Carrier in Logistics: Meaning, Types and Liability

In logistics, the meaning of carrier is the company or person that actually transports goods for a customer and answers for them while they are on the move. Carriers work by road, rail, sea or air: in road freight the carrier is the haulier whose truck moves the load, at sea it is the shipping line, in the air the airline. Usually, carriers work with shippers, directly or through a freight forwarder, to move products from one location to another.

Carrier, shipper and freight forwarder

Three parties are easily mixed up. The shipper hands over the goods and is named as sender on the consignment note. A freight forwarder organises the transport for a customer and buys the capacity it needs, often from carriers. The carrier performs the carriage itself, with its own trucks and drivers or through subcontractors. A forwarder that undertakes the carriage, rather than only arranging it, is the carrier under that contract.

Subcontracting does not move the responsibility. Under the CMR Convention, which governs international road carriage, the carrier is responsible for the acts and omissions of any other persons whose services it uses for the carriage, as if they were its own. A carrier that passes a load to a subcontractor therefore still answers to its customer.

Types of carrier

• Common carrier: a transport provider that offers to carry goods for any individual or business, rather than for selected customers only.
• Contract carrier: a business or individual that regularly carries goods for particular shippers under contracts with agreed terms for a set period, which either party can renegotiate or end as the contract allows.

The two terms come from English and American law. In European road freight the more common split is between work under a framework contract with fixed rates and spot loads booked per job, for example through a freight exchange.

What a road carrier is liable for

On international road transport, the CMR sets the carrier's liability. The carrier is liable for total or partial loss of the goods and for damage to them between taking them over and delivering them, and for delay in delivery. For loss, compensation is limited to 8.33 units of account, the IMF's special drawing rights, per kilogram of gross weight short, unless a higher value was declared. That is why the carrier checks, when taking over the goods, the number of packages and their marks and the apparent condition of the goods and packaging, and enters reasoned reservations on the consignment note where something is wrong.