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Effectively control freight risks

by:VIPUTRANS     2020-07-27

Due to the long time involved, wide routes, and various transportation methods involved in international freight transportation, goods must pass through different countries and regions during the transportation of goods, so foreign trade companies often face huge risks in the process of international freight. For example, there are a series of systemic risks such as policy risk, war risk, exchange rate risk, etc. At the same time, there are also non-systematic risks such as freight recovery, bill of lading risk, settlement risk, and fraud in the micro aspect. In view of these risks in international freight, what measures should foreign trade companies take to effectively avoid them?

Recently, Ms. Han Qiao, a senior foreign trader, shared how to detect potential risks in time and effectively avoid problems during transportation in terms of risk prevention and control in the process of international freight, and international freight insurance. A series of cases and countermeasures such as stumbling block, smooth and safe delivery of goods and recovery of payment.

Forwarder, have you chosen the right one?
In one transaction, Yahui Company commissioned its own freight forwarder to export a 40HQ mechanical and electrical product by sea to the Dominican Republic. The goods have arrived, but repeated reminders for the ending payment have no results. In order to avoid greater losses, Yahui decided to deal with it on the spot, but when it showed the original shipowner's bill to the shipping company, it found that the cargo had been released by the shipping company without a bill.

The focus of this case is that the shipping company releases the goods without a bill of lading, so who bears the responsibility? In fact, this reminds everyone that in many countries it is allowed to deliver goods without bill of lading, such as the United States. Therefore, before shipping, you should communicate with the freight forwarder to understand the local market, and at the same time endorse the TO ORDER OF/TO ORDER before using the instruction bill of lading.

Han Qiao said that this case shows the importance of freight forwarding to export companies. Freight forwarding companies play a pivotal role in the transportation of goods. Therefore, cooperating with a good freight forwarding company will reduce a lot of trouble for the company, while a bad freight forwarding company may bring a lot of trouble. So how should foreign trade companies find a good freight forwarder to ensure the smooth progress of the entire cargo transportation link?

She suggested that before choosing, you can check the business license and tax registration certificate of the freight forwarding company, and learn about the company’s scale, outlets, reputation, professionalism and background through your own information collection or acquaintances and friends, as well as the actual process The degree of controllability, through these basic information, consider whether this freight forwarder is suitable for cooperation with itself.

Only fill in the phone number to pick up the goods?
Everyone knows that telex bills are bills of lading that have been issued or should be issued but not yet issued by the carrier or its loading agent after receiving the goods. When many people are doing telex release, the goods will be falsely claimed due to a momentary negligence.

An import and export company in Shanghai made a telex release according to the customer's request after exporting goods to one of its customers in the Middle East, but when the customer arranged to pick up the goods, it was discovered that the goods had been falsely claimed.

'What everyone should pay special attention to here is that we need to sign a document before the teledischarge, which is the teledischarge guarantee. All risks on the teledischarge guarantee are borne by the shipper, that is, the person who signed the guarantee. If the goods are fraudulently claimed, The shipping company is not responsible. In fact, the telex release guarantee is the shipper’s disclaimer of all liabilities caused by the shipping company. The customer does not necessarily have to pick up the goods with the stamped bill of lading, and in some places it only Customers need to fill in a phone number to pick up the goods, which increases the risk of the teledischarge guarantee, so everyone should pay special attention when doing the teledischarge.' Han Qiao said.

Rejection of transfer is not allowed
There is such a case. An exporter received a letter of credit from the importer stating that 'shipping from Shanghai to Piraeus is not allowed for transshipment.' When the negotiating bank claimed compensation from the issuing bank, it was refused payment on the grounds that the letter of credit prohibits transshipment, but the documents It indicated that it would be transshipped, and it was inconsistent with the letter of credit, so the two parties had a dispute.

