Movements
ISBP 745 (I.e. the new one to be published later this month) includes
the following (paragraph E28):
Quote
A bill of lading is not to expressly state that goods covered by that
bill of lading will only be released upon its surrender together with one or
more other bills of lading, unless all of the referenced bills of lading form
part of the same presentation under the same credit.
For example, “Container XXXX is covered by B/L No. YYY and ZZZ and can
only be released to a single merchant upon presentation of all bills of lading
of that merchant” is considered to be an express statement that one or more
other bills of lading, related to the referenced container or packing unit,
must be surrendered prior to the goods being released.
Unquote
In this blog post I will explain the background for this practice.
In container shipments, the shipping lines use a certain terminology to
indicate how the shipper is to deliver goods to the shipping line at the place
or port of dispatch and subsequently how they are to be released to the
consignee at destination.
This is often referred to as “movements.”
This information is important in container shipments to establish
liability and freight amount depending on whether the container is stuffed by
the shipper or the shipping line and is due to be stripped by the consignee or
the shipping line.
In many cases sea containers contain more than one consignment. Quite
often goods are “consolidated,” meaning, for example, that a freight forwarder
has received a number of consignments of general cargo in separate packages for
different shippers to different consignees, packed those together into one
container, and then booked the full container with the shipping line as “one
container.”
The destination agent will usually strip the container upon arrival and
release each consignment separately to the respective consignees after
receiving the bills of lading issued. Consolidation is quite normal and is
generally acceptable in documentary credit transactions, with one exception.
Sometimes the transport document, most commonly a bill of lading, is
structured in a way so as to indicate that the goods shipped in the container
are covered by more than one bill of lading, and that all bills of lading
related to the container must be presented to the carrier in order for the
container to be released. Such a document is not acceptable under the documentary
credit unless all issued bills of lading form part of the same presentation.
This is to protect the separate buyer that has already paid for the goods from
being denied possession.
When goods are transported in containers, “movements” indicate how the carrier
receives the goods and how they are to be delivered to the consignee upon arrival
at the destination.
There are two basic scenarios:
1. When the goods are delivered and/or released in an un-containerized form, but scheduled to be shipped in a container, this is called “Less than container load” (LCL), and goods are handled in a “container freight station” (CFS).
2. When the goods are delivered and/or released in a containerized form, this is called “Full container load” (FCL), and the container is handled in the “container yard” (CY). Alternatively, goods may be picked up at shipper’s door and/or delivered to the consignee’s door. This is called “store door” (SD).
This information is important for determining who has ‘stuffed’ the
container, and thereby who can be held responsible if the goods are missing or
damaged. The “codes” in various combinations indicate:
* Who is responsible for loading/unloading the container
* How the consignment is delivered to the shipping line
* How it is released to the consignee at the end of the voyage
For example LCL/FCL means that the shipper delivers the goods to the
carrier as General Cargo (as separate packages), Carrier releases the goods to
the consignee in one full container. This combination may be used when one
consignee has several suppliers in the same country. Suppliers deliver their
part to the carrier, who stuffs the container and ships it to the consignee.
The consignee then collects the whole container and is responsible for
unloading it.
In such case, there MAY be a reason for refusal when combined with other
information on the transport document. The combination that most commonly
creates a discrepancy is as follows:
1. The transport document shows the following movement: LCL/FCL, AND
2. The transport document shows that the goods covered by the document
are “part load,” meaning that the container contains more cargo than the goods
shown on the bill of lading.
For example:
”Container ABCU123456-0 is covered by B/L No. A001 and A002, and can
only be released to a single merchant upon presentation of all BS/L of that
merchant”.
By structuring the bill of lading this way, the shipping line on one
hand indicates that goods are to be released as a “Full container load” (The
shipping line will not strip the container at port of discharge, but will
arrange for release of the full container). On the other hand, it indicates
that the container holds more than the consignment covered by the bill of
lading in hand.
To comply with these terms, both (or all) related sets of bills of
lading must be presented before the shipping line will release the container.
Document checkers need proper understanding of the transport industry terminology
in such instances. While document checkers within banks cannot be expected to
be experts in all fields (transport, insurance, etc.), they should have some knowledge
of the terminology in order to properly examine transport documents.
ISBP 745 has taken one step further than its predecessor, in adding the
above example. This is helpful indeed.
More information about movements in my book UCP 600 Transport Documents
(http://www.remburs.com/UCP%20600.htm).
Take
care of each other and the LC!
Kim