The world of shipping involves several commercial, documentary, operational and financial processes..
While there have been many developments in the industry, a lot of the documentary processes in shipping and freight has stayed much the same for many decades..
Delays in document transmissions which could take anywhere between 5-10 days with the added risk of loss or delay of documents have severe consequences such as demurrage, detention and/or port storage, possible loss or cargo damage due to non-clearance and abandoned cargo..
CarogX Platform, a neutral, public blockchain-based platform is offering to provide a solution which will help to digitalize the trade documentation process using BDT (Blockchain Document Transfer) and reduce document transmission time to 20 seconds..!!
I took the platform for a test drive to see how it works and if it can assist the industry in saving costs and making the process of document transfer simpler, easier, economical and more importantly, secure and safer..
Many of you would have come across the term Letter of Credit (L/C)..
If you are a shipping line, you would have heard this term from various customers asking you to expedite the draft bill of lading for checking by the bank or for the release of the bill of lading to be expedited because the shipment is under L/C..
If you a freight forwarder or agent, you may have been put under pressure by the BCO to get all the documents required by the L/C sent to them in time..
If you are a BCO, you may have been told by your bank that the documents submitted do not match the requirements of the L/C and some of the documentation may need to be redone..
So what exactly is a Letter of Credit, what is the need for a letter of credit, who issues it and how does it work..
Many things have changed in the last 30 years in shipping and freight..
Many positive new developments have taken place with things from the vintage days of shipping either obsolete to almost obsolete now..
If you look at many of the news items about the industry recently, there has been a certain buzz and intensity around the electronic bill of lading..
I am fairly confident that people entering the shipping and freight industry in the next decade will be told that 2020 was the year that saw the beginning of the end for the paper “Bill of Lading” and the year in which the switch to “Electronic Bill of Lading” (eBL) began in earnest..
The pandemic that is COVID-19 is sweeping the world, disrupting global trade patterns like never before.. When one part of the globe is starting to settle down, the other part starts or spikes..
No one has any real idea of how long it will take for the world to get back to normal and its after effects..
Shipping lines, importers, exporters, ports, terminals, Governments, all businesses, insurance companies have all been affected by the pandemic and continue to look for ways to make the business of shipping as easy as possible considering the severe constraints everyone is going through..
This issue is also putting some of the documentary issues and cargo releases under pressure and leaving the industry to face the unknown.. One such issue that is affecting business is the transmission and handling of Original Bills of Lading..
There are a few options that customers can exercise to secure release of cargo without Original Bill of Lading..
A manifest is one of the key documents in the process of shipping..
A manifest lists all bills of lading issued for cargo loaded on a specific ship.. Kind of a summary if you wish..
A manifest lists the details of the cargo, the shipper, consignee, weight, measurement, packing.. There are different types of manifests:
Cargo Manifest – lists all information relating to the cargo excluding the freight charges..
Freight Manifest – lists all information relating to the cargo including the freight charges.. All charges as indicated in the manifest are either to be paid by the shipper or consignee..
Dangerous Cargo Manifest – a manifest that details the dangerous/hazardous cargoes on board the ship covering the Class, UN No., Description of Goods, EMS/MFAG etc..
Out of Gauge Manifest – a manifest that details the out of gauge (abnormal sized) cargoes on board the ship including the out of gauge details of the cargo.
Reefer Manifest – a manifest that details the reefer cargoes on board the ship including the temperature settings, humidity, which containers require monitoring on board – like cold treatment containers.
So what is a manifest correct and why is it required..??
This article explains what is a manifest corrector, its uses, where it can and cannot be used and how the process works..
Blockchain – that newfangled concept seems to be catching on quickly and moving along quite nicely in the shipping and freight industry..
A Blockchain is a ledger that uses cryptography, the internet and naturally computers to create, share, transfer, track and secure assets and transactions (represented/organised as blocks) belonging to everyone to fulfil a certain function..
Unless the previous transaction is not completed in the chain and shared forward with a timestamp, the next transaction cannot happen..
In the first transaction of its kind in India, HSBC India and ING Bank Brussels have enabled, successfully executed and completed a full blockchain driven trade finance transaction between India’s Reliance Industries and USA’s Tricon Energy..
Cargo covered by a bill of lading may only be released to the entity to whom it is consigned..
The shipping line and/or their agents at the destination must take cognisance of the type of bill of lading issued, the endorsements required on the bill of lading for the type of bill of lading before releasing the cargo..
Some lines are releasing cargo without the endorsement , some are strictly following above, some are content with releasing cargo to whoever is in possession of the bill of lading and are not seeking any endorsement or authorisation letter (in the case of release to an agent)..
What is your viewpoint on this issue and let us take a vote to see how strictly these endorsement requirements are followed..