Showing posts with the label containers

Multimodal Transport and Documentary Credit

-----   Science transport is an integral part of global trade , the documents issued by the Carrier while taking charge of the goods in a crucial document. The other documents include commercial invoice, packing list, certificate of origin, certificate of inspection etc.

-----   The Transport Document will depend on the mode of transport like sea, air , land and the agency issuing the document . The most commonly used Transport Document is called Bill of Lading with an endorsement "shipped on Board" signifying that the goods have been physically placed on board on the ship. In the case of Air Transport , the document is called Airway Bill issued by airlines or their authorized agents.

-----   Multimodal Transport implies transport by  two or more then two modes under a single document issued by MTO . This document has involved in response to advances in transport technology through containerization and emergence of non-vessel owning operators. Such operators have evolved t…

Implied Warranties in Marine Adventure

In order to make the underwriter liable under a contract of marine insurance or cargo insurance , there are certain preliminary essential conditions which must be complied with though not expressed in clear ords . These terms are implied warranties basically these are two :-

A)  -----  Implied warranties of seaworthiness :-

                It implies that the ship , by which the particular kind of cargo is transported , is fit to carry the particular cargo . For instance , if is frozen meat , then the refrigerating machinery, holds etc. must be in proper order . Actually for a proper cargo all supporting  machinery and others have to be in a good condition and seaworthy , but there are is not implied warranty that the goods are seaworthy .

b)  -----  Marin adventure in all respect to be lawful activity :-

              It implies that an insurance of unenforceable if it is respect to a marine adventure which has declared illegal according to the law of land where the contract was eff…

What Constitutes Material Circumstance

The term "Circumstance" includes any communication made or information received by the assured . Every circumstance is deemed to be material which would influence the judgment of an insurer in determining the risk of fixing the premium . The assured is under obligation to tell every material fact and the change in circumstance , if any , to the insurer . Further if the assured is asked a question whether a material fact or not , by the underwriter , he must answered it truly otherwise it may vitiate the policy . However , the following circumstances need not be disclosed :-

a)  -----  Any circumstance which diminishes the risk .

b)  -----  Any circumstance as to which information has been waived of by the insurer while taking the risk.

c)  -----  Any circumstance which is known or presumed to be known to the insurer in ordinary course of the business ;
    Matters presumed to be known by underwriter are the matters falling in the category of trade usages such as routes being a…

Customs Convention on Container

This Convention is administered by the Customs Co-operation Councils .

Its purpose is to facilitate the use of containers in international traffic . The contracting parties grant free temporary admission to containers subjected to re-exportation when they are ;

-----   Imported loaded to be re-exported empty or loaded .

-----   Imported empty to be re-exported loaded .

Containers have to be approved in compliance with technical conditions concerning construction and closing systems, including ;

-----   External marking with owner's name and address , tare and identification;

-----   They have to be capable to simple the effective sealing;

-----   It must not be possible to introduce or remove any goods without breaking the seal or leaving trace of tampering .

-----   There must be no space in which goods might be hidden;

-----   They must be readily accessible for Customs inspection; a certificate of approval must be displayed on the outside .

-----   Prescribed structural require…

Advantages of TIR to Customs

The advantages for customs authorities of States Contracting Parties to the TIR Convention are considerable.

In particular the following may be mentioned .

-----   The physical inspection of the load and transit country frontiers , expensive in terms of labor and facilities , can be replaced by inspection confined merely to the external condition of the container or the means of transport and the sales  affixed by competent authorities in the country of departure ;

-----   It is no longer necessary to organize a national guaranteeing system since an International guaranteeing system of lawful amount per TIR carnet and per country is provided by the TIR system .

-----   It eliminates the need for an expensive national system of documentary control .

