ANOTHER CASE OF ASSIGNMENT OF PROCEEDS

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1. 

   pinkydiep

   November 27, 2013 at 3:11 pm

   Hi Mr OldmanCERTIFICATE OF QUALITY NOT SHOWING SURVEY REPORT AT LOADING PORT AS PER L/C REQUIRED. IS IT A DISCREPANCY?L/C requires as follows:In the field 46A: CERTIFICATE OF QUALITY ISSUED BY THE THIRD PARTY INSPECTOR AT LOADING PORT. LOADING PORT: AAA PORT, INDIA Documents received at our bank in which Cert of quality described as follows:-Cert of quality issued by SGS that mentioned place of attendance at the manufacturer’s works at JAMURIA ( we check JAMURIA is belongs India) at date….but not the loading port. Is it considered as a discrepancy? Tks n best regardsPinkydiep

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2. 

   mroldmanvcb

   November 27, 2013 at 3:11 pm

   Hi,I would like to quote herewith ICC Opinion TA766 for your reference. I would like to drawn your attention to ICC’s answer to the question regarding Certificate of Weight. Please check if your case is similar to the case in TA766. I’m afraid not.No good answer without seeing the document.Regards,Mr. Old Man——————Official Opinion TA766 – Unpublished UCP 600From UCP600 – UCP 600 sub-article 14 (f)QUERYWe seek the opinion of the ICC Banking Commission on a letter of credit transaction that has drawn two dissimilar views amongst the members in our association.It concerns certificates and the place of the certification versus the place of their issuance, and whether such certificates are compliant or discrepant. The L/C is subject to UCP 600 and the facts are:i) L/C conditions include:(a) Certificate of Weight issued by PT [G Company] at load port.(b) Certificate of Sampling & Analysis issued by PT [G Company] at load port.ii) Documents presentedThe two documents were duly presented but:(a) Certificate of Weight does not indicate or bear the words "issued at load port".(b) Certificate of Sampling & Analysis is worded: "This certificate is issued at loading port".iii) Further information appearing on the Certificate of Weight- the loading port is shown as MUARA SABAK ANCHORAGE, JAMBI, INDONESIA (the relative bill of lading shows the same)the document is signed as follows:Signed for and on behalf ofPT. [G Company]for[A stamp is inserted bearing the name PT [G Company][signature]Suwandi- its letterhead address is BANDUNG, INDONESIA- the last clause reads: "This is to certify that the weight Coal of Indonesia Origin in Bulk (Indonesian Steam (Non-Coking) Coal) loaded on Board the vessel as determined by draft survey at loading port is: XX Metric Tons."iv) The compliance group's argumentThis group argues compliance because the certificate of weight was issued by PT [G Company], as called for, and it is clear that the weight of the merchandise was determined at the loading port.Presumably, it is because the merchandise is capable of losing/gaining considerable weight during its journey and up to the moment it is discharged, that its weight at loading port matters most, and not so much where the certificate is issued.In other words, as far as a weight certificate is concerned, "weight determined at" is the same as or better than "issued at".Therefore, the certificate is acceptable.v) The discrepancy group's argumentThis group's main argument is found in the way the discrepancy is worded:"Certificate of Weight does not evidence that it was issued at load port"That is, there is nothing to show that this document was issued at JAMBI.Beneath the signature, the named place where this document was issued and signed (Suwandi) is not JAMBI, and neither is the letterhead address (BANDUNG).And, unlike the Certificate of Sampling and Analysis, it does not expressly state that it was issued at load port.In other words, this group is not so interested in where the weight of the merchandise was determined or why it should be so, but where the certificate is issued, as stipulated in the L/C.Thus, for this group, the L/C condition that the certificate is to be issued at the load port has not been fully met.Our association would appreciate the opinion of the ICC Banking Commission on these issues.AnalysisThe credit stipulated that the Certificate of Weight and the Certificate of Sampling & Analysis was to be issued by PT [G Company] and required each certificate to be issued "at load port".The query in this case pertains to the interpretation of the requirement for the Certificate of Weight to be issued at load port; in particular whether there is a requirement for the certificate to state that it has been issued at the load port. The Certificate of Sampling & Analysis contains the wording: "This certificate is issued at loading port", and therefore is not the subject of this query.The Certificate of Weight was issued on the letterhead of PT [G Company] Bandung, Indonesia without any specific reference as to the place of issue. It did, however, indicate "This is to certify that the weight Coal of Indonesian Origin in Bulk (Indonesian Steam (non-coking) Coal) loaded on board the vessel as determined by draft survey at loading port is: XX metric tons."Although the company signing the certificate is not located at the port of loading (Jambi) but in Bandung, the certificate does indicate that a draft survey was performed at the loading port. The function of the Certificate of Weight, as required by the credit, is to certify the weight of the goods at the load port. The content of the certificate clearly indicates that the declared weight of the goods is based on a survey performed at the load port. Therefore, the certificate fulfils its required function.It is to be noted that the interpretation of the "discrepancy's group argument" in relation to Suwandi being a place (of issue) would not appear to be correct. Suwandi appears to indicate the name of the person who signed the document.ConclusionBased on the facts in this particular case, the document is acceptable even though it does not contain the statement "issued at load port". Back to Top

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