UCP 600 article 2 indicates that a “Complying presentation” means a presentation that is in accordance with the terms and conditions of the credit, the applicable provisions of these rules and International Standard Banking Practice. To obtain the expected services from the bank, the beneficiary of a documentary credit must therefore prepare the documents required by the L/C respecting - hierarchically - the L/C conditions, the provisions envisaged by UCP 600 and by the international standard banking practice partially codified in the ICC publication ISBP 745. Below, we will analyse how to prepare a “Transport Document Covering at Least Two Different Modes of Transport” (also known as a multimodal or combined transport document) in compliance with the conditions of the L/C and the above-mentioned provisions.
The diffusion of multimodal transport started, with the introduction of containers in the United States in the 1950s. In fact, by carrying out a "door to door" transport by means of containers (or other loading units) a multimodal transport is achieved. In 1980 the United Nations Convention on international multimodal transport was approved, which, however, has not entered into force as the expected minimum number of ratifications by the States has not yet been reached.
In this expectation, UNCTAD and the International Chamber of Commerce (ICC) have developed a set of rules of a negotiation nature, i.e. valid only if signed by the parties, intended to be introduced into individual multimodal transport contracts: The “UNCTAD/ICC Rules for Multimodal Transport Documents” (available at this link: https://unctad.org/system/files/official-document/tradewp4inf.117_corr.1_en.pdf).
The multimodal transport document is defined as a document certifying the existence of a multimodal transport contract and can be issued in negotiable or non-negotiable form or indicate the recipient by name. The indications affixed in this document are evidence, until proven otherwise, of the acceptance by the Multimodal Transport Operator of the goods described in it, unless the printed text of the document does not appear (or has not been added) contrary indication such as "weighed, filled and checked by loader", "container filled by loader" or other similar expression.
UCP 600 has dedicated article 19 to a “Transport Document Covering at Least Two Different Modes of Transport” which reports as follow
A transport document covering at least two different modes of transport (multimodal or combined transport document), however named, must appear to:
i. indicate the name of the carrier and be signed by:
Any signature by the carrier, master or agent must be identified as that of the carrier, master or agent.
Any signature by an agent must indicate whether the agent has signed for or on behalf of the carrier or for or on behalf of the master.
ii. indicate that the goods have been dispatched, taken in charge or shipped on board at the place stated in the credit, by:
The date of issuance of the transport document will be deemed to be the date of dispatch, taking in charge or shipped on board, and the date of shipment. However, if the transport document indicates, by stamp or notation, a date of dispatch, taking in charge or shipped on board, this date will be deemed to be the date of shipment.
iii. indicate the place of dispatch, taking in charge or shipment, and the place of final destination stated in the credit, even if:
a) the transport document states, in addition, a different place of dispatch, taking in charge or shipment or place of final destination, or
b) the transport document contains the indication “intended” or similar qualification in relation to the
vessel, port of loading or port of discharge.
iv. be the sole original transport document or, if issued in more than one original, be the full set as indicated on the transport document.
v. contain terms and conditions of carriage or make reference to another source containing the terms and conditions of carriage (short form or blank back transport document).
Contents of terms and conditions of carriage will not be examined.
vi. contain no indication that it is subject to a charter party.
A transport document may indicate that the goods will or may be transhipped provided that the entire carriage is covered by one and the same transport document.
A transport document indicating that transhipment will or may take place is acceptable, even if the credit prohibits transhipment.
It is also important to mention, that to produce a compliant multimodal transport document under an L/C, to respect the provisions reflected in UCP 600 article 14 which contains the "Standard for Examination of Documents".
UCP 600 article 14(e) reads as follows: "In documents other than the commercial invoice, the description of the goods, services or performance, if stated, may be in general terms not conflicting with their description in the credit.". In the light of this, it can be concluded that the description of the goods given in a multimodal transport document need not be identical to that in the L/C, provided it is not in conflict with it.
It is also specified, in UCP 600 article 14(j), that the exact correspondence of the addresses of the beneficiary or of the applicant between the documents presented and what is stated in the L/C is not necessary, but they must indicate the same country that appears in the respective addresses present in L/C. All «contact» elements (telephone, fax numbers, etc.) when they form part of the address of the beneficiary or of the applicant will not be taken into consideration. However, these contact elements must be stated in the "consignee" boxes or in the context of the "notify party".
UCP 600 article 14(k), finally, states that "The shipper or consignor of the goods indicated on any document need not be the beneficiary of the credit" and this, also applies to the multimodal transport document.
Additional - non-exhaustive - indications are given below regarding the correct setting of the multimodal transport document with reference to what is indicated in paragraphs D1-D32 of the ICC publication ISBP 745:
- A requirement in an L/C for the presentation of a transport document, however named, covering movement of goods utilizing at least two different modes of transport means that UCP 600 article 19 is to be applied in the examination of that document.
- A multimodal or combined transport document is not to indicate that shipment or dispatch has been effected by only one mode of transport, but it may be silent regarding some or all of the modes of transport utilized.
E.g., if an L/C requires a “multimodal transport document” from Japan to Italy, a document stating the following is not acceptable:
Port of Loading: Tokyo
Port of Transhipment: Gioia Tauro
Port of Discharge: Naples
Since, the "places" are indicated as ports, only one means of transport was used. Instead, a “multimodal transport document” indicating the following would be acceptable:
Port of Loading: Tokyo
Port of Transhipment: Gioia Tauro
Place of delivery: Naples
and this is acceptable even if the document does not indicate the means of transport used to transport the goods from Gioia Tauro to Naples.
