Understand the differences between shipowner, NVOCC, and shipping agency

  • 17/09/2019
  • 9 minutes

The differences between shipowner, NVOCC, and shipping agency may have caused many doubts in those who are not completely used to the foreign trade universe. After all, what are the peculiarities of each? In what ways can they contribute?

With that in mind, we prepared a very special article about it. As you read it, you will learn the specifications of these activities and the benefits they provide for different types of business. Follow the content to the end and don’t miss any details!

What is the routine like in a NVOCC?

Because this topic is so deep, we talked to an expert on the subject in order to approach it with the necessary expertise. We interviewed Rogerio S. Fadigas, who is the director of CARGOFAST Logistics do Brasil Ltda, an organization with extensive experience in international logistics.

According to him, a NVOCC such as CARGOFAST is in frequent contact with shipowners and their shipping agencies. In detailing its routine and approach with these other players, he mentions the importance of agility, attention, and precision in the daily tasks of the employees of these companies.

“With the coming of the internet,” he contextualizes, “the main channel of communication is the website of the shipping companies, which serve to request reservations and check ship schedules and their respective deadlines.” In addition, he also draws attention to other media such as email, phone, and even WhatsApp, which is very useful for urgent matters.

As the expert sees it, both shipowners and the agencies have been striving to improve service delivery through streamlined training and processes. “For us, what really makes a difference is that personal touch — being able to count on employees who always show commitment, professionalism, and willingness to serve well,” he adds.

What are the most common misunderstandings between shipowner, NVOCC, and shipping agency?

According to Fadigas, people have many misunderstandings between shipowner, NVOCC, and shipping agency: about who does what and what are the roles played by these different elements in the foreign trade scenario. “Confusion increases when the professionals involved need to get information about the International Commercial Terms, the INCOTERMS,” he points out.

There are companies that usually leave all functions to the NVOCC, regardless of the INCOTERM used. “There was a shipment in which we almost lost the ship, because the tasks that were the responsibility of the dispatcher and the road carrier were entrusted to us. In order to not create any friction, we accumulated the functions and kept the customer for a long time, although it was not the proper way of working”, he reports.

The most troublesome result of these confusions is process delays and other oversights that can lead to major complications and generate extra costs or losses — keeping a container stored in port, for example.

What are the differences between them?

See below the main functions performed by these different players of international freight transport.


A NVOCC, or Non-Vessel-Operating Common Carrier, can be defined as a shipowner without a ship, who issues its own Bill of Lading (BL), one of the most relevant documentations for the industry.

“In a nutshell, a NVOCC is a common carrier that offers itself to the public to provide maritime transport, but does not operate the ships on which the transport is performed,” conceptualizes Fadigas. Because of this role, it assumes all responsibilities alongside the shipping companies: freight payment, port dues, detention and demurrage costs, among others.

Shipowner or shipping company

Shipowners or shipping companies are a group of people or a company that uses ships commercially, that is, to make a profit, whether or not they own the means of transport.

According to Fadigas, “the shipowner’s main activity is to provide the ship so that exporters, importers, and NVOCCs transport their goods”. They also issue a bill of lading and have their own trading team, which serves BCOs (exporters or importers) directly or indirectly through the NVOCCs.

Shipping agency

Shipping agencies are organizations designated by shipowners to represent them in their interests, duties, and obligations in ports before the port authorities. The agents must meet the needs and requirements of the ship’s crew, such as receiving mail, making repairs as needed, and providing water and food replenishment.

The agency may also undertake a number of activities related to international transportation, such as:

  • issue the BL, if the shipowner cannot do so;
  • receive local BL clearance fees;
  • control container inventory;
  • manage the detention and demurrage time of containers;
  • release empty containers;
  • take care of container maintenance and repair.

Do other elements exist? What are they?

According to the specialist, the list of players in this commercial context is not limited to the shipowner, the NVOCC, and the shipping agency, because there is another element that is essential at various times: the cargo agent.

The cargo agent, also known as freight forwarder, fulfills the role of arranging space reservations and negotiating freight with shipping companies on behalf of the BCOs. In addition, he or she takes care of shipment coordination, which includes:

  • removal of empty containers;
  • preparation of the BL draft;
  • compliance with deadlines between the BCOs, the companies, and the boarding or unloading terminals;
  • preparation of the necessary documentation for the loading or unloading of goods;
  • customs clearance service, in some cases.

Typically, an exporter or importer will need the services of this type of professional to manage shipment and handle all documentation and shipping requirements. It’s worth noting that negotiating freight contracts, monitoring cargo movement, and port inspection are also part of their routine.

Finally, there is no doubt that the freight forwarder, the shipowner, the NVOCC, and the shipping agency are relevant elements that play different roles in foreign trade and international cargo transportation. In order for the negotiation to be realized and all to obtain the expected return, it is essential to count on the contribution of each of these players.

If you enjoyed the content, take the opportunity to understand more about shipping agencies and its operations and documentation!