According to Article 27 UCP 600 a bank will only accept a clean transport document. As the text indicates, this provision applies to all shipping documents and not only marine shipping documents like bills of ladings. As Article 27 UCP 600 further provides, a clean transport document is one bearing no clause or notation expressly declaring a defective condition of the goods or their packaging.
Article 27 UCP 600 does not require the document to positively state a perfect condition; it rather requires the absence of a clause or notation indicating a defective condition. Since only a specific notation of a defective clause is detrimental, general clauses, typically indicating that the carrier relies on information provided by others, are acceptable.
The ICC further clarifies: “For a transport document to be ‘unclean’ it must expressly declare a defective condition of the goods and/or packaging. ‘Open top container’ is not such a statement. “(ICC Publication No. 459, page 102).
Article 27 UCP 600 additionally states, the word “clean†need not appear on a transport document, even if a credit has a requirement for that transport document to be “clean on boardâ€.
However, not only clauses that describe a defective condition of the goods are detrimental to the acceptance of shipping documents, also limitations to the right of recovery under a bill of lading are harmful. An example of this limitation is:
“This B/L is not valid for clearance before validated by the ship’s agentâ€.
Even though the intention of this clause is only to have the bill of lading stamped and thus cancelled, this type of limitation makes the B/L unacceptable in letters of credit .
Problematic are also the following clauses:
A. a â€straight†B/L:â€upon reasonable proof of identityâ€
B. an “order†(or “negotiableâ€) BL:
1. â€to a person whom [Maersk] reasonably believes to be entitled to take delivery of the goodsâ€, or:
2. “against what [Maersk] reasonably believes to be a genuine original bill of ladingâ€.
To summarize: A bill of lading needs to unconditionally promise the release of the goods. Limitations of the right to recovery of the goods make the bill of lading not acceptable under a letter of credit.
The practice of consolidating cargoes in a container (groupage) is allowed. This is permitted since the reference is made to the merchandise described in the credit, not to the merchandise loaded in the container: Therefore, all merchandise in a container for a single consignee - i.e. the applicant of a documentary credit -must be found in a single bill of lading or should it be in more than on B/L, all B/L’s must be presented to allow the whole of the merchandise in that container to be delivered to the consignee.
Furthermore, banks have come to accept as a matter of practice “multiple bill of lading clauseâ€:â€(…) part load, shippers load, count and stow the above quantity cleared by shippers and shown in this bill of lading forms part of a larger quantity, ship not responsible for incorrect delivery, contents to be delivered to one consignee only.
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