THE DEVELOPMENT TEAM. Vice Chancellor, Indira Gandhi University, Rewari. Director, UIHTM, Panjab University, Chandigarh

Transcription

1 Paper 8: Cargo Operations and Management Module 09: Airway Billing THE DEVELOPMENT TEAM Principal Investigator Co-Principal Investigator Paper Coordinator Paper Co-Coordinator Content Writer Content Reviewer Prof. S. P. Bansal Vice Chancellor, Indira Gandhi University, Rewari Dr. Prashant K. Gautam Director, UIHTM, Panjab University, Chandigarh Prof. S. P. Bansal Vice Chancellor, Indira Gandhi University, Rewari Dr. Amit Katoch Assistant Professor, UIHTM, Panjab University, Chandigarh Dr. Amit Katoch Assistant Professor, UIHTM, Panjab University, Chandigarh Prof. S. Kabia Chairman, Institute of Tourism and Hotel Management, Bundelkhand University, Jhansi

2 TERMS Subject Name Paper Name DESCRIPTION OF MODULE Tourism & Hospitality Cargo Operations and Management Module No. 9 Module Title Objectives Keywords Airway Billing To become familiar with the airway bill. Airway bill, types of airway billing, functions of Airway Billing TABLE OF CONTENTS 1. Learning Outcome of module 2. Introduction 3. Description about Airway billing 4. Types of Airway billing 5. Functions of Airway Bill 6. Validity of Airway Bill 7. Responsibility of Airway Bill 8. Why airway bills are non-negotiable 9. Number of Airway Bill 10. Summary

3 QUADRANT I AIRWAY BILL 1. Learning outcome of module After completing this module, students will be able to learn about airway bill & its types: Airway billing Types of Airway billing Functions of Airway bill Validity of Airway bills Responsibility of airway bill Number of airway bill SOURCE:

4 2. Introduction An airway billing is basically a receipt provided for products and parcel by an international airline and it is a proof of the commitment of coach. This bill is not negotiable. This airway bill includes the shipper s address, details and name followed by consignee s address, details and name, letter of code of airport which is the origin, code of destination s airport, proclaim shipment worth for customs, total number of equipment parts, total weight of the consignment, details of the material and important instructions of handling it. This airway bill also mentions the terms and condition of the company who is shipping the parcel from one place to another for example liabilities limit and the process of claiming. SOURCE:

5 3. Description about Airway billing Airway bills are a type of bill of lading which is utilized for international as well as domestic flights. Airway billing process is completed by the airline company or the exporter. This is used as: Receipt of shipment of material Proof of commitment of shipment Insurance document/ proof Important instructions of handling Needful for clearance of customs Freight weight and details of shipper address and name Mostly airway bills are composed of three original copies and nine Xerox copies and are in different colours. Out of three original copy first one is green in colour and is made for the company or the airline and it is signed by the agent who is exporting it, then comes the second original copy which is pink in the colour; the copy for the consignee and this is also signed by the agent itself, then comes the third original copy which is blue in colour; signed by the airline and it is handed over to agent or the exporter as a proof of the consignment just after the airline have allowed the parcel for shipment. Then the forth copy is brown in colour and is the receipt of delivery. The other copes are white in colour. The major requirement is that airway billing must be attached with the commercial invoice, list of packing material, and many other important certifications which may be required for the clearance through customs and certification of origin. Sometimes the goods are transferred after 48 hours to the destination location for the safety reasons of the aircrafts. There is a tracking number on the airway bill which helps in checking the delivery status along with this it also helps in locating the current present location of the parcel which has been transferred. Every company has its own airway billing charges as per their terms and conditions.

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7 4. Types of Airway billing Basically there are two types of airway billing which is utilized for the international transfer of goods: Airline air waybill, which has preprinted issuing carrier details Neutral air waybill which does not have preprinted details of the carrier who is issuing so it is utilized by different bodies different from air carriers Then there three different types of airway bills: Direct airway bill This bill is issued by the carrier or the airline straight to the agent or the exporter. House airway bill When consolidators issues this bill. Master airway bill When consolidator issued this bill on the behalf of airline, there might be one or more house airway bills in master airway bill. Difference between bill of lading and airway billing Bill of lading is different from airway billing as lading billing is a document of title and airway billing is not. But airway bill can be constructed in a way that it can be utilized as a document of title along with it as document which is negotiable. In another way airway bill is a receipt which is prepared by airline for the parcel to the person or company who is sending it; but bill of lading is a receipt provided by sea carriers for the parcel to the person or company who is sending it. Illustration The airway bill is document prepared by the airline or the carrier either via recognized agents or directly and this document is very important. Airport to airport transportation of goods is included in the airway bill. By receiving a parcel an agent of IATA cargo acts in the interest of the transporter or the conveyor whose air waybill is provided. To make bookings or check the delivery status and latest location of the parcel there is an eleven digit number which can be utilized in airway bills. The person or company that transfers the parcel always gets airway bill just after handing it over to them. As the parcel is transferred through air it is obvious that the transit duration is very less as

