Wole Olufunwa Director (Partner)
Blockchain: Bills of Lading & Official Documents
Carriers, charterers, traders and shippers commonly experience the issue of original bills of lading arriving late at a port of discharge, thereby depriving the lawful holder or consignee of timely taking delivery of the cargo. This may delay cargo operations, lead to incurrence of demurrage or detention fees, directly or indirectly contribute to port congestion and/or the incurrence of port costs and expenses.
Over the years, the shipping industry has developed ways of addressing this issue. In particular, the consignee and/or charterers can issue a Letter of Indemnity (“LOI”) for the benefit of the carrier for the purpose of procuring the early release of the cargo without the need to tender an original bill of lading. The effect of this is to provide the carrier with a form of security against claims it may face as a consequence of releasing the cargo without insisting on the provision of original bills of lading.
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