Master Lease is a general agreement signed between the suppliers and Shipping lines. It may or may not specify the lease period or quantity but will have all the Commercial and General Terms.

In the case of leasing company containers multiple handlings are done by the depot to carry out repairs – from off-hire- offhire survey/ re-survey when disputed/ taking to repair stack, repair/ on-hire survey to loading. So most leasing companies just agree on one handling charge to cover these multiple internal handling unlike shipping lines that pay per handling activity.

The six month period provided by the customs to give the container operator time for the following activities- import, free days to consignee, movement to ICD for loading, repair for export etc. Carriage of domestic cargo during this period is illegal.

“Caps” is a location wise per month limit given to the customer for off-hiring containers. The “Caps” are based on two criteria:
- The total volume on lease
- The pickup locations

This is a cover taken by the container user for third party liability. This could be damage that occurs in transit where there is damage to the public or property etc.

Any container can be sold as per agreement terms once the ‘domestication’ is done.

“Drop off charge” is the cost that applies at the time of off-hiring a unit. This is to compensate on the container idling cost incurred due to the repair cycle. As per contract, the customer is obliged to return the containers in IICL condition. But since leasing companies accept containers back in the depot in ASIS condition, they are effectively stopping the rentals early and bearing the storage cost on the customer’s behalf during the whole repair cycle. Hence the DOCH.

Buying and selling of marine containers – mostly older containers.

Domestic containers are available on short term and long term leases depending on the agreement between the leasing company and lessee.

This is a commonly accepted practice in the container leasing industry. Master lease agreements are only a preparation for the event when containers may be required. There is no obligation for the lessee to actually lease or pay any charges unless the containers are taken ‘on hire/picked up “. The charges are only payable from the date of use of equipment. It is common to sign agreements anticipating requirements even though they may not be put into use. However, having an agreement in place ensures quick mobilisation and on hire without having to rush through the credit process, agreements of terms etc.

The leasing company sometimes gives incentives in the form of credit to a lessee when they pick up a container from a very bad location (i.e., where containers are idling with no prospect for lease). Hence ‘PUCR’ is paid to the lessee for helping move containers out of such locations.

All lessees are obliged to take an insurance cover for the equipment on hire to them for total loss and public liability.

All the shipping line or NVOCC file a customs bond (currently equivalent to Rs.20, 000 per TEU) for some total volume (say 500Teus at one port). If they import 400Teu at a time, then the balance they can import will be only 100Teus unless they re-export the earlier lot of 400Teus. Hence re-export details are provided to the customs to cancel the bond so they can bring in more imports. (re-export details are Vessel name – voyage – PC number and date).

The customs law allows domestication after payment of appropriate duty. But the operational part of doing it in most ports is very cumbersome and bureaucratic with no clear guidelines of how this can be done.