ICC Digital Library Forum

1. L/C requires presentation of transport document (RWB) to be consigned to Company X. RWB presented indicates consignee as 'Company X on behalf of Company Y'.

2. L/C requires presentation of transport document to be consigned to Company X and is not specific regarding consignee information in Certificate of Origin. C/O presented indicates consignee as 'Company X on behalf of Company Y'

Does such addition represent a discrepancy both in case 1 and 2?

Best regards.

This seems like a very straighforward YES/NO question but as often with LC issues - it depends!


But a decision must be made and if that decision is to reject then the discrepancies must be stated.

So decision time.......

Lets look at point 2 first.


As the Credit was not specific regarding the consignee information in the Certificate of Origin then it would appear that
the document on its face complies.

The only possible discrepany then is 'inconsistency'between documents.

With 'inconsistency' being a much debated topic it would be interesting to hear other members views on this.



Now to point 1.


The Credit requires presentation of a transport document consigend to Company X.

The transport document presented is consigned to Company X.


I would not reject this document.


Company X acting on behalf of a company Y or any other company is still company X.

Vin

Case 1. Company X on behalf of Company Y means Company X is acting as an agent for Company Y. Company Y is the real consignee of the goods legally.
RWB indicating ‘Company X on behalf of Company Y’ as the consignee does not meet the requirement of the L/C on which it was specified that RWB must consign the goods to Company X.
As such, I would treat it is a discrepancy.

Case 2. The logic for point 1 also applies in this case. I would consider it a discrepancy. However, if Company Y is the applicant of the L/C, then the documents should not be rejected.

I’ve been thinking on and off about this one since its been posted, and changed my mind on a number of occasions. Two of my junior colleagues, who I consulted and have far more ‘hands on’ credits experience than me, had no doubt the documents were complying, on the basis that the goods were consigned to Co X. However, I am not so sure. I am left wondering if Co Z turned up at the destination rail depot and requested delivery of the goods if the carrier would be entitled to deliver them to Co Z. There seems to me to be a possibility that they would.

To get the documents definitely taken up all the beneficiary had to do was simply show Co X as the consignee. Instead, they’ve decided to play silly b-----s and ‘muddied the waters’ by suggesting that Co X may not be the actual consignee. Therefore, if the decision were mine as at now I think I would refuse the documents, on the basis that the credit stipulated that the rwb should show the consignee as ‘Co X’ but that the rwb showed the consignee as ‘Co X on behalf of Co Z’. I would not make any reference to the c/o.

My views:

AD. 1) - acceptable. Consignee is company X as required by L/C.

AD. 2) - acceptable. This does not constitute inconsistency.

Best Regards,

Pavel Andrle

Dear Sirs,

thank you very much for your opinions.

As to case No.1, such an addition caused rather serious problems for the company X, since they have been asked by customs authorities in country X (place of the destination) to pay a 15% fee just because field "consignee" in RWB mentioned company Y (the applicant) being non-resident of that country.

I think it would be good to highlight these issues in forthcoming editions of UCP500.

I totally agree with Jeremy.
I think also that even if "Company Y" is the applicant for the credit, the documents should be rejected if the RWB is not restrictively consigned to this company.
Regards
Antoine Samaha

The original posting stated that the documents in question are RWB & C/O. Neither of these are documents of title. Therefore if they are consigned to Co. X, all other information implying the intended intermediary or ultimate consignee is irrelevant. Neither document is discrepant.

This would be a much trickier question if the document involved was a "to order" B/L. In this case, "consigned to order of Co. X for Co. Y", there is a clear requirement for Co. X to endorse the B/L to Co. Y. There is no such requirement where a RWB is involved.

Laurence
[edited 1/6/2005 8:04:58 PM]

It is my view that the LC was quite specific in its requirements i.e. Consignee to read Company X. Anything that differs from that should definitely prompt a red alert for the party preparing the documentation. It would be also unfair for the confirming / issuing /nominated paying bank to have the onus to determine whether this is right or wrong. I believe that the LC conditions prevail in this instance and the RWB has not been presented in accordance with the actual terms and conditions of the LC.