A BILL OF LADING OR A MULTIMODAL TRANSPORT DOCUMENT?

QUESTION

Dear Mr. Old Man,

Have a good day.

I have a question and would appreciate your explanation.

It is difficult for me to distinguish between a multimodal transport document and a bill of lading.

In this case, the LC requires shipment from port of loading: Shanghai to port of discharge: Dubai.

However, the transport document presented shows place of receipt: Hangzhou.

1. Is it considered a multimodal transport document when the LC only states field 44E (port of loading) and 44F (port of discharge), without indicating place of receipt or place of final destination?
2. In this case, is an on-board date required? If only the date of issuance appears, can it be considered the shipment date?
3. In this situation, would the first leg of the journey be considered inland or sea transport?

Please help clarify. Many thanks.

KT

———

ANSWER

Hi,

The distinction between a bill of lading and a multimodal transport document often causes confusion in practice, especially when a transport document shows additional places such as a place of receipt that are not mentioned in the LC. In such situations, the key point to remember is that banks examine transport documents based on what the LC requires, not simply on the format or wording of the document presented.

Transport documents must therefore be examined under the article that corresponds to the type of transport document required by the LC, together with the shipment details stated in the LC (for example, those appearing in fields 44A, 44B, 44E or 44F).

In other words, a document is examined according to what the LC requires, not according to the form or title of the document that happens to be presented.

For example, assume an MT700 requires the presentation of a bill of lading, with field 44E showing SHANGHAI as the port of loading and field 44F showing DUBAI as the port of discharge.

If the transport document presented shows:

• Place of receipt: HANGZHOU
• Port of loading: SHANGHAI
• Port of discharge: DUBAI

the document is still examined under UCP 600 article 20 (Bill of Lading), not under article 19 (Multimodal Transport Document).

Some practical guidance may help:

• When the LC states only 44E (port of loading) and 44F (port of discharge), it normally indicates that a bill of lading is expected.
• When the LC states 44A (place of taking in charge) and 44B (place of final destination), it normally indicates that a multimodal transport document is expected.
• When the LC includes three or four of the following fields: 44A, 44E, 44F, 44B, this usually indicates that a multimodal transport document is required.

Where a multimodal transport document is required and the first leg of the journey is by sea, the document must contain an on-board notation indicating the date of loading on board the vessel.

Important Note

According to ISBP 821 paragraph D1(c), when a credit requires the presentation of a transport document other than a multimodal or combined transport document, but it is clear from the routing of the goods stated in the credit that more than one mode of transport will be used, UCP 600 article 19 is to be applied when examining that document.

This situation may arise, for example, when:

• an inland place of receipt or place of final destination is indicated in the credit; or
• the port of loading or port of discharge field is completed with a place that is in fact an inland location rather than a seaport.

In such cases, even though the credit may appear to require a bill of lading, the document is to be examined under UCP 600 article 19 (Transport Document Covering at Least Two Different Modes of Transport).

I hope this explanation is helpful.

Best regards,

Mr. Old Man