8 compares to the shipment through sea so that set of all the airway bills are dispatched with the goods itself just for urgent reference and for the clearance through the customs by the importer at the final destination port. Just after the completion of customs procedure and formalities at the origin port customs point, IATA agent s issues the cargo transfer manifest beside with airway bill and many different certificates which are required by air carriers for the transfers. The airway bills original copy is mandatory for importers, shipper, carrier along with extra copies. Once after arrival of cargo at destination, the importer or his cargo agent approaches the destination office of air carrier and collect airway bill and other required documents sent by shipper along with cargo for necessary documentation for import customs clearance procedures and other references. Importer may also collect copies of documents by courier or mail from shipper before arrival of goods. SOURCE:

9 5. Functions of Airway Bill A) Carriage contract On the back side of airway bill there are the terms and conditions of the commitment B) Proof of receipt As soon as the transporter supplies the carrier to forward agency, they will be getting a receipt of proof. It is a proof that the parcel condition was good at the time of handing over along with that they will be mentioning the important instructions, as per the Shipper's applications of order which are adequate. Following the accomplishment, an airway bill s original copy is provided to the shipper as a proof of the obtaining of cargo and as carriage contract evidence. C) Bill of shipment The airway bill might be utilized as a an invoice along with other important documents as it may let to know about the price which need to be paid by the receiver, charges due to the agent or the carrier. Airway bill s original is utilized for the accounting of the conveyor. D) Insurance document This bill can also be represented as a proof only if conveyor is in a situation to insure the cargo; mostly they are instructed to do so by the airlines and the shipping company. E) Customs declaration Although customs command needs many different types of documents such as commercial statement, list of packing materials and so on; this is fulfilled by airway bill itself. The air waybill is an evidence of the cargo calculated for the material transferred simultaneously might be required so as to present it for clearance of customs. Airway bill has a great design which has been outlined by IATA and these can be utilized for international transportation and domestic transportation both. There are two types of custom declaration which are: The airline logo equipped air waybill

10 The neutral air waybill Mostly, airline air waybills are spread by IATA airlines to cargo agents of IATA. The airway bills show: The carrier's name Its head office address Its logo The preprinted eleven digit airway bill number This is as well feasible to conclude an airway bill via computerized system. In today s time all the agents of this line are utilizing their personal in-house computer systems worldwide for providing freight forwarders and airlines along with airway bills. Mostly airway invoices of many different conveyors are fascinated by IATA cargo agents only. But in the computer system, this slowly gets tough in indulging these airway bills which are pre-numbered to accompany them with the printed identification; this lead to establishment of the neutral airway bill. The style and layout of airway bill s both types are same. But, the neutral airway bill does not carry any pre-printed name of the individual; address of head office, serial number and logo. 6. Validity of the airway bill The airway bill is an agreement that is a contract compulsion through law. Shipper or his agent sign are very important to be done so as to become a genuine agreement as well as by the conveyors its agents which are authorized. While the similar single person or corporation may work in the interest of the conveyor and the shipper who is sending the cargo from one destination to another, the airway bill should be signed two times in the specific carrier with everyone and shipper boxes. Both the signs may be of the same man. These too states that the airway bill should be provided urgently on the receipt of the material and the important directions for the handling through application from the person or company who is sending the cargo. Since, if the airway bill is not signed two times and not dated that means the cargo will not be accepting the terms and condition of the agreement or the contract and this will result in that the conveyor or the transporter will not take any authority/capability for the cargo. Thus the

11 authenticity of the airway bill and the agreement of coach become invalid just after the delivery of the goods to the consignee or the agent. 7. Responsibility of the airway bill In simple terms the airway bill is an agreement between the conveyor and the person or the company who is sending the cargo from one place to another. The consignee mostly works as a mediator between the person or the company who is sending the cargo from one place to another and conveyor or transporter. In another way it can be said that the airway bill is an agreement of better trust. This means that the shipper will be responsible for the haul also be liable for all the damage suffered by the airline or any person due to irregularity, incorrectness or incompleteness of insertions on the air waybill, even if the air waybill has been completed by an agent or the carrier on his behalf. Just after the person or the company who is sending the cargo from one place to another authorizes the airway bill either application of important instructions are given then it means that the consignee have agreed to the terms and condition of the agreement. 8. Why airway bills are non-negotiable: Airway bills are the documents which are non-negotiable and are different from bills of lading as they are negotiable documents. On the top of the airway bill it is very clearly mentioned that this is non-negotiable which directly means that the airway bill is an agreement of conveying the cargo only as it does not constitute the stock value declared on the packing nature and the quantity of the cargo. But on the other hand if we talk about the bill of lading via ocean which is negotiable it may constitute the value of the cargo and must be countersigned by the person who finally accepts the parcel. While the airway bills are not the transferrable documents so it can be utilized as a mode of payments also. Such thing can be processed only via the mediator of a bank as well as only that period of time when the coach is subjected to an application of solvency. The invoice value of the conveyed cargo can be collected from the bank only after the airway bill mentions the term of credit through application which permits the airline or the shipper to show the original copy of the airway bill in bank and collect from them only. The worth to the shipper is

