A boat on Han river, Da Nang, Vietnam
QUESTION
Dear Mr. Old Man,
I have a question regarding “to order” bill of lading.
LC requires among other documents a full set of clean on board ocean bills of lading made out to the order of the issuing bank…
Documents presented are complying and the issuing bank advises the applicant of the same. However, the applicant does not take up the documents to receive the goods.
Can the issuing bank can receive the goods and sell to cover the payment made to the presenter?
Thank you!
N
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ANSWER
Hi,
The fact that the issuing bank would require bills of lading to be made out to its order is to ensure that it can control the title of the goods until the applicant has fulfilled its obligations toward the issuing bank under the contract for opening the LC. It would clear the goods and take delivery of the same only in the worst case scenario.
It depends on case by case basis. To clear the goods, the issuing bank may be requested by the Customs to provide them with (i) the importer’s authorization for the issuing bank to clear the goods or (ii) a court order allowing the issuing bank to take delivery of the cargoes, and pay customs duty …
Please contact Customs in your country for further guidance on this issue.
Kind regards,
Mr. Old Man
