"Poor Banker" versus "Smart Beneficiary" on "place of receipt different from port of loading"
[September
2007]
The UCP 500
included the following text in article 23,a,ii:
If the bill of lading indicates a place of
receipt or taking in charge different from the port of loading, the on board
notation must also include the port of loading stipulated in the Credit and the
name of the vessel on which the goods have been loaded, even if they have been
loaded on the vessel named in the bill of lading. This provision also applies
whenever loading on board the vessel is indicated by pre-printed wording on the
bill of lading
This wording was not carried through to UCP
600.
At the same
time ISBP (2007) dit not reflect paragraph 82 from ISBP (2003). Paragraph 82
had a direct link to the above lines from UCP 500.
Paragraph
82 from ISBP (2003) reads:
If a
Container Yard (CY) or Container Freight Station (CFS) is stated as the place
of receipt and that place is the same as the stated port of loading (e.g. Place
of Receipt: Hong Kong CY; Port of Loading: Hong Kong), these places are deemed
to be the same, and therefore the specification of the port of loading and the
name of the vessel in the "on board" notation are not necessary.
Many LC
experts and specialists had the impression that because of the removal of the
two above passages - the rule would not apply any more; i.e. that the
"extended" on board notation was not necessary.
There are
however many indicators pointing at the fact that notwithstanding these
omissions - nothing has been changed.
The best
example is Coastline newsletter number 12 by Gary Collyer; available at:
http://www.coastlinesolutions.com/news11.htm
Is this
right? Is this wrong?
My personal
opinion is that it is wrong: If nothing has been changed - then why remove the
clear rule from UCP 500. I can not imagine way.
On the
political scene there is mantra saying "what you can not explain - you can
not defend".
With that
in mind I overheard a phone conversation by total coincidence. I will relay the
full un-edited transcript here. It is between the “poor banker” and the “smart
beneficiary”:
Poor banker:
God morning
this is the poor banker. You have submitted documents under LC number GGG-45-A.
They are at your usual high standard – there is however one small detail that
you need to correct. The shipped on board notation on the bill of lading is
insufficient. Since it indicates a place of receipt different from the port of
loading, the on board notation must also include the port of loading stipulated
in the LC as well as the name of the vessel on which the goods have been loaded
Smart
beneficiary:
Why is
that?
Poor
banker:
Well –
according to UCP 600 article 20,a,ii it must indicate that the goods have been
shipped on board a named vessel at the port of loading stated in the credit.
Smart
beneficiary:
But it
does!? The required port is mentioned in the port of loading field – and it
bears a pre-printed shipped on board wording. What is the problem?
Poor
banker:
Since there
is a place pf receipt different from the port of loading – it is not
sufficiently clear that the on board wording relates to the vessel in the “port
of loading” field.
Some bills
of lading states that the shipped on board statement refers to the named vessel
OR the conveyance carrying the cargo from the place of receipt.
Smart
beneficiary:
Okay then,
but am I correct in saying that what you are asking me right now was reflected
clearly in the UCP 500 – but taken out of the UCP 600.
Poor
banker:
That is
correct.
Smart
beneficiary:
Then kindly
tell me why it was taken out of the UCP 600 – if it is still so.
Poor
banker:
This was
discussed with ICC’s Transport Commission and it was decided that the structure
of this article should reflect the role of a bill of lading i.e., to cover
shipment from a port to a port.
The “place
of receipt different from port of loading part” as you mention was seen to
actually encourage a bill of lading to evidence pre-carriage – whereas if this
were the intention, the LC should have called for a multimodal transport
document.
Smart
beneficiary:
You confuse
me a bit there. What you are saying indicates to me that such “place of
receipt” would be something else than a port. How can you otherwise talk of
multimodal transport document? If that was the case under UCP 500 – then how
come this “place of receipt” is now a potential port under UCP 600?
Poor
banker:
You said
the word: “potential” – the point is that the banker must be 110% sure that the
goods are on board at the required port!
Smart
beneficiary:
Okay then.
I must say that I simply do not understand why it was taken out if it is still
so. Tell me this then: Is it not correct that paragraph 82 from the 2003
version of ISBP was not carried through to the 2007 version?
Poor
banker:
That is
correct!
Smart
beneficiary:
Why?
Poor
banker:
Because
this paragraph was directly linked to UCP 500 article 23,a,ii – regarding the
place of receipt different from the port of loading.
Smart
beneficiary:
Does this
mean that the practice reflected in ISBP from 2003 paragraph 82 does not apply
anymore?
Poor
banker:
Oh no. It
still applies! There is an Opinion from the ICC with the same content. This one
will also apply in respect of UCP 600 sub-article 20,a,ii.
Smart
beneficiary:
Why was it
removed then?
Poor
banker:
Because the
lines it referred to in the UCP 500 was removed.
Smart
beneficiary:
But you
just said it would refer to other lines – with same intent – in the UCP 600?
Poor
banker:
Yes!
Smart
beneficiary:
Why was it
removed then?
Poor
banker:
Because the
lines it referred to in the UCP 500 was removed.
Smart
beneficiary:
Ehhh hmm.
Think we are going in circles. I will hang up now – I need to make a few phone
calls. I must change the bill of lading, bank and payment instrument before the
end of the day. So please excuse me. I am in a hurry. Goodbye.
Poor
banker:
??!!