Shipper on bill of lading can be from a country different from port of loading – Yes or No
Food for thought..?? Previously, I wrote an article “Can the shipper’s address on the bill of lading be in another country“..
At that time there were a few comments confirming that this was possible and this tied in with my experience as well..
However, in the recent past (as recent as last week) I have had communications whereby it has become clear that not all countries allow this to be done..
For example, in India and Brazil, as per customs requirement (confirmed by a few forwarders to me), the shipper on the bill of lading has to be the actual exporter of the cargo who has filed the customs documentation and has to be based in the country of the port of load..
This would then mean that there is no difference between an exporter and a shipper as far as India or Brazil is concerned, as the shipper on the bill of lading has to be the actual exporter..
So that got me thinking as to how many other countries are there that have the same requirement..??
Please do comment below and also participate in a quick short poll and let us find out where the majority lies..
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If seller is differnt from shipper country ,who is issue certficate of origin or by whom is name issue certticate of origin?
Dear Alfred,
I am a trader doing international trade based in Dubai. From Jan 2018 UAE has implemented VAT and since than things have become complicated especially for 3rd port shipments. Our company has exports to Africa and most of the funds from our customers are not sent thru bank transfer but from other channels via agents. Can you advise me on implications and solutions which can arise in VAT economies in doing such cross trade.
Regards,
Khan
I am an international trader since 2003 I buy and sell in all the world, and I am also a consult for import export, and I do this every time to hide my supplier contact. now a days we are living in a small world, everything is expose through internet and it’s very easy to reach suppliers once you have name or contact, so for preventing other party to know your sources, I put my company name as a shipper, by that I solve the problem of exposing my supplier contacts.
Every country has it’s own policy with regards to Shipping line instructions. As far as I am concern, the shipper is supposed to be in the same country of loading on the Master bill of lading (Carrier MBL). If one has to consign shipper details of another country (Which we refers to as cross booking) on the bill of lading he may do so on the house bill of lading (Forwarders BL). Ghana for instance, carrier depends on the customs declaration to issue MBL and it is only registered companies in Ghana who have the tax identification number can be found on the custom systems.
Dear All,
As we all are depending upon more and more international business practices, it is not possible that all goods should be sold from the same country of origin. In international business a term “Third Country Trade ” has been given to such transactions. Further, at the time of loading and sailing of the vessel bill has been issued in the name of Actual exporter only but thereafter the BLs are switched after surrendering the original BLs to the vessel agent and name of the shipper and consignee can be changed. Even in India, it is not necessary that the name of the actual exporter should be reflecting on the BL as shipper. I don’t know how the opinion of non acceptance by custom has been made.
I export to many traders outside of my country South Africa on FOB basis and they get BLs issued indicating them as the shipper. They do this to avoid direct contact between the end user and us the supplier. Some of the traders prefer to be indicated as the consignee and then they switch the BL in their country.
this is impossible to have a shipper from a country different from port of loading, but can anyone discuss if the shipper has less demand according to the order cycle from the importer, just in case. And if the shipper has another branch from other country which they can afford the order cycle at that time. Can the bill of lading issue from one country or it shall be issue from both countries?
You need to discuss the matter with your buyer. Yes in one single BL name of your Company other than the exporting country can appear by switching the BLs
An exporter could be in China while it exports from it’s manufacturing plant of Vietnam.
My country is open for investors, so investors in my country are not prevented from exporting, if you are licensed. So i think bill of lading should not be restricted to Indigenous members only
Its allowed to mention or issue BL with shipper from another country than the country where the container actually get loas
not compulsory because shipper may have register a subsidiaries from different countries where himself is in another country. it is possible for that article according to my point of view
Both Shipper and Exporter SHOULD be from the country where the cargo is departing. This is the proper way. This is for liability purposes. What recourse do you have from a foreign country? None.
Although forwarders can file as a routed transaction, it is best that the Shipper / Exporter be the entity to control what invoice values are reported to US Customs.
Great read, I’ve always been very interested in Dangerous Goods Segregation Table
Invoice can be raised from any country. Supplier and manufacturer need not be same. if customs have any doubt about value, they may ask for the manufacturers invoice.
Hi Asha, In my experience, most overprotective legislations do not accept invoice from a country different than the country of origin. This is a real problem for us as Traders.
But you may have problem if your goods is reqùired C/O at destination country .
Where can you get C/O from? The first shipper country or the second shipper country? If from the first country, then the real consignee will know the original country of export, but if from thr second country which declares in Switch B/L , then this may not have this kind of product for export or even don’t have factory to produce that ministry of commerce will issue C/O for the second shipper.
Hi Tith, Again, a basic principle of international trade is that the means of transport does not alter the origin. The country in which the goods are produced is the country of origin; in case of fishing the flag-state of the fishing vessel is the country of origin. A transit country (i.e. shipper country) is just a point in the transport route to market. Changing from one means of transport to another or from one conveyance to another does not alter the essence of the merchandise itself and, therefore, does not entitle that merchandise to have a new country of origin. In the case of fish, for example, the catch of a Taiwan-flagged fishing vessel that is unloaded in Cape Town, South Africa, stuffed into reefer containers alongside the dock and shipped to country C for processing will have a C/O issued by Taiwan authorities.
