Responsibility of the Buyer and Seller in the Case of Cargo Damage

Cargo costs calculation

When an individual buys a product online, the company that they buy it from is generally responsible for any damages that it incurs along the way. If the package was damaged in transit, the shipper might be responsible. The seller may request that the shipper reimburse them for the cost of the replaced product and refund the money for shipping.

Things are a bit more complicated when it comes to companies that import and export products. Much of the responsibility for a damaged product will have to do with contracts and documenting records properly.

The Importance of the Incoterm

When you hear the word “incoterm,” you can’t help but think of a device used to make announcements in a building. No, that’s an intercom. An incoterm is a set of 11 rules followed by importers and exporters. Each incoterm will contain detailed information about the responsibilities of each company and the cargo being shipped.

This contract will specify where shipments originate, how they will be shipped, and the exact location to which they will be shipped. It will specify which ports will be used, and every mode of ground transportation. The agreements also specify at what point each party is responsible for damages.

When an importer and exporter do business with one another, one of the parties will be responsible for hiring an Ocean Freight Forwarder. The forwarder’s job is to arrange for transportation of products from one place to another. They will have contracts with various transportation companies that travel by land, air, and sea. The freight forwarder’s contract will state who is responsible for damages under different circumstances.

If the exporter was saddled with the task of hiring a freight forwarder and a product is damaged on the way, the exporter may be responsible for seeing that the damages are paid for. They will be the ones to make an insurance claim with the transportation company that caused the damage.

Bill of Lading

Whenever companies send big shipments overseas, they will use a document called a bill of lading, which lists the goods being delivered in great detail. There should be a bill of lading every step of the way. The truck driver who picks up the product from the exporting company should sign one. An Employee of the cargo ship on which the product will travel to its destination should sign one, and so should the truck drivers and train conductors.

When you sign a bill of lading, you generally are agreeing that you have received the product in one piece. Hence, if the recipient signs for a shipment and then find out it’s damaged, they may be held responsible.

If you are an importer-exporter, remember to read everything very carefully before you sign it, and hire a freight forwarder who has your best interest at heart. Remember to take your time in preparing everything for shipment and unpack everything with care.

People love to try products from other countries. If you have something useful to offer the public and you handle your shipping correctly, your customers will be very satisfied, and you will make a profit.

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