--- title: "What Is a Freight Forwarder?" url: https://www.uncap.com/glossary/freight-forwarder author: "Denis Dyli" published: 2026-10-22 updated: 2026-10-22 summary: "A freight forwarder is a business that, for compensation, takes responsibility for moving a shipper's goods from the place of receipt to the destination. It assembles and consolidates shipments, handles break-bulk and distribution, and uses a carrier for at least part of the move. Ocean freight forwarders book cargo space and process the export documents." --- # What Is a Freight Forwarder? > A freight forwarder is a business that, for compensation, takes responsibility for moving a shipper's goods from the place of receipt to the destination. It assembles and consolidates shipments, handles break-bulk and distribution, and uses a carrier for at least part of the move. Ocean freight forwarders book cargo space and process the export documents. **Freight forwarder**: A freight forwarder is a business that, for compensation, takes responsibility for moving a shipper's goods from the place of receipt to the destination. It assembles and consolidates shipments, handles break-bulk and distribution, and uses a carrier for at least part of the move. Ocean freight forwarders book cargo space and process the export documents. ## How it works Federal law defines a freight forwarder in the transportation code at 49 U.S.C. 13102 and, for ocean exports, at 46 U.S.C. 40102. Under 49 U.S.C. 13102, a freight forwarder holds itself out to the general public, other than as a pipeline, rail, motor or water carrier, to provide transportation of property for compensation. In the ordinary course of its business it: - Assembles and consolidates shipments, or provides for that, and performs or provides for break-bulk and distribution - Assumes responsibility for the transportation from the place of receipt to the place of destination - Uses, for any part of the transportation, a carrier subject to jurisdiction under that subtitle of the US Code Under 46 U.S.C. 40102, an ocean freight forwarder is a person in the United States that dispatches shipments from the United States via a common carrier, books or otherwise arranges space for them on behalf of shippers, and processes the documentation or performs related activities for those shipments. ## What a forwarder does Federal Maritime Commission rules list freight forwarding services for ocean exports. They may include: - Ordering cargo to port - Preparing or processing export documents, including the required electronic export information - Booking, arranging for or confirming cargo space - Preparing or processing common carrier bills of lading or other shipping documents - Arranging for warehouse storage and cargo insurance - Assisting with clearing shipments under US government export regulations - Coordinating the movement of shipments from origin to vessel **Where an ocean freight forwarder sits in an export** ### 1. Book, Space on a carrier The forwarder books or arranges cargo space on a common carrier on behalf of the shipper. ### 2. Documents, Export paperwork It prepares or processes export documents and common carrier bills of lading. ### 3. Move, Origin to vessel It orders cargo to port and coordinates the movement of the shipment from origin to vessel. ## Types of freight forwarders - Freight forwarder under 49 U.S.C. 13102. Registers with the Secretary of Transportation under 49 U.S.C. 13903 and uses a carrier for at least part of the move. - Ocean freight forwarder (OFF). Dispatches US exports and handles their documentation. Under 46 U.S.C. 40102, ocean freight forwarders and non-vessel-operating common carriers (NVOCCs) together are ocean transportation intermediaries (OTIs). An NVOCC is the other kind of OTI: a common carrier that does not operate the vessels that provide the ocean transportation, and is a shipper in its relationship with an ocean common carrier. ## Freight forwarder vs. freight broker A freight broker arranges transportation by an authorized motor carrier for compensation, and it may not provide the transportation itself as a motor carrier unless it registers separately as one. A forwarder holds itself out to provide the transportation itself and assumes responsibility for it from receipt to destination, while using a carrier for at least part of it. Under the transportation code, both register with the Secretary of Transportation, brokers under 49 U.S.C. 13904 and freight forwarders under 49 U.S.C. 13903, and both must file financial security, such as a surety bond or trust fund, under 49 U.S.C. 13906. ## Example An outdoor furniture manufacturer ships 400 chairs from the United States to a dealer abroad. It hands the export to a licensed ocean freight forwarder. The forwarder books space on an ocean carrier, prepares the export documents and the carrier's bill of lading, and arranges cargo insurance. In this illustration, the manufacturer pays the forwarder $3,600 for the job. Spread across 400 chairs, that is $3,600 / 400 = $9 a chair of forwarding cost on this order. ## On Shopify In its guide to collecting duties and import taxes at checkout, Shopify says every international order requires a commercial invoice, and that you can fill out digital commercial invoices provided by the carrier on the carrier's website. Each physical product also has fields for its country or region of origin and its Harmonized System (HS) code, which customs uses to apply the correct tariffs. ## How Uncap helps On Uncap's [tile and stone distributors page](/industry/tile-stone), special order and import programs add a second clock, because the container a buyer wants may not be in the building yet. Showing incoming lots against their purchase orders, so a buyer can reserve from a shipment still on the water, is built during implementation. ## Related terms - Freight broker - Commercial invoice - Bill of lading - Incoterms - Landed cost - 3PL (third-party logistics) ## Sources - 49 U.S.C. 13102, Definitions (Cornell LII) - 46 U.S.C. 40102, Definitions (Cornell LII) - 46 CFR 515.2, Definitions (Cornell LII) ## Frequently asked questions ### What do you mean by freight forwarders? A freight forwarder is a business that takes responsibility for moving goods for a shipper. It consolidates shipments and uses carriers for the move; for ocean exports, it books cargo space and processes the shipping documents. ### Do you need a license to be a freight forwarder? For ocean freight, yes: a person in the United States may not act as an ocean transportation intermediary without a license from the Federal Maritime Commission, although a business whose primary business is selling merchandise may forward its own shipments without one. Freight forwarders under 49 U.S.C. 13102 register with the Secretary of Transportation. ### Can a freight forwarder be a customs broker? Only with a customs broker's license. Under 19 U.S.C. 1641, no person may conduct customs business, other than solely on its own behalf, unless it holds a valid customs broker's license.