Commercial Advantages :-

The advantages to commerce and to transport interests are equally clear . Goods may travel across national frontiers with a minimum of interference by Customs . By reducing delay in transit , it enables significant econ…

Outline of TIR Convention

To ensure the goods may travel with the minimum of interface en-route and yet offer safeguards to Customs administrations in all transit , the TIR system contains four basic requirements :-

-----   That goods should travel in secure vehicle or containers .

-----   That duties and taxes at risk should throughout the journey be covered by an internationally valid guarantee .

-----   That goods should be accompanied by an internationally accepted carnet taken into use in the country of departure and serving as control document in the countries of dispatch , transit and destination .

-----   That Customs control measures taken in the country of departure should be accepted by the countries of transit and destination .

The TIR convention provides that goods shall be carried in containers or in vehicle whose load compartment is so constructed that there shall be no access to the interior when secured by Customs seal and   that the result of any tempering will be clearly visible . The Conve…

Regulation and Control of Multimodal Transport

-----   The UNCTAD shall not affect or be incompatible with the application of any international convention or national law relating to the regulation and control of transport operations .

-----   The UNCTAD  shall not affect the right of each state to regulate and control at the national law level multimodal transport operations and multimodal transport operators , including the right to take measure relating to consultations, especially before the introduction of new technologies and services between multimodal transport operators , shippers , shipper's organizations and appropriate national authorities on terms and conditions of service ; licensing of multimodal transport operators ; participation in transport and all other steps in the national economy and commercial interest .

-----   The multimodal transport operator shall comply with the applicable law of the country in which he operates and with tyhe provisions of this convention .

-----   This article is intended particu…

Partial Shipments and Drawings

-----   Partial drawings and/o shipments are allowed , unless the credit stipulated otherwise .

-----  Shipments by sea , or by more then one mode of transport but including carriage by sea , made on the same vessel and for the same voyage , will not be regarded as partial shipments , even if the transport documents indicating loading on board bear different dates of issuance and/or  indicate different ports of loading on board .

-----   Shipment made by post will not be regarded as partial shipment if the post receipts or certificates of posting appear to have been stamped or otherwise authenticated in the place from which the credit stipulates the goods are to be dispatched , and on the same date .

-----   Shipments made by modes of transport other than those referred to in the above paragraph of this article will not be regarded as partial shipments , provided the transport documents are issued by one and the same carrier or his agent and indicate the same date of issuance , the s…

Contractual Stipulation

-----  Any stipulation in a contract of carriage by sea , in a bill or lading , or in any other document evidencing the contract of carriage by sea is null and void to the extent that it derogates , directly or indirectly , from the provisions of this convention . The nullity of such a stipulation does not affect the  validity of other provisions of the contract of document of which it forms a part . A clause assigning benefit of insurance of goods in favor of the carrier , or any similar clause , is null and void .

-----  Notwithstanding the provisions of  this , a carrier may increase his responsibilities and obligations under this Law .

-----  Where a bill of lading or any other documents evidencing the contract of carriage by sea is issued , it must contain a statement that the carriage is subject to the provisions of this .which nullify any stipulation derogating therefrom the detriment of the shipper of the consignee .

-----  Where the claimant in respect of the goods has inc…

Document of Title

Multimodal Transport Document to be regarded as Document of Title 

1)  ---  Every consignee named in negotiable or non negotiable multimodal transport document and every endorsee of such document , as the case may be to whom the property in the goods mentioned therein shall pass up or by reason of such consignment or endorsement , shall have all the rights and liabilities of the consignor .

2)  ---  Nothing contained in (1) shall prejudice or affect the right of the multimodal transport operator to claim freight from the consignor or enforce any liability of the consignee or endorsee by reason of his being such consignee or endorsee .

But before to understand this we have to know clearly ;

Issue of Multimodal Transport Document 

-----   Where the consignor and multimodal transport operator have entered into a contract of the multimodal transportation and the multimoddal transport operator has taken charge of goods , he/she shall at the option of the consignor issue a negotiable or non-…

Applicability of the Rules to action in tort

The MTO would also need to be protected from claims when they relate to the performance of the contract but nevertheless the claimant seeks to avoid Rules by founding his claim in tort . The rule will not work when there is no contractual relationship between the MTO and the claimant . However , it contains an important protection of the MTO against a possible circumvention of the Rules by the person who has agreed to bound by the Rules .

