As everyone probably knows by now, a bill of lading is one of the most important commercial documents in the business of trade and shipping..
If you don’t know, I would suggest you read up on what is a bill of lading and its functions and why it is important..
One of the most important information in a bill of lading is the shipped on board date.. What is this date..??
Shipped on board = Confirmation from the entity issuing the bill of lading that the cargo has been loaded on board and the ship has sailed..
When issued with a shipped on board date, it indicates that the cargo described on the bill of lading has been loaded on board the ship and the ship has sailed on the date mentioned..
If no date is mentioned, the bill of lading date will be deemed to be the date of shipment..
This could be different from Laden on Board..
Laden on board = Confirmation from the entity issuing the bill of lading that the cargo has been loaded on board..
When issued with a laden on board date, it means that the cargo described on the bill of lading has been loaded on board the ship on the date mentioned..
If no date is mentioned, the bill of lading date will be deemed to be the date that the cargo was loaded on board..
Laden on board only means that the cargo has been loaded on board and should not be construed as the ship having sailed with the cargo..
This specific notation however is not very widely used as compared to a shipped on board notation..
Ok, so what is pre-dating or back-dating..??
Pre-Dating or Back Dating is when the shipper requests the shipping line to show the Shipped on Board date on the bill of lading as a date before the actual sailing of the vessel.. For example : the vessel actually sails on the 2nd of March but shipper wants the line to show the shipped on board date on the bill of lading as 28th of February..
Why would a shipper want his bill of lading to be pre-dated or back dated..??
This request is generally made to the shipping line when :
- There is a Letter of Credit involved and the L/C stipulates the last date by which the shipment must be effected, means the shipment should have sailed on or before that date ;
- The last date of shipment may be stipulated on the L/C for various reasons by the receiver including the fact that they want the cargo to reach them by a certain period and they have calculated their arrival date based on the intended date of departure of the container from the port of load and the transit time ;
- If for some reason, the shipper is not able to carry out the shipment within the stipulated time, he stands to lose his order and could be subjected to penalties and default ;
- When the party (generally the receiver of the cargo) that opened the L/C rejects the shipper’s request for an extension to the letter of credit
In this case, since the shipper cannot afford to miss the deadline, he requests the shipping line for the bill of lading be pre-dated..
Implications for the shipping line due to back dating
If this pre-dating or back dating is done, then the bill of lading will show the shipped on board date in accordance with the L/C deadline as required by the shipper, although the cargo was actually loaded and the ship sailed AFTER the deadline..
This constitutes fraud and willful misrepresentation of the facts to the receiver who is under the impression that the shipment has been effected within the stipulated time frame..
Remember the consignee has a written confirmation (bill of lading) from the shipping line that shows the date of shipment..
Also remember, that the banks which are party to the letter of credit do not verify whether the goods were actually shipped as per the requirements of the L/C.. They only check whether the documentary information matches the requirements of the L/C..
Under normal circumstances, shipping lines will not back date a bill of lading (even if there is a Letter of Indemnity from the shipper) as they do not want to be part of this fraudulent activity..
Moreover, the practice of actioning requests based on LOIs for activities such as below are viewed by most P&I clubs as a form of documentary fraud and a fundamental breach of P&I Club cover and underwriters will not entertain any claim, costs or damages arising out of this fraudulent activity, should the defrauded receiver place a claim against the shipping line..
They might give you a Received for Shipment bill of lading but that too only provided that the containers/cargo has been delivered to the possession of the shipping line on or before the date that is required to be shown on the bill of lading..
So, now you know why shipping lines may refuse to pre-date or back date your bill of lading..
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