Charter Party Bill of Lading

How to Determine Date of Shipment on a Charter Party Bill of Lading?

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How to determine date of shipment on a Charter Party Bill of Lading?

Date of shipment is one of the key definitions in a letter of credit transaction. It is used to determine

  • whether shipment made on time or not (in other words a late shipment has been effected or not)
  • whether documents presented within the presentation period or not (in other words a late presentation has been effected or not)
  • maturity date of the time draft
  • maturity date of a deferred payment letter of credit.

Date of shipment can be determined in two ways on a Charter Party Bill of Lading.

  • In the first scenario we will face a situation where Charter Party Bill of Lading does not contain any date of shipped on board notation.
  • In the second scenario we will be having a Charter Party Bill of Lading which contains a dated shipped on board notation.

Option 1 => There is no shipped on board notation exists on the Charter Party Bill of Lading:

  • The date of issuance of the Charter Party Bill of Lading will be deemed to be the date of shipment.

Option 2=> Charter Party Bill of Lading indicates, by stamp or notation, a date of shipped on board: Notation date will be deemed to be the date of shipment as specified below:

  • Date of shipped on board notation/stamp => this date will be deemed to be the date of shipment

Example: On the below figure you can see a shipped on board notation which is located on the bottom of a Charter Party Bill of Lading.

As there is a dated on board notation exist on the Charter Party Bill of Lading, date of shipment will be deemed to be this shipped on board notation date which is 30.December.2012.

charter party bill of lading date of shipment

What are the Differences Between a Bill of Lading and a Charter Party Bill of Lading?

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What are the Differences Between a Bill of Lading and a Charter Party Bill of Lading?

Under the current letter of credit rules and international standard banking practices, if a letter of credit calls for a marine bill of lading, then banks do not accept a charter party bill of lading in lieu of a marine bill of lading.

On this article I will try to answer the question “Why a charter party bill of lading is not acceptable in place of a marine bill of lading?” by clarifying the main differences between each transport documents.

Differences Between a Charter Party Bill of Lading and Marine Bill of Lading:

Charter Party Clause: Charter party bill of lading contains a clause stating that it is subject to a charter party. Marine bill of lading does not contain such a clause or similar wording.

Signatures:

  • Marine bills of lading can be signed by;
    • the carrier or a named agent for or on behalf of the carrier, or
    • the master or a named agent for or on behalf of the master.
  • Charter party bills of lading can be signed by;
    • the master or a named agent for or on behalf of the master, or
    • the owner or a named agent for or on behalf of the owner, or
    • the charterer or a named agent for or on behalf of the charterer.

Usage:

  • Charter party bills of lading will be used mainly for big bulk shipments such as 20.000 mtons of soybean transportation from a US port to a Chinese port.
  • Marine bills of lading mostly used for containerized cargo that is transported by regular line container vessels.

Examples of Charter Party Clauses:

Below indications could turn a marine bill of lading into a charter party bill of lading. (Source : www.commerzbank.com)

  • “Prepayable freight paid as per charter party dd. …”
  • “Freight payable as per charter party dd. …”
  • “Freight as agreed”
  • “Bill of lading to be used with charter parties”

What is Congenbill Bill of Lading?

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congenbill

Congenbill is a type of charter party bill of lading which is widely used in international transportation.

Congenbill 2007 is the latest version of standard charter party bill of lading which is issued and approved by the BIMCO’s Documentary Committee.

BIMCO is a well established international shipping association and its long form is also known as “The Baltic and International Maritime Council”.

Congenbill 2007

  • According to the UCP 600 rules a bill of lading which contains an indication that it is subject to a charter party will be classified as a charter party bill of lading. Congenbill 2007 Bill of Lading indicates on its face “To be used with charter parties”. This makes Congenbill 2007 a charter party bill of lading according to the letter of credit rules.
  • The Congenbill Charter Party Bill of Lading can be used wide range cargo that does not need special handling. Because of this reason it is one of the most popular Charter Party Bill of Lading (CPBL) in use.
  • Sample Congenbill 2007 bill of lading is reachable from this link.

