Global Ship Lease - Glossary
Glossary

B

Ballast
A voyage during which the ship is not laden with cargo.
Bareboat Charter
A charter of a ship under which the shipowner is usually paid a fixed amount of charterhire for a certain period of time during which the charterer is responsible for all of the ship operating expenses and voyage expenses and for the management of the ship, including crewing. A bareboat charter is also known as a "demise charter" or a "time charter by demise."
Bunkers
Heavy fuel and diesel oil used to power a ship's engines.

C

Capacity
The nominal capacity of a vessel, measured in TEU (twenty foot equivalent unit) for a containership.
Charter
The hire of a ship for a specified period of time or a particular voyage to carry a cargo from a loading port to a discharging port. The contract for a charter is commonly called a charterparty.
Charter hire
A sum of money paid to the shipowner by a charterer for the use of a ship. Charterhire paid under a voyage charter is also known as "freight".
Charter owners
A company that owns container vessels and charters out its vessels to container shipping companies rather than operating the vessels for liner services; also known as shipowner.
Charter rate
The rate charged by charter owners normally as a daily rate for the use of their container vessels by container shipping companies. Charter rates can be on a time charter, voyage charter or bareboat charter basis.
Charterer
The party that hires a ship for a period of time or for a voyage.
Classification society
An independent organization that certifies that a ship has been built and maintained according to the organization's rules for that type of ship and complies with the applicable rules and regulations of the country of the ship's registry and the international conventions of which that country is a member. A ship that receives its certification is referred to as being "in-class".
Container shipping company
A company that operates frequent scheduled or "liner" services, with predetermined port calls, using a number of owned or chartered vessels to transport cargoes by containers; also known as a liner company or a container operator.

D

Dry docking
The removal of a ship from the water for inspection and repair of those parts of a ship that are below the water line. During drydockings, which are required to be carried out periodically, certain mandatory classification society inspections are carried out and relevant certifications are issued. Drydockings for containerships are generally required once every three to five years.

F

Freight rate
The amount charged by container shipping companies for transporting cargo, normally as a rate per 20-foot or 40-foot container.

G

Geared Container ships
Containerships that do not need to rely on port cranes for loading and unloading since they are equipped with cranes or derricks for loading and unloading containers and other cargo operations.
Gross ton
A unit of measurement for the total enclosed space within a ship equal to 100 cubic feet or 2.831 cubic meters.

H

Headhaul
The outgoing voyage of a vessel from port of origin to its ports of destination. Headhaul usually refers to the stronger or dominant leg of a round-trip voyage attracting the greater volume of cargo relative to the weaker backhaul leg.
Hull
Shell or body of a ship.

I

IMO
International Maritime Organization, a United Nations agency that issues international standards for shipping.
Intermediate survey
The inspection of a ship by a classification society surveyor that takes place 24 to 36 months after each Special Survey.

N

Newbuilding
A new ship under construction or just completed.

O

Off-hire
The period in which a ship is not available for service under a time charter and, accordingly, the charterer generally is not required to pay the hire rate. Off-hire periods can include days spent on repairs, drydocking and surveys, whether or not scheduled.

P

Protection and indemnity insurance
Insurance obtained through a mutual association formed by shipowners to provide liability indemnification protection from various liabilities to which they are exposed in the course of their business, and which spreads the liability costs of each member by requiring contribution by all members in the event of a loss.

S

Scrapping
The sale of a ship as scrap metal.
Ship management
The provision of ship operating services relating to crewing, technical and safety management (including maintenance and repair) and the compliance with all government, flag state, class certification and international rules and regulations.
Ship operating expenses
The costs of operating a ship, primarily consisting of crew wages and associated costs, insurance premiums, ship management fees, lubricants and spare parts, and repair and maintenance costs. Ship operating expenses exclude fuel cost, port expenses, agents'fees, canal dues and extra war risk insurance, as well as commissions, which are included in voyage expenses.
Sister ships
Ships of the same class and specifications with similar performance typically built at the same shipyard.
Special survey
The inspection of a ship by a classification society surveyor that takes place every five years, as part of the recertification of the ship by a classification society.
Spot market
The market for immediate chartering of a ship, usually for single voyages.

T

TEU
20-foot equivalent unit, the international standard measure for containers and containership capacity. A 20ft container is one TEU and a 40ft container two TEUs.
Time charter
A charter under which the shipowner hires out a ship for a specified period of time with the shipowner providing the crew and paying ship operating expenses while the charterer is responsible for paying the voyage expenses and additional voyage insurance.

V

Voyage charter
A charter under which a shipowner hires out a ship for a specific voyage between the loading port and the discharging port. The shipowner is responsible for paying both ship operating expenses and voyage expenses. Typically, the charterer is responsible for the cost of any delay at the loading or discharging ports. The shipowner is paid freight on the basis of the cargo movement between ports.
Voyage expenses
Expenses incurred for a ship's traveling from a loading port to a discharging port, such as bunkers cost, port expenses, agent's fees, canal dues, extra war risk insurance and commissions.

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