FCR -v- CMR

[KimChristensen]

A documentary credit requires presentation of a FCR.
The beneficiary presents a CMR consignment note.

Would you consider this a discrepancy?

Thanks in advance
Kim

[NigelHolt]

Kim,

Happy New Year.

Without liability / responsibility & personally:

It appears, from the (limited) information available, the credit has not called for a road transport document and therefore that sub-Art 28a cannot apply. Also, the fact that a consignment note may be as ‘good as’ or even ‘better’ than a FCR, from the applicant’s perspective, is not relevant in determining its facial compliance. Overall it seems to me that an express term of the credit has been breached. Therefore, I would consider this a discrepancy.

Regards, Jeremy



[edited 1/7/2005 11:07:31 AM]

[Yahya]

Dear Kim,
The requirement of the Credit is a FCR and a FCR is not a transport doc defined under UCP Arts 23-29 and it should be examined as other doc under UCP Art 21.
It is known to be a common practice (unfortunately) that a FCR is sometimes called for being as a Transport doc.
Considering this common practice, the presented CMR may be accepted,provided it appears on its face to be in compliance with the terms and conditions of the Credit and its data content is not inconsistent with the any other required docs and the Credit terms.

Yahya,

[edited 1/7/2005 2:07:18 PM]

[KimChristensen]

Dear Jeremy & Yahya,

I thank you for your comments.

My initial thought was actually the same as Yahya’s view here. That according to ISBP paragraph 43, the title of the document is irrelevant as long as it appears to fulfil the function. So if it is a “forwarder certifying to have received the goods” – then what’s the problem?

After thinking it through, I must say however that I have landed the same place as Jeremy: That this is not the same. A CMR is not a FCR. The CMR may be a better – or stronger – document, but there may be reasons that the FCR has been chosen in this particular case - i.e. if it is an EXW shipment, giving the consignee the opportunity to arrange transport himself. The banker is not to evaluate this of course, this is merely to show that there may be reasons for choosing one instead of the other. Vital is that it is not the same.

I am still in doubt however.

Thanks again.

Kim

[NigelHolt]

Kim,

The amount of info you have supplied is -no offence meant- limited. We do not know exactly what the credit stipulations were regarding the FCR (I would expect a properly issued credit to set out exactly what the FCR must state) nor how -for example- the ICN was signed by the ‘issuer’. I certainly agree that a FCR s/b examined in accordance with Article 21 as ‘clarified’ by para 43 of Pub. 645. However, I assume -perhaps incorrectly- that what has been presented appears -on its face(!)- to be a ‘carrier’ (or ‘transport’) document rather than a ‘(freight) forwarder’ document. In which case, I would consider it discrepant based on the express terms of the credit and Article 21.

Jeremy


[edited 1/7/2005 4:36:07 PM]

[KimChristensen]

Dear Jeremy,

I accept your ”objection” towards the amount of information given. I apologize! You do however assume right, that the CMR in question would comply with article 28; i.e. issued “as carrier”.

Now; I don not think, that we should enter the “forwarder discussion”, but the point I was trying to make, was that provided it was issued by a company that appeared to be a forwarding company, signing in the capacity “as carrier” certifying that the goods were received for transport, then ISBP paragraph 43 could be considered.

Have a nice weekend
Kim

[larryBacon]

Where the LC specifies a particular (non-generic) document, such as a FCR, that document must be presented. The fact that it is not regarded as a transport document by UCP emphasises the point. Otherwise there is a discrepancy.

To state otherwise is like saying that an EUR1 is acceptable where the LC calls for an ATR. We all know that they are the same type of document, but one is not under any circumstances a replacement for the other.

Laurence

[NigelHolt]

Kim,

Don’t forget that para 43 says ‘Documents may be titled as called for in the credit, bear a similar title, or be untitled’. Here the document is, presumably, entitled ‘International Consignment Note’. Therefore it is in breach of para 43.

Jeremy

[edited 1/10/2005 9:17:05 AM]

[KimChristensen]

Dear Jeremy and Laurence,

I thank you for your arguments; Think that I am convinced now

Have a nice day
Kim