Terminal handling charges in air freight are the fees a ground handling agent bills for moving your cargo through the airport terminal: receiving it, warehousing it, screening and documenting it, and loading or unloading it from the aircraft. They apply twice on almost every shipment, once at the origin airport and again at the destination, and the amount is driven mainly by the chargeable weight of the cargo plus any surcharges for difficult freight. Rates vary by airport, by handler, and by the type of goods, which is why two shipments of identical weight on the same lane can carry noticeably different handling bills.
What the Charge Actually Pays For
Most of the fee covers physical work on the ground. Crews move freight from the receiving dock into a warehouse, stage it, and build it into Unit Load Devices, the standardized containers and pallet-net combinations that fit specific aircraft.1IATA. Unit Load Devices (ULD) At the destination, that whole process runs in reverse: unload, break down the ULDs, sort for pickup.
The rest covers paperwork and compliance. The handler prepares the Air Waybill, which functions as both receipt and contract of carriage, and compiles the manifest customs uses to verify what’s on the flight.2Maersk. Air Waybill (AWB) Basics: Guide to its Functions and Usage Cargo also has to be screened under the TSA’s Certified Cargo Screening Program, which requires piece-level screening and chain-of-custody tracking before anything reaches the aircraft.3Transportation Security Administration. TSA Air Cargo Security Certified Cargo Screening Program
How the Amount Is Calculated
Chargeable weight is the main driver. Carriers compare the actual gross weight against the volumetric weight and bill on whichever is higher. The standard IATA volumetric formula is length × width × height in centimeters divided by 6,000, which assumes a density of 167 kilograms per cubic meter. A bulky but light shipment, foam packaging being the classic example, will almost always be billed on volume rather than scale weight.
Per-kilogram rates themselves vary widely. A handler’s published tariff in one region may run just a few cents per kilo, while busy hubs and specialized facilities charge considerably more. Most handlers also set a minimum charge per Air Waybill, so small shipments don’t get the benefit of low per-kilo pricing.
Cargo type adds surcharges on top of the base. Hazardous materials need dedicated storage and separate documentation. Perishables trigger higher fees to cover temperature-controlled infrastructure. Oversized freight that won’t fit a standard ULD needs custom equipment and extra labor. The exact premium depends on the handler and the complexity of the job, but it can increase the total handling fee substantially.
Origin and Destination Both Get Billed
The Origin Terminal Handling Charge, usually written as OTHC, covers everything on the export side: receiving cargo from the trucker, warehousing, export documentation, security screening, and loading onto the aircraft. The Destination Terminal Handling Charge, DTHC, covers unloading, breakdown of the ULDs, and moving freight into a bonded warehouse to await customs clearance.4U.S. Customs and Border Protection. U.S. Customs and Border Protection Bonded Warehouse
The two amounts are often different, even at the same airport, because the labor and procedures involved in export versus import handling aren’t identical. Budget for both.
Who Pays: It’s in the Incoterm
Which party owes the terminal handling charges depends on the Incoterms rule in the sales contract. Incoterms are the 11 internationally recognized trade rules published by the International Chamber of Commerce that assign costs and risks between seller and buyer.5International Trade Administration. Know Your Incoterms The current edition is Incoterms 2020, and each rule lists its associated costs at articles A9/B9 so both sides can see what they’ve agreed to.6International Chamber of Commerce. Incoterms 2020
Two rules sit at the extremes:
- Under EXW (Ex Works), the buyer covers everything from the seller’s door onward, including terminal charges at both the origin and destination airports.
- Under DDP (Delivered Duty Paid), the seller bears every cost through to the buyer’s named location, including both terminal charges, duties, and taxes.
Most air shipments use something in between. Under FCA (Free Carrier), for instance, the seller delivers cargo to a named airport and covers the OTHC; the buyer picks up everything from that point. The scenario to avoid is a contract that doesn’t specify an Incoterm at all. Cargo can sit at a terminal with nobody willing to pay, and the handler has no obligation to release it until someone does.
Free Time, Then Storage Fees Start
Every terminal grants a window of free time after cargo arrives before storage charges begin. At most airports that window currently runs around 24 hours. The handler sets both the length of the free time and the moment the clock starts, not the airline or the airport authority.
Once free time ends, storage fees accumulate daily based on the cargo’s weight and how long it stays. Heavy shipments rack up charges quickly. Under U.S. customs rules, imported merchandise that goes unclaimed for 15 days after arrival is designated as General Order cargo and can be moved to a separate facility at the owner’s expense and risk.4U.S. Customs and Border Protection. U.S. Customs and Border Protection Bonded Warehouse Arrange customs clearance and pickup before the shipment lands, not after. Fees are rarely negotiable once assessed.
Ancillary Fees That Aren’t in the Base Rate
The base terminal handling charge doesn’t always cover everything a shipment needs. Several services are billed separately:
- Relabeling and repackaging when cargo arrives with damaged packaging or non-compliant labels. Expect per-carton or per-pallet charges.
- Sorting and segregation when shipments need to be split by purchase order, destination, or product type before loading.
- Customs examination moves. If CBP selects a shipment for physical inspection, it may need to be transported to a Centralized Examination Station, and that move plus any repacking afterward falls on the cargo owner.
- Special equipment such as cranes, heavy-lift rigs, or oversized dollies for freight that exceeds standard handling capacity, charged at premium rates.
These items don’t always appear in the initial freight quote. Ask your forwarder for an itemized breakdown that separates base THC from potential add-ons.
What Happens if Charges Go Unpaid
Ground handlers don’t release freight on trust. Under the Uniform Commercial Code, a carrier has a lien on goods in its possession for unpaid charges, including terminal charges and demurrage, and for expenses needed to preserve the goods.7Legal Information Institute. UCC 7-307 Lien of Carrier Against a purchaser holding a negotiable bill of lading, the lien is limited to charges stated in the bill or the applicable tariff, but in most air freight situations the handler’s position is strong. The handler can hold the cargo until the bill is paid.
If cargo sits long enough, storage penalties pile up on top of the original handling fees, and in extreme cases the goods can eventually be sold to recover what’s owed. The more common outcome is less dramatic but still costly: a shipment held for a week or two while the shipper, consignee, and forwarder argue over who should pay. A clear Incoterm in the sales contract and confirmed payment arrangements before cargo ships are the only reliable ways to prevent this.
One Boundary Worth Knowing
Terminal handling charges pay for the handler’s work. They are not insurance. If cargo is damaged in the terminal, recovery is capped by the Montreal Convention at 26 Special Drawing Rights per kilogram, roughly $35 per kilogram at current exchange rates, regardless of what the goods are actually worth.8ICAO. International Air Travel Liability Limits Set to Increase, Enhancing Customer Compensation For high-value, lightweight cargo such as electronics or pharmaceuticals, paying the THC does not protect the shipment’s value. Separate cargo insurance is the only way to close that gap.