Documentation

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..

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..

Cargo insurance is a type of insurance that protects a buyer or seller of goods against damages or loss of cargo..

Despite insurance having been around for centuries, there is still a feeling that any form of insurance is a “grudge purchase” and in the case of cargo shipments, many people ask the question "Do I need cargo insurance for my shipment"..??

"How do I know the bill of lading issued is a House Bill of Lading or a Master Bill of Lading..?? Is it mentioned anywhere on the bill of lading that it is a House Bill or a Master Bill"

I really love such basic but curious questions because it rejuvenates the gray matter.. Let's explore this question..

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).

Misdeclaration of container weights has been an issue that has been going on for a long time and has plagued many a shipping line, ship and port operators..

In a recent article, I wrote about the basics of container stowage planning and why it is so important..

In this article, I thought it would be worth reiterating the importance of being accurate in the declaration of the weights..

Over the years, I have received several questions from readers relating to a variety of topics on this resource..

Some of them are really valid questions especially if you consider that some of these questions may be from someone importing for the first time or someone exporting for the first time..

It makes you think of the issues that those entering international trade for the first time or shipping their first container would be facing in getting it completed successfully..

The business of shipping, freight and trade could all be a bit overwhelming as there are several processes to be followed and for those who are doing it for the first time, asking questions and finding the right answers is extremely important..

Here are some questions which I received from one of the readers of this resource, possibly, someone who is starting out new or someone experiencing some new problems with their shipments..

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..

If you are in the business of international trade you would have no doubt heard about a Certificate of Origin.. But not everyone is familiar with what is a certificate of origin, why it is required, who issues it etc.. This article aims to clarify these points..

A Trade agreement is a contractual arrangement between countries concerning their trade relationships and how they conduct trade with each other..

Customs department in the importing country may require a “proof of origin” in order to determine whether or not the cargo that is imported may be subjected to trade measures such as the preferential duty tariff (for stuff that is imported from with the PTA bloc), free trade deals, prohibited goods etc..

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..

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..

Household Relocation........................ a stressful item for many people but sometimes inevitable.

Moving internationally is not an easy thing to do and you have to try and stay well-informed about many things. It could be a tedious process both on the pocket and the mind. You may face several stressful moments.

Avoiding cargo damage, safeguarding yourselves against fraudulent freight forwarders, gathering the correct documentation for household relocation and also ensuring that your goods reach your new destination in time and in good condition.

You may also be faced with endless paperwork, customs and port documentation as well as many other forms of documentation for the move.

The paperwork and documents that you and your family need might take months to gather if you don't know which ones you need at the very beginning. If just one is missing, it could be a big problem for you. And when moving internationally, you don't want to have any problems at all - or you want to at least keep them as minimal as possible.

Here are some tips about documentation that you need for international household relocation.

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..

Blockchain seems to have become a prolific "enabler" of businesses, particularly in the shipping and freight and trade industry..

Whether in its use by Banks and Shippers to create Trade Finance documents; or creating and transmitting smart bills of lading; or setting up a blockchain-based marketplace app for trading in coffee; or making documentation easy for ports; or ensuring prompt delivery of mandarins for the Chinese New Year; Blockchain is making its presence felt quite rapidly in our industry..

Many shipping lines, ports, financial institutions and other private entities are using Blockchain and testing it in many different ways through many pilot projects..

Saudi Customs became the latest entity to successfully test drive its first shipment powered the blockchain technology..

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..

The world of shipping and freight is very dynamic and there may be several changes that happen during the course of a shipment or post shipment..

Destinations can change, cargo routing can change, cargo release parties can change, even important documents such as a Bill of Lading may be subjected to changes..

Some may be simple amendments, but in a lot of cases, the changes or requirements may be elaborate such that it necessitates the issuance of a Switch Bill of Lading..

Read here about what it means and when and where it is used..