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Who claims when a Foreign Military Sales shipment is lost or damaged?

Updated 27 September 2026Checked against the SAMM: 26 September 2026

It depends on who arranged the transportation. Title passes to the purchaser at the point of origin, and the U.S. Government bears no loss in transit. Where the purchaser or its hired or paid the carrier, they claim against it directly. Where the Department of War furnished or contracted the transportation, it files the claim, and any proceeds go to the purchaser's account at . Either way the carrier's liability is limited, so insurance is the purchaser's protection for the rest.

Decision tree: who claims when a Foreign Military Sales shipment is lost or damaged in transit depends on who arranged the carrier for that leg. Where the purchaser or its freight forwarder arranged it (collect, third-party billing, Delivery Term Code 4, or a carrier the forwarder hired), the purchaser or forwarder claims directly against the carrier; the U.S. Government cannot submit that claim. Where the Department of War furnished or contracted a commercial carrier in the Defense Transportation System, the Security Cooperation Organization reports the loss on a Transportation Discrepancy Report, which the purchaser cannot submit, and the Department of War claims against the carrier; the Implementing Agency forwards any proceeds to the purchaser's account at DFAS-IN. On military airlift or sealift there is no carrier to claim against and no proceeds. Whichever branch, the most the purchaser can collect from a carrier is its limited liability; beyond that the purchaser self-insures or buys commercial insurance. Damage before release to the carrier, or no evidence of shipment, is a supply discrepancy and goes on a Supply Discrepancy Report instead. WHO ARRANGED THE CARRIER DECIDES WHO CLAIMS fmsedge.com A shipment was lost or damaged in transit Who arranged the carrier for the leg where it happened? Before release to the carrier? Supply Discrepancy Report instead damage at the shipper, or no evidence of shipment the purchaser or its forwarder DoW, commercial carrier DoW, military lift Purchaser or freight forwarder collect, third-party billing, DTC 4, forwarder-hired Defense Transportation System DoW-furnished or contracted commercial carrier Military airlift or sealift AMC channel, SAAM, Military Sealift Command Who claims The purchaser or its freight forwarder claims directly against the carrier. On a collect or third-party-billed inland leg the forwarder claims on the purchaser's behalf. Claim money The U.S. Government cannot submit this claim for the purchaser. Who claims DoW claims: ARTRANS against ocean carriers, AMC against air carriers, shipping activities against inland CONUS carriers. The SCO files the TDR (DD Form 361); the purchaser cannot. Claim money Any proceeds: forwarded by the Implementing Agency to the purchaser's account at DFAS-IN. Who claims No one: there is no carrier to claim against. The SCO still reports the loss on a TDR. Claim money No carrier claim, so no proceeds. DoW is not responsible for loss or damage in transit. proceeds Beyond the carrier, whichever branch The most the purchaser might collect for loss or damage is the carrier's limited liability. Beyond it the purchaser self-insures or buys commercial insurance; the TDR record may help that insurance claim. SCO = Security Cooperation Organization. TDR = Transportation Discrepancy Report. ARTRANS = U.S. Army Transportation Command. AMC = Air Mobility Command. SAAM = Special Assignment Airlift Mission. CONUS = continental United States. DFAS-IN = Defense Finance and Accounting Service, Indianapolis. FMS Edge who handles it · claim money · a different report applies fmsedge.com · Current as of 12 September 2026 · SAMM C7.21 · C7.10.1 · C6.4.10.3 · DTR Part II ch. 210

Who claims for a lost or damaged shipment depends on who arranged the carrier for that leg. On legs the purchaser or its freight forwarder arranged, they claim directly against the carrier. On Defense Transportation System legs the Department of War claims, and the Implementing Agency forwards any proceeds to the purchaser's account at DFAS-IN. On military airlift or sealift there is no carrier claim. Beyond the carrier's limited liability, the purchaser's protection is its own insurance.

Lost or damaged in transit: who claims · Current as of 12 September 2026 · SAMM C7.21 · C7.10.1 · C6.4.10.3 · DTR Part II ch. 210 · Download PNG

Who claims when a Foreign Military Sales shipment is lost or damaged?

Very few freight forwarders are permitted to open containers to check for possible damage of the contents. Claims must be filed against commercial carriers for shortages and visible damages. Because title to the materiel transfers to the customer at the initial point of shipment, the should generally not refuse a shipment that is destined for the customer. The DoW shipper has no authority to take the materiel back, because the title is warranted to the purchaser in the . The should accept damaged articles and resolve discrepancies with the shipper.

When using the , the generally maintains control and custody of the materiel (but not the title) until delivery to the purchaser. Since use of an -funded bill of lading for an shipment is considered a shipment, the DoW is performing a reimbursable service for the customer, and custody must not be construed to mean retention of title or acceptance by the DoW of any risk of loss or damage. If the ships an item to an recipient, including a recipient , and loss or damage occurs, the recipient must notify the shipper. The shipper may choose to file a claim with the carrier. The customer may not file claims directly against the carrier. The has responsibility for filing and processing claims with carriers when the shipment is made on a prepaid basis to locations where DoW personnel or other representatives have primary responsibility for receipt inspection and acceptance.

References

Drawn exclusively from publicly available authorities.

SAMM

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Related

GuideWhat is a Transportation Discrepancy Report?GuideShould a Foreign Military Sales purchaser use a freight forwarder or the Defense Transportation System?GuideWhat is a Delivery Term Code?GuideWho is responsible for shipping in a Foreign Military Sale?GuideWhat are accessorial charges in Foreign Military Sales?GuideHow does a purchaser pay for transportation in a Foreign Military Sale?GuideWho bears the risk of loss in a Foreign Military Sale?GuideWhat is a Supply Discrepancy Report?