The sub-article limits the period for presentation of documents after shipment (if such period of time is not limited by documentary credit)
Why doesn't the sub-article waive this requirement if shipment is to be covered by a non negotiable transport document?
Sub-Article 43a
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khalilhamad
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georgenedumparambil
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Sub-Article 43a
If payment is being made against non-negotiable copy of BL, it raises the question whether the Credit is a documentary credit or a Standby Credit. If it is a Standby Credit, then there are whole-lot of clauses in UCP500 that would not be made applicable. If it is a documentary credit, then in my view the matter will have to be handled by the players themselves on a case-by-case basis, depending upon the reasons for seeking payment against NN copy of of BL. Sample questions to be answered (1) is the issuing bank comfortable in not having the title documents pass through it? (2) where are the originals sent to? (3) will a presentation beyond 21 days of the NN copy of BL to the bank will tantamout to corresponding delay in submission of original BLs to wherever it is meant to go to? etc.etc.
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RajivGupta
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Sub-Article 43a
From the banking perspective, banks opening L/C should insist for original documents to pass through it. Secondly, in many countries local laws dont permit original documents handling in this manner.
Re where the original documents go & whether they reach in time. This is an extraneous matter & the bank is in no way concerned with it once the banks, L/C openers/beneficiary accept this condition. This does not make it a Standby L/C because negotiation is to take place on the basis of N/N docs. This may be necessary in some cases where the vessel transit time is 2/3 days. For eg shipments between Sri Lanka- india, India-Malaysia.
Re timely submission the rules as given in UPDC will apply whether it is a negotiable or N/N B/l. It does not alter the stipulations of UCP 500.
Re where the original documents go & whether they reach in time. This is an extraneous matter & the bank is in no way concerned with it once the banks, L/C openers/beneficiary accept this condition. This does not make it a Standby L/C because negotiation is to take place on the basis of N/N docs. This may be necessary in some cases where the vessel transit time is 2/3 days. For eg shipments between Sri Lanka- india, India-Malaysia.
Re timely submission the rules as given in UPDC will apply whether it is a negotiable or N/N B/l. It does not alter the stipulations of UCP 500.
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isamkhalid
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Sub-Article 43a
The question relates to whether (or not) it is useful to limit the period for presentation of documents (after shipment)where such shipment is effected by a non-negotiable transport document taking into consideration that goods can be delivered without presentation of the transport document.
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AbdulkaderBazara
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Sub-Article 43a
Article 43a does not differentiate between Negotiable and non-negotiable transport documents. So the 21 days period applys to both unless the applicant indicated otherwise. However, in practice, non-negotiable transport document is not required at destination to secure delivery of goods. Therefore, one may tend to assume that the 21 days period does not apply for non-negotiable transport document.
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larryBacon
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Sub-Article 43a
The intent of this Article is to give a time limit for presentation of documents which is independent of the beneficiary, but linked to the required action under the credit (usually shipment of goods). If the transport document called for is non-negotiable, then there may be other documents for presentation which are critical, e.g. legalised C/O. In this case, if there were no time limit on presentation based on the date of shipment, the beneficiary may present documents in order, but it may be too late to prevent the applicant incurring extra charges because of the delay in receiving the requested documents.
Non-negotiable documents may be either originals or copies (e.g. original AWB or copy B/L), but this is not relevant as to whether presentation is required, as such presentation is mandatory or not dependent on the documents called for under the L/C.
Laurence A. J. Bacon
laurence_aj@hotmail.com
Non-negotiable documents may be either originals or copies (e.g. original AWB or copy B/L), but this is not relevant as to whether presentation is required, as such presentation is mandatory or not dependent on the documents called for under the L/C.
Laurence A. J. Bacon
laurence_aj@hotmail.com
Sub-Article 43a
We think this query is not very clear as to the meaning of "non-negotiable transport document".
As a transport documents expert, ACADEMICALLY, we think that this term should mean an ORIGINAL "straight" BL that is consigned to the name of a person (or a legal person), the buyer or a bank. Hence the one whose name appears in the consignee box must claim the cargo upon arrival and he cannot transfer the ownership by endorsement to another person. This is the meaning of a "non-negotiable" transport doucment. A sea waybill, air waybill or a "straight" BL are examples.
We also understand that in the banking community, it may also mean a copy that is not valid for claiming cargoes on arrival. It is simply a carbon copy of the set of 3 original negotiable (with Consignee: To Order) BL. The bankers who have commented above seem to take this meaning, although to avoid confusions, they should have used the term "COPY" instead. Taking this meaning, it should be used in a standby credit environment.
