Back Freight

Payment due to the shipowner for the carriage of goods beyond the contract port owing to circumstances beyond the control of the shipowner.

Back Order

That portion of an order that the vendor cannot deliver on schedule and which has been re-entered for shipment when available.

Balance of Trade

The difference between a country's total imports and exports. If exports exceed imports, a favorable balance of trade exists; if not, a trade deficit is said to exist.

Banker's Acceptance

Importer's bank accepts responsibility to pay against a draft (substituting for the importer's responsibility).

Banker's Bank

A bank that is established by mutual consent by independent and unaffiliated banks to provide a clearinghouse for financial transactions.

Banker's Draft

Draft payable on demand and drawn by or on behalf of the bank itself; it is regarded as cash and cannot be returned unpaid.

Bank Affiliate Export Trading Company

An Export Trading Company partially or wholly owned by a banking institution as provided under the U.S. Export Trading Company Act.

Bank for International Settlements (BIS)

BIS, established in 1930, promotes cooperation among central banks in international financial settlements. Members include: Australia, Austria, Belgium, Bulgaria, Canada, Czechoslovakia, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Netherlands, Norway, Poland, Portugal, Romania, South Africa, Spain, Sweden, Switzerland, Turkey, the United Kingdom, the United States, and Yugoslavia. Bank headquarters are in Basle, Switzerland.

Bank Guarantee

An assurance, obtained from a bank by a foreign purchaser; that the bank will pay an exporter up to a given amount for goods shipped if the foreign purchaser defaults. See Letter of Credit.

Bank Holding Company

Any company which directly or indirectly owns or controls, with power to vote, more than five percent of voting shares of each of one or more other banks.

Bank Release

Negotiable time draft drawn on and accepted by a bank that adds its credit to that of an importer of merchandise.

Bare Boat Charter

Charterer hires a vessel for a long period, appoints the master and crew, and pays all running expenses.

Bargaining Power

Each party negotiating to participate in an international business strategic alliance that can bring complementary skills and assets to the alliance that urgently needs them has real bargaining power. The goal in negotiations is to find ways for each partner to win short, medium and long term potential benefits thereby bringing forth its best creative powers, unique talent and significant advantages.

Barratry

An illegal or fraudulent act committed by the master or crew to the prejudice of the owner or charterer.

Barter

Trade in which merchandise is exchanged directly for other merchandise without use of money. Barter is an important means of trade with countries using currency that is not readily convertible.

Basel Convention

The Basel Convention restricts trade in hazardous waste, some non-hazardous wastes, solid wastes, and incinerator ash. It was adopted in 1989 by a United Nations-sponsored conference of 116 nations in Basel, Switzerland. Twenty nations must ratify the treaty before it goes into effect.

Beaufort Scale

A windscale and sea disturbance table by which mariners grade the force of wind and height of waves, thus communicating the general condition of the sea to others by the use of a wind force number.

Beneficiary

The person in whose favor a letter of credit is issued or a draft is drawn.

Best Information Available

Under GATT rules, when a respondent in an antidumping or countervailing duty case either declines to provide information, or provides inadequate information, the investigating authority has the right to resort to other information, a practice known as best information available. Determinations of BIA may be made on a case-by-case basis; in some cases, it may be information submitted be petitioners.

Bid Bond

When an exporter is bidding on a foreign contract, a bid bond guarantees that the exporter will take the contract if it is awarded. If the exporter fails to take the contract, it will have to pay a penalty in the amount of the bond. A bid bond is usually requested by a foreign organization to screen out weak contenders. Your financial institution or the Export Development Corporation can assist in financing and issuing these bonds.

Bidder List

A list maintained by an organization giving names and addresses of suppliers of various goods and services from who bids and proposals can be solicited.

Bilateral Clearing Agreement

Government-to-government reciprocal trade arrangement whereby two nations agree to a trade turnover of specified value over one or more years. The value of the products traded under the agreement is denominated in accounting units expressed in major currencies--such as clearing U.S. dollars, clearing Swiss francs, etc. Exporters in each country are paid by designated local banks in domestic currencies.

Bill of Exchange

An order in writing from one person or firm to another requiring them to pay a certain sum to a person named.

Bill of Lading

A document that is a receipt for cargo received on board and is evidence of the contract between shipper and shipowner. It is also evidence of title to the goods described on it. Establishes the terms of a contract between a shipper and a transportation company under which freight is to be moved between specified points for a specified charge. Usually prepared by the shipper on forms issued by the carrier, it serves as a document of title, a contract of carriage, and a receipt for goods. Also see Air Waybill, Inland Bill of Lading, Ocean Bill of Lading, and Through Bill of Lading.

Biological Agents

Several classes of biological agents have been identified according to their degree of pathogenic hazard, and are controlled by the United States in accord with provisions of the Australia Group. Applications submitted to the Department of Commerce for the export of certain biological agents are generally referred to the Department of State and the intelligence community on a case-by-case basis.

Blanket Order

See open-end contract.

Blocked Currency

Currency that cannot be freely transferred into convertible currencies and expatriated. Usually synonymous with foreign-owned funds or earnings in countries where government exchange regulations prohibit their expatriation.

Bond

A debt instrument that pays a set amount of interest on a regular basis. The issuer promises to repay the debt on time and in full. Bonds are bought and sold on the market.