Hi Carlos,
Thanks for your explanation, that is true for fishing at high sea and doing export via the nearest port where the fishing boat located by issuing C/O from the fishing boat’s country as the fishing boat is the real shipper who export from their country but via the nearest port ( foreigner port ) which his boat located rather than to sail back to his country to export the goods via the port located at his home country. This is business facilitation. But for some goods, especially agriculture product, we may have to issue C/O from the real shipper ‘s country because the ministry of commerce will ask for the company patent or company VAT # before they issue C/O for you. So if you change the shipper in the Switch B/L, then the shipper appear in the B/L and in the C/O doesn’t match each other then customs will not accept when you clear your goods at importer’s country. But if your goods is used machinery or any goods that your buyer don’t require you to have issue C/O, may be we can change shipper in the Switch B/L at transit port by submitting the original set of B/L back to the shipping after surrendered from the original shipper to the first consignee ( transaction is completed and closed while the goods is still on the sea between shipper and you ), Then you will become the shipper, starts from the transit port ‘s country to the third party ( you buyer as consignee ) which you have sold your goods on the sea to your buyer at another country. To do this way, how do you think?
It is possible. We are traders in a specific commodity which we may purchase in country A, sell to country B and finance in country C. As such, as Mr. Forest indicates, we use the “OBO” figure commonly. Not allowing such flexibility is typical of overprotective countries such as Brazil and India, in which doing business is not as efficient as with other more trade-oriented jurisdictions. Also, typical of these overprotective legislations is to insert ‘strange’ requirements into the BL such as invoice number, certificate of origin number, packing list number, to name a few. Introducing such requirements into the BL distracts from the purpose for which it is intended. This is the perfect breeding ground for corruption.
Carlos A RODRIGUEZ is right, in international trade Sply in third country trade where the supplier is in different country than the country of Origin of goods. The Original Certificate issued from the country of origin is used at the time of clearance in the importing country.
In case of Switch BL, plus if switching has to be done at origin only than we have to issue to the switch with Consignee of first BL as exporter… So yes, we can issue it in case of Switch BL… Correct me if i’m wrong!
Although the “No” answer may seem more closely aligned with what “should” be, local regulations (the “Yes” in this case) constitute a reality in global trade and must be dealt with accordingly.
Very interesting question as I am a shipper in Dubai but shipping from 18 different sources in the world including Brazil and India.
I use this a lot and when facing issues we find a workaround using the exporter name “on behalf of” the shipper name
So I am very interested in the answers
thank you for your blog
NO IT IS NOT COMPULSORY
Bill of Lading is the document of contract so it can be any body, but for customs declaration this should be
in a seperated document.
Because you have to registered you company in the ministry of commerce and in the order hand you have to issue C/O for your buyer to gain their GSP from the imported country for some certain goods to be exported.
TITH, this is what overprotective countries end up doing: confusing the purpose of specific documents. A basic principle of international trade is that the means of transport does not alter the origin. This is very important for trade under GSP regulations. For example, the catch of a French-flagged fishing vessel discharged in Senegal and shipped to country X for processing. If country X regulations require specific data in the BL to demonstrate origin, then they are confusing the purpose of the BL (which is the receipt for the cargo and evidence of the existence of a contract of carrige but that another article already discussed here). The proof of origin comes from another document –not from the stated ‘place of receipt’ or ‘port of loading’ or ‘shipper’ on the BL.
I mean , when we have an intention to change the destination of port of discharging to avoid shipper to know our real buyer or we don’t want our buyer to know our supplier. So we will apply for Switch B/L when ship is still on the sea. The only shipper who book the ship space is authorized to apply the shipping line for Switch B/L by returning all OBL to shipping company or whether consignee can also apply for Switch B/L instead of shipper? If only shipper is authorized, it that shipper will know the real buyer or our real customer in the third country. So shipper may steal our customer in future.
But if consignee have right to apply Switch B/L by changing the shipper Name from the first supplier to our own company as the shipper who has exported this shipment from our country instead, then if the goods is RICE from Cambodia to E.U, we have to get the C/O for our buyer to get the import tax exemption because we have gained GSP from E.U. This case, the ministry of commerce will ask, from which rice mill have you bought ? If we say , we bought it from another country, they will issue C/O for you. If our real customer in E.U don’t get the C/O from Cambodia, they will not get import tax exemption. How do you think ?
For those wondering, the fish remains of French origin regardless of the intermediate stops. Once it is processed –sufficiently transformed– other rules apply to determine the originating country and the GSP benefits applicable.
Question relating ? Can an exporting company from another country export out from another country??? Penn
Hello Heriesh, can I consider the EU as one country in case of your question? Thanks, Dia
Very interesting article.
I’m a Loss Adjuster in Brazil and according to local customs law, the shipper in the Bill of Lading must be based on Brazilian territory. But I know that is not so in all countries. By the way, I am currently dealing with a case of a claim that the factory of the damaged equipment is in China, where it was shipped, however, the shipper appearing in the BL is the headquarter of the company, which is in France. As you see, the reality may not be the same in all countries.
Great article as always
Good day, imagine shipper is not from same country as port of loading, and moreover, freightforwarder @pol is not on the bl, except on notify @ destination (or its agent). the cargo is discharged at port of discharge but the consignee is unreachable, and the cargo stay @ destination during several weeks there (so imagine SURESTARIES, STORAGE fees etc)
the shipping company try to make pay these fees to shipper, but it is unreachable too (we are going to think this company was created only for this shipment, but cease to exist). shippng company try to recover money from freightforwarder, but freightforwarder was not on the bl and was not tied to contract of transport. do you think shipping company can recover money?
what did you do if the freightfowarder who books for a shipment, is not on the BL? is it secured? do you insist to him to be on the bl by mentioning any term like for account, on behal of and so on? what are the risks?
In the shipping, many times the practice is diferent of the law! In Portugal, the shipper can be not the exporter, for example in the groupage cargo/containers, where the shipper is, normally, the forward agent, that issues the house B/L for the exporters, their clients and the thrue exporters. Monteiro da Rocha