These Rules apply to all claims against the MTO relating to the performance of the Multimodal Transport Contract , whether the claim be founded in contract or in tort .

There is also a Rule purports to protect the servants and agents and other person employed by the MTO , and thereby indirectly the MTO himself , by stipulating that the same protection which applies to the MTO would also apply to the benefits of any servant , agent or other person whose services the Multomodal Transport Operator has used in the order to perform the MT contract . 


Berth Occupancy

Berth Occupancy is an important factor which requires a detail study . Specialized berths can achieve handling rates 5 to 10 times more then conventional berths . container ships are much expensive then general Cargo Vessel . So the number of berths should be chosen so that the waiting time is kept to a minimum. Also, the forecasting of number of calls in a stipulated time period is important before finalizing the no. of berths .This should be calculated on the basis of average productivity of the terminal . In the planning procedure which will discuss below , the basic economic effect of waiting time will be main factor  in the investment decision , but there will in addition be the need of consider other criteria .

The following criteria gives the guidelines to the planning of container berths .

a)  ---  Whether the resulting berth occupancy will give a balance between the vessel waiting for berths and berths waiting for vessel .

b)  ---  Whether the average ship  turn-around time wil…

Reservation having a bearing on MT

Followings are Reservation having a bearing on MT :- 

a)   -----  Imports not to be discriminated on the basis of the origin .

b)   -----  Unloading of goods at a place other then the one approved .

c)   -----  Allowing of outright exportation from the premises of commercial undertakings .

d)   -----  Single goods deceleration to cover exports over a period of time .

e)   -----  Evidence of country of origin to be required only in case of fraud  - Declaration instead of certificate .

f)   -----  Transhipment not to be refused on the basis of origin .

g)   -----  Any person having the right to dispose of the goods to be permitted to declare for transhipment (as against carriers at present) .

h)   -----  Transhipment to be allowed on the basis of  commercial/transport document (now : Bill of Transhipment) .

FEDAI Rules and U. N. Convention

Limitation of Action:- 

Under the CTD rules of India , the CTO shall be discharged of all liabilities unless claim is lodged within nine months after ;

1)  -----  The delivery of Goods .

2)  -----  The date when the goods should have been delivered  .

3)  -----  The date when in accordance with conditions of contract failure or deliver the goods would in the absence of evidence to the contrary give the party entitled to receive delivery , the right to treat the goods as lost .

As against these provisions Article 25 of the U.N. Convention lays down the time limit of two years of institute the judicial or arbitral proceedings   against the MTO with a provision that a notice of claim is to be lodged in writing within six months of delivery of goods or stipulated period of such delivery .

The limitation period commences on the date of delivery of goods or the expiry of the last day on which the goods should have been delivered . Thus in cases of delay as well as loss or damage the provisions …

Classification of Logistics Applications

While examining and evaluating alternatives in Logistics Management , classifying the application on various dimensions would help clarity the issue and focus attention . As indicated earlier , logistics application can be classified in terms of issues and actors . Other imported classifications based on various dimensions are :- 

a)  ---  Inbound Logistics and Outbound Logistics :  Most organization have to manage their outbound logistics  (i.e. physical distribution of their products to the customers from the factory) where as inbound logistics concerns itself with the purchasing function . The logistics of purchased product is generally managed by suppliers .  An obvious advantage of managing both inbound and outbound logistics is the possible cost saving when the two movements are coordinated  .

b)  ---  Private vs Public Sector :  The nature of ownership of the organization influences the objectives of organization and hence management of logistics . The choice of modes , transport…

Effect of Issuance of Multimodal Transport Document

The Issuance of  the Multimodal Transport Document confers and imposes on all parties having or acquiring hereafter an interest in the right/obligations and defences set out in the conditions mentioned in the document .

