A dented package, wet carton or shortage against the packing list may be a minor packaging issue—or evidence of impact, water ingress, cargo shift, theft or a handover discrepancy. The greatest risk is often not the physical loss itself, but continuing to unload, signing a clean receipt, discarding packaging or notifying too late, thereby breaking the evidence chain. When an exception is found, the first objective is not to argue liability. It is to protect people, preserve the condition, record a precise exception, notify the correct parties and mitigate further loss. This article sets out an operational process from discovery through survey, loss quantification, claim submission and case closure.

Prepared by TGIMEX · Updated 21 July 2026 · B2B cargo-loss management guidance

QUICK FACTS

Stop and preserve

Do not move, open or discard evidence where that may destroy traces; human safety and dangerous-goods controls come first.

Record the exception at receipt

Match seal, package count, marks and packaging condition; write a precise reservation on the POD, tally or exception report rather than signing clean.

Notify in parallel

Send preliminary notice to the carrier/forwarder, warehouse/terminal, seller and insurer/broker; do not wait for a final repair quotation.

Protect claim rights

Arrange survey where appropriate, mitigate reasonably, retain cargo/packaging/samples and control every contractual, policy and legal deadline.

Illustration for Cargo Dented, Wet or Missing Packages: What Should a Business Do? — Illustration of the logistics topic, document or operation discussed in the article.

SCOPE OF APPLICATION

This article applies to import and export cargo moved by sea, air, road or multimodal transport, including FCL, LCL, air cargo, pallets and individual packages. It addresses physical damage and shortage discovered at a port, CFS, cargo terminal, warehouse or delivery point. It does not replace emergency procedures for dangerous goods, unsafe food, pharmaceuticals, temperature-sensitive cargo, cargo under authority seal or suspected criminal activity.

KEY TERMS

Term	Meaning	Operational role
Apparent damage	Visible damage at handover, such as dents, tears, wetting, breakage or missing packages.	Should be recorded at delivery whenever the circumstances permit.
Concealed damage	Damage found only after opening packaging or inspecting internal contents.	Retain packaging and stow position and notify immediately after discovery; notice rules may differ from visible damage.
Shortage / Short delivery	Packages, weight or quantity delivered are below the transport or commercial record.	Distinguish a missing whole package, internal shortage and document error.
Reservation / Exception remark	A qualification on a POD, EIR, tally or receipt describing the condition.	Creates time-stamped evidence that receipt was not accepted as sound and complete.
Survey	Independent or insurer/carrier-appointed inspection.	Records condition, possible cause, extent and mitigation; it does not by itself determine legal liability.
Mitigation / Sue and labour	Reasonable action to prevent loss from spreading or increasing.	May include segregation, weather protection and controlled drying/repacking, with evidence of cost and condition.
Subrogation	An insurer’s recovery right after indemnification, subject to law and contract.	The insured should not release responsible parties or destroy evidence in a way that prejudices recovery.

OPERATING PRINCIPLE

A cargo claim commonly involves at least four parallel relationships: the sale contract, contract of carriage, logistics/warehouse service contract and cargo insurance contract. Incoterms identifies delivery, risk transfer and insurance obligations between seller and buyer, but does not decide whether the carrier is liable. Carrier liability depends on the transport document, conditions of carriage and applicable convention or law. Insurance recovery depends on insured perils, exclusions, deductible, causation and the insured’s duties. Businesses should therefore notify all potentially relevant parties first and allocate responsibility only after the evidence has been reviewed.

APPLICATION NOTE: Do not wait for a final cause or exact amount before sending preliminary notice. Many contracts and transport regimes contain short notice periods or time bars. The applicable deadline must be taken from the actual B/L or AWB, contract, policy, route and governing law.

ANALYSIS / DECISION MATRIX

Indicator	Immediate action	Key evidence	Do not conclude too early
Dented, torn or deformed package	Quarantine; photograph all sides, pallet and stow position; inspect contents under control; state the number and severity of affected packages.	Reserved POD/tally, pre-movement photos, packaging, dunnage, shock/tilt indicator, QC or functional-test record.	Dented packaging does not mean the entire product value is lost; intact packaging does not exclude concealed damage.
Wet carton, pallet or cargo	Stop further water ingress; map wet areas; measure moisture/temperature where relevant; retain water/material samples if requested.	Water tracks, roof/wall/floor photos, seal, weather, logger, moisture readings, samples and salvage records.	Do not label the source as seawater, rain or condensation based only on appearance.
Missing packages at handover	Pause tally; recount by marks/lot; reconcile seal, container/ULD, HBL/MBL or HAWB/MAWB, manifest and warehouse records.	Outbound/inbound tally, seal record, EIR, CCTV, weights/scans, POD, packing list and opening record.	An intact seal does not prove cargo completeness; shortage may predate sealing or result from data error.
Seal missing, mismatched or tampered	Do not open unilaterally in a controlled area; alert carrier/terminal and authorities where required; arrange witnessed opening.	Seal and locking-bar photos, document seal number, EIR, CCTV, exception report and witness list.	Do not assume theft before excluding clerical error, authorized resealing or documented inspection.
Leaking package or suspected dangerous goods	Isolate the area, do not touch or smell, use PPE and SDS, and call the safety/emergency team.	SDS, UN number, labels/marks, safe-distance photos and incident record.	Safety of people and the environment takes priority over claim evidence.

