A non-vessel-operating common carrier is a freight forwarder that organizes the transportation of goods without owning the means of transportation. They make contracts with both the shipper and the carrier for transporting the goods. A carrier is an entity that transports passengers or goods for payment. A common carrier is a business that offers to transport freight or passengers for a fee and is legally obligated to transport them if the approved fare is paid. A private carrier is any carrier that is not legally obligated to accept business from the general public.
A non-vessel-operating common carrier (NVOCC) is a type of freight forwarder that does not own transportation means. Instead, it contracts with a shipper to transport freight and with a carrier to perform the transportation. In this arrangement, the NVOCC becomes the carrier in the contract with the shipper and the shipper in the contract with the eventual carrier. For instance, if a company wants to ship goods from China to the United States, they may engage an NVOCC who will then contract with a carrier to transport the goods. The NVOCC takes responsibility for the contract with the shipper, while the carrier handles the actual transportation. Another type of carrier is a common carrier, which is a commercial enterprise that publicly offers to transport freight or passengers for a fee. Common carriers are legally obligated to transport freight or passengers upon payment of the approved fare or charge. On the other hand, private carriers, also known as contract carriers, are not bound by law to accept business from the general public. They are carriers that do not fall under the category of common carriers.
A Non-Vessel-Operating Common Carrier (NVOCC) is a type of freight forwarder that does not own or operate vessels, but instead arranges for the transportation of goods on behalf of shippers.
An NVOCC provides a range of services including booking cargo, arranging for transportation, preparing and processing documentation, and providing cargo insurance.
While both NVOCCs and freight forwarders arrange for the transportation of goods, NVOCCs specifically do not own or operate vessels, whereas freight forwarders may offer a wider range of logistics services.
NVOCCs are required to be licensed by the Federal Maritime Commission (FMC) in the United States and comply with various regulations related to tariffs, bonding, and insurance.
Yes, NVOCCs can issue their own bills of lading, which serve as a contract of carriage and a receipt for the goods being transported.
NVOCCs are generally liable for the loss or damage of cargo under the terms of their bills of lading and are required to have cargo insurance to cover such liabilities.
Yes, NVOCCs often subcontract the transportation of goods to VOCCs, who are the actual owners or operators of vessels.
The risks of using an NVOCC include potential liability issues, delays in transportation, and the possibility of dealing with unscrupulous or unlicensed operators.
You can verify the legitimacy of an NVOCC by checking their licensing status with the Federal Maritime Commission and by reviewing their track record and reputation in the industry.
When choosing an NVOCC, consider their experience, track record, network of carriers, and their ability to provide competitive rates and reliable service. It’s also important to review their contracts and terms of service carefully.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 17th April 2024.
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