Non Negotiable SeaWay Bill VS Bill Of Lading

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BRENDA
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Joined: 05/07/2009
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hello,

 i would really like to know the significant difference between Seaway Bill (non negotiable in nature) and the Bill of Lading.

 they are both transport document for transporting goods via sea, and the Bill of Lading is a document of 'title' while the Sea Way is not

in what context are they used in an LC?

 Brenda

 

 

Abrar
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Joined: 03/12/2009
Sea waybill vs negotiable B/L

Both of my fellow respondents' explanations regarding certain deficiencies of a sea waybill,  are extremely sound and relevant. 

In addition to points that they have raised; the fact that the waybill is not a document of title, not negotiable, not required to be presented to the carrier to take delivery of the goods, and unlikely to be considered as valid security for the purpose of bank finance, I would also add a further issue of risk. That is, unlike negotiable B/Ls, whilst the goods are in transit, the consignor may instruct the carrier to direct the cargo to a different consignee than that evidenced on the waybill, without the named consignee's knowledge. There are however, ways to mitigate this beneficiary driven risk, but it requires the cooperation of the beneficiary.

Conversely, there are also ways to mitigate the applicant driven risk of taking delivery without payment, and this would require the applicant's cooperation in agreeing to consign the goods to the order of the issuing bank, pending settlement.

BRENDA
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Joined: 05/07/2009
thank you all this has

thank you all

this has certainly thrown more light and i begin to appreciate these documents more

best regards

KKehrer
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Joined: 10/15/2009
Dear Brenda ! The doc does

Dear Brenda ! The doc does not represent the shipped goods as a "official" B/L does. Due to my knowledge You can not issue the doc "to order", only to a named consignee. So in that case the doc is mostly used in intracom shipments and or dispatches shortly running i.e. between Europe and North Africa, while docs need sometimes more time to be presented under L/C terms and conditions and fowarded to abroad. You avoid costs for storage in P/discharge and so on. Please take a look into L/C terms conc applicant and ben. Maybe they are members of the same group so a classic B/L is not necessary. But for bank security reasons such a doc is normally not acceptable. Hope these lines clear the matter. otherwise revert. rgds Kurt

Abdelmajid Belhocie
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Joined: 11/24/2008
Negotiable and Non Negotiable BL

With a negotiable bill of lading, the carrier or steamship company requires the consignee to deliver one of the original bills of lading when making a claim for the goods. If they don’t have an original bill of lading, in most cases they can’t take delivery of the goods. With a non-negotiable bill of lading (also referred to as a straight bill of lading or Sea way Bill), the consignee in many cases can take delivery of the goods without having to present an original bill of lading. So, what difference does it make? If your company doesn’t want the buyer taking possession of the goods before you are paid, the documentary conditions in the letter of credit should require a negotiable bill of lading.By insisting on having a B/L made out to order or consigned to the bank you are making sure that the consignee will not get the goods before getting the documents and he can only get the documents once he paid or arranges to pay if it s a deferred payment

bob_exports
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Joined: 10/11/2009
we need to get our terms straight

We need to get our terms straight... there is no such thing as a "steamship company" (cargo vessels are very rarely, if ever, powered by steam these days) and UCP does not anywhere mention even "shipping companies" only "carrier".

A sea waybill is not a non-negotiable B/L, only a straight B/L which is consigned directly to a company is. A sea waybill is just that and not any sort of B/L.

The trick is to read the fine print on the B/L, even though banks are not required to do so (recent ICC Opinion), to ensure that  the B/L does not say "If required by the carrier one B/L to be presented..." It is the "If required by carrier" which must be manually struck out and stamped/initialled by the carrier.

Abrar
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Joined: 03/12/2009
Non-negotiable B/Ls

By virtue of the fact that a sea waybill is always  "straight" consigned, its characteristic is necessarily that of a qasi non-negotiable instrument.

As you say, there has been much debate on the issue of the carrier's right to deliver without production of the B/L, but this centred more on the "documents of title", negotiable aspects of B/Ls. No doubt, you would be aware, but for the benefit of other members of the forum, who may be interested, the issue was highlighted in the "Rafaela S" case, culminating in the English Court of Appeal overturning the earlier decision  (that a "straight" consigned B/L is not a document of title and thus not subject the Hague-Visby rules) made in the lower courts. The decision to overturn was based on the Court of Appeal's interpretation of Art. 1(b) of the Hague-Visby rules, which referred to "a bill of lading or any similar document of title". The Court focused on the "..any similar document of title" and ruled that the interpretation must be that all B/Ls (negotiable or otherwise) must all be treated as documents of title, the main characteristic of which that one must be produced to take delivery.The distinction was however made that a "straight" B/L is unlike a sea waybill in that a "straight" B/L shares similar characteristics to that of a negotiable B/L, i.e contains terms of carriage on reverse, issued in a set, etc. 

Although implicit previously, many carrier's now explicit insertion of the clause on the reverse of B/Ls, stating that the carrier has the right to deliver against suitable identification, (but not necessarily the production of the B/L) is an attempt to protect their liabilities. As you say, the only secure way to overcome this from the sellers viewpoint, is to request deletion of such clause.   

As explained by others on this forum, the sea waybill does have its uses, for short voyages, and where there is a degree of trust beteen the seller and buyer. A seller should be wary of being asked to provide a "straight" consigned B/L made out to the applicant, unless the full set flows through the banking channels, and thus assumed to be held at the seller's disposal, pending payment.

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