DOCUMENTS AND EVIDENCE TO CHECK

Document/evidence	Source or preparer	Fields to preserve	Purpose
POD, EIR, warehouse receipt, tally sheet	Carrier, terminal, CFS, warehouse or receiver	Date/time, location, vehicle/container/ULD, seal, package count, exact remark, signatures/witnesses.	Shows condition at the custody-transfer point.
Site photos and video	Receiver, warehouse or surveyor	Overview to close-up, scale, marks/labels, seal, stow position, original file and timestamp.	Reconstructs condition and scope.
Transport documents	Carrier/forwarder	B/L, sea waybill, AWB, HBL/MBL, HAWB/MAWB, booking and conditions of carriage.	Identifies parties, route, carriage terms and time bars.
Commercial documents	Seller/buyer	Contract/PO, invoice, packing list, specifications, Incoterms and named place.	Defines what was due, value, quality and sale-contract risk allocation.
Insurance documents	Insurer/broker/policyholder	Policy/certificate, clauses, insured value, deductible, voyage, interest and claims instructions.	Defines coverage and insurer documentation requirements.
Survey/QC records	Surveyor, QA/QC, repairer or laboratory	Possible cause, affected quantity, repair/salvage potential, samples and test method.	Quantifies loss and mitigation options.
Loss calculation	Finance, procurement, QA and survey/insurance teams	Invoice value, tax treatment, repair/repacking, salvage, disposal, quantity loss and credit notes.	Supports the actual recoverable amount without double counting.
Notice/correspondence log	Claim owner	Recipient, time, subject, attachments, response and reservation of rights.	Proves timely notification and case control.

RESPONSE AND CLAIM PROCESS

Step	Action	Required output	Control point
1. Make safe and stop cargo flow	Isolate the area and pause unloading/put-away at the exception point; activate specialist SOP for leakage, odour, batteries, chemicals or temperature excursion.	Safe area and documented go/no-go decision.	Do not open or handle dangerous cargo without SDS and competent personnel.
2. Preserve condition and record exception	Photograph before movement; inspect seal; make an initial count; place a precise reservation on POD/tally/EIR and record refusal if the delivering party will not sign.	Initial photo set and qualified receipt.	Do not write only “damaged”; state packages, location, damage type and seal condition.
3. Send immediate preliminary notice	Notify carrier/forwarder, terminal/CFS/warehouse, seller, insurer/broker and other relevant parties; reserve the right to quantify later.	Notice with shipment ID, description, discovery date, photos and survey request.	Do not wait for a complete final dossier.
4. Arrange survey and chain of custody	Agree surveyor, attendees and scope for opening/sampling; seal samples and record every movement.	Survey attendance, sample log and opening record.	Do not discard packaging or salvage before necessary inspection/approval.
5. Mitigate further loss	Protect, segregate, dry/repack, maintain cold chain or make temporary repairs under competent guidance; retain invoices and before/after evidence.	Mitigation log and supported reasonable costs.	Mitigation must not create extra hazards or erase causation evidence.
6. Reconcile and quantify	Conduct full tally or agreed sampling; classify sound/damaged/suspect/missing; perform functional or laboratory testing where needed.	SKU/lot/package reconciliation and QC/survey report.	Separate physical loss from commercial discount, delay or lost profit.
7. Compile and submit claim	Submit claim letter, transport documents, invoice, packing list, reserved POD, survey, photos, loss calculation and notice log.	Indexed claim package with amount, basis and contact.	Carrier and insurance claims may proceed in parallel, but recovery cannot exceed the actual loss.
8. Follow through and close	Answer queries, manage salvage/credit notes, settle or challenge rejection, preserve recovery rights and record root cause/CAPA.	Settlement/rejection record, accounting treatment and lessons learned.	Do not sign a release broader than the approved settlement.

MODE-SPECIFIC CONTROLS

Handover scenario	Additional controls	Typical parties to notify/attend	Often-missed evidence
Sea FCL delivered as a full container	Seal, EIR, container condition before opening, opening video, stowage and container damage.	Carrier/forwarder, terminal/trucker, consignee and surveyor; authorities where procedure requires.	Closed-door photos, water tracks, roof/wall/floor, dunnage and package position.
Sea LCL at CFS	Marks, HBL/MBL link, devanning tally and package condition before release.	CFS, consolidator/NVOCC, consignee and surveyor.	Master-house tally, devanning photos and over/short/damaged report.
Air cargo terminal	HAWB/MAWB, ULD, cargo receipt, warehouse discrepancy report and handling history.	Airline/ground handler, forwarder, consignee and insurer.	Weight/scan data, terminal damage report and photos before truck loading.
Road delivery to warehouse	POD, seal, route, vehicle, body/tarpaulin condition, stop history and warehouse CCTV.	Trucker, warehouse, consignee and forwarder.	Photos on vehicle before unloading, truck floor/body and count/weight record.
Temperature-sensitive cargo	Set point, logger, off-power periods, product temperature and quarantine decision.	Carrier/terminal, QA, surveyor, insurer and product specialist.	Original logger file, plug/unplug events, probe method and sample custody.

