Whether container shipment must be evidenced explicitly by wording or if the container number alone suffices

QUESTION

Dear Sir

Good Day!

LC shows the below clause:

 SHIPMENT MUST BE EFFECTED INSIDE CONTAINERS AND B/L SHOULD EVIDENCE SO

Is it enough if we show the Container Numbers Ex: CXHU4321079 without the wording “SHIPMENT IS EFFECTED INSIDE CONTAINERS”?

If we don’t show the wording “SHIPMENT IS EFFECTED INSIDE CONTAINERS”, will it be a discrepancy?

If not, please provide us with the relevant ISBP or UCP clause so that we can explain it to the bank.

Regards

Mike 

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ANSWER

Dear Mike,

Your question touches on a key issue of compliance under Letters of Credit: whether container shipment must be evidenced explicitly by wording or if the container number alone suffices.

Here is my answer:

Yes, it may be a discrepancy if the bill of lading does not expressly state that shipment was effected inside containers, depending on how strictly the issuing bank interprets the LC terms.

Detailed Explanation:

The clause in the LC states:

“SHIPMENT MUST BE EFFECTED INSIDE CONTAINERS AND B/L SHOULD EVIDENCE SO”

This means the Bill of Lading must contain explicit evidence that the goods were shipped inside containers.

Simply showing container numbers (e.g., CXHU4321079) may not be sufficient if the B/L does not also state something like:

“Shipped in one 20’ container”

or

“Goods stuffed into container at shipper’s premises”

Why? Because a container number alone does not unambiguously prove that the shipment was “effected inside containers” — it could refer to container tracking only, or not refer to the physical mode of shipment in a clear manner.

Relevant ISBP 821 (2023) Guidance:

Refer to ISBP 821, paragraph E24 (Transport Document Content):

A transport document indicating container numbers and seal numbers may indicate that the goods were shipped in containers. However, when a credit requires that goods be shipped in containers or that shipment be effected by container, the transport document must include a statement to that effect.

This confirms that a statement explicitly saying that goods were shipped in containers is required, not just the container numbers.

Conclusion:

• Yes, failure to include a clear statement that goods were shipped in containers can be a discrepancy.
• Just listing container numbers is not enough, as per ISBP 821 E24.
• The B/L should include explicit wording, such as:

“Shipped in 1 x 40’ container”, or

“Containerized cargo”, or

“Shipment effected inside containers”

Best regards,

Mr. Old Man