Letter of Credit requires IMO Number to be shown on Bill of Lading
A case study on the obligations of a shipping line in terms of clauses/notations to be mentioned in a bill of lading.. Based on a real life question from a reader..
letter of credit
Do banks verify whether the cargo has actually been loaded on a ship..??
Shippers who deal with documentary credit know that the clause “Shipped on Board” on the bill of lading carries quite a bit of weight and there is often a lot of discussions, disputes and rejections from the side of the bank if there is any discrepancy in bill of lading in terms of the description of goods, customer details, shipped on board date, stamp or signature..
Since they are being so strict with documentation, one would naturally assume that the banks will verify whether the cargo covered in the bill of lading has actually been loaded on board the ship or not..
First cross-bank blockchain based letter of credit transaction completed
Standard Chartered announced the successful completion of the first cross-bank Letter of Credit (LC) transaction between Vietnam and Thailand conducted over blockchain, in partnership with Asian Development Bank (ADB), Bank for Investment and Development of Vietnam and Standard Chartered Bank (Thai).
What is a letter of credit, how it works and who needs it..
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..
India’s first blockchain enabled Letter of Credit transaction completed
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..
Should the Shipped on Board Date and Bill of Lading Date be the same..??
Shipped on Board Date and Bill of Lading date – can these two dates be different..
What are the implications if they are same or different..??
Shipped on Board Date stamp – should it be signed..??
A shipped on board date is an important date on a bill of lading, especially where a Letter of Credit is involved..
Should the Shipped on Board stamp be signed and the implications whether it is signed or not..
Letter of Credit and Trade Finance timelines
A reader asked me a question about letter of credit and trade finance timelines..
With a letter of credit. What sort of timings are usually connected to when the payment between banks occurs? Does the shipment sail prior to the LC being satisfied?
This is actually is a very good question – and the answer usually is: “it depends..” Kim Sindberg provides below comprehensive response on what it actually depends on and the relevant rules applicable..
Part Bill of Lading to the rescue..
When answering my last post Question regarding cargo under Letter of Credit, I mentioned that part bills could be a solution for two shipments in a same container where part of the cargo is covered by L/C and the other part is not..
However, there are several criteria/requirement in order for the carrier to be able to issue Part Bills of Lading and for the customer to accept Part Bills of Lading for this particular scenario..
We will examine these criteria/requirements in this post..
UPDATE to – Question regarding cargo under Letter of Credit
In my last post, I posed a question on behalf of a reader about the possibility of two cargoes being shipped under one bill of lading where one cargo is covered under Letter of Credit and other cargo is not..
Should the carrier issue two bills of lading..?? Or is mentioning in the same B/L the goods under L/C and goods that aren’t is enough..??
This post is an update where I have discussed the answer to the above question..
Question about multiple cargoes in a container where only a part of the cargo is covered by letter of credit
What happens if the exporter would like to send in the same container goods covered by L/C in addition to some other goods.
Should the carrier issue two bills of lading..?? Or is mentioning in the same B/L the goods under L/C and goods that aren’t is enough..??
What is a short form/blank back bill of lading..??
True to the nature of its business, the business of shipping and freight is a vast ocean covering many issues and areas which sometimes seems unfathomable..
A Bill of Lading is the most important document in this business and there are always several questions surrounding a bill of lading.. This article deals with one such type of bill of lading – Short form bill of lading..
Shipping cargo without insurance – reader question
Shipping your cargo without insurance.. Hmmmmm, not a very smart idea.. Several pitfalls await those who attempt this.. Here’s a question from a reader based on their historical experience.. All comments welcome on this situation..
Can I get an Express Release for cargo while Original Bill of Lading is with the bank..??
An exporter wants to get an Express Release done while the Original Bill of Lading is with the bank..
Is this possible..?? Read this article to find out..
Story of a CIF contract and a Letter of Indemnity
This is the Story of a CIF contract and a Letter of Indemnity..
Seller is delivering CIF to Chinese port. The contract has an LOI provision if the original bill of lading should be lost..
The buyer’s bank refuses to make payment without original BOL and will not accept LOI..
What happens next..??