There are other charter party bills of ladings that have been issued by BIMCO. These are specific charter party bills of lading suitable for limited niche charter party operations.

Some examples of specific charter party bills of lading issued by BIMCO:

  • AUSTWHEAT BILL
  • BIMCHEMVOYBILL 2008
  • CEMENTVOYBILL 2006
  • INTANKBILL 78
  • GRAINCONBILL

Charter Party Bill of Lading

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charter party bill of lading

On this page I will try to explain you “Charter Party Bill of Lading” and its applications in letters of credit transactions.

Charter Party Bill of Lading is one of the transport documents that is specifically governed by the letter of credit rules.

The international shipping industry is responsible for the carriage of around 90% of world trade.

Shipping is the life blood of the global economy. Without shipping, intercontinental trade, the bulk transport of raw materials, and the import/export of affordable food and manufactured goods would simply not be possible.(1)

International sea transportation can be divided into 3 main cargo groups:

  • containers,
  • liquid bulk cargo (or “wet” trades such as crude oil, petroleum products and gas) and
  • solid bulk cargo (or “dry” trades such as coal, iron ore and grain).(2)

sea transportation sub-groupes

Maritime container transportation is carried out by container ship operators, who produce negotiable bill of loading or non-negotiable sea waybill as transport documents.

Unlike container transportation, bulk cargo shipment requires special types of vessels and is not suitable for liner services.

As a result, bulk cargo transportation is carried out via hired vessels. In maritime glossary, hiring a vessel is called “Charter Party”.

Definition of Charter Party and Charter Party Bill of Lading

Charter Party Bill of Lading is the transport document of the shipments, which made via vessels subject to charter party contracts.

How to Use Charter Party Bill of Lading in Letters of Credit Transactions:

Charter party bill of lading is covered under article 22 of UCP 600.

A bill of lading, however named, containing an indication that it is subject to a charter party (charter party bill of lading), must appear to:

  1. be signed by:
    – the master or a named agent for or on behalf of the master, or
    – the owner or a named agent for or on behalf of the owner, or
    – the charterer or a named agent for or on behalf of the charterer.

Any signature by the master, owner, charterer or agent must be identified as that of the master, owner, charterer or agent.

Any signature by an agent must indicate whether the agent has signed for or on behalf of the master, owner or charterer.

An agent signing for or on behalf of the owner or charterer must indicate the name of the owner or charterer.

2. indicate that the goods have been shipped on board a named vessel at the port of loading stated in the credit

3. indicate shipment from the port of loading to the port of discharge stated in the credit. The port of discharge may also be shown as a range of ports or a geographical area, as stated in the credit.

4. be the sole original charter party bill of lading or, if issued in more than one original, be the full set as indicated on the charter party bill of lading.

A bank will not examine charter party contracts, even if they are required to be presented by the terms of the credit. (source : UCP 600)

Special Hints Regarding the Charter Party Bill of Lading From ISBP (International Standard Banking Practice):

  1. If a credit requires presentation of a charter party bill of lading or if a credit allows presentation of a charter party bill of lading and a charter party bill of lading is presented UCP 600 article 22 is applicable.
  2. A transport document containing any indication that it is subject to a charter party is a charter party bill of lading under UCP 600 article 22.
  3. If a credit does not state a notify party, the respective field on the charter party bill of lading may be left blank or completed in any manner.

References:

  1. International Chamber of Shipping, http://www.ics-shipping.org/shipping-facts/shipping-and-world-trade (Retrived: 06.April.2018)
  2. Dry bulk cargo shipping — An overlooked threat to the marine environment? Matthias Grotea, Nicole Mazureka, Carolin Gräbscha, Jana Zeilingerb, Stéphane Le Flochc, Dierk-Steffen Wahrendorfd, Thomas Höfera, https://www.sciencedirect.com/science/article/pii/S0025326X16303861 (Retrived: 06.April.2018)