Case 1
The credit is requiring original ocean B/L but when reviewing presented shipping documents, it was issued by company "A" of "B" country without agency's title but just a agency of company "A" of "B" country and a signature. So there was a payment rejection because an agency's title of intended vessel was omitted.
Case study
1. Signing method of original B/L
As per U.C.P., a original B/L is acceptable if it has shipper's title and named agent that act as a shipping agency. However, if a named agent of a shipper is signing in proxy, the indication must be of the shipper's title that the named agent is in proxy for. (The Sub-Article 23(a-i) of U.C.P 500).
Conclusion
The fifth amended U.C.P., it states that a accurate singing method is when a proxy is processing shipping or documents, the proxy must indicate agency's title and the title of the documents or the shipper at the same time. So the payment rejection for this case is reasonable.
Case 2
The debtor's company X received a credit from country A for import goods and the credit was requiring original B/L, 3/3 original clean on board ocean bill of Lading. Upon reviewing received documents, it was receivable bill of lading, stating on board notation on the original B/L, and the signature was discontent to the issuer of the original B/L. So the payment was rejected due to the signature discrepancy of on board notation and the issuers.
Case study
1. On board notation of Clean On Board Ocean B/L
As per Clean On Board Ocean B/L, it requires to indicate that the products are on board or noted in the intended vessel. Among Clean On Board Ocean B/L, there are shipped or on board B/L and receivable B/L. The shipped or on board B/L is a orignal B/L issue after the goods are loaded into the intended vessel, and the receivable B/L is a orignal B/L that will be issued when a vessel is decided after intended vessel receives goods. Therefore, with a receivable B/L, it requires on board notation separately for a bank to accept. On board notation means, indicating a shipping name and the date for on board and it will be effective if a shipper or the proxy sign it.
2. Original B/L that requires On board notation
Original B/L that requires On board notation is receivable B/L, and there are a original B/L issued by a carrier agency, Combined Transport B/L. And related to the intended vessel, either intended vessel or a orignal B/L with similar condition that loaded as intended vessel, it must have On board indication.
3. Signature of On board notation
Signing On board notation can be former or informally done and it doesn't have to be the same person's signature as a person who signed for original B/L. The signature for On board can be done by a carrier, the master of a ship, owner of the ship or the proxy. (I.C.C. pub 489 case No.243).
Therefore, this particular receivable B/L case has no relevant reason to reject payment for the signature discrepancy between On board notation and original B/L.
Case 3
Per Clean On Board Ocean B/L the port of loading is designated as A port and taking in charge is B region. Arrival is to be C port, and the final destination of the products are D region. Per the credit terms, the port of loading is A port, discharging port is C port but since there is additional taking in charge region and the final destination, the payment was rejected for the discrepancy.
Case study
1.Port of loading and discharging port within Clean On Board Ocean B/L
Per the fifth amended U.C.P., the port of loading and discharging port must be indicated exactly as what is on Clean On Board Ocean B/L. Therefore, if there is only 1) port of loading and other taking in charge region indication, if the original B/L indicates discharging and other final destination and 2) the original B/L indicated only intended port of loading and discharging port can be rejected by a bank. But if discharging port is consistent to the credit terms and only the port of loading is different from the port indicated in the credit it can be fixed as long as it indicates the name of intended vessel that is loaded with products as it regulated Onboard indication credit.
(The Sub-Article 23(a-jj) of U.C.P 500).
2. Original B/L without discharging port indication
The Clean On Board Ocean B/L requires discharging port to be indicated for fact. So if a orignal B/L indicates just any u.s. port or fail to indicate discharging port, it can rejected for acceptance. (I.C.C. pub 489 case No.240) And the orignal B/L indicating only the final destination but not indication of discharging port is also subject to rejection.
Conclusion
For this particular case, the Clean On Board Ocean B/L can be acceptable because the port of loading and discharging port is consistent to the credit terms and only taking in charge and the final destination was additionally recorded. (The Sub-Article 23(a-iii) of U.C.P 500)
Case 4
On the terms of a credit it states "transshipment not allowed", but the goods were shipped by container, it was transshipment to other vessel from H port, received separate B/L and presented the two B/L but the payment was rejected.
Case study
1. Transshipment in Clean On Board Ocean B/L
Per U.C.P., the Transshipment is referred as within a marine transportation process from a port of loading designed to a discharging port as per the credit term, loading/unloading, re-shipped from intended vessel to another vessel. And as long as Transshipment is not prohibited in a credit, a indication of Transshipment on a credit is acceptable. Except, it limites that the whole marine transportation has to be with unity and identical orignal B/L.
(The Sub-Article 23(vi-e) of U.C.P 500) But again, if a credit states prohibit in Transshipment, it can not be accepted.
2. Container shipment and Transshipment
If a shipment is transporting by a container vessel, Transshipment is possible even if the credit prohibits Transshipment. That is, even if the original B/L reads "It will be Transship" or "Reserving the right to Transship" it is acceptable. But in this case, the marine transportation has to be done with one identical original B/L.
If there is more than one original B/L or if it is not identical one it may not be acceptable even thought a shipment was done by a container vessel. The limitation is not only with the container vessel but also applicable with trailer/LASH vessels too.
Conclusion
Transshipment can not be acceptable even if the goods were shipped using container vessel because there is more than one original B/L according to the vessel companies.
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