QUESTION OF THE WEEK: What Is Shipper-Owned Container? (2)

By Hari Menon


Benefits of Shipper-Owned Container (SOC)

SOC means that the shipper does not have to worry about container availability with the carrier to ship his cargo, especially during peak seasons or at times when empty containers are not available in the market. The shipper with a SOC has to just book his space on the freight carrier.

When a container is owned by the shipper, he has control over the clearance of the cargo. Also, the question of returning the empty container does not arise as the container is owned by him. The shipper can decide and arrange the exact date of clearance thereby avoiding demurrage charges.

What is COC?

On the other hand, we have the COC or the Carrier-Owned Container. As the name implies, carrier-owned containers are owned and operated by carriers. They may also have been leased from container leasing companies by these carriers.

Some advantages of using Carrier-Owned Containers are given here.

Once the de-stuffing of cargo is complete and the empty container is returned, the customer does not have to worry about its storage or maintenance.

COC may be obtained at discounted rates when there is a surplus of empty containers at a location, such as a very remote location or those located in a war-zone, etc.

This imbalance often happens when cargo containers after unloading, are not shipped back to locations with demand, on time. By giving discounted rates, the carrier helps to move empty containers away from such locations with a surplus.

Identification of Shipper-Owned Containers

The container number is a container’s main identification code. It is a unique alphanumeric combination consisting of four letters and seven numbers.

Containers the world over are identified by their container numbers. By international customs regulations, it is mandatory for each container to have a registered container number.

Examples of container numbers are WHLU0291165, GLDU2038114, MSKU9342870, etc. The first three letters identify the owner of the container.

The next letter (the fourth) is a product-group code used to identify the equipment. Here the ‘U’ denotes an intermodal container.

The next 6 digits are the unique container registration number and the seventh digit is a check digit used to confirm the accuracy of the preceding sequence.

However, when a container is acquired to be used as a SOC, the new owner is required to change the original container number by changing at least the first three letters (in place of WHL, GLD, MSK, etc. in the above examples).

A new prefix can be obtained by registering with the BIC. Though some SOC owners add prefixes such as XXXU, NONU, etc. to their containers it may not be recognized by customs of certain countries that can lead to problems during a voyage.