UPS Third-Party Account Declines Responsibility for Shipping Charges

UPS Third-Party Account Declines Responsibility for Shipping Charges


UPS third-party accounts may decline to cover shipping charges when the waybill does not meet the billing authorization requirements or risk control policies of the third-party account holder. In such cases, UPS will reassign the charges to the actual shipper’s account.

Most Common Causes (Ordered by Probability)

1. Third-party account did not authorize this shipment (most common).

To use a UPS third-party account, the following must be explicitly authorized by the account holder:

  • Shipper identity

  • Origin country and shipping address

  • Approved service types

Common Reasons for Third-Party Billing Rejection

UPS may reject third-party billing if:

  • The shipping address does not match the third-party account’s registered address

  • The origin country or state falls outside the authorized scope

  • A valid third-party billing agreement has not been established

👉 In these cases, UPS will automatically decline third-party billing and reassign the charges to the shipper’s account.


2. Cross-Border Third-Party Billing Restrictions

Cross-border third-party billing is subject to strict limitations.

For many UPS accounts:

  • Only domestic third-party billing is permitted

  • The following scenarios are typically not allowed:

    • Shipments from China (CN) to the United States (US)

    • Non-U.S. origin shipments billed to a U.S.-based third-party account

In such cases, UPS will classify the transaction as:

“Third-Party Billing Not Allowed for This Shipping Lane.”

As a result, the third-party billing request will be rejected, and the charges may be reassigned to the shipper.

3. Third-Party Account Credit or Risk Control Issues

Third-party billing may be rejected due to account credit or risk control concerns, including but not limited to:
  • The account has reached its credit limit

  • Outstanding or overdue invoices exist

  • Third-party billing has been temporarily restricted by UPS Risk Management

👉 In such situations, UPS may decline third-party billing and reassign the charges to the shipper to mitigate financial risk.


4. Waybill Information Is Incomplete or Non-Compliant

Third-party billing may be rejected if the waybill details are incomplete or inconsistent with UPS records.

Common issues include:

  • Incomplete third-party address information (e.g., missing ZIP/postal code or country)

  • Third-party billing country does not match the account’s registered country

  • Billing address does not match the information on file in the UPS system

UPS operates under a highly controlled billing validation system. Even minor discrepancies may result in automatic rejection of third-party billing.


5. Service Type Does Not Support Third-Party Billing

Certain UPS services do not allow third-party billing.

Examples may include:

  • Specific UPS Ground or SurePost services

  • Certain special services or contract-based pricing agreements

👉 Even if the third-party account is valid, the selected service may not support third-party settlement.


6. Third-Party Account Disputes or Rejects the Charge

In some cases, the third-party account holder may explicitly dispute the charge.

This may occur when the account holder:

  • Files a billing dispute with UPS

  • Declares the shipment as unauthorized

When this happens, UPS may:

Reverse the charge and reassign it to the shipper’s account.


Why Are Charges Reassigned to the Shipper?

UPS follows a fallback billing hierarchy to ensure that completed shipments are paid for.
As long as the shipment is successfully delivered, UPS must assign the charges to a responsible party.

The typical billing priority is:

  1. Third Party

  2. Receiver

  3. Shipper (final fallback) ✅

If third-party billing fails at any stage, the system will automatically revert the charges to the shipper’s account.

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