'When this happens, exporters generally cannot recover the payment. Therefore, I remind everyone to pay more attention to their bills of lading in the future. Under the bill of lading category, there is likely to be a 'ship to be transshipped or possible transshipment' indication. In this case, especially UCP600 stipulates that even if the letter of credit does not allow transshipment, the bank can still accept the transport document indicating that the transshipment is possible or to be transshipped, because the transshipment is possible or the transshipment is to be done does not mean that it must be shipped. At the same time, in the bill of lading There will be a description location in the column of shipping port and departure port. As long as the location is not marked, it means that the transshipment is not necessarily indicated. If the location is marked here, it means that the transshipment is certain. So be sure to pay special attention and study carefully. The bill of lading will be sent to the customer,' she said.

All documents must be submitted in batches
China Tuan Import and Export Corporation was stumbled on the issue of batching. An African importer signed a contract with China Turkey Import and Export Corporation to import 10,000 tons of rice, and the terms of trade are letter of credit at sight. Subsequently, China Turkey received a letter of credit from the bank where the importer was located, but it was stipulated that the approval was not granted. China Turkey completed the delivery task at the port in accordance with the shipment period specified by the certificate, and completed the delivery task in accordance with the quality and quantity through the same liner. However, after the goods arrived at the port of destination, because the local rice price fell, they used the excuse of convenience to say that the delivery location was different, the shipment period was different, and the goods were shipped in batches, so the issuing bank was required to refuse to pay.

As a matter of fact, during the shipment process, China Earth Corporation loaded two thousand tons in Dalian, Qingdao, Shanghai and Xiamen, and finally loaded another two thousand tons in Shenzhen. Such loading all the way is actually not considered as partial shipment. The period should also be based on the last shipment time, as long as the last shipment time is not later than its latest shipment date.

'In this case, we need to know that all the shipment dates must be later than the unloader's requirements, and all the documents must be handed in at one time, so that it is not considered in batches. Also note that if you want to load in advance, If it is transported in three batches, there will definitely be a tail box, and this tail box should be placed in the last batch. This is also an approach that conforms to international practices.” Han Qiao said.

Shipment notice should be sent to customers in time
As a means of economic compensation, insurance occupies an important position in people's economic activities and daily life, and international cargo transportation insurance is an indispensable and important link in international trade.

After the goods are shipped, in accordance with the customary practice of international trade, the consignor should immediately (usually within 3 days after the shipment) send a shipment notice to the buyer or its designated person, so as to facilitate the buyer to handle insurance and arrange delivery. If the seller fails to send the above-mentioned shipping notice to the buyer in time, so that it cannot handle insurance or receive the goods in time, the seller shall be responsible for compensating the buyer for all damages or losses caused by this.

Jinghong Company has suffered such a loss. Once, Jinghong Trading Company exported a batch of hardware tools to Canadian TAG Company under CFR conditions. The shipment day was on Saturday, but Jinghong’s foreign trade salesperson sent the shipment notice to TAG on Monday. Unfortunately, the ship It sank on Sunday night. TAG requires Jinghong to take full responsibility.

Therefore, there is a question of when the shipping notice will be sent to the customer. If Jinghong's foreign trade salesman can send the shipping notice to TAG as soon as possible, at least if TAG can receive the notice before the ship sinks, Jinghong will not be responsible for this responsibility. We all know that shipping notices must be sent to customers in a timely manner, so that even if a lawsuit is filed, it is easy to determine how to determine your responsibility. Therefore, remember to send the shipping notice to the customer in time.

'In addition, the content of the notice we send generally contains the shipping company's bill of lading number, cargo name, amount, packaging and other necessary terms, but when sending these terms, usually not all the payment is received, and only some deposits may be received. So we can use this form to remind the customer to indicate the shipping time he is most concerned about. We usually receive the bill of lading 3 days after the ship sails, especially the owner’s bill, then the shipping notice issued to the customer before that can be Coupled with payment terms and payment contracts to remind customers of the payment time, this will achieve the effect of killing two birds with one stone. At the same time, in the part of international freight insurance, everyone has to study more on issues such as how to purchase insurance, underwriting conditions, and insurance time. These are small things, but it is always necessary to prevent problems before they happen,' she said....
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