shipment date not stipulated
-
hatemshehab
- Posts: 220
- Joined: Fri Apr 05, 2019 5:19 pm
shipment date not stipulated
If a letter of credit does not stipulate shipment date, and shipment was effected next day following the expiry date because the expiry date fell on a day on which the bank was closed, do you consider this a discrepancy?
shipment date not stipulated
Dear Mr. Shehab,
UCP & ISP DIFFER IN EXPIRY EXTENSION
There is a major difference between UCP 500 and ISP 98 on extension of the DC/SBLC expiry date. Article 17 in UCP 500 does not allow such extension due to force majeure and similar reasons. But it is OK with ISP 98. Hence we assume that you mean sub-Article 44 (a) of UCP 500 on extension of DC expiry.
Having said that, we think that the provisions in the UCP or ISP, whatever matters, for extension of the expiry date of a DC/SBLC is meant soley for presentation of documents only, not ALSO to cover other performances, such as the DC shipment requirements.
It only extends the 21 days "stale BL" PRESENTATION DATE under sub Article 43 (a) but not ALSO to the SHIPMENT DATE itself, whether specified in the DC or not. "Latest date for presentation of BL" is NOT the same as "latest date for shipment".
A JOB FOR DAVID COPPERFIELD
From simple logic, by the time the stipulated documents are "presentation ready", the shipment should have been completed, at least a couple of days before. It may take David Copperfield to be able to load the goods on board the vessel, to issue the BL and to present the documents on the same day. What about if the shipment is not made in the beneficiary's place of business? This situation may not exist from shipping practice point of view.
Please advise if this is a hypothetical query meant to give us some mental exercises in order to get rid of the starch as warned by Jeremy today in his response to ours?
T. O. Lee
http://www.tolee.com
[edited 10/18/02 3:48:45 AM]
UCP & ISP DIFFER IN EXPIRY EXTENSION
There is a major difference between UCP 500 and ISP 98 on extension of the DC/SBLC expiry date. Article 17 in UCP 500 does not allow such extension due to force majeure and similar reasons. But it is OK with ISP 98. Hence we assume that you mean sub-Article 44 (a) of UCP 500 on extension of DC expiry.
Having said that, we think that the provisions in the UCP or ISP, whatever matters, for extension of the expiry date of a DC/SBLC is meant soley for presentation of documents only, not ALSO to cover other performances, such as the DC shipment requirements.
It only extends the 21 days "stale BL" PRESENTATION DATE under sub Article 43 (a) but not ALSO to the SHIPMENT DATE itself, whether specified in the DC or not. "Latest date for presentation of BL" is NOT the same as "latest date for shipment".
A JOB FOR DAVID COPPERFIELD
From simple logic, by the time the stipulated documents are "presentation ready", the shipment should have been completed, at least a couple of days before. It may take David Copperfield to be able to load the goods on board the vessel, to issue the BL and to present the documents on the same day. What about if the shipment is not made in the beneficiary's place of business? This situation may not exist from shipping practice point of view.
Please advise if this is a hypothetical query meant to give us some mental exercises in order to get rid of the starch as warned by Jeremy today in his response to ours?
T. O. Lee
http://www.tolee.com
[edited 10/18/02 3:48:45 AM]
-
hatemshehab
- Posts: 220
- Joined: Fri Apr 05, 2019 5:19 pm
shipment date not stipulated
Dear Mr. Lee
Thank you for your quick response. The query stemmed from a long ago discussion while delivering a training course in Jordan. It came up to my mined just yesterday since originally we had different views on the answer. The query is meant under UCP 500 and it is real.
You are right to distinguish the issue as different if it is under UCP or ISP. The clue to the query is article 44 (a) as rightly pointed by you. My opinion is that it is a discrepancy because the automatic extension to the L/C expiry date does not apply to shipment date. I wanted to share opinions on that perhaps one may have missed something in his interpretation to the subject and to benefit others as well.
I need to add that the documents were surrendered by beneficiary a week later and ultimately was settled by the applicant. Prior to that settlement there was a debate in the issuing bank whether to consider the shipment date appearing on the B/L as a discrepancy or not.
Needless to mention that the presentation period will not be extended in such a case as documents should have been surrendered within the validity of the L/C. However, imagine if the holiday was for 5 days (this hypothetical now) would there be a chance for rejection assuming that documents are otherwise in order?
Thank you for your quick response. The query stemmed from a long ago discussion while delivering a training course in Jordan. It came up to my mined just yesterday since originally we had different views on the answer. The query is meant under UCP 500 and it is real.
You are right to distinguish the issue as different if it is under UCP or ISP. The clue to the query is article 44 (a) as rightly pointed by you. My opinion is that it is a discrepancy because the automatic extension to the L/C expiry date does not apply to shipment date. I wanted to share opinions on that perhaps one may have missed something in his interpretation to the subject and to benefit others as well.
I need to add that the documents were surrendered by beneficiary a week later and ultimately was settled by the applicant. Prior to that settlement there was a debate in the issuing bank whether to consider the shipment date appearing on the B/L as a discrepancy or not.
Needless to mention that the presentation period will not be extended in such a case as documents should have been surrendered within the validity of the L/C. However, imagine if the holiday was for 5 days (this hypothetical now) would there be a chance for rejection assuming that documents are otherwise in order?
shipment date not stipulated
Dear Mr. Shehab,
We follow the politicians in North America not to respond to any hypothetical query. This one is an exception.
From now on, to avoid being regarded as lecturing here, we will start giving hints to cut short our response. The enquirer has to do some work too. This may help him to remember the answer longer, according to human resources development theories we have picked up from the Institute of Training and Development in England.
Our hint is: please read sub Article 44 (a) carefully to get your answer. It should be there, we hope.
We are from http://www.tolee.com
[edited 10/16/02 7:42:21 PM]
We follow the politicians in North America not to respond to any hypothetical query. This one is an exception.
From now on, to avoid being regarded as lecturing here, we will start giving hints to cut short our response. The enquirer has to do some work too. This may help him to remember the answer longer, according to human resources development theories we have picked up from the Institute of Training and Development in England.
Our hint is: please read sub Article 44 (a) carefully to get your answer. It should be there, we hope.
We are from http://www.tolee.com
[edited 10/16/02 7:42:21 PM]
shipment date not stipulated
I would like to thank Mr. Shehab for the tricky query and Mr. Lee for the interesting analysis. I believe in such cases one should look into the intention behind the articles in order to get the correct answer (i.e.) why would the period for presentation of documets be extended by virtue of sub article (44 a). (that is to enable presentment of docs to a bank which was closed, and not to perform under the credit).