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Japan International Freight Forwarders Association Inc. (JIFFA) recently has suggested that shippers use waybills as much as possible on occasions when they must surrender bills of lading (B/Ls) to cargo carriers at origin ports. JIFFA's Judicial Affairs and Education Committees jointly held a seminar on Sept. 18, 2013 to discuss various documents for cargo transport. During the seminar, they focused on, among other subjects, problems arising from B/Ls that are surrendered to carriers and the use of waybills. If shippers do not have a choice but to surrender B/Ls to ship operators, the committees added, they should appreciate possible risks and take precautions against them.
During the joint seminar, Mr. Shoji Bando, vice-chairman of the Judicial Affaires Committee, gave reasons for selecting surrender B/Ls and waybills as a subject for the seminar. Following Mr. Bando, Mr. Hitokazu Ito of Sankyu Inc., a member of the same committee, gave briefings on risks posed by B/Ls surrendered to carriers at origin ports and the use of waybills. Mr. Hiroki Okabe, a lawyer from Tokyo-based law firm Okabe & Yamaguchi and the chirman of the said committee, introduced and commented on relevant judicial precedents.
Mr. Ito said that it is a convenient system for shippers to surrender B/Ls to carriers, but emphasized that the system is not supported by any law or any other regulations or international treaties. As such, when a non-vessel-operating common carrier (NVOCC) is involved in a legal dispute, it may have to take responsibility both as a cargo transporter and a shipper, he added. For this reason, Mr. Ito suggested the audience to encourage shippers to use waybills which are set forth in the Comite Maritime International (CMI)'s rules on sea waybills and the International Chamber of Commerce (ICC)'s Uniform Customs and Practice for Documentary Credits, 2007 Revision, ICC Publication No. 600 (UCP 600).
He also advised that freight forwarderss hold talks with shippers, and that in situations when waybills are available, B/Ls be replaced with them as soon as possible. However, if shippers do not have a choice but to surrender B/Ls co carriers at origin ports, Mr. Ito said, carriers need to fully understand risks that they could suffer from adopting the system. He also proposed that in these cases, trnsporters balance profits that they could gain and losses that they could suffer from such shippers, and decide to continue to do business with them.
Mr. Okabe introduced and commented on two judicial decisions that Japanese courts made in the past in lawsuits filed regarding B/Ls surrendered to carriers at origin ports. He pointed out that when a shipper surrendered its original B/L to the transporter at the origin port, the terms and conditions described on the back of the B/L could not be applied to the transporters as, for instance, in the case the shipper faxed only the face of the copied original B/L surrendered to the carrier to its consignee at the discharging port, adding that such a case might constitute a case ''providing transport service without issuing a B/L.''
In another judicial precedent introduced by Mr. Okabe, a shipper asked its carrier to cancel the B/L which once had been surrendered to the carrier and had the transporter issue a new original B/L at the port of origin. At the discharging port, the local agent for the carrier handed over the shipments to the holder of the copy of the canceled B/L that the shipper had first surrendered to the carrier, despite the fact that the agent should have delivered the shipments to the holder of the original B/L issued newly by the carrier. As such, the carrier was forced to accept liability for the total value of the shipments.
Mr. Okabe also explained examples in South Korea and China, warning that annulment of B/Ls that shippers once surrendered to carriers could cause trouble.
As another subject, the joint seminar focused on things that transporters can do in case import cargoes are damaged. On this subject, a lecture was given in two sessions, which were held for teaching basic knowledge and having attendees study specific cases. Lecturers were invited from Sompo Japan Insurance Inc., a supporting member of JIFFA. In July, the Education Committee held an intensive seminar on international multimodal transport in Kokura, Fukuoka Prefecture, at which time the committee advised that transporters always make risk-management efforts particularly when importing shipments. The seminar was so highly rated that members asked JIFFA to hold a similar seminar in Kanto. As such, the subject was handled during the recent joint seminar.
The Education Committee also indicated that there had been an accident in which a containership sank in the Indian Ocean. During the first session, Mr. Shinohara of Sompo Japan Insurance gave briefings on the scope of responsibilities that those who claim and accept liability as well as transporters must take. He also commented on insurance for oceangoing cargoes and JIFFA's liability insurance.
During the second session, Mr. Sako, another employee of the Tokyo-based insurance company and a member of the Judicial Affairs Committee, discussed measures that can be taken from six examples, such as negotiations with shippers and transporters.