Bond (performance)

A bond executed in connection with a contract that secures the performance and fulfillment of all conditions and terms written into the purchase order.

Bond System

The Bond System, a part of Customs' Automated Commercial System, provides information on bond coverage. A Customs bond is a contract between a principal, usually on importers, and a surety which is obtained to insure performance of an obligation imposed by law or regulation. The bond covers potential loss of duties, taxes, and penalties for specific types of transactions. Customs is the contract beneficiary.

Bonded Exchange

Exchange that cannot be freely converted into other currencies.

Bonded Goods

Imported goods deposited in a Government warehouse until duty is paid.

Bonded Warehouse

A warehouse authorized by customs authorities for storage of goods on which payment of duties is deferred until the goods are removed.

Bonding Company

An organization that is prepared to undertake an agreement to make good a financial guarantee on behalf of another responsible for such guarantee. Owners of "arrested" vessels may obtain such a bond to satisfy a court and to obtain release of the vessel.

Book-to-bill Ratio

A measure of sales trends of a company or industry. A number above 1 indicates an expanding market, and a number below 1 is a contracting market. For example, a book-to-bill ratio of 1.03 means that for every $100 of products shipped, $103 in new orders was received.

Book Value

The difference between a company's assets and its liabilities, usually expressed in per-share terms. It takes into account all money invested in the company since its founding, as well as retained earnings. It is calculated by subtracting liabilities from assets and dividing the result by the number of shares outstanding. Comparing book value to share price is one way to gauge if a company's stock is undervalued or overvalued.

Booking

An arrangement with a steamship company for the acceptance and carriage of freight.

Border Cargo Selectivity (BCS)

BCS is an automated cargo selectivity system based on historical and other information. The system is designed to facilitate cargo processing and to improve Customs enforcement capabilities by providing targeting information to border locations. The system is used for the land-border environment.

Bottom Line

Accounting term for the net profit or loss.

Bottomry Bill or Bond

The pledge of a ship, or of her cargo, as security for repayment of money advanced to the master in an emergency, and of no avail if the ship be lost.

Bow Thruster

A propeller used to provide a transverse thrust to the bow of a ship and to assist movement in confined spaces.

Brand Name Specification

A specification that cites a brand name, model name, model number or some other designation that identifies a specific product as an example of the desired quality of merchandise.

Break Bulk

Loose cargo, such as cartons, stowed directly in the ship's hold as opposed to containerized or bulk cargo. See "Containerization."

Break Bulk Cargo

An assembled variety of shipments in a vessel, or one hold of a vessel, to be sorted (disseminated) after discharge. The opposite to bulk cargo where one shipment occupies the hold, or the ship alone.

Breaking Bulk

The initial opening of hatches on entering port and the commencement of discharge of cargo.

Broker

An agent employed (at a customary or an agreed rate of commission or remuneration) to buy or sell goods, merchandise or marketable securities, or to negotiate insurances, freight rates or other matters, for a principal the sales of transactions being negotiated not in his own name but in that of the principal.

BSC (Bunker Surcharge)

An extra charge by the carrier to adjust for temporarily higher fuel costs. Also called fuel surcharge.

Build-Operate-Transfer (BOT)

Debt and equity financing of a major turnkey project, such as a nuclear power plant.  The foreign supplier constructs and then operates the completed plant for profit over a contracted number of years. Until the plant is transferred to local ownership, the revenues derived from its operations serve to service debt and generate returns for the supplier.

Bulk Cargo

Bulk cargo is unbound as loaded and carried aboard ship; it is without mark or count, in a loose unpackaged form, and has homogeneous characteristics.

Bulk Shipments

Shipments that are not packaged, but are loaded directly into the vessel's holds. Examples of commodities that can be shipped in bulk are ores, coal, scrap, iron, grain, rice, vegetable oil, tallow, fuel oil, fertilizers, and similar commodities.

Bulkhead

Front wall of container. Vertical separation between the holds of a ship (now extended to cover all vertical panels).

Bundesbank

The Bundesbank is the German central bank. The main functions of the Bundesbank are to regulate the money supply, support the general economic policy of the federal government, and issue banknotes. It sets the key discount rate, the Lombard rate, and minimum reserve requirements. Bank headquarters are in Frankfurt, Germany.

Bunker Surcharge

A charge levied by the 'Ocean Carrier' over and above the ocean freight rate to offset adjustments of oil bunkering costs.

Business Facilitation Office (BFO)

This is usually a booth with a reference desk with product catalogs manned by the Commercial Section or a qualified contractor to assist fair visitors or buyers searching for U.S. products or services at an international trade fair.

Buyback (or Compensation)

Buyback is an agreement whereby the primary supplier accepts as full or partial repayment products derived from the original exported product. Buyback arrangements support the financing of production facilities - e.g., the export of machinery and capital equipment, manufacturing processes, and technology.

Buyer Credit

Some export sales, especially sales of capital equipment, may sometimes require financing terms tailored to the buyer's cash flow and may involve payments over several years. Often the buyer obtains a loan from its own bank or arranges for other financing to enable it to pay cash to the exporter. U.S. exporters frequently benefit from such buyer credits when federal agencies such as the U.S. Export-Import Bank and Overseas Investment Corporation participate.

Buying Agent

See Purchasing Agent.