By the issuance of the Multimodal Transport Document the Multimodal Transport Operator ;

a)   -----Undertakes to perform and/or his own name to procure performance of the Multimodal Transport including all services which are necessary to such transport from the time of taking goods in charge to the time of delivery .

b)   -----Accept responsibility for the act of omission of his agents or servants , when such agents or servants are acting within their scope of their employment , as if such act and omission were own .

c)   -----Accept responsibility for the act and omission of any other person whose service he uses for the performance of contract evidenced by the Multimodal Transport Document .

d)   -----Undertakes to perform or to procure performance of all act necessary t…

Defenses For Carriage By Sea Or Inland Waterways

Defenses For Carriage By Sea Or Inland Waterways 

Notwithstanding the provisions of Basis of Liabilities of the MTO , The Multimodal Transport Operator shall not be  responsible for loss or delay in delivery with respect to goods carried by Sea or Inland Waterways , when such loss , damage or delay during such carriage has been caused by :

-----     Act , neglect or default of the master , mariner , pilot or the servants of the carrier in the navigation or  in the management of the Ship .

-----     Fire , unless caused by actual fault or privity of the carrier .

However , always provided that whenever loss or damage has resulted from unseaworthiness of the ship , the MTO can prove that due diligence has been exercised to make the ship seaworthy at the commencement of the voyage .

Conversion of delay into final loss   :-

If the goods have not been delivered within 90 consecutive days following the date of delivery determined according to Rule as Delay in Delivery , the claimant may in …

Inventory and Warehouse


Inventory plays a key role in Logistics Management . The inventories that are directly affected due to outbound logistics are ;_

-----     Finished goods inventory

-----     Pipeline inventory (Primary Transaction)

-----     Warehousing inventory

-----     Pipeline inventory (Secondary Transaction)

-----     Retail inventory

The typical cost trade - offs between inventory an others decisions in Logistics would be :-

-----     Inventory vs Transportation costs

-----     Inventory vs Stock out costs

-----     Inventory vs spoilage and material handling cost .


The purpose of warehousing is to arrange placement of products , provide storage facility , consolidate them with other and similar products , divide them into smaller quantities and to build up a required assortment of products . The necessities of providing warehousing are ;

-----     To get continuous and uninterrupted supply in the market area .

-----     To achieve full benefit of the economies in scale…

Problems in Developing Countries

There are however several problems which developing countries may face in promoting indigenous multimodal transport organizations .

1)   Multimodal transport operations are linked , in the majority of cases with the use of modern transport technologies like containerization ,These technologies are on the whole capital intensive and would require large investment in ship , vehicles , transport equipments , container depots , ports and other inland  transport infrastructure like roads and railways .

2)   At the same time these technologies are labour saving and would give rise to undesirable redundancy of port labour in developing countries where the cargo handling operations are labour intensive .

3)   Indigenous MTOs may face competition from foreign and develop MTOs already operating inb the same routes .

4)   Apart from large investment , international multimodal transport operations will call  for organizing ability as well as marketing and planning expertise of a high order .

5) …

Lien and Detention

Right to lien and detention :-

a)   Constituent shall pay the bills presented by the Forwarder within  15 days of their presentation , failing which penal interest at the provided rate of interest ( may be 3% or near by ) above Bank's lending rate of interest shall become due to payable .

b)    The forwarder has a right to lean and a right to detention over the goods or other securities and effects lying within his power of disposal in respect of any amount whether already due for payment or not which  the forwarder is entitle to receive in respect of service to the customer . In exercise of the lien under the clause , the forwarder shall be entitled to dispose of the goods , either by public or private sales upon which lien is exercised , to recover this dues , provided that he gives a written notice of at least 7 days to the customer of his intention to do so . The forwarder is entitled to recover all the balance amount from the customer after recovery of the dues by the sale of…

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