges at the port of departure (THC origin) are generally the responsibility of the seller, while surcharges at sea and at destination are the responsibility of the buyer.

Negotiation

Surcharges are negotiable, especially in the context of volume contracts. It is essential to request an “all-in” quote detailing all surcharges to avoid unpleasant surprises.