12 handed over via bank which gets deducted to the agent the one who requested the cargo. At the final station the conveyor or the transporter will only deliver the cargo to the agent or the consignee after getting the receipt of bank release orders via agent s bank only. The cargo sent via air shipment is directly assigned to the person or the agent name mentioned in the letter of credit. Till the time the cargo is delivered to an issuing bank which can be a third party, the importer can get the parcel from the conveyor or the transporter at final location without paying money to the bank whose will issue or the agent. Thus, until a payment of cash has been recovered by the exporter or the buyer's honesty is not questionable, thus it is risky to directly consign the cargo to the importer. Cash on delivery basis is also possible at some final locations or the destinations for air shipment and cargo is directly delivered to the importer or the shipper whose gone a receive the goods. The parcel is given to the importer only if he or she pays full payment as well as attach with the terms in the airway bill. While in air shipment, the consignor or the importer most of the time employ an organization which collect and transport the cargo on demand of other company or consolidator for handling the transportation of material. The agent or the consignor gives a Shipper's application of orders which permits the transporter agent for countersigning some documents like the airway bill for the person who sends the shipment. The airway bill should mention that the material has been received for shipment, and it should be authorized or countersigned by the conveyor or the transporter either the agent s name or on the charge of the conveyor. The authorization or countersign of the transporter should be mention as conveyor, and when we talk about the case of consignee authorization or countersign, the total capacity and the name of the conveyor should importantly be mention in that; on whose charge the consignee authorize or countersign the airway bill. Master airway bills - International airway bills that have stabilized goods are known as master airway bill. Master airways bills have extra documents known as house air waybills. Every house airway bills consist of details of every single shipment like consignee, contents, details etc. inside the combination. International airway bills which are not combined are known as simple airways bills. A house airway bill can additionally be generated by an organization which collect and transport the cargo on demand of other company. Just after the booking shipment is done, the Master airway

13 bills will be generated and given to the conveyor, in turn they provide their own house airway bill to their client. Procedure of disbursement of payment First of all submit the request for the disbursement of payment Attach the entire important supporting document with it like non-negotiable airway bills, commercial bills, and Importers background and business activity information. 9. Number of Airway bill The airway bill number is an 11 digit number and distributed in 3 parts: Airline prefix are the first three numbers out of 11 digits Then comes the serial number of airways bill which cover next 7 numbers The last number left is the check digit; it is basically when a 7 digit number is divided by 7 every time the remainder left behind is the check digit for example divided by 7 gives with remainder 7 so 7 will be the last digit of 11 digit airway bill. The Air Waybill (AWB) is a critical air cargo document that constitutes the contract of carriage between the shipper and the carrier (airline). Electronic Air Waybill Resolution 672 (MeA) removes the requirement for a paper AWB. There is therefore no longer a need to print, handle or archive the paper, largely simplifying the air cargo process. The e-awb project is part of the e-freight initiative and aims at encouraging air cargo players to use the electronic AWB (e-awb), instead of its paper version. Moving to e-awb is a key enabler to achieve the 100% e-freight vision. E-AWBLink is a basic industry tool designed for small and medium-sized freight forwarders to become e-awb capable. In May 2017, the Air Cargo industry processed more than 2.4 million Air Waybills (AWBs). The industry is driven by three main regions representing 75% of the AWBs: Europe, Asia Pacific and North Asia. The global e-awb penetration reached 50.6% on the legally feasible trade lanes (nearly 60% of the AWBs). In December 2016, the global e-awb penetration reached 48.9% on the feasible trade lanes, a shortfall of 7.1 percentage points against the industry target of 56%.

14 10. Summary The airway bill is an important document that accompanies goods shipped by an international courier to provide detailed information about the shipment and allow it to be tracked. Also, it has multiple copies so that each party involved in the shipment can document it. The bill contains the shipper's name and address, consignee's name and address, three letter origin airport code, three letter destination airport code, declared shipment value for customs, number of pieces, gross weight, a description of the goods and any special instructions (e.g.,. "Perishable"). It also contains the conditions of contract that describe the carrier's terms and conditions, such as its liability limits and claims procedures. It is a non-negotiable transport document. It covers transport of cargo from airport to airport. By accepting a shipment an IATA cargo agent is acting on behalf of the carrier whose air waybill is issued. The airway bill is an important document and serves as a Contract of Carriage, Evidence of Receipt of Goods, Freight Bill, Certificate of Insurance and customs declaration. The need of the hour of AWB is to go paperless. The challenges in implementing eawb are that regulatory limitations occur at the airports, its procedures not harmonized between freight forwarders, airlines & ground handling agents, majority of SME forwarders are not having technical ability, Perceived complexity to do e-awb for forwarders dealing with multiple airlines etc.