RISKS AND COMMON FAILURES

Common mistake	Why it is harmful	Control
Signing a clean POD before photos	May evidence apparently sound and complete delivery.	Train receiving staff to make a precise reservation before vehicle departure.
Moving or cleaning too soon	Destroys stow position, water source, impact point and custody trail.	Move only for safety/mitigation and document before, during and after.
Notifying only the forwarder	Notice may miss the contractual carrier or insurer channel.	Use a shipment-specific notification matrix and seek receipt confirmation.
Waiting for survey report before notice	Can miss notice deadlines even while cause is unknown.	Send preliminary notice immediately and quantify later.
Discarding cartons, pallets, seal or damaged goods	Removes evidence and inspection opportunity.	Apply an evidence hold until written disposal authority.
Selling salvage or repairing all cargo unilaterally	Changes the loss amount and recovery position.	Obtain written guidance, quotations and salvage records.
Treating Incoterms as the liability rule	Incoterms allocates sale risk, not carrier or insurer liability.	Run seller, carrier, service-provider and insurance tracks separately.
Using one deadline for every mode	Sea, air, road, warehouse and insurance claims have different notices/time bars.	Create a deadline register from each controlling document and act to the shortest preliminary deadline.

LEGAL FRAMEWORK AND REFERENCE SOURCES

Official/authoritative source	Use	Application note
IMO/ILO/UNECE CTU Code	Practice framework for receiving, opening and handling cargo transport units.	Non-mandatory code used together with SOP, contract and law.
CTU Code – Reception of CTUs	Checks for CTU identification, seals, tampering and discrepancy records.	Especially relevant to FCL and road container custody.
CTU Code – Unpacking a CTU	Documents and notifies cargo damage during unloading and addresses leaking dangerous goods.	Safety and SDS controls override evidence preservation.
ICC Incoterms® 2020	Allocates seller–buyer obligations, costs and risk transfer.	Does not itself determine carrier liability, title or actual insurance cover.
IATA Cargo Claims & Loss Prevention Handbook 2026	Air-cargo claims and loss-prevention reference.	Check the AWB, MC99/Warsaw regime and airline conditions.
ICAO – Air Cargo and Montreal Convention 1999	Unified liability framework for international air cargo where applicable.	Check treaty parties, routing and applicable instrument.
Vietnam Maritime Code 2015	Vietnamese framework for sea carriage and carrier responsibility.	Rights, limits and time bars depend on the transport document and applicable law/convention.
Consolidated Insurance Business Law 31/VBHN-VPQH (2026)	Vietnamese legal framework for insurance contracts and claims.	The policy, certificate, clauses and endorsements control the specific cover.

CTU Code Incoterms® 2020

FREQUENTLY ASKED QUESTIONS

Should the whole shipment be rejected when only a few packages are dented?

Not automatically. Reserve the condition, segregate suspect cargo and follow the contract/SOP. An unjustified rejection may create storage costs or conflict with mitigation duties.

Can a shortage claim be made when the seal is intact?

Yes, if tally and records support it. An intact seal is only one fact; review packing records, weights, CCTV, manifest and devanning evidence.

Should wet cartons be retained?

Retain packaging, pallets, dunnage and relevant samples to a reasonable extent until the surveyor, insurer or carrier has had an opportunity to inspect or approve disposal.

May cargo be repaired or sold at a discount before the insurer responds?

Only when reasonably necessary to mitigate or under written guidance. Preserve evidence, quotations, costs and salvage value.

Should the carrier or insurer be claimed against first?

Notices and dossiers may proceed in parallel. The insurer may require preservation of recovery rights, and total recovery must not exceed actual loss.

What is the deadline for reporting cargo damage?

There is no universal deadline. Check the B/L or AWB, carrier terms, warehouse/logistics contract, policy and applicable law/convention, and send preliminary notice immediately.

Who should own the claim internally?

Use one claim owner for deadlines and dossier control, supported by warehouse, logistics, procurement, QA, finance, legal and insurer/broker teams.

APPLICATION NOTE: Liability and recoverable amount depend on causation, risk-transfer point, sale contract, transport document, service terms, insurance policy, packing, handover evidence and applicable law/convention. This article is an operational loss-management framework, not legal advice or a promise of recovery for a particular shipment.

TGIMEX IMPLEMENTATION SUPPORT

TGIMEX helps businesses turn the article into a shipment-ready checklist, covering input-data review, dossier preparation, milestone control, and coordination with the relevant parties.

Convert guidance into checks

Assign an owner and deadline to every operational control point.

Reconcile shipment data

Compare booking, transport, commercial, customs, and delivery evidence.

Manage operational risk

Record discrepancies, actions, and decision evidence to prevent recurrence.

Discuss your shipment dossier

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