- If an L/C requires the presentation of a transport document other than the multimodal transport document, but it appears evident from the routing of the goods that "more than one mode of transport is to be utilized", then UCP 600 article 19 should apply;
- A multimodal transport document can be issued by an entity other than the carrier or the master (captain). If the L/C indicates "Freight Forwarder's Multimodal Transport Document is acceptable" or "House Multimodal Transport Document is acceptable" (or similar indications) the multimodal transport document can be signed by the issuer without indicating the "the capacity in which it has been signed” or the name of the carrier;
- An indication in an L/C of a clause such as “Freight Forwarder's Multimodal Transport Documents are not acceptable” or “House Multimodal Transport Documents are not acceptable” (or similar indications), has no meaning (unless the L/C indicates specific requests on how the document must be issued or signed) and such indications will not be taken into consideration and the document will be examined as outlined in UCP 600 article 19;
Therefore, in the presence of a clause such as "Freight Forwarder's Multimodal Transport Documents are not acceptable", the banks will be required to accept a transport document signed with the indication "as carrier", without referring to the actual capacity of the issuer of the document. The presence of an indication such as "Transport document issued by freight forwarder are not acceptable, even if in the capacity as carrier or an agent for the carrier" would imply the non-acceptability of a FIATA transport document, a "house”, of a document issued by a “forwarder”;
- A multimodal transport document must be signed according to the provisions of UCP. 600 article 19. If an "agent" signs the document, this agent must be indicated and will sign as follows "agent for (name), the carrier" or indicating "agent on behalf of (name), the carrier" or similar indications. If the carrier is identifiable in the document as "the carrier", the agent can sign as "agent for [or on behalf of] the carrier" without renaming the carrier;
- In a multimodal transport document, if the L/C requires that the shipment be directed to a port, the name of the port of destination should be indicated in the field dedicated to the "port of discharge". The name of the port of destination could also be stated in the "Place of final destination" field (or similar indications), indicating a "notation" that the port of destination is the one mentioned in the "Place of final destination";
- When the first leg of the transport, as requested by the L/C, is by sea, it is necessary to indicate an “on board notation”. The on board notation, when a means of pre-carriage is indicated in the transport document, requires the presence of four pieces of information which must be clearly indicated in the transport document: 1) That the goods are "shipped on board" (Terms such as “Shipped in apparent good order”, “Laden on board”, “Clean on board” or other indications incorporating “shipped” or “on board” have the same meaning as “Shipped on board”), 2) the name of the vessel, 3) the port of loading and 4) the date of shipment e.g. “Shipped on board Sea Pride from Naples port, 16 May 2022.”
- Please note that the on board notation is also required when the vessel and/or port of loading are stated to be "intended". In this case the on board notation must include the name of the vessel and/or the port of loading.
For more info about on-board notation pls see the chart available vis this link.
- A multimodal transport document must indicate the number of originals in which it was issued;
- The indications “First Original”, “Second Original”, “Third Original”, “Original”, “Duplicate”, “Triplicate” or similar expressions are all synonyms of original;
- A multimodal transport document must not contain indications regarding the defective condition of the goods or their packaging. A clause such as ""packaging is not sufficient for the sea journey" makes the document "unclean" and therefore discrepant. On the other hand, a clause such as ""packaging may not be sufficient for the sea journey"" can be accepted;
- If an L/C requires the presentation of a "straight" multimodal transport document (e.g. "consigned to (named entity)"), the document must not contain indications such as "to order" or "to order of" preceding the "named entity", or the expression "or order" following the "named entity";
- If a multimodal transport document is issued "to order" or "to order of the shipper" it must be endorsed by the shipper. The endorsement can be made by a "named entity" on behalf of the shipper (made for [or on behalf of] the shipper);
- If an L/C requires the presentation of a multimodal transport document "consigned to order of (named entity)", it must not indicate that the goods "are straight consigned to that named entity";
- The indication "freight payable at destination" may be stated as "freight collect";
- An indication of costs additional to freight may be made by express reference to additional costs or by the use of trade terms which refer to costs associated with the loading or unloading of goods, such as, but not limited to, Free In (FI), Free Out (FO), Free In and Out (FIO) and Free In and Out Stowed (FIOS).
- The so-called “demurrage costs” or “detention costs” are not an indication of additional costs to the freight;
- A multimodal transport document must not expressly indicate that the goods indicated therein will be delivered only upon presentation of "one or more other multimodal transport documents", unless the entire set of the document issued is part of the same presentation of the same L/C;
- If an L/C sets out the details of one or more notify parties a multimodal transport document may state further notify parties. If the L/C does not define the details of a "notify party", a multimodal transport document can state any "notify party". In the latter case, should the applicant's data be mentioned, such data must not conflict with what is mentioned in the L/C;
- Data corrections in a multimodal transport document must be authenticated. The authentications must be performed by the carrier, the master (captain) or one of their "named agents", which can be different from the agent who issued or signed the multimodal transport document. Non-negotiable copies do not need to bear the authentications of the corrections made on the original;
- Copies of the multimodal transport document do not require authentication of any corrections made to the original;
In conclusion, it seems appropriate to underline that the documents to be presented in use of an L/C must be prepared in compliance with the conditions of the L/C, the provisions of the UCP 600 and the international standard banking practice, following the relative hierarchy. The preparation of the multimodal transport document requires, as for all documents, the careful attention of the operators by coordinating appropriately with the issuer.
