Bill of Lading

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..

By definition, "A Delivery Order is a release document issued by the carrier releasing the cargo to the consignee mentioned in the bill of...

An article on how to safeguard cargo release using the correct type of bill of lading.. This article is based on a case study information received from one of the readers..

Executive Insights is a series by Shipping and Freight Resource that provides insights and thoughtful analysis about the industry..

This series features selected individuals from the industry and is aimed at enriching the knowledge of the readers with what is happening in the shipping, freight, maritime, logistics, and supply chain industry..

Executive Insights also gives you a chance to pick the brains of these industry veterans, leaders, and enablers..

In this edition of Executive Insights, we caught up with Philip Teoh - Lawyer and Maritime Arbitrator, on aspects of International Convention of Carriages and other maritime matters..

Maybe because it is one of the most important documents in global trade, there always seems to be a degree of uncertainty around a bill of lading and questions such as this..

Many people have doubts regarding which bill of lading to issue, how many to issue..

There are also questions such as what is a Telex Release, how it works and under what circumstances a Telex Release maybe issued..

In this particular post, I will cover the circumstances under which a Telex Release maybe issued and whether a telex release can be actioned on a negotiable bill of lading..

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 (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 and why would a shipping line reject this request..??

Many of you might have heard the term Letter of Indemnity (LOI) in day to day shipping practice..

There have been several arguments, discussions, commercial threats, litigation etc surrounding this LOI..

But many still have doubts on what an LOI is, when it can and should be used, whether it is legally enforceable and whether it is worth the paper it is written on..

I will try to answer these questions in this article..

Many a time, shippers have asked shipping lines for "CLEAN ON BOARD" clause on a bill of lading and if the request relates to a container shipment, this might have very well been rejected by the shipping line..

Why do the shipping lines reject this..?? 

This definition of the term "Merchant" has caught the attention of the Federal Maritime Commission (FMC) who is soliciting public comment as to

1. How VOCCs apply the term “Merchant” in their bills of lading;
2. Whether the definition, as applied, subjects third parties who are not in contractual privity with the carrier to joint or several liability; and
3. Whether carriers have enforced the definition of merchant against third parties that have not consented to be bound by, or otherwise accept, the terms and conditions of the bill of lading.

I have shared my personal opinion on this.. Have a read and share yours..

The Electronic version of the most powerful document in shipping - the Bill of Lading has been making news for quite a while..

I wrote earlier that 2020 will be remembered as 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..

Carriers are pushing more and more for the adoption of the eBL in various regions of the world with the aim to improve documentation flow and avoid costly delays to customers..

MSC has just released a statement confirming that they will be accelerating the adoption of their eBL with the WAVE platform in India..

A Bill of Lading is one of the most important documents in the shipping cycle and comes in different forms such as Negotiable or Order Bill of Lading, Seaway Bill of Lading or Express Bill of Lading and Straight Bill of Lading with further permutations and combinations such as Port to Port Bill of Lading, Combined Transport Bill of Lading or Multimodal Bill of Lading and Through Bill of Lading .. As most of you may know by now, a Bill of Lading has 3 basic purposes or roles..

1. Evidence of Contract of Carriage;
2. Receipt of Goods; and
3. Document of Title to the goods

In its role as Evidence of Contract of Carriage, the emphasis is on the term "Evidence" because contrary to popular belief, a Bill of Lading is neither

1. a contract between the Seller and the Buyer nor
2. a contract of carriage between the Carrier and Shipper

So if the bill of lading is the evidence of the contract of carriage, then what is the contract of carriage..?? This is the question in the minds of many in the industry and I will try to shed some light on this issue here..

Carrier refuses to show commercial and sales information relating to the cargo on the bill of lading.. Are they being pedantic or are they right..??

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..

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..

Here's something VERY INTERESTING for maritime historians, nostalgic seafarers, shipping documentation people and generally everyone interested in our wonderful industry.. Mr. Ahmet Aytoğan from Turkey is an avid collector of BILLS OF LADING.. Yes.. You heard right.. Bills of Lading (not sure if this hobby has a name yet like Philatelist etc......) He has been collecting bill of ladings for twenty three years now..............................

CargoX, the provider of the CargoX blockchain document transfer (BDT) platform, announced that they been granted prestigious approval by the International Group of P&I Clubs. The release says that CargoX It has become the first and only approved provider to use the neutral, public blockchain Ethereum network for its platform. The International Group of P&I Clubs (the IG) is an unincorporated association of the 13 principal underwriting Protection & Indemnity (P&I) Associations (Clubs) and their Affiliated Associations and Reinsured Entity. Between them, they provide liability cover (protection and indemnity) for approximately 90% of the world's ocean-going tonnage. Of the world’s top 25 reinsurers, 22 were featured on the group’s program in 2019.

Global trade has been around for centuries in various forms, starting from the Silk roads to the current Digital economy/age and has come a long way bringing alongwith it many changes and advances..

After the 3rd Industrial Revolution brought the Internet into play, there has been no turning back for globalisation with global exports accounting for almost 25% of global GDP..

Digitalisation, which was very much in its infancy a few decades ago has become the new frontier of globalization.. Advances like Blockchain, IoT, Big Data, Machine Learning and Artificial Intelligence have arrived in our industry as well and are here to stay, innovate and enhance global trade..

One of the digital advances that is catching on quite quick is an Electronic Bill of Lading..

Another one bites the dust.. By this I mean another company that is moving away from Paper Bill of Lading.. 🙂

It is inevitable that influential shippers and shipping lines are embracing tech one after the other.. Whether it is India’s first blockchain enabled Letter of Credit transaction, the first smart bill of lading issued using blockchain or the first blockchain based coffee exchange, technological innovations are here to stay in the shipping and freight industry..

G2 Ocean and Manuchar became the latest partnership to show that paper Bill of Lading is ready for retirement..  Together, they completed a successful pilot trial of CargoX’s blockchain-based Smart Bill of Lading Solution..

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..

The International Maritime Bureau (IMB) estimates from its work in verifying Bills of Lading that over 95% of all improperly issued Bills of Lading are issued by – yeah you guessed it – Non-Vessel Owning Common Carriers (NVOCCs)..

The IMB identifed that there is a prevalence of issuance of incorrect NVOCC bills of lading by the NVOCC which is then presented to banks and other stakeholders in the trading and finance chain, with the aim of defrauding the trade finance system, possibly for the purposes of multiple financing, money laundering, etc..

The IMB has developed a business solution to mitigate the effects of this problem..