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TOLERANCE REVISITED

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QUERY
From: NGUYEN HANH HIEN
Sent: Tue 9/22/2009 9:41 AM
To: Nguyen Huu Duc (DNG)
Subject: Re: Where a tolerance is not applicable to quantity of goods

Dear Old Man,

We are very interested in reading your cases. Thank you very much for your explanation.

By the way, please give us your opinion on the following case although it seems similar to Bo BoBo's case . Is it right ? Thanks in advance.

Quote

L/C stipulated as follows :
– Amount : USD40,530.- No tolerance
– Quantity: Frozen fish: grade A, 6.000kg, grade B, 15.000kg.
– Packing : 10kgs per master carton, unit price 1.93 USD/kg.
– Partial shipment : not allowed
(Tolerance of quantity was not mentioned in L/C)

Documents were presented with below quantities :
– Frozen fish grade A : 590 cartons, 5.900 kgs, amount 11.387 USD.
– Frozen fish grade B : 1.510 cartons, 15.100 kgs, amount 29.143 USD.
Total amount : 40.530 USD.
Unquote

In our opinions, no discrepancy in quantities . How about your opinion ?

We are looking forward to your reply.

Intl Payment Dep. – VCB Cantho +

————

COMMENT
From: Nguyen Huu Duc (DNG)
Sent: Tue 9/22/2009 10:37 AM
To: NGUYEN HANH HIEN
Subject: RE: Where a tolerance is not applicable to quantity of goods

Dear Hanh Hien,

You are correct. I totally agree with you that it is not a discrepancy.

UCP 600 sub-Article 30(b) covers the situation where the L/C prohibits partial shipments and the quantity of goods shown in the credit is not given as individual items or packing units (e.g. 5000 tyres). This could be where there is no quantity described or where the quantity is expressed as a unit of weight such as metric tons or kilograms. In these circumstances, the beneficiary has the ability to ship up to 5% less or 5% more provided the L/C amount is not exceeded.

Best regards,
Mr. Old Man …

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2 Comments

  1. HTTHANH

    May 16, 2019 at 5:43 am

    Kính chào anh Đức – chúc anh khỏe mạnh,

    Plz give your opinion on the issue of overshipment:
    L/C says:
    Credit amount tolerance: 10/10
    L/C Quantity: 16,000 MT
    Unit price: X USD/MT FOB ANY PORT IN VIETNAM
    Additional conditions: + AMOUNT AND QUANTITY MORE OR LESS 10% IS ACCEPTABLE (10% Tolerance of Shipment Quantity and Amount)
    —-
    Our case:
    – Total Quantity is: 17,700 MT (exceeds 10% quantity tolerance)
    – Invoice showing the claim amount within 10% tolerance of L/C amount (Shipment value 17,700MT x X USD/BDT less several deductions allowed by L/C)

    So in this case, over-shipment shall count as a discrepancy?

    Brgds,

    Reply

    • Mr Old Man

      May 29, 2019 at 4:41 am

      Yes

      Reply

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