According to Article 1 of UCP 500, the articles may apply to standbys only where they are applicable or suitable. And sub-article 43 (a) is obviously not appropriate in standby operation environment. That is one of the reasons why we have ISP 98.
If the enquirer means a "straight" consignee transport document, such as an original sea waybill, or a "straight" BL, then sub-article 43 (a) of UCP 500 also applies.
The purpose of fixing a latest date for presentation after shipment is to prevent the goods to turn not merchandisible, such as out of fashion for garments, expiry of medicines, out of date for motor cars, so on and so forth. If the presentation is late, the buyer may have to pay heavy demurrage. This is the whole purpose of this sub article.
We are from www.tolee.com
[edited 6/20/01 7:00:34 PM]
As a transport documents expert, ACADEMICALLY, we think that this term should mean an ORIGINAL "straight" BL that is consigned to the name of a person (or a legal person), the buyer or a bank. Hence the one whose name appears in the consignee box must claim the cargo upon arrival and he cannot transfer the ownership by endorsement to another person. This is the meaning of a "non-negotiable" transport doucment. A sea waybill, air waybill or a "straight" BL are examples.
We also understand that in the banking community, it may also mean a copy that is not valid for claiming cargoes on arrival. It is simply a carbon copy of the set of 3 original negotiable (with Consignee: To Order) BL. The bankers who have commented above seem to take this meaning, although to avoid confusions, they should have used the term "COPY" instead. Taking this meaning, it should be used in a standby credit environment.
According to Article 1 of UCP 500, the articles may apply to standbys only where they are applicable or suitable. And sub-article 43 (a) is obviously not appropriate in standby operation environment. That is one of the reasons why we have ISP 98.
If the enquirer means a "straight" consignee transport document, such as an original sea waybill, or a "straight" BL, then sub-article 43 (a) of UCP 500 also applies.
The purpose of fixing a latest date for presentation after shipment is to prevent the goods to turn not merchandisible, such as out of fashion for garments, expiry of medicines, out of date for motor cars, so on and so forth. If the presentation is late, the buyer may have to pay heavy demurrage. This is the whole purpose of this sub article.
We are from www.tolee.com
[edited 6/20/01 7:00:34 PM]
Sub-Article 43a
I have found comments given by Lawrence Bacon re. purpose of the time limit of 21 days being applicable for "non-negotiable" transport documents as the closest to the initial question and I agree with him.
On the other hand as I see from comments given by T.O.Lee, who draws our attention on the fact that also a transport document generally understood as being negotiable can be in fact issued in "non-negotiable" way, the original question could have been rather:
Why doesn't the sub-article waive this requirement if shipment is to be covered by a transport document, which is not document of title?
Pavel Andrle
On the other hand as I see from comments given by T.O.Lee, who draws our attention on the fact that also a transport document generally understood as being negotiable can be in fact issued in "non-negotiable" way, the original question could have been rather:
Why doesn't the sub-article waive this requirement if shipment is to be covered by a transport document, which is not document of title?
Pavel Andrle
Sub-Article 43a
Dear Mr Andrle,
You seem to have misunderstodd our real intent. By "non negotiable form" we mean "copies". Please interpret from the context rather than words in isolation. Thanks for your concern of our opinions.
T. O.
[edited 8/30/01 1:37:55 AM]
You seem to have misunderstodd our real intent. By "non negotiable form" we mean "copies". Please interpret from the context rather than words in isolation. Thanks for your concern of our opinions.
T. O.
[edited 8/30/01 1:37:55 AM]
Sub-Article 43a
I fully agree with Mr. Pavel. I also understand that Mr. Vincent Maulella (Retired from J. P. Morgan Chase) has written on the subject in one of "Documentary Credit World" issues.
Why should there be a time limit for presentation of documents when transport documents like CPBL, AWB, TCN, NNBL,courier, post receipt etc... when goods could be released without production of the documents. We all know why the sub-article does not apply when no transport documents are required. The question is why the sub-article applies to all transport documents, irrespective of whether they are documents of title or not.
Why should there be a time limit for presentation of documents when transport documents like CPBL, AWB, TCN, NNBL,courier, post receipt etc... when goods could be released without production of the documents. We all know why the sub-article does not apply when no transport documents are required. The question is why the sub-article applies to all transport documents, irrespective of whether they are documents of title or not.