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What Is an NVOCC in Shipping?

May 12, 2023 Kevin Baxter

Container Port

The letters NVOCC stand for non-vessel operating common carrier. Beyond deciphering what each letter represents, NVOCC's meaning in shipping then, is a company that acts as an ocean carrier - providing all the relevant services - but that does not own equipment. The 'n' is an important distinction here, as traditional ocean carriers are known as VOCCs, or vessel operating common carriers. That means the difference between an NVOCC and a shipping line largely comes down to physical ownership, since both are involved in transportation of goods.

Taking that a step further, the NVOCC buys or leases container space to perform the same functions as a traditional carrier. And importantly, it looks just like a traditional carrier to a shipper as it is a tariff publisher and uses its own House Bill of Lading in customer agreements. Because of this, some refer to them as "virtual carriers." There are more layers to exactly what constitutes NVOCCs and how they also relate to freight forwarders.  

NVOCC or Freight Forwarder

An NVOCC and freight forwarder can be one in the same, but that is not always the case. Some freight forwarders can be NVOCCs, but there are also freight forwarders that are not.

Further, an NVOCC can be unaffiliated with a freight forwarding company, while a freight forwarder can be a partner or agent for an NVOCC. To become an NVOCC in the United States and obtain a license, a company must register with the Federal Maritime Commission (FMC) and maintain proof of financial responsibility with a required NVOCC bond.

Ocean freight forwarders must also register with the FMC, but they have different requirements. The FMC, in fact, keeps a regularly updated freight forwarder and NVOCC list. Both are considered ocean transportation intermediaries or OTIs by the Commission. Also of note: NVOCC license requirements involve several years of working in freight forwarding prior to application.

Freight Forwarder vs. NVOCC

Comparing a freight forwarder vs. NVOCC starts best with a definition. A freight forwarder is essentially a company that contracts with a carrier - or carriers - to help coordinate shipments for its business customers - aka shippers.

The forwarder serves as the shipper's agent in these transactions. As noted previously, an NVOCC is considered a carrier, while a freight forwarder (unless it is an NVOCC) is not. That means an ocean freight forwarder must work with an NVOCC (or VOCC) to move cargo.

Freight forwarders cover all modes of transportation, while NVOCCs are ocean-focused. And since they are ocean-focused, NVOCCs don't handle domestic shipping, while freight forwarders do. To get even more in the weeds, freight forwarders can be domestic-only, and thus, not registered as ocean freight forwarders.

So in all, when it comes to an NVOCC vs. freight forwarder,  while there is some - or even potentially a lot of - overlap, they are certainly distinct in their designations, ability to work between freight modes, domestic capabilities, documentation and licensing among other factors.

Need more information on NVOCCs or just need help with your international shipping strategy? Just drop us a line and we'll be happy to follow up. If you're looking for more information on freight and logistics - and us - read through our free Freight Guides

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