Freight. Simply, this means the price payable to the carrier for carrying cargo in a good condition and delivery to the owner of an interest in the cargo.
The word refers to many other issues related to chartering, such as “freight taxes”, “freight prepaid”, etc. The payment for the service of carrying goods under voyage charters, charters for consecutive voyages or contracts of affreightment. Even in the liner trades the price is called “freight” although here the list of freight rates is termed a “tariff”. For a ship chartered for a period (time charter) the payment is called “hire”. A typical clause dealing with the payment of freight can be found in the MULTIFORM charterparty:
“The freight is to be at the rate of . . . per ton of 1000 kilos on gross bill of lading weight and is to be paid in the following manner:
The freight shall be deemed earned as cargo is loaded on board and shall be discount less and nonreturnable, vessel and/or cargo lost or not lost.”
The charterparty usually clearly states the basis .of the payment of freight. Therefore, freight can be payable as $(x) per metric or long or short ton of cargo. In the liner trades it can be based on the weight’ or volume. The freight can also be “lumpsum”, that is, a fixed amount irrespective of the quantity of cargo loaded. On bulk cargoes it can be based on “outturn” which is the measured and weighed quantity discharged. It can also be based on the bill of lading weight when the cargo is shipped.
The time when freight becomes payable is when the cargo is delivered at the agreed destination unless the contract states otherwise. Freight can also be paid in advance. The owner can insist that the freight is payable before releasing bills of lading or, on delivery, “before breaking bulk” or commencing discharge.